Answer and Explanation:
The journal entries are shown below:
1) Journal entry
On Jan 2
No journal entry is required
On Jan 2
Cash $35100
Accumulated depreciation-Machine A $24400
To Gain on sale of machine A 4500
To Machine A 55000
(Being the sale of machine A is recorded)
2) Journal entry
On Jan 2
No journal entry is required
On Jan 2
Accumulated depreciation-Machine B 7860
Loss on disposal of machine B 7940
To Machine B 15800
(Being disposal of machine B is recorded)
The following are two independent situations. (a) On April 2, Maria Elston uses her JCPenney credit card to purchase merchandise from a JCPenney store for $1,600. On May 1, Elston is billed for the $1,600 amount due. Elston pays $500 on the balance due on May 3. Elston receives a bill dated June 1 for the amount due, including interest at 1% per month on the unpaid balance as of May 3. Prepare the entries on JCPenney Co.’s books related to the transactions that occurred on April 2, May 3, and June 1.
Answer:
1. April 2
Dr Accounts Receivable $1,600
Cr Sales Revenue $1,600
2. May 3
Dr Cash $500
Cr Accounts Receivable $500
3. June 1
Dr Accounts Receivable $11
Cr Interest Revenue [(1,600-500)*1%] $11
Explanation:
Preparation of the entries on JCPenney Co.’s books related to the transactions that occurred on April 2, May 3, and June 1.
1. April 2
Dr Accounts Receivable $1,600
Cr Sales Revenue $1,600
(Being To record the purchase of merchandise )
2. May 3
Dr Cash $500
Cr Accounts Receivable $500
(Being To record payment on the balance due )
3. June 1
Dr Accounts Receivable $11
Cr Interest Revenue [(1,600-500)*1%] $11
(Being to record Interest received )
Hardwig Inc. is considering whether to pursue a restricted or relaxed current asset investment policy. The firm's annual sales are expected to total $3,600,000, its fixed assets turnover ratio equals 4.0, and its debt and common equity are each 50% of total assets. EBIT is $150,000, the interest rate on the firm's debt is 10%, and the tax rate is 40%. If the company follows a restricted policy, its total assets turnover will be 2.5. Under a relaxed policy its total assets turnover will be 2.2.-Refer to the data for Hardwig Inc. If the firm adopts a restricted policy, how much lower would its interest expense be than under the relaxed policy?A) $8,418B) $8,861C) $9,327D) $9,818E) $10,309
Answer:
D) $9,818
Explanation:
This can be determined using the following 3 steps.
Step 1. Calculation of interest expense under a restricted policy
Sales = $3,600,000
Asset turnover = Sales/ Total assets = 2.5 .................. (1)
Substituting sales into equation (1) and solve for Total assets, we have:
$3,600,000/ Total assets = 2.5
Total assets = $3,600,000 / 2.5
Total assets = $1,440,000
Since Debt is 50% of Total assets, we therefore have:
Debt = 50% * Total assets = 50% * $1,440,000 = $720,000
Since the interest rate on the firm's debt is 10%, we have:
Interest expense under a restricted policy = 10% * Debt = 10% * $720,000 = $72,000
Step 2. Calculation of interest expense under a relaxed policy
Sales = $3,600,000
Asset turnover = Sales/ Total assets = 2.2 .................. (1)
Substituting sales into equation (1) and solve for Total assets, we have:
$3,600,000/ Total assets = 2.2
Total assets = $3,600,000 / 2.2
Total assets = $1,636,363.64
Since Debt is 50% of Total assets, we therefore have:
Debt = 50% * Total assets = 50% * $1,636,363.64 = 818,181.82
Since the interest rate on the firm's debt is 10%, we have:
Interest expense under a restricted policy = 10% * Debt = 10% * 818,181.82 = $81,818
Step 3. Calculation of difference between interest expense under a restricted policy and a relaxed policy
Difference between interest expenses = Interest expense under a restricted policy - Interest expense under a relaxed policy = $81,818 - $72,000 = $9,818
Therefore, the interest expense under a relaxed policy would be $9,818 lower than interest expense under the relaxed policy.
36) All of the following are true of the number of days' sales uncollected ratio except: A) Can be used for comparisons between current and prior periods. B) Reflects the liquidity of receivables. C) Is most effective in evaluating the cash sales of a company. D) Measures how much time is likely to pass before the current amount of accounts receivable is received in cash. E) Can be used for comparisons to other companies in the same industry.
Answer:
C) Is most effective in evaluating the cash sales of a company.
Explanation:
A number of days' sales uncollected ratio can be defined as a liquidity ratio that is typically used by investors and creditors to determine or ascertain the number of days left to obtain all account receivable. Thus, it measures the amount of days left for a debtor to pay a credit.
All of the following are true of the number of days' sales uncollected ratio;
I. Can be used for comparisons between current and prior periods.
II. Reflects the liquidity of receivables.
III. Measures how much time is likely to pass before the current amount of accounts receivable is received in cash.
IV. Can be used for comparisons to other companies in the same industry.
On December 10, POGP Company receives an order for 200 sweater vests and assigns Job 83 to the order. Review the Materials Requisition table to journalize the entry to record the addition of the materials to Work in Process. If an amount box does not require an entry, leave it blank.
Dec. 10 Work in Process
Materials Feedback
Think about the flow of costs incurred to do a job and the accounts affected by sales to customers.
On December 15, review the Time Ticket tables to journalize the entry to record the addition of direct labor to Work in Process for the period December 1 through December 15. If an amount box does not require an entry, leave it blank.
Dec. 15 Work in Process
Wages Payable FeedbackCorrect
On December 15, review the Time Ticket tables to journalize the entry to record the addition of factory overhead to Work in Process for the period December 1 through December 15. If an amount box does not require an entry, leave it blank.
Dec. 15 Work in Process
Factory Overhead FeedbackPartially correct
On December 21, Job 62 is completed. Review the Job Cost Sheets and your journal entries. Journalize the entry to move the associated costs to the finished goods account. If an amount box does not require an entry, leave it blank.
Dec. 21 Finished Goods
Work in Process FeedbackPartially correct
On December 22, 75 of the 100 sweaters from Job 62 are sold on account for $125 each. Journalize the following transactions:
a. The entry to record the sale.
b. The entry to record the transfer of costs from Finished Goods to Cost of Goods Sold.
If an amount box does not require an entry, leave it blank.
Dec. 22 Accounts Receivable
Sales
Dec. 22 Cost of Goods Sold
Finished Goods FeedbackPartially correct
On December 31, the last work day of the year for the knitters, review the Time Ticket tables to journalize the entry to record the addition of direct labor to Work in Process for the period December 16 through December 31. If an amount box does not require an entry, leave it blank.
Answer:
sorry no clue
Explanation:
Hyde Boats purchased machinery on January 1 at a list price of $295,000, with credit terms 3/10, n/30. Payment was made within the discount period. Hyde Boats paid $17,700 sales tax on the machinery, and paid installation charges of $3,900. Hyde Boats also paid $15,900 to pour a concrete base that was necessary to place the machinery in service.
What is the total cost of the new machinery?
A. $332.500
B. $323.650
C. $307.750
D. $319.750
Answer:
Total purchase price= $323,650
Explanation:
Giving the following information:
Purchase price= $295,000
Installation= $3,900
Concrete for installation= $15,900
The total cost of the machine includes the purchase price and all costs required to put it into operation. Taxes are part of the purchase cost.
First, we need to calculate the net cash discount:
Net discount= 295,000 * 0.03= $8,850
Now, the total purchase price:
Total purchase price= (295,000 - 8,850) + 17,700 + 3,900 + 15,900
Total purchase price= $323,650
Please match each of the following terms to the description of best fit.
a. Risk associated with price fluctuations caused by interest rate changes B.
b. This is the risk that a firm's cost of debt will fall and as a result reinvested coupon payments will earn less yield moving forward.
c. Risk that the Borrower will not make payments on time or in full D.
d. Coupon Payments typically follow a benchmark market rate E.
e. All of the yield is determined by the difference in the price of the bond and the par value F.
f. Can be assessed using the perpetuity formula
1. Interest Rate Risk
2. Reinvestment Risk
3. Default Risk
4. Floating rate bond
5. Zero Coupon Bond
6. Consol Bond
Answer:
1. Interest Rate Risk ⇒ Risk associated with price fluctuations caused by interest rate changes.
2. Reinvestment Risk ⇒ This is the risk that a firm's cost of debt will fall and as a result reinvested coupon payments will earn less yield moving forward.
3. Default Risk ⇒ Risk that the Borrower will not make payments on time or in full.
4. Floating rate bond ⇒ Coupon Payments typically follow a benchmark market rate.
5. Zero Coupon Bond ⇒ All of the yield is determined by the difference in the price of the bond and the par value.
6. Consol Bond ⇒ Can be assessed using the perpetuity formula.
On January 1, 2020, Castaway Corp. issued 5,000 shares of preferred stock ($15 par value) at $45 per share. Each share of preferred stock is redeemable at the option of the stockholder at $45 per share. On September 1, 2020, preferred shareholders holding 1,000 shares of preferred stock redeemed their stock.
The entry recorded by Castaway Corp. on September 1, 2020, would include the following:
A. No net change to stockholdersâ equity.
B. A decrease to retained earnings for $5,000.
C. A decrease to assets for $45,000.
D. No net change to preferred stock outstanding.
Answer: C. A decrease to assets for $45,000.
Explanation:
When shareholders redeem their stock, the company pays them for the redeemed stock at a certain price which in this case is $45.
The total cost of redemption is therefore:
= 45 * 1,000
= $45,000
The company uses cash to pay for this which is an asset. Assets will therefore reduce by $45,000 which is the amount of cash paid.
When adjusting accrual earnings to obtain cash flows from operations, A. an increase in Accounts Payable is added to determine cash flow from operations. B. it is not necessary to consider any changes to Accounts Payable. C. an increase in Accounts Payable is deducted to determine cash flows from operations. D. a decrease in Accounts Payable is added to determine cash flow from operations.
Answer: A. an increase in Accounts Payable is added to determine cash flow from operations.
Explanation:
We should note that accounts payable refer to the amounts that the company pays to its suppliers, therefore the sum of the the total amount that's owed to the suppliers will be shown on the balance sheet of the company as accounts payable.
Therefore, when adjusting accrual earnings to obtain cash flows from operations, an increase in accounts payable is added to determine cash flow from operations.
A company retires its bonds at 105. The face value is $100,000 and the carrying value of the bonds at the retirement date is $103,745. The issuer's journal entry to record the retirement will include a: Group of answer choices Credit to Premium on Bonds. Credit to Bonds Payable. Debit to Premium on Bonds. Credit to Gain on Bond Retirement. Debit to Discount on Bonds.
Answer: Debit to Premium on Bonds.
Explanation:
Face value of bond = $100000
Carrying value of bond = $103745
The issuer's journal entry to record the retirement will include a Debit to Premium on Bonds which will be in the value of ($103745 - $100000) = $3745.
"Dan Druff Shampoo has 1,000,000 shares of common stock authorized with a par of $1 per share, of which 500,000 shares are outstanding. When the market value was $9 per share, Druff issued a stock dividend by which for each ten shares held, one share was issued as a stock dividend. The par per share did not change. What entry did Druff record for this transaction?"
Answer:
Debit : Dividends $50,000
Credit : Cash $50,000
Explanation:
Dividend calculation = 500,000 shares x $1 x 1/10 = $50,000
To record the dividend, the following entry is made :
Debit : Dividends $50,000
Credit : Cash $50,000
Managers need to understand how information flows within the organization, how their organization interacts with other organizations, and how the various parts of the organization interact with one another.
True
False
The net income reported on the income statement for the current year was $315,153. Depreciation recorded on fixed assets and amortization of patents for the year were $32,591 and $11,136, respectively. Balances of current asset and current liability accounts at the end and at the beginning of the year are as follows: End Beginning Cash $42,620 $55,973 Accounts Receivable 128,573 109,672 Inventories 112,117 87,792 Prepaid Expenses 4,229 6,883 Accounts Payable (merchandise creditors) 51,294 73,397 What is the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method
Answer:
$296,205
Explanation:
Cash flows from operating activities
Net income $315,153
Add Depreciation expense $32,591
Add Amortization expense $11,136
Increase in Accounts Receivable ($18,901)
Increase in Inventories ($24,325)
Decrease in Prepaid Expenses $2,654
Decrease in Accounts Payable ($22,103)
Net Cash from Operating Activities $296,205
Therefore,
the amount of cash flows from operating activities reported on the statement of cash flows prepared by the indirect method is $296,205.
the path a product takes from product to final user is called what?
Answer:
distribution channel
Explanation:
A marketing channel consists of the people, organizations, and activities necessary to transfer the ownership of goods from the point of production to the point of consumption. It is the way products get to the end-user, the consumer; and is also known as a distribution channel.
Buffalo Corporation is authorized to issue 45,000 shares of $5 par value common stock. During 2020, Buffalo took part in the following selected transactions.
1. Issued 4,500 shares of stock at $48 per share, less costs related to the issuance of the stock totaling $6,300.
2. Issued 1,100 shares of stock for land appraised at $45,000. The stock was actively traded on a national stock exchange at approximately $49 per share on the date of issuance.
3. Purchased 530 shares of treasury stock at $46 per share. The treasury shares purchased were issued in 2016 at $43 per share.
Instructions:(a) Prepare the journal entry to record item 1.(b) Prepare the journal entry to record item 2.(c) Prepare the journal entry to record item 3 using the cost method.
Answer:
A
Dr Cash $209,700
Cr Paid-In-Capital in excess of par-common stock $187,200
Cr Common Stock $22,500
B. Dr Land $53,900
Cr Common Stock $5,500
Cr Paid-In-Capital in excess of par-common stock $48,400
C. Dr Treasury Stock $24,380
Cr Cash $24,380
Explanation:
A. Preparation of the journal entry to record item1
Dr Cash (4,500*$48-6,300) $209,700
Cr Paid-In-Capital in excess of par-common stock $187,200
($209,700-$22,500)
Cr Common Stock $22,500
(4,500*$5)
(Being to record common stock issued)
B. Preparation of the journal entry to record item 2
Dr Land (1,100*$49) $53,900
Cr Common Stock $5,500
(1,100*$5)
Cr Paid-In-Capital in excess of par-common stock $48,400
($53,900-$5,500)
(Being to record land puchased in exchange for common stock)
C. Preparation of the journal entry to record item 3 using the cost method
Dr Treasury Stock $24,380
(530*$46)
Cr Cash $24,380
(Being to record purchase of treasury stock)
Wildhorse Company expects to have a cash balance of $124,200 on January 1, 2022. These are the relevant monthly budget data for the first two months of 2022.
1. Collections from customers: January $191,700, February $394,200.
2. Payments to suppliers: January $108,000, February $202,500.
3. Wages: January $81,000, February $108,000. Wages are paid in the month they are incurred.
4. Administrative expenses: January $56,700, February $64,800. These costs include depreciation of $2,700 per month. All other costs are paid as incurred.
5. Selling expenses: January $40,500, February $54,000. These costs are exclusive of depreciation. They are paid as incurred.
6. Sales of short-term investments in January are expected to realize $32,400 in cash. Wildhorse Company has a line of credit at a local bank that enables it to borrow up to $67,500. The company wants to maintain a minimum monthly cash balance of $54,000.
Answer:
Answer is explained in the explanation section below.
Explanation:
We need to set up a cash budget for the Wildhorse Company in their first two months of the year 2022.
Company = Wildhorse
For the Two Months Ending February 2022
So, below is the Cash Budget:
January February
Beginning of Cash balance $124,200 $67500
Add: Receipts
Sale of Short Term Investments $32400 -
Collection from Customers $191700 $394200
Total Receipts $224100 $394200
Total Available Cash $348300 $461700
Less: Disbursements:
Wages $81000 $108000
Administrative Expenses $51300 $62100
($54000-$2700Dep.) ($64800-$2700Dep.)
Selling Expenses $40500 $54000
Payments to Suppliers $108000 $202500
Total Disbursements $280800 $426600
Excess or (Deficit) of Avble Cash $67500 $35100
Financing:
Add: Borrowings - $18900
Less: Repayments - -
Ending Cash Balance $67500 $54000
Explanation: As cash availability in February is only $ 35100, the company will borrow $18900 to maintain a minimum balance of $30,000.
Borrowing in February = Minimum Balance - Available Cash
Borrowing in February = $54000-$35100
Borrowing in February = $18900
Harvey Hotels has provided a defined benefit pension plan for its employees for several years. At the end of the most recent year, the following information was available with regard to the plan: service cost: $6.4 million, expected return on plan assets: $1.4 million, actual return on plan assets: $1.2 million, interest cost: $1.6 million, payments to retired employees: $2.2 million, and amortization of prior service cost (created when the pension plan was amended causing a drop in the projected benefit obligation): $1.3 million. What amount should Harvey Hotels report as pension expense in its income statement for the year
Answer:
$7.9 million
Explanation:
Calculation to determine What amount should Harvey Hotels report as pension expense in its income statement for the year
Service cost $6.4 million
Interest cost $1.6million
Expected return on plan assets($1.4million)
Amortization of prior service cost $1.3million
Pension expense $7.9million
Therefore The amount that Harvey Hotels Should report as pension expense in its income statement for the year is $7.9million
Consider this data for Marston Manufacturing Company and use it to complete the table:
Selected Financial Data for
Marston Manufacturing Company
Average cash $57,813
Average accounts payable $320,000
Average accounts receivable $1,387,500
Average inventories $693,750
Average cash sales $4,625,000
Average credit sales $13,875,000
Average cost of goods sold $8,325,000
Average number of days per year 365 days
Inventory conversion period 30.42 days
Payables deferral period days
Receivables conversion period
Operating cycle 66.92 days
Cash conversion cycle 52.89 days
Answer and Explanation:
The computation is shown below:
Payable Deferral Period = 365 ÷ Payable turnove ratio
where,
Payables Turnover Ratio = Average Cost of Goods Sold ÷ Average Accounts Payable
= ($8,325,000 ÷ $320,000)
= 26.02
Now payable deferral period is
= 365 ÷ 26.02
= 14.02 days
And, the receivables conversion period is
= 365 ÷ receivable turnover ratio
where
Receivables Turnover Ratio = Average credit sales ÷ Average Accounts receivable
= ($13,875,000 ÷ $1,387,500)
= 10
Now receivable turnover period is
= 365 ÷ 10
= 36.50 days
Your employer, Pointer Media Group of Columbus, Ohio, has had an excellent year, and the CEO, Jeremy Pointer, would like to reward the troops for their hard work with a rustic yet plush winter retreat. The CEO wants his company to host a four-day combination conference/retreat/vacation for his 55 marketing and media professionals with their spouses or significant others at some spectacular winter resort.
One of the choices is Vail, Colorado, a famous ski resort town with steep slopes and dramatic mountain views. As you investigate the options in Vail, you are captivated by the Four Seasons Resort and Residences Vail, a five-star property with an outdoor pool, indoor and outdoor hot tubs, ski-in/ski-out access, a ski concierge, two acclaimed gourmet restaurants, and an amply equipped gym and fitness center. Other amenities include an on-site spa with massage and treatment rooms, a sauna, and facial and body treatments. Bathrooms feature separate bathtubs and showers, double sinks, and bathrobes. For business travelers, the hotel offers complimentary wired high-speed Internet access, complimentary wireless Internet access, and multiline phones as well as the use of two desktop computers.
The website of the Four Seasons Resort and Residences Vail is not very explicit on the subject of business and event facilities, so you decide to jot down a few key questions. You estimate that your company will require about 50 rooms. You will also need two conference rooms (to A/V equipment in the conference rooms, Internet access, and entertainment options for families. You have two periods that would possible: December 16-20 or January 13-17, You realize that both are peak times, but you wonder whether you can get a discounted accommodate 25 participants or more) for one and a half days. You want to know about room rates, conference facilities, You are interested in entertainment in Vail, and in tours to the nearby national parks. Eagle County Airport is 36 miles away rou and you would like to know whether the hotel operates a shuttle. Also, one evening the CEO will want to host a banquet for about 85 people. Mr. Pointer wants a report from you by September 13.
Your Task: Write a well-organized direct request letter or e-mail to Kiersten Dunn, Sales Manager, Four Seasons Resort and Resi dences Vail, One Vail Road, Vail, Co 81657.
Answer:
Answer is explained in the explanation section below.
Explanation:
Solution:
28 February, 2021
Kiersten Dunn,
Sales Manager,
Four Seasons Resort and Residence Vail,
One Vail Road, Vail,
Co 81657
Subject: Information on 50 rooms and two conference halls that are required for a four-day official retreat.
Dear Kierstenn,
Our Columbus, Ohio-based business, Pointer Media Group, is planning an official retreat in Vail. We liked your property a lot and think it's a good match for our needs. We're looking for dates between December 16 and 20, 2018 and January 13 and 17, 2018. Please share your availability based on our requirements so that we can schedule the retreat.
The retreat will last for four days. There will be some official conference meetings followed by enjoyable activities at the retreat.
Kindly mention the details about your resort as follows:
Availability of 50 rooms and 2 conference halls on the designated date:
Seating capacity of the conference halls:
Room rates and packages offered:
Services offered:
Availability of A/V equipment in conference room:
Access to Internet:
Availability of DVD player/recreation facilities:
Mode of payment accepted:
Toiletries provided:
Corporate discount offered, if any:
We eagerly await your prompt response on this matter. If you need any additional details, please contact us.
Sincerely,
Lily Sethi
HR, Pointer Media Group
the aicpa code of professional conduct includes which sections
Answer:
The Code of Professional Conduct of the American Institute of Certified Public Accountants consists of two sections--(1) the Principles and (2) the Rules. The Principles provide the framework for the Rules, which govern the performance of professional services by members.
Explanation:
The four parts of the AICPA Code of Professional Conduct are principles, rules of conduct, interpretations of the rules of conduct and ethical rulings.
The three categories of members under the Code of Professional Conduct are 1) members in public practice; 2) members in business; and 3) other members.
LOL :)
The following information should be considered:
The Code of Professional Conduct of the American Institute of Certified Public Accountants consists of two sections:
The Principles And the Rules. The Principles provide the framework for the Rules, which govern the performance of professional services by members. The four parts of the AICPA Code of Professional Conduct are principles, rules of conduct, interpretations of the rules of conduct and ethical rulings. The three categories of members under the Code of Professional Conduct are members in public practice; members in businessother members.
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A combination of high crude oil prices and government subsidies for ethanol have led to a sharp increase in the demand for corn in recent years. How will this increase in demand for corn influence (a) the price of corn; (b) the quantity of corn supplied; (c) the cost of producing soybeans and wheat, crops that are often produced on land suitable for production of corn; (d) the price of cereals, tortillas, and other products produced from corn; and (e) the price of beef, chicken, and pork, meats produced from animals that are generally fed large quantities of corn
Answer:
a) Increase
b) Increase
c) Increase
d) Increase
e) Increase
Explanation:
a) The price of corn
The increase in the demand for corn will cause an increase in the price of corn
b) The quantity of corn supplied
The quantity of corn supplied will increase rapidly in the short run before equilibrium will be established in the market
c) The cost of producing soybeans and wheat crops will Increase due to the High demand for corn hence the supply will decrease as well
d) The price of cereals and other products produced from corn will Increase as well
e) The price of beef and other meat gotten from animals that fed on Corn will Increase as well because the cost of their feed will increase
Refer to SM1 Q2. Thomas has a ticket to go to a movie this Saturday. He was willing to pay $20, but he only paid $15 for it. After he bought the movie ticket his friend offered to take him out to dinner Saturday evening. Thomas has to choose between going for the movie or a free dinner. He can resell the ticket for $10. What is the lowest value that Thomas should place on the free dinner to make him choose the free dinner rather than the movie.
Answer:
$5 is the value for dinner.
Explanation:
Thomas has bought the movie ticket for $15. The movie ticket can be resell at a price of $10. His friend has asked him for free dinner but the dinner will cost him $5 since he will incur a loss of $5 on the movie ticket. The lowest value is the $5 for the dinner and the maximum value is $15 for the movie. Thomas can choose between two alternatives but will go towards the lowest value.
Park Corporation is planning to issue bonds with a face value of $3,100,000 and a coupon rate of 7 percent. The bonds mature in 10 years and pay interest semiannually every June 30 and December 31. All of the bonds were sold on January 1 of this year. Park uses the effective-interest amortization method and also uses a premium account. Assume an annual market rate of interest of 6.0 percent. (FV of $1, PV of $1, FVA of $1, and PVA of $1)
1. Prepare the journal entry to record the issuance of the bonds.
2. Prepare the journal entry to record the interest payment on June 30 of this year. What bonds payable amount will Park report on its June 30 balance sheet?.
Answer:
PV of bonds:
PV of face value = $3,100,000 / (1 + 3%)²⁰ = $1,716,395
PV of coupon payments = $108,500 x 14.877 (PVIFA, 3%, 20 periods) = $1,614,155
market price = $3,330,550
1) January 1, year 1
Dr Cash 3,330,550
Cr Bonds payable 3,000,000
Cr Premium on bonds payable 330,550
2) June 30, year 1
Dr Interest expense 99,916
Dr Premium on bonds payable 8,584
Cr Cash 108,500
amortization of bond premium = ($3,330,550 x 6%) - $108,500 = -$8,584
Waupaca Company establishes a $420 petty cash fund on September 9. On September 30, the fund shows $166 in cash along with receipts for the following expenditures: transportation-in, $53; postage expenses, $70; and miscellaneous expenses, $123. The petty cashier could not account for a $8 shortage in the fund. The company uses the perpetual system in accounting for merchandise inventory.
Prepare:
1) the September 9 entry to establish the fund.
2) the September 30 entry to reimburse the fund.
3) an October 1 entry to increase the fund to $450.
Answer:
Date Account Debit Credit
Sep 9 Petty cash $420
Cash $420
Sep 30 Merchandise inventory $53
Postage expense $70
Miscellaneous expense $123
Cash shortage $8
Cash $254
Oct 1 Petty cash $30
Cash [450-420] $30
An international trade summit is held in Geneva, Switzerland. The purpose of the summit is to cooperatively develop policies that promote international trade. Representatives from 50 different countries attend the summit. One of the attendees represents a leading nation in the international services trade. This attendee is most likely from which of the following countries?
a. New Zealand
b. Germany
c. Kenya
d. Saudi Arabia
Answer:
b. Germany
Explanation:
The international business summit held at Geneva was for the cooperation and development of trade policies. About 50 representatives from various nations were involved. Most of the members were from Germany. The summit discussed many trade issues and various national security policies for protection and growth of the business.How is paid wages and outstanding wages treated in accounting equation.
Answer:
Paid wages will reduce the net income as an expense. Net income becomes Retained earnings which are added to Equity. Paid wages will therefore reduce the Equity in the accounting equation.
Outstanding wages however, will be transferred to a liability account to show that the company owes those wages. This will therefore increase the liabilities in the accounting equation.
andy Bank, Inc., makes one model of wooden canoe. and, the information for it follows: Number of canoes produced and sold 450 650 800 Total costs Variable costs $ 63,000 $ 91,000 $ 112,000 Fixed costs $ 187,200 $ 187,200 $ 187,200 Total costs $ 250,200 $ 278,200 $ 299,200 Cost per unit Variable cost per unit $ 140.00 $ 140.00 $ 140.00 Fixed cost per unit 416.00 288.00 234.00 Total cost per unit $ 556.00 $ 428.00 $ 374.00 Sandy Bank sells its canoes for $375 each. Required: 1. Suppose that Sandy Bank raises its selling price to $500 per canoe. Calculate its new break-even point in units and in sales dollars. 2. If Sandy Bank sells 700 canoes, compute its margin of safety in dollars and as a percentage of sales. (Use the new sales price of $500.) 3. Calculate the number of canoes that Sandy Bank must sell at $500 each to generate $110,000 profit.
Answer:
Results are below.
Explanation:
To calculate the break-even point in units and dollars, we need to use the following formulas:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 187,200 / (500 - 140)
Break-even point in units= 520
Break-even point (dollars)= fixed costs/ contribution margin ratio
Break-even point (dollars)= 187,200 / (360 / 500)
Break-even point (dollars)= 187,200 / 0.72
Break-even point (dollars)= $260,000
Now, to calculate the margin of safety for 700 units, we need to use the following formulas:
Margin of safety= (current sales level - break-even point)
Margin of safety= (700*500) - 260,000
Margin of safety= $90,000
Margin of safety ratio= (current sales level - break-even point)/current sales level
Margin of safety ratio= 90,000 / 350,000
Margin of safety ratio= 0.2571
Finally, the desired profit is $110,000:
Break-even point in units= (fixed costs + desired profit) / contribution margin per unit
Break-even point in units= (187,200 + 110,000) / 360
Break-even point in units= 826
A Korean steel company produces steel in the United States, with some of its steel being exported to other nations and some of it being sold within the United States. If the prices of this steel increase, then a. the GDP deflator and the CPI will both increase. b. the GDP deflator will increase and the CPI will be unchanged. c. the GDP deflator will be unchanged and the CPI will increase. d. the GDP deflator and the CPI will both be unchanged.
Answer:
a
Explanation:
Who is more likely to object to a proposed 1 percentage point increase in the city sales tax—the owner of a local liquor store or the owner of a local video rental store? Why?
Answer:
The owner of a local liquor store.
Explanation:
Rentals are not taxed in some places.
Leslie's Unique Clothing Stores offers a common stock that pays an annual dividend of $3.00 a share. The company has promised to maintain a constant dividend. How much are you willing to pay for one share of this stock if you want to earn a return of 15.80 percent on your equity investments
Answer:
You are willing to pay $18.99 for one share of this stock.
Explanation:
This can be calculated using the following formula:
P = d / r .............................. (1)
Where;
P = price per share = ?
d = annual dividend per share = $3.00
r = equity investments return = 15.80%, or 0.1580
Substituting the values into equation (1), we have:
P = $3.00 / 0.1580
P = $18.99
Therefore, you willing to pay $18.99 for one share of this stock.
A company produces a product with variable costs of $2.50 per unit. The product sells for $5.00 per unit. The company has fixed costs of $3,000 and desires a target income of $10,000. The sales level in dollars to achieve the desired target income is $ .
Answer:Break-even point (dollars)= $26,000
Explanation:
Answer:
3000 esta es la respuesta