Answer:
True
Explanation:
The accrual accounting system is one of the two methods of reporting or recording income and expenses. The other way is the cash system.
In the accrual method, income and expenses are accounted for when they were earned or incurred regardless of whether money changed hands. Sales are reported when goods are delivered, and the invoice is issued even if the customer has not paid.
The accrual system is the standard method of operating for many businesses, big and small. The accrual method matches revenue and income with the time of their respective economic events. The general accounting principles recommend the accrual accounting system for both the private and public sectors.
The following data pertain to the Oneida Restaurant Supply Company for the year just ended.
Budgeted sales revenue $205,000
Actual manufacturing overhead 336,000
Budgeted machine hours (based on practical capacity) 8,000
Budgeted direct-labor hours (based on practical capacity) 20,000
Budgeted direct-labor rate $14
Budgeted manufacturing overhead $364,000
Actual machine hours 11,000
Actual direct-labor hours 18,000
Actual direct-labor rate $15
Required:
a. Compute the firm's predetermined overhead rate for the year using each of the following common cost drivers: (a) machine hours, (b) direct-labor hours, and (c) direct-labor dollars.
b. Calculate the over-applied or under-applied overhead for the year using each of the cost drivers listed above.
Answer:
Predetermined overhead rate = Budgeted manufacturing rate/Allocation base
a. Machine hours
= 364,000 / 8,000
= $45.5
Predetermined overhead rate = $45.5
Direct-labor hours
= 364,000 / 20,000
= $18.2
Predetermined overhead rate = $18.2
Direct-labor dollars
Budgeted labor hours = 20,000 * $14 = $280,000
Predetermined overhead rate = 364,000 / $280,000 = $1.3
b. Machine hours
Manufacturing overhead applied = Actual machine hours * Predetermined overhead rate = $45.5 * 11,000 = $500,500
Over/Under applied overhead = 336,000 - 500,500
Over-applied overhead = $164,500
Direct-labor hours
Manufacturing overhead applied = Actual direct-labor hours * Predetermined overhead rate = $18.2 * 18,000 = $327,600
Over/Under applied overhead = 336,000 - 327,600
Under-applied overhead = $8400
Direct-labor dollars
Manufacturing overhead applied = Actual direct-labor hours * Actual direct-labor rate * Predetermined overhead rate
Manufacturing overhead applied = 18,000 * $15 * $1.3 = 351,000
Over/Under applied overhead = 336,000 - 351,000
Over-applied overhead = $15,000
we know that
Predetermined overhead rate = Budgeted manufacturing rate ÷ Allocation base
a. Machine hours
= 364,000 ÷8,000
= $45.5
Predetermined overhead rate = $45.5
Direct-labor hours
= 364,000 ÷ 20,000
= $18.2
Predetermined overhead rate = $18.2
Direct-labor dollars
Budgeted labor hours = 20,000 × $14 = $280,000
Predetermined overhead rate = 364,000 ÷ $280,000 = $1.3
b. Machine hours
Manufacturing overhead applied = Actual machine hours × Predetermined overhead rate
= $45.5 × 11,000
= $500,500
So,
Over/Under applied overhead = 336,000 - 500,500
Over-applied overhead = $164,500
Direct-labor hours
Manufacturing overhead applied = Actual direct-labor hours × Predetermined overhead rate
= $18.2 × 18,000
= $327,600
Over/Under applied overhead = 336,000 - 327,600
Under-applied overhead = $8400
Direct-labor dollars
Manufacturing overhead applied = Actual direct-labor hours × Actual direct-labor rate × Predetermined overhead rate
= 18,000 × $15 × $1.3
= 351,000
Over/Under applied overhead = 336,000 - 351,000
Over-applied overhead = $15,000
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Joni Metlock Inc. has the following amounts reported in its general ledger at the end of the current year.
Organization costs $22,300
Trademarks 12,700
Discount on bonds payable 35,300
Deposits with advertising
agency for ads to promote
goodwill of company 10,300
Excess of cost over fair
value of net identifiable
assets of acquired subsidiary 75,300
Cost of equipment acquired for
research and development projects;
the equipment has an alternative future use 85,300
Costs of developing a secret formula for a
product that is expected to be marketed for
at least 20 years 79,600
On the basis of this information, compute the total amount to be reported by Metlock for intangible assets on its balance sheet at year-end.
Answer:
Joni Metlock Inc.
Computation of the total amount of Intangible Assets on the Balance Sheet at year-end:
Organization costs $22,300
Trademarks 12,700
Goodwill acquired 75,300
Secret formula Development cost 79,600
Total amount of intangibles $189,900
Explanation:
Data:
Organization costs $22,300
Trademarks 12,700
Discount on bonds payable 35,300
Deposits with advertising
agency for ads to promote
goodwill of company 10,300
Excess of cost over fair
value of net identifiable
assets of acquired subsidiary 75,300
Cost of equipment acquired for
research and development projects;
the equipment has an alternative future use 85,300
Costs of developing a secret formula for a
product that is expected to be marketed for
at least 20 years 79,600
b) Metlock's intangible assets are the non-physical assets like Goodwill, brand recognition and intellectual property, such as patents, trademarks, and copyrights.
SY Manufacturers (SYM) is producing T-shirts in three colors: red, blue, and white. The monthly demand for each color is 3,487 units. Each shirt requires 0.75 pound of raw cotton that is imported from the Luft-Geshfet-Textile (LGT) Company in Brazil. The purchasing price per pound is $1.55 (paid only when the cotton arrives at SYM's facilities) and transportation cost by sea is $0.70 per pound. The traveling time from LGT’s facility in Brazil to the SYM facility in the United States is two weeks. The cost of placing a cotton order, by SYM, is $186 and the annual interest rate that SYM is facing is 32 percent of total cost per pound.
a. What is the optimal order quantity of cotton? (Round your answer to the nearest whole number.)
Optimal order quantity pounds
b. How frequently should the company order cotton? (Round your answer to 2 decimal places.)
Company orders once every months
c. Assuming that the first order is needed on 1-Jul, when should SYM place the order?
17-Jun
1-Jul
15-Jul
d. How many orders will SYM place during the next year? (Round your answer to 2 decimal places.)
Number of orders times
e. What is the resulting annual holding cost? (Round your answer to the nearest whole number.)
Annual holding cost $ per year
f. What is the resulting annual ordering cost?
Annual ordering cost $
g. If the annual interest cost is only 5 percent, how will it affect the annual number of orders, the optimal batch size, and the average inventory?
Answer:
Kindly check explanation
Explanation:
Given the following :
Price per pound = $1.55
Raw material required = 0.75 pound
Transport cost by sea = $0.70
Monthly demand for each of the three colors = 3487
EOQ = √2DS / H
D = 3 * 12 * 3487 * 0. 75 = 94149
Total cost of purchase = 1.55 + 0.70 = 2.25
Setup cost (S) = $186
Holding cost = 32% * 2.25 = 0.72
EOQ = √(2*94149*186) / 0.72
= 6974.50
b. How frequently should the company order cotton?
Annual demand / EOQ
94149 / 6974.50
= 13.50 ;
12 months / 13.50 = 0.89 month
c. Assuming that the first order is needed on 1-Jul, when should SYM place the order?
Since lead time is 2 weeks, order should be made 2 weeks before : 17th June
d. How many orders will SYM place during the next year? (Round your answer to 2 decimal places.)
Annual demand / EOQ
94149 / 6974.50
= 13.50 times
e. What is the resulting annual holding cost? (Round your answer to the nearest whole number.)
Holding cost * EOQ /2
0.75 * (6974.50/2) = 2615.44
f. What is the resulting annual ordering cost?
Annual ordering cost $
Ordering cost * number of orders
$186 * 13.50 = $2,511
Deal Leasing leased equipment to Hand Company on January 1, 2021. The leased equipment's book value is $420,000 with no estimated residual value at the end of its useful life. The remaining useful life of the leased equipment is 15 years. The lease payments were calculated to provide the lessor a 10% return. Ten annual lease payments of $60,000 are due at the beginning of each year beginning January 1, 2021. Both companies use the straight-line method in depreciation/amortization their assets.
Answer:
The requirements are missing, so I looked for a similar question. This is a financial lease since the PV of the lease payments represents 97% of the asset's value.
January 1, 2021, equipment leased from Deal leasing
Dr Right of use asset 405,541.20
Cr Lease liability 405,541.20
the right of use asset = PV of lease payments = $60,000 x 6.75902 (PV annuity due, 10%, 10 periods) = $405,541.20
January 1, 2021, first lease payment
Dr Lease liability 60,000
Cr Cash 60,000
December 31, 2021, depreciation expense on leased asset
Dr Depreciation expense 40,554.12
Cr Accumulated depreciation 40,554.12
depreciation expense = $405,541.20 / 10 = $40,554.12
December 31, 2021, interest expense on asset lease
Dr Interest expense 34,554.12
Cr Interest payable 34,554.12
interest expense = ($405,541.20 - $60,000) x 10% = $34,554.12
DS Unlimited has the following transactions during August.
August 6 Purchases 52 handheld game devices on account from GameGirl, Inc.,
for $110 each, terms 2/10, n/60.
August 7 Pays $310 to Sure Shipping for freight charges associated with the
August 6 purchase.
August 10 Returns to GameGirl seven game devices that were defective.
August 14 Pays the full amount due to GameGirl.
August 23 Sells 32 game devices purchased on August 6 for $130 each to
customers on account. The total cost of the 32 game devices sold is
$3,670.00.
Required:
Record the transactions of DS Unlimited, assuming the company uses a perpetual inventory system.
Answer:
Date Account Title Debit Credit
Aug-06 Inventory $5,720
(52 * $110)
Accounts Payable $5,720
Aug-07 Inventory $310
Cash $310
Aug-10 Accounts Payable $770
(7 * $110 )
Inventory $770
Aug-14 Accounts Payable $4,950
Inventory $99
Cash $4,851
Aug-23 Accounts Receivable $4,160
( 32*$130)
Sales revenue $4,160
Aug-23 Cost of goods sold $3,670
Inventory $ 3,670
Ian loaned his friend $20,000 to start a new business. He considers this loan to be an investment, and therefore requires his friend to pay him an interest rate of 7% on the loan. He also expects his friend to pay back the loan over the next four years by making annual payments at the end of each year. Ian texted and asked that you help him calculate the annual payments that he should expect to receive so that he can recover his initial investment and earn the agreed-upon 7% on his investment.
Required:
Calculate the annual payment and complete the following capital recovery schedule:
Year Beginning Amount Payment Interest Paid Principal Paid Ending Balance
Answer:
Ian and His Friend's Business Loan
a. Annual payment = $5,904.56
b. Capital Recovery Schedule:
Year Beginning Payment Interest Principal Ending
Amount Paid Paid Balance
1 $20,000 $-5,904.56 $1,400 $4,504.56 $15,495.44
2 $15,495.44 $-5,904.56 $1,084.68 $4,819.88 $10,675.56
3. $10,675.56 $-5,904.56 $747.29 $5,157.27 $5,518.29
4. $5,518.29 $-5,904.56 $386.27 $5,518.29 $0
Explanation:
Ian's loan to his friend = $20,000
Interest rate = 7%
Payback period = 4 years
Repayment = annual at the end of each year.
Ian can retrieve $5,904.56 at the end of each period to reach the future value of $20,000.00 and total interest of $3,618.25.
Using an online financial calculator:
N (Number of Periods) 4.000
I/Y (Interest Rate) 7.000%
PMT (Periodic Payment) $-5,904.56
Starting Investment $20,000.00
Total Interest $3,618.25
Juanita is deciding whether to buy a skirt that she wants, as well as where to buy it. Three stores carry the same skirt, but it is more convenient for Juanita to get to some stores than others. For example, she can go to her local store, located 15 minutes away from where she works, and pay a marked-up price of
Answer:
the question is incomplete, so I looked for similar questions that can serve as an example:
local store 15 minutes away and a price of $104 across town 30 minutes away and a price of $88 neighboring city 1 hour away and a price of $63 Juanita makes $42 per hour at her work, and her purchase decision includes the opportunity cost of lost wages.total economic cost:
local store = $104 + [1/4 hours x 2 (round trip) x $42] = $125 across town = $88 + [1/2 hours x 2 (round trip) x $42] = $130 neighboring city = $63 + [1 hour x 2 (round trip) x $42] = $147Juanita should purchase the skirt at her local store because the total economic cost will be lowest = $125
If your numbers are different, just change the numbers of the 3 equations.
It is important that marketers be able to identify which strategy a competitor is using so that they better understand how to position their own products and services. You will see a list of recent or potential strategic decisions made by large firms, and your job is to identify which type of strategy was used in each example.
While there are a variety of strategies across industries, most fall under four basic categories.
1. Market penetration strategies emphasize selling more existing products and services to existing customers.
2. Product development strategies involve creating new goods or services for existing markets.
3. Market development strategies focus on selling existing products or services to new customers. The targeted new customers could be a different gender, age group, or international market.
4. Finally, diversification strategies involve offering new products that are unrelated to the existing products produced by the organization.
Select the most appropriate category of emotional intelligence for below mention behaviors.
i. Arm and Hammer selling baking soda for new purposes.
a. Market penetration
b. Product development
c. Market development
d. Diversification
ii. Apple opening mini-stores within Target
a. Market penetration
b. Product development
c. Market development
d. Diversification
iii. Disney purchasing ESPN
a. Market penetration
b. Product development
c. Market development
d. Diversification
Answer:
1. Market development
2. Market penetration
3. Diversification
Explanation:
we have already been given a definition of these concepts from question
1.
for Ann and hammer: it is market development because they are trying to create a product for new purposes
2.
for apple: since they are opening mini stores within target they are trying to have an expansion approach where more products and services would be sold to their customers.
3.
for disney: they are diversifying into a new product entirely. ESPN is a well known channel for sporting related activities.
20 points I need help Which tasks are common to all Education and Training career pathways?
Answer:
teaching students and collaborating with teachers on instructional content
Explanation:
Marc and Michelle are married and earned salaries this year of $64,000 and $12,000, respectively. In addition to their salaries, they received interest of $350 from municipal bonds and $500 from corporate bonds. Marc contributed $2,500 to an individual retirement account, and Marc paid alimony to a prior spouse in the amount of $1,500 (under a divorce decree effective June 1, 2005). Marc and Michelle have a 10-year-old son, Matthew, who lived with them throughout the entire year. Thus, Marc and Michelle are allowed to claim a $2,000 child tax credit for Matthew. They are also able to claim $2,900 in recovery rebate credit ($2,400 for Marc and Michelle and $500 for Matthew). Assume they did not receive the recovery rebate in advance. Marc and Michelle paid $6,000 of expenditures that qualify as itemized deductions and they had a total of $3,500 in federal income taxes withheld from their paychecks during the year. (Use the tax rate schedules).
A. What is Marc and Michelle’s gross income?
B. What is Marc and Michelle’s adjusted gross income?
C. What is the total amount of Marc and Michelle’s deductions from AGI?
D. What is Marc and Michelle’s taxable income?
E. What is Marc and Michelle’s taxes payable or refund due for the year?
Answer:
I will use the 2020 tax schedule since recovery rebate credit applies to 2020:
Marc and Michelle's gross income = Marc's and Michelle's salaries + interest from corporate bonds = $64,000 + $12,000 + $500 = $76,500
they should choose the standard deduction since it is higher than their itemized deductions = ($24,400)
contribution to IRA = ($2,500)
alimony payment = ($1,500) the divorce agreement was settled on 2005
Marc and Michelle's taxable income = $48,100
Marc and Michelle's tax liability = $1,975 + [12% x ($48,100 - $19,750)] = $5,377
Interests on municipal bonds is not taxable.
The amount of taxes that they owe = $5,377 - $3,500 (federal tax withholdings) = $1,877
Refundable tax credits:
$2,000 in child tax credit
$2,900 in recovery rebate credit
total = $4,900
taxes payable or refund = tax liability - refundable tax credits = $1,877 - $4,900 = -$3,023.
Marc and Michelle should get a refund for $3,023
4. If you enter your credit card information as a requirement for a "free trial" there is
a possibility you could be charged automatically after the trial period is up.
True
O
False
HELP ME
Answer:
True
Explanation:
If you enter a credit card for a free trial, the card will likely be automatically charged because you have agreed to have your card charged immediately after the free trial period.
Hope this helps! Let me know.
Three explorers are getting kidnapped by an evil tribe deep in the jungle, and their life now depends on their ability to correctly answer the following challenge the evil tribe's chief has for them. The explorers are tied to three trees facing each other and are presented with the chief's 5 wives: 3 brunettes, and 2 blondes. The three explorers are now blindfolded, and the chief picks three of his five wives to stand behind the trees the explorers are tied to, one behind each tree. The remaining two wives disappear from view. Then the blindfolds come off, and each explorer is able to see the two wives that are standing behind his two colleagues, but not the one behind himself. Each explorer now has up to 10 minutes time to think, after which each has to correctly answer what hair color the wife has that is standing behind him, or lose his life. When you, as one of the three explorers, gain your sight after the blindfold comes off, you see two brunettes standing behind your two colleagues. And now your life depends on figuring out who is behind you: a blonde or a brunette?
Answer:
Brunette
Explanation:
Originally there were 3 brunettes and 2 blondes. If once you are able to see, you realize that 2 brunettes are standing behind your friends, that means that behind you there could be one of two blondes or the remaining brunette.
The possibility of the wife behind you being a blonde is 2/3 or 67%, while the chance of her being brunette is only 33%. But this question is not about probability, instead it is about game strategy. I would bet that the wife behind me is a brunette.
Imagine that the two women that you saw were blondes, then you would immediately say brunette. Even if you only saw one blonde wife, your obvious choice would be brunette. This applies to all 3 friends and the chief is gambling against you all 3. He will not give any of you any type of advantage.
The possibility of the wife behind you being a blonde is 2/3 or 67%, while the prospect of her being brunette is barely 33%. But this question isn't about probability, instead, it's about game strategy. I'd bet that the wife behind me could be a brunette.
BrunetteOriginally there have been 3 brunettes and a pair of blondes. If once you're ready to see, you realize that 2 brunettes are standing behind your friends, which means that behind you there may be one in every of two blondes or the remaining brunette. Imagine that the 2 women that you just saw were blondes, then you'd immediately say brunette. Even if you simply saw one blonde wife, your obvious choice would be brunette. So this applies to all or any 3 friends and also the chief is gambling against you all 3. Then He won't give any of you any variety of advantages.
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Sheridan Company sells radios for $50 per unit. The fixed costs are $445000 and the variable costs are 60% of the selling price. As a result of new automated equipment, it is anticipated that fixed costs will increase by $65000 and variable costs will be 50% of the selling price. The new break-even point in units is:
Answer:
Break-even point in units= 2,600
Explanation:
To calculate the break-even point in units, we need to use the following formula:
Break-even point in units= fixed costs/ contribution margin per unit
Fixed costs= $65,000
Contribution margin per unit= 50*0.5= $25
Break-even point in units= 65,000/25
Break-even point in units= 2,600
Every 6 months, Leo Perez takes an inventory of the consumer debts he has outstanding. His latest tally shows that he still owes $4,250 on a home improvement loan (monthly payments of $100); he is making $50 monthly payments on a personal loan with a remaining balance of $825; he has a $1,500, secured single- payment loan that's due late next year; he has a $70,000 home mortgage on which he's making $850 monthly payments; he still owes $12,500 on a new car loan (monthly payments of $550); and he has a $1,200 balance on his Mastercard (minimum payment of $50), a $50 balance on his Shell credit card (balance due in 30 days), and a $500 balance on a personal line of credit ($90 monthly payments).
a. Use Worksheet to prepare an inventory of Leo's consumer debt.
Type of Consumer Debt Creditor Currently Monthly Latest Balance Due
Payment
Auto loans
Personal installment loans
Home improvement loan
Single-payment loans
Credit cards Mastercard
(retail charge cards, bank
cards, T&E Shell cards, etc.)
Personal line of credit $ $
Totals $
b. Find his debt safety ratio, given that his take-home pay is $2,000 per month. Round the answer to 1 decimal place. %
c. Would you consider this ratio to be good or bad?
Answer:
The answer is "87%".
Explanation:
Please find the attached file.
Presented below is information for Headland Company.
1. Beginning-of-the-year Accounts Receivable balance was $21,400.
2. Net sales (all on account) for the year were $105,300. Headland does not offer cash discounts.
3. Collections on accounts receivable during the year were $81,300.
Required:
Compute Headland’s accounts receivable turnover and days to collect receivables for the year.
Answer and Explanation:
The computation is shown below:
For account receivable turnover ratio
Accounts Receivable Turnover is
= Sales ÷ Average Receivables
Beginning Accounts Receivable $21,400
Add: Sales $105,300
Less: Cash Receipts $81,300
Ending Accounts Receivable $45,400
Now
Accounts Receivable Turnover is
= $105,300 ÷ ($21,400 + $45,400) ÷ 2
= 3.15 times
Now days to sell is
= 365 ÷ 3.15 times
=116 days
Sheridan Company pays all salaried employees on a biweekly basis. Overtime pay, however, is paid in the next biweekly period. Sheridan accrues salaries expense only at its December 31 year end. Data relating to salaries earned in December 2020 are as follows: Last payroll was paid on 12/26/20, for the 2-week period ended 12/26/20. Overtime pay earned in the 2-week period ended 12/26/20 was $24000. Remaining work days in 2020 were December 29, 30, 31, on which days there was no overtime. The recurring biweekly salaries total $444000.
Assuming a five-day workweek, Sheridan should record a liability at December 31, 2020 for accrued salaries of:_________.
a. $266400
b. $290400
c. $133200
d. $157200
Answer:Sheridan should record a liability at December 31, 2020 for accrued salaries of =d. $157200
Explanation:
Since there are 5 workdays in a week
we consider First, Workdays Biweekly (Two weeks)
= 5 work days per week X 2 = 10 days
then the Remaining work days in 2020 for December 29,30 and 31 = 3 days
Accrued salaries = Recurring biweekly salaries/10 days X 3 days + Overtime pay earned in the 2-week period ended 12/26/20
$444,000/10 days x 3 days + $24000
$133,200 +$24000
= $157,200
Presented below is information from Headland Computers Incorporated.
July 1 Sold $22,600 of computers to Robertson Company with terms 3/15, n/60. Headland uses the gross method to record cash discounts. Headland estimates allowances of $1,334 will be honored on these sales.
10 Headland received payment from Robertson for the full amount owed from the July transactions.
17 Sold $256,100 in computers and peripherals to The Clark Store with terms of 2/10, n/30.
30 The Clark Store paid Headland for its purchase of July 17.
Omitted question-- Prepare the necessary journal entries for Headland computers
Answer: Please see answers below
Explanation:
Journal to record sales revenue
Date Account and explanation Debit Credit
July 1st Account receivables $22,600
Sales Revenue $22,600
Journal to record allowances for sales returns
July 1st Sales returns and allowances $1,334
Allowances for sales return and allowances $1,334
Journal to record receipt of cash from Robertson within discount period
July 10 Cash $21,922
Sales discount $678
Account receivables $22,600
Calculation
Discount = 22,600 x 3%= $678
Cash = $22,600 - $678= $21,922
Journal to record sales revenue
July 1`7 Account receivables $256,100
Sales revenue $256,100
Journal to record receipt of cash from Clark within discount period
July 30 Cash $250,978
Sales discount $5,122
Account receivables $256,100
Calculation
Discount = 256,100 x 2%= $5,122
Cash = $256,100 -$5,122= $250,978
Potential Market – the set of consumers who profess some level of interest in a defined market offer Mass Market – the set of consumers who profess some level of interest in and have the requisite income to a defined market offer Available Market – the set of consumers with the interest, requisite income and access to a defined marketQualified Available Market – the set of consumers with the interest, requisite income, access and qualifications for a defined market offer offerHonda Ltd. of Japan is reviewing the motorcycle market of a Mid-Pacific island. A recent study revealed twenty percent (20%) of the island's 1,000,000 population exhibited an interest in owning a motorcycle. Of those interested, only fifty percent (50%) have the requisite income to purchase a Honda motorcycle. Three (3) Honda dealerships provide the island’s entire population with access to the defined market offer. However, twenty-five percent (25%) of the interested individuals with the requisite income and access to the defined market offer do not meet the island's minimum license age requirement of eighteen (18) years of age.Calculate the number, not percentage, of the people in each of the following levels of market definition. (Show calculations)a. Potential Marketb. Mass Marketc. Available Marketd. Qualified Available Market
Answer:
A
Potential market
Interested percentage of people x total population
1000000x20%
= 200000
B.
Mass market is potential market x those with requisite income in percentage
= 200000x50%
= 200000x0.5
= 100000
C
Available market is also mass market
= 100000
D.
Qualified market
Available market x minimum qualification in percentage
Percentage of Minimum qualification = 100 - 25%
= 75%
Qualified market = 100000x0.75
= 75000
Transactions for Buyer and SellerShore Co. sold merchandise to Blue Star Co. on account, $112,000, terms FOB shipping point, 2/10, n/30. The cost of the merchandise sold is $67,200. Shore Co. paid freight of $1,800.Journalize Shore Co.'s entry for the sale, purchase, and payment of amount due.Accounts Receivable-Blue Star Co. Sales Cost of Merchandise Sold Merchandise Inventory Common Stock Cash Cash Accounts Receivable-Blue Star Co. Journalize Blue Star Co.'s entry for the sale, purchase, and payment of amount due.Merchandise Inventory Accounts Payable-Shore Co. Accounts Payable-Shore Co. Cash
Answer:
The definition is defined in the clarification portion beneath, as per the particular circumstance.
Explanation:
Correct you're. FOB shipping comments mean that perhaps the shipping can be paid for by consumers. But perhaps the freight is paid by the seller in the question. It would reimburse the freight treated as income from the buyer. The credit including its buyer would be debited with either the deferred revenue sum of freight.Account Titles and Explanation Debit Credit
Receivable accounts -Blue Star Co. $1,800 -
Cash - $1,800
(To record freight paid)
Below are cash transactions for a company, which provides consulting services related to mining of precious metals.
a. Cash used for purchase of office supplies, $1,600.
b. Cash provided from consulting to customers, $42,600.
c. Cash used for purchase of mining equipment, $67,000.
d. Cash provided from long-term borrowing, $54,000.
e. Cash used for payment of employee salaries, $23,400.
f. Cash used for payment of office rent, $11,400.
g. Cash provided from sale of equipment purchased in c. above, $21,900.
h. Cash used to repay a portion of the long-term borrowing in d. above, $37,000.
i. Cash used to pay office utilities, $3,700.
j. Purchase of company vehicle, paying $9,400 cash.
Required:
Calculate cash flows from operating activities.
Answer:
Cash Flow Statement
Cash Flow from Operating Activities
Cash received from customers $42,600
Cash payment to salaries -$23,400
Cash used for purchase of office supplies -$1,600
Office rent paid -$11,400
Payment for office utilities -$3,700
Net Cash Inflow from Operating activities $2,500
Robert G. Flanders Jr., the state-appointed receiver for Central Falls, RI, said his city's declaration of bankruptcy had proved invaluable in helping it cut costs. Before the city declared bankruptcy, he said, he had found it impossible to wring meaningful concessions out of the city's unions and retirees, who were being asked to give up roughly half of the pensions they had earned as the city ran out of cash.
True or False
Answer: false
Explanation:
The alternative to the term of agreement is the declaration of bankruptcy, in which the cities can extract their pensions, it gives a much better alternative. It also increases the bargaining powers of the members of the city. It will help in extracting concessions from the government. It also increases the disagreement value of the city.
Waterway Beauty Corporation manufactures cosmetic products that are sold through a network of sales agents. The agents are paid a commission of 21% of sales. The income statement for the year ending December 31, 2020, is as follows.
WATERWAY BEAUTY CORPORATION
Income Statement
For the Year Ended December 31, 2020
Sales $79,000,000
Cost of goods sold
Variable $32,390,000
Fixed 8,750,000 41,140,000
Gross margin $37,860,000
Selling and marketing expenses
Commissions $16,590,000
Fixed costs 10,607,200 27,197,200
Operating income $10,662,800
The company is considering hiring its own sales staff to replace the network of agents. It will pay its salespeople a commission of 9% and incur additional fixed costs of $9,480,000.
A. Calculate the company’s break-even point in sales dollars for the year 2017 if it hires its own sales force to replace the network of agents.
B. Calculate the degree of operating leverage at sales of $78,800,000 if (1) Bonita Beauty uses sales agents, and (2) Bonita Beauty employs its own sales staff.
C. Calculate the estimated sales volume in sales dollars that would generate an identical net income for the year ending December 31, 2017, regardless of whether Bonita Beauty Corporation employs its own sales staff and pays them an 10% commission or continues to use the independent network of agents.
Answer:
a) total sales = $79,000,000
variable costs:
COGS $32,390,000commissions $7,110,000total variable costs = $39,350,000contribution margin ratio = $39,350,000 / $79,000,000 = 0.5
total fixed costs = $8,750,000 + $10,607,200 + $9,480,000 = $28,837,200
break even point = $28,837,200 / 0.5 = $57,674,400
b) one of the formulas that we can use to calculate the degree of operating leverage is:
operating leverage = fixed costs / total costs
1) total costs using sales agents = $8,750,000 + $10,607,200 + ($78,800,000 x 0.62) = $68,213,200
total fixed costs = $8,750,000 + $10,607,200 = $19,357,200
degree of operating leverage = $19,357,200 / $68,213,200 = 28.38%
2) total costs employing its own sales staff = ($78,800,000 x 0.5) + $8,750,000 + $10,607,200 + $9,480,000 = $68,237,200
total fixed costs = $28,837,200
degree of operating leverage = $28,837,200 / $68,237,200 = 42.26%
c) when the sales level is $79,000,000, the operating income for both alternatives is $10,662,800
($79,000,000 x 0.5) - $28,837,200 = $10,662,800
($79,000,000 x 0.38) - $19,357,200 = $10,662,800
Answer:
A or D
Explanation:
Cheyenne Company has decided to expand its operations. The bookkeeper recently completed the following balance sheet in order to obtain additional funds for expansion.
CHEYENNE COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
Current assets
Cash $237,000
Accounts receivable (net) 347,000
Inventory (lower-of-average-cost-or-market) 408,000
Equity investments (marketable)-at cost (fair value $127,000) 147,000
Property, plant, and equipment Buildings (net) 577,000
Equipment (net) 167,000
Land held for future use 182,000
Intangible assets Goodwill 87,000
Cash surrender value of life insurance 97,000
Prepaid expenses 19,000
Current liabilities Accounts payable 142,000
Notes payable (due next year) 132,000
Pension obligation 89,000
Rent payable 56,000
Premium on bonds payable 60,000
Long-term liabilities Bonds payable 507,000
Stockholders’ equity Common stock, $1.00 par, authorized 400,000 shares, issued 297,000 297,000
Additional paid-in capital 167,000 Retained earnings.
Required:
Prepare a revised balance sheet given the available information.
Answer:
Cheyenne Company
CHEYENNE COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
ASSETS
Current assets :
Cash $237,000
Accounts receivable (net) 347,000
Inventory (LCM) 408,000
Marketable Investments 127,000
Cash surrender
value of life insurance 97,000
Prepaid expenses 19,000
Total current assets $1,235,000 $1,235,000
Property, plant, and
equipment Buildings (net) 577,000
Equipment (net) 167,000
Land held for future use 182,000
Intangible assets Goodwill 87,000
Total long-term assets $1,013,000 $1,013,000
Total assets $2,248,000
LIABILITIES & EQUITY
Current liabilities:
Accounts payable 142,000
Notes payable (short-term) 132,000
Pension obligation 89,000
Rent payable 56,000
Premium on bonds payable 60,000
Total current liabilities $479,000 $479,000
Long-term liabilities
Bonds payable 507,000 $507,000
Total liabilities $986,000
Stockholders’ equity
Common stock, $1.00 par,
authorized 400,000 shares,
issued 297,000 297,000
Additional paid-in capital 167,000
Retained earnings 798,000
Total Equity $1,262,000 $1,262,000
Total liabilities & Stockholders' equity $2,248,000
Explanation:
CHEYENNE COMPANY BALANCE SHEET FOR THE YEAR ENDED 2020
Current assets
Cash $237,000
Accounts receivable (net) 347,000
Inventory (LCM) 408,000
Marketable Investments 127,000
Cash surrender
value of life insurance 97,000
Prepaid expenses 19,000
Property, plant, and
equipment Buildings (net) 577,000
Equipment (net) 167,000
Land held for future use 182,000
Intangible assets Goodwill 87,000
Current liabilities
Accounts payable 142,000
Notes payable (short-term) 132,000
Pension obligation 89,000
Rent payable 56,000
Premium on bonds payable 60,000
Long-term liabilities
Bonds payable 507,000
Stockholders’ equity
Common stock, $1.00 par,
authorized 400,000 shares,
issued 297,000 297,000
Additional paid-in capital 167,000
Retained earnings ?
Total assets - Liabilities = Total Equity
= 2,248,000 - 986,000
= 1,262,000
Retained Earnings = Total Equity - (Common Stock + APIC)
= 1,262,000 - (297,000 + 167,000)
= $798,000
Gayne Corporation's contribution margin ratio is 18% and its fixed monthly expenses are $53,500. If the company's sales for a month are $318,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expenses do not change.
Answer:
$3,740
Explanation:
The computation of net operating income is shown below:-
Contribution margin = Sales × CM ratio
= $318,000 × 18%
= $57,240
Net operating income = Contribution margin - fixed assets
= $57,240 - $53,300
= $3,740
So, we have applied the above formula.
Hence, the net operating income is $3,740 and the same is to be considered
The opportunity cost of making a component part in a factory with no excess capacity is the: (CMA adapted)
Answer:
Answer Choices
The opportunity cost of making a component part in a factory with no excess capacity is the
(A) Variable manufacturing cost of the component.
(B) Fixed manufacturing cost of the component.
(C) Cost of the production given up in order to manufacture the component.
(D) Net benefit given up from the best alternative use of the capacity.
Answer is D
Net benefit given up from the best alternative use of the capacity.
Explanation:
When we talk about opportunity cost, we simply look at the potential benefits a business, investor or person could miss when selecting a particular alternative over another. This is a major concept in economics.
If one is not careful, opportunity costs can be readily overlooked and when one tries to understand the missed opportunities in choosing one option over another, that individual would be able to make better decisions.
Question 5
1 pts
The optimal level of inflation is not zero
True
False
How is an index fund different than an exchange-traded fund?
Answer:The key differences between index ETFs and index funds is ETFs trade throughout the day while index funds trade once at market close. ETFs are often cheaper than index funds if bought commission-free. Index funds often have higher minimum investments than ETFs.
Explanation: The key differences between index ETFs and index funds is ETFs trade throughout the day while index funds trade once at market close. ETFs are often cheaper than index funds if bought commission-free. Index funds often have higher minimum investments than ETFs.
All of the current year's entries for Zimmerman Company have been made, except the following adjusting entries. The company's annual accounting year ends on December 31
On September 1 of the current year, Zimmerman collected six months' rent of $8,520 on storage space. At that date, Zimmerman debited Cash and credited Unearned Rent Revenue for $8,520.
On October 1 of the current year, the company borrowed $13,200 from a local bank and signed a one-year, 12 percent note for that amount. The principal and interest are payable on the maturity date.
Depreciation of $3,000 must be recognized on a service truck purchased in July of the current year at a cost of $24,000.
Cash of $3,600 was collected on November of the current year, for services to be rendered evenly over the next year beginning on November 1 of the current year. Unearned Service Revenue was credited when the cash was received.
On November 1 of the current year, Zimmerman paid a one-year premium for property insurance, $9,960, for coverage starting on that date. Cash was credited and Prepaid Insurance was debited for this amount.
The company earned service revenue of $4,200 on a special job that was completed December 29 of the current year. Collection will be made during January of the next year. No entry has been recorded.
At December 31 of the current year, wages earned by employees totaled $13,700. The employees will be paid on the next payroll date in January of the next year.
On December 31 of the current year, the company estimated it owed $490 for this year's property taxes on land. The tax will be paid when the bill is received in January of next year.
2. Using the following headings, indicate the effect of each adjusting entry and the amount of the effect. Use + for increase, − for decrease. (Reminder: Assets = Liabilities + Stockholders’ Equity; Revenues – Expenses = Net Income; and Net Income accounts are closed to Retained Earnings, a part of Stockholders’ Equity.)
Answer:
1) adjusting entries
a. On September 1 of the current year, Zimmerman collected six months' rent of $8,520 on storage space. At that date, Zimmerman debited Cash and credited Unearned Rent Revenue for $8,520.
Dr Unearned rental revenue 5,500
Cr Rental revenue 5,500
b. On October 1 of the current year, the company borrowed $13,200 from a local bank and signed a one-year, 12 percent note for that amount. The principal and interest are payable on the maturity date.
Dr Interest expense 396
Cr Interest payable 396
c. Depreciation of $3,000 must be recognized on a service truck purchased in July of the current year at a cost of $24,000.
Dr Depreciation expense 3,000
Cr Accumulated depreciation 3,000
d. Cash of $3,600 was collected on November of the current year, for services to be rendered evenly over the next year beginning on November 1 of the current year. Unearned Service Revenue was credited when the cash was received.
Dr Unearned service revenue 600
Cr Service revenue 600
e. On November 1 of the current year, Zimmerman paid a one-year premium for property insurance, $9,960, for coverage starting on that date. Cash was credited and Prepaid Insurance was debited for this amount.
Dr Insurance expense 1,660
Cr Prepaid insurance 1,660
f. The company earned service revenue of $4,200 on a special job that was completed December 29 of the current year. Collection will be made during January of the next year. No entry has been recorded.
Dr Accounts receivable 4,200
Cr Service revenue 4,200
g. At December 31 of the current year, wages earned by employees totaled $13,700. The employees will be paid on the next payroll date in January of the next year.
Dr Wages expense 13,700
Cr Wages payable 13,700
h. On December 31 of the current year, the company estimated it owed $490 for this year's property taxes on land. The tax will be paid when the bill is received in January of next year.
Dr Property taxes expense 490
Cr Property taxes payable 490
2) Assets = Liabilities + Stockholders’ Revenues - Expenses = Net
Equity Income
a. na - + + na +
b. na - - na - -
c. - na - na - -
d. na - + + na +
e. - na - na - -
f. + na + + na +
g. na + - na - -
h. na + - na - -
Comfort chair company manufacturers a standard recliner. During February, the firm's Assembly Department started production of 73,000 chairs. During the month, the firm completed 78,000 chairs, and transferred them to the Finishing Department. The firm ended the month with 10,000 chairs in ending inventory. All direct materials costs are added at the beginning of the production cycle and conversion costs are added uniformly throughout the production process. The FIFO method of process costing is used by Comfort. Beginning work in process was 30% complete as to conversion costs, while ending work in process was 80% complete as to conversion costs.
Beginning inventory:
DIrect materials $24,000
Conversion costs $35,000
Manufacturing costs added during the accounting period:
Direct materials $168,000
Conversion costs $278,000
1. What were the equivalent units for conversion costs during February? (HINT: The answer is 81,500, but I need work to support this)
2. What is the amount of direct materials cost assigned to ending work-in-process inventory at the end of February? (HINT: The answer is $23,000, but I need work to support this)
Answer:
1) total equivalent units:
materials = 73,000
conversion = 81,500
2) costs assigned to ending WIP:
materials = $23,013.70
conversion = $27,288.32
Explanation:
beginning WIP 78,000 + 10,000 - 73,000 = 15,000
materials = 100% (0 added during the period)
conversion = 30% (70% added during the period, 10,500 EU)
units started 73,000
units finished 78,000
units started and finished = 63,000
ending WIP 10,000
materials = 100%
conversion = 80%, 8,000 EU
Beginning WIP
Materials $24,000
Conversion $35,000
Costs added during the period:
Materials $168,000
Conversion $278,000
total equivalent units:
materials = 73,000
conversion = 10,500 + 63,000 + 8,000 = 81,500
cost per EU:
Materials = $168,000 / 73,000 = $2.30137
Conversion = $278,000 / 81,500 = $3.41104
costs assigned to ending WIP:
materials = 10,000 x $2.30137 = $23,013.70
conversion = 8,000 x $3.41104 = $27,288.32
In 1993, Tamarisk Company completed the construction of a building at a cost of $2,320,000 and first occupied it in January 1994. It was estimated that the building will have a useful life of 40 years and a salvage value of $68,800 at the end of that time. Early in 2004, an addition to the building was constructed at a cost of $580,000. At that time, it was estimated that the remaining life of the building would be, as originally estimated, an additional 30 years, and that the addition would have a life of 30 years and a salvage value of $23,200. In 2022, it is determined that the probable life of the building and addition will extend to the end of 2053, or 20 years beyond the original estimate.
Required:
a. Using the straight-line method, compute the annual depreciation that would have been charged from 1994 through 2003.
b. Compute the annual depreciation that would have been charged from 2004 through 2022.
c. Prepare the entry, if necessary, to adjust the account balances because of the revision of the estimated.
d. Compute the annual depreciation to be charged, beginning with 2022.
Answer:
a. Using the straight-line method, compute the annual depreciation that would have been charged from 1994 through 2003.
depreciable value = $2,320,000 - $68,800 = $2,251,200
annual depreciation expense = $2,251,200 / 40 years = $56,280
b. Compute the annual depreciation that would have been charged from 2004 through 2022.
annual depreciation expense = $56,280 + [($580,000 - $23,200) / 30 years] = $74,840
c. Prepare the entry, if necessary, to adjust the account balances because of the revision of the estimated.
no journal entry required, the carrying value is the same, only the annual depreciation expense will change
d. Compute the annual depreciation to be charged, beginning with 2022.
accumulated depreciation until 2022 = (10 years x $56,280) + (18 x $74,840) = $1,909,920
carrying value = ($2,320,000 + $580,000) - $1,909,920 = $2,900,000 - $1,909,920 = $990,080
depreciable value = $990,080 - $68,800 - $23,200 = $898,080
annual depreciation = $898,080 / 32 years = $28,065