Answer:
Woods Company
Accounts Requiring Adjustment, Type of Adjusting Entry, and the Related Account:
Account Type of Adjustment Related Account
a) Account receivable Accrued revenue Service revenue
b) Prepaid insurance Prepaid expense Insurance expense
c) Equipment Not required Not required
d) Accumulated depreciation Accrued expense Depreciation expense
e) Notes Payable Not required Not required
f) Interest Payable Accrued expense Interest expense
g) Unearned service revenue Unearned revenue Service revenue
Explanation:
End of period adjustments are made to accounts in order to bring them in line with the accrual concept and matching principle of accounting. These principles require that expenses and revenues for the period are matched in order to determine the appropriate profit generated for the period. The implication is that transactions are recorded when they are incurred and not when cash is exchanged. For example, if rent expense is incurred for the year and payment is made in the following year, the expense must be recognized in the current year. The same applies to revenue.
During 2016, Sigma Company earned service revenue amounting to $900,000, of which $695,000 was collected in cash; the balance will be collected in January 2017. Also in 2016 there were collections of cash prior to the delivery of goods/services totaling $8,200. What amount should the 2016 income statement report for service revenues
Answer:
$900,000
Explanation:
Based on the information given we were told that During the year 2016, the Company earned service revenue that was amounting to the amount of $900,000 which means that the amount that the year 2016 income statement should report for service revenues is the amount of $900,000 which was the service revenue that was earned by the company in year 2016.
Therefore the amount 2016 income statement
should report for service revenues will be $900,000.
The focus groupis meeting on Tuesday.The policy is too old; itneeds to be revised.The management teamwants to hire new warehouse workers.If the customerbuys four or more items from the catalog, offer a price reduction.We should bothfeel comfortable with the final decision.The corporate directorsrecommends a full investigation.The board of directorshas approved the current ethics policy.The regional manager and the district supervisormakes all purchasing decisions.The writer of a well-designed e-mail messageuse correct grammar and spelling.The initial proposals the team submitted how hard they have worked.
Answer:
The verbs in these sentences are:
1. is
2. needs
3. wants
4. buys
5. feel
6. recommend
7. has
8. makes
9. uses
10. shows
Explanation:
Verb is a word in a sentence which describes an action of a person. It is the word which gives understanding about the task performance in a sentence. The verb can be single or multiple in a single sentence. The choice of verb is dependent on the noun. There are 4 forms of verb which are used in a sentence.
Let’s return to Tenisa and Randolf Singh and their retail and decorating business, Comfy Home.Comfy Home is a retail business selling a broad range of homeware, kitchen, and electrical appliances to consumers and small businesses. In addition to the home and kitchen appliances, Comfy Home makes and sells home decorating items including artisanal candles and holiday arrangements. The company has two stores located in the small city of Warmtown, USA. Its downtown store offers decorating services to the banks and small businesses in the vicinity. Tenisa Singh handles the candle making and decorating side of the business while Randolf Singh managers the stores. The business is wholly owned by Tenisa and Randolf Singh and was started by the couple in 2014.
As part of Comfy Home’sprepaid assets, there is a yearly insurance premium of $12,000. The new year has begun and Comfy Home’s accountant is preparing journal entries for the month of January. She has learned from Randolf that the insurance premium for this year is the same as for last year and was paid in cash on January 2, 2018 for the new year. What are the journal entries that the accountant will make at the end of the month of January to reflect the activity(ies) related to Comfy Home’s insurance?
Answer:
Comfy Home
Journal Entries:
Date Account Title Debit Credit
Jan. 31 Insurance Expense $1,000
Prepaid Insurance $1,000
To record the insurance expense for January.
Previously:
Jan. 2 Prepaid Insurance $12,000
Cash $12,000
To record the prepayment for insurance premium.
Explanation:
Insurance Expense for each month is calculated as Prepaid Insurance/Period of prepayment. This is equal to $12,000/12 = $1,000. This implies that every month's account will be debited with $1,000 for Insurance Expense, while the Prepaid Insurance (asset) is credited to account for the use of the asset for the period (month). For January's balance sheet, the Prepaid Insurance balance will be $11,000 ($12,000 - $1,000).
The U.S. Supreme Court hears cases that involve A. Tort cases B. Criminal cases C. Civil cases D. Constitutional cases
Healy Corporation recorded service revenues of $200,000 in 2014, of which $80,000 were on credit and $120,000 were for cash. Moreover, of the $80,000 credit sales for 2014, Healy collected $20,000 cash on those receivables before year-end 2014. The company also paid $40,000 cash for 2014 wages. Its employees also earned another $20,000 in wages for 2014, which were not yet paid at year-end 2014.
Compute the company’s net income for 2014.
Answer:
$140,000
Explanation:
Computation of the company’s net income for 2014.
Using this formula
Net income=Revenue – Expenses
Let plug in the formula
Net income=$200,000 - $40,000+$20,000
Net income= $140,000
Therefore the company’s net income for 2014 will be $140,000
Answer:
$140,000
Explanation:
The following errors took place in journalizing and posting transactions:
Insurance of $18,800 paid for the current year was recorded as a debit to Insurance Expense and a credit to Prepaid Insurance. Dividends of $18,000 were recorded as a debit to Wages Expense and a credit to Cash. Journalize the entries to correct the errors.
Answer:
Journal 1
Debit : Prepaid Expense $37,600
Credit : Cash $18,800
Credit : Insurance Expense $18,800
Journal 2
Debit : Dividends $18,000
Credit : Wages $18,000
Explanation:
Journal 1
The first error has to be corrected by debiting the Prepaid Expenses by twice the amount paid to cancel the effect of a credit entry made to that account. Cash is credited to show the correct credit entry that was supposed to be made. Insurance expense is credited to cancel the debit entry made to this account in error.
Journal 2
The error made is called error of principle. This is were the transaction is recorded in the wrong class of accounts. Simply, Debit the Dividends and credit the Wages Account to record and reverse the error out of the Wages Account into the Dividends Account.
A television assembly plant has a variable production output ranging from 200 sets to 850 sets a day. The building for both manufacturing and warehousing has an area of 80,000 square feet and is leased from a real estate firm at an annual rate of $7.95 per square foot. It employs 250 people and their wage cost is, in large part, a function of the number of televisions produced. Most of the components that go into the assembly are also produced in the plant with in-house equipment that is operated based on production requirements. The most likely example of fixed cost in this plant is ______________.
Answer:
Annual rental rate
$636,000
Explanation:
Fixed cost is cost that does not vary with output. An example of fixed cost is rent
The annual rental rate is a fixed cost because it does not vary with output.
Variable cost is cost that varies with output. If output is zero, no variable cost would be incurred. An example of variable cost is wages
The wages paid to labour is a variable cost
Use the following data to determine the total amount of working capital.Koonce Office SuppliesBalance SheetDecember 31, 2012Cash $ 130,000 Accounts Payable $ 140,000Prepaid Insurance 60,000 Salaries Payable 20,000Accounts Receivable 100,000 Mortgage Payable 160,000Inventory 140,000 Total Liabilities $320,000Land held for Investment 150,000Land 180,000Buildings $200,000 Common Stock $240,000Less Accumulated Retained Earnings 500,000Depreciation (40,000) 160,000 Total Stockholders’ Equity $740,000Trademarks 140,000 Total Liabilities andTotal Assets $1,060,000 Stockholders’ Equity $1,060,000a. $270,000.b. $590,000.c. $150,000.d. $120,000.
Answer:
a. $270,000
Explanation:
The computation of the total amount of working capital is shown below:
As we know that
working capital = Current asset - current liabilities
where,
Current asset = Cash + prepaid insurance + account receivable + inventory
= $130,000 + $60,000 + $100,000 + $140,000
= $430,000
And, the current liabilities is
= Account payable + salaries payable
= $140,000 + $20,000
= $160,000
So the working capital is
= $430,000 - $160,000
= $270,000
When preparing the financial statements for the month ended January 31, accrued salaries owed to employees for January 30 and 31 were overlooked. The accrued salaries were included in the first salary payment in February. Indicate which items will be erroneously stated, because of failure to correct the initial error, on (A) the income statement for the month of February and (B) the balance sheet as of February 28.a. Income Statement
Answer:
A. Income Statement
Salaries Expense - OVERSTATED
Salaries will be overstated because they would be increased by salaries from January when they should not be as only expenses in February should be apportioned to February.
Net Income - UNDERSTATED
With salaries being higher than they should be, they will reduce the Net income more than they should which will lead to the net income being understated.
B. Balance Sheet
Salaries Payable - No effect
Stockholder's Equity - UNDERSTATED
Net income goes to Equity in the form of Retained earnings. If Net income is understated therefore, so also will Net Income be.
Tamar Co. manufactures a single product in two departments. All direct materials are added at the beginning of the Forming process. Conversion costs are added evenly throughout the process. During May, the Forming department started 23,850 units and transferred 24,700 units of product to the Assembly department. Its 3,500 units of beginning work in process consisted of $20,300 of direct materials and $244,440 of conversion costs. It has 2,650 units (100% complete with respect to direct materials and 80% complete with respect to conversion) in process at month-end. During the month, $636,100 of direct materials costs and $2,276,640 of conversion costs were charged to the Forming department.
Prepare the company’s process cost summary for May using the FIFO method. (Round "Cost per EUP" to 2 decimal places.)
Answer:
Forming department
Process cost summary for May using the FIFO method
units $
INPUTS
Beginning WIP 3,500 $264,740
Started 23,850 $2,912,740
Total 27,350 $3,177,480
OUTPUTS
Transferred to Assembly 24,700 $1,312,805
Ending WIP 2,650 $126,813
Total 27,350 $1,439,618
Explanation:
Equivalent units of production
Materials = 3,500 x 0% + 21,200 x 100% + 2,650 x 100% = 23,850
Conversion Cost = 3,500 x 20% + 21,200 x 100% + 2,650 x 80% = 24,020
Cost per equivalent units of production
Materials = $636,100 ÷ 23,850 = $26.67
Conversion Cost = $636,100 ÷ 24,020 = $26.48
Total = $26.67 + $26.48 = $53,15
Cost allocated to units transferred and to those still in process
Transferred to Assembly = 24,700 x $53,15 = $1,312,805
Ending WIP = 2,650 x $26.67 + 2,120 x $26.48 = $126,813
A company's bond has a coupon rate of 4.00% and has 16 years remaining until maturity. The company's bonds pay interest semi-annually. Due to a cash flow problem, the company will be unable to pay the interest payments for periods 8, 9, and 10. These missed payments will be repaid in one lump sum when the bond matures, without interest. If the Yield to Maturity (YTM) on similar bonds is 11%, what is the intrinsic value of this bond?
Answer:
I used an excel spreadsheet to calculate the bond's value (see attached image). the bond's intrinsic value using a 11% discount rate is $452.08
Explanation:
Kristin Company sells 300 units of its products for $20 each to Logan Inc. for cash. Kristin allows Logan to return any unused product within 30 days and receive a full refund. The cost of each product is $12. To determine the transaction price, Kristin decides that the approach that is most predictive of the amount of consideration to which it will be entitled is the probability-weighted amount. Using the probability-weighted amount, Kristin estimates that (1) 10 products will be returned and (2) the returned products are expected to be resold at a profit. Indicate the amount of (a) net sales, (b) estimated liability for refunds, and (c) cost of goods sold that Kristen should report in its financial statements (assume that none of the products have been returned at the financial statement date).
Answer:
a. Net Sales = (300 units - 10 units return) * $20 each
Net Sales = 290 units * $20 each
Net Sales = $5,800
b. Liability for refunds = (10 units expected to be returned * $20 each)
Liability for refunds = $200
c. Cost of Goods Sold = (300 units - 10 return) * $12 per unit
Cost of Goods Sold = 290 units * $12 per unit
Cost of Goods Sold = $3,480
A manufacturer of industrial grade gas handling equipment wants to have $725,000 in an equipment replacement contingency fund 10 years from now. If the company plans to deposit a uniform amount of money each year beginning now and continuing through year 10 (total of 11 deposits), what must be the size of each deposit
Answer:
$41,354.98
Explanation:
Required future worth = Annual savings x FVIFA(r%, N) x (1 + r)
Required annual savings ($) = [Required future worth / FVIFA(r%, N)] / (1 + r)
= 725,000 / [FVIFA(10%, 10) * 1.1]
= 725,000 / (15.9374 * 1.1)
= 725,000 / 17.53114
= 41354.98318991235
= $41,354.98
Note: Since this is annuity due (deposit made at beginning of year), FV is divided by (1+r).
The following is the ending balances of accounts at December 31, 2021, for the Vosburgh Electronics Corporation.
Account Title Debits Credits
Cash $67,000
Short-term investments 182,000
Accounts receivable 123,000
Long-term investments 35,000
Inventory 215,000
Receivables from employees 40,000
Prepaid expenses (for 2022) 16,000
Land 280,000
Building 1,550,000
Equipment 637,000
Patent (net) 152,000
Franchise (net) 40,000
Notes receivable 250,000
Interest receivable 12,000
Accumulated depreciation—building $620,000
Accumulated depreciation—equipment 210,000
Accounts payable 189,000
Dividends payable (payable on 1/16/2022) 10,000
Interest payable 16,000
Income taxes payable 40,000
Deferred revenue 60,000
Notes payable 300,000
Allowance for uncollectible accounts 8,000
Common stock 2,000,000
Retained earnings 146,000
Totals $3,599,000 $3,599,000
Additional Information
1. The common stock represents 1.4 million shares of no par stock authorized, 670,000 shares issued and outstanding.
2. The receivables from employees are due on June 30, 2022.
3. The notes receivable are due in installments of $67,000, payable on each September 30. Interest is payable annually.
4. Short-term investments consist of securities that the company plans to sell in 2022 and $67,000 in treasury bills purchased on December 15 of the current year that mature on February 15, 2022. Long-term investments consist of securities that the company does not plan to sell in the next year.
5. Deferred revenue represents payments from customer for extended service contracts. Eighty percent of these contracts expire in 2022, the remainder in 2023.
6. Notes payable consists of two notes, one for $117,000 due on January 15, 2023, and another for $217,000 due on June 30, 2024.
Required:
Prepare a classified balance sheet for Vosburgh at December 31, 2021.
Answer:
Vosburgh Electronics Corporation
Classified Balance Sheet
As of December 31, 2021:
Assets
Current Assets:
Cash $67,000
Short-term investments 182,000
Accounts receivable 123,000
Allowance for uncollectible (8,000)
Inventory 215,000
Receivables from employees 40,000
Notes receivable (short-term) 67,000
Interest receivable 12,000
Prepaid expenses (for 2022) 16,000
Total current liabilities $714,000
Long-term Assets:
Land 280,000
Building 1,550,000
Accumulated depreciation (620,000)
Equipment 637,000
Accumulated depreciation (210,000)
Patent (net) 152,000
Franchise (net) 40,000
Notes receivable 183,000
Long-term investments 35,000
Total long-term assets $2,047,000
Total assets $2,761,000
Liabilities + Equity:
Liabilities
Current Liabilities:
Accounts payable $189,000
Dividends payable (payable on 1/16/2022) 10,000
Interest payable 16,000
Income taxes payable 40,000
Deferred revenue 48,000
Total current liabilities $303,000
Long-term liabilities:
Deferred revenue 12,000
Notes payable 300,000
Total Long-term liabilities $312,000
Total Liabilities $615,000
Equity:
Common stock, 1.4 million authorized
670,000 shares issued & outstanding 2,000,000
Retained earnings 146,000
Total Equity $2,146,000
Total liabilities + equity $2,761,000
Explanation:
a) Data and Calculations:
Account Title Debits Credits
Cash $67,000
Short-term investments 182,000
Accounts receivable 123,000
Long-term investments 35,000
Inventory 215,000
Receivables from employees 40,000
Prepaid expenses (for 2022) 16,000
Land 280,000
Building 1,550,000
Equipment 637,000
Patent (net) 152,000
Franchise (net) 40,000
Notes receivable 250,000
Interest receivable 12,000
Accumulated depreciation—building $620,000
Accumulated depreciation—equipment 210,000
Accounts payable 189,000
Dividends payable (payable on 1/16/2022) 10,000
Interest payable 16,000
Income taxes payable 40,000
Deferred revenue 60,000
Notes payable 300,000
Common stock, 1.4 million authorized
670,000 shares issued & outstanding 2,000,000
Retained earnings 146,000
Totals $3,599,000 $3,599,000
Adjustments:
Common stock, 1.4 million shares of no par stock authorized,
670,000 shares issued and outstanding
Receivables from employees are short-term assets
Notes receivable 250,000
Short-term = 67,000
Long-term = 183,000
Deferred Revenue:
Short-term = $48,000 ($60,000 * 80%)
Long-term = $12,000 ($60,000 * 20%)
Qing Yuan and most of her friends are retiring and moving out of the city where they worked all their lives, and living on their savings and Social Security. Which business environment is being affected by this change
Answer:
economic and legal
Explanation:
In the given situation, the economic and legal would be impacted by the change as the economic environment is impacted since the people would not be working that results they would be less contributed to the economy due to this it would develop a more burden in social security benefits that strict the laws so it would be lead to the legal environment
Therefore the above represent the answer
Express the following comparative income statements in common-size percents. (Round your percentage answers to 1 decimal place.)
GOMEZ CORPORATION
Comparative Income Statements
For Years Ended December 31
Current Year Prior Year
Sales$ 720,000 $630,000
Cost of goods sold 565,400 291,000
Gross profit 154,600 339,000
Operating expenses 129,200 268,400
Net income $25,400 $70,600
Answer and Explanation:
The comparative income statements in common size percentage is as follows:
Particulars Current year Present year
Amount % Amount %
Sales $720,000 100 $630,000 100
Less:
Cost of Goods
Sold $565,400 78.53% $291,000 46.19%
Gross Profit $154,600 21.47% $339,000 53.81%
Less:
Operating Expenses $129,200 17.94% $268,400 42.60%
Net Income $25,400 3.53% $70,600 11.21%
Question 6 of 10
Match each business model with the type of business that commonly uses it.
Bricks and clicks
?
Grocery stores
Subscription
?
Magazines
Shopkeeper
Retail stores
?
Answer:
Bricks and Clicks - Retail Stores
Retail stores such as Walmart use a bricks and clicks model to ensure they sell as much as possible. Bricks and clicks refers to having both an online and an offline (physical location) presence where customers can come and buy in person if they want.
Grocery Stores - Shopkeeper
Grocery Stores are usually bricks and mortar which means that they are a physical location. This physical location is usually small and in need of being managed by a shopkeeper.
Subscription - Magazines
Magazines have found over the years that it is effective to offer their services as a subscription based one. That way they can be sure of a steady inflow of cash and people can be sure that they will receive magazines periodically.
A company can purchase component Hfrom 3 potential suppliers. Supplier A charges a fee of $5.50 per component. Supplier B charges $1500 per order plus $2.00 per component ordered. Supplier C charges $4.00 per component,andrequires the buyer to pay for at least 280components (even if the order size is less than 280).
Required:
a. What is the full range of order sizes where each supplier is optimal?
b. The company decided to buy 300 units of component H from supplier A. How much money could the company have saved if it purchased the 300 units from supplier C instead of supplier A?
c. Next week supplier B will be running a 10% off special. If the company needs to purchase 600 units of component H during the special, which supplier should be chosen?
Answer:
a. The full range of the order sizes where each supplier is optimal is:
Supplier A, from 1 to 280 units
Supplier B, from 1,000 units upwards
Supplier C, from 280 to 1,000
b. The company decided to buy 300 units of component H from supplier A. How much money could the company have saved if it purchased the 300 units from supplier C instead of supplier A?
Savings from purchasing from C instead of from A = $450
c. To purchase 600 units during B's 10% off special:
Supplier C should be chosen. It enjoys the minimal cost-advantage.
Explanation:
a) Data and Calculations:
b) Cost of purchasing 300 units from A = $1,650 ($5.50 * 300)
Cost of purchasing 300 units from C = $1,200 ($4.00 * 300)
Savings from purchasing from C = $450 ($1,650 - $1,200)
c) 10% off special by B. This reduces its price from $2 to $1.80 plus the $1,500 per order
Cost of purchasing 600 units from B during the special discount offer =
$1,500 + ($1.80 * 600) = $2,580
Cost of purchasing 600 units from A during B's special discount offer =
$5.50 * 600 = $3,300
Cost of purchasing 600 units from C during B's special discount offer =
$4 * 600 = $2,400
Range of order sizes:
Supplier A, from 1 to 280 units: Above 280 units, Supplier C will be preferred in terms of total cost.
Supplier B, from 1,000 units upwards: This will reduce the unit cost to $3.50 or below.
Supplier C, from 280 to 1,000: Below 280 units, Supplier A performs better than C.
A newly formed firm must decide on a plant location. There are two alternatives under consideration: locate near the major raw materials or locate near the major customers. Locating near the raw materials will result in lower fixed and variable costs compared to locating near the market, but the owners believe there would be a loss in sales volume because customers tend to favor local suppliers. Revenue per unit will be $179 in either case.
Omaha Kansas City
Annual fixed costs ($ millions) $ 1.0 $ 1.1
Variable cost per unit $ 29 $ 44
Expected annual demand (units) 9,850 10,450
Using the above information, determine which location would produce the greater profit.
Answer:
Kansas city
Explanation:
$-477500
$-310,750
The 2020 accounting records of Skysong, Inc. reveal these transactions and events.
Payment of interest $10,800 Collection of accounts receivable $189,200
Cash sales 50,900 Payment of salaries and wages 56,900
Receipt of dividend revenue 19,000 Depreciation expense 16,100
Payment of income taxes 15,700 Proceeds from sale of vehicles 12,100
Net income 38,000 Purchase of equipment for cash 21,900
Payment of accounts payable Loss on sale of vehicles 3,100
For merchandise 115,600 Payment of dividends 14,700
Payment for land 73,700 Payment of operating expenses 27,600
Required:
Prepare the cash flows from operating activities section using the direct method.
Answer:
jggggyhhhyhhhhhhhhggggğytfgvb
Brad Carlton operates Carlton Collectibles, a rare-coin shop in Washington, D.C., that ships coins to collectors in all 50 states. Carlton also provides appraisal services upon request. During the last several years, the appraisal work has been done either in the D.C. shop or at the homes of private collectors in Maryland and Virginia. Determine the jurisdictions in which Carlton Collectibles has sales and use tax nexus.
Answer: He would have sales based on his appraisal and would use tax collection based on he has commercial domicile there
Explanation:
Carlton would have sales based on the appraisal his work receives in Virginia and Maryland. Appraisals go a long way to promote sales in business especially comes from clients who tend to give feedback based on the product they have used. He would use tax collection in the district of Columbia due to he has a commercial domicile in that area.
11) Which of the following sections of the statement of cash flows includes activities that increase and decrease long-term liabilities and stockholders' equity? A) the investing activities section B) the financing activities section C) the operating activities section D) the non-cash investing and financing section
Answer:
A) the investing activities section
Explanation:
A financial statement is a written report that quantitatively describes a firm's financial health. Under the financial statements is a cash-flow statement, which is used to record the cash inflow and cash equivalents leaving a business firm.
Cash flow statement, also known as the statement of cash flows, contains financial information about operating, financial and investing activities.
1. Operating cash flow: all cash generated from the business activities of an organization.
2. Financing cash flow: all payments made by an organization and profits from issuance of debts and equity.
3. Investing cash flow: costs associated with purchasing of capital assets and investments of cash resources in other businesses.
Generally, investing activities comprises of purchasing physical assets, investing in securities and the sale of assets or securities associated with the company.
Hence, the investing activities section of the statement of cash flows includes activities that increase and decrease long-term liabilities and stockholders' equity in the business they have invested their money in.
One item is omitted in each of the following summaries of balance sheet and income statement data for the following four different corporations. This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below.
Carbon Krypton Fluorine RadiumBeginning of the year:Assets $333,000 $250,000 $100,000 $ Liabilities 118,000 130,000 76,000 120,000 End of the year:Assets 495,000 350,000 90,000 248,000 Liabilities 160,000 110,000 80,000 136,000 During the year:Additional issuance of capital stock 50,000 10,000 40,000 Dividends 7,500 16,000 60,000 Revenue 90,000 115,000 112,000 Expenses 39,000 64,000 122,500 128,000
Answer:
Carbon Krypton Fluorine Radium
Beginning of the year:
Assets $333,000 $250,000 $100,000 $268,000
Liabilities 118,000 130,000 76,000 120,000
Equity at the beginning $215,000 $120,000 $24,000 $148,000
End of the year:Assets 495,000 350,000 90,000 248,000
Liabilities 160,000 110,000 80,000 136,000
Equity at the end of the year $335,000 $240,000 $10,000 $112,000
During the year:
Additional capital stock 76,500 50,000 10,000 40,000
Dividends 7,500 16,000 16,500 60,000
Revenue 90,000 150,000 115,000 112,000
Expenses 39,000 64,000 122,500 128,000
Net income $51,000 $86,000 ($7,500) ($16,000)
Explanation:
a) Data and Calculations:
Carbon Krypton Fluorine Radium
Beginning of the year:
Assets $333,000 $250,000 $100,000 $268,000
Liabilities 118,000 130,000 76,000 120,000
Equity at the beginning $215,000 $120,000 $24,000 $148,000
End of the year:Assets 495,000 350,000 90,000 248,000
Liabilities 160,000 110,000 80,000 136,000
Equity at the end of the year $335,000 $240,000 $10,000 $112,000
During the year:
Additional capital stock 76,500 50,000 10,000 40,000
Dividends 7,500 16,000 16,500 60,000
Revenue 90,000 150,000 115,000 112,000
Expenses 39,000 64,000 122,500 128,000
Net income $51,000 $86,000 ($7,500) ($16,000)
Formulas for finding the missing items:
1. Equity at the end = Equity at the beginning + Additional capital + Net Income - Dividends
2. Net Income = Revenue - Expenses
3. Equity = Assets - Liabilities
On January 1, 2017, Waterway Co. enters into a contract to sell a customer a wiring base and shelving unit that sits on the base in exchange for $3,300. The contract requires delivery of the base first but states that payment for the base will not be made until the shelving unit is delivered. Waterway identifies two performance obligations and allocates $1,320 of the transaction price to the wiring base and the remainder to the shelving unit. The cost of the wiring base is $670; the shelves have a cost of $300.
Required:
a. Prepare the journal entry on January 1, 2017, for Waterway
b. Prepare the journal entry on February 5, 2017, for Waterway when the wiring base is delivered to the customer.
c. Prepare the journal entry on February 25, 2017, for Waterway when the shelving unit is delivered to the customer and Waterway receives full payment.
Answer and Explanation:
The journal entries are as follows;
a. On Jan 1
No journal entry is required
b. On Feb 5
Contra asset Dr $1,320
To Sales revenue $1,320
(being sales revenue is recorded)
Cost of goods sold Dr $670
To Inventory $670
(being cost of goods sold is recorded)
c. On Feb 25
Cash $3,300
Contra asset Dr $1,320
To Sales revenue $1,980
(being sales revenue is recorded)
Cost of goods sold Dr $300
To Inventory $300
(being cost of goods sold is recorded)
The following information was taken from the records of Waterway Inc. for the year 2020: Income tax applicable to income from continuing operations $216,920; income tax applicable to loss on discontinued operations $29,580, and unrealized holding gain on available-for-sale securities (net of tax) $17,400.
Gain on sale of equipment $110,200
Cash dividends declared $174,000
Loss on discontinued operations 87,000
Retained earnings January 1, 2020 2,640,000
Administrative expenses 278,400
Cost of goods sold 986,000
Rent revenue 46,400
Selling expenses 348,000
Loss on write-down of inventory 69,600
Sales Revenue 2,204,000
Shares outstanding during 2020 were 100,000.
Required:
Prepare a single-step income statement.
Answer:
Waterway Inc.
Single-step income statement
Particular Amount
Sales Revenue $2,204,000
Add: Rent Revenue $46,400
Total Revenue $2,250,400
Less: Expense
Cost of goods sold $986,000
Selling Expense $348,000
Administrative Expenses $278,400
Total Expenses $1,612,400
Income from operations $638,000
Other revenues and gains
Add: Gain on sale of equipment $110,200
Other expenses and losses
Less: Loss on write-down of inventory $69,600
Income from continuing operations $678,600
before income taxes
Less: Income taxes $216,920
Income from continuing operations $461,680
Discontinued operations:
Loss on discontinued operations $87,000
Income tax at loss on discontinued $29,580 $116,580
operation
Net Income $345,100
Per share of common stock:
Income from continuing operations (income from continuing operations /share outstanding = ($461,680/ 100000) = $4.62
Loss on discontinued operations, net of tax ($116,580 /100000) = $1.17
Net Income ($345,100/100,000) = $3.45
Smith Brothers, a furniture manufacturer based in North Carolina, has tie-ups with raw material suppliers and shipping companies who provide Smith Brothers a uniform pricing option across the United States. Despite the cost of production and distribution being the same across the United States, Smith Brothers charges more for its products on the West Coast than in other parts of the United States. Which of the following acts prohibits this practice?
a. Sherman Antitrust Act
b. Wheeler-Lea Amendment
c. Credit Card Accountability, Responsibility, and Disclosure Act
d.Telephone Consumer Protection Act
e. Robinson-Patman Act
Answer:
e. Robinson-Patman Act
Explanation:
Robinson-Patman Act is a federal law that aims to combat price discrimination by businesses. Companies are not allowed to supply goods at different prices in different locations.
The Act mostly applies to interstate trade and cooperatives are usually exempted.
In the given scenario Smith Brothers charges more for its products on the West Coast than in other parts of the United States. This is despite the fact that they get uniform cost of production across the country.
This is a violation of the Robinson-Patman Act
You have just been offered a promotion that your friend and coworker, Crystal, has been hoping for. Crystal knows that you had a scheduled meeting with your boss today and sends you an e-mail asking how your meeting went. You know Crystal will be upset when she hears the news of your promotion; however, she is a good friend, and you need to be honest and tell her in your response e-mail.
Indirect
Direct
Answer:
Indirect
Explanation:
Since in the question it is mentioned tat you just promoted also at the same time you know that Crystal would be upset at the time when she heared the promotion news but she is the good friend and need to be honest so here the indirect strategy should be used rather using the direct strategy
Therefore the first option is correct
Guay Corp., a start-up company, provided services that were acceptable to its customers and billed those customers for $400,000 in 2015. However, Guay collected only $280,000 cash in 2015, and the remaining $120,000 of 2015 revenues were collected in 2016. Guay employees earned $200,000 in 2015 wages that were not paid until the first week of 2016. How much net income does Guay report for 2015?
Answer:
$200,000
Explanation:
Here, in the solution the tax effects are ignored as tax rate is not provided.
Since accrual basis is the acceptable basis, we have:
All the revenues and expenses are to be recognised in the period it belongs to, and not when the actual cash payment is received or made.
Total revenue earned in 2015 = $400,000
Total expense (Wages of employees) for 2015 = $200,000
Therefore, net income for 2015 = $400,000 - $200,000 = $200,000
Note: It is of no relevance that when actual cash was realised from debtors and when actual payment was made to employees.
A retail store is doing a $50 gift card giveaway by selecting 1 customer from a pool of registered customers. The pool of registered customers has males and females of all ages with 52% of the pool being female and 18% of the pool being over the age of 65. The probability of the winner being female or over age 65 (the union of female and over age 65) is 70%.
a. True
b. False
Answer:
False
Explanation:
Given
[tex]P(Female) = 52\%[/tex]
[tex]P(Age>65) = 18\%[/tex]
Required
Determine [tex]P(Female\ or\ Age>65)[/tex]
The events of being a female and over the age of 65 are non-mutually exclusive events.
We know this because the question says the pool is from all ages.
So, the required probability is calculated using:
[tex]P(A\ or\ B) = P(A) + P(B) - P(A\ and\ B)[/tex]
In this case, it is:
[tex]P(Female\ or\ Age>65) = P(Female) + P(Age>65) - P(Female\ and\ Age>65)[/tex]
This gives:
[tex]P(Female\ or\ Age>65) = 52\% + 18\% - P(Female\ and\ Age>65)[/tex]
[tex]P(Female\ or\ Age>65) = 70\% - P(Female\ and\ Age>65)[/tex]
Because the pool is from all ages,
[tex]P(Female\ and\ Age>65) > 0\%[/tex]
So:
[tex]P(Female\ and\ Age>65) < 70\%[/tex]
The solution to this question is b. False
Which of the following would be considered the output?
Explanation:
Umm what do you mean.....the question isn't there but I am glad to help you