Answer:
$160,000
Explanation:
Calculation to determine The amount that Jesse should report as an income tax refund receivable in 2019
Using this formula
2019 income tax refund receivable=Taxable and pretax financial income * Tax rate
Let plug in the formula
2019 income tax refund receivable =($800,000 × 20%)
2019 income tax refund receivable= $160,000
Therefore The amount that Jesse should report as an income tax refund receivable in 2019 is $160,000
Patterson and Clay Companies both use cost-plus pricing formulas and arrived at a selling price of $1,000 for the same product. Patterson uses absorption manufacturing cost as the basis for computing its dollar markup whereas Clay uses total cost. Which of the following choices correctly denotes the company that would have (1) the higher cost basis for deriving its dollar markup and (2) the higher markup percentage?
Cost Basis Patterson Patterson Clay Clay More information is needed to judge Markup Percentage Patterson Clay Patterson Clay More information is needed to judge
A. Choice A
B. Choice B
C. Choice C
D. Choice D
E. Choice E
Answer:
Patterson and Clay Companies
1. Higher cost basis for marking up is:
= Clay Company
2. Higher markup percentage is:
= Patterson Company
Explanation:
a) Data and Analysis:
Costing formulas:
Patterson:
Absorption manufacturing cost
Markup = Higher markup rate
Selling price $1,000
Clay:
Total cost = Higher cost basis for marking up
Markup
Selling price $1,000
b) Total cost is higher than total manufacturing costs. It includes more than the total manufacturing costs. Absorption manufacturing costs only include the variable manufacturing costs and fixed manufacturing overhead costs. Total costs include all the absorption costs and other selling, administrative, and distribution costs.
According to the most favored nation clause (Article I of GATT), which of the following is true?
A. Tariffs on products imported from countries belonging to the WTO must be lower than tariffs on the same products imported from countries that are not members of the WTO.
B. A country can lower tariffs on imports from countries with most favored nation trading status without changing tariffs on imports from other members of the WTO.
C. If a country gives a trade advantage to one partner, then this advantage must be extended to all its trading partners belonging to the WTO.
D. If a country imposes higher tariffs on one trading partner, then those high tariffs must be imposed on all its trading partners belonging to the WTO.
Answer:
C. If a country gives a trade advantage to one partner, then this advantage must be extended to all its trading partners belonging to the WTO.
Explanation:
The correct option is - C. If a country gives a trade advantage to one partner, then this advantage must be extended to all its trading partners belonging to the WTO.
Reason -
Most-favoured-nation (MFN): treating other people equally Under the WTO agreements, countries cannot normally discriminate between their trading partners. Grant someone a special favour (such as a lower customs duty rate for one of their products) and you have to do the same for all other WTO members.
Patterson Development sometimes sells property on an installment basis. In those cases, Patterson reports income in its income statement in the year of the sale but reports installment income by the installment method on the tax return. Installment income in 2021 was $240 million, which Patterson expects to collect equally over the next four years. The tax rate is 25%, but based on an enacted law, is scheduled to become 35% in 2023.
Patterson's pretax accounting income for the 2013 income statement was $530 million of this, $30 million is non-taxable revenue from proceeds of a life insurance policy. There were no differences between accounting income and taxable income other than those described above and no cumlative temporary differences existed at the beggining of the year:
1. Prepare the appropriate journal entry to record patterson's 2013 income taxes.
2. What is Patterson's 2013 net income?
Answer:
1. Debit Income tax expense for $143 million; Credit Deferred tax liability for $78 million; and Credit Income tax payable for $65 million.
2. Patterson's 2021 net income is $387.
Explanation:
Note: There is an error in the question because of date inconsistency. Therefore, 2021 upward is used in the answer to ensure date consistency.
1. Prepare the appropriate journal entry to record patterson's 2021 income taxes.
Note: See the attached excel file for the calculation of income tax payable and deferred tax liability.
The journal entry will look as follows:
Date General journal Debit ($'M) Credit ($'M)
31 Dec 2021 Income tax expense 143
Deferred tax liability 78
Income tax payable 65
(To record income tax payable.)
2. What is Patterson's 2021 net income?
This can be determined as follows:
Particulars ($'Million)
Pre accounting income 530
Income tax expense (143)
Net income 387
Customer: An entity that describes a customer. An instance occurs for unique customers only using name, date of birth, and login name as customer_id primary key.
Online: An entity that describes a customer purchasing activity online. An instance occurs when the customer completes the transaction. Customers can purchase more than once.
Visits: An entity that describes a customer purchase in a physical store. An instance occurs if a customer makes or purchase or checks-in using an app. Customers can visit more than once per day.
Satisfaction: An entity that represents data from a recent customer satisfaction survey. An instance occurs when a customer takes the survey. A customer is tracked by login name and can only take the survey one time.
Use the information to match the following relationships. Answers can be reused more than once.
1. The relationship between Customer and Online.
2. The relationship between Customer and Satisfaction.
3. The relationship between Online and Visits.
4. The relationship between Visits and Satisfaction
A. prototype
B. one-to-one
C. Zero-sum
D. one-to-many
E. TOO many F. many-to-many.
Answer:
1. The relationship between customer and Online - One to one
2. The relationship between customer and Satisfaction - One to many
3. The relationship between online and visits - Many to many
4. The relationship between Visits and satisfaction - Prototype
Explanation:
The relation ship with customer is often one to one. The customers are required to fill the satisfaction surveys which enable the business to understand their value in the eyes of its customers and try to improve their level of service to their customers. The customer satisfaction is important for any business as the satisfied customer may bring more customers.
Creighton Bicycles and Repair conducted a survey and discovered that among customers who had tried both bike shops, its successful cross-town competition was preferred about 75% of the time. The most frequently cited reason was customer service. This information would be most helpful to introduce to employees during which stage of Lewin's change model
Answer:
Creighton Bicycles and Repair
This information would be most helpful to introduce to employees during Unfreezing stage of Lewin's change model.
Explanation:
The unfreezing stage is the best time to introduce information that challenges the status quo because it will help to prepare Creighton Bicycles and Repair employees to accept that change is inevitable. Creighton Bicycles and Repair should not be satisfied with 75% when it can attain 100% preference for its cross-town competition and other measurable indices. The unfreezing stage convinces organization people that things must change. This information cannot be introduced during the change stage or the refreezing stage.
According to the video, an interactive website needs to be able to do what things? Check all that apply. invite people to provide information remove unwanted viewers send information, products, and services automatically play videos process payments send viewers to other websites
Answer:
A,C,E
Explanation:
Answer:
A,C,E
Explanation:
f-1. Assume that no intra-entity inventory or land sales occurred between Placid Lake and Scenic. Instead, on January 1, 2020, Scenic sold equipment (that originally cost $170,000 but had a $84,000 book value on that date) to Placid Lake for $118,000. At the time of sale, the equipment had a remaining useful life of five years. What worksheet entries are made for a December 31, 2021, consolidation of these two companies to eliminate the impact of the intra-entity transfer
Answer:
Journal 1
Debit : Other Income $34,000
Credit : Equipment $34,000
Journal 2
Debit : Accumulated depreciation $6,800
Credit : depreciation $6,800
Explanation:
Step 1 : Eliminate the Income resulting from sale and the additional value of equipment sitting in the buyer books
Income = Selling Price - Carrying Amount
where,
Carrying Amount = Cost - Accumulated depreciation
= $84,000
therefore,
Income = $118,000 - $84,000 = $34,000
Journal;
Debit : Other Income $34,000
Credit : Equipment $34,000
Step 2 : Eliminate the unrealized profit as a result of additional asset value
unrealized profit = income ÷ remaining useful life
= $34,000 ÷ 5
= $6,800
Journal;
Debit : Accumulated depreciation $6,800
Credit : depreciation $6,800
Trainees are put through a two-month school. The fixed cost of running one session of this school is $150,000. Any number of sessions can be run during the year but must be scheduled so that the airline always has enough flight attendants. The cost of having excess attendants is simply the salary that they receive, which is $15,000 per month. How many sessions of the school
Answer:
The airline training school can run maximum of 10 sessions.
Explanation:
There can be 10 sessions which can be held at the training school. The airline school needs to have enough attendants so that they do not run a session in spare capacity. If a session is run with few attendants then it will cost $15,000 per session which is an additional cost burden for the airline training school.
The SML helps determine the risk-aversion level among investors. The higher the level of risk aversion, the ____________ the slope of the SML. Which of the following statements best describes the shape of the SML if investors were not at all risk averse?
a. The SML would have a positive slope, but the slope would be flatter than it would be if investors were risk.
b. The SML would be a horizontal line.
c. The SML would have a positive slope, but the slope would be steeper than it would be if investors were risk averse.
d. The SML would have a negative slope.
Answer:
a. The SML would have a positive slope, but the slope would be flatter than it would be if investors were at risk.
Explanation:
The SML would have a positive slope, but the slope would be flatter than it would be if investors were risked The SML would be a horizontal line O The SML would have a positive slope, but the slope would be steeper than it would be if investors were risk-averse O The SML would have a negative slope.
Question 13 of 20
Todd's manager has asked him to write a report on ways to increase safety in
the warehouse. Todd used the Internet to research statistics and
recommendations for improving safety in the workplace. He feels like he
pulled together a really strong document and that his manager will be
pleased. However, when he is called into his manager's office, his manager is
concerned and tells him that he has been unethical in his work. What did
Todd do?
A. He likely used the Internet for research, and violated company
confidentiality rules.
B. He likely did not cite his research, and committed plagiarism.
C. He likely told his co-workers he was writing a report, and violated
co-worker's privacy.
D. He likely completed the report on time, and likely violated
company honesty policy
Answer:
he answer is : He likely did not cite his research, and committed plagiarism. Todd's manager has asked him to write a report on ways to increase safety in the warehouse. Todd used the Internet to research statistics and recommendations for improving safety in the workplace. He feels like he pulled together a really strong document and that his manager will be pleased. However, when he is called into his manager's office, his manager is concerned and tells him that he has been unethical in his work. He likely did not cite his research, and committed plagiarism. It is the practice of taking someone else's work or ideas and passing them off as one's own.
Explanation:
On January 2, Dixie, Inc., pays a salvage company $1,000 to haul away a machine costing $28,000 with accumulated depreciation of $28,000. Complete the necessary journal entry by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
No Date General Journal Debit Credit
1 Jan. 2 Gain on disposal of machinery 1,000
Accumulated depreciation 28,000
Answer:
Dr Accumulated depreciation-Machinery 28,000
Dr Loss on disposal 1000
Cr Cash 1000
Cr Machinery 28,000
Explanation:
Based on the information given the appropriate journal entry to record the transaction on On January 2 is :
On January 2
Dr Accumulated depreciation-Machinery 28,000
Dr Loss on disposal 1000
Cr Cash 1000
Cr Machinery 28,000
The carrying value of bonds at maturity always equals: Multiple Choice the amount of discount or premium. the amount of cash originally received in exchange for the bonds plus any unamortized discount or less any premium. the par value of the bond. the amount of cash originally received in exchange for the bonds. the amount in excess of par value.
Answer: the par value of the bond
Explanation:
The carrying value of bonds at maturity will always be equal to the par value of the bond. The carrying value of a bond is simply refered to as the bond's face value or par value plus the premiums taht are unamortized.
We should note that during the time of maturity of the bond, there'll have been an ammortization of the discounts or premiums, while the bond's par value will be left.
The carrying value of bonds at maturity always equals to the amount of cash originally received in exchange for the bonds plus any unamortized discount or less any premium. Thus, option (b) is correct.
At maturity, bonds' carrying values will always be the same as their par values. The face value or par value of a bond plus any unamortized premiums are simply referred to as the bond's carrying value.
To put it another way, it is the total of a bond's face value, any unamortized premiums, and any unamortized discounts, if any. The par value, interest rate, and remaining maturity period of the bond must all be known before calculating the carrying value using the effective interest rate technique.
Therefore, option (b) is correct.
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Wallace Company provides the following data for next year: MonthBudgeted Sales January$ 120,000 February 108,000 March 132,000 April 144,000 The gross profit rate is 35 % of sales. Inventory at the end of December is $ 21,600 and target ending inventory level are 20 % of next month's sales, stated at cost. What is the amount of purchases budget for January
Answer:
$70440
Explanation:
Given data :
Month Budgeted sales
January $120,000
February $108,000
March $132,000
April $144,000
Gross profit rate = 35% of sales
Inventory at end of December = $21600
Target ending inventory level = 20% of next month sales
Determine the amount of purchases budget for January
First step : calculate
Cost of goods for January = Budgeted sales - Gross profit
= $120,000 - $42,000 = $78000
Next : determine ending inventory in January
= 20% * ( Budgeted sales in Feb * 65% )
= 20% * ($108000 * 65%) = $14040
Determine budgeted purchase using the Relation below
Cost of goods sold = Beginning inventory + Budgeted purchases - Ending inventory
78,000 = 21600 + Budgeted purchases - 14040
therefore
Budgeted purchases for January = ( 78,000 + 14040 - 21600 )
= $70440
What is price discrimination and how do movie theaters and restaurants practice price discrimination?
Which of the following is considered important in a company's attempt to strengthen partner relationships? Group of answer choices The partnership's objectives should move beyond tactical issues and toward a more strategic path The partnership should have a shared vision and objectives The partnership should have measurable objectives The vision and objectives should be accepted and formally agreed upon by both parties All of the above are considered important in strengthening partner relationships
Answer:
All of the above are considered important in strengthening partner relationships
Explanation:
Partner relationship exists when two or more people come together to undertake a business venture. Profits and losses are between all partners.
Maintaining a good partner relationship ensures that the business performs and meets its goals.
A strategic path for objectives of the partners means the business does not only plan but executes its plans.
Shared vision and objectives ensures the partners work in harmony to achieve set targets.
The obejecives should be measureable, this sets realistic milestones.
Also shared vision and objectives should be formally agreed to by all parties.
A manufacturer has an estimated practical capacity of 90,000 machine hours, and each unit requires two machine hours. The following data apply to a recent accounting period: Actual variable overhead$ 240,000 Actual fixed overhead$ 442,000 Actual machine hours worked 88,000 Actual finished units produced 42,000 Budgeted variable overhead at 90,000 machine hours$ 200,000 Budgeted fixed overhead$ 450,000 Of the following factors, the manufacturer's production volume variance is most likely to have been caused by: A. A wage hike granted to a production supervisor. B. A newly imposed initiative to reduce finished goods inventory levels. C. Acceptance of an unexpected sales order. D. Temporary employment of workers with lower skill levels than originally anticipated.
Answer:
Of the following factors, the manufacturer's production volume variance is most likely to have been caused by:
D. Temporary employment of workers with lower skill levels than originally anticipated.
Explanation:
a) Data and Calculations:
Estimated practical capacity = 90,000 machine hours
Machine hours per unit = 2
Estimated production units based on capacity = 45,000 (90,000/2)
Budgeted Actual
Variable overhead = $200,000 $240,000
Actual fixed overhead = $450,000 $442,000
Machine hours 90,000 88,000
Units produced 45,000 42,000
Estimated units to be produced based on standard machine hour
= 44,000 units (88,000/2)
Variance between standard units to be produced and actual = 2,000 (44,000 - 42,000) Unfavorable
What factor might an Irrational decision maker consider when making economic decisions?*
A emotions
B perceptions
C sunk costs
D any of the above
You have your choice of two investment accounts. Investment A is a 6-year annuity that features end-of-month $1,980 payments and has an interest rate of 7 percent compounded monthly. Investment B is an annually compounded lump-sum investment with an interest rate of 9 percent, also good for 6 years.
How much money would you need to invest in B today for it to be worth as much as Investment A 6 years from now? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Answer:
$112,166
Explanation:
the future value of Investment A:
payment = $1,980
n = 6 x 12 = 72
i = 9% / 12 = 0.75%
FVIFA = [(1 + i)ⁿ- 1 ] / i = [(1 + 0.0075)⁷² - 1 ] / 0.0075 = 95.007
future value = $1,980 x 95.007 = $188,114
now we need to determine the PV of investment B:
PV = $188,114 / (1 + 9%)⁶ = $112,166
Answer: $105,264.24
Explanation:
Step 1) Calculate Future Value of Investment A
Rate: .07/12 = .58%
Payment: $1,980
Term: 72 (6 years * 12 months)
Future Value: ?
In excel -> FV(.58,72,-1980,0)
Future Value = $176,538.67
Step 2) Calculate Present Value of Investment B using Investment A Future Value
Rate: .09
Payment: $0
Term: 6
Future Value: $176,538.67 (from step 1)
PV(.09,6,0,-176538.67)
Present Value = $105,264.24
Thats your answer!! ^^^^^
You can also use the formula or calculator, but I've found excel is the easiest/fastest.
Cheers!
A researcher was interested in the relationship between the number of texts sent in a day and the number of e-mails sent in a day by employees at a certain company. Using 15 data values, a 90 percent confidence interval for the slope of a regression model was found to be (2.31, 3.47). The researcher claims that the interval would have been narrower with a different sample size if all other things remained the same. Which of the following sample sizes would make the researcher's claim NOT true?
A. 14
B. 16
C. 20
D. 30
E. 100
Answer:
A. 14
Explanation:
the researcher claims that the width of the interval would have been smaller if the sample had been different, and in this case different refers to larger. The original sample included only 15 people, so in order to increase the data sample, you must include more than 15 people. That is why 14 doesn't make sense.
Manrow Growers, Inc., owns equipment for sowing and harvesting its organic fruit, vegetables, and tree nuts that are sold to local restaurants and grocery stores. At the beginning of 2019, an asset account for the company showed the following balances:
Equipment $350,000
Accumulated depreciation through 2018 165,000
During 2019, the following expenditures were incurred for the equipment:
Major overhaul of the equipment on January 1, 2019, that improved efficiency $42,000
Routine maintenance and repairs on the equipment 5,000
The equipment is being depreciated on a straight-line basis over an estimated life of eight years with a $20,000 estimated residual value. The annual accounting period ends on December 31.
Required:
Record the adjusting entry for depreciation on the equipment during 2018.
Answer: See explanation
Explanation:
The adjusting entry for depreciation on the equipment during 2018 will be calculated as:
Depreciation = (Equipment cost - Estimated residual value) / Estimated life
= ($350000 - $20000) / 8
= $41250
Debit: Depreciation = $41250
Credit: Accumulated depreciation = $41250
(To record depreciation for the year)
Graham Corp. has 1,000 cartons of oranges that were harvested at a cost of $30,400. The oranges can be sold as is for $36,400. The oranges can be processed further into orange juice at an additional cost of $13,000 and be sold at a price of $53,000. The net benefit (additional income) from processing the oranges into orange juice instead of selling as is would be:rev: 12_08_2020_QC_CS-243270Multiple Choice$(3,600).$16,600.$3,600.$40,000.$(16,600).
Answer:
c. $3,600
Explanation:
The total cost of orange juice = $30,400 + $13,000
The total cost of orange juice = $43,400
So, the profit on the orange juice = $53,000 - $43,400 = $9,600
Profit when oranges are sold without juice = $36,400 - $30,400
Profit when oranges are sold without juice = $6,000
So, extra income = $$9,600 - $6,000 = $3,600
Thus, the net benefit (additional income) from processing the oranges into orange juice instead of selling as is would be is $3,600
rdan Corporation expects to incur indirect overhead costs of $172,550 per month and direct manufacturing costs of $18 per unit. The expected production activity for the first four months of the year are as follows. January February March April Estimated production in units 5,300 7,300 4,800 6,400 Required Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. Allocate overhead costs to each month using the overhead rate computed in Requirement a. Calculate the total cost per unit for each month using the overhead allocated in Requirement b.
Answer:
Results are below.
Explanation:
Giving the following information:
Total estimated overhead costs= (172,550*4)= $690,200
Total estimated units= 23,800
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 690,200 / 23,800
Predetermined manufacturing overhead rate= $29 per unit
Now, we can allocate overhead to each month:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
January= 29*5,300= $153,700
February= 7,300*29= $211,700
March= 29*4,800= $139,200
April= 29*6,400= $185,600
Finally, the unitary total cost:
Unitary cost= 18 + 29= $47
Which tasks are common to all Education and Training career pathways? assessing students on learning and approving budgets communicating with schools and families and enforcing rules that govern behavior teaching students and collaborating with teachers on instructional content developing instructional content for teachers and assessing student learning through exams
The tasks associated with Education and Training career pathways is communicating with schools and families.
What is a career pathways?Career pathways serves as a profession path that individuals choose to follow in the rest of his life.
Therefore, second option is correct because going along Education and Training career pathways ,enforcing rules that govern behavior teaching is needed
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1 points Time Remaining 1 hour 14 minutes 35 seconds01:14:35 eBookPrintReferencesCheck my workCheck My Work button is now enabledItem 13 Time Remaining 1 hour 14 minutes 35 seconds01:14:35 Alice is single and self-employed in 2020. Her net business profit on her Schedule C for the year is $196,000. What is her self-employment tax liability and additional Medicare tax liability for 2020
Answer:
Self employment tax liability = $22,323.97Additional Medicare tax liability = $0Explanation:
According to the IRS, the amount subject to self-employment tax is 92.35% of net income from self-employment for the year.
Alice's taxable income is:
= 92.35% * 196,000
= $181,006
Self employment tax-liability:
Social security tax for 2020 is 12.4% for the first $137,700 of income.
= 12.4% * 137,700
= $17,074.80
Medicare tax:
= 2.9% on taxable income
= 2.9% * 181,006
= $5,249.17
Self-employment tax is:
= 17,074.80 + 5,249.17
= $22,323.97
Additional Medicare tax applies on only amounts above $200,000 so it is $0 in this case.
The balance in the Work in Process Inventory at any point in time equals Multiple Choice the costs for jobs finished during the period but not yet sold. the manufacturing cost of jobs ordered but not yet started into production. the sum of the manufacturing costs for all jobs in process but not yet completed. the manufacturing costs of all jobs started during the period, completed or not. the sum of the materials, labor and overhead costs paid during the period.
Answer:
the sum of the costs of all jobs started but not yet completed
Explanation:
Work in process inventory can be regarded as those materials that are partially completed within a production cycle. The materials are direct labour costs as well as factory overheads, raw materials along with cost needed to develop the material till it becomes final product. It should be noted that The balance in the Work in Process Inventory at any point in time equals the sum of the costs of all jobs started but not yet completed
Kirkland Company combines its operating expenses for budget purposes in a selling and administrative expense budget. For the first 6 months of 2020, the following data are available. 1. Sales: 20,800 units quarter 1; 22,100 units quarter 2. 2. Variable costs per dollar of sales: sales commissions 5%, delivery expense 2%, and advertising 3%. 3. Fixed costs per quarter: sales salaries $10,900, office salaries $6,160, depreciation $4,490, insurance $2,080, utilities $880, and repairs expense $670. 4. Unit selling price: $24. Prepare a selling and administrative expense budget by quarters for the first 6 months of 2020
Answer:
Selling and administrative expense budget for 6 months = $144,300
Explanation:
Note: See the attached excel for the selling and administrative expense budget.
From the attached excel file, we have:
Quarter 1 total cost = $70,720
Quarter 2 total cost = $73,580
Selling and administrative expense budget for 6 months = Six months total cost = Quarter 1 total cost + Quarter 2 total cost = $70,720 + $73,580 = $144,300
Consider the following statements when answering this question I. Increases in the demand for a good, which is produced by a competitive industry, will raise the short-run market price. II. Increases in the demand for a good, which is produced by a competitive industry, will raise the long-run market price. I is true, and II is false. I and II are true. I is false, and II is true. I and II are false.
Answer:
I and II are true
Explanation:
I. Increases in the demand for a good, which is produced by a competitive industry, will raise the short-run market price
In the short run of the competitive industry when the market demand for goods rises then the price of these goods will also increase. This is because the price equals marginal revenue. Therefore, when price rises then marginal revenue will increase and as a result, the marginal cost curve moves up and firms produce more quantity of goods. This statement is therefore true.
II. Increases in the demand for a good, which is produced by a competitive industry, will raise the long-run market price
The effect of the increase in goods demand is the same in the long run of the competitive industry as it is in the short run. Therefore, a rise in demand would raise the price of the goods above ATC (Average Total Cost). Hence, the above statement is also true.
Scoring: Your score will be based on the number of correct matches. There is no penalty for incorrect or missing matches.
Match each of the following transactions to the journal in which it would be entered.
Clear All
Revenue journal Cash receipts journal Purchases journal Cash payments journal General journal Recognized depreciation on the building Journalized the adjusting entry for supplies used during the period Closed the revenue account at the end of the period Received cash from the bank in exchange for a note payable Withdrew cash for personal use (by owner)
Answer:
Matching transactions to the journal in which they would be entered:
Transactions Journal Type
1. Recognized depreciation on the building General Journal
2. Journalized the adjusting entry for supplies
used during the period General Journal
3. Closed the revenue account at the end
of the period General Journal
4. Received cash from the bank in exchange
for a note payable Cash Receipts Journal
5. Withdrew cash for personal use (by owner) Cash Payments Journal
Explanation:
Revenue journal records revenue transactions.
Cash receipts journal records all cash receipts.
Purchases journal records all purchases on account.
Cash payments journal records all cash payments.
General journal is used for all transactions, especially those that cannot be recorded in any of the other specialized journals.
A small factory is considering replacing its existing coining press with a newer, more efficient one. The existing press was purchased three years ago at a cost of $200000, and it is being depreciated according to a 7-year MACRS depreciation schedule. The factoryâs CFO estimates that the existing press has 6 years of useful life remaining. The purchase price for the new press is $280000. The installation of the new press would cost an additional $20000, and this installation cost would be added to the depreciable base. The new press (if purchased) would be depreciated using the 7-year MACRS depreciation schedule although, as noted below, it would be retired/sold after 6 years. Interest expenses associated with the purchase of the new press are estimated to be roughly $4000 per year for the next 6 years.
The appeal of the new press is that it is estimated to produce a pre-tax operating cost savings of $81000 per year for the next 6 years. Also, if the new press is purchased, the old press can be sold for $30000 today. The CFO believes that the new press would be sold for $45000 at the end of its 6-year useful life. Assume that NWC would not be affected. The company has an average tax rate of 29% and a marginal tax rate of 34%. The cost of capital (i.e., the discount rate) for this project is 8.5%.
Required:
Develop the incremental cash flows for this replacement decision and use them to calculate NPV and IRR. Next, make a conclusion about whether or not the existing coining press should be replaced at this time.
Answer:
1. Incremental Cash Flows:
Cash Flows Total PV of annual
Cash Flows
After-tax operating savings $57,510 $261,877
Sale proceeds from old press 30,000 30,000
Sale proceeds from new press 45,000 27,583
Total incremental cash inflows $132,510 $319,460
Cost of new press $280,000 $280,000
Installation cost of new press 20,000 20,000
Interest expense (associated) 4,000 18,214
Total incremental cash outflows $340,000 $318,214
2. NPV $1,246 ($319,460 -$318,214)
IRR = the cost of capital that will cause the NPV to be zero. Since it is $1,246, to find the rate, that makes it zero, we do the following calculations:
$1,246/$318,214 * 100 = 0.4%
Cost of capital = 8.5%
3. IRR = 8.5 - 0.4 = 8.1%
4. Conclusion: The existing press should be replaced at this time.
Explanation:
a) Data and Calculations:
Cost of old press = $200,000
Estimated useful life remaining = 6 years
Cost of new press = $280,000
Installation cost = $20,000
Total cost of new press $300,000
Interest expenses per year for the new press = $4,000
Cost Savings from new press:
Pre-tax operating cost savings = $81,000 per year
After-tax savings = $57,510 ($81,000 * (1 - 29%))
Sales proceeds from old press = $30,000 today
Sale proceeds from new press = $45,000 (at the end of its 6-year life)
Average tax rate = 29%
Marginal tax rate = 34%
Cost of capital = 8.5%
he Dimitrios Company records the following transactions during September 2018: Cash sales to customers totaling $5,800. Sales to customers on credit cards totaling $18,800. The average credit card fee is 3.0%. The company collects all cash due from the credit card companies. A $2,000 sale on account to a long-time customer with terms of 2/10, n/30. The sale is made on September 5. The customer pays the invoice on September 14. A customer returns product they had purchased last month for $500. Dimitrios accepts the return and gives the customer a cash refund. Calculate the following amounts: Service charge expense for credit card sales Sales discount (contra-revenue) for sales on account Sales returns (contra-revenue) Gross sales revenue Net sales revenue Net cash collected from sales
Answer:
The Dimitrios Company
Service charge expense for credit card sales = $564 ($18,800 * 3%)
Sales discount (contra-revenue) for sales on account = $40 ($2,000 * 2%)
Sales returns (contra-revenue) - $500
Gross sales revenue:
Cash $5,800
Cards $18,800
Accounts receivable $2,000
Total = $26,600
Net sales revenue = $26,100 ($26,600 - $500)
Net cash collected from sales:
Cash Sales $5,800
Card Sales $18,800
Accounts Receivable $2,000
Less: Card Fees $564
Cash Discounts $40
Cash Refund $500
Net cash = $ 25,496
Explanation:
a) Data and Analysis:
Sept. 2018:
Cash $5,800 Sales Revenue $5,800
Credit Cards Receivable $18,800 Sales Revenue $18,800
Credit Card Fee Expense $ 564 Cash $564
Cash $18,800 Credit Cards Receivable $18,800
Accounts Receivable $2,000 Sales Revenue $2,000, terms of 2/10, n/30.
Cash $1,960 Cash Discounts $40 Accounts Receivable $2,000
Sales Returns $500 Cash $500