Answer:
The answer is below
Explanation:
If one machine breaks, the others breaks, this means that the are connected in series, hence the reliability of the line is:
Reliability of line = 0.92 * 0.97 * 0.87 = 0.7764
A) Plan 1: Plan A involves connecting a backup line in parallel, therefore the overall reliability would be:
Overall reliability = 1 - (1 - 0.7764)² = 0.95
B) Plan 2: In plan B, each machine has a backup.
Hence:
For machine A: Reliability = 1 - (1 - 0.92)² = 0.9936
For machine B: Reliability = 1 - (1 - 0.97)² = 0.9991
For machine C: Reliability = 1 - (1 - 0.97)² = 0.9831
Overall system reliability = 0.9936*0.9991*0.9831 = 0.9759
C) Since plan 2 has a higher reliability hence plan 2 is the better plan
Illustrate your understanding of how to use the adjusted trial balance to prepare a statement of retained earnings by completing the following sentence.
In order to prepare the statement of retained earnings, the balance of the _____________ account balance as well as any debit balance in the ______________ account is transferred from the adjusted trial balance and is used along with the reported net income (loss) from the Income statement.
Answer:
a. Retained earnings
b. Net income
Explanation:
The format of the statement of the retained earnings is presented below:
Retained Earning statement
For the year ended
Beginning balance of retained earning XXXXX
Add: Net income XXXXX
Less: Cash Dividend paid XXXXX
Ending balance of retained earning XXXXX
By considering the above items i.e. Beginning opening balance, net income, and the dividend the statement of the retained earnings should be prepared.
Presented below are selected accounts for Sheffield Company as reported in the worksheet at the end of May 2020.
Complete the worksheet by extending amounts reported in the adjusted trial balance to the appropriate columns in the worksheet.
Accounts Adjusted Trial Balance Income Statement Balance Sheet
Dr. Cr. Dr. Cr. Dr. Cr.
Cash 8,800
Inventory 77,750
Sales Revenue 446,000
Sales Returns and
Allowances 9,210
Sales Discounts 4,730
Cost of Goods Sold 243,700
Answer:
Accounts Adjusted T-Balance Income Statement Balance Sheet
Debit Credit Debit Credit Debit Credit
Cash $8,800 $8,800
Inventory $77,750 $77,750
Sales Revenue $446,000 $446,000
Sales Returns $9,210 $9,210
and Allowances
Sales Discounts $4,730 $4,730
Cost of Goods $243,700 $243,700
Sold
Basic job Costing
1. Our company makes customized jewelry Customer 101 orders a ring (job 101).
2. It requires 2 grams of 14k gold, 1 diamond and 3 rubies.
c. Customer 102 orders a pendant (job 102). It requires 4 grams of 14 k gold, and 1 ruby.
d. Purchasing buys 1,000 grams of 14k gold for $24,000. 10 diamonds for $28,000, and 10 rubies for $14,000.
e. For the month, the company had factory labor costs of $280,000 and 10,000 hours.
Required:
Prepare the journal entry for the purchases/receivings.
Prepare the journal entry for the direct materials requisitions (by job).
Prepare the journal entry for factory payroll.
Answer:
1) Prepare the journal entry for the purchases/receivings.
Dr Inventory: 14k gold 24,000
Dr Inventory: diamonds 28,000
Dr Inventory: rubies 14,000
Cr Cash (or accounts payable) 66,000
2) Prepare the journal entry for the direct materials requisitions (by job).
Dr Work in process (job 101) 7,480
Cr Inventory: 14k gold 480
Cr Inventory: diamonds 2,800
Cr Inventory: rubies 4,200
Dr Work in process (job 102) 2,360
Cr Inventory: 14k gold 960
Cr Inventory: rubies 1,400
3) Prepare the journal entry for factory payroll.
Dr Work in process 280,000
Cr Wages payable 280,000
During 2019, Ocean Consulting had the following transactions with it clients (customers): On February 1, 2019, the company received cash of $5,500 from clients in payment of their account balances as of December 31, 2018. On November 1, 2019, the company received $2,500 cash as payments in advance for services to be performed in 2020. The company received a total of $15,500 in cash for services that were performed during 2019. The company sent bills totaling $4,500 to clients for services performed during 2019; this amount was unpaid as December 31, 2019.
As a result of these transactions during 2019, the firm's stockholders' equity will:__________
Answer:
$20,000
Explanation:
According to the given situation, the computation of stockholder equity is shown below:-
Stockholder equity = Service in cash + Sent bills
= $15,500 + $4,500
= $20,000
Therefore for computing the stockholder equity we simply applied the above formula so that the correct value could come
Hence, the stockholder equity is $20,000
Techuxia Corporation worked on four jobs during October: Job A256, Job A257, Job A258, and Job A260. At the end of October, the job cost sheets for these jobs contained the following data:
Job A256 Job A257 Job A258 Job A260
Beginning balance $920 $640 $0 $0
Charged to the jobs during October:
Direct materials $2,750 $4,020 $1,550 $3,750
Direct labor $1,150 $930 $650 $460
Manufacturing overhead
applied $4,420 $1,760 $2,345 $400
Units completed 210 0 101 0
Units in process at the
end of October 0 310 0 253
Units sold during October 155 0 52 0
Jobs A256 and A258 were completed during October. The other two jobs had not yet been completed at the end of October. There was no finished goods inventory on October 1. In October, overhead was overapplied by $1,380. The company adjusts its cost of goods sold every month for the amount of the underapplied or overapplied overhead.
Required:
1. Using the direct method, what is the cost of goods sold for October?
2. What is the total value of the finished goods inventory at the end of October?
3. What is the total value of the work in process inventory at the end of October?
Answer:
1 $10,540
2 $4,625
3 $11,960
Explanation:
1. Cost of goods sold for October is $10,540
2. Total value of finished goods inventory for October is $4,625
3. Total value of work in process inventory at the end of October is $11,960
Please find attached explanations to the above answers.
Pearl Corporation bought Noodle Bowl Limited at the end of the fiscal year. While negotiating the purchase price, Pearl’s management team referred to the following three recent appraisals from independent valuation consultants.
Appraised Value Appraisal Method
Noodle Bowl brand name $50 million Cash flow model based on observed royalty rates
Noodle Bowl workforce $40 million Estimate of the replacement cost to recruit and train an equivalent workforce
Favorable lease agreements $20 million Cash flow model of the anticipated savings from Noodle Bowl's favorable (below market) $20 million contractually guaranteed rental rates for retail space
Required:
Which of the above intangibles is likely to be recorded as a distinct identiflable asset in Pearl Corporation's consolidated financia statement? Which is likely to be recorded as part of goodwill? Explain your reasoning.
Answer:
Identifiable Asset is the one which can be separated from the business and can be identified separately. The asset should have the capability to be disposed of individually. Favorable lease agreements are one such asset which qualifies these conditions. Thus, Favorable lease agreements should be recorded as a distinct asset in Pearl Corporation's consolidated financial statement.
Every such asset which cannot be identified separately should be recorded as goodwill. We cannot recognize Noodle Bowl workforce and Noodle Bowl brand name as a distinctive asset. Thus, they both should be recorded as a part of goodwill.
Prepare adjusting journal entries, as needed, for the following items.
A. The Supplies account shows a balance of $530, but a count of supplies reveals only $280 on hand at year-end.
B. The company initially records the payments of all insurance premiums as prepaid insurance. The unadjusted trial balance at year-end shows a balance of $570 in Prepaid Insurance. A review of insurance policies reveals that $140 of insurance is unexpired.
C. Employees work Monday through Friday, and salaries of $2,900 per week are paid each Friday. The company's year-end falls on Tuesday.
D. At year-end, the company received a utility bill for December's electricity usage of $250 that will be paid in early January.
Answer:
Explanation:
Journal Entry is the way to record transactions, i.e business transactions into the record of account which is called Journal Book. It involves the identification of those account present in the transaction,know the type of account, then with accounting rule, record the transaction.
CHECK THE ATTACHMENT FOR THE PREPARED JOURNAL
Suppose you’re evaluating three alternative MMMF investments. The first fund buys a diversified portfolio of municipal securities from across the country and yields 3.95 percent. The second fund buys only taxable, short-term commercial paper and yields 5.7 percent. The third fund specializes in the municipal debt from the state of New Jersey and yields 3.6 percent. If you are a New Jersey resident, your federal tax bracket is 35 percent, and your state tax bracket is 8 percent.1. Calculate the aftertax yield for each of the alternatives. (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Omit the "%" sign in your response.) Aftertax Yield Municipal fund 3.95 % Taxable fund 3.31 % New Jersey municipal fund %2. Which of these three MMMFs offers you the highest aftertax yield?a. New Jersey Fundb. Municipal Fundc. Taxable Fund
Answer:
1) After tax yield for each alternative will be calculated as;
Municipal Fund after-tax yield = 0.0395*(1-0.08)
Municipal Fund after-tax yield = 0.0395*0.92
Municipal Fund after-tax yield = 0.03634
Municipal Fund after-tax yield = 3.63
Taxable Fund after-tax yield = 0.057(1 - 0.35 -0.08)
Taxable Fund after-tax yield = 0.057*0.57
Taxable Fund after-tax yield = 0.03249
Taxable Fund after-tax yield = 3.25
New jersey municipal fund after-tax yield =
2) Municipal fund offers the highest after-tax yield out of these three MMMF's
The following data were taken from the balance sheet accounts of Masefield Corporation on December 31, 2019.
Current assets $540,000
Debt investments (trading) 624,000
Common stock (par value $10) 500,000
Paid-in capital in excess of par 150,000
Retained earnings 840,000
Required:
Prepare the required journal entries for the following unrelated items.
a. A 5% stock dividend is declared and distributed at a time when the market price per share is $39.
b. The par value of the common stock is reduced to $2 with a 5-for-1 stock split.
c. A dividend is declared January 5, 2020, and paid January 25, 2020, in bonds held as an investment. The bonds have a book value of $100,000 and a fair value of $135,000.
Answer:
Please see below
Explanation:
a. A 5% stock dividend is declared and distributed when the market per share was $39.
Common stock par value($10) 500,000
Retained earning = 50,000 × 5% × 39
= $97,500
Common stock dividend distributed
50,000 × 5% × $10
= $25,000
See attached further explanations.
The minimum downside projection from a head and shoulders top pattern is derived a. by projecting downward from the neckline, the vertical distance from the top of the head to the neckline b. by measuring the width of the left shoulder and subtracting that distance from the neckline c. by measuring the distance from the penetration of the neckline by the left shoulder to the penetration of the neckline by the right shoulder and extending down from the point of penetration of the right shoulder d. by estimating the length of the primary price cycle
Answer:
a. by projecting downward from the neckline, the vertical distance from the top of the head to the neckline
Explanation:
Top pattern of head and shoulders Simple and commonly used pattern by trader in technical analysis. The trader under this model is well aware of what they are looking for. This type of model is available throughout the day, so investors and traders use this model for msking investments. This type of chart provides benefits such as stopping orders for easy trading, price targets and minimizing losses in trading. The minimum negative value from the head and shoulder top pattern is provided below the projection neckline, which is the vertical distance from the top of the head to the neckline.Christopher likes cupcakes (C) and muffins (M). His preferences can be represented by the utility function U(C, M) = C0.5M0.5. He received a gift basket with 16 cupcakes and 4 muffins, but when he was about to eat them, he found out his younger brother Dan had eaten 14 cupcakes and 2 muffins. Christopher made Dan buy what he'd eaten back. However, the bakery was out of muffins and Dan only bought cupcakes. How many cupcakes did Dan buy if, in addition to what he had not eaten from the basket, the new cupcakes provide Christopher with the same level of utility as the original gift basket?
Answer:
16 cupcakes
Explanation:
U(C, M) = C⁰°⁵ x M⁰°⁵ = √C x √M
total utility obtained by eating 16 cupcakes and 4 muffins = √16 x √4 = 4 + 2 = 6
since the bakery is out of muffins, then utility function = √C x √2 = √C x 1.4142
√C x 1.4142 = 6
√C = 6 / 1.4142 = 4.2426
C = 4.2426² = 18
since there were 2 cupcakes left, Christopher must purchase 18 - 2 = 16 cupcakes
Supply Company reported the following information in its comparative financial statements for the fiscal year ended January 31.
January 31 January 31
2018 2017
Net sales $91,000 $89,500
Net earnings $6,370 $6,220
Average total assets $65,000 $64,400
Requirement
1. Compute net profit margin ratio (%) for the years ended January 31, and 2017. Did it improve or worsen in 2018?
2. Compute asset turnover for the years ended January 31, 2018 and 2017. Did improve or worsen in 2018? 2018 2017 91,000 $ 89,500 Net sales
3. Compute return on assets for the years ended January 31, 2018 and 2017. Did it improve or worsen in 2018? Which component-net profit margin ratio or asset turnover-was mostly responsible for the change in the company's return on assets?
Answer: See explanation
Explanation:
1. Net profit margin ratio (%) for 2017 will be:
= Net income/Net sales
= 6220/89500
= 0.0695
= 6.95%
Net profit margin ratio (%) for 2018 will be:
= Net income/Net sales
= 6370/91000
= 0.07
= 7%
An improvement of (7% - 6.95%) = 0.05% occurs in net profit.
2. Asset turnover for the year ended 2017 will be:
Net sales/Average total assets
= 89500/64400
= 1.39
= 139%
Asset turnover for the year ended 2018 will be:
Net sales/Average total assets
= 91000/65000
= 1.4
= 140%
There's an improvement in the asset turnover in 2018.
3. Return on assets for 2017 will be:
= Net income/Average total asset
= 6220/64400
= 9.66%
Return on assets for 2018 will be:
= Net income/Average total asset
= 6370/65000
= 9.80%
An improvement in return on total assets of (9.80% - 9.66%) = 0.14% occurs.
Both component-net profit margin ratio or asset turnover- are responsible for the change in the company's return on assets.
Recording sales, purchases, shipping, and returns—buyer and seller LO P1, P2
Sydney Retailing (buyer) and Troy Wholesalers (seller) enter into the following transactions.
May
11 Sydney accepts delivery of $29,500 of merchandise it purchases for resale from Troy: invoice dated May 11, terms 3/10, n/90, FOB shipping point. The goods cost Troy $19,765. Sydney pays $590 cash to Express Shipping for delivery charges on the merchandise.
12 Sydney returns $1,200 of the $29,500 of goods to Troy, who receives them the same day and restores them to its inventory. The returned goods had cost Troy $804.
20 Sydney pays Troy for the amount owed. Troy receives the cash immediately.
(Both Sydney and Troy use a perpetual inventory system and the gross method.)
1. Prepare journal entries that Sydney Retailing (buyer) records for these three transactions.
2. Prepare journal entries that Troy Wholesalers (seller) records for these three transactions.
Answer:
Sydney Retailing (buyer) and Troy Wholesalers (seller)
Sydney Retailing Records:
May 11:
Debit Inventory $29,500
Credit Troy (Accounts Payable) $29,500
To record the purchase of merchandise, terms 3/10, n/90, FOB shipping point.
Debit Freight-in on Inventory $590
Credit Cash Account $590
To record the payment of freight.
May 12
Debit Troy (Accounts Payable) $1,200
Credit Inventory $1,200
To record the return of goods to Troy,
May 20:
Debit Troy (Accounts Payable) $28,300
Credit Cash Account $28,300
To record the payment to Troy on account.
Troy Wholesalers Records:
May 11:
Debit Sydney Retailing (Accounts Receivable) $29,500
Credit Sales Revenue $29,500
To record the sale of merchandise, terms 3/10, n/90, FOB shipping point.
Debit Cost of Goods Sold $19,765
Credit Inventory $19,765
To record the cost of goods sold.
May 12
Debit Sales Returns $1,200
Credit Sydney Retailing (Accounts Receivable) $1,200
To record the return of goods.
Debit Inventory $804
Credit Cost of Goods Sold $804
To record the return of goods.
May 20:
Debit Cash Account $28,300
Credit Sydney Retailing (Accounts Receivable) $28,300
To record the receipt of cash on account.
Explanation:
The records kept by Sydney (the buyer) and Troy (the seller) look alike in some ways but are recorded in opposite directions. However, there are minor differences that reflect the cost effects of goods and financial value exchanging hands between the two trading parties.
Predictive analytics in business is an important application of multiple regression analysis. Generally speaking, what is meant by predictive analytics
Answer:
Predictive analytics is a branch of statistics that is used to predict unknown events in the future
Explanation:
Predictive analytics uses various tools such as data mining, predictive modelling, and machine learning for the purpose of analysing historical data to predict future outcomes.
Businesses use this method to predict rail and opportunities based on previous transactional data.
It eventually provides predictive score or probability that can be used in credit risk, marketing, healthcare, and fraud detection
Use the following items to determine the total assets, total liabilities, net worth, total cash inflows, and total cash outflows. Rent for the month $ 1,360 Monthly take-home salary $ 3,260 Cash in checking account $ 1,270 Savings account balance $ 1,990 Spending for food $ 560 Balance of educational loan $ 2,390 Current value of automobile $ 8,530 Telephone bill paid for month $ 94 Credit card balance $ 334 Loan payment $ 147 Auto insurance $ 326 Household possessions $ 3,970 Stereo equipment $ 2,590 Payment for electricity $ 166 Lunches/parking at work $ 181 Donations $ 122 Home computer $ 2,140 Value of stock investment $ 1,810 Clothing purchase $ 137 Restaurant spending $ 167 Total assets $ Total liabilities $ Net worth $ Total cash inflows $ Total cash outflows $
Answer:
Cash inflows = $3,260
Cash outflows = $3,260
Total assets = $22,300
Total liabilities = $2,724
Net worth = $19,576
Explanation:
Cash inflows = Monthly take-home salary $3,260
Cash outflows = Rent for the month $1,360 + Spending for food $560 + Telephone bill paid for month $94 + Loan payment $147 + Auto insurance $326 + Payment for electricity $166 + Lunches/parking at work $181 + Donations $122 + Clothing purchase $137 + Restaurant spending $167 = $3,260
Total assets = Cash in checking account $1,270 + Savings account balance $1,990 + Current value of automobile $8,530 + Household possessions $3,970 + Stereo equipment $2,590 + Home computer $2,140 + Value of stock investment $1,810 = $22,300
Total liabilities = Balance of educational loan $2,390 + Credit card balance $334 = $2,724
Net worth = $22,300 - $2,724 = $19,576
Munchies, Inc., dominates the snack-food industry with its Salty Chip brand. Assume that Munchies purchased Sweet Snacks Company for $5.4 million cash. The market value of Sweet Snacks’ assets is $10 million, and Sweet Snacks has liabilities with a market value of $7.1 million.
Required:
a. Compute the cost of the goodwill purchased by Munchies.
b. Explain how Munchies will account for goodwill in future years.
Answer:
$2500000
Explanation:
A
1. Goodwill = purchase consideration - market value of net assets of the company
Market value of net assets of the company =$10000000-$7100000
=$2900000
Therefore goodwill=$5400000-$2900000=
$2500000
2. Under GAAP and IFRS, goodwill is an intangible asset that has an indefinite useful life and not amortized like other depreciable assets
Nelson Ovalles worked as a cable installer for Cox Rhode Island Telecom, LLC, under an agreement with a third party, M&M Communications, Inc. The agreement stated that no employer-employee relationship existed between Cox and M&M’s technicians, including Ovalles. Ovalles was required to designate his affiliation with Cox on his work van, clothing, and identification badge, but Cox had minimal contact with him and limited power to control the manner in which he performed his duties. Cox supplied cable wire and similar items, but the equipment was delivered to M&M, not to Ovalles. On a workday, while Ovalles was fulfilling a work order, his van rear ended a car driven by Barbara Cayer.
a. Is Cox liable to Cayer?
b. Are independent contractors the same as employees?
c. What is the difference?
Answer:
a. Is Cox liable to Cayer?
No
b. Are independent contractors the same as employees?
No
c. What is the difference?
Ovalles cannot be considered Cox's employee because Cox didn't control the performance of Ovalles and didn't have contact with him.
Independent contractors are not covered by labor and employment laws, and they are responsible for paying their own taxes, including self-employment taxes. A contractor does not work on a salary basis, their work and pay must be specified in a contract.
Explanation:
This is an actual court case where the Supreme Court of Rhode Island ruled in favor of Cox Communications in February, 2014.
The court ruled that Ovalles was an employee for M&M, and that M&M had an independent contractor relationship with Cox Communications. Additionally, Ovalles was also an independent contractor for M&M, not an employee. There existed no direct relationnship between Cox and Ovalles.
Even though Ovalles and other independent contractors use both Cox's and M&M's logos on their vans and uniforms, this was done so consumers could identify them. The fact that an identification is needed so customers can determine the function of a technician, doesn't imply that those technicians are actually employees of the firm nor they actually a method of control over the technicians.
Since Cox didn't control the performance of Ovalles and didn't have contact with him, then there was no reason to consider him an employee of Cox.
The plaintiff, Barbara Cayer probably made a mistake when it included Cox in the lawsuit (since it is a large company), and she would have had a better case against M&M because that company did have control over Ovalles's performance and did have contact with him. But since M&M was a much smaller firm, they decided to go after the big fish. Later they tried to include M&M into the lawsuit but it was rejected since the Supreme Court had not made their ruling yet.
At the end of 2020, Payne Industries had a deferred tax asset account with a balance of $70 million attributable to a temporary book-tax difference of $280 million in a liability for estimated expenses. At the end of 2021, the temporary difference is $208 million. Payne has no other temporary differences and no valuation allowance for the deferred tax asset. Taxable income for 2021 is $504 million and the tax rate is 25%.
Payne has a valuation allowance of $28 million for the deferred tax asset at the beginning of 2021.Required:A. Prepare the journal entry(s) to record Payne’s income taxes for 2021, assuming it is more likely than not that the deferred tax asset will be realized in full.B. Prepare the journal entry(s) to record Payne’s income taxes for 2021, assuming it is more likely than not that only one-fourth of the deferred tax asset ultimately will be realized.
Answer:
A.
1. Dr Income tax expense $144
Cr To Deferred Tax Assets $18
Cr To Income Tax Payable $126
2. No Journal Entry
B.
1. Dr Income tax expense $144
Cr To Deferred Tax Assets $18
Cr To Income Tax Payable $126
2. Dr Income tax expense $39
Cr To Valuation Allowance - Deferred Tax Assets $39
Explanation:
A. Preparation of the journal entry(s) to record Payne’s income taxes for 2021
1. Dr Income tax expense $144
($126+$18)
Cr To Deferred Tax Assets $18
[($280-$208)*25%]
Cr To Income Tax Payable $126
($504*25%)
(Being income tax expense recorded for 2021 and deferred tax assets reversed for temporary differences reversal )
2 No Journal Entry
B. Preparation of the journal entry(s) to record Payne’s income taxes for 2021
1. Dr Income tax expense $144
($126+$18)
Cr To Deferred Tax Assets $18
[($280-$208)*25%]
Cr To Income Tax Payable $126
($504*25%)
(Being income tax expense recorded for 2021 and deferred tax assets reversed for temporary differences reversal )
2. Dr Income tax expense $39
Cr To Valuation Allowance - Deferred Tax Assets $39
[($208*75%)*25%]
(To record valuation allowance for deferred tax assets)
Harris Fabrics computes its plantwide predetermined overhead rate annually on the basis of direct labor-hours. At the beginning of the year, it estimated that 43,000 direct labor-hours would be required for the period’s estimated level of production. The company also estimated $540,000 of fixed manufacturing overhead cost for the coming period and variable manufacturing overhead of $4.00 per direct labor-hour. Harris’s actual manufacturing overhead cost for the year was $787,704 and its actual total direct labor was 43,500 hours.
Required:
Compute the company’s plantwide predetermined overhead rate for the year. (Round your answer to 2 decimal places.)
Answer:
$16.56 per direct labor hour.
Explanation:
Plant wide predetermined overhead rate for the year
= Total estimated overhead cost ÷ Total estimated allocation base
= $712,000 / 43,000 direct labor hour
= $16.56 per direct labor hour.
Note : Total estimated overhead cost
Fixed manufacturing overhead $540,000
Add: Variable manufacturing overhead ($4 × 43,000 hour) $172,000
Total estimated manufacturing cost $712,000
The Esposito Import Company had 1 million shares of common stock outstanding during 2021. Its income statement reported the following items: income from continuing operations, $7 million; loss from discontinued operations, $1.4 million. All of these amounts are net of tax.
Required:
Prepare the 2021 EPS presentation for the Esposito Import Company.
Answer:
$5.60 million
Explanation:
Preparation of the 2021 EPS presentation for the Esposito Import Company.
Earnings per share :
Income from continuing operations $7.00 million
Less: Loss from discontinued operations ($1.40 million)
Net income $5.60 million
Therefore the 2021 EPS presentation for the Esposito Import Company will be $5.60 million
Pasadena Candle Inc. budgeted production of 715,000 candles for the January. Wax is required to produce a candle. Assume 10 ounces of wax is required for each candle. The estimated January 1 wax inventory is 18,600 pounds. The desired January 31 wax inventory is 12,800 pounds. If candle wax costs $2.10 per pound, determine the direct materials purchases budget for January. (One pound = 16 ounces.) Round all computed answers to the nearest whole number. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
Answer:
Purchases Quantity = 441075 pounds
Purchases Value = $926257.5
Explanation:
To calculate the quantity and value of the purchases of direct material for the month of January, we first need to determine the quantity of direct material needed for production in January and adjust it with the opening inventory of direct material and the desired closing inventory.
To produce 715000 candles, the wax needed (in pounds) = 715000 * 10/16
To produce 715000 candles, the wax needed (in pounds) = 446875 pounds
The purchases for wax in pounds for January should be,
Consumption = Opening Inventory + Purchases - Closing Inventory
446875 = 18600 + Purchases - 12800
446875 + 12800 - 18600 = Purchases
Purchases = 441075 pounds
The value of Purchases will be = 441075 * 2.1 = $926257.5
Pizza Express Inc. began the Year 2 accounting period with $2,500 cash, $1,400 of common stock, and $1,100 of retained earnings. Pizza Express was affected by the following accounting events during Year 2:
1. Purchased $3,600 of supplies on account.
2. Earned and collected $12,300 of cash revenue.
3. Paid $2,700 cash on accounts payable.
4. Adjusted the records to reflect the use of supplies. A physical count indicated that $250 of supplies was still on hand on December 31, Year 2.
Required
a. Show the effects of the events on the financial statements.
b. Explain the difference between the amount of net income and amount of net cash flow from operating activities.
Answer:
a) I used an excel spreadsheet since there is not enough room here.
b) Net income = $8,950
Cash flows form operating activities =
Net income $8,950
Adjustments to net income:
Increase in account payable $250Net cash from operating activities $9,850
Net income is lower because a company must record revenues and expenses when they happen, not when they are associated with cash flows. This is why a company that makes all credit sales might have a large profit, but a small amount of cash (the opposite of this situation).
The answer is Net income = $8,950
Cash flows from operating activitiesNet income $8,950
Adjustments to net income:
Increase in account payable $250
Net cash from operating activities $9,850
When the Net income is lower because a company must record revenues and also expenses when they happen, and also not when they are associated with cash flows. so This is why a company that makes all credit sales might have a large profit, but a small amount of cash (the opposite of this situation).
Find out more information about Cash flows here:
https://brainly.com/question/26371663
Sarasota Architects incorporated as licensed architects on April 1, 2022. During the first month of the operation of the business, these events and transactions occurred:
Apr. 1 Stockholders invested $24,300 cash in exchange for common stock of the corporation.
1 Hired a secretary-receptionist at a salary of $506 per week, payable monthly.
2 Paid office rent for the month $1,215.
3 Purchased architectural supplies on account from Burmingham Company $1,755.
10 Completed blueprints on a carport and billed client $2,565 for services.
11 Received $945 cash advance from M. Jason to design a new home.
20 Received $3,780 cash for services completed and delivered to S. Melvin.
30 Paid secretary-receptionist for the month $2,024.
30 Paid $405 to Burmingham Company for accounts payable due.
Required:
Journalize the transactions.
Answer:
Date Account Titles and Explanation Debit Credit
Apr. 1 Cash $24,300
Common Stock $24,300
(To record the amount of cash invested into the business)
Apr. 1 No entry for hiring an employee because there is no monetary transaction.
Apr. 2 Office Rent $1,215
Cash $1,215
(To record the payment of office rent by cash)
Apr. 3 Supplies $1,755
Accounts Payable $1,755
(To record the purchase of supplies on account)
Apr. 10 Accounts Receivable $2,565
Service Revenue $2,565
(To record the services provided on account)
Apr. 11 Cash $945
Unearned Service Revenue $945
(To record the receipt of cash for the services to be
provided in future)
Apr. 20 Cash $3,780
Accounts Receivable $3,780
(To record the collection of cash from the
credit services provided)
Apr. 30 Salaries Expense $2,024
Cash $2,024
(To record the payment of salaries by cash)
Apr. 30 Accounts Payable $405
Cash $405
(To record the payment of accounts payable due)
Wells Technical Institute (WTI), a school owned by Tristana Wells, provides training to individuals who pay tuition directly to the school. WTI also offers training to groups in off-site locations. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Its unadjusted trial balance as of December 31 follows along with descriptions of items a through h that require adjusting entries on December 31.
Additional Information:
1. An analysis of WTI's insurance policies shows that $2,542 of coverage has expired.
2. An inventory count shows that teaching supplies costing $2,204 are available at year-end.
3. Annual depreciation on the equipment is $10,170.
4. Annual depreciation on the professional library is $5,085.
5. On September 1, WTI agreed to do five courses for a client for $2,400 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $12,000 cash in advance for all five courses on September 1, and WTI credited Unearned Training Fees.
6. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $6,498 of the tuition has been earned by WTI.
7. WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee.
8. The balance in the Prepaid Rent account represents rent for December.
Debit Credit
Cash $26,944
Accounts receivable 0
Teaching supplies 10,362
Prepaid insurance 15,545
Prepaid rent 2,073
Professional library 31,088
Accumulated depreciation—Professional library $9,328
Equipment 72,533
Accumulated depreciation—Equipment 16,582
Accounts payable 37,202
Salaries payable 0
Unearned training fees 11,500
Common stock 11,000
Retained earnings, December 31, 2017 54,908
Dividends 41,452
Tuition fees earned 105,701
Training fees earned 39,379
Depreciation expense—Professional library 0
Depreciation expense—Equipment 0
Salaries expense 49,743
Insurance expense 0
Rent expense 22,803
Teaching supplies expense 0
Advertising expense 7,254
Utilities expense 5,803
Totals $285,600 $285,600
Required:
a. Prepare Wells Technical Institute's income statement for the year 2018.
b. Prepare Wells Technical Institute's statement of retained earnings for the year 2018.
c. Prepare Wells Technical Institute's balance sheet as of December 31, 2018.
Answer:
1. An analysis of WTI's insurance policies shows that $2,542 of coverage has expired.
Dr Insurance expense 2,542
Cr Prepaid insurance 2,542
2. An inventory count shows that teaching supplies costing $2,204 are available at year-end.
Dr Teaching supplies expense 8,158
Cr Teaching supplies 8,158
3. Annual depreciation on the equipment is $10,170.
Dr Depreciation expense 10,170
Cr Accumulated depreciation: equipment 10,170
4. Annual depreciation on the professional library is $5,085.
Dr Depreciation expense 5,085
Cr Accumulated depreciation: professional library 5,085
5. On September 1, WTI agreed to do five courses for a client for $2,400 each. Two courses will start immediately and finish before the end of the year. Three courses will not begin until next year. The client paid $12,000 cash in advance for all five courses on September 1, and WTI credited Unearned Training Fees.
Dr Unearned training fees 4,800
Cr Training fees earned 4,800
6. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an executive with payment due at the end of the class. At December 31, $6,498 of the tuition has been earned by WTI.
Dr Accounts receivable 6,498
Cr Tuition fees earned 6,498
7. WTI's two employees are paid weekly. As of the end of the year, two days' salaries have accrued at the rate of $100 per day for each employee.
Dr Salaries expense 400
Cr Salaries payable 400
8. The balance in the Prepaid Rent account represents rent for December.
Dr Rent expense 2,073
Cr Prepaid rent 2,073
Wells Technical Institute (WTI)
Adjusted Trial Balance
Debit Credit
Cash $26,944
Accounts receivable $6,498
Prepaid rent $0
Teaching supplies $2,204
Prepaid insurance $13,003
Professional library $31,088
Accumulated depreciation: $14,413
Professional library
Equipment $72,533
Accumulated depreciation: $26,752
Equipment
Accounts payable $37,202
Salaries payable $400
Unearned training fees $6,700
Common stock $11,000
Retained earnings $54,908
Dividends $41,452
Tuition fees earned $112,199
Training fees earned $44,179
Depreciation expense: $5,085
Professional library
Depreciation expense: $10,170
Equipment
Salaries expense $50,143
Insurance expense $2,542
Rent expense $24,876
Teaching supplies expense $8,158
Advertising expense $7,254
Utilities expense $5,803
Totals $307,753 $307,753
a) Wells Technical Institute (WTI)
Income Statement
For the year ended December 31, 2018
Revenue:
Tuition fees earned $112,199 Training fees earned $44,179 $156,378Operating expenses:
Depreciation expense $15,255 Salaries expense $50,143 Insurance expense $2,542 Rent expense $24,876 Teaching supplies expense $8,158 Advertising expense $7,254 Utilities expense $5,803 ($114,031)Operating income $42,347
b)Wells Technical Institute (WTI)
Balance Sheet
For the year ended December 31, 2018
Assets:
Cash $26,944
Accounts receivable $6,498
Teaching supplies $2,204
Prepaid insurance $13,003
Professional library, net $16,675
Equipment, net $45,781
Total assets $111,105
Liabilities:
Accounts payable $37,202
Salaries payable $400
Unearned training fees $6,700
Total liabilities $44,302
Stockholders' Equity:
Common stock $11,000
Retained earnings $55,803
Total stockholders' Equity $66,803
Total liabilities and equity $111,105
c)Wells Technical Institute (WTI)
Statement of Retained Earnings
For the year ended December 31, 2018
Beginning balance January 1, 2018 $54,908
Net income $42,347
Subtotal $97,255
Dividends ($41,452 )
Ending balance December 31, 2018 $66,803
Purple Panda Pharmaceuticals Inc.’s free cash flows (FCFs) are expected to grow at a constant long-term growth rate ( gL ) of 13% per year into the future. Next year, the company expects to generate a free cash flow of $10,000,000. The market value of Purple Panda’s outstanding debt and preferred stock is $75,000,000 and $41,666,667, respectively. Purple Panda has 4,500,000 shares of common stock outstanding, and its weighted average cost of capital (WACC) is 19%.Given the preceding information, complete the adjacent table (rounding each value to the nearest whole dollar), and assuming that the firm has not had any nonoperating assets in its balance sheet. Term Value Value of Operations Value of Firm's Common Equity Value of Common Stock (per share) Oops, a more careful review of Purple Panda's balance sheet actually reports a $2,370,000 portfolio of marketable securities. How does this new information affect the intrinsic value of Purple Panda's common equity (expressed on a per-share basis) assuming no other changes to the Purple Panda financial situation? Review the statements below and select those that accurately describe Purple Panda's financial situation.
A. The intrinsic value of the company's common stock isn't affected by the new information.
B. The intrinsic value of Purple Panda's common stock decreases with the inclusion of the company's marketable securities portfolio into the analysis.
C. The revised intrinsic value of Purple Panda's common stock is $1.27 per share.
D. The intrinsic value of Purple Panda's common stock increases with the inclusion of the company's marketable securities portfolio into the analysis.
Answer:
Total value of PPP = $10,000,000 / (19% - 13%) = $166,666,667
Total equity value = $166,666,667 - $41,666,667 = $125,000,000 (preferred stocks are considered equity)
Common stock equity value = $125,000,000 - $75,000,000 = $50,000,000
Per share value = $50,000,000 / 4,500,000 = $11.11 ≈ $11 (to the nearest $)
Oops, a more careful review of Purple Panda's balance sheet actually reports a $2,370,000 portfolio of marketable securities. How does this new information affect the intrinsic value of Purple Panda's common equity (expressed on a per-share basis) assuming no other changes to the Purple Panda financial situation? Review the statements below and select those that accurately describe Purple Panda's financial situation.
A. The intrinsic value of the company's common stock isn't affected by the new information.Marketable securities are short term investments (included in current assets). Since we are not given any more information regarding PPP's assets nor how it earns a profit, we cannot determine for sure if this discovery affects stock. personally, I believe it shouldn't unless the securities include high risk stocks that could affect the companies future earnings. We determined the price of PPP based on its future cash flows, not based on its assets.
This information relates to Sheffield Real Estate Agency.
Oct. 1 Stockholders invest $33,860 in exchange for common stock of the corporation.
2 Hires an administrative assistant at an annual salary of $31,320.
3 Buys office furniture for $3,850, on account.
6 Sells a house and lot for E. C. Roads; commissions due from Roads, $10,620 (not paid by Roads at this time).
10 Receives cash of $220 as commission for acting as rental agent renting an apartment.
27 Pays $790 on account for the office furniture purchased on October 3.
30 Pays the administrative assistant $2,610 in salary for October.
Required:
Prepare the debit-credit analysis for each transaction.
Answer:
cash 33,860 debit (+assests)
common stock 33,860 credit (+equity)
---
no entry required
--
furniture 3,850 debit (+assets)
account payable 3,850 credit (+liabilities)
---
accounts receivables 10,620 debit (+assets)
commissions revenues 10,620 credit (+revenue / +equity)
---
cash 220 debit (+assets)
commissions revenues 220 credit (+revenue / +equity)
---
Accounts Payable 790 debit (- liaiblities)
cash 790 credit (- assets)
---
Salaries expense 2,610 debit (+ expense / - equity)
cash 2,610 credit (-assets)
Explanation:
We do the journal entries following the accounting rules
debit = credit
and we usethe accoutnign equation analysis
Assets + Expenses = Liablities + Equity + Revenues
DEBIT CREDIT DEBIT CREDIT
+ + + - - - - - - + + +
The left side increase from debit and decrease from credit
while the element of the right side increase through credit and decrease by debit
Vandalay Industries manufactures two products: toasters and blenders. The annual production and sales of toasters is 2100 units, while 1600 units of blenders are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Toasters require 1.25 direct labor hours per unit, while blenders require 1 direct labor hours per unit. The total estimated overhead for the period is $149,315. The company is looking at the possibility of changing to an activity-based costing system for its products. If the company used an activity-based costing system, it would have the following three activity cost pools:
Expected activity
Estimated
Activity cost Overhead
pool cost Toasters Blenders Total
Setup costs $8,585 215 batches 450 batches 665 batches
Engineering costs $73,980 870 engineering 820 engineering 1,690 engineering
hours hours
Maintenance costs $66,750 2,7250 direct 1,195 direct 3,945 direct
labor hours labor hours labor hours
Total $149,315
The overhead cost per Blenders using the traditional costing system would be closest to:____.
A. $28.27.
B. $37.85.
C. $93.32.
D. $19.40.
Answer:
a. Overhead cost per blender = $28.27
Explanation:
Overhead rate = $149,315 / 3,945
Overhead rate = $37.85
Overhead cost per blender = (Blender Direct labor hours * Overhead rate) / Units of blunder Produced and sold
Overhead cost per blender = (1,195 * $37.85) / 1,600
Overhead cost per blender = $45,230.75 / 1,600
Overhead cost per blender = $28.27
This activity is important marketing managers need to understand how buy-classes affect organizational buying behavior. Organizations face three different types of buying situations called buy-class situations; new buy, straight rebuy, and modified rebuys. The type of buy-class affects the way buying centers make purchase decisions.
The goal of this exercise is to demonstrate your understanding of the three different types of buy-classes.
Hover over the product name to reveal the hint. Then match the product with the correct buy-class situation
Legal pads and pens
Service trucks
Shipping crane
Solar panels
Copier paper
Record-keeping software
Buy-Class Situation New Buy Straight Rebuy Modified Rebuy
Question attached
Answer and Explanation:
New buy: solar panels, shipping cranes
Straight rebuy: legal pads and pens, copier paper
Modified rebuy : service trucks, record keeping software
New buy is typical of buyers who are buying a product for the first time and have no previous experience about it and therefore need to research and make proper buying decision
Straight rebuy: this class buy these products regularly and so do not need to make a critical decision.
modified rebuy: this buy class only need that the product be modified albeit the same product but with slightly different specifications. They have some experience as they have previously purchased the product. Example a company ordering for new logos and business cards.
Different products belong to different economical classes.
Different products and economical classesNew buy Straight Re-buy Modified Re-buy
Solar panels Legal pads and pan Service trucks
Shipping crane Copier paper Record-keeping software
Buyers in the new buy class have never purchased a product before. Because the customer is making their first purchase, they must be included in the decision-making process.
Buyers in the straight-buy category buy the product on a regular basis. As a result, less input is required.
Modified rebuy: Buyer has some product purchase experience.
Find out more information about 'Buyers'.
https://brainly.com/question/8394668?referrer=searchResults
During 2009, Raines Umbrella Corp. had sales of $746,000. Cost of goods sold, administrative and selling expenses, and depreciation expenses were $578,000, $103,000, and $130,000, respectively. In addition, the company had an interest expense of $97,000 and a tax rate of 40 percent. (Ignore any tax loss carryback or carryforward provisions.) Assume Raines Umbrella Corp. paid out $18,000 in cash dividends, spending on net fixed assets and net working capital was zero, and no new stock was issued during the year.What is the firm’s:______.
1- Cash Flow from Assets?
2- Cash Flow to Shareholders?
3- Cash Flow to Creditors?
4- Net new Long-term Debt?
Answer:
1 $65,000
2 $18,000
3 $47,000
4 $50,000
Explanation:
1. Cash flow from Assets = $65,000
2. Cash flow to Shareholders = Dividend = $18,000
3. Cash flow to Creditors = $47,000
4. Net new long term debt = $50,000
Please find attached explanations to the answers above.
Indicate whether the following statements about the conceptual framework are true or false. (a) Accounting rule-making that relies on a body of concepts will result in useful and consistent pronouncements. select an option (b) General-purpose financial reports are most useful to company insiders in making strategic business decisions. select an option (c) Accounting standards based on personal conceptual frameworks generally will result in consistent and comparable accounting reports. select an option (d) Capital providers are the only users who benefit from general-purpose financial reporting. select an option (e) Accounting reports should be developed so that users without knowledge of economics and business can become informed about the financial results of a company. select an option (f) The objective of financial reporting is the foundation from which the other aspects of the framework logically result.
Answer:
Explanation:
(a) Accounting rule-making that relies on a body of concepts will result in useful and consistent pronouncements. select an option (TRUE)
This is true be
(b) General-purpose financial reports are most useful to company insiders in making strategic business decisions. select an option (FALSE)
This is false because General-purpose financial reports are most useful to investors as well as shareholders. And it let us financial information about a particular business.
(c) Accounting standards based on personal conceptual frameworks generally will result in consistent and comparable accounting reports. select an option(FALSE)
This is false because Accounting standards based on personal conceptual frameworks will have a diverse report, that cannot be compared.
(d) Capital providers are the only users who benefit from general-purpose financial reporting. select an option (FALSE)
(e) Accounting reports should be developed so that users without knowledge of economics and business can become informed about the financial results of a company. select an option(FALSE)
(f) The objective of financial reporting is the foundation from which the other aspects of the framework logically result.(TRUE)