Answer:
b
Explanation:
The trial balance of Barger Company at the end of the accounting period, immediately prior to recording closing entries, showed the following:________.
Debit Credit
Cash 29,000
Land 56,000
Notes payable 32,400
Common stock 22,000
Retained earnings 15,800
Service revenue 62,000
Expenses 44,900
Dividends 2,300
Total $ 132,200 $ 132,200
What will the balance of the retained earnings account be after the closing entries are recorded?
Answer: $30,600
Explanation:
First calculate the earnings for the year.
Revenue is given. Expenses are also given and come out of revenue. Dividends also come out of revenue as well.
Retained Earnings for the year is therefore,
Retained Earnings for the year = Revenue - Expenses - Dividends
= 62,000 - 44,900 - 2,300
Retained Earnings for the year = $14,800
This figure should be added to the retained earnings of the previous period to find the total balance.
= 14,800 + 15,800
= $30,600
$30,600 is the closing Balance on Retained Earnings after closing entries.
Raner, Harris, & Chan is a consulting firm that specializes in information systems for medical and dental clinics. The firm has two offices—one in Chicago and one in Minneapolis. The firm classifies the direct costs of consulting jobs as variable costs. A contribution format segmented income statement for the company’s most recent year is given below:
Required:
1-a. Compute the companywide break-even point in dollar sales. (Round "CM ratio" to 2 decimal places and final answer to the nearest whole dollar amount.)
1-b. Compute the break-even point for the Chicago office and for the Minneapolis office. (Round "CM ratio" to 2 decimal places and final answers to the nearest whole dollar amount.)
1-c. Is the companywide break-even point greater than, less than, or equal to the sum of the Chicago and Minneapolis break-even points?
Greater than
Less than
Equal to
2. By how much would the company’s net operating income increase if Minneapolis increased its sales by $48,750 per year? Assume no change in cost behavior patterns.
3. Refer to the original data. Assume that sales in Chicago increase by $32,500 next year and that sales in Minneapolis remain unchanged. Assume no change in fixed costs.
a. Prepare a new segmented income statement for the company. (Round your percentage answers to 1 decimal place (i.e.1234 should be entered as 12.3)
Answer:
Explanation:
1a
Break-even point in dollar sales 406957 =(109200+78000)/46%
1b
Break even point
Chicago office 72429 =50700/70%
Minneapolis office 146250 =58500/40%
1c
Greater than
2
Increase in sales 48750
X CM ratio 40%
Net operating income increase 19500
3
Total company Chicago Minneapolis
Amount % Amount % Amount %
Sales 520000 100.0% 130000 100.0% 390000 100.0%
Variable expenses 273000 52.5% 39000 30.0% 234000 60.0%
Contribution margin 247000 47.5% 91000 70.0% 156000 40.0%
Traceable fixed expenses 109200 21.0% 50700 39.0% 58500 15.0%
Office segment margin 137800 26.5% 40300 31.0% 97500 25.0%
Common fixed expenses not traceable 78000 15.0%
Net operating income 59800
Lincoln Company issued $ 90,000 of​ 10-year, 9 % bonds payable on January​ 1, 2018. Lincoln Company pays interest each January 1 and July 1 and amortizes discount or premium by the​ straight-line amortization method. The company can issue its bonds payable under various conditions.
Requirements
1. Journalize Anderson Company's issuance of the bonds and first semiannual interest payment assuming the bonds were issued at face value. Explanations are not required.
2. Journalize Anderson Company's issuance of the bonds and first semiannual interest payment assuming the bonds were issued at 92. Explanations are not required.
3. Journalize Anderson Company's issuance of the bonds and first semiannual interest payment assuming the bonds were issued at 103. Explanations are not required.
4. Which bond price results in the most interest expense for Anderson Company? Explain in detail.
Answer:
1. Journalize Anderson Company's issuance of the bonds and first semiannual interest payment assuming the bonds were issued at face value. Explanations are not required.
Issuance of bonds:
Dr Cash 90,000
Cr Bonds payable 90,000
First coupon payment:
Dr Interest expense 4,050
Cr Cash 4,050
2. Journalize Anderson Company's issuance of the bonds and first semiannual interest payment assuming the bonds were issued at 92.
Issuance of bonds:
Dr Cash 82,800
Dr Discount on bonds payable 7,200
Cr Bonds payable 90,000
First coupon payment:
Dr Interest expense 4,410
Cr Cash 4,050
Cr Discount on bonds payable (= $7,200 / 20) 360
3. Journalize Anderson Company's issuance of the bonds and first semiannual interest payment assuming the bonds were issued at 103.
Issuance of bonds:
Dr Cash 92,700
Cr Bonds payable 90,000
Cr Premium on bonds payable 2,700
First coupon payment:
Dr Interest expense 3,915
Dr Premium on bonds payable (=$2,700 / 20) 135
Cr Cash 4,050
4. Which bond price results in the most interest expense for Anderson Company?
If the company sells its bonds at a price lower than face value (at a discount) it will receive less money for the bonds they owe. The discount that is recorded increases the amount of interest expense because even though the amount of cash paid doesn't change, the real interest is higher.
Explanation:
issued $90,000 in 9% bonds payable, 10 year maturity, semi annual coupon.
The following accounts appear in the ledger of Oriole Company after the books are closed at December 31, 2020.
Common Stock, no par, $2 stated value, 393,000 shares authorized; 284,000 shares issued $ 568,000
Common Stock Dividends Distributable 25,000
Paid-in Capital in Excess of Stated Value—Common Stock 1,110,000
Preferred Stock, $5 par value, 8%, 38,000 shares authorized; 28,700 shares issued 143,500
Retained Earnings 758,000
Treasury Stock (13,800 common shares) 96,600
Paid-in Capital in Excess of Par—Preferred Stock 343,000
Accumulated Other Comprehensive Loss 34,500
Prepare the stockholders’ equity section at December 31, 2020, assuming retained earnings is restricted for plant expansion in the amount of $112,000. For capital stock first enter the preferred stock details.
Answer and Explanation:
The preparation of the stockholders’ equity section at December 31, 2020 is presented below:
Oriole Company
Stockholders’ equity section
December 31, 2020
Particulars Amount
Stockholder equity:
Paid in capital:
Capital Stock
Preferred stock $143,500
Common Stock dividend $568,000
Common Stock Dividends Distributable $25,000 $593,000
Total capital stock $736,500
Additional paid in capital
Paid-in Capital in Excess of Par - Preferred Stock $343,000
Paid-in Capital in Excess of Stated Value - Common Stock $1,110,000
Total paid in capital $2,189,500
Add: Retained earnings $758,000
Total paid in capital and retained earnings $2,947,500
Less: Treasury stock -$96,600
Less: Accumulated Other Comprehensive Loss -$34,500
Total Stockholder equity $2,816,400
We deduct the treasury stock and the accumulated other comprehensive loss and rest items are added so that the total stockholder equity could arrive
Answer:
15.02
Explanation:
because of the section
On January 1, Hillcrest Co. acquired a 40% interest in Preston, Inc. with the excess of purchase price over book value solely attributable to equipment with a ten-year life and undervaluation by $250,000. During the year of acquisition, Preston reported net income of $500,000. What amount of Equity Income should Hillcrest report on its income statement for the year of acquisition? Select one: A. $200,000 B. $210,000 C. $190,000 D. $250,000
Answer:
C. $190,000
Explanation:
As per the given question the solution of Income reported on Income statement is provided below:-
here, we ill find first share in equity income and depreciation expenses on undervalue equipment to reach the i ncome reported on Income statement
Share in equity income = Net income × Interest
= $500,000 × 40%
= $200,000
Depreciation expenses on undervalue equipment = undervaluation ÷ Number of years × Interest
= $250,000 ÷ 10 × 40%
= $10,000
Income reported on Income statement = Share in equity income -Depreciation expenses on undervalue equipment
= $200,000 - $10,000
= $190,000
George Wynn is a salesperson for EGC whose primary responsibility is to contact engineers in charge of constructing commercial buildings. One such engineer is Don Snyder, who is in charge of building the new Texas A&M College of Business Administration facility. Don’s Houston-based engineering firm purchased three new EGI portable generators for this project. George learned that Don’s company will build four more buildings on the Texas A&M campus, and he felt that Don might buy more machines. Salesperson: Don, I understand you have three of our new model electric generators. Buyer: Yeah, you’re not kidding. Salesperson: I’m sure you’ll need additional units on these new jobs. Buyer: Yeah, we sure will. Salesperson: I’ve gone over the building’s proposed floor plans and put together the type of products you need. Buyer: They buy down in Houston; you need to see them! Salesperson: I was just in there yesterday, and they said it was up to you. Buyer: Well, I’m busy today. Salesperson: Can I see you tomorrow? Buyer: No need; I don’t want any more of your lousy generators! Salesperson: What do you mean? That is our most modern design! Buyer: Those so-called new fuses of yours are exploding after five minutes’ use. The autotransformer starter won’t start. . . . Did you see the lights dim? That’s another fuse blowing. Question George Wynn feels pressured to sell the new EGI. Don Snyder’s business represents an important sale both now and in the future. If you were George, what would you do?1. Have EGC’s best engineer contact Don to explain the generator’s capabilities.2. Come back after Don has cooled down.3. Get Don to talk about problems and then solve them.
Answer:
1. Have EGC best engineer contact Don to explain the generators capabilities.
Explanation:
I think the reasons why the generators were not working well were because they were being used for the work that was beyond their capacities.
And Don did not understand this, so the best thing to do is to do as a salesperson is to get the company's engineers involved, they will be in better position to explain the whole things to Don.
The income statement of Vince Gill Company is shown below.
VINCE GILL COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2017
Sales revenue
$6,900,000
Cost of goods sold
Beginning inventory
$1,900,000
Purchases
4,400,000
Goods available for sale
6,300,000
Ending inventory
1,600,000
Cost of goods sold
4,700,000
Gross profit
2,200,000
Operating expenses
Selling expenses
450,000
Administrative expenses
700,000
1,150,000
Net income
$1,050,000
Additional information:
1. Accounts receivable decreased $360,000 during the year.
2. Prepaid expenses increased $170,000 during the year.
3. Accounts payable to suppliers of merchandise decreased $275,000 during the year.
4. Accrued expenses payable decreased $100,000 during the year.
5. Administrative expenses include depreciation expense of $60,000.
Prepare the operating activities section of the statement of cash flows for the year ended December 31, 2017, for Vince Gill Company, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Answer and Explanation:
The preparation of the operating activities section of the statement of cash flows is presented below:
Vince Gill Company
Operating activities section
Statement of cash flows
For the year ended December 31, 2017
Cash flow from operating activities
Net operating income $1,050,000
Adjustment made
Add: Depreciation expenses $60,000
Add: Decrease in account receivable $360,000
Add: Decrease in inventory $300,000 ($1,600,000 - $1,900,000)
Less: Increase in prepaid expenses -$170,000
Less: Decrease in accrued expenses -$100,000
Less: Decrease in account payable -$275,000
Net cash provided by operating activities $1,225,000
The following information applies to the questions displayed below.
The December 31, 2021, unadjusted trial balance for Demon Deacons Corporation is presented below.
Debit $ 8,400 13,400 5,280 2,400 Accounts Credit Cash Accounts Receivable Prepaid Rent Supplies Deferred Revenue Common Stock Retained Earnings Service Revenue Salaries Expense 1,400 11,000 4,400 39, 680 27,000 $56,480 $56,480 At year-end, the following additional information is available
1. The balance of Prepaid Rent, $5,280, represents payment on October 31, 2021, for rent from November 1, 2021,
2. The balance of Deferred Revenue, $1,400, represents payment in advance from a customer. By the end of the .
3. An additional $700 in salaries is owed to employees at the end of the year but will not be paid until January 4
4. The balance of Supplies, $2,400, represents the amount of office supplies on hand at the beginning of the year to April 30, 2022 year, $350 of the services have been provided. 2022 of $900 plus an additional $1,500 purchased throughout 2021. By the end of 2021, only $640 of supplies remains.
Find the given attachment
A department using the FIFO method for process costing begins the month with 10,000 units which were 70% complete at the end of the previous month. They started and completed 50,000 units and their ending work in process inventory consisted of 5,000 units which were 10% complete. The costs incurred were $200,000.
Required:
A) The cost per equivalent unit of production, using the FIFO method is $ ____________ . Round your answer to two decimal places.
Answer:
$3.74 per equivalent unit
Explanation:
beginning WIP 10,000 units, which were 70% complete = 7,000 equivalent units
units started and completed during the month 50,000
ending WIP 5,000, which were 10% complete = 500 equivalent units
costs incurred = $200,000
under FIFO, total equivalent units:
beginning WIP completed (100% - 70%) x 10,000 = 3,000 units
+ units started and completed 50,000 units
+ ending WIP 5,000 x 10% = 500
total units = 53,500 equivalent units
cost per equivalent unit = $200,000 / 53,500 = $3.738 or $3.74 per equivalent unit
Here are selected data for Sunny Sky Corporation: Beginning raw materials inventory $37,000 Beginning work in process inventory $62,200 Beginning finished goods inventory $58,300 Cost of materials purchased $151,000 Cost of direct materials requisitioned $91,300 Direct labor incurred $135,000 Actual manufacturing overhead $160,000 Cost of goods manufactured $287,000 Cost of goods sold $265,000 Manufacturing overhead rate (per dollar of direct labor cost) $1.25 What is the finished goods ending inventory
Answer:
Value of closing inventory = $60,300
Explanation:
The closing inventory represents the value of goods available for sale but yet to be sold as at the end of a particular period of time . It is calculated as follows:
Closing inventory = opening inventory + goods manufactured - cost of goods sold
58,300 + 287,000 - 285,000 = 60,300
Value of closing inventory = $60,300
In December 2016, Custom Mfg. established its predetermined overhead rate for jobs produced during 2017 by using the following cost predictions: overhead costs, $460,000, and direct materials costs, $200,000. At year-end 2017, the company’s records show that actual overhead costs for the year are $1,271,100. Actual direct material cost had been assigned to jobs as follows.
Jobs completed and sold $ 420,000
Jobs in finished goods inventory 76,000
Jobs in work in process inventory 53,000
Total actual direct materials cost $ 549,000
1. Determine the predetermined overhead rate for 2017.
2&3. Enter the overhead costs incurred and the amounts applied during the year using the predetermined overhead rate and determine whether overhead is overapplied or underapplied.
4. Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold.
Complete this question by entering your answers in the tabs below.
Req 1
Req 2 and 3
Req 4
Determine the predetermined overhead rate for 2017.
Overhead Rate
Choose Numerator: / Choose Denominator:
Complete this question by entering your answers in the tabs below.
Req 1
Req 2 and 3
Req 4
Enter the overhead costs incurred and the amounts applied during the year using the predetermined overhead rate and determine whether overhead is overapplied or underapplied.
Factory Overhead
Actual overhead
Applied overhead
Underapplied overhead 0 = Overhead Rate
Estimated overhead costs / Estimated direct material costs = Overhead rate
/ = 0
Prepare the adjusting entry to allocate any over- or underapplied overhead to Cost of Goods Sold.
No Date General Journal Debit Credit
1 Dec 31 Cost of goods sold
1 Factory overhead
Answer:
1. Predetermined Overhead Rate 2.3
2. Under applied Overhead $ 8300
3.Cost of goods sold $ 8,300 Dr
Factory overhead $ 8300 Cr
Explanation:
As direct labor is not given overhead rate is calculated on the basis of direct material costs
Predetermined Overhead Rate= Estimated Overheads/ Estimated Direct Materials Cost
1. Predetermined Overhead Rate= $460,000/ $200,000= 2.3
Now we multiply the predetermined overhead rate with the actual material costs to get the aplpied overhead. And the difference is found.
Actual Overheads $1,271,100
Applied Overheads = 2.3 * $ 549,000 = $ 1262700
2. Under applied Overhead = Actual Overhead- Applied Overhead
= $1,271,100-$ 1262700= $ 8300
The under applied overhead is debited to Cost Of Goods Sold.
No Date General Journal Debit Credit
1 Dec 31 Cost of goods sold $ 8,300 Dr
1 Factory overhead $ 8300 Cr
Turnbull Corp. is in the process of constructing a new plant at a cost of $30 million. It expects the project to generate cash flows of $13,000,000, $23,000,000, and 29,000,000 over the next three years. The cost of capital is 20 percent. What is the net present value of this project? (Do not round intermediate computations. Round final answer to nearest million dollars) Group of answer choices $10 mil. $14 mil. $12 mil. $16 mil.
Answer:
$14 mil.
Explanation:
Net present value is the present value of after tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator:
Cash flow in year 0 = $-30 million
Cash flow in year 1 = $13,000,000
Cash flow in year 2 = $23,000,000
Cash flow in year 3 = 29,000,000
I = 20%
NPV = $13,587,630
To find the NPV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
ne year ago, a U.S. investor converted dollars to yen and purchased 100 shares of stock in a Japanese company at a price of 3,150 yen per share. The stock's total purchase cost was 315,000 yen. At the time of purchase, in the currency market 1 yen equaled $0.00952. Today, the stock is selling at a price of 3,465 yen per share, and in the currency market $1 equals 145 yen. The stock does not pay a dividend. If the investor were to sell the stock today and convert the proceeds back to dollars, what would be his realized return on his initial dollar investment from holding the stock
Answer:
realized loss = -20.31%
Explanation:
stock price ¥3,150, total operation ¥315,000
in US dollars = ¥315,000 x $0.00952 = $2,998.80
current market price ¥3,465, total operation ¥346,500
in US dollars = ¥346,500 / ¥145 = $2,389.66
realized loss = (current value in US dollars - initial investment) / initial investment = ($2,389.66 - $2,998.80) / $2,998.80 = -20.31%
Even though the stock price increased significantly (10%), the yen depreciated against the dollar even more (-38%)
On June 1, 2021, Andres Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2021. Under the terms of the contract, Andres will be paid a fixed fee of $56,000 per year and will receive an additional 15% of the fixed fee at the end of each year provided that building occupancy exceeds 90%. Andres estimates a 30% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract.
Required:
1. Assume Andres estimates variable consideration as the expected value. How much revenue should Andres recognize on this contract in 2021?
Answer:
429,260
Explanation:
Contract commencement date = July 1 , 2021
Contract payment term = $56,000 / annual
Additional 15% ($8,400) at the end of each year if occupancy exceeds 90%
Estimate of meeting occupancy threshold = 30%
At the year end 2012, Contract timeline = 6 month (1/2 year)
Base revenue recognized 56000/2 = $28,000
Additional payment = (8400*30% )/2 =$1260
Revenue recognized at December 31 , 2021 = $28000+ $1260 = $29,260
On January 1, 2019, Shay Company issues $290,000 of 11%, 20-year bonds. The bonds sell for $282,750. Six years later, on January 1, 2025, Shay retires these bonds by buying them on the open market for $303,050. All interest is accounted for and paid through December 31, 2024, the day before the purchase. The straight-line method is used to amortize any bond discount.
Required:
1. What is the amount of the discount on the bonds at issuance?
2. What is the carrying (book) value of the bonds as of the close of business on December 31, 2024?3. Prepare the journal entry to record the bond retirement.
Answer:
1.
$7,250
2.
$284,562.5
3.
Dr. Bond Payable $290,000
Dr. Loss on Retirement $18,487.5
Cr. Bond Discount $5,437.5
Cr. Cash $303,050
Explanation:
1.
Bond is issued on the discount when it is issued below the face value.
Discount value = Face value - Issuance value = $290,000 - $282,750 = $7,250
2.
Carrying value of the bond is the net of face value of the bond and un-amortised bond discount.
Carrying value = 290,000 - ($7,250 x (20-5) / 20) = $284,562.5
3.
Bond Discount = $7,250 x 15/20 = $5,437.5
Fire Department Turns to BI Analytics. New York City has nearly one million buildings, and each year, more than 3000 of them experience a major fire. The Fire Department of the City of New York (FDNY) is adding BI analytics to its arsenal of firefighting equipment. It has created a database of over 60 different factors (e.g., building location, age of the building, whether it has electrical issues, the number, and location of sprinklers) in an attempt to determine which buildings are more likely to have a fire than others. The values of these parameters for each building are fed into a BI analytics system that assigns each of the city's 330,000 inspectable buildings a risk score. (FDNY doesn't inspect single and two-family homes.) Building inspectors then use these risk scores to prioritize which buildings to visit on their weekly inspections. The FDNY has roughly 350 inspectors who are trained and certified to perform their duties.
Which set of three parameters all provides measures useful in determining which buildings are more likely to have a fire than others?
a. Year the building was constructed, the number of building occupants, and primary materials used in the construction of the building
b. Primary materials used in the construction of the building, the assessed value for property taxes, and distance from the nearest fire station
c. Distance from the nearest fire hydrant, whether or not the building has an elevator, and the number of stories in the building
d. The amount the building is insured for, distance from the nearest fire hydrant, and primary building materials used in the construction of the building
Answer:D
Explanation:
Caba Corporation’s sales budget for the first half of the year is as follows: Budgeted Sales January $ 115,000 February $ 198,000 March $ 220,000 April $ 250,000 May $ 210,000 June $ 290,000 Total: $ 1,283,000 Sales are 30% cash and 70% on account. Sales on account are to be collected over a three-month period, with 20% collected in the month of the sale, 65% collected in the first month following the sale, and 15% collected in the second month following the sale. What is the budgeted balance in the Accounts Receivable account as of June 30?
Answer:
$210,550
Explanation:
The accounts receivable represents the amount yet uncollected from sales made on credit.
Given that sales on account/credit are to be collected in the format; 20% collected in the month of the sale, 65% collected in the first month following the sale, and 15% collected in the second month following the sale and 70% of sales are on account, the budgeted balance in the Accounts Receivable account as of June 30 will be made of;
80% * 70% of sales in June15% * 70% of sales in MayThis is equivalent to
80% * 70% * $290,000 + 15% * 70% * $210,000
= $210,550
Veys Limos, Inc., is considering the purchase of a limousine that would cost $155,776, would have a useful life of 7 years, and would have no salvage value. The limousine would bring in cash inflows of $32,000 per year in excess of its cash operating costs. Determine the internal rate of return on the investment in the new limousine.
Answer:
The IRR = 4.868, The present value of annuity table for 7 years = 10%
Explanation:
Solution:
Recall that:
Veys Limos Incorporation is considering buying a limousine cost of =$155,776.
The useful life = 7 years
The cash inflow of the limousine = $32,000 per year
Now,
We determine the internal rate of return on the investment in the new limousine.
Thus,
The Internal rate of return is calculated as follows:
$155776/$32,000
=4.868
So,
we check for the present value of annuity table for 7 years
Which is,
= 10%
Bonita Company's inventory records show the following data:
Units Unit Cost
Inventory, January 1 10000 $9.00
Purchases: June 18 9000 9.00
November 8 6000 8.00
A physical inventory on December 31 shows 3500 units on hand. Bonita sells the units for $15 each. The company has an effective tax rate of 20%. Bonita uses the periodic inventory method.
Required:
1. The weighted-average cost per unit is ___________.
O $8.52
O $8.53
O $9.10
O $8.76
Answer:
$8.76
Explanation:
Total cost of inventory = (10,000 * $9) + (9,000 * $9) + (6,000 * $8) = $219,000
Total units of inventory = 10,000 + 9,000 + 6,000 = 25,000
The weighted-average cost per unit = $219,000 / 25,000 = $8.76
Sundance Systems has the following transactions during July. July 5 Purchases 56 LCD televisions on account from Red River Supplies for $3,300 each, terms 3/10, n/30. July 8 Returns to Red River two televisions that had defective sound. July 13 Pays the full amount due to Red River. July 28 Sells remaining 54 televisions from July 5 for $3,800 each on account.
Required:
Record the transactions of Sundance Systems, assuming the company uses a perpetual inventory system.
Answer:
July 5
LCD televisions $184,800 (debit)
Trade Payable : Red River Supplies $184,800 (credit)
July 8
Trade Payable : Red River Supplies $6,600 (debit)
LCD televisions $6,600 (credit)
July 13
J1
Trade Payable : Red River Supplies $5,346 (debit)
Discount Received $5,346 (credit)
J2
Trade Payable : Red River Supplies $172,854 (debit)
Cash $172,854 (credit)
July 28
J1
Cost of Goods Sold $172,854 (debit)
LCD televisions $172,854 (credit)
J2
Trade Receivable $205,200 (debit)
Revenue $205,200 (credit)
Explanation:
July 5
Recognize Televisions Inventory and Recognize a Liability Account Payable
July 8
De-recognize the Liability and the Inventories to the extend to the amount of televisions returned to supplier
July 13
J1
Recognize the discount received from Supplier for prompt settlement of account within the credit terms of 3/10, n/30. (Account was settled within 10 days)
J2
De-recognize the liability on settlement of the Account
July 28
J1
Recognize cost of goods sold on the sale since the entity uses perpetual inventory method.
J2
Recognize an Asset - Trade Receivable and Revenue from Sale of the Televisions.
Phillip is actively engaged in the oil business and owns numerous oil leases in the Southwest. During the current year he made several trips to inspect oil wells on the leases and to consult about future oil wells to be drilled on these sites. As a result of these overnight trips, he paid the following:
Plane fares $4,000
Hotels 1,000
Meals 800
Entertaining lessees 500
Of the $6,300 in expenses incurred, he can claim as deductible expenses:
a. $6,300
b. $6,040
c. $5,650
d. $5,000
Answer:
$6300 ( A )
Explanation:
Total expenses made = plane fares + hotels + meals + entertaining leases
$4000 + $1000 + $800 + $500 = $6300
All the expenses incurred by Philip on his travels can be claimed as deductible expenses because the expenses were made as a result of Philips travel on behalf of the company and not on personal trips .
Therefore when he returns from the trip all expenses he incurred will be claimed as deductibles
Answer:
c. $5,650
Explanation:
When traveling for business trips the meals and entertaining lessees are paid 50 % by the business and 50 % by the employee according to the IRS.
The plane fares and the hotel lodging bills are apid by the company.
Philip can claim deductible expenses = Plane fares+ Hotels+ 50% of Meals + 50 % of Entertaining lessees
Deductible Expenses = $ 4000+ $ 1000 + 50% (800) + 50% (500)
Deductible Expenses = $ 4000+ $ 1000 + 400 + 250 = $ 5650
Philip can claim $ 5650 as deductible expenses.
Wiemers Corporation’s comparative balance sheets are presented below.
WIEMERS CORPORATION
Balance Sheets
December 31
2017 2016
Cash $ 4,500 $ 3,200
Accounts receivable (net) 20,800 23,300
Inventory 10,100 7,200
Land 19,500 26,400
Buildings 70,000 70,000
Accumulated depreciation—buildings (14,600 ) (10,600 )
Total $110,300 $119,500
Accounts payable $ 12,700 $ 31,100
Common stock 74,900 68,600
Retained earnings 22,700 19,800
Total $110,300 $119,500
Wiemers’s 2017 income statement included net sales of $110,000, cost of goods sold of $60,800, and net income of $15,000.
Required:
1. Compute the following ratios for 2017.
a. Current ratio.b. Acid-test ratio.c. Accounts receivable turnover.d. Inventory turnover.e. Profit margin
Answer:
a. Current ratio = 2.79
b. Acid-test ratio = 1.99
c. Accounts receivable turnover = 2.92 times
d. Inventory turnover = 6.02 times
e. Profit margin = 13.64%
Explanation:
2017 Ratios
a. Current ratio = Current Assets / Current Liabilities
= ($ 4,500 + $20,800 + $10,100) / $ 12,700
= 2.79
b. Acid-test ratio = Current Assets - Inventory / Current Liabilities
= ($ 4,500 + $20,800) / $ 12,700
= 1.99
c. Accounts receivable turnover = Cost of Sales / Accounts receivable
= $60,800 / 20,800
= 2.92 times
d. Inventory turnover = Cost of Sales / Inventory
= $60,800 / 10,100
= 6.02 times
e. Profit margin = Net Profit / Sales
= $15,000 / $110,000×100
= 13.64%
Chen Inc. accepted a two-year noninterest-bearing note for $605,000 on January 1, 2021. The note was accepted as payment for merchandise with a fair value of $500,000. The effective interest rate is 10%. What is the correct entry to record the note? Multiple Choice Notes receivable 605,000 Interest revenue 105,000 Cost of sales 500,000 Notes receivable 605,000 Accounts receivable 605,000 Notes receivable 605,000 Discount on notes receivable 105,000 Sales revenue 500,000 Notes receivable 500,000 Accounts receivable 500,000
Answer:
Notes receivable 605,000 Discount on notes receivable 105,000 Sales revenue 500,000
Explanation:
The Journal entry are as follow:
Notes receivable Dr, 605,000
To Discount on notes receivable $105,000
To Sales revenue $500,000
(Being notes receivable is recorded)
Therefore here we debited the Note receivable and sales revenue will be paid at the time of issuing sales statements. If notes interest free then the excess amount will be credited on the receivable note and adjusted monthly to interest income.
X Company acquired land in Costa Rica for a total cost of $45,000,000. Engineers conducted a study at an additional cost of $500,000 to determine that there were oil reserves that should yield approximately 1,000,000 barrels of oil. The purchase agreement includes a requirement that the land be restored when the oil has been extracted, which is expected to cost $1,300,000, after which the land is expected to be worth $4,500,000. In year 8, X Company incurred $200,000 in development costs and extracted and sold 130,000 barrels of oil. How much depletion will X Company recognize during year 8
Answer:
$5,525,000
Explanation:
For computation of depletion during year 8 first we need to find out depletion base and depletion charge per unit which is shown below:-
Depletion base = Acquisition Cost + Exploration Cost + Restoration Cost + Development Cost
= $45,000,000 + $500,000 + $1,300,000 + $200,000
= $47,000,000
and
Depletion Charge per unit of barrel
= (Depletion Base - Salvage Value) ÷ Units to be recovered
= ($47,000,000 - $4,500,000) ÷ 1,000,000
= $42,500,000 ÷ 1,000,000
= $42.5
now,
Depletion during year 8 = Depletion charge per barrel × Number of barrels extracted
= $42.5 × 130,000
= $5,525,000
Therefore for computing the depletion during year 8 we simply multiply the depletion charge per barrel with number of barrels extracted.
Waterway Industries owned 22500 shares of Carla Vista Co. purchased in 2017 for $618750. On December 15, 2020, Waterway declared a property dividend of all of its Carla Vista Co. shares on the basis of one share of Carla Vista for every 10 shares of Waterway common stock held by its stockholders. The property dividend was distributed on January 15, 2021. On the declaration date, the aggregate market price of the Carla Vista shares held by Waterway was $910000. The entry to record the declaration of the dividend would include a debit to Retained Earnings of:________
Answer:
I don't know sorry I think 123456789p
P & G Auto Parts sells parts to AAA Car Repair during 2021. P&G offers rebates of 3% on purchases up to $80,000 and 6% on purchases above $80,000 if the customer’s purchases for the year exceed $300,000. In the past, AAA normally purchases $400,000 in parts during a calendar year. On March 25, 2021, AAA Car Repair purchased $90,000 of parts.
Required:
1. The journal entry to record the purchase includes a ____________.
Answer:
Credit to sales revenue for $87,000
Explanation:
So, in the question above we are given the following parameters or information or data in order to be able to solve this question effectively and the data or parameters are;
=> " rebates of 3% on purchases up to $80,000 and 6% on purchases above $80,000 if the customer’s purchases for the year exceed $300,000"
=> "In the past, AAA normally purchases $400,000 in parts during a calendar year."
=>" On March 25, 2021, AAA Car Repair purchased $90,000 of parts."
Hence, the rebates on $80,000 purchases = 80000 × 3/100 = 2,400.
Rebates on purchases greater than $80,000 = (90,000 - 80,000) × 6/100 = 600.
Total rebate= 2400 + 600 = $3000.
Hence, the net sales revenue = sales - rebate = $90,000 - $3000 = $87,000.
Process further or sell Benjamin Signal Company produces products R, J, and C from a joint production process. Each product may be sold at the split-off point or be processed further. Joint production costs of $92,000 per year are allocated to the products based on the relative number of units produced Data for Benjamin's operations for the current year are as follows: Sales Value at Split-off $76,000 $71,000 $48,000
Units Produced 8,000 10,000 5,000 Allocated Joint Production Cost $32,000 $40,000 $20,000 Product R... Product J... Product C... Product R can be processed beyond the split-off point for an additional cost of $26,000 and can then be sold for $105,000. Product J can be processed beyond the split-off point for an additional cost of $38,000 and can then be sold for $117,000. Product C can be processed beyond the split-off point for an additional cost of $12,000 and can then be sold for $57,000
Required: Which products should be processed beyond the split-off point?
A. R $3,000 profit
B. J 8,000 profit
C (3,000) loss
So R and J should be processed beyond the split off point. (Show computations)
Answer:
Products R and J should be processed beyond split-off point
Explanation:
In determining whether or not a product should be further processed,the incremental benefit of further processing should be determined as follows:
incremental benefit/(cost)=sales value after split-additional cost of further processing-sales value at split-off point:
Product R =$105,000-$26,000-$76,000=$3,000
Product J=$117,000-$38,000-$71,000=$8,000
Product C=$57,000-$12,000-$48,000=-$3000
Product R and J should be processed further as they give profit of $3,000 and $8,000 respectively.
Product C should not be further processed as loss of $3,000 would result from that.
Sheridan, Inc. acquired 40% of Pina Corporation's voting stock on January 1, 2021 for $1060000. During 2021, Pina earned $364000 and paid dividends of $250000. Sheridan's 40% interest in Pina gives Sheridan the ability to exercise significant influence over Pina's operating and financial policies. During 2022, Pina earned $533000 and paid cash dividends of $138000 on April 1 and $138000 on October 1. On July 1, 2022, Sheridan sold half of its stock in Pina for $681000 cash. What should the gain be on sale of this investment in Sheridan's 2022 income statement?
Answer:
$102,500
Explanation:
As per the given question the solution of gain be on sale is provided below:-
For reaching the gain be on sale first we need to follow some steps which is following below:-
Step 1
December 31, 2021 Investment = Initial investment + Net income - Dividend
= $1,060,000 + ($364,000 × 40%) - ($250,000 × 40%)
= $1,060,000 + $145,600 - $100,000
= $1,205,600 - $100,000
= $1,105,600
Step 2
July 1,2022 Investment = December 31, 2021 Investment + Net income - Dividend
= $1,105,600 + ($533,000 × 6 months ÷ 12 months × 40%) - ($138,000 × 40%)
= $1,105,600 + $106,600 - $55,200
= $1,212,200 - $55,200
= $1,157,000
Step 3
Now, the investment half value = $1,157,000 ÷ 2
= $578,500
and finally
So, Gain = Stock - Half value of Investment
= $681,000 - $578,500
= $102,500
So, we have calculated the gain be on sale in Sheridan's 2022 income statement by using the above formula.
In the past, some people believed that the Fed routinely expanded the money supply during the presidential election years to help the incumbent president. For this question, assume that the Fed allows inflation to be 3% in every presidential election year instead of 2% in other years.If people form expectations adaptively, their expectations will ________ inflation so expansionary policy will____________. a) Overestimate; reduce the unemployment rate.b) Overestimate; increase the unemployment ratec) Underestimate; increase the unemployment rated) Underestimate; reduce the unemployment rate.e) Accurately estimate; not change the unemployment rate.
Answer:
Option c. Underestimate, increase the unemployment rate
Explanation:
ChipMaker is a company that produces computer chips. To gain an advantage over other computer chip makers, ChipMaker focuses on reducing its costs below all of its competitors and has aligned its value chain accordingly. Recently, several of ChipMaker's competitors have begun to reduce the company's competitive advantage. In response to this threat, ChipMaker has decided to add production capacity in an effort to lower costs. By increasing production volume in an effort to reduce costs, the company is pursuing which sources of cost advantage? technological advantages size differences and economies of scale first-mover advantage differential access to productive inputs
Answer:
The correct answer is: size differences and economies of scale.
Explanation:
To begin with, in order to obtain an advantage in the field of business and in that way to overcome the other competitors there are differentes way of getting that. One of them, the economies of scale, focus on decreasing the cost of the production by the act of increasing the amount of goods producted. In that order, more is better, therefore that when ChipMaker decided to add production capacity in an effort to lower costs it is pursuing size differences and economies of scale.