Answer:
See answer below.
Explanation:
The depreciable amount of the machine is computed as follows.
cost - residual value = 1,567,500 - 82,500 = $1,485,000.
Estimated usefule life = 5 years
Question 1
Using the straight line depreciation method, the asset will be depreciated equally every year by [tex]\frac{Total Depreciation}{UsefulLife} =\frac{1,485,000}{5} =297,000[/tex]
Year 1 Depreciation = $297,000
Year 2 Depreciation = $297,000
Year 3 Depreciation = $297,000
Year 4 Depreciation = $297,000
Year 5 Depreciation = $297,000
Question 2
Using the unit of production method, the machine will be depreciated by the ratio of actual usage to estimated production life, until it is fully depreciated.
Year 1 Depreciation = [tex]\frac{Annual Usage}{Estimated Life} *Total Depreciation=\frac{170,000}{300,000} *1,485,000[/tex] = $841,500
Year 2 Depreciation = [tex]\frac{67,000}{300,000} *1,485,000[/tex] = $331,650
Year 3 Depreciation = [tex]\frac{50,000}{300,000} *1,485,000[/tex] = $247,500
Year 4 Depreciation = [tex]Total Depreciation - Accumulated Depreciation=1,485,000-(841,500+331,650+247,500)[/tex]= $64,350
Year 5 Depreciation = 0.
Year 4 computation arose because the computed depreciation using the unit of production method [tex]\frac{73,000}{300,000} *1,485,000=361,350[/tex] would push the computed accumulated depreciation beyond the total depreciation allowed. As such, the residual balance was adopted in year 4.
Question 3
Using the double declining balance method, the machine would be depreciated at twice the depreciation rate of the straight line balance on the reducing balance of the asset, until this method results in a depreciation figure lower than the straight line method.
Depreciation rate = [tex]2*StraightLineRate=2*(\frac{1}{5} )= 2* 0.20=0.40[/tex] = 40%
Year 1 depreciation = [tex]0.40*1,485,000[/tex] = $594,000
Year 2 depreciation = [tex]0.40*(1,485,000-594,000)[/tex] = $356,400
Year 3 depreciation = [tex]\frac{1,485,000-594,000-356,400}{3}[/tex]= $178,200
Year 4 depreciation = [tex]\frac{1,485,000-594,000-356,400}{3}[/tex]= $178,200
Year 5 depreciation = [tex]\frac{1,485,000-594,000-356,400}{3}[/tex]= $178,200.
Because year 3 depreciation using the usual double declining method [tex]0.40*(1,485,000-594,000-356,400)= 213,840[/tex] would result in a figure lower than the straight line depreciation rate (297,000), we used the straight line formula for the depreciation from years 3 to 5.
What is the definition of punctual? a. To be accurate. b. Adapting to your surroundings. c. Being on time. d. Having the ability to do more than one task at a time.
Answer:
c. Being on time.
Explanation:
Punctual is strictly adhering to the time set. A punctual person is never late for meetings or events. It's on time.
Punctual in making payments means the payments were not delayed. Punctuality refers to the ability to follow a schedule or a timetable.
Felicia works for a news organization as a reporter. For the most part her work is solitary, and she only has brief communications via email or telephone with her editor (her boss) when she submits her stories. While Felicia is a good news reporter, the economy has taken a downfall and the organization likely will have to lay off some employees. Felicia is most likely to perceive this situation as:
Answer:
The correct answer is: Personal threat
Explanation:
Analyzing the above scenario, Felicia is considered more likely to perceive this situation as a personal threat.
This is due to her job function, which is a good news reporter, and with the economy declining and the organization will probably have to fire some employees, she feels threatened personally, as she is more likely to realize that the economic situation negative will directly influence the good news that she sends to the news agency, so she feels that this situation is threatening to the performance of her work and the agency may fire her because there is no good news for publication.
Straight Industries purchased a large piece of equipment on January 1, 2016. Straight Industries signed a note, agreeing to pay $400,000 for the equipment on December 31, 2018. The market rate of interest for similar notes was 8%. The present value of $400,000 discounted at 8% for three years was $317,520. On January 1, 2016, Straight Industries recorded the purchase with a debit to equipment for $317,520 and a credit to notes payable for $317,520. Assuming no adjusting entries have been made during the year, the interest expense accrued at December 31, 2016 is closest to:
Answer:
$25,402
Explanation:
Calculation for the amount of interest accrued at December 31, 2016
Using this formula
Interest expense accrued= 2016 Beginning Note payable liability*Interest rate
Let plug in the formula
Interest expense accrued =$317,520*8%
Interest expense accrued =$25,402
Therefore the interest expense accrued at December 31, 2016 is closest to $25,402
Marr Co. had the following sales and accounts receivable balances, prior to any adjustments at year end: Credit sales $10,000,000 Accounts receivable 3,000,000 Allowance for uncollectible accounts (debit balance) 50,000 Marr uses 3% of accounts receivable to determine its allowance for uncollectible accounts at year end. By what amount should Marr adjust its allowance for uncollectible accounts at year end
Answer:
$140,000
Explanation:
The computation is shown below:
Ending allowance for uncollectible accounts is
= Accounts receivable × Given percentage
= $3,000,000 × 3%
= $90,000
Now the
Adjusted balance is
= Ending allowance for uncollectible accounts + debit balance of Allowance for uncollectible accounts
= $90,000 + $50,000
= $140,000
HELP PLEASE.
Recent research indicates that it may take only a few minutes to prevent unethical behavior. When workers face a choice between right and
wrong, they are about five times more likely to make the unethical choice when the decision is rushed.* Think about times in your life when you faced a moral decision and made the wrong choice. Did you feel rushed to make the decision? If you had taken more time to think or consult an ethical colleague, would you have made a different decision? (5-7 sentences )
Answer:
I had once visited a client and he, unusually, offered me a complimentary tip. Somewhere at the back of my mind, it felt off. So I declined. He on the other hand persisted.
Because I wanted to round up the meeting, I eventually accepted and left.
The next day was our weekly in-house academy - a day of the week when we set aside about 2 hours for learning and re-learning.
At that meeting, the HR Executive did a reminder on the value of the organisation, as well as the ethics which guide our operations. There she mentioned categorically that it was prohibited by the company to accept any type of cash gifts from the client or from the insurance companies.
As, soon as the meeting was done, I reported myself to the HR Executive and she advised that I return it and I did immediately, thankfully, the exact note was still in my possession.
I wrote a letter to the client respectfully returning the gift on the grounds that company policy forbade it and that marked the end of that episode.
If I had the company blueprint on ethics at my fingertips, I would have insisted on my initial position not to take the gift.
Cheers
Mole Mfg. has asked you to develop a chase plan for the production of its earth moving equipment. Below is the beginning inventory, monthly demand, and relevant work force information. Determine the total hire/fire costs and the number of workers employed at the end of October. Note: The ending inventory for October should be 0. July Beginning Inventory 1200: Demand is July 3300; Aug 3000; Sept 2550; Oct 2400. Hiring costs $50 per worker; firing costs $100 per worker; production rate 15 units per month per worker; starting workforce 200 workers
Answer:
Mole Mfg.
Mole's total hire/fire costs and the number of workers employed at the end of October.
a) Hire/Fire Costs
i) Hire costs = 60 * $50 = $3,000
ii) Fire costs = 100 * $100 - $10,000
b) Number of workers employed at the end of October
= 160 workers
Explanation:
a) Data and Calculations:
Inventory requirement:
Beginning Inventory 1200
Month Demand Units Production No. of Workers No. of Hire No. of Fire
Starting workforce 200
July 3300 -1,200 2,100 140 (2,100/15) 60
Aug 3000 3,000 200 (3,000/15) 60
Sept 2550 2,550 170 (2,550/15) 30
Oct 2400 2,400 160 (2,400/15) 10
Total 60 100
On June 1, Royal Corp. began operating a service company with an initial cash investment by shareholders of $3,206,000. The company provided $8,200,000 of services in June and received full payment in July. Royal also incurred expenses of $2,645,000 in June that were paid in August. During June, Royal paid its shareholders cash dividends of $490,000. What was the company's income before income taxes for the two months ended July 31 under the following methods of accounting
Answer:
Cash Basis= $8,200,000
Accrual Basis= $5,555,000
Explanation:
Calculation for the company's income before income taxes for the two months ended July 31
Based on the information given we were told that the company provided the amount of $8,200,000 of services in the month of June and received full payment of the amount in the month of July which means that the CASH BASIS will be $8,200,000
Cash Basis= $8,200,000
Calculation for Accrual Basis
Using this formula
Accrual Basis= Cash received - Incurred expenses
Accrual Basis= $8,200,000-$2,645,000
Accrual Basis= $5,555,000
Therefore the company's income before income taxes for the two months ended July 31 under the Cash Basis and Accrual Basis methods of accounting will be :
Cash Basis= $8,200,000
Accrual Basis= $5,555,000
Suppose that real GDP grew more in Country A than in Country B last year.
a. Country A must have a higher standard of living than country B.
b. Country A's worker productivity must have grown faster than country B's.
c. Both of the above are correct.
d. None of the above are correct.
Answer:
D
Explanation:
Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year
Nominal GDP is GDP calculated using current year prices while Real GDP is GDP calculated using base year prices. Real GDP has been adjusted for inflation.
The standard of living is calculated as real GDP / population. Even though the real GDP of country A grew faster than country B, country A's population might be higher than country B's making its standard of living lower.
To make a conclusion that the growth of country A's worker productivity grew faster, it must be assumed that population grew at the same rate in both countries
Kepler Company Comparative Income Statements This Year Last Year Sales $ 950,000 $ 900,000 Less: Cost of goods sold 500,000 490,000 Gross margin $ 450,000 $ 410,000 Less: Selling and administrative expenses 275,000 260,000 Operating income $ 175,000 $ 150,000 Less: Interest expense 12,000 18,000 Income before taxes $ 163,000 $ 132,000 Less: Income taxes 65,200 52,800 Net income $ 97,800 $ 79,200 Less: Dividends (common) 27,800 19,200 Net income, retained $ 70,000 $ 60,000 Also, assume that for last year and for the current year, the market price per share of common stock is $2.98. In addition, for last year, assets and equity were the same at the beginning and end of the year. Required: Note: Round all answers to two decimal places. 1. Compute the following for each year: This Year Last Year a. Return on assets % % b. Return on stockholders' equity % % c. Earnings per share $ $ d. Price-earnings ratio e. Dividend yield % % f. Dividend payout ratio
Kepler Company
Comparative Balance Sheets
This Year Last Year
Assets
Current assets:
Cash $ 50,000 $100,000
Accounts receivable, net 300,000 150,000
Inventory 600,000 400,000
Prepaid expenses 25,000 30,000
Total current assets $ 975,000 $680,000
Property and equipment, net 125,000 150,000
Total assets $1,100,000 $830,000
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 400,000 $290,000
Short-term notes payable 200,000 60,000
Total current liabilities $ 600,000 $350,000
Long-term bonds payable, 12% 100,000 150,000
Total liabilities $ 700,000 $500,000
Stockholders' equity:
Common stock
(100,000 shares) 200,000 200,000
Retained earnings 200,000 130,000
Total liabilities and
stockholders' equity $1,100,000 $830,000
Answer:
Kepler Company
a. Return on assets = Net Income/Total Assets
= $ 97,800/$1,100,000 $ 79,200/$830,000
= 8.89% = 9.54%
b. Return on stockholders' equity = Net Income/Stockholders' equity
= $ 97,800/$400,000 $ 79,200/$330,000
= 24.45% = 24%
c. Earnings per share = Net Income/Outstanding common shares
= $ 97,800/100,000 $ 79,200/100,000
= $0.98 = $0.79
d. Price-earnings ratio = Market price/Earnings per share
= $2.98/$0.98 = $2.98/$0.79
= 3.04 times = 3.77 times
e. Dividend yield = Dividend per share/price per share
= $0.28/$2.98 = $0.19/$2.98
= 9.40% = 6.38%
f. Dividend payout ratio = Total dividends/Net Income
= $27,800/$97,800 = $19,200/$79,200
= 28.43% = 24.24%
Explanation:
Kepler Company
Comparative Income Statements
This Year Last Year
Sales $ 950,000 $ 900,000
Less: Cost of goods sold 500,000 490,000
Gross margin $ 450,000 $ 410,000
Less: Selling and
administrative expenses 275,000 260,000
Operating income $ 175,000 $ 150,000
Less: Interest expense 12,000 18,000
Income before taxes $ 163,000 $ 132,000
Less: Income taxes 65,200 52,800
Net income $ 97,800 $ 79,200
Less: Dividends (common) 27,800 19,200
Net income, retained $ 70,000 $ 60,000
Sheet Company reported the following net income and dividends for the years indicated: Year Net Income Dividends 20X5 $ 35,000 $ 12,000 20X6 45,000 20,000 20X7 30,000 14,000 Pillow Corporation acquired 75 percent of Sheets common stock on January 1, 20X5. On that date, the fair value of Sheet net assets was equal to the book value. Pillow uses the equity method in accounting for its ownership in Sheet and reported a balance of $259,800 in its investment account on December 31, 20X7. Required: a. What amount did Pillow pay when i
Answer:
A. $211,800
B. $282,400
C. $70,600
D. $ 86,600
Explanation:
A. Calculation for the amount that True pay when it purchased Exacto’s shares
Balance in investment account, December 31, 20x7$259,800
Cumulative earnings since acquisition$110,000
Less Cumulative dividends since acquisition(46,000)
Total$64,000
($110,000-46,000)
×Proportion of stock held by True Corporation 0.75
=Total amount debited to Investment account(48,000)
(64,000*0.75)
Purchase amount on January 1, 20X5$211,800
($259,800-$48,000)
B. Calculation for the fair value of Exacto’s net assets on January 1, 20X5
True Corporation’s Purchase amount$211,800
÷True Corp.’s percentage 0.75
=Fair Value of Exacto Company’s Net Assets$282,400
($211,800÷0.75)
C. Calculation for What amount was assigned to the NCI shareholders on January 1, 20X5
Fair Value of Exacto Company’s Net Asset$282,400
×Exacto Company’s percentagex0.25
=NCI’s portion$70,600
($282,400×0.25)
D. Calculation forWhat amount will be assigned to the NCI shareholders
True Corp’s investment balance$259,800
True Corp’s percentage÷0.75
=Fair Value of Exacto’s Net Assets 20X7 $346,400
×Exacto Company’s percentage 0.25
=NCI’s Portion, December 31, 20X7$ 86,600
($346,400×0.25)
If you are interested in working for a specific company, what type of job site should you look at for opening?
a. Geographic specific site
b. Industry specific site
C. Company site
d. General job site
Please select the best answer from the choices provided
А
B
С
D
Answer:
B. industry specific site
An industry specific site is the type of job site should you look at for opening. Hence, option B is correct.
As the term implies, "industry specific software" refers to any digital solution made specifically for a certain industry or specialized market. Despite the fact that every business is unique, not all need an expensive custom software solution.
Understanding market trends and best practices also means knowing how to put them into practice as efficiently as possible. A startup founder or a small business owner can greatly benefit from industry-specific solutions and insights in gaining a competitive edge.
Industries are frequently divided into categories based on the goods and services they provide. For instance, the pizza sector encompasses all businesses that produce and promote pizza.
Thus, option B is correct.
For more details about industry specific, click here:
https://brainly.com/question/13320210
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Charter Company, which uses the perpetual inventory method, purchases different letters for resale. Charter had a beginning inventory comprised of seven units at $4 per unit. The company purchased five units at $6 per unit in February, sold seven units in October, and purchased two units at $7 per unit in December. If Charter Company uses the LIFO method, what is the cost of its ending inventory
Answer:
Ending inventory cost= $34
Explanation:
Giving the following information:
Beginning inventory= 7 units for $4 per unit.
Purchased= 5 units for $6
Sold= 7 units
Purchased= 2 units for $7 each
Under the LIFO (last-in, first-out) method, the cost of ending inventory is calculated using the cost of the firsts units incorporated into inventory. The perpetual inventory system recognizes sales after it happens.
Ending inventory:
Beginning inventory= 7*4= 28
Purchased= 5*6= 30
Sold= (5*6) + (2*4)= (38)
Purchased= 2*7= 14
Ending inventory cost= $34
A firm has fixed operating costs of $10,000, the sale price per unit of its product is $25, and its variable cost per unit is $15. The firm's operating breakeven point in units is ________ and its breakeven point in dollars is ________.
A) 1,000; $6,250.
B) 400; $10,000.
C) 400; $25,000.
D) 1,000; $25,000.
Answer:
The correct answer is D.
Explanation:
Giving the following information:
Fixed costs= $10,000
Selling price= $25
Unitary variable cost= $15
To calculate the break-even point in units and dollars, we need to use the following formulas:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 10,000 / (25 - 15)
Break-even point in units= 1,000
Break-even point (dollars)= fixed costs/ contribution margin ratio
Break-even point (dollars)= 10,000 / (10/25)
Break-even point (dollars)= $25,000
Answer:
D) 1,000; $25,000.
Explanation:
Let us assume the company produces x units. The total cost is:
Total cost = fixed cost + variable cost × number of items = $10000 + 15 × x = 10000 + 15x
The revenue = number of unit × price per unit = x × $25 = 25x
At breakeven, the revenue and cost are equal, therefore:
25x = 10000 + 15x
25x - 15x = 10000
10x = 10000
x = 10000/10
x = 1000 units
The price at breakeven point = 25x = 25(1000) = $25000
Discussion #6 - Inventory Methods (due Thurs/Sun) 1010 unread replies.1010 replies. The following is an excerpt from a conversation between Paula Marlo, the warehouse manager for Musick Foods Wholesale Co., and its accountant, Mike Hayes. Musick Foods operates a large regional warehouse that supplies produce and other grocery products to grocery stores in smaller communities. Paula: Mike, can you explain what's going on here with these monthly statements? Mike: Sure, Paula. How can I help you? Paula: I don't understand this last-in, first-out inventory procedure. It just doesn't make sense. Mike: Well, what it means is that we assume that the last goods we receive are the first ones sold. So the inventory consists of the items we purchased first. Paula: Yes, but that's my problem. It doesn't work that way! We always distribute the oldest produce first. Some of that produce is perishable! We can't keep any of it very long or it'll spoil. Mike: Paula, you don't understand. We only assume that the products we distribute are the last ones received. We don't actually have to distribute the goods in this way. Paula: I always thought that accounting was supposed to show what really happened. It all sounds like "make believe" to me! Why not report what really happens?
Answer:
Musick Foods Wholesale Co. is permitted by the US GAAP to use the LIFO (Last In, First Out) inventory valuation method. The use of LIFO offers Musick and other firms the opportunity to save on taxes as well as better match their revenue to their latest costs when prices are rising.
Explanation:
Using LIFO method of measuring the value of inventory, the costs of the most recent products purchased (or produced) by Musick Foods are the first to be expensed. It is not that in practice, those costs expensed refer to the units being sold first, it is merely an assumption permitted by the US FASB under her generally accepted accounting principles (GAAP).
Creswell Corporation's fixed monthly expenses are $30,000 and its contribution margin ratio is 63%. Assuming that the fixed monthly expenses do not change, what is the best estimate of the company's net operating income in a month when sales are $92,000?
a. $27,960.b. $62,000.c. $57,960.d. $4,040.
Answer:
Net income= $27,960
Explanation:
Giving the following information:
Fixed costs= $30,000
contribution margin ratio= 0.63
Sales= $92,000
First, we need to calculate the total contribution margin:
Total contribution margin= 92,000*0.63= 57,960
Now, the net income:
Net income= 57,960 - 30,000
Net income= $27,960
The following selected transactions were completed by Capers Company during October of the current year:
Oct. 1
Purchased merchandise from UK Imports Co., $13,377, terms FOB destination, n/30.
3 Purchased merchandise from Hoagie Co., $10,650, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $230 was added to the invoice.
4 Purchased merchandise from Taco Co., $14,350, terms FOB destination, 2/10, n/30.
6 Issued debit memo to Taco Co. for $5,000 of merchandise returned from purchase on October 4.
13 Paid Hoagie Co. for invoice of October 3.
14 Paid Taco Co. for invoice of October 4, less debit memo of October 6.
19 Purchased merchandise from Veggie Co., $25,850, terms FOB shipping point, n/eom.
19 Paid freight of $430 on October 19 purchase from Veggie Co.
20 Purchased merchandise from Caesar Salad Co., $23,000, terms FOB destination, 1/10, n/30.
30 Paid Caesar Salad Co. for invoice of October 20.
31 Paid UK Imports Co. for invoice of October 1.
31
Paid Veggie Co. for invoice of October 19.
Journalize the entries to record the transactions of Capers Company for October. Refer to the Chart of Accounts for exact wording of account titles.
CHART OF ACCOUNTS
Capers Company
General Ledger
ASSETS
110
Cash
120
Accounts Receivable
125
Notes Receivable
130
Merchandise Inventory
131
Estimated Returns Inventory
140
Office Supplies
141
Store Supplies
142
Prepaid Insurance
180
Land
192
Store Equipment
193
Accumulated Depreciation-Store Equipment
194
Office Equipment
195
Accumulated Depreciation-Office Equipment
LIABILITIES
211
Accounts Payable-Caesar Salad Co.
212
Accounts Payable-Hoagie Co.
213
Accounts Payable-Taco Co.
214
Accounts Payable-UK Imports Co.
215
Accounts Payable-Veggie Co.
216
Salaries Payable
218
Sales Tax Payable
219
Customers Refunds Payable
221
Notes Payable
EQUITY
310
Owner, Capital
311
Owner, Drawing
312
Income Summary
REVENUE
410
Sales
610
Interest Revenue
EXPENSES
510
Cost of Merchandise Sold
521
Delivery Expense
522
Advertising Expense
524
Depreciation Expense-Store Equipment
525
Depreciation Expense-Office Equipment
526
Salaries Expense
531
Rent Expense
533
Insurance Expense
534
Store Supplies Expense
535
Office Supplies Expense
536
Credit Card Expense
539
Miscellaneous Expense
710
Interest Expense
Journalize the entries to record the transactions of Capers Company for October. Refer to the Chart of Accounts for exact wording of account titles.
PAGE 10
JOURNAL
DATE
DESCRIPTION
POST. REF.
DEBIT
CREDIT
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
Answer:
Oct. 1 Purchased merchandise from UK Imports Co., $13,377, terms FOB destination, n/30.
Dr Merchandise inventory 13,377
Cr Accounts payable 13,377
Oct. 3 Purchased merchandise from Hoagie Co., $10,650, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $230 was added to the invoice.
Dr Merchandise inventory 10,880
Cr Accounts payable 10,880
Oct. 4 Purchased merchandise from Taco Co., $14,350, terms FOB destination, 2/10, n/30.
Dr Merchandise inventory 14,350
Cr Accounts payable 14,350
Oct. 6 Issued debit memo to Taco Co. for $5,000 of merchandise returned from purchase on October 4.
Dr Accounts payable 5,000
Cr Merchandise inventory 5,000
Oct. 13 Paid Hoagie Co. for invoice of October 3.
Dr Accounts payable 10,880
Cr Cash 10,667
Cr Purchase discounts 213
Oct. 14 Paid Taco Co. for invoice of October 4, less debit memo of October 6.
Dr Accounts payable 9,350
Cr Cash 9,163
Cr Purchase discounts 187
Oct. 19 Purchased merchandise from Veggie Co., $25,850, terms FOB shipping point, n/eom.
Dr Merchandise inventory 25,850
Cr Accounts payable 25,850
Oct. 19 Paid freight of $430 on October 19 purchase from Veggie Co.
Dr Merchandise inventory 430
Cr Cash 430
Oct. 20 Purchased merchandise from Caesar Salad Co., $23,000, terms FOB destination, 1/10, n/30.
Dr Merchandise inventory 23,000
Cr Accounts payable 23,000
Oct. 30 Paid Caesar Salad Co. for invoice of October 20.
Dr Accounts payable 23,000
Cr Cash 22,770
Cr Purchase discounts 230
Oct. 31 Paid UK Imports Co. for invoice of October 1.
Dr Accounts payable 13,377
Cr Cash 13,377
Oct. 31 Paid Veggie Co. for invoice of October 19.
Dr Accounts payable 25,850
Cr Cash 25,850
At the end of January of the current year, the records of Donner Company showed the following for a particular item that sold at $15.00 per unit:
Transactions Units Amount
Inventory, January 1 500 $2,500
Purchase, January 12 620 4,340
Purchase, January 26 100 900
Sale (380)
Sale (210)
Between FIFO or LIFO, which method would produce the more favorable cash flow?
Answer:
FIFO method decreases COGS and increases net income, but both methods will result in a similar cash flow ($8,850).
Explanation:
cost of goods sold using FIFO:
380 x $5 = $1,900
(120 x $5) + (90 x $7) = $1,230
total = $3,130
profit = (590 x $15) - $3,130 = $5,720
cost of goods sold using LIFO:
(100 x $9) + (280 x $7) = $2,860
210 x $7 = $1,470
total = $4,330
profit = (590 x $15) - $4,330 = $4,520
assuming that the company does not incur any operating costs:
Cash flow from operating activities (using FIFO):
Net income $5,270
adjustments to net income:
Decrease in inventory $3,130
Net cash flow $8,850
Cash flow from operating activities (using LIFO):
Net income $4,520
adjustments to net income:
Decrease in inventory $4,330
Net cash flow $8,850
Prepare any necessary general journal entries.
(Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Date Account Titles and Explanation Debit Credit June 30 enter an account title to record miscellaneous expenses enter a debit amount enter a credit amount enter an account title to record miscellaneous expenses enter a debit amount enter a credit amount (To record bank service charges) June 30 enter an account title for the journal entry to correct error in recording deposit on June 20 enter a debit amount enter a credit amount enter an account title for the journal entry to correct error in recording deposit on June 20 enter a debit amount enter a credit amount (To correct error in recording deposit on June 20) June 30 enter an account title to record EFT transfer enter a debit amount enter a credit amount enter an account title to record EFT transfer enter a debit amount enter a credit amount (To record EFT transfer) June 30 enter an account title to record NSF check enter a debit amount enter a credit amount enter an account title to record NSF check enter a debit amount enter a credit amount (To record NSF check)
Answer:
Necessary General Journal Entries:
Date Account Titles and Explanation Debit Credit
June 30 Miscellaneous Expenses $200
Cash Account $200
To record bank service charges.
June 20 Cash Account $300
Accounts Receivable $300
To correct error in recording deposit on June 20.
June 30 Cash Account $400
Accounts Receivable $400
To record EFT transfer received from XYZ Co. on account.
June 30 Accounts Receivable $500
Cash Account $500
To record NSF check received from Zoma Inc.
Explanation:
Company B's general journal is used to record business transactions as they occur initially. The entries identify the accounts involved and the required entries to be made as they are supposed to appear in the general ledger. Accounts to be debited are entered first before accounts to be credited for each transaction.
Comparing with unemployment rate with employment rate, which of the following is NOT correct? a. Unemployment rate takes the group of "out of labor force" into account. b. Compared with unemployment rate, employment rate is better because it concerns the hidden unemployment in the out of labor force group. c. Compared with employment rate, unemployment rate in a labor market usually has a larger variation. d. It has limitation because some policy shocks unrelated to unemployment or labor market situation such changes in fertility and school enrollment rates, will affect the number of the employment rate as well.
Answer:
b. Compared with unemployment rate, employment rate is better because it concerns the hidden unemployment in the out of labor force group.
Explanation:
Remember, the employment rate is used to determine the degree to which the labor force (people willing to work) in a particular economy are able to find work.
Hence, it does not concern itself or takes into account the hidden unemployment in the out of the labor force group, but only those people willing to work are considered.
Would you rather own your own business or become a franchise
Answer:
own a business
Explanation:
I'm able to create my own brand and free to do what I want
Answer:
{: Own My Own Business :}
Explanation:
I would rather own my own business so that I could get lots of money yet give other people money ^w^ It would also be a restaurant. Most likely so I could eat da food as in.. 'taste' da food. :}
If the liabilities of a company increased $110,000 during a period of time and equity in the company decreased $37,000 during the same period, what was the effect on the assets?
Answer:
Increase of $73,000
Explanation:
As we know that
The accounting equation is
Assets = Liabilities + Owner's Equity
So it can be said that
Change in Assets = Change in Liabilities + Change in Owner's Equity
Change in Assets = Increase of $110,000 + Decrease of $37,000
Change in Assets = Increase of $73,000
hence, the impact of the asset is $73,000 and the same is to be considered
Old Time Savings Bank pays 3% interest on its savings accounts. If you deposit $3,000 in the bank and leave it there: (Do not round intermediate calculations. Round your answers to 2 decimal places.) a. How much interest will you earn in the first year?
Answer:
Interest= $90
Explanation:
Giving the following information:
Initial investment= $3,000
i= 3%
Number of periods= 1
First, we need to calculate the future value, using the following formula:
FV= PV*(1+i)^n
FV= 3,000*1.03= $3,090
Now, the interest earned:
Interest= 3,090 - 3,000
Interest= $90
Big Box Store has operated with a 30% average gross profit ratio for a number of years. It had $107,000 in sales during the second quarter of this year. If it began the quarter with $18,700 of inventory at cost and purchased $72,700 of inventory during the quarter, its estimated ending inventory by the gross profit method is:
Answer:
$16,500
Explanation:
The computation of the estimated ending inventory is given below:
As We know that
Cost of goods sold = Beginning inventory + purchase made - ending inventory
And, the
Sales - gross profit = Cost of goods sold
So,
$107,000 - $107,000 × 30% = Cost of goods sold
Therefore, the cost of goods sold is
= $107,000 - $32,100
= $74,900
And, finally the ending inventory is
$74,900 = $18,700 + $72,700 - ending inventory
$74,900 = $91,400 - ending inventory
So, the ending inventory is
= $91,400 - $74,900
= $16,500
"Aldrich and Co. sold goods to Donovan on credit.The amount owed grew steadily, and finally Aldrichrefused to sell any more to Donovan unless Donovansigned a promissory note for the amount due.Donovan did not want to but signed the notebecause he had no money and needed more goods.When Aldrich brought an action to enforce the note,Donovan claimed that the note was not bindingbecause it had been obtained by economic duress.Was he correct? [Aldrich & Co. v. Donovan, 778 P.2d397 (Mont.)"
Answer and Explanation:
Economic duress happens when one party X in a contract makes demands from the other party Y which party Y has to fulfill or party X terminates the contract.
No there was no economic duress here since Aldrich had a right to demand that Donovan sign a promissory note in order to protect his claim in case of default from Donovan. Therefore Donovan signed not because he was under duress but because he needed financial assistance.
Bates Company plans to add a new item to its line of consumer product offerings. Two possible products are under consideration. Each unit of Product A costs $10 to produce and has a contribution margin of $5, while each unit of Product B costs $18 and has a contribution margin of $6. What is the differential revenue for this decision
Answer:
the Differential revenue is $9
Explanation:
The computation of the differential revenue is shown below:
Differential revenue is
= (Product B) - (Product A)
= (Cost + contribution margin) - (Cost + contribution margin)
= ($18 + $6) - ($10 + $5)
= $24 - $15
= $9
hence, the Differential revenue is $9
Therefore the same is to be considered
We simply applied the above formula
Direct Materials Purchases Budget Pasadena Candle Inc. budgeted production of 775,000 candles for the January. Wax is required to produce a candle. Assume 11 ounces of wax is required for each candle. The estimated January 1 wax inventory is 17,900 pounds. The desired January 31 wax inventory is 14,300 pounds. If candle wax costs $1.80 per pound, determine the direct materials purchases budget for January. (One pound = 16 ounces.) Round all computed answers to the nearest whole number. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Pasadena Candle Inc. Direct Materials Purchases Budget For the Month Ending January 31 Pounds of wax required for production: Total units available Total pounds to be purchased Unit price $ Total direct materials to be purchased in January $
Answer:
952,583
Explanation:
Note: The desired December 31 wax inventory is 14,300 pounds. If candle wax costs $1.80 per pound, determine the direct materials purchases budget for January is the correct words
Pasadena Candle Inc.
Direct Materials Purchases Budget
For the Year Ending December 31
Pounds of wax required for production:
Candles (775,000*11/16) 532,813
Add: Desired ending inventory, 14,300
December 31
Total units available 547113
Less :Estimated beginning inventory, 17,900
January 1
Total pounds to be purchased 529,213
Total direct materials to be purchased = Total pounds to be purchased * Unit price
Total direct materials to be purchased = 529,213 * $1.80
Total direct materials to be purchased = 952,583
Joe is considering 2 similar bonds, with the only difference that: (1) a tax-exempt municipal bond promises a 5.625% annual return, (2) a taxable corporate bond promises a 7.5% annual return. If Joe's tax rate is 25%, which bond should he buy?
a. Either one, both have the same after-tax yield
b. Municipal bond, as it has a higher after-tax yield
c. Corporate bond, as it has a higher after-tax yield
d. Not enough information is given to answer the question
Answer:
a. Either one, both have the same after-tax yield
Explanation:
we have to calculate the after tax return of the bonds:
after tax return of corporate bonds = bond yield x (1 - tax rate) = 7.5% x (1 - 25%) = 7.5% x 0.75 = 5.625%
since municipal bonds are not included as part of Joe's gross income, their after tax rate is equal to their yield = 5.625%
both bonds yield the same after tax return = 5.625%
If a check correctly written and paid by the bank for $649 is incorrectly recorded on the company's books for $694, the appropriate treatment on the bank reconciliation would be to
Answer: Add $45 to the book balance
Explanation:
This is a case of bank reconciliation. Bank reconciliation occurs when the account of the bank and the company or Business are compared in order to check the differences which are then reconciled.
In this case, since the check written and paid by the bank is $649 while in the company's book, it's written as $694, then a book balance of $45 is added which is the difference between $694 and $649
Lambda Computer Products competed for and won a contract to produce two prototype units of a new type of computer that is based on laser optics rather than on electronic binary bits. The first unit produced by Lambda took 5,000 hours to produce and required $250,000 worth of material, equipment usage, and supplies. The second unit took 4,250 hours and used $237,500 worth of materials, equipment usage, and supplies. Labor is $20 per hour. Use Exhibit 6.5. a. Lambda was asked to present a bid for 10 additional units as soon as the second unit was completed. Production would start immediately. What would this bid be
Answer:
$2,731,672.50
Explanation:
first unit produced by lambda took 5,000 hours to produce and required $250,000 worth of material, equipment usage, and supplies
the second unit took 4,250 hours and used $238,500 worth of materials, equipment usage, and supplies
learning rate = time needed to produce second unit / time needed to produce first unit = 4,250 hours / 5,000 hours = 85%
materials and equipment usage rate = $237,500 / $250,000 = 95%
using the attached table of cumulative values, we can determine the cumulative improvement factors needed to solve this question:
Lambda's accumulated cost for producing 10 more computers
work hours = 4,250 x 7.116 (85% and 10 units) x $20 per hour = $604,860materials and equipment = $238,500 x 8.955 (95% and 10 units) = $2,126,812.50total = $604,860 + $2,126,812.50 = $2,731,672.50Acme-Jones Corporation uses a weighted-average perpetual inventory system. August 2, 40 units were purchased at $27 per unit. August 18, 24 units were purchased at $29 per unit. August 29, 42 units were sold. What was the amount of the cost of goods sold for this sale?
Answer:Cost of goods sold=$1,165.5
Explanation:
Using the weighted-average perpetual inventory system.
August 2 =40 units x $27per unit = $1080
August 18=24units x $29 per unit = $696
Weighted average cost per unit = (1080 + 696)/64 = $27.75per unit
Therefore, Cost of goods sold = $27.75 x 42 = $1,165.5