The normal balance (debit or credit) for each of the accounts are:
Assets with debit balances:
b. Office supplies
e. Accounts receivable
f. Prepaid Rent
h. Building
Normal balanceBased on double entry principle of accounting every debit entry must have a corresponding credit entry and every credit entry must have a corresponding debit entry.
Assets with debit balances:
b. Office supplies
e. Accounts receivable
f. Prepaid Rent
h. Building
Expenses or contra-equity accounts with a debit balance:
c. Owner withdrawals and d. Wages expense
Liability, revenue, and equity accounts with credit balances normal:
a. Fees earned
g. Wages payable
i. Owner capital
Inconclusion the normal balance (debit or credit) for each of the accounts are: Assets with debit balances:
b. Office supplies
e. Accounts receivable
f. Prepaid Rent
h. Building
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Bill jones inherited 5000 shares of stock priced at $50 per share. he does not want to sell the stock this year due to tax reasons but he is concerned that the stock will drop in value before year-end. Bill wants to buy put at $40 strike and sell calls at $50 strike to establish a collar to protect his inheritance. January call options with a strike of $50 are quoted at a cost of $2, and January puts with a $40 exercise price are quoted at a cost of $3. If Bill establishes the collar and the stock price winds up at $35 in January, Bill's net position value including the option profit or loss is _____
a. $195,000
b. $220,000
c. $175,000
d. $215,000
Answer:
a. $195,000
Explanation:
call strike price $50
call premium received $2
put strike price $40
put premium paid $3
you pay $2 - $3 = -$1
stock value $35
put value $5
call value -
premium paid -$1
net stock value $39
total # of stocks 5,000
portfolio's value $195,000
The estimated direct labor cost for February is closest to: Multiple Choice $456,000 $28,652 $253,460 $658,996
This question is incomplete, the complete question is;
Petrini Corporation makes one product and it provided the following information to help prepare the master budget for the next four months of operations: The budgeted selling price per unit is $110. Budgeted unit sales for January, February, March, and April are 7,500, 10,600, 12,000, and 11,700 units, respectively. All sales are on credit. Regarding credit sales, 30% are collected in the month of the sale and 70% in the following month. The ending finished goods inventory equals 30% of the following month's sales. The ending raw materials inventory equals 10% of the following month’s raw materials production needs. Each unit of finished goods requires 5 pounds of raw materials. The raw materials cost $4.00 per pound. Regarding raw materials purchases, 40% are paid for in the month of purchase and 60% in the following month. The direct labor wage rate is $23.00 per hour. Each unit of finished goods requires 2.6 direct labor-hours. Manufacturing overhead is entirely variable and is $8.00 per direct labor-hour. The variable selling and administrative expense per unit sold is $1.70. The fixed selling and administrative expense per month is $70,000.
The estimated direct labor cost for February is closest to: Multiple Choice $456,000 $28,652 $253,460 $658,996
Answer: The estimated direct labor cost for February is closest to D) $658,996.
Explanation:
Estimated direct labor cost for February =
Production units in February × Direct labor hours for each finished goods unit × Direct labor wage rate per hour
Ef = 11020 units × 2.6 labor hours per unit ×$23 per direct labor hour
Ff= $658,996
Also
Where Production units in February = February sales units + Ending finished goods units - Beginning finished goods units
Pf = 10600 units + (12000 units*30%) - (10600 units*30%)
Pf = 10600 units+3600 units-3180 units
Pf = 11020 units
Suppose that the dollar cost of producing x radios is c(x) = 800 + 40x - 0.2x2. Find the marginal cost when radios are produced.
Answer:
MC = 40 – 0.4x
Explanation:
Given the cost of producing the radio, C(X) = 800 + 40x – 0.2x^2
Now we have to find the marginal cost from the total cost. Since we know that the marginal cost can be derived from the total cost by taking the differentiation of total cost function with respect to x. therefore, below is the calculation of marginal cost.
C(X) = 800 + 40x – 0.2x^2
MC = d(c)/dx = 40 – 0.4x
MC = 40 – 0.4x
If you can buy a single paper towel roll for $1.99 or 24 rolls of paper towels for $12.99, what is this an example of?
Answer: c) Second Degree Price Discrimination
Explanation:
The company selling the paper towels is reducing the price per quantity as more quantities are added.
This is an example of Second Degree Price Discrimination . Here the seller sells different quantities at different prices with higher quantities usually getting lower prices as a result of trade discounts the goal of which is to encourage more sales as opposed to less.
For instance, you could pay $50 a month for gym but be charged $7 if you just want to use it for a day.
Data related to the inventories of Alpine Ski Equipment and Supplies is presented below: Skis Boots Apparel Supplies Selling price $ 160,000 $ 169,000 $ 107,000 $ 71,000 Cost 130,000 138,000 74,900 46,150 Replacement cost 120,000 119,000 111,000 42,150 Sales commission 10 % 10 % 10 % 10 % In applying the lower of cost or net realizable value rule, the inventory of apparel would be valued at:
Answer:
Alpine Ski Equipment and Supplies
In applying the lower of cost or net realizable value rule, the inventory of apparel would be valued at:
$74,900
Explanation:
a) Data and Calculations:
Inventories of Alpine Ski Equipment and Supplies:
Skis Boots Apparel Supplies
Selling price $ 160,000 $ 169,000 $ 107,000 $ 71,000
Cost 130,000 138,000 74,900 46,150
Replacement cost 120,000 119,000 111,000 42,150
Sales commission 10 % 10 % 10 % 10 %
Net realizable value $144,000 $152,100 $96,300 $63,900
Lower of cost or NRV $130,000 $138,000 $74,900 $46,150
b) Alpine Ski Equipment and Supplies applies the lower of cost or market rule by recording the cost of inventory at the lower of the original cost or its net realizable value. In all the product categories, the costs are lower than the net realizable values. To get the net realizable value for each product category, we deduct the sales commissions from their respective selling prices.
The common stock of the P.U.T.T. Corporation has been trading in a narrow price range for the past month, and you are convinced it is going to break far out of that range in the next three months. You do not know whether it will go up or down, however. The current price of the stock is $100 per share, and the price of a 3-month call option at an exercise price of $100 is $10. a. If the risk-free interest rate is 10% per year, what must be the price of a 3-month put option on P.U.T.T. stock at an exercise price of $100? (The stock pays no dividends.)
Answer:
A.$7.65
B. $17.65
C. $18.07
Explanation:
Calculation for the price of a 3-month put option on P.U.T.T. stock
Using this formula
P = C-S+[X/(1+r)T]
Where,
C represent call option price =$ 10
S represent spot price = $100
X represent exercise price =$100
T represent time period of put option =3 or 1/4months
R represent risk free return =10%
Let plug in the formula
P = C-S+[X/(1+r)T]
P = 10-100+[100/(1+0.10)1/4]
P = 10-100+[100/(1.10)1/4]
P = 10-100+[100/1.0241]
P = 10-100+97.65
P = 10-2.35
P = $7.65
Therefore the price of a 3 month put option stock will be $7.65
B. Calculation for What would be a simple options strategy .
The simple options strategy will be the straddle which will inturn enable the investor to buy one put option as well as one call option
Now let calculate for the The Total cost of straddle option
The Total cost of straddle option is = $10+$ 7.65
The Total cost of straddle option= $ 17.65.
The amount of amount of Total cost of straddle option will be $ 17.65.
C.Calculation for How far would it have to move in either direction inorder to make a profit ontl the initial investment
Inital investment Profit= $ 17.65×(1.10)^1/4
Initial investment Profit=$ 17.65×1.0241
Initial investment Profit= $ 18.07
As a part of the internal control over cash receipts by mail, the mailroom sends both the customer checks and the remittance advices to the accounting department.
a) true
b) false
Answer: False
Explanation:
From the question, we are informed that as a part of the internal control over cash receipts by mail, the mailroom sends both the customer checks and the remittance advices to the accounting department. This is not true.
It should be noted that the customer checks and the remittance advices are sent to the cashier and not the accounting department
A corporation originally issued $13 par value common stock for $15 per share. Which of the following is included in the entry to record the purchase of 300 shares of treasury stock for $11 per share?
A. Treasury Stock-Common is debited for $3,300.
B. Treasury Stock-Cormmon is debited for $1,650.
C. Retained Earnings is debited for $1,660.
D. Treasury Stock-Common is oodied for $46.
Answer:
A. Treasury Stock-Common is debited for $3,300.
Explanation:
Cost of the treasury stock purchased = 300 shares of treasury stock * $11 per share
Cost of the treasury stock purchased = $3,300
Gardiner, Inc. reported a retained earnings balance of $190,000 at December 31, 2024. In June 2025, Gardiner discovered that merchandise costing $20,000 had not been included as ending inventory in its 2024 financial statements. Also, a $50,000 accrued revenue was omitted on 12/31/24. Gardiner has a 20% tax rate. Assuming the correcting journal entry net of tax was recorded, what amount should Gardiner report as adjusted beginning retained earnings in its statement of retained earnings for year ended December 31, 2025?
Answer: $246,000
Explanation:
Merchandise costing $20,000 had been omitted from the Ending Inventory.
Ending inventory is deducted from Cost of Goods sold which means that the Cost of Goods sold was overstated by $20,000.
Cost of Goods sold are subtracted from sales to find Gross Income so if it was overstated then Income was understated by $20,000.
Accrued Revenue is to be added to Income so if it was omitted then income was understated by $50,000.
Income in total was therefore understated by = 20,000 + 50,000
= $70,000
The correcting entry is net of tax so;
= 70,000 * ( 1 - 20%)
= $56,000
Retained earnings will therefore be;
= 190,000 + 56,000
= $246,000
The cash cycle measures the days required to produce finished goods or delivered services. true/false
Answer: False
Explanation:
The cash cycle is also referred to as the cash conversion cycle and it is used to know the number of days it'll take companies to turn raw materials into making money.
It is the timeframe from buying raw materials for production purpose till the moment the product that was made is being sold and money gotten from the sale.
Successful advertising can increase demand across a wide spectrum of consumers, but it happens unevenly. Some consumers respond more dramatically than others to advertising. This explains the change in ________ of the demand curve that occurs after an advertising campaign.
Answer:
Elasticity.
Explanation:
Successful advertising can increase demand across a wide spectrum of consumers, but it happens unevenly. Some consumers respond more dramatically than others to advertising. This explains the change in elasticity of the demand curve that occurs after an advertising campaign. Thus, the more responsive consumers are to an advert, the more elastic the consumer demand is for the successful advertising technique used by the firm.
Employees in engineering and marketing divisions often disagree with each other about how to achieve targets mainly because they have unique backgrounds, experiences, and training. The most apparent source of conflict here is
Answer: differentiation
Explanation:
From the question, we are informed that employees in engineering and marketing divisions often disagree with each other about how to achieve targets mainly because they have unique backgrounds, experiences, and training.
The above source of conflict is due to differentiation. The differentiation is as a result of them not working in thesame divisions hence, they see things differently and not in the same way.
On the income statement of a merchandising company, interest income and interest expense are reported:
Answer: B. As separate items of other income and expense below the net operating income or loss
Explanation:
In a Merchandising company, the main revenue stream is not from interest revenue so when income from interest is received, it is not recorded with the normal revenue so as not to overstate revenue from operations. It will instead be recorded after the net operating income in the other income and expense section.
The same goes for finance costs such interest expenses. Income tax expense is also recorded here.
Given a stock with a beta of 1.2, risk free rate of 4%, and a market return of 10%, calculate the required return.
Answer: 11.2%
Explanation:
The required return of this stock can be calculated using the Capital Asset Pricing Model (CAPM) which is expressed as follows;
Required return = Risk free rate + beta ( Market return - risk free rate)
= 4% + 1.2 ( 10% - 4%)
= 11.2%
If there were 50000 pounds of raw materials on hand on January 1, 140000 pounds are desired for inventory at January 31, and 530000 pounds are required for January production, how many pounds of raw materials should be purchased in January?
Answer:
620,000 pounds
Explanation:
The computation of the number of pounds required raw material purchased in Jan is shown below:
Pounds of raw materials purchased is
= Pounds of material required for production + Desired Ending Inventory - Beginning Inventory
= 530,000 pounds + 140,000 pounds - 50,000 pounds
= 620,000 pounds
Hence, the number of pounds to be purchased is 620,000 pounds
There is no nation involved in global trade that still maintains a fixed value of their currency relative to a key currency or gold
a. true
b. false
Answer:
a. true
Explanation:
Gold is a currency that is the free market system that will fluctuate tp the form of exchange and no country in international trade can maintain a fixed value of its currency relative to the key currency though they can trade gold in multiple ways and can participate in price movements.What is NOT a major purpose of orientation and socialization? Reducing stress and anxiety Reducing employee benefits Reducing start-up costs Reducing employee turnover
Answer: Reducing employee benefits
Explanation:
When a new employee is added to the company, it is best to give them and orientation as well as to encourage other employees who have been there longer to talk to them. This can be beneficial to the employee because it will help them settle into the job faster, thus giving them more confidence to be able to overcome the stress an anxiety that may come with starting a new job.
It is also beneficial to the company as the employee will learn skills needed to survive in the job. This will reduce wastage that may accrue due to a lack of knowledge on the part of the employee of job procedure.
With the above two contributing to making the employee feel more comfortable as well as able to do their jobs, employees will have less reason to leave the job thereby reducing employee turnover.
Orientation and Socialization will not reduce employee benefits and so it is not a major purpose of the activity.
The accountant for Flagger Company prepared the following list of account balances from the company’s records for the year ended December 31:
Fees earned $165,000 Cash $30,000
Accounts receivable 14,000 Selling expenses 44,000
Equipment 42,000 Common stock 36,000
Accounts payable 12,000 Interest income 3,000
Salaries & wages expense 40,000 Rent expense 51,000
Income taxes payable 5,000 Prepaid Rent 2,000
Notes payable 20,000 Income taxes expense18,000
Prepare an income statement for Flagger Company in good form.
Flagger Company
Income Statement
For the Year Ended December 31
Revenues:
Accounts receivable $
Cash $
Expenses:
Rent expense $
Selling expenses
Salary and wages expense
Income taxes expense
Total expenses
Net income or loss $
Answer:
Net operating income $15,000
Explanation:
Flagger Company
Income statement for the year ended , 31 December
Fee earned
165,000
Less : Operating expenses
Salaries and wages 40,000
Rent expense. 51,000
(91,000)
Gross profit.
74,000
Less: Selling expense.
(44,000)
Profit before interest and tax.
30,000
Less interest expense.
(18,000)
12,000
Add: Interest income.
3,000
Net operating income.
15,000
The stock of Big Joe's has a beta of 1.40 and an expected return of 12.10 percent. The risk-free rate of return is 4.6 percent. What is the expected return on the market?
Answer:
5.403%
Explanation:
Calculation for the expected return on the market
Using this formula
Expected return =(Expected return-Risk-free rate of return)/Stock beta +Risk-free rate of return
Where,
Expected return=12.10%
Risk-free rate of return=4.6%
Stock beta =1.40%
Let plug in the formula
Expected return =(0.121-0.046)/0.014+0.046
Expected return =0.075/0.014+0.046
Expected return=5.357+0.046
Expected return =5.403%
Therefore the expected return on the market will be =5.403
which of the following is not a common type of meeting?
standing
planning
running
problem solving
Answer:
running is the answer for your question
Ben Gordon, Inc. manufactures 2 products, wheels and seats. The company has estimated its overhead in the assembling department to be $420000. The company produces 300000 wheels and 600000 seats each year. Each wheel uses 2 parts, and each seat uses 3 parts. How much of the assembly overhead should be allocated to wheels?
Answer:
$41,250
Explanation:
Given the following :
Total estimated overhead = $420,000
Number of wheels produced = 300,000 ; uses 2 Parts
Number of seats produced = 600,000 ; uses 3 parts
Number of wheels * part = (300,000 * 2) = 600,000
Number of seats * part = (600,000 * 3) = 1,800,000
Total = 600,000 + 1,800,000 = 2,400,000
Allocated overhead for wheels :
[wheels total / (wheels total + seat total)] * estimated overhead
(600,000 / 2,400,000) * $165,000
0.25 * $165,000
= $41,250
The idea behind the Kanban system is to authorize materials for production only if there is a need for them.a) trueb) false
Answer: True
Explanation:
Kanban is a Lean tool that is designed in order to reduce idle time that occurs during production. The Kanban system was put in place to remove wastages so that what the process needs will be delivered exactly when they are needed.
The idea behind the Kanban system is to authorize materials for production only if there is a need for them.
A team integrates and tests the Stories on the last day of the Iteration. This has become a pattern for the last three Iterations. Why is this considered an anti-pattern? g
Answer: Because the team is waterfalling the iteration
Explanation:
The options to the question are:
a. Because the team consistently meets their commitments, and the Product Owner accepts the stories
b. Because the team is waterfalling the iteration
c. Because the team demonstrates the full stories to the product owner during the iteration review.
d. Because it is difficult to manage dependencies with other teams.
An anti-pattern is a pattern that show that a particular idea will be ineffective, risky and can create further havoc.
Therefore, based on the scenario that a team integrates and tests the stories on the last day of the Iteration which has become a pattern for the last three Iterations.
This is an anti pattern because the team is waterfalling the iteration since the stories are tested on the last day therefore it'll be hard for any adjustments to be made.
When do many companies expect to have a net loss? (Select three answers)
a. after they break even
b. when they have a gross profit
c. when they are first getting established
d. before they start having operating expenses
Answer:
C- When they are first getting established
Explanation:
Edge 2022
Which of the following would be least likely to be considered a managerial accounting report?
A. a report to analyze potential efficiencies and savings for the purchase of new production equipment
B. a schedule of total manufacturing costs incurred
C. a statement of cost of goods manufactured
D. a statement of stockholders’ equity
Answer: a statement of stockholders’ equity
Explanation:
Out of the options that are given, the ones that are likely to be considered a managerial accounting report are a report to analyze potential efficiencies and savings for the purchase of new production equipment, a schedule of total manufacturing costs incurred and a statement of cost of goods manufactured.
Therefore, the least likely to be considered will be a statement of stockholders’ equity.
Products such as steel, bulk chemicals, and industrial electronics do not require much differentiation because the taste and preference for these products is similar all around the world. These products are examples of g
Answer:
universal needs.
Explanation:
Universal needs products are those that do not require much differentiation because they are products that will generally become other products, that is, steel, bulk chemicals and industrial electronics are used all over the world to build other essential products in the world whole, such as industrial equipment, household appliances, means of transport, etc.
If the Open Market Purchase is $1 billion by approximately how much will the supply of Money increase
Answer: $10 billion
Explanation:
Increase in the money supply can be calculated by multiplying the injection of cash into the economy by the Money Multiplier which is calculated as;
= 1/ reserve ratio
Reserve ratio = 10%
Money Multiplier = 1 / 10%
= 10
The money supply will therefore increase by;
= 1,000,000,000 * 10
= $10,000,000,000
= $10 billion
What are the two methods used to translate financial statements and how does the functional currency play a role in determining which method is used? Provide academic support in your response.
Answer:
The two methods of translating financial statements are the current rate method/closing rate method and the temporal method
Explanation:
Functional currency simply means the main currency used by a business. it could also be defined as the primary currency used in the economic environment in which a business operates as in where it generates most of its cash and also spends it
Functional currency determines to a large extent the method used in translation of financial statements. When there is no difference between local currency and foreign currency, current rate method is used and vice versa for temporal rate method
please find attached from Advanced Accounting
Hoyle, J., Schaefer, T., & Doupnik, T. (2015)
Porter Inc's stock has an expected return of 10.75%, a beta of 1.25, and is in equilibrium. If the risk-free rate is 5%, what is the expected market risk premium
Answer:
the expected market risk premium is 4.6%
Explanation:
The computation of the expected market risk premium is shown below:
As we know that
Expected rate of return = Risk free rate of return + beta × market risk premium
10.75% = 5% + 1.25 × market risk premium
5.75% = 1.25 × market risk premium
So, the market risk premium is
= 5.75% ÷ 1.25
= 4.6%
hence, the expected market risk premium is 4.6%
we simply applied the above formula
Suppose that the risk-free rate is 5% and that the market risk premium is 7%. What is the required return on (1) the market, (2) a stock with a beta of 1.0, and (3) a stock with a beta of 1.7? Ehrhardt, Michael C.. Corporate Finance: A Focused Approach (p. 286). Cengage Learning. Kindle Edition.
Answer:
1.
r market = 0.12 or 12%
2.
r stock = 0.12 or 12%
3.
r Stock = 0.169 or 16.9%
Explanation:
The required rate of return can be calculated using the CAPM or Capital asset pricing model equation. The formula for required rate of return under this model is,
r = rRF + Beta * rpM
Where,
rRF is the risk free raterpM is the risk premium on marketr represents the required rate of return1.
The beta of the market is always considered to be 1. Thus, the required rate of return on market would be,
r market = 0.05 + 1 * 0.07
r market = 0.12 or 12%
2.
For a stock whose beta is 1.0, the required rate of return would be same as that for market. So, the required rate of return for a stock with a beta of 1.0 is,
r Stock = 0.05 + 1 * 0.07
r Stock = 0.12 or 12%
3.
The required rate of return for a stock with a beta of 1.7 is,
r Stock = 0.05 + 1.7 * 0.07
r Stock = 0.169 or 16.9%