Answer:
The credits to Raw material account for the month of November total is $90,000
Explanation:
Missing word "The credits to the Raw Materials account for the month of November total:"
Journal entry
Date Accounts title and Explanation Debit Credit
Work in process inventory $86,500
(90,000 - 3,500)
Manufacturing overheads $3,500
Raw material inventory $90,000
The following information describes the investment portfolio of Stevens, Incorporated. All of the securities were purchased on 3/1/19, and are held with the intention of appreciation. Tlet, Loxat, and Barnes each have more than 1,000,000 common shares issued and outstanding throughout 2019 and 2020. No dividends have been received by Stevens, Inc. on these investments. On 5/1/2020, when Loxat was trading at $81 per share, Stevens Inc. sold 1000 shares.
Security Cost at 12/31/19 / share FMV at 12/31/2019 /share FMV at 12/31/2020/share
Tlet Inc (1000 sh) $23,000 28,500 37,000
Loxat Co (2000 sh) 100,000 142,500 96,500
Barnes Inc (2000 sh) 46,000 39,000 42,000
Total $169,000 210,000 175,500
Required:
a. Prepare the Necessary Journal Entries for 2019 and 2020
b. Complete a fair value adjustment
Answer:
a. 3/1/2019
Dr Investment in Tlet Inc $23,000
Dr Investment in Loxat Co $100,000
Dr Investment in Barnes Inc $46,000
Cr Cash $169,000
12/31/2019
Dr Fair value adjustment $41,000
Cr Unrealised holding gain or loss,Net $41,000
5/1/2020
Dr Cash $81,000
Cr Investment in Loxat Co $50,000
Cr Recognized gain on sale $31,000
12)31/2020
Dr Fair value adjustment $15,500
Cr Unrealised holding gain or loss,Net $15,500
b. Fair value adjustment $41,000
Fair value adjustment $15,500
Explanation:
a. Preparation of the Necessary Journal Entries for 2019 and 2020
3/1/2019
Dr Investment in Tlet Inc $23,000
Dr Investment in Loxat Co $100,000
Dr Investment in Barnes Inc $46,000
Cr Cash $169,000
12/31/2019
Dr Fair value adjustment $41,000
Cr Unrealised holding gain or loss,Net $41,000
($169,000-$210,000)
5/1/2020
Dr Cash $81,000
( $81 per share*1,000 shares)
Cr Investment in Loxat Co $50,000
[($100,000/2,000 shares=50 shares)
[($50*1,000 =$50,000)
Cr Recognized gain on sale $31,000
($81,000-$50,000)
12)31/2020
Dr Fair value adjustment $15,500
Cr Unrealised holding gain or loss,Net $15,500
[($119,000-$175,500)-$41,000]
($23,000+$50,000+$46,000=$119,000)
b.Calculation to Complete the fair value adjustment
A. Fair value adjustment =$169,000-$210,000
Fair value adjustment $41,000
B. Fair value adjustment=[($119,000-$175,500)-$41,000]
Fair value adjustment=$56,500-$41,000
Fair value adjustment= $15,500
Therefore the Fair value adjustment will be:
A. $41,000
B. $15,500
Technoid Inc. sells computer systems. Technoid leases computers to Lone Star Company on January 1, 2021. The manufacturing cost of the computers was $12 million. This noncancelable lease had the following terms: Lease payments: $2,466,754 semiannually; first payment at January 1, 2021; remaining payments at June 30 and December 31 each year through June 30, 2025. Lease term: five years (10 semiannual payments). No residual value; no purchase option. Economic life of equipment: five years. Implicit interest rate and lessee's incremental borrowing rate: 5% semiannually. Fair value of the computers at January 1, 2021: $20 million. Technoid would account for this as:
Answer:
A sales type lease with selling profit.
Explanation:
Technoid Inc. would account for this as a sales type lease with selling profit. In a sales type lease, the fair value of the leased asset at the start of a lease varies from its carrying amount and there is a transfer of ownership by law to the lessee at the end of the lease period. Cost is $12 million and Fair value is $20 million and Present value of minimum lease payment is also $20 million.
For Lone Star Company, it would account for this as a finance lease.
On January 1 , 1980 , Jack deposited $ 1 , 000 into bank X to earn interest at a nominal annual rate of j compounded semiannually. On January 1 , 1985 , he transferred his account to bank Y to earn interest at a nominal annual rate of k compounded quarterly. On January 1 , 1988 , the balance at bank Y is $ 1 , 990.76 . If Jack could have earned interest at nominal annual rate of k compounded quarterly from January 1 , 1980 through January 1 , 1988 , his balance would have been $ 2 , 203.76 . Calculate the ratio of k to j .
Answer:
1.25
Explanation:
1000*(1+x)^8 = 2203.76
(1+x)^8 = 2203.76/1000
(1+x)^8 = 2.20376
Taking root of both side
(1+x)^8^(1/8) = 2.20376^(1/8)
1 + x = 1.10381308235
x = 1.10381308235 - 1
x = 0.10381308235
x = 10.38%..............(Equ 1)
1000*((1+y)^5)*((1+x)^3) = 1990.76
1000*((1+y)^5)*1.344889 = 1990.76
((1+y)^5) = 1.48024
Taking root of both side
((1+y)^5)^(1/5) = 1.48024^(1/5)
1+y = 1.08159937381
y = 1.08159937381 - 1
y = 0.08159937381
y = 18.15995%...........(Equ ii)
J = (((1+y)^1/2)-1)*2
J = (((1+0.08159937381)^1/2) - 1)*2
J = (1.039999698947072 - 1)*2
J = .039999698947072 * 2
J = 0.079999397894144
J = 7.9999%
J = 8%
K = (((1+x)^1/4)-1)*4
K = (((1+0.10381308235 )^1/4)-1)*4
K = 10%
So K/J = 10/8 = 1.25
Mustang Corporation had 100,000 shares of $2 par value common stock outstanding. On December 31, 2018, the company's board of directors declares a 20 percent stock dividend. This stock dividend will be distributed on January 20, 2019 to the stockholders of record on January 15, 2019. The market price of the company's stock is $10 per share on December 31, 2018.
Required:
Write down the necessary journal entry to record the declaration of the stock dividend.
Answer:
December 31, 2018
Debit : Dividend $40,000
Credit : Shareholders for dividends $40,000
Explanation:
When dividends are declared, we Debit an Equity Element - Dividend and Credit the Liability - Shareholders for dividends.
Calculation of this dividend is made on the stockholders in existence at the on a stated date (January 15 in this case) and at par value ($2) as follows :
Dividend = 100,000 x $2.00 x $0.20 = $40,000
What skills and interests might someone in a trade career have?
Answer:
Confidence.
Numerical skills.
IT skills.
Communication skills.
An interest in financial markets.
Analytical skills.
Interpersonal skills.
Teamworking skills.
After graduating from college, you are hired by the Ford automobile company as an economic analyst. For your first project, you are asked to estimate what would happen to the sales of Ford Mustangs as a result of a change in (i) the price of a Chevrolet Camaro, (ii) the price of gasoline, and (iii) consumer incomes. You are given the following elasticities:
price elasticity Of demand for Ford Mustangs= -2.5
Cross-price elasticity between Ford Mustangs and Camaros =1.5
Cross-price elasticity between Ford Mustangs and gasoline= -0.80
Income elasticity of demand for Ford Mustangs= 3.00
a. Suppose the price Of a Camaro falls by 10%. With all else being equal, sales of Ford Mustangs would______ by_______%
b. If the price of gasoline increases by 20%, the quantity of Ford Mustangs would _________by_______%
Answer:
a. Decrease by 15%
b. decrease by 16%
Explanation:
a. As we know that
Camaro and ford mustangs would be considered as a substitute goods as the cross price elasticity of demand comes in positive so in the case when the price of camaro decrease so the quantity of Mustang would also decreased by 1.5 ×10% = 15%
b. As we know that Gasoline and mustang would be considered as complementary goods so if the price of gasoline would increase by 20% so the quantity of mustang be decreased by 0.80 × 20% = 16%
On June 1, 2019, Splish Company sold $3,720,000 in long-term bonds for $3,262,800. The bonds will mature in 10 years and have a stated interest rate of 8% and a yield rate of 10%. The bonds pay interest annually on May 31 of each year. The bonds are to be accounted for under the effective-interest method.
Required:
Construct a bond amortization table for this problem to indicate the amount of interest expense and discount amortization at each May 31.
Answer:
For second period
Cash interest = $3,720,000 * 8% = $297,600
Interest expenses = 3,262,800 * 10% = $326,280
Discount = $326,280 - $297,600 = $28,680
For third period
Cash interest = $3,720,000 * 8% = $297,600
Interest expenses = $3,291,480 * 10% = $329,148
Discount = $329,148 - $297,600 = $31,548
Effective interest amortization table
Annual period Cash int. Interest exp Discount Carrying amount
6/1/19 $3,262,800
5/31/20 $297,600 $326,280 $28,680 $3,291,480
5/31/21 $297,600 $329,148 $31,548 $3,323,028
5/31/22 $297,600 $332,303 $34,703 $3,357,731
5/31/23 $297,600 $335,773 $38,173 $3,395,904
A team of analysts at Amazon is researching the viability of producing a smart watch. How might they estimate potential demand for their smart watch? a. Consider the four-step process that many companies follow to estimate the market demand curve for their product. Place the steps in order, with the first step in the highest position and the last step in the lowest position.
Answer:
Survey customersAdd up the total quantity demanded by the customers at each price pointScale up the quantities demanded by the survey respondentsPlot the demand curveExplanation:
First the companies will survey customers to gauge their interest and demand for the product in question as well as the price they might consider buying it at. They will then take this data and add up the different responses from various people at each price point.
This will then scale up the quantities demanded so as to include the entire market by using the survey as a sample. After this they will plot a demand curve.
Find the accumulated value of $ 740 at the end of 7 years using a nominal annual rate of interest of 6 % compounded quarterly.
Answer:
$1122.74
Explanation:
We are to find the future value of $740
The formula for calculating future value:
FV = P (1 + r/m)^nm
FV = Future value
P = Present value
R = interest rate = 6
N = number of years = 7
m = number of compounding = 4
$740 x (1 + 0.06/4)^7x4 = $1122.74
Select the correct answer.
Prontas Inc. has bought back 2,000 of its stock from its shareholders at par value of $5. How will this transaction be recorded in the journal of Prontas Inc.?
A.
Treasury Stock Account (Debit) $10,000 Common Stock Account (Credit) $10,000
B.
Cash Account (Debit) $10,000 Common Stock Account (Credit) $10,000
C.
Cash Account (Debit) $10,000 Treasury Stock Account (Credit) $10,000
D.
Treasury Stock Account (Debit) $10,000 Cash Account (Credit) $10,000
If Prontas Inc. has bought back 2,000 of its stock from its shareholders at par value of $5. This transaction will be recorded in the journal of Prontas Inc. as: D. Treasury Stock Account (Debit) $10,000 Cash Account (Credit) $10,000.
What is journal entry?Journal entry is used by companies to post their business transaction. The appropriate journal entry to record this transaction is Treasury Stock Account (Debit) $10,000 Cash Account (Credit) $10,000 which is calculated as :
Prontas Inc. entry
Debit: Treasury Stock $10,000
(2,000 x $5)
Credit: Cash $10,000
(2,000 x $5)
Therefore the correct option is D.
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A 5-year corporate bond yields 8.00%. A 5-year municipal bond of equal risk yields 6.50%. Assume that the state tax rate is zero. At what federal tax rate are you indifferent between the two bonds? (Round your final answer to two decimal places.)
Answer:
18.75%
Explanation:
Yield on corporate bonds = 8%
Yield on municipal bonds = 6.5%
Let Tax rate = t
To be indifferent between the two bonds:
6.5% = 8% / (1-t)
(1-t) = 6.5%/8%
-t = 0.8125 - 1
-t = -0.1875
t = 0.1875
t = 18.75%
Account of a supplier would be found
The purchase ledger contains the individual accounts of suppliers from whom the business has made purchases on credit.
Mark as brainlist
The individual accounts of suppliers that the company has made credit-based purchases from are listed in the purchase ledger.
What is the Account of a supplier?The term "supplier accounts" refers to all accounts generated by a borrower or domestic subsidiary for a specific account debtor or its affiliates in the event that a borrower or domestic subsidiary has established a supplier agreement with respect to any of an account debtor's accounts.
Every supplier and client that the business deals with will be handled as a distinct account. Items can be linked to an account that are both material and immaterial.
All transactions relating to each and every Supplier, including all invoices issued and paid for beginning on the first day, are kept in the Supplier ledgers.
Thus, The individual accounts of suppliers that the company has made credit-based purchases.
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Waupaca Company establishes a $350 petty cash fund on September 9. On September 30, the fund shows $144 in cash along with receipts for the following expenditures: transportation costs of merchandise purchased, $42; postage expenses, $50; and miscellaneous expenses, $102. The petty cashier could not account for a $12 shortage in the fund. The company uses the perpetual system in accounting for merchandise inventory. Prepare:
a. the September 9 entry to establish the fund.
b. the September 30 entry to reimburse the fund
c. An October 1 entry to increase the fund to $395.
Solution :
Date Account Debit Credit
Sept 9 Petty cash $ 350
Cash $ 350
Sept 30 merchandise purchased $ 42
postage expenses $ 50
miscellaneous expenses $ 102
Cash shortage $ 12
Cash (350-42-50-102)=156-144=12 $ 206
Oct 1 Petty cash 45
Cash (395-350) $ 45
Bill and Ted are deciding what musical instruments they want to learn to play for their band. They can pick between the guitar, keyboard, and the drums.They both want to have a good band, but also each has a preference over what toplay. Both like the drums over all else. However, Bill likes the keyboard more thanthe guitar and Ted likes the guitar more than the keyboard. What is crucial is that each chooses a different instrument, otherwise the band is pretty terrible. The actual combination does not affect the quality of the band. One night, Bill and Ted simultaneously reveal to each other what instrument they have bought decided to learn. Since they bought the instrument they are committedto learning it! Given the information above,
1. Does either Bill or Ted have a dominant/dominated strategy? Explain.
2. If Bill picks the keyboard, is it a best response for Ted to pick the drums? Explain.
3. If Ted picks the guitar, is it a best response for Bill to pick the keyboard? Explain.
4. Can there exista Nash equilibrium in which Bill picks the drums and Ted picks the keyboard? Explain.
5. Can there exist a Nash Equlibrium in which Bill picks the guitar and Ted picks the drums? Explain.
Answer:
1. Does either Bill or Ted have a dominant/dominated strategy? Explain.
No, since both like playing the drums. But if both choose the drums, then there is no band.
2. If Bill picks the keyboard, is it a best response for Ted to pick the drums? Explain.
yes, since Ted likes the drums more than the guitar.
3. If Ted picks the guitar, is it a best response for Bill to pick the keyboard? Explain.
No, Bill should pick the drums since he likes them more.
4. Can there exist a Nash equilibrium in which Bill picks the drums and Ted picks the keyboard? Explain.
No, because they both prefer the drums, but Ted doesn't like the keyboard.
5. Can there exist a Nash Equilibrium in which Bill picks the guitar and Ted picks the drums? Explain.
No, because they both prefer the drums, but Bill doesn't like the guitar.
May 24 Sold merchandise on account to Old Town Cafe $18,450. The cost of goods sold was $11,000.
Sept. 30 Received $6,000 from Old Town Cafe and wrote off the remainder owed on the sale of May 24 as uncollectible.
Dec. 7 Reinstated the account of Old Town Cafe that had been written off on September 30 and received $12,450 cash in full payment.
Journalize the above transactions in the accounts of Zippy Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables. Refer to the Chart of Accounts for exact wording of account titles.
CHART OF ACCOUNTS
Zippy Interiors Company
General Ledger
ASSETS
110 Cash
111 Petty Cash
121 Accounts Receivable-Old Town Cafe
129 Allowance for Doubtful Accounts
131 Interest Receivable
132 Notes Receivable
141 Inventory
145 Office Supplies
146 Store Supplies
151 Prepaid Insurance
181 Land
191 Store Equipment
192 Accumulated Depreciation-Store Equipment
193 Office Equipment
194 Accumulated Depreciation-Office Equipment
LIABILITIES
210 Accounts Payable
211 Salaries Payable
213 Sales Tax Payable
214 Interest Payable
215 Notes Payable
EQUITY
310 Common Stock
311 Retained Earnings
312 Dividends
313 Income Summary
REVENUE
410 Sales
610 Interest Revenue
EXPENSES
510 Cost of Goods Sold
520 Sales Salaries Expense
521 Advertising Expense
522 Depreciation Expense-Store Equipment
523 Delivery Expense
524 Repairs Expense
529 Selling Expenses
530 Office Salaries Expense
531 Rent Expense
532 Depreciation Expense-Office Equipment
533 Insurance Expense
534 Office Supplies Expense
535 Store Supplies Expense
536 Credit Card Expense
537 Cash Short and Over
538 Bad Debt Expense
539 Miscellaneous Expense
710 Interest Expense
Journalize the transactions in the accounts of Zippy Interiors Company, a restaurant supply company that uses the allowance method of accounting for uncollectible receivables. Refer to the Chart of Accounts for exact wording of account titles.
How does grading work?
PAGE 1
JOURNAL
ACCOUNTING EQUATION
DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY
1 ✔ ✔
2 ✔
3 ✔
4
5 ✔
6
7 ✔
8 ✔ ✔
9 ✔
10✔
11✔
Answer:
Date General Ledger Debit Credit
May 24 Accounts Receivable-Old Town Café $18,450
Sales $18,450
Cost of goods sold $11,000
Inventory $11,000
Sept. 30 Cash $6,000
Allowance for Doubtful Accounts $12,450
Accounts Receivable-Old Town Cafe $18,450
Dec. 7 Accounts Receivable-Old Town Cafe $12,450
Allowance for Doubtful Accounts $12,450
Cash $12,450
Accounts Receivable-Old Town Cafe $12,450
Corporation purchased inventory costing and sold % of the goods for . All purchases and sales were on account. later collected % of the accounts receivable.
1. Journalize these transactions for Bridget, which uses the perpetual inventory system.
2. For these transactions, show what Bridget will report for inventory, revenues, and expenses on its financial statements at the end of the month. Report gross profit on the appropriate statement.
1. Journalize these transactions for , which uses the perpetual inventory system.
Journalize the purchase of inventory. (Record debits first, then credits. Exclude explanations from any journal entries.)
Journal
Accounts Debit Credit
Accounts Receivable 180,000
Cost of Goods Sold 235,000
Answer:
1.
A. Dr Inventory 180,000
Cr Accounts Payable 180,000
B. Dr Accounts Receivable 235,000
Cr Sales Revenue 235,000
C. Dr Cost of Goods Sold 135,000
Cr Inventory 135,000
D. Dr Cash 70,500
Cr Accounts Receivable 70,500
2. BALANCE SHEET $45,000
INCOME STATEMENT $100,000
Explanation:
1. Preparation of the journal entry
A. Preparation of the journal entry for the purchase of inventory.
Dr Inventory 180,000
Cr Accounts Payable 180,000
(Being to record the purchase of inventory)
B. Preparation of the journal entry for sale
Dr Accounts Receivable 235,000
Cr Sales Revenue 235,000
(Being to record sale revenue)
C. Preparation of the journal entry to
Record the cost of goods sold portion of the sale.
Dr Cost of Goods Sold 135,000
Cr Inventory 135,000
(75%*180,000)
(Being to record cost of goods sold portion of the sale)
D. Preparation of the journal entry to Record the collection of 30% of the accounts receivable.
Dr Cash 70,500
Cr Accounts Receivable 70,500
(30%*235,000)
(Being to record the collection of 30% of the accounts receivable)
2. Calculation to Determine what the company will report on the balance sheet
BALANCE SHEET
Current Assets:
Inventory $45,000
(180,000-135,000)
Therefore the company will report $45,000 on the balance sheet
Calculation to Determine what the company will report on the income statement:
INCOME STATEMENT
Sales revenue 235,000
Less Cost of Goods Sold 135,000
Gross profit $100,000
Therefore the company will report $100,000 on the income statement
O
A. Both have interest rates higher than fixed rate.
B. Both have variable rates.
C. Both have fixed initial rate and payment amount.
O
D. The both automatically adjust after the initial period.
The balloon mortgage and ARM have in common is Both have fixed initial rates and payment amounts. Thus the correct option is C.
What is a balloon mortgage?With a balloon mortgage, scheduled payments are made for a certain amount of time until a last, one-time, substantial payment must be made. Here, the final payment is at minimum twice as large as the mortgage's typical monthly payment.
In adjustable-rate mortgages (ARMs), the interest rate is subject to regular modifications based on changes in the relevant financial index connected to the loan and works accordingly.
Including an initial rate period that is equal to the inflated term, a balloon mortgage is comparable to an adjustable-rate mortgage (ARM) in other aspects.
Therefore, option C is appropriate.
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The complete question is probably
What do balloon mortgage and ARM have in common?
OA. Both have variable rates.
B. The both automatically adjust after the initial period.
C. Both have fixed initial rate and payment amount.
D. Both have interest rates higher than fixed rate.
A $200,000 loan amortized over 13 years at an interest rate of 10% per year requires payments of $21,215.85 to completely remove the loan when interest is charged on the unrecovered balance of the principal. If interest is charged on the original principal instead of the unrecovered balance, what is the loan balance after 13 years provided the same $21,215.85 payments are made each year
Answer:
Loan amount = $184,193.95
Explanation:
Interest will remain same each year. Interest per year = 200,000*10% = $20,000
Installment $21,215.85
Less: Interest $20,000
Payment to Principal $1,215.85
Total principal repaid in 13 years = $1,215.85 * 13 years = $15,806.05
So, the principal left = $200,000 - $15,806.05 = $184,193.95
Mumford Corporation invested $30,000 in marketable securities on December 4. On December 9, it sold some of these investments for $10,000, and on December 18, it sold more of these investments for $5,000. The securities sold on December 9 had cost the company $7,000, whereas the securities sold on December 18 had cost the company $6,000.
a) Record the purchase of marketable securities on December 4.
b) Record the sale of marketable securities on December 9.
c) Record the sale of marketable securities on December 18.
d) Record the necessary fair value adjustment on December 31, assuming that the market value of the company's remaining unsold securities was $20,000.
Answer:
Mumford Corporation
Journal Entries:
a) December 4:
Debit Investment in Marketable Securities $30,000
Credit Cash $30,000
To record the purchase of marketable securities.
b) December 9:
Debit Cash $10,000
Credit Investment in Marketable Securities $7,000
Credit Gain from sale of marketable securities $3,000
To record the sale of investment and the gain arising from the sale.
c) December 18:
Debit Cash $5,000
Debit Loss from sale of securities $1,000
Credit Investment in marketable securities $6,000
To record the sale of marketable securities and the arising loss.
d) December 31:
Debit Investment in Marketable Securities $3,000
Credit Unrealized Gain $3,000
To record the unrealized gain on marketable securities.
Explanation:
a) Investment in marketable securities = $30,000 on December 4
Cost of units sold on December 9 = $7,000; selling price =$10,000
Cost of units sold on December 18 = $6,000; selling price = $5,000
b) Mumford will record an unrealized gain to the value of $3,000 because the value of the marketable securities has increased but the asset is yet to be sold for cash. When the asset is eventually sold, it becomes a realized gain.
By debiting the trade receivables account and crediting the sales account, the journal entry to document such credit value of products and services is passed.
Journal entry based problem:S.no Particular Debit Credit
A. Marketable securities DR 30,000
Cash CR 30,000
B. Cash DR 10,000
Marketable securities CR 7,000
Gain on sale CR 3,000
C. Cash DR 5,000
Loss on sale of Investments DR 1,000
Marketable Securities CR 6,000
D. Marketable Securities DR 3,000
Unrealized holding gain CR 3,000
($30,000 − $7,000 − $6,000 - 20,000)
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The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system.
April 30 May 31
Inventories Raw materials $ 43,000 $ 52,000
Work in process 10,200 21,300
Finished goods 63,000 35,600
Activities and information for May Raw materials purchases (paid with cash) 210,000
Factory payroll (paid with cash) 345,000
Factory overhead Indirect materials 15,000
Indirect labor 80,000
Other overhead costs 120,000
Sales (received in cash) 1,400,000
Predetermined overhead rate based on direct labor cost 70 %
1. Raw materials purchases for cash.
2. Direct materials usage.
3. Indirect materials usage.
Prepare journal entries for the above transactions for the month of May.
Answer:
A. Dr Raw meat Inventory 120,000
Cr Cash 120,000
B. Dr Indirect Materials $186,000
Cr Raw Materials $186,000
C. Dr Direct Materials $15,000
Cr Raw Materials $15,000
Explanation:
Preparation for the journal entries for the above transactions for the month of May.
Dr Raw meat Inventory 120,000
Cr Cash 120,000
(Being to record Raw materials purchases for cash)
B. Dr Indirect Materials $186,000
Cr Raw Materials $186,000
($201,000 - 15,000)
C. Dr Direct Materials $15,000
Cr Raw Materials $15,000
Brothers Mike and Tim Hargen began operations of their tool and die shop (H & H Tool, Inc.) on January 1, 2016. The annual reporting period ends December 31. The trial balance on January 1, 2017, follows:
Account Titles Debit Credit
Cash 10,000
Accounts receivable 9,000
Supplies 18,000
Land
Equipment 85,000
Accumulated depreciation (on equipment) 15,000
Other assets (not detailed to simplify)7,000
Accounts payable
Wages payable
Interest payable
Income taxes payable
Long-term notes payable
Common stock (8,000 shares, $.50 par value) 4,000
Additional paid-in capital 87,000
Retained earnings 23,000
Service revenue
Depreciation expense
Supplies expense
Wages expense
Interest expense
Income tax expense
Remaining expenses (not detailed to simplify)
Totals 129,000 129,000
Transactions during 2017 follow:
a. Borrowed $15,000 cash on a 5-year, 8 percent note payable, dated March 1, 2017.
b. Purchased land for a future building site on March 15, 2017; paid cash, $18,000.
c. Earned $271,000 in revenue. Transactions dated August 30, 2017 , including $56,000 on credit and the rest in cash.
d. Sold 4,000 additional shares of capital stock for cash at $1 market value per share on January 1, 2017.
e. Incurred $128,000 in remaining expenses for 2017, invoices dated October 15, 2017, including $27,000 on credit and the rest paid in cash.
f. Collected accounts receivables on November 10, 2017, $41,000.
g. Purchased other assets on November 15, 2017, $18,000 cash.
h. Purchased supplies on account for future use on December 1, 2017, $30,000.
i. Paid accounts payable on December 15, 2017, $28,000.
j. Signed a three-year $36,000 service contract on December 17, 2017 to start February 1, 2018.
k. Declared and paid cash dividends on December 20, 2017, $28,000.
l. Data for adjusting entries:
m. Supplies counted on December 31, 2017, $21,000.
n. Depreciation for the year on the equipment, $17,000.
o. Interest accrued on notes payable (to be computed).
p. Wages earned by employees since the December 24 payroll but not yet paid, $20,000.
q. Income tax expense, $16,000, payable in 2018.
Required:
1. Prepare journal entries for the transactions.
2. Prepare an income statement.
3. Compute the following ratios:
Current ratio
Total asset turnover
Net profit margin
Answer:
H & H Tool, Inc.
1. Journal Entries:
a. Debit Cash $15,000
Credit Note Payable $15,000
To record the receipt of a 5-year, 8% note payable.
b. Debit Land $18,000
Credit Cash $18,000
To record the purchase of land.
c. Debit Cash $215,000
Debit Accounts Receivable $56,000
Credit Service Revenue $271,000
To record services revenue earned.
d. Debit Cash $4,000
Credit Common Stock $2,000
Credit Additional Capital $2,000
To record the issue of additional shares at $1 each.
e. Debit Remaining expenses $128,000
Credit Cash $101,000
Credit Accounts Payable $27,000
To record the expenses incurred.
f. Debit Cash $41,000
Credit Accounts Receivable $41,000
To record cash collection from customers.
g. Debit Other Assets $18,000
Credit Cash $18,000
To record the purchase of other assets.
h. Debit Supplies $30,000
Credit Accounts Payable $30,000
To record the purchase of supplies on account.
i. Debit Accounts Payable $28,000
Credit Cash $28,000
To record the payment on account.
j. No Journal Required
k. Debit Dividends $28,000
Credit Cash $28,000
To record the payment of dividends.
Adjusting entries:
m. Debit Supplies Expense $27,000
Credit Supplies $27,000
To record supplies used.
n. Debit Depreciation Expense - Equipment $17,000
Credit Accumulated Depreciation - Equipment $17,000
To record depreciation expense.
o. Debit Interest Expense $1,000
Credit Interest Payable $1,000
To record the accrued interest expense for the year.
p. Debit Wages Expense $20,000
Credit Wages Payable $20,000
To record accrued wages.
q. Debit Income Tax Expense $16,000
Credit Income Tax Payable $16,000
To record accrued income tax expense.
2. Income Statement as of December 31, 2017
Service revenue $271,000
Depreciation expense 17,000
Supplies expense 27,000
Wages expense 20,000
Interest expense 1,000
Income tax expense 16,000
Remaining expenses
(not detailed to simplify) 128,000
Total expenses $237,000
Net income $34,000
Retained earnings, January 1, 2017 $23,000
Net income 34,000
Dividends 28,000
Retained earnings, December 31, 2017 $29,000
3. Current Ratio = Current Assets/Current Liabilities
= $137,000/$66,000
= 2.08
Total asset turnover = Total Revenue/Total Assets
= $271,000/$208,000
= 1.3
Net Profit Margin = $34,000/$271,000 * 100
= 12.5%
Explanation:
a) Data and Calculations:
Trial balance on January 1, 2017, follows:
Account Titles Debit Credit
Cash $10,000
Accounts receivable 9,000
Supplies 18,000
Land
Equipment 85,000
Accumulated depreciation (on equipment) $15,000
Other assets (not detailed to simplify)7,000
Accounts payable
Wages payable
Interest payable
Income taxes payable
Long-term notes payable
Common stock (8,000 shares, $.50 par value) 4,000
Additional paid-in capital 87,000
Retained earnings 23,000
Service revenue
Depreciation expense
Supplies expense
Wages expense
Interest expense
Income tax expense
Remaining expenses (not detailed to simplify)
Totals 129,000 129,000
December 31:
Cash balance = $92,000 ($10,000+15,000-18,000+215,000+4,000-101,000+41,000-18,000 -28,000-28,000)
Accounts Receivable = $24,000 (9,000+56,000 -41,000)
Supplies = $21,000 ($18,000 + 30,000 - 27,000)
Land = $18,000
Accumulated Depreciation = $32,000 ($17,000 + 15,000)
Other assets = $25,000 (7,000 +18,000)
Accounts Payable = $29,000 ($27,000 + 30,000 - 28,000)
Wages Payable = $20,000
Interest Payable = $1,000
Income Tax Payable $16,000
Long-term Notes Payable = $15,000
Common stock = $6,000 ($4,000 + 2,000)
Additional capital = $89,000 ($87,000 + 2,000)
Service Revenue = $271,000
Depreciation expense = $17,000
Supplies expense = $27,000
Wages expense= $20,000
Interest expense = $1,000
Income tax expense $16,000
Remaining expenses $128,000
Dividends = $28,000
Adjusted Trial balance on December 31, 2017, follows:
Account Titles Debit Credit
Cash $92,000
Accounts receivable 24,000
Supplies 21,000
Land 18,000
Equipment 85,000
Accumulated depreciation (on equipment) $32,000
Other assets (not detailed to simplify)25,000
Accounts payable 29,000
Wages payable 20,000
Interest payable 1,000
Income taxes payable 16,000
Long-term notes payable 15,000
Common stock (8,000 shares, $.50 par value) 6,000
Additional paid-in capital 89,000
Retained earnings 23,000
Service revenue 271,000
Depreciation expense 17,000
Supplies expense 27,000
Wages expense 20,000
Interest expense 1,000
Income tax expense 16,000
Remaining expenses
(not detailed to simplify) 128,000
Dividends 28,000
Totals 502,000 502,000
Current Assets:
Cash $92,000
Accounts receivable 24,000
Supplies 21,000
Total Current Assets $137,000
Land 18,000
Equipment 85,000
Accumulated Depr. (32,000)
Total long-term assets = $71,000
Total assets = $208,000
Current Liabilities:
Accounts payable $29,000
Wages payable 20,000
Interest payable 1,000
Income taxes payable 16,000
Total current liabilities $66,000
Rugen Inc., a hospitality chain, hired a large number of military veterans in the hope that it would help put the business in a different league altogether compared to its competitors. However, the company soon experienced a backlash and drew flak in the hospitality industry, as it could not efficiently manage and retain these employees. Most of the veterans who joined the organization complained that management did not treat them the way they had expected to be treated. Which of the following things could Rugen Inc. have done differently to avoid these repercussions?
a. It should have followed the standard recruiting procedures to hire these employees to avoid bias.
b. It should have tried to mimic reward and recognition programs that are conducted in the military to acknowledge the employees' contributions.
c. It should have let these members take control over most of its departments, especially security.
d. It should not have mixed these employees with regular employees, as veterans come from a completely different background.
Answer:
b. It should have tried to mimic reward and recognition programs that are conducted in the military to acknowledge the employees' contributions.
Explanation:
In the case described above, Rugen Inc. could have tried to mimic reward and recognition programs that are conducted in the military to acknowledge the employees' contributions.
Delicious Catering completed the following selected transactions during May 2016: May 1: Prepaid rent for three months, $1,500 May 5: Received and paid electricity bill, $190 May 9: Received cash for meals served to customers, $2,400 May 14: Paid cash for kitchen equipment, $2,500 May 23: Served a banquet on account, $2,000 May 31: Made the adjusting entry for rent (from May 1). May 31: Accrued salary expense, $1,700 May 31: Recorded depreciation for May on kitchen equipment, $340
Question Completion:
If Delicious Catering had recorded transactions using the Accrual method, how much net income (loss) would they have recorded for the month of May? If there is a loss, enter it with parentheses or a negative sign.
Answer:
Delicious Catering
Using the Accrual method, Delicious Catering would have recorded for the month a net income of $1,670.
Explanation:
Data and Calculations:
Prepaid Rent for 3 months = $1,500
Rent expense for the month = $500 ($1,500/3)
Utilities expense = $190
Service Revenue:
Cash for meals = $2,400
Credit 2,000
Total $4,400
Salary Expense = !,700
Depreciation expense = $340
Kitchen Equipment = $2,500
Income Statement for the month of May:
Service Revenue $4,400
Expenses:
Rent $500
Utilities expense 190
Salary expense 1,700
Depreciation expense 340
Total expenses $2,730
Net Income $1,670
A heavy snowstorm is predicted to occur in Boston on the same night as the city’s professional basketball team is playing a game. The snowstorm, if it occurs, will make it difficult for people to drive into the city. In anticipation of lower demand, the arena lowers the prices of tickets to the game. When compared to quantity demanded in the absence of the storm and the price change, the new quantity demanded:__________
1) will definitely be lower than before.
2) will definitely be higher than before.
3) will be the same as before.
4) cannot be determined.
Answer:
2
Explanation:
According to the law of demand, the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded.
If the price of the ticket is reduced, the quantity demanded would increase
If on the other hand, prices are increased, the quantity demanded would reduce.
In the discussion forum, you are expected to participate often and engage in deep levels of discourse. Please post your initial response by Sunday evening and continue to participate throughout the unit. You are required to post an initial response to the question/issue presented in the Forum and then respond to at least 3 of your classmates’ initial posts. You should also respond to anyone who has responded to you.
The full "accounting cycle" which culminates in closing the books and producing financial statements. Discuss the differences between Permanent "real" accounts and Temporary ¨nominal¨ accounts:
1. What type of information is contained in nominal accounts, and what type of information is contained in real accounts?
2. Which financial statement contains the information from nominal accounts and which contains the information from real accounts?
3. Provide an example of real accounts and an example of nominal accounts.
Answer:
The Accounting Cycle: Permanent and Temporary Accounts
1. The information that is contained in the nominal accounts is revenues and expenses, incomes, and losses. The information that is contained in the real accounts is assets, liabilities, and equity.
2. Income Statement and Statement of Retained Earnings contain the information from nominal accounts. Balance Sheet contains information from real accounts.
3. An example of a real account is Accounts Receivable. An example of a nominal account is Service Revenue.
Explanation:
The differences between real or permanent accounts and nominal or temporary accounts are that permanent accounts include assets, liabilities, and equity accounts while temporary accounts include revenues and expenses. Permanent accounts are not closed to a financial period but rolled over from one accounting period to the next. Temporary accounts, on the other hand, are closed in the financial period. They do not roll over to the next period because their net effects are closed to a permanent account (equity).
A purchase of a pair of Italian designer jeans by a resident of Japan would be considered an_____when counting GDP in Japan. As a result, this purchase would be_____Japanese GDP. A purchase of a light pickup truck made in Japan and sold in Canada would be considered an_____for Japanese GDP, which would be_____Japanese GDP.
Answer and Explanation:
In the case when the purchase of Italian jeans made by the Japan resident so it would be considered an import at the time of counting GDP in Japan. So the purchase would be deducted or excluded from Japanese GDP
In the case when the purchase of truck would be made in Japan and then sold it in Canada so it would be considered as an export so the same would be included or added in Japanese GDP.
Oriole Company purchases Pharoah Company for $4350000 cash on January 1, 2021. The book value of Pharoah Company's net assets reported on its December 31, 2020 financial statement was $3750000. An analysis indicated that the fair value of Pharoah's tangible assets exceeded the book value by $630000, and the fair value of identifiable intangible assets exceeded book value by $335000. What amount of gain or goodwill is recognized by Oriole
Answer:
32,000
Explanation:
on paper and on edge 2021
You have a project that costs $750000. It has a 0.30 chance of paying off $3 million and a 0.70 chance of paying off nothing. What is the expected profit from the new project?
Answer:
10 million
sorry if im wrong
Explanation:
Mallory Industries has the following cost information for the year just ended:
Direct materials $6.00 per unit
Direct labor $2.00 per unit
Variable manufacturing overhead $1.50 per unit
Fixed manufacturing overhead $40,000
Variable selling and administrative cost $3.00 per unit
Fixed selling and administrative cost $50,000
During the year, Mallory produced 10,000 units, out of which 9,100 were sold for $50 each. What is net income under absorption costing?
Answer:
Results are below.
Explanation:
The absorption costing method includes all costs related to production, both fixed and variable. The unit product cost is calculated using direct material, direct labor, and total unitary manufacturing overhead.
First, we need to calculate the unitary cost value:
Unitary cost= (6 + 2 + 1.5) + 40,000/10,000
Unitary cost= $13.5
Now, the income statement:
Sales= 9,100*50= 455,000
COGS= (13.5*9,100)= (122,850)
Gross profit= 332,150
Total administrative costs= (3*9,100) + 50,000= (77,300)
Net operating income= 254,850
On January 1, 2018, the Moody Company entered into a transaction for 100% of the outstanding common stock of Osorio Company. To acquire these shares, Moody issued $400 in long-term liabilities and also issued 40 shares of common stock having a par value of $1 per share but a fair value of $10 per share. Moody paid $20 to lawyers, accountants, and brokers for assistance in bringing about this acquisition. Another $15 was paid in connection with stock issuance costs. Prior to these transactions, the balance sheets for the two companies were as follows:
Moody Osorio
Cash $ 180 $ 40
Receivables 810 180
Inventories 1,080 280
Land 600 360
Buildings (net) 1,260 440
Equipment (net) 480 100
Accounts payable (450 ) (80 )
Long-term liabilities (1,290 ) (400 )
Common stock ($1 par) (330 )
Common stock ($20 par) (240 )
Additional paid-in capital (1,080 ) (340 )
Retained earnings (1,260 ) (340 )
- Note: Parentheses indicate a credit balance. In Moody's appraisal of Osorio, three assets were deemed to be undervalued on the subsidiary's books: Inventory by $10, Land by $40, and Buildings by $60. 9) what amount was recorded as goodwill arising from this acquisition?
a. $230.
b. $120.
c. 520.
d. None, there is an gain on bargain purchase of $230.
e. None. there is a gain on bargain purchase of $265.
Answer:
d. None, there is an gain on bargain purchase of $230.
Explanation:
Total Consideration Paid = Long term liabilities + Common Stock + Excess of fair value of stock over par value
Long-term liabilities = $400, Common Stock (Par Value): $1.00 * 40 shares = $40, Excess of fair value of stock over par value = ($10 - $1) x (40 shares) = $9*40 = $360
Total Consideration: $400 + $40 + $360 = $800
Particulars Amount
Total consideration paid $800
Less: Fair value of asset
Cash $40
A. Receivables $180
Inventory $290
Land $400
Buildings $500
Equipment $100
Long term liabilities -$400
Accounts payable -$80 $1,030
Excess of fair value of acquisition price ($230)
Thus, there is no goodwill but gain on bargain purchase of $230.