Answer:
Vulcan Service Co.
a. Journal Entries:
Debit Accounts Receivable $82,000
Credit Service Revenue $82,000
To record services rendered on account.
Debit Cash $49,200
Credit Accounts Receivable $49,200
To record cash collected on account.
Debit Salaries Expense $30,000
Credit Cash $30,000
To record salaries expense for the year.
2. Debit Bad Debts Expense $2,456.72
Credit Allowance for Uncollectible $2,456.72
To record bad debts expense.
b. Income Statement for year ended December 31, Year 1:
Service Revenue $82,000
Salaries Expense 30,000
Bad Debts expense 2,456.72 32,456.72
Net income $49,543.28
c. The net realizable value of the accounts receivable at December 31, Year 1 is:
Accounts Receivable = $32,800
less Allowance for
uncollectibles 2,456.72
Net realizable value = $30,343.28
Explanation:
a) Data and Calculations:
Accounts Receivable
Account Titles Debit Credit
Service Revenue $82,000
Cash $49,200
Balance 32,800
Service Revenue
Account Titles Debit Credit
Accounts receivable $82,000
Salaries Expense
Account Titles Debit Credit
Cash $30,000
Bad Debts Expense
Account Titles Debit Credit
Allowance for Collectibles $2,456.72
Allowance for Uncollectibles
Account Titles Debit Credit
Bad Debts expense $2,456.72
Cash Account
Account Titles Debit Credit
Accounts receivable $49,200
Salaries expense $30,000
Balance 19,200
Trial Balance as at Year 1:
Account Titles Debit Credit
Cash $19,200
Accounts Receivable 32,800
Allowance for Uncollectibles $2,456.72
Service Revenue 82,000
Salaries Expense 30,000
Bad Debts expense 2,456.72
Totals $84,456.72 $84,456.72
Accounts receivable aging schedule:
Number of Percent Likely to
Days Past Due Amount Be Uncollectible Allowance Balance
Current $ 24,272 .01 $242.72
0-30 1,640 .05 82.00
31-60 2,296 .10 229.60
61-90 1,968 .30 590.40
Over 90 days 2,624 .50 1,312.00
Total $32,800 $2,456.72
The B2C salesperson's goal in the approach step is to be_____ and ________.
Answer:
Friendly knowledgeable
Explanation:
What is the most money that an investor could lose if they buy 40 shares of electriccarco for $25/share
Answer:
$300
Explanation:
How should you prepare for a behavioral-based interview?
Review as many interview questions as possible
O Have a list of example stories
O Make up answers in advance for questions you don't have experience with
Preparation is not possible for behavioral interviews
Answer:
O Have a list of example stories
Explanation:
Behavioral-based interview is distinct from the traditional form of interview. In this type of interview, the behavior, performance and real achievements of the candidate are considered. The experiences of the candidate and the list of examples of past situations are analyzed. The problem-solving nature and the pressure handling techniques of the candidate helps in enhancing the possibility of getting the job. references from the past life experiences and rea life examples helps the recruiter build confidence on the candidate.
CalMark is a privately held company, so there is no information about beta available. However, a company in the same business with a debt to equity ratio the same as that of CalMark is publicly traded and has a beta which is two times that of the market. If the risk free rate is 4%, and the market risk premium is 5%, what is the estimated cost of existing equity for CalMark
Answer:
r - Calmark = 14%
Explanation:
Based on the comparative company analysis and using the CAPM we can calculate the required rate of return for CalMark. The comparative company analysis means to use the companies similar to the subject company to assume various ratios and factor about the subject company.
The formula to calculate the cost of equity which is also known as the required rate of return (r) is,
r = rRF + Beta * rpM
Where,
rRF is the risk free raterpM is the market risk premiumThe beta for market is always equal to 1. So a beta twice of the market will be 2.
r - Calmark = 4% + 2 * 5%
r - Calmark = 14%
Let D0 and S0 be the initial demand and supply curves for gasoline. Let P* and Q* be the initial equilibrium in this market. There is an increase in incomes due to a technology boom. Which ONE of the following correctly captures the effect of this change on the market for gasoline? Question 3 options: Both equilibrium quantity and price will increase Both equilibrium quantity and price will decrease Equilibrium quantity will increase, but equilibrium price will decrease Equilibrium quantity will decrease, but equilibrium price will increase
Answer: Both equilibrium quantity and price will increase
Explanation:
If there is an increase in income, it means that people can afford to buy more gasoline or rather will buy more things that need gasoline such as cars.
The demand for gasoline will therefore go up and shift the demand curve to the right. The demand curve will then intersect with the supply curve at a higher equilibrium price and quantity.
Diversity increases the importance of
Answer:
Diversity increases an organization's capacity to meet the needs of a diverse society.
A diverse workplace reflects the population it serves, making it more effective.
Increasing diversity in the organization leads to greater creativity and gives better results.
Kinetic Company estimates that overhead costs for the next year will be $1,600,000 for indirect labor and $400,000 for factory utilities. The company uses direct labor hours as its overhead allocation base, and plans to use 50,000 direct labor hours for this next year. If a product uses 5 direct labor hours, then it will be assigned $200 in overhead costs.a. True
b. False
Answer:
The correct answer is "False".
Explanation:
The given values are:
Indirect labor,
= $1,600,000
Factory utilities,
= $400,000
Direct labor hours,
= $50,000
Now,
The plantwide overhead rate will be:
= [tex]\frac{Indirect \ labor +Factory \ utilities}{Direct \ labor \ hours}[/tex]
On substituting the values, we get
= [tex]\frac{1,600,000+400,000}{50,000}[/tex]
= [tex]\frac{2,000,000}{50,000}[/tex]
= [tex]40[/tex] ($) direct labor per hour
Thus the above is the right response.
Question 5 (10 points)
When you are doing employment planning, what sources of information would you
use to help develop your startegy? Explain.
Three years ago, you purchased some 5-year MACRS equipment at a cost of $135,000. The MACRS rates are 20 percent, 32 percent, 19.2 percent, 11.52 percent, 11.52 percent, and 5.76 percent for Years 1 to 6, respectively. You sold the equipment today for $82,500. Which of these statements is correct if your tax rate is 23 percent and you ignore bonus depreciation?
a. The tax refund from the sale is $13,219.20.
b. The book value today is $40,478.
c. The taxable amount on the sale is $47,380.
d. The tax due on the sale is $14,830.80.
e. The book value today is $37,320.
Answer:
d. The tax due on the sale is $14,830.80
Explanation:
Calculation to Determine Which of these statements is correct if your tax rate is 34 percent
First step is to calculate the Book value
Book value = $135,000 × (1 −.20 −.32 −.192)
Book value= $38,880
Second step is to calculate the Taxable amount
Taxable amount = $82,500 - 38,880
Taxable amount = $43,620
Now let calculate the tax due on the sale
Tax = $43,620 × .34
Tax= $14,830.80
Therefore The statements that is correct if your tax rate is 34 percent will be :
The tax due on the sale is $14,830.80
The Goodyear Tire & Rubber Company’s December 31, 2016 financial statements reported the following (in millions): Total assets $16,511 Total liabilities 11,786 Total shareholders’ equity 4,725 Dividends 82 Net income (loss) 1,264 Retained earnings, December 31, 2015 4,570 What did Goodyear report for retained earnings at December 31, 2016?
Answer:
$5,752
Explanation:
Calculation for What did Goodyear report for retained earnings at December 31, 2016
Using this formula
Retained earnings at December 31, 2016=Beginning retained earnings + Net income - Dividends
Let plug in the formula
Retained earnings at December 31, 2016=$4,570 + $1,264 - $82
Retained earnings at December 31, 2016=$5,752
Therefore What did Goodyear report for retained earnings at December 31, 2016 is $5,752
Tom got a 30 year fully amortizing FRM for $1,500,000 at 6%, with constant monthly payments. After 3 years of payments, rates fall and he can get a 27 year FRM at 5%, but he must pay 2 points and $1000 in closing costs to get the new loan. Think of the refinancing decision as an investment for Tom, he pays a fee now but saves money in the future in the form of lower payments. What is the annualized IRR of refinancing for Tom assuming he pays through maturity?
Answer:
Answer is explained in the explanation section below.
Explanation:
Solution:
Note: In this question, Cash Flow table is used as well, which I have attached below. Please refer to that table as well.
Monthly payment for the 30 year FRM loan:
PV = 1,500,000; r (monthly interest rate) = 6%/12 = 0.5%; n (number of monthly payments) = 30*12 = 360
PMT (monthly payment) = [tex]\frac{r . PV}{1-(1+r)^{-n} }[/tex]
PMT (monthly payment) = = (0.5%*1,500,000)/(1 -(1+0.5%)^-360) = 8,993.26
Balance remaining after 8 years (if refinancing is not done):
PMT = 8,993.26; r = 0.5%; n = 360 - (8*12) = 264
PV = PMT*(1 - (1+r)^-n)/r = 8,993.26*(1 - (1+0.5%)^-264)/0.5%
PV = 1,316,585.31
Balance remaining after 3 years (if refinancing is done):
PMT = 8,993.26; r = 0.5%; n = 360 - (3*12) = 324
PV = PMT*(1 - (1+r)^-n)/r = 8,993.26*(1 - (1+0.5%)^-324)/0.5%
PV = 1,441,261.05
Cost of refinancing = 2%*remaining balance + 1,000 = (2%*1,441,261.05) + 1,000
Cost of refinancing = 29,825.22
Monthly payment (if refinancing is done):
PV = 1,441,261.05; r = 5%/12 = 0.4167%; n = 27*12 = 324
PMT = (1,441,261.05*0.4167%)/(1 -(1+0.4167%)^-324)
PMT = 8,114.86
Balance remaining after 5 years (after refinancing):
PMT = 8,114.86; r = 0.4167%; n = 22*12 = 264
PV = 8,114.86*(1-(1+0.4167%)^-264)/0.4167%
PV = 1,297,794.91
Note: Cash flow table is attached below.
Using financial calculator:
CF0 = -29,825.22;
CF1 = 878.40; N0 = 59 (5 years less one month);
CF2 = 19,668.80; N2 = 1, solve for IRR.
IRR = 2.69%
Hence,
Annual IRR = 2.69%*12 = 32.29%
On October 1, 2018, Jarvis Co. sold inventory to a customer in a foreign country, denominated in 100,000 local currency units (LCU).Collection is expected in four months. On October 1, 2018, a forward exchange contract was acquired whereby Jarvis Co. was to pay 100,000 LCU in four months (on February 1, 2019) and receive $78,000 in U.S. dollars. The spot and forward rates for the LCU were as follows:
Rate DescriptionExchange Rate .83-1 LCU 5.85 1 LCU Spot rate: Spot rate: 1-Month Forward Rate $.be = 1 LCU Spot rate: October 1, 2018 December 31, 2018 February 1, 2019 .86 1 LCU The,company's borrowing rate is 12%. The present value factor for one month is .9901. Any discount or premium on the contract is amortized using the straight-line method , Assuming this is a cash flow hedge:
prepare journal entries for this sales transaction and forward contract.
Answer:
10/1/2018
Dr Accounts receivable $83,000
Cr Sales $83,000
12/31/2018
Dr Accounts receivable $2,000
Cr Foreign exchange gain $2,000
12/31/2018
Dr Loss on forward contract $1,980
Cr Forward contract $1,980
2/1/2018
Accounts receivable $1000
Cr Foreign exchange gain $1000
2/1/2018
Dr Loss on forward contract $6,020
Cr Forward contract $6,020
2/1/2018
Dr Foreign currency
$86,000
Accounts receivable $86,000
2/1/2018
Dr Cash $78,000
Dr Forward contract $8,000
Cr Foreign currency $86,000
Explanation:
Preparation of the journal entries for the sales transaction and forward contract.
10/1/2018
Dr Accounts receivable (100000*0.83) $83,000
Cr Sales $83,000
12/31/2018
Dr Accounts receivable $2,000
[100,000*(0.85-0.83)]
Cr Foreign exchange gain $2,000
12/31/2018
Dr Loss on forward contract $1,980
[((0.80-0.78)*100000)*2000*0.9901]
Cr Forward contract $1,980
2/1/2018
Accounts receivable $1000
[100000*(0.86-0.85)]
Cr Foreign exchange gain $1000
2/1/2018
Dr Loss on forward contract $6,020
(78000/100000 = 0.78)
[ ((0.78-0.86)*100000) = 8000-1980=6020]
Cr Forward contract $6,020
2/1/2018
Dr Foreign currency (100000*0.86)
$86,000
Accounts receivable $86,000
2/1/2018
Dr Cash $78,000
Dr Forward contract $8,000
($86,000-$78,000)
Cr Foreign currency (100000*0.86) $86,000
In general, improvements in technology that is used to produce a good will result in ___________.
a decrease in supply
a shortage of the good
an increase in supply
higher operating costs
Answer:
first one
Explanation:
because I am a teacher and I know this
Vernon Boat Company makes inexpensive aluminum fishing boats. Production is seasonal, with considerable activity occurring in the spring and summer. Sales and production tend to decline in the fall and winter months. During year 2, the high point in activity occurred in June when it produced 209 boats at a total cost of $154,800. The low point in production occurred in January when it produced 31 boats at a total cost of $48,000. Required Use the high-low method to estimate the amount of fixed cost incurred each month by Vernon Boat Company. Determine the total estimated cost if 110 boats are made.
Answer:
Total cost= $95,400
Explanation:
First, we need to calculate the unitary and fixed costs using the high-low method:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (154,800 - 48,000) / (209 - 31)
Variable cost per unit= $600
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 154,800 - (600*209)
Fixed costs= $29,400
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 48,000 - (600*31)
Fixed costs= $29,400
Now, the total cost for 110 boats:
Total cost= 29,400 + 110*600
Total cost= $95,400
On June 1, 2021, Emmet Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2021. Under the terms of the contract, Emmet will be paid a fixed fee of $60,000 per year and will receive an additional 10% of the fixed fee at the end of each year provided that building occupancy exceeds 80%. Emmet estimates a 25% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract. Assume that Emmet accrues revenue each month, and estimates variable consideration as the most likely amount. On November 1, Emmet revises its estimate of the chance the building will exceed the 80% occupancy threshold to a 60% chance. What is the total amount of revenue Emmet should recognize on this contract in November of 2021
Answer:
$7,500
Explanation:
Calculation to determine the total amount of revenue Emmet should recognize on this contract in November of 2021
First step is to calculate the revenue amount recognized for July, August, September, and October
Recognized revenue =$60,000 × 4/12
Recognized revenue = $20,000
(July, August, September, and October=4 months )
Second step is to calculate the revenue amount to be recognized at the beginning of November
Recognized revenue= $60,000 + ($60,000 × 10%)
Recognized revenue= $66,000
Third step is to calculate the revenue amount recognized at the end of November
Recognized revenue=$66,000 × 5/12
Recognized revenue = $27,500
Now let calculate the total amount of revenue Emmet should recognize on this contract in November of 2021
Total Recognized revenue=$27,500 - $20,000
Total Recognized revenue=$7,500
Therefore the total amount of revenue Emmet should recognize on this contract in November of 2021 will be $7,500
Perhaps you think it will be easy to make responsible decisions regarding auto loans in your future . But , decision making can be tricky when you're considering your dream car. Follow the directions on the sheet to complete the activity
Answer:
From this worksheet, I have noticed that following directions to receive your dream car is tricky as well as fun
;)
Information related to Blue Spruce Corp. is presented below.1.
1. On April 5, purchased merchandise on account from Whispering Winds Company for $44,800, terms 4/10, net/30, FOB shipping point.
2. On April 6, paid freight costs of $830 on merchandise purchased from Whispering Winds.
3. On April 7, purchased equipment on account for $42,500.
4. On April 8, returned damaged merchandise to Whispering Winds Company and was granted a $4,600 credit for returned merchandise.
5. On April 15, paid the amount due to Whispering Winds Company in full.
Required:
Prepare journal entries to record these transactions on the books of Lor Co. using a periodic inventory system.
Answer:
April 5
Dr Inventory $44,800
Cr Accounts Payable $44,800
April 6
Dr Inventory $830
Cr Cash $830
April 7
Dr Equipment $42,500
Cr Accounts Payable $42,500
Dr Accounts Payable $4,600
Cr Inventory credit $4,600
On April 15
Dr Accounts Payable (Inventory before discounts) credit 40200
($44,800 - $4,600)
Cr Cash (Inventory after discounts) credit 38592
Cr 40200-1608)
Cr Inventory (discounts) 1608
(40200 * 0.04 )
Explanation:
Preparation of journal entries to record these transactions on the books of Lor Co. using a periodic inventory system.
April 5
Dr Inventory $44,800
Cr Accounts Payable $44,800
April 6
Dr Inventory $830
Cr Cash $830
April 7
Dr Equipment $42,500
Cr Accounts Payable $42,500
Dr Accounts Payable $4,600
Cr Inventory credit $4,600
On April 15
Dr Accounts Payable (Inventory before discounts) credit 40200
($44,800 - $4,600)
Cr Cash (Inventory after discounts) credit 38592
Cr 40200-1608)
Cr Inventory (discounts) 1608
(40200 * 0.04 )
Since a cell phone is a private good, if Neha chooses to spend $300 on a cell phone, Neha would get $300 of benefit from the cell phone and Teresa wouldn't receive any benefit from Neha's choice. If Neha still spends $300 on a cell phone and Teresa chooses to contribute $300 to the public park, Neha would still receive the $270 of benefit from Teresa's generosity. In other words, if Neha decides to keep the $300 for a cell phone and Teresa decides to contribute the $300 to the public project, then Neha would receive a total benefit of $300 $270
Answer:
In other words, if Neha decides to keep the $300 for a cell phone and Teresa decides to contribute the $300 to the public project, then Neha would receive a total benefit of:
$570.
Explanation:
Neha has, in this situation, maximized his benefits to the detriment of the public good. This is an illustration of the tragedy of the commons. The tragedy of the common is an economic problem that explains the loss that the society incurs when some persons like Neha neglect to contribute to the common good because they are solely concentrated on pursuing their individual goals for personal gains.
Refinancing a loan. About Suppose someone takes out a home improvement loan for $30,000. The annual interest on the loan is 6% and is compounded monthly. The monthly payment is $600. Let an denote the amount owed at the end of the nth month. The payments start in the first month and are due the last day of every month.
(a) Give a recurrence relation for an. Don't forget the base case.
(b) Suppose that the borrower would like a lower monthly payment. How large does the monthly payment need to be to ensure that the amount owed decreases every month? Feedback?
Answer:
[tex](a)[/tex] [tex]A_n = A_{n-1}(1.005) - 600[/tex] where [tex]A_0 = 30000[/tex]
(b) Above $150
Explanation:
Given
[tex]Loan = \$30000[/tex]
[tex]Rate =6\%[/tex] --- annually
Solving (a): Recursion for the amount at the end of n month
The base case is:
[tex]A(0) = 30000[/tex]
Next, we calculate the monthly rate (r)
[tex]r = \frac{Annual\ Rate}{12}[/tex]
[tex]r = \frac{6\%}{12}[/tex]
[tex]r = 0.5\%[/tex]
[tex]r = 0.005[/tex]
The loan amount remaining at the end of month n is then calculated as:
[tex]A_n = A_{n-1}*(1 + r) - 600[/tex] ---[The 600 represents the monthly payment]
[tex]A_n = A_{n-1}*(1 + 0.005) - 600[/tex]
[tex]A_n = A_{n-1}(1.005) - 600[/tex]
Solving (b):
Suppose the borrower requests for a lower monthly payment, then the following condition will exist:
[tex]P > A_{n-1} *0.005[/tex]
i.e. the monthly payment will exceed the monthly interest
Let [tex]n= 1[/tex]
[tex]P > A_{1-1} *0.005[/tex]
[tex]P > A_0 *0.005[/tex]
Substitute 30000 for [tex]A_0[/tex]
[tex]P > 30000 *0.005[/tex]
[tex]P > 150[/tex]
His monthly payment must exceed $150
what is a bond? in your own words. economics.
Answer:
A bond is simply a loan taken out by a company. Instead of going to a bank, the company gets the money from investors who buy its bonds. In exchange for the capital, the company pays an interest coupon, which is the annual interest rate paid on a bond expressed as a percentage of the face value.
Explanation:
Answer:
A bond is a fixed income Instrument that represents a loan made by investors to a borrower ( typically corporate or governmental).
The Griffins own a mountain cabin that is used for both personal and rental purposes. In the current year, the Griffins rented the cabin out for 150 days and used it personally for 50 days. Assume that the Griffins itemize their deductions. Which of the following statements regarding the treatment of the mountain cabin on the Griffins' tax return is true?
A. 100% of the utilities for the mountain cabin for the entire year are deductible.
B. Depreciation is deductible under all rental circumstances.
C. Real estate taxes are deductible under all rental circumstances.
D. The rental income received is not included in gross income.
Answer:
a. lebron james 123456789101121314151617181920
a. Which of the following items might you include in the basket of goods and services for the average student? The basket should include:______
a. cafeteria meals.
b. washing machines.
c. textbooks.
d. pens.
b. One of the primary expenses in a student’s basket is tuition, which is also included in the BLS calculation of the CPI. Consider the portion of total expenditure tuition accounts for in a student's budget versus a typical household's budget. Given that difference, the value of the student's basket over time has likely changed ________than the CPI.
Answer:
A. a. cafeteria meals.
c. textbooks.
d. pens.
B. More
Explanation:
Students use textbooks and pens at school to study and take down notes. They also go to the cafeteria at meal times to eat. A student does not directly need a washing machine to be a student so the options are cafeteria meals, textbooks and pens.
Overtime, tuition fees have ballooned and are now much higher than they used to be. Students therefore spend a significant amount of their budget on tuition as opposed to Households. It can therefore be said that student's basket overtime has likely changes more than the CPI.
Determine whether each of the following goods is a private good, a public good, a common resource, or a club good. Private Good Public Good Common Resource Club Good A stationary bike in a fitness room that is open to the public A large, beautiful statue in a town square A new Ferrari that you use to drive your friends around town
Answer:
COMMON RESOURCE
PUBLIC GOOD
PRIVATE GOOD
Explanation:
A ski chalet at Peak n' Peak now costs $250,000. Inflation is expected to cause this price to increase at 5 percent per year over the next 10 years before Chris and Julie retire from successful investment banking careers. How large an equal annual end-of-year deposit must be made into an account paying an annual rate of interest of 13 percent in order to buy the ski chalet upon retirement
Answer:
$22,108
Explanation:
The computation is shown below:
Required deposit each year (P) = FVA ÷ ([(1+rate of interest)^number of years-1]÷rate of interest)
= $407,224 ÷ (((1+13%)^10-1) ÷ 13%)
= $22,108
The $407,224 comes from
= $250,000 × (1+5%)^10
Victory Company uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the first process. During November, the first process transferred 755,000 units of product to the second process. Additional information for the first process follows. At the end of November, work in process inventory consists of 200,000 units that are 70% complete with respect to conversion. Beginning work in process inventory had $248,300 of direct materials and $179,000 of conversion cost. The direct material cost added in November is $1,661,700, and the conversion cost added is $3,401,000. Beginning work in process consisted of 74,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion. Of the units completed, 74,000 were from beginning work in process and 681,000 units were started and completed during the period.
A. Compute both the direct material cost and the conversion cost per equivalent unit.
B. Compute the direct material cost and the conversion cost assigned to units completed and transferred out and ending work in process inventory.
Answer:
Victory Company
Materials Conversion
A. Cost per equivalent unit $2.00 $4.01
B. Costs assigned to:
i. Units completed and transferred out $1,510,000 $3,027,550
ii. Ending work in process inventory $400,000 $561,400
Explanation:
a) Data and Calculations:
Units Materials Conversion Total
Beginning Work in Process 74,000 $248,300 $179,000 $427,300
Started 881,000 $1,661,700 3,401,000 5,062,700
Units completed 755,000 $1,910,000 $3,590,000 $5,490,000
Ending Work in Process 200,000
Equivalent units:
Started and Completed 755,000 755,000 755,000 (100%)
Ending work in Process 200,000 200,000 140,000 (70%)
Equivalent units 955,000 895,000
Cost per equivalent unit
Total production costs $1,910,000 $3,590,000
Equivalent units 955,000 895,000
Cost per equivalent unit $2.00 $4.01
Cost assigned to:
Units completed and transferred out:
Materials = $1,510,000 ($2 * 755,000)
Conversion = 3,027,550 ($4.01 * 755,000)
Total $4,537,550
Ending Work in Process Inventory:
Materials = $400,000 ($2 * 200,000)
Conversion = 561,400 ($4.01 * 140,000)
Total $961,400
On January 1, 2021, LLB Industries borrowed $200,000 from Trust Bank by issuing a two-year, 10% note, with interest payable quarterly. LLB entered into a two-year interest rate swap agreement on January 1, 2021, and designated the swap as a fair value hedge. Its intent was to hedge the risk that general interest rates will decline, causing the fair value of its debt to increase. The agreement called for the company to receive payment based on a 10% fixed interest rate on a notional amount of $200,000 and to pay interest based on a floating interest rate. The contract called for cash settlement of the net interest amount quarterly. Floating (LIBOR) settlement rates were 10% at January 1, 8% at March 31, and 6% at June 30, 2021. The fair values of the swap are quotes obtained from a derivatives dealer. Those quotes and the fair values of the note are as follows: January 1 March 31 June 30 Fair value of interest rate swap 0 $ 6,472 $ 11,394 Fair value of note payable $ 200,000 $ 206,472 $ 211,394 Required: Prepare the journal entries through June 30, 2021, to record the issuance of the note, interest, and necessary adjustments for changes in fair value.
Answer:
1/01
Dr Cash $200,000
Cr To notes payable $200,000
31/03
Dr Interest expense $5,000
Cr To cash $5,000
Dr Cash $1,000
Cr To interest expense $1,000
Dr Interest rate swap (asset) $6,472
Cr Holding gain—interest rate $6,472
Dr Holding loss $6,472
Cr notes payable $6,472
30/06
Dr Interest expense $5,000
Cr To cash $5,000
Dr Cash $2,000
Cr To interest expense $2,000
Dr Interest rate swap [asset] $4,922
Cr Holding gain—interest rate swap 4,922
Dr Holding loss—hedged note $4,922
Cr Note payable $4,922
Explanation:
Preparation of the journal entries through June 30, 2021, to record the issuance of the note, interest, and necessary adjustments for changes in fair value
1/01
Dr Cash $200,000
Cr To notes payable $200,000
(To record the issuance of the note)
31/03
Dr Interest expense $5,000
Cr To cash $5,000
(200,000 * 10% * 1/4)
( To record Interest)
Dr Cash $1,000
[5,000 -(8%* 1/4 * 200,000)]
Cr To interest expense $1,000
(To record the net Cash settlement)
Dr Interest rate swap (asset) $6,472
($6,472 – 0)
Cr Holding gain—interest rate $6,472
(To record change in net value of the derivative)
Dr Holding loss $6,472
Cr notes payable $6,472
($206,472- $200,000)
(To record change in net value of the note)
30/06
Dr Interest expense $5,000
($200,000 * 10% * 1/4)
Cr To cash $5,000
(To record Interest)
Dr Cash $2,000
[$5,000-(6% * 1/4 * $200,000)
Cr To interest expense $2,000
(To record the net Cash settlement)
Dr Interest rate swap [asset] ($11,394 – 6,472)$4,922
Cr Holding gain—interest rate swap 4,922
(To record change in fair value of the derivative)
Dr Holding loss—hedged note $4,922
Cr Note payable ($211,394 – 206,472) $4,922
(To record change in fair value of the note)
The journal entries through to record the issuance of the note, interest, and necessary adjustments for changes in fair value will be:
1st January:
Dr Cash $200,000 Cr Notes payable $200,00031st March
Dr Interest expense $5,000 Cr To cash $5,000Dr Cash $1,000 Cr Interest expense $1,000Dr Interest rate swap (asset) $6,472Cr Holding gain—interest rate $6,47230 June
Dr Interest expense $5,000 Cr To cash $5,000Dr Cash $2,000Cr interest expense $2,000Dr Interest rate swap [asset] $4,922Cr Holding gain—interest rate swap 4,922Dr Holding loss—hedged note $4,922Cr Note payable $4,922It should be noted that the interest expense on 31st March was calculated as:
= 200000 × 10% × 1/4
= 5000
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Cynthia is ready to apply to a four-year private college. Evaluate her eligibility for financial ald.
Select the best answer from the choices provided.
OA. She will not be eligible to receive federal loans.
OB. She will be eligible to walve any interest on private loans.
Ос. .
She will be eligible to receive grants.
OD She will not be eligible to receive scholarships.
Answer:
C.
Explanation
A - Private schools recieve federal funds and so can their students.
B - Some private loans can waive interest, but not all.
D - any student can receive scholarships, if they qualify or if the are awarded the scholarship after applying.
Good luck in your studies.
Crisp Cookware's common stock is expected to pay a dividend of $1.75 a share at the end of this year (D1 = $1.75); its beta is 0.6. The risk-free rate is 5.8% and the market risk premium is 5%. The dividend is expected to grow at some constant rate, gL, and the stock currently sells for $80 a share. Assuming the market is in equilibrium, what does the market believe will be the stock's price at the end of 3 years (i.e., what is )? Do not round intermediate calculations. Round your answer to the nearest cent.
Answer:
P3 = $96.9425 rounded off to $96.94
Explanation:
To calculate the market price of the stock three years from today (P3), we will use the constant growth model of DDM. The constant growth model calculates the values of the stock based on the present value of the expected future dividends from the stock. The formula for price today under this model is,
P0 = D1) / (r - g)
Where,
D1 is the dividend expected for the next period g is the constant growth rate r is the required rate of return on the stock
To calculate the price of the stock today (P0), we use the dividend expected for the next period (D1). So, to calculate the price at the end of 3 years (P3) we will use D4.
We first need to calculate r using the CAPM equation. The equation is,
r = rRF + Beta * rpM
Where,
rRF is the risk free rate rpM is the market risk premium
r = 0.058 + 0.6 * 0.05
r = 0.088 or 8.8%
Using the price formula for DDM above and the values for P0, D1 and r, we can calculate the g to be,
80 = 1.75 / (0.088 - g)
80 * (0.088 - g) = 1.75
7.04 - 80g = 1.75
7.04 - 1.75 = 80g
5.29/80 = g
g = 0.066125 or 6.6125%
We first need to calculate D4.
D4 = D1 * (1+g)^3
D4 = 1.75 * (1+0.066125)^3
D4 = 2.12061793907
Using the formula from DDM for P3, we can calculate P3 to be,
P3 = 2.12061793907 / (0.088 - 0.066125)
P3 = $96.9425 rounded off to $96.94
A group of users can perform certain operations on a shared workbook. Which option helps them to update and track changes in the shared workbook?
The
option allows all group members to update information and track changes in the workbook.
Answer: Edit option allows everyone in a group to edit the contents work
Explanation:
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Which of the following is not an important factor to assess when identifying appropriate precedent transactions?
Answer:
how to answer that ?????
The factor that is not important for the identification of precedent transactions is Accretive/dilutive effect of the transaction on the acquirer. Thus, option 2nd is correct.
What is precedent transaction?Precedent transaction refers to the valuation process of the price being paid for the similar companies in the past is taken into account as a gauge of a valuation of company's value.
An estimation of a share's value in the event of an acquisition is produced through precedent transaction analysis. It is the limitation of the precedent transaction that past cost may not reflect the prevailing conditions of the market.
Therefore, it can be concluded that The accretive or dilutive effect of the acquisition on the acquirer is a criterion that is not crucial for identifying prior transactions. Hence, option 2nd is correct.
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Your question is incomplete, but most probably the full question was...
Which of the following is not an important factor to assess when identifying appropriate precedent transactions?
1) Transaction rationale
2) Accretive/dilutive effect of the transaction on the acquirer
3) Transaction size
4) Industry & financial characteristics