Answer:
$1,125.98
Explanation:
market price of the bonds = present value of face value + present value of coupons
PV of face value = $1,000 / (1 + 0.0599)⁴ = $792.39
PV of coupons = coupon x {1 - [1/(1 + r)ⁿ]} / r = 96.25 x {1 - [1/(1 + 0.0599)⁴]} / 0.0599 = 96.25 x 3.34659 = $333.59
market value = $792.39 + $333.59 = $1,125.98
company is considering the purchase of a new piece of equipment for $90,000. Predicted annual net cash inflows from the investment are $36,000 (Year 1), $30,000 (Year 2), $18,000 (Year 3), $12,000 (Year 4), and $6,000 (Year 5). The average operating income generated from the investment over its 5-year life is $20,400. The cash payback period is 3.5 years true false
Answer:
The cash payback period is 3.5 years. The answer is True.
Explanation:
According to the given data we have the following:
Year Cash flows Cumulative Cash flows
0 (90,000) (90,000)
1 36,000 (54,000)
2 30,000 (24,000)
3 18,000 (6000)
4 12000 6000
5 6000 12,000
To calculate the cash payback period we use the following formula:
Payback period=Last period with a negative cumulative cash flow+(Absolute value of cumulative cash flows at that period/Cash flow after that period).
Payback period=3+($6,000/$12,000)
Payback period=3.5 years
The cash payback period is 3.5 years. True
The following selected transactions were completed by Fasteners Inc. Co., a supplier of buttons and zippers for clothing:
20Y3
Nov.
21 Received from McKenna Outer Wear Co., on account, a $66,000, 60-day, 8% note dated November 21 in settlement of a past due account.
Dec.
31 Recorded an adjusting entry for accrued interest on the note of November 21. 20Y4
Jan.
20 Received payment of note and interest from McKenna Outer Wear Co.
Required:
Journalize the entries to record the transactions.
Answer:
20Y3
Nov. 21 :
Debit Notes receivable $66,000
Credit Accounts receivable $66,000
(To recognize notes receivable iro past due account)
Dec. 31:
Debit Interest revenue $161.33
Credit Interest receivable $161.33
(To record accrued interest on notes receivable)
Jan. 20:
Debit Cash $66,880
Credit Notes receivable $66,000
Credit Interest receivable $880
(To record payment of note and interest on Nov. 21 notes)
Explanation:
Note receivable is a promissory note with a written promise made by the borrower to the lender (payee) to pay a certain, definite sum at a specified date.
Interest revenue on the notes is calculated as: Principal x Interest Rate x Time
In this case, the total interest expense is $66,000 x 8%/12 x 2 months = $880.
Total interest expense to the Company as at December 31 is therefore $880 / 60 days x 11 days = $161.33.
A $20,000 loan is to be amortized for 10 years with quarterly payments of $699.44. If the interest rate is 7%, compounded quarterly, what is the unpaid balance immediately after the sixth payment
Answer:
The answer is "17809.46"
Explanation:
Given:
P= $20,000
quarterly payment k= $699.44
interest rate quarterly r= 7%
[tex]r=\frac{7}{400}\\\\r= 0.0175[/tex]
n=6
Formula:
[tex]\ unpaid \ balance = P(1+r)^n-K\times \frac{(1+r)^n-1}{r}[/tex]
[tex]=20,000(1+0.0175)^6-699.44\times \frac{(1+0.0175)^6-1}{0.0175}\\\\=20,000(1.0175)^6-699.44\times \frac{(1.0175)^6-1}{0.0175}\\\\=20,000\times 1.10970235-699.44\times \frac{1.10970235-1}{0.0175}\\\\=22,194.047-699.44 \times \frac{0.10970235}{0.0175}\\\\=22,194.047-699.44 \times 6.26870571\\\\=22,194.047-4384.58352\\\\=17809.4635\\\\[/tex]
The final answer is "[tex]\bold{= 17809.46}\\[/tex]".
The following monthly data are available for Sheridan Company which produces only one product: Selling price per unit, $38; Unit variable expenses, $14; Total fixed expenses, $42000; Actual sales for the month of June, 7000 units. How much is the margin of safety for the company for June
Answer:
$199,500
Explanation:
The computation of the margin of safety is shown below:
As we know that
margin of safety = Actual sales - break even sales
where,
Actual sales is
= Actual sales units × Selling price per unit
= 7,000 units × $38
= $266,000
And, the break even sales is
= Fixed cost ÷ contribution margin per unit
= $42,000 ÷ ($38 - $14)
= $42,000 ÷ $24
= 1,750 units
Now the break even sales is
= Break even units × selling price per unit
= 1,750 units × $38
= $66,500
So, the margin of safety is
= $266,000 - $66,500
= $199,500
At the beginning of the period, the Grinding Department budgeted direct labor of $19,800 and property tax of $51,000 for 1,100 hours of production. The department actually completed 1,500 hours of production.
Required:
Determine the budget for the department, assuming that it uses flexible budgeting.
Answer:
Budget for the Grinding department is $78,000, assuming that it uses flexible budgeting.
Explanation:
Note: Fixed cost remain constant at any level of production
Budgeted Direct labor at 1,100 hours of production is
= Budgeted direct labor / hours
= 19,800 / 1,100
=$18 per hour
Direct labor cost at 1,500 hours of production is:
=1,500 * $18
=$27,000
Budget for the Grinding department at 1,500 hour of production is:
=Direct labor cost + Property tax
=$27,000 + $51,000
=$78,000
A book which cost $300.00 was sold
For $240.00. What was the loss
percentage
Answer:
20%
Explanation:
300-240= 60
60÷300×100%= 20%.
Testbank Multiple Choice Question 96 On June 30, 2021, when Bonita Industries's stock was selling at $66 per share, its capital accounts were as follows: Capital stock (par value $50; 58000 shares issued) $2900000 Premium on capital stock 580000 Retained earnings 4150000 If a 100% stock dividend were declared and distributed, capital stock would be $3480000. $5800000. $7656000. $2900000.
Answer:
$5800000
Explanation:
Stock dividend refers to a form of dividend payment whereby additional stock shares of the company are distributed to shareholders instead of paying the shareholders in cash.
Stock dividends are also known as stock spills and it increases the common stock par value by its declared percentage.
Since the a 100% stock dividend were declared and distributed, this would increase the common stock as follows:
Increase in common stock = $2,900,000 * 100% = $2,900,000.
Therefore, the new common stock would be:
New common stock = Existing common stock + Increase in common stock = $2,900,000 + $2,900,000 = $5,800,000.
Therefore, If a 100% stock dividend were declared and distributed, capital stock would be $5,800,000.
Accounting practice in the United States follows the generally accepted accounting principles (GAAP) developed by the Financial Accounting Standards Board (FASB), which is a nongovernmental, professional standards body that monitors accounting practices and evaluates controversial issues. The Securities and Exchange Commission (SEC) requires all publicly traded companies to periodically report their financial information.
A publicly held corporation must publish an annual report that contains the balance sheet, income statement, statement of cash flows, statement of retained earnings, and other financial information for analysis.
The following descriptions of the major financial statements and reports that a firm publishes. Identify the correct statement or report for each description.
Description :
a. Is required by the SEC and includes the audited document that shows the company's financial results for the past year and management's discussion about the future outlook and plans
b. Gives details about the firm's sales, costs, and profits for the past accounting period
c. Details changes in the capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earings.
d. Provides details about the flow of funds from operating, investing, and financing activities.
e. Summarizes a company's assets, liabilities, and stockholders' equity at a specific point in time.
Answer: a. Annual Report
b. Income statement
c. Statement of Shareholder Equity.
d. Cashflow Statement
e. Balance Sheet.
Explanation:
The Annual Report is a comprehensive report that aims to show stakeholders including the SEC what the company has been up to in the previous year. It analyzes the business's financial report and also the strategic goals of the business as well.
The Income Statement lets stakeholders know how the company's business transactions went for the previous period. It shows how much goods and services were sold as well as the expenses involved.
The Statement of Shareholder Equity aims to show how the business's dealings during the year have impacted the ownership of the company. It shows the Capital and the Retained Earnings.
The Cashflow Statement aims to show just how much actual cash that the business has. To do so it usually divides the cash transactions into Operating, Investing, and Financing activities.
The Balance Sheet summarizes the components of the Accounting Equation which includes Assets, Liabilities and Equity. This way a person can see at a glance how the business operates.
Crane Company incurs these expenditures in purchasing a truck: cash price $23,030, accident insurance (during use) $1,690, sales taxes $1,380, motor vehicle license $670, and painting and lettering $2,140. What is the cost of the truck
Answer:
$27,220
Explanation:
Cost of the truck includes : Cash price + sales tax + motor vehicle license + painting and lettering
accident insurance would not be added because its a revenue expenditure as it will reoccur after a year.
$23,030 + $670 + $2,140 + $1,380 = $27,220
I hope my answer helps you
Answer:
$27,220
Explanation:
From the question above Crane company incurs the following expenditures in purchasing a truck
Cash price = $23,030
Accident insurance during use= $1,690
Sales tax= $1,380
Motor vehicle license= $670
Painting and lettering= $2,140
Therefore, the cost of the truck can be calculated as follows
= $23,030+$1,380+$670+$2,140
= $27,220
The accident insurance is not added to find the cost of the truck because it doesn't add any value and can happen again the following year.
Hence the cost of the truck is $27,220
Suppose that Tommy takes a workplace personality quiz that shows that he is highly creative. Store managers decide to transfer him to the produce department, where he is trained in cutting produce and displaying it on the shelves. Which approach to job design best characterizes this scenario?
Answer:
The Motivational approach
Note: Find an attached image of the complete question to this solution below.
Explanation:
Solution
In this scenario Tommy is one of the person in meat department that has specialized skill in cutting process that even neglect his pain making the cutting process.
The transferring to producing department make him to show the produced cutting meat to attract customers to the store.
That step taken in regards to Tommy by the store managers is a motivational approach.
Source: The research for the complete question was taken from quiz-let platform
To create a bulleted list, Nathan should select the list first. Next, he should navigate to the of the Word window. After that, he should go to the command group. Then, he should click the picture that shows .
Answer: 3 tiny dots with tiny lines next to them.
Explanation: Because that is the icon you select to insert bullet points or a number system.
If a business using the specific identification method of inventory has two items on hand at $300 each and purchases four items at $400 each, what is the value of inventory if two of the $300 items are sold
Answer:
The value of inventory is $1600.
Explanation:
The business has two inventory on hand that cost $300 each so total value of inventory = 2 × 300 = $600
The value of four items at $400 each = 4 × 400 = $1600
Total number of items = 2 + 4 = 6
Total value of 6 items = 600 + 1600 = $2200
The value of sold inventory = 2 × 300 = $600
The value of inventory = total value of inventory - The value of sold inventory
The value of inventory = $2200 - $600
The value of inventory = $1600
If all you knew about a production system was that total daily output was 400 units and the total labor necessary to produce the 400 units was 350 hours, and the total materials used were 425 units, what kind of productivity measure could you use to compute productivity?
Answer:
partial measure
Explanation:
Based on the information provided it can be said that the kind of productivity measure that can be used would be a partial measure. Partial Productivity measure relates output to a single input unit. For example, capital productivity deals with output per unit of capital while energy productivity relates output per joule of energy used. In this scenario, we would need labor productivity which is output per hour worked.
For a business credit card, most companies that issue credit, including Visa and Mastercard, specifically state their liability policies:
Only cover the first $50.00 of liability
Cover up to $500 of liability
Are the same as their business card accounts
Do not apply to business card accounts
Answer: Cover up to $500 of liability
Explanation:
When one suspect that there has been unauthorized transactions in ones accounts which could be due to fraud, such business or person can make a complaint as soon as possible.
As soon as the report is made, the person is no longer in charge of the unauthorized use of such card. In a case whereby the loss is reported within two days, the liability is limited to $50 but when the report is made within 60 days after ones statement has been sent to the person or business, this may lead to a liability of $500.
Cover upto liability of $500. If the report is made within 60 days of receiving statement that shows fradulent transactions. If it is not reported within 60 days then the liability is unlimited.
The balance in Ashwood Company's Accounts Payable account at December 31, 2016, was $1,200,000 before any necessary year-end adjustment relating to the following: Goods were in transit from a vendor to Ashwood on December 31, 2016. The invoice cost was $85,000, and the goods were shipped FOB shipping point on December 29, 2016. The goods were received on January 2, 2017. Goods shipped FOB shipping point on December 20, 2016, from a vendor to Ashwood were lost in transit. The invoice cost was $40,000. On January 5, 2017, Ashwood filed a $40,000 claim against the common carrier. Goods shipped FOB destination on December 22, 2016, from a vendor to Ashwood were received on January 6, 2017. The invoice cost was $20,000. What amount should Ashwood report as accounts payable on its December 31, 2016, balance sheet? a. $1,345,000 b. $1,325,000 c. $1,260,000 d. $1,285,000
Answer:
$1,325,000 is the amount to be recorded as accounts payable on Ashwood's report of 31 December, 2016 balance sheet
Explanation:
Here, we want to calculate the amount that Ashwood should report as accounts payable on its December 31, 2016 balance sheet.
The correct answer to this is adding together : The balance in Ashwood Company's Accounts Payable account at December 31, 2016 + Invoice cost of goods in transit from vendor on December 31, 2016 + invoice cost of goods lost in transit
From the question, we can identify the following;
Balance in Ashwood Company's Accounts Payable account at December 31, 2016 = $1,200,000
invoice cost of goods in transit from vendor on December 31, 2016 = $85,000
invoice cost of goods lost in transit = $40,000
Plugging these values into the equation, we have;
1,200,000 + 85,000 + 40,000 = $1,325,000
After examining a planning gap, firms typically attempt to decide if the time horizon should be increased or decreased. perform a SWOT analysis with their major competitor as the focus. use statistical trend analysis to interpret the results. exploit a positive deviation and correct a negative deviation. adopt a product-market focus.
Answer: exploit a positive deviation and correct a negative deviation
Explanation:
A planning gap is the difference that occurs in revenue or profits gap when current strategies are not changed. The gap analysis can help in the identification of gaps in the market. Therefore, when an organization compares its forecast profits to the company's desired profits, the planning gap will be shown.
When the actual results are lesser than the planned result, the organization would have to fill the gap with a marketing program which has been revised and sometime with new goals. Therefore, the firm can then decide whether to exploit wither a positive deviation and correct a negative deviation.
. Nestle Co. paid $130,000 for a machine used to mill oats. The annual contribution margin from oat sales is $60,000. The machine could be sold for $80,000. The opportunity cost of producing the oats is ________. Question 20 options: $130,000 $0 $80,000 $20,000 $60,000
Answer:$80,000
Explanation:
Opportunity cost refers to an alternative forgone that is the value one could have received but declined to take the next best alternative according to his or her preference.
Here , Nestle has two choices to make, it can decide to produce oats or sell the machine, but taking the option of producing oats leaves the option of selling the machine at $80,000 as the Opportunity cost.
The next dividend payment by Savitz, Inc., will be $1.68 per share. The dividends are anticipated to maintain a growth rate of 6 percent forever. If the stock currently sells for $32 per share, what is the required return
Answer:
The answer is 11.25%
Explanation:
Solution
Given that:
The next step to take is to calculate the required rate of return which is shown below:
The required rate = D₁/P₀₀ + g
Thus,
$1.68/$32 + 0.06%
=0.0525 + 0.06
=0.1125 or 11.25%
Therefore, the required rate of return is 11.25%
Green Company is planning to introduce a new product with a 75 percent incremental unit-time learning curve for production in batches of 1,500 units. The variable labor costs are $55 per unit for the first 1,500-unit batch. Each batch requires 200 hours. There are $15,000 in fixed costs not subject to learning. What is the cumulative total time (labor hours) to produce 3,000 units
Answer:
210 hours
Explanation:
The learning curve rate can be found by log75%
Ln0.75 = 0.12249
1 batch requires 200 hours
The 1500 units batch will require 200 hours
For 3000 units there will be two batches of 1500 units each
200 hours * 2 batches * 0.12249 * 4.5 = 210 hours
ete is a California resident who is serving in California when he is transferred to Virginia under Temporary Duty (TDY) assignment. His salary is $3,000 per month. Pete is transferred on April 1 of the current year. How much of his income is taxable in California
Answer:
$36,000
Explanation:
Temporary duty can't change anything when someone is domiciled in the state and a responsible resident of the state, therefore his whole income would be taxable as usual whether he is in the state or out of state.
Workings:
Financial year= 12 months
Monthly salary = $3,000
Taxable income= $3,000 x 12 months
Taxable income = $36,000
Revenue and expense data for the current calendar year for Tannenhill Company and for the electronics industry are as follows. The Tannenhill Company data are expressed in dollars. The electronics industry averages are expressed in percentages.
1 Tannenhill Company Electronics Industry Average
2 Sales $4,000,000 100%
3 Cost of goods sold $2,120,000 60%
4 Gross profit $1,888,000 40%
5 Selling expenses $1,080,000 24%
6 Administrative expenses $640,000 14%
7 Total operating expenses $1,720,000 38%
8 Income from operations $160,000 2%
9 Other income $120,000 3%
10 $280,000 5%
11 Other expense $80,000 2%
12 Income before income tax $200,000 3%
13 Income tax expense $80,000 2%
14 Net income $120,000 1%
A. Prepare a common-size income statement comparing the results of operations for Tannenhill Company with the industry average. Enter all amounts as positive numbers.
B. As far as the data permit, comment on significant relationships revealed by the comparisons. As far as the data permit, comment on significant relationships revealed by the comparisons.
Answer:
Explanation:
Tannenhill % Industry
Sales 4,000,000 100 100
Cost of goods 2,120,000 53 60
Gross profit 1,880,000 47 40
Selling Expenses 1,080,000 27 24
Admin Expenses 640,000 16 14
Operating Expenses 1,720,000 43 38
Operating profit 160,000 4 2
Other income 120,000 3 3
Total income 280,000 7 5
Other Expenses 80,000 2 2
Income before tax 200,000 5 3
Income tax 80,000 2 2
Net Income 120,000 3 1
B)
Despite the fact that the selling and admin expenses pf Tannenhill was higher than the industry average , it had a better performance in the cost of goods management which in effect caused Tannenhill to record a greater net income percentage compared to the industry performance.
The other income and expenses was the same with the industry average , hence no impact on the overall performance.
Bob wants to help his daughter, Violet, upgrade her home. Bob buys a new refrigerator and oven for Violet on credit from a home supply store. He instructs the home supply store to deliver the new appliances to Violet's home for installation. Which of the following is true with regard to this scenario?
a. Bob's promise to pay the home supply store must be in writing.
b. Bob's promise to pay the home supply store can be oral.
c. Bob's liability to the home supply store is quasi-contractual in nature.
d. Bob's promise to pay the home supply store is void.
Answer:
A
Explanation:
must be in writing
hope it helps
Blythe and Cali do business as Diamond Investments. In acting on the firm's behalf,Blythe makes an honest error in overestimating the value of a particular stock purchase. To her firm,Blythe is:__________.
A) liable for breach of the duty of care.
B) liable for breach of the duty of accounting.
C) liable for breach of the duty of accounting.
D) not liable.
Answer:
D) not liable.
Explanation:
Duty of Care is the legal expectation from individuals and businesses in the course of discharging their duties, not to engage in conduct that could be foreseen to predispose others to danger or harm. The Duty of Accounting or accounting responsibility requires an accurate record of transactions. Liability implies being legally answerable. In business transactions, businessmen owe it to their customers to provide their services and products in the best possible way so as to prevent causing harm to them. Employees also owe it to the organization they work for to discharge their duties carefully to avoid causing them loss.
Blythe's honest error in overestimating the value of a particular stock purchase is a mistake that anyone can make and can be easily corrected. Her company would not go the long route of taking her to court over such a mistake. Therefore, Blythe is not liable to her company.
Jack's Construction Co. has 80,000 bonds outstanding that are selling at par value. Bonds with similar characteristics are yielding 8.5%. The company also has 4 million shares of common stock outstanding. The stock has a beta of 1.1 and sells for $40 a share. The U.S. Treasury bill is yielding 4% and the market risk premium is 8%. Jack's tax rate is 35%. What is Jack's weighted average cost of capital
Answer:
The answer is =10.36%
Explanation:
The weighted average cost of capital (WACC) is a way that a company calculates its cost of financing and acquiring assets by comparing the debt and equity structure of the business.
WACC = WeRe + WdRd
We is weight of equity
Re is cost of equity
Wd is weight of debt
Rd is cost of debt
For its cost of equity:
Ke = Rf + beta(market risk premium)
Where Ke is cost of equity
Rf is risk free rate of return( treasury bill return)
4% + 1.1 x 8%
= 12.8%
Total debt 80,000 x $1,000 = $80million
Common: 4million x $40 = $160million
Total = $80milllion + $160million
=$240million.
Therefore, WACC is
WdRd= 80/240 x [8.5% x(1-35%)]
80/240 x 5.5%
=1.83%
WeRe = 160/240 x 12.8%
= 8.53%
=1.83% + 8.53%
=10.36%
Five years ago you took out a 30-year mortgage with an APR of 6.5% for $200,000. If you were to refinance the mortgage today for 20 years at an APR of 4.25%, how much would your monthly payment change by?
Answer:
-$104.79
Explanation:
Current Mortgage Payment:
P/Y = 12,
N = 360,
I/Y = 6.5,
PV = $200,000,
Solve
for PMT = $1,264.14
Current Mortgage Balance:
P/Y = 12,
N = 300,
I/Y = 6.5,
PMT = $1,264.14,
Solve
for PV = $187,221.9
New Mortgage Payment:
P/Y = 12,
N = 240,
I/Y = 4.25,
PV = $187,222.54,
Solve
for PMT = $1,159.35
Current Payment - New Payment
= $1,159.35- $1,264.14
= -$104.79
Balt Company maintains a standard cost system. Last period, Balt spent $25,000 during the period to purchase 3,000 pounds of material H. The company used 5,000 pounds of Material H to produce 800 units of Product C8. The company has established a standard of 7 pounds of Material H per unit of C8, at a price of $7.50 per pound of material. The debit to direct materials control account isa. 25,000b. 22,500c. 41,667d. 37,500
Answer:
Balt CompanyDirect Materials Control Account:
Debit to the direct materials control account is
d. 37,500
Explanation:
a) Calculation:
Since 5,000 pounds were used at a standard price of $7.50, a debit to the direct materials control account would be $37,500 (5,000 x$7.50).
b) The direct materials control account is a memorandum account where the costs of direct materials are recorded to serve as a check and point of reconciliation with the subsidiary ledger of direct materials account. This debit shows the standard costs at actual production that is expensed for the period or during the process.
Evans Inc. had current liabilities at April 30 of $69,400. The firm's current ratio at that date was 1.7. Required: Calculate the firm's current assets and working capital at April 30. Assume that management paid $14,300 of accounts payable on April 29. Calculate the current ratio and working capital at April 30 as if the April 29 payment had not been made. (Round "Current ratio" answer to 2 decimal places.) Identify the changes, if any, to working capital and the current ratio that would be caused by the April 29 paym
Answer:
See explanation below
Explanation:
Given:
Current liabilities at April 30 of $69,400
Current ratio = 1.7
a) Calculate the firm's current assets and working capital at April 30:
Use the formula below to find the firm's current assets:
current ratio= current asset/current liability
current asset = current ratio × current liability
current asset = 1.7 × $69,400
Current asset = $117,980
For working capital:
Working capital= current assets-current liability
= $117,980 - $69,400
= $48,580
Working capital = $48,580
b) Calculate the current ratio and working capital at April 30 as if the April 29 payment had not been made:
New current assets = $117,980 + $14,300 = $132,280
New current liability = $69,400 + $14,300 = $83,700
Working capital = $132,280 - $83,700 = $48,580
Current ratio = 132,280/83700 = 1.58
c) There is no change in the working capital.
The current ratio will decrease by 0.12 (1.7 - 1.58) due to payment on 29th April
Revise your worksheet to reflect the following transactions and updated values at the end of the accounting period, then answer the questions that follow. 7,200 1,400 9,900 1,100
1. Cash on hand at the company and not yet deposited at the bank.
2. EFT for monthly utility bill not yet recorded by the company.
3. Note collected by the bank and not yet recorded by the company.
4. Interest collected by the bank from note in #3 not yet recorded by the company.
5. A check witten for insurance expense for $110 was cashed. The check was recorded on the books for $190.
6. Checks written by the company but not yet processed by the bank.
7. Service fee charged by bank but not yet recorded by the company.
8. Customer checks determined by the bank to have nonsufficient funds. 3,100 100 2,700
Bank balance at the end of the period.
Company balance at the end of the period. 19,610 16,830 Required:
1-a. What is the revised
Cash balance at the end of the period?
Cash $ 23,710 1-b. Is the bank reconciliation in balance?
Yes
Nο
2-a. What is the balance in Cash if the entry to correct the insurance payment hasn't been made?
Cash 2-b. Would the bank reconciliation still be in balance?
Yes
No
3. Which statement below is true regarding the effect of the company incorrectly recording a customer deposit at $190,000 rather than $19,000?
No effect on the bank reconciliation.
The difference of $171,000 will be subtracted from the book balance.
The difference of $171,000 will be added to the book balance.
The bank balance will be increased by $190,000.
Answer:
1a. Revised Cash balance $23,710
1b. No. the Bank reconciliation is NOT in balance
2a.$23,630
2b.No. The bank reconciliation will still NOT be in balance
3.The difference of $171,000 will be subtracted from the book balance
Explanation:
1a.Preparation of the Revised Cash Book
Particular Debit Particular Credit
Unadjusted $16,830; EFT of Utility $1,400
Balance $9,900 ; Bil $100
Note Collected 1,100; Service Fee Charged $2,700
Interest on Note Collected 90 ; NSF Checks Dishonored $23,710
Excess of Insurance Expense 27,910; Revised Balance $27,910
Therefore the Revised Cash balance at the end of the period will be $23,710
1b.NO. The Bank reconciliation is NOT in balance because the revised balance is still not matched with the bank balance reason been that the amount of $23,710 is not equal to $19,610
2-a) In a situation where the entry to correct the insurance payment hasn’t been made, the balance of cash book will be :
$23,710 – $80 = $23,630
2-b) No. The bank reconciliation will still NOT be in balance because $23,630 is not equal to $19,610
3. If company incorrectly recording a customer deposit at $190,000 rather than $19,000, this increases the balance of cash book by $171,000. Therefore, the company subtracted the difference of $171,000 from the book balance
1a.Rectified Cash balance $23,710
1b.No. the Bank reconciliation is NOT in balance
2a.$23,630
2b.No.The bank reconciliation will always NOT be in balance
Prepare Bank reconciliation
1a. Now we Preparation of the Revised Cash Book is:
Particular Debit and Credit
Unadjusted $16,830; and EFT of Utility $1,400The Balance is $9,900; Bill is $100Then Note Collected 1,100; Service Fee Charged $2,700Now the Interest on Note Collected 90; NSF Checks Dishonored $23,710Then Excess of Insurance Expense 27,910; Revised Balance $27,910Hence the Revised Cash balance at the end of the period will be $23,7101b.NO. When The Bank reconciliation is NOT in balance because the adjusted balance is still not matched with the bank balance reasoning is that the amount of $23,710 is not equal to $19,610
2-a) In circumstances where the entry to rectify the insurance payment hasn’t been made, the balance of the cash book will be :
$23,710 – $80 = $23,630
2-b) No. When The bank reconciliation will still NOT be in balance because $23,630 is not equal to $19,610
3. If the company mistakenly registers a consumer deposit at $190,000 rather than $19,000, this increases the balance of the cash book by $171,000. Thus, the company subtracted the distinction of $171,000 from the book balance The distinction of $171,000 will be subtracted from the book balance
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Congratulations! You just finished up your MHA. You are now making the big bucks!! You are pulling down $75,000 a year. Your estimated payroll taxes are 20%. You also have a small healthcare consultancy and you make $100 a month for your wonderful advice. You have a lot of expenses: You bought a new car - the car note is $350 a month. Gas for your car is $50 a month You have a mortgage of $850. Health insurance is $400 You love to eat out and you spent $300 a month in food. You have a student loan payment of $300 You have a credit card monthly statement of $1,100 How much do you have left at the end of this month?
Answer:
Balance available on hand at month-end is $1,750
Explanation:
Monthly gross salary= $6,250 ($75,000 / 12 month)
Less: Payroll Taxes $1,250 ($6,250 * 20%)
Net Monthly salary $5,000
Add: Monthly Consultancy Income $100
Monthly income available on hand $5,150 $5,150
Less: Monthly Car note $350
Monthly Car gas $50
Monthly mortgage $850
Monthly Health insurance $400
Monthly food spending $300
Monthly student loan payment $300
Monthly credit card payable $1,100
Total deductions $3,350 $3,350
Balance available on hand at month-end $1,750
Suppose that a young couple has just had their first baby and they wish to ensure that enough money will be available to pay for their child's college education. Currently, college tuition, books, fees, and other costs average $20,000 per year. On average, tuition and other costs have historically increased at a rate of 6% per year. Assuming that college costs continue to increase an average of 6% per year and that all her college savings are invested in an account paying 8% interest, then the amount of money she will need to have available at age 20 to pay for all four years of her undergraduate education is closest to ________.
Answer:
$256,571
Explanation:
College Graduation fee for four years in the present value
PV = $20,000 x 4 = $80,000
As historically the fee has risen by 6% we need to find future value when the baby will be 20 years old by using future value formula
Let's say
FV = Future value
PV = Present value
n = number of years
i = Interest
Workings
FV = PV x ((1+growth rate)^n)
FV = $80,000 x ( (1+0.06)^20)
FV = $256,571
As the bank interest rate is 8% the saving need to be deposited annualy can be calculated as
Savings = (FV x i) / ((1+i)^n)-1)
Savings = ($256,571 x 0.08) / ((1+0.08)^20)-1)
Savings = 20,525.68 / 3.66
Savings = $5,608