Answer with Explanation:
Requirement 1. The economic life of a business can be divided into artificial time periods.
It is a periodicity assumption which says that the business time periods can be used to prepare financial statement as per the need of the management or other organization to make meaningful decisions.
Requirement 2. The business will continue in operation long enough to carry out its existing objectives.
It is going concern assumption which says that the company will continue its business for foreseeable future and thus the financial reporting exists. If this assumption wasn't present then the financial reporting would had only included "How to prepare financial statements on breakup basis?". Which is the situation when the company goes bankrupt and we have to prepare in breakup basis which says that the business will not continue for the foreseeable future.
Requirement 3. Assets should be recorded at their cost.
It is based on Historical cost principle which says that the contracts formed and the prices agreed would be incorporated in the financial reporting.
Requirement 4. Economic events can be identified with a particular unit of accountability.
It is Economic entity assumption which says that every stakeholder is an entity. For example, engineer, schools, leather company, Honda company, Gucci, Boss inc, etc are the examples of economic entity.
Requirement 5. Circumstances and events that make a difference to financial statement users should be disclosed.
It is talking about Disclosure principle which says that the circumstances and events that has potential to alter the decision making of the user of financial statement, must be disclosed in notes to financial statements.
Requirement 6. Only transaction data that can be expressed in terms of money should be included in the accounting records.
The statement is clear reflection of Monetary Unit assumption which says that the dealings of company that can be measured in financial terms can only be recorded in the books of accounts.
On January 1, Merry Walker and other stockholders established a catering service. Listed below are accounts to use for transactions (a) through (f), each identified by a number. Following are the transactions that occurred in Walker's first month of operations. You need to indicate for each transaction the accounts that should be debited and credited by placing the account number(s) in the appropriate box (if more than one account is applicable, enter the numbers separated by a comma and without any space e.g. "1,3").
1. Cash
2. Accounts Receivable
3. Supplies
4. Prepaid Insurance
5. Equipment
6. Truck
7. Notes Payable
8. Accounts Payable
9. Common Stock
10. Dividends
11. Fees Earned
12. Wages Expense
13. Rent Expense
14. Utilities Expense
15. Truck Expense
16. Miscellaneous Expense
17. Insurance Expense
a. TransactionsAccount(s) DebitedAccount(s) Crediteda. Recorded jobs completed on account and sent invoices to customers.
b. Received an invoice for truck expenses to be paid in February.
c. Paid utilities expense
d. Received cash from customers on account.
e. Paid employee wages.
f. Paid dividends to stockholders.
What will be an ideal response?
Answer:
Transactions Account Debited Account Credited
a. Recorded jobs completed on 2 11
account and sent Invoices to
customers
b. Received an invoice for truck 15 8
expense to be paid in February
c. Paid utilities expense. 14 1
d. Received cash from customers on 1 2
account.
e. Paid employee wages. 12 1
S/n Transaction no Journal entry
a. Accounts receivable a/c Dr
To fees earned a/c Cr
b. Truck expense a/c Dr
To accounts payable a/c Cr
c. Utilities a/c Dr
To cash a/c Cr
d. Cash a/c Dr
To accounts receivable a/c Cr
e. Wages Expenses Dr
To Account Payable a/c Cr
The accounting department of your company has just delivered a draft of the current year's financial statements to you. The summary is as follows:
Beginning of the Year End of the Year
Total Assets $550,000 $573,000
Total Liabilities 210,000 217,000
Total Equity 340,000 356,000
Net Income for the Year 101,900
Common Shares Outstanding 22,000 22,000
You discovered that they have not adjusted for estimated bad debt expenses of $8,500. For each of the following ratios, calculate:
a. The ratio that would have resulted had the error not been discovered (i.e. the incorrect ratio).
b. The correct ratio.
1. ROE
2. ROA
3. Debit ratio
4. EPS
Answer and Explanation:
The computation is shown below:-
Incorrect
ROA = Net Income ÷ Average assets
= $101,900 ÷ (($550,000 + $573,000) ÷ 2)
= $101,900 ÷ $561,500
= 0.18
ROE = Net Income ÷ Average equity
= $101,900 ÷ (($340,000 + 356,000) ÷ 2)
= $101,900 ÷ $348,000
= 0.29
Debt Ratio = Total debt ÷ Average Assets
= $217,000 ÷ (($550,000 + $573,000) ÷ 2)
= $217,000 ÷ $561,500
= 0.39
EPS = Net Income ÷ Number of Common Shares
= $101,900 ÷ 22,000
= $4.63
Correct
ROA = Net Income ÷ Average assets
= ($101,900 - $8,500) ÷ (($550,000 + $573,000 - $8,500) ÷ 2)
= $93,400 ÷ $557,250
= 0.17
ROE = Net Income ÷ Average equity
= ($101,900 - $8,500) ÷ (($340,000 + 356,000 - $8,500) ÷ 2)
= $93,400 ÷ $343,750
= 0.27
Debt Ratio = Total debt ÷ Average Assets
= $217,000 ÷ (($550,000 + $573,000 - $8,500) ÷ 2)
= $217,000 ÷ $276,500
= 0.78
EPS = Net Income ÷ Number of Common Shares
= ($101,900 - $8,500) ÷ 22,000
= $4.25
Alan works as a salesperson for an insurance company. Recently, he sold an insurance policy to a new customer. During their conversation, Alan made a list of all the benefits that the policy would offer the customer. He politely asked the customer to list the various drawbacks of buying the policy. In the end, Alan was able to close the sale because the benefits greatly outnumbered the drawbacks. Which closing technique did Alan use in this scenario?
A.
assumptive close
B.
Ben Franklin close
C.
porcupine close
D.
Sharp Angle close
Answer:B) Ben Franklin close
Explanation:
Answer:
Correct is B.)
Explanation:
correct on edmentum
ZigZag Cola produces a lemon-lime soda. The production process starts with workers mixing the lemon syrup and lime flavors in a secret recipe. The company enhances the combined syrup with caffeine. Finally, the company dilutes the mixture with carbonated water. ZigZag Cola incurs the following costs (in thousands):
Plant janitors' wages $ 900
Delivery truck drivers' wages $ 275
Payment for new recipe $ 1,300
Depreciation on delivery trucks $ 175
Plant utilities $ 650
Lime flavoring $ 1,180
Rearranging plant layout $ 1,600
Bottles $ 1,040
Salt 50
Sales commissions $ 325
Production costs of "cents-off' store coupons for customers $ 770
Lemon syrup $ 16,000
Replace products with expired dates upon customer complaint $ 70
Depreciation on plant and equipment $ 2,700
Wages of workers who mix syrup $ 7,800
Customer hotline $ 180
Freight-in on materials $ 2,000
Requirements 1, 2 and 3. Classify each of these costs according to its category in the value chain and further break down production costs into three subcategories: Direct Materials (DM), Direct Labor (DL), or Manufacturing Overhead (MOH). Compute the total costs for each value chain category.
Answer:
Zig Zag Cola
1. Classification of costs according to their category in the value chain:
a. Inbound logistics (relationship with suppliers):
New recipe $ 1,300
Lime flavoring $ 1,180
Bottles $ 1,040
Salt $ 50
Lemon syrup $ 16,000
Freight-in on materials $ 2,000
Total cost of Inbound logistics = $21,500
b. Operations:
Wages of workers who mix syrup $ 7,800
Plant janitors' wages $ 900
Plant utilities $ 650
Rearranging plant layout $ 1,600
Depreciation on plant & equipment $ 2,700
Total cost of Operations = $13,650
c. Outbound logistics:
Delivery truck drivers' wages $ 275
Depreciation on delivery trucks $ 175
Total outbound logistics cost $450
d. Marketing and sales:
Customer hotline $ 180
Sales commissions $ 325
Sales coupons for customers $ 770
Total marketing and sales cost $1,275
e. Service:
Customer hotline $ 180
Sales coupons for customers $ 770
Product Replacement $ 70
Total costs of Services $1,020
2. Subcategories of Production Costs:
Direct Materials:
New recipe $ 1,300
Lime flavoring $ 1,180
Bottles $ 1,040
Salt $ 50
Lemon syrup $ 16,000
Freight-in
on materials $ 2,000
Cost of materials $21,500
Direct Labor:
Wages of workers who mix syrup $ 7,800
Total cost of direct labor $ 7,800
Manufacturing Overheads:
Plant janitors' wages $ 900
Plant utilities $ 650
Rearranging plant layout $ 1,600
Depreciation on plant & equipment $ 2,700
Total Overheads $ 5,85
Explanation:
a) Data and Calculations:
Costs incurred (in thousands)
Direct Materials:
New recipe $ 1,300
Lime flavoring $ 1,180
Bottles $ 1,040
Salt $ 50
Lemon syrup $ 16,000
Freight-in
on materials $ 2,000
Cost of materials $21,500
Direct Labor:
Wages of workers who mix syrup $ 7,800
Total cost of direct labor $ 7,800
Manufacturing Overheads:
Plant janitors' wages $ 900
Plant utilities $ 650
Rearranging plant layout $ 1,600
Depreciation on plant & equipment $ 2,700
Overheads $ 5,850
Selling and Distribution Expenses:
Depreciation on delivery trucks $ 175
Delivery truck drivers' wages $ 275
Sales commissions $ 325
Customer hotline $ 180
Sales coupons for customers $ 770
Product Replacement $ 70
Selling and Distribution costs $1,795
b) ZigZag's value chain activities, according to Michael Porter, include inbound logistics, operations, outbound logistics, marketing and sales, and service. These activities create value that exceeds their cost for the purpose of generating a higher profit. In a similar way, ZigZag's production costs can be categorized into direct materials, direct labor, and manufacturing overhead.
Windsor, Inc. was started on May 1. A summary of May transactions is presented below.
1. Stockholders invested $23,500 cash in the business in exchange for common
stock.
2. Purchased equipment for $4,000 cash.
3. Paid $200 cash for May office rent.
4. Paid $600 cash for supplies.
5. Incurred $150 of advertising costs in the Beacon News on account.
6. Received $4,900 in cash from customers for repair service.
7. Declared and paid a $1,400 cash dividend.
8. Paid part-time employee salaries $1,200.
9. Paid utility bills $140.
10. Performed repair services worth $1,020 on account.
11. Collected cash of $110 for services billed in transaction (10).
Required:
Prepare a tabular analysis of the transactions. Revenue is called service revenue.
Answer: See explanation
Explanation:
The tabular analysis of the transactions had been prepared and attached. The tabular analysis consist of heading such as cash, account receivable, supplies, equipment, account payable, common stock, revenue, expense and dividends.
Check the attachment for the solution.
what is marginal utility
Sales Budget Assume that Stillwater Designs produces two automotive subwoofers: S12L7 and S12L5. The S12L7 sells for $475, and the S12L5 sells for $300. Projected sales (number of speakers) for the coming five quarters are as follows:
$12L7 $12L5
First quarter, 20Y1 800 1,300
Second quarter, 20Y1 2,200 1,400
Third quarter, 20Y1 5,600 5,300
Fourth quarter, 20Y1 4,600 3,900
First quarter, 20Y2 900 1,200
The vice president of sales believes that the projected sales are realistic and can be achieved by the company.
Required:
1. Prepare a sales budget for each quarter of 20Y1 and for the year in total. Show sales by product and in total for each time period. Do not include a multiplication symbol as part of your answer.
Stillwater Designs
Sales Budget
For the Year Ended December 31, 20Y1
1st Qtr. 2nd Qtr. 3rd Qtr. 4th Qtr. Total
$12L7:
Units
Price
Sales
$12L5:
Units
Price
Sales
Total sales
How will Stillwater Designs use this sales budget?
1. Stillwater Designs will use the sales budget in planning as the basis for the production budget.
2. The company can also compare actual sales against the budget to see if expectations were achieved.
3. Both 1 and 2.
4. None of the above.
Answer:
1) Stillwater Designs
Sales Budget
For the year ended December 31, 20y1
Q1Y1 Q2Y1 Q3Y1 Q4Y1 Total
S12L7:
Units sold 800 2,200 5,600 4,600 13,200
Unit price $475 $475 $475 $475 $475
Revenue $380,000 $1,045,000 $2,660,000 $2,185,000 $6,270,000
S12L5:
Units sold 1,300 1,400 5,300 3,900 11,900
Unit price $300 $300 $300 $300 $300
Revenue $390,000 $420,000 $1,590,000 $1,170,000 $3,570,000
Total $770,000 $1,465,000 $4,250,000 $3,355,000 $9,840,000
sales
2) How will Stillwater Designs use this sales budget?
3. Both 1 and 2.
1. Stillwater Designs will use the sales budget in planning as the basis for the production budget. 2. The company can also compare actual sales against the budget to see if expectations were achieved.A sales budget serves two basic purposes:
It serves as a planning tool in order to prepare a production budget and a cash collections budget. It also serves as a control tool since management can use them to control the performance of different diversions, e.g. obviously it sets the goals for marketing and sales division, but it is also useful when controlling perceived product quality.Bill was severely injured when he was hit by a car while jogging. He spent one month in the hospital and missed three months of work because of the injuries. Total medical costs were $54,000. Bill received the following payments as a result of the accident:
His employer-provided accident insurance reimbursed him for $43,200 of the medical costs and provided him with $3,800 in sick pay while he was out of work.
A private medical insurance policy purchased by Bill paid him $10,800 for medical costs.
His employer gave Bill $7,200 to help him get through his re-habilitation period.
A separate disability policy that Bill had purchased paid him $3,800.
How much gross income does Bill have as a result of the payments received for the accident?
Answer:
$11,000
Explanation:
In order to calculate gross income for the payments received as a result of the accident, we will consider the amount provided by Bill's employer as a result of being out of work and add it with money provided for rehabilitation process.
In this case, the sick during out of work is $3,800 and amount for rehabilitation period help is $7,200. Hence, the gross income is $11,000.
Note: The medical reimbursement are not taxable and are therefore not calculated as an individuals gross income.
The following cost data relate to the manufacturing activities of Chang Company during the just completed year Manufacturing overhead costs incurred Indirect materials Indirect labor Property taxes, factory Utilities, factory Depreciation, factory Insurance, factory Total actual manufacturing overhead costs incurred $ 15,000 130,000 8,000 70,000 240,000 10,000 $473,000 Other costs incurred Purchases of raw materials (both direct and indirect) Direct labor cost $400,000 $60,000 Inventories: Raw materials, beginning. Raw materials, ending Work in process, beginning Work in process, ending $20,000 $30,000 $40,000 $70,000 The company uses a predetermined overhead rate of $25 per machine-hour to apply overhead cost to jobs. A total of 19,400 machine-hours were used during the year. Required: 1. Compute the amount of underapplied or overapplied overhead cost for the year 2. Prepare a schedule of cost of goods manufactured for the year
Answer and Explanation:
The computation of the amount of underapplied or overapplied overhead cost is shown below:-
Overapplied overhead cost = Actual Manufacturing overhead costs - Manufacturing overhead applied
= $473,000 - (19,400 × $25)
= $473,000 - $485,000
= $12,000
2. The Preparation of cost of goods manufactured for the year is shown below:-
Chang Company
Cost of goods manufactured
Direct materials:
Raw materials inventory, beginning $20,000
Add: Purchases of raw materials $400,000
Raw materials available for use $420,000
Less: Raw materials inventory, ending $30,000
Raw materials used in production $390,000
Less: Indirect materials $15,000 $375,000
Direct labor $60,000
Manufacturing overhead cost
applied to work in process $485,000
Total manufacturing costs $920,000
Add: Work in process inventory, beginning $40,000
Less: Work in process inventory, ending $70,000
Cost of goods manufactured $890,000
Atlas Enterprises Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows:
Activity Activity Rate
Fabrication $28 per machine hour
Assembly $20 per direct labor hour
Setup $75 per setup
Inspecting $30 per inspection
Production scheduling $12 per production order
Purchasing $8 per purchase order
The activity-base usage quantities and units produced for each product were as follows:
Elliptical
Activity Base Machines Treadmills
Machine hours 700 600
Direct labor hours 182 64
Setups 20 15
Inspections 10 16
Production orders 30 20
Purchase orders 56 75
Units produced 400 250
Required:
Use the activity rate and usage information to calculate the total activity cost and activity cost per unit for each product. Complete the Activity Tables for elliptical machines and treadmills. If required, round per-unit answers to the nearest cent.
Use the activity rate and usage information to calculate the total activity cost and activity cost per unit for elliptical machines product. Complete the Activity Table for elliptical machines. If required, round per-unit answers to the nearest cent.
Elliptical Machines
Activity Activity- Base Usage X Activity Rate = ActivityCost
Fabrication
Assembly
Setup
Inspecting
Production scheduling
Purchasing
Total activity cost
Number of units /
Activity cost per unit
Use the activity rate and usage information to calculate the total activity cost and activity cost per unit for treadmill product. Complete the Activity Table for treadmills. If required, round per-unit answers to the nearest cent.
Treadmills
Activity Activity- Base Usage X Activity Rate = ActivityCost
Fabrication
Assembly
Setup
Inspecting
Production scheduling
Purchasing
Total activity cost
Number of units /
Activity cost per unit
Answer:
Elliptical machines
Activity Activity
Activity Usage Rate Cost
Fabrication 700 28 19600
Assembly 182 20 3640
Setup 20 75 1500
Inspecting 10 30 300
Product Scheduling 30 12 360
Purchasing 56 8 448
Total 25848
Activity cost per unit = Total Activity cost / Number of Units = $25,848 / 400
Activity cost per unit = $64.62
Treadmills
Activity Activity
Activity Usage Rate Cost
Fabrication 600 28 16800
Assembly 64 20 1280
Setup 15 75 1125
Inspecting 16 30 480
Product Schedulling 20 12 240
Purchasing 75 8 600
Total 20525
Activity cost per unit = Total Activity cost / Number of Units = $20525 / 250
Activity cost per unit = $82.1
StorSmart Company makes plastic organizing bins. The company has the following inventory balances at the beginning and end of March: Beginning Inventory Ending Inventory Raw materials $ 29,700 $ 25,600 Work in process 22,400 46,100 Finished goods 78,300 69,800 Additional information for the month of March follows: Raw materials purchases $ 41,600 Indirect materials used 1,200 Direct labor 62,900 Manufacturing overhead applied 36,700 Selling, general, and administrative expenses 24,300 Sales revenue 237,000 Required: 1. Based on the above information, prepare a cost of goods manufactured report. 2. Based on the above information, prepare an income statement for the month of March.
Answer:
1. Cost of goods Manufactured Report
Beginning raw materials inventory $29,700
Add: Raw materials purchases $41,600
Less: Indirect materials ($1,200)
Less: Ending raw materials inventory ( $25,600)
Direct materials used in production $44,500
Direct labor $62,900
Manufacturing overhead $36,700
Total current manufacturing costs $144,100
Add: Beginning work in process inventory $22,400
Less: Ending work in process inventory ($46,100)
Cost of goods manufactured $120,400
2. Income Statement for March
Sales revenue $237,000
Less: Cost of goods sold
Cost of goods manufactured $120,400
Add: Beginning finished goods inventory $78,300
Less: Ending finished goods inventory $69,800
Cost of goods sold ($128,900)
Gross profit $108,100
Less:
Operating expenses (selling & administrative expenses) ( $24,300 )
Net operating income $83,800
Randy is the manager of a motel. As a condition of his employment, Randy is required to live in a room on the premises so that he would be there in case of emergencies. Randy considered this a fringe benefit since he would otherwise be required to pay $800 per month rent. The room that Randy occupied normally rented for $70 per night, or $2,100 per month. On the average, 90% of the motel rooms were occupied. As a result of this rent-free use of a room, Randy is required to include how much gross income?
Answer:
a. $0
Explanation:
a. $0
b. $800 per month.
c. $2,100 per month.
d. $1,890 ($2,100 x .90)
A (0)
It should be noted that gross income is the addition of all earnings, this could be the wages,profits, and so on that is available before the removal of taxes.
Therefore, From the question above, Randy, who is the manager that enjoy rent-free use of a room, will be required to include $0 as the gross income, because no deduction or taxes has been removed from the free rent he was enjoying, nothing was paid.
Bunnell Corporation is a manufacturer that uses job-order costing. On January 1, the company’s inventory balances were as follows:
Raw materials $ 40,000
Work in process $ 18,000
Finished goods $ 35,000
The company applies overhead cost to jobs on the basis of direct labor-hours. For the current year, the company’s predetermined overhead rate of $16.25 per direct labor-hour was based on a cost formula that estimated $650,000 of total manufacturing overhead for an estimated activity level of 40,000 direct labor-hours. The following transactions were recorded for the year:
a. Raw materials were purchased on account, $510,000
b. Raw materials use in production, $480000. All of of the raw materials were used as direct materials.
c. The following costs were accrued for employee services: direct labor, $600,000; indirect labor, $150,000; selling and administrative salaries, $240,000.
d. Incurred various selling and administrative expenses (e.g., advertising, sales travel costs, and finished goods warehousing), $367,000
e. Incurred various manufacturing overhead costs (e.g., depreciation, insurance, and utilities), $500,000.
f. Manufacturing overhead cost was applied to production. The company actually worked 41,000 direct labor-hours on all jobs during the year.
g. Jobs costing $1,680,000 to manufacture according to their job cost sheets were completed during the year.
h. Jobs were sold on account to customers during the year for a total of $2,800,000. The jobs cost $1,690,000 to manufacture according to their job cost sheets.
Required:
1. What is the journal entry to record the labor costs incurred during the year?
2. What is the total amount of manufacturing overhead applied to production during the year?
3. What is the total manufacturing cost added to Work in Process during the year?
4. What is the journal entry to record the transfer of completed jobs that is referred to in item g above?
5. What is the ending balance in Work in Process?
6. Is manufacturing overhead underapplied or overapplied for the year? By how much?
7. What is the ending balance in Finished Goods?
8. Assuming that the company closes its underapplied or overapplied overhead to Cost of Goods Sold, what is the adjusted cost of goods sold for the year?
9. What is the gross margin for the year?
10. What is the net operating income for the year?
Answer:
1. Dr Salaries and Administrative salaries 240,000
Dr Manufacturing Overhead 150,000
Dr Work in process 600,000
Cr Wages Payable 990,000
2. $666,250
3. $1,746,250
4. Dr Finished goods 1,680,000
Cr Work in Process 1,680,000
5. $84,250
6. $16,250
7. $25,000
8. $1,673,750
9. $1,126,250
10. $519,250
Explanation:
1. Preparation of the journal entry to record the labor costs incurred
Dr Salaries and Administrative salaries 240,000
Dr Manufacturing Overhead 150,000
Dr Work in process 600,000
Cr Wages Payable 990,000
(To record labor cost incurred)
2. Preparation of the total amount of manufacturing overhead applied to production
Manufacturing overhead applied= 41,000 hours * $16.25
Manufacturing overhead applied= $666,250
3. Preparation of the total manufacturing cost added to Work in Process
Raw Materials $480,000
Direct Labor 600,000
Manufacturing Overhead 666,250
Cost added to WIP $1,746,250
4. Preparation of the journal entry to record the transfer of completed jobs
Dr Finished goods 1,680,000
Cr Work in Process 1,680,000
(To record the transfer of completed jobs)
5. Calculation for the ending balance in Work in Process:
Ending balance in Work in Process
Beginning Balance $18,000
b $480,000
f $666,250
c $600,000 $1,680,000 g
Ending Balance $84,250
6. Calculation for Overapplied manufacturing overhead
Overapplied manufacturing overhead= ($666,250-$650,000)
Overapplied manufacturing overhead= $16,250
Based on the above calculation the manufacturing overhead is overapplied for the year By the amount of $16,250
7. Calculation for the ending balance in Finished Goods
Ending balance in Finished goods
Dr Beginning balance $35,000
Dr (g) 1,680,000
Cr $1,690,000 (h)
Dr Ending balance $25,000
8. Calculation for the adjusted cost of goods sold for the year
Cost of goods sold $1,690,000
Less:Manufacturing overhead $16,250
The cost of goods sold for the year $1,673,750
9. Calculation for the gross margin for the year
Sales $2,800,000
Less:Cost Of Goods Sold ($1,673,750)
Gross Profit $1,126,250
10. Calculation for the net operating income for the year
Gross Profit $1,126,250
Less:Selling and Administrative Salaries $240,000
Less: Selling and Administrative Expenses $367,000
Net Operating Income $519,250
The answers for the various sub-parts of the question are:
1. The journal entry has been attached below.
2. The total amount of manufacturing overhead applied to production during the year is $666,250
3. The total manufacturing cost added to Work in Process during the year is $1,746,250
4. The journal entry has been attached below.
5. The ending balance in Work in Process is $84,250
6. The manufacturing overhead for the year is $16,250
7. The ending balance in Finished Goods is $25,000
8. The adjusted cost of goods sold for the year is $1,673,750
9. The gross margin of the year is $1,126,250
10. The net operating for the year is $519,250
2. The total amount of manufacturing overhead applied to production:
Manufacturing overhead applied= [tex]41,000\: hours \times \$16.25[/tex]
Manufacturing overhead applied= $666,250
3 The total manufacturing cost added to Work in Process:
Raw Materials= $480,000
Direct Labor =600,000
Manufacturing Overhead =666,250
Cost added to WIP =$1,746,250
5. The ending balance in Work in Process:
Ending balance in Work in Process
Beginning Balance =$18,000
b. $480,000
f. $666,250
c. $600,000 $1,680,000 g
Ending Balance =$84,250
6. Overapplied manufacturing overhead:
Overapplied manufacturing overhead= ($666,250-$650,000)
Overapplied manufacturing overhead= $16,250
The manufacturing overhead is overapplied for the year By the amount of $16,250
7. The ending balance in Finished Goods:
Ending balance in Finished goods
Dr. Beginning balance $35,000
Dr (g) 1,680,000
Cr $1,690,000 (h)
Dr Ending balance $25,000
8. The adjusted cost of goods sold for the year:
Cost of goods sold $1,690,000
Less: Manufacturing overhead $16,250
The cost of goods sold for the year was $1,673,750
9. The gross margin for the year:
Sales $2,800,000
Less: Cost Of Goods Sold ($1,673,750)
Gross Profit $1,126,250
10. The net operating income for the year:
Gross Profit $1,126,250
Less: Selling and Administrative Salaries $240,000
Less: Selling and Administrative Expenses $367,000
Net Operating Income $519,250
To know more about the answers to the various sub-parts of the questions, refer to the link below:
https://brainly.com/question/14825752
Your company is estimated to make dividends payments of $2.2 next year, $3.8 the year after, and $4.8 in the year after that. The dividends will then grow at a constant rate of 6% per year. If the discount rate is 13% then what is the current stock price
Answer: $58.62
Explanation:
Current stock price = Present value of dividends + Present value of stock with constant dividend
Present value of stock with constant dividend = (Dividend in year 3 * (1 + Growth rate)) / (Discount rate - Growth rate)
= (4.8 * (1 + 6%)) / (13% - 6%)
= $72.6857142857
Current Stock Price = (2.2 / (1 + 13%)) +(3.8 / (1 + 13%)^2) + (4.8 / (1 + 13%)^3) + (72.6857142857/(1 + 13%) ^ 3)
= $58.62
Hults Corporation has provided data concerning the company's Manufacturing Overhead account for the month of November. Prior to the closing of the overapplied or underapplied balance to Cost of Goods Sold, the total of the debits to the Manufacturing Overhead account was $75,150 and the total of the credits to the account was $66,900. Which of the following statements is true?
A. Manufacturing overhead applied to Work in Process for the month was $68,800.B. Manufacturing overhead for the month was underapplied by $8,000.C. Manufacturing overhead transferred from Finished Goods to Cost of Goods Sold during the month was $68,800.D. Actual manufacturing overhead incurred during the month was $60,800.
Answer:
Manufacturing overhead for the month was underapplied by $8,250.
Explanation:
Since in the question it is mentioned that the total debits of manufacturing overhead is $75,150 and the total credits of manufacturing overhead is $66,900
So the difference is of
= $75,150 - $66,900
= $8,250
This amount would be reflected as an underapplied overhead
This is the answer and the same is to considered
The all options that are given are wrong.
Instructions
1. On October 1, 2018, Jay Crowley established Affordable Realty, which completed the following transactions during the month Oct Jay Crowley transferred cash from a personal bank account to an account to be used for the business in exchange for common stock, $40,000.
2. Paid rent on office and equipment for the month, $4,800.
3. Purchased supplies on account, $2,150.
4. Paid creditor on account, $1,100
5. Earned sales commissions, receiving cash, $18,750.
6. Paid automobile expenses (including rental charge) for month, $1,580, and miscellaneous expenses, $800
7. Paid office salaries, $3,500
8. Determined that the cost of supplies used was $1,300 9 Paid dividends, $1,500
1. Journalize entries for transactions Oct. 1 through 9. Refer to the Chart of Accounts for exact wording of account tities.
2. Post the journal entries to the Taccounts, selecting the appropriate date to the left of each amount to identify the transactions. Determine the account balances, after all posting is complete. Accounts containing only a single entry do not need a balance
3. Prepare an unadjusted trial balance as of October 31, 2018.
4. Determine the following:
a. Amount of total revenue recorded in the ledger
b. Amount of total expenses recorded in the ledger.
c. Amount of net income for October.
5. Determine the increase or decrease in retained earnings for October.
Answer:
Attached below is the required tables for questions 1 to 3
4) a)Amount of total revenue recorded in ledger = $18750
b)Amount of expenses recorded in ledger = $13480
c)Amount of net income for October = Total revenue - expenses
= $18750 - $13480 = $5270
5) The increase in retained earnings for October = $5270
Explanation:
4) a)Amount of total revenue recorded in ledger = $18750
b)Amount of expenses recorded in ledger = $13480
c)Amount of net income for October = Total revenue - expenses
= $18750 - $13480 = $5270
5) The increase in retained earnings for October = $5270
attached below is the required tables for questions 1 to 3
Pastina Company sells various types of pasta to grocery chains as private label brands. The company's reporting year-end is December 31. The unadjusted trial balance as of December 31, 2021, appears below.
Account Title Debits Credits
Cash 34,900
Accounts receivable 42,600
Supplies 2,800
Inventory 62,600
Notes receivable 22,600
Interest receivable 0
Prepaid rent 2,300
Prepaid insurance 8,600
Office equipment 90,400
Accumulated depreciation 33,900
Accounts payable 33,600
Salaries payable 0
Notes payable 52,600
Interest payable 0
Deferred sales revenue 3,300
Common stock 78,200
Retained earnings 35,000
Dividends 6,600
Sales revenue 159,000
Interest revenue 0
Cost of goods sold 83,000
Salaries expense 20,200
Rent expense 12,300
Depreciation expense 0
Interest expense 0
Supplies expense 2,400
Insurance expense 0
Advertising expense 4,300
Totals 395,600 395,600
Information necessary to prepare the year-end adjusting entries appears below.
Depreciation on the office equipment for the year is $11,300.
Employee salaries are paid twice a month, on the 22nd for salaries earned from the 1st through the 15th, and on the 7th of the following month for salaries earned from the 16th through the end of the month. Salaries earned from December 16 through December 31, 2021, were $1,400.
On October 1, 2021, Pastina borrowed $52,600 from a local bank and signed a note. The note requires interest to be paid annually on September 30 at 12%. The principal is due in 10 years.
On March 1, 2021, the company lent a supplier $22,600 and a note was signed requiring principal and interest at 8% to be paid on February 28, 2022.
On April 1, 2021, the company paid an insurance company $8,600 for a one-year fire insurance policy. The entire $8,600 was debited to prepaid insurance.
$860 of supplies remained on hand at December 31, 2021.
A customer paid Pastina $3,300 in December for 1,400 pounds of spaghetti to be delivered in January 2022. Pastina credited deferred sales revenue.
On December 1, 2021, $2,300 rent was paid to the owner of the building. The payment represented rent for December 2021 and January 2022 at $1,150 per month. The entire amount was debited to prepaid rent.
Required:
Prepare an adjusted trial balance.
Answer:
Account Title Debits Credits
Cash 34,900
Accounts receivable 42,600
Supplies 860
Inventory 62,600
Notes receivable 22,600
Interest receivable 1,507
Prepaid rent 1,150
Prepaid insurance 2,150
Office equipment 90,400
Accumulated depreciation 45,200
Accounts payable 33,600
Salaries payable 1,400
Notes payable 52,600
Interest payable 1,578
Deferred sales revenue 3,300
Common stock 78,200
Retained earnings 35,000
Dividends 6,600
Sales revenue 159,000
Interest revenue 1,507
Cost of goods sold 83,000
Salaries expense 21,600
Rent expense 13,450
Depreciation expense 11,300
Interest expense 1,578
Supplies expense 4,340
Insurance expense 6,450
Advertising expense 4,300
Totals 411,385 411,385
Insurance expense
= 8,600 * 9/12 months = $6,450
Prepaid Insurance = 8.600 - 6,450 = $2,150
Supplies expense = 2,400 + (2,800 - 860) = $4,340
Interest expense and Interest payable = 12% * 3/12 * 52,600 = $1,578
Rent = 12,300 + 1,150 = $13,450
Interest revenue = 22,600 + 8% * 10/12 months = $ 1,507
Accumulated depreciation = 33,900 + 11,300 = $45,200
Eileen transfers property worth $200,000, basis of $60,000, to Goldfinch Corporation. In return, she receives 82% of the stock in Goldfinch Corporation worth $180,000, and a ten year note, executed by Goldfinch and made payable to Eileen, worth $20,000. Eileen will recognize no gain on the transfer of:_______.
a. $190,000.
b. 50.
c. $20,000.
d. $10,000.
e. none of these cholces are correct.
Answer:
C. $20,000
Explanation:
Given the data below,
Property transfered = $200,000
Basis = $60,000
Return = 82℅
Fair market value = $180,000
Long term fair market value = $20,000
In the above scenario, we can safely say that Eileen realized gain of $140,000 on the transfer of property, which is due to;
Property worth $200,000 - basis $60,000 = $140,000.
However, because recognized gain cannot exceed the lesser of realized gain ($140,000) or the boot received ($20,000), the recognized gain is therefore $20,000
Trial Balance September 30, 2022
Debit Credit
Cash $23,640
Accounts Receivable 7,040
Supplies 4,270
Equipment 10,170
Accounts Payable $9,240
Unearned Service Revenue 3,270
Common Stock 19,440
Retained Earnings 13,170
$45,120 $45,120
The October transactions were as follows.
Oct. 5 Received $1,310 in cash from customers for accounts receivable due.
10 Billed customers for services performed $5,410.
15 Paid employee salaries $1,110.
17 Performed $580 of services in exchange for cash.
20 Paid $1,830 to creditors for accounts payable due.
29 Paid a $250 cash dividend. 31 Paid utilities $420.
Required:
Prepare a general ledger using T-accounts.
Answer:
T- accounts:
Cash
Date Account Title Debit Credit
Oct. 1 Balance $23,640
Oct. 5 Accounts receivable 1,310
Oct. 15 Salaries $1,110
Oct. 17 Service Revenue 580
Oct. 20 Accounts Payable 1,830
Oct. 29 Dividend 250
Oct. 31 Utilities 420
Accounts Receivable
Date Account Title Debit Credit
Oct. 1 Balance $7,040
Oct. 5 Cash $1,310
Oct. 10 Service Revenue 5,410
Supplies
Date Account Title Debit Credit
Oct. 1 Balance $4,270
Equipment
Date Account Title Debit Credit
Oct. 1 Balance $10,170
Accounts Payable
Date Account Title Debit Credit
Oct. 1 Balance $9,240
Oct. 20 Cash 1,830
Unearned Service Revenue
Date Account Title Debit Credit
Oct. 1 Balance $3,270
Common Stock
Date Account Title Debit Credit
Oct. 1 Balance $19,440
Retained Earnings
Date Account Title Debit Credit
Oct. 1 Balance $13,170
Service Revenue
Date Account Title Debit Credit
Oct. 10 Accounts receivable $5,410
Oct. 17 Cash 580
Salaries Expense
Date Account Title Debit Credit
Oct. 15 Cash $1,110
Dividend
Date Account Title Debit Credit
Oct. 30 Cash $250
Utilities Expense
Date Account Title Debit Credit
Oct. 30 Cash $420
Explanation:
a) Data and Calculations:
Trial Balance September 30, 2022
Account Title Debit Credit
Cash $23,640
Accounts Receivable 7,040
Supplies 4,270
Equipment 10,170
Accounts Payable $9,240
Unearned Service Revenue 3,270
Common Stock 19,440
Retained Earnings 13,170
$45,120 $45,120
b) Journal Entries:
Oct. 5:
Debit Cash $1,310
Credit Accounts Receivable $1,310
To record cash receipts from customers.
Oct. 10:
Debit Accounts Receivable $5,410
Credit Service Revenue $5,410
To record service revenue.
Oct. 15:
Debit Salaries Expense $1,110
Credit Cash Account $1,110
To record payment of salaries.
Oct. 17:
Debit Cash Account $580
Credit Service Revenue $580
To record performance of services for cash.
Oct. 20:
Debit Accounts Payable $1,830
Credit Cash Account $1,830
To record the payment of cash on account
Oct. 29:
Debit Dividend $250
Credit Cash Account $250
To record the payment of cash dividend.
Oct. 31:
Debit Utilities $420
Credit Cash Account $420
To record the payment for Utilities.
The Tax Cuts and Jobs Act of 2017 temporarily allows 100% bonus depreciation (effectively expensing capital expenditures). However, we will still include depreciation forecasting in this chapter and in these problems in anticipation of the return of standard depreciation practices during your career. a. Costs except depreciation The forecasted costs except depreciation will be
Answer and Explanation:
Stockholders' equity next year = current stockholders equity + forecasted dividend
Given that sales is forecasted to grow by 8% next year and 50% is paid out
Given that current stockholders' equity =$22.2(millions)
Forecasted sales next year= $185.8(sale this year) * 1.08= $200.944 million
Forecasted net income = $200.644*0.009688= $1.9438
Given 50% of net income = $1.9438*0.5= $0.9719
Forecasted stockholders equity= $22.2+$0.9719= $23.171
George runs a small retail business. He sells brands that another business manufactures. George’s retail store uses the logos and trademarks of that business to attract customers. George thus acts as a dealer on behalf of the manufacturing business. Which type of franchise model does George’s retail business follow? A. trademark franchise B. product distribution franchise C. manufacturing franchise D. management franchise E. business format franchise
Answer:
trademark franchise
Answer:
business format franchise
Explanation:
Duke Company's records show the following account balances at December 31, 2021:
Sales revenue $15,800,000
Cost of goods sold 9,400,000
General and administrative expense 1,040,000
Selling expense 540,000
Interest expense 740,000
Income tax expense has not yet been determined. The following events also occurred during 2018. All transactions are material in amount.
a. $480,000 in restructuring costs were incurred in connection with plant closings.
b. Inventory costing $580,000 was written off as obsolete. Material losses of this type are considered to be unusual.
c. It was discovered that depreciation expense for 2017 was understated by $68,000 due to a mathematical error.
d. The company experienced a negative foreign currency translation adjustment of $380,000 and had unrealized gains on investments of $360,000.
Required:
Prepare a single, continuous multiple-step statement of comprehensive income for 2021. The company's effective tax rate on all items affecting comprehensive income is 25%. Each component of other comprehensive income should be displayed net of tax. Ignore EPS disclosures. (Amounts to be deducted should be indicated with a minus sign.)
Answer:
Total comprehensive income = $2,250,000
Explanation:
Note: See the attached excel file for the single, continuous multiple-step statement of comprehensive income for 2021.
Multiple-step income statement is an income statement that employs multiple subtractions in the process of calculating the net income. Multiple-step income statement shows the gross profit and separates the operating revenues and expenses from the nonoperating revenues, expenses, gains, and losses.
Use EMBG's adjusted trial balance to prepare entries to close EMBG's temporary accounts (using Retained Earnings), in journal entry form.
EMBG CORPORATION
Adjusted Trial Balance
For the Year Ending December 31, 2016
Debit Credit
Cash $44,000
Accounts receivable 28,000
Equipment 376,000
Accumulated depreciation $72,000
Notes payable 60,000
Common stock 130,000
Retained earnings 62,000
Service fees earned 326,000
Rent expense 44,000
Salaries expense 116,000
Depreciation expense 42,000
Totals $650,000 $650,000
Answer and Explanation:
The Preparation of entries to close EMBG's temporary accounts (using Retained Earnings), in the journal entry form is shown below:-
Service fees earned Dr, $326,000
To Income summary $326,000
(Being closing of service revenue is recorded)
Income summary Dr, $202,000
To Rent expense $44,000
To Salaries expense $116,000
To Depreciation expense $42,000
(Being closing of expenses is recorded)
Income summary Dr, $124,000 ($326,000 - $202,000)
To Retained earnings $124,000
(Being income is recorded)
Suppose you are the information technology (IT) manager for an IT company. You receive a report that contains a list of computer equipment stored in the company warehouse. You notice that the list also includes items that you know are not stored in the warehouse. Would you consider this list as good information? Why, or why not? Give some examples of at least three items on this list that you consider to be good information and at least three items on this list that would not be good information. Explain your reasoning, and include a discussion about why good information is important in management information systems (MIS).
Answer:
The summary including its query given is mentioned beneath.
Explanation:
The collection includes products which are housed throughout the warehouse, and even some products which have not been housed in the warehouse. Given that perhaps the document appears expected to contain a collection of stock in the warehouse, I would assume that even this documentation isn't really pleasant. That's because each list would rank very poorly whenever it comes to data accuracy.
Most of the other things which could be regarded strong data mostly on list seem to be:
Collection of products that would be in the warehouse throughout fact. The list becomes more certainly exhaustive as well as coincides with the intent of preparation. The number of objects would surpass the confidence interval which, in comparative purposes, have a buffer.The list still has pitfalls, and many of the things that would be deemed poor knowledge have become:
Name and sometimes acknowledgement of products that weren't in the warehouse through fact. Wrong estimate including its variety of products. Details should never be used for this same real-time estimation of storage facility-related data.In MIS, accurate knowledge is crucial because MIS offers an interlinked mechanism amongst servers and applications that lets organizations making informed decisions, support processes, and the organization structure of support. If the evidence is not strong, so inaccurate decisions based through mistaken conclusions will interfere throughout the decision-making process. As a consequence, performance, effect and potential loss of sales may be lost.
Larned Corporation recorded the following transactions for the just completed month. $78,000 in raw materials were purchased on account. $76,000 in raw materials were used in production. Of this amount, $64,000 was for direct materials and the remainder was for indirect materials. Total labor wages of $121,000 were paid in cash. Of this amount, $103,400 was for direct labor and the remainder was for indirect labor. Depreciation of $197,000 was incurred on factory equipment.
Required:
Record the above transactions in journal entries.
Answer and Explanation:
The journal entries are shown below:
1. Raw material inventory A/c Dr.$78,000
To accounts payable $78,000
(To record raw material purchased)
2. Work in process inventory A/c Dr. $64,000
Manufacturing overhead A/c Dr. $12,000
To Raw material inventory Cr. $76,000
(To record the raw material requisitioned is recorded)
3. Work in Process $103,400
Manufacturing overhead $17,600
To Cash $121,000)
(Being the cash paid is recorded)
4. Manufacturing overhead $197,000
To Accumulated Depreciation - equipment $197,000
(Being the depreciation incurred on factory equipment is recorded)
Concrete Consulting Co. has the following accounts in its ledger: Cash; Accounts Receivable; Supplies; Office Equipment; Accounts Payable; Jason Payne, Capital; Jason Payne, Drawing; Fees Earned; Rent Expense; Advertising Expense; Utilities Expense; Miscellaneous Expense.
Oct. 1. Paid rent for the month, $5,100.
3. Paid advertising expense, $3,230.
5. Paid cash for supplies, $1,380.
6. Purchased office equipment on account, $21,200.
10. Received cash from customers on account, $6,920.
15. Paid creditors on account, $2,030.
27. Paid cash for miscellaneous expenses, $880.
30. Paid telephone bill (utility expense) for the month, $320.
31. Fees earned and billed to customers for the month, $46,100.
31. Paid electricity bill (utility expense) for the month, $550.
31. Withdrew cash for personal use, $3,500.
Required:
Journalize the selected transactions for October 2019.
Answer:
Oct.1
Dr Rent Expense $5,100
Cr Cash $5,100
Oct.3
Dr Advertising Expense $3,230
Cr Cash $3,230
Oct.5
Dr Supplies $1,380
Cr Cash $1,380
Oct.6
Dr Office Equipment $21,200
Cr AccountsPayable $21,200
Oct.10
Dr Cash $6,920
Cr Accounts receivable $6,920
Oct.15
Dr Accounts Payable $2,030
Cr Cash $2,030
Oct.27
Dr Miscellaneous Expense $880
Cr Cash $880
Oct.30
Dr Utilities Expense $320
Cr Cash $320
Oct. 31
Dr Accounts Receivable$46,100
Cr Fees Earned $46,100
Oct. 31
Dr Utilities Expense $550
Cr Cash $550
Oct. 31
Dr Drawing $3,500
Cr Cash $3,500
Explanation:
Preparation of Journal entries
Oct.1
Dr Rent Expense $5,100
Cr Cash $5,100
Oct.3
Dr Advertising Expense $3,230
Cr Cash $3,230
Oct.5
Dr Supplies $1,380
Cr Cash $1,380
Oct.6
Dr Office Equipment $21,200
Cr AccountsPayable $21,200
Oct.10
Dr Cash $6,920
Cr Accounts receivable $6,920
Oct.15
Dr Accounts Payable $2,030
Cr Cash $2,030
Oct.27
Dr Miscellaneous Expense $880
Cr Cash $880
Oct.30
Dr Utilities Expense $320
Cr Cash $320
Oct. 31
Dr Accounts Receivable$46,100
Cr Fees Earned $46,100
Oct. 31
Dr Utilities Expense $550
Cr Cash $550
Oct. 31
Dr Drawing $3,500
Cr Cash $3,500
As energy costs continue to rise, power efficiency is increasingly important. Acme Chemical is evaluating 2 different electric motors to drive a mixing motor and needs to perform a present economy study. The motor will produce 75 hp and will be operated 8 hours per day, 365 days for one year (maintenance will be performed on second shift—assume no down time during operation), after which time the motor will have no value. Select the most economical motor. Assume Acme’ s electric power costs $0.16 per kWh. (1 hp = 0.746 kW).
Motor A Motor B
Purchase price $3,200 $5,900
Annual maintenance cost $250 $450
Efficiency 75% 85%
Answer:
The answer is below
Explanation:
For motor A, efficiency = 75%= 0.75 hence:
[tex]Operating\ cost\ of\ motor\ A=\frac{75\ hp}{0.75} *\frac{0.746\ kW}{hp}*\frac{\$0.16}{kWh} *\frac{8\ hr}{day}*\frac{365\ days}{year} \\\\Operating\ cost\ of\ motor\ A=\$34853[/tex]
Total cost for motor A = operating cost + purchase cost = $34853 + $3200
Total cost for motor A = $38053
For motor B, efficiency = 85% = 0.85
[tex]Operating\ cost\ of\ motor\ B=\frac{75\ hp}{0.85} *\frac{0.746\ kW}{hp}*\frac{\$0.16}{kWh} *\frac{8\ hr}{day}*\frac{365\ days}{year} \\\\Operating\ cost\ of\ motor\ B=\$30753[/tex]
Total cost for motor B = operating cost + purchase cost = $30753 + $5900
Total cost for motor B = $36653
Therefore motor B is more economical since it has a lesser total cost
The bookkeeper for Wildhorse Co. asks you to record the following accrual adjustments at December 31 in the tabular summary that follows. (If a transaction results in a decrease in Assets, Liabilities or Stockholders' Equity, place a negative sign (or parentheses) in front of the amount entered for the particular Asset, Liability or Equity item that was reduced.)
(a) Interest on notes payable of $350 is accrued.
(b) Services performed but unbilled totals $1,850.
(c) Salaries of $700 earned by employees have not been recorded.
Assets Liabilities Stockholders' Equity Accounts_ Interest Payable +Payable Sal./Wages ^ Com Stock Adjustment Receivable + Rev. Exp Div
Answer:
The attached file has the answer required.
Interest on notes payable will be a liability as it is accrued. It will still be accounted from the expenses however.
Services is a revenue stream that was not recorded so it will go to Accounts Receivable and Revenue.
Salaries unpaid will become a liability and an expense in the income statement.
Suppose 60 students are candidates for four scholarships – one for $500, one for $750, one for $1000 and the fourth for $1200:
a)How many way can four students get selected from the 60 candidates?
b)If you, your brother, and two sisters are four of the 60 candidates, what is the probability all four of you will get the four scholarships?
Answer:
yes
Explanation:
Prepare financial statements from an adjusted trial balance (LO3-5) [The following information applies to the questions displayed below.]
The December 31, 2021, adjusted trial balance for Fightin' Blue Hens Corporation is presented below.
Accounts Debit Credit
Cash $ 11,200
Accounts Receivable 142,000
Prepaid Rent 5,200
Supplies 26,000
Equipment 320,000
Accumulated Depreciation $ 127,000
Accounts Payable 11,200
Salaries Payable 10,200
Interest Payable 4,200
Notes Payable (due in two years) 32,000
Common Stock 220,000
Retained Earnings 52,000
Service Revenue 420,000
Salaries Expense 320,000
Rent Expense 16,000
Depreciation Expense 32,000
Interest Expense 4,200
Totals 847,800 876,600
Required:
Prepare an income statement for the year ended December 31, 2021.
FIGHTIN' BLUE HENS CORPORATION
Income Statement
For the Year Ended December 31, 2021
Expenses:
Total expenses
Answer:
Fightin' Blue Hens Corporation
Income Statement
For the year ended December 31, 2021
Service Revenue $420,000
Operating expenses:
Salaries Expense $320,000 Rent Expense $16,000 Depreciation Expense $32,000 ($368,000)Operating income $52,000
Other revenues and expenses:
Interest Expense $4,200 ($4,200)Net income before taxes $47,800
*The totals of the trial balance sheet were added incorrectly, they both debit and credit total $876,600.