Answer:
10,500
Explanation:
As per the given question the solution of the total number of clippers is provided below:-
Here we will assume the sales = x
((Economy clippers × Sales price) - (Economy clippers × Economy clipper cost)) + ((Remaining percentage × Sales) - (Remaining percentage × High end model cost) - Fixedd cost = Profit
= ((0.70x × $9) - (0.70x × $5)) + ((0.30x × $15) - (0.30x × $9)) - $35,880 = $12,420
= (6.3x - 3.5x) + (4.5x - 2.7x) = $35,880 + $12,420
= (2.8x + $1.8x) = $48,300
= 4.6x = $48300
x = $48,300 ÷ 4.6
x = $10,500
So, the total number of clippers that must be sold to earn a $12,420 profit = 10,500 clippers
Economy clippers is 70% of the market = 10,500 × 70%
= 7,350 clipper
High-end clippers is 30% of the market = 10500 × 30%
= 3,150 clipper
So, the total number of clippers = 7,350 clipper + 3,150 clipper
= 10,500 clippers
Therefore by using the above formula we simply solve the total number of clippers.
Johnson Corporation unadjusted trial balance at year-end include the following accounts. Compute the uncollectible account expense, and make the appropriate journal entry, for the current year assuming the uncollectible account expense is determined as follows:
A. Without considering the balance in the Allowance for Doubtful Accounts, income statement approach, 1% of total sales.
B. Without considering the balance in the Allowance for Doubtful Accounts, income statement approach, 1.5% of credit sales.
C. Considering the balance in the Allowance for Doubtful Accounts, balance sheet approach. The estimate based on an aging of accounts receivable is that an allowance of $12,000 would be appropriate.
Answer and Explanation:
The computations and the journal entries are as follows
A. Uncollectible account expense is
= Given percentage × total sales
= 1% × $1,152,000
= $11,520
The journal entry is
Uncollectable Expense Dr $11,520
To Allowance for doubtful accounts $11,520
(Being the uncollectible expense is recorded)
For recording this we debited the uncollectable expense as it increased the expenses and credited the allowance for doubtful debts as it decreased the assets
B. Uncollectible account expense is
= Given percentage × credit sales
= 1.5% × $1,152,000 × 75%
= $12,960
The journal entry is
Uncollectable Expense Dr $12,960
To Allowance for doubtful accounts $12,960
(Being the uncollectible expense is recorded)
For recording this we debited the uncollectable expense as it increased the expenses and credited the allowance for doubtful debts as it decreased the assets
C. Uncollectible account expense is
= Appropriate Allowance - credit balance of allowance for doubtful debts
= $12,000 - $2,184
= $9,816
The journal entry is
Uncollectable Expense Dr $9,816
To Allowance for doubtful accounts $9,816
(Being the uncollectible expense is recorded)
For recording this we debited the uncollectable expense as it increased the expenses and credited the allowance for doubtful debts as it decreased the assets
Training is a way for employers to provide To enable employees to protect themselves and other injuries
The question is incomplete. Here is the complete question
Training is a way for employers to provide _______ to enable employees protect themselves and others from injuries
(a) Idea
(b) Tools
(c) Interaction
(d) Money
Answer:
Interaction
Explanation:
It is necessary for employers to organise training programs with employees that are exposed to various hazards in the workplace. Training helps to provide a form of interaction between both employers and employees, it enables them to discuss on ways to counters different accidents that might happen when working.
Training enables the employees to express their view on areas that they are not completely sure of, it is now left for the employers to hire a professional to train each employees on the rules and guidelines to follow inorder to prevent any form of accident.
Sunland Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 1,940 kits was prepared for the year. Fixed operating expenses account for 78% of total operating expenses at this level of sales.
Sales $ 97,000
Cost of goods sold (all variable) 58,200
Gross margin 38,800
Operating expenses 33,950
Operating income $ 4,850
Assume that during the year Sunland Sports actually sold 2,037 volleyball kits during the year at a price of $47 per kit.
Required:
1. Calculate the sales price variance.
Answer:
$6,111 unfavorable variance
Explanation:
The budgeted sales price can be determined by dividing budgeted sales of $97,000 by the budgeted sales volume of 1,940 kits i.e $50 ($97,000/1940)
However,2037 volleyball kits were sold for $47 each instead of the planned $50 per kit.
sales price variance=(actual sales volume*actual sales price)*(budgeted sales price*actual sales volume)
actual sales volume is 2037
actual sales price is $47
budgeted sales price is $50
sales price variance=($47*2037)-($50*2037)=$-6111
For each separate case below, follow the 3-step process for adjusting the prepaid asset account at December 31.
Step 1: Determine what the current account balance equals.
Step 2: Determine what the current account balance should equal.
Step 3: Record the December 31 adjusting entry to get from step 1 to step 2.
Assume no other adjusting entries are made during the year.
a. Prepaid Insurance. The Prepaid Insurance account has a $4,700 debit balance to start the year. A re- view of insurance policies and payments shows that $900 of unexpired insurance remains at year-end.
b. Prepaid Insurance. The Prepaid Insurance account has a $5,890 debit balance at the start of the year. A review of insurance policies and payments shows $1,040 of insurance has expired by year-end.
c. Prepaid Rent. On September 1 of the current year, the company prepaid $24,000 for 2 years of rent for facilities being occupied that day. The company debited Prepaid Rent and credited Cash for $24,000.
Answer:
a. Prepaid Insurance. The Prepaid Insurance account has a $4,700 debit balance to start the year. A re- view of insurance policies and payments shows that $900 of unexpired insurance remains at year-end.
Step 1: $4,700 debit balance
Step 2: $900 debit balance
Step 3: $4,700 - $900 = $3,800
Dr Insurance expense 3,800
Cr Prepaid insurance 3,800
b. Prepaid Insurance. The Prepaid Insurance account has a $5,890 debit balance at the start of the year. A review of insurance policies and payments shows $1,040 of insurance has expired by year-end.
Step 1: $5,890 debit balance
Step 2: $4,850 debit balance (= $5,890 - $1,040)
Step 3: $1,040
Dr Insurance expense 1,040
Cr Prepaid insurance 1,040
c. Prepaid Rent. On September 1 of the current year, the company prepaid $24,000 for 2 years of rent for facilities being occupied that day. The company debited Prepaid Rent and credited Cash for $24,000.
Step 1: $24,000 debit balance
Step 2: $20,000 debit balance (= $24,000 - $4,000)
Step 3: ($24,000/24) x 4 = $4,000
Dr Rent expense 4,000
Cr Prepaid rent 4,000
d) Following is forecast for economic situation and Rachel’s portfolio returns next year, calculate the
expected return, variance and standard deviation of the portfolio. (4 marks)
State of economy Probability Rate of returns
Mild Recession 0.35 - 5%
Growth 0.45 15%
Strong Growth 0.20 30%
Answer:
Expected return = 15.25%
Variance = 80.31
Standard deviation = 8.961
Explanation:
Expected value of return (Er) =
(0.35 × 5%) + (0.45× 15%) + (0.20 × 30%)= 15.25 %
Variance and standard deviation
Outcome Rate Deviation Variance
r- Er (r-Er)^2.P
Mild 5 -10.25 36.771875
Growth 15 -0.25 0.028125
Strong 30 14.75 43.5125
Total 80.3125
Variance = 80.3125
Standard deviation = √variance = √80.3125
= 8.96
Expected return = 15.25%
Variance = 80.31
Standard deviation = 8.961
Recording Journal Entries
Nathanson Corporation was organized on May 1. The following events occurred during the first month.
A. Received $68,000 cash from the five investors who organized Nathanson Corporation. Each investor received 101 shares of $10 par value common stock.
B. Ordered store fixtures costing $12,000.
C. Borrowed $20,000 cash and signed a note due in two years.
D. Purchased $17,000 of equipment, paying $1,900 in cash and signing a six-month note for the balance.
E. Lent $1,400 to an employee who signed a note to repay the loan in three months.
F. Received and paid for the store fixtures ordered in (b).
Prepare journal entries for each transaction.
Answer:
A.
Cash $68,000 (debit)
Common Stock $68,000 (credit)
B.
Store fixtures $12,000 (debit)
Payable $12,000 (credit)
C.
Cash $20,000 (debit)
Note Payable $20,000 (debit)
D.
Equipment $17,000 (debit)
Cash $1,900 (credit)
Note Payable $15,100 (credit)
E.
Note Receivable $1,400 (debit)
Cash $1,400 (credit)
F.
Payable $12,000 (debit)
Cash $12,000 (credit)
Explanation:
A.
Recognize Cash and Recognize Equity - Common Stock
B.
Recognize Store fixtures and recognize a liability - Payable
C.
Recognize Cash - Asset and a Liability - Note Payable
D.
Recognize Equipment - Asset , Recognize Liability - Note Payable and de-recognize the Asset - Cash
E.
De-recognize Cash and Recognize the Asset - Note Receivable
F.
De-recognize the Liability - Payable and de-recognize the Asset Cash
An ordinary annuity selling at $4,947.11 today promises to make equal payments at the end of each year for the next eight years (N). If the annuity’s appropriate interest rate (IN) remains at 6.50% during this time, the annual annuity payment (PMT) will be ________. You just won the lottery. Congratulations! The jackpot is $35,000,000, paid in eight equal annual payments. The first payment on the lottery jackpot will be made today. In present value terms, you really won ________ assuming annual interest rate of 6.50%.
Answer:
$812.49 and $28,369,687.5
Explanation:
Let us assume the annual payments be X
Sale of ordinary annuity = X × PVAF factor
$4,947.11 = X × PVAF(6.5%, 8 years)
$4,947.11 = 6.0888 × X
X = $812.49
And,
The Present value is
Present value = Annual payments + Annual payments × PVAF factor
= $4,375,000 + $4,375,000 × PVAF(6.5%, 7 years)
= $4,375,000 + $4,375,000 × 5.4845
= $28,369,687.5
The $4,375,000 is come from
= $35,000,000 ÷ 8 years
= $4,375,000
Refer to the PVAF factor table
We simply applied the above formulas
The following information is available for Larkspur Corporation for the year ended December 31, 2022.
Beginning cash balance $40,000
Accounts payable decrease 3,200
Depreciation expense 84,000
Accounts receivable increase 9,400
Inventory increase 12,300
Net income 257,000
Cash received for sale of land at book value 40,000
Sales revenue 745,000
Cash dividends paid 11,900
Income tax payable increase 4,000
Cash used to purchase building 140,500
Cash used to purchase treasury stock 30,100
Cash received from issuing bonds 269,000
Prepare a statement of cash flows using the indirect method.
Answer:
The statement of cash flows using the indirect method would be the following:
Cash flow statement for year ended December 31, 2022:
Description Amount Amount
Operating activities:
Net income $257,000
Adjustments to reconcile net income to net cash from operating activities
Add: Depreciation expense $84,000
Less: Decrease in accounts payable ($3,200)
Less: Increase in accounts receivable ($9,400)
Less: Increase in inventory ($12,300)
Add: Income tax payable increase $4,000
Net cash flows from operating activities $320,100
Investing activities:
Buildings purchased ($140,500)
Cash received from sale of land $40,000
Net cash flows from investing activities ($100,500)
Financing activities:
Dividends paid ($11,900)
Treasury stock purchased ($30,100)
Proceeds from bond issue $269,000
Net cash flows from financing activities $227,000
Net change in cash $446,600
Beginning cash balance $40,000
Ending cash balance $486,600
Explanation:
The statement of cash flows using the indirect method would be the following:
Cash flow statement for year ended December 31, 2022:
Description Amount Amount
Operating activities:
Net income $257,000
Adjustments to reconcile net income to net cash from operating activities
Add: Depreciation expense $84,000
Less: Decrease in accounts payable ($3,200)
Less: Increase in accounts receivable ($9,400)
Less: Increase in inventory ($12,300)
Add: Income tax payable increase $4,000
Net cash flows from operating activities $320,100
Investing activities:
Buildings purchased ($140,500)
Cash received from sale of land $40,000
Net cash flows from investing activities ($100,500)
Financing activities:
Dividends paid ($11,900)
Treasury stock purchased ($30,100)
Proceeds from bond issue $269,000
Net cash flows from financing activities $227,000
Net change in cash $446,600
Beginning cash balance $40,000
Ending cash balance $486,600
Discuss the different roles played by the qualitative and quantitative approaches to managerial decision making. Why is it important for a manager or decision maker to have a good understanding of both of these approaches to decision making? Give an example of when the qualitative approach might be more appropriate and another example of when the quantitative approach might be more appropriate.
Explanation:
Regarding the management decision-making process, there are two different approaches that the manager must know and know how to use in certain situations.
The qualitative approach is one that is based on experimental knowledge of various factors involved in decision making, such as interpersonal connections that occur in the work environment, in this approach it is necessary that the manager has an intuition and accurate perception of the organization as a whole before making an important decision
The quantitative approach is one that uses mathematical statistics for decision making, generally works best for solving measurable problems, and for this reason can be used by a manager without much direct experience.
The qualitative approach may be more appropriate in a situation where a manager needs to solve problems related to situations of conflict between organizational departments, because in this scenario it is necessary to have knowledge of factors that generate the complex interaction between people.
The quantitative approach can be more useful in a scenario where it needs to analyze which are the most profitable departments in the organization and what is the probability of each department generating profits in the company, because in this case accounting data are used to support decision making.
Sunland Co. has the following transactions related to notes receivable during the last 2 months of the year. The company does not make entries to accrue interest except at December 31.
Nov. 1 Loaned $63,600 cash to C. Bohr on a 12-month, 9% note.
Dec. 11 Sold goods to K. R. Pine, Inc., receiving a $5,400, 90-day, 8% note.
16 Received a $14,400, 180-day, 6% note to settle an open account from A. Murdock.
31 Accrued interest revenue on all notes receivable.
Journalize the transactions for Sunland Co. (Omit cost of goods sold entries.) (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. Use 360 days for calculation.)
Date Account Titles and Explanation Debit
Answer:
Nov. 1 Loaned $63,600 cash to C. Bohr on a 12-month, 9% note
Debit Notes receivable $63,600
Credit Cash $63,600
(To record notes receivable)
Debit Interest receivable $954
Credit Interest revenue $954
(To record accrued interest as at Dec 31)
Dec. 11 Sold goods to K. R. Pine, Inc., receiving a $5,400, 90-day, 8% note
Debit Notes receivable $5,400
Credit Cash $5,400
(To record notes receivable)
Debit Interest receivable $23
Credit Interest revenue $23
(To record accrued interest as at Dec 31)
16 Received a $14,400, 180-day, 6% note to settle an open account from A. Murdock
Debit Notes receivable $14,400
Credit Cash $14,400
(To record notes receivable)
Debit Interest receivable $34
Credit Interest revenue $34
(To record accrued interest as at Dec 31)
Explanation:
Note is a promissory note with a written promise made by the borrower to the lender (payee) to pay a certain, definite sum at a specified date.
Interest expense on the notes is calculated as: Principal x Interest Rate x Time
Nov. 1: In this case, the total interest revenue is: $63,600 x 9%/12 x 12 months = $5,724.
Interest expense as at December 31 is therefore $5,724 / 12 x 2 = $954.
Dec. 11: Total interest revenue is: $5,400 x 8%/12 x 3 months = $108.
Interest expense as at December 31 is therefore $108 / 90 days x 19 days = $23.
Dec. 16: Total interest revenue is: $14,400 x 6%/12 x 6 months = $432.
Interest expense as at December 31 is therefore $432 / 180 days x 14 days = $34.
Wages of $8,000 are earned by workers but not paid as of December 31. Depreciation on the company’s equipment for the year is $10,480. The Office Supplies account had a $470 debit balance at the beginning of the year. During the year, $5,063 of office supplies are purchased. A physical count of supplies at December 31 shows $556 of supplies available.
A. The Prepaid Insurance account had a $5,000 balance at the beginning of the year. An analysis of insurance policies shows that $1,600 of unexpired insurance benefits remain at December 31.
B. The company has earned (but not recorded) $650 of interest revenue for the year ended December 31. The interest payment will be received 10 days after the year-end on January 10.
C. The company has a bank loan and has incurred (but not recorded) interest expense of $2,500 for the year ended December 31. The company will pay the interest five days after the year-end on January 5.
Answer:
(1). Wages expense(debit) => 8000.
wages payable (credit) => 8000.
(2). depreciation expense-equipment(debit) => $10,480.
accumulated depreciation-equipment => $10,480.
(3). Supplies expense(debit) => 4,977.
office supplies(credit) => 4977.
(4). Insurance expense(debit) => 3,400
prepaid insurance(credit) => 3,400.
(5000 - 1600).
(5). Interest receivable(debit) => $650
interest revenue(credit) => $650
(6). interest expense(debit) => $2,500
interest payable(credit) => $2,500.
Explanation:
So, our main aim in this question is to be able to prepare prepare an " adjusting entries" required of financial statements for the year ended (date of) December 31.
An adjusting entries can simply be defined as entry that is used in showing the expenses and income of a particular organization or company.
Thus, the entries can be written as:
(1). Wages expense(debit) => 8000.
wages payable (credit) => 8000.
(2). depreciation expense-equipment(debit) => $10,480.
accumulated depreciation-equipment => $10,480.
(3). Supplies expense(debit) => 4,977.
office supplies(credit) => 4977.
(4). Insurance expense(debit) => 3,400
prepaid insurance(credit) => 3,400.
(5000 - 1600).
(5). Interest receivable(debit) => $650
interest revenue(credit) => $650
(6). interest expense(debit) => $2,500
interest payable(credit) => $2,500.
A number of business transactions carried out by Smalling Manufacturing Company are as follows.
a. Borrowed money from a bank.
b. Sold land for cash at a price equal to its cost.
c. Paid a liability.
d. Returned for credit some of the office equipment previously purchased on credit but not yet paid for. (Treat this the opposite of a transaction in which you purchased office equipment on credit.)
e. Sold land for cash at a price in excess of cost. (Hint: The difference between cost and sales price represents a gain that will be in the company’s income statement.)
f. Purchased a computer on credit.
g. The owner invested cash in the business.
h. Purchased office equipment for cash.
i. Collected an account receivable.
Required:
1. Indicate the effects of each of these transactions on the total amounts of the company's assets, liabilities, and owner's equity.
Answer and Explanation:
The indications of the effect of each of following transactions are as follows
Particulars Assets Liabilities Stockholder equity
a. Borrowed
money from bank Increase Decrease No effect
b. Sold land for Cash increase No effect No effect
cash at Land decrease
a price equal
to its cost
c. Paid a liability Decrease Decrease No effect
d. Returned for credit Decrease Decrease No effect
some of the office
equipment previously
purchased on credit
but not yet paid for
e. Sold land for cash at Cash increase No effect Increase as Gain
a price in excess of cost Land decrease
f. Purchased a computer Increase Increase No effect
on credit
g. The owner invested
cash in the business Increase No effect Increase
h. Purchased office Increase in office No effect No effect
equipment for cash Decrease in cash
g. Collected an Increase in cash No effect No effect
account receivable Decrease in account
receivable
Kiano, a telecommunications equipment manufacturer, manufactures PDAs (P), wireless handsets (H), and blackberrys (B). They have a limited supply of common parts---ethernet card (450 in inventory), antenna (250 in inventory), chipset (800 in inventory), battery/power supply (450 in inventory), LCD screen (600 in inventory)---that these products use. A PDA requites an ethernet card, 2 chipsets, a power supply, and 2 LCD screens. A wireless handset requires an ethernet card, an antenna, 2 chipsets, a power supply, and a LCD screen. A blackberry requires a chipset and a LCD screen. The profit on PDAs is $80, the profit on wireless handsets is $60, and the profit on blackberrys is $35. The following is a linear programming formulation of the problem.
Let
P = Number of PDAs produced
H = Number of wireless handsets produced
B = Number of blackberrys produced
We may write model for this problem as follows.
Maximize 80P + 60H + 35B
subject to:
(ethernet card constraint) P + H ? 450
(antenna constraint constraint) H ? 250
(chipset constraint) 2P + 2H + B ? 800
(power supply constraint) P + H ? 450
(LCD screen constraint) 2P + H + B ? 600
(non-negativity) P, H, B ? 0.
Implement the above model in Solver and make sure to choose Simplex as the solving method and to choose the option "Make Unconstrained Variables non-negative"---do not explicitly put in the non-negativity constraints in the model and using the sensitivity report only
answer the questions below:
a. Does the solution change if only 425 ethernet cards are available?
b. Is it profitable to produce Blackberrys? If not, by how much should the profit margin on Blackberrys be increased to make it profitable to produce Blackberrys?
c. Because of a change in production technology the profit margin on handsets has increased to $70. Should the production plan of Kiano change? What is their new profit?
d. 50 chipsets were found to be defective, making the number of available chipsets 750. What will the profit be in this situation?
e. Another supplier is willing to sell LCD screens to Kiano. However their prices for a LCD screen are $20 higher than what Kiano pays it's regular supplier. Should Kiano go ahead and purchase these electronic units? If yes, at most how many units should they purchase.
f. Kiano is considering introducing a new product (called the Revolutionary Communicator) that combines the wireless handset and PDA. This product uses an ethernet card, an antenna, 2 chipsets, 1 power supply, and 2 LCD screens, and is expected to make a profit of $100. Should Kiano produce the Revolutionary Communicator? Why or Why not?
Answer:
Explanation:
Please check the attached file below to see answer to the given question
Dermody Snow Removal's cost formula for its vehicle operating cost is $2,900 per month plus $320 per snow-day. For the month of December, the company planned for activity of 15 snow-days, but the actual level of activity was 13 snow-days. The actual vehicle operating cost for the month was $7,980. The spending variance for vehicle operating cost in December would be closest to:
a. $280 U
b. $280 F
c. $920 U
d. $920 F
Answer:
$920 U
Explanation:
Spending variance for vehicle operating cost = Flexible budget-actual
= (320*13+2900)-7980
=(4160+2900)-7980
=$920 U
Spending variance for vehicle operating cost = $920 U
Takei Company's payroll for the week ending January 15 amounted to $367,000 for salaries and wages. None of the employees has reached the earnings limits specified for federal or state employer payroll taxes. The following deductions were withheld from employees' salaries and wages:
Federal Income Tax $75,000
State Income Tax 13,500
FICA Taxes 28,075
Union Dues 4,100
United Fund Contributions 2,700
Federal unemployment tax (FUTA) rate is 6.2% less a credit equal to the rate paid for state unemployment taxes. The state unemployment tax (SUTA) rate is 5.4%.
Required:
a. Prepare the journal entry to record the weekly payroll ending January 15 and also the employer's payroll tax expense on the payroll.
Find the given attachment
Rauch Incorporated leases a piece of equipment to Donahue Corporation on January 1, 2020. The lease agreement called for annual rental payments of $4,892 at the beginning of each year of the 4-year lease. The equipment has an economic useful life of 6 years, a fair value of $25,000, a book value of $20,000, and both parties expect a residual value of $8,250 at the end of the lease term, though this amount is not guaranteed. Rauch set the lease payments with the intent of earning a 5% return, and Donahue is aware of this rate. There is no bargain purchase option, ownership of the lease does not transfer at the end of the lease term, and the asset is not of a specialized nature.Prepare the lease amortization schedule(s) for Donahue for all 4 years of the lease. (Round answers to 0 decimal places, e.g. 5,275.)
Answer:
Explanation:
DONAHUE CORPORATION Lease Amortization Schedule Annuity-Due Basis Reduction of Interest on Liability Lease Liability Annual Payment Lease Liability 4892 4892 4 892 1/1/22 1 1/1/237 4892
Lease Expense Schedule Interest on Amortization of Lease Liability ROU Asset Lease Expense (Straight-Line) Date Carrying Value of ROU Asset 1/1/20 4892 290 4892 12/31/20 12/31/21 12/31/22 12/31/23 4892 4892
Date Account Titles and Explanation Debit Credit 1/1/20 | Right-of-Use Asset 182141 T 18214 Lease Liability (To record the lease) 1/1/20 Lease Liability 4,892 T 4,892 Cash (To record lease payment) 12/31/20 Lease Expense 4,892 Lease Liability Right-of-Use Asset
[1/1/21 || Lease Liability 4.8921T Cash 4,892 12/31/21 - || Lease Expense 4,8921T 1 PPPTT Lease Liability 22649 Right-of-Use Asset 22649
Date Account Titles and Explanation Debit Credit 1/1/20 Right-of-Use Asset 18214 Lease Liability 22649 Cash 22649 (To record the lease) 11/1/20 1/1/20 | Lease Liability Lease Liability 4,892 4,892 Cash (To record lease payment) [12/31/20 Lease Expense 4892 Lease Liability 22649 T Right-of-Use Asset 22649
Nate is investing in a partnership with David. Nate contributes as part of his initial investment, Accounts Receivable of $60,000; an Allowance for Doubtful Accounts of $9,000; and $6,000 cash. The entry that the partnership makes to record Nate's initial contribution includes a______ a. debit to Allowance for Doubtful Accounts for $9,000 b. credit to Nate, Capital for $57,000 c. debit to Accounts Receivable for $51,000 d. credit to Nate, Capital for $66,000.
Answer:
b. credit to Nate, Capital for $57,000
Explanation:
Nate is investing in the business and All his investment will be recorded by the partners as follow
Dr. Receivable $60,000
Dr. Cash $6,000
Cr. Nate Capital Account $57,000
Cr. Allowance for Doubtful Accounts $9,000
All the receivables are become the receivables of the business.
Cash is also added to the business cash.
Allowance for Doubtful Accounts are also recorded against the receivable added.
Net effect of all the above account will be recorded as Capital investment
Answer:
CREDIT to Nate capital for $57000 ( B )
Explanation:
NATE contributions
accounts receivables = $60000
allowance for doubtful accounts = $9000 ( FOR DEBTORS )
cash = $6000
therefore the entry the partnership makes to record Nate's initial contribution includes = ACCOUNTS RECEIVABLE + CASH - allowance for doubtful accounts
= 60000 + 6000 - 9000 = $57000
Rachael’s Restaurant, a fast-food restaurant company, operates a chain of restaurants across the nation. Each restaurant employs eight people; one is a manager paid a salary plus a bonus equal to 4 percent of sales. Other employees, two cooks, one dishwasher, and four servers, are paid salaries. Each manager is budgeted $3,000 per month for advertising costs.
Required: Classify each of the following costs incurred by Rachael's Restaurant as fixed, variable, or mixed:
a. Advertising costs relative to the number of customers for a particular restaurant.
b. Rental costs relative to the number of restaurants.
c. Cooks salaries at a particular location relative to the number of customers.
d. Cost of supplies (cups, plates, spoons, etc.) relative to the number of customers.
e. Manager's compensation relative to the number of customers.
f. Servers' salaries relative to the number of restaurants.
Answer:
a. Advertising costs relative to the number of customers for a particular restaurant. [Fixed]
b. Rental costs relative to the number of restaurants. [Variable]
c. Cooks salaries at a particular location relative to the number of customers. [Fixed]
d. Cost of supplies (cups, plates, spoons, etc.) relative to the number of customers. [Variable]
e. Manager's compensation relative to the number of customers. [Mixed]
f. Servers' salaries relative to the number of restaurants. [Variable]
Explanation:
Thomson Co. produces and distributes semiconductors for use by computer manufacturers. Thomson issued $800,000 of 10-year, 6% bonds on May 1 of the current year at face value, with interest payable on May 1 and November 1. The fiscal year of the company is the calendar year.
May 1. Issued the bonds for cash at their face amount.
Nov. 1. Paid the interest on the bonds.
Dec. 31. Recorded accrued interest for two months.
Journalize the entries to record the above selected transactions for the current year. If an amount box does not require an entry, leave it blank.
May 1
Nov. 1
Dec. 31
Answer:
May 1
Dr Cash 800,000
Cr Bonds payable 870,000
Nov 1
Dr Interest expense 24,000
Cr Cash 24,000
Dec 31
Dr Interest expense 8,000
Cr Interest payable 8,000
Explanation:
Thomson Co Journal entries
May 1
Dr Cash 800,000
Cr Bonds payable 870,000
Nov 1
Dr Interest expense 24,000
Cr Cash 24,000
(800,000*6%*6/12)
Dec 31
Dr Interest expense 8,000
Cr Interest payable 8,000
(800,000*6%*2/12)
Porter Resources Company acquired a tract of land containing an extractable natural resource. Porter is required by its purchase contract to restore the land to a condition suitable for recreational use after it has extracted the natural resource. Geological surveys estimate that the recoverable reserves will be 2,000,000 tons, and that the land will have a value of $1,000,000 after restoration. Relevant cost information follows:
Land $7,500,000
Estimated restoration costs 1,500,000
If Porter maintains no inventories of extracted material, what should be the charge to depletion expense per ton of extracted material?
Answer:
A. $4
Explanation:
The computation of amount of depletion per ton is shown below:-
Depletion per ton = (Acquisition cost of land + Estimated restoration costs- Salvage value) ÷ Tons of recoverable reserves
= ($7,500,000 + $1,500,000 - $1,000,000) ÷ 2,000,000 tons
= (9,000,000 - $1,000,000) ÷ 2,000,000 tons
= $8,000,000 ÷ 2,000,000 tons
= $4
Therefore for computing the depletion per ton we simply applied the above formula.
Top management of Drexel-Hall is considering closing Store 3. The three stores are close enough together that management estimates closing Store 3 would cause sales at Store 1 to increase by $60,000, and sales at Store 2 to increase by $120,000. Closing Store 3 is not expected to cause any change in common fixed costs. Compute the increase or decrease that closing Store 3 should cause in: a. Total monthly sales for Drexel-Hall stores. b. The monthly responsibility margin of Stores 1 and 2. c. The company’s monthly income from operations. Williams, Jan. Financial & Managerial Accounting (p. 980). McGraw-Hill Higher Education. Kindle Edition.
Answer:
Compute the increase or decrease that closing Store 3 should cause in: a. Total monthly sales for Drexel-Hall stores.
total monthly sales should decrease from $1,800,000 to $1,380,000 = a $420,000 reductionb. The monthly responsibility margin of Stores 1 and 2.
store 1 responsibility margin increased from 10% to 12.55% (2.55% increase)store 2 responsibility margin increased from 9% to 13.69% (4.69% increase)c. The company’s monthly income from operations.
increased from $72,000 to $140,200 ($70,200 increase)Explanation:
Store Store Total
1 2
Sales $660,000 $720,000 $1,380,000
Variable costs $409,200 $453,600 $862,800
Contribution margin $250,800 $266,400 $517,200
Controllable fixed costs $120,000 $102,000 $222,000
Performance margin $130,800 $164,600 $292,200
Committed fixed costs $48,000 $66,000 $114,000
Store responsibility margin $82,800 $98,600 $178,200
Common fixed costs $38,000
Income from operations $140,200
Alt Corp. issues 5,000 shares of $10 par value common stock at $14 per share. When the transaction
is recorded, credits are made to:
a. Common Stock $50,000 and Paid-in Capital in Excess of Stated Value $20,000.
b. Common Stock $70,000.
c. Common Stock $50,000 and Paid-in Capital in Excess of Par Value $20,000.
d. Common Stock $50,000 and Retained Earnings $20,000.
Answer:
c. Common Stock $50,000 and Paid-in Capital in Excess of Par Value $20,000.
Explanation:
The journal entry is shown below:
Cash $70,000 (5,000 shares × $14)
To Common stock $50,000 (5,000 shares × $10)
To Additional Paid in capital in excess of par value - Common stock $20,000 (5,000 shares × $4)
(Being the issuance of the common stock is recorded)
For recording this we debited the cash as it increased assets and at the same time it also increased the overall stockholder equity so common stock and the additional paid in capital for common stock is credited
Compute the investment account (market value differs from book value) Assume that the fair values of the investee's net assets approximated the recorded book values of the investee's net assets, except the fair value of receivables and inventories is $30,000 higher than book value, the fair value of land is $5,000 lower than book value, the fair value of property and equipment is $20,000 higher than book value and the fair value of liabilities is $7,000 lower than book value. In addition, the transaction resulted in goodwill in the amount of $25,000. What is the balance in the preconsolidation "investment in investee" account on the investor company's books on January 1, 2013, immediately after the acquisition of the investee company voting common stock? Not enough information provided $247,000 $170,000 $25,000
Answer:
Explanation:
The picture attached is the complete question whereas the microsoft file attached is the solution to the problem. I needed to have a table so that is why i made use of microsoft in other to understand the explanation well. Thank you
Shores Sports rents canoes and kayaks. Below is the adjusted trial balance at December 31.
Debit Credit
Cash 1,500
Accounts Receivable 2,000
Interest Receivable 100
Prepaid Insurance 1,600
Notes Receivable (Long-Term) 2,800
Equipment 15,000
Accumulated Depreciation 3,000
Accounts Payable 2,400
Accrued Expenses Payable 3,920
Income Taxes Payable 2,700
Unearned Rent Fees 500
Common Stock 7,700
Dividends 2,000
Rental Revenue 37,000
Service Revenue 1,300
Wages Expense 19,000
Depreciation Expense 1,800
Utilities Expense 320
Insurance Expense 700
Maintenance Expense 9,000
Income Tax Expense 2,700
58,520 58,520
The entry required to close the revenue and expense accounts at the end of the period includes a:
a) credit to Retained Earnings for $4,780.
b) credit to Retained Earnings for $38,300.
c) debit to Retained Earnings for $4,780.
d) debit to Retained Earnings for $38,300.
Answer:
A) credit to Retained Earnings for $4,780.
Explanation:
Temporary accounts (includes all revenues and expenses) must be closed against the income summary account. Then the income summary account is closed against retained earnings, and depending on whether the company made a profit or not, the retained earnings account will be debited or credited.
In this case, the net income after taxes is $4,780, so that means that retained earnings will increase (should be credited), so the closing journal entry should be:
Dr Income summary 4,780
Cr Retained earnings 4,780
Rental Revenue 37,000
Service Revenue 1,300
Wages Expense (19,000 )
Depreciation Expense (1,800 )
Utilities Expense (320 )
Insurance Expense (700 )
Maintenance Expense (9,000 )
Income Tax Expense (2,700)
net income after taxes $4,780
Rush Industries, Inc. builds parts for large automated heavy equipment. The Vice President for Marketing has determined that sales are dwindling for the firm's products because of aggressive pricing by competitors. Rush Industries sells the product for $775 whereas the competition's comparable part is selling in the $650 range. The VP for Marketing has determined that a price drop to $625 is necessary to regain market share and annual sales of 1,200 units. Data based on sales of 1,200 units is as follows:
Budgeted Amount Actual Amount Cost
Direct materials (sheet metal) 8,000 sq.ft. 10,000 sq.ft. $9.66 per sq.ft.
Direct labor 4,800 hrs. 5,000 hrs. $33.60 per hour
Machine setups 2,600 hrs. 2,800 hrs. $42.00 per hour
Mechanical assembly 3,200 hrs. 3,600 hrs. $34.00 per hour
Required:
1. The current cost per unit is ___________.
Answer:
The current cost per unit is $ 420.50
Explanation:
The current cost per unit is synonymous with the actual cost per unit which is determined by summing up all costs incurred in actual sense and dividing by the sales volume of 1,200 units
direct materials =10,000*$9.66=$ 96,600
direct labor=5,000*$33.60 =$ 168,000
machine set-ups=2,800*$42 =$ 117,600
mechanical assembly=3,600*$34=$122,400
total actual costs =$ 504,600
cost per unit=total costs/sales volume=$ 504,600/1200=$ 420.50
Using budgeted figures would only give us budgeted cost per unit
The Sanding Department of Quik Furniture Company has the following production and manufacturing cost data for March 2020, the first month of operation. Production: 6,240 units finished and transferred out; 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs. Manufacturing costs: Materials $36,960; labor $21,400; overhead $30,242. Prepare a production cost report. (Round unit costs to 2 decimal places, e.g. 2.25 and other answers to 0 decimal places, e.g. 125.)
Answer:
Cost of goods transferred out $71,061.012
Value of closing inventory = $17,540.98
Explanation:
Cost per equivalent unit = Cost /total equivalent unit
Material
Equivalent unit = (100%×6,240) +( 100%× 3,000) = 9240
Cost per equivalent unit = $36,960/9,240 units= 4
Labour
Equivalent unit = (100%×6,240) + ( 25%× 3,000)= 6990 units
Cost per equivalent unit = ( 21,400 + 30,242)/6990 = 7.387982833
Cost of goods transferred out= (6,240× 4) + (7.38×6,240)=71,061.012
Value of closing inventory = (3,000× 4) + (7.38× 25%*3000)= 17,540.98
Cost of goods transferred out $71,061.012
Value of closing inventory = $17,540.98
Regulatory focus theory suggests that consumers will react differently depending on which broad set of motives is more salient. Name and describe the two prominent sets of motives and describe how consumers will react when each set of motives is more noticeable. Use a specific product or service to explain your answer.
Two prominent sets of motives under regulatory focus theory are termed Promotion and prevention.
What is regulatory focus theory?According to the regulatory focus hypothesis, people can work toward objectives with either a promotion or a preventive emphasis. People who aim for advancement interpret pleasure as the accomplishment of their aims, ambitions, and aspirations, and interpret suffering as their absence.
Motives assume that emotional trade-offs between both the coexisting motivational systems on promotion and prevention will always happen. Promotion-oriented people are opportunistic and look for real experiences as motivation to develop action-oriented objectives, which are necessary to getting outcomes.
People who have a prevention orientation are extremely optimistic and see keeping things as they are and preventing bad things from happening as their defining and overriding motives.
To learn more about regulatory focus theory
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What is supply-side fiscal polioy? Identify each policy action as being focused on the demand side, the supply side, or both. Drag each item on the left to its matching item on the right. Note that every item may not have a match, while some items may have more than one match.
1. research grants for a corporation developing new technologies
2. government-funded scholarships for college students
both demand side supply side 3. stimulus packages for firms that are "too big to fail"
4. increasing spending on "shovel-ready" projects
5. lowering income tax rates at all income levels
Answer: Please refer to Explanation
Explanation:
Supply Side Fiscal Policy focuses on how to improve the ability of companies to supply more goods to the economy. The aim being that as companies supply more, they grow more and employ more people.
Demand Side Fiscal Policy on the other hand focuses on how to give more power to the Demand side of the Economy. It holds that increasing demand leads to increased supply which is good for the economy.
Classifying the above,
1. research grants for a corporation developing new technologies. SUPPLY SIDE.
This is aimed at increasing supply by improving the ways a company is able to produce it's goods and services.
2. government-funded scholarships for college students. SUPPLY SIDE.
This is supply side because it leads to more Colleges offering placement to students.
3. stimulus packages for firms that are "too big to fail". DEMAND SIDE.
Companies considered Too big to fail usually hire a lot of people. Keeping them running leads to them being able to pay off their employees which increases the demand in the economy.
4. increasing spending on "shovel-ready" projects. DEMAND SIDE.
Shovel Ready projects are those that are ready to be initiated. By increasing spending on them, they hire people immediately and begin work which increases the income flowing to people in the economy which increases demand.
5. lowering income tax rates at all income levels. BOTH.
By lowering income tax levels people are both able to spend more which increases demand as well as able to Invest more in companies which will increases supply.
Colgate-Palmolive Company has just paid an annual dividend of $ 1.09. Analysts are predicting dividends to grow by $ 0.19 per year over the next five years. After then, Colgate's earnings are expected to grow 5.3 % per year, and its dividend payout rate will remain constant. If Colgate's equity cost of capital is 7.5 % per year, what price does the dividend-discount model predict Colgate stock should sell for today?
Answer:
$74.62
Explanation:
Div₀ = $1.09
expected growth $0.19 per year
Div₁ = $1.28
Div₂ = $1.47
Div₃ = $1.66
Div₄ = $1.85
Div₅ = $2.04
then constant growth rte of 5.3%
equity cost = 7.5%
first we need to determine the stock price in year 5 using the Gordon growth model:
stock price = [dividend x (1+g)] / (Re - g) = ($2.04 x 1.053) / (7.5% - 5.3%) = $97.64
now we can discount all the future cash flows:
stock price = $1.28/1.075 + $1.47/1.075² + $1.66/1.075³ + $1.85/1.075⁴ + $2.04/1.075⁵ + $97.64/1.075⁵ = $1.19 + $1.27 + $1.34 + $1.39 + $1.42 + $68.01 = $74.62
There are some government programs that pay farmers not to plant wheat on part of their land.
This would help farmers:
A) by increasing total revenue but it hurts consumers.
B) by increasing prices for wheat by increasing total revenue and it also helps consumers by lowering the price of wheat.
C) since the government payment will reduce the costs of production and increase the supply of wheat.
D) since the government payment will increase income to farmers and it helps consumers too by lowering the price of wheat.
Answer:
Option D
Explanation:
In simple words, the payment by government will work as a subsidy for the lost profits of the farmers and their income will be ineffective. Also, by not using that land the farmers can grow any other crop which can provide them higher income as compared to crops.
Such step will result in higher total revenue as wheat would not get wasted due to extra production, thus consumers will also not get hurt.
Answer:
Answer is A
Explanation:
I vividly remember taking this in college last year for econ. I even pulled out my old paper work for the quiz (I snuck a copy home). It is A, don't listen to this "expert answer" person.