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.
An entrepreneur recently purchased Cocoon's, a local deli, on the beach. To operate the business, she estimates that selling and administrative expenses will be $98,510.00 per year and that depreciation will be $20,000.00 per year. As part of her purchase, she took out a bank loan that will require $76,265.00 per year in interest. She anticipates paying a 32.00% tax rate on income. She estimates that the deli will attract 200.00 customers per day. Each customer will spend $12.00 on average. The cost of goods per customer will be $4.50. She will operate the deli 350.00 days per year. What is the projected net profit margin for the deli
Answer:
27%
Explanation:
The computation of the net profit margin is shown below;
As we know that
net profit margin = Net profit ÷ sales
where
net profit is
Particulars Amount
Sales (200 customers × $12 × 350 days) $840,000
Less: cost of goods sold (200 customers × $4.50 × 350 days) -$315,000
Gross profit $525,000
Less:
Selling and admin expense -$98,510
Depreciation expense - $20,000
Bank loan interest -$76,265
Net income before tax $330,225
Less tax at 32% -$105,672
Net income after tax $224,553
Now the net profit margin is
= $224,553 ÷ $840,000
= 27%
The Commonwealth of Virginia filed suit in October 2019 against Northern Timber Corporation, seeking civil penalties and injunctive relief for violations of environmental laws regulating forest conservation. When the 2020 financial statements were issued in 2021, Northern had not reached a settlement with state authorities, but legal counsel advised Northern Timber that it was probable the ultimate settlement would be $1,056,000 in penalties. The following entry was recorded:
Loss-litigation 1,650,000
Liability-litigation 1,650,000
Late in 2016, a settlement was reached with state authorities to pay a total of $1,120,000 to cover the cost of violations.
Required:
1. Prepare any journal entries related to the change.
2. Would a disclosure note be required for the change in estimate?
Answer:
Dr Liability - Litigation 530,000
Cr Gain - Litigation 530,000
Explanation:
Preparation of any journal entries related to the change.
Based on the information given journal entries related to the change will be:
Dr Liability - Litigation 530,000
Cr Gain - Litigation 530,000
(1,650,000-$1,120,000)
Batch Co. employs knowledge workers and is finding that its employees are retiring closer to age 75 than to age 65. As a result, they recently amended their defined benefit pension plan such that benefits will begin at age 72, with certain exceptions for those employees demonstrating an earlier need, instead of at age 60. Batch Co. has been able to measure the actuarial present value of this amendment, which is the change in the projected benefit obligation (PBO) that results from the change. How will this affect pension expense in current and future periods?
Answer:
It will decrease prior service cost and, as prior service cost is amortized, will decrease pension expense.
Explanation:
In the given if there is any change in the projected benefit obligation so the pension expense would impact in the present and future period by reducing the service cost that incurred before also the service cost that incurred before would be amortized that ultimately reduce the pension expense
Therefore the first option is correct
Sales revenue $944,200 Less: Cost of goods sold 598,100 Gross profit 346,100 Less: Operating expenses (includes depreciation expense and bad debt expense) 248,500 Income from operations 97,600 Other revenues and expenses Gain on sale of investments $14,900 Loss on sale of equipment (2,900 ) 12,000 Income before taxes 109,600 Income taxes 45,200 Net income $64,400 (a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities
Answer:
$500
Explanation:
Net cash flow from operating activities is $500
in one paragraph describe the general advantages and drawbacks of the premium pricing strategy.For exapmle, explain where it falls on the intersection of quality and price.
Please dont copy paste from the internet, will be flagged.
Answer:
The main advantage resulting from a premium pricing strategy is the higher profits. Another advantage is that customers that purchase premium products seek higher quality and tend to show higher brand loyalty associated with the status of using premium products. The disadvantages of premium pricing are that it cannot be applied to all products, the marketing efforts tend to be more specific, and therefore, represent a higher percentage of sales, and finally, not everyone is willing to pay premium prices.
A stress test in finical marketing means:_____.
A. Aims to test the behavior of historical returns and their fluctuations during all sorts of potential financial crises.
B. Does not look at historical returns, and looks at all the details of the portfolios and their vulnerabilities during all sorts of potential financial crises.
C. Tries to incorporate all potential economic and financial crises, such as recessions, appreciation and depreciation of currency, liquidity crisis, etc.
D. Tries to incorporate all the interconnections between financial institutions.
Answer:
C.
Explanation:
Stress tests are carried out to determine how financial systems would react in periods of extreme stress eg. financial or economic crisis.
Stress situations are simulated and the reaction of the financial system to the stress is measured. Based on the reactions of the financial system, steps are taken to further improve or strengthen the financial system.
The scenarios used in a stress test can be based on historical events (events that have already occurred) or hypothetical events.
18 month rent was paid at year end how will this effect the balance sheet
Answer:
Explanation:
The correct answer to your questions is letter A. Assets will be decreased.
Which challenge leads to development of incorrect features and functionalities in IS?
A.
end user resistance
B.
quality issues
C.
lack of documentation
D.
project completion constraints
Answer:D
Explanation:
Outline the process the raw ingredients for a single flavor of ice cream might undergo to get to a local grocery’s freezer case.
Answer: fermenting , shredding , pasteurizing
Sweet Shop Co. is a chain of candy stores that has been in operation for the past ten years. For each of the following transactions give the accounting effects of the adjustments required. (Enter any decreases to account balances with a minus sign.)
a. Ordered and received $12,300 worth of cotton candy machines from Candy Makers Inc., which Sweet Shop Co. will pay for in 45 days.
b. Sent a check for $6,300 to Candy Makers Inc. for the cotton candy machines from (a).
c. Received $700 from customers who bought candy on account in previous months.
d. To help raise funds for store upgrades estimated to cost $36,500, Sweet Shop Co. issued 1,300 common shares for $25 each to existing stockholders.
e. Sweet Shop Co. bought ice cream trucks for $66,000 total, paying $13,000 cash and signing a long-term note for $53,000.
Answer:
Sweet Shop Co.
Accounting Effects of Transactions:
a. Ordered and received $12,300 worth of cotton candy machines from Candy Makers Inc., which Sweet Shop Co. will pay for in 45 days.
Assets (Equipment +$12,300) = Liabilities (Accounts Payable +$12,300) + Equity
b. Sent a check for $6,300 to Candy Makers Inc. for the cotton candy machines from (a).
Assets (Cash -$6,300) = Liabilities (Accounts payable -$6,300) + Equity
c. Received $700 from customers who bought candy on account in previous months.
Assets (Cash +$700) = Liabilities + Equity (Retained Earnings +$700)
d. To help raise funds for store upgrades estimated to cost $36,500, Sweet Shop Co. issued 1,300 common shares for $25 each to existing stockholders.
Assets (Cash +$32,500) = Liabilities + Equity (Common stock +$32,500)
e. Sweet Shop Co. bought ice cream trucks for $66,000 total, paying $13,000 cash and signing a long-term note for $53,000.
Assets (Trucks +$66,000; Cash -$13,000) = Liabilities (Long-term note payable +$53,000) + Equity
Explanation:
The accounting effects of transactions show how the accounting equation will always remain in balance given each transaction's double-entry effects.
How do state and federal courts differ in the United States?
Answer:The primary distinction is that state and local courts are authorized to hear cases involving the laws and citizens of their state or city, while federal courts decide lawsuits between citizens of different states, cases against the United States, and cases involving specific federal laws.
Explanation:
In the context of using information technologies for a competitive advantage, which statement is true of a top-line strategy? a. It focuses on generating new revenue by offering new products and services. b. It focuses on improving efficiency by reducing overall costs. c. It focuses on helping different market segments achieve technological advancement. d. It focuses on refining operations by using latest technologies.
Answer:
a. It focuses on generating new revenue by offering new products and services.
Explanation:
An information system or technology can be defined as a set of components or computer systems, which is used to collect, store, and process data, as well as dissemination of information, knowledge, and distribution of digital products. Thus, an information system or technology interacts with its environment by receiving data in its raw forms and information in a usable format.
Information technology is an integral part of human life because individuals, organizations, and institutions rely on information technologies in order to perform their duties, functions or tasks and to manage their operations effectively. For example, all organizations make use of information systems for supply chain management, process financial accounts, manage their workforce, and as a marketing channels to reach their customers or potential customers.
Additionally, an information system comprises of five (5) main components;
1. Hardware.
2. Software.
3. Database.
4. Human resources.
5. Telecommunications.
Hence, in the context of using information technologies for a competitive advantage over rivals in the industry, the statement which is true of a top-line strategy is that, it focuses on generating new revenue by offering new products and services. The top-line strategy ensures that the company continues to generate gross revenue or sales.
Yi Min started an engineering firm called Min Engineering. He began
operations and completed seven transactions in May, which included his initial investment of $19,500 cash. After those seven transactions, the ledger included the following accounts with normal balances.
Cash$46,789
Office supplies 940
Prepaid insurance 4,100
Office equipment 13,500
Accounts payable 13,500
Common stock 19,500
Dividends 3,191
Engineering fees earned 43,000
Rent expense 7,480
The following seven transactions produced the account balances shown above.
A. Y. Min invested $19,500 cash in the business in exchange for common stock.
B. Paid $7,480 cash for monthly rent expense for May.
C. Paid $4,100 cash in advance the annual for insurance premium beginning the next period.
D. Purchased office supplies for $940 cash.
E. Purchased $13,500 of office equipment on credit (with accounts payable).
F. Received $43,000 cash for engineering services provided in May.
G. The company paid $3,191 cash in dividends.
Question Completion:
Prepare a trial balance for the month of May and a Cash T-account, showing the cash balance.
Answer:
Yi Min
1. Trial Balance as of May 31,
Account Details Debit Credit
Cash $46,789
Office supplies 940
Prepaid insurance 4,100
Office equipment 13,500
Accounts payable $13,500
Common stock 19,500
Dividends 3,191
Engineering fees earned 43,000
Rent expense 7,480
Totals $76,000 $76,000
2. Cash Accounts
Account Details Debit Credit
Common stock $19,500
Rent $7,480
Prepaid Insurance 4,100
Office supplies 940
Engineering fees 43,000
Dividends 3,191
Balance $46,789
Totals $62,500 $62,500
Explanation:
a) Data and Calculations:
Cash$46,789
Office supplies 940
Prepaid insurance 4,100
Office equipment 13,500
Accounts payable 13,500
Common stock 19,500
Dividends 3,191
Engineering fees earned 43,000
Rent expense 7,480
b) Yi Min's trial balance lists all the general ledger accounts (both revenue and capital) of a business at the end of May. This list is made up of the Account Titles of each nominal ledger account and the value of that ledger balance as either a debit balance or a credit balance. The two sides are expected to be in agreement, otherwise, an error in posting could have occurred.
c) The Cash account is the general ledger where all cash transactions are posted and summarized in order to determine the balance at the end of the period. It records the cash receipts and the cash payments.
a) Calculate the PV of a perpetuity with a cash flow of $111,111 received every year. The first cash flow occurs in year 1. The interest rate is 11% simple annual rate. b) Calculate the PV of a perpetuity with a cash flow of $222,222 received every second year. The first cash flow occurs in year 2. The interest rate is 11% simple annual rate. c) Calculate the PV of a perpetuity with a cash flow of $333,333 received every third year. The first cash flow occurs in year 3. The interest rate is 11% simple annual rate.
Answer:
a) Calculate the PV of a perpetuity with a cash flow of $111,111 received every year. The first cash flow occurs in year 1. The interest rate is 11% simple annual rate.
PV of a perpetuity = annual payment / interest rate = $111,111 / 11% = $1,010,100
b) Calculate the PV of a perpetuity with a cash flow of $222,222 received every second year. The first cash flow occurs in year 2. The interest rate is 11% simple annual rate.
PV of a perpetuity = annual payment / interest rate = $222,222 / (11% x 2) = $1,010,100
c) Calculate the PV of a perpetuity with a cash flow of $333,333 received every third year. The first cash flow occurs in year 3. The interest rate is 11% simple annual rate.
PV of a perpetuity = annual payment / interest rate = $333,333 / (11% x 3) = $1,010,100
Explanation:
Since the interest rate is simple, not compounded, the three perpetuities have the same present value.
Tootsie Roll Industries is engaged in the manufacture and sale of candy. Major products include Tootsie Roll, Tootsie Roll Pops, Tootsie Pop Drops, Tootsie Flavor Rolls, Charms, and Blow-Pop lollipops. The following items were listed on Tootsie Roll's recent income statement and balance sheet. Select each item from the balance sheet as an asset (A), liability (L), or shareholders' equity (SE) item and each item from the income statement as a revenue (R) or expense (E) item.
a. Bank loans
b. Selling, marketing, and administrative expenses
c. Accounts payable
d. Dividends payable
e. Retained earnings
f. Cash and cash equivalents
g. Accounts receivable
h. Provision for income taxes
i. Product cost of goods sold
j. Machinery and equipment
k. Net product sales
l. Inventories
m. Trademarks
n. Buildings
o. Land
p. Income taxes payable
q. Rental and royalty costs
r. Investments (in other companies)
Answer:
Balance Sheet
a. Bank loans ( L )
c. Accounts payable ( L )
d. Dividends payable ( L )
e. Retained earnings ( SE )
f. Cash and cash equivalents ( A )
g. Accounts receivable ( A)
h. Provision for income taxes ( L )
j. Machinery and equipment ( A )
l. Inventories ( A )
m. Trademarks ( A )
n. Buildings ( A )
o. Land ( A )
p. Income taxes payable ( L )
r. Investments (in other companies) ( A )
Income Statement
b. Selling, marketing, and administrative expenses ( E )
i. Product cost of goods sold ( E )
k. Net product sales ( R )
q. Rental and royalty costs ( E )
Explanation:
All the Assets, Liabilities, and Shareholder's equity are part of the balance sheet so, these are classified under the Balance sheet as A, L, and SE respectively.
Revenue and Expesne are incorporated in the income statement to calculate the net income for the period. Both of these are classified under the income statement as R and E respectively.
All those items over which the business has control and the right to receive an economic benefit from it are defined as assets. e.g Land
All the item which represents the obligation for the business to be fulfilled in future is classified as liabilities. e.g Bank loan
All the items associated with the shareholders of the company are classified as shareholder's equity. e.g Retained Earnings.
All the items which show the income for the flow of the economic benefit for the business are considered as Revenue. e.g Net sales.
All the items show the costs incurred to receive the benefit for the business are classified as the expense. e.g Rental expenses
Anson Dorrance, the coach of the UNC women’s soccer team, has an eye for scouting outstanding talent for the development of his team. He makes sure to engage the best person for the position in order to develop a well-rounded team. In business language, this practice is called
Answer:
Selective hiring
Explanation:
The selective hiring means the hiring of candidates from the particular group that have some particular knowledge and skill set for the job available.
Since in the question it is mentioned that coach wants to engage the best person for the position available so this represent the selective hiring
And, the above situation represent the answer
PCM Thermal Products uses austenitic nickel-chromium alloys to manufacture resistance heating wire. The company is considering a new annealing-drawing process to reduce costs. If the new process will cost $3.25 million dollars now, how much must be saved each year to recover the investment in 6 years at an interest rate of 15% per year
Answer:
the amount that need to be saved each year in order to recover the investment is $858,770
Explanation:
The computation of the amount saved each year is shown below:
= Costing of the new process × (A/P, 15%, 6)
= $3,250,000 × 0.26424
= $858,770
hence, the amount that need to be saved each year in order to recover the investment is $858,770
On January 1, James Company reported total current assets of $658,000 and total current liabilities of $365,000. During the year, James purchased $2,000 worth of equipment for cash, paid $560 towards salaries, and borrowed $80,000 from its bank to be repaid after 5 years. How much working capital does the company have as of December 31
Answer:
$370,440
Explanation:
The computation of the working capital is as follows:
As we know that
Working capital = Current asset - current liabilities
where,
Current Assets is
= Total current assets - purchase of an equipment - salaries - borrowed amount
= $658,000 - $2,000 - $560 + $80,000
= $735,440
And, Current Liabilities is $365,000
So, the working capital is
= $735,440 - $365,000
= $370,440
Under IAS 12, current and deferred taxes are measured on the basis of: rates prevailing when the entity provided goods or services. rates that have been enacted or substantively enacted by the balance sheet date. rates anticipated when temporary differences reverse. current rates and rates anticipated when temporary differences reverse.
Answer:
Under IAS 12, current and deferred taxes are measured on the basis of:
rates anticipated when temporary differences reverse.
Explanation:
According to IAS 12, the measurement of the deferred tax assets and deferred tax liabilities are based on the expected tax rate when the underlying asset or liability is recovered or settled. Deferred taxes arise from the temporary or timing differences between the carrying amount of an asset or liability in the financial statement and the tax base.
A Student table and an Address table contain one linked record. What kind of table relationship do these tables
demonstrate?
a. one-to-one
b. one-to-many
c. many-to-many
d. many-to-none
Answer:
A.)
Explanation:
hope this helps
Compute the taxable income for 2020 for Aiden on the basis of the following information. Aiden is married but has not seen or heard from his wife since 2018.
Salary $80,000
Interest on bonds issued by City of Boston 3,000
Interest on CD issued by Wells Fargo Bank 2,000
Cash dividend received on Chevron common stock 2,200
Life insurance proceeds paid upon death of aunt
(Aiden was the designated beneficiary of the policy) 200,000
Inheritance received upon death of aunt 100,000
Jackson (a cousin) repaid a loan Aiden made to
him in 2014 (no interest was provided for) 5,000
Itemized deductions (state income tax,
property taxes on residence, interest
on home mortgage, and charitable contributions) 9,700
Number of dependents
(children, ages 17 and 18, and mother-in-law, age 70) 3
Age 43
Required:
a. Indicate whether the items are taxable or not taxable to Aiden.
b.What is Aiden's filing status?
c. Should Aiden itemize his deductions or take the standard deduction?
d. Aiden's taxable income in 2018 is $________
Solution :
a). The following items are :
Salary ---- taxable
Cash dividend that is received on common stock of Chevron -- Taxable
The Interest on the bonds that is issued by Boston City --- Not taxable
The proceeds of Life Insurance --- Not taxable
The interest on the CD that is issued by the Wells Fargo Bank -- Taxable
The Inheritance which is received on the death of Aunt Margie --- Not taxable
The Proceeds from repayment of the loan ---- Not taxable
b). Aiden's filing status is Head of households.
c). Aiden should take the standard deductions.
d). Aiden's taxable income in 2018 :
Cash dividend that is received on the Chevron common stock $ 2,200
Salary $ 80,000
Interest on the CD issued by the Wells Fargo Bank $ 2,000
AGI $ 84,200
Less : standard deduction $ 18,000
Taxable income $ 66,200
Transactions for the Bridgeport Company, which provides welding services, for the month of June are presented as follows.
June 1 Bridgeport invests $4,180 cash in exchange for shares of common stock in a small welding business.
2 Purchases equipment on account for $1,070.
3 $740 cash is paid to landlord for June rent.
12 Bills P. Leonard $370 after completing welding work done on account.
Required:
Journalize the transactions.
Answer:
Explanation: see attached
During January, Year 2, Geo entered into the following transactions: Paid $728 on account for utilities that were used during December, Year 1. Purchased $488 of supplies for cash. Signed a rental agreement for office space and paid $6,100 in advance for six months of rent beginning February 1, Year 2. Purchased $21,000 of new equipment, signing a promissory note. Provided $32,500 of services. $16,000 was received in cash and $16,500 was provided on credit. Paid workers $7,400 for work done in January. Required: Prepare journal entries for each of the following January activities, and post results to the relevant T-accounts. Compute the ending balance of each T-account. Beginning balances have been entered.
Answer:
Geo
1. Journal Entries:
1. Debit Utilities Payable $728
Credit Cash $728
To record the payment of utilities on account.
2. Debit Supplies $488
Credit Cash $488
To record the purchase of supplies for cash.
3. Debit Prepaid Rent $6,100
Credit Cash $6,100
To record the prepayment of rent for 6 six months.
4. Debit Equipment $21,000
Credit Note Payable $21,000
To record the purchase of equipment on account.
5. Debit Cash $16,000
Debit Accounts Receivable $16,500
Credit Services Revenue $32,500
To record the rendering of services for cash and on account.
6. Debit Salaries Expense $7,400
Credit Cash $7,400
To record the payment of salaries for January.
2. T-accounts:
Utilities Payable
Accounts Titles Debit Credit
Cash $728
Cash
Accounts Titles Debit Credit
Utilities payable $728
Supplies 488
Prepaid Rent 6,100
Service Revenue $16,000
Salaries Expense 7,400
Supplies
Accounts Titles Debit Credit
Cash $488
Prepaid Rent
Accounts Titles Debit Credit
Cash $6,100
Equipment
Accounts Titles Debit Credit
Note Payable $21,000
Note Payable
Accounts Titles Debit Credit
Equipment $21,000
Accounts Receivable
Accounts Titles Debit Credit
Service Revenue $16,500
Services Revenue
Accounts Titles Debit Credit
Cash $16,000
Accounts Receivable 16,500
Salaries Expense
Accounts Titles Debit Credit
Cash $7,400
Explanation:
Since the beginning balances were not supplied, the T-accounts are not balanced at the end of the period. Journal entries were prepared to record the daily business transactions for the first time in the accounting system. The entries showed the accounts to be debited and credited respectively.
The following data relate to the Torrence Company for May and August:
May August
Maintenance hours 25000 29,000
Maintenance cost $1175,000 $1247,000
May and August were the lowest and highest activity levels, and Torrence uses the high-low method to analyze cost behavior. If maintenance hours are estimated to be 26,000 hours in October, which of the following statements is true?
a. The variable maintenance cost is $24 per hour.
b. The fixed maintenance cost is $72,000 per month.
c. More than one of the other answers is true.
d. The variable maintenance cost is $22 per hour.
e. The variable maintenance cost is $18 per hour.
Answer:
Variable cost per unit= $18 per unit
Explanation:
First, we need to calculate the unitary and fixed costs under the high-low method:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (1,247,000 - 1,175,000) / (29,000 - 25,000)
Variable cost per unit= $18 per unit
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 1,247,000 - (18*29,000)
Fixed costs= $725,000
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 1,175,000 - (18*24,000)
Fixed costs= $725,000
Total cost= 725,000 + 18*x
x= number of hours
For 26,000:
Total cost= 725,000 + 18*26,000
Total cost= $1,193,000
Reese Inc., a provider of consulting services, was founded on October 1, 2022. At the end of the first month of operations, the company decided to prepare an income statement, retained earnings statement, and balance sheet using the following information. Prepare an income statement, retained earnings statement, and balance sheet. Accounts payable $ 3,300 Supplies $ 2,460 Interest expense 410 Supplies expense 380 Equipment (net) 48,200 Depreciation expense 270 Salaries and wages expense 2,500 Service revenue 20,920 Bonds payable 21,500 Salaries and wages payable 445 Unearned service revenue 4,065 Common stock 9,100 Accounts receivable 1,300 Interest payable 140 Cash 3,950 Instructions Using the information, prepare an income statement and retained earnings statement for the month of October 2022 and a balance sheet as of October 31, 2022. End. retained earnings $17,360
Answer and Explanation:
The preparation of the income statement, retained earnings, and the balance sheet is presented below:
Income statement
Service revenue $20,920
Less: expenses
Salaries & wages expense -$2,500
Interest expense -$410
Depreciation expense -$270
Supplies expense -$380
Total expense -$3,560
Net income $17,360
Retained earnings
Opening retained earnings balance $0
Add: net income $17,360
Ending retained earnings balance $17,360
Balance sheet
Assets
cash $3,950
Accounts receivable $1,300
Supplies $2,460
Equipment ,net $48,200
total assets $55,910
Liabilities and Stockholders Equity
liabilities:
Accounts payable $3,300
unearned service revenue $4,065
Salaries and wages payable $445
interest payable $140
Bonds payable $21,500
total liabilities $29,450
Stockholders equity:
Common stock $9,100
Retained earnings $17,360
total stockholders equity $26,460
total liabilities & stockholders equity $55,910
Problem 8-12 (Algo) A firm uses a serial assembly system and needs answers to the following: a. An output of 800 units per shift (8.00 hours) is desired for a new processing system. The system requires product to pass through four stations where the work content at each station is 32 seconds. What is the required cycle time for such a system
Answer:
the required time is 36 seconds
Explanation:
The computation of the required time is given below:
= Production time available ÷ desired output
= (8 hours × 60 minutes × 60 seconds) ÷ 800 units
= 28,800 ÷ 800
= 36 seconds
hence, the required time is 36 seconds
Indiana Co. began a construction project in 2018 with a contract price of $160 million to be received when the project is completed in 2020. During 2018, Indiana incurred $39 million of costs and estimates an additional $83 million of costs to complete the project. Indiana recognizes revenue over time and for this project recognizes revenue over time according to the percentage of the project that has been completed.
A. Recognized no gross profit or loss on the project in 2018.
B. Recognized $12.37 million gross profit on the project in 2018.
C. Recognized $78.00 million loss on the project in 2018.
D. Recognized $39.00 million loss on the project in 2018.
Answer:
Recognized $12.47 million gross profit on the project in 2018.
Explanation:
Total Contract price $160
Total cost incurred during the year 2018 $39
Additional cost $83
Total cost $122
Total profit $38
% cost during the year = (39/122*100) = 31.9672131147541% = 31.97%
Revenue recognized on 2018 = 39*31.97% = $12.4683 = $12.47
Headland Inc. issued $4,130,000 of 11%, 10-year convertible bonds on June 1, 2020, at 98 plus accrued interest. The bonds were dated April 1, 2020, with interest payable April 1 and October 1. Bond discount is amortized semiannually on a straight-line basis. On April 1, 2021, $1,548,750 of these bonds were converted into 24,000 shares of $21 par value common stock. Accrued interest was paid in cash at the time of conversion. (a) Prepare the entry to record the interest expense at October 1, 2020. Assume that accrued interest payable was credited when the bonds were issued. (b) Prepare the entry to record the conversion on April 1, 2021. (Book value method is used.) Assume that the entry to record amortization of the bond discount and interest payment has been made.
Answer:
A. Dr Interest Payable $75,717
Dr Interest expense $154,233
Cr Discount on Bonds payable $2,800
Cr Cash $227,150
B. Dr Bonds payable $1,548,750
Cr Discount on Bonds payable $28,350
Cr Common Stock$504,000
Cr Paid-in capital in excess of par- Common Stock $1,073,100
Explanation:
(a) Preparation of the entry to record the interest expense at October 1, 2020. Assume that accrued interest payable was credited when the bonds were issued.
Dr Interest Payable $75,717
[($4,130,000*0.11)/2*(2/6)]
Dr Interest expense $154,233
[($4,130,000*.11)/2*(4/6) + $2,800]
Cr Discount on Bonds payable $2,800
($700*4)
Cr Cash $227,150
[ ( $4,130,000*.11)/2]
Calculation for the discount per month
First step is to calculate the remaining months
Months remaining= (10 years *12-2)
Months remaining=118 months
Second step is to calculate the Total discount
Total Discount=$4,130,000-($4,130,000*.98)
total discount=$4,130,000-$4,047,400
total discount=$82,600
Now let calculate the discount per month
Discount per month=($82,600/118)
Discount per month=$700
(b) Preparation of the entry to record the conversion on April 1, 2021
Dr Bonds payable $1,548,750
Cr Discount on Bonds payable $28,350
Cr Common Stock$504,000
(24,000*$21)
Cr Paid-in capital in excess of par- Common Stock $1,073,100
[$1,548,750+$28,350-($504,000)]
Calculation for Unamortized bond discount
Discount of the bonds $30,975
($82,600*(3/8))
Less Discount amortized ($2,625)
[($82,600/118)*10 years*(3/8)]
Unamortized bond discount $28,350
($30,975-$2,625)
Robbie is a 20 year old dependent who is a full time student. Robbie has $6,800 in income from wages and $6,000 of interest income from bonds inherited from his grandmother. What is the amount of Robbie's Taxable Income
Answer:
$5,650
Explanation:
Calculation for What is the amount of Robbie's Taxable Income
Wages $6,800
Add Interest Income $6,000
= Adjusted Gross Income $12,800
($6,800+$6,000)
Less Standard Deduction ($7,150)
Taxable Income $5,650
($12,800-$7,150)
Therefore the amount of Robbie's Taxable Income is $5,650
The statement of cash flows shows the following information: Cash provided by operating activities of $18,200 Cash used by investing activities of $6,700 Cash used by financing activities of $1,200 The beginning cash was $17,100. What is the amount of cash at the end of the period
Answer:
$27,400
Explanation:
The amount of cash at the end of the period is calculated as;
Cash provided by operating activities
$18,200
Cash used by investing activities
($6,700)
Cash used by financing activities
($1,200)
Net increase (decrease) in cash balance
(a) $10,300
Cash at the beginning of the year
(b) $17,100
Cash at the end of the year
c = (a) + (b) = $27,400