Answer:
Current ratio 3.46
Acid-test ratio 1.71
Explanation:
A. Calculation to determine Current ratio
Using this formula
Current ratio =Current assets/Current liablities
Let plug in the formula
Current ratio=$92 million+$84 million+$172 million+$8 million/$78 million+$25 million
Current ratio=$356 million/$103 milion
Current ratio=3.46
B. Calculation to determine the acid-test ratio
Acid-test ratio=$92 million+$0+$84 million/$78 million+$25 million
Acid-test ratio=$176 million/$103 million
Acid-test ratio=1.71
The following trial balance of Sarasota Traveler Corporation does not balance.
Sarasota Traveler Corporation
Trial Balance
April 30, 2020
Debit Credit
Cash $6,212
Accounts Receivable 5,390
Supplies 3,117
Equipment 6,250
Accounts Payable $7,194
Common Stock 8,150
Retained Earnings 2,150
Service Revenue 5,350
Office Expense 4,470 0
$25,439 $22,844
An examination of the ledger shows these errors.
1. Cash received from a customer on account was recorded (both debit and credit) as $1,730 instead of $2,000.
2. The purchase on account of a computer costing $3,339 was recorded as a debit to Office Expense and a credit to Accounts Payable.
3. Services were performed on account for a client, $2,400, for which Accounts Receivable was debited $2,400 and Service Revenue was credited $375.
4. A payment of $245 for telephone charges was entered as a debit to Office Expense and a debit to Cash.
5. The Service Revenue account was totaled at $5,350 instead of $5,430.
InstructionsFrom this information prepare a corrected trial balance.
Answer:
Sarasota Traveler Corporation
Trial Balance as at April 30, 2020
Debit Credit
Cash $6,212
Accounts Receivable 5,390
Supplies 3,117
Equipment 6,250
Accounts Payable $7,194
Common Stock 8,150
Retained Earnings 2,150
Service Revenue 5,350
Office Expense 4,470 0
Explanation:
First prepare correcting journals. Then adjust the ledger accounts using the journals prepared
Journals
Item 1
Debit : Cash $270
Credit : Accounts Payable $270
Item 2
Debit : Computer $3,339
Credit : Office Expense $3,339
Item 3
Debit : Suspense $2,025
Credit : Service Revenue $2,025
Prepare journal entries to record each of the following four separate issuances of stock. A corporation issued 2,000 shares of $10 par value common stock for $24,000 cash. A corporation issued 1,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $52,000. The stock has a $5 per share stated value. A corporation issued 1,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $52,000. The stock has no stated value. A corporation issued 500 shares of $75 par value preferred stock for $89,500 cash.
Answer:
A. Dr Cash $24,000
Cr common stock $20,000
Cr paid in capital in excess of par-value common stock $4,000
B. Dr organization Expense $52,000
Cr common stock $5,000
Cr paid in capital in excess of par-value common stock $47,000
C. Dr organization expense $52,000
Cr Common Stock $52,000
D. Dr Cash $89,500
Cr Preferred stock $37,500
Cr paid in capital in excess of par-value common stock $52,000
Explanation:
Preparation of the journal entries to record each of the following four separate issuances of stock
A. Dr Cash $24,000
Cr common stock $20,000
(2000*10)
Cr paid in capital in excess of par-value common stock $4,000
($24,000-$20,000)
B. Dr organization Expense $52,000
Cr common stock $5,000
(1,000*$5)
Cr paid in capital in excess of par-value common stock $47,000
($52,000-$5,000)
C. Dr organization expense $52,000
Cr Common Stock $52,000
D. Dr Cash $89,500
Cr Preferred stock $37,500
(500*$75)
Cr paid in capital in excess of par-value common stock $52,000
($89,500-$37,500)
A contract is made between two parties. The terms of the contract are complete and unambiguous. A dispute arises between the Parties. Party A wants to pull out of the contract without penalty. Party B argues that Party A’s proposed action is prohibited by the express terms of the contract. Party A argues that the Parties verbally agreed to ignore that provision of the contract that would impose a penalty on Party A. Which Party will prevail and why?
Answer: Party B
Explanation:
Even though verbal agreements are enforceable by law, written agreements take precedent because they are more explicit than verbal agreements.
The written agreement will therefore be followed in this case and according to this agreement, A will be punished for the proposed action.
If A had tangible proof that a subsequent agreement was reached that would void them of said punishment, they should present it. If they do not, B would prevail.
Financial information is presented below: Operating expense s $ 45,000 Sales returns and allowance s 3,000 Sales discount s 7,000 Sales revenu e 160,000 Remaining Time: 2 hours, 04 minutes, 55 seconds. Cost of goods sol d 96,000 Question Completion Status: The pro t margin would be
Answer:
See below
Explanation:
Sales revenue
$160,000
Sales discount
($7,000)
Sales return and allowance
($3,000)
Net sales
$150,000
Cost of goods sold
($96,000)
Gross income
$54,000
Operating expenses
($45,000)
Net income/ operating income
$9,000
Profit margin = (9,000/160,000) × 100
Profit margin = 56.25%
Bing Book Bindery has identified two activity cost pools: printing, with an activity driver of batches processed, and binding, with an activity driver of direct labor hours. For the coming quarter, total factory overhead of $140,000 is split such that 65% is allocated to printing and 35% is allocated to binding. Bing makes two types of books: hard cover and soft cover. During the quarter, it expects to produce 5,200 hard cover books and 12,000 soft cover books. Hard covers are produced in batch sizes of 100 and soft covers are produced in batch sizes of 300. A hard cover book requires 0.75 hours of direct labor, while a soft cover book requires 0.25 hours. What is the overhead allocation to soft covers for printing
Answer:
Bing Book Bindery
The overhead allocation to soft covers for printing is:
= $68,250.
Explanation:
a) Data and Calculations:
Activity Cost Pools Overhead Activity Driver Number Overhead
Cost Usage Rates
Printing $91,000 Batches processed 400 $227.50
Binding $49,000 Direct labor hours 150 $326.67
Total $140,000
Overhead rates:
Printing = $227.50 ($91,000/400)
Binding = $326.67 ($49,000/150)
Hard Cover Soft Cover Total
Units produced 5,200 12,000 17,200
Batches 100 300 400
Direct labor hours 0.75 0.25
Total direct labor hours 75 (0.75*100) 75 (0.25*300) 150
Overhead allocated to Soft Cover:
Printing = ($227.50 * 300) $68,250
Binding = ($326.67 * 75) 24,500
Total overhead = $92,750
Overhead allocated to Harc Cover:
Printing = ($227.50 * 100) $22,750
Binding = ($326.67 * 75) 24,500
Total overhead = $47,250
Umatilla Bank and Trust is considering giving Sandhill Co. a loan. Before doing so, it decides that further discussions with Sandhills accounting may be desirable. One area of particular concern is the Inventory account, which has a year-end balance of $269,380. Discussions with the accountant reveal the following.
1. Sandhill shipped goods costing $55,680 to Hemlock Company FOB shipping point on December 28. The goods are not expected to reach Hemlock until January 12. The goods were not included in the physical inventory because they were not in the warehouse.
2. The physical count of the inventory did not include goods costing $100,770 that were shipped to Sandhill FOB destination on December 27 and were still in transit at year-end.
3. Sandhill received goods costing $24,220 on January 2. The goods were shipped FOB shipping point on December 26 by Yanice Co. The goods were not included in the physical count.
4. Sandhill shipped goods costing $53,270 to Ehler of Canada FOB destination on December 30. The goods were received in Canada on January 8. They were not included in Sandhill physical inventory.
5. Sandhill received goods costing $40,510 on January 2 that were shipped FOB destination on December 29. The shipment was a rush order that was supposed to arrive December 31. This purchase was included in the ending inventory of $269,380.
Determine the correct inventory amount on December 31.
Answer:
$306,360
Explanation:
Calculation to Determine the correct inventory amount on December 31.
Correct inventory amount on December 31=$269,380+$24,220+$53,270-$40,510
Correct inventory amount on December 31=$306,360
Therefore the Correct inventory amount on December 31 is $306,360
Refer to the table above. Which of the following scenarios is consistent with this statement? "The rate of inflation was 23.75 percent for 2011." A. The price of a hot dog was $2.44 rather than $3.30 in 2010, with other prices in the table remaining fixed. B. The price of a hot dog was $4.22 rather than $3.63 in 2011, with other prices in the table remaining fixed. C. The price of a hamburger was $3.80 rather than $5.50 in 2010, with other prices in the table remaining fixed. D. The price of a hamburger was $6.60 rather than $5.61 in 2011, with other prices in the table remaining fixed
Answer:
C. The price of a hamburger was $3.80 rather than $5.50 in 2010, with other prices in the table remaining fixed.
Explanation:
The given table shows the inflation rates and price movement over the years. The hamburger had inflation effect and its price increased by almost $1. The price change will create burden on the consumer and they will have to pay for inflation differential.
Select the correct answer.
In general, how long does it take to accomplish a long-term goal?
OA.
a few days to a week
OB.
a few weeks to a month
OC.
a few months to a year
OD.
more than a year
Longview Manufacturing Company manufactures two products (I and II). The overhead costs ($60,500) have been divided into three cost pools that use the following activity drivers:
Number of Labor
Product Number of Orders Transactions Labor Hours
I 15 50 500
II 10 150 2,000
Cost per pool $12,500 $8,000 $40,000
If the number of labor hours is used to assign labor costs from the cost pool, determine the amount of overhead cost to be assigned to Product I.
a. $8,000.
b. $58,000.
c. $9,600.
d. $32,000.
Answer:
a. $8,000.
Explanation:
The computation of the amount of overhead cost assigned to the product I is shown below:
= $40,000 ÷ 2,500 × $500
= $8,000
Hence, the amount of overhead cost assigned to the product I is $8,000
Therefore the correct option is a.
Novak Corporation purchased 380 shares of Sherman Inc. common stock for $12,900 (Novak does not have significant influence). During the year, Sherman paid a cash dividend of $3.25 per share. At year-end, Sherman stock was selling for $37.50 per share. Prepare Novak's journal entries to record (a) the purchase of the investment, (b) the dividends received, and (c) the fair value adjustment. (Assume a zero balance in the Fair Value Adjustment account.)
Answer:
A. Dr Equity Investments (Trading)$12,900
Cr Cash $12,900
B. Dr Cash $1,235
Cr Dividend Revenue $1,235
C. Dr Fair Value Adjustment (Trading) $1,350
Cr Unrealized Holding Gain or Loss-Income $1,350
Explanation:
A. Preparation of Novak's journal entries to record the purchase of the investment
Dr Equity Investments (Trading)$12,900
Cr Cash $12,900
B. Preparation of Novak's journal entries to record the dividends received
Dr Cash $1,235
($3.25 per share*380)
Cr Dividend Revenue $1,235
C. Preparation of Novak's journal entries to record the fair value adjustment
Dr Fair Value Adjustment (Trading) $1,350
Cr Unrealized Holding Gain or Loss-Income $1,350
[($37.50 per share*380)-$12,900]
In supply and demand theory, an increase in consumer income for a normal good will: A. Shift the demand curve in and to the left, lowering the equilibrium price but raising the equilibrium quantity. B. Shift the demand curve out and to the right, raising the equilibrium price and quantity. C. Shift the supply curve out and to the right, lowering the equilibrium price but raising the equilibrium quantity. D. Shift the supply curve in and to the left, lowering the equilibrium price and quantity. E. Shift the demand curve out and to the right, lowering the equilibrium price but raising the equilibrium quantity.
Answer:
b
Explanation:
Normal goods are goods that are goods whose demand increases when income increases and falls when income falls
If income increases, demand increases. the demand curve shifts to the right. This leads to an increase in equilibrium price and quantity
Use the following information (in random order) from a merchandising company and from a service company. McNeil Merchandising Company Accumulated depreciation $ 700 Beginning inventory 11,500 Ending inventory 6,900 Expenses 2,100 Net purchases 14,300 Net sales 22,500 Krug Service Company Expenses $ 8,700 Revenues 27,000 Cash 700 Prepaid rent 680 Accounts payable 200 Equipment 2,500 a. Compute the goods available for sale, the cost of goods sold and gross profit for the merchandiser. Hint: Not all information may be necessary. b. Compute net income for each company.
Answer and Explanation:
a. The computation of the goods available for sale, the cost of goods sold and gross profit for the merchandiser is shown below:
Goods available for sale
Beginning inventory $11,500
Add:Net purchases $14,300
Goods available for sale $25,800
Cost of goods sold
Goods available for sale $25,800
less: Ending inventory -$6,900
Cost of goods sold $18,900
Gross profit
net sales $22,500
less:cost of goods sold -$18,900
Gross profit $3,600
b. The net income for each company is shown below:
Net income for Krug Service company
Revenues $27,000
less: Expenses -$8,700
Net income for Krug Service company $18,300
Net income for Kliener Merchandising Co
Gross profit $3,600
less:Expenses -$2,100
Net income for Kliener Merchandising Co $1,500
Two years ago, Kimberly became a 30 percent partner in the KST Partnership with a contribution of investment land with a $12,750 basis and a $19,850 fair market value. On January 2 of this year, Kimberly has a $18,300 basis in her partnership interest, and none of her pre-contribution gain has been recognized. On January 2 Kimberly receives an operating distribution of a tract of land (not the contributed land) with a $15,575 basis and an $22,675 fair market value.
a. What is the amount and character of Kimberly's recognized gain or loss on the distribution?
b. What is Kimberly’s remaining basis in KST after the distribution?
c. What is KST's basis in the land Kimberly contributed after Kimberly recevies the distribution?
Answer:
a. What is the amount and character of Kimberly's recognized gain or loss on the distribution?
Kimberly's capital gain = land's FMV - other land's FMV = $22,675 - $19,850 = $2,825
b. What is Kimberly’s remaining basis in KST after the distribution?
Kimberly's basis = basis + gain - land basis = $18,300 + $2,825 - $15,575 = $5,550
c. What is KST's basis in the land Kimberly contributed after Kimberly receives the distribution?
KST's basis on the land = land's basis + Kimberly's gain = $12,750 + $2,825 = $15,575
ABC Christmas shop signs a three-month note payable to help finance increases in inventory for the Christmas shopping season. The note is signed on October 1 in the amount of $20,000 with annual interest of 6%. What is the adjusting entry to be made on December 31 for the interest expense accrued to that date, if no entries have been made previously for the interest
Answer: See explanation
Explanation:
To know the the adjusting entry to be made on December 31 for the interest expense accrued to that date, we have to calculate the interest expense for the three months and this will be:
= $20000 × 6% × 3/12
= $20000 × 0.06 × 0.25
= $300
Therefore, the adjusting entry to be made on December 31 for the interest expense accrued to that date will be:
Debit: Interest expenses $300
Credit: Interest Payable $300
Galvanized Products is considering purchasing a new computer system for their enterprise data management system. The vendor has quoted a purchase price of $130,000. Galvanized Products is planning to borrow 1/4th of the purchase price from a bank at 12.00 % compounded annually. The loan is to be repaid using equal annual payments over a 3-year period. The computer system is expected to last 5 years and has a salvage value of $5,200 at that time. Over the 5-year period, Galvanized Products expects to pay a technician $20,000 per year to maintain the system but will save $51,000 per year through increased efficiencies. Galvanized Products uses a MARR of 20.00 %/year to evaluate investments.
What is the present worth of this investment?
Answer:
The present worth of this investment = -$31,204.78
Explanation:
Note: See the attached excel file for the calculation of the present worth of this investment (in bold red color).
In the attached excel file, the following are used:
Loan from bank = Purchase price * (1 / 4) = $130,000 * (1 / 4) = $32,500
Initial cost = Purchase price - Loan from bank = $130,000 - $32,500 = $97,500
The annual required equal loan payments is calculated using the formula for calculating loan amortization as follows:
P = (A * (r * (1 + r)^n)) / (((1 + r)^n) - 1) .................................... (1)
Where,
P = Annual required equal loan payment = ?
A = Loan amount from bank = $32,500
r = interest rate = 12%, or 0.12
n = number of payment years = 3
Substituting all the figures into equation (1), we have:
P = Annual required equal loan payment = ($32,500 * (0.12 * (1 + 0.12)^3)) / (((1 + 0.12)^3) - 1) = $13,531.34
From the attached excl file, the present worth of this investment is equal to -$31,204.78
Presented below is information for Kingbird Company.
1. Beginning-of-the-year Accounts Receivable balance was $16,600.
2. Net sales (all on account) for the year were $102,400. Kingbird does not offer cash discounts.
3. Collections on accounts receivable during the year were $90,000.
a. Prepare (summary) journal entries to record the items noted above. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) No. Account Titles and Explanation Debit Credit 1. 2. 3. SHOW LIST OF ACCOUNTS
b. Compute Kingbird's accounts receivable turnover and days to collect receivables for the year. The company does not believe it will have any bad debts. (Round answers to 2 decimal places, e.g. 4.57.) Accounts receivable turnover times Days to collect accounts receivable days Use the results to analyze Kingbird's liquidity. The turnover ratio last year was 8.1. This is a trend in liquidity.
Answer:
Kingbird Company
a) Journal Entries:
1. No journal required
2. Debit Accounts Receivable $102,400
Credit Sales Revenue $102,400
To record sales on account.
3. Debit Cash $90,000
Credit Accounts Receivable $90,000
To record the collections on account.
b) Accounts receivable turnover and days:
Accounts receivable turnover = Sales/Average Receivable
= $102,400/22,800
= 4.49
Accounts receivable days = 365/4.49 = 81.29 days
c) The accounts receivable turnover ratio for the current year is 4.49. This is better than last year's 8.1. The current year's ratio shows that liquidity had been improved.
Explanation:
a) Data and Calculations:
Accounts Receivable:
Beginning balance $16,600
Net sales 102,400
Cash collections (90,000)
Ending balance $29,000
Average receivable = ($16,600 + $29,000)/2 = $22,800
Isaac Inc. began operations in January 2021. For some property sales, Isaac recognizes income in the period of sale for financial reporting purposes. However, for income tax purposes, Isaac recognizes income when it collects cash from the buyer's installment payments. In 2021, Isaac had $621 million in sales of this type. Scheduled collections for these sales are as follows:
2021 $61 million
2022 121 million
2023 131 million
2024 152 million
2025 156 million
$621 million
Assume that Isaac has a 25% income tax rate and that there were no other differences in income for financial statement and tax purposes. Ignoring operating expenses and additional sales in 2022, what deferred tax liability would Isaac report in its year-end 2022 balance sheet?
a. $128 million.
b. $59 million.
c. $104 milion.
d. $8 million.
Answer:
$109,750,000
Explanation:
Note: Options provided in the question belong to similar question but different numbers
Deferred Tax liability = (Revenue from specific sales in 2021 - Cash received against it up to 2022) * Tax rate
Deferred Tax liability = ($621 million - $61 million - $121 million) * 25%
Deferred Tax liability = $439 million * 25%
Deferred Tax liability = $109,750,000
[The following information applies to the questions displayed below.] Campus Stop, Inc., is a student co-op. Campus Stop uses a perpetual inventory system. The following transactions (summarized) have been selected for analysis: a. Sold merchandise for cash (cost of merchandise $152,070). $ 275,000 b. Received merchandise returned by customers as unsatisfactory (but in perfect condition) for cash refund (original cost of merchandise $800). 1,600 c. Sold merchandise (costing $9,000) to a customer on account with terms n/30. 20,000 d. Collected half of the balance owed by the customer in (c). 10,000 e. Granted a partial allowance relating to credit sales the customer in (c) had not yet paid. 1,800 Compute the gross profit percentage. (Round your answer to 1 decimal place.)
Answer: 45%
Explanation:
First calculate the sales:
= Cash sales + credit sale
= 275,000 + 20,000
= $295,000
Terms on credit sale was 2/10 n/30 and they paid half in time($10,000) but a partial allowance of $1,800 was granted:
Net sales would be:
= Sales - sales returns - sales discount
= 295,000 - 1,600 - (10,000 * 2%) - 1,800
= $291,400
COGS = 152,070 + 9,000 - 800
= $160,270
Gross profit percentage = (Sales - Cost of goods sold) / Sales
= (291,400 - 160,270) / 291,400 * 100%
= 45%
A sole proprietor in the 37% tax bracket pays her 16-year-old son a reasonable salary of $14,000 for services performed for the proprietorship. Compute the family's income tax savings if the son has no other income and takes a $12,400 standard deduction.
Answer: $5020
Explanation:
The family's income tax savings if the son has no other income and takes a $12,400 standard deduction will be calculated as:
Explanation:
Tax savings from deduction = ($14,000 × 37%) = $5180
Less: Tax on child's taxable income = 10% × ($14,000 - $12,400) = 10% × $1600 = $160
Family's income tax savings = $5180 - $160 = $5020
Florissa's Flowers jointly produces three varieties of flowers in the same garden: tulips, lilies, and daisies. The flowers are all watered via the same irrigation system and all receive the same amount of water; daisies require three times as much as lilies, and the water required for tulips is about halfway between the amounts needed for daisies and lilies. Although the lilies and tulips receive more water than they need due to the joint irrigation process, they are not hurt by the overwatering. The joint production cost of the three varieties of flowers is about $30 per harvest. Every harvest yields 10 tulips, 20 lilies, and 20 daisies
Allocate the joint costs of production to each product using the physical units method.
Joint Product Flowers per Harvest Proportion Joint Costs Allocation
Tulip % $ $
Lily %
Daisy %
Totals $
Which products receive the largest portion of the joint costs?
Answer:
Lily and Daisy
Explanation:
Joint product Flowers per harvest Proportion Joint cost allocation
Tulip 10 20% (10/50) $6 ($30*20%)
Lily 20 40% (20/50) $12 ($30*40%)
Daisy 20 40% (20/50) $12 ($30*40%)
Totals 50 100% $30
As per above results, both Lily and Daisy received the largest proportion of joint cost.
Which of the following is an accurate statement about the consequence of nonbinding price ceiling?
a. They prevent the seller from receiving the equilibrium price.
b. They require the seller to advertise the product at the equilibrium price.
c. They create a surplus in the legal market.
d. They do not change the quantity of goods bought or sold in the legal market.
e. They increase the quantity demanded of the good in question.
Answer:
d. They do not change the quantity of goods bought or sold in the legal market.
Explanation:
A price refers to the amount of money a customer or consumer buying goods and services are willing to pay for the goods and services being offered. The price of goods and services are primarily being set by the seller or service provider.
Price control can be defined as standard restrictions or regulatory conditions that are typically set and enforced by the government of a country.
This ultimately implies that, price controls are used to impose the minimum and maximum prices set by the government, which are to be charged for various goods and services in the market. This minimum price that can be charged such as minimum wage is known as price floor while the maximum price that can be charged such as rent control is known as price ceiling.
A nonbinding price ceiling can be defined as a price that do not have any effect on the price of goods or services in the market.
Hence, an accurate statement about the consequence of nonbinding price ceiling is that they do not change the quantity of goods bought or sold in the legal market.
Consider two $10,000 face value corporate bonds. Bond A is currently selling for $9,980 and matures in 15 years. The Bond B sells for $9,350 and matures in 3 years. a) Calculate the current yield as a percentage to 2 decimal places for both bonds if both have a coupon rate equal to 5%. Bond A % Bond B % b) Calculate the yield to maturity as a percentage to 2 decimal places for both bonds if both have a coupon rate equal to 5%. Bond A % Bond B % Which current yield is a better approximation of the yield to maturity, A or B
Solution :
Current yield of the Bond if the bonds are selling at a price of $ 9980.
Current yield = annual coupon amount / current selling price
Current yield [tex]$=\frac{10000 \times 5\%}{9980}$[/tex]
[tex]$=\frac{500}{9980}$[/tex]
= 0.0501
= 5.01 %
The current yield of a bond if the bonds are selling at $ 9350
Current yield = annual coupon amount / current selling price
Current yield [tex]$=\frac{10000 \times 5\%}{9350}$[/tex]
[tex]$=\frac{500}{9350}$[/tex]
= 0.0535
= 5.35 %
Purchases of merchandise on account were $300,000. b. The cost of freight to receive the inventory was $10,000. This was paid in cash. c. Debra returned $5,000 of the merchandise due to an ordering error. Debra received a full credit for the return. d. Debra paid the remaining balance for the merchandise. Calculate the dollar amount that Debra will have in inventory at the end of the month. Assume Debra uses the perpetual inventory system and there were no sales.
Answer:
$305,000
Explanation:
Calculation for the dollar amount that Debra will have in inventory at the end of the month
Purchases of merchandise on account were $300,000
Add Cost of freight to receive the inventory was $10,000
Less merchandise returned $5,000
Inventory ending Dollar amount $305,000
($300,000+$10,000-$5,000)
Therefore the dollar amount that Debra will have in inventory at the end of the month is $305,000
he Coase theorem will apply only if the amount of compensation that must be made to the damaged party is small. an individual who is not affected by the externality can negotiate a settlement between the parties imposing the externality and the parties that are harmed by the externality. the courts can be used to determine the amount of compensation that must be made to the damaged party. the number of people involved is small.
Answer:
the number of people involved is small.
Explanation:
Coase theorem was developed in 1960 by a British economist and author named Ronald Coase.
Coase theorem states that when the actions of a party (X) negatively affects or harm another party (Y), then party Y should be able to create an incentive for party X to stop or limit the action creating such harm.
Generally, when transaction cost are low, the two parties are able to bargain and reach a mutual agreement in the presence of an externality such as a pollution.
The Coase theorem will apply only if the number of people involved is small, the cost of negotiation is low and there are well defined property rights.
DriveTrain, Inc. instituted a new process in October 2020. During October, 13,800 units were started in Department A. Of the units started, 8,950 were transferred to Department B, and 4,850 remained in Work-in-Process at October 31, 2020. The Work-in-Process at October 31, 2020, was 100% complete as to material costs and 50% complete as to conversion costs. Material costs of $37,260 and conversion costs of $45,500 were charged to Department A in October. What were the total costs transferred to Department B assuming Department A uses weighted-average process costing
Answer:
$59,965
Explanation:
Equivalent Units
Materials = 8,950 x 100 % + 4,850 x 100 % = 13,800 units
Conversion Costs = 8,950 x 100 % + 4,850 x 50 % = 11,375 units
Total Costs
Materials = $37,260
Conversion Costs = $45,500
Cost per Equivalent unit
Materials = $37,260 / 13,800 units = $2.70
Conversion Costs = $45,500/ 11,375 units = $4.00
Total Unit Cost = $2.70 + $4.00 = $6.70
Total costs transferred to Department B
Total costs = 8,950 x $6.70 = $59,965
Therefore, the total costs transferred to Department B is $59,965
A bank currently has $150 million in "hot money" deposits against which it wants to hold an 80 percent reserve and $90 million in vulnerable deposits against which it wants to hold a 30 percent reserve. It also has $45 million in stable deposits against which it wants to hold a 5 percent reserve. Legal reserves for the bank are 5 percent of all deposits. What is the bank's liability liquidity reserve?
Answer:
The right response is "141.7875".
Explanation:
According to the question,
The total reserves held will be:
= [tex]0.8\times 150+0.3\times 90+0.05\times 45[/tex]
= [tex]120+27+2.25[/tex]
= [tex]149.25[/tex]
Deductions will be:
= [tex]5 \ percent \ of \ 149.25[/tex]
= [tex]0.05\times 149.25[/tex]
= [tex]7.4625[/tex]
now,
The bank's liability liquidity reserve will be:
= [tex]Total \ reserves \ held-Deductions[/tex]
= [tex]149.25-7.4625[/tex]
= [tex]141.7875[/tex]
10. The assembly worker reached for an Allen wrench in the workplace, hesitating momentarily while searching for the correct size from the group of Allen wrenches lying there. Finding the correct size, she picked it up and positioned it into the hexagonal socket of a screw that had previously been hand-turned into a threaded hole in the work unit. She then twirled the Allen wrench handle with one continuous finger and wrist motion until the screw had been rotated seven turns. At this point she gripped the Allen wrench handle with her hand and tightened the screw the last quarter turn. Write a list of the therbligs that comprise this motion sequence and label each basic motion with a brief description.
Answer:
Explanation:
The list can be seen below.
Sequ Therblig Therblig Description
ence symbol name
1 TE Transport empty [tex]\text{Reach for the Allen wrench in the workplace}[/tex]
2 St select [tex]\text{ Select the correct size}[/tex]
3 G Grasp [tex]\text {Grasp the Allen wrench}[/tex]
4 TL Transport loaded [tex]\text{Pick up and move Allen wrench toward screw}[/tex]
5 P Position [tex]\text{Position Allen wrench into hexogonal socket}[/tex]
6 RL Release [tex]\text{Release grip on Allen wrench}[/tex]
7 TE Transport Empty [tex]\text{Move wrist and finger in preparation for turning}[/tex]
8 U Use [tex]\text{Twirl Allen wrench with one continuous motion}[/tex]
9 TE Transport empty [tex]\text{Reposition wrist and hand}[/tex]
10 G Grasp [tex]\text{Grip Allen wrench in preparation for tightening}[/tex]
11 U Use [tex]\text{Tighten screw with Allen wrench}[/tex]
Cordova, Inc., reported the following receivables in its December 31, 2020, year-end balance sheet:
Current assets:
Accounts receivable, net of $45,000 in allowance for
uncollectible accounts $ 377,000
Interest receivable 15,000
Notes receivable 350,000
Additional information:
The notes receivable account consists of two notes, a $120,000 note and a $230,000 note. The $120,000 note is dated October 31, 2020, with principal and interest payable on October 31, 2021. The $230,000 note is dated March 31, 2020, with principal and 8% interest payable on March 31, 2021.
During 2021, sales revenue totaled $2,050,000, $1,910,000 cash was collected from customers, and $34,000 in accounts receivable were written off. All sales are made on a credit basis. Bad debt expense is recorded at year-end by adjusting the allowance account to an amount equal to 10% of year-end gross accounts receivable.
Required:
1. In addition to sales revenue, what revenue and expense amounts related to receivables will appear in Cordova’s 2021 income statement?
2. Calculate the receivables turnover ratio for 2021. (Round your answer to 2 decimal places.)
1. Interest revenue
Bad debt expense
2. Accounts receivable turnover ratio
Answer:
Cordova, Inc.
1. Bad Debt Expense account of $41,800 will also appear in Cordova's 2021 income statement.
2. Receivables Turnover ratio = 4.32
Explanation:
a) Data and Calculations:
Partial Balance Sheet of Cordova, Inc.:
Current assets:
Accounts receivable, net of $45,000 in allowance for
uncollectible accounts $ 377,000
Interest receivable 15,000
Notes receivable 350,000
Notes Receivable:
Dated October 31, 2020, payable October 31, 2021 = $120,000
Dated March 31, 2020, payable March 31, 2021 = 230,000 (8%)
Total Notes Receivable = $350,000
Accounts receivable:
Beginning balance $422,000
Sales Revenue = 2,050,000
Cash collections 1,910,000
Bad Debts w/off 34,000
Ending balance = $528,000
Allowance for Uncollectible accounts:
Beginning balance $45,000
Bad debts w/off (34,000)
Bad debts expense 41,800
Ending balance (52,800)
Receivables Turnover ratio = Sales Revenue/Average Receivables
= $2,050,000/$475,000
= 4.32
Average Receivables = ($422,000 + $528,000)/2 = $475,000
Select the correct statement below regarding Manufacturing Overhead: Multiple Choice Manufacturing overhead is always an estimated cost. Manufacturing overhead is a clearing account and is neither shown on the balance sheet or income statement in published financial statements. Manufacturing overhead is an inventory account that is shown on the balance sheet. Manufacturing overhead is an expense account for all factory costs that are neither direct materials or direct labor.
Answer:
D) Expense account for all factory costs, except direct material or labour
Explanation:
Manufacturing Overhead refers to indirect costs, incurred during the process of production. This is charged as cost - to the units produced, during a reporting period. Example : Depreciation of asset, cost of asset is spread to all the useful years (& corresponding period output)
why do we have a graduated income tax?