Answer and Explanation:
1. According to the scenario, the journal entries are shown below:
Journal Entry
October 1 Cash A/c Dr. $40,000
To Common stock A/c $40,000
(Being the exchange for the common stock is recorded)
October 2 Rent expenses A/c Dr. $4,800
To Cash A/c $4,800
(Being the paid rent on office and equipment is recorded)
October 3 Supplies A/c Dr. $2,150
To Accounts payable A/c $2,150
(Being the purchase of supplies is recorded)
October 4 Accounts payable A/c Dr. $1,100
To Cash A/c $1,100
(Being the cash paid is recorded)
October 5 Cash A/c Dr. $18,750
To Sales commission A/c $18,750
(Being the earned sales commission is recorded)
October 6 Automobile expense A/c Dr. $1,580
Miscellaneous expense A/c Dr. $800
To Cash A/c $2,380
(Being the automobile and miscellaneous expenses paid is recorded)
October 7 Office salaries expense A/c Dr. $3,500
To Cash A/c $3,500
(Being the office salaries paid is recorded)
October 8 Supplies expense A/c Dr. $1,300
To Supplies A/c $1,300
(Being the cost of supplies is recorded)
October 9 Dividend A/c Dr. $1,500
To Cash A/c $1,500
(Being the dividend paid is recorded)
2. Now the posting of various accounts are as follows
T Accounts
Cash A/c
Particular Amount ($) Particular Amount ($)
Common stock 40,000 Rent expenses 4,800
Sales commission 18,750 Account payable 1,100
Automobile expense 1,580
Miscellaneous expense 800
Office salaries expense 3,500
Dividend expense 1,500
Supplies Account
Particular Amount ($) Particular Amount ($)
Accounts payable 2,150 Supplies expenses 1,300
Accounts Payable
Particular Amount ($) Particular Amount ($)
Cash 1,100 Supplies 2,150
Common Stock
Particular Amount ($) Particular Amount ($)
Cash 40,000
Dividends
Particular Amount ($) Particular Amount ($)
Cash 1,500
Sales Commission
Particular Amount ($) Particular Amount ($)
Cash 18,750
Rent expense
Particular Amount ($) Particular Amount ($)
Cash 4,800
Office Salaries expense
Particular Amount ($) Particular Amount ($)
Cash 3,500
Supplies Expenses
Particular Amount ($) Particular Amount ($)
Supplies 1,300
Automobile Expense
Particular Amount ($) Particular Amount ($)
Cash 1,580
Miscellaneous expense
Particular Amount ($) Particular Amount ($)
Cash 800
3. Now unadjusted trail balance is presented below:
Unadjusted Trial Balance
Particular Debit Amount ($) Particular Credit Amount ($)
Cash 45,470 Accounts payable 1,050
Supplies 850 Common stock 40,000
Dividends 1,500 Sales Commission 18,750
Rent expense 4,800
Office salaries expense 3,500
Automobile expense 1,580
Supplies expense 1,300
Miscellaneous expense 800
Total 59,800 Total 59,800
4
a).Amount of total revenue recorded in the ledger
Sales commissions = $18,750
b). Amount of total expenses recorded in the ledger
Particular Amount ($)
Rent expense 4,800
Office salaries expense 3,500
Automobile expense 1,580
Supplies expense 1,300
Miscellaneous expense 800
Amount of total expenses
recorded in the ledger 11,980
c).Amount of Net income for October is
= Total Revenue - Total Expenses
= $18,750 - $11,980
= $6,770
d) Increase or decrease in retained earnings for October is
= Net Income - Dividends
= $6,770 - $1,500
= $5,270
All assets, expenses and dividend contains normal debit balance while the liabilities, revenues, and the stockholder equity contains normal credit balance
Ali Co. uses a sales journal, purchases journal ,Cash receipts journal,Company uses a sales journal, purchases journal, cash receipts journal, cash payments journal, and general journal. Journalize the following transactions that should be recorded in the cash receipts journal.
May 1 C. Li, the owner, contributed $12,000 cash to the company.
7 The company purchased $8,000 of merchandise on credit from Gomez, terms n/30.
9 The company sold merchandise costing $1,150 on credit to E. James for $1,250, terms n/10.
15 The company borrowed $8,500 cash by signing a note payable to the bank.
18 The company received $1,250 cash from E. James in payment of the May 9 purchase.
24 The company sold merchandise costing $900 to B. Cox for $950 cash.
Journalize the November transactions that should be recorded in the cash receipts journal assuming the perpetual inventory system is used.
Answer:
Only those transactions that involve cash payments or cash receipts are recorded in the cash journal:
May 1, C. Li contributes cash tot he company
Dr Cash 12,000
Cr C. Li., capital 12,000
May 15, cash received from bank loan
Dr Cash 8,500
Cr Notes payable 8,500
May 18, collections from E. James
Dr Cash 1,250
Cr Accounts receivable 1,250
May 24, merchandise sold to B. Cox
Dr Cash 950
Cr Sales revenue 950
Dr Cost of goods sold 900
Cr Inventory 900
The May 7 and May 9 transactions should be recorded in the sales journal but not in the cash journal since they involve accounts receivables. COGS from May 24 transaction should also be recorded in the cash journal because the sales were on cash.
Blue Company uses special strapping equipment in its packaging business. The equipment was purchased in January 2019 for $12,200,000 and had an estimated useful life of 8 years with no salvage value. At December 31, 2020, new technology was introduced that would accelerate the obsolescence of Blue’s equipment. Blue’s controller estimates that expected future net cash flows on the equipment will be $7,686,000 and that the fair value of the equipment is $6,832,000. Blue intends to continue using the equipment, but it is estimated that the remaining useful life is 4 years. Blue uses straight-line depreciation.
(a) Prepare the journal entry (if any) to record the impairment at December 31, 2020.
(b) Prepare the journal entry for the equipment at December 31, 2021.
Answer:
Journal Entry - Impairment
Debit : Impairment Loss, $854,000
Credit: Accumulated Impairment Loss, $854,000
Journal entry - Depreciation
Debit : Depreciation expense, $2,135,000
Credit : Accumulated Depreciation, $2,135,000
Explanation:
Impairment loss is the excess of the Carrying Amount of an Asset over its Recoverable Amount.
Carrying Amount
Carrying Amount = Cost - Accumulated Depreciation
Depreciation Calculation (Straight line) : (Cost - Salvage Value) / Number of Useful life
2019 = ($12,200,000 - $0) / 8
= $1,525,000
2020 = $12,200,000 - $1,525,000 / 5
= $2,135,000
Note the change in useful life is applied from beginning of the year hence (4+1) years.Also the adjustment is only made in 2019 not retrospectively.
Carrying Amount = $12,200,000 - $1,525,000 - $2,135,000
= $ 8,540,000
Recoverable Amount
Is the higher of :
Fair Value less Cost to sell : $6,832,000 or,Value in use : $7,686,000Therefore Recoverable amount is $7,686,000
Impairment test
Carrying Amount : $ 8,540,000 > Recoverable amount : $7,686,000
The equipment is impaired.
Impairment loss is $ 8,540,000 - $7,686,000 = $854,000
Journal Entry - Impairment
Debit : Impairment Loss, $854,000
Credit: Accumulated Impairment Loss, $854,000
Journal entry - Depreciation
Debit : Depreciation expense, $2,135,000
Credit : Accumulated Depreciation, $2,135,000
Suppose you have a choice of two equally risky annuities, each paying $1,000 per year for 20 years with similar interest rates. One is an annuity due, while the other is an ordinary annuity. Which annuity would you choose
Answer:
Annuity due would be be chosen.
Explanation:
Let us assume the similar annual interest rate is 10%.
To decide which to choose, the present values of the two annuities are calculated and compared as follows:
1. For annuity due
Under an annuity due, payments are made to investors at the beginning of each time period. The present value of an annuity due can be calculated as follows:
PVd = P × [{1 - [1 ÷ (1+r)]^n} ÷ r] × (1+r) .................. (1)
Where;
PVd = Present value of an annuity due = ?
P = Annual payment = $1,000
r = interest rate = 10%, or 0.10
n = number of years = 20
Substituting the values into equation (1) above, we have:
PVd = $1,000 × [{1 - [1 ÷ (1 + 0.10)]^20} ÷ 0.10] × (1 + 0.10) = $9,364.92
2. For ordinary annuity
Under an ordinary annuity, payments are made to investors at the end of each time period. The present value of an ordinary annuity can be calculated as follows:
PVd = P × [{1 - [1 ÷ (1+r)]^n} ÷ r] .................. (2)
Where
PVo = Present value of an ordinary annuity = ?
P = Annual payment = $1,000
r = interest rate = 10%, or 0.10
n = number of years = 20
Substituting the values into equation (1) above, we have:
PVo = $1,000 × [{1 - [1 ÷ (1 + 0.10)]^20} ÷ 0.10] = $8,513.56
3. Decision
Since the present value (PV) of the annuity due of $9,364.92 is greater than the PV of ordinary annuity of $8,513.56, annuity due would be be chosen.
Calculate Payroll
An employee earns $30 per hour and 1.5 times that rate for all hours in excess of 40 hours per week. If the employee worked 54 hours during the week. Assume that the social security tax rate is 6.0%, the Medicare tax rate is 1.5%, and the employe's federal income tax withheld is $295.
a. Determine the employe's gross pay for the week.
b. Determine the employee's net pay for the week. Round your answer to two decimal places.
Answer:
A.1830
B.$1397.75
Explanation:
A.Gross pay
Formula for Gross pay
Gross pay = regular pay + overtime pay
= (40*30)+(14*30*1.5)
=1200+630
= $1830
Part B
B.Net pay
Formula for Net pay
Net pay = gross pay – social security tax – medicare tax – federal income tax
= 1830-(1830*6.0%)-(1830*1.5%)-295
=1830-109.8-27.45-295
= $1397.75
YadaYada expects to produce 1 comma 9501,950 units in JanuaryJanuary and 2 comma 1702,170 units in FebruaryFebruary. The company budgets 22 pounds per unit of direct materials at a cost of $ 50$50 per pound. Indirect materials are insignificant and not considered for budgeting purposes. The balance in the Raw Materials Inventory account (all direct materials) on JanuaryJanuary 1 is 5 comma 6005,600 pounds. YadaYada desires the ending balance in Raw Materials Inventory to be 8080% of the next month's direct materials needed for production. Desired ending balance for FebruaryFebruary is 4 comma 1004,100 pounds. Prepare YadaYada's direct materials budget for JanuaryJanuary and FebruaryFebruary.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Production:
January= 1,950 units
February= 2,170 units
The company budgets 2 pounds per unit of direct materials for $50 per pound.
Beginning inventory= 5,600 pounds.
Yada desires the ending balance in Raw Materials Inventory to be 80% of the next month's direct materials needed for production. Desired ending balance for February is 4,100 pounds.
We need to use the following formula structure:
Direct material budget= production + desired ending inventory - beginning inventory
Direct material budget January (in pounds):
Production= 1,950*2= 3,900
Desired ending inventory= (2,170*2)*0.8= 3,472
Beginning inventory= (5,600)
Total= 1,772
Total cost= 1,772*50= $88,600
Direct material budget February (in pounds):
Production= 2,170*2= 4,340
Desired ending inventory= 4,100
Beginning inventory= (3,472)
Total= 4,968
Total cost= 4,968*50= $248,400
Report Assessment: Givens Graphics Company was organized on January 1, 2010, by Sue Givens. At the end of the first 6 months of operations, the trial balance: Cash $ 9,500; Accounts Receivable 14,000; Equipment 45,000; Insurance Expense 1,800; Salaries Expense 30,000; Supplies Expense 3,700; Advertising Expense 1,900; Rent Expense 1,500; Utilities Expense 1,700; Notes Payable $ 20,000; Accounts Payable 9,000; Sue Givens, Capital 22,000; Graphic Revenue 52,100; Consulting Revenue 6,000. Analysis reveals the following additional data. 1. The $3,700 balance in Supplies Expense represents supplies purchased in January.At June 30, S1,300 of supplies was on hand. 2. The note payable was issued on February 1. It is a 9%, 6-month note. 3. The balance in Insurance Expense is the premium on a one-year policy, dated March 1,2010. 4. Consulting fees are credited to revenue when received. At June 30, consulting fees of $1,500 are unearned. 5. Graphic revenue earned but unrecorded at June 30 totals $2,000. 6. Depreciation is S2,000 per year. Instructions (a) Journalize the adustino entries at une 30. 5. Graphic revenue earned but unrecorded at June 30 totals $2,000. 6. Depreciation is $2,000 per year. Instructions (a) Journalize the adjusting entries at June 30. (Assume adjustments are recorded every 6 months.) (b) Prepare an adjusted trial balance. (c) Prepare an income statement and owner's equity statement for the 6 months ended June 30 and a balance sheet at June 30. Case Study Assement: PIONEER ADVERTISING was organized in 2010.The company prepares financial statements. The adjusted trial balance amounts at Dec.31 2010 are shown below. Cash S15,200 Accounts receivable 200 Supplies 1,000 Prepaid insurance 550 Equipment $5,000 Accumulated depreciation equipment 40 Notes payable $5,000 Accounts payable 2,500
Answer:
Givens Graphics Company
(a) Journalize the adjusting entries at June 30. (Assume adjustments are recorded every 6 months.):
1. Debit Supplies Expense $2,400
Credit Supplies $2,400
To accrue supplies used to date.
2. Debit Interest Expense $750
Credit Interest Payable $750
To accrue interest due.
3. Debit Insurance Expense $600
Credit Insurance Prepaid $600
To accrue the insurance expense for 4 months.
4. Debit Consulting Fees (Unearned) $4,500
Credit Consulting Fees Earned $4,500
To accrue earned consulting fees.
5. Debit Accounts Receivable $2,000
Credit Graphic Revenue Earned $2,000
To accrued earned revenue.
6. Debit Depreciation Expense $1,000
Credit Accumulated Depreciation $1,000
To record depreciation charge for six months.
(b) Adjusted trial balance:
Cash $ 9,500
Accounts Receivable 16,000
Equipment 45,000
Insurance Expense 600
Insurance Prepaid 1,200
Salaries Expense 30,000
Supplies Expense 2,400
Supplies 1,300
Advertising Expense 1,900
Rent Expense 1,500
Utilities Expense 1,700
Notes Payable $ 20,000
Interest Expense 750
Interest Payable 750
Depreciation Expense 1,000
Accumulated Depreciation 1,000
Accounts Payable 9,000
Sue Givens, Capital 22,000
Graphic Revenue 54,100
Unearned Consulting Revenue 1,500
Consulting Revenue 4,500
Total $112,850 $112,850
(ci) Income statement for the 6 months ended June 30:
Graphic Revenue $54,100
Consulting Revenue 4,500
Total Revenue $58,600
Less Expenses:
Insurance Expense 600
Salaries Expense 30,000
Supplies Expense 2,400
Advertising Expense 1,900
Rent Expense 1,500
Utilities Expense 1,700
Interest Expense 750
Depreciation Expense 1,000 $39,850
Net Income $18,750
(cii) Owner's equity statement for the 6 months ended June 30:
Sue Givens, Capital $22,000
Retained Earnings 18,750
Total Equity $40,750
(ciii) Balance sheet at June 30:
Assets:
Cash $ 9,500
Accounts Receivable 16,000
Insurance Prepaid 1,200
Supplies 1,300
Equipment 45,000
Total Assets $73,000
Liabilities + Equity:
Notes Payable $ 20,000
Interest Payable 750
Accumulated Depreciation 1,000
Accounts Payable 9,000
Unearned Consulting Revenue 1,500
Sue Givens, Capital 22,000
Retained Earnings 18,750
Total Liabilities + Equity $73,000
Explanation:
a) Unadjusted Trial Balance at June 30:
Cash $ 9,500
Accounts Receivable 14,000
Equipment 45,000
Insurance Expense 1,800
Salaries Expense 30,000
Supplies Expense 3,700
Advertising Expense 1,900
Rent Expense 1,500
Utilities Expense 1,700
Notes Payable $ 20,000
Accounts Payable 9,000
Sue Givens, Capital 22,000
Graphic Revenue 52,100
Consulting Revenue 6,000
Total $109,100 $109,100
b) Adjusting Journal Entries are end of period adjustments (accrued expenses and revenue, unearned revenue and prepaid expenses, and depreciation charges) made to the accounts to match them to the accrual basis of generally accepted accounting principles.
The financial statements are the statements that reflect the status of the company regarding the growth and the financial structure of the company. It relies upon the market condition as well as the survival and growth of the company.
The answer to all the parts has been attached below.
To know more about the journal entries of the questions, refer to the link below:
https://brainly.com/question/18761922
Which of the following sentences use apostrophes correctly? 1. We used to back up our account files weekly and save them onto CD’s. 2 .The financial planner’s e-mail address was listed on his website. 3. Him recording's every conversation made his coworkers suspicious. 4. Making certain that all the timecards were submitted on time was Lorice’s responsibility.
Answer:
2. The financial planner’s e-mail address was listed on his website.
4. Making certain that all the timecards were submitted on time was Lorice’s responsibility.
Explanation:
The apostrophe (') is a punctuation mark used in English language to form possessive nouns, mark the omission of one or more letters and to indicate the plurals of letters in lowercases.
For example, forming a possessive noun; add an Apostrophe (') with the letter "s" i.e ('s) to nouns that don't end with "s" sound. Also, you can add only an Apostrophe (') without the letter "s" to nouns that ends with "s" sound.
For instance, the financial planner’s e-mail address was listed on his website, the writer's pen, the cat's eyeballs etc.
To indicate the omission of a letter (contraction), such as isn't, don't they're, I've, you're, doesn't, you've, they'd etc.
A market for the trading of assets is established by individuals buying and selling shares from inventory. These individuals stay in business by earning a commission equal to the difference between the price the buyer of the shares pays and the price the seller of the shares receives. What do we call this type of market
Answer:
Dealer market
Explanation:
The reason is that the person who mediates between the seller and the buyer is the called dealer and this person never owns the asset, what he does is that he mediates between two parties to increase the chance of purchase at a reasonable price and by doing so he earns commission. Such a market is known as dealer market.
On January 1, 2017, Tri-State Industries had cash and common stock of $180,000. At that date the company had no other asset, liability or equity balances. On January 2, 2017, it purchased $160,000 of equity securities for cash that it classified as available-for-sale. It received cash dividends of $12,000 during the year on these securities. In addition, it had an unrealized holding gain on these securities of $32,000 net of tax. Based on this information, what is the amount of comprehensive income in 2017
Answer:
$44,000
Explanation:
Tri-State Industries
Comprehensive income can be defined as the income which tend to include holding gain or loss that are yet to be realized.
Unrealized holding gain on securities $32,000
Add Cash dividend received $12,000
Comprehensive income $44,000
Therefore the amount of comprehensive income in 2017 will be $44,000
On August 1, 2019, Pereira Corporation has sold 1,600 Wiglows to Mendez Company at $450 each. Mendez also purchased a 1-year service-type warranty on all the Wiglows for $12 per unit. In 2019, Pereira incurred warranty costs of $9,200. Costs for 2020 were $7,000. Required: 1. Prepare the journal entries for the preceding transactions. 2. Show how Pereira would report the items on the December 31, 2019, balance sheet.
Answer: Please refer to Explanation
Explanation:
1.
August 1,2019
DR Accounts Receivable - Mendez Company $739,200
CR Sales $720,000
CR Unearned Warranty Revenue $19,200
(To record Sales on Account to Mendez Company)
Dec 31, 2019
DR Warranty expense $9,200.00
CR Cash $9,200.00
(To record Warranty Expense incurred)
Dec 31, 2019
DR Unearned warranty revenue $8,000.00
CR Warranty revenue $8,000.00
(To record Warranty Revenue Earned)
Dec 31, 2020
DR Warranty expense $7,000.00
CR Cash $7,000.00
(To record Warranty Expense Incurred)
Dec 31 2020
DR Unearned warranty revenue $11,200.00
CR Warranty revenue $11,200.00
(To record Warranty Revenue Earned)
Workings
Sales
=1,600 wiglows * $450
= $720,000
Unearned Warranty Revenue - this is the amount that Mendez paid for a one year service-type warranty.
= 1,600 * 12
= $19,200
Warranty Revenue for 2019.
The warranty was for a year but only 5 months have passed at year's end since August 1 so the 5 months will be apportioned to enable it to be recorded for 2019, the total Unearned Warranty Revenue received will be apportioned as such,
= 5/12 * 19,200
= $8,000.
So $8,000 will be considered as earned for the year 2019.
Warranty Revenue 2020.
The rest of the Warranty will be recorded and earned in 2020.
= 19,200 - 8,000 (amount for 2019)
= $11,200
b)
The Unearned Warranty Revenue remaining will be reported as a Current liability as the period of a Year has not expired and so it cannot be considered as earned.
Dec 31 2019
Partial Balance Sheet.
Current Liabilities
Unearned warranty revenue $11,200.00
Answer:
1. Prepare the journal entries for the preceding transactions.
August 1, 2019, sale of 1,600 Wiglows
Dr Cash 720,000
Cr Sales revenue 720,000
August 1, 2019, sale of 1,600 service type-warranties on Wiglows
Dr Cash 19,200
Cr Deferred warranty revenue 19,200
December 31, 2019, accrued warranty expense
Dr Deferred warranty revenue 9,200
Cr Cash 9,200
December 31, 2019, recognition of warranty expense for 2020
Dr Deferred warranty revenue 7,000
Cr Warranty liability 7,000
December 31, 2019, recognition of warranty revenue
Dr Deferred warranty revenue 3,000
Cr Warranty revenue 3,000
2. Show how Pereira would report the items on the December 31, 2019, balance sheet.
Cash account will increase current assets by $730,000.
We do not know the COGS, so we do not know exactly by how much will inventory decrease.
Warranty liability will increase current liabilities by $7,000.
Warranty revenue will increase retained earnings by $3,000. Since the warranty period expires during 2020, and the costs incurred are estimated to be $7,000, then we can recognize the remaining deferred warranty revenue as earned warranty revenue.
Record transactions related to accounts receivable (LO5-3, 5-4, 5-5).The following information applies to the questions.The following events occur for The Underwood Corporation during 2021 and 2022, its first two years of operations. June 12, 2021 Provide services to customers on account for $41,000. September 17, 2021 Receive $25,000 from customers on account. December 31, 2021 Estimate that 45% of accounts receivable at the end of the year will not be received. March 4, 2022 Provide services to customers on account for $56,000. May 20, 2022 Receive $10,000 from customers for services provided in 2021. July 2, 2022 Write off the remaining amounts owed from services provided in 2021. October 19, 2022 Receive $45,000 from customers for services provided in 2022. December 31, 2022 Estimate that 45% of accounts receivable at the end of the year will not be received.Calculate the net realizable value of accounts receivable at th endof 2018 and 2019. 2018 2019Total accounts receivable Less: Allowance for uncollectible accounts Net realizable value
Answer:
The Underwood Corporation
Journal Entries
June 12, 2021:
Debit Accounts Receivable $41,000
Credit Service Revenue $41,000
To record provision of services to customers on account
Sept 17, 2021:
Debit Cash Account $25,000
Credit Accounts Receivable $25,000
To record cash receipt from customers
Dec. 31, 2021:
Debit Uncollectible Expense $7,200
Credit Allowance for Doubtful Accounts $7,200
To record allowance for doubtful accounts.
March 4, 2022:
Debit Accounts Receivable $56,000
Credit Service Revenue $56,000
To record provision of services to customers on account.
May 20, 2022:
Debit Cash Account $10,000
Credit Accounts Receivable $10,000
To record cash receipts from customers.
July 2, 2022:
Debit Allowance for Doubtful Accounts $6,000
Credit Accounts Receivable $6,000
To record write-off of uncollectibles.
Oct. 19, 2022:
Debit Cash Account $45,000
Credit Accounts Receivable $45,000
To record cash receipts from customers.
Dec. 31, 2022:
Debit Uncollectible Expense $3,750
Credit Allowance for Doubtful Accounts $3,750
To bring the allowance for doubtful accounts to $4,950
b) Calculation of Net Realizable Value of Accounts Receivable:
2021 2022
Accounts Receivable $16,000 $11,000
Less: Allowance for Uncollectible Accounts $7,200 $4,950
Net Realizable Value $8,800 $6,050
Explanation:
a) Services provided to customers on account increase the accounts receivable and the Service Revenue accounts by the same amount.
b) Cash Receipts from customers on account decrease the accounts receivable and increase the Cash Account by the same amount.
c) Allowance for Uncollectible (Doubtful) is a provision made to cover the risk of credit sales. The account is a contra account to the Accounts Receivable and is increased or reduced accordingly depending on the estimated allowance. Write-off of debts deemed uncollectible is done in this account.
d) The net realizable value of accounts receivable is the balance of accounts receivable less the allowance for uncollectible at the end of the period.
Suppose we can divide all the goods produced by an economy into two types: consumption goods and capital goods. Capital goods,such as machinery, equipment, and computers, are goods used to produce other goods.
Required:
a. Use a production possibilities frontier graph to illustrate the trade-off to an economy between producing consumption goods and producing capital goods. Is it likely that the production possibilities frontier in this situation would be a straight line oe concave? Briefly explain.
b. Suppose the technological advance occurs that affects the production of capital goods but not consumption goods. Show the effect on the production possibilities frontier.
Answer: The answer is provided below
Explanation:
a. A production possibility frontier graph is used to show the various combinations of two goods which are the consumption and the capital goods that can be produced while efficiently utilizing the resources that are available in an economy.
The production possibility frontier will be concave. This is because of the increasing marginal opportunity cost. It means that to produce one more unit of capital goods, part of the consumption goods will be sacrificed and vice versa due to limited resources.
b. The diagram has been attached. The effect is that the production possibility frontier will shift upward and there will be more capital goods with the available resources.
The diagram for a and b has been attached.
Frank purchased land containing oil reserves for $425,000. He has calculated his cost depletion for the year to be $20 per barrel for a total of $120,000 in depletion expense. He now needs to calculate his percentage depletion in case it is larger. His gross income from the oil extraction is $600,000 and he has $520,000 in operating expenses before depletion expense. Assuming this is domestic production, the amount of percentage depletion expense is $______1 of 3. If he uses this method he can deduct $________2 of 3 for tax purposes. He should use the______3 of 3 depletion method to maximize his deduction.
Answer:
1 of 3. $52,000
2 of 3. $68,000
3 of 3 Percentage depletion
Explanation:
The percentage depletion rate = 15% of gross income and limited to 65% of the net income
The gross income = $600,000
The operating expense = $520,000
The net income = $600,000 - $520,000 = $80,000
Therefore at 15% gross income, we have;
Percentage depletion rate = $600,000 × 0.15 = $90,000
65% of the net income gives;
$80,000 × 0.65 = $52,000
1 of 3. Therefore since 15% of the gross income ($90,000) > 65% of the net income($52,000), we have
The percentage depletion rate = $52,000
2 of 3. Therefore, he can deduct $120,000 - $52,000 = $68,000
3 of 3 He should therefore use the percentage depletion method to maximize his deductions
We therefore have;
Assuming this is domestic production, the amount of percentage depletion expense is _$52,000_. If he uses this method he can deduct _$68,000_ for tax purposes. He should use the _percentage depletion_ method to maximize his deductions.
X-treme Vitamin Company is considering two investments, both of which cost $22,000. The cash flows are as follows:
Year Project A Project B
1 $25,000 $22,000
2 12,000 11,000
3 8,000 14,000
Calculate the payback period for Project A and Project B.
Answer:
0.88 years
1 year
Explanation:
Payback period calculates the amount of the time it takes to recover the amount invested in a project from its cumulative cash flows.
For project A:
Amount invested = $-22,000
Amount recovered in year 1 = $-22,000 + $25,000 =$-3000
The amount invested is recovered In 22,000 / $25,000 = 0.88 years
For project B:
Amount invested = $-22,000
Amount recovered in year 1 = $-22,000 + $22,000 = 0
The amount invested is recovered in a year
I hope my answer helps you
6. Trade deficit and the currency depreciation Which approach to the relationship between exchange rates and the trade balance predicts that a currency depreciation will improve a nation’s trade balance if that nation’s output exceeds the sum of consumption, investment, and government expenditures? The elasticity approach The absorption approach The monetary approac
Answer:
The absorption approach
Explanation:
The absorption approach with respect to the balance of payments derives that a balance of trade of a country will only better if the output of the company in terms of goods and services rises by more than its absorption or utilization
Here, the absorption refers to incurred expenditure by the residents who are domestic on the goods and services.
Hence, according to the given situation, the appropriate option is absorption approach
Utilities $16,400 plus $0.14 per machine-hour $ 20,440 Maintenance $39,000 plus $1.60 per machine-hour $ 58,400 Supplies $0.30 per machine-hour $ 4,600 Indirect labor $94,600 plus $1.10 per machine-hour $ 113,100 Depreciation $68,500 $ 70,200 During March, the company worked 14,000 machine-hours and produced 8,000 units. The company had originally planned to work 16,000 machine-hours during March.Complete the report showing the activity variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)Complete the report showing the spending variances for March. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Answer and Explanation:
a. The Preparation of activity variances for March is presented below:-
Activity variances for March
Particulars Planning Budget Flexible Budget Activity Variances
Machine
hours 16,000 14,000
Utilities $18,640 $18,360 $280 F av.
For Planning budget
($16,400 + ($0.14 × 16,000)) ($16,400 + ($0.14 × 14,000))
Maintenance $64,600 $61,400 $3,200 Fav.
($39,000 + ($1.60 × 16,000)) ($39,000 + ($1.60 × 14,000))
Supplies $4,800 $4,200 $600 Fav.
($0.30 × 16,000) ($0.30 × 14,000)
Indirect labor $112,200 $110,000 $2,200 Fav.
($94,600 + ($1.10 × 16,000) ($94,600 + ($1.10 × 14,000))
Depreciation $68,500 $68,500 0
Total $284,740 $276,460 $8,280 Fav.
b. The Preparation of spending variances for March is presented below:-
Spending variances for March
Particulars Flexible Budget Actual Difference
Machine
Hours $14,000 $14,000
Utilities $18,360 $20,440 $2,080 Unfav.
($16,400 + ($0.14 × 14,000))
Maintenance $61,400 $58,400 $3,000 Fav.
($39,000 + ($1.60 × 14,000))
Supplies $4,200 $4,600 $400 U nfav.
($0.30 × 14,000)
Indirect labor $110,000 $113,100 $3,100 Unfav.
($94,600 + ($1.10 × 14,000)
Depreciation $68,500 $70,200 $1,700 Unfav.
Total $276,460 $280,740 $4,280 Unfav.
For reaching the total we added all the expenses in both spending variance and activity variance.
Most international business messages tend to be written in an informal, conversational manner. should be written following generally accepted principles for writing American business letters. use active-voice constructions. should conform to the conventions of the receiver's country.
Answer:
should conform to the conventions of the receiver's country
Explanation:
The more an international business adapts its operations to the specific culture of the countries where it operates, the more likely it is that it will succeed, since customers are very sensitive to their own culture, and lacking this understanding can result in ineffective communication, and less sales.
For this reason, interantional business messages should conform to the conventions of the receiver's country: like this, people in the receiver country will not only understand the message clearly, but will also feel identified with it, raising their level of trust in the company.
Indicate the effect on the accounting equation and on the debit-credit analysis. Aug. 1 Opens an office as a financial advisor, investing $8,000 in cash. 4 Pays insurance in advance for 6 months, $1,800 cash. 16 Receives $3,600 from clients for services performed. 27 Pays secretary $1,000 salary.
Answer: Please refer to Explanation
Explanation:
A. Aug. 1 Opens an office as a financial advisor, investing $8,000 in cash.
This is an investment by the owner so the following will happen.
The Cash account will INCREASE by $8,000
The Owner's Equity Account will INCREASE by $8,000 as well.
Cash is an Asset and when it INCREASES you DEBIT it. So DEBIT Cash by $8,000.
Owners Equity is an Equity Account and when INCREASED you CREDIT it. So Credit Cash by $8,000.
B. 4 Pays insurance in advance for 6 months, $1,800 cash.
This is a Prepaid Expense which means that it is an Asset because it represents that we are owed for service.
The Prepaid Insurance Account will Increase
The Cash Account will Decrease as the money from paid from it.
Prepaid Expense is an Asset which INCREASED so DEBIT it by $1,800.
Cash is an Asset as well and when Assets DECREASE you CREDIT them so CREDIT Cash by $1,800.
C. 16 Receives $3,600 from clients for services performed.
This is Revenue because the company is receiving money for service performed.
Revenue brings Cash into the business so the Cash account will INCREASE by $3,600
The Revenue Account will INCREASE by $3,600 to signify that Revenue came in.
Cash as an Asset will be DEBITED for $3,600 to signify that it has INCREASED.
Revenue will be CREDITED because it is an Equity Account to signify that it has INCREASED as well.
D. 27 Pays secretary $1,000 salary.
Payment of salary is an expense.
Expenses are paid from the Cash Account so this means that Cash has DECREASED by $1,000.
The Salaries and Wages Expense is INCREASED by $1,000.
Expenses are generally DEBITED when they increase so the Salaries and Wages Expense will be DEBITED by $1,000.
Cash as an asset will be CREDITED to reflect the DECREASE in the amount by $1,000.
You are a freshman in college and are planning a trip to Europe when you graduate from college at the end of four years. You plan to save the following amounts annually, starting today: $640, $690, $690, and $750. If you can earn 7.60 percent annually, how much will you have at the end of four years
Answer:
$2,980.4
Explanation:
To find the answer, we use the future value of an investment formula:
FV = PV(1 + i)^n
Where:
FV = Future value (the result we are looking forPV = Present value (the initial values that the question has given us)i = interest ratn = number of compounding periodsFor the first $640:
FV = $640(1 + 0.0760)^1
FV = $688.6
For the $690
FV = $688.6 + $690 (1 + 0.0760)^1
FV = $1,431
For the second $690
FV = $1,431 + $690 (1 + 0.0760)^1
FV = $2,173.4
For the final $750
FV = $2,173.4 + $750 (1 + 0.0760)^1
FV = $2,980.4
So at the end of four years, you will have $2,980.4.
This problem will give you some practice working with financial statements and figuring cash flow. Based on the following information for Mara Corporation, prepare an income statement for 2018 and balance sheet for 2017 and 2018. Next, calculate cash flow from assets, cash flow to creditors, and cash flow to stockholders for Mara for 2018. Use a 21 percent tax rate throughout.
2017 2018
Sales 4,203 4,507
Cost of goods sold 2,422 2,633
Depreciation 785 952
Interest 180 196
Dividends 275 352
Current assets 2,205 2,429
Net fixed assets 7,344 7,650
Current liabilities 1,003 1,255
Long-term debt 3,106 2,085
Answer:
Mara Corporation
a) Income Statement for the year 2018:
Sales $4,507
Cost of goods sold 2,633
Gross profit $1,874
Depreciation -952
Interest -196
Income before tax $726
Tax (21% of $726) -152
Net Income $574
Retained Earnings 370 (2017)
Dividends -352
Retained Earnings $592
b) Balance Sheet for 2017 and 2018
Current assets $2,205 $2,429
Net fixed assets 7,344 7,650
Total Assets $9,549 $10,079
Current liabilities $1,003 $1,255
Long-term debt 3,106 2,085
Retained Earnings 370 592
Common Stock * 5,070 6,147
Total Liab.+Equity $9,549 $10,079
Common Stock figures have been obtained as balancing figures.
c) Calculation of Cash Flow in 2018:
i) From Assets:
Increases in Current Assets -$224
Increases in Fixed Assets -306
Total assets cash outflow $530
ii) To creditors:
Increases in Current Liabilities = $252
Decreases in Long-term debt = -1,021
Total creditors cash outflow $769
iii) To stockholders:
Increases in Dividends = $352
Explanation:
a) 2017 Income Statement:
Sales $4,203
Cost of goods sold 2,422
Gross profit $1,781
Depreciation -785
Interest -180
Income before tax $816
Tax (21% of $726) -171
Net Income $645
Dividends -275
Retained Earnings $370
b) Cash flow to stockholders is the amount of cash that a company pays out to its shareholders in the form of cash dividends. Stock dividends are not cash flow to stockholders.
Economists generally define the short run as being Question 1 options: any period of time less than one year. that period of time in which at least one of the firm's inputs, usually plant size, is fixed. any period of time less than six months. that period of time in which all inputs are variable.
Answer:
that period of time in which at least one of the firm's inputs, usually plant size, is fixed
Explanation:
The short run is a period of time when at least one factor of production is fixed.
The short run isn't defined by a period of time. The short run is unique to different firms and industries.
The long run is a period of time when all factors of production are variable.
I hope my answer helps you
The unadjusted trial balance for Green Initiatives as December 31 is provided on the trial balance tab. Information for adjustments is os follows: o. As of December 31, employees had earned $2.000 of unpaid and unrecorded salaries. The next payday is January 4, at which time $2,500 of salaries will be paid. b. The cost of supplies still available at December 31 is $1.400. c. The notes payable requires an interest payment to be made every three months. The amount of unrecorded accrued interest at December 31 is $2.250. The next interest payment, at an amount of $2700. is due on January 15. d. Analysis of the unearned member fees account shows $2,600 remaining unearned at December 31 e. in addition to the member fees included in the revenue account balance, the company has earned another $13.300 In unrecorded fees that will be collected on January 31. The company is also expected to collect $14.000 on that same day for new fees earned in January Depreclation expense for the year is $24.200 St Owners General Journal Income Statement General Ledger Post Closing Balance Sheet
Requirement:
Prepare the required adjusting entries and closing entries for Green Initiatives.
Answer:
Kindly check attached picture
Explanation:
Given:
The unadjusted trial balance for Green Initiatives as December 31 is provided on the trial balance tab. Information for adjustments is os follows: o. As of December 31, employees had earned $2.000 of unpaid and unrecorded salaries. The next payday is January 4, at which time $2,500 of salaries will be paid. b. The cost of supplies still available at December 31 is $1.400. c. The notes payable requires an interest payment to be made every three months. The amount of unrecorded accrued interest at December 31 is $2.250. The next interest payment, at an amount of $2700. is due on January 15. d. Analysis of the unearned member fees account shows $2,600 remaining unearned at December 31 e. in addition to the member fees included in the revenue account balance, the company has earned another $13.300 In unrecorded fees that will be collected on January 31. The company is also expected to collect $14.000 on that same day for new fees earned in January Depreclation expense for the year is $24.200 St Owners General Journal Income Statement General Ledger Post Closing Balance Sheet.
Kindly check attached picture for detailed explanation
At the end of the current year, $22,650 of fees have been earned but have not been billed to clients. Required: A. Journalize the adjusting entry to record the accrued fees on December 31. Refer to the Chart of Accounts for exact wording of account titles. B. If the cash basis rather than the accrual basis had been used, would an adjusting entry have been necessary?
Answer:
A. Adjusting Journal Entries:
Dec. 31, 2019:
Debit Accounts Receivable $22,650
Credit Service Fee Revenue $22,650
To record fees earned, but not yet billed to clients.
B. No. If the cash basis rather than the accrual basis had been used, an adjusting entry would not have been necessary.
Explanation:
Adjusting entries are only required to align the cash-basis accounting records to the accrual basis. Adjustments are made for prepayments of expenses, unpaid expenses, deferred revenue, unearned earned and earned revenue, and depreciation charges. For an entity operating on a cash basis, adjusting entries are not required.
Adjusting entries ensure that accounting records comply with the accrual concept and matching principle of generally accepted account practises. The requirement under this concept with the matching principle is to accrue and match expenses and revenue to the related revenue and expenses and period.
Which crime is BEST represented by the following situation?
Jeff decides that it is time to clean up his act and stop manufacturing drug paraphernalia in his basement. He uses $15,000 from bong pipe sales to open a children’s toy store. The next day, the police bust Jeff for his sale of drug paraphernalia.
A. Robbery
B. Embezzlement
C. Money Laundering
D. Larceny
Answer:
The answer is C. Money Laundering
Explanation:
Solution
From the question stated it can be described as a crime of money laundering.
Money laundering involves the use of illegally obtained money for legitimate purposes.
In this scenario, Jeff uses $15,000 from his illegal sales of drug paraphernalia for setting up a toy store. The origin of the money, which was obtained through illegal method was hidden.
Robbery and larceny are examples of theft that involves stealing items of value from another person. Embezzlement is also a kind of theft. It involves withholding of items with the intention of theft .
Jennifer is holding performance reviews of all kitchen personnel in her restaurant. What is Jennifer's role in the kitchen?
A.
sous chef
B.
line cook
Oc.
kitchen manager
OD
executive chef
Answer:
C
Explanation:
Which of the following gives computers the ability to understand unpredictable language, based on the way humans speak and write? Machine learning Deep learning Natural language processing Computer vision Narrow AI
Answer:
AI (Artificial Intelligence)
Explanation:
In computer science is sometimes known as machine intelligence. It is not like natural intelligence which has been displayed by human beings and by animals naturally.
It is different from natural intelligence. The artificial intelligence is considered to be the academic discipline. There is a traditional problem with AI-related to knowledge, reasoning, planning and learning, and the ability to manipulate and move on.
The AI contains statistical methods, computational methods, etc. This intelligence is created just because it simulates human intelligence.
On January 1, 2021, the general ledger of Big Blast Fireworks includes the following account balances:Accounts Debit Credit Cash $ 25,700 Accounts Receivable 46,000 Allowance for Uncollectible Accounts 4,100 Inventory 49,000 Land 90,100 Accounts Payable 25,700 Notes Payable (6%, due in 3 years) 49,000 Common Stock 75,000 Retained Earnings 57,000 Totals $ 210,800 $ 210,800 The $49,000 beginning balance of inventory consists of 490 units, each costing $100. During January 2021, Big Blast Fireworks had the following inventory transactions:January 3 Purchase 1,750 units for $196,000 on account ($112 each).January 8 Purchase 1,850 units for $216,450 on account ($117 each).January 12 Purchase 1,950 units for $237,900 on account ($122 each).January 15 Return 195 of the units purchased on January 12 because of defects.January 19 Sell 5,700 units on account for $855,000. The cost of the units sold is determined using a FIFO perpetual inventory system.January 22 Receive $837,000 from customers on accounts receivable.January 24 Pay $620,000 to inventory suppliers on accounts payable.January 27 Write off accounts receivable as uncollectible, $2,800.January 31 Pay cash for salaries during January, $138,000.The following information is available on January 31, 2021.At the end of January, the company estimates that the remaining units of inventory are expected to sell in February for only $100 each.The company estimates future uncollectible accounts. The company determines $5,900 of accounts receivable on January 31 are past due, and 35% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.)Accrued interest expense on notes payable for January. Interest is expected to be paid each December 31.Accrued income taxes at the end of January are $14,200.Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 - 10) assuming a FIFO perpetual inventory system. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.2. Record adjusting entries on January 31. in the 'General Journal' tab (these are shown as items 11-14).3. Review the adjusted 'Trial Balance' as of January 31, 2021, in the 'Trial Balance' tab.4. Prepare a multiple-step income statement for the period ended January 31, 2021, in the 'Income Statement' tab.5. Prepare a classified balance sheet as of January 31, 2021, in the 'Balance Sheet' tab.6. Record the closing entries in the 'General Journal' tab (these are shown as items 15 and 16).7. Using the information from the requirements above, complete the 'Analysis' tab.
Answer:
Big Blast Fireworks
a) General Journal to record transactions:
Jan. 3
Debit Inventory $196,000
Credit Accounts Payable $196,000
To record the purchase of 1,750 units at $112 each
Jan. 8
Debit Inventory $216,450
Credit Accounts Payable $216,450
To record the purchase of 1,850 units at $117 each
Jan. 12
Debit Inventory $237,900
Credit Accounts Payable $237,900
To record the purchase of 1,950 units at $122 each
Jan. 15
Debit Accounts Payable $23,790
Credit Inventory $23,790
To record the return of 195 units at $122 each.
Jan. 19
Debit Accounts Receivable $855,000
Credit Sales Revenue $855,000
To record the sale of 5,700 units on account.
Debit Cost of Goods Sold $657,870
Credit Inventory $657,870
To record the cost of sales of 5700 units.
Jan. 22
Debit Cash Account $837,000
Credit Accounts Receivable $837,000
To record cash receipt from customers.
Jan. 24
Debit Accounts Payable $620,000
Credit Cash Account $620,000
Jan. 27
Debit Allowance for Uncollectible Accounts $2,800
Credit Accounts Receivable $2,800
To record the write-off of uncollectible.
Jan. 31
Debit Salaries & Wages Expense $138,000
Credit Cash Account $138,000
To record the payment of cash for salaries
2. Adjusting Entries on January 31, 2021:
Debit Loss on Inventory $3,190
Credit Inventory $3,190
To record the loss in value.
Debit Allowance for Uncollectible Accounts $2,065
Credit Accounts Receivable $2,065
To record the write-off of uncollectible.
Debit Uncollectible Expense $3,722
Credit Allowance for Uncollectible Accounts $3,722
To bring the allowance for uncollectible accounts to $2,957.
Debit Interest on Notes Payable $245
Credit Interest Payable $245
To record accrued interest for the month
3. Adjusted Trial Balance at January 31, 2021:
Debit Credit
Cash $104,700
Accounts Receivable 59,135
Allowance for Uncollectible Accounts 2,957
Beginning Inventory 49,000
Ending Inventory 14,500
Land 90,100
Salaries 138,000
Loss on Inventory 3,190
Uncollectible Expense 3,722
Interest on Notes Payable 245
Cost of Goods Sold 657,870
Sales Revenue 855,000
Accounts Payable 32,260
Notes Payable (6%, due in 3 years) 49,000
Interest on Notes Payable 245
Common Stock 75,000
Retained Earnings 57,000
Totals $1,071,462 $1,071,462
Balance Sheet at January 31, 2021:
Assets:
Cash $104,700
Accounts Receivable 59,135
Less uncollectible allw. -2,957
Inventory 14,500
Land 90,100
Total $265,478
Liabilities:
Accounts Payable 32,260
Notes Payable (6%, due in 3 years) 49,000
Interest on Notes Payable 245 $81,505
Common Stock 75,000
Retained Earnings 108,973 $183,973
Total $265,478
Explanation:
a) Unadjusted Trial Balance at January 1, 2021:
Debit Credit
Cash $ 25,700
Accounts Receivable 46,000
Allowance for Uncollectible Accounts 4,100
Inventory 49,000
Land 90,100
Accounts Payable 25,700
Notes Payable (6%, due in 3 years) 49,000
Common Stock 75,000
Retained Earnings 57,000
Totals $ 210,800 $ 210,800
b) Accounts Receivable
Beginning balance $46,000
Credit Sales $855,000
less write-off -2800
less write-off -2,065
less cash receipts -$837,000
Ending balance $59,135
c) Estimated uncollectible allowance = $2,957 (5% of accounts receivable balance, i.e $59,135)
d) Uncollectible Expense:
Ending balance $2957
Plus write-off 2,800
plus write-off 2,065
Beginning balance -4,100
Uncollectible expense 3,722
e) Cash Account balance:
Beginning balance $25,700
Cash from customers $837,000
Payment to suppliers-$620,000
Salaries -$138,000
Ending balance $104,700
f) Accounts Payable
Beginning balance $25,700
Inventory:
1,750 units for $196,000
1,850 units for $216,450
1,950 units for $237,900
195 units return -$23,790
less payment -$620,000
Ending Balance $32,260
g) Income Statement:
Sales $855,000
less cost of sales -657,870
Gross Income $197,130
Salaries -138,000
Loss on Inventory -3,190
Uncollectible Exp -3,722
Interest on Note -245
Net Income $51,973
Retained Earning 57,000
Ending R/Earnings$108,973
Cost of Goods Sold, using FIFO:
490 units at $100 each $49,000
1,750 units at $112 each $196,000
1,850 units at $117 each $216,450
1,610 units at $122 each $196,420
7,500 units sold $657,870
Lance Murdock purchased a wooden statue of a Conquistador for $ 7 comma 200 to put in his home office 7 years ago. Lance has recently married, and his home office is being converted into a sewing room. His new wife, who has far better taste than Lance, thinks the Conquistador is hideous and must go immediately. Lance decided to sell it on e-Bay and only received $4 comma 700 for it, and so he took a loss on the investment. What was his rate of return, that is, the value of i?
Answer:
-5.91%
Explanation:
The rate of return can be determined using the future value formula as shown below:
FV=PV*(1+r)^n
FV is the amount the wooden statue was sold for after it was purchased seven years which is $4700
PV is the original cost of the wooden statue
r is the unknown
n is the number of years which 7 years
4,700=7,200*(1+r)^7
divide both sides by 7,200
4700/7200=(1+r)^7
0.652777778 =(1+r)^7
divide the index on both sides by 7
(0.652777778) ^(1/7)=1+r
0.940887955 =1+r
r=0.940887955 -1
r=-0.059112045 =-5.91%
Concord Corporation issued 113,000 shares of $19 par value, cumulative, 7% preferred stock on January 1, 2019, for $2,630,000. In December 2021, Concord declared its first dividend of $720,000. (a) Prepare Concord’s journal entry to record the issuance of the preferred stock.
Answer:
(a)
Dr. Cash $2,630,000
Cr. Preferred Stock $2,147,000
Cr. Add-in-Capital excess of par preferred stock $483,000
Explanation:
Preferred stockholders has an advantage that they are paid first when there is any dividend is announced. The residual dividend will be divided into the common stockholders. Any prior years due dividend and current years dividend associated with preferred share will be paid first.
Par value = 113,000 x 19 = $2,147,000
Excess of par value = $2,630,000 - $2,147,000 = $483,000
The top management of Wisniewski Automobile Parts Inc. has decided that the company's objective for the next two years will be to expand the overall business internationally. This is an example of ________ planning.
Answer:
Strategic planning
Explanation:
Strategic planning is defined as the process by which a business outlines direction and strategy. It also involves decision on how the business will allocate it's resources to achieve its strategic goals.
Strategic plan involves formulation of mission, vision, and plan of action that will make the business achieve set goals.
In this scenario top management of Wisniewski Automobile Parts Inc. has decided that the company's objective for the next two years will be to expand the overall business internationally. This is the strategic plan of the business for the next two years