Answer:
The following income is arranged as follows:
Sales, Cost of goods sold, Gross profit, Selling and administrative expenses, Depreciation expenses, Operating profit, Interest expense, Taxes, Earnings after taxes or income, Preferred stock dividends, Earning available to common stockholders.
Explanation:
Solution
An income statement starts with sales. Its second line is cost of goods sold. When cost of goods sold is deducted from sales, the resulting amount is the gross profit. So, gross profit is the third item after sales and cost of goods sold.
As stated earlier, selling and administrative expenses as well as depreciation expenses are the operating expenses. So, after gross profit, selling and administrative expenses are mentioned. Then depreciation expense is mentioned. When all these operating expenses are deducted from gross profit, the resulted amount is the operating profit.
Interest expense is the non-operating expense. After operating profit, interest expense is mentioned. When interest expense is deducted from operating profit, the resulted amount is the earnings before taxes.
After earning before taxes, tax expense is mentioned. When tax expense is deducted from earnings before taxes, the resulted amount is the earnings after taxes or net income.
After net income or earnings after taxes, preferred stock dividends is mentioned. After then, earning available to common stockholders is mentioned.
After net income or earnings after taxes, preferred stock dividends is mentioned. Whenever a company has preferred stock, the preferred stock holders have first right to get dividends from net income, before common stockholders. So, preferred stock dividends are deducted from net income to get the earnings available to common stockholders. So, earning available to common stockholders comes after preferred stock dividends and net income. The earnings available to common stockholders is the very bottom line of any income statement. Outstanding shares are not mentioned on the income statement.
Now,
A proper order of the income statement items are stated as follows:
SalesCost of goods soldGross profitSelling and administrative expensesDepreciation expensesOperating profitInterest expenseTaxesEarnings after taxes or incomePreferred stock dividendsEarning available to common stockholdersAccording to supply-side fiscal policy, increasing tax rates on wages and profits will: Group of answer choices result in higher unemployment and inflation. reduce both unemployment and the price level. lower the price level but raise unemployment. increase the real output as well as the price level.
Answer:
The correct answer is the third option: lower the price level but raise unemployment.
Explanation:
To begin with, supply-side fiscal policies are the ones that tend to benefit the supply that an economy puts with the purpose of increasing it believing that the raise of it will cause an increase in the level of production of the economy. Secondly, if tax rates on wages and profits increase then the firms will have less income in order to hire more workers to produce more and therefore that the level of unemployment will increase. And if the unemployment increases then the price level will decrease due to the fact that the firms will not have many workers to pay and therefore they will lower the prices in order to sell more because of its low costs regarding wages
The expected average rate of return for a proposed investment of $600,000 in a fixed asset, with a useful life of four years, straight-line depreciation, no residual value, and an expected total net income of $216,000 for the 4 years, is:____________A. 18%B. 15%C. 27%D. 9%
Answer:
18%
Explanation:
Average rate of return= Average net income/Average investment ×100/1
Average net income= $216,000/4
= $54,000
Average investment= $600,000/2
= $300,000
Therefore, the average rate of return is calculated as follows.
= $54,000/$300,000 ×100/1
= 0.18×100
=18%
Hence the average rate of return is 18%
Answer:
The answer is 18%
Explanation:
Average rate of Return
= expected total net income / Average investment
Average net income
=$216,000 / 4 = $54,000
Average investment
= $600,000 / 2 = $300,000
Then the expected average rate of return
= $54,000 / $300,000
= 0.18 x 100
= 18%
18% is the average rate of return
An investment is expected to generate annual cash flows forever. The first annual cash flow is expected in 1 year and all subsequent annual cash flows are expected to grow at a constant rate annually. We know that the cash flow expected in 4 years from today is expected to be $7500 and the cash flow expected in 5 years from today is expected to be $9000. What is the cash flow expected to be in 2 years from today?
Answer:
$5,208
Explanation:
First we need to calculate the growth rate using following formula
Growth Rate = (Final Value - Initial Value) / Initial Value
Placing Values in the formula = ($9,000 - $7,500) / $7,500 = $1,500 / $7,500 = 0.2 = 20%
As the cash flow in growing on constant rate of 20%. We need to calculate the prior years cash flow using following formula.
Cash Flow after growth = Current Cash flow ( 1 + growth rate)
Year 3 cash flow
$7,500 = Cash Flow of Year 3 ( 1 + 20% )
Cash Flow of Year 3 = $7,500 / 120%
Cash Flow of Year 3 = $6,250
Year 2 cash flow
$6,250 = Cash Flow of Year 2 ( 1 + 20% )
Cash Flow of Year 3 = $6,250 / 120%
Cash Flow of Year 3 = $5,208
Preparing statement of cash flows LO P2, P3.Use the following information of VPI Co to prepare a statement of cash flows for the year ended December 31 using the indirect method. (Amounts to be deducted should be indicated by a minus sign) Cash best prior year-end $40,000Increase in inventory 5.400 Depreciation expense 4,400 Cash received from using stock 8.600 Cash paid for dividende 1,400Gain on Sale of machinery 2,100 Cash received from sale of inventory 9.700 Increase in account payable 1,700 Net Increase 27.000 Decrease in account payable 3.000 VPI CO. Statement of Cash Flows (Indirect Method) For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities $ 0 rences Cash flows from investing activities $0 Cash flows from financing activities $0
Answer:
$85,500
Explanation:
VPI CO. Statement of Cash Flows (Indirect Method) For Current Year Ended December 31
Cash flows from operating activities
Net Income $ 27,000
Adjustment to reconcile net income to net cash provided by operating activities:
Income statement items not affecting cash
Depreciation expnese $ 4,400
Gain on sale of machinery $ (2,100)
Changes in current operating assets and liabilities:
Increase in inventory $ (5,400)
Increase in accounts payable $ 1,700
Decrease in accounts receivable $ 3,000
Net cash generated from operating activities $ 28,600(A)
Cash flow from investing activities:
Cash received from sale of Inventory $ 9,700
Net cash generated from investing activities $ 9,700 (B)
Cash flow from financing activities:
Cash received from issuing stock $8,600
Cash paid for dividends $ (1,400)
Net cash generated from financing activities (8,600-1,400) $ 7,200 (C)
Net increase in cash and cash equivalents (A+B+C) $ 45,500
Add: Beginning cash balance $40,000
Ending cash balance $85,500
ABC company has just purchased a life truck that has a useful life of 5 years. The engineer estimates that maintenance costs for the truck during the first year will be $1,000. As the truck ages, maintenance costs are expected to increase at a rate of $300 per year over the remaining life. Assume that the maintenance costs occur at the end of each year. The firm wants to set up a maintenance account that earns 12% interest per year. All future maintenance expenses will be paid out of this account. How much does the firm have to deposit in the account now
Answer:
Total amount to be invested today =$1,706.432
Explanation:
The first maintenance cost would occur a year from now, then the Present value will be equal to :
PV = 1,000 × 1.12^(-1)
PV = 892.857
The rest of the maintenance cost represents an annuity .
We will determine the PV of the annuity of $300 discounted at 12% per annum starting in year 2
PV = A × 1- (1+r)^(-n)
A- 300, r= 12%, n= 4
PV in year 1 = 300 × 1 - (1.12)^(-4)= 911.204804
PV in year 0= F × (1+r)^(-n)
= 911.204804 × 1.12^(-1)= 813.57
Total amount to be invested today = 813.57 + 892.85=1706.43
Total amount to be invested today =$1,706.432
Kermit bought a production line 5 years ago for $35,000. At that time it was estimated to have a service life of 10 years and salvage at the end of its service life of $10,000. Kermit's CFO recently proposed to replace the old line with a modern line expected to last 15 years and cost $95,000. This new line will provide $7,000 savings in annual operating and maintenance costs, and have a salvage value of $15,000 at the end of 15 years. The seller of the new line is willing to accept the old line as a trade-in for its current fair market value, which is $12,000. The CFO estimates that if the old line is kept for 5 more years, its salvage value will be $6,000. We are looking at performing a replacement analysis. The defender must be analyzed using a first cost of ___________ and a salvage value of ____________ for __________ years. The challenger must be analyzed using a first cost of __________ and a salvage value of __________ for _________ years.
Answer: The defender must be analyzed using a first cost of _____$12,000______ and a salvage value of _____$6,000_______ for ____5______ years. The challenger must be analyzed using a first cost of ____$95,000______ and a salvage value of _____$15,000_____ for _____15____ years.
Explanation:
The defender would first be analyzed using the first cost of the machine which was $12,000 and it salvaged value of $6,000 for a periodic of 5years.
While the challenger would be analyzed using using a first cost of $95,000 and a salvaged value of $15,000 over a period of 15years.
At the end of August, the first month of operations, the following selected data were taken from the financial statements of Tucker Jacobs, an attorney:Net income for August$112,500Total assets at August 31650,000Total liabilities at August 31225,000Total stockholders' equity at August 31425,000In preparing the financial statements, adjustments for the following data were overlooked:1. Unbilled fees earned at August 31, $31,900.2. Depreciation of equipment for August, $7,500.3. Accrued wages at August 31, $5,200.4. Supplies used during August, $3,000.Instructions1. Journalize the entries to record the omitted adjustments.2. Determine the correct amount of net income for August and the total assets, liabilities, and stockholders' equity at August 31.
Answer:
1. See the journal below.
2. Correct answers are:
a. Correct amount of net income = $ 128,700.
b. Correct amount of total assets = $671,400.
c. Correct amount of total liabilities = $230,200.
d. Correct amount of stockholders' equity = $441,200
Explanation:
1. Journalize the entries to record the omitted adjustments
Details Dr ($) Cr ($)
Accounts Receivable 31,900
Unbilled fees earned 31,900
To record the unbillled fees earned. Depreciation 7,500
Accumulated Depreciation 7,500
To record the depreciation expenses.
Wages Expense 5,200
Wages Payable 5,200
To record accrued wages expense.
Supplies Expense 3,000
Supplies 3,000
To record the supplies expenses.
2. Determine the correct amount of net income for August and the total assets, liabilities, and stockholders' equity at August 31.
a. Correct amount of net income = Net income recorded + Unbilled fees earned - Depreciation - Accrued wages - supplies expense = $112,500 + $31,900 - $7,500 - $5,200 - $3,000 = $ 128,700.
b. Correct amount of total assets = Recorded total assets + Unbilled fees earned - depreciation - Supplies = $650,000 + 31,900 - $7,500 - $3,000 = $671,400.
c. Correct amount of total liabilities = Recorded total liabilities + Accrued wages = $225,000 + 5,200 = $230,200.
d. Correct amount of stockholders' equity = Correct amount of total assets - Correct amount of total liabilities = $671,400 - $230,200 = $441,200
Required information
Use the following information for Quick Studies below.
[The following information applies to the questions displayed below.]
The following is the adjusted trial balance of Sierra Company.
Account Title Debit Credit
Cash $ 35,000
Prepaid insurance 2,000
Notes receivable (due in 5 years) 7,000
Buildings 95,000
Accumulated depreciation–Buildings $ 27,000
Accounts payable 10,000
Notes payable (due in 3 years) 10,500
H. Sierra, Capital 33,000
H. Sierra, Withdrawals 8,500
Consulting revenue 84,500
Wages expense 5,000
Depreciation expense–Buildings 9,500
Insurance expense 3,000
Totals $ 165,000 $ 165,000
Question Requirement:
Use the information adjusted trial balance to prepare Sierra Company's classified balance sheet as of December 31. SIERRA COMPANY Balance Sheet December 31:
Answer:
SIERRA COMPANY Balance Sheet December 31:
Current Assets:
Cash $35,000
Prepaid insurance 2,000 $37,000
Long-Term Assets:
Notes receivable (due in 5 years) 7,000
Buildings 95,000
Accumulated depreciation 27,000 68,000 $75,000
Total Assets $112,000
Current Liabilities:
Accounts payable 10,000
Long-term Liabilities:
Notes payable (due in 3 years) 10,500 $20,500
H. Sierra, Capital $33,000
H. Sierra, Withdrawals 8,500 24,500
Retained Earnings 67,000 $91,500
Total Liabilities + Equity $112,000
Explanation:
a) Sierra Company's Income Statement:
Consulting revenue $84,500
Wages expense -5,000
Depreciation expense–Buildings -9,500
Insurance expense -3,000
Net Income $67,000
b) Here, the Net Income is equal to the Retained Earnings, which is carried forward.
c) To prepare a balance sheet, which contains permanent accounts, the temporary accounts or periodic accounts must be eliminated in the Income Statement summary. The resulting figure is then carried forward to the balance sheet. Permanent accounts are the accounts that are carried forward to the next accounting period. They are stated in the balance sheet according to their various assets, liabilities, and equity classifications.
Based on the given data, the net income will be $67,000
Current Assets:
Cash $35,000
Prepaid insurance 2,000 $37,000
Long-Term Assets:
Notes receivable (due in 5 years) 7,000
Buildings 95,000
Accumulated depreciation 27,000 68,000 $75,000
Total Assets $112,000
Current Liabilities:
Accounts payable 10,000
Long-term Liabilities:
Notes payable (due in 3 years) 10,500 $20,500
H. Sierra, Capital $33,000
H. Sierra, Withdrawals 8,500 24,500
Retained Earnings 67,000 $91,500
Total Liabilities + Equity $112,000
a) Income Statement of Sierra Companies-
Consulting revenue $84,500
Wages expense -5,000
Depreciation expense–Buildings -9,500
Insurance expense -3,000
Net Income $67,000
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On June 30, Coral, Inc. finished Job 750 with total job costs of $ 4 comma 400, and transferred the costs to Finished Goods Inventory. On July 6, Coral sold goods to a customer for $ 5,800 cash. Which of the following is the correct journal entry to record the cost of goods sold? Assume the perpetual inventory system is used.
a. debit Finished Goods Inventory $4,100 and credit Cost of Goods Sold $4,100
b. debit Cost of Goods Sold $4,100 and credit Work-in-Process Inventory $4,100
c. debit Work-in-Process Inventory $4,100 and credit Cost of Goods $4,100
d. debit Cost of Goods Sold $4,100 and credit Finished Goods Inventory $4,100
Answer:
The correct option is D,debit Cost of Goods Sold $4,100 and credit Finished Goods Inventory $4,100
Explanation:
The total job costs is $4,100 not $4,400 ,which then means that the cost of goods sold is $4,100.
The appropriate entry for such sale is to credit merchandise inventory since the inventory reduces due to such sale being made while cost of goods sold is debited with the same amount.
In a nutshell, the correct option is D,
Akwamba made this statement ‘organisations cannot be successful if managers fail to pay attention to the forces in the external environment’. Do you agree or not? Justify using practical examples (9 marks)
Answer:
I agree
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Tamarisk Company leases a building and land. The lease term is 4 years and the annual fixed payments are $720,000. The lease arrangement gives Tamarisk the right to purchase the building and land for $13,750,000 at the end of the lease. Based on an economic analysis of the lease at the commencement date, Tamarisk is reasonably certain that the fair value of the leased assets at the end of lease term will be much higher than $13,750,000.
What are the total lease payments in this lease arrangement?
Answer:
$17,790,000
Explanation:
The computation of the total lease payment is shown below:
As we know that
Total lease payment is
= [(Annual lease payment × Number of years of the lease) + Value of right to purchase at the building and land at the end of the year]
= ($720,000 × 7) + $12,750,000
= $17,790,000
We simply applied the above formula so that the total lease payments could arrive
To live comfortably in retirement, you decide you will need to save $2 million by the time you are 65 (you are 30 years old today). You will start a new retirement savings account today and contribute the same amount of money on every birthday up to and including your 65th birthday. Using TVM principles, how much must you set aside each year to make sure that you hit your target goal if the interest rate is 5%? What flaws might exist in your calculations, and what variables could lead to different outcomes? What actions could you take ensure you reach your target goal?
Answer: Please refer to Explanation
Explanation:
1) You want to have $2 million when you are 65 which is 35 years from now. The interest rate is 5% and you need to know how much to deposit per year to get to that level. The $2 million is therefore the future value of your contributions which makes this an Annuity.
To calculate for the Annuity amount use the following formula,
FV of Annuity = Annuity ( ( (1 + i)^ n -1 )/ i )
2,000,000 = A ( ( ( 1 + 5%) ^ 35 -1 ) / 5%)
2,000,000 = A ( (1.05^35 -1 )/5%)
2,000,000 = A (90.3203074)
A = 2,000,000/90.3203074
A = $22,143
You should set aside $22,143 every year.
2) The major flaw in the calculation is the assumption that the interest rates will remain the same over the 35 years. This is almost impossible and will affect the amount that would need to be deposited every year to achieve the target. If the interest rate should increase then it will increase the amount that you are to get meaning you can get more than $2 million then you would not have to deposit as much to get to $2 million. If it decreases however, you will have to deposit more to get to the required $2 million because the amount earned in interest will not enable you to get to $2 million in that timeframe. .
To live in conformably you need to retire and decide that you need to pay about 2 million dollars to save and by the time of 65 need to start a retirement plan, the TVM concept the target goals has a interest rate of 5%.
For which we need to calculate the
FV of Annuity = Annuity ( ( (1 + i)^ n -1 )/ i )2,000,000 = A ( ( ( 1 + 5%) ^ 35 -1 ) / 5%)2,000,000 = A ( (1.05^35 -1 )/5%)2,000,000 = A (90.3203074)A = 2,000,000/90.3203074Hence A = $22,143.Learn more about the to live.
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Portions of the financial statements for Alliance Technologies are provided below. Alliance Technologies Income Statement For the year ended December 31, 2018Net sales $405,000Expenses:Cost of goods sold $235,000 Operating expenses 70,000Depreciation expense 17,000 Income tax expense 27,000 Total expenses 349,000Net income $56,000 Alliance Technologies Selected Balance Sheet Data December 31, 2018, compared to December 31, 2017Decrease in accounts receivable $7,000Increase in inventory 14,000Decrease in prepaid rent 10,000Increase in salaries payable 6,000Decrease in accounts payable 9,000Increase in income tax payable 24,000Required:Prepare the operating activities section of the statement of cash flows for Alliance Technologies using the direct method.
Answer:
Net cash flow from Operating activities $ 97,000.00
Explanation:
The problem can not be solved on the answer box here, that is why i made use of the microsoft word table in other to understand the solution properly
The Net cash flow from the Operating activities is $97,000.
Alliance Technologies
Cash Flow Statement
For year ended 31st December 2018
Cash Flows from Operating Activity
Net Income $56,000
Adjustments to reconcile net income
to net cash from operations
Depreciation expense $17,000
Changes in working Capital
Decrease in Accounts receivables $7,000
Increase in Inventory $(14,000)
Decrease in prepaid rent $10,000
Increase in salaries payable $6,000
Decrease in accounts payable $(9,000)
Increase in income tax payable $24,000 $41,000
Net cash flow from Operating activities $97,000
Therefore, the Net cash flow from the Operating activities is $97,000.
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Mention and explain the different types of checks, and is the type of the check effect
the indorsement?
Answer:
There are types of checks that are used in endorsements.
Explanation:
The checks are different types that are used in endorsements by bearers
The Bank cheque The order chequeThe bearer chequeThe blank chequeThe counter chequeThe stale chequeThe mutilated chequeThe post-dated chequeThe open chequeThe crossed chequeThe gift chequeThe traveler chequeThe banker chequeThe outstanding chequeThe payroll register of Heritage Co. indicates $13,440 of social security withheld and $3,360 of Medicare tax withheld on total salaries of $224,000 for the period. Federal withholding for the period totaled $43,140. Retirement savings withheld from employee paychecks were $2,660 for the period. Journalize the entry to record the period’s payroll. Refer to the Chart of Accounts for exact wording of account titles.
Answer and Explanation:
The journal entries are shown below:
Salary & Wages expense $224,000
To social security Payable $13,440
To Medicare tax Payable $3,360
To Federal Tax Witholding Payable $43,140
To Retirement contribution payable $2,660
To Salary & Wages Payable $161,400 (Balancing figure)
(Being the period payroll is recorded)
For recording this we debited the salary & wages expense as it increased the expenses and credited all other accounts as it increased the liabilities
Primo Industries collected $105,000 from customers in 2019. Of the amount collected, $25,000 was for services performed in 2018. In addition, Primo performed services worth $40,000 in 2019, which will not be collected until 2020. Primo Industries also paid $72,000 for expenses in 2019. Of the amount paid, $30,000 was for expenses incurred on account in 2018. In addition, Primo incurred $42,000 of expenses in 2019, which will not be paid until 2020.
Required:
a. Compute 2014 cash-basis net income.
b. Compute 2014 accrual-basis net income.
Answer:
a. $33,000.
b. $36,000.
Explanation:
Net income is calculated as sales minus cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses. It is also called net earnings.
Now, Cash accounting recognizes revenue and expenses only when money changes hands, but accrual accounting recognizes revenue when it's earned, and expenses when they're billed (but not paid).
a. 2014 Cash-basis net income:
Primo Industries collected $105,000 from customers in 2019
Primo Industries also paid $72,000 for expenses in 2019
=105,000-72,000
=$33,000
b. 2014 accrual-basis net income.
=(105,000-25000+40000)-(72000-30000+42000)
=120000-84000
=$36,000
You are working as accounting information system(AIS) expert in H and H, a multinational entity(MNE) for couple of years inSpain. One of its subsidiaries in an emerging country of Asia is developing their AIS. Management selected you for this expatriate assignment for the next three years. Your boss will have a metting with you next week. What would you discuss with your boss?
Answer:
stakeholders for the project, documented goal and objective of the assignment, discuss SMART(specific, measurable, agreed, reaganlistic, timeframe) for the assignment, resources for the assignment, GANTT chart of the assignment, risk assessment for the project.
Explanation:
Before starting any major assignment, one must set its goals and objectives very clearly. A list of milestone and progress measuring report must be prepared so that tracking is easy. Also, all the associated risks must be analyze and catered for
The current sections of Sandhill Co.'s balance sheets at December 31, 2021 and 2022, are presented here. Sandhill Co's net income for 2022 was $137,700. Depreciation expense was $24,300. 2022 2021 Current assets $89,100 Cash $94,500 Accounts receivable 72,000 80,100 151,200 Inventory 154,800 Prepaid expenses 24,300 19.800 $342000 $343,800 Total current assets Current liabilities Accrued expenses payable $13,500 $4,500 Accounts payable 76,500 82800 $90,000 Total current liabilities $87.300
Prepare the net cash provided (used) by operating activities section of the company's statement of cash flows for the year ended December 31, 2022, using the indirect method.
Answer and Explanation:
The prepartion of the net cash provided or used by operating activities section of the cash flow statement is presented below:
Cash flows from operating activities
Net income $137,700
Adjustments made
Depreciation expense $24,300
Add: Decrease in Accounts receivable $8,100 ($72,000 - $80,100)
Add: Decrease in inventory $3,600 ($151,200 - $154,800)
Less: Increase in Prepaid expenses -$4,500 ($24,300 - $19,800)
Add: Increase in accrued expenses payable $9,000 ($13,500 - $4,500)
Less: Decrease in accounts payable -$6,300 ($76,500 - $82,800)
Total of adjustments $34,200
Net cash provided by operating activities $171,900
The negative sign represents cash outflow and positive sign represents cash inflow
if data links connecting different parts of the united states were to fail, gdp would fall. if, on the other hand, the network of state-of-the-art, high-speed connections were doubled in size, what would happen
Answer:
(1). Increament in GDP.
(2). Decrease In marginal product.
(3). POSITIVE marginal Product (MP).
Explanation:
"If data links connecting different parts of the united states were to fail, gdp would fall. if, on the other hand, the network of state-of-the-art, high-speed connections were doubled in size" what will happen are given below;
=> There will be an increase in the Gross Domestic Product (GDP).
=> There will be a reduction In the value of the marginal Product (MP). The marginal Product (MP) will reduce as far more than the original network.
=> The marginal Product (MP) will be POSITIVE.
Option A to buy new has a monthly payment of 338 dollars for 60 months, up-front cost of 2,500 dollars, and 275 dollars a month for insurance and gas. Option B to lease new has a monthly payment of 229 dollars for 36 months, up-front cost of 3,925 dollars, and 275 dollars a month for insurance and gas. Option C to buy used has a monthly payment of 250 dollars for 36 months, up-front cost of 2,000 dollars, and 225 dollars per month for insurance and gas. Based on your budget, which transportation option is the best financial decision for you? Explain your answer in at least two sentences.
Answer: Option C is the best financial decision.
Explanation:
Given Data:
Option C
Monthly payment = $250 For 36 months
Upfront = $2,000 ( down payment ).
Insurance and gas = $225/month.
Option C, is a more economical Transportation option because it’s total cost is lesser which is $11,225 compared to option A which is $23,055 and option B $12,444
Answer:
on edge
Explanation:
Option C is probably the best choice for my budget. The other options will require too high of an up-front cost and high monthly payments. They also include restrictions.
Cost of Goods Sold, Cost of Goods Manufactured
Glenville Company has the following information for April:
Cost of direct materials used in production $48,000
Direct labor 57,000
Factory overhead 34,000
Work in process inventory, April 1 35,000
Work in process inventory, April 30 40,000
Finished goods inventory, April 1 25,000
Finished goods inventory, April 30 16,000
For April, determine
A. The cost of goods manufactured.
B. The cost of goods sold.
Using the data given, prepare a statement of Cost of Goods Manufactured.
Glenville Company
Statement of Cost of Goods Manufactured
Work in process inventory, April 1 Y $72,300
Cost of direct materials used in production $280,000
Direct labor 324,000
Factory Overhead 188,900
Answer:
Instructions are below.
Explanation:
Giving the following information:
Cost of direct materials used in production $48,000
Direct labor 57,000
Factory overhead 34,000
Work in process inventory, April 1= 35,000
Work in process inventory, April 30= 40,000
Finished goods inventory, April 1= 25,000
Finished goods inventory, April 30= 16,000
A. To calculate the cost of goods manufactured, we need to use the following formula:
cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP
cost of goods manufactured= 35,000 + 48,000 + 57,000 + 34,000 - 40,000
cost of goods manufactured= $134,000
B. To calculate the cost of goods sold, we need to use the following formula:
COGS= beginning finished inventory + cost of goods manufactured - ending finished inventory
COGS= 25,000 + 134,000 - 16,000
COGS= $143,000
C. Prepare a statement of Cost of Goods Manufactured.
Work in process inventory, April 1 Y $72,300
Cost of direct materials used in production $280,000
Direct labor 324,000
Factory Overhead 188,900
cost of goods manufactured= $865,200
Developing and evaluating solutions to reduce the gap between desired process performance and current performance is the final step in the six sigma DMAIC approach for process improvement. True False
Answer: False
Explanation:
The six sigma DMAIC approach for process improvement is a way of improving performance in such a way that it makes the company more profitable as well as improving customer relations and satisfaction.
The DMAIC is an acronym that stands for the the steps in the process as seen in the graph attached.
The above statement about Developing and Evaluating Solutions to make a company perform better is not the final step in the process as it falls under the fourth step, which is to Improve.
The final step is Control. Here the main focus is on preserving what has been achieved. It works by monitoring the situation and ensuring that the process improves if a loophole is spotted.
The First National Bank of Nelsonville has no excess reserves when a new deposit of $10,000 is made. The required reserve ratio for all banks is 5 percent. How much is the largest possible increase in checking account balances throughout the entire banking system
Answer:
$950
Explanation:
Reserve ratio is defined as the percentage amount of deposit that a bank is instructed by the governing central bank to keep as cash reserve. This is used to control the money supply in the economy as the the check - able amount that are subjected to withdrawal is limited to the funds available after the reserve ratio has been considered.
Workings
New deposit - $10,000
Required reserve ratio - 5%
No existing excess ratio as at the time of deposit.
Reserve ratio - 5%*10000 = 50
Increase in checking account = 1000-50
= $950
Equipment was acquired on January 1, 2019 at a cost of $190,000. The equipment was originally estimated to have a salvage value of $22,000 and an estimated life of 10 years. Depreciation has been recorded through December 31, 2021 using the straight-line method. On January 1, 2022, the estimated salvage value was revised to $28,000 and the useful life was revised to a total of 9 years.Prepare the journal entry to record depreciation expense for 2022. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)Depreciation expense for 2022$enter the Depreciation expense for 2017 in dollars Adjusting journal entry at 12/31/22:DateAccount Titles and ExplanationDebitCreditDec. 31
Answer:
Journal:
Dec. 31, 2022:
Debit Depreciation Expense $18,600
Credit Accumulated Depreciation $18,600
To record depreciation expense for the year.
Explanation:
a) Depreciation charge for each of the 3 years, calculated as ($190,000 - $22,000)/10 = $16,800
2019: $16,800
2020: $16,800
2021: $16,800
Accumulated Depreciation to date = $50,400 ($16,800*3)
b) Book Value on January 1, 2022 = $139,600 ($190,000 - $50,400)
c) New Depreciation charge from 2022 = $18,600 ($139,600 - $28,000) /6 years, the remaining useful life based on the revised estimate.
d) There is adjusting journal entry. Depreciation is an estimate based on judgement and past events. Judgement can change to address current events. So, there is no need adjusting the entries for the previous three years.
Algoma, Inc., signs a five-year lease for office equipment with Office Solutions. The present value of the lease payments is $15,499. Prepare the journal entry that Algoma records at the inception of this finance lease.
Answer:
Dr. Lease asset office equipment $15,499
Cr. Lease Liability $15,499
Explanation:
A capital lease is a lease between two parties in which a party transfer leases asset to in exchange of lease payments.
To make a lease finance lease following criteria must be fulfilled.
The asset will be transferred to lessee at the end of lease periodAgreement must contain bargain purchase optionLease period must be 75% or more of useful life of assetValue of lease must be equal or more than the market value of assetBarriers to International Trade Countries often use various government regulations to manipulate the amount of goods and services imported from other countries. This activity is important because it will help you to understand the effects of trade protectionism on the overall international trading atmosphere. The goal of this exercise is to challenge your knowledge of the different types of international trade barriers. Select the barrier to international trade that each statement best describes. 1. A complete ban on trade with another country or a prohibition on trading specific types of products, services, or technology to another country 2. A customs duty or tax levied mainly on imports 3. The United States only allows a certain amount of aluminum sheet to come into the country from China 4. The United States recently raised taxes on all imported solar panels in order to attempt to make U.S.-made solar panels more competitive 5. A limit on the numbers of a product that can be imported 6. The United States does not export any materials to North Korea that may help North Korea bolster its nuclear program.
Answer: Please refer to Explanation
Explanation:
1. Embargoes and sanctions
When a trade embargo or sanctions are in play, depending on the strength of the nation or International organisation that imposed it, countries are not allowed to trade with the country that is under an embargo. Sometimes the trade embargo can be on all products and sometimes just specific sectors are targeted. An example is the current United States embargo on Venezuela which targets their oil sector and as such most countries are avoiding buying Venezuelan oil.
2. Tariffs
This is a method of reducing the amount of a certain good imported from outside. Tariffs are usually introduced to protect the domestic producers and supplier in an economy and work by taxing imports or placing a customs duty on them. They are usually imposed when the imports are cheaper than domestic Production.
3. Import Quota
Another way to protect the domestic economy. In this scenario, a country allows the import of a certain good only up to an extent for a period which is usually a year. For instance, the United States in this scenario could say that in 2020 only 500 megatons of Aluminum are allowed into the country from China. After that, no more is allowed until 2021.
4. Tariff.
This is a Tariff and as earlier explained, is meant to protect the domestic producers by taxing imports that are cheaper.
5. Import Quota.
This is clearly an import Quota as earlier described because the country is limiting the amount of a certain good that can come into it.
6. Embargoes and Sanctions.
This is a clear example of an embargo. The United States is limiting the amount of goods exported to North Korea because they are under sanctions and embargoes. The United States and Western nations do not want to export anything to North Korea that could aid it's Nuclear Industry so it is a targeted embargo on their nuclear industry.
Textra Plastics produces parts for a variety of small machine manufacturers. Most products go through two operations, molding and trimming, before they are ready for packaging. Expected costs and activities for the molding department and for the trimming department for 2017 follow. (Round "OH rate and cost per unit" answers to 2 decimal places.)
Molding Trimming
Direct labor hours 52,000 DLH 48,000 DLH
Machine hours 30,500 MH 3,600 MH
Overhead costs $ 730,000 $ 590,000
Data for two special order parts to be manufactured by the company in 2017 follow:
Part A27C Part X82B
Number of units 9,800 units 54,500 units
Machine hours
Molding 5,100 MH 1,020 MH
Trimming 2,600 MH 650 MH
Direct labor hours
Molding 5,500 DLH 2,150 DLH
Trimming 700 DLH 3,500 DLH
Answer and Explanation:
1. The computation of the departmental overhead rate for the molding department based on machine hours and for trimming department based on direct labor hours are shown below:
For molding department
= Overhead cost ÷ machine hours
= $730,000 ÷ 30,500 machine hours
= $23.93 per machine hour
For trimming department
= Overhead cost ÷ direct labor hours
= $590,000 ÷ 48,000 direct labor hours
= $12.29 per machine hour
2. Now the total overhead cost for Part A27C and Part X82B and its overhead cost per unit are as follows
Part A27C Activity Departmental For Total Overhead
Driver OH Rate each Cost
Molding Machine
Hours $23.93 Machine $122,065.57
Hour (5,100 MH × 23.93 )
Trimming Direct
Labor Hours $12.29 Direct $8,604.17
Labor Hour (700 DLH × 12.29 )
Total Overheads $130,669.74 ÷ 9,800 units
Overhead per unit $13.33
Part X82B Activity Departmental For Total Overhead
Driver OH Rate each Cost
Molding Machine
Hours $23.93 Machine $24,413.11
Hour (1,020 MH × 23.93 )
Trimming Direct
Labor Hours $12.29 Direct $43,020.83
Labor Hour (3,500 DLH × 12.29)
Total Overhead $674,33.95 ÷ 54,500 units
Overhead per unit $1.24
Purchase-Related Transactions Using Perpetual Inventory System The following selected transactions were completed by Niles Co. during March of the current year:
Mar. 1. Purchased merchandise from Haas Co., $13,900, terms FOB shipping point, 2/10, n/eom. Prepaid freight of $550 was added to the invoice.
5. Purchased merchandise from Whitman Co., $10,650, terms FOB destination, n/30.
10. Paid Haas Co. for invoice of March 1.
13. Purchased merchandise from Jost Co., $7,100, terms FOB destination, 1/10, n/30.
14. Issued debit memo to Jost Co. for $1,300 of merchandise returned from purchase on March 13.
18. Purchased merchandise from Fairhurst Company, $9,600, terms FOB shipping point, n/eom.
18. Paid freight of $310 on March 18 purchase from Fairhurst Company.
19. Purchased merchandise from Bickle Co., $13,800, terms FOB destination, 2/10, n/30.
23. Paid Jost Co. for invoice of March 13, less debit memo of March 14.
29. Paid Bickle Co. for invoice of March 19.
31. Paid Fairhurst Company for invoice of March 18.
31. Paid Whitman Co. for invoice of March 5.
Required: Journalize the entries to record the transactions of Britt Co. for March. Mar. 1 Mar. 5 Mar. 10 Mar. 13 Mar. 14 Mar. 18-purchase Mar. 18-freight Mar. 19 Mar. 23 Mar. 29 Mar. 31-Fairhurst Mar. 31-Whitman
Answer:
Mar. 1
Merchandise $13,900 (debit)
Freight Charges Prepaid $550 (debit)
Accounts Payable : Haas Co. $13,900 (credit)
Cash $550 (credit)
Mar. 5
Merchandise $10,650 (debit)
Accounts Payable : Whitman Co. $10,650 (credit)
Mar. 10
Accounts Payable : Haas Co. $13,622 (debit)
Cash $13,622 (credit)
Mar. 13
Merchandise $7,100 (debit)
Accounts Payable : Jost Co. $7,100 (credit)
Mar. 14
Accounts Payable : Jost Co. $1,300 (debit)
Merchandise $1,300 (credit)
Mar. 18-purchase
Merchandise $9,600 (debit)
Accounts Payable : Fairhurst Company $9,600 (credit)
Mar. 18-freight
Freight Charges $310 (debit)
Cash $310 (credit)
Mar. 19
Merchandise $13,800(debit)
Accounts Payable : Bickle Co. $13,800 (credit)
Mar. 23
Accounts Payable : Jost Co. $5,742 (debit)
Cash $5,742 (credit)
Mar. 29
Accounts Payable : Bickle Co. $13,524 (debit)
Cash $13,524 (credit)
Mar. 31-Fairhurst
Accounts Payable : Fairhurst. $9,600 (debit)
Cash $9,600 (credit)
Mar. 31-Whitman
Accounts Payable : Whitman $10,650 (debit)
Cash $10,650 (credit)
Explanation:
When Merchandise is purchased on Account,
Recognize the Merchandise Account (debit) and recognize the Accounts Payable Account (credit).
When Merchandise is finally paid for.
First determine if payment fall within discount period.
Also determine if there were previous returns to supplier.
Then de-recognize the Accounts Payable Account and recognize the Cash Payment to the extend of amount paid.
Over the past 4 years, Cardi, age 28, has contributed a total of $20,000 to a Roth IRA. The current balance is $25,000. She was tired of renting, so this year she took a distribution of $15,000 for a down payment on a home. What amount of the distribution should she include in her gross income this year
Answer:
$0
Explanation:
According to the scenario, computation of the given data are as follow:-
Contributed amount = $20,000
Distribution amount = $15,000
As we know,
Taxable amount = Distribution amount - contribution amount
= $15,000 - $20,000
= - $5,000
The contribution amount is $20,000 more than the distribution amount $15,000. So distribution amount is not taxable.
She included $0 amount in her gross income this year.
On January 2, Todd Company acquired 40% of the outstanding stock of McGuire Company for $205,000. For the year ending December 31, McGuire earned income of $48,000 and paid dividends of $14,000. Required: Prepare the entries for Todd Company for the purchase of the stock, share of McGuire income, and dividends received from McGuire.
Answer:
The entries for Todd Company for the purchase of the stock, share of McGuire income, and dividends received from McGuire would be as follows:
debit credit
jan 2
Investment in equity $205,000
cash $205,000
[Investment made]
dec3 1
Investment in equity $19,200
share in net income of affilates $19,200
[share in net income recorded]
dec 31
cash $5,600
dividend income $5,600
[dividend received]
Explanation:
The entries for Todd Company for the purchase of the stock, share of McGuire income, and dividends received from McGuire would be as follows:
debit credit
jan 2
Investment in equity $205,000
cash $205,000
[Investment made]
dec3 1
Investment in equity $19,200
share in net income of affilates $19,200
[share in net income recorded]
share in net income of affilates=$48,000*0.40=$19,200
dec 31
cash $5,600
dividend income $5,600
[dividend received
dividend income=14000*0.40=$5,600
