Answer:
1. Factory Rent = Fixed , Product (Indirect Cost)
2. Advertising = Fixed , Period
3. Packing Supplies for Shipping = Variable, Period
4. Factory Security Guard = Fixed, Product (Indirect Cost)
5. Wages of Employees Who Sand the wood = Variable, Product (Direct Cost)
6. Administrative Assistant in Corporate office = Fixed , Period
7. Paper Towels in the Men's Room in the Factory = Fixed , Product (Indirect Cost)
8. Executive Jet = Fixed, Period
9. Lumber = Variable, Product (Direct Cost)
10. Depreciation on Factory Tools (Straight-Line) = Fixed, Product (Indirect Cost)
Explanation:
Product versus Period Cost.
A product cost is attached to the cost object and is included in the valuation of the cost object.All manufacturing costs are product costs.
Period costs are not attached to the products. Non-manufacturing costs are Period costs.
Fixed versus Variable.
Behavior of costs in relationship with Activity will tell us whether a cost is a Fixed cost or Variable Cost.
Fixed Costs remain the same for any level of activity, whilst variable costs vary in direct proportion to with the level of activity.
Direct versus Indirect.
By observation of the cost object, we are able to identify is a cost is a direct cost or indirect cost.
Direct costs can be easily traced on the cost object. Indirect costs are difficult to trace on the cost object.
Requirement 1. Fill in the missing amounts. Begin by completing the income statement.
Toad Company
Income Statement
For the Year Ended December 31, 2012
Sales. . . . . . . . . . . . . . . . . .
$575,000
Cost of goods sold. . . . . . .
Gross profit on sales. . . . . .
215,000
Administrative expenses. .
60,000
Operating income. . . . . . . .
Interest expense. . . . . . . . .
7,000
Income tax expense. . . . .
44,400
Net income. . . . . . . . . . . . .
Toad Company
Balance Sheet
At December 31, 2012
Cash. . . . . . . . . . . . . . . .
$ ?
Accounts payable. . .
$13,500
Accounts receivable. . . . .
12,500
Note payable. . . . . . .
8,800
Inventory. . . . . . . . . . . . .
43,000
Equipment. . . . . . . . . . . . . .
973,000
Contributed capital. .
610,000
Retained earnings. . .
?
Total. . . . . . . . . . . . . . . .
$1,124,500
Total
?
Answer:
Excerpt from Duty, Honor, Country / Every Man a King
General Douglas MacArthur / Huey P. Long
Duty, Honor, Country / Every Man a King
By: General Douglas MacArthur / Huey P. Long
Excerpt of Duty, Honor, Country
General Douglas MacArthur
.
Explanation:
Levi Corporation (a U.S. company) has several transactions with foreign entities. Each transaction is denominated in the local currency unit of the country in which the foreign entity is located. On December 2, 20X1, Levi sold confectionary items to a foreign company at a price of 50,000 yen when the direct exchange rate was 1 yen = $1.15. The account has not been settled as of the year ended December 31, 20X1, when the exchange rate had changed to 1 yen = $1.12. The foreign exchange gain or loss on Levi's records at year-end for this transaction will be:______
A. No gain or loss is reported
B. $1,500 loss
C. $1,500 gain
Answer:
c
Explanation:
Jones Manufacturing Inc. purchases a component from a Chilean supplier. The demand for that component is exactly 70 units each day. The company is open for business 250 days each year. When the company reorders the product, the lead time from the supplier is exactly 10 days. The product costs $14.00. The company determined that its inventory carrying cost is 20 percent. The company's order cost is $30.00. If the company decides to order 1,750 units each time it places an order, what will be the total annual cost of this policy? (Do not include the product cost in your answer.)
Answer:
$2750
Explanation:
Given that:
Demand for the component = 70 units each day.
Opening days in a year = 250
Reorder time rate = 10 dyas
Cost of product = $14.00
Carrying cost = 20% = 0.2
Order cost = $30.00
So if the company decides to order 1,750 units each time it places an order, the objective of this question is to find the total annual cost of this policy.
The total annual cost = total inventory cost + total ordering cost
where:
Total inventory cost = (ordering quantity/2)*unit holding cost
Total inventory cost = (1750/2) × (0.2 × 14)
Total inventory cost = 2450
Total ordering cost = (annual demand/ordering quantity) × ordering cost
Total ordering cost = (70 × 250/1750) × 30
Total ordering cost = ( 70 × 0.1428571429) × 30
Total ordering cost ≅ 300
Total annual cost = 2450 + 300
Total annual cost = $2750
Journalize the entries to record the following selected bond investment transactions for Starks Products: For a compound transaction, if an amount box does not require an entry, leave it blank. a. Purchased for cash $102,000 of Iceline, Inc. 7% bonds at 100 plus accrued interest of $1,190, paying interest semiannually. b. Received first semiannual interest payment. c. Sold $68,000 of the bonds at 102 plus accrued interest of $520.
Answer and Explanation:
The journal entries are shown below:
a) Investment in bonds $102,000
Interest receivable $1,190
To Cash $103,190
(Being the purchased of bonds is recorded for cash)
For recording this we debited the investment in bonds and interest receivable as it increased the assets and credited the cash as it reduced the assets
b) Cash Dr $3,570 ($102,000 × 7% ÷ 2)
To Interest receivable $1,190
To Interest Revenue $2,380
(Being first semiannual interest payment is recorded)
For recording this we debited the cash as it increased the assets and credited the interest receivable and interest revenue as it reduced the assets and increased the revenue
c) Cash $69,880 ($68,000 ×102% + $520)
To Investment in bonds $68,000
To Interest Revenue $520
To Gain in sale of investment $1,360
(Being the sale of the bond is recorded)
For recording this we debited the cash as it increased the assets and credited the investment in bonds and interest revenue & gains as it reduced the assets and increased the revenue
plans to retain and reinvest all of its earnings for the next 30 years. beiginning in year 31, the firm will begin to pay $12 per share dividend. the dividend will increase at a 6% rate annually thereafter. given a required return of 15% what the stock should sell for today
Answer:
The stock should sell for = $2.01
Explanation:
The Dividend Valuation Model is a technique used to value the worth of an asset. According to this model, the worth of an asset is the sum of the present values of its future cash flows discounted at the required rate of return.
The model is given as
P = D× g/(r-g)
P- stock value, g- growth rate , r-m required rate of return
PV of dividend in year 30 = 12/(0.15- 0.06)=133.3333333
PV of dividend in year in year 0 = 133.3333333 × 1.15^(-30)= 2.01
The stock should sell for = $2.01
Suppose a firm that produces pints of gourmet ice cream has monthly fixed costs of $12,000. The variable costs come to $1.50 per pint produced. (for up to 40,000 pints/month) and the firm sells each pint of ice cream for $3. Find the firm's profit function.
Answer:
P(x)=1.5x-12,000
Explanation:
The profit function equation is:
P(x) = R(x) - C(x)
P(X)= Profit
R(x)= Revenue= 3x
C(x)= cost= fixed costs+variable costs=12,000+1.50x
x= number of pints of ice cream
Then, you can replace the equation with the information given:
P(x)=3x-(12,000+1.50x)
P(x)= 3x-12,000-1.5x
P(x)=1.5x-12,000
According to this, the answer is that the firm's profit function is P(x)=1.5x-12,000.
Answer:
$48,000
Explanation:
The Profit function shows the relationship between the total costs and total revenue accrued in a business. It is given by the formula;
Product Function=Total revenue - Total costs.
The fixed costs in a business are those expenses that must be taken care of no matter the level of production. Variable costs however are dependent on the output of the company.
For the firm producing Gourmet ice-cream,
Total Revenue= $3*40000 pints/month = $120,000
Total costs=Fixed cost +Variable costs
= $12,000 + $40000*(1.5)
= $12,000 + $60,000
= $72000
Therefore,
Product Function= $120,000 - $72000
= $48000
Sports Emporium has two operating segments: sporting goods and sports apparel. The income statement for each operating segment is presented below. Required: 1. Complete the "%" columns to be used in a vertical analysis of Sports Emporium's two operating segments. Express each amount as a percentage of sales. (Round your answers to 1 decimal place.) 2. Use vertical analysis to compare the profitability of the two operating segments. Which segment has a higher net income as a percentage of net sales? Sporting Goods Sports Apparel rev: 12_07_2016_QC_CS-
Answer: Please refer to Explanation
Explanation:
1. When using Vertical Analysis, every item in the Income statement is depicted as a percentage of sales.
Sporting Goods Vertical Analysis
Net Sales = 1,800,00/1,800,000 = 100%
Cost of Goods Sold = 1,040,000/1,800,000 = 57.7%
Gross Profit = 760,000 /1,800,000 = 42.2%
Operating Expenses = 450,000 /1,800,000 = 25%
Operating Income = 310,000/1,800,000 = 17.2%
Other Income (Expense) = 20,000 /1,800,000 = 1.1%
Income before tax = 330,000 /1,800,000 = 18.3%
Income tax Expense = 80,000/1,800,000 = 4.4%
Net Income = 250,000/1,800,000 = 13.9%
Sports Apparel Vertical Analysis
Net Sales = 970,000/970,000 = 100%
Cost of Goods Sold = 440,000/970,000 = 45.4%
Gross Profit = 530,000/970,000 = 54.6%
Operating Expenses = 340,000/970,000 = 35.0%
Operating Income = 190,000/970,000 = 19.6%
Other Income (Expense) = 15,000/970,000 = 1.54%
Income before tax = 175,000/970,000 = 18.0%
Income tax Expense = 70,000/970,000 = 7.2%
Net Income = 105,000/970,000 = 10.8%
2. Comparison using Vertical Analysis
Sporting Goods earn a higher net income than Sport Apparel due to them paying a lower tax.Sports Apparel earns a higher Gross Profit than Sporting Goods due to them having a lower Cost of Goods sold. Sports Apparel have higher Operating Expenses than Sporting Goods but still have a higher Operating Income.I have attached the income statement required for the question.
Joe Jones is preparing the statement of cash flows for Apricot Inc. He has determined that the net cash flow provided by operating activities for Apricot is an inflow of $45,042, the net cash flow used in investing activities for Apricot is $20,831, and the net cash flow used in financing activities for Apricot is $27,997. Joe has also determined that Apricot's beginning cash account balance is $12,083. The ending cash account balance for Apricot Inc is
Answer:
The ending cash account balance for Apricot Inc is $8,297.
Explanation:
There are three components in the statement of cash flows:
Operating activities - Here, non-cash items applied to deriving the net income based on the accrual basis are adjusted for. Also, the movement in working capital and liabilities are accounted for.Investing activities encompass the assets purchased to generate the net income.Financing activities: These include activities that are geared towards improving the capital structure of the organization.In deriving the cash flows at the end of the period, the balances in the activities above are added up, either outflow or inflow. Then the addition is added to the beginning balance of cash flows. This is done below.
Net cash flow provided by operating activities $45,042
Net cash flow used in investing activities ($20,831)
Net cash flow used in financing activities ($27,997)
Beginning cash account balance $12,083
Ending cash account balance $8,297
There was a dispute between an automobile insurance company and its insured concerning value in the loss of a truck. The insurance policy required arbitration of disputes. Each party selected an arbitrator; then these two, when unable to agree, selected a third party as umpire. The umpire, without consulting anyone or receiving any testimony, fixed the value of the loss. If challenged, will a court set aside this award?Why or why not?
Answer: The court has no reason to set aside this award.
Explanation:
According to the facts of the case, the arbitrators for both parties were unable to decide and therefore they selected another third person which is the umpire) to help decide on the matter.
Under these circumstances, the third person who is the umpire becomes the chair and will act as a trial court. The umpire award is identical to a ruling given by the trial court and is enforced. The third party that is, the umpire isn't enforced to give any explanation or discussion before giving the award. In case the award isn't followed by any of the parties, it can be enforced by the court. The court has no reason to set aside this award.
Cathy wants to purchase an annuity where she can withdraw $15,000 at the beginning of each year for the next 25 years. She expects to earn 8% compounded annually on her investment. How much should she pay for the annuity?
Answer:
hmm idk i dk
Explanation:
An individual wants to have $95,000 per year to live on when she retires in 30 years. The individual is planning on living for 20 years after retirement. If the investor can earn 6% during her retirement years and 10% during her working years, how much should she be saving during her working life
Answer:
The amount she would be saving during her working life is $1,089,64 and the deposit required for each year is $6,624.21
Explanation:
Solution
Given that:
The amount of income needed for retirement income = P×[1-(1÷(1+r)^n)]÷r
Now,
The Interest rate per annum =6.00%
The Number of years = 2
The Number of compoundings per annum = 1
The Interest rate per period ( r)=6.00%
The period per payment (P)=$ 95,000
The Amount required for retirement income = 95000*[1-(1/(1+6%)^95000]/6% =$1,089,643
Now,
Required deposit for every year (P)=FVA÷([(1+r)^n-1]÷r)
The Interest rate per annum = 10.00%
The Number of years= 30
The number payments per per annum =1 The Interest rate per period ( r)=10.00%
The Number of periods (n)=30
Thus,
The Future value of annuity (FVA) = $1,089,643
Hence the deposit required for each year is = 1089643/(((1+10%)^30-1)/10%)
= $6,624.21
All of the following are considered active job search methods EXCEPT _____.
Redistributive philosophies
Complete the following table by selecting the redistributive philosophy that matches each statement.
Statement Utilitarianism Libertarianism Liberalism
The government should choose policies
to maximize the total utility of everyone
in society.
The government should choose policies
deemed to be just, as evaluated by an
impartial observer behind a "veil of ignorance."
The government should punish crimes and
enforce voluntary agreements, but not redistribute income.
Suppose that Ginny believes that the progressive U.S. tax system is flawed because it supports equality of outcomes rather than equality of opportunity. Which re-distributive philosophy is consistent with Ginny's view?
A. Liberalism
B. Libertarianism
C. Utilitarianism
Answer:
The government should choose policies to maximize the total utility of everyone in society - Utilitarianism
The central goal of Utilitarianism is simply to maximize everyone's benefit (or utility) in society.
The government should choose policies deemed to be just, as evaluated by an impartial observer behind a "veil of ignorance." - Liberalism
This is the central idea of a "Theory of Justice", a book written by John Rawls. This idea has come to represent the ethical justification behind the redistributive philosophy of liberals.
The government should punish crimes and enforce voluntary agreements, but not redistribute income - Libertarianism
Libertarians believed that income redistribution by the government is unfair because the government takes income from the some people without their consent, and gives it to other people. Libertarians support private charity instead.
Suppose that Ginny believes that the progressive U.S. tax system is flawed because it supports equality of outcomes rather than equality of opportunity. Which re-distributive philosophy is consistent with Ginny's view?
Both liberalism and libertarianism can be ascribed to Ginny's view. Liberals and libertarians do not support equality of outcome, they support equality of opportunity.
The difference lies in the degree of inequality that they are able to tolerate: liberals only tolerate inequality up to a certain port, while libertarians do not really have a problem with inequality as long as it is the result of market outcomes.
The utilitarian theory states that the government should choose policies that enhance the total utility of everyone in society.
Utilitarianism's central aim is to maximize everyone's benefit (or utility) in society.
The government should implement policies that are deemed just by an impartial observer operating behind a "veil of ignorance." - Sensitivity
This is the central concept in Robert Rawls' work, "Theory of Justice." This system has come to represent liberals' ethical rationale for their redistributive worldview.
Modern liberalism believes the government should punish crimes and enforce voluntary agreements, but not redistribute income.
Libertarians found that government income redistribution was unjust because it takes the money from some people against their agreement and distributes it to others. Instead, libertarians advocate for private philanthropy.
Ginny's views can be attributed to feminism and libertarianism. Liberals and libertarians believe in inequality rather than equality of result.
The difference would be in the degree of inequality they can tolerate: liberals could only accept disparity up to a certain amount, but libertarians do not even mind injustice as long as it's the product of market results.
To know more about the redistributive policies, refer to the link below:
https://brainly.com/question/16733925
ROI and Residual Income The following investment opportunities are available to an investment center manager: Project Initial Investment Annual Earnings A $ 800,000 $ 90,000 B 100,000 20,000 C 300,000 25,000 D 400,000 60,000 Required: a. If the investment manager is currently making a return on investment of 16 percent, which project(s) would the manager want to pursue
Answer:
B
Explanation:
ROI = Operating income / Operating assets
ROI for proejct A=$90,000/$800,000=11.25%
ROI for Project B=$20,000/$100,000=20% ROI for Project C=$25,000/$300,000=8.33% ROI for Project D=$60,000/$400,000=15%
If ROI is 16%, project B should be chosen because the ROI is greater than 16%
I hope my answer helps you
Answer:
Project B
Explanation:
The return on investment(ROI)=annual earnings on investment/initial investment
For project A,return on investment=$90,000/$800,000=11.25%
For project B,return on investment=$20,000/$100,000=20.00%
For project C,return on investment=$25,000/$300,000=8.33%
For project D,return on investment=$60,000/$400,000=15.00%
Since the investment manager is only interested in project that has at least 16% return on investment,the only project worthy of investing in is project B with return on investment of 20%
Kalen is a seventeen-year-old minor who has just graduated from high school. He is attending a university two hundred miles from home and has contracted to rent an apartment near the university for one year at $500 per month. He is working at a convenience store to earn enough income to be self-supporting. After living in the apartment and paying monthly rent for four months, he becomes involved in a dispute with his landlord. Kalen, still a minor, moves out and returns the key to the landlord. The landlord wants to hold Kalen liable for the balance of the payments due under the lease. Discuss fully Kalen's liability in this situation.
Answer:
Kalen is not liable to pay the eight months remaining under the lease,
Explanation:
Kalen is not liable to pay the eight months remaining under the lease, since he has legally disaffirmed from the contract by giving the keys back to the landlord. He is not to be bound to the contract. He can disaffirm the contract but remains liable for the value of goods he used (4 months).
The landlord cannot hold him liable for the remaining payment because As a minor Kalen does not have the legal capacity to enter into a contract except in sport or entertainment. Minors are not bestowed civil or political rights because the law says they are too young to handle these responsibilities.
According to the law a contract is valid when both parties have the legal capacity to enter into the contract. Otherwise it is void. Therefore Kalen owes no liability to her landlord
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month.
Cost Formulas
Direct labor $16.20q
Indirect labor $4,300 $1.70q
Utilities $5,600 $0.70q
Supplies $1,400 $0.20q
Equipment depreciation $18,400 $2.90q
Factory rent $8,200
Property taxes $2,700
Factory administration $13,200 $0.80q
The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below.
Actual Cost Incurred in March
Direct labor $ 66,360
Indirect labor $ 10,620
Utilities 8,930
Supplies 2,450
Equipment depreciation $ 30,000
Factory rent 8,600
Property taxes $ 2,700
Factory administration $ 15,796
Required 1:
Prepare the Production Department's planning budget for the month
Required 2:
Prepare the Production Department's flexible budget for the month.
Answer:
A)$148,300
B)$143,800
Explanation:
Production department planning budget :
Budgeted labor hours = 4200
Direct labor $16.20(4200) = $68040
Indirect labor $4,300+$1.70(4200) = $11440
Utilities $5,600+$0.70(4200) = $8540
Supplies $1,400+$0.20(4200) = $2240
Equipment depreciation $18,400+$2.90(4200) = $30580
Factory rent $8,200
Property taxes $2,700
Factory administration $13,200+$0.80(4200) = $16560
Total - $(68040+11440+8540+2240+30580+8200+2700+16560) = $148,300
2.) Flexible budget for the month :
Actual labor hours = 4000
Direct labor $16.20(4000) = $64800
Indirect labor $4,300+$1.70(4000) = $11100
Utilities $5,600+$0.70(4000) = $8400
Supplies $1,400+$0.20(4000) = $2200
Equipment depreciation $18,400+$2.90(4000) = $30000
Factory rent $8,200
Property taxes $2,700
Factory administration $13,200+$0.80(4000) = $16400
Total cost - $(64800+11100+8400+2200+30000+8200+2700+16400) = $143,800
The Freed Corporation produces three products, X, Y, Z, from a single raw material input. Product Y can be sold at the split-off point for total annual revenues of $50,000, or it can be processed further at a total annual cost of $16,000 and then sold for $68,000. Which of the following statements is true concerning Product Y?
a. Product Y should be sold at the split-off point rather than processed further.
b. The annual financial advantage of processing Product Y further is $18,000.
c. The annual financial advantage of processing Product Y further is $68.000.
d. The annual financial advantage from processing Product Y further is $2.000
Answer:
The correct option is D,the annual financial advantage from processing Product Y further is $2.000
Explanation:
The decision of whether or not to further to process product Y is dependent upon the benefit that is derivable from further processing which is computed using the below formula:
benefit/(cost) of further processing=sales value after processing-cost of further processing-sales value at split-off point
sales value after processing is $68,000
additional cost of further processing is $16,000
sales value at split-off point is $50,000
benefit/(cost)=$68,000-$16,000-$50,000=$2,000
161. On July 1 of the current calendar year, Olive Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. Olive follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The adjusting entry on December 31 of the current year for Olive would include:
Answer and Explanation:
The Journal entry is shown below:-
Expenses Dr, $1,875 ($7,500 × 6 ÷ 24)
To Prepaid expenses $1,875
(Being expenses is recorded)
We consider 6 months from July 1 from Dec 31 and we consider 24 months as $7,500 is for 2 years period.
Here we debited the expenses as it increases the expenses and we credited the prepaid expenses as decrease the assets
Income statements for Solomon Company for 2018 and 2019 follow: SOLOMON COMPANY Income Statements 2019 2018 Sales $ 200,600 $ 180,600 Cost of goods sold 143,900 121,900 Selling expenses 21,500 19,500 Administrative expenses 12,300 14,300 Interest expense 3,800 5,800 Total expenses $ 181,500 $ 161,500 Income before taxes 19,100 19,100 Income taxes expense 6,200 3,100 Net income $ 12,900 $ 16,000 Required Perform a horizontal analysis, showing the percentage change in each income statement component between 2018 and 2019. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.
Answer:
Explanation:
In vertical analysis , each item of the income statement is shown as a percentage of sales , while in horizontal analysis , the percentage growth in each item of the income statement from 2018 -2019 is calculated.
Horizontal Analysis
Particulars 2018 2019 % Change
Sales 180,600 200,600 11.07
Cost of goods 121,900 143,900 18.04
Gross profit 58,700 56,700 (3.4)
Selling Exp 19,500 21,500 10.26
Admin Exp 14,300 12,300 (13.97)
Int. Exp 5800 3,800 (34.48)
Total Exp. 161,500 181,500 12.38
PBT 19,100 19,100 0
Income tax 3,100 6,200 100
Net Income 16,000 12,900 (19.38)
Vertical Analysis.
Particulars 2019 % 2018 %
Sales 200,600 100 180,600 100
Cost of Goods 143,900 71.74 121,900 67.50
Gross profit 56,700 28.27 58,700 32.50
Selling Exp. 21,500 10.72 19,500 10.80
Admin Exp. 12,300 6.13 14,300 7.92
Interest Exp 3,800 1.89 5,800 3.21
Total Exp 181,500 90.48 161,500 89.42
PBT 19,100 9.52 19,100 10.58
Income tax 6,200 3.09 3,100 1.71
Net Income 12,900 6.43 16,000 8.86
The declaration, record, and payment dates in connection with a cash dividend of $135,000 on a corporation's common stock are January 12, March 13, and April 12. Journalize the entries required on each date. If no entry is required, select "No Entry Required" and leave the amount boxes blank.
Answer:
Declaration:
Dr retained earnings $135,000
Cr dividends payable $135,000
Record date:
no entries are required
Payment date:
Dr dividends payable $135,000
Cr cash $135,000
Explanation:
The declaration implies that an amount is set aside from retained earnings in order to pay dividends to stockholders,which means that retained earnings is debited with $135,000 while dividends payable is credited with the same amount.
On payment date,the cash account would show a credit,an outflow while dividends payable is debited with $135,000 in order to show that the dividends obligation has been discharged
Lice's Aspirin Inc. produces and packages aspirin for sale to retail stores. Bob buys a bottle of Alice's aspirin at Dahl's Food Stores. Two days later Bob takes two aspirin and within minutes, becomes very ill and is rushed to the hospital, where it is found that a defect in the aspirin caused the reaction. Which of the following is correct?
A. Bob can sue both Alice's Aspirin Inc. and Dahl's because he suffered personal injury due to the defective product.
B. Bob cannot sue anyone because he assumed the risk of taking the aspirin.
C. Bob cannot sue anyone because he is not in privity with Dahl's or Alice's.
D. Bob can sue but will not be able to recover consequential damages for his medical expenses.
Answer:
The correct answer is the option A: Bob can sue both Alice's Aspirin Inc. and Dahl's because he suffered personal injury due to the defective product.
Explanation:
To begin with, the situation that later caused Bob to be injured could have been worse in the case that he may not have gone to the doctor and that is why that he did not just suffered and injury but he also may have had more serious problems or even a situation that could have changed his life forever so therefore that he is able to sue both the store and the company because of the situation that happen to him because of them. In advance, the court will later determinate how much compensation and how the case will go on, but initially he can sue both because of the unpleasent situation that they make him live.
Re-Tire produces bagged mulch made from recycled tires. Production involves shredding tires and packaging the pieces for sale in the bagging department. All direct materials enter in the first process. The following describes production operations for October Direct materials used Direct labor used 30% in Shredding; 70% in Bagging. Predetermined overhead rate (based on direct labor) Transferred to Bagging Transferred to finished goods $234,000 $121,000 165% S205,500 $590,000 The company's revenue for the month totaled $470,000 from credit sales, and its cost of goods sold for the month is $254,000.
Prepare summary journal entries dated October 31 to record its October production activities for
(1) direct materials usage,
(2) direct labor incurred
(3) overhead applied,
(4) goods transfer from Shredding to Bagging,
(5) goods transfer from Bagging to finished goods,
(6) credit sales, and
(7) cost of goods
Answer:
Explanation:
Re-Tire General Journal entries
1.
Dr Work in process - Shredding $234,000
Cr To Raw material Inventory $234,000
2.
Dr Work in process - Shredding $36,300
DrWork in process - bagging $84,700
Cr To Factory Wages $121,000
3.
Dr Work in process - Shredding $59,895
Dr Work in process - bagging $139,755
Cr To Factory Overhead $199,650
4.
Dr Work in process - bagging $205 500
Cr To Work in process - Shredding $205,500
5.
Dr Finished Goods Inventory $590,000
Cr To Work in process - Bagging $590,000
6.
Dr Accounts Receivable $470,000
Cr To Sales Revenue $470,000
7.
Dr Cost of Goods Sold $254,000
Cr To Finished Goods Inventory $254,000
Explanation:
2.
Work in process - Shredding
(121,000*30%) =$36,300
Work in process - bagging
(121,000*70%) =$84,700
To Factory Wages
(84,700+36,300) =121,000
3.
Work in process - Shredding
(36,300*165%)= $59,895
Work in process - bagging
(84,700*165%)= $139,755
To Factory Overhead
(139,755+59,895)=199,650
At the beginning of July, CD City has a balance in inventory of $2,450. The following transactions occur during the month of July.
July 3 Purchase CDs on account from Wholesale Music for $1,350, terms 2/10, n/30.
July 4 Pay cash for freight charges related to the July 3 purchase from Wholesale Music, $110.
July 9 Return incorrectly ordered CDs to Wholesale Music and receive credit, $200.
July 11 Pay Wholesale Music in full. July 12 Sell CDs to customers on account, $3,900, that had a cost of $2,050.
July 15 Receive full payment from customers related to the sale on July 12.
July 18 Purchase CDs on account from Music Supply for $2,150, terms 2/10, n/30.
July 22 Sell CDs to customers for cash, $3,250, that had a cost of $1,550.
July 28 Return CDs to Music Supply and receive credit of $110.
July 30 Pay Music Supply in full.
Required:
a. Assuming that CD City uses a perpetual inventory system, record the transactions. (If no entry is required for a transaction/event, state "No journal entry required".)
b. Prepare the top section of the multiple-step income statement through gross profit for the month of July.
Answer:
CD City
a. Journal Entries, using perpetual inventory system:
July 3:
Debit Inventory $1,350
Credit Accounts Payable (Wholesale Music) $1,350
To record purchase of CDs on account, terms, 2/10, n/30.
July 4:
Debit Freight-in $110
Credit Cash $110
To record cash payment for freight.
July 9:
Debit Accounts Payable (Wholesale Music) $200
Credit Inventory $200
To record return of CDs.
July 11:
Debit Accounts Payable (Wholesale Music) $1,150
Credit Cash Discount $23
Credit Cash $1,127
To record full settlement on account.
July 12:
Debit Accounts Receivable $3,900
Credit Sales $3,900
To record sales of CDs on account.
Debit Cost of Goods Sold $2,050
Credit Inventory $2,050
To record the cost of sales.
July 15:
Debit Cash $3,900
Credit Accounts Receivable $3,900
To record cash receipt from customers.
July 18:
Debit Inventory $2,150
Credit Accounts Payable (Music Supply) $2,150
To record purchase of CDs on account, terms, 2/10, n/30.
July 22:
Debit Cash $3,250
Credit Sales $3,250
To record cash sales.
Debit Cost of Goods Sold $1,550
Credit Inventory $1,550
To record cost of sales.
July 28:
Debit Accounts Payable (Music Supply) $110
Credit Inventory $110
To record return of CDs.
July 30:
Debit Accounts Payable (Music Supply) $2,040
Credit Cash $2,040
To record full settlement.
b. Top Section of Multiple-step Income Statement for the month of July:
Sales $7,150
Cost of Goods Sold = ($3,600)
Gross Profit = $3,550
Explanation:
a) Sales
July 12 = $3,900
July 22 = $3,250
Total $7,150
b) Inventory
Beginning Balance = $2,450
July 3 purchase = 1,350
July 9 return = -200
July 12 cost of sales -2,050
July 18 purchase = 2,150
July 22 cost of sales -1,550
July 28 return = -110
Ending Balance = $2,040
c) Cost of Goods Sold
July 12 cost of sales $2,050
July 22 cost of sales 1,550
Total $3,600
Like many college students, Melanie applied for and got a credit card that has an annual percentage rate (APR) of 12%. The first thing she did was buy a new stereo system for $400. At the end of the month, her credit card statement said she only needed to make a minimum monthly payment of $15. Assume Melanie makes her payment when she sees her statement at the end of each month. If Melanie doesn't charge anything else and only makes the minimum monthly payments, approximately how many months would it take her to completely pay off the stereo system
Answer:
31.17 months
Explanation:
For computing the number of months required to pay off the stereo system we need to apply the NPER formula i.e be shown in the attachment below:
Given that,
Present value = $400
Future value = $0
Rate of interest = 12% ÷ 12 months = 1%
PMT = $15
The formula is shown below:
= NPER(Rate;PMT;-PV;FV;type)
The present value come in negative
So, after applying this, the number of months is 31.17 months
On the basis of the following data taken from the Adjusted Trial Balance columns of the work sheet for the year ended March 31 for Banes Domino's Company. Banes Domino's Company
Adjusted Trial Balance
March 31, 20--
1 Account Title Debit Credit 1
2 Cash 30,000.00
3 Accounts Receivable 45,200.00
4 Supplies 5,000.00
5 Equipment 169,900.00
6 Accumulated Depreciation 32,000.00
7 Accounts Payable 12,500.00
8 Jack Banes, Capital 71,600.00
9 Jack Banes, Drawing 47,000.00
10 Fees Earned 510,000.00
11 Salary Expense 244,500.00
12 Rent Expense 48,000.00
13 Depreciation Expense 25,000.00
14 Supplies Expense 9,500.00
15 Miscellaneous Expense 2,000.00
16 Totals 626,100.00 626,100.00
Required:
Journalize the four closing entries. Refer to the Chart of Accounts for exact wording of account titles. The journal should consist of 12 rows.
Chart of Accounts.
Banes Domino's CorporationGeneral Ledge
Assets
1 Cash
2 Accounts Receivable
3 Supplies
4 Equipment
5 Accumulated Depreciation
Liabilities
5 Accounts Payable
Equity
6 Common Stock
7 Retained Earnings
8 Dividends
9 Income Summary
Revenue
10 Fees Earned
Expenses
11 Salary Expense
12 Rent Expense
13 Depreciation Expense
14 Supplies Expense
15 Miscellaneous Expense
Answer:
Banes Domino's Company
Closing Entries
Date Acct.No Account Debit Credit
9 Income Summary 329,000.00
11 Salary Expense 244,500.00
12 Rent Expense 48,000.00
13 Depreciation Expense 25,000.00
14 Supplies Expense 9,500.00
15 Miscellaneous Expense 2,000.00
Expenses are closed to Income Summary Account.
10 Fees Earned 510,000.00
9 Income Summary 510,000.00
Revenue Accounts are closed to Income Summary Account.
9 Income Summary 181,000.00
Jack Banes, Capital 181,000.00
To close Income Summary Account
Jack Banes, Capital 47,000.00
Jack Banes, Drawing 47,000.00
To Close withdrawals account.
A book on how to invest in collectibles spends several weeks on best seller lists. The paperback book was originally released for $9.99. A reduction of the price to $9.79 had little effect total revenue, which remained the same. This is due to the book having:
Answer:
inelastic demand
Explanation:
Price elasticity of demand (PED) measures the proportional change in quantity demanded when the price of a product or service changes:
when a 1% decrease in price, increases quantity demanded in a smaller proportion, the PED is said to be inelastic.when a 1% decrease in price, increases quantity demanded in a larger proportion, the PED is said to be elastic.when a 1% decrease in price, increases quantity demanded in the same proportion, the PED is said to be unit elastic.In this case, the decrease in price (-2%) barely increased the quantity demanded, therefore, the PED is inelastic.
A guitar manufacturer is considering eliminating its electric guitar division because its $76,000 expenses are higher than its $72,000 sales. The company reports the following expenses for this division.
Avoidable Expenses Unavoidable Expenses
Cost of goods sold $56,000
Direct expenses 9,250 $1,250
Indirect expenses 470 1,600
Service department costs 6,000 1,430
Should the division be eliminated?
Answer:
If the Division is eliminated, income will decrease by $280
Explanation:
Giving the following information:
Sales= $72,000
Expenses= $76,000 sales.
Avoidable Expenses - Unavoidable Expenses
Cost of goods sold: $56,000
Direct expenses: 9,250 - $1,250
Indirect expenses: 470 - 1,600
Service department costs: 6,000 - 1,430
We need to determine if eliminating the Division will increase income.
Current loss= $4,000
Effect on income= unavoidable costs - current loss
Effect on income= -(1,250 + 1,600 + 1,430) + 4,000
Effect on income= $280 decrease
A teenage boy has opened a checking account. He is surprised to find that though he is getting a written bank statement each month he is not getting his canceled checks returned. The teenager should be aware that the reason canceled checks are NOT returned is to *
Answer:
Save the bank money associated with returning copies of these checks.
Explanation:
The correct answer to this question is Save the bank money associated with returning copies of these checks. Because as you can see the teenage boy has opened a checking account and he is surprised So we already know the answer.
Answer: Save the bank money associated with returning copies of these checks
Hope this helps.
Midland Company buys tiles and prints different designs on them for souvenir and gift stores. It buys the tiles from a small company in Europe, so at all times it keeps on hand a stock equal to the tiles needed for three months’ sales. The tiles cost $0.75 each and must be paid for in cash. The company has 28,000 tiles in stock. Sales estimates, based on contracts received, are as follows for the next six months: January 13,300 February 18,700 March 13,700 April 15,100 May 8,900 June 7,800
Required: a. & b. Estimate purchases (in units) and cash required to make purchases in January, February, and March.
Answer:
January
purchases = 32,800 units
required cash to pay for purchases = $24,600
February
purchases = 8,900 units
required cash to pay for purchases = $6,675
March
purchases = 7,800 units
required cash to pay for purchases = $5,850
Explanation:
each tile costs $0.75, paid in cash, three month stock
28,000 tiles in stock
estimated sales:
January 13,300 February 18,700 March 13,700 April 15,100 May 8,900 June 7,800January
beginning inventory January 28,000
estimated sales 13,300
desired ending inventory = sales for next three months = 18,700 + 13,700 + 15,100 = 47,500
purchases = 47,500 + 13,300 - 28,000 = 32,800
required cash to pay for purchases = 32,800 x $075 = $24,600
February
beginning inventory January 47,500
estimated sales 18,700
desired ending inventory = sales for next three months = 13,700 + 15,100 + 8,900 = 37,700
purchases = 37,700 + 18,700 - 47,500 = 8,900
required cash to pay for purchases = 8,900 x $075 = $6,675
March
beginning inventory January 37,700
estimated sales 13,700
desired ending inventory = sales for next three months = 15,100 + 8,900 + 7,800 = 31,800
purchases = 31,800 + 13,700 - 37,700 = 7,800
required cash to pay for purchases = 7,800 x $075 = $5,850
g Productive efficiency refers to Multiple Choice the use of the least-cost method of production. the production of the product mix most wanted by society. the full employment of all available resources. production at some point inside of the production possibilities curve.
Answer: The full employment of all available resources.
Explanation:
When a company is said to be Productively Efficient, it means that they are employing all available resources and no resource is being wasted.
Therefore at this level, were they to produce more of a good, they would have to reduce the resources going to another good. At this point there is no wastage whatsoever and resources are being used efficiently.