Answer:
a. March 2, 202x, merchandise purchased on account from Splish Brothers, credit terms 2/10, n/30
Dr Merchandise inventory 885,600
Cr Accounts payable 885,600
b. March 6, 202x, defective/wrong merchandise returned to Splish Brothers
Dr Accounts payable 110,200
Cr Merchandise inventory 110,200
c. March 12, 202x, paid invoice to Splish Brothers within discount term
Dr Accounts payable 775,400
Cr Cash 759,892
Cr Purchase discounts 15,508
purchase discount = purchase balance x 2% = $775,400 x 2% = $15,508
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 $397,000The following information is taken from the accounts of Latta Company. The entries in the T-accounts are summaries of the transactions that affected those accounts during the year.
Manufacturing Overhead
(a) 488,448 (b) 407,040
Bal. 81,408
Work in Process
Bal. 9,960 (c) 758,000
302,000
91,000
(b) 407,040
Bal. 52,000
Finished Goods
Bal. 38,000 (d) 664,000
(c) 758,000
Bal. 132,000
Cost of Goods Sold
(d) 664,000
The overhead that had been applied to production during the year is distributed among Work in Process, Finished Goods, and Cost of Goods Sold as of the end of the year as follows:
Work in Process, ending $ 24,960
Finished Goods, ending 63,360
Cost of Goods Sold 318,720
Overhead applied $ 407,040
For example, of the $52,000 ending balance in work in process, $24,960 was overhead that had been applied during the year.
Required:
1. Identify reasons for entries (a) through (d).
2. Assume that the underapplied or overapplied overhead is closed to Cost of Goods Sold. Prepare the necessary journal entry.
3. Assume that the underapplied or overapplied overhead is closed proportionally to Work in Process, Finished Goods, and Cost of Goods Sold.
Prepare the necessary journal entry.
Answer:
1.
(a) is the Actual Manufacturing Overhead Expense incurred for the year.
(b) is the Manufacturing overhead applied to Work in Process for the year.
(c) is the Cost of goods manufactured for the year.
(d) is the Cost of goods sold for the year.
2. Journal Entry:
Debit Cost of Goods Sold $81,408
Credit Manufacturing Overhead $81,408
To close the underapplied overhead to cost of goods sold.
3. Journal Entry:
Debit Work in Process $4,992
Finished Goods $12,672
Cost of goods sold $63,744
Credit Manufacturing Overhead $81,408
To close the underapplied overhead to the 3 accounts.
Explanation:
a) Data and Calculations:
1. T-accounts:
Manufacturing Overhead
Debit Credit
a) 488,448 (b) 407,040
Bal. 81,408
Work in Process
Debit Credit
Bal. 9,960 (c) 758,000
302,000
91,000
(b) 407,040
Bal. 52,000
Finished Goods
Debit Credit
Bal. 38,000 (d) 664,000
(c) 758,000
Bal. 132,000
Cost of Goods Sold
Debit Credit
(d) 664,000
2. Distribution of overhead applied to production:
Work in Process, ending $ 24,960
Finished Goods, ending 63,360
Cost of Goods Sold 318,720
Overhead applied $ 407,040
3. Allocation of Underapplied:
Work in Process, ending $4,992 (24,960/407,040 * 81,408)
Finished Goods, ending 12,672 (63,360/407,040 * 81,408)
Cost of Goods Sold 63,744 (318,720/407,040 * 81,408)
4. The Underapplied overhead is $81,408. This figure is stated as the balance on the Manufacturing overhead account. It means that the applied overhead is less than the actual overhead incurred by $81,408.
What businesses have the biggest contribution to socioeconomic development of the philippines
Answer:
Philippine chemicals industry.
Explanation:
Philippine chemical industry strives to turn the raw resources of the country into a wide variety of higher-demand goods that serve the best consumer benefit for domestic and global business needs. It can achieve sustainable growth by constantly developing goods and processes, and thereby lead to the employment generation and socio-economic prosperity of the country.
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.
During September 20Y2, Lisa managed the tennis courts and entered into the following transactions:
9/1 Opened a business account by contributing $950.
9/1 Paid $300 for tennis supplies (practice tennis balls, etc.).
9/1 Paid $275 for the rental of video equipment to be used in offering lessons during September.
9/1 Arranged for the rental of two ball machines during September for $250. Paid $100 in advance, with the remaining $150 to be paid October 1.
9/30 Received $1,750 for lessons given during September.
9/30 Received $600 in fees from the use of the ball machines during September.
9/30 Paid $800 for salaries of part-time employees who answered the telephone and took reservations while Lisa was giving lessons.
9/30 Paid $290 for miscellaneous expenses.
9/30 Received $1,300 (325 per week) from the club for managing the tennis courts during September.
9/30 Determined that the cost of supplies on hand at the end of the month totaled $180; therefore, the cost of supplies used was $120.
9/30 Withdrew $400 (similar to Dividend) for personal use on September 30.
Journalize entries for above transactions.
Answer:
9/1 Opened a business account by contributing $950.
Dr Cash 950
Cr Lisa, capital, 950
9/1 Paid $300 for tennis supplies (practice tennis balls, etc.).
Dr Supplies 300
Cr Cash 300
9/1 Paid $275 for the rental of video equipment to be used in offering lessons during September.
Dr Rent expense 275
Cr Cash 275
9/1 Arranged for the rental of two ball machines during September for $250. Paid $100 in advance, with the remaining $150 to be paid October 1.
Dr Rental expense 250
Cr Cash 100
Cr Accounts receivable 150
9/30 Received $1,750 for lessons given during September.
Dr Cash 1,750
Cr Fees earned 1,750
9/30 Received $600 in fees from the use of the ball machines during September.
Dr Cash 600
Cr Fees earned 600
9/30 Paid $800 for salaries of part-time employees who answered the telephone and took reservations while Lisa was giving lessons.
Dr Wages expense 800
Cr Cash 800
9/30 Paid $290 for miscellaneous expenses.
Dr Miscellaneous expenses 290
Cr Cash 290
9/30 Received $1,300 (325 per week) from the club for managing the tennis courts during September.
Dr Cash 1,300
Cr Fees earned 1,300
9/30 Determined that the cost of supplies on hand at the end of the month totaled $180; therefore, the cost of supplies used was $120.
Dr Supplies expense 120
Cr Supplies 120
9/30 Withdrew $400 (similar to Dividend) for personal use on September 30.
Dr Lisa, drawings 400
Cr cash 400
Following are income statements for Hossa Corporation for 20X1 and 20x2. Percentage of sales amounts are also shown for each operating expense item. Hossa's income tax rate was 22% in 20X1 and 24% in 20X2
2011 2012
($ 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
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
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.
Why is investing in gold beneficial?
A. It is easy to mine.
B. It is considered a stable investment
C. Gold is more expensive than stocks.
D. The value of hold is subject to inflation.
Answer:
B
Explanation:
The value of gold is usually very consistent especially when accounting for inflation
Consider two neighboring island countries called Euphoria and Bellissima. They each have 4 million labor hours available per week that they can use to produce jeans, corn, or a combination of both. The following table shows the amount of jeans or corn that can be produced using 1 hour of labor.Country Jeans Corn (Pairs per hour of labor) (Bushels per hour of labor)Euphoria 5 20Bellissima 8 16Initially, suppose Bellissima uses 1 million hours of labor per week to produce jeans and 3 million hours per week to produce corn, while Euphoria uses 3 million hours of labor per week to produce jeans and 1 million hours per week to produce corn. Consequently, Euphoria produces 15 million pairs of jeans and 20 million bushels of corn, and Bellissima produces 8 million pairs of jeans and 48 million bushels of corn. Assume there are no other countries willing to trade goods, so in the absence of trade between these two countries, each country consumes the amount of jeans and corn it produces.Euphoria’s opportunity cost of producing 1 pair of jeans is of corn, and Bellissima's opportunity cost of producing 1 pair of jeans is of corn. Therefore, has a comparative advantage in the production of jeans, and has a comparative advantage in the production of corn.Suppose that each country completely specializes in the production of the good in which it has a comparative advantage, producing only that good. In this case, the country that produces jeans will producemillion pairs per week, and the country that produces corn will producemillion bushels per week.In the following table, enter each country's production decision on the third row of the table (labeled "Production"). Euphoria Bellissima Jeans Corn Jeans Corn (Millions of pairs) (Millions of bushels) (Millions of pairs) (Millions of bushels)Without TradeProduction 15 20 8 48Consumption 15 20 8 48With TradeProduction Imports/Exports Consumption Gains from TradeIncrease in Consumption Suppose the country that produces jeans trades 18 million pairs of jeans to the other country in exchange for 54 million bushels of corn.In the previous table, use the dropdown menus across the row labeled "Imports/Exports" to select the amount of each good that each country imports and exports. Then enter each country’s final consumption of each good on the line labeled "Consumption."When the two countries did not specialize, the total production of jeans was 23 million pairs per week, and the total production of corn was 68 million bushels per week. Because of specialization, the total production of jeans has increased bymillion pairs per week, and the total production of corn has increased bymillion bushels per week.Because the two countries produce more jeans and more corn under specialization, each country is able to gain from trade.Calculate the gains from trade—that is, the amount by which each country has increased its consumption of each good relative to the first row of the previous table. Enter this difference in the boxes across the last row (labeled "Increase in Consumption").
Answer:
Country Jeans Corn
Euphoria 5 20 (15 + 20)
Bellissima 8 16 (8 + 48)
Bellisima's opportunity cost:
Production of corn per million hours of labor = 8 / 16 = 0.5 pairs of jeans Production of jeans per million hours of labor = 16 / 8 = 2 bushels of cornEuphoria's opportunity cost:
Production of corn per million hours of labor = 5 / 20 = 0.25 pairs of jeans Production of jeans per million hours of labor = 20 / 5 = 4 bushels of cornEuphoria has a comparative advantage int he production of corn while Bellisima has a comparative advantage in the production of jeans.
If both countries specialize:
Euphoria will produce 80 million bushels of corn. Bellisima will produce 32 million pairs of jeans.Total production of corn has increased by 12 million bushels.
Total production of jeans has increased by 9 million pairs.
Assuming that Bellisima trades 18 million pairs of jeans and Euphoria exchanges 54 million bushels of corn, then:
Euphoria's consumption of jeans will increase by 3 million pairs, while their consumption of corn will increase by 6 million bushels. Bellisima's consumption of jeans will increase by 10 million pairs, while their consumption of corn will increase by 6 million bushels.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
In each of the following cases, determine how much GDP and each of its components is affected, if at all:
A. Debbie spends $200 to buy her husband dinner at the finest restaurant in Boston.
B. Sarah spends $1800 on a new laptop to use in her publishing business. The laptop was built in China.
C. Jane spends $1200 on a computer to use in her editing business. She got last year’s model on sale for a great price from a local manufacturer.
D. General Motors builds $500 million worth of cars, but consumers only buy $470 million worth of them.
Computing GDP: 2018 (base year) 2019 2020 P Q P Q P QGood A $30 $900 $31 $1000 $36 $1050Good B $100 $192 $102 $200 $100 $205
2. Use the above data to solve these problems:A. Compute nominal GDP in 2018.B. Compute real GDP in 2019.C. Compute the GDP deflator in 2020.
Answer:
Follows are the solution to this question:
Explanation:
In option A, Its increase in consumption and GDP is $200.
In option B, Investment decisions increase about $1800, net exports drop by $1800 and therefore GDP should remain constant.
In option C, GDP or investment wasn’t increasing only at present because estimates were produced last year.
In option D, Market growth is $470 million, options trading is rising by $30 million but GDP is growing by $500 million.
GDP is just a misleading indicator, it does not take into account recreation, environmental protection, education and health rates, non-market behaviors, changes in wealth disparity, increases of variety or rises in innovation. HDI's social progress Index could be used to highlight a need for people or their ability to assess national growth as the supreme requirement.
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
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
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
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
The following balance sheet for the Los Gatos Corporation was prepared by a recently hired accountant. In reviewing the statement you notice several errors.
LOS GATOS CORPORATION
Balance Sheet
At December 31, 2018
Assets
Cash $ 74,000
Accounts receivable 131,000
Inventories 72,000
Machinery (net) 137,000
Franchise (net) 47,000
Total assets $ 461,000
Liabilities and Shareholders’ Equity
Accounts payable $ 84,000
Allowance for uncollectible accounts22,000
Note payable 89,000
Bonds payable 127,000
Shareholders’ equity 139,000
Total liabilities and shareholders’ equity $
461,000
Additional information:
Cash includes a $37,000 restricted amount to be used for repayment of the bonds payable in 2022.
The cost of the machinery is $224,000.
Accounts receivable includes a $37,000 note receivable from a customer due in 2021.
The note payable includes accrued interest of $22,000. Principal and interest are both due on February 1, 2019.
The company began operations in 2013. Income less dividends since inception of the company totals $52,000.
67,000 shares of no par common stock were issued in 2013. 100,000 shares are authorized.
Required:
Prepare a corrected, classified balance sheet. (Amounts to be deducted should be indicated by a minus sign.)
Answer:
Los Gatos Corporation
Corrected, Classified Balance Sheet
LOS GATOS CORPORATION
Balance Sheet
At December 31, 2018
Assets
Current Assets:
Cash $ 37,000
Restricted Cash 37,000
Accounts receivable 94,000
Allowance for
uncollectibles 22,000 72,000
Inventories 72,000
Total current assets $218,000
Long-term Assets:
Note receivable 37,000
Machinery 224,000
Acc. Depreciation 87,000 137,000
Franchise (net) 47,000
Total long-term assets $221,000
Total assets $ 439,000
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable $ 84,000
Accrued interest 22,000
Note payable 67,000
Total current liabilities $173,000
Long-term liabilities
Bonds payable 127,000
Shareholders’ equity
Common Stock, 100,000 authorized
67,000 shares of no par issued 87,000
Retained earnings 52,000 139,000
Total liabilities and shareholders’ equity $ 439,000
Explanation:
a) Data and Calculations:
LOS GATOS CORPORATION
Balance Sheet
At December 31, 2018
Assets
Cash $ 74,000
Accounts receivable 131,000
Inventories 72,000
Machinery (net) 137,000
Franchise (net) 47,000
Total assets $ 461,000
Liabilities and Shareholders’ Equity
Accounts payable $ 84,000
Allowance for
uncollectibles 22,000
Note payable 89,000
Bonds payable 127,000
Shareholders’ equity 139,000
Total liabilities and shareholders’ equity $ 461,000
Adjustment based on additional information:
Cash $ 74,000
Bonds Payable restricted 37,000
Cash balance $37,000
Machinery (net) 137,000
Cost of machinery 224,000
Acc. Depreciation 87,000
Accounts receivable 131,000
Long-term Note receivable 37,000
Balance 94,000
Short-term liabilities:
Note payable 89,000
Accrued interest 22,000
Note payable 67,000
Retained earnings = $52,000
Shareholders’ equity 139,000
Retained earnings 52,000
Balance in equity 87,000
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)
A landowner has just acquired 370 acres of new land, and is using the Cost-Benefit Principle to decide between three alternative uses for the land: growing corn, growing soybeans, or renting it to a local farmer. If corn is planted, the landowner expects to earn $980 per acre, while soybeans pay only $575 per acre. Renting the land earns the landowner $400 per acre. In addition, the cost of growing and harvesting corn is estimated to be $203,500, while only $88,800 for soybeans. We can assume there are no costs associated with renting the land.
Required:
a. For this landowner, the opportunity, or implicit cost of growing corn is $___________ from____________
b. The opportunity, or implicit cost of growing soybeans is $___________ from ___________
c. The landowner maximizes economic surplus by ____________
Answer:
See explanation below.
Explanation:
a. Opportunity cost is a term in economic, which is used to express cost, in terms of forgone alternatives.
For this landowner , the opportunity , or implicit cost of growing corn is $148,000 [$400 per acre × 370 acres] from renting the land.
b. The opportunity cost or implicit cost of growing soya beans is $148,000 [$400 × 370 acres] from renting the land.
c. The landowner maximizes economic surplus by renting the land.
On January 2, Chaz transfers cash of $143,400 to a newly formed corporation for 100% of the stock. In its initial year, the corporation has net income of $35,850. The income is credited to its earnings and profits account. The corporation distributes $10,755 to Chaz.
A. How do Chaz and the corporation treat the $10,755 distribution?
B. Assume instead that Chaz transfers to the corporation cash of $71,700 for stock and cash of $71,700 for a note of the same amount. The note is payable in equal annual installments of $7,170 and bears interest at the rate of 6%. No distributions are made during the year to Chaz. However, at the end of the year, the corporation pays an amount to meet the loan obligation(i.e., the annual $7,170 principal payment plus the interest due). Determine the total amount of the payment and its tax treatment to Chaz and the corporation.
The corporate payment to Chaz totals $_____. Chaz has interest of $______ and a note repayment of $____ of which $____is taxable to Chaz. The corporation has a deduction of $____$ of which $ is taxable to Chaz. The corporation has a deduction of $.
Answer: See explanation
Explanation:
A. Chaz has a taxable dividend of $10,755 and the corporation has a deduction of $0.
It should be noted that the dividend will be taxable once it gets to the receivers hand while the corporation will have a deduction of 0
B. The corporate payment to Chaz totals $11472. Chaz has interest of $4302 and a note repayment of $7170 of which $4302 is taxable to Chaz. The corporation has a deduction of $4302
Notes:-
Interest = $71700 × 6%
= $71700 × 0.06
= $4302
Total repayment:
= First installment + Interest
= $7170 + $4302
= $11472
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.
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.
Considering all of the factors listed in the preceding SWOT analysis question, which of the following strategies would make the most sense for the Cubs in the upcoming season? A. Assume that as the players age, they will continue to produce at their current levels. B. Keep the Cubs intact and do not hire any new players because the team was good enough to win the World Series. C. Sign a free-agent outfielder to bolster the current roster and sign the current pitchers to long-term contracts. D. Trade the Cubs’ current pitchers to another team for minor-league prospects who aren’t ready for the major league.
Answer:
b. Sign a free-agent outfielder to bolster the current roster and sign the young pitchers to long-term contract.
Explanation:
Sign a free-agent outfielder to bolster the current roster and sign the young pitchers to long-term contract. Keeping the existing strength will provide a competitive advantage to the firm. This strategy will help to add strength to the existing team as well as prepare a long term team.
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.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
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.
Crane Company applies overhead on the basis of machine hours. Given the following data, compute overhead applied and the under- or overapplication of overhead for the period:
Estimated annual overhead cost $1700000
Actual annual overhead cost $1675000
Estimated machine hours 400000
Actual machine hours 390000
$1657500 applied and $17500 overapplied
$1657500 applied and $17500 underapplied
$1675000 applied and neither under-nor overapplied
$1700000 applied and $17500 overapplied
Answer:
$1657500 applied and $17500 overapplied
Explanation:
The computation of overhead applied and the under- or overapplication of overhead for the period is shown below:-
Predetermined overhead rate = Estimated annual overhead ÷ Estimated machine hours
=($1,700,000 ÷ 400,000)
= $4.25 per machine hours
Overhead applied = Predetermined overhead rate × Actual machine hours
= $4.25 × 390,000
= $1,657,500
The overhead applied is lower than the actual overhead cost;
overhead underapplied = $1,675,000 - $1,657,500
= $17,500
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
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.