The Manda Panda Company uses the allowance method to account for bad debts. At the beginning of 2018, the allowance account had a credit balance of $96,950. Credit sales for 2018 totaled $3,150,000 and the year-end accounts receivable balance was $537,500. During this year, $94,250 in receivables were determined to be uncollectible. Manda Panda anticipates that 3% of all credit sales will ultimately become uncollectible. The fiscal year ends on December 31.

Required:
a. Does this situation describe a loss contingency? Explain.
b. What is the bad debt expense that Manda Panda should report in its 2018 income statement?
c. Prepare the appropriate journal entry to record the contingency.
d. What is the net realizable value (book value) Manda Panda should report in its 2018 balance sheet?

Answer:

a. Does this situation describe a loss contingency? Explain.

Allowance for doubtful accounts are a loss contingency since they mar or may not happen, but the company has to account for them.

b. What is the bad debt expense that Manda Panda should report in its 2018 income statement?

total bad debt expense = total sales x 3% = $3,150,000 x 3% = $94,500

c. Prepare the appropriate journal entry to record the contingency.

Dr Bad debt expense 94,500

    Cr Allowance for doubtful accounts 94,500

d. What is the net realizable value (book value) Manda Panda should report in its 2018 balance sheet?

ending balance of accounts receivable = $537,500 - $94,500 = $443,000

Green marketing refers to:________
A) the purchasing of products from producers whose farming practices are Fair Trade certified.
B) the marketing efforts taken by new and smaller companies that lack both the experience and resources of their major competitors.
C) the marketing efforts to produce,promote,and reclaim environmentally sensitive products.
D) the marketing of products that have in no way been altered or reprocessed by artificial means.
E) the marketing of those products made exclusively from recycled materials.

Markel entered into a contract with Jaylin to paint a portrait for her in consideration of $600. This contract was freely negotiated. There was nothing in the terms of the agreement about when Markel had to start on the portrait or how long it should take him to finish. It took Markel a long time to complete the portrait, almost 18 months. Which of the following is true of this contract?

a. It must be in writing because it took longer than one year to complete.
b. It must be in writing because it was for more than $500.
c. It is a unilateral contract.
d. The contract need not be in writing.

You have received two bids from outside companies to conduct guest satisfaction surveys for you. You want at least 320 responses. Company A charges $3,200 + $6 per respondent. Company B charges $4,000 + $3 per respondent. Which company will cost you less?

a) Company A
b) Company B

Use the following information to answer this question.
Bayside, Inc. 2010 Income Statement ($ in thousands)
Net sales $ 5,970
Less: Cost of goods sold 4,320
Less: Depreciation 340
Earnings before interest and taxes 1,310
Less: Interest paid 33
Taxable Income $ 1,277
Less: Taxes 447
Net income $ 830
Bayside, Inc. 2009 and 2010 Balance Sheets ($ in thousands)
2009 2010 2009 2010
Cash $ 90 $195 Accounts payable $ 1,480 $ 1,455
Accounts rec. 980 820 Long-term debt 770 570
Inventory 1,585 2,020 Common stock $ 3,205 $ 3,240
Total $ 2,655 $ 3,035 Retained earnings 840 1,090
Net fixed assets3,640 3,320
Total assets $ 6,295 $ 6,355 Total liab. & equity $ 6,295 $ 6,355
How many dollars of sales are being generated from every dollar of fixed assets? (use 2010 values)
a. $1.72
b. $0.94
c. $0.95
d. $1.64
e. $1.80

The Osgood county refuse department runs two recycling centers. Center 1 costs $40 to run for an eight hour day. In a typical day, 140 pounds of glass and 60 pounds of aluminum are deposited at Center 1. Center 2 costs $50 for an eight hour day, with 100lbs of glass and 180lbs of aluminum deposited per day. The county has a commitment to deliver at least 1540lbs of glass and 1440lbs of aluminum per week. How many days per week should the county open each center to minimize its cost and still meet the requirements?

What may make a small business loan challenging to obtain? List at least two potential obstacles.

The production possibilities frontier will shift outward
A.
if resources are used to produce consumption goods.
B.
if production occurs outside the production possibilities frontier.
C.
if resources are not used in production.
D.
.if resources are not used to produce capital goods
E.
.if technological advances occur

Metallica Bearings, Inc., is a young start-up company. No dividends will be paid on the stock over the next 11 years because the firm needs to plow back its earnings to fuel growth. The company will then pay a dividend of $16.25 per share 12 years from today and will increase the dividend by 5.5 percent per year thereafter. The required return on the stock is 13.5 percent. What is the price of the stock 11 years from today?

Adjusting Entries and Adjusted Trial Balances
Emerson Company is a small editorial services company owned and operated by Suzanne Emerson. On October 31, 20Y6, Emerson Company's accounting clerk prepared the following unadjusted trial balance:
Emerson Company
Unadjusted Trial Balance
October 31, 20Y6
Debit Credit
Balances Balances
Cash 3,930
Accounts Receivable 35,640
Prepaid Insurance 6,640
Supplies 1,810
Land 104,800
Building 269,090
Accumulated Depreciation—Building 128,060
Equipment 125,950
Accumulated Depreciation—Equipment 91,210
Accounts Payable 11,180
Unearned Rent 6,340
Suzanne Emerson, Capital 285,400
Suzanne Emerson, Drawing 13,890
Fees Earned 302,030
Salaries and Wages Expense 180,010
Utilities Expense 39,570
Advertising Expense 21,140
Repairs Expense 16,010
Miscellaneous Expense 5,740
824,220 824,220
The data needed to determine year-end adjustments are as follows:
Unexpired insurance at October 31, $4,450.
Supplies on hand at October 31, $540.
Depreciation of building for the year, $2,950.
Depreciation of equipment for the year, $2,550.
Unearned rent at October 31, $1,650.
Accrued salaries and wages at October 31, $2,880.
Fees earned but unbilled on October 31, $16,910.
Required:
1. Journalize the adjusting entries using the following additional accounts: Salaries and Wages Payable; Rent Revenue; Insurance Expense; Depreciation Expense—Building; Depreciation Expense—Equipment; and Supplies Expense. If an amount box does not require an entry, leave it blank.
2. Determine the balances of the accounts affected by the adjusting entries and prepare an adjusted trial balance.

A mortgage is a document in which a lender reclaims a property due to lack of payment by the borrower.

True
False

All of the following are examples of primary market research EXCEPT

Direct mail surveys

Fee product samples

Focus groups

Promotional email campaigns

Which of the following is not a way to improve your credit?
Keep your balances low
Move debt around
Keep established accounts
Pay your bills on time

you have $26,605.46 in a brokerage account, and you plan to deposit an additional $5,000 at the end of every future year until your account totals $270,000. you expect to earn 10% annually on the account. how many years will it take to reach your goal? do not round intermediate calculations. round your answer to the nearest whole number.

The August 31 balance shown on the bank statement is $9,813.

a. There is a deposit in transit of $1,263 at August 31.
b. Outstanding checks at August 31 totaled $1,877.
c. Interest credited to the account during August but not recorded on the company's books amounted to $116.
d. A bank charge of $35 for checks was made to the account during August. Although the company was expecting a charge, the amount was not known until the bank statement arrived.
e. In the process of reviewing the canceled checks, it was determined that a check issued to a supplier in payment of accounts payable of $626 had been recorded as a disbursement of $373. The August 31 balance in the general ledger Cash account, before reconciliation, is $9,371.

Required:
Prepare a bank reconciliation as of August 31 from the above information.

Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 60,000 of these balls, with the following results:

Sales (60,000 balls) $1,500,000
Variable expenses 900,000
Contribution margin 600,000
Fixed expenses 375,000
Net operating income $225,000

Required:
a. Compute the CM ratio and the break-even point in balls.
b. Compute the the degree of operating leverage at last year

Don operates a taxi business, and this year one of his taxis was damaged in a traffic accident. The taxi was originally purchased for $15,500 and the adjusted basis was $1,050 at the time of the accident. The taxi was repaired at a cost of $2,975 and insurance reimbursed Don $757 of this cost. What is the amount of Don's casualty loss deduction

You are asked to study the causal effect of hours spent on employee training (measured in hours per worker per week) in a manufacturing plant on the productivity of its workers (output per worker per hour). Describe EITHER ONE a-an ideal randomized controlled experiment to measure this causal effect.

Now imagine that Tiger Pros is 60% financed with equity and 40% financed with debt. Cost of equity is 16.5% and after-tax cost of debt is 11%. It has the same perpetual EBIT of $500 a year but has a $120 perpetual interest expense. The firm is subject to a 21% tax rate. What is the market value of Tiger Pros

Which of the following types of insurance allows individuals to keep a former employer's group coverage for a set period of time?
COBRA
Individual health insurance
Hospital indemnity policy
Group health insurance

what is Amazon's current price-to-book value?

Black Bear Construction Company has a contract to construct a $6,000,000 bridge at an estimated cost of $5,300,000. The contract is to start in July 2017, and the bridge is to be completed in October 2019. The following data pertain to the construction period.

2015 2016 2017
Costs to date $1,325,000 $3,780,000 $5,430,000
Estimated costs to complete 3,975,0001, 620,000 —
Progress billings during the year 1,200,000 3,200,000 1,600,000
Cash collected during the year 1,000,000 2,340,000 2,660,000

What amount of gross profit should Black Bear recognize in 2017 using the percentage-of-completion method?

a. $150,000
b. $169,000
c. $210,000
d. $530,000

Adams Company has two products: A and B. The annual production and sales of Product A is 2,300 units and of Product B is 1,700 units. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.3 direct labor-hours per unit and Product B requires 0.6 direct labor-hours per unit. The total estimated overhead for next period is $105,475.
The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports. The new activity-based costing system would have three overhead activity cost pools--Activity 1, Activity 2, and General Factory--with estimated overhead costs and expected activity as follows:
Total Estimated
Overhead
Costs Expected Activity
Product A Product B Total
Activity 1 $32,592 1,600 1,200 2,800
Activity 2 18,564 2,300 800 3,100
General Factory54,319 690 1,020 1,710
Total $105,475
(Note: The General Factory activity cost pool's costs are allocated on the basis of direct labor-hours.)
The overhead cost per unit of Product B under the traditional costing system is closest to:________.
a. $20.30
b. $14.62
c. $16.71
d. $37.01

I. Prepare a journal entry.
(a) Stockholder invests $15,000 into the business.
(b) Company borrows $15,000 signing a note payable to the bank that is due in three months.
(c) Receives and pays for a $10,000 truck and $5,000 of equipment.
(d) Purchases $600 of supplies on account.
(e) Signs contract for first website design for $10,000.
(f) Pays $200 to the supplier in (d).
(g) Purchases and pays for $400 of supplies.
(i) Orders a $900 computer, to be delivered in 90 days.
Transaction # Accounts titles (names) Debit Credit
II. Post the transactions to ledger accounts and then determine the ending balances of each of the following T-accounts.
Assets Liabilities Stockholders' Equity
Cash Accounts Payable Common Stock
Supplies Notes Payable Retained Earnings
Equipment
3. PREPARING A TRIAL BALANCE AND A CLASSIFIED BALANCE SHEET
Use the ending balances from the T-accounts to prepare a trial balance as of December 31, Year 1.
World Wide Webster
Trial Balance
At December 31, Year 1

Precision Castparts, a manufacturer of processed engine parts in the automotive and airline industries, borrows $40.2 million cash on October 1, 2021, to provide working capital for anticipated expansion. Precision signs a one-year, 7% promissory note to Midwest Bank under a prearranged short-term line of credit. Interest on the note is payable at maturity. Each firm has a December 31 year-end.

Required:
a. Prepare the journal entries on October 1, 2021, to record (a) the notes payable for Precision Castparts and (b) the notes receivable for Midwest Bank.
2. Record the adjustments on December 31, 2021, for (a) Precision Castparts and (b) Midwest Bank.
3. Prepare the journal entries on September 30, 2021, to record payment of (a) the notes payable for Precision Castparts and (b) the notes receivable for Midwest Bank.

The following balance sheet for the Hubbard Corporation was prepared by the company:

HUBBARD CORPORATION
Balance Sheet
At December 31, 2021
Assets
Buildings $754,000
Land 262,000
Cash 64,000
Accounts receivable (net) 128,000
Inventory 248,000
Machinery 284,000
Patent (net) 104,000
Investment in equity securities 68,000
Total assets $1,912,000

Liabilities and Shareholders' Equity
Accounts payable $219,000
Accumulated depreciation 259,000
Notes payable 508,000
Appreciation of inventory 84,000
Common stock (authorized and issued
104,000 shares of no par stock) 416,000
Retained earnings 426,000
Total liabilities and shareholders' equity $1,912,000

Additional information:
The buildings, land, and machinery are all stated at cost except for a parcel of land that the company is holding for future sale. The land originally cost $54,000 but, due to a significant increase in market value, is listed at $128,000. The increase in the land account was credited to retained earnings. The investment in equity securities account consists of stocks of other corporations and are recorded at cost, $24,000 of which will be sold in the coming year. The remainder will be held indefinitely. Notes payable are all long term. However, a $140,000 note requires an installment payment of $35,000 due in the coming year. Inventory is recorded at current resale value. The original cost of the inventory is $164,000.

Required:
Prepare a corrected classified balance sheet for the Hubbard Corporation at December 31, 2018.

A manufacturing plant that assembles television sets has variable output volume from 200 sets to 350 sets a day. The building for both manufacturing and warehousing has an area of 80,000 square feet. It employs about 250 people. It produces all of the components that go into the assembly. An example for variable cost in this plant is ___________________. Group of answer choices building cost equipment cost labor cost property taxes

Some firms pool overhead into a single plantwide overhead pool, while others accumulate overhead costs into manufacturing departments, each of which has an overhead cost pool and overhead cost application rate. Which approach is likely to provide more accurate cost numbers for cost estimating, pricing, and performance evaluation?

A company currently using an inspection process in its material receiving department is trying to install an overall cost reduction program. One possible reduction is the elimination of one inspection position. This position test material has a defective content on the average of 0.04. By inspecting all items, the inspector is able to remove all defects. The inspector can inspect 50 units per hour. The hourly rate including fringe benefits for this position is $9. If the inspection position is eliminated, defects will go into product assembly and will have to be replaced later at a cost of $10 each when they are detected in final product testing.

Required:
a. If the inspector position is eliminated, what will the hourly cost of defects be?
b. Should this inspection position be eliminated?
c. What is the cost to inspect each unit?
d. Is there benefit (or loss) from the current inspection process? How much?

Use the following information available as of December 31 to prepare an income statement for the year and a balance sheet for Goldie Company.
Fees for services performed during the year, $123,000
Accounts payable, $17,800
Accounts receivable, $17,400
Miscellaneous expenses for the year, $9,000
Supplies on hand, $3,300
Notes payable, $25,000
Interest expense on the note for the year, $3,700
Equipment, $92,700
Cash on hand, $11,600
Salaries expense for the year, $71,500
Supplies expense for the year, $8,500
Rent expense for the year, $11,100
Common stock that has been issued, $55,000
Retained earnings at the end of the year, $27,200

The trial balance of Woods Company includes the following balance sheet accounts. Identify the accounts that might require adjustment. For each account that requires adjustment, indicate (1) the type of adjusting entry and (2) the related account in the adjusting entry.

Account Type of Adjustment Related Account
(a) Accounts Receivable Prepaid ExpensesAccrued RevenuesNot requiredAccrued ExpensesUnearned Revenues Interest ExpenseInsurance ExpenseService RevenueNot requiredDepreciation Expense
(b) Prepaid Insurance Unearned RevenuesAccrued RevenuesPrepaid ExpensesNot requiredAccrued Expenses Service RevenueInsurance ExpenseNot requiredDepreciation ExpenseInterest Expense
(c) Equipment Accrued RevenuesNot requiredPrepaid ExpensesAccrued ExpensesUnearned Revenues Interest ExpenseService RevenueDepreciation ExpenseInsurance ExpenseNot required
(d) Accumulated Depreciation's Equipment Prepaid ExpensesAccrued RevenuesNot requiredAccrued ExpensesUnearned Revenues Depreciation ExpenseService RevenueNot requiredInsurance ExpenseInterest Expense
(e) Notes Payable Not requiredUnearned RevenuesAccrued ExpensesAccrued RevenuesPrepaid Expenses Interest ExpenseNot requiredInsurance ExpenseService RevenueDepreciation Expense
(f) Interest Payable Prepaid ExpensesNot requiredAccrued RevenuesUnearned RevenuesAccrued Expenses Insurance ExpenseNot requiredDepreciation ExpenseInterest ExpenseService Revenue
(g) Unearned Service Revenue Unearned RevenuesPrepaid ExpensesAccrued ExpensesAccrued RevenuesNot required Not requiredDepreciation ExpenseService RevenueInterest ExpenseInsurance Expense