Answer:
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The following transactions for the month of March have been journalized and posted to the proper accounts. Mar. 1 The business received a $9,000 cash contribution from the owner. Mar. 2 Paid the first month's rent of $600. Mar. 3 Purchased equipment by paying $4,000 cash and executing a note payable for $5,000. Mar. 4 Purchased office supplies for $600 cash. Mar. 5 Billed a client for $10,000 of design services completed. Mar. 6 Received $8,000 on account for the services previously recorded. What is the balance in Accounts Receivable
Answer:
$2,000
Explanation:
Calculation for What is the balance in Accounts Receivable
Credit sales $10,000
Less : Collection ($8,000)
Account receivable $2,000
Therefore the balance in Accounts Receivable will be $2,000
Direct Materials Used in Production
Slapshot Company makes ice hockey sticks. On June 1, Slapshot had $48,000 of materials in inventory. During the month of June, the company purchased $132,000 of materials. On June 30, materials inventory equaled $45,000.
Required:
Calculate the direct materials used in production for the month of June.
Answer:
$135,000
Explanation:
The direct materials used in production for the month of June is computed as;
= Materials inventory at June 1 + Materials purchased during the month of June - Materials inventory at June 30
= $48,000 + $132,000 - $45,000
= $135,000
Therefore, the direct materials used in production for the month of June is $135,000
Based on this model, households earn income when _______purchase______ in factors markets.
Suppose Eileen earns $600 per week working as a corporate attorney for Rowan and Martin Associates. She uses $8 to buy a box of aspirin at Pillmart Pharmacy. Pillmart Pharmacy pays Clancy $350 per week to work the cash register. Clancy uses $175 to purchase legal service from Rowan and Martin Associates Identify whether each of the following events in this scenario occurs in factor market or the product market.
Event Factor Market Product Market
Clancy earns $350 per week working for Pillmart Pharmacy.
Eileen earns $600 per week working for Rowan and Martin Associates
Clancy spends $175 to purchase legal service from Rowan and Martin Associates.
Which of the elements of this scenario represent a flow from a household to a firm? This could be a flow of dollars, inputs, or outputs.
a. The $350 per week Clancy earns working for Pillmart Pharmacy
b. The $175 Clancy spends to purchase legal service from Rowan and Martin Associates
c. The aspirin Eileen receives
d. Eileen's labor
Answer:
Based on this model, households earn income when FIRMS purchase SERVICES in factors markets.
Identify whether each of the following events in this scenario occurs in factor market or the product market.
Event Factor Market Product Market
Clancy earns $350 per week working for Pillmart Pharmacy. FACTOR MARKET
Eileen earns $600 per week working for Rowan and Martin Associates FACTOR MARKET
Clancy spends $175 to purchase legal service from Rowan and Martin Associates. PRODUCT MARKET
Which of the elements of this scenario represent a flow from a household to a firm? This could be a flow of dollars, inputs, or outputs.
b. The $175 Clancy spends to purchase legal service from Rowan and Martin Associates PRODUCT MARKET, HOUSEHOLD PURCHASES PRODCUTS
d. Eileen's labor FACTOR MARKET, HOUSEHOLDS SELL SERVICES TO FIRMS
Carla Vista Co. reports operating expenses in two categories: (1) selling and (2) general and administrative. The adjusted trial balance at December 31, 2020, included the following expense accounts: Accounting and legal fees $421000 Advertising 364000 Freight-out 225500 Interest 174100 Loss on sale of long-term investments 89600 Officers' salaries 541000 Rent for office space 540000 Sales salaries and commissions 404000 One-half of the rented premises is occupied by the sales department. How much of the expenses listed above should be included in Carla Vista's selling expenses for 2020
Answer:
$1.263,000
Explanation:
The amount of expenses to be included in P's selling expenses is calculated as follows:
Particulars Amount
Advertising $364,000
Freight out $225,500
Rent for office space $270,000 (540,000*1/2)
Sales salaries & commissions $404,000
Total $1.263,000
So, the total amount to be included in selling expenses is $1.263,000.
Ben wants to do business in the Middle East where it is an accepted practice to give gifts to government officials. However, Ben may not be able to carry out his plans because he doesn't want to violate The Foreign Corrupt Practices Act (FCPA), which was enacted because Congress was concerned about _______.
Answer:
U.S. corporations' use of illegal payments and bribes in international business dealings
Explanation:
From the question, we are informed about Ben who wants to do business in the Middle East where it is an accepted practice to give gifts to government officials. However, In this case, Ben may not be able to carry out his plans because he doesn't want to violate The Foreign Corrupt Practices Act (FCPA), which was enacted because Congress was concerned about U.S. corporations' use of illegal payments and bribes in international business dealings.
The Foreign Corrupt Practices can be regarded as one the U.S law of 1977 act. This law is about prohibition of citizens of U.S as well as entities from giving bribes to officials of government of foreign countries in order to be a beneficiary of their business interests
Someone offers to buy your old Ford F-150 truck for 4 equal annual payments, beginning 2 years from today. If you think that the present value of your Ford Truck is only $9,000 and you assume the interest rate is 10%, which one of the below would be the minimum annual payment that youâ d be willing to accept? $2,839.24 $3,435.48 $3,123.16 $2,250
Answer:
$3,123.16
Explanation:
The computation of the minimum annual payment is as follows:
Given that
RATE = 10%
NPER = 10%
PV = $9,000 × (1 + 0.1) = $9,900
FV = $0
The formula is shown below:
= PMT(RATE,NPER,-PV,FV,TYPE)
After applying the above formula, the monthly payment is $3,123.16
Beta Alpha Psi, the accounting honorary fraternity, held a homecoming party. The fraternity expected attendance of 80 persons and prepared the following budget: Room rental .. $ 170 Food ....... 660 Entertainment .. 570 Decorations ... 210 Total ...... $1,610 After Beta Alpha Psi paid all the bills for the party, the total cost came to $1,885 or $275 over budget. Details are $170 for room rental; $875 for food; $570 for entertainment; and $270 for decorations. Ninety-six persons attended the party. 1. Prepare a performance report for the party that shows how actual costs differed from the budget. That is, include in your report the budgeted amounts, actual amounts, and variances. 2. Suppose the fraternity uses a management-by-exception rule. Which costs deserve further examination
Answer:
Beta Alpha Psi
1. Performance Report for the party:
Budget Actual Variance
Expected attendance (persons) 80 96 16
Room rental .. $ 170 $170 $0
Food ....... 660 875 $215 U
Entertainment .. 570 570 $0
Decorations ... 210 270 $60 U
Total ...... $1,610 $1,885 $275 U
2. The costs that deserve further examination are Food and Decorations. The party overspent on these items.
Explanation:
Since 96 persons attended the party, the food cost should have been = $792 ($660/80 * 96), which is the flexible budget cost. The cost of decorations should have remained $210 unless there were improper estimates of the items required for the decorations and the size of the party venue.
The Package Store hires workers to wrap packages. The store sells this service for $5. The marginal revenue product of this store's fifth worker is $50. The marginal product of the fifth worker is A) 0.01 package. B) 1 package. C) 10 packages. D) indeterminate from this information
Answer: 10 packages
Explanation:
Marginal revenue (MR) is defined as an increase in the revenue that a company makes which is gotten from an additional sale that is made from a unit of output.
The marginal product of the fifth worker will be calculated as:
= Marginal Revenue Product / Price
= 50/5
= 10
Brief Exercise 1-1 (Algo) Accrual accounting [LO1-2] Cash flows during the first year of operations for the Harman-Kardon Consulting Company were as follows: Cash collected from customers, $290,000; Cash paid for rent, $30,000; Cash paid to employees for services rendered during the year, $110,000; Cash paid for utilities, $40,000. In addition, you determine that customers owed the company $50,000 at the end of the year and no bad debts were anticipated. Also, the company owed the gas and electric company $1,000 at year-end, and the rent payment was for a two-year period. Calculate accrual net income for the year.
Answer:
Net Income for the year is $174,000
Explanation:
Net Income Calculation for the year is done below:
Particulars $
Revenues (290,000 + 50,000) 340,000
Less: Rent (30,000 / 2) (15,000)
Less: Salaries (110,000)
Less: Utilities (40,000 + 1,000) (41,000)
Net Income 174,000
Please note the following with regard to the calculation done above:
Revenue includes both the cash collected from customers and cash owed by the customers, which received later on at the end of the year.Rent has been divided by two, this is due to the fact that calculation of net income is done for the current period so only one year rent is taken.Utilities include cash paid for utilities and the amount company owed to gas & electric company.You are writing a report on the effectiveness of upper-management meetings in your company. Your first step is to determine whether to conduct an interview, carry out an observation, or administer a survey. You decide to observe one or two meetings to obtain primary data. You arrive late for the first meeting and walk into the room unannounced. What observation rule should you have followed
Answer:
Arrive early and obtain permission to observe
Explanation:
As a profession it is important to plan in advance also it is needed to demonstrate yourself in terms of an attitude and behavior this includes the organizing of the task and aimed to delivered the work by maintaining the high quality in order to meet out the objectives. In order to work effectively it is very significant to be on time.
In the given case, you have to arrive early so that you can give the brief introduction of yourself that obtain the permission for observing and shows the professionalism
A management dilemma defines the research question. Group startsTrue or FalseTrue, selectedFalse, unselected
Answer:
False
Explanation:
It is not always the case that a management dilemma results in the research question. However, a research question might be defined by an identified need for improvement.
A management dilemma defines the research question is false. The correct option is false.
A research topic is defined as "a question that a research project seeks to answer." A research question must be chosen for both quantitative and qualitative research. Data gathering and analysis will be required for the investigation, and the methods for this may vary greatly. Good research topics are usually focused and specific in order to improve understanding on an essential topic.
To formulate a research topic, one must first decide if the study will be qualitative, quantitative, or mixed. Other circumstances, such as project finance, may have an impact not only on the research topic itself, but also on when and how it is created during the research process.
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If you receive 10 units of utility from consuming one cup of coffee and 16 units of utility from consuming two cups of coffee, which of the following is the likely amount of utility you will receive from consuming three cups of coffee?
Answer:
26
Explanation:
Answer:
18
Explanation:
1 unit= 10 2 units =16 2/16= 8
3 cups is 18
One current answer to the historical struggle within management to balance the things of production and the humanity of production is social business, including the use of social media. Please indicate if the social media benefits listed below aid a thing of production or the humanity of production. Social media benefit Thing of production Humanity of production Improve efficiency Facilitate collaboration
Answer:
Humanity of production
Explanation:
Cost of goods manufactured during the year is $240,000, and work in process inventory on December 31 is $50,000. Work in process inventory during the year decreased by 60%. Total manufacturing costs incurred are
Answer:
$165,000
Explanation:
The first step is to calculate the work in process inventory
= 50,000/40/100
= 50,000/0.4
= 125,000
Therefore the total manufacturing cost can be calculated as follows
= 240,000-125,000+50,000
= 115,000+50,000
= 165,000
Hence the total manufacturing costs is $165,000
5. Microeconomics and macroeconomics Determine whether each of the following topics would more likely be studied in microeconomics or macroeconomics. Microeconomics Macroeconomics The effect of government regulation on a monopolist's production decisions The effects of the Internet on the pricing of used cars The effect of federal government spending on the national unemployment rate
Answer:
Microeconomics
Microeconomics
Macroeconomics
Explanation:
Macroeconomics is a branch of economics that studies the economy as a whole. Macroeconomics studies economic aggregates such as inflation, unemployment, GDP and growth rate.
Microeconomics is a branch of economics that studies the decisions individuals and firms make in response to changes in economic factors. These factors include price, resources etc. it studies how firms and individuals allocate and make decisions about resources
Microeconomics: The effect of government regulation on a monopolist's production decisions.
Microeconomics: The effects of the Internet on the pricing of used cars.
Macroeconomics: The effect of federal government spending on the national unemployment rate.
The effect of government regulation on a monopolist's production decisions: This topic would likely be studied in microeconomics. Microeconomics analyzes the behavior of individual firms, and the impact of government regulation on a monopolist's production decisions falls within this domain. The study would explore how government policies and regulations influence the production output, pricing strategies, and market behavior of a monopolist.
The effects of the Internet on the pricing of used cars: This topic would also be studied in microeconomics. The Internet's impact on the pricing of used cars relates to how individual buyers and sellers interact in a specific market. Microeconomics would investigate how the availability of online platforms, increased access to information, and changes in buyer-seller dynamics affect the pricing decisions of used cars.
The effect of federal government spending on the national unemployment rate: This topic would be studied in macroeconomics. Macroeconomics focuses on the overall economy and aggregates like national income, employment, and inflation. The effect of federal government spending on the national unemployment rate is a macroeconomic question that looks at how government expenditures, such as infrastructure projects or stimulus packages, can influence the overall level of unemployment in the country.
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In a market system, the allocation of scarce goods involves the consideration of multiple choice 1 what must be sacrificed in using a resource for its next-best use. identifying the possibility of professional advancement. the time required to pursue an economic activity. the dollar cost of any good or service.
Answer:
what must be sacrificed in using a resource for its next-best use
Explanation:
The market cost would be managed by the clients also it would remember the advantage that is best Also it is remembered in order to support the satisfaction to their own decisions.
So in the case of the market system, the allocation of the scarcity goods would be based on the opportunity cost i.e. to be sacrificed for the next best usage
Company C had the following investment. Help them determine the financial statement implications of the investment. Tax rate 21% Estimated tax payment 21,000 Investment cost and ending fair values for 20X1 and 20X2: 20X1 20X2 Cost 100,000 100,000 Fair value 110,000 134,000 Total gain 10,000 34,000 20X1 income statement information: Sales 1,670,200 Expenses 1,536,600 Assuming the investement is short-term, what is the ending balance of taxes payable on the 20X1 balance sheet?
Answer:
$9,156
Explanation:
Income = (Sales-expenses) + $10,000
Income = ($1,670,200 - $1,536,600) + $10,000
Total income = $143,600
Tax = Income * Tax Rate = $143,600 * 0.21 = $30,156
Now, total taxes payable is $30,156,but they estimated that payment to be $21,000, So company C has reserved $21,000 for future tax payments
So, Net deferred tax payable = $30,156 - $21,000 = $9,156. Therefore, ending balance of taxes payable on the 20X1 balance sheet is $9,156.
During the current year, Alpha sold inventory to Beta for $100,000. As of year end, Beta had resold only 60 percent of these intra-entity purchases. Alpha sells inventory to Beta at the same markup it uses for all of its customers. What is the total for consolidated cost of goods sold
Answer:
a. $173,000
Explanation:
Missing word "Alpha Company owns 80 percent of the voting stock of Beta Company. Alpha and Beta reported the following account information from their year-end separate financial records: Alpha Beta Inventory $95,000 $88,000 Sales Revenue 800,000 300,000 Cost of Goods Sold 600,000 180,000 During the current year, Alpha sold inventory to Beta for $100,000."
Percentage of profits Alpha charge to other customers = ($800,000 - $600,000) / $800,000 = 25% of sales
Stock held at year end by beta from the purchases made from Alpha = $100,000 * 40% =$40,000
Profit involved in stock held by beta from the purchases made from Alpha = $40,000 * 25% = $10,000
So, Value of stock of Beta = $88,000 - $10,000 = $78,000
Hence, Total for consolidated inventory = $95,000 + $78,000 = $173,000
d. E contributes $82,000 in cash to the business to receive a 22 percent interest in the partnership. No goodwill or other asset revaluation is to be recorded. Profits and losses have previously been split according to the following percentages: A, 10 percent; B, 30 percent; C, 20 percent; and D, 40 percent. After E makes this investment, what are the individual capital balances
Answer:
After E makes this investment, the individual capital balances are:
A = $29,073
B = $87,218
C = $58,145
D = $116,291
E = $82,000
Total = $327,727
Explanation:
a) Data and Calculations:
E's capital contribution = $82,000 for 22%
Total capital after E's admission = $372,727 ($82,000/22%)
Old profits and losses sharing ratio:
A, 10 percent; B, 30 percent; C, 20 percent; and D, 40
New profits and losses sharing ratio and new capital balances
A = 10% of 78% = 7.8% 7.8% of $372,727 = $29,073
B = 30% of 78% = 23.4% 23.4% of $372,727 = $87,218
C = 20% of 78% = 15.6% 15.6% of $372,727 = $58,145
D = 40% of 78% = 31.2% 31.2% of $372,727 = $116,291
E = 22% 22% of $372,727 = $82,000
Total = 100% $327,727
b) The capital of the partnership will total $327,727 while individual partnerships will have their capital accounts adjusted in line with the new profit sharing ratio and capital.
The board of directors of a corporation:________.
a) Are elected by the corporate registrar.
b) Are responsible for day-to-day operations of the business.
c) Do not have the power to bind the corporation to contracts, due to lack of mutual agency.
d) May not also be executive officers of the corporation, due to the separate entity principle.
e) Are responsible for and have final authority for managing corporate activities.
Answer:
e) Are responsible for and have final authority for managing corporate activities.
Explanation:
A corporation can be defined as a corporate organization that has facilities and owns or controls assets used for the production of goods and services in at least one country other than its headquarter (home office) located in its home country.
This ultimately implies that, a corporation is a corporate organization that owns or controls its business in two or more countries.
Some examples of multinational firms are Ap-ple, Volkswagen, Go-ogle, Shoprite, Nestlé, Accenture, Shell BP, Chevron etc.
An owner of a corporation is known as a stockholder and he or she can decide to sell the corporation through stocks or shares as a publicly traded firm.
Basically, the board of directors who are representing the stockholders of a corporation are responsible for and have final authority for managing corporate activities because they are typically considered to be a governing body saddled with oversight functions and responsibilities.
Webber Technologies is an emerging manufacturer of 3.5 inch diagonal touch screens for mobile communication devices/media players. 2011 industry sales were reported at 17.50 million units. This number represents an 17.7 % increase over 2010 industry sales. Webber Technologies had a 2010 market share of 5.9 %, compared with a 2011 market share of 4.2%. What was the change in unit sales for Webber Technologies, from 2010 to 2011, attributable to the change in industry sales
Answer:
Industry Sales (2011) = 17,500,000
Industry Sales (2010) = Sales of 2011/1+growth = 17,500,000/1+17.7% = 17,500,000/1.177 = $14868309.26083263 = $14,868,309.26
Company Sales (2011) = 17,500,000 * 4.2% = $735,000
Company Sales (2010) = 14,868,309.26 * 5.9% = $877,230.25
Change in units = Company sales in 2011 - Company Sales in 2010 = $735,000 - $877,230.25 = $142,230.25
Change due to change in Industry growth = Company Sales in 2010 * 17.7% = $877,230.25 * 17.7% = 155,269.75
So, there is net increase of 155,269.75 units of sales due to industry growth.
Deliberate Speed Corporation (DSC) was incorporated as a private company. The company's accounts included the following at June 30:
Accounts Payable $25,900
Buildings 118,000
Cash 46,500
Common Stock 200,000
Equipment 123,000
Land 203,000
Notes Payable (long—term) 3,700
Retained Earnings 274,700
Supplies 13,800
During the month of July, the company had the following activities:
a. Issued 6,100 shares of common stock for $610,000 cash.
b. Borrowed $114,000 cash from a local bank, payable in two years.
c Bought a building for $272,250; paid $84,250 in cash and signed a three-year note for the balance.
d. Paid cash for equipment that cost $238,000.
e. Purchased supplies for $31,250 on account.
Required:
Analyze transactions (a)-(e) to determine their effects on the accounting equation.
Answer:
I recorded the transactions on an Excel spreadsheet (see attached file)
Explanation:
Scott wants to accumulate $3,800 over a period of 11 years so that a cash payment can be made for roof maintenance on his summer cottage. To have this amount when it is needed, he will make annual deposits at the end of each year into a savings account that earns 7.0% annual interest per year. How much must each annual deposit be
Answer:
$240.76
Explanation:
The formula to determine the annual deposit is :
p = FV / annuity factor
Annuity factor = {[(1+r)^n] - 1} / r
FV = Future value
P = Present value
R = interest rate
N = number of years
Annuity factor = (1.07^11 - 1) / 0.07 = 15.783599
p = $3800 / 15.783599 = $240.76
Market intelligence research defines the____ and_____ of a market.
A.size and location
B.size and scope
C.location and scope
D.location and area
help
Answer:
dja-xizd-mku G meet code
XYZ Corporation had 158 million shares outstanding on January 1, 2012. On February 2,2012, it issued an additional 30 million shares to the market at the market priceof $55 per share. What was the effect of this share issue on the price per share
Answer:
There was no effect of this share issue on the price per share
Explanation:
First, we need to determine the pre-issuance value
Numbers of outstanding shares = 158,000,000 shares
Total Value of equity = Numbers of outstanding shares x Market value per share = 158,000,000 shares x $55 per share = $8,690,000,000
Now calculate the issuance values
Numbers of shares issued = 30,000,000 shares
Vaue of issued equity = NUmbers of shares issued x Mrket value per share = 30,000,000 x $55 per share = $1,650,000,000
Now determien the post issuance value
Numbers of outstanding shares = 158,000,000 shares + 30,000,000 shares = 188,000,000 shares
Total Value of equity = $8,690,000,000 + $1,650,000,000 = $10,340,000,000
Now calcuate the Value per share
Value per share = Post Issuance Total value of equity / Post issuance total numbers of shares = $10,340,000,000 / 188,000,000 shares = $55 per share
There is no effect of share issue on the price of the share.
Suppose in the market for lattes there is an improvement in latte technology, which allows lattes to be produced at lower costs. We can say for certain that in the latte market
A. consumer surplus will increase and total surplus will increase.
B. consumer surplus will increase but total surplus will decrease
C. consumer surplus will decrease and total surplus will increase.
D. consumer surplus will decrease and total surplus will decrease
Answer:
A. consumer surplus will increase and total surplus will increase.
Explanation:
In the case when there is an improvement in the latte technology that permits to generate at the lesser cost this would decrease the production cost that improve the profit margin as a result the production and the supply would increased
Also if the supply would rise so there is a reduction in the equilibrium price but rise in equilibrium quantity
So, the first option is correct
The ledger of Columbia, Inc. on March 31, 2014, includes the following selected accounts before adjusting entries.
Debit Credit
Prepaid Insurance 2,240
Supplies 3,120
Equipment 36,000
Unearned Service Revenue 13,600
An analysis of the accounts shows the following.
1. Insurance expires at the rate of $280 per month.
2. Supplies on hand total $960.
3. The equipment depreciates $240 per month.
4. During March, services were performed for two-fifths of the unearned service revenue.
Prepare the adjusting entries for the month of March.
Answer:
Journal 1
Debit : Insurance expense $280
Credit : Prepaid Insurance $280
Being Insurance expense recognized
Journal 2
Debit : Supplies expense $2,160
Credit : Supplies $2,160
Being Supplies Expense Recognized
Journal 3
Debit : Depreciation expense $240
Credit : Accumulated depreciation $240
Being Depreciation expenses recognized
Journal 4
Debit : Unearned Service Revenue $5,440
Credit : Service Revenue Earned $5,440
Being Service Revenue Earned being recognized
Explanation:
Expenses are decreases in income that results as an increase in liabilities and decreases in assets. Note the Decreases in Assets and Increases in Liabilities that have occurred - they represent Expenses which need to be recognized.
Service revenue is recognized when the services are actually performed, thus Reverse the Unearned Service Revenue when services are performed.
Bridges and Lloyd, an accounting firm, provides consulting and tax planning services. For many years, the firm's total administrative cost (currently $250,000) has been allocated to services on the basis of billable hours to clients. A recent analysis found that 65% of the firm's billable hours to clients resulted from tax planning services, while 35% resulted from consulting services. The firm, contemplating a change to activity-based costing, has identified three components of administrative cost, as follows: Staff Support $ 180,000 In-house computing charges 50,000 Miscellaneous office costs 20,000 Total $ 250,000 A recent analysis of staff support found a strong correlation between the number of staff personnel and the number of clients served (consulting, 20; tax planning, 60). In contrast, in-house computing and miscellaneous office cost varied directly with the number of computer hours logged and number of client transactions, respectively. Consulting consumed 30% of the firm's computer hours and had 20% of the total client transactions. If Bridges and Lloyd switched from its current accounting method to an activity-based costing system, the amount of administrative cost chargeable to consulting services would:
Answer: Decrease by $23,500
Explanation:
The Consulting cost under their current accounting system is:
= 250,000 * 35%
= $87,500
Under Activity based:
Staff support for Consulting:
20 goes to Consulting, 60 to tax planning.
Total = 20 + 60 = 80
Consulting is 20/80 of Staff support amount
= 20/80 * 180,000
= $45,000
In house computing charges for Consulting
Consulting consumed 30% of the firm's computer hours.
= 30% * 50,000
= $15,000
Miscellaneous office costs
Consulting consumed 20% of total client transactions
= 20% * 20,000
= $4,000
Total cost for Consulting under Activity based = 45,000 + 15,000 + 4,000
= $64,000
Difference = 87,500 - 64,000
= $23,500
The Mazzanti Wholesale Food Company's fiscal year-end is June 30. The company issues quarterly financial statements requiring the company to prepare adjusting entries at the end of each quarter. Assume all quarterly adjusting entries were properly recorded.
1. On December 1, 2020, the company paid its annual fire insurance premium of $7,200 for the year beginning December 1 and debited prepaid insurance.
2. On August 31, 2020, the company borrowed $115,000 from a local bank. The note requires principal and interest at 8% to be paid on August 31, 2021.
3. Mazzanti owns a warehouse that it rents to another company. On January 1, 2021, Mazzanti collected $26,400 representing rent for the 2021 calendar year and credited deferred rent revenue.
4. Depreciation on the office building is $19,200 for the fiscal year.
5. Employee salaries for the month of June 2021 $19,500 will be paid on July 20, 2021.
Required:
Prepare the necessary year-end adjusting entries at the end of June 30, 2018, for the above situations.
Answer:
1. Dr Insurance expense 1,800
Cr Prepaid insurance 1,800
2. Dr Interest expense 2,300
Cr Interest payable 2,300
3. Dr Deferred rent revenue 6,600
Cr Rent revenue 6,600
4. Dr Depreciation expense 4,800
Cr Accumulated depreciation—building 4,800
5. Dr Salaries and wages expense 19,500
Cr Salaries and wages payable 19,500
Explanation:
Preparation of the necessary year-end adjusting entries at the end of June 30, 2018, for the above situations
1. Dr Insurance expense 1,800
Cr Prepaid insurance 1,800
($7,200 × 3/12)
2. Dr Interest expense 2,300
Cr Interest payable 2,300
($115,000× 8% × 3/12)
3. Dr Deferred rent revenue 6,600
Cr Rent revenue 6,600
($26,400 × 3/12)
4. Dr Depreciation expense 4,800
Cr Accumulated depreciation—building 4,800
($19,200 × 3/12)
5. Dr Salaries and wages expense 19,500
Cr Salaries and wages payable 19,500
The following cost data relate to the manufacturing activities of Black Diamond Ski Company during 2013:
Manufacturing Overhead Costs:
Property taxes, factory $ 3,000
Utilities, factory $ 5,000
Indirect labor $10,000
Depreciation, factory $24,000
Insurance, factory $ 6,000
Total Actual Manufacturing OH Costs $48,000 Other Costs Incurred: Purchases of raw materials $32,000 Direct labor costs $40,000 The Black Diamond Ski Company used 10,200 machine hours during the period. Inventories: Raw Materials, 1/1/13 $ 8,000 Raw Materials, 12/31/13 $ 7,000 Work in Process, 1/1/13 $ 6,000 Work in Process, 12/31/13 $ 7,500 The company uses normal costing to record product costs. The company budgeted for $52,500 in total overhead costs for the year. The cost driver associated with the overhead is machine hours and the company expected to use 10,500 machine hours.
REQUIRED:
1) Compute the amount of over-applied or under-applied overhead cost for the year.
2) Determine the cost of goods manufactured for the year.
Answer:
See Below
Explanation:
1.
= Actual manufacturing overhead cost - Budgeted total overhead
Actual manufacturing overhead cost = $48,000
Budgeted total overhead = $52,500
= $48,000 - $52,500
= $4,500
The above is under applied overhead since Budgeted overhead is more than the actual overhead expended.
2. Cost of goods manufactured
Inventories ; raw materials at the beginning
$8,000
Add purchases of raw materials
$32,000
Less direct materials ending
$7,000
Direct materials used
$33,000
Direct labor cost
$40,000
Manufacturing overhead cost
$77,000
Indirect labor
$10,000
Property tax
$3,000
Utilities factory
$3,000