Answer:
C) Does a bona fide need exist in the year of execution authorized by the appropriation?
Explanation:
Bona fide is a rule which helps to ensure that, there is a bona fide need for the appropriation of money in a given fiscal year. In a situation there is none, then there would be no need for any allocation of money. In the case of funds for the warfighters, the critical question would be if there is any bona fide need for such figher planes or jet.
Incomplete manufacturing costs, expenses, and selling data for two different cases are as follows.(a) Indicate the missing amount. Case 1 2Direct materials used $9,700 $Direct labor 5,100 8,100Manufacturing overhead 8,400 4,100Total manufacturing costs 16,100Beginning work in process inventory 1,100 Ending work in process inventory 3,100Sales revenue 25,000 Sales discounts 2,600 1,500Cost of goods manufactured 17,100 22,100Beginning finished goods inventory 3,400Goods available for sale 22,100 Cost of goods sold Ending finished goods inventory 3,500 2,600Gross profit 7,100Operating expenses 2,800 Net income 5,100
Answer:
Incomplete manufacturing costs:
Case 1 Case 2
Direct materials used $9,700 $3,900
Direct labor 5,100 8,100
Manufacturing overhead 8,400 4,100
Total manufacturing costs 23,200 16,100
Beginning work in process inventory 1,100 9,100
Ending work in process inventory 7,200 3,100
Sales revenue 25,000 31,500
Sales discounts 2,600 1,500
Cost of goods manufactured 17,100 22,100
Beginning finished goods inventory 5,000 3,400
Goods available for sale 22,100 25,500
Cost of goods sold 18,600 22,900
Ending finished goods inventory 3,500 2,600
Gross profit 3,800 7,100
Operating expenses 2,800 2,000
Net income 1,000 5,100
Explanation:
To work out the missing figures involves some manoeuvres of the figures, working up or down as the case may be. For example, to calculate the cost of goods sold in Case 1, I deducted the ending inventory of finished goods from the Goods available for sale. With this figure, it becomes possible to work out the Gross profit and the Net income.
Charles lackey operates a bakery in Idaho, Falls Because of its excellent product location, demand has increased by 35% in the last year. On far too many occasions, customers have not been able to purchase the bread of their choice. Because of the size of the store, no new ovens can be added. At a staff meeting, one employee suggested ways to load the ovens differently so that more loaves of bread can be backed at one time. this new process will require that the ovens be loaded by hand, requiring additional manpower. This is the only production change that will be made in order to meet the increased demand. The bakery currently makes 1,800 loaves per month. Employees are paid $8.00 per hour. In addition to the labor cost, Charles has a constant utility cost per month of $800 and a per loaf ingredient cost of $0.40.
1. Current multi-factor productivity for 640 work hours per month =_____.
2. After increasing the number of work hours to 864 per month, the multi-factor productivity =______.
3. The percentage increase in productivity =______.
Answer:
1) $0.27 per loaf of bread
2) $0.28 per loaf of bread
3) 3.7%
Explanation:
current production = 1,800 loaves per month
current labor expense = $8 per hour
constant utility cost = $800
ingredients per loaf = $0.40
multi-factor productivity = total output / (labor + materials + overhead)
current multi-factor productivity = 1,800 loaves / ($5,120 + $800 + $720) = $0.27 per loaf of bread
new output level = 1,800 x 1.35 = 2,430 loaves
new multi-factor productivity = 2,430 loaves / ($6,912 + $800 + $972) = $0.28 per loaf of bread
% increase = ($0.28 - $0.27) / $0.27 = 3.7%
Explain and comment on any factors related to organizational culture and innovation within Mattel’s setting that might have influenced the company to move in a more positive direction.
Answer: There were many shortcomings in the organizational culture of Mattel setting.
Explanation:
Mattle would have been influenced in a more positive direction, if the following factors were implemented in the relation.:
1. If the company had reviewed its goal, it could redefine its product.
2. The managers not allowed the design of new products that would be meeting the changing needs of the customers.
3. Mattle should have adopted an organizational structure that could be useful in production and could be helpful in changing the market demands.
Workplace technology is relied upon by businesses to increase _____________. Employee turnover Philanthropy Efficiency and effectiveness Malfunction and futility
Answer:
Workplace technology is relied upon by businesses to increase _____________.
Efficiency and effectiveness
Explanation:
Workplace technology including the use of computer systems, internet, and other communication and information devices has propelled manufacturing and eased communication. Technology has exponentially improved the rate of production and speed at which business occurs. Technology in the workplace has helped factory and administrative workers to become more efficient than ever before with the automation of the many processes. As efficiency is increased, so has effectiveness in the production of desired results been improved tremendously. For instance, a process or set of processes that used to take hours now can take only minutes.
Klara wants to compare the price of a wallet she saw at Nordstrom Rack with other stores that may have the same wallet. She locates the product of three different websites, including Amazon. Klara’s quest is an example of how customers are using __________ to solve problems.
This question is incomplete because the options are missing, here is the missing part:
Klara’s quest is an example of how customers are using __________ to solve problems.
A. Price shopping
B. Databases
C. Information technology
D. Social networking
The answer to this question is C. Information technology
Explanation:
Webpages and the internet are part of Information technology because these two tools allow users to obtain or share information by using technologies such as mobile phones or computers. Moreover, nowadays, information technologies help an essential role in the process of selling and buying products because through these companies can advertise their products and customers can obtain information about them or even buy them.
The use of information technology in buying and selling is exemplified by Kiara because she used the internet as a tool to find the web pages that sold a specific wallet and then know the price. Also, the use of this information technology helps Kiara make the best buying decision.
On January 2, 2015, Denny Corp. enters into a five-year capital lease for machinery with annual payments of $15,000. Complete the necessary journal entry by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Answer:
some information was missing, the present value of the equipment which is $65,000
the journal entries to record the lease agreement is:
January 2, 2015, five year lease for machinery
Dr Machinery 65,000
Cr Lease liability 65,000
then you must record the lease payment, since it is done immediately, there is no interest expense recorded:
January 2, 2015, first annual lease payment
Dr Lease liability 15,000
Cr Cash 15,000
Only the first lease payment will not include an interest expense since it was done the same day as the machinery was leased.
Which source of law takes priority in the following situations, and why?
a) A federal statute conflicts with the U.S. constitution.
b) A federal statute conflicts with a state constitutional provision.
c) A state statute conflicts with the common law of that state.
d) A state constitutional amendment conflicts with the U.S. constitution.
Answer:
a) A federal statute conflicts with the U.S. constitution.
b) A federal statute conflicts with a state constitutional provision.
Explanation:
As per the Article Vi of the United States constitution, the constitution represents the supreme law of the land if there is any kind of violation that would be declared as non-constitutional and hence not enforced irrespective of what source should be enforced
Also the statutes of the federal state took pattern over the provision of state constitution
Hence, the a and b are correct
Prepaid items on financial statements
Therapy Inc. experienced the following events in 2013, its first year of operation:
1. Performed counseling services for $18,000 cash.
2. On February 1, 2013, paid $12,000 cash to rent office space for the coming year.
3. Adjusted the accounts to reflect the amount of rent used during the year.
Required
Based on this information alone
a. Record the events under an accounting equation.
b. Prepare an income statement, balance sheet, and statement of cash flows for the 2013 accounting period.
c. Ignoring all other future events, what is the amount of rent expense that would be recognized in 2014?
Answer:
a. Record the events under an accounting equation (I divided the accounting equation in 2)
assets = liabilities + equity
cash prepaid rent
1) 18,000 0 0 18,000
2) -12,000 12,000
3) 0 -11,000 0 -11,000
revenue - expenses = net income cash flow type
1) 18,000 0 18,000 18,000 OA
2) 0 0 0 -12,000 OA
3) 0 11,000 -11,000 0 OA
b. Prepare an income statement, balance sheet, and statement of cash flows for the 2013 accounting period.
Therapy Inc.
Income Statement
For the year ended December 31, 2013
Service revenue $18,000
Rent expense ($11,000)
Net income $7,000
Therapy Inc.
Income Statement
For the year ended December 31, 2013
Assets:
Cash $6,000
Prepaid rent $1,000
Total assets $7,000
Liabilities $0
Equity
Retained earnings $7,000
Total liabilities and equity $7,000
Therapy Inc.
Cash Flow Statement
For the year ended December 31, 2013
Cash flows from operating activities
Net income $7,000
Adjustments to net income:
Increase in prepaid rent ($1,000)
Net cash flow from operating activities $6,000
Cash flows from investing activities: $0
Cash flows form financing activities: $0
Net increase in cash $6,000
Beginning cash balance $0
Ending cash balance $6,000
c. Ignoring all other future events, what is the amount of rent expense that would be recognized in 2014?
If they continue to rent the same office, the rent expense for 2014 should be $12,000 (assuming that rent didn't change)
A plaintiff in a high profile legal suit was offered the following out of court settlement: We the defendent will pay the lump sum of $200 to the plaintiff in exactly 11 years. Or alternatively, we will negotiate a lump sum payment today. According to time value of money, what lump sum amount today will have the same present value as the offered settlement if the interest rate of 4.2%?$______ Place your answer in dollars and cents. Do not include a dollar sign or a comma. Work your analysis out with at least 4 decimal places of accuracy.
The primary functions of accounting are to:_________
Answer:
c. measure a company's activities.
e. communicate information to decision makers.
Explanation:
Accounting's main purpose is to record the activities of a company because record keeping is very important as it primarily shows whether the company is making a profit or a loss.
The records can then be submitted to decision makers and stakeholders who will then use the information given to guide decisions that they will make for themselves, the company or both.
Of the four sources of cash listed below, which can be found in the balance sheet?a. funds provided by operations.b. funds provided by borrowing.c. funds provided by the sale of assets.d. funds provided by issuing common or preferred stock.e. all of the above.
Answer: b. funds provided by borrowing.
c. funds provided by the sale of assets.
d. funds provided by issuing common or preferred stock.
Explanation:
The financial statement consists of two main components which are the balance sheet and the income statement. The balance sheet simoly shows the financial standing of a firm.
Of the options, those that can found in the balance sheet are:
b. funds provided by borrowing.
c. funds provided by the sale of assets.
d. funds provided by issuing common or preferred stock.
A company that loans money to an organization is a(n):______.a. supplier.b. lender.c. shareholder.d. investor.
Answer:
lender.
Explanation:
A lender is an individual or company that makes funds available another com[any. Lenders receive fixed payments based on a predetermined rate at an agreed time.
A shareholder is the owner of a company. A shareholder is a person who buys the stock of a publicly traded company
Supplier provides raw materials needed for production to a company
An investor can either be a lender or shareholder
Investment company advertising is prohibited from showing:_______
Answer: performance projections
Explanation:
Investment company advertising is prohibited from showing performance projections.
In 1994, The Securities and Exchange Commission approved amendments that hinders the members from using rankings in investment company in sales literature and advertisements unless some particular requirements are being met.
Match the following definitions to the appropriate term. Each term may be used only once or not at all. Definition (or partial definition) A. Used in preparing dividend payments and other communication with shareholdersB. A document that contains requirements such as fund. C. An unsecured bond, dependent upon the general credit of he issuer. D. Charged with maintaining detailed records of shareholders and handling purchases and sales of stock. E. A book that contains the record of shares issued in numerical sequence. 1. Capital stock 2. Debenture bond3. Paid-in Capital in excess of par4. Security bond 5. Sinking fund 6. Stock certificate book 7. Stock reconciliation file 8. Stock certificate holder 9. Stockholders ledger 10. Stock transfer agent 11. Treasury stock 12. Trust indenture
Answer:
Explanation:
Match the definitions to the appropriate term
TERMS:
1. CAPITAL STOCK 2. DEBENTURE BOND
3. PAID-IN CAPITAL IN EXCESS OF PAR 4. SECURITY BOND
5. SINKING FUND 6. STOCK CERTIFICATE BOOK
7. STOCK RECONCILIATION FILE 8. STOCK CERTIFICATE HOLDER
9. STOCKHOLDERS LEDGER 10. STOCK TRANSFER AGENT
11. TREASURY STOCK 12. TRUST INDENTURE
DEFINITIONS:
NOTE: Since the definitions given are 5 in number and each term may be used only once or not at all; only 5 of the terms will be used.
For statement (A), Term 9 matches
For statement (B), Term 12 matches
For statement (C), Term 2 matches
For statement (D), Term 10 matches
For statement (E), Term 6 matches
What is the price of a perpetuity that has a coupon of $50 per year and a yield to maturity of 2.5%? If the yield to maturity doubles, what will happen to its price?
Answer:
1.
$2000
2.
If the yield to maturity doubles,the price of perpetuity would reduce by 100%
Explanation:
The price of the perpetuity is determined by dividing the coupon by the yield to maturity as shown below:
price=coupon/yield to maturity
coupon=$50
yield to maturity=2.5%
price=$50/2.5%
price=$2000
If the yield to maturity doubles, it becomes 5% and a new price is shown below:
price=$50/5%=$1000
A report on the effectiveness of internal control over financial reporting as required by Section 404 of the Sarbanes-Oxley Act. Which option is correct:
1. An audit of historical financial statements
2. An attestation service other than an audit service
3. An assurance service that is not an attestation service
Answer:
2. An attestation service other than an audit service
Explanation:
When auditors are engaged to give an independent opinion that internal controls designed over financial reporting are working as or otherwise, the report of such engagement is known as an attestation service other than an audit service. In other words, a confirmation of the effectiveness of internal controls other than audit of financial statements
The flow rate of customers at a state fair is 100 per hour. The fair is open from 8 a.m. to 8 p.m. How many customers come through the fair during that time?
Answer:
1,200 customers
Explanation:
Calculation for how many customers come through the fair during that time
Based on the information given about the time the fair is open, we were told that they do open from 8am in the morning to 8pm in the night which means that 8am to 8pm will give us 12 hours
Now let calculate for the numbers of customers that come through the fair during that time Using this formula
Numbers of customers =Flow rate of customers per hr×Numbers of hours
Let plug in the formula
Numbers of customers =100 customers per hr x 12 hrs
Numbers of customers == 1,200 customers
Therefore the numbers of customers that come through the fair during that time will be 1,200 customers.
A registered investment adviser and its representatives have been registered in a State for the past 5 years. The current registration manager of the adviser resigns in November and the firm retains an executive search firm to find a new registration manager. The position is filled in June of the following year and the new registration manager finds that registration renewals has not been filed. Which statement is TRUE?
a. The registered investment adviser must re-register in the State, but not the investment adviser representatives
b. The investment adviser representatives must re-register in the State, but not the investment adviser
c. Both the investment adviser and the investment adviser representatives must re-register in the State
d. Neither the investment adviser nor the investment adviser representatives are required to re-register in the State
Based on the given information, the statement which is true is Neither the investment adviser nor the investment adviser representatives are required to re-register in the State. Thus the correct option is D.
What is a manager?
A manager refers to a person who is responsible head of any project and helps in arranging the resources, checking the progress, and timely completion of it in order to achieve the vision and goal of the organization.
In the given case, it is explained that For the last five years, a registered investment adviser and its agents have been registered in a State. The adviser's existing registration manager resigns in November, and the company hires an executive search agency to locate a replacement.
The State does not need the investment adviser or the investment adviser representatives to re-register according to the given information.
Therefore, option D is appropriate.
Learn more about Managers, here:
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The following information pertains to Marigold Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.Assets Cash and short-term investments $ 40,000Accounts receivable (net) 30,000Inventory 25,000Property, plant and equipment 215,000Total Assets $310,000Liabilities and Stockholders' Equity Current liabilities 60,000Long-term liabilities 95,000Stockholders' equity-common 155,000Total Liabilities and stockholders' equity $310,000Income Statement Sales $ 90,000Cost of goods sold 45,000Gross margin 45,000Operating expenses 20,000Net income $ 25,000Number of shares of common stock 6,000000Market price of common stock $40Dividends per share 1.00Cash provided by operations $40,000What is the rate earned on total assets for this company?A. 8.1%B. 6.8%C. 10.5%D. 16.1%
Answer:
Marigold Company
The rate earned on total assets for Marigold = Net Income/Total Assets * 100
= $ 25,000/$310,000 * 100
= 8.06%
Explanation:
a) Data:
Assets
Cash and short-term investments $ 40,000
Accounts receivable (net) 30,000
Inventory 25,000
Property, plant and equipment 215,000
Total Assets $310,000
Liabilities and Stockholders' Equity
Current liabilities 60,000
Long-term liabilities 95,000
Stockholders' equity-common 155,000
Total Liabilities and stockholders' equity $310,000
Income Statement
Sales $ 90,000
Cost of goods sold 45,000
Gross margin 45,000
Operating expenses 20,000
Net income $ 25,000
Number of shares of common stock 6,000000
Market price of common stock $40
Dividends per share 1.00
Cash provided by operations $40,000
b) Marigold's Return on assets (ROA) indicates how profitable it is relative to its total assets. Its ROA gives a manager, investor, or analyst an idea as to how efficient Marigold's management is at using the company's assets to generate earnings. As a percentage, Marigold's Return on assets is 8.06%.
The following information was reported in the December 31, 2012, financial statements of Southeast Airlines, Inc. (listed alphabetically, amounts in millions).Accounts Payable $4,155Accounts Receivable 700Aircraft Fuel Expense 9,900Cash 3,090Common Stock 1,280Dividends 15Equipment 15,810Income Tax Expense 310Interest Expense 250Landing Fees Expense 4,300Notes Payable 7,010Repairs and Maintenance Expense 2,400Retained Earnings (as of December 31, 2012) 7,895Salaries and Wages Expense 3,460Supplies 740Ticket Revenues 23,100Prepare an income statement for the year ended December 31, 2012.
Answer and Explanation:
The preparation of the income statement for the year ended Dec 31,2012 is shown below"
Southeast Airlines, Inc.
Income statement
For the year ended December 31, 2012
Revenue
Ticket Revenues $23,100
Total revenues $23,100 (A)
Less: Expenses
Aircraft Fuel Expense $9,900
Income Tax Expense $310
Interest Expense $250
Landing Fees Expense $4,300
Repairs and Maintenance Expense $2,400
Salaries and Wages Expense $3,460
Total expenses $20,620 (B)
Net income $2,480 (A- B)
The process of planning and managing a firm’s long-term assets is called:______.
A. Capital Budgeting
B. Agency Cost Analysis
C. Capital Structure
Which of the following statements about the income and substitution effects of an income tax rate increase is true? A. The income and substitution effects are contradictory behavioral reactions. B. From the government's perspective, the substitution effect is more desirable than the income effect. C. Faith in the income effect is the foundation for supply-side economic theory. D. Dynamic forecasts of incremental tax revenues must consider the potential income effect but not the potential substitution effect of a rate increase.
Answer:
D. Dynamic forecasts of incremental tax revenues must consider the potential income effect but not the potential substitution effect of a rate increase.
Explanation:
This is because, an increase in taxes would affect the incomes of the people thereby decreasing the disposable income available to people while on the other-hand, there will be no substitution available for them unlike if the situation where to be with regards to goods and services.
Answer:
A, C, and D!!!
Explanation:
100% on edge :)
J. Brown provided services to a customer and immediately collected $1,900 cash. Show how to record the transaction to the T-accounts by completing the following sentence.
Service Revenue would be ____________ on the _______________ side of the T-account, and Cash would be ______________ on the _______________ side of the T-account.
Answer and Explanation:
Since in the question it is mentioned that the J.brown provides a service and on the instant it collected the cash for $1,900
So here the journal entry that would be
Cash Dr $1,900
To Service revenue $1,900
(Being cash collected is recorded)
The service revenue is shown in the on the right side of the T-account that should be credited and the cash to be shown on the left hand side of the T-account that should be debited as both the account is increasing.
The mission of the National Association of Advertising (NAA) is to improve and strengthen the ad agency business, to advocate advertising, to influence public policy, to resist advertising-related legislation that it regards as unwise or unfair, and to work with government regulators to achieve desirable social and civic goals
a. True
b. False
Answer: False
Explanation:
The above statement is wrong as the function described is that of the American Association of Advertising Agencies which is a trade association for the advertising agencies in the United States.
The goal of the American Association of Advertising Agencies is to strengthen and also improve advertising agency business and to also help its member agencies to enjoy more profit and be more effective and efficient.
If a firm is a price taker in both the labor market and the output market, it will:______.a. exceeds the marginal revenue product of labor.b. equals the marginal revenue product of labor.c. is less than the marginal revenue product of labor.d. equals the marginal physical product of labor.
Answer:
(C)
Explanation:
First, what does it mean for a firm to be a price-taker and then in 2 market places?
If a firm is a price-taker, this means that the firm accepts the price presented by the other group. The other group in this case is either laborers (labor market) or customers/other firms (output market).
A firm that is a price-taker does not set or use its own desired price and this is usually for business reasons.
The labor market is a resource market; since labor is one of the resource inputs or factors used in production.
A price-taker firm in the labor market is one that accepts the price at which labor(ers) chooses to work. This price could be lower or higher than what the firm is willing and able to pay.
The output market is the market for buying and selling of finished or semi-finished goods/products. It is the final market; where manufactured goods are made available to their various consumers.
A price-taker firm in the output market is one that accepts the price set by other firms in the industry or the price agreed upon by consumers. Again, this price could be higher or lower than the price at which the producer is willing to give the product away.
Now, what happens to the income statistics of firm that is a price-taker in both the labor market and the output market?
The firm will be running on less than the marginal revenue product of labour.
The Mugger sells three types of mugs, flowers, dogs, and sports. The following information is available: Flowers Dogs Sports Total Sales Volume 25,000 100,000 50,000Selling Price $20 $25 $10Variable cost per unit 10 20 6Total fixed costs $500,000 REQUIRED: 1. What is the breakeven point for The Mugger? 2. Would you recommend promoting the change in product mix to 4 to 2 to 1 of flower mugs, dog mugs, and sports mugs? Why?
Answer:
See answer below
Explanation:
1. The break even point for flowers = Fixed costs / Contribution margin
Where contribution margin = Selling price per unit - Variable cost per unit
= $500,000 / ($20 - $10)
= $500,000 / $10
= 50,000 units
Therefore,
Break even point for the Mugger is 50,000 units.
Break even points for Dogs = Fixed costs ÷ Contribution margin
= $500,000 / ($25 -$20)
= $500,000 / $5
= 100,000 units
Break even points Sports = Fixed costs / Contribution margin
= $500,000 / ($10 - $6)
= $500,000 / $4
= 125,000 units
2. I can recommend that the mugger should change its product mix from 1:4:2 (Flowers, dogs, sports) to 4:2:1 (Flowers , dogs , sports)
• Because there is an increase in the break even points for each of the mugger.
Bearcat Construction begins operations in March and has the following transactions.
March 1 Issue common stock for $17,500.
March 5 Obtain $8,300 loan from the bank by signing a note.
March 10 Purchase construction equipment for $21,500 cash.
March 15 Purchase advertising for the current month for $1,000 cash.
March 22 Provide construction services for $17,300 on account.
March 27 Receive $12,300 cash on account from March 22 services.
March 28 Pay salaries for the current month of $5,300.
Required:
Record each transaction. Bearcat uses the following accounts: Cash, Accounts Receivable, Notes Payable, Common Stock, Service Revenue, Advertising Expense, and Salaries Expense.
Answer:
Bearcat Construction
General Journal
March 1
Cash $17,500 (debit)
Common Stock $17,500 (credit)
Cash Received in Exchange of Common Stock
March 5
Cash $8,300 (debit)
Note Payable $8,300 (credit)
Cash received from Bank Loan
March 10
Equipment (debit)
Cash (credit)
Purchase of Equipment by Cash
March 15
Advertising Expenses (debit)
Cash (credit)
Advertising Expense paid in Cash
March 22
Accounts Receivable $17,300 (debit)
Service Revenue $17,300 (credit)
Service Rendered on Credit
March 27
Cash $17,300 (debit)
Accounts Receivable $17,300 (credit)
Cash Received from Accounts Receivables
March 28
Salaries Expense $5,300 (debit)
Cash $5,300 (credit)
Salaries paid in Cash
Explanation:
See the Journal Entries and Narrations that i have prepared above.
The following transactions were incurred by Stoncius Fabricators during January, the first month of its fiscal year. i (Click the icon to view the transactions) Requirements 1. Record the proper journal entry for each transaction 2. By the end of January, was manufacturing overhead overallocated or underallocated? By how much? a. $170,.000 of materials was purchased on account. Record the entry (Record debits first, then credits. Exclude explanations from any journal entries.) Journal Entry Date Accounts Credit a. Raw Materials Inventory Accounts Payable 170000 170000 b. $162,000 of materials was used in production, of this amount, $143,000 were used on speciffe obs. Record the entry. ournal Entry Date Accounts Debit Credit b. Work in Process Invento Manufacturing Overhead Raw Materials Inventory 143000 19000 162000 c. Manufacturing labor and salaries for the month totaled $220,000. A total of $200,000 of manufacturing labor and salaries was traced to specific jobs, and Journal Entry Date Accounts Debit Credit
Answer:
Journal entries are given
Explanation:
Raw materials used for special jobs will be allocated to work in process and the remaining used in production will be allocated to manufacturing overhead.
Requirement 1
A (Materials was purchased on account)
DEBIT CREDIT
Raw Material Inventory $170,000
Accounts Payable $,170,000
B (Materials was used in production)
DEBIT CREDIT
Work In process Inventory $143,000
Manufacturing Overhead $19,000
Raw Material Inventory $162,000
C (Manufacturing labor and salaries for the month)
DEBIT CREDIT
Work In process Inventory $200,000
Manufacturing Overhead $20,000
Wages payable $220,000
Requirement 1
There NO such information available in the question to determine whether manufacturing overheads are over-allocated or under-allocated.
Recent financial statements for Madison Company follow:Recent financial statements for Madison Company follow: Madison Company Balance Sheet June 30Assets Current assets: Cash $21,000 Accounts receivable, net 160,000 Merchandise inventory 300,000 Prepaid expenses 9,000 Total current assets 490,000 Plant and equipment, net 810,000 Total assets $1,300,000 Liabilities and Stockholders' EquityLiabilities: Current liabilities $200,000 Bonds payable, 10% 300,000 Total liabilities 500,000 Stockholders’ equity: Common stock, $5 par value $100,000 Retained earnings 700,000 Total stockholders’ equity 800,000 Total liabilities and stockholders' equity $1,300,000 Madison Company Income Statement For the Year Ended June 30Sales $2,100,000 Cost of goods sold 1,260,000 Gross margin 840,000 Selling and administrative expenses 660,000 Net operating income 180,000 Interest expense 30,000 Net income before taxes 150,000 Income taxes 45,000 Net income $105,000 ccount balances at the beginning of the company’s fiscal year were: accounts receivable, $140,000; and inventory, $260,000. All sales were on account.Required:Compute financial ratios as follows:1. Gross margin percentage. 2. Current ratio. (Round your answer to 2 decimal places.)3. Acid-test ratio.4. Average collection period. 5. Average sale period. 6. Debt-to-equity ratio. 7. Times interest earned.8. Book value per share.
Answer:
1. Gross margin percentage = 40%
2. Current ratio. (Round your answer to 2 decimal places.) = 2.45
3. Acid-test ratio = 0.95
4. Average collection period = 26 days
5. Average sale period = 81 days
6. Debt-to-equity ratio = 0.63
7. Times interest earned = 6 times
8. Book value per share = $40 per share
Explanation:
1. Gross margin percentage.
This can be calculated using the following formula:
Gross margin percentage = (Gross margin / Sales) * 100 .......... (1)
Where;
Sales = $2,100,000
Gross margin = $840,000
We substitute the values into equation (1) and have:
Gross margin percentage = ($840,000 / $2,100,000) * 100 = 0.40 * 100 = 40%
2. Current ratio. (Round your answer to 2 decimal places.)
This can be calculated using the following formula:
Current ratio = Total current assets / Current liabilities ............ (2)
Where;
Total current assets = $490,000
Current liabilities = $200,000
We substitute the values into equation (2) and have:
Current ratio = $490,000 / $200,000 = 2.45
3. Acid-test ratio.
This can be calculated using the following formula:
Acid-test ratio = (Total current assets – Closing Merchandise Inventory) / Current liabilities ........ (3)
Where;
Total current assets = $490,000
Closing Merchandise Inventory = $300,000
Current liabilities = $200,000
We substitute the values into equation (3) and have:
Acid-test ratio = ($490,000 - $300,000) / $200,000 = $190,000 / $200,000 = 0.95
4. Average collection period.
This can be calculated using the following formula:
Average collection period = (Average accounts receivable / Sales) * 365 days …….. (4)
Where;
Average accounts receivable = (Beginning account receivable + Ending account receivable) / 2 = ($140,000 + $160,000) / 2 = $300,000 / 2 = $150,000
Sales = $2,100,000
We substitute the values into equation (4) and have:
Average collection period = ($150,000 / $2,100,000) * 365 = 26 days approximately.
5. Average sale period.
This can be calculated using the following formula:
Average sale period = 365 days / Inventory turnover ……………………….. (5)
Where;
Inventory turnover = Cost of goods sold / Average inventory = Cost of goods sold / [(Opening inventory + Closing inventory) / 2] = 1,260,000 / [($260,000 + $300,000) / 2] = 1,260,000 / [$560,000 / 2] = 1,260,000 / $280,000 = 4.50
We substitute the values into equation (5) and have:
Average sale period = 365 days / 4.50 = 81 days
6. Debt-to-equity ratio.
This can be calculated using the following formula:
Debt-to-equity ratio = Total liabilities / Total stockholders’ equity ……………………. (6)
Where;
Total liabilities = $500,000
Total stockholders’ equity = $800,000
We substitute the values into equation (6) and have:
Debt-to-equity ratio = $500,000 / $800,000 = 0.63
7. Times interest earned.
This can be calculated using the following formula:
Times interest earned = Income before interest and tax / Interest expense ……………….. (7)
Where;
Income before interest and tax = Net operating income = $180,000
Interest expense = $30,000
We substitute the values into equation (7) and have:
Times interest earned = $180,000 / $30,000 = 6 times
8. Book value per share.
This can be calculated using the following formula:
Book value per share = Total stockholders’ equity / Number of shares outstanding ……….. (8)
Where;
Total stockholders’ equity = $800,000
Number of shares outstanding = $100,000 / $5 = 20,000 shares
We substitute the values into equation (8) and have:
Book value per share = $800,000 / 20,000 = $40 per share
When Coca Cola introduced Coke Zero,this was an example of a _____ strategy.
A) repositioning
B) product line extension
C) cannibalization
D) disintermediation
E) demarketing
Answer:
B) product line extension
Coke Zero is an example of Coca Cola expanding their line of products. They are adding in more options for consumers to buy.