Answer:
A. Dr Petty Cash $550
Cr Cash $550
B..Dr Store Supplies $211
Dr Miscellaneous Selling Expense $133
Dr Cash Short and Over $16
Cr Cash $360
Explanation:
A. Preparation of the Joural entry if Issued a check to establish a petty cash fund of $550
Dr Petty Cash $550
Cr Cash $550
(To record creation of petty cash)
(b)
Dr Store Supplies $211
Dr Miscellaneous Selling Expense $133
Dr Cash Short and Over $16
($550-$211-$133-$190)
Cr Cash $360
($211+$133+$16)
(To record expense and replenish the petty cash)
A furniture manufacturer uses a standard costing system in which standard machine-hours (MHs) is the measure of activity. Data from the company's flexible budget for manufacturing overhead are given below: Denominator level of activity 2,400 MHs Overhead costs at the denominator activity level: Variable overhead cost $ 25,430 Fixed overhead cost $ 27,370 The following data pertain to operations for the most recent period: Actual hours 2,300 MHs Standard hours allowed for the actual output 2,440 MHs Actual total variable manufacturing overhead cost $ 21,440 Actual total fixed manufacturing overhead cost $ 28,560 The predetermined overhead rate is closest to:
Answer:
Predetermined manufacturing overhead rate= $22 per machine hour
Explanation:
Giving the following formula:
Denominator level of activity 2,400 MHs
Variable overhead cost $ 25,430
Fixed overhead cost $ 27,370
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= (25,430 + 27,370) / 2,400
Predetermined manufacturing overhead rate= $22 per machine hour
On January 1, 2019, the board of directors was considering the distribution of a $63,500 cash dividend. No dividends were paid during 2017 and 2018. Required: Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under two independent assumptions: The preferred stock is noncumulative. The preferred stock is cumulative. Why were the dividends per share of common stock less for the cumulative preferred stock than the noncumulative preferred stock
Answer:
1-a. We have:
Total amount to be paid as dividend to preferred stockholders = $9,312.40
Amount to be paid as dividend per share to preferred stockholders = $1.24 per share
Total amount to be paid as dividend to common stockholders = $54,287.60
Amount to be paid as dividend per share to common stockholders = $1.13 per share
1-b. We have:
Total amount to be paid as dividend to preferred stockholders = $27,937.20
Amount to be paid as dividend per share to preferred stockholders = $3.72 per share
Total amount to be paid as dividend to common stockholders = $35,662.80
Amount to be paid as dividend per share to common stockholders = $0.74 per share
2. The reason is that the unpaid dividends in 2017 and 2018 were carried forward and paid together with 2019 dividend to cumulative preferred stockholders, but this cannot be done when the preferred stock is noncumulative.
3. Some the factors include making preferred stock noncumulative, declaration of a higher cash dividend, redemption of redeemable preference shares so that only common stockholders receive dividends, and among others.
Explanation:
Note: This question is not complete and there is an error in the amount of the dividend being considered. The complete question is therefore presented with the correct dividend amount before answering the question as follows:
The records of Hoffman Company reflected the following balances in the stockholders' equity accounts at December 31, 2018:
Common stock, par $12 per share, 48,000 shares outstanding.
Preferred stock, 8 percent, par $15.5 per share, 7,510 shares outstanding.
Retained earnings, $236,000.
On January 1, 2019, the board of directors was considering the distribution of a $63,600 cash dividend. No dividends were paid during 2017 and 2018.
Required:
1. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under two independent assumptions:
a. The preferred stock is noncumulative.
b. The preferred stock is cumulative.
2. Why were the dividends per share of common stock less for the cumulative preferred stock than the noncumulative preferred stock?
3. What factors would cause a more favorable dividend for the common stockholders?
The explanation of the answrs is now given as follows:
1-a. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under the assumption that the preferred stock is noncumulative.
Total amount to be paid as dividend to preferred stockholders = Annual preferred stock dividend = 8% * $15.5 * 7,510 = $9,312.40
Amount to be paid as dividend per share to preferred stockholders = Total amount to be paid as dividend to preferred stockholders / Number of Preferred shares outstanding = $9,312.40 / 7,510 = $1.24 per share
Total amount to be paid as dividend to common stockholders = Amount of cash dividend being considered - Total amount to be paid as dividend to preferred stockholders = $63,600 - $9,312.40 = $54,287.60
Amount to be paid as dividend per share to common stockholders = Total amount to be paid as dividend to common stockholders / Number of common shares outstanding = $54,287.60 / 48,000 = $1.13 per share
1-b. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under the assumption that the preferred stock is cumulative.
Annual preferred stock dividend = 8% * $15.5 * 7,510 = $9,312.40
Total amount to be paid as dividend to preferred stockholders = Annual preferred stock dividend for 3 years for 2017, 2018 and 2019 = $9,312.40 * 3 = $27,937.20
Amount to be paid as dividend per share to preferred stockholders = Total amount to be paid as dividend to preferred stockholders / Number of Preferred shares outstanding = $27,937.20 / 7,510 = $3.72 per share
Total amount to be paid as dividend to common stockholders = Amount of cash dividend being considered - Total amount to be paid as dividend to preferred stockholders = $63,600 - $27,937.20 = $35,662.80
Amount to be paid as dividend per share to common stockholders = Total amount to be paid as dividend to common stockholders / Number of common shares outstanding = $35,662.80 / 48,000 = $0.74 per share
2. Why were the dividends per share of common stock less for the cumulative preferred stock than the noncumulative preferred stock?
The reason is that the unpaid dividends in 2017 and 2018 were carried forward and paid together with 2019 dividend to cumulative preferred stockholders, but this cannot be done when the preferred stock is noncumulative.
3. What factors would cause a more favorable dividend for the common stockholders?
Some the factors include making preferred stock noncumulative, declaration of a higher cash dividend, redemption of redeemable preference shares so that only common stockholders receive dividends, and among others
For a particular flight from Dulles to SF, an airline uses wide-body jets with a capacity of 370 passengers. It costs the airline $4,000 plus $145 per passenger to operate each flight. Through experience the airline has discovered that if a ticket price is $T, then they can expect (370−0.56T) passengers to book the flight. Determine the ticket price, T, that will maximize the airline's profit
Answer:
The ticket price, T, that will maximize the airline's profit is $402.86.
Explanation:
This can be determined as follows:
Number of passenger = (370−0.56T)
Cost = 4000 + (145 * Number of passenger) = 4000 + 145(370−0.56T) = 4000 + 53,650.00 - 81.20T = 57650 – 81.20T
Revenue = T * Number of passenger = T(370 – 0.56T) = 370T – 0.56T^2
P = Profit = Revenue – Cost = 57650 – 81.20T – (370T – 0.56T^2) = 57650 – 81.20T – 370T + 0.56T^2 = 57650 - 451.20T + 0.56T^2 ……………….. (1)
Differentiating equation (1) with rest to T, equate to 0 and solve for T, we have:
P’ = –451.20 + 1.12T = 0
1.12T = 451.20
T = 451.20 / 1.12
T = 402.86
Therefore, the ticket price, T, that will maximize the airline's profit is $402.86.
6. What are complements? evonomics
Answer:
The answer is below
Explanation
Complements in economics is a term that is used to describe goods that are used or consumed together. For example, pencil and eraser, pen and paper, etc.
Complements are goods in economics whose value is increased when combined with other goods. Another example of complement goods is movies and popcorn
Wahoo Inc., a calendar year taxpayer, leases equipment to a customer for $4,500 monthly rent. On November 27, 2020, Wahoo received a $36,000 rent payment for the eight-month period beginning on December 1. Required: How much of the payment must Wahoo recognize as 2020 taxable income assuming that Wahoo uses the cash method of accounting for tax purposes
Answer:
A. Cash method of accounting $36,000
B. Accrual method of accounting $36,000
Explanation:
A Based on the information given we were told that the Wahoo have to recognize the whole prepayment amount of $36,000 as 2019 income which means that UNDER CASH METHOD OF ACCOUNTING How much of the payment must Wahoo recognize as 2020 taxable income is the whole prepayment amount of $36,000.
B.Based on the information given we were told that the Wahoo have to recognize the whole prepayment amount of $36,000 as 2019 income which means that UNDER ACCRUAL METHOD OF ACCOUNTING How much of the payment must Wahoo recognize as 2020 taxable income is the same whole prepayment amount of $36,000.
what is market management
Answer:
Marketing management is the organizational discipline which focuses on the practical application of marketing orientation, techniques and methods inside enterprises and organizations and on the management of a firm's marketing resources and activities.
Answer:
Marketing management is the organizational discipline which focuses on the practical application of marketing orientation, techniques and methods inside enterprises and organizations and on the management of a firm's marketing resources and activities.
Jack went to a farm and purchased a fox, a chicken, and an avocado. On his way home, Jack came to the bank of a river and rented a boat. But crossing the river by boat, Jack could carry only himself and a single one of his purchases: the fox, the chicken, or the avocado. If left unattended together, the fox would eat the chicken, or the chicken would eat the avocado. Jack's challenge was to carry himself and his purchases to the far bank of the river, leaving each purchase intact. How did he do it
Answer:
The answer is explained step by step below
Explanation:
In order to solve this dilemma, Jack would first take the chicken across the river, leaving the fox and the avocado behind. This is because if the chicken was left out then it would either be eaten by the fox or it would eat the avocado.
Then next Jack would go back and get the fox. This time when he reaches the other side of the river along with the fox, he would take the chicken back with him to the starting side. If he left the fox along with the chicken then it would have eaten it.
Then when he drops the chicken at the starting side and he would take the avocado with him to the other side of the river.
Finally, he would go back and get the chicken. Thus, bringing all the three items to the across side of the river without losing either of them.
Exercise 9-5 Writing off receivables LO P2 On January 1, Wei Company begins the accounting period with a $30,000 credit balance in Allowance for Doubtful Accounts. On February 1, the company determined that $6,800 in customer accounts was uncollectible; specifically, $900 for Oakley Co. and $5,900 for Brookes Co. Prepare the journal entry to write off those two accounts. On June 5, the company unexpectedly received a $900 payment on a customer account, Oakley Company, that had previously been written off in part a. Prepare the entries to reinstate the account and record the cash received.
Answer:
Wei Company
1. Journal Entries:
February 1:
Debit Allowance for Doubtful Accounts $6,800
Credit Accounts Receivable $6,800
To write-off the uncollectibles accounts of Oakley Co., $900 and Brookes Co., $5,900.
June 5:
Debit Accounts Receivable (Oakley Co.) $900
Credit Allowance for Doubtful Accounts $900
To reinstate the accounts of Oakley Co.
Debit Cash $900
Credit Accounts Receivable (Oakley Co.) $900
To record the receipt of cash from Oakley Co.
Explanation:
a) Data and Analysis:
January 1: Beginning balance of Allowance for Doubtful Accounts $30,000 credit
February 1: Allowance for Doubtful Accounts $6,800 Accounts Receivable $6,800 (Oakley Co., $900 and Brookes Co., $5,900)
June 5: Accounts Receivable (Oakley Co.) $900 Allowance for Doubtful Accounts $900
June 5: Cash $900 Accounts Receivable (Oakley Co.) $900
Identify which are goals of monetary policy, and which are not. Goals of monetary policy Not goals of monetary policy Answer Bank financial market stability increasing the size of the financial sector economic growth high inflation improving banks' profits high employment price stability Which two goals are often called the dual mandate of the Federal Reserve
Answer:
goals of monetary policy
financial market stability
economic growth
high employment
price stability
Not goals of monetary policy
increasing the size of the financial market
high inflation
improving banks' profits
Dual mandate : high employment
price stability
Explanation:
Monetary policy are policies taken by the central bank of a country to increase or reduce aggregate demand.
There are two types of monetary policy :
Expansionary monetary policy : these are polices taken in order to increase money supply. When money supply increases, aggregate demand increases. reducing interest rate and open market purchase are ways of carrying out expansionary monetary policy
Contractionary monetary policy : these are policies taken to reduce money supply. When money supply decreases, aggregate demand falls. Increasing interest rate and open market sales are ways of carrying out contractionary monetary policy
Goals of monetary policy include
financial market stability economic growth high employment price stabilityThe dual mandate of the Federal Reserve was birthed as a result of the stagflation of the 1970s. Stagflation is a period of high unemployment and high inflation levels
The dual mandate are : high employment, stable prices and moderate long-term interest rates.
Assume that two individuals agree to form a partnership. Partner A is contributing an operating business that reports the following balance sheet: Cash $14,000 Accounts payable $42,000 Receivables 28,000 Accrued liabilities $28,000 Inventories 56,000 Total liabilities $70,000 Total assets $98,000 Net assets $28,000 Partner B is contributing cash of $77,000. The partners agree that the initial capital of the partnership should be shared equally. Prepare the journal entry to record the capital contributions of the partners using both the Bonus Method and the Goodwill Method.
Answer:
Explanation:
By using the Bonus method for the initial investment:
The overall total capital contributed that can be identified as:
= $28,000 + $77,000
= $105,000
If the unidentifiable assets are not registered, each partner will begin with:
=[tex]\dfrac{ \$ 105,000}{2}[/tex]
= $52,500
Journal Entry: For Bonus Method
Description Debit Credit
Cash 91,000
Receivables 28,000
Inventories 56,000
Accounts Payable 42,000
Accrued Liabilities 28,000
Capital for Partner A, 52,500
Capital for Partner B, 52,500
[The business began with a small initial investment]
Using the Goodwill method for the initial investment:
The value of A's unrecognizable assets is calculated using B's allocation (50 percent)
Total partnership capital [tex]=(\$77000 \times \dfrac{100}{50}) - ( 28000 + 77000)[/tex]
= $49,000
Thus, Goodwill = $49,000
Journal Entry : For Goodwill Method
Description Debit Credit
Cash 91,000
Receivables 28,000
Inventories 56,000
Goodwill 49,000
Accounts Payable 42,000
Accrued Liabilities 28,000
Capital for Partner A, 77,000
Capital for Partner A, 77,000
[The business began with a small initial investment]
when input costs increase
there is a movement up along an existing supply curve
the supply curve shifts to the right
the supply curve shifts to the left
there is a movement down along an existing supply curve
Answer:
there is a movement up along an existing supply curve
Explanation:
Hope it helps u
FOLLOW MY ACCOUNT PLS PLS
the sale of a computer at net book value had been credited in error to the Sales account 230 how do we record on the journal
Answer:
koneksyon
Explanation:
dahil Dito makikita kung gani ka katipid
The Computer Division would like to purchase 17,000 units each period from the Keyboard Division. The Keyboard Division has ample excess capacity to handle all of the Computer Division's needs. The Computer Division now purchases from an outside supplier at a price of $37. If the Keyboard Division refuses to accept an $35 price internally, the company, as a whole, will be worse off by:
Answer:
$136,000
Explanation:
Calculation to determine how much will the company, as a whole, will be worse off by
Using this formula
Worse off amount =(Purchases from an outside supplier -Variable cost per unit)*Units purchased
Let plug in the formula
Worse off amount =($37-$29)*17,000
Worse off amount =$8*17,000
Worse off amount =$136,000
Therefore the company, as a whole, will be worse off by $136,000
If the market price is P1: Group of answer choices the firm will break even by producing a quantity of Q2. the firm may make a profit if it can increase the demand for its product. the firm will experience a loss and raise its price to P2. The firm will then break even. the firm will experience a loss since price is less than ATC.
Answer:
the firm will experience a loss since price is less than ATC.
Explanation:
In the case of the perfectly competitive firm when the market price is P_1 so the curve i.e. shown in the attachment represent that the firm would have a loss as the price would be lower than the average total cost i.e. ATC
So according to the given situation, the last option is correct
And the rest of the options would be wrong
Determine the original investment for the following related subsequent cash flows if the internal rate of return (IRR) is 12%.
A :
$17,438.62
B :
$19,975.40
C :
$22,767.86
D :
$21,875.00
Answer:
B : $19,975.40
Explanation:
The computation of the original investment is shown below:
Year Cash flows Discount rate at 12% Present value
1 $10,000 0.8926 $8,928.57
2 $8,500 0.79719 $6,776.15
3 $6,000 0.71178 $4,270.68
Total present value $19,975.40
In the case of IRR, the total of present value would be equivalent to the orginal investment
Consider a 30-year 8 percent bond, paying coupon semi-annually, and selling for $896.81 today (note that the yield is 9 percent). Find the holding period return if the interest rate drops to 8 percent after six months. Make sure to annualize the rate. Make sure to show your work.
Answer: See explanation
Explanation:
Based on the information given, we should note that the bond will trade at par at $1000 after six month
The holding period return will be:
= [ P1 - P0] / P0
= [ 1000 - 896.81 ] / 896.81
= 103.19 / 896.81
= 0.1151
= 11.51%
Then, the Annualized rate will be:
= HPR at 6 Months / 6/12
= HPR × 12 / 6
= 11.51% × 12 / 6
= 11.51% × 2
= 23.01%
Annualized Rate = 23.01%
Sam and Joan made an offer of $250,000 asking the seller to pay all closing costs. They will put 10% down and pay one discount points at closing. The amount of cash required at closing for Sam and Joan will be?
Answer:
$27,500
Explanation:
Discount points are also called mortgage points and are fees paid as prepaid interest rate on a mortgage property.
One discount point is equivalent to 1% of the loan amount.
In the given scenario a down payment of 10% was made.
Also they are pay one discount point to close.
So total down payment to be made is 10% + 1% = 11%
Amount is cash for closing = 0.11 * 250,000 = $27,500
Consider each situation for Kathy, Inc. below independently.
Kathy, Inc. issued 10,000 shares of its $25 par common stock (current fair value of common is $35 per share) for a large tract of land. The land was appraised at $400,000.
Kathy already had 500,000 shares of common stock outstanding.
Kathy, Inc. issued 2,000 shares of $10 par Class A common stock at $12 and 100 shares of no-par Class B common stock at $20.
Required:
a. At what amount should land be recorded?
b. What is the total amount that should be recorded for additional paid-in capital from the second situation?
Answer:
Kathy, inc.
a. The land should be recorded initially at $250,000. This is what it caused the company to acquire it in exchange for common stock.
b. The total amount that should be recorded for additional paid-in capital from the second situation is:
= $4,000.
Explanation:
Data and Calculations
a. Common stock issued for land = 10,000
Par value of common stock = $25
Market value of common stock = $35
Appraised value of land = $400,000
Value of land = $250,000 ($25 * 10,000)
b. Outstanding common stock = 500,000 shares
New issue of 2,000 $10 par Class A common stock at $12 = $24,000
New issue of 100 shares of no-par Class B common stock at $20 = $2,000
Total amount received = $26,000
Common stock value:
2,000 at $10 = $20,000
Additional paid-in capital = $4,000 ($24,000 - $20,000)
Exercise 14-08 a-b (Video) (Part Level Submission) Cheyenne Corp. incurred the following costs while manufacturing its product. Materials used in product $129,100 Advertising expense $53,200 Depreciation on plant 64,600 Property taxes on plant 16,000 Property taxes on store 8,160 Delivery expense 24,300 Labor costs of assembly-line workers 111,300 Sales commissions 40,100 Factory supplies used 28,700 Salaries paid to sales clerks 57,100 Work in process inventory was $14,500 at January 1 and $16,800 at December 31. Finished goods inventory was $69,500 at January 1 and $46,000 at December 31. Collapse question part (a) Compute cost of goods manufactured. Cost of goods manufactured
Answer:
(a) Cost of goods manufactured = $347,400
(b) Cost of goods sold = $370,900
Explanation:
Note: The requirement of this question is not complete. The complete requirement is therefore provided before answering the question as follows:
(a) Compute cost of goods manufactured.
(b) Compute cost of goods sold.
(a) Compute cost of goods manufactured.
This can be computed as follows:
Cost of goods manufactured = Direct materials used + Labor costs of assembly-line workers + Depreciation on plant + Factory supplies used + Property taxes on plant + Work in Process at January 1 - Work-in-process at December 31 = $129,100 + $111,300 + $64,600 + $28,700 + $16,000 + $14,500 - $16,800 = $347,400
(b) Compute cost of goods sold.
This can be computed as follows:
Cost of goods sold = Finished goods inventory at January 1 + Cost of goods manufactured - Finished goods inventory at December 31 = $69,500 + $347,400 - $46,000 = $370,900
Allen deposits $2,000 in his local bank. He earns 2 percent interest each year on his deposit. Jessica borrows $1,000 from the same bank. She is charged a 7 percent interest rate on the borrowed money. How do these bank practices affect the money supply in the community?
A. In Allen's case, but not Jessica's, the money supply decreases.
B. In both Allen's and Jessica's cases, the money supply decreases.
C. In Jessica's case, but not Allen's, the money supply stays the same.
D. In neither Jessica's nor Allen's case does the money supply increase.
Answer:
A is the correct answer,
Explanation:
I got it right on the test
The Human Services career path is where "public servants" of the world work.
True
False
Answer:
false
Explanation:
what problems seem to emerge when an organization gets larger
Answer:
Difficulties with sharing due to the overpopulation
Explanation:
What is the fifth principle of money?
O Tell the truth
O Focus on what you have
O Money has no life or power of its own.
O Do what is best for you and your money
Answer:
focus on what you have
Explanation:
i hope this will help
Garvey Company (the lessee) entered into an equipment lease with Richie Company (the lessor) on January 1 of Year 1. 1. The equipment reverts back to the lessor at the end of the lease, and there is no bargain purchase option. The equipment is not specialized for Garvey. 2. The lease term is 5 years and requires Garvey to make annual payments of $65,949.37 at the end of each year. 3. The discount rate is 10%, which is implicit in the lease. Garvey knows this rate. 4. The fair value of the equipment at the lease inception is $250,000. The present value of an ordinary annuity of five payments of $65,949.37 each at 10% is $250,000. 5. The equipment has an estimated economic life of 7 years and has zero residual value at the end of this time. Straight-line depreciation is used for similar assets. Required: Prepare the journal entries that Richie Company (the lessor) would make in the first year of the lease assuming the lease is classified as a sales-type lease. Assume that the lessee is required to make payments on December 31 each year. Also assume that Richie had purchased the equipment at a cost of $200,000.
Answer:
Jan.1
Dr Lease Receivable $250,000
Cr Sales Revenue $250,000
Jan. 1
Dr Cost of Goods Sold $200,000
Cr Equipment Leased to Others $200,000
Dec. 31
Dr Cash $65,949.37
Cr Lease Receivable $40,949.37
Cr Interest Income $25,000
Explanation:
Preparation of the journal entries that Richie Company (the lessor) would make in the first year of the lease
Jan.1
Dr Lease Receivable $250,000
Cr Sales Revenue $250,000
Jan. 1
Dr Cost of Goods Sold $200,000
Cr Equipment Leased to Others $200,000
Dec. 31
Dr Cash $65,949.37
Cr Lease Receivable $40,949.37
Cr Interest Income $25,000
($250,000*10%)
Alpha began operations in 2015. It reported $500 in revenues. It reported $200 depreciation expense on its 2015 tax return; however, it reported $50 depreciation expense on its 2015 income statement. The difference in depreciation (Alpha's only book-tax difference) is a temporary book-tax difference that will reverse over time. Assuming a constant tax rate of 30%. What will be the balance in the DTL account in Alpha's 2015 balance sheet?
Answer:
$45
Explanation:
Calculation to determine What will be the balance in the DTL account in Alpha's 2015 balance sheet
Using this formula
Deferral Tax Liabiltiy balance =(2015 Reported depreciation expense on tax return-2015 Reported depreciation expense on income statement)*Tax rate
Let plug in the formula
Deferral Tax Liabiltiy balance=($200-$50)*30%
Deferral Tax Liabiltiy balance=$150*30%
Deferral Tax Liabiltiy balance=$45
Therefore What will be the balance in the DTL account in Alpha's 2015 balance sheet is $45
During its first year of operations, Eastern Data Links Corporation entered into the following transactions relating to shareholders’ equity. The articles of incorporation authorized the issue of 8 million common shares, $1 par per share, and 1 million preferred shares, $50 par per share.
Required:
Prepare the appropriate journal entries to record each transaction.
Feb. 12 Sold 2 million common shares, for $9 per share.
Feb 13 Issued 40,000 common shares to attorneys in exchange for legal services.
Feb 13 Sold 80,000 of its common shares and 4,000 preferred shares for a total of $ 945,000
Nov. 15 Issued 380,000 of its common shares in exchange for equipment for which the cash price was known to be $3,688,000.
Answer:
Date Account Title Debit Credit
Feb 12 Cash $18,000,000
Common Stock $2,000,000
Paid in Capital in excess of Com- $16,000,000
mon stock par value
Working
Cash = 2 million shares * $9 = $18,000,000
Common stock = 2 million * $1 par value = $2,000,000
Date Account Title Debit Credit
Feb 13 Legal expenses $360,000
Common Stock $40,000
Paid in Capital in excess of Com- $320,000
mon stock par value
Working
Cash = 40,000 shares * 9 = $360,000
Common Stock = 40,000 * 1 = $40,000
Date Account Title Debit Credit
Feb 13 Cash $945,000
Common stock $80,000
Preferred Stock $200,000
Paid in Capital in excess of Com- $640,000
mon stock par value
Paid in Capital in excess of Pre- $25,000
ferred stock par value
Working:
Common stock = 80,000 shares * 1 = $8,000
Preferred stock = 4,000 shares * $50 = $200,000
Paid in Cap, Common = 80,000 * (9 - 1) = $640,000
Date Account Title Debit Credit
Nov. 15 Equipment $3,688,000
Common Stock $380,000
Paid in Capital in excess of Com- $3,308,000
mon stock par value
Working:
Common stock = 380,000 * $1 = $380,000
Assume the following information appears in the standard cost card for a company that makes only one product: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 5 pounds $ 11.00 per pound $ 55.00 Direct labor 2 hours $ 17.00 per hour $ 34.00 Variable manufacturing overhead 2 hours $ 2.50 per hour $ 5.00 During the most recent period, the following additional information was available: 20,000 pounds of material was purchased at a cost of $10.50 per pound. All of the material that was purchased was used to produce 3,900 units. 8,000 direct labor-hours were recorded at a total cost of $132,000. The actual variable overhead cost incurred during the period was $25,000. Assuming the company uses direct labor-hours to compute its predetermined overhead rate, what is the variable overhead efficiency variance
Answer:
$500 U
Explanation:
From the given information:
Standard hours allowed = 3900 × 2
= 7800 hours
The variable overhead efficiency variance = ( actual hours - standard hours) × standard variable overhead rate
= (8000 -7800) × $2.50
=(200) × $2.50
= $500 U (unfavourable)
Account for short-term debt and sales tax—two accounting cycles
The following transactions apply to Walnut Enterprises for 2016, its first year of operations:
a. Received $41,500 cash from the issue of a short-term note with a 7 percent interest rate and a one-year maturity. The note was made on April 1, Year 1.
b. Received $119,000 cash plus applicable sales tax from performing services. The services are subject to a sales tax rate of 8 percent.
c. Paid $70,500 cash for other operating expenses during the year.
d. Paid the sales tax due on $99,000 of the service revenue for the year. Sales tax on the balance of the revenue is not due until Year 2.
e. Recognize the accrued interest at December 31, Year 1.
The following transactions apply to Walnut Enterprises for Year 2:
a. Paid the balance of the sales tax due for Year 1.
b. Received $144,000 cash plus applicable sales tax from performing services.
c. The services are subject to a sales tax rate of 8 percent. Repaid the principal of the note and applicable interest on April 1, Year 2.
d. Paid $83,500 of other operating expenses during the year.
e. Paid the sales tax due on $119,000 of the service revenue.
f. The sales tax on the balance of the revenue is not due until Year 3.
Required
1. Record the 2016 transactions in general journal form.
2. Post the transactions to T-accounts.
3. Prepare a balance sheet, statement of changes in stockholders’ equity, income statement, and statement of cash flows for 2016.
4. Prepare the closing entries and post them to the T-accounts.
5. Prepare a post-closing trial balance.
6. Repeat Requirements a through e for 2017.
Answer:
Walnut Enterprises1. General Journal
Account Titles Debit Credit
a. Cash $41,400
7% Note Payable $41,400
To record the issuance of the one-year note payable.
b. Cash $128,520
Service Revenue $119,000
Sales Tax 9,520
To record the receipt of cash and Sales tax of 8%.
c. Other operating
expenses $70,500
Cash $70,500
To record the payment of the other operating expenses.
d. Sales Tax $7,920
Cash $7,920
To record payment of sales tax.
e. Interest Expense $2,173.50
Interest Payable $2,173.50
To record the interest expense.
Year 2: see attached.
Explanation:
a) Data and Analysis:
a. Cash $41,400 7% Note Payable $41,400
b. Cash $128,520 Service Revenue $119,000 Sales Tax Payable $9,520 Sales tax of 8%.
c. Other operating expenses $70,500 Cash $70,500
d. Sales Tax Payable $7,920 Cash $7,920
e. Interest Expense $2,173.50 Interest Payable $2,173.50
Year 2:
a. Sales Tax Payable $1,600 Cash $1,600
b. Cash $155,520 Service Revenue $144,000 Sales Tax $11,520
c. 7% Note Payable $41,400 Interest Expense $724.5 Interest Payable $2,173.50 Cash $44,298
d. Other operating expenses $83,500 Cash $83,500
e. Sales Tax $9,520 Cash $9,520
Bogart Company is considering two alternatives. Alternative A will have revenues of $160,000 and costs of $100,000. Alternative B will have revenues of $180,000 and costs of $125,000. Compare Alternative A to Alternative B showing incremental revenues, costs, and net income. What is the net income increase or decrease if you chose Alternative B instead of Alternative A
Answer and Explanation:
The computation of the increase or decrease in the net income when Alternative B should be selected rather Alternative A is given below:
Particulars Alternative A Alternative B
Revenue $160,000 $180,000
Less cost -$100,000 $125,000
Net income $60,000 $55,000
If we choose alternative B so there would be decrease in the net income by $5,000
As a member of UA Corporation's financial staff, you must estimate the Year 1 cash flow for a proposed project with the following data. What is the Year 1 cash flow? Do not round the intermediate calculations and round the final answer to the nearest whole number. Sales revenues, each year $40,000 Depreciation $10,000 Other operating costs $17,000 Interest expense $4,000 Tax rate 35.0%
Answer:
$15,850
Explanation:
Particulars Amount
Sales revenues, each year $40,000
Less : Depreciation $10,000
Less : Other operating costs $17,000
EBIT $13,000
Less : Interest expense $4,000
EBT/PBT $9,000
Less: Tax at 35% $3,150 ($9,000*35%)
PAT $5,850
Add: Depreciation $10,000
Cash flow after taxes $15,850
