Answer:
Statement B and Statement C are Correct. And Statement A is not Correct.
Explanation:
Solution:
In this question, statement B and Statement C are correct and Statement A is incorrect. Because:
From the standpoint of the issuer, both Statements B and C are a disadvantages of convertibles. So, statement B and B are correct.
The reason why Statement A is not correct is because convertibles tend to provide an opportunity to the person who is issuer of the convertibles to in order to sell common stock at premium or higher prices with respect to or relative to the prices that are currently prevailing prices.
Hence, Statement A is not correct.
Example suppose in a country there were 1,00,000,000 total populations ,8,000,000 people were unemployed and 72,000,000 were held jobs . calculate,I.The national employment rate? II.National unemployment rate ?
Explanation:
National employment rate=72%
72,000,000/1,00,000,000
National unemployment rate=0.08% =8%
8,000,000/1,00,000,000
As per the given data-
The national employment rate is 72%
The National unemployment rate will be 8%
What is unemployment?
Situation of unemployment refers to the situation when there is a lack of job opportunities and more qualified individuals or candidates seeking job opportunities with their willingness.
The national employment rate helps individuals to know the ratio of employment in the country whereas the national unemployment rate helps to determine the rate of unemployed in the country.
Calculation-
I. The national employment rate
= (employed people / total populations)*100
= (72000,000/ 1,00,000,000)*100
= 72%
II. National unemployment rate
= (unemployed persons/number of persons in the labor force)*100
=(8,000,000 / 1,00,000,000)*100
=8%
Therefore, the rate of employment is 72% whereas the unemployment rate is 8%.
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.
Rowan Co. purchases 200 common shares (40%) of JBI Corp. as a long-term investment for $600,000 cash on July 1. JBI Corp. paid $12,500 in total cash dividends on November 1 and reported net income of $250,000 for the year. (1) - (3) Prepare Rowan's entries to record the purchase of JBI shares, the receipt of its share of JBI dividends and the December 31 year-end adjustment for its share of JBI net income.
Answer:
1. Jul-01
Dr Investment in JBI Corp $ 600,000
Cr Cash $ 600,000
2. Nov-01
Dr Cash $ 5,000
Cr Investment in JBI Corp $ 5,000
3. Dec-31
Dr Investment in JBI Corp $ 100,000
Cr Investment revenue $ 100,000
Explanation:
1. Preparation of Rowan's entries to record the purchase of JBI shares
Jul-01
Dr Investment in JBI Corp $ 600,000
Cr Cash $ 600,000
[To record investment in common shares of JBI Corporation]
2. Preparation of Rowan's entries to record the receipt of its share of JBI dividends
Nov-01
Dr Cash [12,500*40%] $ 5,000
Cr Investment in JBI Corp $ 5,000
[To record receipt of dividends]
3. Preparation of Rowan's entries to record the December 31 year-end adjustment for its share of JBI net income
Dec-31
Dr Investment in JBI Corp [$250,000*40%] $ 100,000
Cr Investment revenue $ 100,000
[To record share of net income for the year]
Assume that a business has $50000 of current assets and $40000 of current liabilities. What is the company’s current ratio?
Answer:
The company's current ratio is 1.25.
Explanation:
The current ratio is calculated by dividing the current assets by the current liabilities:
current assets=$50000
current liabilities=$40000
current ratio=$50000/$40000
current ratio=1.25
According to this, the answer is that the company's current ratio is 1.25.
1. Which statement about leaders and managers is most likely false?
a)
Managers are concerned with the efficiency of results, whereas leaders are
primarily concern with results.
b)
Leaders focus on risk taking whereas managers focus on planning
c)
Leaders accept the status quo, managers challenge it.
d)
Leaders develop but managers maintain.
Answer:
I'd say A!
Explanation:
hope this helps! sorry if it's wrong
Michelle operates several food trucks. Indicate the amount (if any) that she can deduct as an ordinary and necessary business deduction in each of the following situations.
a. Michelle moves her food truck between various locations on a daily rotation. Last week, Michelle was stopped for speeding. She paid a fine of $215 for speeding plus $170 for legal advice in connection with the ticket.
b. Michelle paid $865 to reserve a parking place for her food truck for the fall football season outside the local football arena. Michelle also paid $210 for tickets to a game for her children.
c. Michelle provided a candidate with free advertising painted on her truck during the candidate's campaign for city council. Michelle paid $960 to have the ad prepared and an additional $660 to have the ad removed from the truck after the candidate lost the election.
Answer:
a. Michelle moves her food truck between various locations on a daily rotation. Last week, Michelle was stopped for speeding. She paid a fine of $215 for speeding plus $170 for legal advice in connection with the ticket.
Speeding tickets and fines cannot be deducted as business expenses. But Michelle can deduct all legal expenses.
b. Michelle paid $865 to reserve a parking place for her food truck for the fall football season outside the local football arena. Michelle also paid $210 for tickets to a game for her children.
Michelle can deduct the $865 paid for the space outside the football field, but she cannot deduct the tickets (personal expenses).
c. Michelle provided a candidate with free advertising painted on her truck during the candidate's campaign for city council. Michelle paid $960 to have the ad prepared and an additional $660 to have the ad removed from the truck after the candidate lost the election.
Political donations are not deductible as business expenses.Assume a company is preparing a budget for its first two months of operations. During the first and second months it expects credit sales of $40,000 and $61,000, respectively. The company expects to collect 30% of its credit sales in the month of the sale, 60% in the following month, and 10% is deemed uncollectible. What amount of cash collections from credit sales would the company include in its cash budget for the second month
Answer:
Total cash collection= $42,300
Explanation:
Giving the following information:
Sales:
First month= $40,000
Second month= $61,000
The company expects to collect 30% of its credit sales in the month of the sale, 60% in the following month.
Cash collection Second month:
Cash collection credit sales from the second month= (61,000*0.3)= 18,300
Cash collection credit sales from the first month= (40,000*0.6)= 24,000
Total cash collection= $42,300
Fischer Company has outstanding 8,000 shares of $100 par value, 5% preferred stock, and 50,000 shares of $1 par value common stock. The company has $328,000 of retained earnings. At year-end, the company declares and pays the regular $5 per share cash dividend on preferred stock and a $1.80 per share cash dividend on common stock. What is the total dividends paid by Fischer Company
Answer:
The appropriate solution is "$130,000".
Explanation:
The given values are:
No. of common shares outstanding
= 50,000
Dividend per share
= $1.80
No. of preferred shares outstanding
= 8,000
Dividend per share
= $5
Now,
The total dividend on common shares will be:
= [tex]No. \ of \ common \ shared \ outstanding\times Dividend \ per \ share[/tex]
On substituting the values, we get
= [tex]50,000\times 1.80[/tex]
= [tex]90,000[/tex] ($)
The total dividend on preferred stock will be:
= [tex]No. \ of \ preferred \ shares \ outstanding\times Divided \ per \ share[/tex]
On substituting the values, we get
= [tex]8,000\times 5[/tex]
= [tex]40,000[/tex] ($)
Hence,
The total dividend paid by company will be:
= [tex]Total \ dividend \ on \ common \ shares +Total \ dividend \ on \ preferred \ stock[/tex]
= [tex]90,000+40,000[/tex]
= [tex]130,000[/tex] ($)
Thus the above is the correct answer.
One of the three basic coordination tasks an economy has to face is . In a free-market system, the preceding question is answered by: The price mechanism Input-output analysis Central planning
Available options for question 1.
A. Distribution
B. Location of production
C. Timing of production
D. Reason for production
Answer:
1. Distribution
2. Central planning
Explanation:
One of the three basic coordination tasks an economy has to face is DISTRIBUTION.
In a free-market system, the preceding question is answered by CENTRAL PLANNING
This is evident in the fact that T
The three combination tasks of any economy are:
1) how to utilize its resources efficiently
2) which of the possible combinations of goods to produce
3) how much of the total output of each good to distribute
Hence, the preceding question of DISTRIBUTION, which is "which of the possible combinations of goods to produce." is answered by CENTRAL PLANNING.
This is because Central Planning is the government's effort to determine and combine possible goods to produce to enhance national economic growth.
Morales Company sells $320,000 of its receivables to Instant Factors, Inc. Instant Factors assesses a finance charge of 3% of the amount of receivables sold. Prepare the journal entry to record the sale of the receivables on Morales Company's books. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Answer:
Dr Cash $310,400
Dr Factoring expense$9,600
Cr Account receivable $320,000
Explanation:
Preparation of the journal entry to record the sale of the receivables on Morales Company's books.
Dr Cash $310,400
($320,000-$9,600)
Dr Factoring expense$9,600
($320,000*3%)
Cr Account receivable $320,000
(Being to record the sale of the receivables on Morales Company's books
Suppose that you are considering the development of a residential subdivision. The development will require you to spend $300,000 today to acquire the land. You will also have to spend $750,000 in both years 1 and 2 in order to build the houses. You expect to make $1.5 million in year 3 and $2 million in year 4 from sales of the completed homes. What is the internal rate of return of this project
Answer:
32.52%
Explanation:
Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
Cash flow in year 0 = $-300,000.
Cash flow in year 1 and 2 = $-750,000
Cash flow in year 3 = $1.5 million
Cash flow in year 4 = $2 million
IRR = 32.52%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
The country of Lessidinia has a tax system identical to that of the United States. Suppose someone in Lessidinia bought a parcel of land for 20,000 foci (the local currency) in 1960 when the price index equaled 100. In 2002, the person sold the land for 100,000 foci, and the price index equaled 600. The tax rate on nominal gains was 20 percent. Compute the taxes on the nominal gain and the change in the real value of the land in terms of 2002 prices to find the after-tax real rate of capital gain.
Answer: -30%
Explanation:
The Nominal gain is:
= 100,000 - 20,000
= 80,000 foci
Tax on nominal gain:
= 20% * 80,000
= 16,000 foci
After tax nominal value of land:
= 100,000 - 16,000
= 84,000 foci
The real value given the price index is:
= 84,000 / 600 * 100
= 14,000 foci
After tax real rate of cap. gain:
= (14,000 - 20,000) / 20,000
= -30%
Jhumpa, Stewart, and Kelly are all one-third partners in the capital and profits of Firewalker General Partnership. In addition to their normal share of the partnership's annual income, Jhumpa and Stewart receive an annual guaranteed payment of $10,000 to compensate them for additional services they provide. Firewalker's income statement for the current year reflects the following revenues and expenses: Sales revenue $ 340,000 Interest income 3,300 Long-term capital gains 1,200 Cost of goods sold (120,000 ) Employee wages (75,000 ) Depreciation expense (28,000 ) Guaranteed payments (20,000 ) Miscellaneous expenses (4,500 ) Overall net income $ 97,000 (Leave no answer blank. Enter zero if applicable.) b. How will Firewalker allocate ordinary business income and separately stated items to its partners
Question Completion:
a.Given Firewalker’s operating results, how much ordinary business income (loss) and what separately stated items [including the partners’ self-employment earnings (loss) will it report on its return for the year?
Answer:
Firewalker General Partnership
a) In its return for the year, the partnership will report an ordinary business income of $117,000. It will also report the guaranteed payments and share of remaining profits as allocated below.
b) Allocation of business income:
Jhumpa Stewart Kelly Total
Guaranteed payments $10,000 $10,000 $20,000
Share of profit 32,333 32,333 $32,334 97,000
Total business income $117,000
Explanation:
a) Data and Calculations:
Share of profits and loss:
Jhumpa = 1/3
Steward = 1/3
Kelly = 1/3
Income Statement for the year:
Sales revenue $ 340,000
Cost of goods sold (120,000)
Gross profit $220,000
Interest income 3,300
Long-term capital gains 1,200
Income $224,500
Employee wages (75,000)
Depreciation expense (28,000)
Miscellaneous expenses (4,500)
Net income $117,000
Appropriation Section:
Net income $117,000
Guaranteed payments (20,000)
Shareable income $97,000
Allocation of business income:
Jhumpa Stewart Kelly Total
Guaranteed payments $10,000 $10,000 $20,000
Share of profit 32,333 32,333 $32,334 97,000
Total business income $117,000
An investment has the following characteristics: ATIRRP: After-tax IRR on total investment in the property: 9.0% BTIRRE: Before-tax IRR on equity invested: 17% BTIRRP: Before-tax IRR on total investment in the property: 12% t: Marginal tax rate: 0.40 What would be the break-even interest rate (BEIR), at which the use of leverage is neither favorable nor unfavorable
Answer:
15%
Explanation:
Calculation to determine would be the break-even interest rate (BEIR)
Using this formula
Break-even interest rate (BEIR)= After tax IRR on total investment / (1- Tax rate)
Let plug in the formula
Break-even interest rate (BEIR)=9% / (1-0.40)
Break-even interest rate (BEIR)=9%/0.60
Break-even interest rate (BEIR)= 15%
Therefore would be the break-even interest rate (BEIR), at which the use of leverage is neither favorable nor unfavorable is 15%
How does communication take place in the United States?
Answer:
Communication is the act of giving, receiving, and sharing information in other words, talking or writing, and listening or reading. Good communicators listen carefully, speak or write clearly, and respect different opinions.
Explanation:
have a nice day T_T
All of the following lead people to be credit constrained except a person's credit history. savings. collateral. banking regulations. b. The most important consequence of credit constraints on individuals is difficulty in obtaining gainful employment. an ability to retire at an earlier age. lower interest rates on bank loans. an inability to smooth consumption.
Answer:
Banking regulations Lower interest rates on bank loans.Explanation:
Being credit constrained means that one is unable to borrow because the lenders do not think the individual is capable of paying back.
A person's credit history, savings level and collateral are all very useful in determining if they have the ability to pay back debt. Banking regulations do not directly lead to a credit constraint.
Lower interests on bank loans is only given to more creditworthy entities whom the bank feels will be able to pay back. A credit constrained person is risky and will therefore draw a higher rate from banks to balance that risk.
Credit constraints mean the inability of a person to borrow money from the market. the banking regulations and lower interest rates are the exceptions for persons credit-constrained.
What is credit constrained?It is the inability of a borrower to borrow more money from the lender because, in the opinion of the lender, the borrower does not have the creditworthiness that he/she would pay the debt in time.
The following are the exception to persons being credit-constrained :
The Banking regulationsBank loan with lower interest rate.Therefore, it can be said the above option aptly explains the exception that leads to persons being credit-constrained :
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TPW, a calendar year taxpayer, sold land with a $549,000 tax basis for $820,000 in February. The purchaser paid $89,000 cash at closing and gave TPW an interest-bearing note for the $731,000 remaining price. In August, TPW received a $60,550 payment from the purchaser consisting of a $36,550 principal payment and a $24,000 interest payment. Assume that TPW uses the installment sale method of accounting.
a. Compute the difference between TPW's book and tax income resulting from the installment sale method.
b. Is this difference favorable or unfavorable?
c. Using a 21 percent tax rate, compute PTR's deferred tax asset or liability (identify which) resulting from the book/tax difference.
Complete this question by entering your answers in the tabs below.
Required A Required B Required C
Compute the difference between TPW's book and tax income resulting from the installment sale method. (Round gross profit percentage to 2 decimal places, and intermediate calculations to the nearest whole dollar amount.)
Book/tax difference
Answer:
a. Difference between book income and tax income = $229,505.73
b. The difference between book income and tax income is favorable.
c. Deferred tax liability = $48,196.20
Explanation:
a. Compute the difference between TPW's book and tax income resulting from the installment sale method.
This can be computed as follows:
Amount realized on sale of land = Cash paid by purchaser + Value of interest- bearing note given by the purchaser = $89,000 + $731,000 = $820,000
Adjusted tax basis in land = $549,000
Book income = Amount realized on sale of land - adjusted tax basis in hand = $820,000 - $549,000 = $271,000
Gross profit percent = Book income / Amount realized on sale of land = $271,000 / $820,000 = 0.3305, or 33.05%
Cash received on sale of land = Cash paid by purchaser + Principal payment received in August = $89,000 + $36,550 = $125,550
Tax income =Cash received on sale of land * Gross profit percent = $125,550 * 33.05% = $41,494.28
Difference between book income and tax income = Book income - Tax income = $271,000 - $41,494.28 = $229,505.73
b. Is this difference favorable or unfavorable?
Since the book income greater than the tax income, this implies that the difference between book income and tax income is favorable.
c. Using a 21 percent tax rate, compute PTR's deferred tax asset or liability (identify which) resulting from the book/tax difference.
Deferred tax liability = Difference between book income and tax income * 21% = $229,505.73 * 21% = $48,196.20
Suppose that it has just been projected that, because of a number of technological innova- tions, your firm will need 20 percent fewer clerical employees within the next three years. There are currently 122 clerical positions in the company, split between three departments of equal size. Retirements at this level are projected to be roughly 2 percent per year. Annual vol- untary turnover and involuntary turnover for Department A is 2 percent and 5 percent, respectively; Department B is 3 percent and 3 percent; and Department C is 5 percent and 0 percent. Do you project a labour shortage or surplus in the next three years for clerical positions
Answer:
There will be a labor shortage
Explanation:
number of clerical staffs present = 122 staffs
number of clerical staffs needed in 3 years
= 122 - ( 20% * 122 ) = 97.6 ≈ 98 staffs
next : lets project the number of employees in next three years considering the voluntary and involuntary turnovers
= 122*(1-2%)^3 * (((1-7%)^3)/3 + ((1-6%)^3)/3 + ((1-5%)^3)/3)
= 95.4 ≈ 94 staffs
since the projected number of employees is < number of clerical staffs needed in 3 years, There will be a labor shortage
As a manager seeks to develop her leadership skills, she should be aware that:______.
A. There is one best leadership style to which all managers should aspire
B. Leadership is first and foremost about establishing a deep knowledge of their industry
C. Ideally, managers will have both management and leadership skills
D. Leadership is primarily about personal efficiency
Answer:
B. Leadership is first and foremost about establishing a deep knowledge of their industry.
Explanation:
Leadership is the capacity of a person to influence the actions of others to deliver on set goals and objectives. A leader is someone who gets things done through others.
A manager who seeks to develop her leadership skills should be aware that leadership is first and foremost about establishing a deep knowledge of their industry. As an aspiring leader, a manager must have full knowledge of the industry he or she is working. This is important because the manager would be able to effectively direct, control, motivate and influence people he is leading due to the vast experience gotten from the industry he is operating.
Answer:
Ideally, managers will have both management and leadership skills
Explanation:
just took the test
Ornaments, Inc.,is an all-equity firm with a total market value of $520,000 and 18,500 shares of stock outstanding. Management believes the earnings before interest and taxes (EBIT) will be $73,000 if the economy is normal. If there is a recession, EBIT will be 10 percent lower, and if there is a boom, EBIT will be 20 percent higher. The tax rate is 40 percent. What is the EPS in a recession?
Answer:
2.1308
Explanation:
EPS recession = (EBIT normal * (1 - Reduction in recession) * (1 - Tax rate)/shares
EPS recession = ($73,000 * (1 - 0.1)) * (1 - 0.40)/18,500
EPS recession = $65,700 * 0.6 / 18,500
EPS recession = 2.130810810810811
EPS recession = 2.1308
Froggatt Enterprises,a premier educational products company, experiences ups and downs in demand each year corresponding to major school holidays. The company maintains a steady workforce and uses overtime, inventory, and subcontracting to absorb fluctuations in demand. Expected demand, available capacities, and costs for the next four quarters are given below. There is no beginning inventory. Design a production plan that will satisfy demand at minimum cost.
Period Demand Regular Capacity Overtime Capacity Subcontracting Capacity
1 600 1000 500 500
2 2100 1000 500 500
3 800 1000 500 500
4 1800 1000 500 500
Regular production cost per unit $8
Overtime production cost per unit $10
Subcontracting cost per unit $12
Inventory holding cost per unit per period $1
Answer:
Answer is explained in the explanation section below.
Explanation:
Note: As this question contains tables, here I cannot insert table properly, so I have done it on excel spreadsheet and it is attached in the attachment below. Please refer to the attachment below for the minimum cost production plan.
Please refer to Attachment.
Priority should be given in the order mentioned below.
1. Maintain maximum capacity output even though demand is lower for the period because demand for the next period is higher and inventory holding costs are only $1 per unit per period.
2. Over time output for remaining demand, including demand for the following year, since it is less costly than subcontract production and inventory keeping costs are just $1 per unit per period.
3. There is no obligation for output to be subcontracted.
Retained earnings, December 31, 2019 $342,500
Cost of buildings purchased during 2020 49,000
Net income for the year ended December 31, 2020 55,900
Dividends declared and paid in 2020 32,000
Increase in cash balance from January 1, 2020, to December 31, 2020 22,000
Increase in long-term debt in 2020 44,500
Required:
From the above data, calculate the Retained Earnings balance as of December 31, 2020.
Answer:
the retained earnings balance as on Dec 31,2020 is $72,900
Explanation:
The computation of the retained earnings balance as on Dec 31,2020 is given below:
Ending retained earning balance = Opening retained earnings + net income - dividend paid
= $49,000 + $55,900 - $32,000
= $72,900
hence, the retained earnings balance as on Dec 31,2020 is $72,900
The following information is available for Keyser Corporation for the current year: Beginning Work in Process Cost of Beginning Work in Process: (75% complete) 14,500 units Material $25,100 Started 75,000 units Conversion 50,000 Ending Work in Process Current Costs: (60% complete) 16,000 units Material $120,000 Abnormal spoilage 2,500 units Conversion 300,000 Normal spoilage (continuous) 5,000 units Transferred out 66,000 units All materials are added at the start of production. Refer to Keyser Corporation. Assume that the cost per EUP for material and conversion are $1.75 and $4.55, respectively. What is the cost assigned to ending Work in Process
Answer:
$71,680
Explanation:
Calculation to determine the cost assigned to ending Work in Process
Equivalent Units * Cost per Equivalent Unit =Total
Work in Process Current Costs 16,000* $1.75 =$28,000
Work in Process Current Costs: (60% complete 9,600*$4.55=$43,680
(16,000*60%=9,600)
Total Cost assigned to ending Work in Process=$28,000+$43,680
Total Cost assigned to ending Work in Process=$71,680
Therefore cost assigned to ending Work in Process is $71,680
In this simulation, theoretical utilization of the intensive care unit (ICU) is calculated as the flow rate of patients that arrive for service at the ICU in a given unit of time divided by the ICU’s capacity to serve customers in that same unit of time. You can think about this as demand/capacity. What is the theoretical utilization of the ICU if the mean inter-arrival time is 4 hour(s), the mean length of stay is 6 hour(s), and there are 4 beds in the ICU?
Answer:
The theoretical utilization of the ICU is:
= 0.25 or 25%
Explanation:
Inter-arrival time or flow rate of patients that arrive for service at the ICU = 4 hours
Mean length of stay = 6 hours
ICU's capacity to serve customers in 6 hours = 4*6 = 24 bed-hours
Total demand = 6 hours
Therefore, the theoretical utilization = flow rate of patients that arrive for service at the ICU in a given unit of time divided by ICU's capacity to serve customers in that same unit of time
= 6 hours/24 bed-hours
= 0.25
Swifty Company's financial information is presented below. Sales Revenue $ p?Cost of Goods Sold 536000 Sales Returns and Allowances 37000 Gross Profit p?Net Sales 868000 The missing amounts above are: Sales Revenue Gross Profit a. $905000 $332,000 b. $832,000 $332,000 c. $ 905,000 $416,000 d. $832,000 $416,000
Answer:
The correct answer is A.
Explanation:
The gross profit is calculated by deducting from net sales the cost of goods sold:
Gross profit= net sales - COGS
Gross profit= 868,000 - 536,000
Gross profit= $332,000
Now, the sales revenues are the sales before returns and allowances. Therefore, we need to add them to the net sales:
Sales revenue= 868,000 + 37,000
Sales revenues= $905,000
Carillo Industries collected $108,000 from customers in 2017. Of the amount collected, $25,000 was for services performed in 2016. In addition, Carillo performed services worth $36,000 in 2017, which will not be collected until 2018.
Carillo Industries also paid $72,000 for expenses in 2017. Of the amount paid, $30,000 was for expenses incurred on account in 2016. In addition, Carillo incurred $42,000 of expenses in 2017, which will not be paid until 2018.
Instructions:
(a) Compute 2017 cash-basis net income.
(b) Compute 2017 accrual-basis net income.
Answer and Explanation:
The computation is shown below;
But before reaching to the final answers, first do the following calculations
Cash collected $108000
Add Services performed in 2017(not collected) $36000
less Services performed in 2016(collected in 2017) $25000
Revenue for 2017 $119,000
Cash paid in 2017 $72,000
Add Expense incurred not yet paid for 2017 $42000
Less Expense paid for 2016 -$30000
Expense for 2016 $84000
Now
a. Cash basis
Revenue $108000
Less Expenses -$72,000
Net income $36000
b. Accrual basis
Revenue for 2017 $119,000
Less Expenses for 2017 $84,000
Net income $35,000
Accounting records for NIC Enterprises (NICE) for September show the following (each entry is the total of the actual entries for the account for the month). Account Titles Debit Credit Work-in-Process Inventory (Direct Labor) 100,000 Wages Payable 100,000 Direct Materials Inventory 1,112,000 Accounts Payable 1,112,000 Finished Goods Inventory 1,770,000 Work-in-Process Inventory 1,770,000 Cost of Goods Solda 1,710,000 Finished Goods Inventory 1,710,000 aThis entry does not include any over- or underapplied overhead. Over- or under applied overhead is written off to Cost of Goods Sold once for the month. For September, the amount written off was 3 percent of overhead applied for September. Overhead is applied on the basis of direct labor costs. The Work-in-Process ending account balance on September 30 was 170 percent of the beginning balance. The direct material ending inventory balance on September 30 was $36,000 less than the beginning balance. The finished goods beginning balance on September 1 was $203,000. The September income statement shows revenues of $2,850,000 and a gross profit of $1,167,000. Required: a. What was the Finished Goods inventory on September 30
Answer: $263,000
Explanation:
Based on the information given, the finished goods inventory on September 30 will be calculated as:
= Begining inventory + Transfers in - Transfers out.
= $203000 + $1,770,000 - $1,710,000
= $263,000
Therefore, finished goods inventory on September 30 was $263,000
Zeibart Company purchases equipment for $225,000 on July 1, 2016, with an estimated useful life of 10 years and expected salvage value of $25,000. Straight-line depreciation is used. On July 1, 2020, economic factors cause the market value of the equipment to decline to $90,000. On this date, Zeibart examines the equipment for impairment and estimates $125,000 in future cash inflows related to use of this equipment.
Required:
a. Is the equipment impaired at July 1, 2020?
b. If the equipment is impaired on July I, 2020, compute the impairment loss and prepare a journal entry to record the loss.
Answer:
a. Yes, the equipment is impaired at July 1, 2020.
b. Impairment loss is $20,000. And the journal entries are as follows:
Debit Impairment loss for $20,000
Debit Accumulated depreciation for $80,000
Credit Equipment for $100,000
Explanation:
a. Is the equipment impaired at July 1, 2020?
This can be determined as follows:
Annual depreciation = (Cost - Salvage value) / Estimated useful life = ($225,000 - $25,000) / 10 = $20,000
Accumulated depreciation till July 1, 2020 = Annual depreciation * Number of years from July 1, 2016 to July 1, 2000 = $20,000 * 4 = $80,000
Net book value at July 1, 2020 = Cost - Accumulated depreciation till July 1, 2020 = $225,000 - $80,000 = $145,000
Equipment recoverable amount = Estimated future cash inflows related to use of the equipment = $125,000
Since the net book value of $145,000 is greater than the recoverable amount of the equipment of $125,000, this implies that the equipment is impaired at July 1, 2020.
b. If the equipment is impaired on July I, 2020, compute the impairment loss and prepare a journal entry to record the loss.
Accumulated depreciation till July 1, 2020 = $80,000
Estimated future cash inflows related to use of the equipment = $125,000
Fair market value = $90,000
Recoverable amount = Higher of estimated future cash inflows related to use of the equipment or Fair market value = $125,000
Net book value at July 1, 2020 = $145,000
Impairment loss = Net book value at July 1, 2020 - Recoverable amount = $145,000 - $125,000 = $20,000
The journal entries will then look as follows:
Date Details Debit ($) Credit ($)
01 Jul 2020 Impairment loss 20,000
Accumulated depreciation 80,000
Equipment 100,000
(To record impairment loss.)
Blair Madison Co. issues $2.0 million of new stock and pays $291,000 in cash dividends during the year. In addition, the company took advantage of falling interest rates to borrow $1.60 million in a new bond issue and paid off existing bonds with a face value of $2.50 million. The company bought 510 of another company's $1,100 bonds at a $110,000 premium. The net cash flow provided by financing activities is:
Answer:
$809,000
Explanation:
Bliss madison offers $2,000,000 new stocks
He pays $291,000 in cash dividend
The company took advantage of the falling interest rate to borrow $1,600,000
They paid off bonds with an existing face value of $2,500,000
Therefore the net cash flow can be calculated as follows
= 2,000,000-291,000+1,600,000-2,500,000
= 809,000
Hence the net cash flow is $809,000
Mary Willis is the advertising manager for Bargain Shoe Store. She is currently working on a major promotional campaign. Her ideas include the installation of a new lighting system and increased display space that will add $57,600 in fixed costs to the $387,600 currently spent. In addition, Mary is proposing that a 5% price decrease ($60 to $57) will produce a 20% increase in sales volume (20,000 to 24,000). Variable costs will remain at $36 per pair of shoes. Management is impressed with Maryâs ideas but concerned about the effects that these changes will have on the break-even point and the margin of safety.
Q1) Compute the current break-even point in units, and compare it to the break-even point in units if Maryâs ideas are used. (Round answers to 0 decimal places, e.g. 1,225.)
Q2) Compute the margin of safety ratio for current operations and after Maryâs changes are introduced. (Round answers to 0 decimal places, e.g. 15%.))
Q3Prepare a CVP income statement for current operations and after Maryâs changes are introduced.
Answer:
1. Current BEP is 16,150 units that increases to 21,200 units.
2. Current margin of safety is 19% that falls to 12%
Explanation:
1. Current break-even point = Fixed cost / contribution margin
Fixed cost = $387600
Contribution margin = Sales price - variable cost
= 60 - 36 = $24
Current BEP = 387600 / 24 = 16,150 units
BEP if Maryas ideas are used:
Fixed cost = 57600 + 387600 = $445,200
Contribution margin = 57 - 36 = $21
BEP = 445200 / 21 = 21,200 units
BEP increases to 21,200 units from 16,150 units in case Maryas ideas are used.
2. Current Margin of safety Ratio = Actual sales - BEP / Actual sales
= 20,000 - 16,150 / 20,000
= 3850/20000
= 0.1925 or 19%
Margin if safety if Maryas ideas used = 24000 - 21200 / 24000
= 2800/24000
= 0.1167 or 12%
Margin of safety falls to 12% from 19% if Maryas ideas are used.
3. Current income statement
Sales (20,000 * 60) $1,200,000
less: Variable expense $720,000
(20,000*36)
Contribution margin $480,000
less Fixed expense $387,600
Net income $92,400
Income statement after Maryas ideas
Sales (24,000 * 57) $1,368,000
less: Variable expense $864,000
(24,000*36)
Contribution margin $504,000
less Fixed expense $445,200
Net income $58,800
Explain how political and international factors pose challenges to businesses.
Answer:
Synonyms:complicated, difficult, complex, elaborate, confused, confusing, incomprehensible, intricate, contorted, involved
Antonyms:straightforward, simple, make sense, understandable, intelligible, apparent, easy, evident, clear-cut, manifest
Entry:decadence
Synonyms:indulgence, self-indulgence, sybaritic, epicurean, extravagance, weakness, fun-loving, for fun, for a laugh
Entry:evil
Synonyms:the Devil, satanism, black mass, the forces of darkness/evil, satanic, Old Nick, horn, Satan
Entry:two-edged
Synonyms:mixed, patchy, spotty, mixed blessing, six of one, (and) half a dozen of the other, a double-edged/two-edged sword, work both ways, the rights and wrongs of something, cut both ways
Using the thesaurus
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feeling pleased and satisfied
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Explanation: