The income statement of Cullumber Company for the month of July shows net income of $2,490 based on Service Revenue $7,100, Salaries and Wages Expense $2,930, Supplies Expense $920, and Utilities Expense $760. In reviewing the statement, you discover the following:
1. Insurance expired during July of $490 was omitted.
2. Supplies expense includes $340 of supplies that are still on hand at July 31.
3. Depreciation on equipment of $240 was omitted.
4. Accrued but unpaid wages at July 31 of $400 were not included.
5. Service performed but unrecorded totaled $730.
Prepare a correct income statement for July 2017.

Answer and Explanation:

The correct income statement for July 2017 is shown below:-

Cullumber Company

Income Statement

For the month of July

Particulars                                               Amount

Service Revenue                                       $7,830

($7,100 + $730)

Expenses

Salaries and Wages Expense     $6,930

($2,930 + $400)

Supplies Expense                           $580

($920 - $340)

Utilities Expense                              $760

Insurance Expense                          $490

Depreciation Expense                     $240

Total expense                                               $9,000

Net loss                                                         $1,170

Which of the following selections effectively use the "you" view.
A. I’m requesting that all of our valued customers complete the customer satisfaction survey.
B. Thank you for your letter regarding your CRB2 home entertainment center.
C. We know you enjoyed your online shopping experience and will want to tell all your friends about it.
D. You are invited to take advantage of our professional development workshops.

Pun Corporation concluded the fair value of Slender Company was $67,000 and paid that amount to acquire its net assets. Slender reported assets with a book value of $53,000 and fair value of $64,000 and liabilities with a book value and fair value of $21,000 on the date of combination. Pun also paid $14,000 to a search firm for finder’s fees related to the acquisition.

Required:
Prepare the journal entries to be made by Pun to record its investment in Slender and its payment of the finder's fees.

Classifications on Balance SheetThe balance sheet contains the following major sections:Current assetsLong-term investmentsProperty, plant, and equipmentIntangible assetsOther assetsCurrent liabilitiesLong-term liabilitiesContributed capitalRetained earningsAccumulated other comprehensive incomeRequired:The following is a list of accounts. Using the letters A through J, indicate in which section of the balance sheet each of the accounts would be classified. If an account does not belong under one of the sections listed, select "Not under any of the choices" from the classification drop down box. For all accounts, indicate if the account is a contra account or an account that would normally be deducted on the balance sheet by selecting "yes" from the second drop down box, otherwise select "no".Account Classification Contra orDeducted (Yes/No)1. Cash 2. Bonds Payable (due in 8 years) 3. Machinery 4. Deficit 5. Unexpired Insurance 6. Franchise (net) 7. Fund to Retire Preferred Stock 8. Current Portion of Mortgage Payable 9. Accumulated Depreciation 10. Copyrights 11. Investment in Held-to-Maturity Bonds 12. Allowance for Doubtful Accounts 13. Notes Receivable (due in 3 years) 14. Property Taxes Payable 15. Deferred Taxes Payable 16. Additional Paid-in Capital on Preferred Stock 17. Premium on Bonds Payable (due in 8 years) 18. Work in Process 19. Common Stock, $1 par 20. Land 21. Treasury Stock (at cost) 22. Unrealized Increase in Value of Available-for-Sale Securities

At January 1, 2021, Café Med leased restaurant equipment from Crescent Corporation under a nine-year lease agreement. The lease agreement specifies annual payments of $29,000 beginning January 1, 2021, the beginning of the lease, and at each December 31 thereafter through 2028. The equipment was acquired recently by Crescent at a cost of $207,000 (its fair value) and was expected to have a useful life of 12 years with no salvage value at the end of its life. (Because the lease term is only 9 years, the asset does have an expected residual value at the end of the lease term of $94,113.) Crescent seeks a 12% return on its lease investments. By this arrangement, the lease is deemed to be a finance lease. (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. Round your intermediate calculations to the nearest whole dollar amount.)
Required:
1. What will be the effect of the lease on Café Med's earnings for the first year (ignore taxes)? (Enter decreases with negative sign.)
2. What will be the balances in the balance sheet accounts related to the lease at the end of the first year for Café Med (ignore taxes)?

As a practicing engineer, you have been assigned by your company to work in a country where bribery is an almost universal practice, and virtually essential to get government permission for construction permits and other items your company needs to do business. Your direct supervisor explains this to you and asks you to deliver a bribe to a local official. Ethically speaking:______.

A sports nutrition company created an energy drink which they think improves athletic performance. In one study, weightlifters were randomly assigned to drink either this new sports drink or flavored water (with a similar taste). The study found that those drank the sports drink were able to lift more weight than before, while those who drank the flavored water were only able to lift the same weight as before.
Is it valid for the company to claim that the cause of the first group lifting more weight than before is due to them drinking the new sports drink?
A. No, because this is an observational study which does not address causation.
B. No, because this is neither an experimental nor observational study.
C. No, because the stronger athletes were likely to drink the new sports drink whereas the weaker athletes were likely to drink flavored water.
D. Yes, because this is an experimental study.

The YTM on a bond is the interest rate you earn on your investment if interest rates don’t change. If you actually sell the bond before it matures, your realized return is known as the holding period yield (HPY).
Requirement:
1. Suppose that today you buy a bond with an annual coupon rate of 8% for $1,170. The bond has 16 years to maturity. What rate of return do you expect to earn on your investment? Assume a par value of $1,000.
2. Two years from now, the YTM on your bond has declined by 1%, and you decide to sell.
A) What price will your bond sell for?
B) What is the HPY on your investment?

Which of the following is a piece of good advice regarding business emails? a. Do not place anything in an email you would not want the world to see. b. Use capital letters in order to convey importance. c. Do not sign off your emails with a closing like "Thank you"; it just wastes space. Simply send your contact information. d. Make your request at the end of an email.

Harbert, Inc. had a beginning balance of $12,000 in its Accounts Receivable account. The ending balance of Accounts Receivable was $10,500. During the period, Harbert collects $72,000 of its accounts receivable. Harbert incurred $63,000 of cash expenses during the accounting period.
Required
a. Based on the information provided, determine the amount of revenue recognized during the accounting period.
b. Based on the information provided, determine the amount of net income earned during the accounting period.
c. Based on the information provided, determine the amount of cash flow from operating activities.

This activity is important because managers face the difficult task of planning, implementing, and evaluating marketing programs once the firm has decided to compete in the global market. As marketing mangers develop the marketing program, they must balance the cost savings of standardization against the benefits of customization.
The goal of this exercise is to demonstrate your understanding of the different types of product and promotion strategies firms utilize as part of their global marketing programs.
Roll over each company name to read the description of the firm's strategy, then drop it onto the correct product and promotion strategy within the graphic.
1. Shiseido
2. Breathe Right
3. Toyota
4. Maybelline
5. Gasoline Producer
A. Product Extension Strategy
B. Product Adaptation Strategy
C. Product Invention Strategy
D. Communication Adaptation Strategy
E. Dual Adaptation Strategy

Several years ago, Carol Mutter, a cash-basis taxpayer, obtained a mortgage from Weak National Bank to purchase a personal residence. In December 2019, $8,500 of interest was due on the mortgage, but Carol had only $75 in her checking account. On December 31, 2019, she borrowed $8,500 from her sister, Pearl, evidenced by a note, and the proceeds were deposited in her checking account. On the same day, Carol issued a check in the identical amount of $8,500 to Weak Bank for the interest due. Is the interest expense deductible for the 2019 tax year?Prepare (in good form) a research memorandum to the file. (See Chapter 2 for an illustration of the structure of a tax memo.)

George consumes two goods, milk and cookies. He has maximized his utility given his income. Milk costs $2 per gallon and he consumes it to the point where the marginal utility he receives from milk is 4. Cookies cost $4 per bag and the relationship between the marginal utility that George gets from eating a bag of cookies and the number of bags he eats per month is as follows:
Bags of Cookies 1 2 3 4 5 6
Marginal Utility 20 16 12 8 4 0
How many bags of cookies does George buy each month?
a. 1.
b. 2.
c. 3.
d. 4.

How would a businessperson be most likely to use seed capital?
A. To purchase equipment for a business
B. To hire managers for a business
C. To hire workers for a business
D. To research the feasibility of opening a business

Suppose that nominal GDP was $9000000.00 in 2005 in Midland County Texas. In 2015, nominal GDP was $11500000.00 in Midland County Texas. The price level rose 3.00% between 2005 and 2015, and population growth was 3.50%. Calculate the following figures for Midland County Texas between 2005 and 2015. Give all answers to two decimals.

Identify which of the arguments for restricting trade that each of the following rebuttals directs against. Rebuttals The Jobs Argument The National-Security Argument The Infant-Industry Argument The Unfair-Competition Argument The Protection-as-a-Bargaining-Chip Argument (A) The gains of the consumers from buying imports at the low price subsidized by foreign governments would exceed the losses of domestic producers. (B) Companies may exaggerate the degree to which their products are essential to national defense in order to obtain protection from foreign competition at the expense of consumers. (C) The country may be forced into deciding between implementing trade restrictions as threatened, which would make the society as a whole worse off, or backing down on its own threat, which would cause it to lose credibility in foreign affairs. (D) Opening up to free trade may impose hardship on some workers in the short run, but it also creates jobs in industries in which the country has a comparative advantage and enables the country as a whole to enjoy a higher standard of living.

A justification for job training programs is that they improve worker productivity. Suppose that you are asked to evaluate whether more job training makes workers more productive. However, rather than having data on individual workers, you have access to data on manufacturing firms in Ohio. In particular, for each firm, you have information on hours of job training per worker (training) and number of nondefective items produced per worker hour (output).

Required:
a. Carefully state the ceteris paribus experiment underlying this policy question.
b. Does it seem likely that a firm's decision to train its workers will be independent of worker characteristics?
c. Name a factor other than worker characteristics that can affect worker productivity.
d. If you find a positive correlation between output and training, would you have convincingly established that job training makes workers more productive?

The following December 31, 2021, fiscal year-end account balance information is available for the Stone Corporation:Cash and cash equivalents $ 6,200Accounts receivable (net) 32,000Inventory 72,000Property, plant, and equipment (net) 180,000Accounts payable 51,000Salaries payable 23,000Paid-in capital 160,000The only asset not listed is short-term investments. The only liabilities not listed are $42,000 notes payable due in two years and related accrued interest of $1,000 due in four months. The current ratio at year-end is 1.5:1.Required:Determine the following at December 31, 2021:1. Total current assets2. Short-term investments3. Retained earnings

The transactions of Spade Company appear below.

a. Kacy Spade, owner, invested $14,250 cash in the company in exchange for common stock.
b. The company purchased office supplies for $413 cash.
c. The company purchased $7,880 of office equipment on credit.
d. The company received $1,681 cash as fees for services provided to a customer.
e. The company paid $7,880 cash to settle the payable for the office equipment purchased in transaction c.
f. The company billed a customer $3,021 as fees for services provided.
g. The company paid $520 cash for the monthly rent.
h. The company collected $1,269 cash as partial payment for the account receivable created in transaction f.
i. The company paid a $1,000 cash dividend to the owner (sole shareholde).

Required:
Prepare the Trial Balance. Use May 31 as its report date.

Brooks Foundry in Charleston, South Carolina​, uses a predetermined manufacturing overhead rate to allocate overhead to individual jobs based on the machine hours required. At the beginning of the​ year, the company expected to incur the​ following:
Manufacturing overhead costs $650,000
Direct labor cost $1,300,000
Machine hours 81,250
At the end of the year, the company had actually incurred:
Direct labor cost $1,190,000
Depreciation on manufacturing plant and equipment $485,000
Property taxes on plant $21,500
Sales salaries $26,000
Delivery drivers' wages $14,500
Plant janitors' wages $11,000
Machine hours 54,500 hours
Requirements:
1. Compute predetermined manufacturing overhead rate.
2. How much manufacturing overhead was allocated to jobs during the​ year?
3. How much manufacturing overhead was incurred during the​ year? Is manufacturing overhead underallocated or overallocated at the end of the​ year? By how​ much?
4. Were the jobs overcosted or​ undercosted? By how​ much?

19. An investment costs $290,000 and will generate the following cash flows: Year 1 - +$132,000; Year 2 - +$100,000; Year 3 - +$150,000. The required rate of return is 15%. What is the IRR?

Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 50,000 of these balls, with the following results:_______.
Sales (50,000 balls) $ 1,250,000
Variable expenses 750,000
Contribution margin 500,000
Fixed expenses 320,000
Net operating income $ 180,000
Required:
1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year’s sales level.
2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls?
3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $202,000, as last year?
4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a), what selling price per ball must it charge next year to cover the increased labor costs?
5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company’s new CM ratio and new break-even point in balls?
6. Refer to the data in (5) above.
a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $202,000, as last year?
b. Assume the new plant is built and that next year the company manufactures and sells 37,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage.

Two consumers are searching for new hair salons and have very different belief systems and needs that affect the way they search for information. The second step in the consumer decision process, after a consumer recognizes a need, is to search for information about various options that exist to satisfy that need. The length and intensity of the search are based on the degree of perceived risk associated with purchasing the product or service.

Read each statement and match it with the followings.

a. Effortless,
b. Worth the Money,
c. Expensive Service,
d. Salon of Choice
e. Unimportant
f. Tight Budget
g. Could Damage Career
h. All the Same
i. Salon of Convenience
j. Personal Image
Joleen Jones Ginger Petri


1. Performance Risk
2. Financial Risk
3. Psychological Risk
4. Internat vs External
5. Benefits vs Costs

A study conducted by Yahoo! revealed that chocolate is the most popular flavor of ice cream in America. Now, Suppose a severe drought in the Midwest causes dairy farmers to reduce the number of milk-producing cattle in their herds by a third. These dairy farmers supply cream that is used to manufacture chocolate ice cream. Indicate the possible effects on demand, supply, or both, as well as the equilibrium price and quantity of chocolate ice cream.
a. The demand curve for chocolate ice cream
a. does not shift
b. shifts to the left
c. shifts to the right
b. The supply curve for chocolate ice cream
a. shifts to the left
b. does not shift
c. shifts to the right
c. The equilibrium price of chocolate ice cream
a. could increase or dereease.
b. decreases.
c. increases
d. The equilibrum quantity of chocolate ice cream
a. decreases
b. increases.
c. could increase or decrease.

Consider the following three stocks:

Stock A is expected to provide a dividend of $11.20 a share forever.
Stock B is expected to pay a dividend of $6.20 next year. Thereafter, dividend growth is expected to be 6.00% a year forever.
Stock C is expected to pay a dividend of $4.80 next year. Thereafter, dividend growth is expected to be 22.00% a year for five years (i.e., years 2 through 6) and zero thereafter.

Required:
If the market capitalization rate for each stock is 10%, which stock is the most valuable?

Each of the following costs pertains to Bailey Dairy Products​ Company, a dairy processing company. Classify each of the​ company's costs as a period cost or a product cost. Further classify product costs as either direct material​ (DM), direct labor​ (DL), or manufacturing overhead​ (MOH). ​(If the cost is a period​ cost, leave the classification input field​ empty; do not select a​ label.) LOADING...​(Click the icon to view the​ costs.) Cost Period Cost or Product Cost DM, DL or MOH
1. Television advertisements for Bailey’s products Period cost MOH
2. Lubricants used in running bottling machines Product cost MOH
3. Research and development related to elimination of antibiotic residues in milk Period cost MOH
4. Gasoline used to operate refrigerated trucks delivering finished dairy products to grocery stores Period cost MOH
5. Company president’s annual bonus Period cost MOH

Four fundamental factors affect the cost of money: (1) the return that borrowers expect to earn on their investments, (2) the preference of savers to spend their income in the current period rather than delay their consumption until some future period, (3) the risks associated with the investment, and (4) expected inflation.

Consider the following statements that address these factors, and indicate which you think are true.

Statement 1: On average and everything else held constant, it is generally assumed that savers and investors prefer immediate consumption to deferred, or postponed, spending.
Statement 2: Investments providing cash flows that are more likely to equal their expected value are said to exhibit more risk.
Statement 3: The onset of 5% inflation means that your receipt of a $100 interest payment allows you to purchase only $95 worth of goods and services.
Statement 4: The inflation premium used to calculate the nominal interest rate on a five-year security should be equal to the rate of inflation expected in year 5 of the investment.

The true statements are:
a. 1 and 4
b. 2 and 4
c. 1 and 3
d. 2 and 3

Cordell Inc. experienced the following events in Year 1, its first year of operation: Received $59,000 cash from the issue of common stock. Performed services on account for $81,000. Paid a $5,900 cash dividend to the stockholders. Collected $65,000 of the accounts receivable. Paid $59,000 cash for other operating expenses. Performed services for $19,000 cash. Recognized $2,900 of accrued utilities expense at the end of the year.
Required
a. & c. Identify the events that result in revenue or expense recognition and those which affect the statement of cash flows. In the Statement of Cash Flows column, use OA to designate operating activity, FA for financing activity, IA for investing activity and NA to indicate the element is not affected by the event.
b. Based on your response to Requirement a, determine the amount of net income reported on the 2018 income statement.
d. Based on your response to Requirement c, determine the amount of cash flow from operating activities reported on the 2018 statement of cash flows.
e. What is the before- and after-closing balance in the service revenue account?
f. What is the balance of the retained earnings account that appears on the 2018 balance sheet?

Company sells a product for per unit. Variable costs are per​ unit, and fixed costs are per month. The company expects to sell units in . Calculate the contribution margin per​ unit, in​ total, and as a ratio.

The manager of a supermarket meat department finds she has 200 lb of round steak, 800 lb of chuck steak, and 150 lb of pork in stock on Saturday morning. She will use these to make three products: hamburger meat, picnic patties, and meatloaf. The demand for each of these items always exceeds the supermarket supply. Therefore, she will be able to sell off all of however much of her current meat ingredients as she wants to. Hamburger meat must consist of at least 20 percent round steak and at least 50 percent chuck steak by weight. Picnic patties must consist of at least 20 percent pork and at least 50 percent chuck steak by weight. Meatloaf must consist of at least 10 percent round steak, 30 percent pork, and 40 percent chuck. In each product, the remainder is an inexpensive filler, and the supermarket has an unlimited supply of it. The manager wants to know how much of each product she should produce so that the total amount of leftover meat ingredients that need to be carried over can be minimized. Solve this problem using Linear Programming.

a. Production quantity of hamburger meat: ______________
b. Production quantity of picnic patties: _______________
c. Production quantity of meatloaf: ___________________
d. The total quantity of leftover meat: _________________

What are the characteristics of a successful entreprenuer​