The incremental manufacturing cost that the company will incur if it increases production from 5,500 to 5,501 units is closest to $10.65.
Here, the fixed cost would not be relevant for the computation.
Incremental manufacturing cost when production level changed is
= Direct material cost per unit + Direct labor cost per unit + Variable manufacturing overhead per unit
= $6.25 + $3.20 + $1.20
= $10.65
In conclusion, the incremental manufacturing cost that the company will incur if it increases production from 5,500 to 5,501 units is closest to $10.65.
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The income statement of Sheridan Company for the month of July shows net income of $3,480 based on Service Revenue $7,890, Salaries and Wages Expense $2,860, Supplies Expense $940, and Utilities Expense $610. In reviewing the statement, you discover the following:
1. Insurance expired during July of $470 was omitted.
2. Supplies expense includes $410 of supplies that are still on hand at July 31.
3. Depreciation on equipment of $150 was omitted.
4. Accrued but unpaid wages at July 31 of $320 were not included.
5. Service performed but unrecorded totaled $640.
Prepare a correct income statement for July 2014.
Answer:
what do u want from me monq I told you bye so bye mean bye
Conrad, Inc. recently lost a portion of its records in an office fire. The following information was salvaged from the accounting records.
Cost of Goods Sold $ 65,000
Work-in-Process Inventory, Beginning 10,500
Work-in-Process Inventory, Ending 9,000
Selling and Administrative Expense 15,000
Finished Goods Inventory, Ending 15,000
Finished Goods Inventory, Beginning?
Direct Materials Used ?
Factory Overhead Applied 12,000
Operating Income 14,000
Direct Materials Inventory, Beginning 11,000
Direct Materials Inventory, Ending 6,000
Cost of Goods Manufactured 60,000
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead. The CFO of Fisher, Inc. has asked you to recalculate the following accounts and to report to him by the end of the day. What is the amount of direct materials used?
Answer:
See below
Explanation:
Direct materials used = Cost of goods manufactured - work in process inventory, beginning - factory overhead applied - direct labor + work in process inventory, ending
= $60,000 - $10,500 - $12,000 - (1.5 × $12,000) + $9,000
=
A firm's current profits are $1,400,000. These profits are expected to grow indefinitely at a constant annual rate of 4 percent. If the firm's opportunity cost of funds is 7 percent, determine the value of the firm:
Answer:
$ 48,533,333.33
Explanation:
The value of the firm now is the present value of its profits using the constant growth rate model formula as provided below:
PV of profits(value of the firm)=expected profits/(opportunity cost of funds-constant growth rate)
expected profits=current profits*(1+constant growth rate)
current profits =$1,400,000
constant growth rate=4%
expected profits=$1,400,000*(1+4%)
expected profits=$1,456,000
the opportunity cost of funds=7%
PV of profits(value of the firm)=$1,456,000/(7%-4%)
PV of profits(value of the firm)=$1,456,000/3%
PV of profits(value of the firm)=$ 48,533,333.33
Different vibrations make different sounds. True or false?
this is for science
The answer is true, because a large vibration might make a deep sound, or a loud sound, while a small vibration could make a soft sound or a high pitched sound.
Answer:
Different vibrations makes different sounds.
Its True
Type the correct answer in the box. Spell all words correctly.
What are the three ways through which a company tries to sell its products?
Businesses generally sell through a product's features, benefits, or
Reset
Next
Answer:
Values
Explanation:
Businesses generally sell through a product's features, benefits, or values
Value selling refers to the process of convincing buyers that your products will add value to their lives. It involves giving reasons and reinforcing why your products are the most valuable in the market.
Value selling focuses on the value derived from consuming a product but not how much it costs. In value selling, the salesperson highlights the impact a product creates rather than its purchase costs.
BuyCo, Inc., holds 25 percent of the outstanding shares of Marqueen Company and appropriately applies the equity method of accounting. Excess cost amortization (related to a patent) associated with this investment amounts to $10,800 per year. For 2020, Marqueen reported earnings of $102,000 and declares cash dividends of $30,000. During that year, Marqueen acquired inventory for $54,000, which it then sold to BuyCo for $75,000. At the end of 2020, BuyCo continued to hold merchandise with a transfer price of $29,000.
1. What Equity in Investee Income should BuyCo report for 2017?
2. How will the intra-entity transfer affect BuyCo's reporting in 2018?
3. If BuyCo had sold the inventory to Marqueen, how would the answers to (a) and (b) have changed?
Answer and Explanation:
The computation is shown below:
a. The equity in investee income for the year 2017 is
Equity income Accrual ($102,000 × 25%) $25500
Less: Deferral of Infra-entity gross profit ($2,030)
Less: Amortization of patent ($10,800)
Equity in investee income $12,670
Working Note:
For Deferral of intraentity gross profit :-
Ending Balance of Inventory $29,000
Gross Profit Percentage (($75,000 - $54,000) ÷ $75,000) 28%
Profit within Remaining Inventory $8,120
Ownership Percentage 25%
Intraentity gross Profit Deferral $2,030
b. The intra-entity impact for the year 2018 is that yhe accrual equity would be increased by $2,030
c. In the case when the inventory is sold from BuyCo to Marqueen so the direction i.e. upstream or downstream would remain unaffected the above answers
An internal study by the Technology Services department at Lahey Electronics revealed company employees receive an average of 6.0 non-work-related e-mails per hour. Assume the arrival of these e-mails is approximated by the Poisson distribution.
a. What is the probability Linda Lahey, company president, received exactly 1 email between 4 P.M. and 5 P.M. yesterday?
b. What is the probability she received 5 or more emails during the same period?
c. What is the probability she did not receive any emails during the period?
Answer:
B.
Explanation:
measure of how many times an event is likely to occur within "X" period of time. the closest answer is letter B. Example if the fastfood had an average of 500 customer every Wednesday what is the probability that 700 customers will come every Wednesday?.
A couple of generations ago, a relative of Sophia wanted to share his wealth with family members and decided to open a special bank account. The purpose of such financial instrument was to pay out an annuity forever, which would be shared among all family members. Given that the initial deposit was 478,694 dollars and the prevailing interest rate at that time was 5 %, compounded annually, find the value of the annuity this family collects every year.
Answer:
$23,934.70
Explanation:
Perpetuity (P) Present Value = Deposit = $478,694
Perpetuity annuity value = Deposit * Interest rate
Perpetuity annuity value = $478,694 * 5%
Perpetuity annuity value = $23,934.70
Caroline is an unmarried single mother of a 14 year old son in 2020. Caroline's spouse and the son's father, Frank, died during 2018. Caroline's Adjusted Gross Income for 2020 is 54,000. Caroline's itemized deductions are $10,000. What is Caroline's computed Income Tax Liability for 2020 BEFORE CONSIDERING ANY TAX CREDITS
Answer:
the income tax liability for the year 2020 is $9,680
Explanation:
The computation of the income tax liability for the year 2020 is as follows:
= (Adjusted gross income) - (itemized deductions) × tax rate
= ($54,000 - $10,000) × 0.22
= $44,000 × 0.22
= $9,680
We assume the tax rate be 22%
hence, the income tax liability for the year 2020 is $9,680
Miriam, the controller, is basically claiming that the company is retaliating against her for being pregnant, and that the fact that we raised performance issues was just a smokescreen. Do you think the EEOC and/or courts would agree with her, and, in any case, what should we do now?
Answer:
the EEOC and/or courts would agree with her
Explanation:
The pregnancy act and family and medical leave act states that when a pregnant woman is unable to do her job effectively because of her condition she should treat her as a temporarily disabled person.
Miriam can take advantage of various benefits of temporarily disabled persons like less hours, disability leave, and modified tasks.
What should be done now is that Miriam should take on fewer hours and less stressful jobs until she recovers and can function fully.
If not she can sue the company for not respecting provisions of the pregnancy act
Ryan is self-employed. This year Ryan used his personal auto for several long business trips. Ryan paid $1,920 for gasoline on these trips. His depreciation on the car if he was using it fully for business purposes would be $3,900. During the year, he drove his car a total of 20,200 miles (a combination of business and personal travel). (Round your final answers to the nearest whole dollar amount.)
Required:
a. Ryan can provide written documentation of the business purpose for trips totaling 3,700 miles. What business expense amount can Ryan deduct (if any) for these trips?
b. Ryan estimates that he drove approximately 2,220 miles on business trips, but he can only provide written documentation of the business purpose for trips totaling 1,400 miles. What business expense amount can Ryan deduct (if any) for these trips?
Answer:
a. $2,634.36
$1,481.11
Explanation:
a. Ryan can claim the direct costs of the trip being gasoline and oil. He can therefore claim the $1,920 he paid for gasoline.
In addition, some of the indirect costs can be claimed as well such as depreciation. The claim is calculated as:
= Depreciation amount * Business miles / Total miles driven
= 3,900 * 3,700 / 20,200
= $714.36
Total deduction = 1,920 + 714.36
= $2,634.36
b. Ryan needs to be able to prove that the cost he is claiming are indeed business expenses. Total deductibles are:
= (3,900 * 1,400/ 20,200) + (1,400/2,220 * 1,920)
= $1,481.11
The primary difference between a change in supply and a change in the quantity supplied is: Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a both a change in quantity supplied and a change in supply are shifts in the supply curve, only in different directions. b both a change in quantity supplied and a change in supply are movements along the supply curve, only in different directions. c a change in supply is caused by a change in the price of the good itself, and a change in quantity supplied is caused by a change in a non-price determinant of supply. d a change in quantity supplied is caused by a change in the price of the good itself, and a change in supply is caused by a change in a non-price determinant of supply.
Answer:
D
Explanation:
A change in quantity supplied is as a result of a change in the price of the good. This change in the price leads to a movement along the supply curve. If price increases, there is an upward movement up along the supply curve and if there is a decrease in price, there is a movement down the demand curve.
A change in supply is caused by other factors other than price. Some of these factors include :
A change in the number of suppliersThe cost in the price of raw materials needed in the production of the good.A change in supply leads to a movement outward or inward
The Exclusive Gift Company has a monopoly over the sale of gold hula hoops. This company is currently pricing and producing where marginal revenue is equal to marginal cost. It is selling 50 gold hula hoops at a price of $5,000 each. Total costs for the company are $300,000 of which fixed costs are $100,000. You are hired as an economic consultant to this company. You should advise this monopolist to
Answer:
Produce throughout the shorter term but depart the industries run if the circumstances don't start changing because the losses are incurred.
Explanation:
The given values are:
Gold sells,
Q = 50
Price,
= $5000
Total cost,
= $300,000
Fixed cost,
= $100,000
So,
⇒ [tex]TR=5000\times 50[/tex]
⇒ [tex]=250000[/tex] ($)
Now,
⇒ [tex]TVC=300000-100000[/tex]
⇒ [tex]=2000 00[/tex]
So that,
⇒ [tex]AVC=\frac{VC}{Q}[/tex]
On substituting the values, we get
⇒ [tex]=\frac{200000}{50}[/tex]
⇒ [tex]=4000[/tex]
So the above is the correct answer.
Karl works at Moe's grocery. This year Karl was paid $30,000 in salary, but he was allowed to purchase his groceries at 15 percent below Moe's cost. This year Karl spent $2,040 to purchase groceries, costing Moe $2,400. The groceries were worth $3,600. What amount must Karl include in his gross income
Answer:
$30,360
Explanation:
Calculation for What amount must Karl include in his gross income
Gross income amount= [($30,000 + ($2,400 × .15))]
Gross income amount=$30,000 + $360
Gross income amount= $30,360
Therefore the amount that Karl must include in his gross income is $30,360
Crane Company received proceeds of $799000 on 10-year, 9% bonds issued on January 1, 2019. The bonds had a face value of $848000, pay interest annually on December 31, and have a call price of 105. Crane uses the straight-line method of amortization. What is the amount of interest expense Crane will show with relation to these bonds for the year ended December 31, 2020
Answer:
The amount of interest expense Crane will show with relation to these bonds for the year ended December 31, 2020 is $81,220.
Explanation:
This can be calculated as follows:
Annual amortization = (Face value of the bonds - Proceeds from the bonds) / Tenure of the bonds = ($848000 - $799000) / 10 = $49,000 / 10 = $4,900
Interest expenses for 2020 = (Face value of the bonds * Annual interest rate) + Annual amortization = ($848000 * 9%) + $4,900 = $76,320 + $4,900 = $81,220
Therefore, the amount of interest expense Crane will show with relation to these bonds for the year ended December 31, 2020 is $81,220.
Don James purchased a new automobile for $21,000. Don made a cash down payment of $5,250 and agreed to pay the remaining balance in 30 monthly installments, beginning one month from the date of purchase. Financing is available at a 24% annual interest rate.
Required:
Calculate the amount of the required monthly payment.
Answer:
monthly payment. = $703.24 per month
Explanation:
given data
Cost of auto = $21000
Cash Down payment = $5250
Loan amount = PV = 21000-5250
loan amount = $15,750
time period = 30 monthly
Rate = 24% pa = 24÷12 = 2% pm
solution
we get here monthly payment that is express as
monthly payment. = [tex]\frac{P\times r\times (1+r)^n}{(1+r)^n-1}[/tex] ...................1
put here value and we get
monthly payment. = [tex]\frac{15750\times 0.02\times (1+0.02)^{30}}{(1+0.02)^{30}-1}[/tex]
solve it we get
monthly payment. = $703.24 per month
In Marubeni America Corp. v. United States, the federal appellate court ruled that the Nissan Pathfinder was, for tariff classification purposes a motor vehicle for the transport of passengers. The classification of goods is significant because: Question 16 options: A) the fair value will vary depending on the classification B) the subsidy will vary depending on the classification C) the tariffs will vary depending on the classification D) the dumping duty will vary depending on the classification
Answer: the tariffs will vary depending on the classification.
Explanation:
Tariff is a form of tax that is usually imposed on the imports that are brought from other countries to a particular country.
With regards to information provided in the question, the classification of goods is significant because the tariffs will vary depending on the classification.
The sole proprietor of Sam's Swings is interested in gaining a better understanding of his current customers in terms of certain demographic and lifestyle characteristics so he may better serve their needs. For this purpose, he should most appropriately conduct ________ research.
Answer:
Descriptive.
Explanation:
This is explained to be be a form of study that shows to be done in a descriptive manner where it talks about the data analysis, design and form at which the given topic is been solved at the said moment. This is why in the above case, the demographic and lifestyle properties are been ascertained for better conclusions that can drive to the given description. When this is gotten, it will be clearly seen to get a resonable amount ofescription which he require.
9. Two countries: US and Mexico. Two goods: Airplane and car. A US worker's MPL is 20 times higher than a Mexican worker in making an airplane. A US worker's MPL is 5 times higher than a Mexican worker in making a car. Which country has absolute advantage in making cars and why
Answer:
The US has absolute advantage in making cars. An additional worker makes 5 times higher cars than a Mexican worker.
Explanation:
The US has the absolute advantage than Mexico in making both products since its Marginal Product of Labor (MPL) (i.e. the number cars that an additional worker produces) is higher. The US also enjoys absolute advantage because it incurs less cost in making car (or even airplane) than does Mexico in making either car (or even airplane). One can then conclude that the US has the absolute advantage in the making of cars.
The ledger of Columbia, Inc. on March 31, 2014, includes the following selected accounts before adjusting entries.
Debit Credit
Prepaid Insurance 2,240
Supplies 3,120
Equipment 36,000
Unearned Service Revenue 13,600
An analysis of the accounts shows the following.
1. Insurance expires at the rate of $280 per month.
2. Supplies on hand total $960.
3. The equipment depreciates $240 per month.
4. During March, services were performed for two-fifths of the unearned service revenue.
Prepare the adjusting entries for the month of March.
Answer:
Journal 1
Debit : Insurance expense $280
Credit : Prepaid Insurance $280
Being Insurance expense recognized
Journal 2
Debit : Supplies expense $2,160
Credit : Supplies $2,160
Being Supplies Expense Recognized
Journal 3
Debit : Depreciation expense $240
Credit : Accumulated depreciation $240
Being Depreciation expenses recognized
Journal 4
Debit : Unearned Service Revenue $5,440
Credit : Service Revenue Earned $5,440
Being Service Revenue Earned being recognized
Explanation:
Expenses are decreases in income that results as an increase in liabilities and decreases in assets. Note the Decreases in Assets and Increases in Liabilities that have occurred - they represent Expenses which need to be recognized.
Service revenue is recognized when the services are actually performed, thus Reverse the Unearned Service Revenue when services are performed.
A medium sized consulting engineering firm is trying to decide whether it should remodel its office now or wait and do it one year from now. If the firm does it now, the cost will be $38,000. The interest rate is 10% per year. a) What would the cost have to be one year from now to render the decision indifferent
Answer:
next year total cost = $41,800 is the cost to render the decision indifferent.
Explanation:
given data
cost = $38,000
interest rate = 10% per year
time period = 1 year
solution
we get here total cost of remodelling next year that is here
total cost = P + (PNR) ÷ 100 ............1
here P is present cost and N term and R interest rate.
and we take here interest for 1 year first that is
interest = PNR ÷ 100 = 38,000 x 1 x 10 ÷ 100 = $3,800
so as that next year cost will be
next year total cost = 38,000 + 3,800
next year total cost = $41,800 is the cost to render the decision indifferent.
QUESTION 1 Which of the following life insurance policies provides the highest benefit for the lowest premium and is simply a pure death benefit policy? a. Term. b. Whole life. c. Universal life. d. All of the above. a b d
Answer:
the following life insurance policies that provides the highest benefit for the lowest premium and is simply a pure death benefit policy would be A. Term
Analyze the role individual team members and leaders play in ensuring or detracting from team success. In the analysis, considering the advantages and disadvantages of the team effectiveness model (Exhibit 7.2). For example, what would be some of the effective and ineffective individual and leadership behaviors regarding team environmental, design, process, and effectiveness practices
The correct answer to this open question is the following.
Unfortunately, you did not attach the team effectiveness model (Exhibit 7.2). You did not a link or picture of it.
However, trying to help you, we can comment on the following model.
We are going to use the Katzenbach and Smith Team Model.
This team effectiveness model has three important components at the base of the pyramid: collective work product, commitment, and personal growth.
From there, the next level indicates the specific goals of the team, the ground rules, the common approach, and the meaningful purpose of the team.
Going up the pyramid we have the Skills and Accountability.
In the Skills, the authors include interpersonal skills, technical skills, and problem-solving abilities. Regarding Accountability, the authors include mutual and personal accountability.
At the very top of the pyramid, we have the performance results.
This model helps to establish the foundation of the role individual team members and leaders play in ensuring team success.
For this to happen, leaders have to set the example of the n¿behavior they like to observe on team members. On the other hand, setting that example, team members are expected to follow through with the goals and expectations, following high standards of performance to accomplish goals.
Andy, a junior in high school, is considering his options for employment following graduation. His uncle, a master electrician, has suggested that Andy consider an apprenticeship with his company, in part because the occupation is considered a “bright outlook” job and it also is becoming recognized as a “green” industry. Andy’s friend, on the other hand, thinks that Andy should go to work with him at his father’s contracting business as a plaster tender. Andy quickly realizes that the choice he makes at graduation will have long-term effects on his opportunities for career advancement and lifelong income potential. Andy wants to consider many of the factors affecting this important decision, including the education and training needed to begin work, apprenticeship opportunities, licensure requirements, and wages.
Assume the role of Andy’s grandfather who spent his entire career in the building trades and, in an essay of at least 150-words, compare several of the advantages and limitations associated with each career path.
Answer:
Andy should look and identify his field of interest before choosing a specific career path. If she has none of preferences for his career choice then se can look for other factors to select specific career path.
Explanation:
Andy's grandfather has spend his life in building trades and he is a successful person. He thinks Andy should choose same career path as he did and he can be successful too but this is not the case. The thing can be different in this era, the preferences and nature of Andy might be different from his grand father. There are many others factors which also need to be considered as the job security, learning potential in the field, progress in career, wages and pay rise, working environment and others.
Match each term on the left with the best definition on the right. Note: Not all definitions will be used. A detailed record of costs incurred to complete a specific job. A source document that shows how a worker spent time each week. An accounting system used by companies to make standardized or homogeneous products or services. An accounting system used by companies that offer customized or unique products or services. Major inputs that can be directly and easily traced to a product, job or service. Hands-on work that goes into producing a product, job or service. Costs not easily traceable to producing a product, job or service. The amount of actual overhead is greater than the applied overhead. A form that lists the quantity of direct materials to be used in a job. Indirect costs that are allocated to each job. Estimated manufacturing overhead divided by estimated cost driver. A measure that causes or influences the incurrence of a cost. Total cost divided by units produced. The amount of actual overhead is less than the applied overhead. Actual direct materials plus actual direct labor plus applied manufacturing overhead.
Answer:
the answer is the 1st with the 3rd 2nd with the 1st 3th with the 4th and4th with 2nd
Explanation:
i think
Eve Cosmetics Company consists of two departments, Blending and Filling. The Filling Department received 41,400 ounces from the Blending Department. During the period, the Filling Department completed 46,800 ounces, including 7,500 ounces of work in process at the beginning of the period. The ending work in process inventory was 2,100 ounces. How many ounces were started and completed during the period?
Answer:
39,300 ounces
Explanation:
Calculation for How many ounces were started and completed during the period
Using this formula
Numbers of ounces started and completed during the period= Filling Department completed ounces during the period - Work in process at the beginning of the period
Let plug in the formula
Numbers of ounces started and completed during the period=46,800 ounces -7,500 ounces
Numbers of ounces started and completed during the period=39,300 ounces
Therefore How many ounces were started and completed during the period is 39,300 ounces
Aquatic Equipment Corporation decided to switch from the LIFO method of costing inventories to the FIFO method at the beginning of 2018. The inventory as reported at the end of 2017 using LIFO would have been $70,000 higher using FIFO. Retained earnings at the end of 2017 was reported as $880,000 (reflecting the LIFO method). The tax rate is 34%.
Required:
1. Calculate the balance in retained earnings at the time of the change (beginning of 2013) as it would have been reported if FIFO had been used in prior years.
2. Prepare the journal entry at the beginning of 2013 to record the change in accounting principle. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)
Answer:
1. Adjusted net income = Ending inventory higher by amount * (1-Tax rate) = $70,000*(1-34%) = $70,000 * 66% = $46,200
Details Amount
Beginning retained earnings for the year 2017 $880,000
Add: Adjusted net income $46,200
Beginning adjusted retained earnings for year 2017 $926,200
2. Tax payable = Inventory * Tax rate = $70,000*34% = $23,800
Date Account Titles and Explanation Debit Credit
Inventory $70,000
Retained earnings $46,200
Tax payable $23,800
(To record adjustment of ending inventory)
Novak Corp. bought equipment on January 1, 2022. The equipment cost $390000 and had an expected salvage value of $35000. The life of the equipment was estimated to be 5 years. The company uses the straight-line method of depreciation. The book value of the equipment at the beginning of the third year would be
Answer:
$177,000
Explanation:
In order to find the book value of the equipment we need to find the amount of depreciation per year. To do this we need to subtract the salvage value from the initial cost and then simply divide by 5 which is the life span of the equipment...
(390,000 - 35,000) / 5 = x
355,000 / 5 = x
71,000 = x
Now we see that the equipment will depreciate by $71,000 per year. In three years the depreciation would be
71,000 * 3 = 213,000
Now we simply subtract this value from the initial cost to get the book value in the third year
390,000 - 213,000 = 177,000
With gasoline prices at $3.00 per gallon, consumers are flocking to purchase hybrid vehicles (combination of gasoline and electric motors) that get 50 miles per gallon of gasoline. The monthly payment on a three-year lease of a hybrid is $499 compared to $399 per month on a conventional, equivalent traditional gasoline car that gets 25 miles per gallon. Both vehicles require a one-time $1,500 payment for taxes, license, and dealer charges. Both vehicles have identical lease terms for the residual value, maximum number of miles allowed without penalty, and so forth.
Required:
a. Calculate how many miles the consumer must drive per year to make the hybrid the economical choice over the conventional gasoline-only vehicle.
b. How does your answer to part (a) change if the price of gasoline is $4.00per gallon?
Answer and Explanation:
The computation is shown below:
a. The number of miles driven per year is
Let us assume the mileage be M
Now
$499 + M ($3 ÷ 50) = $399 + M ($3 ÷ 25)
$100 = M(0.12 - 0.06)
M = $100 ÷ 0.06
= 1,666.66 miles per month
For year, it is
= 1,666.66 × 12
= 20,000 miles per year
c. Now in the case when the gasoline price is $4 per gallon
$499 + M ($4 ÷ 50) = $399 + M ($4 ÷ 25)
$100 = M(0.16 - 0.08)
M = $100 ÷ 0.08
= 1,250 miles per month
For year, it is
= 1,250 × 12
= 15,000 miles per year
As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 30% of Nursery Supplies Inc.'s 20 million shares for $63 million. The fair value and book value of the shares were the same at that time. During the year, Nursery Supplies earned net income of $40 million and distributed cash dividends of $1.00 per share. At the end of the year, the fair value of the shares is $59 million. Required:Prepare the appropriate journal entries from the purchase through the end of the yea
Answer:
1. Dr Investment in Nursery supplies $63million
Cr Cash $63million
2. Dr Investment in Nursery supplies $12million
Cr Investment Revenue $12million
3. Dr Cash $6million
Cr Investment in Nursery supplies $6million
4. No Entry
Explanation:
Preparation of the appropriate journal entries from the purchase through the end of the yea
1. Preparation of the journal entry to Record the investment in Nursery Supplies shares.
Dr Investment in Nursery supplies $63million
Cr Cash $63million
(Being To record purchase of 30% shares for $63 million)
2. Preparation of the journal entry to Record the investor's share of net income
Dr Investment in Nursery supplies ($40 million x 30%) $12million
Cr Investment Revenue $12million
(Being To record investor share of investee's net income)
3. Preparation of the journal entry to Record the cash dividends received from Nursery Supplies shares.
Dr Cash (20 million shares x 30% share x $1 per share) $6million
Cr Investment in Nursery supplies $6million
(Being To record receipt of dividend)
4. Preparation of the journal entry to Record fair value adjustment at year-end.
No Entry