Answer:
The adjusting journal entry for the Bad Debt Expense will include a credit to Allowance for Doubtful Accounts of A. $ 4,000
Explanation:
Ending balance in Accounts Receivable = Beginning balance in Accounts Receivable + Sales on credit - Cash Collected = $200,000 + $1,000,000 - $800,000 = $400,000
Drew estimates that 2% of their ending accounts receivable will eventually not be collected.
Estimated uncollectible = 2% x $400,000 = $8,000
Drew Corp had a beginning credit balance in the Allowance for Doubtful Accounts of $4,000. Bad debts expense = $8,000 - $4,000 = $4,000
The adjusting journal entry for the Bad Debt Expense:
Debit Bad debts expense $4,000
Credit Allowance for Doubtful Accounts $4,000
104. During 2017, Logan Corporation acquired a mineral mine for $4,000,000 of which $400,000 was ascribed to land value after the mineral has been removed. Geological surveys have indicated that 10 million units of the mineral could be extracted. During 2017, 1, 500,000 units were extracted and 1,000,000 units were sold. What is the amount of depletion expense for 2017
Answer:
$540,000
Explanation:
Depletion expense = (unit extracted in a year/ total units ) x (Cost- salvage value)
(1, 500,000 / 10,000,000) x (
$4,000,000 - $400,000) = 0.15 × $3,600,000 = $540,000
I hope my answer helps you
The Blending Department for ArkYork Paints started October with 500 gallons in process and started in production 9 comma 000 gallons. During the month, 6 comma 500 gallons were completed and transferred to the next department. Ending work-in-process was 3 comma 000 gallons (100% complete with respect to direct materials and 10% complete for conversion costs). The department uses the weighted-average method. The Blending Department incurred the following costs: LOADING...(Click the icon to view the costs.) 7. Prepare a production cost report for the Blending Department for the month of October. (Enter cost per equivalent units to the nearest cent. Abbreviations: EUP = Equivalent Units of Production.)
Answer:
Production cost report for the Blending Department for the month of October
Inputs
Units
Opening Work In Process 500
Started 9,000
Total 9,500
Outputs
Units
Completed and Transferred 6,500
Closing Work In Process 3,000
Total 9,500
Explanation:
The concept of equivalent units measures the number of units completed in terms of completion stage of the the inputs.
Final answer:
A production cost report using the weighted-average method includes calculating equivalent units for direct materials and conversion costs and computing the cost per equivalent unit. Costs are summed and divided by the equivalent units; the report shows production efficiency and cost management.
Explanation:
The question you've presented revolves around the preparation of a production cost report for the Blending Department at ArkYork Paints using the weighted-average method. Since no specific cost data was provided, a general approach to creating such a report includes calculating the equivalent units of production (EUP) for both direct materials and conversion costs, computing the cost per equivalent unit, and then preparing a summary of costs for units transferred out and ending work in process.
In the scenario described, 500 gallons were in process at the start of the month, and an additional 9,000 gallons were started during the month. By the month's end, 6,500 gallons were completed and the remaining 3,000 gallons were 100% complete with respect to direct materials and 10% complete for conversion costs. To determine the EUP, one would add the completed gallons to the equivalent completed portion of the ending work in process.
Costs for direct materials and conversion must be added to those carried over from the prior period (beginning inventory) plus those added during the current period. The total costs are then divided by equivalent units to obtain the cost per equivalent unit. The report would summarize these figures and provide insights into the department's production efficiency and cost management.
Burns offers Realtor a commission of 10 percent of the sales price if Realtor can find a buyer for the Burns Building for $500,000. Realtor spends funds to research and obtain potential-buyer contact information and locates Walters, who is willing to accept the $500,000 offer to sell from Burns. Before any transaction takes place, Burns revokes his offer to Realtor and refuses to sell the property to Walters. Burns's revocation is:
Answer:
Burns’s revocation is not effective
Explanation:
Revocation can be defined as the
the cancellation of either a decree, decision, or even a promise and the making void of some deed which was previously existing.
Therefore according to the information given Burns’s revocation is not effective because Burns’s promise to pay for a particular performance which isa unilateral contract which was said to be rendered irrevocable once Realtor performed by finding a buyer for the building.
Answer:
Burns’s revocation is not effective
Explanation:
Varto Company has 12,600 units of its sole product in inventory that it produced last year at a cost of $31 each. This year’s model is superior to last year’s, and the 12,600 units cannot be sold at last year’s regular selling price of $49 each. Varto has two alternatives for these items: (1) they can be sold to a wholesaler for $13 each or (2) they can be processed further at a cost of $272,300 and then sold for $34 each. Should Varto sell the products as is or process further and then sell them?
Answer:
It is more profitable to sell the units as-is.
Explanation:
Giving the following information:
Number of units= 12,600
Varto has two alternatives for these items:
(1) they can be sold to a wholesaler for $13 each
(2) they can be processed further for $272,300 and then sold for $34 each.
The first cost of $31 is a sunk cost, it will remain no matter which option is chosen. We will not take it into account for the decision making process.
Option 1:
Effect on income= 12,600*13= $163,800
Option 2:
Effect on income= 12,600*34 - 272,300= $156,100
It is more profitable to sell the units as-is.
"Sunnyfax Publishing pays out all its earnings and has a share price of $ 38.00. In order to expand, Sunnyfax Publishing decides to cut its dividend from $3.00 to $2.00 per share and reinvest the retained funds. Once the funds are reinvested, they are expected to grow at a rate of 15%. If the reinvestment does not affect Sunnyfax's equity cost of capital, what is the expected share price as a consequence of this decision?"
Answer:
$59.7193
Explanation:
Cost of capital = $3/$38 = 0.0789473
g= 0.33 × 15/100
g = 0.33× 0.15
= 0.04545
P0= $2 / ( 0.0789473 - 0.04545)
= $2/0.03349
$59.7193
a. Calculate the reserve requirement. b. Assume that Rey withdraws $5,000 in cash from her checking account at Solo Bank. i. By how much will Solo Bank’s reserves change based on Rey’s withdrawal? ii. What is the initial effect of the withdrawal on the M1 measure of money supply? Explain. iii. Calculate the new value of excess reserves on the balance sheet of Solo Bank after the withdrawal based on the reserve requirement from part
Answer and Explanation:
(a) Reserve requirement
10%[ RR of $10,000 is 10% of DD of $100,000]
(b)
i All ER [of $5,000] would disappear and they would have only the RR of $10,000.
iiThe M1 MS would not change and the MS
will includes currency and DD of the public.
The $5,000 Luis withdrew [currency] is still M1.
iii When Luis withdrew $5,000, that simply means that RR was now $9,500.
Hence RR will be decrease by $500 and the remainder of the $5,000 withdrawal was taken from excess leaving only 500 currently in ER.
C.They can borrow from another bank which is either from Fed Funds Rate or from the Fed Discount Rate.
On December 31, Strike Company traded in one of its batting cages for another one that has a cost of $538,160. Strike receives a trade-in allowance of $31,185. The old equipment had an initial cost of $231,000 and has accumulated depreciation of $196,350. Depreciation has been recorded up to the end of the year. The difference will be paid in cash. What is the amount of the gain or loss on this transaction?
Answer:
Loss of $3,465
Explanation:
the journal entry to record the exchange should be:
Dr Batting cage - new 538,160
Dr Accumulated depreciation - batting cage old 196,350
Dr Loss on exchange 3,465
Cr Cash 506,975
Cr Batting cage old - 231,000
the carrying value of the old batting cage was = $231,000 - $196,350 = $34,650, but it was exchanged at $31,185, which results in a $3,465 loss (= $34,650 - $31,185).
Lean Accounting The annual budgeted conversion costs for a lean cell are $180,000 for 1,000 production hours. Each unit produced by the cell requires 20 minutes of cell process time. During the month, 600 units are manufactured in the cell. The estimated materials costs are $30 per unit. (Do not round per unit cost. If required, round your answers to the nearest dollar.) Journalize the following entries for the month: a. Materials are purchased to produce 500 units. b. Conversion costs are applied to 600 units of production. c. The cell completes 450 units, which are placed into finished goods. If an amount box does not require an entry, leave it blank.
Answer:
Lean Accounting
General Journal
Sr. No Particulars Debit Credit
1. Materials $ 15000 Dr
Cash (Accounts Payable) $ 15000 Cr
500 units* $30 per unit = $15000
2. Conversion Costs $ 36000 Dr
Work In Process $ 36000Cr
One unit require 20 minutes
600 units require= 600*20= 12000 minutes
There are 60 minutes in 1 hour
12000/60 = 200 hours
600 units require 200 hours
1 hour costs $180
Conversion Costs for 600 units= ($ 180,000/1000)*200= $ 36000
3. Finished Goods 40500 Dr
Work in Process 40500 Cr
Materials for 450 units = $30 * 450= $ 13500
Conversion for 450 units = $ 180 *( 450*20/60) = 150*180= $27000
Total Cost of 450 units completed= $ 13500+ $ 27000= $ 40 500
The principle of comparative advantage asserts that a. the world price of a good will prevail in all countries, regardless of whether those countries allow international trade in that good. b. countries can become better off by specializing in what they do best. c. not all countries can benefit from trade with other countries. d. countries can become better off by exporting goods, but they cannot become better off by importing goods.
Answer:
b. countries can become better off by specializing in what they do best.
Explanation:
Comparative advantage in economics is the ability of an individual or country to produce a specific good or service at a lower opportunity cost better than another individual or country.
The comparative advantage gives a country a stronger sales margin than their competitors as they are able to sell their specific products or render their peculiar services at a lower opportunity cost.
In 1817, David Ricardo who is an english political economist talked about the law of comparative advantage in his book “On the Principles of Political Economy and Taxation."
Also, the principle of comparative advantage asserts that countries can become better off by specializing in what they do best.
This simply means that, any country applying the principle of comparative advantage, would enjoy an increase in output and consequently, a boost in their Gross Domestic Products (GDP).
You are the HR manager at FoodFaire, a local grocery store. Your clerks belong to the United Food and Commercial Workers International Union, which has threatened a strike in 11 days unless their demands are met. They are asking for a 12% raise, and you can offer them only 4%. You can almost feel the hours ticking by—this is a critically important negotiation, and neither party really wants the strike.The _________ conflict-handling technique is most appropriate in this situation.A) avoidingB) compromising C) accommodating D) collaborating E) dominating
Answer:
B) compromising
Explanation:
According to the scenario,
The compromising conflict-handling technique is most appropriate in this situation. As they are asking for a raise of 12%, in this situation HR manager calls the meeting of workers and gives the chance to put their point on their demands. Try to understand their problem and the reason behind their demands. At that point Hr manager wholly examine the situation and try to negotiate with raise of 12% of their demands. So they are ready to do the work with that negotiable price. So this reflects the compromising situation
According to the situation, option (B) compromising conflict-handling technique is correct.
The average price of a gallon of gas in 2015 dropped $0.94 (28 percent) from $3.34 in 2014 (to $2.40 in 2015). Required: 1. Conduct a horizontal analysis by calculating the year-over-year changes in each line item, expressed in dollars and in percentages for the income statement of Insignia Corporation for the year ended December 31, 2015 (amounts in billions). 2-a. Conduct a vertical analysis by expressing each line as a percentage of total revenues. 2-b. Excluding income tax and other operating costs, did Insignia earn more profit per dollar of revenue in 2015 compared to 2014?
Answer and Explanation:
As per the data given in the question,
1)
Insignia Corporation
Income Statements
For the year ended Dec-31
Change in
Particulars 2015 2014 Dollars %
Revenues 126 266 -140 -52.6%
Cost of crude oil and products 63 153 -90 -58.8%
Other operating costs 61 55 6 10.9%
Income before income tax expense 2 58 -56 -96.6%
Income tax expense 0 30 -30 -100.0%
Net income 2 28 -26 -92.9%
2-a)
Insignia Corporation
Income Statements
For the year ended Dec-31
2015 2014
Revenues 126 100.0% 266 100.0%
Cost of crude oil and products 63 50.0% 15.3 57.5%
Other operating costs 61 49.4% 55 20.7%
Income before income tax expense 2 1.6% 58 21.8%
Income tax expense 0 0.0% 30 11.3%
Net income 2 1.6% 28 10.5%
2-b)
No, Insignia earned $0.575 per dollar of revenue in 2015 but it earned only $0.500 per dollar of revenue in 2015.
The horizontal analysis involves comparing each line item of Insignia Corporation's income statement for 2015 with the one from 2014 in dollars and percentage. Vertical analysis is done by expressing each line item as a percentage of total revenues. To assess if Insignia earned more profit per dollar of revenue, compare the net income ratio to total revenues for both years.
Horizontal Analysis
To perform a horizontal analysis of Insignia Corporation's income statement for 2015, you would compare each line item to the equivalent line item from 2014. The change in dollars is found by subtracting the 2014 amount from the 2015 amount. The percentage change is found by dividing the change in dollars by the 2014 amount and multiplying by 100.
Vertical Analysis
In a vertical analysis, each line item on the income statement is expressed as a percentage of total revenues for the same year. To do this, divide the amount of each line item by the total revenues and then multiply by 100.
Whether Insignia earned more profit per dollar of revenue in 2015 compared to 2014 can be determined by comparing the ratios of net income to total revenues for both years.
Understanding Price Determinants
Economists gain a practical understanding of what determines prices and why they change by studying real-world data. Factors affecting gasoline prices, for example, include demand, supply, taxes, and the global oil market.
Place in order the events in the evolution of the Solow growth model. Start by clicking the first item in the sequence or dragging it here The Solow growth model was developed in 1956. The Solow model was applied to many African nations that had just gained independence. Real-world observations caused economists to revisit the Solow growth model. Growth policies failed; nations that had received international aid were no better off.
The Solow growth model, first developed in 1956 and applied to newly independent African countries, encountered setbacks when these nations failed to economically improve despite international aid. The model was revisited, highlighting the importance of the Industrial Revolution and technological advancements for modern economic growth. Countries in East Asia like South Korea, Japan, and China have demonstrated rapid economic growth by employing market-oriented reforms and investing in technology and education.
Explanation:The Solow growth model details the long-term economic growth experienced by different countries. This model, developed in 1956, was first applied to countries in Africa that had recently gained independence. However, despite assistance from international aid, growth policies failed, leaving these nations no better off economically. This caused economists to revisit the Solow economic growth model.
During their revisit, it was found that the Industrial Revolution and subsequent technological advancements were essential drivers of modern economic growth, increasing worker productivity and bolstering trade. This growth has been evidenced within the Western Europe and North American economies which consistently maintained an average growth rate of about 2% per year since the early 19th century.
In the last half-century, other regions, specifically East Asia, showcased their ability to rapidly catch up with the developed countries. Countries like South Korea, Japan, and China utilized market-oriented economic reforms, new technology, education, and substantial capital investment to bolster their economic growth.
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_____ are designed to draw data in real time from various sources, including corporate databases and spreadsheets, so decision makers can make use of up-to-the-minute data. Select one: a. Tactical dashboards b. Operational dashboards c. Strategic dashboards d. Analytical dashboards
Answer: (B) Operational dashboard
Explanation:
The operational dashboard is one of the type of reporting device which is typically used to monitoring the various types of business process and tracking the performance or daily progress in an organization that include spreadsheet and the corporate database.
The main purpose of the operational dashboard is to overview and monitoring the database process in an organization on daily basis and the operational database is basically design to draw the information in real time with the helps of different types of sources.
The main advantage of the operational database is that it helps in making effective decisions in an organization. Therefore, Operational dashboard is the correct answer.
Dapple Company incurred the following costs while producing 480 units: direct materials, $ 13 per unit; direct labor, $ 26 per unit; variable manufacturing overhead, $ 16 per unit; total fixed manufacturing overhead costs, $ 7 comma 680; variable selling and administrative costs, $ 2 per unit; total fixed selling and administrative costs, $ 4 comma 320. There are no beginning inventories. What is the operating income using variable costing if 430 units are sold for $ 160 each?
Answer:
Operating Income $32290
Explanation:
The difference between the variable and absorption costing is that the fixed costs are treated as period costs in variable costing and as product costs in absorptioon costing. In variable costing all variable costs are treated as product costs.
Dapple Company
Income Statement
Variable Costing
Sales 430 units* $ 160 $ 68,800
Less
Variable Cost OF Goods Sold ( 23650)
Direct materials, $ 13 per unit * 430 5590
Direct labor, $ 26 per unit *430 11180
Variable Manufacturing
Overhead, $ 16 per unit *430 6880
Less
Variable selling and
Administrative costs, $ 2 per unit *430 (860)
Contribution Margin 44290
Less
Total Fixed Manufacturing overhead costs, $ 7, 680;
Total Fixed selling and administrative costs, $ 4,320
Operating Income $32290
The operating income using variable costing is calculated as the contribution margin ($44,290) minus the total fixed costs ($12,000), resulting in an operating income of $32,290.
To calculate the operating income using variable costing, we first need to determine the total variable costs at the production level and then calculate the contribution margin from the sales of 430 units. Next, we subtract the total fixed manufacturing and selling costs from the total contribution margin to find the operating income.
Total variable costs per unit = Direct materials + Direct labor + Variable manufacturing overhead + Variable selling and administrative costs
Total variable costs per unit = $13 + $26 + $16 + $2
Total variable costs per unit = $57
Total variable production costs for 480 units = $57 * 480
Total variable production costs for 480 units = $27,360
Sales revenue = $160 * 430
Sales revenue = $68,800
Total variable costs for units sold = $57 * 430
Total variable costs for units sold = $24,510
Contribution margin = Sales revenue - Total variable costs for units sold
Contribution margin = $68,800 - $24,510
Contribution margin = $44,290
Total fixed costs = Fixed manufacturing overhead + Fixed selling and administrative costs
Total fixed costs = $7,680 + $4,320
Total fixed costs = $12,000
Operating income = Contribution margin - Total fixed costs
Operating income = $44,290 - $12,000
Operating income = $32,290
The operating income using variable costing is $32,290.
Coronado Company borrowed $1,018,620 on March 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 5-year, $2,005,300 note payable and an 11%, 4-year, $3,444,000 note payable. Compute the weighted-average interest rate used for interest capitalization purposes. (Round answer to 2 decimal places, e.g. 7.58%.)
Answer:
weighted-average interest rate =10.8%
Explanation:
The weighted average interest rate is the average interest rate of all of the Notes weighted using the nominal value of the notes.
Total nominal value = 1,018,620 + 2,005,300 + $3,444,000 = 6,467,920.
Weighted average interest rate
= (1,018,620× 12%) + (10%×2,005,300)+(11%×3,444,000 )/6,467,920.
= 10.8%
weighted-average interest rate =10.8%
ABC Inc. hires you as its Ethics Officer, and the CEO of ABC Inc wants you to help ABC Inc become ESG compliant. She asks you to make two recommendations each for the Environmental, Social, and Governance components of the ESG report for ABC Inc. She is keen on not repeating Enron’s mistakes, and also wants you to point out how your recommendations will ensure that ABC Inc will function differently from Enron
Answer:
The definition of the problem is listed throughout the section below on explanations.
Explanation:
ABC Inc employs ABC Inc as an internal auditor as well as CEO into becoming compliant with ESG. She requests you should consider 2 recommendations each for ABC Inc's ESG research on Climate, Economic, and Governance. Why your advice will ensure ABC Inc operates differently against Enron.
Environment:
Through its operational activities, ABC should incorporate renewable energy. Solar panels could be used for generating power in organizations where appropriate.ABC will devote 5% of all its sales to research for environmentally friendly energy resources to significantly reduce its reliance on coal.Social:
ABC could perhaps recognize the perspective including its investors and therefore should share the required info.When the CEO is unaware of the corporation's misconduct as well as some informant points something out to herself, therefore that individual or organization must be tended to or respected.Governance:
ABC ought to be more open concerning its activities. If it's the founder or the worker. Stockholders ought to learn what the internal operations of their business are.Boards must be supervised closely and they should include separate, representative members. Their pay should not have been so strong that incongruity is prevented in conferences.As contrasted with Enron's. Enron did not follow up on such above compliance issues.
We were vague when it came to disclosing their liabilities off the income statement. Shareholders were unfamiliar with the firm's operations.Whistle-blower or anybody who referred out such a program flaw was embarrassed and disciplined.ABC Inc may obey these guidelines above to have been consistent with ESG.
The Really Reliable Company produces roller bearings used in a high-wear application in diesel locomotives. The exponentially distributed mean time to failure for these roller bearings has been determined to be 10,000 hours of operation. Really Reliable wants to determine an appropriate warranty period (in hours) such that it will have to provide warranty service for no more than 0.04% of the roller bearings it produces.
Answer:
Appropriate warranty period = 4 hours
Explanation:
According to the scenario, computation of the given data are as follows:
Here, mean = 10,000 = 1/λ
Let appropriate warranty period = t
Hence, 0.0004 = 1-e^-λt
0.0004 = 1-e^(t/10,000)
e^(t/10,000) = 0.9996
Taking ln on both the sides and then solving,
t/10,000 = 0.0004
t = 4 hours
Hence, Appropriate warranty period = 4 hours
The student's question involves applying statistical principles to practical problems, such as deciding on warranty periods based on exponential distribution, testing claims with hypothesis testing, and calculating service times with normal distributions.
The student's question pertains to the determination of an appropriate warranty period for roller bearings produced by The Really Reliable Company, given that the mean time to failure is 10,000 hours and they wish to limit warranty services to 0.04% of produced units. This problem involves the use of exponential distribution and probability to find the time at which the cumulative distribution function (CDF) is equal to 99.96%, corresponding to the 0.04% failure rate allowed under warranty.
To address the tire claim study, a hypothesis testing will be employed using the standard deviation and mean from both the past studies and recent survey to decide if the data significantly contradict the claim.
Regarding the preventive maintenance for air conditioners, with an average service time of one hour and a standard deviation of one hour, the probability that the service time will be less than 1.1 hours needs to be calculated using a normal distribution. The result will help determine if 1.1 hours per technician is a sufficient average budgeted time to service each unit.
The CEO of a heavy equipment manufacturing company suspects that a member of the company’s senior staff has been selling confidential information to a competitor. When asked to take a polygraph test by the CEO, the senior staff member becomes visibly upset and refuses to take the test. Which of the following is true of the given scenario? a. The CEO can fire the senior staff member for refusing to take the polygraph test. b. The senior staff member can face legal charges for refusing to take the polygraph test. c. The senior staff member cannot be fired for refusing to take the polygraph test. d. The senior staff member can sue the firm for illegally attempting to conduct the polygraph test.
Answer: c. The senior staff member cannot be fired for refusing to take the polygraph test.
Explanation: For refusing to take a polygraph test on the grounds of selling confidential business information to a competitor, the senior staff member cannot be fired. Under the Employee Polygraph Protection Act (EPPA) of 1988, private employers are prohibited from administering polygraph tests to their employees, to request results from the polygraph test, and also to or discharge, discipline, or discriminate against them for refusing to take the test whether for employment purposes or during the course of employment. However, there are exceptions for security firms and employees of the federal, state or local government agencies.
For purposes of allocating joint costs to joint products, the estimated net realizable value at split-off is equal to A. final sales price reduced by cost to complete after split-off. B. sales price less a normal profit margin at the point of sale C. separable product cost plus a normal profit margin. D. total sales value less joint costs at point of split-off.
Answer:
A. Final sales price reduced by cost to complete after split-off.
Explanation:
Net realizable value (NRV) is explained here to be the value of an asset that can be realized upon the sale of the asset, less a reasonable estimate of the costs associated with the eventual sale or disposal of the asset. It is a common method used to evaluate an asset's value for inventory accounting. NRV is a valuation method used in both Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS).
Many business transactions allow for judgment or discretion when choosing an accounting method.
A conservative approach means that the accountant should use the accounting method that generates less profit and does not overstate the value of assets.
The board of directors of Testa Incorporated has decided that they would like to declare a $400,000 cash dividend at some point in the near future. The company currently has Retained Earnings of $2,419,000 and a Cash balance of $827,000. They also have current liabilities totaling $436,000. What is missing in order for Testa to be able to pay a cash dividend
Tesla is unable to pay a cash dividend because they have the serious problem of not having B : a healthy cash reserve
In order to pay dividends, a company needs to have a healthy cash reserve from which the dividends can be paid.
Tesla cash reserve:
= Cash balance - Current liabilities
= 827,000 - 436,000
= $391,000
This amount is less than the dividend amount of $400,000 which means that Tesla does not have a healthy cash reserve to pay dividends.
Options for this question include:
A : approval of the executives
B : a healthy cash reserve
C : approval of the investors
D : adequate Retained Earnings
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Gorberchev Food Processing expects to have 28,000 units of finished goods inventory on hand on March 31 and reports the following expected sales (in units) for the months of April through July: April 128,000 May 138,000 June 155,000 July 128,000 At the end of each month the company desires its ending finished goods inventory to be 25% of the next month's projected sales (in units). The budgeted production (in units) for Gorberchev Food Processing for May should be:
Answer:
Total production= 142,250
Explanation:
Giving the following information:
Sales (in units):
May=138,000
June= 155,000
At the end of each month the company desires its ending finished goods inventory to be 25% of the next month's projected sales (in units).
To calculate the units to be produced in May, we need to use the following formula:
Production= sales + desired ending inventory - beginning inventory
Budgeted production:
Sales= 138,000
Desired ending inventory= (155,000*0.25)= 38,750
Beginning inventory= (138,000*0.25)= (34,500)
Total production= 142,250
Each of the following statements may (or may not) describe one of these technical terms. In the space provided below each statement, indicate the accounting term described, or answer "None" if the statement does not correctly describe any of the terms. ________ (a.) An expenditure that will benefit only the current accounting period. ________ b.) The accelerated depreciation system used in federal income tax returns for depreciable assets purchased after 1986. ________ c.) A policy that fractional-period depreciation on assets acquired or sold during the period should be computed to the nearest month. ________ d.) An intangible asset representing the present value of future earnings in excess of normal return on net identifiable assets. ________ e.) Expenditures that could lead to the introduction of new products, but which, according to the FASB, should be viewed as an expense when incurred. ________ f.) Depreciation methods that take less depreciation in the early years of an asset's useful life, and more depreciation in the later years. ________ g.) An account showing the portion of the cost of a plant asset that has been written off to date as depreciation expense
Answer: Please find below the answer. You omitted the terms to be used.
Explanation: Using the accounting terms, Revenue expenditure. straight line policy, Goodwill,capital expenditure, half year convention, accelerated depreciation, research and development, MACRS,
filling in the terms appropriately, or None, if statement does not describe any term, we have
a)An Expenditure that will benefit only the current accounting period - Revenue expenditure
b) The accelerated depreciation system used in federal income tax returns for depreciable assets purchased after 1986 - MACRS
c) A policy that fractional period depreciation on assets acquired or sold during the period should be computed to the nearest month - Straight Line policy
d) An intangible asset representing the present value of future earnings in excess of normal return on net identifiable asset - Goodwill
e) Expenditures that could lead to introduction of new products, but which according to FASB, should be viewed as an expense when incurred - Research and Development
f-)Depreciation method that takes less depreciation in early years of an asset's useful life, and more depreciation in later years - NONE
g) An account showing that portion of the cost of a plant asset that has been written off to date as depreciation expense - Accumulated Depreciation.
What group is primarily responsible for the creation of International Financial Reporting Standards (IFRS)?
a. International Forum on Accountancy Development (IFAD)
b. International Accounting Standards Board (IASB)
c. International Federation of Accountants (IFA)
d. Financial Accounting Standards Board (FASB)
Answer:
The correct answer is Option B.
Explanation:
International Accounting Standards Board (IASB) was established in 2001 to replace the International Accounting Standards Committee. It is a private-sector and independent body that approves and develops International Financial Reporting Standards (IFRS). IFRS is an accounting standard that tends to uniform the financial reporting standards across different organizations across different countries. The IASB also makes pronouncement on new and emerging IFRS standards.
Western Company is preparing a cash budget for June. The company has $10,600 in cash at the beginning of June and anticipates $31,400 in cash receipts and $37,300 in cash payments during June. Western Company has an agreement with its bank to maintain a minimum cash balance of $10,000. As of May 31, the company has no loans outstanding. To maintain the $10,000 required balance, during June the company must:
a. Borrow $5,300.
b. Repay $4,900.
c. Borrow $10,000.
d. Repay $5,100.
e. Borrow $4,900.
Answer:
$5,300
Explanation:
The computation of maintained balance is shown below:-
Total amount = Opening Balance + Cash Receipts - Cash Disbursement
= $10,600 + $31,400 - $37,300
= $42,000 - $37,300
= $4,700
In order to maintain a balance of $10,000, it needs to borrow = $10,000 - $4,700
= $5,300
Therefore to maintain a balance of $10,000, it needs to borrow $5,300
Samuel slips on an icy spot in front of an apartment and is hospitalized for three weeks. The owner of the apartment pays Samuel $14,000 for medical expenses and gives him $4,000 for his pain and suffering. Samuel receives his regular $1,800 salary from his employer while he couldn't work and also receives $7,000 in disability pay from a plan that he had purchased. Samuel's gross income from these payments is: a. $-0-. b. $1,800. c. $2,500. d. $5,800. e. $8,800.
Answer:
B) $1,800.
Explanation:
$14,000 in medical expenses are not part of Samuel's gross income.
$7,000 in disability payments are not included in Samuel's gross income because he paid the premiums.
$4,000 in pain and suffering compensation are not part of your gross income.
The only payments that are part of Samuel's gross income and therefore are taxed, are his regular monthly salary payments = $1,800. If Samuel's disability insurance premium had been paid by his employer, then the $7,000 would have been taxable.
The Nearside Co. just paid a dividend of $1.20 per share on its stock. The dividends are expected to grow at a constant rate of 4 percent per year, indefinitely. Investors require a return of 10 percent on the stock. a. What is the current price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What will the price be in three years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. What will the price be in 10 years? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Answer and Explanation:
The computation is shown below:
a. Current price is
= D1 ÷ (Required return - Growth rate)
= ($1.20 × 1.04 ÷ (0.1 - 0.04)
= $20.8
b. Now the price in three year is
P3 = Current price × (1 + Growth Rate)^3
= $20.8 × (1.04)^3
= $23.40
c. For price in 10 year it is
P10 = Current price × (1 + Growth Rate)^10
= $20.80 × (1.04)^10
= $30.79
We simply applied the above formula
Final answer:
Explanation of current stock price using dividend discount model, calculations for price in three and ten years.
Explanation:
The current price of the stock can be calculated using the dividend discount model. The formula to find the current price of a stock using DDM is P = D / (R - G), where P is the current price, D is the dividend paid per share, R is the required return rate, and G is the dividend growth rate.
a. Current price = $1.20 / (0.10 - 0.04) = $20.00
b. To find the price in three years, you can use the formula P3 = D3 / (R - G), where D3 is the dividend in three years. Calculate D3 first: D3 = $1.20 * (1 + 0.04) ³ = $1.20 * 1.04 ^ 3 = $1.2990 (approx).
Now calculate the price in three years: P3 = $1.2990 / (0.10 - 0.04) = $21.65
c.The price in ten years can be found using the formula P10 = D10 / (R - G), where D10 is the dividend in ten years. Calculate D10 first using the growth rate: D10 = $1.20 * (1 + 0.04) ¹⁰ = $1.20 * 1.04¹⁰ = $2.0498 (approx).
Now find the price in ten years: P10 = $2.0498 / (0.10 - 0.04) = $34.16
LPM Ltd. uses units produced as its measure of activity. During August, the company budgeted for 46,700 units of output, but actually produced 48,900 units of output. The company uses the following revenue and cost formulas in its budgeting, where q is the number of units of output:
Revenue: $10.40q
Salaries: $31,050 + $2.45q
Supplies: $1.25q
Utilities: $0.60q
Insurance: $23,090
Miscellaneous expenses: $13,800 + $0.21q
The company reported the following actual results for August:
Revenue $ 491,250
Salaries $ 148,360
Supplies $ 55,795
Utilities $ 31,920
Insurance $ 22,100
Miscellaneous expense $ 20,845
The revenue variance in August is:
Answer:
The revenue variance in August is $5,570 favorable.
Explanation:
LPM Ltd.
Actual Revenue = $491,250
Budgeted Revenue = $10.40 x 46,700 units = $485,680
Revenue Variance = Budgeted Variance - Actual Variance
Revenue Variance = $485,680 - $491,250
Revenue Variance = $5,570 favorable
Since the Actual Variance is greater than budgeted variance, hence favorable revenue variance.
On September 1, 2021, Southwest Airlines borrows $39.4 million, of which $6.8 million is due next year. Show how Southwest Airlines would record the $39.4 million debt on its December 31, 2021, balance sheet. (Enter your answers in dollars, not millions. For example, $5.5 million should be entered as 5,500,000.)
Is there a long term liability?
Answer:
$32,600,000
Explanation:
The presentation of the liabilities section is presented below:
Balance sheet
Current liability
Current portion of long term debt $6,800,000
Long term liability
notes payable $32,600,000
Total liabilities $39,400,000
By this presentation, there is a long term liability of $32,600,000
Alpha Company makes all its sales on account. The accounts receivable payment experience is as follows: Percent paid in the month of sale 35% Percent paid in the month after the sale 54% Percent paid in the second month after the sale 6% Alpha provided the following information on sales: May $150,000 June $125,000 July $136,000 August (expected) $142,000 How much of June's credit sales is expected to be collected in the month of July
Answer:
$67,500
Explanation:
Data provided as per the requirement of expected cash collection in July is shown below:-
June sales = $125,000
Percent paid in the month after the sale = 54%
The computation of expected cash collection in July is shown below:-
Expected cash collection in July = June sales × Percent paid in the month after the sale
= $125,000 × 54%
= $67,500
Therefore for computing the expected cash collection in July we simply applied the above formula.
First Niles Financial, Inc., is a company whose sole business is to own and operate a bank, Home Federal Savings and Loan Association of Niles, Ohio. First Niles's directors included bank officers William Stephens, Daniel Csontos, and Lawrence Safarek; James Kramer, president of an air-conditioning company that serviced the bank; and Ralph Zuzolo, whose law firm served the bank and whose title company participated in most of its real estate deals. First Niles's board put the bank up for sale and received three bids. Farmers National Bank Corp. stated that it would not retain the board. Cortland Bancorp indicated that it would terminate the directors but consider them for future service. First Financial Corp. said nothing about the directors. The board did not pursue Farmers' offer, failed to timely respond to Cortland's request, and rejected First Financial's bid. Leonard Gantler and other First Niles shareholders filed a suit in a Delaware state court against Stephens and the others. What duties do directors and officers owe to a corporation and its shareholders
Answer: Please refer to Explanation
Explanation:
The Directors and Officers of a Corporation owe to a Corporation and it's shareholders various duties such as Loyalty, Prudence, Care and Fair Dealing.
They are to act in the interest of the shareholders at all times which means their own personal interest should be put behind that of the shareholders as they work to maximise shareholder wealth.
If it is proven that the Directors and Officers of First Niles analysed the bids on the bank based on their personal interests namely, the keeping of their position as board members, and therefore rejected these bids based on the unwillingness of the bidding companies to keep them as Board members, then that constitutes a Breach of the duties expected of them.
Directors and officers owe fiduciary duties to a corporation and its shareholders, including the duty of care and the duty of loyalty. These duties require them to act in the best interests of the company and its shareholders and to avoid conflicts of interest. Failure to fulfill these duties may result in legal consequences.
Explanation:Directors and officers owe fiduciary duties to a corporation and its shareholders. These duties include the duty of care and the duty of loyalty. The duty of care requires directors and officers to act with the level of care that a reasonably prudent person would use in similar circumstances. The duty of loyalty requires directors and officers to act in the best interests of the corporation and its shareholders, and to avoid conflicts of interest.
For example, in the case of First Niles Financial, Inc., the directors had a duty to consider the best interests of the company and its shareholders when deciding whether to pursue the bids for the bank. Failing to properly respond to the bids and rejecting offers without considering the potential benefits to the shareholders could be seen as a breach of their duties.
Shareholders who believe that directors and officers have breached their fiduciary duties can file a lawsuit against them. In the case of First Niles, Leonard Gantler and other shareholders filed a suit against the directors. If a court determines that the directors breached their duties, they may be held personally liable for any damages caused to the company and its shareholders.