Answer:
The manufacturing overhead applied to work in process is:
D. $79,000
Explanation:
a) Data and Calculations:
Beginning work in process inventory 30,000
Direct materials used in production 50,000
Direct labor 60,000
Total manufacturing costs to account for 219,000
Manufacturing overhead applied to WIP 79,000 (219,000 - 140,000)
Ending work in process inventory 72,000
b) The manufacturing overhead applied to Work in Process is the difference between the total manufacturing costs to account for and the costs of beginning work in process, direct materials, and direct labor for the period. When the ending work in process is deducted from the total manufacturing costs, the resulting figure represents the cost of goods transferred to finished goods inventory.
Agreement and disagreement among economists
Suppose that Raphael, an economist from an AM talk radio program, and Susan, an economist from a nonprofit organization on the West Coast, are arguing over saving incentives. The following dialogue shows an excerpt from their debate:
Yvette: I think it's safe to say that, in general, the savings rate of households in today's economy is much lower than it really needs to be to sustain the improvement of living standards.
Sean: I think a switch from the income tax to a consumption tax would bring growth in living standards.
Yvette: You really think households would change their saving behavior enough in response to this to make a difference? Because I don't.
1. The disagreement between these economists is most likely due to (differences in values, differences in perception versus reality, differences in scientific judgments) .
2. Despite their differences, with which proposition are two economists chosen at random most likely to agree?
A. Lawyers make up an excessive percentage of elected officials.
B. Minimum wage laws do more to harm low-skilled workers than help them.
C. Tariffs and import quotas generally reduce economic welfare.
Answer:
Differences in values C. Tariffs and import quotas generally reduce economic welfare.Explanation:
Yvette and Sean most likely have a difference in values because they believe that one thing is better for the economy than the other. This means that when it comes down to the economy, they value a certain approach over other approaches.
Economist don't usually find common ground on many things but there are some things where they have a general consensus and one of them is that tariffs and import quotas are bad for the economy. They believe that people stand more to gain from free trade than restricted trade.
Identify each of the following features as applying more to job order operations, process operations or both job order and process operations.1. Cost object is a process. 2. Measures unit costs only at period-end. 3. Uses indirect costs. 4. Transfers costs between Work in Process Inventory accounts. 5. Uses only one Work in Process account. 6. Uses materials, labor, and overhead costs.
Answer:
Identification of Features Applying More to Job Order Operations, Process Operations, or Both:
Features
1. Cost object is a process. Process Operations
2. Measures unit costs only at period-end. Process Operations
3. Uses indirect costs. Both
4. Transfers costs between Work in
Process Inventory accounts. Process Operations
5. Uses only one Work in Process account. Job Operations
6. Uses materials, labor, and overhead costs. Both
Explanation:
The main difference between the two operations is the manner costs are accumulated. Job operations accumulate costs for different jobs that are not similar. Process operations accumulate costs to show the process a product passes through. The product of a process operation is not unique like the product of a job operation.
QS 4-19B Recording estimates of future discounts LO P6 ProBuilder has the following June 30 fiscal-year-end unadjusted balances: Allowance for Sales Discounts, $0; and Accounts Receivable, $10,200. Of the $10,200 of receivables, $2,100 are within a 3% discount period, meaning that it expects buyers to take $63 in future discounts arising from this period’s sales. a. Prepare the June 30 fiscal-year-end adjusting journal entry for future sales discounts.
Answer:
Dr Sales Discount $63
Cr Allowance for Sales Discount $63
Explanation:
Preparation of the June 30 fiscal-year-end adjusting journal entry for future sales discounts.
Based on the information given the June 30 fiscal-year-end adjusting journal entry for future sales discounts will be:
30-June
Dr Sales Discount $63
Cr Allowance for Sales Discount $63
(3%*$2,100)
(To record future sales discounts)
Calculate the geometric average return earned by an investor over three years if she earned 6% in the first year of an investment, 12% in the second year and 10% in the third year. 9.36% 9.27% 9.30% 9.33%
Answer:
Calculate the geometric average return earned by an investor over three years if she earned 6% in the first year of an investment, 12% in the second year and 10% in the third year. 9.36% 9.27% 9.30% 9.33%
Explanation:
Calculate the geometric average return earned by an investor over three years if she earned 6% in the first year of an investment, 12% in the second year and 10% in the third year. 9.36% 9.27% 9.30% 9.33%
9.33% is the geometric average return earned by an investor over three years if she earned 6% in the first year of investment, 12% in the second year, and 10% in the third year. The correct option is D.
What is the geometric average return in finance?The formula for the geometric average return, also known as the geometric mean return, can be used to figure out the average rate of return on an investment that is compounded over a number of time periods. The geometric average return, to put it simply, accounts for compound interest over a number of periods.
Given
Return rate = 6%, 12%, and 10% respectively in years 1, 2, and 3.
The average rate of return = Sum of All year's return / Number of Years
= 6 + 12 + 10 / 3 = 9.33%
The geometric average return is 9.33%
Thus, the ideal selection is option D.
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Suppose that you own 1,300 shares of Nocash Corp. and the company is about to pay a 25% stock dividend. The stock currently sells at $100 per share.
a. What will be the number of shares that you hold after the stock dividend is paid?
b. What will be the total value of your equity position after the stock dividend is paid?
c. What will be the number of shares that you hold if the firm splits five for four instead of paying the stock dividend?
Answer:
a. Number of shares held after stock dividend:
= Current number of shares + (Current number of shares * Stock dividend percentage)
= 1,300 + ( 1,300 * 25%)
= 1,300 + 325
= 1,625 shares
b. Total value of equity position after stock dividend:
Stock dividend does not change the market value of equity as it reduces the price of each stock so the total value will be the same as before the stock dividend:
= 1,300 * 100
= $130,000
c. Number of shares if shares are split:
= Number of shares * split percentage
= 1,300 * 5/4
= 1,625 shares
In comparing the deviations of returns, which one of the following assets has historically had the largest standard deviation of annual returns?
a. large company stocks
b. long-term corporate bonds
c. long-term government bonds
d. U.S. Treasury bills
Answer:
A
Explanation:
What is the beta for a 2 stock portfolio with a 0.43 weight in Walmart stock and the remainder in Amazon
Answer: 0.82
Explanation:
From the given formulas, the beta of Walmart is 0.3616 and the beta of Amazon is 1.1634.
The portfolio beta is going to be a weighted average of these two betas:
= (0.43 * 0.3616) + ( (1 - 0.43) * 1.1634)
= 0.155488 + 0.663138
= 0.82
Costs associated with two alternatives, code-named Q and R, being considered by Albiston Corporation are listed below: Alternative Q Alternative R Supplies costs$79,000 $79,000 Power costs$36,600 $35,600 Inspection costs$32,000 $35,600 Assembly costs$48,000 $48,000 Required: a. Which costs are relevant and which are not relevant in the choice between these two alternatives
Answer:
Albiston Corporation
Relevant and Irrelevant Costs:
Relevant Costs:
Alternative Q Alternative R
Power costs $36,600 $35,600
Inspection costs $32,000 $35,600
Irrelevant Costs:
Alternative Q Alternative R
Supplies costs $79,000 $79,000
Assembly costs $48,000 $48,000
Explanation:
a) Data and Comparisons:
Alternative Q Alternative R
Supplies costs $79,000 $79,000
Power costs $36,600 $35,600
Inspection costs $32,000 $35,600
Assembly costs $48,000 $48,000
b) Relevant costs make a difference in the choice between alternative Q or R. The costs that are the same in amount are not relevant. Supplies costs and Assembly costs are two irrelevant costs, while Power costs and Inspection costs are relevant because they are not the same under the two alternatives. They make a difference in the choice of each alternative.
Each scenario below gives some information about price elasticity of demand for a firm. Use this information to answer the questions.
Honest Abe's Used Cars estimates the price elasticity of demand for their cars to be 5.10. Last month, Abe tried a new marketing scheme which decreased the number of cars sold by 57%.
Abe must have___prices. Abe's prices must have changed by___. Therefore, Abe's total revenue____.
At Webs-R-Us, a website design company, the new manager has decided to increase the price of Webs-R-Us services by 45%. If Webs-R-Us has a price elasticity of demand at 0.70, we can expected the number of websites designed to____. Therefore, Webs-R-Us's total revenue will The number of websites will change by_____.
Answer:
Increased
2.907%
decreased
decrease
increase
0.64
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
Price elasticity of demand = percentage change in quantity demanded / percentage change in price
Abe's elasticity of demand is elastic because it has a value greater than 1.
if quantity demanded decreases, it means that price must have been increased. this would lead to a decrease in total revenue
If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.
Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one
Demand is unit elastic if a small change in price has an equal and proportionate effect on quantity demanded.
Infinitely elastic demand is perfectly elastic demand. Demand falls to zero when price increases
Perfectly inelastic demand is demand where there is no change in the quantity demanded regardless of changes in price.
A company purchased a weaving machine for $198,250. The machine has a useful life of 8 years and a residual value of $10,500. It is estimated that the machine could produce 751,000 bolts of woven fabric over its useful life. In the first year, 105,500 bolts were produced. In the second year, production increased to 109,500 units. Using the units-of-production method, what is the amount of depreciation expense that should be recorded for the second year
Answer:
the depreciation expense that should be recorded for the second year is $27,375
Explanation:
The computation of the amount of depreciation expense that should be recorded for the second year is shown below
Depreciation rate is
= ($198,250 - $10,500) ÷ 751000
= 0.25 per bolt
Now Depreciation expense for the second year
= $109,500 × .25
= $27,375
hence, the depreciation expense that should be recorded for the second year is $27,375
The following data were taken from the records of Menendez Company:
Current assets $5,000
Property, plant, and equipment 10,000
Current liabilities 3,500
Long-term liabilities 5,000
Stockholders' equity 6,500
What is Menendez Company's working capital?
a. $1,500
b. $5,000
c.1.00
d. $6,500
Answer: a. $1,500
Explanation:
Working capital is calculated by deducting current liabilities from current assets. It is meant to show the operating liquidity of a company within a period.
Working capital = Current assets - Current liabilities
= 5,000 - 3,500
= $1,500
Preparation of a statement of cash flows involves five steps:
(1) Compute the net increase or decrease in cash;
(2) compute net cash provided or used by operating activities (using either the direct or indirect method);
(3) compute net cash provided or used by investing activities;
(4) compute net cash provided or used by financing activities; and
(5) report the beginning and ending cash balances and prove that the ending cash balance is explained by net cash flows. Noncash investing and financing activities are also disclosed.
Answer:
Preparation of a statement of cash flows involves five steps
1. Compute net cash provided or used by operating activities.
This is the section where all the cash flow that belongs to the operating section are been added and subtracted according to the inflow and outflow of the transaction.
2. Compute net cash provided or used by investing activities.
This is the section where all the cash flow that belongs to the investing section are been added and subtracted according to the inflow and outflow of the transaction.
3. Compute net cash provided or used by financing activities.
This is the section where all the cash flow that belongs to the financing section are been added and subtracted according to the inflow and outflow of the transaction.
4. Compute the net increase or decrease in cash
This is the section where the cash-flow from operating, investing and financing activities is been balanced.
5. Report the beginning and ending cash balances and prove that the ending cash balance is explained by net cash flows.
After the cash-flow from operating, investing and financing activities is been calculated, Then, this section is also computed to derive the Closing/Ending cash balance
In its first year of operations, Roger Company purchased trading securities at a total cost of $53,000. On December 31, the end of Roger's fiscal year, the fair market value of those investments totaled $57,000. As a result of these investments, Roger Company will report
Answer:
Investment in Trading Securities of $57,000
Explanation:
Based On the information given we were told that the FAIR MARKET VALUE of those investments totaled the amount of $57,000 which therefore means that As a result of these investments, Roger Company will report INVESTMENT IN TRADING SECURITIES of the amount of $57,000.
The Cavendish Company is considering a project with an initial investment of $8 million that has an accounting rate of return of 25%. The project will generate an annual net cash flow of $1.75 million and annual net operating income of $2 million. What is the project's payback period?
Answer:
4 years and 2 months
Explanation:
The project's payback period is the length of time that the future cash flows take to equal the initial investment of the project.
Initial Investment = $8 million
Annual cash flows = $1.75 million
It will take 4 years and 2 months ($1 million /$8 million x 12) for annual cashflows to equal the Initial Investment of $8 million.
Marquis Company uses a weighted-average perpetual inventory system.
August 2 10 units were purchased at $12 per unit.
August 18 15 units were purchased at $14 per unit.
August 29 12 units were sold.
What is the amount of the cost of goods sold for this sale?
a. $121.38.b. $106.00.c. $160.00.
Answer:
The correct answer is "$136.44"
Explanation:
According to the question,
Total units will be:
= [tex]10 \ unit+15 \ unit[/tex]
= [tex]25 \ unit[/tex]
Average cost will be:
= [tex]\frac{[(10\times 12)+(15\times 14)]}{29}[/tex]
= [tex]\frac{120+210}{29}[/tex]
= [tex]\frac{330}{29}[/tex]
= [tex]11.38[/tex] ($)
hence,
The cost of sale will be:
= [tex]Units \ sold\times Average \ cost[/tex]
= [tex]12\times 11.38[/tex]
= [tex]136.44[/tex] ($)
In June 2007 General Motors (GM) posted a price-earnings ratio of 9.84. If
the price of the stock at that time was $36 per share, which of the following
must have been true?
a. GMâs earnings per share was 3.66.
b. GMâs coupon payment was $35 per year.
c. GMâs dividend yield for the year was 26%.
d. GMâs revenues that month were $366 million.
Answer:
General Motors (GM)
If the price of the stock at that time was $36 per share, the true statement is:
a. GM's earnings per share was 3.66.
Explanation:
a) Data and Calculations:
Price-earnings ratio = 9.84
Market price of stock at that time = $36 per share
Earnings per share = Market price per share/Price-earnings ratio
= $36/9.84 = 3.659
= $3.66
Check:
Price-earnings ratio = Market price per share/Earnings per share
= 9.84 ($36/$3.66)
Purple Lemon Fruit Company has two divisions: one is very risky, and the other exhibits significantly less risk. The company uses its investors’ overall required rate of return to evaluate its investment projects. It is most likely that the firm will become:
Answer: b. Riskier over time, and its value will decrease
Explanation:
Because the company is using the investor's required rate of return instead of one that takes into account the riskiness of the two division, you find that risk is not being adequately accounted for.
This would lead to a situation where the company becomes riskier because it is not accounting for its risk properly. With higher risk, the company will be unable to seek funding easily which would lead to lower investments being undertaken and an overall decrease in company value.
Daphne has received job offers in six different cities across the United States. The table below shows the nominal wage she is being offered in each city and the average monthly rent for an apartment in each city. a. Calculate Daphne’s real wage in terms of how many months of rent her wage could purchase in each city and complete the “Real Wage” column in the table below.
When moving up along an existing supply curve, all variables other than price are
O increasing
decreasing
O held constant
O fluctuating
When moving up along an existing supply curve, all variables other than price are held constant. Hence, Option (C) is correct.
When analyzing a supply curve, economists typically assume that all other variables except price remain constant.
This assumption allows for a simplified analysis of the relationship between price and quantity supplied, isolating the impact of price changes on supply.
In reality, numerous factors influence supply, such as input costs, technology, government regulations, and producer expectations.
However, when studying the impact of price on supply, economists use the concept of ceteris paribus (all other things being equal) to hold these other factors constant and focus solely on the relationship between price and quantity supplied.
Thus, by assuming that all other variables are constant, economists can create a simplified model that helps understand the basic behavior of supply and the upward-sloping nature of the supply curve.
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When moving up along an existing supply curve, all variables other than price are
A) increasing
B) decreasing
C) held constant
D) fluctuating
The common stock of Alpha Manufacturers has a beta of 1.14 and an actual expected return of 15.26 percent. The risk-free rate of return is 4.3 percent and the market rate of return is 12.01 percent. Which one of the following statements is true given this information? To be correctly priced according to CAPM, the stock should have an expected return of 21.95 percent.
a. The actual expected return will graph below the Security Market Line.
b. The stock has less systematic risk than the overall market.
c. The stock is overpriced.
d. The actual expected stock return indicates the stock is currently underpriced.
Answer: d. The actual expected stock return indicates the stock is currently underpriced.
Explanation:
According to CAPM, the expected return is:
= Risk free rate + beta * (market return - risk free rate)
= 4.3% + 1.14 * (12.01% - 4.3%)
= 13.09%
The actual expected return is greater than the CAPM expected return.
This stock is underpriced because it is bringing in a higher return than CAPM predicted based on the market.
Imagine that you work for a life insurance company. You are setting premiums for insurance based on life expectancy. Assuming you charge a higher premium for people expected to have shorter lives, you know that ________ will generally pay more for life insurance than ________.
Answer:
magine that you work for a life insurance company. You are setting premiums for insurance based on life expectancy. Assuming you charge a higher premium for people expected to have shorter lives, you know that ____older people____ will generally pay more for life insurance than ___younger people_____.
Explanation:
Setting life insurance premiums take into consideration the age of the insured (insurance policyholder). Other factors considered in setting premiums are gender, medical history, hobby, and career. Insurance premiums are periodic payments which the insured is expected to make to the insurance company (insurer) to cover the cost of the financial service being rendered and contribute to the defined benefits that will be paid upon expiration or in the event of the risk occurring.
Presented below are three revenue recognition situations.
a. Groupo sells goods to MTN for $908,000, payment due at delivery.
b. Groupo sells goods on account to Grifols for $797,000, payment due in 30 days.
c. Groupo sells goods to Magnus for $499,000, payment due in two installments, the first installment payable in 18 months and the second payment due 6 months later. The present value of the future payments is $462,200.
Required:
Indicate the transaction price for each of these transactions and when revenue will be recognized.
Answer:
Groupo
Transaction Price When to recognize revenue
a. $908,000 Delivery Time
b. $797,000 30 days' time
c. $462,200 18 months and 24 months' time
Explanation:
a) Data and Analysis:
a. $908,000 Delivery Time
b. $797,000 30 days' time
c. $462,200 18 months and 24 months' time
b) For the goods sold on installment sales, the payments are also deferred. Therefore, the seller does not recognize any gain until installments are received. Since installment sales encompass much longer time periods compared to credit sales, there are no discounts offered for early payments. The seller in an installment sales maintains an ownership interest in the goods sold until the buyer pays the balance due in full.
The adjusted trial balance of Pronghorn Corp at December 31, 2022, includes the following accounts: Retained Earnings $17,000, Dividends $6,700, Service Revenue $36,300, Salaries and Wages Expense $14,000, Insurance Expense $1,880, Rent Expense $4,080, Supplies Expense $1,440, and Depreciation Expense $900.
Required:
Prepare an income statement for the year.
Answer and Explanation:
The preparation of the income statement is presented below:
Service Revenue $36,300
Less:
Salaries and Wages Expense $14,000
Insurance Expense $1,880
Rent Expense $4,080
Supplies Expense $1,440
Depreciation Expense $900
Net income $14,000
Basically we subtracted the expenses from the revenues in order to get the net income
Bottum Corporation, a manufacturing Corporation, has provided data concerning its operations for May. The beginning balance in the raw materials account was $22,500 and the ending balance was $41,000. Raw materials purchases during the month totaled $68,000. Manufacturing overhead cost incurred during the month was $113,500, of which $2,500 consisted of raw materials classified as indirect materials. The direct materials cost for May was:
Answer:
the direct material cost is $47,000
Explanation:
The computation of the direct material cost is shown below:
= Opening balance + purchase made - indirect material - closing balance
= $22,500 + $68,000 - $2,500 - $41,000
= $47,000
hence, the direct material cost is $47,000
The same should be considered and relevant too
In most situations, asset values do not equal the amount of money that could be realized if the assets were sold.
a. True
b. False
Answer:
True
Explanation:
The answer to this question is true. The recording of assets is usually done at cost. This is equivalent to the value that was exchanged when the asset was sold. In a country like the United States for example, if an asset such as a land or machine gets to appreciate in value after a period of time, it is not usually revalued. Therefore the answer to this question is true.
Pharmaceutical companies are sometimes perceived as profiting unfairly from drugs they sell. Suppose that a new law shortens the time during which the manufacturer has exclusive use of the drug formula. Place the events in sequence to illustrate how restricting profits by pharmaceutical companies will affect innovation.
a. Pharmaceutical companies reduce their estimate of the profitability of new drug research.
b. Fewer new drugs are brought to market.
c. Pharmaceutical companies are less willing, to invest in drug development.
Answer:
1. Pharmaceutical companies reduce their estimate of the profitability of new drug research.
2. Pharmaceutical companies are less willing to invest in drug development.
3. Fewer new drugs are brought to market.
Explanation:
Given that the pharmaceutical companies are recognized as making profits in an unfair way by selling drugs. Now there is a new law which shortens the duration of time of the use of the drug formula by the manufacturer.
Thus the events in a sequence order which shows how the restricting profits by the pharmaceutical companies affects the innovation are :
The companies tries to reduce their estimate of profitability of the new drug research.The pharmaceutical research does not want to invest their money in the research and development of the drugs.Only few drugs are put in the market.If you encounter a process that has limited flexibility, shorter lead times, and cheaper products, customization most likely is occuring:
Answer: late in the supply chain
Explanation:
Assemble to order refers to a strategy whereby the products ordered by customers are manufactured quickly while they are customizable to an extent
Even though the basic parts of the product are manufactured already, they're not yet assembled until an order comes in.
If a process that has limited flexibility, shorter lead times, and cheaper products, customization most likely is occuring late in the supply chain.
In a situation where a process with limited flexibility, shorter lead times, and cheaper products, customization of the product or service will most likely occur D. Late in the Supply Chain
Given the process's limited flexibility and shorter lead times, customization, which is a process that tailors a product or service to meet specific customer's or market's demands, cannot occur early, at every step of the Supply Chain, or before procurement of raw materials.
Thus, customization occurs later in the Supply Chain when the goods are about to be delivered to the customer because delivery and satisfying customers or the market are the ultimate goals of any Supply Chain management.
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To what extent are moral ideas reflect society around us, and to what extent are we free to think for ourselves about moral matters?
Answer:
Moral ideas reflect society through collective behaviors that are presented by a large part of the population. These behaviors determine how far we are free to think about moral issues, as there is a social pressure that we associate our thoughts within this collective behavior.
Explanation:
Moral ideas determine what is right and wrong within society. This makes the population organize to act and behave in accordance with these oral ideas, collectively, always encouraging what is considered correct, good and progressive. This type of concept limits the freedom of individuals to think for themselves and reach their own conclusions about moral issues and social behavior, because there is pressure for the moral ideas accepted by most members of the population to be accepted without debate. For this reason, issues such as homosexuality, abortion, euthanasia, among others, are sources of criticism for a social minority, which decides to take a stand on these issues in a way contrary to the positing revealed as a moral idea by the majority of society.
All sales are made on credit. Based on past experience, the company estimates 0.3% of net credit sales to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense
Answer:
Missing word "A company uses the percent of sales method to determine its bad debts expense. At the end of the current year, the company's unadjusted trial balance reported the following selected amounts: Accounts receivable $350,000 debit, Allowance for uncollectible accounts 650 debit, Net Sales 795,000 credit"
Net credit sales = $795,000
Bad debt expense = 0.3% * Net credit sales
Bad debt expense = $795,000 * 0.3%
Bad debt expense = $2,385
Adjusting entry
Date General Journal Debit Credit
Bad debt expense $2,385
Allowance for uncollectible accounts $2,385
(To record bad debt expense)
Mustang Corporation has accumulated the following accounting data for the month of April: Finished goods inventory, April 1$32,400 Finished goods inventory, April 30 26,400 Total cost of goods manufactured 122,900 The cost of goods sold for the year is:
Answer:
$128,900
Explanation:
Cost of goods sold calculation
Opening Finished goods inventory $32,400
Add cost of goods manufactured $122,900
Less Closing Finished goods inventory ($26,400)
Cost of goods sold $128,900
therefore,
The cost of goods sold for the year is $128,900.