Answer:
nope ps3 is not important
During January, Luxury Cruise Lines incurs employee salaries of $2.4 million. Withholdings in January are $183,600 for the employee portion of FICA, $360,000 for federal income tax, $150,000 for state income tax, and $24,000 for the employee portion of health insurance (payable to Blue Cross Blue Shield). The company incurs an additional $148,800 for federal and state unemployment tax and $72,000 for the employer portion of health insurance.
Record the employee salary expense, withholdings, and salaries payable.
This is what i have so far please help!
Debit 2Million
Credit FICA 153,000
Credit Income Tax 425000
Credit Account payable ????
Credit Salaries Payable ????
Answer and Explanation:
The journal entry to record the employee salary expense, withholdings, and salaries payable is shown below:
Salaries expense Dr $2,400,000
To Income tax payable ($360,000 + $150,000) $510,000
To FICA tax payable $183,600
To Account payable $24,000
To Salaries payable $1,682,400
(being employee salary expense, withholdings, and salaries payable is recorded)
Here the expenses are debited and payable are credited as it increased the expenses and liabilities
The following data pertain to Ronaldo Enterprises:
Variable manufacturing cost $70
Variable selling and administrative cost 20
Applied fixed manufacturing cost 40
Allocated fixed selling and administrative cost 15
What price will the company charge if the firm uses cost-plus pricing based on absorption manufacturing cost and a markup percentage of 110%?
A. $231.
B. $147.
C. $84.
D. $210.
Answer:
its b i am pretty sure its b
You have just purchased a new DVD player to show videos to your customers. The DVD player costs $500, and you depreciate the machine at a rate of 25% each year. You can borrow money from the bank at 10%, or receive 6% for depositing money at the bank. The expected inflation rate in the coming year is 5%. You used the company's own funds to purchase the DVD player. The firm's user cost of capital for the first year is:__________.
A. $130
B. $150.
C. $155.
D. $175.
Answer: $130
Explanation:(.25 + .06 - .05)*500
The cost of capital for the DVD is $130. The correct answer is option A.
What is cost of capital?Cost of capital is a the minimum return that would be necessary for a company to justify undertaking a capital budgeting project.
Cost of Capital (k) = Cost of the DVD × ( Rate of depreciation + Borrowing rate + rate of deposit)
k = $500( 0.25+0.10+0.06)
= $130
Therefore, the cost of capital for the first is $130.
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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
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
cholastic Tours is trying to decide which one of two tours it will introduce. The costs and revenues associated with each alternative are listed below: Eastern Tour Western Tour Projected revenue $ 11,000 $ 13,000 Variable costs 2,000 6,000 Fixed costs 3,000 3,000 Profit $ 6,000 $ 4,000 What are the incremental (differential) costs of the Western Tour
Answer:
Results are below.
Explanation:
Giving the following information:
Eastern Tour Western Tour
Projected revenue $ 11,000 $ 13,000
Variable costs 2,000 6,000
Fixed costs 3,000 3,000
Profit $ 6,000 $ 4,000
Western Tour provides a higher projected revenue ($2,000 higher), but also higher variable costs. The variable cost of Eastern Tour is $4,000 lower, making it the more profitable option, as fixed costs are equal.
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
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
Russell Retail Group begins the year with inventory of $65,000 and ends the year with inventory of $55,000. During the year, the company has four purchases for the following amounts. Purchase on February 17 $ 220,000 Purchase on May 6 140,000 Purchase on September 8 170,000 Purchase on December 4 420,000 Required: Calculate cost of goods sold for the year.
Answer:
COGS= $960,000
Explanation:
Giving the following information:
Beginning inventroy= $65,000
Ending inventory= $55,000
Total Purchase= 220,000 + 140,000 + 170,000+ 420,000= $950,000
To calculate the cost of goods sold, we need to use the following formula:
COGS= beginning inventory + cost of goods purchased - ending inventory
COGS= 65,000 + 950,000 - 55,000
COGS= $960,000
1) Record the following transactions in the General Fund General Ledger of Benford Township using the consumption method (periodic inventory system) to account for materials, supplies, and prepayments. Record both the budget-ary and actual entries.
2) Compute the amount of expenditures to be reported in the school district General Fund statement of revenues, expenditures, and changes in fund balance.
3) Compute the amount of nonspendable fund balance to be reported at year end. Materials and supplies costing $90,000 were on hand at the beginning of the year. 1. The town ordered the following:
Estimated Cost
Garbage vehicles—4 . . . . . . . . . . . . . . . . . . . . . . . $225,000
Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 312,000
2. The town received the garbage vehicles. The actual cost of $222,000 was vouchered for payment.
3. The town received most of the supplies ordered (estimated cost $302,000). The actual cost was $301,800.
4. The town paid $523,800 of vouchers payable.
5. At yearend, the town had supplies on hand costing $102,000.
Answer:
1)
1. Dr Encumbrances $537,000
Cr Reserve for Encumbrances $537,000
2. Dr Reserve for Encumbrances $222,000
Cr Encumbrances $222,000
Dr Expenditures – Capital Outlay - Trucks $222,000
Cr Vouchers Payable $222,000
3. Dr Reserve for Encumbrances $302,000
Cr Encumbrances $302,000
Dr Inventory – Materials and Supplies $301,800
Cr Vouchers Payable $301,800
4. Dr Vouchers Payable $523,800
Cr Cash $523,800
5. Dr Inventory -Materials and Supplies $12,000
Cr Expenditures – Materials and Supplies $12,000
2) $511,800
3) $102,000
Explanation:
1) To Record the transactions in the General Fund General Ledger of Benford Township using the consumption method and to Record both the budget-ary and actual journal entries.
1. Preparation of the journal entry if The town ordered Garbage vehicles of the amount of $225,000 and Supplies of the amount of $312,000
Dr Encumbrances $537,000
Cr Reserve for Encumbrances $537,000
($225,000+312,000)
2. Preparation of The journal entry if The actual cost of the amount of $222,000 was vouchered for payment.
Dr Reserve for Encumbrances $222,000
Cr Encumbrances $222,000
Dr Expenditures – Capital Outlay - Trucks$222,000
Cr Vouchers Payable $222,000
3. Preparation of the journal entry if The town received most of the supplies ordered (estimated cost of the amount of $302,000) while The actual cost was the amount of $301,800.
Dr Reserve for Encumbrances $302,000
Cr Encumbrances $302,000
Dr Inventory – Materials and Supplies $301,800
Cr Vouchers Payable $301,800
4. Preparation of the journal entry if The town paid the amount of $523,800 of vouchers payable.
Dr Vouchers Payable $523,800
Cr Cash $523,800
5. Preparation of the Journal entry if At year end, the town had supplies on hand costing the amount of $102,000
Dr Inventory -Materials and Supplies $12,000
Cr Expenditures – Materials and Supplies $12,000
($523,800-$511,800)
2) Computation for the amount of expenditures to be reported in the school district General Fund statement of revenues, expenditures, and changes in fund balance
EXPENDITURES
Capital Outlay $222,000
Materials and Supplies:
Beginning Inventory $90,000
Purchases$301,800
Total Available$391,800
Less Ending Inventory ($102,000)$289,800
($391,800-$102,000)
Total $511,800
($222,000+$289,800)
Therefore the amount of expenditures to be reported in the school district General Fund statement of revenues, expenditures, and changes in fund balance is $511,800.
3) Based on the information given we were told that At the end of the year the town had supplies on hand costing the amount of $102,000 which means that The amount of nonspendable fund balance to be reported at year end will equal to Inventory on hand of the amount of $102,000.
Mccabe Corporation uses the weighted-average method in its process costing. The following data pertain to its Assembly Department for September. Percent Complete Units Materials Conversion Work in process, September 1 1,200 55 % 10 % Units started into production during September 8,600 Units completed during September and transferred to the next department 7,700 Work in process, September 30 2,100 75 % 25 % Required: Compute the equivalent units of production for both materials and conversion costs for the Assembly Department for September using the weighted-average method.
Answer and Explanation:
The computation of the equivalent units of production for both materials and conversion costs is given below:
For material
= Units completed + ending work in process × completion percentage
= 7,700 + 2,100 × 0.75
= 9,275 units
And, for conversion cost
= Units completed + ending work in process × completion percentage
= 7,700 + 2,100 × 0.25
= 8,225 units
When following up with a customer it is important to ___.
a. make the process easy on the employee
b. make the process a little unpleasant
c. keep it in the store's best interest
d. use a method suited to the customer
Answer:
When following up with a customer it is important to ___.
d. use a method suited to the customer
Explanation:
To ensure a great customer experience, it is important that follow-up steps are followed. In the first place, following up with a customer improves their overall experience with the company. Customer follow-up helps to solve problems a long time before they become an unmanageable issue. It endears the customer to the entity and its products and services. It enriches a trusty relationship, engendering great customer's experience and service.
Bank Sohar declares the profit for the year ended 2019-20. They makes profit:
a.
When bank Sohar asset is less than the liability
b.
When their rate of interest on loan is greater than the deposit rates
c.
When their bank liability is greater than their assets
d.
When their rate of interest on loan is less than the deposit rates
Answer:
Option B
Explanation:
A bank makes profit when it gets more returns on the loan given as compared to the interest given on the deposited money.
Hence, option B is correct. In case A and C liability is greater than asset and hence this situation does not signify a profitable situation.
Also, option D is just the opposite of option B (profitable situation).
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.
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
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
After a rough week and against her better judgment, Pari tells Vihaan she is tired of arguing with him over trip reports. She makes an exception for him and, against policy, says he no longer needs to fill them out. A week later, another sales rep comes to her and asks to stop preparing reports, just like Vihaan. Why do you think Pari now has a managerial problem
Answer:
Hello the options related to your question is missing below are the missing options
A. She administered punishment to Vihaan.
B. She misused the ERG theory with Vihaan.
C. She failed to provide procedural justice.
D. She misused the expectancy theory with Vihaan.
answer : She failed to provide procedural justice. ( C )
Explanation:
Pari has a managerial problem because she failed to provide procedural Justice
Procedural justice is simply treating every employee equally as regards to a certain work procedure at the workplace, Pari did not exhibit that when she excepted Vihaan
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
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.
Javier is a department manager at a big box store. Over the last month, sales have slumped, and he has lots of inventory going unsold. Now it’s time to put in his orders to restock for next month. a. How, if at all, should Javier adjust his orders for new products? Javier should place his orders according to his initial estimates. The inventory buildup is not an equilibrium. Javier should respond by cutting back on his orders. Javier should wait and see what happens next month, and if his inventory runs out, then he can place an order. b. How will his suppliers respond to this decision? They will produce according to their initial demand estimates. They will cut back on production. They will not be affected. They will expand their output. c. Most other businesses are experiencing a similar decline in sales. Which
Question Completion:
c. Most other businesses are experiencing a similar decline in sales. Which of the following are is likely to occur as a result of the decline in sales?
Aggregate expenditure will fall.
Aggregate expenditure will rise.
Output will not be affected, and eventually, sales will rise to bring the economy back to equilibrium.
Output will fall in response to the decline, as businesses adjust their production.
Answer:
a. How Javier should adjust his orders for new products:
The inventory buildup is not an equilibrium. Javier should respond by cutting back on his orders.
b. How the suppliers will respond to Javier's decision:
They will cut back on production.
c. The consequences of the decline in sales are:
Aggregate expenditure will fall.
Output will fall in response to the decline, as businesses adjust their production.
Explanation:
Aggregate Expenditure determines the total amount spent by firms and households on goods and services during a specific period of time. Inventory management is one of the duties of Javier at the department store. This involves ordering, warehousing, and processing inventory to achieve maximum customer satisfaction.
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
Fill in the blanks to complete the sentence. A manufacturing company has budgeted production at 5,000 units for May and 4,400 units in June. Each unit requires 3 pounds of materials at a cost of $10 per pound. On May 1, there are 2,750 pounds of materials on hand. The company desires an ending inventory of 60% of the next month's materials requirements. The total cost of direct materials purchases for May will be $ .
Answer:
Direct material purchases in May = 21,670× $10= $216,700
Explanation:
Material purchase budget is determined by adding the closing inventory of material to the material usage budget less the opening inventory.
Material budgets for May will be prepared as follows:
Materials needed for May production = 5,500 × 3 = 16,500
Materials needed for June production = 4,400× 3= 13,200
Closing inventory of raw material in May =60% × June requirement = 60% × 13,200 =7,920
Material purchase budget for February = Usage budget + closing inventory - opening inventory
= 16,500 + 7,920- 2,750=21,670
Direct material purchases in May = 21,670× $10= $216,700
YZ Company is rethinking the way it ships to its 62 customers in another city 220 miles away.
Current Shipping/Delivery Method
They currently hire an LTL (less-than-truckload) carrier to pick up and deliver these shipments. Each customer order shipped via LTL carrier costs $147.
Alternate Shipping/Delivery Method
A 3PL (third-party logistics provider) has approached XYZ Company and suggested that they make full truckload (TL) shipments from their facility to the 3PL's warehouse in the customers' city. The 3PL would then break the bulk shipment (TL or truckload shipment) into individual customer orders to be shipped locally by an LTL carrier. The relative data for this alternate shipping method are as follows:
Full TL shipment cost (220 miles) = $675
Average order weight = 750 lbs.
Warehouse break-bulk fee (per 100 lbs., a.k.a. per "hundred weight") = $13
Local LTL delivery fee = $36
1. What is the total cost of delivering to all customers via LTL carrier (current method
R=_______.
2. How much money would XYZ company save by using the alternate shipping/delivery method?
R=______.
3. At what number of customers would the cost of these two methods be the same?
R=______.
Answer:
1. Total cost of customer order shipped via LTL carrier is $9,114.
2. XYZ company would save $162 by using the alternate shipping/delivery method.
3. The cost of these two methods would be the same when the number of customers is approximately 6.
Explanation:
To ease answering the question, let us first the define as follows:
N = Number of customers = Number of Order
A = Each customer order shipped via LTL carrier costs = $147
B = Average order weight = 750
C = Warehouse break-bulk fee per hundred weight = 13
D = Total cost of weight = ((N * B) / 100) * C
E = Local LTL delivery fee = $36
F = Total Local LTL delivery fee = N * E
G = Full TL shipment cost (220 miles) = 675
H = Total cost of shipping using 3PL = D + F + G
I = Total cost of customer order shipped via LTL carrier = N * A
J = Difference between the cost of the two methods = I - H
1. What is the total cost of delivering to all customers via LTL carrier (current method
This can be calculated using E above as follows:
Total cost of customer order shipped via LTL carrier = E = N * A = 62 * $147 = $9,114
2. How much money would XYZ company save by using the alternate shipping/delivery method?
From the definitions above, we have:
N = Number of orders = 62
D = Total cost of weight = ((N * B) / 100) * C = ((62 * 750) / 100) * 13 = $6,045
F = Total Local LTL delivery fee = N * E = 62 * 36 = $2,232
G = Full TL shipment cost (220 miles) = $675
H = Total cost of shipping using 3PL = D + F + G = $6,045 + $2,232 + $675 = $8,952
I = Total cost of customer order shipped via LTL carrier = $9,114
J = Difference between the cost of the two methods = I - H = $9,114 - $8,952 = $162
Therefore, XYZ company would save $162 by using the alternate shipping/delivery method.
3. At what number of customers would the cost of these two methods be the same?
H = Total cost of shipping using 3PL = D + F + G = (((N * B) / 100) * C) + (N * E) + G ............ (1)
Substituting all the relevant value into equation (1), we have:
H = (((N * 750) / 100) * 13) + (N * 36) + 675
I = N * 147
Equating H and I and solve for N, we have:
(((N * 750) / 100) * 13) + (N * 36) + 675 = N * 147
((N0.01 * 7.50) * 13) + 675 = N147 - N36
(N0.075* 13) + 675 = N111
N0.975 + 675 = N111
675 = N111 - N0.975
N110.025 = 675
N = 675 / 110.025
N = 6.13496932515337.
By approximating to a whole number since we are talking about human being, we have:
N = 6
At what number of customers would
Therefore, the cost of these two methods would be the same when the number of customers is approximately 6.
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.
example of small scale business
Torge Company bought a machine for $74,000 cash. The estimated useful life was five years and the estimated residual value was $5,000. Assume that the estimated useful life in productive units is 165,000. Units actually produced were 44,000 in year 1 and 49,500 in year 2.
Required:
1. Determine the appropriate amounts to complete the following schedule. (Do not round intermediate calculations.)
Depreciation Expense for Depreciation Expense for Book Value at the End of Method of Depreciation Book Value at the End of Method of Depreciation
Method of Depreciation Year 1 Year 2 Year 1 Year 2
Straight-line
Units-of-production
Double-declining-balance
2. Which method would result in the lowest net income for year 1?
3. Which method would result in the lowest net income for year 2?
4. Which method would result in the lowest fixed asset turnover ratio for year 1?
Answer:
Straight line depreciation
Depreciation expense Book Value at the End of Year 1 $13800 $60,200
Year 2 $13800 $46,400
Units of production
Depreciation expense Book Value at the End of Year 1 $18400 $55,600
Year 2 $20,700 $34,900
Double declining balance
Depreciation expense Book Value at the End of Year 1 $29600 $44,400
Year 2 $17,760 $26,640
2. Double-declining-balance
3. Units-of-production
4. Straight-line
Explanation
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
($74,000 - $5000) / 5 = $13800
Depreciation expense each year would be $13800
Book value = cost of asset - depreciation
Book value in year 1 = $74,000 - $13800 = $60,200
Book value in year 2 = $60,200 - $13800 = $46,400
Unit of production = (total output that year / total output of the machine) x (Cost of asset - Salvage value)
Deprecation expense in year 1 = (44,000 / 165,000) x ($74,000 - $5000) = $18400
Deprecation expense in year 2 = (49,500 / 165,000) x ($74,000 - $5000) = $20700
Book value in year 1 = $74,000 - $18,400 = $55,600
Book value in year 2 = $55,600 - $20700 = $34,900
Depreciation expense using the double declining method = Depreciation factor x cost of the asset
Depreciation factor = 2 x (1/useful life) = 2/5 = 0.4
Deprecation expense in year 1 = 0.4 x $74,000 = $29600
Book value in year 1 = $74,000 - $29600 = $44,400
Deprecation expense in year 2 = 0.4 x $44,400 = $17,760
Book value in year 2 = $44,400 - $17,760 = $26,640
Net income is revenue less cost of goods sold, general expenses, taxes, depreciation and interest.
The method that would yield the lowest net income in year 1 is the method that yields the highest deprecation expense in year 1. This is the double declining method
The Units-of-production would yield the lowest net income in year 2 because it has the highest depreciation expense
Fixed asset turnover = revenue / average net fixed assets
average net fixed assets = cost of asset - accumulated depreciation
the higher the average net fixed asset, the lower the fixed asset turnover. The depreciation method that yields the lowest depreciation expense in year 1 would have the lowest fixed asset turnover ratio. This is the straight line method
Able conveyed real property in Michigan to Baker in a correctly draft and signed deed. Baker accurately and immediately recorded the deed with the appropriate county offices. After the recording of the deed, Able accepted money from Charlie and signed a new deed for the same property purporting to convey the property to Charlie. Charlie had not been told of the earlier transfer to Baker. In a dispute between Baker and Charlie, which of the following statements is most accurate.
A. Charlie will prevail over Baker because the deed from Able to Baker fails
B. Charlie will prevail over Baker because Charlie paid money to Able
C. Baker will prevail over Charlie because Baker recorded the deed before a Charlie paid Able for the property
D. Baker will prevail over Charlie, unless Able told Charlie of the prior transfer to Baker since that would have been his obligation
Answer: C. Baker will prevail over Charlie because Baker recorded the deed before a Charlie paid Able for the property.
Explanation:
As soon as Baker accurately and immediately recorded the deed with the appropriate county offices after the property was conveyed to him, he took over ownership of the property from Able.
Able received money from Charlie and signed a new deed after this had happened so Baker would prevail because Baker, not Able, owns the property and so Able cannot sell what does not belong to him.
Since Baker registered the deed when Charlie paid Able for the land, he will triumph over Charlie.
Title has been transmitted to Baker since Able ceded real property to Baker in a properly drafted and executed deed that was documented with the relevant county agencies. Able has no rights to the land after transfer, thus he can't transmit something that doesn't belong to him.
So, Option "C" is the correct answer to the following question.
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Texas Roadhouse opened a new restaurant in October. During its first three months of operation, the restaurant sold gift cards in various amounts totaling $1,800. The cards are redeemable for meals within one year of the purchase date. Gift cards totaling $728 were presented for redemption during the first three months of operation prior to year-end on December 31. The sales tax rate on restaurant sales is 4%, assessed at the time meals (not gift cards) are purchased. Texas Roadhouse will remit sales taxes in January.
Required:
a. Record (in summary form) the $2,500 in gift cards sold ( keeping in mind that, in actuality the firm would record each sale of a gift card individually ).
b. Record the $728 in gift cards redeemed, including the 4% sales tax assessed.
c. Determine the balance in the Unearned Revenue account ( remaining liability for gift cards ) Texas Roadhouse will report on the December 31 balance sheet.
Answer:
General Journal Debit Credit
1 Cash 2600
Unearned revenue 2600
(To record gift cards sold)
2 Unearned revenue 832
Sales tax payable 32
Sales revenue 800
(To record gift cards redeemed)
Lease M does not contain a purchase option, but the present value of the lease payments is equal to 91% of the fair value of the leased asset. Lease P does not transfer ownership to the lessee by the end of the lease term, but the lease term is equal to 77% of the estimated economic life of the leased asset. How should the lessee classify these leases
Answer:
Lease M → Finance Lease Lease P → Finance LeaseExplanation:
An operating lease is one where the leasee simply pays rental for the asset. A finance lease on the other hand, has ownership attributes even though ownership is not transferred.
According to U.S. GAAP provisions, a lease is a finance lease if the lease term in more than 75% of the estimated economic life of the leased asset and seeing as this is the case for both Lease M and P, they are both finance leases.
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.