Answer:
Arcadia's opportunity cost of producing 1 pair of jeans is 2 bushels of corn, and Dolorium's opportunity cost of producing 1 pair of jeans is 4 bushels of corn. Therefore, Arcadia has a comparative advantage in the production of jeans, and Dolorium has a comparative advantage in the production of corn.
Explanation:
maximum production
jeans corn
Arcadia 20 40
Dolorium 16 64
initial production
jeans corn
Arcadia 15 10
Dolorium 4 48
Arcadia's opportunity costs:
jeans = 40 / 20 = 2 bushels of corn
corn = 20 / 40 = 0.5 pairs of jeans
Dolorium's opportunity costs:
jeans = 64 / 16 = 4 bushels of corn
corn = 16 / 64 = 0.25 pairs of jeans
Staley Co. manufactures computer monitors. The following is a summary of its basic cost and revenue data: Per Unit Percent Sales price $525 100 Variable costs 300 57 Unit contribution margin $225 43 Assume that Staley Co. is currently selling 500 computer monitors per month and monthly fixed costs are $75,000. Staley Co.'s margin of safety ratio (MOS%) if 500 units are sold would be (round intermediate calculation up to nearest whole number of units): Group of answer choices 33.2%. 20.5%. 17.7%. 19.5%. 23.7%.
Answer:
36%
Explanation:
Calculation for what Staley Co.'s margin of safety ratio (MOS%) if 500 units are sold would be
First step is to calculate the Break even point units using this formula
Break even point units =( Fixed cost / Contribution margin per unit)
Let plug in the formula
Break even point units= ($75,000 / $225)
Break even point units= 320 units
Second step is to calculate the Margin of safety sales in units using this formula
Margin of safety sales in units = Actual sales units - Break even sales units
Let plug in the formula
Margin of safety sales in units = 500 - 320
Margin of safety sales in units= 180
Now let calculate Margin of safety ratio using this formula
Margin of safety ratio = ( margin of safety units / Actual sales units) *100
Let plug in the formula
Margin of safety ratio= (180 / 500 ) *100
Margin of safety ratio= 36%
Therefore Staley Co.'s margin of safety ratio (MOS%) if 500 units are sold would be 36%
Jenna Jeffries started her business baking dog treats by investing cash of $1,000. During May, its first month of operations, Jenna's Barkery had revenues of $3,000, all of which was collected in cash. She paid her assistant $1,000 in cash and purchased $200 of supplies on account. The business paid cash dividends of $500.
Required:
Determine the balance in Cash at the end of the month.
Answer:
Cash balance= $500
Explanation:
Giving the following information:
Started her business baking dog treats by investing cash of $1,000.
Had revenues of $3,000.
She paid her assistant $1,000 in cash.
The business paid cash dividends of $500.
The cash account is affected by every entrance or exit of money. For example, if a purchase is made on account, the cash balance is not affected.
Cash balance= -1,000 + 3,000 - 1,000 - 500
Cash balance= $500
The balance in cash at the end of the month is $500.
Calculation of the closing cash balance:Since Jenna Jeffries started her business baking dog treats by investing cash of $1,000. During May, its first month of operations, Jenna's Barkery had revenues of $3,000, all of which was collected in cash. She paid her assistant $1,000 in cash and purchased $200 of supplies on account. The business paid cash dividends of $500.
So, the ending cash balance is
= -1,000 + 3,000 - 1,000 - 500
= $500
Hence, the balance in cash at the end of the month is $500.
Learn more about cash here: https://brainly.com/question/19552698
Santa Fe Corporation manufactured inventory in the United States and sold the inventory to customers in Mexico. Gross profit from the sale of the inventory was $247,000. Title to the inventory passed FOB: shipping point. How much of the gross profit is treated as foreign source income for purposes of computing the corporation's foreign tax credit in the current year
Answer: $0
Explanation:
FOB Shipping point means that the title passes to the buyers at the shipping point which in this case is the United States, the sale can be said to have occurred in the United States.
There will therefore be no foreign trade tax credit because the income from this transaction will be treated as having been earned in the United States (U.S. source income).
At year-end, salaries expense of $17,000 has been incurred by the company but is not yet paid to employees. Salaries payable
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
b. At its December 31 year-end, the company owes $325 of interest on a line-of-credit loan. That interest will not be paid until sometime in January of the next year. Interest payable
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.
c. At its December 31 year-end, the company holds a mortgage payable that has incurred $950 in annual interest that is neither recorded nor paid. The company intends to pay the interest on January 7 of the next year. Interest payable
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.
Answer:
Following are the responses to the given points:
Explanation:
For part A:
Payable Salary
for point 1 $0 $19,500
for point 2 $17,000 Cr $21,800
$41,300
for point 3 Accounts title Dr. Cr.
Salaries expense $17,000
Payable Salary $17,000
For part A: Payable Interest
for point 1 $0 $0
for point 2 $325 Cr. $325
$325
for point 3 Accounts title Dr. Cr.
Interest on Expense $325
Payable Interest $325
For part C: Payable Interest
for point 1 $0 $0
for point 2 $950 Cr. $950
$950
for point 3 Accounts title Dr. Cr.
Interest on Expense $950
Payable Interest $950
The following unadjusted trial balance is prepared at fiscal year-end for Nelson Company.
NELSON COMPANY Unadjusted Trial Balance January 31, 2017
Debit Credit
Cash $8,150
Merchandise inventory 14,500
Store supplies 5,500
Prepaid insurance 2,600
Store equipment 42,800
Accumulated depreciation—Store equipment $17,850
Accounts payable 16,000
J. Nelson, Capital 18,000
J. Nelson, Withdrawals 2,100
Sales 114,550
Sales discounts 1,850
Sales returns and allowances 2,000
Cost of goods sold 38,000
Depreciation expense—Store equipment 0
Salaries expense 27,200
Insurance expense 0
Rent expense 12,000
Store supplies expense 0
Advertising expense 9,700
Totals $166,400 $166,400
Rent expense and salaries expense are equally divided between selling activities and general and administrative activities. Nelson Company uses a perpetual inventory system.
Additional Information:
Store supplies still available at fiscal year-end amount to $2,800.
Expired insurance, an administrative expense, is $1,650 for the fiscal year.
Depreciation expense on store equipment, a selling expense, is $1,625 for the fiscal year.
To estimate shrinkage, a physical count of ending merchandise inventory is taken. It shows $10,800 of inventory is still available at fiscal year-end.
Required:
a. Using the above information prepare adjusting journal entries:
b. Prepare a multiple-step income statement for fiscal year 2017.
c. Prepare a single-step income statement for fiscal year 2017.
d. Compute the current ratio, acid-test ratio, and gross margin ratio as of January 31, 2017.
Answer:
Nelson Company
a. Adjusting Journal Entries:
Debit Supplies Expense $2,700
Credit Supplies $2,700
To record supplies expense.
Debit Insurance Expense $1,650
Credit Prepaid Insurance $1,650
To record insurance expense.
Debit Depreciation Expense $1,625
Credit Accumulated Depreciation $1,625
To record depreciation expense.
b. Multi-step Income Statement for the year ended January 31, 2017:
Sales $114,550
Sales returns and allowances 2,000
Net Sales 112,550
Cost of goods sold 38,000
Inventory Shrinkage 3,700 41,700
Gross profit $70,850
Depreciation expense- Store 1,625
Sales discounts 1,850
Salaries expense 13,600
Rent expense 6,000
Store supplies expense 2,700
Advertising expense 9,700
Total selling expenses $35,475
Administrative Expenses:
Salaries expense 13,600
Insurance expense 1,650
Rent expense 6,000
Total administrative expenses $21,250 $56,725
Net Income $14,125
c. Single-step Income Statement for the year ended January 31, 2017:
Sales $114,550
Sales discounts 1,850
Sales returns and allowances 2,000
Cost of goods sold 38,000
Inventory Shrinkage 3,700
Depreciation expense- Store 1,625
Salaries expense 27,200
Rent expense 12,000
Store supplies expense 2,700
Advertising expense 9,700
Insurance expense 1,650 $100,425
Net Income $14,125
d. Current Ratio = Current Assets/Current Liabilities
= $22,700/$16,000
= 1.42
Acid-test ratio = (Current assets - Inventory)/Current Liabilities
= ($22,700 -10,800)/$16,000
= 0.74
Gross margin ratio = Gross profit/Net Sales = $70,850/112,550 * 100
= 63%
Explanation:
a) Data and Calculations:
NELSON COMPANY Unadjusted Trial Balance January 31, 2017
Debit Credit
Cash $8,150
Merchandise inventory 14,500
Store supplies 5,500
Prepaid insurance 2,600
Store equipment 42,800
Accumulated depreciation -Store equipment $17,850
Accounts payable 16,000
J. Nelson, Capital 18,000
J. Nelson, Withdrawals 2,100
Sales 114,550
Sales discounts 1,850
Sales returns and allowances 2,000
Cost of goods sold 38,000
Depreciation expense- Store equipment 0
Salaries expense 27,200
Insurance expense 0
Rent expense 12,000
Store supplies expense 2,700
Advertising expense 9,700
Totals $166,400 $166,400
Adjustments:
Supplies Expense $2,700 Supplies $2,700
Insurance Expense $1,650 Prepaid Insurance $1,650
Depreciation Expense $1,625 Accumulated Depreciation $1,625
NELSON COMPANY
Adjusted Trial Balance January 31, 2017
Debit Credit
Cash $8,150
Merchandise inventory 10,800
Store supplies 2,800
Prepaid insurance 950
Store equipment 42,800
Accumulated depreciation -Store equipment $19,475
Accounts payable 16,000
J. Nelson, Capital 18,000
J. Nelson, Withdrawals 2,100
Sales 114,550
Sales discounts 1,850
Sales returns and allowances 2,000
Cost of goods sold 38,000
Inventory Shrinkage 3,700
Depreciation expense- Store 1,625
Salaries expense 27,200
Insurance expense 1,650
Rent expense 12,000
Store supplies expense 2,700
Advertising expense 9,700
Totals $168,025 $168,025
Current Assets:
Cash $8,150
Merchandise inventory 10,800
Store supplies 2,800
Prepaid insurance 950
Total current assets = $22,700
Current Liabilities:
Accounts payable 16,000
TheThe economic analysis of minimum wage involves both normative and positive analysis. Consider the following consequences of a minimum wage: a. The minimum wage law causes unemployment. b. Unemployment would be lower without a minimum wage law. c. Minimum wage laws benefit some workers and harm others. d. The minimum wage should be more than $7.25 per hour. economic analysis of minimum wage involves both normative and positive analysis. Consider the following consequences of a minimum wage:
Answer:
a. The minimum wage law causes unemployment. - Positive statement
This is a positive statement because it describes a factual statement about minimum wage. It does not say whether minimum wage is a good thing or not, even if the inherent quality of the statement can be somewhat inferred.
b. Unemployment would be lower without a minimum wage law. - Postive statement.
This is a positive statement for the same reasons as the statement above. Besides, this statement says exactly the opposite as the statement above.
c. Minimum wage laws benefit some workers and harm others. - Positive statement.
This statement is also positive, it does not establish whether minimum wage is a good or a bad, thing, and it also does not recommend any policy regarding minimum wage.
d. The minimum wage should be more than $7.25 per hour. - Normative statement.
This above is a normative statement. It clearly establishes a preference when it comes to minimum wage, and recommends a public policy according to it: $7.25 per hour.
The three dates related to a cash dividend include which of the following:
a. Date of declaration
b. Date of payment
c. Date of issuance
d. Date of record
e. Date of payable
Answer: a. Date of declaration
b. Date of payment
d. Date of record
Explanation:
The three dates that are related to a cash dividend are:
Date of declaration - This is the date that a particular company is being binded to pay its dividend.
Date of payment - This simply means the date when dividend is paid to the stockholders.
Date of record - This is the date for the identification of recipients.
At the end of its most recent accounting period, Hinch Corporation had a balance of Accounts Receivable of $725,000 and a credit balance in Allowance for Uncollectible Accounts of $4,800. An aging of Accounts Receivable performed at the end of that period determined that the balance in Allowance for Uncollectible Accounts should be $31,400. The adjusting entry to record Bad Debts Expense should include which of the following:
a. Debit to Bad Debts Expense of $26,600
b. Credit to Bad Debts Expense of $31,400
c. Debit to Bad Debts Expense of $36,200
d. Credit to Allowance for Uncollectible Accounts of $31,400
Answer:
a. Debit to Bad Debts Expense of $26,600
Explanation:
The computation of the bad debt expense is shown below:
= Allowance for uncollectible accounts - credit balance of allowance for uncollectible accounts
= $31,400 - $4,800
= $26,600
Hence, the first option is correct
Golden Eagle Company prepares monthly financial statements for its bank. The November 30 and December 31 adjusted trial balances include the following account information:
30-Nov 31-Dec
debit   credit debit credit
supplies $2,000 $3,500
prepaid Insurance $8,000 $6,000
salaries payable $11,000 $16,000
unearned revenue $3,000 $1,500
The following information also is known:
a. Purchases of supplies during December total $3,500.
b. Supplies on hand at the end of December equal $3,000.
c. No insurance payments are made in December.
d. Insurance cost is $1,500 per month.
e. November salaries payable of $10,000 were paid to employees in December. Additional salaries for December owed at the end of the year are $15,000. On November 1, a tenant paid Golden Eagle $3,000 in advance rent for the period November through January, and Deferred Revenue was credited for the entire amount.
Required:
Show the adjusting entries that were made for supplies, prepaid insurance, salaries payable, and unearned revenue on December 31.
Answer:
Golden Eagle Company
Adjusting Journal Entries:
a. Debit Supplies $3,500
Credit Cash $3,500
To record the purchase of supplies during December.
b. Debit Supplies Expense $2,500
Credit Supplies $2,500
To record the used supplies for the month.
d. Debit Insurance Expense $1,500
Credit Prepaid Insurance $1,500
To record expired insurance expense for the month.
e. Debit Salaries Payable $10,000
Credit Cash $10,000
To record the payment of salary arrears.
f. Debit Salaries Expense $15,000
Credit Salaries Payable $15,000
To record unpaid salaries for the month.
g. Debit Unearned Revenue $1,000
Credit Earned Revenue $1,000
To record earned revenue for the month.
Explanation:
a) Data and Calculations:
Golden Eagle Company
Adjusted Trial Balances as of November 30 and December 31 (Partial):
30-Nov 31-Dec
Debit Credit Debit Credit
supplies $2,000 $3,500
prepaid Insurance $8,000 $6,000
salaries payable $11,000 $16,000
unearned revenue $3,000 $1,500
Adjusting Entries for Supplies, Prepaid Insurance, Salaries Payable and Unearned Revenue on December 31:
a. Supplies $3,500 Cash $3,500
b. Supplies Expense $2,500 Supplies $2,500
d. Insurance Expense $1,500 Prepaid Insurance $1,500
e. Salaries Payable $10,000 Cash $10,000
f. Salaries Expense $15,000 Salaries Payable $15,000
g. Unearned Revenue $1,000 Earned Revenue $1,000
Rivera Company manufactured two products, A and B, during April. For purposes of product costing, an overhead rate of $2.00 per direct-labor hour was used, based on budgeted annual factory overhead of $500,000 and 250,000 budgeted annual direct-labor hours, as follows:
Budgeted Overhead Budgeted Hours
Department 1 $300,000 200,000
Department 2 200,000 50,000
$500,000 250,000
The number of labor hours required to manufacture each of these products was:
Product A Product B
In Department 1 3 1
In Department 2 1 3
Total 4 4
During April, production units for products A and B were 1,000 and 3,000, respectively.
Required:
a. Using a plantwide overhead rate, what are total overhead costs assigned to products A and B, respectively?
b. Using departmental overhead rates, what are total overhead costs assigned to products A and B, respectively?
c. Assume that materials and labor costs per unit of Product B are $10 and that the selling price is established by adding 40% of total costs to cover profit and selling and administrative expenses.What difference in selling price would result from the use of departmental overhead rates?
Solution :
a). The assigned total cost is :
[tex]$A =\$ \ 8000$[/tex]
[tex]$B =\$ \ 24,000$[/tex]
Total overheads $ 500,000
Total hours 250,000
Plantwide overhead rate $ 2
Cost assigned to :
A ( 2 x 4 x 1000) $ 8,000
B ( 2 x 4 x 3000) $ 24,000
b). Department 1 Department 2
Overheads $ 300,000 $ 200,000
Hours 200,000 50,000
Overhead rate $ 1.50 $ 4.00
Overheads for the product A $ 8,500
(1.5 x 3 + 4 x 1) x 1000
Overheads for the product B $ 40,500
(1.5 x 3 + 4 x 1) x 3000
c). Plant wide Departmental
material and labor $ 10 $ 10
overheads $ 8 $ 13.50
Total $ 18.00 $ 23.50
Add: profit $ 7.20 $ 9.40
Selling price $ 25.20 $ 32.90
The difference $ 7.70
Therefore, the increase in the selling price = $ 7.70
A corporation had the following assets and liabilities at the beginning and end of this year.
Assets Liabilities
Beginning of the year $57,000 $24,436
End of the year 115,000 46,575
A. Owner made no investments in the business, and no dividends were paid during the year.
B. Owner made no investments in the business, but dividends were $1,500 cash per month.
C. No dividends were paid during the year, but the owner did invest an additional $45,000 cash in exchange for common stock.
D. Dividends were $1,500 cash per month, and the owner invested an additional $35,000 cash in exchange for common stock.
Determine the net income earned or net loss incurred by the business during the year for each of the above separate cases.
Answer:
Net Income / Net Loss:
Scenario A $35,888 (-58,000 + 22,112)
Scenario B $37,088 (-58,000 + 22,112 + 1,500)
Scenario C -$9,112 (-58,000 + 45,000 + 22,112)
Scenario D $17,112 (-58,000 + 35,000 + 22,112 + 18,000)
Explanation:
a) Data and Calculations:
Beginning Ending
Assets $57,000 $24,463
Liabilities 115,000 46,575
Equity (58,000) ($22,112)
Net Income / Net Loss:
Scenario A $35,888 (-58,000 + 22,112)
Scenario B $37,088 (-58,000 + 22,112 + 1,500)
Scenario C -$9,112 (-58,000 + 45,000 + 22,112)
Scenario D $17,112 (-58,000 + 35,000 + 22,112 + 18,000)
b) The net income is the difference between the beginning equity plus new investments and the ending equity and dividends.
Steelweld, a car parts manufacturer, pays employees a higher hourly rate as they learn to master more parts of the work process. Employees earn $10 per hour when they are hired and they can earn up to $20 per hour if they master all 12 work units in the production process. What is most likely a benefit Steelweld is trying to achieve with this reward system?
Answer:
The improvement of workforce flexibility
Explanation:
The work force flexibility may be defined as the strategy of the responding to changing circumstances as well as expectations. It lays emphasizes on the flexibility and the willingness to adapt to change. The employees who approach their work with a flexible mindset are highly valued by the employers.
In the context, Steelweld company pays their employees at a higher hourly rate when they learn to master more work skills. The employees are paid much higher when they master all the 12 work units than they were hired. By doing this, the Steelweld company is trying to benefit and improve the workforce flexibility in their company.
g Novak Corp. started the year with $73200 in its Common Stock account and a credit balance in Retained Earnings of $53700. During the year, the company earned net income of $58600, and declared and paid $24400 of dividends. In addition, the company sold additional common stock amounting to $34200. As a result, the balance in retained earnings at the end of the year would be
Answer:
the ending retained earnings balance is $87,900
Explanation:
The computation of the ending retained earnings balance is shown below:
= opening retained earning balance + net income - dividend paid
= $53,700 + $58,600 - $24,400
= $87,900
Hence, the ending retained earnings balance is $87,900
We simply applied the above formula
From a salesperson's perspective, the characteristics of a good manager: A. vary from manager to manager. B. conflict with the characteristics managers list as being traits of a good manager. C. are a rarity in modern sales organizations. D. include friendship and loyalty E. include flexibility and a team orientation.
Answer:
E. include flexibility and a team orientation.
Explanation:
Sales management is the process that maintains customers sales by planning, direction and control of the sales process.
It involves motivation, supervising, delegation, and equipping of the sales force.
This is a people oriented career and therefore requires flexibility and a team orientation. So the team is able to adapt to new strategies aimed at improving the sales process.
Transactions Concrete Consulting Co. has the following accounts in its ledger: Cash; Accounts Receivable; Supplies; Office Equipment; Accounts Payable; Jason Payne, Capital; Jason Payne, Drawing; Fees Earned; Rent Expense; Advertising Expense; Utilities Expense; Miscellaneous Expense.
Transactions:
Oct. 1 Paid rent for the month, $2,800.
3 Paid advertising expense, $525.
5 Paid cash for supplies, $1,250.
6 Purchased office equipment on account, $9,300.
10 Received cash from customers on account, $16,600.
15 Paid creditors on account, $3,720.
27 Paid cash for miscellaneous expenses, $590.
30 Paid telephone bill (utility expense) for the month, $275.
31 Fees earned and billed to customers for the month, $50,160.
31 Paid electricity bill (utility expense) for the month, $830.
31 Withdrew cash for personal use, $1,700.
Journalize the following selected transactions for October 2019.
Answer:
Oct 1
Rent expense Dr. $2800
Cash Cr. $2800
(To record entry for payment of rent for month)
Oct 3
Advertising expenses Dr. $525
Cash Cr. $525
(To record entry for Advertising expenses)
Oct 5
Supplies Dr. $1250
Cash Cr. $1250
(To record entry for purchase of supplies)
Oct 6
Office equipment Dr. $9300
Accounts Payable Cr. $9300
(To record purchase of office equipment on account)
Oct 10
Cash Dr. $16600
Accounts Receivable Cr. $16600
(To record cash received from customers on account)
Oct 15
Accounts payable Dr. $3720
Cash Cr. $3720
(To record payment made to creditors)
Oct 27
Miscellaneous expenses Dr. $590
Cash Cr. $590
(To record repair expense of office equipment)
Oct 30
Telephone expense Dr. $275
Cash Cr. $275
(To record payment made for telephone bill)
Oct 31
Accounts receivables Dr. $50160
Service fees Cr. $50160
(To record fees earned )
Oct 31
Utility expense Dr. $830
Cash CR $830
(To record payment made for electricity bill)
Oct 31
Personal use Dr. $1700
Cash Cr. $1700
(To record payment of dividend)
Which of the following is true of import tariffs and quotas? a. Because they increase the output levels of domestic firms, they tend to lower domestic prices. b. They benefit domestic producers. c. Specialization and comparative advantage are advanced by tariffs and quotas. d. Domestic consumers gain because they purchase the output of domestic firms. e. They tend to expand the volume of world trade.
Answer:
b. They benefit domestic producers.
Explanation:
The tariff and quotas would rise the goods value in the market price that permits the domestic consumer who was fire out also the production would be increased but at a higher cost so at the time it would harm the local consumer but it benefit the producer
Therefore the option b is correct
Presented below is the trial balance of Cullumber Corporation at December 31, 2020.
Debit Credit
Cash $ 201,010
Sales $ 8,104,270
Debt Investments (trading) (at cost, $145,000) 157,270
Cost of Goods Sold 4,800,000
Debt Investments (long-term) 303,010
Equity Investments (long-term) 281,010
Notes Payable (short-term) 94,270
Accounts Payable 459,270
Selling Expenses 2,004,270
Investment Revenue 65,700
Land 264,270
Buildings 1,044,010
Dividends Payable 140,010
Accrued Liabilities 100,270
Accounts Receivable 439,270
Accumulated Depreciation-Buildings 152,000
Allowance for Doubtful Accounts 29,270
Administrative Expenses 902,700
Interest Expense 213,700
Inventory 601,010
Gain 82,700
Notes Payable (long-term) 904,010
Equipment 604,270
Bonds Payable 1,004,010
Accumulated Depreciation-Equipment 60,000
Franchises 160,000
Common Stock ($5 par) 1,004,270
Treasury Stock 195,27
Patents 195,000
Retained Earnings 82,010
Paid-in Capital in Excess of Par 84,010
Totals $12,366,070 $12,366,070
Prepare a balance sheet at December 31, 2020, for Cullumber Corporation. (Ignore income taxes). (List Current Assets in order of liquidity. List Property, Plant and Equipment in order of Land, Building and Equipment. Enter account name only and do not provide the descriptive information provided in the question.)
Answer:
Total assets = Shareholders' Equity and Liabilities = $4,008,860
Explanation:
To prepare the balance sheet, the income statement is first prepared to determine the net income as follows:
Cullumber Corporation
Income Statement
For the Year ended December 31, 2020
Particulars $
Sales 8,104,270
Cost of Goods Sold (4,800,000)
Gross profit 3,304,270
Operating expenses
Selling Expenses (2,004,270)
Administrative Expenses (902,700)
Operating income 397,300
Other income (expenses)
Interest Expense (213,700)
Investment Revenue 65,700
Net income 249,300
The balance sheet can now be presented as follows:
Cullumber Corporation
Balance Sheet
As at December 31, 2020
Particulars $ $
Investments
Debt Investments (long-term) 303,010
Equity Investments (long-term) 281,010
Total investments 584,020
Intangible Assets
Franchises 160,000
Patents 195,000
Total intangible assets 355,000
Property, Plant and Equipment
Land 264,270
Buildings 1,044,010
Accumulated Depreciation-Buildings (152,000)
Equipment 604,270
Accumulated Depreciation-Equip. (60,000)
Net Property, Plant and Equipment 1,700,550
Current Assets
Cash 201,010
Debt Inv. (trading) (at cost, $145,000) 157,270
Accounts Receivable 439,270
Allowance for Doubtful Accounts (29,270)
Inventory 601,010
Total current assets 1,369,290
Total Assets 4,008,860
Shareholders' Equity
Common Stock ($5 par) 1,004,270
Treasury Stock (195,270)
Gain 82,700
Retained Earnings 82,010
Paid-in Capital in Excess of Par 84,010
Net income 249,300
Total Shareholders' Equity 1,307,020
Long-term Liabilities
Notes Payable (long-term) 904,010
Bonds Payable 1,004,010
Total Long-term Liabilities 1,908,020
Current Liabilities
Notes Payable (short-term) 94,270
Accounts Payable 459,270
Dividends Payable 140,010
Accrued Liabilities 100,270
Total current liabilities 793,820
Shareholders' Equity and Liabilities 4,008,860
Melissa is conducting a survey of our classmates because our teacher wants the class to learn more about hygiene habits Melissa House develop a list of 10 questions
On January 2, 2020, Riverbed Company sells production equipment to Fargo Inc. for $46,000. Riverbed includes a 2-year assurance warranty service with the sale of all its equipment. The customer receives and pays for the equipment on January 2, 2020. During 2020, Riverbed incurs costs related to warranties of $900. At December 31, 2020, Riverbed estimates that $690 of warranty costs will be incurred in the second year of the warranty.
Required:
a. Prepare the journal entry to record this transaction on January 2, 2020, and on December 31, 2020.
b. Repeat the requirements for (a), assuming that in addition to the assurance warranty.
Answer:
A. Jan 2,2020
Dr Cash $46,000
Cr Sales Revenue $46,000
During 2020
Dr Warranty expenses $900
Cr Cash $900
Dec 31,2020
Dr Warranty expense $690
Cr Accrued warranty liability $690
B. Jan 2,2020
Dr Cash $46,760
Cr Sales revenue $46,000
Cr Unearned warranty expense $760
During 2020
Dr Warranty expenses $900
Cr Cash $900
Dec 31,2020
Dr Warranty expense $690
Cr Accrued warranty liability $690
Explanation:
Preparation of the journal entry to record this transaction on January 2, 2020, and on December 31, 2020
Jan 2,2020
Dr Cash $46,000
Cr Sales Revenue $46,000
(Being to record sale of equipment)
During 2020
Dr Warranty expenses $900
Cr Cash $900
(Being to record warranty expense)
Dec 31,2020
Dr Warranty expense $690
Cr Accrued warranty liability $690
(Being to record warranty liability)
B. Preparation of the Journal entry to Repeat the requirements for (a)
Jan 2,2020
Dr Cash $46,760
($46,000+$760)
Cr Sales revenue $46,000
Cr Unearned warranty expense $760
(Being to record sale of equipment and extended warranty)
During 2020
Dr Warranty expenses $900
Cr Cash $900
(Being to record warranty expense)
Dec 31,2020
Dr Warranty expense $690
Cr Accrued warranty liability $690
(Being to record warranty liability)
An investor takes a long position in 3 futures contracts. The initial margin is $8,200 per contract and the maintenance margin is $6,000 per contract. At 1 p.m. today, the investor's total margin account balance is $15,490.64 and the investor receives a margin call. How much must the investor deposit into the margin account at 1 p.m. to keep the futures position open
Answer:
$3,036.45
Explanation:
Total Initial margin = Initial margin per contract * Number of contracts = $8,200 * 3 = $24,600
Total maintenance margin = maintenance per contract * Number of contracts = $6,000 * 3 = $18,000
Total margin account balance = $15,490.64
We observe Margin account balance < Maintenance margin
Margin call required = Initial margin - Total account balance
Deposit Amount = Total initial Margin - Total Margin Account balance = $24,600 - $15,490.64 = $9,109.36 or $9,109.36/3 = $3,036.45 per contract.
In the FASB ASC, Sections are standardized across all Subtopics. For example, Section 20 will be the Glossary section in every Subtopic. Match the Section number with the appropriate description of the Section below. (Note: Not all Section numbers have been included, and not all of the descriptions will be used.)
- 05 - 25 - 30 - 35 - 50 - 65
A. Scope and Scope Exceptions
B. Recognition
C. Subsequent Measurement
D. Initial Measurement
E. XBRL Elements
F. Disclosure
G. Transition and Open Effective Date Information
H. Overview and Background
I. Implementation Guidance and Illustrations
J. Measurement
Answer:
A. 25
B. 50
C.05
D. 25
E. 30
F. 65
G. 35
H. 05
I. 25
J. 05
Explanation:
FASB is Financial Accounting Standard Board which reviews the standards and monitors its implementation after their issuance. The main purpose of FASB is to improve the financial accounting standards. It is single source of authoritative generally accepted accounting practices.
Use the following information to answer the questions:
Assets Liabilities and Equity
Cash 14,000 Accounts payable 17,000
Marketable securities 4,000 Notes payable 8,000
Accounts receivable 10,000 Current liabilities 25,000
Inventory 39,000 Long-term debt 80,000
Current assets 67,000 Total liabilities 105,000
Machines 42,000 Paid-in capital 30,000
Real estate 60,000 Retained earnings 34,000
Net fixed assets 102,000 Equity 64,000
Total assets 169,000 Total liab. & equity 169,000
Sales 330,000
Operating expenses 297,000
Depreciation 25,000
EBIT 8,000
Interest 5,000
Taxable income 3,000
Taxes 990
Net income 2010
There are 8,200 shares outstanding, each currently trading for $5.65.
Required:
a. What are earnings per share?
b. What is the book value per share?
Answer:
a. Earnings per share = $0.25
b. The book value per share = $7.80
Explanation:
Balance Sheet
Assets Liabilities and Equity
Cash 14,000 Accounts payable 17,000
Marketable securities 4,000 Notes payable 8,000
Accounts receivable 10,000 Current liabilities 25,000
Inventory 39,000 Long-term debt 80,000
Current assets 67,000 Total liabilities 105,000
Machines 42,000 Paid-in capital 30,000
Real estate 60,000 Retained earnings 34,000
Net fixed assets 102,000 Equity 64,000
Total assets 169,000 Total liab. & equity 169,000
Income Statement
Sales 330,000
Operating expenses 297,000
Depreciation 25,000
EBIT 8,000
Interest 5,000
Taxable income 3,000
Taxes 990
Net income 2,010
Outstanding shares = 8,200
Market price of shares = $5.65
Earnings per share = 2,010/8,200 = $0.25
Book value per share = (Assets - Liabilities)Equity/8,200
= ($169,000 - 105,000)/8,200 = $7.80
b) The earnings per share is a financial measure of the how much is generated in net income for each share. The book value per share measures the equity value per share.
A company owns a 5-year old turret lathe that has a book value of $25,000. The present market value for the lathe is $16,000. The expected decline in market value is $2,000/year to a minimum market value of $4000. maintenance plus operating costs for the lathe equal $4,200/year. A new turret lathe can be purchased for $45,000 and will have an expected life of 8 years. The market value for the turret lathe is expected to equal $45,000(0.70)k at the end of year k. Annual maintenance and operating cost is expected to equal $1,600.
Based on a 12% before-tax MARR, should the old lathe be replaced now? Use an equivalent uniform annual cost comparison, a planning horizon of 7 years, and the cash flow approach.
Answer:
old lathe should not be replaced now
Explanation:
Using MARR of 12%
Price decline of 2000 per year ; salvage value = (present market value - does cline per year)
Present market value of old lathe = $16000
Opening market value at year end = (16000 * 1.12) = 17920
Add: Maintainace plus operating cost = $4200 / year
Salvage value = 16000 - 2000 = 14000
Annual cost : (Opening market value + operating cost - salvage value)
Annual cost :
Year 1 = (17920 + 4200 - 14000) = 8120
Year 2:
Opening market value at year end = (14000 * 1.12) = 15680
Salvage value = (14000 - 2000) = 12000
Annual cost :
Year 1 = (15680 + 4200 - 12000) = 7880
Year 3:
Opening market value at year end = (12000 * 1.12) = 13440
Salvage value = (12000 - 2000) = 10000
Annual cost :
Year 1 = (13440 + 4200 - 10000) = 7640
Year 4:
Opening market value at year end = (10000 * 1.12) = 11200
Salvage value = (10000 - 2000) = 8000
Annual cost :
Year 1 = (11200 + 4200 - 8000) = 7400
New machine :
Opening market value of year end = (45000 * 1.12) = 50,400
Add : Maintenance plus Operating expense = $1600
Salvage value = 45000 * 0.7 = 31500
Annual cost :
50400 + 1600 - 31500
= 20500
New machine has a far greater annual cost thb the old, hence the old machine should still be used for now.
Cullumber Co. began operations on January 2, 2020. It employs 15 people who work 8-hour days. Each employee earns 11 paid vacation days annually. Vacation days may be taken after January 10 of the year following the year in which they are earned. The average hourly wage rate was $18 in 2020 and $19.50 in 2021. The average vacation days used by each employee in 2021 was 10. Cullumber Co. accrues the cost of compensated absences at rates of pay in effect when earned
Prepare journal entries to record the transactions related to paid vacation days during 2020 and 2021.
Answer and Explanation:
The Journal entries are shown below:
On 2020,
Wages expense Dr. $23,760(15 × 8 hrs × 11 days × $18)
To vacation wages payable $23,760
(To record the wages expense)
On 2021
Wages expense Dr $1,800
Vacation wages payable $21,600 (15 × 8 hrs × 10 days × $18)
To Cash $23,400 (15 × 8 hrs × 10 days × $19.50)
(To record the cash paid)
Wages expense Dr.$25,740 (15 × 8 hrs × 11 days × $19.50)
To vacation wages payable $25,740
(To record the wages expense)
You are researching Time Manufacturing and have found the following accounting statement of cash flows for the most recent year. You also know that the company paid $98 million in current taxes and had an interest expense of $48 million. Calculate the cash flows from assets and the cash flows to creditors and shareholders using the accounting information in the statement of cash flows.
Answer:
a. Cash Flows from Assets is $29m
b. Cash flow from creditors is 91.90m
Explanation:
a. Cash Flow to creditors = Interest Paid - Net new borrowings + retirement of debt
CFC = $48m - (-139.90) + 0
CFC = $91.90 m
b. Cash flow from Assets = Operating Cash Flow - Net capital spending - Change in net working capital
Cash flow from Assets = $520 - $375 - $116
Cash Flow from Assets = $29m
Veneer Corporation has a competitive advantage in contract manufacturing of small electrical components and expects their competitive advantage to last two years through calendar 2021. The competitive advantage will allow it to increase sales by 20% annually for 2020 and 2021, and, after that, its sales will grow at the same rate as the increase in nominal GDP.
Prepare a proforma income statement, balance sheet, and firm free cash flow for Veneer for 2020 and 2021 (the planning period) using the following assumptions:
Sales are expected to grow by 20% annually.
Cost of goods sold and operating expenses are a constant percent of revenues, interest is 5% of Beginning of Year (BOY) long-term debt plus short-term debt, depreciation is 10% of BOY total fixed assets (gross, not net) and income taxes are 35% of income before tax.
The projected cash balances will change to balance the balance sheet, and the remaining current assets increase in proportion to sales.
Gross fixed assets increase 5% each year.
Accounts payable increases in proportion to sales.
Short-term debt remains the same each year of the planning period. Long-term debt is payable, beginning at the end of the year 2020 and continuing at the end of each year, in equal annual principal payments of $540.
Retained earnings increases by net income and decreases by dividends. The dividend payout ratio is 25%.
During 2021, capital stock with a par value of $1 per share will be sold for $1 per share or a total of $500. There are no other sales of capital stock.
Veneer's Balance Sheet and Income Statement for 2018 and 2019 is shown below:
Veneer Corporation
Balance Sheets
December 31, 2018 and 2019
Historical
ASSETS 2018 2019
Current Assets:
Cash 368 1,823
Accounts receivable 1,622 1,599
Inventories 544 590
Total Current Assets 2,534 4,012
Fixed Assets
Total Fixed Assets (Gross) 7,800 8,474
Accumulated depreciation (580) (730)
Net Fixed Assets 7,220 7,744
TOTAL 9,754 11,756
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable 370 512
5% Short-term debt 1,800 2,288
Total Current Liabilities 2,170 2,800
5% Long-term debt 5,070 5,392
Shareholders' Equity:
Common stock 1,000 1,000
Additional paid-in capital 2,000 2,000
Retained earnings (250) 797
Total 2,750 3,797
Treasury stock (233) (233)
Total Shareholders' Equity 2,517 3,564
TOTAL 9,757 11,756
Statements of Income
Historical
2018 2019
Revenues 16,389 18,210
Cost of goods sold 10,832 12,035
Gross profit on sales 5,558 6,175
Operating expenses 3,521 3,912
Depreciation 150 150
EBIT 1,887 2,113
Interest expense 603 502
Income Taxes 449 564
Net Income 834 1,047
Answer:
Assets 2018 2019 2020 2021
Current Assets:
Cash 368 1,823 1,721 2,270
Account Receivavle 1,622 1,599 1,919 2,303
Inventories 544 590 708 850
Current Assets 2,534 4,012 4,348 5,422
Fixed Assets
Fixed Assets 7,800 8,474 8,898 9,343
Accumulated depreciation -580 -730 -847 -890
Net Fixed Assets 7,220 7,744 8,050 8,453
Total 9,754 11,756 12,398 13,875
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Account Payable 370 512 614 737
Short term debt 1,800 2,288 2,288 2,288
Total Current liabilities 2,170 2,800 2,902 3,025
Long Term Debt 5,070 5,392 4,852 4,312
Shareholders' Equity:
Common Stock 1,000 1,000 1,000 1,500
Additional paid in capital 2,000 2,000 2,000 2,000
Retained earnings -250 797 1,876 3,270
Total 2,750 3,797 4,876 6,770
Treasury stock -233 -233 -233 -233
Total Shareholders' Equity: 2,517 3,564 4,643 6,537
Total 9,757 11,756 12,398 13,875
-3 0 0 0
Statements of Income
2018 2019 2020 2021
Revenues 16,389 18,210 21,852 26,222
Cost of goods sold 10,832 12,035 14,442 17,330
Gross profit on sales 5,558 6,175 7,410 8,892
Operating expenses 3,521 3,912 4,694 5,633
Depreciation 150 150 117 42
EBIT 1,887 2,113 2,598 3,216
Interest expense 603 502 384 357
Income Taxes 449 564 775 1,001
Net Income 835 1,047 1,439 1,859
Explanation:
Assets 2018 2019 2020 2021
Current Assets:
Cash 368 1,823 1,721 2,270
Account Receivavle 1,622 1,599 1,919 2,303
Inventories 544 590 708 850
Current Assets 2,534 4,012 4,348 5,422
Fixed Assets
Fixed Assets 7,800 8,474 8,898 9,343
Accumulated depreciation -580 -730 -847 -890
Net Fixed Assets 7,220 7,744 8,050 8,453
Total 9,754 11,756 12,398 13,875
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Account Payable 370 512 614 737
Short term debt 1,800 2,288 2,288 2,288
Total Current liabilities 2,170 2,800 2,902 3,025
Long Term Debt 5,070 5,392 4,852 4,312
Shareholders' Equity:
Common Stock 1,000 1,000 1,000 1,500
Additional paid in capital 2,000 2,000 2,000 2,000
Retained earnings -250 797 1,876 3,270
Total 2,750 3,797 4,876 6,770
Treasury stock -233 -233 -233 -233
Total Shareholders' Equity: 2,517 3,564 4,643 6,537
Total 9,757 11,756 12,398 13,875
-3 0 0 0
Statements of Income
2018 2019 2020 2021
Revenues 16,389 18,210 21,852 26,222
Cost of goods sold 10,832 12,035 14,442 17,330
Gross profit on sales 5,558 6,175 7,410 8,892
Operating expenses 3,521 3,912 4,694 5,633
Depreciation 150 150 117 42
EBIT 1,887 2,113 2,598 3,216
Interest expense 603 502 384 357
Income Taxes 449 564 775 1,001
Net Income 835 1,047 1,439 1,859
5. It is April 19, 2012 and you suddenly remember that your credit card bill
is due the next day. You have the money in your checking account to pay
the bill in full. The mailing address for the credit card company is a few
thousand miles away so you assume that it will take a few days for your
check to arrive. What should you do?
Answer: Take a picture of the check and email it to the company's address.
Based on the information, what should you do is Access your credit card account online to see if they have online options available that will get the payment to them by April 20th. Thus the correct option is B.
What is a credit card?A credit card is said to be a type of plastic money that allows an individual to purchase goods on credit and pay back the amount later on some specified rate of interest being charged on it.
In order to avoid excessive spending, one should keep in mind that if a credit card debt is left unpaid at the end of the credit limit, interest will be imposed on the remaining balance.
Paying late fees results in unneeded costs, thus it's wiser to Check your credit card account online to see if there are any online solutions that will allow you to send the payment by April 20th without incurring any additional payment fees.
Therefore, option B is appropriate.
Learn more about credit cards, here:
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The complete question is Probably
It is April 19, 2012 and you suddenly remember that your credit card bill is due the next day. You have the money in your checking account to pay the bill in full. The mailing address for the credit card company is a few thousand miles away so you assume that it will take a few days for your check to arrive. What should you do?
answer choices
Take the letter to the post office to get it postmarked on or before April 20th since that will be fine with the credit card company.
Access your credit card account online to see if they have online options available that will get the payment to them by April 20th.
Send the check to your credit card company through your bank’s bill pay service which guarantees 48 hour delivery.
Call the credit card company to tell them you will be late with your payment.
Total and unit cost, decision making. Gayle’s Glassworks makes glass flanges for scientific use. Materials cost $1 per flange, and the glass blowers are paid a wage rate of $28 per hour. A glass blower blows 10 flanges per hour. Fixed manufacturing costs for flanges are $28,000 per period. Period (nonmanufacturing) costs associated with flanges are $10,000 per period and are fixed.
1. Graph the fixed, variable, and total manufacturing cost for flanges, using units (number of flanges) on the x-axis.2. Assume Gayle’s Glassworks manufactures and sells 5,000 flanges this period. Its competitor, Flora’s Flasks, sells flanges for $10 each. Can Gayle sell below Flora’s price and still make a profit on the flanges?3. How would your answer to requirement 2 differ if Gayle’s Glassworks made and sold 10,000 flanges this period? Why? What does this indicate about the use of unit cost in decision making?
Answer:
1. this is a graph. i have added it as an attachment
2. gayles glass work cannot sell below floras flask and still make profit.
3. here gayles glasswork can sell below floras flask and still make profit. unit cost helps in decision making concerning selling price and profit
Explanation:
1. please check the attachment for the graph. we have number of flanges on the x axis of the graph and costs of manufacturing on the y axis.
2. 10 flanges at $1 + $28/hr
= $38
the variable cost for manufacturing per unit of flange = 38/10 = $3.8
[tex]total cost per flange = (3.8 +\frac{28000}{5000} )+\frac{10000}{5000}[/tex]
= $11.40
so if Gayle's should manufacture and sell 5000 flanges, it would have total cost per flange as 11.40 dollars. while floras flask has 10 dollars per flask. Gayle's glasswork should not sell below 10 dollars as it would not be able to make profit.
3. If gayles glasswork sold and made 10000 flanges this period
[tex]total cost per flange=[3.80+\frac{28000}{10000} ]+\frac{10000}{10000}[/tex]
= $7.60
the selling price of flora flask is = 10 dollars with Gayle's = 7.60 dollars. Gayle's can make profit by keeping selling price less than flora flask. therefore Gayle can make profit by selling below flora flask.
What does this indicate about the use of unit cost in decision making?
we saw how unit cost fell fro 11.40 dollars to 7.6 dollars as fixed and period costs remained unchanged, not withstanding the number of units that was being manufactured. this shows that unit cost plays a great role in decision making concerning selling price, profit as well as feasibility of the product.
thank you!
Item4 eBookPrintReferencesCheck my workCheck My Work button is now disabledItem 4 Lanson Corporation Co.'s trial balance included the following account balances at December 31, 2021: Accounts payable $25,200 Bonds payable, due 2030 24,600 Salaries payable 16,400 Notes payable, due 2022 21,100 Notes payable, due 2026 40,300 What amount should be included in the current liabilities section of Lanson's December 31, 2021, balance sheet
Answer:
$41,600
Explanation:
Calculation for What amount should be included in the current liabilities section of Lanson's December 31, 2021, balance sheet
Accounts payable $25,200
Add Salaries payable $16,400
December 31, 2021, balance sheet current liabilities $41,600
($25,200+$16,400)
Therefore the amount that should be included in the current liabilities section of Lanson's December 31, 2021, balance sheet will be $41,600
Orange, Inc. has identified the following cost drivers for its expected overhead costs for the year:
Overhead Item Expected Cost Cost Driver Expected Quantity
Setup costs $50,000 Number of setups 250
Ordering costs 30,000 Number of orders 1,500
Maintenance 100,000 Machine hours 2,000
Power 20,000 Kilowatt hours 4,000
Total Overhead $200,000
Total direct labor hours budgeted = 2,000 hours.
The following actual data applies to one of the products completed during the year:
Direct materials $5,000 Number of setups 5
Direct labor $3,000 Number of orders 50
Units completed 100 Machine hours 50
Direct labor hours 100 Kilowatt hours 500
If Orange, Inc. uses direct labor hours to assign overhead, the unit product cost for Product X will be:
a. $70.00.
b. $60.00.
c. $180.00.
d. $90.00.
e. $80.00
Answer:
Unit product cost is $130
Explanation:
The computation of the unit product cost for product X is given below;
Direct material per unit (5,000 ÷ 100) $50
Direct labor per unit (3,000 ÷ 100) $30
Manufacturing overhead ($200,000 ÷ 2,000) × 50 ÷ 100 $50
Unit product cost is $130
This is the correct answer but the same is not provided in the given options
