Answer and Explanation:
Life Inc.
Statement of Cash Flows
For Year Ended December 31, 2018
A. Effect of events on Accounting Equation
S. no. Event Assets = Liabilities +
Stockholders' Equity
Cash Prepaid Rent = Retained Earnings
1. Performed
Counseling
services $21,200 $21,200
2. Prepaid Rent -$14,400 $14,400
3. Used Rent -$13,200 -$13,200
($14,400 × 11 ÷ 12)
Total $6,800 $1,200 $8,000
B. The preparation of Income statement is prepared below:-
Life Inc.
Income statement
For the year 1
Particulars Amount
Service Revenue $21,200
Rent Expense -$13,200
Net Income $8,000
Life Inc.
Balance Sheet
For the year 1
Particulars Amount
Assets:
Cash $6,800
Prepaid Rent $1,200
Total Assets $8,000
Liabilities & Stockholder's Equity:
Retained Earnings $8,000
Total liabilities and
Stockholder's Equity $8,000
Life Inc.
Statement of Cash Flows
For Year 1
Particulars Amount
Cash Flows from operating activities:
Cash received from
customers $21,200
Cash paid for rent -$14,400
Net Cash provided by operating
activities $ 6,800
Cash flow from investing
activities $0.00
Cash flow from financing
activities $0.00
Net Increase (Decrease) in
Cash $6,800
Cash balance at the beginning
of year $0.00
Cash balance at end of year $6,800
c. The computation of the amount of rent expense that would be recognized in Year 2 is shown below:-
Amount of rent expense that will be recognized in Year 2 = Ending balance in prepaid rent = $1,200
The cost of direct materials would most likely be a(n): a. Variable cost. b. Fixed cost. c. Indirect cost. d. Differential cost.
Answer:
a. Variable cost
Explanation:
Direct Materials are traceable to cost object (product) and they usually vary with the quantities produced. Thus cost of direct materials would most likely be Variable cost.
Listed below are costs found in various organizations:
1. Property taxes, factory
2. Boxes used for packaging detergent produced by the company.
3. Salespersons' commissions.
4. Supervisor's salary, factory
5. Depreciation, executive autos.
6. Wages of workers assembling computers.
7. Insurance, finished goods warchouses.
8. Lubricants for production equipment.
9. Advertising costs.
10. Microchips used in producing calculators
11. Shipping costs on merchandise sold.
12. Magazine subscriptions, factory lunchroom.
13. Thread in a garment factory.
14. Executive life insurance.
15. Ink used in textbook production.
16. Fringe benefits, assembly-line workers.
17. Yarn used in sweater production.
18. Wages of receptionist, executive offices.
Required:
a. Prepare an answer sheet.
b. For each cost item, indicate whether it would be variable or fixed with respect to the number of units produced and sold and then whether it would be a selling cost, an administrative cost or a manufacturing cost.
Answer:
Answer sheet required more space then was available so I attached it as a picture.
National Orthopedics Co. issued 8% bonds, dated January 1, with a face amount of $550,000 on January 1, 2021. The bonds mature on December 31, 2024 (4 years). For bonds of similar risk and maturity the market yield was 10%. Interest is paid semiannually on June 30 and December 31. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
Required:
1. Determine the price of the bonds at January 1, 2021.
2. Prepare the journal entry to record their issuance by National on January 1, 2021.
3. Prepare an amortization schedule that determines interest at the effective rate each period.
4. Prepare the journal entry to record interest on June 30, 2021.
5. Prepare the appropriate journal entries at maturity on December 31, 2024.
Answer:
1) the price of each bond:
PV of face value = $1,000 / 1.05⁸ = $676.84
PV of coupon payments = $40 x 6.4632 (PV annuity factor, 5%, 8 periods) = $258.53
market price per coupon = $935.37
2) journal entry to record issuance of the bonds:
January 1, 2021, bonds issued at a discount
Dr Cash 514,453.50
Dr Discount on bonds payable 35,546.50
Cr Bonds payable 550,000
3) I used an excel spreadsheet
4) June 30, 2021, first coupon payment
Dr Interest expense 25,722.68
Cr Cash 22,000
Cr Discount on bonds payable 3,722.68
5) December 31, 2024, last coupon payment
Dr Interest expense 27,236.45
Cr Cash 22,000
Cr Discount on bonds payable 5,236.45
December 31, 2024, bonds are redeemed
Dr Bonds payable 550,000
Cr Cash 550,000
On March 1, 2021, Stratford Lighting issued 10% bonds, dated March 1, with a face amount of $690,000. The bonds sold for $678,000 and mature on February 28, 2041 (20 years). Interest is paid semiannually on August 31 and February 28. Stratford uses the straight-line method and its fiscal year ends December 31.
Required:
Prepare the journal entries to record the issuance of the bonds by Stratford Lighting on March 1, 2021, interest on August 31, 2021, accrued interest on December 31, 2021 and interest on February 28, 2022.
Answer and Explanation:
The Journal entries are shown below:-
1. Cash Dr, $678,000
Discount on bonds payable Dr, $12,000
To Bonds payable $690,000
(Being issuance of the bonds is recorded)
2. Bond interest expense $34,800
To Discount on bonds payable $ 300 ($12,000 ÷ 40)
To Cash $34,500 ($690,000 × 0.10 × 0.5)
(Being interest is recorded)
3. Bond interest expense Dr, $23,200
To Discount on bonds payable $200 ($300 × 4 ÷ 6)
To Bond interest payable $23,000 ($34,500 × 4 ÷ 6)
(Being accrue interest is recorded)
4. Bond interest payable Dr, $23,000
Bond interest expense $11,600 ($23,200 ÷ 2)
To Discount on bonds payable $100
To Cash $34,500
(Being interest is recorded)
Imagine that your friend is the CEO of a company, called Magna Clothes, that manufactures cool new clothing accessories for both men and women. Now that it has achieved a large following and a level of success in the United States, Magna Clothes wants to start conducting business abroad. Your friend knows you have taken a management class and has asked you to explain the history and significance of the World Trade Organization (WTO). Which of the following statements are true?
a. The WTO seeks to establish impartial procedures for resolving trade disputes among its members.
b. The WTO seeks to reduce remaining trade barriers through multilateral negotiations.
c. The WTO is headquartered in Belgium.
d. Existence of the WTO has allowed most member countries to replace their local currencies with a universal currency beginning in 2002.
Answer:
a) & b) are true. c) & d) are false.
Explanation:
WTO is an international (intergovernmental) organisation, supervising international trade between countries.
a) is true. It seeks to establish impartial procedures for resolving trade disputes among its members.
It seeks to reduce remaining trade barriers through multilateral negotiations, b) is true
c) is false. It is headquartered in Geneva, Switzerland (not Belgium)
d) is false. Existence of the WTO has allowed most member countries to replace their local currencies with a universal currency beginning in 2002. It is an international trade organisation, not monetary policy organisation.
You have a co-worker at work that you are also friends with. One day, a borrower comes in and meets with him. You overhear the borrower tell your co-worker that he has a loan with his mom and dad for about $10,000 that he pays $300 a month. Your co-worker proceeds as if he didn’t hear your borrower at all. Once he has taken the application, he tells the borrower that he qualifies for maximum financing for a $250,000 home. However, that does NOT take into consideration the $300 a month the borrower pays his parents for the loan.
Did your coworker do anything unethical in this transaction?
Assuming you feel this was an unethical situation, how do you handle this? Remember, this is your friend and co-worker
Answer:
1. My co-worker has indeed done something unethical as it goes against the ethics of the financial profession. By ignoring the outstanding loan that the applicant has with his parents in his risk assessment of the applicant, he has opened the company to more risk exposure that could be costly to the company. My co-worker has therefore been derelict in his duty for whatever reason and engaged in unethical conduct.
2. As this is my co-worker and friend, I would not think to get him in trouble as a first resort by reporting to our immediate manager. Rather I will go an discuss with him to make him see the error in what he just did because it might have been a mistake.
I will advise him to call the applicant back and reduce the available financing. On the off chance he refuses, I would be forced to report him to our supervisor/ manager.
Wingate Company, a wholesale distributor of electronic equipment, has been experiencing losses for some time, as shown by its most recent monthly contribution format income statement: Sales $ 1,556,000 Variable expenses 591,640 Contribution margin 964,360 Fixed expenses 1,061,000 Net operating income (loss) $ (96,640) In an effort to resolve the problem, the company would like to prepare an income statement segmented by division. Accordingly, the Accounting Department has developed the following information: Division East Central West Sales $ 386,000 $ 600,000 $ 570,000 Variable expenses as a percentage of sales 44 % 38 % 34 % Traceable fixed expenses $ 297,000 $ 331,000 $ 208,000 Required: 1. Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $27,000 based on the belief that it would increase that division's sales by 17%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented
Answer:
1. Image 1
2a. The company's net operating income decreases by $156,326
2b. No
Explanation:
Please find attached solution to question 1 and 2a.
2b. No. I wouldn't recommend the increased advertising because already the company is making a loss. Moreover, with the increased advertising, the company's net operating loss further increased.
Finance, or financial management, requires the knowledge and precise use of the language of the field. Match the terms relating to the basic terminology and concepts of the time value of money on the left with the descriptions of the terms on the right. Read each description carefully and type the letter of the description in the Answer column next to the correct term. These are not necessarily complete definitions, but there is only one possible answer for each term.
Discounting:A. Concept that maintains that the owner of a cash flow will value it differently, depending on when it occur.
Time value of money terms:B. The amount towhich an ndividual cash flow or series of cash payments or receipt ewill grow over a period of time when earning interest at a given rate of interest.
Amortized loan:C. A type of security that is frequently used in mortgages and requres that the loan payment contain both interest and loan principal.
Ordinary annulty:D. An interest rate that reflects the return required by a lender and paid by a borrower, expressed as a percentage of the principal borrowed.
Annual percentage rate:E. A series of equal cash flows that occur at the end of each of the equally rate spaced intervals (such as daily, monthly, quarterly, and so on)
Annuity due: F. A table that reports the results of the disaggregation of each payment on an amortized loan, such as a mortgage, into its interest and loan repayment components.
Perpetuity:G. A process that involves calc lating the current value of a future cash flow or series of cash flows based on a certain interest rate Future value:H. A rate that represents the return on an investor's best available alternative investment of equal risk.
Amortization schdule:I. A series of equal (constant) cash flows (receipts or payments) that are schedule expected to continue forever
Opportunity cost of funds:J. A series of equal cash flows that occur at the beginning of each of the equaly spaced intervas (such as daily, monthly, quarterly, and so on)
Time value of money calculations can be solved using a mathernatical equation, a financial calculator, or a spreadsheet. Which of the following equations can be used to solve for the present alue of an annuity due?
A. PMT x (1-(1/ (1 + r)/r) x (1 +r)
B. PMT x (1-(1/ (1 + r)n]}
C. PMT/r
D. PMT x{[(1+r)n-1]/r*(1+r)
Answer:
1. Time value of money.
2. Future value.
3. Amortized loan.
4. Annual percentage rate.
5. Annuity due.
6. Amortization schedule.
7. Discounting.
8. Opportunity cost of funds.
9. Perpetuity.
10. Ordinary annuity.
11. A
Explanation:
1. Time value of money: concept that maintains that the owner of a cash flow will value it differently, depending on when it occur.
2. Future value: the amount to which an individual cash flow or series of cash payments or receipt will grow over a period of time when earning interest at a given rate of interest.
3. Amortized loan: a type of security that is frequently used in mortgages and requires that the loan payment contain both interest and loan principal.
4. Annual percentage rate: an interest rate that reflects the return required by a lender and paid by a borrower, expressed as a percentage of the principal borrowed.
5. Annuity due: A series of equal cash flows that occur at the end of each of the equally rate spaced intervals (such as daily, monthly, quarterly, and so on)
6. Amortization schedule: a table that reports the results of the disaggregation of each payment on an amortized loan, such as a mortgage, into its interest and loan repayment components.
7. Discounting: a process that involves calculating the current value of a future cash flow or series of cash flows based on a certain interest rate.
8. Opportunity cost of funds: a rate that represents the return on an investor's best available alternative investment of equal risk.
9. Perpetuity: a series of equal (constant) cash flows (receipts or payments) that are schedule expected to continue forever.
10. Ordinary annuity: a series of equal cash flows that occur at the beginning of each of the equally spaced intervals (such as daily, monthly, quarterly, and so on).
11. PMT x (1-(1/ (1 + r)/r) x (1 +r): an equation that can be used to solve for the present value of an annuity due. It is known as Present Value of an Annuity.
Cross Roads Manufacturing currently uses a traditional costing system. The company allocates overhead to its two products, Zips and Dees, using a predetermined manufacturing overhead rate based on direct labor hours. Here is data related to the company's two products:
Zips Dees
Direct materials per unit $140.00 $100.00
Direct labor per unit $55.00 $50.00
Direct labor hours per unit 2.0 1.5
Annual production 25,000 40,000
Information about the company's estimated manufacturing overhead for the year follows:
Activities Activity measures Estimated overhead cost
Supervision and maintenance Direct labor hours $2,200,000
Batch costs Number of batches $212,500
Engineering changes Number of engineering hours $180,000
Total estimated manufacturing overhead for the year $2,592,500
Expected activity
Zips Dees Total
Supervision and maintenance 50,000 60,000 110,000
Batch costs 2,000 500 2,500
Engineering changes 1,800 1,200 3,000
The amount of manufacturing overhead that would be allocated to one unit of Zips using an activity-based costing system would be closest to:
a. $32.86.
b. $11.95.
c. $51.12.
d. $64.81.
Answer:
c. $51.12.
Explanation:
Total activity cost of supervision and maintenance activity for Product Z.
Total activity cost = Activity based cost per unit * Number of units on which activity is performed
= Activity based cost per direct labor hour * Direct labor hours of Product Z
= $20 per direct labor hour * 50,000 hours
= $1,000,000
Total activity cost of batch costs activity for Product Z
Total activity cost = Activity based cost per unit * Number of units on which activity is performed
= Activity based cost per batch * Number of batches of Product Z
= $85 per batch * 2,000 batches
= $170,000
Total activity cost of engineer changes activity for Product Z
Total activity cost = Activity based cost per unit * Number of units on which activity is performed
=Activity based cost per engineer hour * Engineer hours of Product Z
= $60 per engineer hour×1,800 batches
= $108,000
Total overheads = Activity cost of supervision and maintenance + Activity cost of batch cost + Activity cost of engineer changes
=$1,000,000 + $170,000 + $108,000
=$1,278,000
Overhead per unit=Total overheads / Annual production
= $1,278,000/25,000 units
= $51.12 per unit
A company has the following adjusted trial balance:________. Account Debit Credit Cash $1,100 Accounts Receivable 1,000 Inventory 1,900 Supplies 1,800 Prepaid Rent 400 Land 5,800 Building 40,500 Accumulated Depreciation—Building $8,900 Accounts Payable 7,800 Unearned Revenue 4,000 Notes Payable, due 2020 2,400 Common Stock 6,600 Retained Earnings 3,200 Dividends 900 Service Revenue 32,200 Rent Expense 1,500 Supplies Expense 1,200 Salaries Expense 6,100 Depreciation Expense—Building 1,000 Utilities Expense 1,900 Totals $65,100 $65,100 Which closing entry is needed?
Answer: Debit Retained Earnings $900 and credit Dividends $900
Explanation:
When accounting for dividends at the end of the year they should be removed from the Retained Earnings because this is the account that they will be funded from.
As Retained Earnings is an Equity account, when it is reduced it will be debited so in this case the $900 for dividends will be debited. The Dividends being a temporary account are debited when the Dividends are declared by the company during the year.
When the company wants to close off the account they will then transfer it to the Retained Earnings account by crediting it.
Blast it! said David Wilson, president of Teledex Company. "We’ve just lost the bid on the Koopers job by $4,000. It seems we’re either too high to get the job or too low to make any money on half the jobs we bid."
Teledex Company manufactures products to customers’ specifications and uses a job-order costing system. The company uses a plantwide predetermined overhead rate based on direct labor cost to apply its manufacturing overhead (assumed to be all fixed) to jobs. The following estimates were made at the beginning of the year:
Department
Fabricating Machining Assembly Total Plant
Direct labor $215,000 $107,500 $322,500 $645,000
Manufacturing
overhead $376,250 $430,000 $96,750 $903,000
Jobs require varying amounts of work in the three departments. The Koopers job, for example, would have required manufacturing costs in the three departments as follows:
Department
Fabricating Machining Assembly Total Plant
Direct materials $4,500 $500 $2,900 $7,900
Direct labor $5,800 $800 $7,700 $14,300
Manufacturing overhead ? ? ? ?
The company uses plant-wide overhead rate to apply manufacturing overhead cost to jobs.
Required:
1. Assuming use of a plant-wide overhead rate:
A. Compute the rate for the current year.
B. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.
2. Suppose that instead of using a plant-wide overhead rate, the company had used a separate predetermined overhead rate in each department. Under these conditions:
A. Compute the rate for each department for the current year.
B. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.
3. Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost (direct materials, direct labor, and applied overhead).
A. What was the company's bid price on the Koopers job if a plant-wide overhead rate had been used to apply overhead cost?
B. What would the bid price have been if departmental overhead rates had been used to apply overhead cost?
4. At the end of the year, the company assembled the following actual cost data relating to all jobs worked on during the year.
Department
Fabricating Machining Assemble Total Plant
Direct materials $205,000 $17,500 $129,000 $351,500
Direct labor 225,000 123,000 277,000 625,000
Manufacturing
overhead $387,000 $463,000 $86,400 $936,400
Answer:
1. Assuming use of a plant-wide overhead rate:
A. Compute the rate for the current year.
= $903,000 / $645,000 = $1.40 per $ of direct labor costB. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.
= $14,300 x 1.4 = $20,0202. Suppose that instead of using a plant-wide overhead rate, the company had used a separate predetermined overhead rate in each department. Under these conditions:
A. Compute the rate for each department for the current year.
fabricating = $376,250 / $215,000 = $1.75 per $ of direct labor cost machining = $430,000 / $107,500 = $4 per $ of direct labor cost assembly = $96,750 / $322,500 = $0.30 per $ of direct labor costB. Determine the amount of manufacturing overhead cost that would have been applied to the Koopers job.
fabricating = $5,800 x 1.75 = $10,150machining = $800 x $4 = $3,200assembly = $7,700 x $0.30 = $2,310total = $15,6603. Assume that it is customary in the industry to bid jobs at 150% of total manufacturing cost (direct materials, direct labor, and applied overhead).
A. What was the company's bid price on the Koopers job if a plant-wide overhead rate had been used to apply overhead cost?
total production costs = $7,900 + $14,300 + $20,020 = $42,220bid price = $42,220 x 1.5 = $63,330B. What would the bid price have been if departmental overhead rates had been used to apply overhead cost?
total production costs = $7,900 + $14,300 + $15,660 = $37,860bid price = $37,860 x 1.5 = $56,7904. There are no requirements for question 4.
Explanation:
Department
Fabricating Machining Assembly Total Plant
Direct labor $215,000 $107,500 $322,500 $645,000
Man. overhead $376,250 $430,000 $96,750 $903,000
Koopers Job
Fabricating Machining Assembly Total Plant
Direct materials $4,500 $500 $2,900 $7,900
Direct labor $5,800 $800 $7,700 $14,300
Selzik Company makes super-premium cake mixes that go through two processing departments, Blending and Packaging. The following activity was recorded in the Blending Department during July:
Production data:
Units in process, July 1 (materials 100% complete; conversion 30% complete) 10,000
Units started into production 170,000
Units in process, July 31 (materials 100% complete; conversion 40% complete) 20,000
Cost data:
Work in process inventory, July 1:
Materials cost $8,500
Conversion cost $4,900
Cost added during the month:
Materials cost $139,400
Conversion cost $244,200
All materials are added at the beginning of work in the Blending Department. The company uses the FIFO method in its process costing system.
Required:
a. Determine the equivalent units for July for the Blending Department.
b. Compute the costs per equivalent unit for July for the Blending Department.
c. Determine the total cost of ending work in process inventory and the total cost of units transferred to the next process for the Blending Department in July.
d. Prepare a cost reconciliation report for the Blending Department for July.
Answer:
a) EU for materials = 170,000
EU for conversion = 165,000
b) Materials = $0.82 per EU
Conversion = $1.48 per EU
c) Ending WIP = $28,240
Units transferred out = $368,760
d) cost reconciliation report:
Costs to be accounted for:
Beginning WIP $13,400 Cost added $383,600 Total costs to be accounted for $397,000Cost accounted for as follows:
Unit transferred out $368,760 Ending WIP $28,240 Total cost accounted for $397,000Explanation:
beginning WIP 10,000
materials 100% complete (0% added during the period)
conversion 30% complete (70% added during the period) ⇒ 7,000 EU
units started 170,000
ending WIP 20,000
materials 100% complete ⇒ 20,000 EU
conversion 40% complete ⇒ 8,000 EU
units completed = 160,000
units started and completed = 150,000
beginning WIP costs:
Materials cost $8,500
Conversion cost $4,900
costs added during the period:
Materials cost $139,400
Conversion cost $244,200
Equivalent units for July:
EU for materials = 170,000
EU for conversion = 7,000 + 150,000 + 8,000 = 165,000
Costs per EU:
Materials = $139,400 / 170,000 = $0.82 per EU
Conversion = $244,200 / 165,000 = $1.48 per EU
Total costs:
Ending WIP = (20,000 x $0.82) + (8,000 x $1.48) = $28,240
Units transferred out = ($383,600 - $28,240) + $8,500 + $4,900 = $368,760
Costs to be accounted for:
Beginning WIP $13,400 Cost added $383,600 Total costs to be accounted for $397,000Cost accounted for as follows:
Unit transferred out $368,760 Ending WIP $28,240 Total cost accounted for $397,000Following are income statements for Hossa Corporation for 20X1 and 20x2. Percentage of sales amounts are also shown for each operating expense item. Hossa's income tax rate was 22% in 20X1 and 24% in 20X2
2011 2012
($ in millions) ($ in millions) of sales % ($ in millions) of sales % Sales
Cost of sales $5,500.0 $6,500.0
Other operating expenses (2,475.0) 45% (3,055.0) 47%
Operating income (825.0) 15% (1,040.0) 16%
Provision for income taxes 2,200.0 2,405,0
Net income 484.0 (577.2)
Income tax rate $1,716.0 $2,827.8
22% 24%
Hossa’s management was pleased that 20X2 net income was up 6.5% from the prior year. Although you are also happy with the increase in net income, you are not so sure the news is all positive. You have modeled Hossa’s income as follows:
NET INCOME = SALES × (1 − COGS% − OPEX%) × (1 − TAX RATE)
Using this model, net income in 20X1 is computed as $5,500 × (1 − 45% − 15%) × (1 − 22%) = $1,716.0. Net income in 20X2 is computed as $6,500 × (1 − 47% − 16%) × (1 − 24%) = $1,827.8.
Required:
Prepare a cause-of-change analysis to show the extent to which each of the following items contributed to the $111.8 million increase in Hossa’s net income from 20X1 to 20X2: (Do not round intermediate calculations.
Increase in sales (SALES)
Increase in cost of sales as a percent of sales (COGS%)
Increase in other operating expenses as a percent of sales (OPEX%)
Increase in income tax rate (TAX RATE)
Please find full question attached Answer and Explanation:
Please find full answer and explanation attached
We have done a change analysis using data from Hossa's net income statement
From the analysis we can observe that only increase in sales brings a positive effect and therefore the result of increase in net income
Crane Company has these comparative balance sheet data:
CRANE COMPANY Balance Sheets December 31
2020 2019
Cash $33,900 $67,800
Accounts receivable (net) 158,200 135,600
Inventory 135,600 113,000
Plant assets (net) 452,000 406,800
$779,700 $723,200
Accounts payable $113,000 $135,600
Mortgage payable (15%) 226,000 226,000
Common stock, $10 par 316,400 271,200
Retained earnings 124,300 90,400
$779,700 $723,200
Additional information for 2020:
1. Net income was $29,200.
2. Sales on account were $379,100. Sales returns and allowances amounted to $28,000.
3. Cost of goods sold was $203,800.
4. Net cash provided by operating activities was $58,000.
5. Capital expenditures were $27,500, and cash dividends were $19,600.
Compute the following ratios at December 31, 2017. Round current ratio to 2 decimal places, and all other answers to 1 decimal place, Use 365 days for calculation.
a. Current ratio _______:1
b. Accounts receivable turnover _______times
c. Average collection period _______days
d. Inventory turnovefr _______times
e. Days inventory _______days
f. Free cash flow $_______
Answer and Explanation:
A. Current ratio= current assets/current liabilities
= 33900+158200+135600/113000 = 2.9
B. Account Receivable Turnover = Sales/ Average account receivables
= 379100 -28000/158200+135600/2) = 2.39
c) Average collection period =
365/ account receivable turnover
= 365/2.39 =
152.72 days
D. inventory turnover = cost of goods sold / average inventory
= 203800/135600+113000/2 = 1.64
E. Days in inventory = 365/inventory turnover=
365/1.64 = 222.561 Days
F. Cash debt coverage
= cash from operating activities - dividend / total debt
= (58000 - 19600 )/(226000) = 0.17
G. Current cash debt coverage = net cash provided by the operating activities / average current liabilities
=58000 /113000 + 135600/2) = 0.467
H. Cash flow available = cash flow from operating activities - Capital Expenditure- Cash Dividend
$(58000-27500-19600)
= $10900
A Georgia state law requires the use of contoured rear-fender mudguards on trucks and trailers operating within Georgia state lines. The statute further makes it illegal for trucks and trailers to use straight mudguards. In approximately thirty-five other states, straight mudguards are legal. Moreover, in Florida, straight mudguards are explicitly required by law. There is some evidence suggesting that contoured mudguards might be a little safer than straight mudguards.
a. Discuss whether this Georgia statute violates any constitutional provisions.
b. State the law, define it apply it and make your conclusion. Richard is an employee of the Dun Construction Corp. While delivering materials to a construction site, he carelessly backs Dun's truck into a passenger vehicle driven by Green. This is Richard's second accident in six months. When the company owner, Dun, learns of this latest accident, a heated discussion ensues, and Dun fires Richard. Dun is so angry that he immediately writes a letter to the union of which Richard is a member and to all other construction companies in the community, stating that Richard is the "worst driver in the city" and that "anyone who hires him is asking for legal liability". Richard files a suit against Dun, alleging libel on the basis of the statements made in the letters. Discuss the results.
Answer: Defamation.
Explanation:
The state has the power to make laws which protect, and maintain the order and general safety of its citizens. The state of Georgia has found that contoured mud glass are safer unlike straight mud glass. The state statue has the potential of affecting trade and commerce because this trucks are used in the haulage of goods and services from one state to another.
B. Defamation.
what Dun has done is a defamation of character on the part of Richard. This is because of the words used in Dun letters sent to the union Richard belonged to and other constirction company’s was intended to Harm the reputation and values Richard has worked hard to achieve.
A company has two classes of stock authorized: 9%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during Year 1, its first year of operations:______.
January 2 Issues 100,000 shares of common stock for $29 per share.
February 6 Issues 2,400 shares of 9% preferred stock for $11 per share.
September 10 Purchases 11,000 shares of its own common stock for $34 per share.
December 15 Resells 5,500 shares of treasury stock at $39 per share.
In its first year of operations, the company has net income of $154,000 and pays dividends at the end of the year of $94,500 ($1 per share) on all common shares outstanding and $2,160 on all preferred shares outstanding. Required:
Prepare the stockholders' equity section of the balance sheet for the company as of December 31, Year 1.
Answer:
Stockholders' EquityPreferred 9% Stock, $10 par value
(2,400 stocks authorized) $24,000
Paid-in Capital in Excess of Par $2,400 $26,400
Common Stock
(94,500 stocks outstanding) $100,000
Paid-in Capital in Excess of Par $2,827,500 $2,927,500
Total paid in capital $2,953,900
Retained Earnings $59,500
Treasury Stock (5,500 stocks at cost) ($187,000)
Total Stockholders' Equity $2,826,400
Explanation:
Jan. 2 Issued 100,000 shares of common stock for $2,900,000.
Dr Cash 2,900,000
Cr Common stock 100,000
Cr Paid-in capital in excess of par value - common stock 2,800,000
February 6 Issues 2,400 shares of 9% preferred stock for $11 per share.
Dr Cash 26,400
Cr Preferred stock 24,000
Cr Paid-in capital in excess of par value - preferred stock 2,400
September 10 Purchases 11,000 shares of its own common stock for $34 per share.
Dr Treasury stock 374,000
Cr Cash 374,000
December 15 Resells 5,500 shares of treasury stock at $39 per share.
Dr Cash
Cr Treasury stock 187,000
Cr Paid-in capital in excess of par value - common stock 27,500
retained earnings = $154,000 - $94,500 = $59,500
Preferred Stock $24,000
Common Stock $100,000
Paid-in capital in excess of par value - preferred stock $2,400
Paid-in capital in excess of par value - common stock $2,827,500
Retained Earnings $59,500
Treasury Stock $187,000
Company B Company B is an IT hosting company that provides a range of shared services used by a wide variety of customers. One of Company B's customers is Company A
Answer and Explanation:
Specifically the following cloud characteristics will aid company B in retaining it's customers:
First cloud services allows a broader network and larger storage facilities. With cloud technology Company Will be able to get their services on a goat of devices: smartphone, tablets, phablets, thereby increasing accessibility for company A's customers. Also there is greater storage facilities available with cloud services
Second third party cloud services could now become an option as company is able to utilize the services of big cloud services companies in providing it's software to company B clients. This would boost security for it's software as well as greater accessibility and service level.
Ben: We need to select the team members for the Dragon Owls project. I have identified seven essential skills we need to make this project successful: leadership skills, creative skills, conceptual skills, collaborative skills, technical skills, interpersonal skills, and planning skills. Therefore, we should bring at least seven people on to the team.
Steve: Instead, we should identify all of the departments that have a stake in the success of the Dragon Owls project and ensure that a representative from each department is on the Dragon Owls team.
Curtis: I have a better idea. Since the Dragon Owls success is so important, it should contain the top performers in the entire organization.
Which of the following is assumed by Ben's argument?
a. No potential member of the Dragon Owls project has better leadership skills than conceptual skills.
b. Every potential member of the Dragon Owls project has outstanding skills in at least one respect.
c. Some potential members of the Dragon Owls project have creative skills and planning skills.
d. No potential member of the Dragon Owls team has both conceptual skills and interpersonal skills.
e. Every potential member of the Dragon Owls team with technical skills also has collaborative skills.
Answer:
b.
Explanation:
Based on Ben's idea he is stating that every potential member of the Dragon Owls project has outstanding skills in at least one respect. He seems to know that potential candidates can possess various skills that may be useful to the overall project. Since he has identified seven key skills that are detrimental to the success of the project, he basically wants at least one member of the project that has an exceptional skill level in at least one of the needed skills. That way by having seven members, each of which is exceptional at one of these skills then he would have experts in every skill to get the project done right.
Record year-end adjusting entries (LO3-3) Below are transactions for Wolverine Company during 2021. On December 1, 2021, Wolverine receives $4,000 cash from a company that is renting office space from Wolverine. The payment, representing rent for December and January, is credited to Deferred Revenue. Wolverine purchases a one-year property insurance policy on July 1, 2021, for $13,200. The payment is debited to Prepaid Insurance for the entire amount. Employee salaries of $3,000 for the month of December will be paid in early January 2022. On November 1, 2021, the company borrows $15,000 from a bank. The loan requires principal and interest at 10% to be paid on October 30, 2022. Office supplies at the beginning of 2021 total $1,000. On August 15, Wolverine purchases an additional $3,400 of office supplies, debiting the Supplies account. By the end of the year, $500 of office supplies remains.Required:
Record the necessary adjusting entries at December 31, 2021, for Wolverine Company. You do not need to record transactions made during the year. Assume that no financial statements were prepared during the year and no adjusting entries were recorded. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field. Do not round intermediate calculations.)
Answer: See explanation
Explanation:
1. Dr Deferred revenue 2,000
Cr. Rent revenue 2,000
2 Dr. Insurance expense 6,600
Cr. Prepaid insurance 6,600
3 Dr Salaries expense 3,000
Cr Salaries payable 3,000
4 Dr Interest expense 250
Cr Interest payable 250
5 Dr Supplies expense 3,900
Cr Supplies. 3900
N. B:
Rent revenue for December was calculated as:
= $4,000 x 1/2
= $2,000
Insurance expense for the current year was calculated as:
= $13,200 x 6/12
= $6,600
Interest expense:
= $15,000 x 10% x 2/12
= $15000 × 0.1 × 2/12
= $250
Supplies expense:
= $1,000 + $3,400 - $500
= $3,900
Merchandise with a list price of $7,500 and a cost of $7,000 is sold on account, terms 1/10, n/30. Prior to payment, merchandise with a list price of $1,000 and a cost of $800 is returned. The correct amount is paid within the discount period. Record the following transactions, using the integrated financial statement framework that follows:_______. a. Sold the merchandise. If a financial statement doesn't require an entry, select "No Effect" and enter "0" in amount field. Assets = Liabilities + Stockholders' Equity Cash Accounts Receivable Merchandise Inventory Accounts Payable Capital Stock Retained Earnings 7,500 7,000 500 Statement of Cash Flows Income Statement No Effect $ Sales $ 7,500 Cost of Goods Sold 7,000 500 b. Received the returned merchandise. If a financial statements doesn't require an entry, select "No Effect" and enter "0" in amount field. Assets = Liabilities + Stockholders' Equity Cash Accounts Receivable Merchandise Inventory Accounts Payable Capital Stock Retained Earnings 1,000 800 200 Statement of Cash Flows Income Statement No Effect $ Sales Ret & Allow 1,000 Cost of Goods Sold 800 200 c. Received the amount owed. If all the financial statements doesn't require any entry. Select "No Effect" and enter "0" in amount field. Assets = Liabilities + Stockholders' Equity Cash Accounts Receivable Merchandise Inventory Accounts Payable Capital Stock Retained Earnings 7,000 7,000 Statement of Cash Flows Income Statement Operating $ Sales Discounts
Answer:
I used an excel spreadsheet since there is not enough room here.
Explanation:
Selected transactions for Grouper’s Dog Care are as follows during the month of March.
March 1 Paid monthly rent of $1,030.
3 Performed services for $120 on account.
5 Performed services for cash of $65.
8 Purchased equipment for $515. The company paid cash of $70 and the
balance was on account.
12 Received cash from customers billed on March 3.
14 Paid wages to employees of $450.
22 Paid utilities of $62.
24 Borrowed $1,290 from Grafton State Bank by signing a note.
27 Paid $190 to repair service for plumbing repairs.
28 Paid balance amount owed from equipment purchase on March 8.
30 Paid $1,550 for six months of insurance.
Journalize the transactions.
Answer and Explanation:
The Journal entries are shown below:-
1. Rent expense Dr, $1,030
To cash $1,030
(Being cash paid is recorded)
2. Account receivable $120
To service revenue $120
(Being service revenue is recorded)
3. Cash $120
To Service revenue $120
(Being cash received is recorded)
4. Equipment Dr, $515
Cash Dr, $70
To Accounts payable $445
(Being cash received is recorded)
5. Cash Dr $120
To account receivable $120
(Being cash received is recorded)
6. Wage expense $450
To cash $450
(Being cash paid is recorded)
7. Utility expense Dr, $62
To cash $62
(Being cash paid is recorded)
8. Cash Dr, $1,290
To notes payable $1,290
(Being cash received is recorded)
9. Repair & maintenance Dr, $190
To cash $190
(Being cash paid is recorded)
10. Accounts payable Dr, $445
To cash $445
(Being cash paid is recorded)
11. Prepaid Insurance Dr, $1,550
To cash $1,550
(Being cash paid is recorded)
A firm that has recently experienced an enormous growth rate is seeking to lease a small plant in Memphis, TN; Biloxi, MS; or Birmingham, AL. Prepare an economic analysis of the three locations given the following information:
Annual costs for building, equipment, and administration would be $45,200 for Memphis, $60,000 for Biloxi, and $100,000 for Birmingham. Labor and materials are expected to be $8 per unit in Memphis, $4 per unit in Biloxi, and $5 per unit in Birmingham. The Memphis location would increase system transportation costs by $50,000 per year, the Biloxi location by $60,000 per year, and the Birmingham location by $27,800 per year. Expected annual volume is 17,800 units.
Answer and Explanation:
The computation of economic analysis of the three locations is shown below:-
Memphis Total Cost is
= $45,200 + $8(17,800 units) + $50,000
= $237,600
Biloxi Total Cost is
= $60,000 + $4(17,900 units) + $60,000
= $191,600
Birmingham Total Cost is
= $100,000 + $5(17,800 units) + $27,800
= $216,800
In this way it is to be shown
Problem 13-1 A company currently using an inspection process in its material receiving department is trying to install an overall cost reduction program. One possible reduction is the elimination of one inspection position. This position tests items for which the probability of a material defect averages 0.04. By inspecting all items, the inspector is able to remove all defects. The inspector can inspect 50 units per hour. The hourly rate including fringe benefits for this position is $9. If the inspection position is eliminated, defects will go into product assembly and will have to be replaced later at a cost of $10 each when they are detected in final product testing. Assume that the line will operate at the same rate (i.e., the inspection rate) if the inspection operation was eliminated.
Required:
a. If the inspector position is eliminated, what will the hourly cost of defects be?
b. Should this inspection position be eliminated based on costs alone?
c. What is the cost to inspect each unit?
Answer:
a. $20
b. No.
c. $0.18 per unit
Explanation:
a. Hourly cost = Material defects * Cost to replace
50 units are inspected per hour with a 0.04 chance of defects.
= 50 * 0.04 = 2 units
Hourly cost = 2 * 10
= $20
b. No. Based on costs alone, Paying the inspector $9 an hour would be more cost effective than paying $20 to replace the defect.
c. Cost of inspecting each unit = Instructor fee/ Units inspected in an hour
= 9 / 50
= $0.18 per unit
The number of internal disk drives (in millions) made at a plant in Taiwan during the past 5 years follows:______. Year Disk Drives 1 1402 160 3 1904 200 5 210a) Using simple linear regression LOADING..., the forecast for the number of disk drives to be made next year = 243.6 disk drives (round your response to one decimal place). b) The mean squared error (MSE) when using simple linear regression = 4.5 (round your response to one decimal place). c) The mean absolute percentage error (MAPE) when using simple linear regression = 1.04% (round your response to one decimal place).
Full question attached
Answer and Explanation:
Please see answer and explanation attached
Lemony Company made sales of $38,000 million during 2018. Cost of goods sold for the year totaled $16,340 million. At the end of 2017, Lemony’s inventory stood at $1,800 million, and Lemony ended 2018 with inventory of $2,000 million. Compute Lemony’s gross profit percentage and rate of inventory turnover for 2018.Begin by computing Lemony’s gross profit percentage for 2018.
Answer:
Gross profit = 57%
Inventory turnover = 8.60 Times
Explanation:
The gross profit percentage can be calculated by dividing the gross profit by sales. Inventory turnover can be calculated by dividing the cost of goods sold by the average inventory, in this case average inventory is not given in the question. Average inventory can be calculated by dividing the sum of opening and closing inventory with 2.
Gross profit = (Sales - Cost of goods sold) / Sales x 100
Gross profit = (38,000 - 16,340) /38000 x 100%
Gross profit = 21,660/38,000 x 100
Gross profit = 57%
Inventory turnover = Cost of goods sold / Average inventory
Inventory turnover = 16340/1900
Inventory turnover = 8.60 Times
Average inventory = (1800 + 2000) /2
Average inventory = 1900 Million
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. Its unadjusted trial balance as of December 31, 2015, follows. WTI initially records prepaid expenses and unearned revenues in balance sheet accounts. Descriptions of items a through h that require adjusting entries on December 31, 2015, follow.Additional Information Itemsa. An analysis of WTI's insurance policies shows that $3,864 of coverage has expired.b. An inventory count shows that teaching supplies costing $3,349 are available at year-end 2015.c. Annual depreciation on the equipment is $15,458.d. Annual depreciation on the professional library is $7,729.e. On November 1, WTI agreed to do a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,900, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training Fees account was credited. The fee for the sixth month will be recorded when it is collected in 2016.f. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an individual for $4,700 tuition per month payable at the end of the class. The class started on October 15, but no payment has yet been received. (WTI's accruals are applied to the nearest half-month; for example, October recognizes one-half month accrual.)g. 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.h. The balance in the Prepaid Rent account represents rent for December.WELLS TECHNICAL INSTITUTEUnadjusted Trial BalanceDecember 31, 2015Debit Credit Cash $26,189 Accounts receivable 0 Teaching supplies 10,071 Prepaid insurance 15,110 Prepaid rent 2,015 Professional library 30,217 Accumulated depreciation—Professional library $9,066 Equipment 70,500 Accumulated depreciation—Equipment 16,117 Accounts payable 32,840 Salaries payable 0 Unearned training fees 14,500 Common stock 12,812 Retained earnings 51,250 Dividends 40,291 Tuition fees earned 102,740 Training fees earned 38,275 Depreciation expense—Professional library 0 Depreciation expense—Equipment 0 Salaries expense 48,350 Insurance expense 0 Rent expense 22,165 Teaching supplies expense 0 Advertising expense 7,051 Utilities expense 5,641 Totals $277,600 $277,600 1. Prepare the necessary adjusting journal entries for items a through h. Assume that adjusting entries are made only at year-end.2. Prepare an adjusted trial balance
Answer:
1) a. An analysis of WTI's insurance policies shows that $3,864 of coverage has expired.
Dr Insurance expense 3,864
Cr Prepaid insurance 3,864
b. An inventory count shows that teaching supplies costing $3,349 are available at year-end 2015.
Dr Teaching supplies expense 6,722
Cr Teaching supplies 6,722
c. Annual depreciation on the equipment is $15,458.
Dr Depreciation expense 15,458
Cr Accumulated depreciation: equipment 15,458
d. Annual depreciation on the professional library is $7,729.
Dr Depreciation expense 7,729
Cr Accumulated depreciation: professional library 7,729
e. On November 1, WTI agreed to do a special six-month course (starting immediately) for a client. The contract calls for a monthly fee of $2,900, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training Fees account was credited. The fee for the sixth month will be recorded when it is collected in 2016.
Dr Unearned training fees 5,800
Cr Training fees earned 5,800
f. On October 15, WTI agreed to teach a four-month class (beginning immediately) for an individual for $4,700 tuition per month payable at the end of the class. The class started on October 15, but no payment has yet been received. (WTI's accruals are applied to the nearest half-month; for example, October recognizes one-half month accrual.)
Dr Accounts receivable 11,750
Cr Tuition fees earned 11,750
g. 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
h. The balance in the Prepaid Rent account represents rent for December.
Dr Rent expense 2,015
Cr Prepaid rent 2,015
2) Wells Technical Institute (WTI)
Adjusted Trial Balance
For the year ended December 31, 2015
Debit Credit
Cash $26,189
Accounts receivable $11,750
Prepaid rent $0
Teaching supplies $3,349
Prepaid insurance $11,246
Professional library $30,217
Accumulated depreciation: $16,795
Professional library
Equipment $70,500
Accumulated depreciation: $31,575
Equipment
Accounts payable $32,840
Salaries payable $400
Unearned training fees $8,700
Common stock $12,812
Retained earnings $51,250
Dividends $40,291
Tuition fees earned $114,490
Training fees earned $44,075
Depreciation expense: $7,729
Professional library
Depreciation expense: $15,458
Equipment
Salaries expense $48,750
Insurance expense $3,864
Rent expense $24,180
Teaching supplies expense $6,722
Advertising expense $7,051
Utilities expense $5,641
Totals $312,937 $312,937
Homer deposited $3,000 this morning into an account that pays 5 percent interest, compounded annually. Bart also deposited $3,000 this morning at 5 percent interest, compounded annually. At the end of each period, Homer will withdraw his interest earnings and put into a new account that pays 8 percent interest, compounded annually. Given this, which one of the following statements is true?
a. Barb will earn more interest the second year than Andy.
b. Andy will earn more interest in year three than Barb will.
c. Barb will earn more interest the first year than Andy will.
d. Andy will earn compound interest.
e. After five years, Andy and Barb will both have earned the same amount of interest.
Answer:
The answer is "Option a".
Explanation:
In this question, each year Barb pays back the interest received. It will add depth to its principle during the first year. In this, the actual case, the interest for $3000 at 5% for the first year = $150, would be added to $3 000, and $31,50. In the second year, Barb should gain a 5% interest on $3150. Throughout the case of Andy, the second principle will be $3000 like it was at the end of the first year. Thus, Barb's second year is going to have more interest.
In choice b, It is wrong because Andy wants to withdraw its interest, this won't get irritated. He would also receive less interest per year than Barb. In choice c, Its interest would not be the same for both in the first year. In choice d, It is wrong because Andy wants to withdraw interest each year, no compound interest will arise. In choice e, No, not that. Andy won't earn the interest compounded so, the Barb will receive the interest multiplied. Therefore, for the five-year duration, Barb can earn more interest.On april 1, Windsor, Inc. began operations. The following transactions were completed during the month.
1. Issued common stock for $28,300 cash.
2. Obtained a bank loan for $8,300 by issuing a note payable.
3. Paid $13,000 cash to buy equipment.
4. Paid $1,400 cash for April office rent.
5. Paid $1,700 for supplies.
6. Purchased $710 of advertising in the Daily Herald, on account.
7. Performed services for $21,200: cash of $2,360 was received from customers, and the balance of $18,840 was billed to customers on account.
8. Paid $470 cash dividend to stockholders.
9. Paid the utility bill for the month, $2,360.
10. Paid Daily Herald the amount due in transaction (6).
11. Paid $50 of interest on the bank loan obtained in transaction (2).
12. Paid employees’ salaries, $7,550.
13. Received $14,160 cash from customers billed in transaction (7).
14. Paid income tax, $1,770.
Required:
Journalise the transactions.
Answer:
S/n General Journal Debit Credit
1. Cash $28,300
Common stock $28,300
(To record issuance of common stock)
2. Cash $8,300
Note payable $8,300
(To record issuance of note payable)
3. Equipment $13,000
Cash $13,000
(To record purchase of equipment)
4. Rent expense $1,400
Cash $1,400
(To record rent expense)
5. Supplies $1,700
Cash $1,700
(To record purchase supplies )
6. Advertising expense $710
Accounts payable $710
(To record advertising expense)
7. Cash $2,360
Accounts receivable $18,840
Service revenue $21,200
(To record service revenue)
8. Cash dividends $470
Cash $470
(To record cash paid for dividends )
9. Utilities expense $2,360
Cash $2,360
(To record utilities expense)
10. Accounts payable $710
Cash $710
(To record payment to creditors)
11. Interest expense $50
Cash $50
(To record interest expense)
12. Salaries and wages $7,550
expense
Cash $7,550
(To record salaries and wages expense)
13. Cash $14,160
Accounts receivable $14,160
(To record amount received from customers)
14. Tax Expenses $1,770
Account payable $1,770
(To record income tax expenses)
During the spring and summer of 2014, Edward and Geneva Irvine received numerous "hang-up" phone calls, including three calls in the middle of the night. With the help of their local phone company, the Irvine’s learned that many of the calls were from the telemarketing department of the Akron Beacon Journal in Akron, Ohio. The Beacon’s sales force was equipped with an automatic dialing machine. During business hours, the dialer was used to maximize productivity by calling multiple phone numbers at once and connecting a call to a sales representative only after it was answered. After business hours, the Beacon programmed its dialer to dial a list of disconnected numbers to determine whether they had been reconnected. If the dialer detected a ring, it recorded the information and dropped the call. However, if the automated dialing system crashed, which happened frequently, it redialed the entire list all over again. The Irvine’s filed a suit in an Ohio state court against the Beacon, alleging, among other things, an invasion of privacy.
Required:
In whose favor should the court rule, and why?
Answer:
This is an actual court case that went all the way up to the Court of Appeals of Ohio's Ninth District.
It was a very complex case (it also included another case against Beacon for trying to gather information regarding the family, but it was ruled in their favor) were both sides appealed different decisions. The appeals court ruled 1 out of 14 assignments of error in favor of Akron beacon Journal, but it was a minor issue. Most of the original outcome was upheld, with the Irvines being assigned more than $100,000 in different types of damages + their attorney's fees.
Akron beacon Journal was found guilty of violating the Telephone Consumer Protection Act and invading the Irvines' privacy.
Using this type of machines are illegal and what makes things worse is that the marketing department of Beacon knew it wasn't working properly and they kept resetting it. It made a lot of calls to the Irvines at hours that no one would expect them, all after or before working hours. Their actions were deliberate since they were in desperate need of new subscribers to their newspaper.
Balance Sheet Missing element problem.Plz help?
I tried but didn't make it correct.Can anyone plz help?
The following December 31, 2009, fiscal year-end account balance information is available for the Stonebridge Corporation:
Cash and cash equivalents $ 5,000
Accounts receivable (net) 20,000
Inventories 60,000
Property, plant, and equipment (net) 120,000
Accounts payable 44,000
Wages payable 15,000
Paid-in-capital 100,000
The only asset not listed is short-term investments. The only liabilities not listed are a $30,000 note payable due in two years and related accrued interest of $1,000 due in four months. The current ratio at year-end is 1.5:1.
Required:
Determine the following at December 31, 2009:
Total current assets ??
Short-term investments ??
Retained earnings ??
Answer:
1. Current ratio = Total current assets / Current liabilities
Total current assets = Current liabilities * Current ratio
Total current assets = ($44,000 + $15,000 + $1,000) + 1.5
Total current assets = $60,000 * 1.5
Total current assets = $90,000
2. Short Investments = Total current assets - (Cash + Accounts receivable + Inventories)
Short Investments = $90,000 - ($5,000 + $20,000 + $50,000)
Short Investments = $90,000 - $75,000
Short Investments = $15,000
3.Calculation of Retained earnings
Total assets = Long term assets + Current assets = $120,000 + $90,000 + $210,000
Retained earnings = Total assets - (Current liabilities + Long term liabilities + Paid in capital
Retained earnings = $210,000 - ($60,000 + $30,000 + $100,000)
Retained earnings = $210,000 - $190,000
Retained earnings = $20,000