Answer:
the inventory turns will be "10". A further explanation is given below.
Explanation:
The given values are:
Annual sales,
= $68
Number of inventory turns,
= 8
Increase annual sales,
= 25%
Now,
The average inventory will be:
= [tex]\frac{Annual \ sales}{Number \ of \ inventory \ turns}[/tex]
On substituting the given values, we get
= [tex]\frac{68}{8}[/tex]
= [tex]8.5 \ million[/tex]
The projected annual sales will be:
= [tex]68\times 1.25[/tex]
= [tex]85[/tex]
then,
The revised inventory turns will be:
= [tex]\frac{Project \ annual \ sales}{Average \ inventory}[/tex]
= [tex]\frac{85}{8.5}[/tex]
= [tex]10[/tex]
Hubert lives in San Francisco and runs a business that sells boats. In an average year, he receives $842,000 from selling boats. Of this sales revenue, he must pay the manufacturer a wholesale cost of $452,000; he also pays wages and utility bills totaling $301,000. He owns his showroom; if he chooses to rent it out, he will receive $38,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Hubert does not operate this boat business, he can work as an accountant, receive an annual salary of $48,000 with no additional monetary costs, and rent out his showroom at the $38,000 per year rate. No other costs are incurred in running this boat business.
Identify each of Hubert's costs in the following table as either an implicit cost or an explicit cost of selling pianos.
Implicit Cost Explicit Cost
The wholesale cost for the pianos that Hubert pays the manufacturer
The salary Hubert could earn if he worked as an accountant
The wages and utility bills that Hubert pays
The rental income Hubert could receive if he chose to rent out his showroom
Complete the following table by determining Hubert's accounting and economic profit of his piano business.
Profit
(Dollars)
Accounting Profit
Economic Profit
If Hubert's goal is to maximize his economic profit, he( should, should not) stay in the piano business because the economic profit he would earn as an accountant would be $______.
Answer:
Explicit costs are normal costs of operating a business.
Implicit costs are opportunity costs meaning that they are the benefits foregone by engaging in a certain course of action.
The wholesale cost for the pianos that Hubert pays the manufacturer ⇒ EXPLICIT COST.
The salary Hubert could earn if he worked as an accountant ⇒ IMPLICIT COST.
The wages and utility bills that Hubert pays ⇒ EXPLICIT COST
The rental income Hubert could receive if he chose to rent out his showroom. ⇒ IMPLICIT COSTS
Accounting Profit = Revenue - Explicit costs
= 842,000 - 452,000 - 301,000
= $89,000
Economic Profit = Revenue - Explicit costs - Implicit costs
= 842,000 - 452,000 - 301,000 - 38,000 - 48,000
= $3,000
If Hubert's goal is to maximize his economic profit, he should stay in the piano business because the economic profit he would earn as an accountant would be -$3,000.
Economic profit as accountant = Salary + rental income - accounting profit from piano
= 48,000 + 38,000 - 89,000
= -$3,000
Juno Corporation's stockholders' equity section at December 31, 2019 appears below: Stockholder's equity Paid-in capital Common stock, $10 par, 60,000 outstanding $600,000 Paid-in capital in excess of par 150,000 Total paid-in capital $750,000 Retained earnings 150,000 Total stockholder's equity $900,000 On June 30, 2020, the board of directors of Juno Corporation declared a 20% stock dividend, payable on July 31, 2020, to stockholders of record on July 15, 2020. The fair value of Juno Corporation's stock on June 30, 2020, was $15. On December 1, 2020, the board of directors declared a 2 for 1 stock split effective December 15, 2020. Juno Corporation's stock was selling for $20 on December 1, 2020, before the stock split was declared. Par value of the stock was adjusted. Net income for 2020 was $190,000 and there were no cash dividends declared.
Prepare the journal entries on the appropriate dates to record the stock dividend and the stock split. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) Date Account Titles and Explanation Debit Credit 6/30/17 7/15/17 7/31/17 12/1/17 12/15/17 SHOW LIST OF ACCOUNTS Fill in the amount that would appear in the stockholders' equity section for Juno Corporation at December 31, 2017, for the following items:
1. Common stock $
2. Number of shares outstanding
3. Par value per share $
4. Paid-in capital in excess of par $
5. Retained earnings $
6. Total stockholders’ equity $
Answer:
Explanation:
Date Particulars Amount (Dr) Amount (Cr)
6/30/17 Stock dividends
(60,000 × 20% × 15) 180000
Common stock dividend
distributable 120000
Paid-in Capital in Excess of Par
common stock 60000
7/15/17 No entry
7/31/17 Common stock dividend distributable 120000
Common stock 120000
12/1/17 No entry
12/15/17 No entry
Particulars
1. Common stock = (72000 × 2 × 5) $720,000
2. Number of shares outstanding (60000+12000)×2 144000
3. Par value per share (10/2) $5
4. Paid-in capital in excess of par (150000+60000) $210000
5. Retained earnings (150000+190000-180000) $160000
6. Total stockholders' equity $1090000
Which of the statements is not true about a bank run? Fears leading to bank runs can be self-fulfilling. There was a wave of bank runs during the Great Depression. Bank runs are bad for the bank affected and usually good for the bank's competitors. Deposit insurance is designed to reduce the risk of bank runs for depository banks. Since the Great Depression the government has set up regulation that has eliminated most bank runs.
Answer:
Bank runs are bad for the bank affected and usually good for the bank's competitors
Explanation:
A bank run happens when bank depositors withdraw their money deposited due to fear of the bank's solvency.
Bank runs can work as a self fulfilling prophecy. For example, if there a rumour that a bank is insolvent and it is not, depositors would start withdrawing their monies. This would eventually lead to the bank being insolvent.
Bank runs affect other banks and can lead to the collapse of the whole financial system. Bank runs occurred during the great depression
Bank runs led to the establishment of deposit insurance. The aim of deposit insurance is to increase the confidence of depositors in banks because depositors know their deposits are insured
Suppose there are only two producers of aircraft in the world, AirCraft in the United States and AirEurope in the European Union. The following hypothetical payoff matrices show the profits (in millions of dollars) for each company. In the absence of subsidies, if only one company makes aircraft, it receives a profit of $90 million. If both companies decide to produce, they each lose $3 million. When a company decides not to produce, it earns zero profit.
Air Europe
Produce Not produce
Aircraft Produce -3,-3 65,0
Not Produce 0,65 0,0
Suppose that the European Union considers aircraft a strategic industry gives Air-Europe a $9 million subsidy if it produces.
With a $9 million subsidy, regardless of whether Aircraft produces Or not, AirEurope _______produce if it wants to maximize its profit.
Because AirEurope will enter the market if given a $9 million subsidy, AirCraft should also produce in this industry.
a. True
b. False
Answer:
1. AirEurope should produce if it wants to maximize its profit.
2. False
Explanation:
New payoffs after subsidy:
Aircraft/ AirEurope Produce Not Produce
Produce -3 , 6 75 , 0
Not Produce 0 , 74 0 , 0
With a $9 million subsidy, regardless of whether Aircraft produces or not, AirEurope should produce if it wants to maximize its profit.
The statement is false (Aircraft would earn a negative payoff if it enters).
Robyn rents her beach house for 60 days and uses it for personal use for 30 days during the year. The rental income is $6,000 and the expenses are as follows: Mortgage interest $9,000 Real estate taxes 3,000 Utilities 2,000 Maintenance 1,000 Insurance 500 Depreciation (rental part) 4,000 Using the IRS approach, total expenses that Robyn can deduct on her tax return associated with the beach house are:
Answer:
$12,000
Explanation:
Calculation to determine the total expenses that Robyn can deduct on her tax return associated with the beach house are:
Mortgage interest $9,000
Add Real estate taxes 3,000
Total Expense $12,000
($9,000+$3,000)
Therefore the total expenses that Robyn can deduct on her tax return associated with the beach house are:$12,000
You plan to purchase a $240,000 house using a 30-year mortgage obtained from your local credit union. The mortgage rate offered to you is 8 percent. You will make a down payment of 10 percent of the purchase price.
a. Calculate your monthly payments on this mortgage. (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16))
Monthly payment $
b. Construct the amortization schedule for the first six payments. (Do not round intermediate calculations. Round your answers to 2 decimal places. (e.g., 32.16))
Amortization Schedule for first 6 payments (months)
Month Beginning Loan Balance Payment Interest Principal Ending Loan
Balance
1 $ $ $ $ $
2
3
4
5
6
Answer:
a. The monthly payments are:
= $1,584.93
b. Amortization Schedule for the first six payments:
Month Beginning Balance Interest Principal Ending Balance
1 $216,000.00 $17,214.79 $1,804.37 $214,195.61
2 $214,195.61 $17,065.03 $1,954.13 $212,241.46
3 $212,241.46 $16,902.82 $2,116.34 $210,125.12
4 $210,125.12 $16,727.19 $2,291.97 $207,833.12
5 $207,833.12 $16,536.94 $2,482.22 $205,350.89
6 $205,350.89 $16,330.93 $2,688.23 $202,662.63
Explanation:
a) Data and Calculations:
Monthly Pay: $1,584.93
Monthly Total
Mortgage Payment $1,584.93 $570,575.33
House Price = $240,000.00
Loan Amount = $216,000.00
Down Payment = $24,000.00 ($240,000 * 10%)
Total of 360 Mortgage Payments $570,575.33
Total Interest $354,575.33
Mortgage Payoff Period = 360 (12 * 30 years) months
A baker knows that her customers will pay $5 for a loaf of bread, but if the marginal
utility decreases after the first loaf, how might the baker get her customers to buy more
than one loaf?
Answer: Sell at lower price
Explanation:
Marginal Utility is the amount of satisfaction that her customers will get with every additional unit of bread purchased.
If the marginal utility decreases, her customers will buy less bread because to them, it is not as valuable anymore. If she offers her bread at lower prices, the customers would buy more because the new price will align with the lower utility the customers get from the additional loaves.
d (i). Suppose that ZX Inc. is currently selling at $50 per share. You buy 200 shares, using $5,000 of your own money and borrowing the remainder of the purchase price from your broker. The rate on the margin loan is 5%. What is the rate of return on your margined position (assuming again that you invest $5,000 of your own money) if ZX Inc. is selling after one year at $46 (use whole number percentage with two decimals rounded up/down - i.e. 0.3245 input 32.45) ? Group of answer choices -21% -20% -19% -18%
Answer:
-21%
Explanation:
Initial share price = $50
Share price after 1 year = $46
net return = (200 x $46) - $10,000 - ($5,000 x 5%) = $9,200 - $10,000 - $250 = -$1,050
rate of return of margined position = -$1,050 / $5,000 = -0.21 = -21%
when you operate on the margin, your earnings can increase or decrease dramatically. In this case, an 8% price decrease resulted in a 215 lose.
ecause of coronavirus, demand for Vitamin C tablets increased significantly at CVS. CVS started to observe a weekly demand of 85 boxes of Vitamin C tablets with a standard deviation of 50 boxes. The cost of placing an order is $200, and the time from ordering to receipt is 4 weeks. The procurement cost (wholesale price) of the product is $15. The annual inventory carrying cost is 10% of the procurement cost of the product. What is the reorder point if it wants to achieve a stock out probability of 5%
Answer:
505 boxes approximately
Explanation:
The weekly demand is = d = 85 boxes
Standard deviation s = 50
Cost of placing order = $200
Ordering time = lead time L = 4 weeks
Stock out probability = 5% = 1-0.05 = 0.95
The reorder point has this formula:
(D*L)+(Z*s*√L)
To get the value of Z we use this excel function NORMSINV(0.95) = 1.644853672
When we put in values into the formula we have:
(85x4)+(1.644853672x50x2)
= 340 + 164.485
= 504.5
Approximately 505 boxes
An investor believes that the U.S. dollar will rise in value relative to the Japanese yen. The same investor is considering two investments with identical risk and return characteristics. One stock is trading in yen in Japan and the other stock is a stock trading in dollars in the United States. Should the investor purchase the Japanese stock?
Answer:
No. The investor will lose money in the currency exchange if the U.S. dollar gains strength relative to the Japanese yen.
Explanation:
From the question, we are informed about An investor who believes that the U.S. dollar will rise in value relative to the Japanese yen. The same investor is considering two investments with identical risk and return characteristics. One stock is trading in yen in Japan and the other stock is a stock trading in dollars in the United States. In this case , the investor should not purchase the Japanese stock this is because he will lose money in the body of currency exchange, especially in a case whereby U.S. dollar gains strength in relative to Japanese yen.
Journalize the following merchandise transactions, using the net method under a perpetual inventory system.
a. Sold merchandise on account, $18,000 with terms 1/10, n/30. The cost of the goods sold was $10,800.
b. Received payment less the discount.
c. Refunded $600 to customer for defective merchandise that was not returned.
Answer:
Part a
Debit : Accounts Receivable $18,000
Debit : Cost of Sales $10,800
Credit : Sales Revenue $18,000
Credit : Inventory $10,800
Part b
Debit : Cash $16,200
Debit : Discount allowed $1,800
Credit : Accounts Receivable $18,000
Part c
Debit : Accounts Receivable $600
Credit : Cash $600
Explanation:
The perpetual method calculates the cost of sales for each transaction made.
See the journals prepared as above
The most recent financial statements for Cardinal, Inc., are shown here: Income Statement Balance Sheet Sales $23,500 Assets $121,000 Debt $31,600 Costs 16,700 Equity 89,400 Taxable income $6,800 Total $121,000 Total $121,000 Taxes (24%) 1,632 Net income $5,168 Assets and costs are proportional to sales. Debt and equity are not. A dividend of $1,560 was paid, and the company wishes to maintain a constant payout ratio. Next year's sales are projected to be $28,300. What is the external financing needed?
Answer:
$20,370.5
Explanation:
Net Profit Margin = Net Profit / Sales= 5,168 / 23500 = 0.219915 = 21.99%
Dividend Payout Ratio = Dividends / Net profit = $1,560/$5,168 = 0.3018576 = 30.19%
Increase in Assets = Total Assets / Current Sales * Change in Sales
Increase in Assets = 121,000 /23,500 * (28,300-23,500)
Increase in Assets = 5.1489362 * 4800
Increase in Assets = $24714.89
Increase in Current Liabilities = Current Liabilities / Current Sales * Change in Sales = 0
Earnings Retained = Revised sales * Net profit margin * (1- dividend payout ratio)
Earnings Retained = $28,300 * 21.99% * (1 - 30.19%)
Earnings Retained = $28,300 * 0.2199 * 0.6981
Earnings Retained = $4344.39497
Earnings Retained = $4344.39
External Financing Needed = Increase in Assets - Increase in Current Liabilities - Earnings Retained
External Financing Needed = $24714.89 - $0 - $4344.39
External Financing Needed = $20,370.5
Oriole Company reported cost of goods sold as follows. 2022 2021 Beginning inventory $ 30,150 $ 20,730 Cost of goods purchased 174,240 150,450 Cost of goods available for sale 204,390 171,180 Less: Ending inventory 35,230 30,150 Cost of goods sold $169,160 $141,030 Oriole Company made two errors: 1. 2021 ending inventory was overstated by $2,140. 2. 2022 ending inventory was understated by $5,430. Compute the correct cost of goods sold for each year.
Answer:
2021 2022
Beginning inventory $20,730 $28,010
Cost of goods purchased $150,450 $174,240
Goods Available for sale $171,180 $202,250
Less :Ending Inventory $28,010 $40,660
Cost of goods sold $143,170 $161,590
Note: The ending inventory of 2016 will become beginning inventory of 2017.
RAK Co. wants to issue new 20-year bonds for some much-needed expansion projects. The company currently has 5.7 percent coupon bonds on the market that sell for $1,048, have a par value of $1,000, make semiannual payments, and mature in 20 years. What coupon rate should the company set on its new bonds if it wants them to sell at par
Answer:
5.31%
Explanation:
FV = 1000
Coupon rate = 5.7%
No of compound = 2
Interest per period = $28.5
Bond price = $1048
No of years to maturity = 20
No of compounding till maturity = 40
Coupon rate set on new bonds = Rate(Nper, PMT, -PV, FV) * 2
Coupon rate set on new bonds = Rate(40, 28.5, -1048, 1000) * 2
Coupon rate set on new bonds = 0.02655 * 2
Coupon rate set on new bonds = 0.0531
Coupon rate set on new bonds = 5.31%
Albatross Software has two main products: WindSong is a program that can be used to edit audio files and SunBurst is a program that can be used to edit digital photos. The two major types of customers are small businesses and home users. The small business customers have a reservation price of $300 for WindSong and $450 for SunBurst. The home users have a reservation price of $100 for WindSong and $125 for SunBurst. Which of the following statements is true?
A) Bundling the two software products is not likely to be profitable because the marginal cost of producing sofware is positive by very small.
B) Bundling the two software products is not likely to be profitable because the consumer demands are homogeneous.
C) Bundling the two software products is likely to be profitable because the demands are negatively correlated
D) Bundling the two software products is not likely to be profitable because the demands are positively correlated.
Answer:
D) Bundling the two software products is not likely to be profitable because the demands are positively correlated.
Explanation:
The demand for both products I positively correlated, meaning that a user that purchases one will likely purchase the other one.
Bundling products is generally profitable when the demand for the products is not heterogenous and price discrimination is difficult. In this case, price discrimination is not difficult, and the demand is homogeneous.
Company Omega bought new petroleum refining equipment in the year 2000. The purchase cost was 172,024 dollars and in addition it had to spend 10,610 dollars for installation. The refining equipment has been in use since February 1st, 2000. Omega forecasted that in 2030 the equipment would have a net salvage value of $10,000. Using the US Straight Line Depreciation Schedule, estimate the value of depreciation recorded in the accounting books in the year 2004 if the company decided to sell the equipment on August 5th (of 2004). (note: round your answer to the nearest cent and do not include spaces, currency signs, or commas)
Answer:
depreciation in 2004 = 5754.5
Explanation:
The salvage value of an asset is the book value estimated at the end of depreciation. The straight-line depreciation method equally distributes the depreciation per year throughout the useful life of the equipment.
In order to calculate the depreciation value in 2004, let us first calculate the depreciation. This is calculated as follows:
Total Depreciation = Purchase cost - salvage value
Purchase cost = cost of equipment + cost of installation
= 172024 + 10610 = $182,634
∴ Total depreciation = 182,634 - 10,000
= $172,634
Depreciation per year = Total depreciation ÷ number of years
Number of years = 2030 - 2000 = 30
Depreciation per year = 172,634 ÷ 30
= 5754.5
∴ depreciation in 2004 = 5754.5
Match each description to the appropriate cost flow assumption (a-c).
a. FIFO
b. LIFO
c. Weighted average
5. Produces the same cost of merchandise sold under both the periodic and the perpetual inventory system
6. Rarely used with a perpetual inventory system
7. Produces results that are similar to the specific identification method
8. Widely used for tax purposes
9. Never results in either the highest or lowest possible net income
10. Produces the highest gross profit when costs are decreasing
11. Produces the highest ending inventory when costs are increasing
12. Assigns the same value to all inventory units
13. Prohibited under International Financial Reporting Standards (IFRS)
14. Does not follow the physical flow of goods in most cases
15. Cost of the latest purchases are assigned to ending inventory
Answer:
5. Produces the same cost of merchandise sold under both the periodic and the perpetual inventory system
Cost flow assumption: FIFO
6. Rarely used with a perpetual inventory system
Cost flow assumption: Weighted average
7. Produces results that are similar to the specific identification method
Cost flow assumption: FIFO
8. Widely used for tax purposes
Cost flow assumption: LIFO
9. Never results in either the highest or lowest possible net income
Cost flow assumption: Weighted average
10. Produces the highest gross profit when costs are decreasing
Cost flow assumption: LIFO
11. Produces the highest ending inventory when costs are increasing
Cost flow assumption: FIFO
12. Assigns the same value to all inventory units.
Cost flow assumption: Weighted average
13. Prohibited under International Financial Reporting Standards (IFRS) Cost flow assumption: LIFO
14. Does not follow the physical flow of goods in most cases
Cost flow assumption: LIFO
15. Cost of the latest purchases are assigned to ending inventory
Cost flow assumption: FIFO
Hester operates a hand car wash service and charges customers $10 per car wash. Based on her knowledge of operations, the 100th car in a day costs her $9.95 to wash. If she takes additional business, however, the 101st car will cost her $10.05 to wash. Does she take the additional business? Group of answer choices No, because she has hidden costs that far exceed her estimate of $10.05, so she loses money. No. She turns away business when the cost of an additional unit exceeds the income from it. No, because taking on additional business doesn’t earn her any money. Yes, because if she turns away business, his service will be forced to close. Yes. More business means more revenue, and more revenue means more profits.
Answer: No. She turns away business when the cost of an additional unit exceeds the income from it.
Explanation:
In order to maximize production, the optimal point at which Hester should wash cars is the point where marginal revenue equals marginal cost. Marginal cost should not be above marginal revenue because it would mean that a marginal loss is being made.
At the 101st car, Hester would make a marginal loss of $0.05 because the cost of $10.05 to wash exceeds the revenue of $10.00 that she charges the customer. She should therefore not accept this or additional business because it will lead to her incurring losses.
Amanda, one of Abigail's fellow workers at BOSS, was surprised to learn that her department's schedule was changed from a standard 8 a.m. to 5 p.m. day, with an hour for lunch, to a work day that began at 8 a.m. and ended at 6 p.m., and that included a two-hour lunch. BOSS was located in the far suburbs, and there was little Amanda could do during the two-hour lunch period. What especially upset Amanda was the realization that when she got off work at 6 p.m. and drove 30 minutes to pick up her child at day care, she would be at least an hour late for daycare and would have to pay a very costly penalty. There were no day care facilities closer to the job, so Amanda had little recourse. She raised this concern to her supervisor, and when she was told that the new schedules were going to remain 8-6 with a two-hour lunch, Amanda began a campaign to pressure BOSS to change that schedule back. She wrote letters to the local newspaper, and called a local TV station. When Amanda's employer learned of Amanda's actions, it discharged her under Employment at Will (EAW). Amanda filed suit for wrongful discharge, claiming that this was a public policy exception to EAW because it constrained her Constitutional First Amendment right to Freedom of Speech. Which of the following is most correct?
a. Amanda will not win her lawsuit for wrongful discharge.
b. Amanda will not win her lawsuit for wrongful discharge unless the court decides that Amanda had legal standing to bring the case.
c. Amanda will win her lawsuit for wrongful discharge unless the court decides that BOSS had legitimate business necessity for changing the schedule.
d. Amanda will win her lawsuit for wrongful discharge.
Answer: A. Amanda will not win her lawsuit for wrongful discharge.
Explanation:
Based on the information that was provided, Amanda will not win her lawsuit for wrongful discharge.
The employer-at-will simply means that an employer can dismiss his or her worker as long as it's not illegal. In this case, Amanda will not win because she's hired "at will," and in such cases, the courts will deny her any loss claim that results from her dismissal.
Rosie Dry Cleaning was started on January 1, Year 1. It experienced the following events during its first two years of operation: Events Affecting Year 1 Provided $45,000 of cleaning services on account. Collected $39,000 cash from accounts receivable. Adjusted the accounting records to reflect the estimate that uncollectible accounts expense would be 1 percent of the cleaning revenue on account. Events Affecting Year 2 Wrote off a $300 account receivable that was determined to be uncollectible. Provided $62,000 of cleaning services on account. Collected $61,000 cash from accounts receivable. Adjusted the accounting records to reflect the estimate that uncollectible accounts expense would be 1 percent of the cleaning revenue on account.
Question Completion:
Show the effects of the transactions on the accounting equation for each year.
Answer:
Rosie Dry Cleaning
Effects on the accounting equation of Assets = Liabilities + Equity:
Year 1:
Assets (Accounts Receivable +$45,000) = Liabilities + Equity (Retained earnings: Service Revenue +$45,000)
Assets (Cash +$39,000; Accounts Receivable -$39,000) = Liabilities + Equity
Assets (Accounts Receivable ($450)) = Liabilities + Equity (Retained Earnings - Bad Debt Expense ($450))
Year 2:
Assets (Accounts Receivable ($300)) = Liabilities + Equity (Retained Earnings: Bad Debts Expense ($300))
Assets (Accounts Receivable +$62,000) = Liabilities + Equity (Retained Earnings: Service Revenue +$62,000)
Assets (Cash +$61,000; Accounts Receivable -$61,000) = Liabilities + Equity
Assets (Accounts Receivable ($620)) = Liabilities + Equity (Retained Earnings: Bad Debt Expense ($620))
Explanation:
a) Data and Analysis:
Year 1:
Accounts Receivable $45,000 Service Revenue $45,000
Cash $39,000 Accounts Receivable $39,000
Accounts Receivable ($450) Bad Debt Expense ($450)
Year 2:
Accounts Receivable ($300) Bad Debts Expense $300
Accounts Receivable $62,000 Service Revenue $62,000
Cash $61,000 Accounts Receivable $61,000
Accounts Receivable ($620) Bad Debt Expense ($620)
b) The accounting equation is an important concept of accounting which explains that at every given time, the assets of the business are equal to its liabilities and equity. The implication is that the entity's assets are funded by a combination of debts to third parties and owners' equity (capital contributions + retained earnings).
On December 31, 2014, Oakbrook Inc. rendered services to Beghun Corporation at an agreed price of $102,049, accepting $40,000 down and agreeing to accept the balance in four equal installments of $20,000 receivable each December 31. An assumed interest rate of 11% is imputed.
Instructions:
Prepare the entries that would be recorded by Oakbrook Inc. for the sale and for the receipts and interest on the following dates. (Assume that the effective-interest method is used for amortization purposes.)
(a) December 31, 2014.
(b) December 31, 2016.
(c) December 31, 2018.
(d) December 31, 2015.
(e) December 31, 2017.
Answer:
(a) December 31, 2014.
Dr Cash 40,000
Dr Notes receivable 80,000
Cr Service revenue 102,049
Cr Discount on notes receivable 17,951
(b) December 31, 2016.
Dr Cash 20,000
Dr Discount on notes receivable 5,376
Cr Notes receivable 20,000
Cr Interest revenue 5,376
(c) December 31, 2018.
Dr Cash 20,000
Dr Discount on notes receivable 1,982
Cr Notes receivable 20,000
Cr Interest revenue 1,982
(d) December 31, 2015.
Dr Cash 20,000
Dr Discount on notes receivable 6,825
Cr Notes receivable 20,000
Cr Interest revenue 6,825
(e) December 31, 2017.
Dr Cash 20,000
Dr Discount on notes receivable 3,768
Cr Notes receivable 20,000
Cr Interest revenue 3,768
name 4 challenges of the market environment
Explanation:
Challenge 1: Changes in how buyers buy.
Challenge 2: Competition.
Challenge 3: Need for top talent.
Challenge 4: Competing on price only.
Answer:
Karen's (lol).
Fraud (of any kind really).
Budgets.
Hiring.
Which of the following is true of a central bank that employs inflation targeting? A target rate of annual inflation is maintained by increasing or decreasing tax revenues. A target rate of employment is maintained by expanding or contracting the money supply. A target rate of annual inflation is maintained by hiring or firing federal employees. A target rate of annual inflation is maintained by expanding or contracting the money supply.
Answer:
A target rate of annual inflation is maintained by expanding or contracting the money supply.
Explanation:
Inflation targeting may be defined as the monetary policy of the central bank which follows a very explicit goal for the medium term and it announces the inflation target to the general public. According to the economist, the economy would perform better if there is inflation and the price rises. For maintaining the economic growth of a country, inflation or the rise in prices is necessary.
It is done by the Central bank by managing the monetary supply in the market and also maintaining the interest rates in the market. The inflation targeting is considered as the antidote for the stop go money policy of the past.
Presented below are transactions related to Carla Vista Company.
1. On December 3, Carla Vista Company sold $622,200 of merchandise on account to Flint Co., terms 4/10, n/30, FOB destination. Carla Vista paid $330 for freight charges. The cost of the merchandise sold was $372,100.
2. On December 8, Flint Co. was granted an allowance of $20,300 for merchandise purchased on December 3.
3. On December 13, Carla Vista Company received the balance due from Flint Co.
Prepare the journal entries to record these transactions on the books of Carla Vista Company using a perpetual inventory system (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.)
No. Date Account Titles and Explanation Debit Credit
1. (To record credit sale) (To record cost of merchandise sold)
2.
3. Dec 13
Assume that Carla Vista Company received the balance due from Kingbird Co., on January 2 of the following year instead of December 13. Prepare the journal entry to record the receipt of payment on January 2. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry for the account titles and enter for the amounts.)
Date Account Titles and Explanation Debit Credit
Answer:
1. Dec 3
Dr Account receivable-Novak Co $622,200
Cr Sales revenue $622,200
Dec 3
Dr Cost of goods sold $372,100
Cr Inventory $372,100
Dec 3
Dr Freight out $330
Cr Cash $330
2. Dec 8
Dr Sales allowance $20,300
Cr Account receivable-Novak Co $20,300
3. Dec 13
Dr Cash 599,492
Dr Sales discount 2,408
Cr Account receivable-Novak Co 601,900
2. January 2
Dr Cash 601,900
Cr Casta Vista co 601,900
Explanation:
Preparation for the journal entries to record these transactions on the books of Carla Vista
1. Dec 3
Dr Account receivable-Novak Co $622,200
Cr Sales revenue $622,200
(To record credit Sales)
Dec 3
Dr Cost of goods sold $372,100
Cr Inventory $372,100
(To record cost of merchandise sold)
Dec 3
Dr Freight out $330
Cr Cash $330
(To record freight charges)
2. Dec 8
Dr Sales allowance $20,300
Cr Account receivable-Novak Co $20,300
(To record sales allowance)
3. Dec 13
Dr Cash 599,492
(601,900-2,408)
Dr Sales discount 2,408
[($622,200-$20,300)*4%]
Cr Account receivable-Novak Co 601,900
($622,200-$20,300)
2. Preparation of the journal entry to record the receipt of payment on January 2
January 2
Dr Cash 601,900
Cr Casta Vista co 601,900
($622,200-$20,300)
Headland Company loans Sarasota Company $2,190,000 at 6% for 3 years on January 1, 2020. Headland intends to hold this loan to maturity and has the financial ability to do so. The fair value of the loan at the end of each reporting period is as follows. December 31, 2020 $2,238,000 December 31, 2021 2,210,000 December 31, 2022 2,190,000 Prepare the journal entry(ies) at December 31, 2020, and December 31, 2022, for Headland related to these bonds, assuming (a) it does not use the fair value option, and (b) it uses the fair value option. Interest is paid on January 1.
Answer:
A. December 31, 2020
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
December 31, 2022
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
B. December 31, 2020
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
Dr Debt Investment $48,000
Cr Unrealized Holding Gain or Loss-Income ($48,000)
December 31, 2022
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
Dr Unrealized Holding Gain or Loss-Income $20,000
Cr Debt Investments ($20,000)
Explanation:
A. Preparation of the journal entry(ies) at December 31, 2020, and December 31, 2022 assuming it does not use the fair value option,
December 31, 2020
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
($2,190,000*6%)
December 31, 2022
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
B. Preparation of the journal entry(ies) at December 31, 2020, and December 31, 2022 assuming it uses the fair value option. Interest is paid on January 1
December 31, 2020
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
Dr Debt Investment $48,000
Cr Unrealized Holding Gain or Loss-Income ($48,000)
($2,238,000-2,190,000)
December 31, 2022
Dr Interest Receivable $131,400
Cr Interest Revenue ($131,400)
Dr Unrealized Holding Gain or Loss-Income $20,000
Cr Debt Investments ($20,000)
(2,210,000-2,190,000)
name 5 kids who helped the world
Answer:’
Explanation:
Refer to the data below to answer the following questions:
Expenditure Income
C. Consumer goods and services $11,502 Wages and salaries $8,868
Corporate profits 1,686
I: Investment in plants, equipment, and inventory 2,670 Proprietor's income 1,348
G. Government goods and services 3,125 Rents 59
Interest 619
X: Exports 2,260 Taxes on output and import 1,147
Depreciation 2,647
M: Imports (2,757) Statistical discrepancy (106)
GDP: Total value of output $16,800 = Total value of income $16,800
Required:
What share of U.S. total income in 2013 consisted of
a. Wages and salaries
b. Corporate profits
Answer:
What share of U.S. total income in 2013 consisted of Wages and salaries?
The share = Wages and salaries /Total income * 100
The share = $8,868 / $16,800 * 100
The share = 0.5278571 * 100
The share = 52.79%
What share of U.S. total income in 2013 consisted of Corporate profits?
The share = Corporate profits /Total income * 100
The share = $1,686/$16,800 * 100
The share = 0.100357 * 100
The share = 10.03%
Long Company has recently tried to improve its analysis, for its manufacturing process. Units started into production equaled 6,000, and ending work in process equaled 400 units. Long had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied, at the beginning of the process. How much is the materials cost per unit, if ending work in process was 25% complete, and total materials costs equaled $24,000?
a. 4.21
b. 15.00
c. 4.00
d. 3.75
Long Company has recently tried to improve its analysis, for its manufacturing process. Units started into production equaled 6,000, and ending work in process equaled 400 units. Long had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied, at the beginning of the process. How much is the materials cost per unit, if ending work in process was 25% complete, and total materials costs equaled $24,000?
Long Company has recently tried to improve its analysis, for its manufacturing process. Units started into production equaled 6,000, and ending work in process equaled 400 units. Long had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied, at the beginning of the process. How much is the materials cost per unit, if ending work in process was 25% complete, and total materials costs equaled $24,000?a. 4.21
Long Company has recently tried to improve its analysis, for its manufacturing process. Units started into production equaled 6,000, and ending work in process equaled 400 units. Long had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied, at the beginning of the process. How much is the materials cost per unit, if ending work in process was 25% complete, and total materials costs equaled $24,000?a. 4.21b. 15.00
Long Company has recently tried to improve its analysis, for its manufacturing process. Units started into production equaled 6,000, and ending work in process equaled 400 units. Long had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied, at the beginning of the process. How much is the materials cost per unit, if ending work in process was 25% complete, and total materials costs equaled $24,000?a. 4.21b. 15.00c. 4.00
Long Company has recently tried to improve its analysis, for its manufacturing process. Units started into production equaled 6,000, and ending work in process equaled 400 units. Long had no beginning work in process inventory. Conversion costs are applied equally throughout production, and materials are applied, at the beginning of the process. How much is the materials cost per unit, if ending work in process was 25% complete, and total materials costs equaled $24,000?a. 4.21b. 15.00c. 4.00d. 3.75
The annual demand for a product has been projected at 2000 units. This demand is assumed to be constant throughout the year. The ordering cost is $20 per order, and the holding cost is 20 percent of the purchase cost. The purchase cost is $40 per unit. There are 250 working days per year. Whenever an order is placed, it is known that the entire order will arrive on a truck in 6 days. Currently, the company is ordering 500 units each time an order is placed. What level of safety stock would give a reorder point of 60 units? A. 12 B. 18 C. 10 D. 14
Answer: 12
Explanation:
The level of safety stock that would give a reorder point of 60 units goes thus:
Firstly, we should note that the formula that'll be used in calculating the reorder point will be:
= dxL + Safety stock
where,
Reorder point = 60
dxL = (2000/250) x 6 = 48
Safety stock = Unknown
We then put the values gotten into the formula which will be:
Reorder point = dxL + Safety stock
60 = 48 + safety stock
Safety stock = 60 - 48
Safety stock = 12 units
what is a tax bracket?
Answer:
Tax brackets show you the tax rate you will pay on each portion of your income