Answer:
a.
Raw Materials $180,000 (debit)
Accounts Payable $180,000 (credit)
b.
Work In Process Machining : Direct Materials $73,000 (debit)
Work In Process Machining : Indirect Materials $9,000 (debit)
Work In Process Assembly : Indirect Materials $4,900 (debit)
Raw Materials $86,900 (credit)
c.
Work In Process Machining : Direct Labor $23,000 (debit)
Work In Process Assembly : Direct Labor $47,000 (debit)
Salaries Payable $70,000 (credit)
d.
Work In Process Machining : Depreciation $4,500 (debit)
Work In Process Assembly : Depreciation $7,800 (debit)
Accumulated Depreciation $12,300 (credit)
e.
Work In Process Machining : Overheads $9,700 (debit)
Work In Process Assembly : Overheads $11,300 (debit)
Overheads $21,000 (credit)
f.
Work In Process Assembly Department $14,900 (debit)
Finished Goods Inventory $83,400 (debit)
Work In Process Machining Department $98,300 (credit)
g.
Accounts Receivables $100,000 (debit)
Cost of Goods Sold $68,000 (debit)
Sales Revenue $100,000 (credit)
Finished Goods Inventory $68,000 (credit)
Explanation:
Manufacturing Costs are accumulated in the Work In Process Account.
Finished Goods are Transferred from Work In Process Account to Finished Goods Inventory by Debiting Finished Goods Inventory Account and Crediting Work In Process Account.
Johnson Enterprises uses a computer to handle its sales invoices. Lately, business has been so good that it takes an extra 3 hours per night, plus every third Saturday, to keep up with the volume of sales invoices. Management is considering updating its computer with a faster model that would eliminate all of the overtime processing.
Current Machine New Machine
Original purchase cost $14,900 $25,200
Accumulated depreciation $6,600 _
Estimated annual operating costs $24,600 $19,600
Remaining useful life 5 years 5 years
If sold now, the current machine would have a salvage value of $10,200. If operated for the remainder of its useful life, the current machine would have zero salvage value. The new machine is expected to have zero salvage value after 5 years. Prepare an incremental analysis to determine whether the current machine should be replaced.
Answer:
The old computer should be replaced since the differential amount of the replacing it with a new computer is $10,000
Explanation:
Old machine New machine Differential
amount
purchase cost $0 ($15,000) ($15,000)
operating costs year 1 ($24,600) ($19,600) $5,000
operating costs year 2 ($24,600) ($19,600) $5,000
operating costs year 3 ($24,600) ($19,600) $5,000
operating costs year 4 ($24,600) ($19,600) $5,000
operating costs year 5 ($24,600) ($19,600) $5,000
TOTAL ($123,000) ($113,000) $10,000
Santoyo Corporation keeps careful track of the time required to fill orders. Data concerning a particular order appear below:
Hours
Wait time 12.5
Process time 1.6
Inspection time 0.8
Move time 4.2
Queue time 5.9
The delivery cycle time was:______
Answer:
Santoyo Corporation
Tracking Time to Fill Orders:
The delivery cycle time was 25 hours.
Explanation:
The delivery cycle time sums the time occasioned by the supply delay and the reordering delay before the goods reach the customer. As an order is received by Santoyo Corporation there is usually a wait time of half a day or 12.5 hours. The processing of the order consumes 1.6 hours. Before delivery is made, the inspectors spend 0.8 hours or 48 minutes doing what they know best. Then, freight takes 4.2 hours for the delivery van to reach the customer's warehouse. At that point, another 5.9 hours are spent queueing for the receipt of the goods by the customer.
On January 1, 2017, the first day of its fiscal year, Carter City received notification that a federal grant in the amount of $565,000 was approved. The grant was restricted for the payment of wages to teenagers for summer employment. The terms of the grant permitted reimbursement only after qualified expenditures have been made; the grant could be used over a two-year period. The following data pertain to operations of the SUMMER EMPLOYMENT GRANT FUND, a special revenue fund of Carter City, during the year ended December 31, 2017.
1. The budget was recorded. It provided for Estimated Revenues for the year in the amount of $282,500, and for Appropriations in the amount of $282,500.
2. A temporary loan of $282,500 was received from the General Fund .
3. During the year, teenagers earned and were paid $272,050 under terms of the Summer Employment program. An additional $8,250 is accrued as payable on December 31. Recognize the receivable and revenue (include the $8,250 of wages payable).
4. Each month a properly documented request for reimbursement was sent to the federal government; checks for $276,250 were received.
5. $251,550 was repaid to the General Fund
6. Necessary closing entries were made.
Answer:
1. Dr. Estimated revenue control 282,500
Cr. Appropriations control 282,500
2. Dr. cash 282,500
Cr. Due to general fund 282,500
3. a. Dr. expenditures control 280,300
Cr. Cash 272,050
Cr. Accrued wages payable 8,250
3b. Dr. grants receivable - Federal government 280,300
Cr. Revenues control 280,300
4. Dr. cash 276,250
Cr. Grants receivable -federal gonv 276,250
5. Dr. Due to general fund 251,550
Cr. Cash 251,550
6. Dr. Appropriations control 282,500
Cr. Estimated revenues control 282,500
Dr. Revenues control 380,300
Dr. fund balance 0
Cr. Expenditure control 380,300
Explanation:
Preparation of the Journal entries for Carter City
1. Based on the information given we were told that Estimated Revenues for the year was the amount of $282,500 while the Appropriations was in the amount of $282,500 this means that the transaction will be recorded as:
Dr. Estimated revenue control 282,500
Cr. Appropriations control 282,500
2. Since temporary loan of the amount of $282,500 was received from the General Fund, the Journal entry will be:
Dr. cash 282,500
Cr. Due to general fund 282,500
3.Since the teenagers earned and were paid the amount of $272,050 and An additional of $8,250 was accrued as payable while the Recognize the receivable and revenue include the amount of $8,250 of wages payable, this means that the transaction will be recorded as:
a. Dr. expenditures control 280,300
(272,050+8,250)
Cr. Cash 272,050
Cr. Accrued wages payable 8,250
3b. Dr. grants receivable - federal government 280,300
Cr. Revenues control 280,300
(272,050+8,250)
4. Since checks for the amount of $276,250 were received by the Federal government, this means that the Transaction will be recorded as:
Dr. cash 276,250
Cr. Grants receivable -federal gonv 276,250
5.Since the amount of $251,550 was repaid to the General Fund, the Journal entry will be:
Dr. Due to general fund 251,550
Cr. Cash 251,550
6. Since the Necessary closing entries were made, the transaction will be recorded as:
Dr. Appropriations control 282,500
Cr. Estimated revenues control 282,500
Dr. Revenues control 380,300
Dr. fund balance 0
Cr. Expenditure control 380,300
(272,050+8,250)
Filer Manufacturing has 11.6 million shares of common stock outstanding. The current share price is $59, and the book value per share is $5. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $99 million, has a 8 percent coupon, and sells for 92 percent of par. The second issue has a face value of $81.2 million, has a 8 percent coupon, and sells for 95.5 percent of par. The first issue matures in 10 years, the second in 5 years. What is Filer's capital structure weight of equity on a book value basis? (Do not round your intermediate calculations.) What is Filer's capital structure weight of debt on a book value basis? (Do not round your intermediate calculations.) What is Filer's capital structure weight of equity on a market value basis? (Do not round your intermediate calculations.) What is Filer's capital structure weight of debt on a market value basis?
Answer:
a. Filer's capital structure weight of equity on a book value basis is 24%.
b. Filer's capital structure weight of debt on a book value basis is 76%.
c. Filer's capital structure weight of equity on a market value basis is 80%.
d. Filer's capital structure weight of debt on a market value basis is 20%.
Explanation:
a. What is Filer's capital structure weight of equity on a book value basis? (Do not round your intermediate calculations.)
Equity book value = Equity book value per share * Number of shares = 11,600,000 * $5 = $58,000,000
Debt book value = Debt face value = First bond face value + Second face value = $99,000,000 + $81,200,000 = $180,200,000
Total book value = $58,000,000 + $180,200,000 = $238,200,000
Book value weight of equity = Equity book value / Total book value = $58,000,000 / $238,200,000 = 0.24, or 24%
Therefore, Filer's capital structure weight of equity on a book value basis is 24%.
b. What is Filer's capital structure weight of debt on a book value basis? (Do not round your intermediate calculations.)
From part a, we have:
Debt book value = $180,200,000
Total book value = $238,200,000
Therefore, we have:
Book value weight of debt = Debt book value / Total book value = $180,200,000 / $238,200,000 = 0.76, or 76%
Therefore, Filer's capital structure weight of debt on a book value basis is 76%.
c. What is Filer's capital structure weight of equity on a market value basis? (Do not round your intermediate calculations.)
Equity market value = Current share price * Number of shares = $59 * 11,600,000 = $684,400,000
Debt market value = Bond price quote * Par value of the bond
Debt market value = First bond market value + Second bond market value = (92% * $99,000,000) + (95.5% * $81,200,000) = $168,626,000
Total market value = Equity market value + Debt market value = $684,400,000 + $168,626,000 = $853,026,000
Market value weight of equity = Equity market value / Total market value = $684,400,000 / $853,026,000 = 0.80, or 80%
Therefore, Filer's capital structure weight of equity on a market value basis is 80%.
d. What is Filer's capital structure weight of debt on a market value basis?
From part c, we have:
Debt market value = $168,626,000
Total market value = $853,026,000
Market value weight of debt = Debt market value / Total market value = $168,626,000 / $853,026,000 = 0.20, or 20%.
Therefore, Filer's capital structure weight of debt on a market value basis is 20%.
Suppose that the quantity of apples sold increases by 30 percent after the price of pears increases by 15 percent. What is the coefficient of cross elasticity of demand
Guerilla Radio Broadcasting has a project available with the following cash flows : Year Cash Flow 0 −$13,600 1 5,600 2 6,900 3 6,300 4 4,700 What is the payback period?
Answer:
It will take 3 years and 77 days to recover the initial investment.
Explanation:
Giving the following information:
Year Cash Flow 0 −$13,600 1 5,600 2 6,900 3 6,300 4 4,700
The payback period is the time required to recover the initial investment.
Year 1= 5,600 - 13,600= -8,000
Year 2= 6,900 - 8,000= -1,100
Year 3= 6,300 - 1,100= 5,200
To be more accurate:
(1,100/5,200)*365= 77
It will take 3 years and 77 days to recover the initial investment.
While examining cash receipts information, the accounting department determined the following information: opening cash balance $180, cash on hand $1,350.89, and cash sales per register tape $1,186.34. Prepare the required journal entry based upon the cash count sheet.
Answer:
Cash $1,170.89
Cash Over/Short $15.45
To Sales Revenue $1,186.34
(Beingthe cash is recorded)
Explanation:
Before passing the journal entry first we have to determine the ending cash balance which is shown below:
Ending Cash Balance is
= Opening Cash Balance + Sales
= $180 + $1,186.34
= $1,366.34
Short cash is
= Ending cash balance - cash on hand
= $1,366.34 - $1,350.89
= $15.45
And, the actual cash is
= Cash on hand - opening cash balance
= $1,350.89 - $180
= $1,170.89
Now the journal entry is
Cash $1,170.89
Cash Over/Short $15.45
To Sales Revenue $1,186.34
(Being the cash is recorded)
Which of these statements about corporate bonds is correct?
Answer:
Option A is the right answer.
Explanation:
Bonds seems to be debt security during which the lender is obliged to pay compensation at regular time intervals as well as pay the money back the balance of the shareholder at intellectual ability.
Option B: The raising of new bonds diminishes underlying ownership within the company. Incorrect issuance of new equities diminishes the company's current ownership.Option C: Debenture bonds attached leverage on the assets guaranteed. Incorrect debentures represent short term loans. Option D: Bonds focuses on providing funding for equities. Incorrect since debt funding is provided by Bonds.So that alternative A would be the appropriate choice.
Bonds are like IOUS with a promise to repay the amount borrowed, with interest, on a certain date. Thus, option A is correct.
Bonds appear to be a type of financial instrument where the lender is required to provide periodical payments of compensation as well as to reimburse the shareholder for their remaining amount at the investor's intellectual discretion.
An Iou-like financial obligation is a bond. By purchasing corporate bonds, investors are making a loan to the corporation issuing the connection. Bonds usually provide investors with a fixed rate of interest that is paid over a specified period of time at periodic times. In general, bonds are a less risky investment. Therefore, option A is correct.
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The demand curve is Qd = 1,600 – 50P and the supply curve is Qs = 1,200 + 150P. Calculate the equilibrium quantity. Group of answer choices
Answer:
Equilibrium quantity is 1500
Explanation:
The equilibrium quantity is achieved at a point where the quantity demanded equals quantity supplied.
Qd=Qs
Qd=1,600 – 50P
Qs== 1,200 + 150P
1,600 – 50P=1,200 + 150P
We need to collect like terms
1600-1200=150P+50P
400=200P
P=400/200
P=2
We need substitute 2 for P in any of Qd or Qs
Qs=1200+(150*2)=1500
Sarah, the controller of a large beverage supplier, supervises two employees. Her boss, Vladimir, instructs her to increase the company's inventory balance for an amount that is material to the financial statements by crediting several small "miscellaneous" expense accounts. She does not understand why he wants her to make these entries but immediately directs one of her staff to make them because she has been instructed to do so. Which of the following statements best describes Sarah's actions?
Answer:
Sarah failed to evaluate a potential ethical issue
Explanation:
According to the given scenario, Ethical concerns occur as workers face pressure from their employers to inflate profits or expenditures that include manipulating financial statements. Workers should be morally responsible and not participate in any dishonest behavior that modify the financial statements.
So, the correct answer is Sarah failed to evaluate a potential ethical issue .
Suppose your salary in 2012 is $70,000. Assuming an annual inflation rate of 7%, what salary do you need to earn in 2019 in order to have the same purchasing power? (Round your answer to two decimal places.)
Answer:
Salary 2019= $112,404.7
Explanation:
Giving the following information:
Salary 2012= $70,000
Inflation rate= 7%
Salary 2019= ?
To calculate the nominal value of your salary to maintain the purchasing power, we need to use the following formula:
FV= PV*(1+i)^n
FV= 70,000*(1.07^7)
FV= $112,404.7
The crowding-out effect refers to the possibility that:
a. a deficit, financed by borrowing in the capital markets, will increase the interest rate and reduce investment in the private sector.
b. an increase in the supply of money will induce a decline in real spending.
c. when used simultaneously, expansionary fiscal and monetary policies are counter-productive.
d. the speculative demand for money varies inversely with the interest rate.
Answer:
a. a deficit, financed by borrowing in the capital markets, will increase the interest rate and reduce investment in the private sector.
Explanation:
Crowding out effect is when government borrowing from the capital markets leads to an increase in interest rate. this makes it more expensive for private sector to borrow and this reduces investment by private sector
Companies that have multiple outsourcers may hire an outsource relationship management company to monitor and manage the outsourcing relationships. Select one: True False
Answer:
True
Explanation:
But, this answer depends on which companies are outsourcing to and from. This is because the definition of an outsourcer is the large company that outsources the provision of its goods and services to smaller companies and also the small company that provides goods and services to larger companies. It is a pari-passu definition.
If the companies involved in this case are providers of outsourcing services, then they do not require an outsource relationship management company to monitor and manage the outsourcing relationships. Instead, it could occasionally employ consultants to help them in assessing how the relationships are being managed. It is their primary responsibility to manage the outsourcing relationships and should not outsource this management.
Balance sheet and income statement data indicate the following: Bonds payable, 12% (due in 15 years) $1,219,553 Preferred 8% stock, $100 par (no change during the year) $200,000 Common stock, $50 par (no change during the year) $1,000,000 Income before income tax for year $370,069 Income tax for year $111,021 Common dividends paid $60,000 Preferred dividends paid $16,000 Based on the data presented above, what is the times interest earned ratio (round to two decimal places)? a.2.53 b.1.77 c.0.77 d.3.53
Answer:
d.3.53
Explanation:
times interest earned ratio = EBIT / interest expense
interest expense = bonds payable x interest rate = $1,219,553 x 12% = $146,346.36EBIT = Income before income tax for year + interest expense = $370,069 + $146,346.36 = $516,415.36times interest earned ratio = $516,415.36 / $146,346.36 = 3.5287 ≈ 3.53
Preferred dividends are not considered interest expense.
Elmo Johnson was late on his property tax payment to the county. He owed $7,500 and paid the tax four months late. The county charges an annual penalty of 10%. Find the amount of the penalty for the four-month period.
Answer: $250
Explanation:
From the question, we are told that Elmo Johnson was late on his property tax payment to the county and that he owed $7,500 and paid the tax four months late.
We are further told that the county charges an annual penalty of 10%. The amount of the penalty for the four-month period goes thus:
Annual penalty = 10% × $7500
= 0.1 × $7500
= $750
Since he is four months late and there are twelve months in a year, this will be:
= $750 × 4/12
= $750 × 1/3
= $750/3
= $250
Joe Henry's machine shop uses 2,500 brackets during the course of a year. These brackets are purchased from a supplier 90 miles away. The following information is known about the brackets: (12 points) Annual demand 4,000 Holding cost per bracket per year $1.75 Order cost per order $25.00 Lead time 4 days Working days per year 250
a. Given the above information, what would be the economic order quantity (EOQ)?
b. Given the EOQ, what would be the average inventory? What would be the annual inventory holding cost?
c. Given the EOQ, how many orders would be made each year? What would be the annual order cost?
d. Given the EOQ, what is the total annual cost of managing the inventory?
e. What is the time between orders?
f. What is the reorder point (ROP)?
Answer:
a. 339 brackets
b. 169.5 and $296.63
c. 12 and $300
d. $596.63
e. 4 days
f. 40 brackets
Explanation:
Economic Order Quantity is the Order size that minimizes holding costs and ordering cost of inventory.
Economic Order Quantity = √ 2 × Annual Demand × Ordering Cost / (Holding Cost per unit)
= √(2 × 4,000 × $25.00) / $1.75
= 339 brackets
Average Inventory = Economic Order Quantity ÷ 2
= 339 ÷ 2
= 169.5
Annual inventory holding cost = Average Inventory × Holding Cost per unit per year
= 169.5 × $1.75
= $296.63
Orders to make each year = Total Annual Demand ÷ Economic Order Quantity
= 4,000 ÷ 339 brackets
= 11.7994 or 12
Annual order cost = Number of Orders × Cost per Order
= 12 × $25.00
= $300
Total Annual Cost = Annual inventory holding cost + Annual order cost
= $296.63 + $300
= $596.63
Reorder point (ROP) = Lead time × usage per day
= 4 × ( 2,500 / 250)
= 40 brackets
Jasper makes a $25,000, 90-day, 7% cash loan to Clayborn Co. Jasper's entry to record the collection of the note and interest at maturity should be: (Use 360 days a year.)
Answer: B) Debit Cash $25,437.50, credit Interest Revenue $437.50; credit Notes Receivable $25,000.
Explanation:
The interest revenue for the period of 90 days will be;
= 25,000 * 7% * [tex]\frac{90}{360}[/tex]
= $437.50
Total to be received
= 25,000 + 437.50
= $25,437.50
The entry to record will therefore be;
DR Cash $25,437.50
CR Interest Revenue $437.50
CR Notes Receivable $25,000
Initially, the exchange rate between South Korean won and Tunisian dinar is in equilibrium. Then, there is a decrease in demand for Tunisian dinar. As a result of a decrease in demand for Tunisian dinar, what happens to South Korea's currency in relation to Tunisia's currency
Answer:
it appreciates
Explanation:
Exchange rate is the rate at which one currency is exchanged for another currency.
If the demand of the Tunisian dinar decreases, supply of the currency would exceed the demand for the currency. as a result of this, the value of the Tunisian dinar falls , it depreciates and the won appreciates.
Suppose the rate of return on short-term government securities (perceived to be risk-free) is about 5%. Suppose also that the expected rate of return required by the market for a portfolio with a beta of 1 is 12%. According to the capital asset pricing model: a. What is the expected rate of return on the market portfolio?
Answer: 12%
Explanation:
The Capital Asset Pricing Model can be used to calculate the expected return of the portfolio using the formula;
Expected Return = Risk-free rate + beta ( market return - risk-free rate)
Expected Return = 5% + 1(12% - 5%)
Expected Return= 5% + 7%
Expected Return = 12%
A share of common stock just paid a dividend of $1.00. If the expected long-run growth rate for this stock is 5.4%, and if investors' required rate of return is 14.2%, what is the stock price
Answer:
$11.98
Explanation:
A share of common stock just made a dividend payment of $1.00
The expected long-run growth rate of for this stock is 5.4%
= 5.4/100
= 0.054
The investors required rate of return is 14.2%
= 14.2/100
= 0.142
The first step is to calculate the dividend year 1(D1)
D1= Do(1+g)
= 1(1+0.054)
= 1×1.054
= $1.054
Therefore, the stock price can be calculated as follows
Po= D1/(rs-g)
= 1.054/(0.142-0.054)
= 1.054/0.088
= $11.98
Hence the Stock price is $11.98
"The Heating Division of Kobe International produces a heating element that it sells to its customers for $45 per unit. Its variable cost per unit is $30, and its fixed cost per unit is $11. Top management of Kobe International would like the Heating Division to transfer 14,900 heating units to another division within the company at a price of $33. Assume that the Heating Division has sufficient excess capacity to provide the 14,900 heating units to the other division. What is the minimum transfer price that the Heating Division should accept
Answer: $30
Explanation:
The formula to determine the transfer price is;
Transfer price = Differential cost to selling division + Opportunity cost of selling internally
The Differential cost is the Variable cost of producing the heating units so is $30.
The Opportunity cost of selling internally refers to if any sales will be foregone outside by selling inside. As the Heating Division has sufficient excess capacity, outside sales will not be affected so this cost is $0.
Transfer Price = 30 + 0
= $30
Sunland Company estimates that variable costs will be 60.00% of sales, and fixed costs will total $632,000. The selling price of the product is $5. Compute the break-even point in (1) units and (2) dollars.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Sunland Company estimates that variable costs will be 60.00% of sales.
Fixed costs= $632,000
The selling price of the product is $5.
First, we need to calculate the unitary variable cost:
Unitary variable cost= 5*0.6= $3
Now, using the following formulas, we can determine the break-even point in units and dollars.
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 632,000 / (5 - 3)
Break-even point in units= 316,000 units
Break-even point (dollars)= fixed costs/ contribution margin ratio
Break-even point (dollars)= 632,000 / (2/5)
Break-even point (dollars)= $1,580,000
Nadia Company, a merchandising company, prepares its master budget on a quarterly basis. The following data has been assembled to assist in preparation of the master budget for the second quarter.
a. As of March 31 (the end of the prior quarter), the company’s balance sheet showed the following account balances:
Cash $9,000
Acct Receviable 48,000
Inventory 12,6000
Buildings & Equip. (net) 214,100
Acct. Payable 18,300
Common Stock 190,000
Retained Earnings 75,400
Totals 283,700 283,700
b. Sales for March total 10,000 units. Each month’s sales are expected to exceed the prior month’s results by 5%. The product selling price is $25.00 per unit.
c. Sales are 20% for the cash and 80% on credit. All payments on credit sales are collected in the month following the sale. The accounts receivable at March 31 are a result of March credit sales.
d. Company’s policy calls for a given month’s ending inventory to equal 80% of the next month’s expected unit sales. The March 31 inventory is 8,400 units, which complies with the policy. The purchase price is $15.
e. Monthly selling and administrative expenses are budgeted as follows: salaries and wages, $7500 per month; shipping 6% of sales; advertising, $6,000 per month; other expenses, 4% of sales. Depreciation including depreciation on new assets acquired during the quarter, will be $6,000 for the quarter. Sales representatives’ commissions are 12.5 % of sales and are paid in the month of the sales. The sales manager’s salary will be $3,500 in April and $4,000 per month thereafter.
f. Half a month’s inventory purchases are paid in the month of purchase and half in the following month.
g. Equipment purchases during the quarter will be as follows: April, $11,500; and May, $3,000.
h. Dividends totaling $3,500 will be declared and paid in June.
j. No cash payment for income taxes are to be made during the second calendar quarter. Income taxes will be assessed at 35% for the quarter.
k. Management wants to maintain a minimum cash balance of $8,000. The company has an agreement with a local bank that allows the company to borrow in increments of $1,000 at the beginning of each month, up to a total balance of $20,000. The interest rate of these loans is 1% per month, and for simplicity, we will assume that the interest is not compounded. The company would as far as it is able, repay the loan plus accumulated interest at the end of the quarter.
Required: Using the above data, complete the following statements and schedules for the second quarter.
1. Expected cash receipts from customers
2. Expected cash payments for purchases
3. Cash budget
Answer:
Nadia Company
1. Schedule of expected cash receipts from customers :
April May June
Cash 20% $52,500 $55,125 $57,880
Credit 80% 48,000 210,000 220,500
Total receipts $100,500 $265,125 $278,380
2. Schedule of expected cash payments for purchases :
Payment for purchases: April May June
50% (month of purchase) $81,900 $85,995 $90,293
50% (following month) 18,300 81,900 85,995
Total cash payment $100,300 $167,895 $176,288
3. Statement of Cash budget for the second quarter ended June 30:
April May June Total
Beginning cash balance $9,000 ($58,363) ($23,649) $9,000
Cash receipts from customer 100,500 265,125 278,380 644,005
Total cash available $109,500 $206,762 $254,731 $653,005
Cash payments:
Purchases $100,300 $167,895 $176,288 $444,483
Selling & Administrative 76,063 79,516 82,615 238,194
Equipment purchase 11,500 3,000 14,500
Dividends 3,500 3,500
Total cash payments: $187,863 $250,411 $262,403 $700,677
Cash shortfall ($78,363) ($43,649) ($7,672)
Bank overdraft 20,000 20,000 16,000 56,000
Cash balance ($58,363) ($23,649) $8,328 $8,328
Explanation:
a) Data:
Nadia Balance Sheet as of March 31:
Cash $9,000
Acct Receivable 48,000
Inventory 12,6000
Buildings & Equip. (net) 214,100
Total $283,700
Acct. Payable $18,300
Common Stock 190,000
Retained Earnings 75,400
Total $283,700
b) Sales:
Month Quantity Unit Price Total
March 10,000 units $25.00 $250,000
April = 10,500 (10,000 x 1.05) " $262,500
May = 11,025 (10,500 x 1.05) " $275,625
June = 11,576 (11,025 x 1.05) " $289,400
July = 12,155 (11,576 x 1.05) " $303,875
c) Sales Terms:
March April May June
Cash 20% $52,500 $55,125 $57,880
Credit 80% 48,000 210,000 220,500
d) Inventory:
March April May June
8,400 8,820 9,261 9,724
Ending $126,000 $132,300 $138,915 $145,860
Beginning $126,000 $132,000 $138,915
e) Selling & Administrative Expenses
April May June Total
Salaries and wages $7,500 $7,500 $7,500 $22,500
Shipping 15,750 16,538 17,364 49,652
Advertising 6,000 6,000 6,000 18,000
Others 10,500 11,025 11,576 33,101
Depreciation 6,000
Sales commissions 32,813 34,453 36,175 104,441
Sales Manager's Salary 3,500 4,000 4,000 11,500
Total $76,063 $79,516 $82,615
f) Purchases of Inventory
April May June Total
Ending Inventory 8,820 9,261 9,724
Units of Inventory sold 10,500 11,025 11,576
Inventory available for sale 19,320 20,286 21,300
less beginning inventory 8,400 8,820 9,261
Purchases 10,920 11,466 12,039
Cost of purchases x $15 $163,800 $171,990 $180,585
Payment for purchases: April May June
50% (month of purchase) $81,900 $85,995 $90,293
50% (following month) 18,300 81,900 85,995
Total cash payment $100,300 $167,895 $176,288
g) April May June
Equipment purchase $11,500 $3,000
h) Nadia Company's preparation of quarter budgets helps it to foresee cash shortages and make necessary arrangements to meet up with cash obligations. It focuses management efforts to achieve sales and deliver on other perimeters, including the control of expenses. It is important for the master budget to be prepared with inputs from other subsidiary budgets so that management plans ahead.
Tobitzu TV produces wall mounts for flat panel television sets. The forecasted income statement for 2015 is as follows:
TOBITZU TV Budgeted Income Statement For the Year 2015
Sales ($49 per unit) $4,900,000
Cost of good sold ($32 per unit) (3,200,000)
Gross profit 1,700,000
Selling expenses ($4 per unit) (400,000)
Net income $1,300,000
Additional Information:
a. Of the production costs and selling expenses, $600,000 and $100,000, respectively, are fixed.
b. Tobitzu TV received a special order from a hospital supply company offering to buy 12,000 wall mounts for $30. If it accepts the order, there will be no additional selling expenses, and there is currently sufficient excess capacity to fill the order. The company's sales manager argues for rejecting the order because "we are not in the business of paying $32 to make a product to sell for $30."
Required:
Calculate the net benefit (cost) of accepting the special order.
Answer:
$48,000 net benefit
Explanation:
For computing the net benefit or net cost for accepting the special order first we need to find out the variable cost of goods sold per unit which is shown below:
The variable cost of goods sold is
= total cost of goods sold - fixed production costs
= $3,200,000 - $600,000
= $2,600,000.
Now
Total units produced is
= Total revenue ÷ selling price per unit
= $4900000 ÷ 49
= 1,00,000 units.
So, variable cost of goods sold per unit is
= $2,600,000 ÷ 1,00,000
= $26 per unit.
Therefore the net benefit or cost arises is
= (Revenue generated from the special order) - (variable cost of goods sold)
= (12,000 × $30) - (12,000 × $26)
= $48,000 net benefit
Blackwelder Factory produces two similar products-small lamps and desk lamps. The total plant overhead budget is $667,000 with 465,000 estimated direct labor hours. It is further estimated that small lamp production will require 299,000 direct labor hours and desk lamp production will need 166,000 direct labor hours. Using the single plantwide factory overhead rate with an allocation base of direct labor hours, how much factory overhead will Blackwelder Factory allocate to desk lamp production if actual direct hours for the period is 249,000. a.$356,070 b.$800,936 c.$1,000,500 d.$310,930
Answer:
Allocated MOH= $356,070
Explanation:
Giving the following information:
Estimated overhead= $667,000
Estimated direct labor hours= 465,000
Actual direct labor hours for lamp desk= 249,000
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 667,000/465,000
Predetermined manufacturing overhead rate= $1.43 per direct labor hour
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 1.43*249,000
Allocated MOH= $356,070
Development normally stops at about age:
A. 40
B. 25.
C. Development never stops.
D. 5.
Answer:
B. 25.
Explanation:
Normally the life of a human breaks into various stages like infancy, childhood, adolescence, old age ,and adulthood which depends upon the level of age.
Like we can say that in the age of 18 the person is an adult but at the age of 25 he has reached to the level of maturity in term of mental, physical, strength, emotional, etc
And at this level, the development normally stops i.e brain not with the person body
Hence, option b is correct
Answer:
development never stops
Explanation:
our bodies are always changing and always growing to be something different. This includes every 7 years our cells are completely changed so we are practically all new people. option c is also the right answer on apex.
A large open economy has desired national saving of Sd = 1200 + 1000rw, and desired national investment of Id = 1000 - 500rw. The foreign economy has desired national saving of = 1300 + 1000rw, and desired national investment of = 1800 - 500rw. The equilibrium world real interest rate equal to:________.
Answer: 10%
Explanation:
The Equilibrium real interest rate would be the interest rate that equates the Desired savings to the desired investment for both the National and foreign economy.
Desired national saving + Foreign desired national saving = Desired national investment + Foreign desired national investment
1,200 + 1,000rw + 1,300 + 1,000rw = (1,000 - 500rw) + (1,800 - 500rw)
2,500 + 2,000rw = 2,800 - 1,000rw
2,000rw + 1,000rw = 2,800 - 2,500
3,000rw = 300
rw = 0.1
rw = 10%
Dothan Inc.'s stock has a 25% chance of producing a 30% return, a 50% chance of producing a 12% return, and a 25% chance of producing a −18% return. What is the firm's expected rate of return?
Answer:
Therefore, the firm's expected rate of return is 9%.
Explanation:
The expected rate of return of an investment refers to the profit or loss which an investors is anticipating to receive from the investment at a specified rate of return.
The expected rate of return is estimated by totaling the product of potential outcomes and the chances of the outcomes occurring.
For Dothan Inc.'s stock therefore, the expected rate of return can be estimated as follows:
Expected rate of return = (25% * 30%) + (50% * 12%) - (25% * 18%) = 9%
Therefore, the firm's expected rate of return is 9%.
As illustrated by Textron Inc., when a firm uses the __________ structure hierarchy, the headquarters might rely on strategic controls to set rate-of-return targets and financial controls to monitor divisional performance relative to those targets and then allocate cash flow to the different divisions accordingly.
Answer:. Competitive
Explanation:
The competitive structure hierarchy is the most costky and also the most centralized form of multidivisional structure.
It should be noted that when this structure is used, the headquarters might rely on strategic controls to set rate-of-return targets and financial controls to monitor divisional performance relative to those targets and then allocate cash flow to the different divisions accordingly.
A metal fabricator produces connecting rods with an outer diameter that has a 1 ± .01 inch specification. A machine operator takes several sample measurements over time and determines the sample mean outer diameter to be 1.002 inches with a standard deviation of .003 inch.
a. Calculate the Cp of the process. (Round your answer to 3 decimal places.)
Cp =
b. Calculate the Cpk of the process. (Round your answer to 3 decimal places.)
Cpk =
Answer:
A) 1.111
B) 0.889
Explanation:
given data :
outer diameter of connecting rods = 1 ± 0.01 inch
sample mean outer diameter = 1.002 inches
standard deviation = 0.003 inches
A) Calculating the Cp of the process
mean = 1.002
Standard deviation = 0.003
LSL = 1 - 0.01 = 0.99
USL = 1 + 0.01 = 1.01
[tex]Cp = \frac{USL - LSL}{6 * STANDARD DEVIATION}[/tex] = [tex]\frac{1.01-0.99}{6*0.003}[/tex] = 1.111
B) calculate Cpk
mean = 1.002, LSL = 0.99, USL = 1.01 , deviation = 0.003
[tex]Cpk = min[\frac{mean-LSL}{3* deviation} , \frac{USL- mean}{3*deviation} ][/tex]
= min [(0.012/0.009) , (0.008/0.009) ]
= min [ 1.333, 0.889 ]
hence Cpk = 0.889