Answer:
The journal entries are as follows:
(a) On July 16,
Account receivable A/c Dr. $1,200
To sales revenue $1,200
(To record Sales)
Cost of goods sold A/c Dr. $720
To Inventory $720
(To record cost of goods sold)
(b) On July 19,
Sales return and allowance a/c Dr. $200
To Account receivable $200
(To record sales return)
Inventory A/c Dr. $120
To Cost of goods sold $120
(To record cost of goods return)
(c) On July 22,
Cash (1,000 × 98%) A/c Dr. $980
Sales discount A/c Dr. $20
To Account receivable $1,000
(To record amount received)
Final answer:
A detailed explanation of recording journal entries for sales, returns, and customer payment in a perpetual inventory system for Kate Company.
Explanation:
Journal Entries for Kate Company:
July 16: Debit Accounts Receivable $1,200, Credit Sales $1,200. Debit Cost of Goods Sold $720, Credit Inventory $720.July 19: Debit Sales Returns and Allowances $200, Credit Accounts Receivable $200. Debit Inventory $120, Credit Cost of Goods Sold $120.July 22: Debit Cash $1,176 ($1,200 - $24 discount), Credit Accounts Receivable $1,200, Debit Sales Discount $24.Allowing firms to estimate rather than physically count inventory at interim (quarterly)periods is an example of a trade-off between___________.
a. verifiability and faithful representation.b. faithful representation and comparability.c. timeliness and verifiability.d. neutrality and consistency.
Answer:
The correct answer is (c)
Explanation:
The inventory management is an important task to avoid shortages against the demand. The physical count of inventory is hard and time taking which is why companies usually estimate the inventory rather than spending time to count it. This is the perfect example of a trade-off between timeliness and verifiability. It is a good trade-off because companies usually know the inventory levels.
An energy company is seeking to build a pipeline across multiple Canadian provinces and U.S. states. Though __________________ managers identify the people interested in the company's activities and prioritize them by their impact on and interest in the pipeline project.
Answer:
The correct word for the blank space is: stakeholder mapping.
Explanation:
Stakeholder mapping is the act by which companies look for investors so they can finance their projects. The mapping allows entrepreneurs to verify if their project plan is good enough to attract capital and the process also helps to identify who of those investors are serious in making the plan become a reality.
Universal Containers has successfully implemented a large Service Cloud rollout for their national call center 3 months ago.
true/false
Answer:
True.
Explanation:
Universal Container has implemented a large service cloud roll out almost 3 months ago at their national call center successfully, but agents are having trouble to open the cases for united automotive whenever they try to create a new case. There were more than 15000 open cases but the problem appears again.
Journalize the entries to record the following selected bond investment transactions for Starks Products: If an amount box does not require an entry, leave it blank. a. Purchased for cash $66,000 of Iceline, Inc. 9% bonds at 100 plus accrued interest of $990
Answer:
The journal entries are:
Dr Bond Receivable 66,000
Dr Interest Receivable 990
Cr Cash 66,990
(to record the purchase of Iceline, Inc. 's bonds)
Explanation:
The purchase include the following deliverables:
+ The bond at the price of $66,000
+ The interest receivables that the seller(s) is/are eligible to receive, yet, they transfer the rights to the buyers. This amount is recorded at $990 as Buyer's receivable because as bond holder, Buyers are eligible to receive that. Noted that this is not qualified to be recorded as Interest Income for Bond's Buyers because the Buyers do not hold the bond at all before the purchase, thus, they should not recorded any interest income from the coupon receipt.
=> Total Cash spent for the purchase is $66,990 ( $66,000 + $990).
Match the various information flows to the smart TV purchase steps. Store to Manufacturer Buyer to Manufacturer Manufacturer to Distribution Center and Buyer Store to Distribution Center Customer to Store Store to Buyer Match each of the options above to the items below Smart TV purchased POS terminal sends data Corporate inventory order Frequent, direct reorder Request delivery schedule Advanced shipping notice
Final answer:
The discussion revolves around tying sales, a controversial sales tactic requiring customers to buy a second, potentially unwanted product with their initial purchase. It also touches on the historical shift to department stores, which altered consumer habits and retail experiences significantly.
Explanation:
The subject in question pertains to tying sales, a business practice where a customer is permitted to buy one product only on the condition that they also purchase another item. These kinds of sales are considered controversial because they may force consumers to buy an additional product they may not need or desire, potentially lacking any real benefit to them. For example, if a customer wishes to buy a popular DVD but is mandated to also purchase a specific portable TV model, this practice restricts consumer choice and does not allow customers to select from a wide market range, thus conflicting with the notion of free market principles.
Another aspect of the business that is highlighted is the historic shift in consumerism with the rise of department stores. The evolution from small, family-run shops to large department stores signified a change towards modern shopping habits, including fixed pricing and the spread of advertising, alongside the availability of a broad array of goods.
On July 8, Action Co. issued a $70,000, 6%, 120-day note payable to Scanlon Co. Assuming a 360-day year, what information is needed to calculate the maturity value of the note? a.The interest rate (6%) and the term (120 days) are needed to calculate the maturity value of the note. b.The face value of the note ($70,000) is needed to calculate the maturity value of the note. c.The face value ($70,000), interest rate (6%), and term (120 days) are needed to calculate the maturity value of the note. d.None of the information given is needed to calculate the maturity value of the note.
Answer:
c.The face value ($70,000), interest rate (6%), and term (120 days) are needed to calculate the maturity value of the note.
Explanation:
maturity value = face value + interest
interest = face value*interest rate*period
= $70,000*6%*120/360
= 1400
face value = 70,000
maturity value = 70,000 + 1400
= 71400
Therefore, face value and interest rates needed to calculate the maturity value of the rate.
Final answer:
To determine the maturity value of Action Co.'s note, the face value of $70,000, the interest rate of 6%, and the 120-day term are required. Ensuing the calculation, the interest amounts to $1,400, leading to a maturity value of $71,400.
Explanation:
To calculate the maturity value of a note, we need to take into account several components, including the face value, the interest rate, and the term of the note. In the case of Action Co.'s note payable to Scanlon Co., the face value is $70,000, the annual interest rate is 6%, and the note's term is 120 days. Using these variables, we can compute the interest of the note and add it to its face value to arrive at the maturity value.
The interest can be calculated as follows:
Interest = (Face Value imes Interest Rate imes Term) / (360-day year)
Interest = ($70,000 imes 6% imes 120) / 360
Interest = ($70,000 imes 0.06 imes 120) / 360
Interest = $1,400
Add the interest to the face value to get the maturity value:
Maturity Value = Face Value + Interest
Maturity Value = $70,000 + $1,400
Maturity Value = $71,400
Thus, we will need option c: The face value ($70,000), interest rate (6%), and term (120 days) are needed to calculate the maturity value of the note.
Which level of PPE uses APR/PAPR and also includes a chemical/splash over garment, double gloves and chemical resistant boots?
Level B of PPE usage includes the use of APR or PAPR, a chemical/splash overgarment, double gloves, and chemical-resistant boots. It is often used in situations involving hazardous materials.
Explanation:The level of Personal Protective Equipment (PPE) that uses Air-Purifying Respirators (APR) or Powered Air-Purifying Respirators (PAPR), and includes a chemical/splash overgarment, double gloves, and chemical-resistant boots is Level B protection. This level is utilized when the type of airborne substance is known, and measurable but requires a high level of respiratory protection but less skin protection. This level of protection is commonly used during situations involving hazardous materials, such as dealing with spills of chemical substances.
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Total production costs for Gallop, Inc., are budgeted at $230,000 for 50,000 units of budgeted output and at $280,000 for 60,000 units of budgeted output. Because of the need for additional facilities, budgeted fixed costs for 60,000 units are 25% more than budgeted fixed costs for 50,000 units. How much is Gallop's budgeted variable cost per unit of output?
Answer:
$3
Explanation:
We have to use linear function to determine the variable cost per unit.
Let, x = fixed costs, y = variable cost per unit
According to the question,
x + 50,000 y = $230,000 ........ (i)
As the fixed cost increases 25% due to additional facilities, the new equation will be -
(x*25%) + x + 60,000 y = $280,000
or, 0.25x + x + 60,000 y = $280,000
or, 1.25 x + 60,000 y = $280,000 ......... (ii)
Multiplying the equation (i) by 1.25 and the equation (ii) by 1, we can get,
1.25x + 62,500 y = $287,500 ...... (iii)
1.25x + 60,000 y = $280,000 ......(iv)
Subtracting equation (iv) from (iii), we can get,
2,500 y = $7,500
or, y = $7,500 ÷ 2,500
or, y = $3
Therefore, the budgeted variable cost per unit = $3
To calculate Gallop's budgeted variable cost per unit, you have to solve simultaneous equations based on the given total costs for different production levels, taking into consideration that fixed costs are higher by 25% for the larger production batch.
Explanation:To find Gallop's budgeted variable cost per unit of output, we must first understand that total costs consist of fixed costs and variable costs. As per the information given, the budgeted fixed costs for 60,000 units are 25% more than those for 50,000 units. Therefore, if we denote the budgeted fixed costs for 50,000 units as F, then the budgeted fixed costs for 60,000 units are 1.25F.
Using this information and the total budgeted costs given for both levels of production, we can set up two equations:
For 50,000 units: Total costs = Fixed costs (F) + Variable costs (50,000 units * Variable cost per unit (V)) = $230,000For 60,000 units: Total costs = Fixed costs (1.25F) + Variable costs (60,000 units * V) = $280,000Now, we can solve these two simultaneous equations to find V, the variable cost per unit. By doing some algebra (subtracting the first equation from the second) the increase in total cost ($50,000 = $280,000 - $230,000) is mainly due to the additional 10,000 units and the 25% increase in fixed costs. Once we find the increased fixed cost, we can subtract it from the $50,000 to find the total variable cost for the additional 10,000 units, and dividing this number by 10,000 gives us the variable cost per unit.
Each of the following is correct regarding treasury stock except that it has been
a. retired.
b. issued.
c. reacquired.
d. fully paid for.
Final answer:
Treasury stock refers to the shares of a company's own stock that it has bought back from shareholders. It is not actively traded and is considered retired. It is reacquired by the company and fully paid for.
Explanation:
Treasury stock refers to the shares of a company's own stock that it has bought back from shareholders. Each of the following statements is correct regarding treasury stock except that it has been issued. Treasury stock is not actively traded and is considered retired. It is reacquired by the company and fully paid for.
The correct answer is that treasury stock has not necessarily been retired. Unlike retired shares, treasury stock consists of shares that have been issued and fully paid for, which are then reacquired by the company and held in its treasury. These shares can be reissued, sold, or retired at a later date, depending on the company's decision. Treasury stock reduces shareholders' equity and does not pay dividends or have voting rights while held by the company.
Entrepreneurial endeavors consist of new business venturing, innovativeness, self-renewal, and reactiveness. a. True b. False
Answer:
Entrepreneurial endeavors consist of new business venturing, innovativeness, self-renewal, and reactiveness
True
Explanation:
Entrepreneur entails when one is his/her own boss, he or she determines the time, mode of running the business,innovations, capital, creativity, packaging, branding among others.
Inventories Raw materials $ 43,000 $ 52,000
Work in process 10,200 21,300
Finished goods 63,000 35,600
Activities and information for May
Raw materials purchases (paid with cash) 210,000
Factory payroll (paid with cash) 345,000
Factory overhead Indirect materials 15,000
Indirect labor 80,000
Other overhead costs 120,000
Sales (received in cash) 1,400,000
Predetermined overhead rate based on direct labor cost 70 % Determine whether there is over or underapplied overhead. Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold.
Answer:
Explanation:
Overhead:
Indirect materials 15,000.00
Indirect labor 80,000.00
Other overhead costs 120,000.00
If we sum up everything = 215,000.00
Overhead applied 185,500.00
Underapplied OH 215000-185500=29,500.00
Billy’s Exterminators, Inc., has sales of $749,000, costs of $306,000, depreciation expense of $58,000, interest expense of $39,000, a tax rate of 35 percent, and paid out $73,000 in cash dividends. The firm has 100,000 shares of common stock outstanding.
What is the earnings per share?
What is the dividends per share?
Answer:
Earnings per share = $2.25
Dividend per share = $0.73
Explanation:
given data
sales = $749,000
costs = $306,000
depreciation expense = $58,000
interest expense = $39,000
tax rate = 35 percent
paid out dividends = $73,000
no of share = 100,000
solution
first we get here Net income that is
Net income = Profit before tax (PBT) - Tax .........1
EBIT = sales - costs - depreciation expense
EBIT = $749,000 - $306,000 - $58,000
EBIT = $385,000
and
Profit before tax = EBIT - interest = $385,000 - $39,000 = $346,000
tax is = 35 % of Profit before tax
tax = 35% of $346,000 = $121,100
so
Net income = $346,000 - $121,100
Net income = 224,900
and
Earnings per share will be here as
Earnings per share = Net income ÷ Number of shares ..................2
Earnings per share = [tex]\frac{224900}{100000}[/tex]
Earnings per share = $2.25
and
Dividend per share will be here as
Dividend per share = Cash dividends ÷ Number of shares .....................3
Dividend per share = [tex]\frac{73000}{100000}[/tex]
Dividend per share = $0.73
Adjustments for ________ would not be included in the required reconciliation of the Governmental Fund Balance Sheet to the governmental activities Statement of Net Position.
Answer:
Adjustments for enterprise fund-basis statements from their original modified accrual basis would not be included in the required reconciliation of the Governmental Fund Balance Sheet to the governmental activities Statement of Net Position.
A limited liability company:
a. can only have a single owner.
b. is comprised of limited partners only.
c. is taxed similar to a partnership.
d. is taxed similar to a C corporation.
e. generates totally tax-free income.
Answer:it's C or D
Explanation:
What are some of the major economic reform themes that are common to the three international organizations promoting globalization?a.The primary role of these institutions was to rebuild the broken world financial and trade systems that could help lead to global peace and prosperity.
Final answer:
Major economic reform themes in globalization promoted by the World Bank, IMF, and WTO include market-oriented economic reforms, human capital development through investments in health and education, managing international financial flows, and the challenge of sustaining economic growth rates.
Explanation:
The ongoing process of globalization has been facilitated by several major economic reforms, promoted by international organizations like the World Bank, the International Monetary Fund (IMF), and the World Trade Organization (WTO). These reforms are essential to integrating national economies into the international framework, providing guidelines for international trade, finance, and investment.
Market-oriented economic reforms are crucial in this undertaking. They include liberalization of trade to promote exports and imports, deregulation to remove unnecessary barriers for businesses, and privatization to transfer ownership from the public to the private sector. These reforms aim to create a more efficient and competitive economic environment globally.
Additionally, the focus on human capital development through health and education is vital. By investing in the population's skills and well-being, countries can escape poverty traps and sustain growth. Modern technology plays a significant role here, making such investments more feasible than ever before.
However, amidst these reforms, it is important to address the challenges that come with international financial flows. The Asian Financial Crisis illustrated the volatility that can accompany rapid inflows and outflows of capital, raising concerns about trade deficits and economic stability. Careful monitoring and policy frameworks are needed to mitigate these risks.
Lastly, sustaining economic growth rates is a continuous challenge for both developed and developing nations. Striking a balance between integration in the global market and managing domestic economic policies is key to long-term prosperity and resilience.
Crystal owns a bookstore. A period of economic turmoil adds a great deal of uncertainty to her sales forecasts. She decides to hold additional funds in the store's account to guard against the possibility of lower-than-expected sales. This is an example of an increase in Crystal's demand for money.True or false?
Answer:
True
Explanation:
In monetary economics, the demand for money is the total amount of the asset an individual prefer to keep in liquid or near liquid forms rather than investment. Some of the factors that influences the demand for money are interest rate, inflation, income, e.t.c.
John Maynard Keynes postulated that the demand for money falls within the realms of liquidity preference, which he summarized under three headings, these are, the transactions motives, the precautionary motives, and the speculative motives.
A tax refund anticipation loan is a great way to get your refund money now instead of waiting several weeks for the government to send you your check.
True or False?
Answer:
The statement is: False.
Explanation:
Tax Refund Anticipation Loans (RAL) is a loan given by third-party companies dedicated to file tax returns based on the expected tax refund they can receive. Individuals typically receive their tax return refund within some weeks after filing their tax returns. People with immediate money needs can see this as a solution to that problem but may imply big interest payments afterward.
Consider the following financial data from the past year for Midwest Outdoor Equipment Corporation. Gross income $ 25,240,000 Total sales 24,324,000 Total credit sales 18,785,000 Net income 2,975,000 Cost of goods sold 12,600,000 Total assets 10,550,000 Average inventory 2,875,000 Average receivables 3,445,000 a. Compute the receivable turnover ratio.
Answer:
Receivable turnover ratio is 5.4528
Explanation:
Receivable turnover ratio:
It is used to measure how efficiently a company or firm is issuing the credits to its customers and collection g funds from them. It is a measure how assets are used by the company efficiently.
Formula:
Receivable turnover ratio=(Total credit Sales)/ (Average receivables)
[tex]Receivable\ turnover\ ratio=\frac{\$18,785,000}{\$3,445,000} \\Receivable\ turnover\ ratio= 5.4528[/tex]
It is unit less.
Receivable turnover ratio is 5.4528
At the beginning of the year, Sheridan Company had total assets of $845,000 and total liabilities of $600,000. (Treat each item independently.) (a) If total assets increased $177,000 during the year and total liabilities decreased $71,000, what is the amount of stockholders' equity at the end of the year?(b) During the year, total liabilities increased 592,000 and stockholders' equity decreased $72,000. What is the amount of total assets at the end of the year?(c) If total assets decreased $90,000 and stockholders' equity increased $100,000 during the year, what is the amount of total liabilities at the end of the year?
Answer:
A. Stockholders equity at the end is $493,000.
B. Closing total assets is $865,000.
C. Closing liability is $410,000.
Explanation:
A. Closing total assets:
= Opening assets + increase in assets
= $845,000 + $177,000
= $1,022,000
Closing liability:
= Opening liability - Decrease in liability
= $600,000 - $71,000
= $529,000
Closing equity:
= Closing assets - Closing liability
= $1,022,000 - $529,000
= $493,000
B. Opening equity:
= Opening assets - Opening liability
= $845,000 - $600,000
= $245,000
Closing assets:
= Opening assets + increase in liability - Decrease in equity
= $845,000 + $92,000 - $72,000
= $865,000
C. Closing liability:
= Opening liability - decrease in assets - increase in equity
= $600,000 - $90,000 - $100,000
= $410,000
The solutions for the given question can be obtained through the Accounting Equation. The solutions are as follows:
a. Stakeholder's equity = $4,93,000
b. Assets = $13,65,000
c. Liabilities = $4,10,000
What is Accounting Equation?An accounting equation or simply a balance sheet equation represents the relationship between the assets, liabilities, and equity of an entity as:
[tex]\rm Assets = Liabilities + Equity[/tex]
On the basis of the accounting equation, the value of equity at the beginning of the year is:
[tex]\begin{aligned} \rm Assets &= Liabilities + Equity\\$8,45,000 &= $6,00,000 + Equity\\Equity &= $8,45,000 - $6,00,000\\Equity &= $2,45,000\end[/tex]
a. Calculation of the equity when assets increased by $177,000 and liabilities decreased by $71,000:
[tex]\begin{aligned} \rm Assets &= Liabilities + Equity\\\$8,45,000 + \$1,77,000 &= (\$6,00,000 - \$71,000) + Equity\\\$10,22,000 &= \$5,29,000 + Equity\\Equity &= \$10,22,000-\$5,29,000 \\Equity &= \$4,93,000\end[/tex]
The value of equity is $4,93,000.
b. Calculation of assets when total liabilities increased by $592,000 and stockholders' equity decreased by $72,000:
[tex]\rm Assets &= Liabilities + Equity\\Assets = (\$6,00,000 +\$5,92,000) + (\$2,45,000 - \$72.000)\\Assets = \$11,92,000 + \$1,73,000\\Assets = \$13,65,000[/tex]
The value of assets is $13,65,000.
c. Calculation of liabilities when total assets decreased by $90,000 and stockholders' equity increased by $100,000:
[tex]\begin{aligned} \rm Assets &=\rm Liabilities + Equity\\\$8,45,000 -\$90,000 &= \rm Liabilities + (\$2,45,000 + \$1,00,000)\\\$7,55,000 &= \rm Liabilities + \$3,45,000\\\rm Liabilities &= \$7,55,000 - \$3,45,000\\\rm Liabilities &= \$4,10,000\end[/tex]
The value of liabilities is $13,65,000
Therefore the solutions to the problem are $4,93,000, $13,65,000, and $13,65,000.
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Carla Vista Company ended its fiscal year on July 31, 2020. The company’s adjusted trial balance as of the end of its fiscal year is as follows. prepare closing entries
Closing entries involve zeroing out of all Revenue, Expense and Dividend accounts and transferring their balances to Retained Earnings. This sets these accounts to zero for the upcoming fiscal year. An example procedure of closing entries includes closing revenue and expenses accounts to the Income Summary account and then further closing the Income Summary to Retained Earnings.
Explanation:The act of closing entries involves zeroing out all Revenue, Expense, and Dividend accounts and transferring their balances to Retained Earnings at the end of the accounting period. This process resets the Revenue, Expense, and Dividend accounts to zero at the start of the new fiscal year.
Here's an example of how these closing entries might look:
First, we close the revenue accounts to the Income Summary account. The debit from the revenues accounts (which will be on the credit side) are credited to the Income Summary. Second, the expenses are also closed to the Income Summary account. The credits from the expenses (which will be on the debit side) are debited to the Income Summary. Third, we close the Income Summary account to Retained Earnings. If after the first two entries, the balance of the Income Summary account is credit (which means a profit), then this third closing entry will be a debit to Income Summary and a credit to Retained Earnings.Finally, if there are dividends, a closing entry will be established which debits Retained Earnings and credits Dividends.Learn more about Closing Entries here:https://brainly.com/question/33762472
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A Treasury bill has a face value of 100K, 119 days to maturity, and is selling for $90 thousand. What is the effective annual yield on this bill? Enter answer in percents, accurate to two decimal places.
Answer:
Annual Yield = 34.08%
Explanation:
A treasury is a short-term financial instrument issued by a government with a maturity date of 365 days or less. It is issued for a value less than the its face value., therefore it is a discounted instrument.The face value is the amount that the investor will receive at the maturity of the bill.
To calculate the the effective annual yield of a bond; follow the steps below:
Step 1: Calculate the return earned for the investment period. This called the yield for the investment period. Note that the investment may be for less than 365 days depending on the number of days left to maturity when it was purchased.
(Face Value - Price)/Price × 100
= ((100-90)/90)× 100= 11.%
This helps to ascertained the return earned as a percentage of the amount invested.
Step 2: Calculate the annual effective rate. This is required to determine the equivalent return (yield) per annum should the investment be made for one year.
Annualized Yield= (Yield/Time period to maturity) × 365
= (11.11%/119) × 365
= 34.08%
Land was acquired in 2016 for a future building site at a cost of $40,300. The assessed valuation for tax purposes is $28,000, a qualified appraiser placed its value at $50,000, and a recent firm offer for the land was for a cash payment of $44,000. The land should be reported in the financial statements at:
a) $ 28,000.
b) $ 50,000.
c) $ 44,000.
d) $ 40,300.
Answer:
d) $ 40,300.
Explanation:
At the time of recording of the fixed assets, the fixed assets should be recorded at purchase cost or historical price
Since in the question, the land was acquired at $40,300 and the assessed valuation for tax purposes is also done for $28,000 plus there is a qualified appraiser for $50,000 and the cash payment is also made for $44,000
But at the time of reporting, the balance sheet would show at the acquired price i.e $40,300
Prepare an amortization schedule for a five-year loan of $71,500. The interest rate is 7 percent per year, and the loan calls for equal annual payments. (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. Leave no cells blank - be certain to enter "0" wherever required.)
Answer:
Explanation:
Let's recall the formula that will be used for calculations
The annual payment on the loan=Present value of a loan/PVIFA
r=7%; n=5
Annual payment on the loan=71500/4.100197=17438.19
OR we can use the financial calculator and input the following data:
PV = 71500; r=7%; n=5; PMT=?
PMT=17438.19
Amortization schedule:
YEAR Beg. balance Total PMT Interest PMT Principal PMT End. Bal.
1 71500 17438.19 5005 12433.19 59066.81
2 59066.81 17438.19 4134.68 13303.51 45763.3
3 45763.30 17438.19 3203.43 14234.76 31528.54
4 31528.54 17438.19 2207 15231.19 16297.35
5 16297.35 17438.19 1140.81 16297.38 0
*5005 = 71500 ×0.07
12433.19=17438.19-5005 and so on...
Final answer:
To prepare an amortization schedule for a five-year loan of $71,500 at a 7% annual interest rate, you must calculate the annual payment using the present value of annuity formula, then distribute each payment into principal and interest, updating the loan balance each year.
Explanation:
The amortization schedule for a five-year loan of $71,500 with a 7 percent annual interest rate and equal annual payments requires the calculation of the annual payment amount using the formula for an annuity. Once the annual payment is calculated, the schedule will track the decreasing balance over time as each payment is made. To find the annual payment, we would use the present value of annuity formula:
PV = Pmt × [(1 - (1 + r)^{-n}) / r]
Where PV is the present value of the loan ($71,500), Pmt is the annual payment, r is the interest rate per period (7% or 0.07), and n is the number of periods (5 years).
Rearranging the formula to solve for Pmt gives us:
Pmt = PV / [(1 - (1 + r)^{-n}) / r]
By plugging the values into the formula, we can calculate the annual payment. After we know the annual payment, we will use it to create the amortization schedule and distribute the payment into interest and principal components for each year, updating the balance accordingly.
Please note that the creation of the complete amortization schedule involves several steps, including repetitive calculations to update the balance and to calculate the interest for each year. The interest is always calculated on the remaining balance of the loan at the start of the year. This explanation is a simplification; the actual amortization schedule would need to be prepared with precise calculations.
Some have argued that higher cigarette prices do not deter smoking. While there are many arguments both for and against this view, some find the following argument to be the most persuasive of all: "The laws of supply and demand indicate that higher prices are ineffective in reducing smoking. In particular, higher cigarette prices will reduce the demand for cigarettes. This reduction in demand will push the equilibrium price back down to its original level. Since the equilibrium price will remain unchanged, smokers will consume the same number of cigarettes." Do you agree or disagree with this view? Explain
Answer:
The tobacco industry is not classically influenced by demand and supply, as it is always a sensitive topic for government policies and economics in general. Since tobacco products (cigarettes) are not an ordinary product, but impose a threat to health instead, their prices are mostly influenced by government or regulatory body decision, rather than general market rules.
So, if cigarette prices become higher (as an aftermath of a regulatory body decision), they will remain that way, no matter if the demand decreases.
The correct statement will be that the prices of cigarettes will not affect the smoking habits of a person, as the person derives pleasure from such smoking.
The example given above is a classic situation to the exception to the law of diminishing marginal utility, where the law does not apply, as the smoker will derive additional utility from each unit.
Exceptions to the law of demandA smoker's habit of smoking will not get affected by the price of cigarettes, as he derives more and more satisfaction with each unit of cigarette consumed by such person, This is an exception to the law of demand that if the prices of a commodity change, the demand will also change. Similar law applies to or an alcoholic.Hence, we can derive that a person who smokes cigarettes will not change his number of units of cigarettes smoked with a change in the price of cigarettes.
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The financial statement that organizes costs by their behavior instead of by their function is the
Answer:
The correct answer is: contribution margin income statement.
Explanation:
The contribution margin income statement organizes costs by behavior and not by function thus it is not used for financial reporting. The variable expenses are deducted from sales to be recorded at a contribution margin. Fixed expenses are subtracted from the net profit obtained at the end of the accounting period.
Suggest some personal traits of leaders you have known. What traits do you believe are most valuable? Why
Explanation:
I am listing below significant personal traits of a leader:
Initiating any task or voluntaryTaking completing responsibility of the task handled by the leader's teamGood motivating skillA great negotiation skillAcceptable interpersonal skillGood level of patientsA good communicatorHand-holding skillAccepting facts and criticismHaving a good attitudeEager to learn new thingsMulti-tasking - ability to manage multiple taskThe main important is creating leaders from his team
Final answer:
Leadership traits such as empathy, integrity, and communication skills contribute to an individual's effectiveness as a leader exemplified by figures like Abraham Lincoln. Charismatic leaders can inspire during crises through their visionary approach, while socialized charismatic leaders focus on collective interests and empowerment.
Explanation:
Leadership traits vary widely among individuals and can be particularly influenced by the context in which a leader operates. When reflecting on Abraham Lincoln's personality, his effectiveness as a leader was largely attributed to his emotional intelligence, ability to communicate, and his integrity. Lincoln demonstrated empathy, had excellent oratory skills, and showed commitment to principles of equality and union. Unlike Lincoln, Jefferson Davis did not exhibit the same level of charismatic authority and struggled with internal disputes and lacked the strong rapport with the public that Lincoln maintained.
Charismatic leaders often emerge during periods of crisis and can harness their personal qualities to influence and motivate followers. They may possess traits such as confidence, determination, and visionary insights, inspiring loyalty and extraordinary efforts among their supporters. Leaders like Mohandas Gandhi exemplified both charismatic and legal-rational authority, showing that leadership can encompass multiple styles. Personalized leaders, who may exhibit narcissistic tendencies, contrast greatly with socialized charismatic leadership, which focuses on empowerment, altruism, and collective interest.
Different leadership styles resonate with various individuals. Some may prefer transformative leaders who inspire through vision and innovation, while others might gravitate toward servant leaders who prioritize the needs of their team or community. People's preferences can be influenced by their own personal values or the particular environment they are in, such as the workplace, classroom, or on a sports team.
Suppose the inflation premium is 2 percent and the nominal interest rate is 1 percent. Instructions: In part a, enter your answer as a whole number. In part b, round your answer to 1 decimal place. If you are entering any negative numbers be sure to include a negative sign () in front of those numbers a. What is the real interest rate? b. What if the inflation premium is 3 percent while the nominal interest rate is 0.5 percent?
Answer:
(a) Real Interest Rate = -1 %
(b) Real Interest Rate = -2.4 %
Explanation:
Real Interest Rate = (1+ Nominal Interest rate)/(1+Inflation Rate) -1
(a)Real Interest Rate = (1+0.01)/(1+0.02)-1
= -1 %
(b) Real Interest Rate = (1+0.005)/(1+0.03) -1
= -2.4 %
Real Interest Rate is an interest rate that has been adjusted to remove the effects of inflation to reflect the real cost of funds to the borrower and the real yield to the lender or to an investor.
Zen began a new consulting firm on January 5. The accounting equation showed the following balances after each of the company’s first five transactions. Analyze the accounting equation for each transaction and match the given transaction with its most likely description.
Assets = Liabilities + Equity
Transaction Cash + Accounts Receivable + Office Supplies + Office Furniture = Accounts Payable + Common Stock + Revenues
a. $ 40,000 + $ 0 + $ 0 + $ 0 = $ 0 + $ 40,000 + $ 0
b. 38,000 + 0 + 3,000 + 0 = 1,000 + 40,000 + 0
c. 30,000 + 0 + 3,000 + 8,000 = 1,000 + 40,000 + 0
d. 30,000 + 6,000 + 3,000 + 8,000 = 1,000 + 40,000 + 6,000
e. 31,000 + 6,000 + 3,000 + 8,000 = 1,000 + 40,000 + 7,000
Transaction Description
a. Started the business with the owner investing cash in the business in exchange for common stock
b. Purchased office supplies, paid in cash and on credit
c. Purchased office furniture by paying cash
d. Billed a customer for services rendered
e. Provided services for cash
Answer:
Explanation:
As we know that
Accounting equation comprise of
Total assets = Total liabilities + Shareholder equity
So, the description of each transaction is as follows:
a. Cash A/c Dr $40,000
To Common stock $40,000
(Being the invested cash in exchange for common stock is recorded)
Since both the above accounts i.e cash account and the common stock are increased by $40,000
b. Office supplies A/c Dr $3,000
To Cash A/c $2,000
To Accounts Payable A/c $1,000
(Being the office supplies are purchased for cash and on credit basis)
This transaction reduced the cash balance by $2,000 ($40,000 - $38,000) and the total office supplies is purchased for $3,000 out of which $2,000 is paid for cash and remaining $1,000 is on credit basis.
c. Office furniture A/c Dr $8000
To Cash A/c $8000
(Being the office furniture is purchase for cash is recorded)
In this transaction, the cash balance is $30,000 and the cash balance in previous balance is $38,000 so it get reduced by $8,000. Although the office furniture balance is also increased by $8,000
d. Accounts receivables A/c Dr $6,000
To Service revenue A/c $6,000
(Being the service rendered is recorded)
In this transaction, both the above accounts are increased by $6,000 each
e. Cash A/c Dr $1,000
To Service revenue A/c $1,000
(Being the service is provided for cash is recorded)
In this transaction, the cash balance is $31,000 and the cash balance in previous balance is $30,000 so it get increased by $1,000 Although the service revenue balance is also increased by $1,000
Transaction Cash + Accounts Receivable + Office Supplies + Office Furniture = Accounts Payable + Common Stock + Revenues
a. $ 40,000 + $ 0 + $ 0 + $ 0 = $ 0 + $ 40,000 + $ 0
a. Started the business with the owner investing cash in the business in exchange for common stock
Transaction cash is increase and common stock is increased.
b. 38,000 + 0 + 3,000 + 0 = 1,000 + 40,000 + 0
b. Purchased office supplies, paid in cash and on credit
Office supplies purchased by hybrid transaction, partially for cash and credit.
c. 30,000 + 0 + 3,000 + 8,000 = 1,000 + 40,000 + 0
c. Purchased office furniture by paying cash
Purchase furniture for office and payed cash
d. 30,000 + 6,000 + 3,000 + 8,000 = 1,000 + 40,000 + 6,000
d. Billed a customer for services rendered
Services delivered to customer on credit, Account receivables increased.
e. 31,000 + 6,000 + 3,000 + 8,000 = 1,000 + 40,000 + 7,000
e. Provided services for cash
Services rendered to customer for cash.
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Many accounting professionals work in one of the following three areas:
A. Financial accounting
B. Managerial accounting
C. Tax accounting
Identify the area of accounting that is most involved in each of the following responsibilities:
1. Investigating violations of tax laws.
2. Planning transactions to minimize taxes.
3. Preparing external financial statements.
4. Reviewing reports for SEC compliance.
5. Internal auditing.
6. External auditing.
7. Cost accounting.
8. Budgeting.
Answer:
1. C.Tax accounting
2. C. Tax accounting
3. A. Financial accounting
4. C. Tax "
5. B. Managerial "
6. A. Financial "
7. B. Managerial "
8. B. Managerial "
Explanation:
Tax accounting: accounting methods focused on tax.
Financial accounting: summary, analysis and reporting of financial transactions.
Managerial accounting: analyzing and communicating financial data to managers.
Final answer:
The three areas of accounting—financial, managerial, and tax accounting—each have specific responsibilities. Tax accountants handle tax law investigations and tax planning, financial accountants prepare external financial statements and conduct both internal and external audits, while managerial accountants deal with cost accounting and budgeting.
Explanation:
Many accounting professionals specialize in different areas, such as financial accounting, managerial accounting, and tax accounting. Each area is involved with specific responsibilities:
Investigating violations of tax laws is most likely the responsibility of someone in tax accounting.Planning transactions to minimize taxes would also fall under the purview of tax accounting.Preparing external financial statements is a primary task of a financial accountant.Financial accounting also includes reviewing reports for SEC compliance, ensuring that statements meet the requirements of the Securities and Exchange Commission.Internal auditing may be considered a part of managerial accounting, as it involves examining efficiency and risk management within the company.External auditing, similar to internal auditing, is typically handled by financial accountants who review a company's financial statements and practices from an outside perspective.Cost accounting is a subset of managerial accounting, which focuses on the costs of production.Budgeting is also a task for managerial accountants, who help organizations plan for future financial decisions.Understanding how transactions shape an organization's basic financial statements is a critical skill for professionals in financial accounting. These statements include the balance sheet, income statement, and cash flow statement, each telling us something about the company's financial status. Through analysis of these statements, organizations make informed financial decisions based on the past earnings record to estimate future earnings potential.
_______ is the phenomenon of the shifting of individual management styles to become more similar to one another.
Answer:
Convergence
Explanation:
Convergence meaning that the two different entities are coming together. It is also defined as the tendency of the group members to become more alike. It is also known as the company culture, in the sense, that the people who work there, tend to have the similar characteristics.
Therefore, the convergence is the phenomenon which states the shifting of the styles of the individual management in order to become more similar to one another.