Answer:
1. Dr Receivables $ 83,900
Dr Inventory $70,250
Dr Building (net) $122,000
Dr Equipment (net) $24,100
Dr Customer list $25,200
Dr Capitalized R&D $36,400
Dr Goodwill $41,900
Cr Current liabilities $12,900
Cr Long-term liabilities $54,250
Cr Contingent obligation performance $20,100
Cr Acquisition cost $316,500
2. Dr Combination expense (Legal fees) $12,700
Cr Cash $12,700
Explanation:
1. Preparation of the First Entry to Record the acquisition of Streeter company.
First step is to calculate Goodwill on Acquisition
Acquisition cost $316,500
Add Contingent obligation performance $20,100
Total Acquisition cost $336,600
Less Fair value of Streeter company:
Receivables $ 83,900
Inventory $70,250
Building (net) $122,000
($78,900+$43,100)
Equipment (net) $24,100
Customer list $25,200
Capitalized R&D $36,400
Current liabilities ($12,900 )
Long-term liabilities ($54,250 ) ($294,700)
Goodwill $41,900
($336,600-$294,700)
Now let prepare the First Entry to Record the acquisition of Streeter company.
Dr Receivables $ 83,900
Dr Inventory $70,250
Dr Building (net) $122,000
($78,900+$43,100)
Dr Equipment (net) $24,100
Dr Customer list $25,200
Dr Capitalized R&D $36,400
Dr Goodwill $41,900
Cr Current liabilities $12,900
Cr Long-term liabilities $54,250
Cr Contingent obligation performance $20,100
Cr Acquisition cost $316,500
(To record acquisition of Streeter Company)
2. Preparation of the Second Entry to Record the legal fees related to the combination
Dr Combination expense (Legal fees) $12,700
Cr Cash $12,700
(To record payment of Legal fees)
You are a financial analyst for Loch Motor Company and have been asked to determine the impact of alternative depreciation methods. For your analysis, you have been asked to compare methods based on a machine that cost $246,000. The estimated useful life is 10 years, and the estimated residual value is $62,000. The machine has an estimated useful life in productive output of 230,000 units. Actual output was 35,000 in year 1 and 31,000 in year 2.
Required:
For years 1 and 2 only, prepare separate depreciation schedules assuming:
a. Straight-line method.
b. Units-of-production method.
c. Double-declining-balance method.
Answer:
a. Straight-line method.
depreciable value = $246,000 - $62,000 = $184,000
deprecaition expense per year = $184,000 / 10 = $18,400
year depreciation expense book value
1 $18,400 $227,600
2 $18,400 $209,200
b. Units-of-production method.
depreciable value = $246,000 - $62,000 = $184,000
deprecaition expense per unit = $184,000 / 230,000 = $0.80
year depreciation expense book value
1 $28,000 $218,000
2 $24,800 $193,200
c. Double-declining-balance method.
depreciation expense year 1 = $246,000 x 1/10 x 2 = $49,200
depreciation expense year 2 = $196,800 x 1/10 x 2 = $39,360
year depreciation expense book value
1 $49,200 $196,800
2 $39,360 $157,440
Kier Company issued $700,000 in bonds on January 1, Year 1. The bonds were issued at face value and carried a 4-year term to maturity. The bonds have a 6.50% stated rate of interest and interest is payable in cash on December 31 each year. Based on this information alone, what are the amounts of interest expense and cash flows from operating activities, respectively, that will be reported in the financial statements for the year ending December 31, Year 1
Answer: Interest expense = $45500
Cash outflow = $45500
Explanation:
Based on the information that were given in the question, the amounts of interest expense and cash flows from operating activities, that will be reported in the financial statements for the year ending December 31, Year 1 will be calculated thus:
Interest expense = $700,000 × 6.50%
= $700,000 × 0.065
= $45500
The interest expense of $45500 will be reported on December 31, Year 1 in the income statement and will also be reported in the cash outflow as well. Therefore,
Interest expense = $45500
Cash outflow = $45500
Producer surplus is best defined as _________________. Select the correct answer below: the profit of producers when they make more goods than are demanded the profit of producers when there are too many producers for a certain demand in a market the profit that producers make above the cost of production the intangible profits producers make in addition to the goods they sell
Answer:
the profit that producers make above the cost of production.
Explanation:
Producer surplus is best defined as the profit that producers make above the cost of production.
Basically, it is the total amount of money that a particular producer of goods and services benefits (gains) from selling at the market price.
In Economics, there are primarily two (2) factors which affect the availability and the price at which goods and services are sold or provided, these are demand and supply.
The law of demand states that, the higher the demand for goods and services, the higher the price it would be sold all things being equal. On the other hand, law of supply states that the higher the price of goods and services, the lower the supply.
TB MC Qu. 10-149 (Algo) ABC Corporation makes a product ... ABC Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 7.7 grams $ 2.30 per gram Direct labor 0.5 hours $ 23.00 per hour Variable overhead 0.5 hours $ 7.30 per hour The company produced 5,500 units in January using 39,610 grams of direct material and 2,410 direct labor-hours. During the month, the company purchased 44,700 grams of the direct material at $2.00 per gram. The actual direct labor rate was $22.30 per hour and the actual variable overhead rate was $7.10 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for January is:
Answer:
Direct labor rate variance= $482 favorable
Explanation:
Giving the following information:
Variable overhead 0.5 hours $ 7.30 per hour
Actual direct labor hours= 2,410
The actual variable overhead rate was $7.10 per hour.
To calculate the variable overhead rate variance, we need to use the following formula:
Variable manufacturing overhead rate variance= (standard rate - actual rate)* actual quantity
Variable manufacturing overhead rate variance= (7.3 - 7.1)*2,410
Variable manufacturing overhead rate variance= $482 favorable
Rouse Corporation's December 31, 2012 balance sheet showed the following: 8% preferred stock, $20 par value, cumulative, 20,000 shares authorized 10,000 shares issued $150,000 Common stock, $10 par value, 2,000,000 shares authorized 1,950,000 shares issued, 1,930,000 outstanding 19,000,000 Paid-in capital excess of par --- preferred stock 60,000 Paid-in capital excess of par --- common stock 27,000,000 Retained earnings 7,650,000 Treasury stock (20,000 Shares) 630,000 Rouse's total stockholders' equity was:
Answer:
See bellow
Explanation:
With regards to the above, Rouse total stockholder's equity is computed as;
= Preferred stock + common stock + paid in capital in excess of par (preferred stock and common stock) + retained earnings - Treasury stock
= $150,000 + $1,950,000 + $60,000 + $27,000,000 + $7,650,000 - $630,000
= $53,730,000
Using the attached sheet (or a spreadsheet if you prefer), prepare a classified balance sheet for the ABC, LLC for the year ended December 31, 2020 using the following data.
Accounts Payable 4,000
Accounts Receivable 3,000
Cash 20,000
Common Stock 1,000
Land 25,000
Notes Payable (due in 5 years) 10,000
Paid in Capital in Excess of Par - Common Stock 17,000
Paid in Capital in Excess of Par - Preferred Stock 2,000
Preferred Stock 8,000
Retained Earnings 7,000
Salaries Payable 5,000
Treasury Stock 6,000
Answer:
ABC, LLC
Classified balance sheet as at December 31, 2020
$
ASSETS
Non - Current Assets
Land 25,000
Total Non - Current Assets 25,000
Current Assets
Accounts Receivable 3,000
Cash 20,000
Total Current Assets 23,000
TOTAL ASSETS 48,000
EQUITY AND LIABILITIES
LIABILITIES
Non - Current Liabilities
Notes Payable (due in 5 years) 10,000
Total Non - Current Liabilities 10,000
Current Liabilities
Accounts Payable 4,000
Salaries Payable 5,000
Total Current Liabilities 9,000
TOTAL LIABILITIES 19000
EQUITY
Common Stock 1,000
Preferred Stock 8,000
Treasury Stock 6,000
Retained Earnings 7,000
Paid in Capital in Excess of Par - Common Stock 17,000
Paid in Capital in Excess of Par - Preferred Stock 2,000
TOTAL EQUITY 41,000
TOTAL EQUITY AND LIABILITIES 60,000
Explanation:
A classified balance sheet shows the Assets, Liability and Equity Balances in their respective categories as shown above.
two obstacles you may face in your attempt to achieve your goals
Answer: Perfectionism, Expectations, Distrations, etc.
Explanation:
An act of Procrastinating and viewing of mistakes as failure are obstacles one might face in your attempt to achieve goals.
What is a goals?A goals refers to a predetermined aim that an entity or group plans to to achieve in a set period of time.
However, some obstacles that one might face in an attempt to achieve your goals includes:
Procrastination: This obstacle delays the act of carrying out an action.Viewing mistakes as failure: This makes people to fear making mistake whereas they should stand as stepping stone for success.Read more about goals
brainly.com/question/3658939
Break-even sales and sales to realize operating incomeFor the current year ended March 31, Cosgrove Company expects fixed costs of $465,000, a unit variable cost of $62, and a unit selling price of $92.a. Compute the anticipated break-even sales (units).fill in the blank 1 unitsb. Compute the sales (units) required to realize operating income of $108,000.fill in the blank 2 units
Answer:
Break even point in units=15,500 units
Units to achieve target profit=19,100 units
Explanation:
Break-even point is the level of activity at which a firm must operate such that its total revenue will equal its total costs. At this point, the company makes no profit or loss because the total contribution exactly equals the total fixed costs
Break-even point (in units) is calculated using this formula:
Break even point in units = Total general fixed cost/ (selling price - Variable cost)
Break even point in units= $465,000/(92-62)=15,500 units
Units to achieve target profit = (Total general fixed cost for the period + target profit)/ contribution per unit
Units to achieve target profit of 108,000 = ($465,000+ 108,000)/ (92-62)=19,100 units
Break even point in units=15,500 units
Units to achieve target profit=19,100 units
You are a manager at Baroque Space, a costume design company. Recently, your boss asked you to hire a new seamstress. You are now ready to begin recruiting. You know that if you useexternal recruiting, you will be likely to bring new skills into the company, so you decide to use that approach. Which of the following actions could you take to implement your decision?
a. Design a career path
b. Publish an advertisement on an Internet job site
c. Contact a local college recruiting office
Answer: Design a career path
Explanation:
The action that can be taken to implement the decision is having a career path.
A career path simply refers to the path taken by employees in an organization. This is essential as it'll make the worker have a smooth transition while performing their roles.
g Jesse Co. reports a taxable and pretax financial loss of $800,000 for 2019. Jesse's taxable and pretax financial income and tax rates for the last two years were: 2017 $800,000 20% 2018 800,000 35% The amount that Jesse should report as an income tax refund receivable in 2019, assuming that it uses the carryback provisions and that the tax rate is 40% in 2019, is
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
Q 22.14: The Eccleston Company has the following budgeted sales: January $40,000, February $60,000, and March $50,000. 40% of the sales are for cash and 60% are on credit. For the credit sales, 50% of the amount is collected in the month of sale, and 50% in the next month. The total expected cash receipts during March are
Answer:
Total cash collection March= $53,000
Explanation:
Giving the following information:
Sales:
February $60,000
March $50,000.
Sales in cash= 40%
Sales on account= 60% (50% of the amount is collected in the month of sale, and 50% in the next month)
We need to calculate the cash collection for March:
Cash collection March:
Sales on Cash March= (50,000*0.4)= 20,000
Sales on account March= (50,000*0.6)*0.5= 15,000
Sales on account February= (60,000*0.6)*0.5= 18,000
Total cash collection March= $53,000
A $64,000 machine with a 6-year class life was purchased 2 years ago. The machine will now be sold for $50,000 and replaced with a new machine costing $82,000, with a 10-year class life. The new machine will not increase sales, but will decrease operating costs by $9,000 per year. Simplified straight line depreciation is employed for both machines, and the marginal corporate tax rate is 34 percent. What is the incremental annual cash flow associated with the project
Answer:
$6,779
Explanation:
Calculation to determine the incremental annual cash flow associated with the project
First step is to calculate the depreciation
Depreciation=[($64,000/6 years)-($82,000/10 years)
Depreciation=$10,667-$8,200
Depreciation=$2,467
Now let calculate the Incremental annual cash flow
Incremental annual cash flow ={($9,000-$2,467)
-[($9,000-$2,467)*34%]+$2,467}
Incremental annual cash flow =[($6,533-$2,221)+$2,467]
Incremental annual cash flow =$4,312+$2,467
Incremental annual cash flow=$6,779
Therefore the incremental annual cash flow associated with the project is $6,779
Faux Stamp company contemplating the acceptance of a special order has the following cost behavior, based on production of 10,000 units. The company is currently operating at 70% of its manufacturing capacity. A customer wants to purchase 2,000 units at a special unit price of $25. The normal price per unit is $50. Direct materials are $4 per unit, direct labor is $10 per unit, variable overhead is $8 per unit, and fixed overhead is $60,000 total. Perform an incremental analysis to determine the effect on net income if the special order is accepted, and decide whether management should accept the special order. What is the impact on net income if you accept the order?
Answer:
Management should accept the order because it increases net income by $6,000.
Explanation:
Giving the following information:
Number of units= 2,000
Unit selling price= $25
Direct material= $4
Direct labor= $10
Variable overhead= $8
Because it is a special order and there is unused capacity, we won't take into account the fixed costs.
To calculate the effect on income, we need to use the following formula:
Effect on income= number of units*unitary contribution margin
Effect on income= 2,000*(25 - 4 - 10 - 8)
Effect on income= $6,000 increase
Management should accept the order because it increases net income by $6,000.
Objectives of pep stores
Answer:
The answer is below
Explanation:
PEP is a big store that is located in South Africa and other African countries.
Based on the PEP mission and vision and according to the company's website, the Objectives of PEP stores are:
1. To be the friendliest and most trusted retailer for this market.
2. To offer wanted products and services at the lowest possible prices
3. To meet changing consumer needs.
Last month when Holiday Creations, Inc., sold 41,000 units, total sales were $282,000, total variable expenses were $214,320, and fixed expenses were $36,900. Required: 1. What is the company’s contribution margin (CM) ratio? 2. What is the estimated change in the company’s net operating income if it can increase total sales by $1,700? (Do not round intermediate calculations.)
Answer:
1. Company’s contribution margin (CM) ratio = 24%
2. Estimated change in the company’s net operating income = $408
Explanation:
1. What is the company’s contribution margin (CM) ratio?
Contribution margin (CM) = Total sales - Total variable expenses = $282,000 - $214,320 = $67,680
Contribution margin (CM) ratio = Contribution margin / Total sales = $67,680 / $282,000 = 0.24, or 24%
2. What is the estimated change in the company’s net operating income if it can increase total sales by $1,700? (Do not round intermediate calculations.)
Estimated change in the company’s net operating income = Increase total in sales * Contribution margin (CM) ratio = $1.700 * 24% = $408
Assume that last year, Cliff Consulting, a firm in Berkeley, CA, had the following contribution income statement:
CLIFF CONSULTING
Contribution Income Statement
For the Year Ended September 30
Sales revenue $ 1,200,000
Variable costs
Cost of services $ 480,000
Selling and administrative 60,000 540,000
Contribution margin 660,000
Fixed Costs -selling and administrative 440,000
Before-tax profit 220,000
Income taxes (21%) 46,200
After-tax profit $ 173,800
(a) Determine the annual break-even point in sales revenue.
(b) Determine the annual margin of safety in sales revenue.
(c) What is the break-even point in sales revenue if management makes a decision that increases fixed costs by $80,000?
(d) With the current cost structure, including fixed costs of $440,000, what dollar sales revenue is required to provide an after-tax net income of $250,000?
(e) Prepare an abbreviated contribution income statement to verify that the solution to requirement (d) will provide the desired after-tax income.
Answer:
Cliff Consulting
a) Annual Break-even point in sales revenue is:
= $800,000
b) Annual margin of safety is:
= $400,000
c) If fixed costs increases by $80,000, the break-even point in sales revenue
= $945,455
d) Dollar Sales Revenue required to provide an after-tax net income of $250,000 is:
= $1,375,375
e) Abbreviated Contribution Income Statement
Sales revenue $1,375,375
Variable costs = 618,919
Contribution = $756,456
Fixed costs 440,000
Before tax income 316,456
Income tax (21%) 66,458
After-tax income $249,998
equivalent to $250,000
Explanation:
a) Data and Calculations:
CLIFF CONSULTING
Contribution Income Statement
For the Year Ended September 30
Sales revenue $ 1,200,000
Variable costs
Cost of services $ 480,000
Selling and administrative 60,000 540,000
Contribution margin 660,000
Fixed Costs -selling and administrative 440,000
Before-tax profit 220,000
Income taxes (21%) 46,200
After-tax profit $ 173,800
Break-even point in sales revenue = Fixed costs/Contribution margin ratio
= $440,000/0.55
= $800,000
Annual margin of safety = normal sales revenue minus break-even sales revenue
= $1,200,000 - $800,000
= $400,000
Contribution margin ratio = contribution margin/sales revenue * 100
= $660,000/$1,200,000 * 100 = 55%
If fixed costs increases by $80,000, the break-even point in sales revenue
= ($440,000 + $80,000)/0.55 = $520,000/0.55 = $945,455
To achieve after-tax net income of $250,000, the required dollar sales revenue:
Net income after-tax = $250,000
Tax rate = 21%
Net income before tax = $250,000/1-21%
= $250,000/0.79 = $316,456
Sales dollars to achieve target profit = (Fixed costs + Target Profit/1 - 0.21)/Contribution margin
= ($440,000 + ($250,000/0.79))/0-55
= ($440,000 + $316,456)/0.55
= $756,456/0.55
= $1,375,375
Abbreviated Contribution Income Statement
Sales revenue $1,375,375
Variable costs = 618,919
Contribution = $756,456
Fixed costs 440,000
Before tax income 316,456
Income tax (21%) 66,458
After-tax income $249,998
After-tax income is equivalent to $250,000
Frida makes bread every day and due to demand she is thinking of increasing her bread production. In order to make this decision, she would calculate her marginal costs of bread production (increased number of employees, equipment, etc.) and her marginal benefits (number of loaves sold, price paid, new customers, etc.) and continue to produce where Select the correct answer below:
a. MB
b. MB>MC or until they are equal.
c. total benefits equal total costs.
d. the price of bread equals exactly the marginal benefit of each loaf.
Answer: b. MB > MC or until they are equal.
Explanation:
It is best that Frieda produces bread at the level where Marginal benefits exceeds marginal costs. The difference will keep giving her more profit.
She should keep increasing her production so long as the Marginal benefit exceeds marginal cost but should stop at the level where the Marginal benefit and marginal cost become equal because producing past this point would mean that she would incur a marginal loss on each unit.
What is true of a good at a market clearing price?
A)
There is no competitive market for the good.
B)
Quantity supplied is greater than quantity demanded.
C)
Producers must lower inventory in order to increase demand.
D)
The quantity of a good demanded is equal to the quantity supplied.
Answer:
D. The quantity of a good demanded is equal to the quantity supplied.
Explanation:
Deman will not change, but supply decrease. Demand will decrease.
Spalding Pointers Corporation expects to begin operations on January 1, year 1; it will operate as a specialty sales company that sells laser pointers over the Internet. Spalding expects sales in January year 1 to total $120,000 and to increase 5 percent per month in February and March. All sales are on account. Spalding expects to collect 70 percent of accounts receivable in the month of sale, 20 percent in the month following the sale, and 10 percent in the second month following the sale. Required Prepare a sales budget for the first quarter of year 1.
Answer:
Spalding Pointers Corporation
Sales Budget
For the first quarter of year 1.
Details January February March
Sales revenue ($) 120,000 126,000 132,300
Explanation:
Before preparing the sales budget, the following are calculated first:
Expected sales in January year 1 = $120,000
Expected sales in February year 1 = Expected sales in January year 1 * (100% + Expected percentage increase) = $120,000 * (100% + 5%) = $126,000
Expected sales in March year 1 = Expected sales in February year 1 * (100% + Expected percentage increase) = $126,000 * (100% + 5%) = $132,300
The sales budge will now look as follows:
Spalding Pointers Corporation
Sales Budget
For the first quarter of year 1.
Details January February March
Sales revenue ($) 120,000 126,000 132,300
During the month of September, the following transactions occurred. The applicable sales tax rate is 6%.
Sept. 2 Sold merchandise on account to Sam Larson, $1,400, plus sales tax.
7 Sold merchandise on account to David Mitchell, $1,900, plus sales tax.
12 Issued credit memorandum to Sam Larson for $689, including sales tax of $39.
22 Sold merchandise on account to Matt Feustal, $500, plus sales tax.
28 Sold merchandise on account to Ana Cardona, $850, plus sales tax.
Enter the transactions in the general journal.
Answer:
Sept. 2
Dr Accounts Receivable-Sam Larson 1484
Cr Sales 1400
Cr Sales Tax Payable 84
Sept. 7
Dr Accounts Receivable-David Mitchell 2014
Cr Sales 1900
Cr Sales Tax Payable 114
Sept. 12
Dr Sales Returns and Allowances 650
Dr Sales Tax Payable 39
Cr Accounts Receivable-Sam Larson 689
Sept. 22
Dr Accounts Receivable-Matt Feustal 530
Cr Sales 500
Cr Sales Tax Payable 30
Sept. 28
Dr Accounts Receivable-Ana Cardona 901
Cr Sales 850
Cr Sales Tax Payable 51
Explanation:
Preparation of the general journal entries
Sept. 2
Dr Accounts Receivable-Sam Larson 1484
(1400+84)
Cr Sales 1400
Cr Sales Tax Payable 84
(1400*6%)
Sept. 7
Dr Accounts Receivable-David Mitchell 2014
(1900+114)
Cr Sales 1900
Cr Sales Tax Payable 114
(1900*6%)
Sept. 12
Dr Sales Returns and Allowances 650
(689-39)
Dr Sales Tax Payable 39
Cr Accounts Receivable-Sam Larson 689
Sept. 22
Dr Accounts Receivable-Matt Feustal 530
(500+30)
Cr Sales 500
Cr Sales Tax Payable 30
(500*6%)
Sept. 28
Dr Accounts Receivable-Ana Cardona 901
(850+51)
Cr Sales 850
Cr Sales Tax Payable 51
(850*6%)
Which one of the following statements is TRUE?
a. The supervisor-employee relation between a production line supervisor and a production line operator is an example of an agency relationship.
b. An example of an agency relationship is when the CEO nominates a slate of candidates to be on the board of directors.
c. An example of an agency relationship is when a supervisor hires a forklift operator.
d. In an agency relationship, the principal delegates decision-making authority to the agent.
e. In an agency relationship, the agent delegates authority to the principal."
Answer:
D.
Explanation:
Agency relationship implies that one person referred as principal allows another person agent to take decision or act on former's behalf.
In an agency relationship, the principal delegates decision-making authority to the agent.
Below are the transactions and adjustments that occurred during the first year of operations at Kissick Co
a. Issued 198,000 shares of $6-par-value common stock for $1,188,000 in cash.
b. Borrowed $550,000 from Oglesby National Bank and signed a 11% note due in three years.
c. Incurred and paid $380,000 in salaries for the year.
d. Purchased $650,000 of merchandise inventory on account during the year.
e. Sold inventory costing $580,000 for a total of $910,000, all on credit.
f. Paid rent of $220,000 on the sales facilities during the first 11 months of the year.
g. Purchased $190,000 of store equipment, paying $51,000 in cash and agreeing to pay the difference within 90 days.
h. Paid the entire $139,000 owed for store equipment and $600,000 of the amount due to suppliers for credit purchases previously recorded.
i. Incurred and paid utilities expense of $36,000 during the year.
j. Collected $845,000 in cash from customers during the year for credit sales previously recorded.
k. At year-end, accrued $60,500 of interest on the note due to Oglesby National Bank.
l. At year-end, accrued $20,000 of past-due December rent on the sales facilities.
Required:
Prepare an income statement (ignoring income taxes) for Kissick Co.'s first year of operations and a balance sheet as of the end of the year.
Answer:
Income Statement Sales 9,00,000 Cost of goods sold 5,80,000 Gross profit 3,20,000 Salaries expense 3,90,000 Rent expense 2,40,000 Utilities expense 38,000 Loss from operations -3,48,000 Interest expense -59,400 Net loss -4,07,400 KI
Explanation:
Purchased $190,000 of store equipment, paying $51,000 in cash and agreeing to Paid the entire $139,000 owed for store equipment and $600,000 of the amount due to suppliers for credit purchases previously recorded. pay the difference within 90 days. that make it a way to create sales.
Symington Corporation uses the periodic inventory system. At December 31, 20X1, the end of the company's fiscal year, a physical count of inventory revealed an ending inventory balance of $320,000. The following items were not included in the physical count: Goods held on consignment at Murphy Corporation $ 23,000 Merchandise shipped to a customer on 12/30/20X1 f.o.b. destination (merchandise arrived at customer's location on 1/3/20X2) 12,000 Merchandise shipped to a customer on 12/29/20X1 f.o.b. shipping point (merchandise arrived at customer's location on 1/2/20X2) 6,000 Merchandise purchased from a supplier, shipped f.o.b. destination on 12/29/20X1, in transit at year-end 24,000
Symington's 2018 ending inventory should be:________
Answer:
See below
Explanation:
With regards to the above information, Symington's 2018 ending inventory would be computed as seen below;
= Ending inventory balance at December 31, 20X1 + Goods held on consignment at Murphy corporation + Merchandize shipped to customer on 12/30 and arrived at customer' location on 1/3/2017
= $320,000 + $23,000 + $12,000
= $355,000
Therefore, Symington's 2018 ending balance should be $355,000.
Note that other given information are not relevant to the computation of the ending inventory.
The following cost behavior patterns describe anticipated manufacturing costs for 2019: raw material, $7.50/unit; direct labor, $10.50/unit; and manufacturing overhead, $297,500 $8.50/unit. Required: If anticipated production for 2019 is 35,000 units, calculate the unit cost using variable costing and absorption costing. (Round your answers to 2 decimal places.)
Answer:
Unit cost
$
Variable costing 18
Absorption costing 26.5
Explanation:
Variable costing values every unit produced at the marginal cost. Marginal cost is the sum of direct material, direct labor and variable overhead.
Marginal cost = 7.50 + 10.50 =$18
Absorption costing values every unit at full cost. Full cost is the sum of marginal and fixed overhead cost per unit,
Fixed overhead cost per unit = $297,500/35,000=8.5
Full cost = 7.50 + 10.50 + 8.50= $26.5
Unit cost
$
Variable costing 18
Absorption costing 26.5
4. Suppose the spot Yuan/dollar exchange rate is 6.79. Sue, a Chinese national, has 10,000 Yuan that she wants to invest in a U.S. asset that promises an annual interest of 7 percent. If the expected exchange rate (Yuan/dollar) after a year is 7.2, how much will Sue earn in Yuan
Answer:
Spot exchange rate (Yaun / Dollar) = 6.79 > Therefore, exchanging Yuan for Dollar: 10,000 Yuan.
Explanation:
Yuan/Dollar existing exchange rate is 6.79 Sue has 10,000 Yuan which is converted to 10,000 / 6.79
The following information is taken from the 2020 general ledger of Swisher Company. Rent Rent expense $48,000 Prepaid rent, January 1 5,900 Prepaid rent, December 31 9,000 Salaries Salaries and wages expense $54,000 Salaries and wages payable, January 1 10,000 Salaries and wages payable, December 31 8,000 Sales Sales revenue $175,000 Accounts receivable, January 1 16,000 Accounts receivable, December 31 7,000 In each case, compute the amount that should be reported in the operating activities section of the statement of cash flows under the direct method. Cash payments for rent $ Cash payments for salaries $ Cash receipts from customers
Answer:
See below
Explanation:
1. Cash payments
= Rent expense + Prepaid rent, December 31 - Prepaid rent January 1
= $48,000 + $9,000 - $5,900
= $51,100
2. Cash payments for salaries
= Salaries and wages expense + salaries and wages payable January 1, - salaries and wages payable December 31
= $54,000 + $10,000 - $8,000
= $56,000
3. Cash receipts from customers
= Sales revenue + Accounts receivables January 1 - Accounts receivables, December 31
= $175,000 + $16,000 - $7,000
= $184,000
The law of diminishing marginal returns: a. states that each and every increase in the amount of the variable factor employed in the production process will yield diminishing marginal returns b. is a mathematical theorem that can be logically proved or disproved c. is the rate at which one input may be substituted for another input in the production process d. none of the above
Answer:
d. none of the above
Explanation:
In Economics, The law of diminishing marginal utility states that as the unit of a good or service consumed by an individual increases, the additional satisfaction he or she derives from consuming additional units would start decreasing or diminishing as the units of good or service consumed increases.
Also, the marginal utility of goods and services is the additional satisfaction that a consumer derives from consuming or buying an additional unit of a good or service.
For example, buying a chocolate bar and eating it may satisfy your cravings but eating another one wouldn't give you as much satisfaction as the first due to diminishing marginal utility.
A newspaper report states the following: "On March 2, Bastiaan Vanacker was arrested for indecent exposure"; However, what really happened was that someone called Sebastian Van Akker was arrested on March first for indecent exposure. The journalist made a mistake when reading the police report. Both Vanacker and Van Akker sue the newspaper for libel. Given libel jurisprudence, which of the following is most likely to happen? They both are private figures.
a. Bastiaan Vanacker wins a libel suit , Sebastian Van Akker loses.
b. Sebastian Van Akker wins a libel suit, Bastiaan Vanacker loses a libel suit.
c. They both win a libel suit.
d. They both lose a libel suit
Answer:
a. Bastiaan Vanacker wins a libel suit , Sebastian Van Akker loses.
Explanation:
Libel is where a defamatory statement has been published and that statement is false, this will result in the person able to claim libel charges.
This means that if information about someone is publicised (specially a private figure) for any criminal act and which could lead to damage that person's reputation seriously without any proper evidence or even false evidence then this would become ground for a libel case.
Such as in this case where a journalist reported that Bastiaan Vanacker was arrested for indecent exposure even though this was not really the case. As confirmed through the police report which the journalist had misread. This libel suit filed by Bastiaan Vanacker would be won, as his reputation has been damaged to the falsely alleged report published in the newspaper.
However, in the case of Sebastian Van Akker, who had actually committed the crime and no information was mentioned about him in the newspaper, will lose the libel suit filed. This is due to the fact that he was not defamed for any act which he himself had not conducted.
Playoff Corporation acquired 80% ownership of Stadium Corporation on January 1, 2010 for $160,000. On that date, the fair value of the noncontrolling interest was $40,000, and Stadium reported retained earnings of $50,000 and had $100,000 of common stock outstanding. Playoff uses the equity method. On the date of acquisition, the fair value of Stadium’s depreciable assets was $50,000 more than book value and those assets had a 10 year remaining life. The pre-closing trial balance data for Playoff and Stadium on December 31, 2014, included the following:Playoff books:Stadium books:Investment in Stadium Co. Stock$188,000Dividends Declared$ 10,000Income from Subsidiary 20,000Common Stock 100,000Retained Earnings 90,000Net Income for the year 30,000Required: a. Provide all the journal entries recorded by Playoff during 2014 related to their investment in Stadium.Investment in Stadium24,000 Income from S24,000Cash8,000 Investment in Stadium8,000Income from S4,000 Investment in Stadium4,000b. Provide all workpaper entries needed to prepare a consolidation workpaper as of December 31, 2014. CAD: FV 200 – BV 150 = Diff 50 – Dep assets 50 / 10 yr life = $5,000Common Stock 100,000Retained Earnings 90,000 Investment in Stadium152,000 Noncontrolling Interest 38,000Buildings and Equipment50,000 Accumulated Depreciation25,000 Investment in Stadium NCI
Answer:
A. Dr Investment in Stadium $24,000
Cr Income from S $24,000
Dr Cash $8,000
Cr Investment in Stadium $8,000
Dr Income from S $4,000
Cr Investment in Stadium $4,000
B. Dr Common Stock $100,000
Cr Retained Earnings $90,000
Cr Investment in Stadium $152,000
Cr Noncontrolling Interest $38,000
Dr Buildings and Equipment $50,000
Cr Accumulated Depreciation $25,000
Cr Investment in Stadium $20,000
Cr Noncontrolling Interest $5,000
Dr Depreciation expense $5,000
Cr Income from S $4,000
Cr Income to Noncontrolling Interest $1,000
Dr Income from S $24,000
Cr Investment in Stadium $24,000
Dr Investment in Stadium $8,000
Cr Dividend declared $8,000
Dr Income to Noncontrolling Interest $6,000
Cr Noncontrolling Interest $6,000
Dr Noncontrolling Interest $2,000
Cr Dividend declared $2,000
Explanation:
a. Preparation of the journal entries recorded by Playoff during 2014 related to their investment in Stadium
Dr Investment in Stadium $24,000
Cr Income from S $24,000
($30,000*80%)
Dr Cash $8,000
Cr Investment in Stadium $8,000
($10,000*80%)
Dr Income from S $4,000
Cr Investment in Stadium $4,000
[($30,000*80%)-$20,000]
($24,000-$20,000)
b. Computation to Provide all workpaper entries needed to prepare a consolidation workpaper as of December 31, 2014.
CAD: Fair Value ($160,000+$40,000)– Book Value $150,000
=Fair Value $200,000– Book Value $150,000
= $50,000
Depreciation=$50,000 / 10 year life
Depreciation=$5,000
Dr Common Stock $100,000
Cr Retained Earnings $90,000
Cr Investment in Stadium $152,000
($160,000-$8,000)
Cr Noncontrolling Interest $38,000
($100,000+$90,000-$152,000)
Dr Buildings and Equipment $50,000
Cr Accumulated Depreciation $25,000
Cr Investment in Stadium $20,000
Cr Noncontrolling Interest $5,000
($50,000-$25,000-$20,000)
Dr Depreciation expense $5,000
Cr Income from S $4,000
($24,000-$20,000)
Cr Income to Noncontrolling Interest $1,000
($5,000-$4,000)
Dr Income from S $24,000
Cr Investment in Stadium $24,000
($30,000*80%)
Dr Investment in Stadium $8,000
Cr Dividend declared $8,000
($10,000*80%)
Dr Income to Noncontrolling Interest $6,000
($5,000+$1,000)
Cr Noncontrolling Interest $6,000
Dr Noncontrolling Interest $2,000
Cr Dividend declared $2,000
($8,000-$6,000)
Knowledge Check 01 The standard quantity per unit defines the ________. multiple choice price that should be paid for each unit of direct materials. total cost of direct materials that should be used for each unit of finished product. amount of direct materials that should be used for each unit of finished product including an allowance for normal inefficiencies, such as scrap and spoilage. amount of direct labor-hours that should be used to produce one unit of finished goods.
Answer:
amount of direct materials that should be used for each unit of finished product including an allowance for normal inefficiencies, such as scrap and spoilage.
Explanation:
Standard quantity per unit is defined as materials that the manufacturer needs to complete a unit of a product. It also allows for inefficiencies such as spoilage and scrap.
It is used by managers to reduce wastage that exists during production by allocation of only the required amount of direct materials in the production process.