Answer:
The correct answer is option (D) Profits earned in the domestic economy are counted as part of GDP under the resource cost-income approach.
Explanation:
Solution
Gross domestic product (GDP) refers to sum of all value of goods and services manufactured within the geographical border of the country.
Now the investment for plant in carried within the geographical borders of The United States so it will include in GDP as gross domestic capital formation.
Thus the construction of the plant will cause a rise in U.S GDP.
Now this plant produce profit of $250000. profit produced within the economy so it will include in GDP.
These profit will increase US GDP since profits gained in the domestic economy are counted as a part of GDP under the resource cost or operating in income approach.
XminusIndustries manufactures 3minusD printers. For each unit, $ 2 comma 800 of direct material is used and there is $ 1 comma 900 of direct manufacturing labor at $ 20 per hour. Manufacturing overhead is applied at $ 25 per direct manufacturing labor hour. Calculate the profit earned on 52 units if each unit sells for $ 9 comma 200.
Answer:
the profit earned on 52 units is $110,500
Explanation:
Profit = Sales - Cost of Sales
First determine the cost of sales
Hint : Prepare a manufacturing cost schedule
Direct Materials ($ 2,800 × 52 units) = $145,600
Direct Labor ($ 1,900 × 52 units) = $98,800
Manufacturing Overheads ($25 × 95 hours × 52 units) = $123,500
Total Cost =$367,900
Then determine the Profit
Sales ($9,200 × 52 units) = $478,400
Less Cost of manufacture = ($367,900)
Net Income / (Loss) = $110,500
Conclusion :
Calculate the profit earned on 52 units is $110,500
Titanic Roofing Company has estimated the following amounts for its next fiscal year: Total fixed costs $ 833 comma 000 Sale price per unit 60 Variable cost per unit 30 If the company spends an additional $ 30 comma 000 on advertising, sales volume would increase by 2 comma 500 units. Before the change, the company's sales level exceeds the breakeven point. What effect will this decision have on the operating income of Titanic? A. Operating income will decrease by $ 45 comma 000. B. Operating income will increase by $ 45 comma 000. C. Operating income will increase by $ 75 comma 000. D. Operating income will increase by $ 150 comma 000.
Answer: B. Operating income will increase by $ 45,000
Explanation:
Total fixed cost = $833,000
Sale price per unit = 60
Variable cost per unit = 30
Advertising = $30,000
Increase in sales volume = 2500
The contribution margin is the difference between the sales price per unit and the variable cost per unit.
= 60 - 30
= 30
Therefore, Hence the increase in the contribution margin will be:
= ($30 × 2500)=$75000
We then subtract the additional cost of $30,000 from $75,000. This will be:
= $75,000 - $30,000
= $45,000
Therefore, operating income will increase by $45,000
Sunland Company applies overhead on the basis of 200% of direct labor cost. Job No. 501 is charged with $320000 of direct materials costs and $410000 of manufacturing overhead. The total manufacturing costs for Job No. 501 is $1140000. $1050000. $935000. $730000.
Answer:
$935,000
Explanation:
Calculation for Sunland company total manufacturing costs for Job No. 501
Using this formula
Total Manufacturing cost =(Manufacturing Overhead/Percentage of Overhead basis)+Direct material +Manufacturing overhead
Let plug in the formala
Total Manufacturing Overhead=($410,000/2)= $205,000 + $320,000 + $410,000
Total Manufacturing overhead =$935,000
Therefore Sunland company total manufacturing costs for Job No. 501 will be $935,000
Your uncle is about to retire, and he wants to buy an annuity that will provide him with $75,000 of income a year for 20 years, with the first payment coming immediately. The going rate on such annuities is 5.25%. How much would it cost him to buy the annuity today
Answer:
The annuity will cost him $963,212.95.-
Explanation:
Giving the following information:
Cash flow= $75,000
Interest rate= 0.0525
n= 20
First, we need to calculate the final value. We will use the following formula:
FV= {A*[(1+i)^n-1]}/i + {[A*(1+i)^n]-A}
A= annual cash flow
FV= {75,000*[(1.0525^20) - 1]/0.0525} + {[75,000*(1.0525^20)] - 75,000}
FV= 2,546,491.88 + 133,690.82= $2,680,182.70
Now, the present value:
PV= FV/(1+i)^n
PV= 2,680,182.70/(1.0525^20)
PV= $963,212.95
O.K. Company uses a job order cost accounting system and allocates its overhead on the basis of direct labor costs. O.K. expects to incur $2,000,000 of overhead during the next period and expects to use 50,000 labor hours at a cost of $10.00 per hour. What is O.K. Company's overhead application rate
Answer:
Predetermined manufacturing overhead rate= $0.4 per direct labor dollar
Explanation:
Giving the following information:
O.K. expects to incur $2,000,000 of overhead during the next period and expects to use 50,000 labor hours for $10.00 per hour.
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 2,000,000/ (50,000*10)
Predetermined manufacturing overhead rate= $0.4 per direct labor dollar
Karen Wilson and Katie Smith are looking at the company's health care options and trying to determine how much their net pay will decrease if they sign up for the qualified cafeteria plan offered by the company. Karen, a married woman with four exemptions, earns $2,250 per biweekly payroll. Katie, a single woman with one exemption, also earns $2,075 per biweekly payroll. The biweekly employee contribution to health care that would be subject to the cafeteria plan is $115.
Required:
Compute the taxable income for Karen and Katie.
Karen’s taxable income if she declines to participate in the cafeteria plan: _____
Karen’s taxable income if she participates in the cafeteria plan: _____
Katie’s taxable income if she declines to participate in the cafeteria plan: _____
Katie’s taxable income if she participates in the cafeteria plan:______
Answer:
Without cafeteria plan Karen taxable income is 2250 dollars and with cafeteria plan the taxable income is $2135.
Without cafeteria plan Katie taxable income is 2075 dollars and with cafeteria plan the taxable income is $1960.
Explanation:
A married women Karen earns = $2250
Katie single women earn = $2075
Employee contribution to health care = $115
If the Karen decline to participate in the cafeteria then her taxable income is $2250 (wages).
If the Karen accept to participate in the cafeteria then her taxable income is $2250 - $115 (contribution) = $2135
If Katie declined to participate in the cafeteria then her taxable income is $2075 (wages).
If Katie accept to participate in the cafeteria then her taxable income is $2075 - $115 (contribution) = $1960
Zaid's Tent Company has total fixed costs of $300,000 per year. The firm's average variable cost is $65 for 10,000 tents. At that level of output, the firm's average total costs equal Group of answer choices $65 $75 $85 $95
Answer:
$95
Explanation:
average variable cost per unit = $65
average fixed cost per unit = $300,000 / 10,000 = $30
average total cost per unit = $95
Fixed costs do not vary if the production output changes, while variable costs move in the same direction as the production output, e.g. if output increases, variable costs increase as well.
Sensitivity analysis determines the: Multiple Choice net present value range that can be realized from a proposed project. degree to which a project relies on its initial costs. ideal ratio of variable costs to fixed costs for profit maximization. range of possible outcomes given that most variables are reliable only within a stated range. degree to which the net present value reacts to changes in a single variable.
Answer:
It determines the degree to which the net present value reacts to changes in a single variable
Explanation:
Sensitivity Analysis is a tool which is used in financial modeling to analyze how the net values of a set of independent variables affect a single dependent variable under certain specific conditions.
It shows how different values of the independent variable causes changes in the single dependent variable. It predicts the result of a decision given a certain range of variables.
GDP would include all of the following except:
a. income earned for engineering services.
b. income earned by an airline pilot.
c. tips earned but not reported by a waitress at an upscale restaurant.
d. the purchase of a new automobile by a school.
e. the purchase of a new home by a retired couple.
Answer:
The correct answer is the option C: tips earned but not reported by a waitress at an upscale restaurant.
Explanation:
To begin with, the Gross Domestic Product or GDP comprehends in economic terms the monetary measure of the market value of all the final goods that an economy produces in a certain amount of time. Moreover, this measure is formed by different variables that are the consumption, investment, government spending and net exports. And in that scenario, all the of the cases presented will be included in the GDP of the economy except the tips that are not reported due to the fact that those earnings will figured as out of the circular flow of economy as it will represent a leak, a filtration of the system.
Answer:
The correct answer is C
Use the information below to answer the following questions. U.S. $ EQUIVALENT CURRENCY PER U.S. $ Polish Zloty .2994 3.3406 Euro 1.2456 .8028 Mexican Peso .0752 13.2998 Swiss Franc 1.0352 .9660 Chilean Peso .002071 482.80 New Zealand Dollar .8080 1.2376 Singapore Dollar .8004 1.2494 a. If you have $275, how many Polish zloty can you get
Answer:
Explanation:
US $ = .2994
Polish Zloty = 3.3406 / US$
US $ = 1.2456
Euro = .8028 / US$
US$ = .0752
Mexican Peso = 13.2998 / US$
US$ = .9660
Swiss Franc = 1.0352 / US$
Us $ = -002071
Chilean Peso = 482.8/US$
US$ = .8080
New Zealand dollar = 1.2376 / US$
US $ = .8004
Singapore dollar = 1.2494/US$
$275 =
Workings
If $ 0.2994 = 3.3406 Polish zloty / US$
Using direct conversion by multiplication
Therefore $275 = 275 * 3,3406
= Polish Zloty 918.67
Indicate what components of GDP (if any) each of the following transactions would affect. Check all that apply.
a. Uncle Paul pays a domestic contractor for renovating his home.
b. Aunt Jane buys a new house from a local builder.
c. You purchase a box of Belgium chocolate.
d. Ford manufactures a Focus and sells it to Avis, the car rental company.
e. You pay a domestic plumber for fixing a leak in your bathroom.
f. Ford sells a Mustang from its inventory to the Martinez family.
g. California hires workers to repave Highway 101.
h. The federal government sends your grandmother a Social Security check.
1. Consumption
2. Investment
3. Government Purchases
4. Net Exports
Answer and Explanation:
As we know that
Gross domestic product = Consumption + Investment + Government purchase + Net exports
where,
Net exports = Exports - imports
a. Uncle Paul pays a domestic contractor to have his house renovated. = Consumption
b. Aunt Jane buys a new house from a nearby building firm. = Investment
c. You buy chocolate from Belgium in a box. = Consumption & net exports
d. Ford is making a Focus and marketing it to Avis, the car rental company. = Investment
To fix a leak in your bathroom you pay a domestic plumber. = Consumption
e. Ford is selling a Mustang to the Martinez family from its inventory. = Consumption and investment
f. California is hiring people to repave Highway 101. = Government purchase
g. The Federal government is sending a Social Security check to your grandmother. The same is not involved in GDP as it has transfer payment
According to the conditions, Uncle Paul pays a domestic contractor for renovating his home - Consumption. Thus, the correct transactions that affect a-1, b-2, c-1&4, d-2, e-1, f-1&2, g-3, h-No affect.
Utilizing resources to fulfill present needs and desires is referred to as consumption. In contrast, investing is making purchases in order to generate future revenue.
An asset is considered an investment if it is bought or invested in with the intention of increasing financial security and preserving hard-earned income.
Government purchases are things that the federal, state, and municipal governments spend money on.
The difference between a country's exports and imports in dollars over a specific time period is known as net exports.
Therefore, the following transactions with their effect are as follows:
a-1, b-2, c-1&4, d-2, e-1, f-1&2, g-3, h-No affect.
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Huprey Co. is the defendant in the following legal claims. For each of following claims, does Huprey (a) record a liability, (b) disclose in notes, or (c) have no disclosure. 1. Huprey can resonably estimate that a pending lawsuit will result in damages of $1,280,000it is probable that Huprey will lose the case. Have no disclosure. Record a liability. Disclose in notes. 2. It is reasonably possible that Huprey will lose a pending lawsuit. The loss cannot be estimable. Have no disclosure. Disclose in notes. Record a liability. 3. Huprey is being sued for damages of $2,400,000. It is very unlikely (remote) that Huprey will lose the case. Have no disclosure. Record a liability. Disclose in notes. rev: 02_07_2018_QC_CS-117158
Answer:
1. Huprey can resonably estimate that a pending lawsuit will result in damages of $1,280,000, it is probable that Huprey will lose the case.
Record a liability.2. It is reasonably possible that Huprey will lose a pending lawsuit. The loss cannot be estimable.
Disclose in notes.3. Huprey is being sued for damages of $2,400,000. It is very unlikely (remote) that Huprey will lose the case.
Have no disclosure.Explanation:
Contingent liabilities must be recorded only when it is probable that the liability will happen and you can estimate the associated costs.
When contingent liabilities are only reasonably possible or you cannot estimate the amount, they must be included in the footnotes of the financial statements.
When contingent liabilities are not reasonably possible, nothing needs to be disclosed.
Consider the demand for Russian rublesRussian rubles in exchange for British poundsBritish pounds. Which of the following will not increase the foreign currency demand for the rubleruble? A. Currency traders who believe that the value of the rubleruble in the future will be less than its value today. B. Foreign firms and consumers who want to buy goods and services from RussiaRussia. C. Currency traders who believe that the value of the rubleruble in the future will be greater than its value today.
Answer: A. Currency traders who believe that the value of the ruble in the future will be less than its value today.
Explanation:
In the foreign exchange market, currencies are traded at different prices. From the options given in the question, the correct option is option A (Currency traders who believe that the value of the rubleruble in the future will be less than its value today).
When the currency traders believe that the value of the rubel is going to depreciate in the future, they will start selling the rubels and this will lead to a decrease in the demand for it because it will depreciate. Here, the supply will increase but the demand will reduce.
Mrs. Lu is turning 65 in November and called to ask for your help deciding on a Medicare Advantage plan. She agreed to sign a scope of appointment form and meet with you on October 15. During the appointment, what are you permitted to do
Answer:
I may provide her with the required enrollment materials and take her completed enrollment application
Explanation:
Since Mrs. Lu called to asked for my help in deciding on a Medicare Advantage plan in which She agreed to sign a scope of appointment form, this means when we finally meet for the appointment which was schedule for October 15 which is a month before her 65 birthday (November), I may provide her with all the required, important and necessary enrollment materials in which after she might have completed the enrollment materials i gave to her , I will collect the completed enrollment application from her for further processing.
Noland Company manufactures two models of its banjo, the Basic and the Luxury. The Basic model requires 10000 direct labor hours and the Luxury requires 30000 direct labor hours. The company produces 3400 units of the Basic model and 600 units of the Luxury model each year. The company inspects one Basic for every 100 produced, and inspects one Luxury for every 10 produced. The company expects to incur $1457000 of total inspecting costs this year. How much of the inspecting costs should be allocated to the Basic model using ABC costing
Answer:
Allocated inspection overhead= $527,000.
Explanation:
Activity-based costing is a form of absorption costing where overheads are charged to product using cost drivers.
Under this method, overheads are first analyzed and categorized by the activities responsible for them and then charged to product based on the amount of benefits enjoyed using cost drivers.
Activity rate per driver is calculated as:
Activity overhead for the period / Total cost drivers for the period
Number of inspection :
Basic model = 3400/100 = 34
Luxury model = 600/10= 60
Total inspection = 94 inspections
Inspection cost per inspection = $1457000/94= 15,500 inspections
Inspection to Basic model = 15,500 × 34 = $527,000.
Allocated inspection overhead= $527,000.
For each of the following separate transactions: Sold a building costing $38,500, with $23,400 of accumulated depreciation, for $11,400 cash, resulting in a $3,700 loss. Acquired machinery worth $13,400 by issuing $13,400 in notes payable. Issued 1,340 shares of common stock at par for $2 per share. Note payables with a carrying value of $41,700 were retired for $50,400 cash, resulting in a $8,700 loss. (a) Prepare the reconstructed journal entry. (b) Identify the effect it has, if any, on the investing section or financing section of the statement of cash flows.
Answer:
Both requirements are solved below
Explanation:
REQUIREMENT A:
Sale of a building Debit Credit
Cash $11,400
Acc Depreciation $23,400
Loss on disposal $3700
Building $38,500
Acquisition of Machinery Debit Credit
Machinery $13,400
Notes $13,400
Issuance of share Debit Credit
Cash(1340x2) $2,680
Share Capital $2,680
Retired Debt Debit Credit
Note payable $41,700
Loss on retirement $8,700
Cash $50,400
REQUIREMENT B:
Cash flow from investing activities
Gain on disposal of building $11,400
Net cash flow from investing activities $11,400
Cash flow from financing activities
Cash received from issuing shares $2,680
Cash paid for retirement of debt ($50,400)
Net cash flow from investing activities ($47,720)
The Boxwood Company sells blankets for $ 37.00 each. The following was taken from the inventory records during May. The company had no beginning inventory on May 1. Date Product Z Units Cost May 01 Purchase 7 $15.00 May 10 Sale 5 May 17 Purchase 10 $16.00 May 20 Sale 8 May 23 Sale 3 May 30 Purchase 12 $24.00 Assuming that the company uses the perpetual inventory system, determine the cost of goods sold for the sale of May 20 using the FIFO inventory cost method.
Answer:
$128
Explanation:
The FIFO inventory system means first in , first out. It means that it is the first purchased inventory that is the first to be sold.
Under the perpetual system, the cost of goods sold Under the FIFO system would be taken from the most recent inventory purchase prior to the sale.
The most recent inventory purchase prior to the sale occurred on the 17th. The price at which the inventory was purchased on the 17th would be used to calculate the cost of goods sold
So the cost of goods sold = $16.00 × 8 = $128
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A company issues 6%, 7-year bonds with a par value of $280,000 on January 1 at a price of $296,367, when the market rate of interest was 5%. The bonds pay interest semiannually. The amount of each semiannual interest payment is:
Answer:
Interest payment per coupon = $8,400
Explanation:
Journal entry to record the bond issuance:
January 1, 202x, bonds are issued
Dr Cash 296,367
Cr Bonds payable 280,000
Cr Premium on bonds payable 16,367
assuming straight amortization for the bond premium:
amortization of bond premium per coupon payment = $16,367 / 14 = $1,169.07
Journal entry to record payment of coupons:
July 1, 202x
Dr Interest expense 7,230.93
Dr Premium on bonds payable 1,169.07
Cr Cash 8,400
The following information is available for Quality Book Sales's sales on account and accounts receivable:
Accounts Receivable Balance, January 1, Year 2 $ 78,500
Allowance for Doubtful Accounts, January 1, Year 2 4,710
Sales on Account, Year 2 550,000
Collections of Accounts Receivable, Year 2 556,000
After several collection attempts, Quality Book Sales wrote off $2,850 of accounts that could not be collected. Quality Book Sales estimates that 0.5 percent of sales on account will be uncollectible.
Required
Compute the following amounts:
(1) Using the allowance method, the amount of uncollectible accounts expense for Year 2.
(2) Net realizable value of receivables at the end of Year 2.
Answer:
1) Amount of uncollectible accounts expenses is $ 2,750
2) Net realizable value of receivables at the end of Year 2 is $65,040
Explanation:
Accounts Receivable Balance, January 1, Year 2 = $ 78,500
Allowance for Doubtful Accounts, January 1, Year 2 = $4,710
Sales on Account, Year 2 = $550,000
Collections of Accounts Receivable, Year 2 = $556,000
1) Amount of uncollectible accounts expenses = $550,000 ×0.5% = $ 2,750
2) Allowance for doubtful accounts, beginning balance = $4,710
Less: Write off = $ -2,850
Add: Uncollectible accounts expense for the year = $2,750
Allowance for doubtful accounts, ending balance = $4,610
Accounts receivable, Beginning balance =$78,500
Add: Credit sales = $550,000
Less: Collections = $-556,000
Less: Write off = $-2,850
Accounts receivable, Ending balance = $69,650
Accounts receivable, Ending balance = $69,650
Less: Allowance for doubtful accounts, ending balance = $-4,610
Net realizable value = $65,040
If after several collection attempts, Quality Book Sales wrote off $2,850 of accounts that could not be collected. Quality Book Sales estimates that 0.5 percent of sales on account will be uncollectible.
Using the allowance method, the amount of uncollectible accounts expense for Year 2 will be $2,750Net realizable value of receivables at the end of Year 2 will be $65,0401) Uncollectible account expense
Uncollectible account expense = $550,000×0.5%
Uncollectible account expense= $2,750
2) Net realizable value
First step is to calculate the ending account receivable
Ending account receivable = $78,500+$550,000-$556,000-$2,850
Ending account receivable=$69,650
Second step is to calculate the ending allowance for doubtful accounts
Ending allowance for doubtful accounts =$4,710+$2,750-$2,850
Ending allowance for doubtful accounts=$4,610
Now let determine the Net realizable value using this formula
Net realizable value=Ending account receivable-Ending allowance for doubtful accounts
Let plug in the formula
Net realizable value =$69,650 -$4,610
Net realizable value =$65,040
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6. What aggregate planning difficulty that might confront an organization offering a variety of products and/or services would not confront an organization offering one or a few similar products or services
Explanation:
Aggregate planning can be defined as a marketing tool whose objective is to develop a 6 to 18 month plan for the organizational production process, in order to plan in advance the need for the amount of materials and resources that a company needs to have in each period time, so costs are reduced.
Some aggregate planning decisions involve the amount of subcontracting items, the amount of outsourcing, overtime hours, the amount of inventory to be maintained and to be accumulated in a certain period, etc.
Aggregated planning helps the organization to meet demand and supply in a period of time, and it is also possible to be an instrument of influence on supply and demand, so an organization that offers a variety of products and / or services could face difficulties management of all the variables necessary for the production of varied items, as this planning takes time, affects costs, customer satisfaction, synchronization of the supply chain, etc.
Alden Co.’s monthly unit sales and total cost data for its operating activities of the past year follow. Management wants to use these data to predict future fixed and variable costs.
Month Units Sold Total Cost Month Units Sold Total Cost
1 318,000 $155,500 7 362,000 $292,624
2 163,000 99,250 8 268,000 149,750
3 263,000 203,600 9 76,400 67,000
4 203,000 98,000 10 148,000 128,625
5 288,000 199,500 11 92,000 92,000
6 188,000 110,000 12 98,000 83,650
Estimate both the variable costs per unit and the total monthly fixed costs using the high-low method. (Do not round intermediate calculations.)
Answer:
Alden Co.
Prediction of Future Fixed and Variable Costs, using the high-low method:
a) Determination of the Variable Cost:
7 362,000 $292,624
9 76,400 $67,000
285,600 $225,624
Variable cost per unit = $225,624/285,600 = $0.79
Fixed Costs = $76,000 - (76,400 x $0.79) = $15,644
Explanation:
Month Units Sold Total Cost
1 318,000 $155,500
2 163,000 99,250
3 263,000 203,600
4 203,000 98,000
5 288,000 199,500
6 188,000 110,000
7 362,000 292,624
8 268,000 149,750
9 76,400 67,000
10 148,000 128,625
11 92,000 92,000
12 98,000 83,650
The High-Low Method of determining costs can be relatively accurate if the highest and lowest activity levels represent the overall cost behavior of the company. Inaccurate results will be obtained when the two extreme activity levels are significantly unrepresentative of the dataset. This is exactly the case in this example. If you try to estimate fixed cost, at another activity level, you will get a different result. So the high-low method is not ideal in most cases and its results should not be relied on solely. A better method is to do a regression analysis with the dataset to obtain a more accurate result.
On August 31,the balance sheet of La Brava Veterinary Clinic showed cash $9,000,Account receivable$1700,supplies $600,equipments $6000,account payable $3600,common stock $13,00 and retained earings $700. During september,the following transaction occur
1. paid $2900 cash for accounts payable
2. collected $1,300 of accounts receivable
3. purchased additional equipments for $2100,paying $800 in cash and the balance on account
4. recognized revenue of $7300 of which $1500 is collected in cash and balance due in october
5. declared and paid $400 cash dividend
6. paid salaries $1700 rent for september $900,and advertising expense $200
7. Incurred utilities expense for month on account $170
8. Received $10,000 from capital bank on 6 month note payable
a. prepare a tabular analysis of september transactions begin with august 31 balances.column headings: cash,account receivable,supplies,equipments,account payable,common stock,retain earnings with separate column for revenues,expenses,dividends.Including margin explanation changes in retain earnings. Revenue is called Service Revenueb. prepare an income statements for september,a retained earnings statements for september,and a balance sheet at september 30.
Answer:
Brava Veterinary Clinic
a) Tabular Analysis of September Transactions:
see attached.
b1) Income Statement for September:
Service Revenue $7,300
Expenses:
Salaries $1,700
Rent 900
Advertising 200
Utilities 170 ($2,970)
Net Income $4,330
b2) Retained Earnings Statements for September
Net Income $4,330
Beginning Retained Earnings $700
Dividends ($400)
Ending Retained Earnings $4,630
b3) Balance Sheet at September 30:
Assets:
Cash $14,900
Accounts Receivable 6,200
Supplies 600
Equipment 8,100
Total Assets $29,800
Liabilities + Equity:
Accounts Payable $12,170
Common Stock 13,000
Retained Earnings 4,630
Total Liabilities + Equity $29,800
Explanation:
Financial Statements (Income Statement and Balance Sheet) are prepared at the end of a period to show the financial performance (Net Income) and the financial position (Assets = Liabilities + Equity) of a business entity.
A tabular statement of transactions illustrates the changes that have taken place during the period as a result of transactions. Transactions affect the Assets and Liabilities and Equity equally. The excess of revenue over expenses gives a net income.
Answer:
For a better visualization of the answer the first point was attached as an image.
Income Statement
Sales Revenues 7300
Salaries expense (1700)
Rent Expense (900)
Advertising Expense (200)
Utilities expense (170)
Net Income 4,330
Retained Earnings
Beginning 700
Income 4,330
Dividends (400)
Ending 4,630
Balance Sheet
Cash 14,900
Account Receivables 6,200
Supplies 600
Current 21,700
Equipment 8,100
Total Assets 29,800
Liablities
Account Payable 2,170
Note Payable 10,000
Total Liabilities 12,170
Equity
Common Stock 13,000
Retained Earnings 4,630
Total Equity 17,630
Total Liabilities + Equity 29,800
Explanation:
The dividends paid are not considered an expense.
We consider revenues and expense using the accrual basis rather than cash basis so we also recognize accrued expense (utilities ) and accrued revenues (sales which weren't paid right away)
For the Balance sheet the equipment is considered long.temr asset as their usefil life exceed a year.
The note payable while it is different from account payable is also a current liaiblity as it is due within the one-uyear window.
A building with a book value of $54,000 is sold for $63,000 cash. Using the indirect method, this transaction should be shown on the statement of cash flows as an increase of a.$63,000 from investing activities and a deduction from net income of $9,000 b.$9,000 from investing activities c.$54,000 from investing activities d.$54,000 from investing activities and an addition to net income of $9,000
Answer:
Increase of $63,000 from investing activities
and a deduction from net income of $9,000
Explanation:
The sales and purchase of assets fall under the investing activities. However the profit or loss realized from such transaction would have increased or decreased the net income as the case may be . Therefore this item of profit or loss which do not represent cash flow would be adjusted on the net income accordingly.
Profit on sale of building = 63,000 - 54,000 = $9,000
The transaction would be shown on the statement of cash flow as follows:
Net income
Less profit on sales of asset (9,000)
Investing activities:
add cash from Sale of asset 63,000
The entries are summarized below:
Increase of $63,000 from investing activities
and a deduction from net income of $9,000
On January 15, the end of the first pay period of the year, North Company’s employees earned $26,000 of sales salaries. Withholdings from the employees’ salaries include FICA Social Security taxes at the rate of 6.2%, FICA Medicare taxes at the rate of 1.45%, $2,000 of federal income taxes, $429 of medical insurance deductions, and $180 of union dues. No employee earned more than $7,000 in this first period. Prepare the journal entry to record North Company’s January 15 salaries expense and related liabilities.
Answer: Please see the explanation column
Explanation:
Journal entry to record North Company’s salaries expense and related liabilities.
Date Particulars Debit Credit
Jan, 15 Sales salaries expense $26,000
To FICA Social Security taxes
payable at 6.2% $1,612
To FICA Medicare taxes
payable at 1.45% $377
To federal income taxes payable $2,000
To employee medical insurance payable $429
To employee union dues payable $180
Sales Salaries Payable $21.402
Working :
FICA Social Security taxes = 6.2% x $26,000 = $1,612
FICA Medicare taxes = 1.45% x 26,000 = $377
Salary payable =Sales salaries expense -(FICA Social Security taxes payable + FICA Medicare taxes payable + federal income taxes payable+medical insurance payable +employee union dues payable ) = 26,000 - (1612+377+2000+429+180)=$21,402.
DS Unlimited has the following transactions during August. August 6 Purchases 78 handheld game devices on account from GameGirl, Inc., for exist240 each, terms 1/10, n/60. August 7 Pays exist440 to Sure Shipping for freight charges associated with the August 6 purchase. August 10 Returns to GameGirl eight game devices that were defective. August 14 Pays the full amount due to GameGirl. August 23 Sells 58 game devices purchased on August 6 for exist260 each to customers on account. The total cost of the 58 game devices sold is exist14, 145.37. Required: Record the transactions of DS Unlimited, assuming the company uses a perpetual inventory system. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Round your answers to 2 decimal places.)
Answer:
August 6
DR Inventory $18,720
CR Accounts Payable $18,720
(To record purchase of goods for sale)
= 76 devices * $240
= $18,720
August 7
DR Inventory $440
CR Cash $440
(To record shipping costs of Inventory)
August 10
DR Accounts Payable $1,920
CR Inventory $1,920
(To record Purchase returns)
August 14
DR Accounts Payable $16,800
CR Inventory $168
CR Cash $16,632
(To record payment of purchases)
Working
Accounts Payable = Purchases - Returns
= 18,720 - 1,920
= $16,800
Inventory
Goods were purchased terms 1/10 meaning a 1% discount is goods paid for in 10 days.
= 1% * 16,800
= $168
August 23
DR Accounts Receivable $15,080
CR Sales Revenue $15,080
(To record sales of goods on account)
Sales Revenue = 58 devices * 260
= $15,080
August 23
DR Cost of Goods Sold $14,145.37
CR Inventory $14,145.37
(To record cost of Goods sold)
Carillo Industries collected $105,000 from customers in 2017. Of the amount collected, $25,300 was for services performed in 2016. In addition, Carillo performed services worth $41,900 in 2017, which will not be collected until 2018. Carillo Industries also paid $73,800 for expenses in 2017. Of the amount paid, $30,200 was for expenses incurred on account in 2016. In addition, Carillo incurred $41,400 of expenses in 2017, which will not be paid until 2018. A) Compute 2014 cash-basis net income. B) Compute 2014 accrual-basis net income.
Answer:
A. Cash-basic net income $31,200
B.Accrual-basis net income$38,800
Explanation:
A)Computation of 2017 Carillo Industries cash-basis net income
Cash received from revenue$105,000
Less Cash paid for expenses$73,800
Cash-basic net income $31,200
B)Compututation of Carillo Industries 2017 accrual-basis net income
Revenues$121,600
(79,700+$41,900)
Less Expenses$82,800
($41,400 +$41,400)
Accrual-basis net income$38,800
Calculation for Revenue
$105,000-$25,300
=$79,700
Identify some common miscellaneous itemized deductions and identify any limitations that are imposed on the deductibility of these items. One itemized deduction allowed is for medical expenses. In what cases are medical insurance premiums paid by an individual not deductible as qualified expenses
Answer:
The answer is below
Explanation:
Itemized deductions is an auditing or accounting terms, that describes the various expenses that are deducted from the adjusted gross income to reduce the taxable income of an individual or the corporations. For example, job search expenses, mileage expenses, charitable expenses, and etc.
Some common miscellaneous itemized deductions are:
1. Job search expenses: these are deductible from Adjusted Gross Income (AGI) such as travel expenses, resume preparation costs, moving costs, etc.
2. Mileage expenses: mileage expenses is allowed by Internal Revenue Services (IRS) to be deducted from Adjusted Gross Income (AGI) for example; payments, repairs, insurance, etc.
3. Charitable expenses: Charitable expenses are also eligible to deduct from Adjusted Gross Income (AGI) e.g. charitable gifts, donations, etc.
Limitations imposed on items which are deductible
Regardless, if it is job search expenses, mileage expenses, or charitable expenses, all are deductible if they are eligible for the deduction, and according to the IRS, the eligibility criteria are that all the expenses must exceed the 2% of AGI (Adjusted gross income).
Cases in which medical expenses are not deductible
Given that an individual or company pay the amount of medical expenses from their pocket, not from the business cost, hence, in this case, medical insurance is not deductible from the AGI.
At the same time, the insurance premium is excluded for the deduction if they exceed from the fixed amount set by the IRS, therefore, the employer-paid insurance funds cannot be deducted.
Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year.
Item cost $ 10.00 Standard deviation of weekly demand 25 per week
Order cost $ 250.00 Lead time 1 week
Annual holding cost (%)33 % of item cost Service probability 95 %
Annual demand 25,750
Average demand 515 per week
a. Determine the order quantity and reorder point. (Round your answers to the nearest whole number.)
Optimal order quantity units
Reorder point units
b. Determine the annual holding and order costs. (Round your answers to 2 decimal places.)
Holding cost $
Ordering cost $
c. If a price break of $50 per order was offered for purchase quantities of over 2,000, what would be the annual savings? (Round your answer to 2 decimal places.)
Answer: The answer is below...
Explanation: Answer a. Order Quantity = √2RO/C = √2 * 25750 * 250 / .33 * 10 = √1975.23 From the standard normal distribution, z = 1.64 = (515 * 1) + (1.64 * 25) = 556 Reorder point = Lead time * daily usage = 7 * 25 = 150 per week Answer b. Holding cost = Q/2 (H) = 1975/2 (.33)10 = $3,258.75 Ordering cost...
Fill in the missing numbers for the following income statement. (Do not round intermediate calculations.)
Sales $668,600
Cost 431,300
Depreciation 103,700
EBIT
Taxes (24%)
Net Income
a. Calculate the OCF. (Do not round intermediate calculations.)
b. What is the depreciation tax shield?
Answer:
a. $205,236
b. $24,888
Explanation:
a. The computation of OCF is shown below:-
EBIT = Sales - Cost - Depreciation
= $668,600 - $431,300 - $103,700
= $133,600
Net income = EBIT - Taxes
= $133,600 - ($133,600 × 24%)
= $133,600 - $32,064
= $101,536
Operating cash flow = EBIT - Taxes + Depreciation
= $133,600 - $32,064 + $103,700
= $205,236
b. The computation of depreciation tax shield is shown below:-
Depreciation tax shield = Depreciation × Tax
= $103,700 × 24%
= $24,888
A year ago, the IT team earned corporate-wide recognition for its performance. More recently, it has begun to experience some declines in its performance. They have missed the last three project deadlines and have experienced budget overruns. The team leader has encouraged the team members to reflect on and adjust their purpose. To turn around the
Answer: Reflexivity
Explanation:
Here is the complete question:
A year ago, the IT team earned corporate-wide recognition for its performance. More recently, it has begun to experience some declines in its performance. They have missed the last three project deadlines and have experienced budget overruns. The team leader has encouraged the team members to reflect on and adjust their purpose. To turn around the team's performance, the team lead is encouraging the team to show __________.
a. creativity
b. adherence to norms
c. OCBs
d. reflexivity
e. cohesion
Reflexivity simply means when individuals examine their own judgements, beliefs, and practices during a project or a research process and how their judgements, practices or beliefs may have influenced or impacted the research.
From the question, we are told that a year ago, the IT team earned corporate-wide recognition for its performance but recently, it has begun to experience some declines in its performance which has led to them missing the last three project deadlines and having experienced budget overruns.
To turn around the team's performance, the team lead is encouraging the team to show reflexivity. He wants them to look at what they've been doing earlier and what they're doing presently and make necessary adjustments regarding their judgements for the goals of the organization to be achieved.