Answer:
$380,550
Explanation:
Cash flows from operating activities:
Net income $248,000
Adjustments to net income:
Depreciation expense $95,500
Gain on sale of equipment ($5,900)
Decrease in accounts rec. $39,100
Increase in accounts pay. $17,550
Decrease in wages payable ($13,700) $132,550
Net cash flow from operating activities $380,550
Leading up to the signing of a contract with an integration clause, a buyer sent an e-mail to the seller of a beautiful, new $45,000 boat asking, "You provide financing, right?" The seller responded, "Yes, of course." The contract, which the parties signed yesterday, said nothing about financing. Right after signing, the seller said, "OK, let's get you set up with financing!" He then ran the buyer's credit, which was not good. The buyer was not approved for financing through the seller's only source. The buyer believes that he, therefore, is not liable for the cost of the boat. Is the buyer correct?
Answer: No, because of the integration clause
Explanation:
Based on the information given, the buyer isn't correct as a result of the integration clause.
The integration clause, is a clause in a written contract that stipulates that a particular contract is complete and that the parties involved agreed to the contract and it's final.
This contract supersedes every other informal understandings and all other oral agreements relating as well. Therefore, the buyer is liable for the cost of the boat.
The first step in the decision-making process involves
a. defining the problem
b. setting a goal
O c. identifying the choices
d. evaluating alternatives
The first step in the decision-making process involves option A. defining the problem. The correct answer is option A. defining the problem.
What do you do first when making decision?When making a decision, it is essential to clearly understand and define the problem or the issue at hand. This step involves identifying the specific challenge or opportunity that requires a decision.
By defining the problem, you can gain a better understanding of what needs to be addressed and begin formulating potential solutions. Once the problem is defined, you can proceed to the subsequent steps of the decision-making process, such as setting goals, identifying choices, and evaluating alternatives.
Therefore, the correct answer is option A. defining the problem as identified above.
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What method can help to avoid typos when writing a function that includes a range?
Answer:
clicking and dragging to select the range
Coronado Industries sells one product and uses a perpetual inventory system. The beginning inventory consisted of 79 units that cost $19 per unit. During the current month, the company purchased 483 units at $19 each. Sales during the month totaled 365 units for $44 each. What is the cost of goods sold using the LIFO method?
Answer:
the cost of goods sold under LIFO method is $6,935
Explanation:
The computation of the cost of goods sold under LIFO method is shown below:
= Sales during the month × cost per unit
= 365 units × $19
= $6,935
Hence, the cost of goods sold under LIFO method is $6,935
We simply applied the above formula
Robin is granted 1,500 shares of restricted stock from her employer when the stock is trading at a fair market value of $25 per share. She is anticipating significant appreciation and wishes to minimize her future tax burden. As a result, she makes a Section 83(b) election. Assuming she is in the 35% marginal income tax bracket, how much income tax that will be due on this transaction in the year of election
Answer: $13125
Explanation:
Firstly, we should note that in section 83(B), tax is being paid based on the stock's fair market value. Therefore, the income tax that will be due on this transaction in the year of election will be:
= Number of shares × Price × Tax rate
= 1500 × $25 × 35%
= 1500 × $25 × 0.35
= $13125
Blair Madison Co. issues $2.0 million of new stock and pays $291,000 in cash dividends during the year. In addition, the company took advantage of falling interest rates to borrow $1.60 million in a new bond issue and paid off existing bonds with a face value of $2.50 million. The company bought 510 of another company's $1,100 bonds at a $110,000 premium. The net cash flow provided by financing activities is:
Answer:
$809,000
Explanation:
Bliss madison offers $2,000,000 new stocks
He pays $291,000 in cash dividend
The company took advantage of the falling interest rate to borrow $1,600,000
They paid off bonds with an existing face value of $2,500,000
Therefore the net cash flow can be calculated as follows
= 2,000,000-291,000+1,600,000-2,500,000
= 809,000
Hence the net cash flow is $809,000
Assume that a business has $50000 of current assets and $40000 of current liabilities. What is the company’s current ratio?
Answer:
The company's current ratio is 1.25.
Explanation:
The current ratio is calculated by dividing the current assets by the current liabilities:
current assets=$50000
current liabilities=$40000
current ratio=$50000/$40000
current ratio=1.25
According to this, the answer is that the company's current ratio is 1.25.
PLEASE , chart this out !
Answer:
Purchases
Date Qty Unit Cost Total Cost
11 12 $18 $216
21 9 $15 $135
Cost of Sales
Date Qty Unit Cost Total Cost
14
21 $16 $336
5 $18 $90
25
7 $18 $126
4 $15 $60
Total $612
Inventory
Qty Unit Cost Total Cost
5 $15 $75
Total $75
Explanation:
FIFO method assumes that the units to arrive first, will be sold first. Also note that the perpetual Inventory method is used. This means the cost of sales and inventory value is calculated after every transaction.
So with FIFO , Cost of Sales will be calculated on earlier prices (old prices) whilst Inventory will be valued at recent (later prices) prices.
Rodgers Company gathered the following reconciling information in preparing its May bank reconciliation. Calculate the adjusted cash balance per books on May 31. Cash balance per books, 5/31 $4,022 Deposits in transit 248 Notes receivable and interest collected by bank 746 Bank charge for check printing 28 Outstanding checks 1,754 NSF check 164 a.$4,576 b.$994 c.$3,098 d.$2,516
Answer: a.$4,576
Explanation:
Sometimes the cash balance according to the books is not the same as the cash in the bank account and this is due to some transactions not being recorded by either the bank or the firm.
Adjusted cash balance per books = Unadjusted cash balance + Note receivable and interest collected by bank - Bank charge for check printing - NSF Check
= 4,022 + 746 - 28 - 164
= $4,576
Zeibart Company purchases equipment for $225,000 on July 1, 2016, with an estimated useful life of 10 years and expected salvage value of $25,000. Straight-line depreciation is used. On July 1, 2020, economic factors cause the market value of the equipment to decline to $90,000. On this date, Zeibart examines the equipment for impairment and estimates $125,000 in future cash inflows related to use of this equipment.
Required:
a. Is the equipment impaired at July 1, 2020?
b. If the equipment is impaired on July I, 2020, compute the impairment loss and prepare a journal entry to record the loss.
Answer:
a. Yes, the equipment is impaired at July 1, 2020.
b. Impairment loss is $20,000. And the journal entries are as follows:
Debit Impairment loss for $20,000
Debit Accumulated depreciation for $80,000
Credit Equipment for $100,000
Explanation:
a. Is the equipment impaired at July 1, 2020?
This can be determined as follows:
Annual depreciation = (Cost - Salvage value) / Estimated useful life = ($225,000 - $25,000) / 10 = $20,000
Accumulated depreciation till July 1, 2020 = Annual depreciation * Number of years from July 1, 2016 to July 1, 2000 = $20,000 * 4 = $80,000
Net book value at July 1, 2020 = Cost - Accumulated depreciation till July 1, 2020 = $225,000 - $80,000 = $145,000
Equipment recoverable amount = Estimated future cash inflows related to use of the equipment = $125,000
Since the net book value of $145,000 is greater than the recoverable amount of the equipment of $125,000, this implies that the equipment is impaired at July 1, 2020.
b. If the equipment is impaired on July I, 2020, compute the impairment loss and prepare a journal entry to record the loss.
Accumulated depreciation till July 1, 2020 = $80,000
Estimated future cash inflows related to use of the equipment = $125,000
Fair market value = $90,000
Recoverable amount = Higher of estimated future cash inflows related to use of the equipment or Fair market value = $125,000
Net book value at July 1, 2020 = $145,000
Impairment loss = Net book value at July 1, 2020 - Recoverable amount = $145,000 - $125,000 = $20,000
The journal entries will then look as follows:
Date Details Debit ($) Credit ($)
01 Jul 2020 Impairment loss 20,000
Accumulated depreciation 80,000
Equipment 100,000
(To record impairment loss.)
The Category Profile that involves evaluating the major forces and trends that are impacting an industry: including pricing, competition, regulatory forces, technology, and demand trends is called the:
Answer: External Industry Analysis
Explanation:
External Industry Analysis simply refers to the examination of the industry environment of a particular company such as its dynamics, competitive position, history etc.
The external industry analysis on a macro scale has to do with examining the factors like technological, political, demographic, and social analysis. External industry analysis is vital as it shows the threats and the opportunities that exist in a particular industry and can also be used to determine growth of an organization.
The term that explains Category Profile and its relationship with evaluation of major force as well as trends that has impact on a particular industry such as competition, technology as well as price is called External analysis
External analysis can be regarded as Category Profile which helps in the evaluation of factors such as forces and trends and how they influence a particular industry.These forces could be;
technology pricingcompetitionregulatory forcesTherefore, External analysis examine the environment of an industry and determine the opportunities as well as threats in a particular industry.
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The country of Lessidinia has a tax system identical to that of the United States. Suppose someone in Lessidinia bought a parcel of land for 20,000 foci (the local currency) in 1960 when the price index equaled 100. In 2002, the person sold the land for 100,000 foci, and the price index equaled 600. The tax rate on nominal gains was 20 percent. Compute the taxes on the nominal gain and the change in the real value of the land in terms of 2002 prices to find the after-tax real rate of capital gain.
Answer: -30%
Explanation:
The Nominal gain is:
= 100,000 - 20,000
= 80,000 foci
Tax on nominal gain:
= 20% * 80,000
= 16,000 foci
After tax nominal value of land:
= 100,000 - 16,000
= 84,000 foci
The real value given the price index is:
= 84,000 / 600 * 100
= 14,000 foci
After tax real rate of cap. gain:
= (14,000 - 20,000) / 20,000
= -30%
Example suppose in a country there were 1,00,000,000 total populations ,8,000,000 people were unemployed and 72,000,000 were held jobs . calculate,I.The national employment rate? II.National unemployment rate ?
Explanation:
National employment rate=72%
72,000,000/1,00,000,000
National unemployment rate=0.08% =8%
8,000,000/1,00,000,000
As per the given data-
The national employment rate is 72%
The National unemployment rate will be 8%
What is unemployment?
Situation of unemployment refers to the situation when there is a lack of job opportunities and more qualified individuals or candidates seeking job opportunities with their willingness.
The national employment rate helps individuals to know the ratio of employment in the country whereas the national unemployment rate helps to determine the rate of unemployed in the country.
Calculation-
I. The national employment rate
= (employed people / total populations)*100
= (72000,000/ 1,00,000,000)*100
= 72%
II. National unemployment rate
= (unemployed persons/number of persons in the labor force)*100
=(8,000,000 / 1,00,000,000)*100
=8%
Therefore, the rate of employment is 72% whereas the unemployment rate is 8%.
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.
Fischer Company has outstanding 8,000 shares of $100 par value, 5% preferred stock, and 50,000 shares of $1 par value common stock. The company has $328,000 of retained earnings. At year-end, the company declares and pays the regular $5 per share cash dividend on preferred stock and a $1.80 per share cash dividend on common stock. What is the total dividends paid by Fischer Company
Answer:
The appropriate solution is "$130,000".
Explanation:
The given values are:
No. of common shares outstanding
= 50,000
Dividend per share
= $1.80
No. of preferred shares outstanding
= 8,000
Dividend per share
= $5
Now,
The total dividend on common shares will be:
= [tex]No. \ of \ common \ shared \ outstanding\times Dividend \ per \ share[/tex]
On substituting the values, we get
= [tex]50,000\times 1.80[/tex]
= [tex]90,000[/tex] ($)
The total dividend on preferred stock will be:
= [tex]No. \ of \ preferred \ shares \ outstanding\times Divided \ per \ share[/tex]
On substituting the values, we get
= [tex]8,000\times 5[/tex]
= [tex]40,000[/tex] ($)
Hence,
The total dividend paid by company will be:
= [tex]Total \ dividend \ on \ common \ shares +Total \ dividend \ on \ preferred \ stock[/tex]
= [tex]90,000+40,000[/tex]
= [tex]130,000[/tex] ($)
Thus the above is the correct answer.
As a manager seeks to develop her leadership skills, she should be aware that:______.
A. There is one best leadership style to which all managers should aspire
B. Leadership is first and foremost about establishing a deep knowledge of their industry
C. Ideally, managers will have both management and leadership skills
D. Leadership is primarily about personal efficiency
Answer:
B. Leadership is first and foremost about establishing a deep knowledge of their industry.
Explanation:
Leadership is the capacity of a person to influence the actions of others to deliver on set goals and objectives. A leader is someone who gets things done through others.
A manager who seeks to develop her leadership skills should be aware that leadership is first and foremost about establishing a deep knowledge of their industry. As an aspiring leader, a manager must have full knowledge of the industry he or she is working. This is important because the manager would be able to effectively direct, control, motivate and influence people he is leading due to the vast experience gotten from the industry he is operating.
Answer:
Ideally, managers will have both management and leadership skills
Explanation:
just took the test
The Mega-Bank is considering either a bankwide overhead rate or department overhead rates to allocate $135,000 of indirect costs. The bankwide rate could be based on either direct labor hours (DLH) or the number of loans processed. The departmental rates would be based on direct labor hours for Consumer Loans and a dual rate based on direct labor hours and the number of loans processed for Commercial Loans. The following information was gathered for the upcoming period:
Department DLH Loans Processed Direct Costs
Consumer 16,000 650 $350,000
Commercial 7,000 400 $250,000
Banc Corp. Trust estimates that it costs $500 to analyze and close a commercial loan. This amount has been included in the $410,000 of indirect costs. How much of the $410,000 indirect costs should be allocated to the Commercial Department?
Answer:
The Mega-Bank
The amount allocated to the Commercial Department is:
= $324,810.
Explanation:
a) Data and Calculations:
Indirect costs = $410,000
Department DLH Loans Processed Direct Costs
Consumer 16,000 650 $350,000
Commercial 7,000 400 $250,000
Total 23,000 1,050 $600,000
Allocation Bases:
Bankwide rates:
DLH = $410,000/23,000 = $17.83
Loans processed = $410,000/1,050 = $390.48
Commercial Department Allocated Costs:
Cost to process loans = $500 * 400 = $200,000
Cost based on DLH = $17.83 * 7,000 = 124,810
Total costs = $324,810
The following events took place when Managers A, B, and C were preparing budgets for the upcoming period:
I. Manager A increased property tax expenditures by 2% when she was informed of a recent rate hike by local authorities.
II. Manager B reduced sales revenues by 4% when informed of recent aggressive actions by a new competitor.
III. Manager C, who supervises employees with widely varying skill levels, used the highest wage rate in the department when preparing the labor budget.
Assuming that the percentage amounts given are reasonable, which of the preceding cases is (are) an example of building slack in budgets?
a. Il only.
b. I only.
c. II and III.
d. Ill only
e. I and II.
Answer:
Assuming that the percentage amounts given are reasonable, an example of building slack in budgets is:
d. Ill only
Explanation:
By using the highest wage rate in the department, Manager C deliberately overestimated her departmental expenses. However, her action is dictated by the need to ensure that there are no budget shortages for wages. By this slack, the actual performance of the department will be better than the budgeted performance because the department will likely spend less than its allotted costs.
The cases that represent an example of the building slacks in budgets should be option III.
Usage of highest wage rate:
Here we use the high wage rate with respect to the department. Also, the manager c should be overestimated the department expenses. The action should be dictated via the need for assurance that there should no shortages with respect to the wages. Also, the actual performance should be more than the budgeted performance since the department should lower than it
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Miramar Industries manufactures two products, A and B. The manufacturing operation involves three overhead activities - production setup, material handling, and general factory activities. Miramar uses activity-based costing to allocate overhead to products. An activity analysis of the overhead revealed the following estimated costs and activity bases for these activities:
Activity Cost Activity Base
Production Setup $250,000 Number of setups
Material Handling $150,000 Number of parts
General Overhead $80,000 Number of direct labor hours
Each productâs total activity in each of the three areas are as follows:
Product A Product B
Number of setups 100 300
Number of parts 40,000 20,000
Number of direct labor hours 9,000 12,000
What is the activity rate for General Overhead?
A. $4.00 per direct labor hour
B. $3.81 per direct labor hour
C. $6.71 per direct labor hour
D. $4.20 per direct labor hour
Answer:
General overhead= $3.81 per direct labor hour
Explanation:
Given the following information:
General Overhead $80,000 Number of direct labor hours
Number of direct labor hours 9,000 12,000= 21,000
To calculate the activity rate, we need to use the following formula:
Activity rate= estimated costs / total amount of allocation rate
General Overhead= 80,000 / 21,000
General overhead= $3.81 per direct labor hour
Strongheart Enterprises anticipated selling 27,000 units of a major product and paying sales commissions of $6 per unit. Actual sales and sales commissions totaled 27,500 units and $171,400, respectively. If the company used a flexible budget for performance evaluations, Strongheart would report a cost variance of: Multiple Choice $6,400F. $9,400F. None of the answers is correct. $9,400U. $6,400U.
Answer:
Flexible budget cost variance= $6,400 unfavorable
Explanation:
To calculate the flexible budget cost variance, we need to use the following formula:
Flexible budget cost variance= (standard costs*actual quantity) - actual costs
Flexible budget cost variance= (6*27,500) - 171,400
Flexible budget cost variance= 165,000 - 171,400
Flexible budget cost variance= $6,400 unfavorable
During August, Boxer Company sells $354,000 in merchandise that has a one year warranty. Experience shows that warranty expenses average about 5% of the selling price. The warranty liability account has a credit balance of $11,600 before adjustment. Customers returned merchandise for warranty repairs during the month that used $8200 in parts for repairs. The entry to record the estimated warranty expense for the month is: Question 8 options: Debit Estimated Warranty Liability $8200; credit Warranty Expense $8200. Debit Estimated Warranty Liability $17,700; credit Warranty Expense $17,700. Debit Warranty Expense $6100; credit Estimated Warranty Liability $6100. Debit Warranty Expense $14,300; credit Estimated Warranty Liability $14,300. Debit Warranty Expense $17,700; credit Estimated Warranty Liability $17,700.
Answer:
Debit Warranty Expense $14,300
Credit Estimated Warranty Liability $14,300
Explanation:
With regards to the above, we are matching the warrant cost , which can be anytime in the future.
Expected warranty liability
= 5% of sales
= 5% × $354,000
= $17,700
Less;
Current balance
= $11,600 - $8,200
= $3,400
Adjustment
= $14,300
Here, the returned goods had a cost of $8,200 which is warranted against warrant liability, hence the balance reduces to $3,400
7. You are considering the possibility of replacing an existing machine that has a book value of $500,000, a remaining depreciable life of five years, and a salvage value of $300,000. The replacement machine will cost $2 million and have a ten-year life. Assuming that you use straight-line depreciation and that neither machine will have any salvage value at the end of the next ten years, how much would you need to save each year to make the change (the tax rate is 40 percent)
Answer:
$221344.48
Explanation:
Book value of existing machine = $500,000
remaining depreciable life = 5 years
salvage value = $300,000
cost of replacement machine = $2 million
depreciable life = 10 years
Tax rate = 40 %
Difference in the cost of new machine and salvage value of existing machine
= 2,000,000 - 300,000 = $1,700,000
Calculate the depreciation tax benefit of new machine = ( 500,000 / 5 ) * 0.4 = $40,000
next calculate the present value of this tax benefit
= $40000,PVAF(1.10,5years)^5 ------- ( 1 )
where the Annuity of 5 years at 10% = 1/(1.10)5 = 3.7907)
Insert value into equation 1 (to calculate the present value of the tax benefit
= 40000*3.79078676 = $1,51,631.47 ( present value of tax benefit )
Determine the Annual depreciation tax advantage of the new machine
= (2,000,000/10)*0.40 = $80,000
Determine present value of this annuity
= $80,000,PVAF(1.10,10years)^10 ------ ( 2 )
where the Annuity of 5 years at 10% = 1/(1.10)^10 ) = 6.144567
Insert value into equation2 ( to calculate the present value of this annuity )
= 80000 * 6.144567 = $491565.36
Therefore the Net cost of the new machine will be
= $491565.36 - $151631.47 - $1,700,000 = $1,360,066
Annual savings on the new machine in 10 years
= 1,360,066 / 6.144567 = $221344.48
Hyper Color Company manufactures widgets. The following data is related to sales and production of the widgets for last year. Selling price per unit Variable manufacturing costs per unit Variable selling and administrative expenses per unit Fixed manufacturing overhead (in total) Fixed selling and administrative expenses (in total) Units produced during the year Units sold during year Using absorption costing, what is operating income for last year? (Round any intermediary calculations to the nearest whole dollar.)
Answer: $24,000
Explanation:
Operating income under absorption costing:
= Sales - Cost of goods sold - Selling and admin expenses
Cost of goods sold = Variable production cost + Fixed production cost
= (61 * 1,000 units sold) + (32,000 / 1,500 units produced * 1,000 units sold)
= $82,333
Selling and admin expenses:
= Variable + Fixed
= (6 * 1,000) + 8,000
= $14,000
Operating income = (120 * 1,000) - 82,333 - 14,000
= $23,667
= $24,000
Generally, a loan obtained from a bank will be a _____ loan.
A. Taxed
B. Term
C. Variable
D. Collateral-free
Answer:
Term
Explanation:
In late 2020, the Nicklaus Corporation was formed. The corporate charter authorizes the issuance of 6,000,000 shares of common stock carrying a $1 par value, and 2,000,000 shares of $5 par value, noncumulative, nonparticipating preferred stock. On January 2, 2021, 4,000,000 shares of the common stock are issued in exchange for cash at an average price of $10 per share. Also on January 2, all 2,000,000 shares of preferred stock are issued at $20 per share.
Required:
1. Prepare journal entries to record these transactions.
2. Prepare the shareholders' equity section of the Nicklaus balance sheet as of March 31, 2021. (Assume net income for the first quarter 2021 was $1,750,000.)
Part B
During 2021, the Nicklaus Corporation participated in three treasury stock transactions:
On June 30, 2021, the corporation reacquires 250,000 shares for the treasury at a price of $12 per share.
On July 31, 2021, 25,000 treasury shares are reissued at $15 per share.
On September 30, 2021, 25,000 treasury shares are reissued at $10 per share.
Required:
1. Prepare journal entries to record these transactions.
2. Prepare the Nicklaus Corporation shareholders' equity section as it would appear in a balance sheet prepared at September 30, 2021. (Assume net income for the second and third quarter was $3,250,000.)
Part C
On October 1, 2021, Nicklaus Corporation receives permission to replace its $1 par value common stock (6,000,000 shares authorized, 4,000,000 shares issued, and 3,800,000 shares outstanding) with a new common stock issue having a $0.50 par value. Since the new par value is one-half the amount of the old, this represents a 2-for-1 stock split. That is, the shareholders will receive two shares of the $0.50 par stock in exchange for each share of the $1 par stock they own. The $1 par stock will be collected and destroyed by the issuing corporation.
On November 1, 2021, the Nicklaus Corporation declares a $0.18 per share cash dividend on common stock and a $0.35 per share cash dividend on preferred stock. Payment is scheduled for December 1, 2021, to shareholders of record on November 15, 2021.
On December 2, 2021, the Nicklaus Corporation declares a 1% stock dividend payable on December 28, 2021, to shareholders of record on December 14. At the date of declaration, the common stock was selling in the open market at $10 per share. The dividend will result in 76,000 (0.01 Ã 7,600,000) additional shares being issued to shareholders.
Required:
1. Prepare journal entries to record the declaration and payment of these stock and cash dividends.
2. Prepare the December 31, 2021, shareholders' equity section of the balance sheet for the Nicklaus Corporation. (Assume net income for the fourth quarter was $2,750,000.)
3. Prepare a statement of shareholders' equity for Nicklaus Corporation for 2021.
Answer:
Nicklaus Corporation
1. Journal Entries:
Debit Cash $40 million
Credit Common Stock $4 million
Credit Additional paid-in capital- Common stock $36 million
To record the issue of 4 million shares at $10 each.
Debit Cash $40 million
Credit Preferred stock $10 million
Credit Additional paid-in capital - preferred $30 million
To record the issue of 2 million share at $20 per share.
2. Shareholders' equity as of March 31, 2021:
Capital
Authorized:
Common stock 6 million, $1 par value
Noncumulative, nonparticipating preferred stock, 2 million, $5 par value
Issued and outstanding:
Common stock 4 million, $1 par value $4 million
Additional paid in capital - common stock 36 million
Preferred stock 2 million, $5 par value 10 million
Additional paid in capital- preferred stock 30 million
Retained Earnings 1.75 million
3. Journal Entries:
June 30, 2021:
Debit Treasury stock $3 million
Credit Cash $3 million
To record the purchase of 250,ooo shares of treasury stock at $12.
July 31, 2021:
Debit Cash $375,000
Credit Treasury stock $375,000
To record the reissue of 25,000 shares of treasury stock at $15 per share.
Sept 30, 2021:
Debit Cash $250,000
Credit Treasury stock $250,000
To record the reissue of 25,000 shares of treasury stock at $10 per share.
2. Shareholders' equity as of September 30, 2021:
Capital
Authorized:
Common stock 6 million, $1 par value
Noncumulative, nonparticipating preferred stock, 2 million, $5 par value
Issued and outstanding:
Common stock 4 million, $1 par value $4 million
Additional paid in capital - common stock 36 million
Preferred stock 2 million, $5 par value 10 million
Additional paid in capital- preferred stock 30 million
Treasury stock - common stock, 200,000 ($2.375 million)
Retained Earnings 5 million
Part C:
1. Journal Entries:
Oct. 1, 2021: Memorandum record to note the change:
Stock-split Common stock, 8 million, $0.50 par value
Nov. 1, 2021:
Debit Cash Dividends:
Common stock = $1,368,000
Preferred stock = $700,000
Credit Cash $2,068,000
To record the payment of dividends.
Dec. 2, 2021:
Debit Stock dividend $38,000
Credit Common Stock $38,000
To record the issue of shares.
Debit Retained Earnings $38,000
Credit Stock dividends $38,000
To record the the declaration.
2. Shareholders' equity as of December 31, 2021:
Capital
Authorized:
Common stock 12 million, $0.50 par value
Noncumulative, nonparticipating preferred stock, 2 million, $5 par value
Issued and outstanding:
Common stock 8.076 million, $0.50 par value $4.038 million
Additional paid in capital - common stock 36 million
Preferred stock 2 million, $5 par value 10 million
Additional paid in capital- preferred stock 30 million
Treasury stock - common stock, 200,000 ($2.375 million)
Retained Earnings 5.644 million
3. Statement of Shareholders' equity:
Common stock 8.076 million, $0.50 par value $4.038 million
Additional paid in capital - common stock 36 million
Preferred stock 2 million, $5 par value 10 million
Additional paid in capital- preferred stock 30 million
Treasury stock - common stock, 200,000 ($2.375 million)
Retained Earnings $5,000,000
Net income 2,750,000
Dividends paid (2,068,000)
Stock dividends ($38,000) 5.644 million
Explanation:
a) Data and Calculations:
Capital
Authorized:
Common stock 6 million, $1 par value
Noncumulative, nonparticipating preferred stock, 2 million, $5 par value
Issued:
Common stock 4 million, $1 par value, issued at $10
Preferred stock 2 million, $5 par value, issued at $20
June 30, 2021 Treasury stock $3 million Cash $3 million
July 31, 2021 Cash $375,000 Treasury stock ($375,000)
Sept 30, 2021 Cash $250,000 Treasury stock ($250,000)
Oct. 1, 2021:
Stock-split Common stock, 8 million, $0.50 par value
Nov. 1, 2021:
Cash Dividends:
Common stock = $1,368,000 ($0.18 * 7,600,000)
Preferred stock = $700,000 ($0.35 * 2,000,000)
Dec. 2, 2021:
Stock dividends:
Additional shares issued = 76,000 (7,600,000 * 1%)
Issued at par $0.50
Stock dividend = $38,000
The following information is available for Pioneer Company:
Sales price per unit is $100. November and December, sales were budgeted at 2,920 and 3,510 units, respectively. Variable costs are 11 percent of sales (6 percent commission, 3 percent advertising, 2 percent shipping). Fixed costs per month are sales salaries, $5,300; office salaries, $2,700; depreciation, $2,900; building rent, $4,000; insurance, $1,500; and utilities, $700..
Required:
Determine Pioneer's budgeted selling and administrative expenses for November and December.
Answer:
15
Explanation:
The following transactions are for Blossom Company.
1. On December 3, Blossom Company sold $521,000 of merchandise to Sunland Co., on account, terms 3/10, n/30. The cost of the merchandise sold was $334,400.
2. On December 8, Sunland Co. was granted an allowance of $30,700 for merchandise purchased on December 3.
3. On December 13, Blossom Company received the balance due from Sunland Co.
A. Prepare the journal entries to record these transactions on the books of Blossom Company. Blossom Company uses a perpetual inventory system.
B. Assume that Blossom Company received the balance due from Sunland Co. on January 2 of the following year instead of December 13. Prepare the journal entry to record the receipt of payment on January 2.
Answer:
A. Dec 3
Dr Account receivable $521,000
Cr Sales revenue $521,000
Dr Cost of goods sold $334,400
Cr Merchandise inventory $334,400
Dec 8
Dr Sales return and allowance $30,700
Cr Account receivable $30,700
Dec 13
Dr Cash $475,591
Dr Sales discount $14,709
Cr Account receivable $490,300
B. Jan 2
Dr Cash $490,300
Cr Account receivable $490,300
Explanation:
A. Preparation of the journal entries to record these transactions on the books of Blossom Company.
Dec 3
Dr Account receivable $521,000
Cr Sales revenue $521,000
(To record sales)
Dr Cost of goods sold $334,400
Cr Merchandise inventory $334,400
(To record cost of goods sold)
Dec 8
Dr Sales return and allowance $30,700
Cr Account receivable $30,700
Dec 13
Dr Cash (490,300*97%) $475,591
Dr Sales discount $14,709
(490,300*3%)
Cr Account receivable ($521,000-$30,700) $490,300
B. Preparation of the journal entry to record the receipt of payment on January 2.
Jan 2
Dr Cash $490,300
Cr Account receivable $490,300
($521,000-$30,700)
(To record the receipt of payment)
if you writte here you are not a helper people of branly
Answer:
sorry just wanted the points
Explanation:
General Importers announced that it will pay a dividend of $3.85 per share one year from today. After that, the company expects a slowdown in its business and will not pay a dividend for the next 5 years. Then, 7 years from today, the company will begin paying an annual dividend of $1.95 forever. The required return is 11.8 percent. What is the price of the stock today
Answer:
The right response is "$11.91".
Explanation:
Dividend
= $3.85 per share
Required return
= 11.8%
Annual dividend
= 1.95
Now,
The price of share at the beginning of year 7 will be:
= [tex]\frac{Annual \ dividend}{Required \ return}[/tex]
On substituting the values, we get
= [tex]\frac{1.95}{11.8 \ percent}[/tex]
= [tex]16.53[/tex] ($)
So,
The price of the stock today will be:
= [tex]Present \ value \ of \ all \ future \ dividend[/tex]
= [tex]3.85\times 0.894+16.53\times 0.512[/tex]
= [tex]3.4419+8.46336[/tex]
= [tex]11.91[/tex] ($)
Suppose that you are considering the development of a residential subdivision. The development will require you to spend $300,000 today to acquire the land. You will also have to spend $750,000 in both years 1 and 2 in order to build the houses. You expect to make $1.5 million in year 3 and $2 million in year 4 from sales of the completed homes. What is the internal rate of return of this project
Answer:
32.52%
Explanation:
Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
Cash flow in year 0 = $-300,000.
Cash flow in year 1 and 2 = $-750,000
Cash flow in year 3 = $1.5 million
Cash flow in year 4 = $2 million
IRR = 32.52%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
A local Chevrolet dealership carries the following types of vehicles:
Inventory Items Quantity Cost per Unit Market (replacement cost) per Unit
Vans 3 $22,000 $20,000
Trucks 6 17,000 16,000
2-door sedans 2 12,000 14,000
4-door sedans 7 16,000 19,000
Sports cars 3 32,000 35,000
SUVs 5 28,000 23,000
Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and trucks.
Required:
a. Compute the total cost of the entire inventory.
b. Determine whether each inventory item would be reported at cost or market. Multiply the quantity of each inventory item by the appropriate cost or market amount and place the total in the "Lower-of-Cost-or-Market" column. Then determine the total for that column.
c. Compare your answers in Requirement 1 and Requirement 2 and then record any necessary adjustment to write down inventory from cost to market value.
d. Discuss the financial statement effects of using lower-of-cost-or-market to report inventory.
Answer:
Explanation:
Since the table doesn't show up correctly, the first dollar value is the Cost per Unit of the vehicle, while the second dollar value is the Market Cost per Vehicle.
a. If we compute the cost using the Cost per Unit then they would be the following.
Vans: 3 * $22,000 = $66,000Trucks: 6 * $17,000 = $102,0002-Door Sedans: 2 * $12,000 = $24,0004-Door Sedans: 7 * $16,000 = $112,000Sports Cars: 3 * $32,000 = $96,000SUV's: 5 * $28,000 = $140,000Total Inventory: $504,000b. The "Lower-of-Cost-or-Market" basically states that whatever of the two prices is lower is ultimately the one that is recorded as the cost. Therefore, under this method the costs would be the following...(Purchase Cost or Market Cost)
Vans: 3 * $20,000 = $60,000 MarketTrucks: 6 * $16,000 = $96,000 Market2-Door Sedans: 2 * $12,000 = $24,000 Purchase Cost4-Door Sedans: 7 * $16,000 = $112,000 Purchase CostSports Cars: 3 * $32,000 = $96,000 Purchase CostSUV's: 5 * $23,000 = $115,000 MarketTotal Inventory: $504,000 Purchase Costc. There were only 3 changes made from from requirement 1 and 2 these were the changes in total cost...
Vans: $60,000 - $66,000 = - $6000Trucks: $96,000 - $102,000 = - $6000SUV's: $115,000 - $140,000 = - $25,000d. This allows companies to report losses at a much more reasonable and consistent way. Thus allowing profits to be more predictable.
a. Total inventory cost: $504,000
b. Total inventory at lower-of-cost-or-market: $503,000
c. Adjustment to write down inventory: -$37,000
d. Using lower-of-cost-or-market to report inventory allows for more realistic and conservative reporting, reflecting the decrease in market value.
a. If we compute the cost using the Cost per Unit then they would be the following.
Vans: 3 * $22,000 = $66,000
Trucks: 6 * $17,000 = $102,000
2-Door Sedans: 2 * $12,000 = $24,000
4-Door Sedans: 7 * $16,000 = $112,000
Sports Cars: 3 * $32,000 = $96,000
SUV's: 5 * $28,000 = $140,000
Total Inventory: $504,000
b. The "Lower-of-Cost-or-Market" basically states that whatever of the two prices is lower is ultimately the one that is recorded as the cost. Therefore, under this method the costs would be the following...(Purchase Cost or Market Cost)
Vans: 3 * $20,000 = $60,000 (reported at market)
Trucks: 6 * $16,000 = $96,000 (reported at market)
2-Door Sedans: 2 * $12,000 = $24,000 (reported at cost)
4-Door Sedans: 7 * $16,000 = $112,000 (reported at cost)
Sports Cars: 3 * $32,000 = $96,000 (reported at cost)
SUVs: 5 * $23,000 = $115,000 (reported at market)
Total for "Lower-of-Cost-or-Market" column: $60,000 + $96,000 + $24,000 + $112,000 + $96,000 + $115,000 = $503,000
c. The necessary adjustment to write down inventory from cost to market value is as follows:
Vans: -$6,000
Trucks: -$6,000
SUVs: -$25,000
d. Using the lower-of-cost-or-market method to report inventory allows companies to recognize and account for potential declines in the market value of their inventory.
By valuing inventory at the lower cost or market value, it ensures a conservative approach and provides a more accurate representation of the company's financial position.
This approach helps in reflecting the true economic value of inventory and potential losses associated with declines in market value.
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