Using the following information, prepare a bank reconciliation for Oriole Company for July 31, 2022. a. The bank statement balance is $3,760. b. The cash account balance is $4,000. c. Outstanding checks totaled $1,450. d. Deposits in transit are $1,600. e. The bank service charge is $63. f. A check for $85 for supplies was recorded as $58 in the ledger.
Answers
Answer:
See photo. I am a professional so my format may be different than what school tells you. Hopefully you can use this information.
Explanation:
Related Questions
In October, Pine Company reports 18,200 actual direct labor hours, and it incurs $217,000 of manufacturing overhead costs. Standard hours allowed for the work done is 21,700 hours. The predetermined overhead rate is $10.15 per direct labor hour. In addition, the flexible manufacturing overhead budget shows that budgeted costs are $8.45 variable per direct labor hour and $43,100 fixed.
Required:
Compute the overhead controllable variance.
Answers
Answer:
$7,295 ( favourable)
Explanation:
According to the scenario, computation of the given data are as follows,
Actual direct labor hours = 18,200
Manufacturing OH cost = $217,000
Standard hours allowed = 21,700
Budgeted cost = $8.45
Budgeted fixed cost = $43,100
So, we can calculate overhead controllable variance by using following formula,
Overhead controllable variance = Budgeted OH (actual ) - Actual manufacturing Overhead
Where, Budgeted OH (actual ) = (21,700 × $8.35) + $43,100 = $224,295
By putting the value in the formula, we get
Overhead controllable variance = $224,295 - $217,000
= $7,295 ( favourable)
Orion Flour Mills purchased a new machine and made the following expenditures: Purchase price $56,000
Sales tax 5,050
Shipment of machine 810
Insurance on the machine for the first year 510
Installation of machine 1,620
The machine, including sales tax, was purchased on account, with payment due in 30 days. The other expenditures listed above were paid in cash.
Required:
Record the above expenditures for the new machine.
Answers
Answer:
Debit : Machine $58,430
Debit : Insurance expense $510
Debit : Sales tax $5,050
Credit : Cash $63,990
Being Cost of machine recognized as well as other expenses on the machine
Explanation:
The cost of the machine includes the purchase price plus any costs directly incurred in putting the asset in the location and condition indented by the management.
Cost of Machine is calculated as :
Purchase price $56,000
Shipment of machine $810
Installation of machine $1,620
Total $58,430
Other Costs are recognized as expenses in the income statement and not as part of the asset.
One day, Barry the Barber, Inc., collects $400 for haircuts. Over this day, his equipment depreciates in value by $50. Of the remaining $350, Barry sends $30 to the government in sales taxes, takes home $220 in wages, and retains $100 in his business to add new equipment in the future. From the $220 that Barry takes home, he pays $70 in income taxes.
a. gross domestic product
b. net national product
c. national income
d. personal income
e. disposable personal income
Answers
Answer: See explanation
Explanation:
a. gross domestic product
The GDP is $400 which is the money that Barry collects for haircut.
b. net national product
Net National Product:
= GDP – Depriciation
= $400 - $50
= $350
c. national income
The national income is the total income that the residents of the country earns and this will be same as Net National Product which is $350
d. personal income
Personal income:
= National income – Retained earnings
= $350 - $100 - $30
= $220
e. disposable personal income
Disposable personal income:
= Personal income – Personal tax
= $220 - $70
= $150
A country is angry at a neighboring country for creating too much water and
air pollution. It passes a law that forbids its citizens from doing any business
with the other country until that country cleans up the pollution. If the
pollution continues, there will be no trade between the countries.
This is an example of which type of trade barrier?
A. Tariffs
B. Embargoes
C. Subsidies
D. Quotas
Answers
The trade barrier which is displayed is called as Embargoes. Hence, Option B is the correct statement.
What do you mean by Embargoes?An embargo is a central authority order that restricts trade or alternates with a precise country, commonly due to political or financial problems.
An embargo is commonly created due to damaging political or financial occasions among nations. It is designed to isolate a rustic and create problems for its governing body, forcing it to behave on the difficulty that brought about the embargo.
Hence, Option B is the correct statement.
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In June 2000, the SEC brought civil charges against seven top executives of Cendant Company. The SEC alleged that these officials had, among other things, inflated income by more than $100 million through improper use of company reserves. These proceedings were a result of a longstanding investigation by the SEC of financial fraud that started back in the 1980s. In your opinion, in which stage of the criminal litigation process is this case? Why?
Answers
Answer:
First stage
Explanation:
Filing of criminal charges against an offender is usually the first stage in a criminal litigation process. The investigation carried out by SEC is a preliminary process and may not be counted as First stage.
The criminal litigation process is made up seven ( 7 ) process and the investigative part of the process is to Identify the civil charges
What amount should be paid on the maturity date to settle a one-hundred-twenty day loan dated March 19, 2013, if the present value is ₱15,600 at 13 2/7% simple interest?
A. ₱690.86
B. ₱16,290.86
C. ₱16,281.39
D. ₱681.39
Answers
Answer:
c
Explanation:
what happens in your retirement if you have a lapse in your years of work history?
Answers
Your monthly benefit will be lower
A lapse in your years of work history refers, There are generally the four ways by which we can handle it, various points are as leave it where it is, and the second point refers that, roll it over an ira.
What is employment?In most cases, employment refers to the status of having a paid job—of being employed. Employing someone is paying them to work. Employees are employed by an employer. Employment can also refer to the act of hiring individuals, as in We're trying to hire more women.
The employment lapse refers that, The working period of an employee and, The commencing of the individual's termination from the service date. He can continue to begin the performance services as an employee.
Therefore. As a result, The ends of the benefits, or the privileges are been applicable under a policy.
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Zeffer is a small but growing bottling company that competes with large soft drink heavy-hitters. To set itself apart, Zeffer has decided to develop a line of all-natural soft drinks that are believed to be healthier than typical high-calorie sodas. The company hopes that these soft drinks will become popular in various sectors of the U.S. market. Answer the following question based on the scenario described above. Zeffer executives have decided to focus marketing efforts on the ________ market, since this group is expected to grow more rapidly than
Answers
Answer:
Hispanic
Explanation:
In the United States Hispanic population has continued to be responsible for half of the total population growth since 2010 till date.
In this time Hispanics contributed 52% to the 18.9 million population growth in the United States.
Based on this trend Zeffer has decided to develop a line of all-natural soft drinks that are believed to be healthier than typical high-calorie sodas and targeting the Hispanic market will make their product popular rapidly.
A firm has the following account balances for this year. Sales for the year are $500,000. Projected sales for next year are $545,000. The percentage of sales approach is used for pro forma purposes. All balance sheet accounts, except long-term debt and common stock, change according to that approach. The firm plans to decrease the long-term debt balance by $5,000 next year. Retained earnings is expected to increase by $3,500 next year. What is the projected external financing need?
a) $10,520
b) $14,720
c) $18,520
d) $20,720
e) $25,620
Answers
Answer:
b) $14,720
Explanation:
Note: The missing words are attached below for understanding
Determining the increase in the sales:
Percentage increase in sales = (New sales - Old sales) / Old sales
= ($545,000 - $500,000) / $500,000
= 9%
Determining the new balances of assets and liabilities:
Current assets = $48,000*109% = $52,320
Fixed assets = 158000*109% = $172,220
Total assets = $52,320 + $172,220 = $224,540
Financed by:
The current liabilities = $48000*109% = $52,320
Long-term debt = $83,000 - $5,000 = $78,000
Common stock = $36,000
Retained earnings = $40,000 + $3,500 = $43,500
Total liabilities & the equity = $52,320 + $78,000 + $36,000 + $43,500 = $209,820
External financing needed = Total assets - Total liabilities and equity
External financing needed = $224,540 - $209,820
External financing needed = $14,720
A home equity line of credit (HELOC) is, loosely speaking, like a credit card for your home. You can borrow money by drawing down on the line of credit. But, because the borrowed money is for the purpose of your home, the interest is tax-deductible meaning that you can deduct the interest paid on this money from your income to reduce your taxes. If the current annual interest rate on a HELOC is 3.85\%3.85% and your tax rate is 32\2%, what is the after-tax interest rate you will pay on any borrowings under the HELOC
Answers
Answer:
2.618%
Explanation:
Current annual interest rate on a HELOC = 3.85%
Tax rate = 32%
After-tax interest rate = Before tax interest rate * (1 - Tax rate)
After-tax interest rate = 3.85% * (1 - 0.32)
After-tax interest rate = 0.0385 * 0.68
After-tax interest rate = 0.02618
After-tax interest rate = 2.618%
So, the after-tax interest rate you will pay on any borrowings under the HELOC is 2.618%.
Solving for dominant strategies and the Nash equilibrium Suppose Lorenzo and Neha are playing a game in which both must simultaneously choose the action Left or Right. The payoff matrix that follows shows the payoff each person will earn as a function of both of their choices. For example, the lower-right cell shows that if Lorenzo chooses Right and Neha chooses Right, Lorenzo will receive a payoff of 6 and Neha will receive a payoff of 5
Neha
Left Right
Lorenzo Left 8,4 4,5
Right 5,4 6,5
1. The only dominant strategy in this game is for (Neha/Lorenzo) to choose (Right/Left)
2. The outcome reflecting the unique Nash equilibrium in this game is as follows: Lorenzo chooses (Right/Left) and Neha chooses (Right/Left) .
Answers
Answer:
1. The only dominant strategy in this game is for Neha to choose Right.
2. The outcome reflecting the unique Nash equilibrium in this game is as follows: Lorenzo chooses Right and Neha chooses Right.
Explanation:
A dominant strategy is a strategy that results in a player being better off no matter the choice his or her opponent in a game.
For this game, when Lorenzo plays Left, Neha will choose Right because 5 > 4. Also, when Lorenzo plays Right, Neha will still choose Right because 5 > 4. This shows that Neha will always play Right no matter what Lorenzo plays. This implies the dominant strategy for Neha is Right.
On the other hand, when Neha plays Left, Lorenzo will also play Left because 8 > 5. But when Neha plays Right, Lorenzo will choose will also play Right because 6 > 4. This shows that Lorenzo does not have any particular strategy that make him better off. Therefore, Lorenzo does not have a dominant strategy.
Therefore, we have:
1. The only dominant strategy in this game is for (Neha/Lorenzo) to choose (Right/Left)
Based on the analysis above, the only dominant strategy in this game is for Neha to choose Right.
This is because the dominant strategy for Neha is Right, but Lorenzo does not have a dominant strategy.
2. The outcome reflecting the unique Nash equilibrium in this game is as follows: Lorenzo chooses (Right/Left) and Neha chooses (Right/Left) .
Based on the analysis above, the outcome reflecting the unique Nash equilibrium in this game is as follows: Lorenzo chooses Right and Neha chooses Right.
The reason is that Neha will always play Right and Lorenzo will be better of by also playing Right because 6 > 4.
Ahmed Company purchases all merchandise on credit. It recently budgeted the following month-end accounts payable balances and merchandise inventory balances. Cash payments on accounts payable during each month are expected to be: May, $1,200,000; June, $1,500,000; July, $1,400,000; and August, $1,400,000
Accounts Payable Merchandise Inventory
May 31 $150,000 $260,000
June 30 130,000 500,000
July 31 300,000 300,000
August 31 120,000 330,000
(1) Compute the budgeted amounts of merchandise purchases.
(2) Compute the budgeted amounts of cost of goods sold.
Answers
Answer:
1. Computation of Budgeted amount of Merchandise Purchases
Particulars June July August
Ending Accounts Payable $130,000 $300,000 $120,000
Payments on account $1,500,000 $1,400,000 $1,400,000
$1,630,000 $1,700,000 $1,520,000
Beginning Accounts Payable $150,000 $130,000 $300,000
Purchases $1,480,000 $1,570,000 $1,220,000
2. Computation of Budgeted amount of Cost of Goods Sold
Particulars June July August
Beginning inventory $260,000 $500,000 $300,000
Purchases $1,480,000 $1,570,000 $1,220,000
Cost of goods AFS $1,740,000 $2,070,000 $1,520,000
Ending Inventory $500,000 $300,000 $330,000
Cost of goods sold $1,240,000 $1,770,000 $1,190,000
Understanding that unemployment benefits give workers the incentive to not look for work until their benefits run out, suppose an economist suggested that instead of giving workers up to 26 weeks of unemployment benefits that end once the person finds work, a person who loses his or her job would just get a single big check for 26 weeks of benefits, regardless of how long the worker is unemployed. Which of the following are true?
1. It is likely to reduce unemployment by increasing the incentives to look for work earlier.
2. It would be costly.
3. It would reduce the incentive to work.
4. It would have to be combined with skill training.
Answers
Answer:
1. It is likely to reduce unemployment by increasing the incentives to look for work earlier.
2. It would be costly.
Explanation:
A worker who had received the benefits of unemployment has now added incentive for looking in to work earlier. But the cost will increase since the incentive provided for the entire period of the 52 weeks which is not limited to the period of how long the person took to get employment again.
So it is most likely to decrease the unemployment by an increase in the incentive to look for work again. And it this would also increased the cost.
Where would you go to get information for your business plan?
Answers
Credible websites for planning, credible websites for research on business, and anything to improve your knowledge to be prepared.
The Xtra Store has a Human Resources Department and a Janitorial Department that provide service to three sales departments. The Human Resources Department cost is allocated on the basis of employees, and the Janitorial Department cost is allocated on the basis of space. The following information is available:______.
Human
Resources Janitorial Sales #1 Sales #2 Sales #3
Budgeted cost $54,000 $39,000
Space in square feet 13,000 10,000 26,000 40,000 64,000
Number of employees 10 15 20 40 25
1. Using the direct method, the amount of Janitorial Department cost allocated to Sales Department no. 2 is: (Do not round your intermediate calculations. Round your final answer to nearest whole dollar amount.)
a. $17,696.
b. $10,636.
c. $9,941.
d. $13,750.
e. $12,000.
2. Using the step-down method and assuming that the Human Resources Department is allocated first, the amount of Human Resources cost allocated to Sales Department no. 3 is (Do not round your intermediate calculations. Round your final answer to nearest whole dollar amount):
a. $12,273.
b. $22,500.
c. $13,382.
d. $13,500.
e. $15,882.
3. Using the direct method, the amount of Janitorial Department cost allocated to Sales Department no. 2 is: (Do not round your intermediate calculations. Round your final answer to nearest whole dollar amount.)
a. $17,696.
b. $12,000.
c. $10,636.
d. $13,750.
e. $9,941.
4. Using the step-down method and assuming that the Human Resources Department is allocated first, the amount of Human Resources cost allocated to Sales Department no. 3 is (Do not round your intermediate calculations. Round your final answer to nearest whole dollar amount):______.
a. $22,500.
b. $13,500.
c. $12,273.
d. $13,382.
e. $15,882.
Answers
Answer:
The Xtra Store
1. Using the direct method, the amount of Janitorial Department cost allocated to Sales Department no. 2 is:
e. $12,000.
2. Using the step-down method and assuming that the Human Resources Department is allocated first, the amount of Human Resources cost allocated to Sales Department no. 3 is:
d. $13,500.
3. Using the direct method, the amount of Janitorial Department cost allocated to Sales Department no. 2 is:
b. $12,000.
4. Using the step-down method and assuming that the Human Resources Department is allocated first, the amount of Human Resources cost allocated to Sales Department no. 3 is:
b. $13,500.
Explanation:
a) Data and Calculations:
Human Resources Janitorial Sales #1 Sales #2 Sales #3
Budgeted cost $54,000 $39,000
Space in square feet 13,000 10,000 26,000 40,000 64,000
Number of employees 10 15 20 40 25
1. Direct method of allocation:
Janitorial Department cost of $39,000
Sales #2 = $12,000 ($39,000 * 40,000/130,000)
2. Step-down method:
Human Resources cost of $54,000
Sales #3 = $13,500 ($54,000 * 25/100)
Two organizations are both in the technology industry. What is most likely true about their corporate cultures?
Answers
Answer:
it's about vision, value, practices
At the beginning of 2020, Concord Company acquired a mine for $3,251,600. Of this amount, $124,000 was ascribed to the land value and the remaining portion to the minerals in the mine. Surveys conducted by geologists have indicated that approximately 12,100,000 units of ore appear to be in the mine. Concord incurred $210,800 of development costs associated with this mine prior to any extraction of minerals. It also determined that the fair value of its obligation to prepare the land for an alternative use when all of the mineral has been removed was $49,600. During 2020, 2,634,000 units of ore were extracted and 1,894,000 of these units were sold.
Required:
a. Compute the total amount of depletion for 2020.
b. Compute the amount that is charged as an expense for 2014 for the cost of the minerals sold during 2020.
Answers
Answer:
A. $737,520
B. $530,320
Explanation:
a. Computation for the total amount of depletion for 2020.
First step is to calculate the Depletion Rate
Depletion Rate = ($3,251,600 - $124,000 + $49,600 + $210,800)/12,100,000
Depletion Rate= $3,388,000/ 12,100,000
Depletion Rate= 0.28
Now let calculate the total amount of depletion for 2020.
2020 Total amount of depletion= 0.28 × $2,634,000
2020 Total amount of depletion= $737,520
Therefore the total amount of depletion for 2020 is $737,520
B. Computation for the amount that is charged as an expense for 2014 for the cost of the minerals sold during 2020.
Expense amount charged= ($737,520/$2,634,000)* 1,894,000
Expense amount charged=0.28 *1,894,000
Expense amount charged=$530,320
Therefore the amount that is charged as an expense for 2014 for the cost of the minerals sold during 2020 is $530,320
To increase productive capacity, a company is considering a proposed new plant. Which of the following statements is CORRECT? a. When estimating the project's operating cash flows, it is important to include both opportunity costs and sunk costs, but the firm should ignore the cash flow effects of externalities since they are accounted for in the discounting process. b. Since depreciation is a non-cash expense, the firm does not need to deal with depreciation when calculating the operating cash flows. c. The cost of capital used to discount cash flows in a capital budgeting analysis should be calculated on a before-tax basis. d. Capital budgeting decisions should be based on before-tax cash flows. e. In calculating the project's operating cash flows, the firm should not deduct financing costs such as interest expense, because financing costs are accounted for by discounting at the cost of capital. If interest were deducted when estimating cash flows, this would, in effect, "double count" it.
Answers
Answer:
e. In calculating the project's operating cash flows, the firm should not deduct financing costs such as interest expense, because financing costs are accounted for by discounting at the cost of capital. If interest were deducted when estimating cash flows, this would, in effect, "double count" it.
Explanation:
Weighted average cost of capital (WACC) is a calculation that takes into consideration all cost associated with capital obtained to finance a company.
This also includes cost such as interest expense.
In the given scenario when calculating the project's operating cash flow it is important to exclude such financing costs since they have been considered in the WACC calculation.
It will be a double deduction if it is considered again in operating cash flow calculation.
Sharp Screen Films, Inc., is developing its annual financial statements at December 31, current year. The statements are complete except for the statement of cash flows. The completed comparative balance sheets and income statement are summarized as follows:
Current Year Prior Year
Balance sheet at December 31
Cash $66,550 $65,500
Accounts receivable 18,150 24,750
Merchandise inventory 24,750 19,200
Property and equipment 212,250 152,600
Less Accumulated depreciation (61,500) (47,050)
$260,200 $215,000
Accounts payable $11,800 $21,900
Wages payable 4,500 5,100
Note payable, long-term 62,300 74,400
Contributed capital 102,000 67,000
Retained earnings 79,600 46,600
$260,200 $215,000
Income statement for current year
Sales $206,000
Cost of goods sold 103,000
Depredation expense 14,450
Other expenses 44,100
Net income $44,450
Additional Data:
a. Bought equipment for cash $59 650.
b. Paid $12,100 on the long-term note payable.
c. Issued new shares of stock for $35,000 cash.
d. Dividends of $11,450 were declared and paid.
e. Other expenses all relate to wages.
f. Accounts payable includes only inventory purchases made on credit.
Required:
Prepare the statement of cash flows using the indirect method for the year ended December 31, current year.
Answers
Answer and Explanation:
The preparation of the cash flow statement using the indirect method is as follows:
Cash flow from operating activities
Net income $44,450
Add: depreciation expense $14,450
Add: decrease in account receivable ($18,150 - $24,750) $6,600
Less: Increase in merchandise inventory ($24,750 - $19,200) $5,550
LesS: decrease in accounts payable ($11,800 - $21,900) $10,100
Less Decrease in wages payable ($4,500 - $5,100) -$600
Net cash provided from operating activities $49,250
Cash flow from investing activities
Equipment purchased -$59,650
Cash flow used by investing activities -$59,650
Cash flow from financing activities
Cash payment made for long term note payable -$12,100
Issuance of the new shares $35,000
Dividend paid -$11,450
Cash flow from financing activities $11,450
Net increase in cash $1,050
Add: opening cash balance $65,500
Closing cash balance $66,550
Debt: 2,000 par value bonds with a 15-year maturity, 7.2% coupon, which are currently selling for 105 percent of par. Common stock: 1M shares outstanding, selling for $20 per share, and a fixed dividend of $2.50 per year. Preferred stock: 9,500 shares of preferred stock with a 6 percent required return, currently selling for $55 per share. What is the company's WACC
Answers
Answer:
17.03 %
Explanation:
WACC = Cost of Equity x Weight of Equity + Cost of Debt x Weight of Debt + Cost of Preference Stock x Weight of Preference Stock
where,
Cost of Debt is calculated as :
Per $100 of bonds
FV = $100
PV = ($105)
PMT = $100 x 7.20% = $7.20
N = 15
P/yr = 1
r = ?
Using a financial calculator to enter values as above, cost of debt (r) is 6.66%
We always use after tax cost of debt
Therefore,
After tax cost of debt = interest x (1 - tax rate)
= 4.995%
therefore,
WACC = 12.50 % x 96.51% + 4.995% x 0.965 + 6.00 % x 2.52 %
= 17.03 %
TB MC Qu. 08-93 A company has established... A company has established 5 pounds of Material J at $2 per pound as the standard for the material in its Product Z. The company has just produced 1,000 units of this product, using 5,200 pounds of Material J that cost $9,880.The direct materials price variance is: Multiple Choice $520 unfavorable. $400 unfavorable. $120 favorable. $520 favorable. $400 favorable.
Answers
Answer:
Direct material price variance= $520 favorable
Explanation:
To calculate the direct material price variance, we need to use the following formula:
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (2 - 1.9)*5,200
Direct material price variance= $520 favorable
Actual price= 9,880 / 5,200= $1.9
Use the following information for VPI Co. to prepare a statement of cash flows for the year ended December 31 using the indirect method.
Cash balance at prior year-end $40,000
Gain on sale of machinery $2,000
Increase in inventory 5,000
Cash received from sale of machinery 9,500
Depreciation expense 4,000
Increase in accounts payable 1,500
Cash received from issuing stock 8,000
Net income 23,000
Cash paid for dividends 1,000
Decrease in accounts receivable 3,000
Answers
Answer:
VPI CO
Statement of Cash flows
For the Current year ended December 31
Cash flow from Operating activities
Net Income $23,000
Adjustments to reconcile net income to
net cash provided by operating activities
Depreciation Expense $4,000
Gain on sale of Machinery $(2,000)
Changes in Current Operating assets and liabilities
Decrease in Accounts Receivable $3,000
Increase in Inventory $(5,000)
Increase in Accounts Payable $1,500
Net cash Provided by operating activities $24,500
Cash flows from Investing Activities
Cash Received from Sale of Machinery $9,500
Net cash Provided by Investing activities $9,500
Cash flows from financing Activities
Cash Received from Issuing Stock $8,000
Cash Paid for Dividend $(1,000)
Net cash Provided by financing activities $7,000
Net increase in Cash $41,000
Cash Balance at Prior Year-end $40,000
Cash Balance at Current Year-end $81,000
Tonya Jefferson (single), a sole proprietor, runs a successful lobbying business in Washington, DC. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse, from which she runs her business, to buy a place somewhere sunny and warm. Tonya's townhouse is worth $1,000,000 and the land is worth another $1,000,000. The original basis in the townhouse was $600,000, and she has claimed $250,000 of depreciation deductions against the asset over the years. The original basis in the land was $500,000. Tonya has located a buyer that would like to finalize the transaction in December of the current year. Tonya's marginal ordinary income tax rate is 35 percent, and her capital gains tax rate is 20 percent.
Required:
a. What amount of gain or loss does Tonya recognize on the sale? What is the character of the gain or loss? What effect does the gain and loss have on her tax liability?
b. In additional to the original facts, assume that Tonya reports the following nonrecaptured 1231 loss:
Year Net §1231 Gains/(Losses)
Year 1 ($200,000)
Year 2 0
Year 3 0
Year 4 0
Year 5 0
Year 6 (current year) ?
c. What amount of gain or loss does Tonya recognize on the sale? What is the character of the gain or loss? What effect does the gain or loss have on her year 6 (the current year) tax liability?
d. Assuming the unrecaptured 1231 loss in part (b), as Tonya's tax advisorcould you make a suggestion as to when Tonya should sell the townhouse inorder to reduce her taxes? What would Tonya?s tax liability be if she adoptsyour recommendation??
Answers
Answer:
Explanation:
Tonya Jefferson (single), a sole proprietor, runs a successful lobbying business in Washington, DC. She doesn't sell many business assets, but she is planning on retiring and selling her historic townhouse, from which she runs her business, to buy a place somewhere sunny and warm. Tonya's townhouse is worth $1,000,000 and the land is worth another $1,000,000. The original basis in the townhouse was $600,000, and she has claimed $250,000 of depreciation deductions against the asset over the years. The original basis in the land was $500,000. Tonya has located a buyer that would like to finalize the transaction in December of the current year. Tonya's marginal ordinary income tax rate is 35 percent, and her capital gains tax rate is 20 percent.
Required:
a. What amount of gain or loss does Tonya recognize on the sale? What is the character of the gain or loss? What effect does the gain and loss have on her tax liability?
b. In additional to the original facts, assume that Tonya reports the following nonrecaptured 1231 loss:
Year Net §1231 Gains/(Losses)
Year 1 ($200,000)
Year 2 0
Year 3 0
Year 4 0
Year 5 0
Year 6 (current year) ?
c. What amount of gain or loss does Tonya recognize on the sale? What is the character of the gain or loss? What effect does the gain or loss have on her year 6 (the current year) tax liability?
d. Assuming the unrecaptured 1231 loss in part (b), as Tonya's tax advisorcould you make a suggestion as to when Tonya should sell the townhouse inorder to reduce her taxes? What would Tonya?s tax liability be if she adoptsyour recommendation??
Placid Lake Corporation acquired 90 percent of the outstanding voting stock of Scenic, Inc., on January 1, 2020, when Scenic had a net book value of $640,000. Any excess fair value was assigned to intangible assets and amortized at a rate of $7,000 per year. Placid Lake's 2021 net income before consideration of its relationship with Scenic (and before adjustments for intra-entity sales) was $540,000. Scenic reported net income of $350,000. Placid Lake declared $170,000 in dividends during this period; Scenic paid $64,000. At the end of 2021, selected figures from the two companies' balance sheets were as follows:
Placid Lake Corporation Scenic, Inc.
Inventory $350,000 $111,000
Land 810,000 410,000
Equipment (net) 610,000 510,000
During 2019, intra-entity sales of $180,000 (original cost of $84,000) were made. Only 30 percent of this inventory was still held within the consolidated entity at the end of 2019. In 2020, $300,000 in intra-entity sales were made with an original cost of $80,000. Of this merchandise, 40 percent had not been resold to outside parties by the end of the year.
Required:
a. What is consolidated net income for Placid Lake and its subsidiary?
b. If the intra-entity sales were upstream, how would consolidated net income be allocated to the controlling and noncontrolling interest?
c. If the intra-entity sales were downstream, how would consolidated net income be allocated to the controlling and noncontrolling interest?
d. What is the consolidated balance in the ending Inventory account?
Answers
Answer:
a. Consolidated net income for Placid Lake and its subsidiary is $823,800.
b-1. Noncontrolling interest share of consolidated net income is $28,380.
b-2. Placid Lakes or controlling interest share of consolidated net income is $795,420. .
c-1. Noncontrolling interest share of consolidated net income is $34,300.
c-2. Placid Lakes or controlling interest share of consolidated net income is $789,500.
d. Consolidated balance in the ending Inventory account is $373,000.
Explanation:
Note: There is a minor error in the question where 2019 is used instead of 2020. This is therefore corrected to avoid confusion before answering the question. The complete question with the correction is therefore presented as follows:
Placid Lake Corporation acquired 90 percent of the outstanding voting stock of Scenic, Inc., on January 1, 2020, when Scenic had a net book value of $640,000. Any excess fair value was assigned to intangible assets and amortized at a rate of $7,000 per year. Placid Lake's 2021 net income before consideration of its relationship with Scenic (and before adjustments for intra-entity sales) was $540,000. Scenic reported net income of $350,000. Placid Lake declared $170,000 in dividends during this period; Scenic paid $64,000. At the end of 2021, selected figures from the two companies' balance sheets were as follows:
Placid Lake Corporation Scenic, Inc.
Inventory $350,000 $111,000
Land 810,000 410,000
Equipment (net) 610,000 510,000
During 2020, intra-entity sales of $180,000 (original cost of $84,000) were made. Only 30 percent of this inventory was still held within the consolidated entity at the end of 2020. In 2020, $300,000 in intra-entity sales were made with an original cost of $80,000. Of this merchandise, 40 percent had not been resold to outside parties by the end of the year.
Required:
a. What is consolidated net income for Placid Lake and its subsidiary?
b. If the intra-entity sales were upstream, how would consolidated net income be allocated to the controlling and noncontrolling interest?
c. If the intra-entity sales were downstream, how would consolidated net income be allocated to the controlling and noncontrolling interest?
d. What is the consolidated balance in the ending Inventory account?
Explanation of the answers is now given as follows:
Note: See the attached excel file for all the calculation related parts a, b, and c.
d. What is the consolidated balance in the ending Inventory account?
Unrealized gross profit, 12/31/21 (w.2. in the attached excel file) = $88,000
Consolidated balance in the ending Inventory account = Book value of Placid Lake Corporation Inventory + Book value of Scenic, Inc. Inventory - Unrealized gross profit, 12/31/21 = $350,000 + $111,000 - $88,000 = $373,000
Simplifying the ABC System: TDABC Golding Bank provided the following data about its resources and activities for its checking account process:
Resources Activities Time per Unit Activity Driver
Supervision $60,000 Processing accounts 0.20 hr. No. of accounts
Phone and supplies 76,000 Issuing statements 0.10 hr. No. of statements
Salaries 242,000 Processing transactions 0.05 hr. No. of transactions
Computer 22,000 Answering customer inquiries 0.15 hr. No. of inquiries
Total 400,000
Total check processing hours 20,000
(practical capacity)
Required:
1. Calculate the capacity cost rate for the checking account process. Round your answers to the nearest cent.
$ per hour
2. Calculate the activity rates for the four activities. Round your answers to the nearest cent..
Processing accounts $ per account
Issuing statements $ per statement
Processing transactions $ per transaction
Answering inquiries $ per inquiry
If the total number of statements issued was 20,000, calculate the cost of the issuing statements activity.
Answers
Answer:
1.$20 per hour
2. Processing accounts $4 per account
Issuing statements $2 per statement
Processing transactions $1 per transaction
Answering inquiries $3 per inquiry
$40,000
Explanation:
1. Calculation to determine the capacity cost rate for the checking account process
Using this formula
Capacity cost rate= Total resources / Total checking processing hours
Let plug in the formula
Capacity cost rate= $400,000 / 20,000
Capacity cost rate= $20 per hour
Therefore the capacity cost rate for the checking account process is $20 per hour
2. Calculation to determine the activity rates for the four activities.
Processing accounts= 0.20 × $20
Processing accounts= $4 per account
Issuing statements= 0.10 × $20
Issuing statements= $2 per statement
Processing transactions= 0.05 × $20
Processing transactions= $1 per transaction
Answering inquiries= 0.15 × $20
Answering inquiries= $3 per inquiry
Therefore the activity rates for the four activities are:
Processing accounts $4 per account
Issuing statements $2 per statement
Processing transactions $1 per transaction
Answering inquiries $3 per inquiry
Calculation to determine the cost of the issuing statements activity If the total of issuing statement was 20,000
Using this formula
Cost of the issuing statements activity= Issuing statements*Total of issuing statement
Cost of the issuing statements activity
Let plug in the formula
Cost of the issuing statements activity= 20,000 × $2
Cost of the issuing statements activity= $40,000
Therefore the cost of the issuing statements activity is $40,000
Evanson Company expects to produce 540,000 units of their product during the year. Monthly production is expected to range from 40,000 to 80,000 units. The company has budgeted manufacturing costs per unit to be as follows: Direct materials $ 14 Direct labor 15 Variable manufacturing overhead 16 Fixed manufacturing overhead 3 Prepare a flexible manufacturing budget using 20,000 unit increments.
Answers
Answer:
Evanson Company
Evanson Company
Flexible Monthly Budget
Activity Level:
Finished goods (Units) 40,000 60,000 80,000
Variable costs:
Direct materials $560,000 $840,000 $1,120,000
Direct labor 600,000 900,000 1,200,000
Manufacturing overhead 640,000 960,000 1,280,000
Total variable costs $1,800,000 $2,700,000 $3,600,000
Fixed manufacturing
overhead 135,000 135,000 135,000
Total production costs $1,935,000 $2,835,000 $3,735,000
Explanation:
a) Data and Calculations:
Expected production units per year = 540,000
Average monthly production units = 45,000 (540,000/12)
Manufacturing costs per unit:
Direct materials $ 14
Direct labor 15
Variable manufacturing overhead 16
Fixed manufacturing overhead 3
Total yearly fixed overhead = $1,620,000 (540,000 * $3)
Monthly fixed overhead = $135,000 ($1,620,000/12)
b) A flexible budget has varying activity levels from one period to the next. One interesting feature of the flexible budget is that the variable costs are fixed per unit, but their totals vary with the volume levels. On the other hand, the fixed costs remain static in totals but vary per unit.
Trends such as more frequent shipments, lighter-weight shipments, and higher-value shipments:_________
a. help standardize rates on air and ocean shipments for incoming and outgoing freight
b. make ocean freight more effective than it has been in the past
c. increase the growth of airfreight traffic
d. have decreased the cost of containerization
Answers
Answer:
B
Explanation:
B is the answer I am not 100 percent sure
find using distributive property
Answers
Multiply (distribute) the first numbers of each set, outer numbers of each set, inner numbers of each set, and the last numbers of each set.
Combine like terms.
Solve the equation and simplify, if needed.
Help a brother out ...............
Answers
Macrosoft Company reports net income of $55,000. The accounting records reveal depreciation expense of $70,000 as well as increases in prepaid rent, accounts payable, and income tax payable of $50,000, $11,000, and $13,000, respectively. Prepare the operating activities section of Macrosoft's statement of cash flows using the indirect method. (List cash outflows and any decrease in cash as negative amounts.)
Answers
Answer:
$99,000
Explanation:
According to the scenario, computation of the given data are as follows,
Net income = $55,000
Add- Depreciation expense = $70,000
Less- prepaid rent = $50,000
Add- accounts payable = $11,000
Add- Income tax payable = $13,000
Total = $99,000
Hence, Net cash flow from operating activities = $99,000