Answer:
a. Better high-speed rail lines.
c. Services such as web conferencing and teleconferencing that facilitate international meetings.
d. International trade agreements that lower tariffs and import quotas.
Explanation:
Better high-speed rails have improved the speed and capacity to carry goods across countries thereby enabling imports to be done with more ease. This has increased both the exports to and imports for other countries.
Information Technology has also grown to the point where international meetings can be had online which means that trade agreements and contracts can be completed quickly and with more convenience so more trade is happening between companies in the U.S. and other nations.
Also international trade agreements like the North American Free Trade Agreement (NAFTA), have lowered tariffs such that it is cheaper to both export and import than it was so both measures grew.
The company is now using only 70% of its normal capacity; it could fully use its normal capacity by processing the assembly further and selling it for $51 per unit. If the company does this, material and labor costs will each increase by $2 per unit and variable overhead will go up by $1 per unit. Fixed costs will increase from the current level of $160,000 to $225,000.
Required:
Prepare an analysis showing whether Jensen should process the assemblies further.
Answer and Explanation:
The preparation of the analysis shows whether the assemblies should process further or not is presented below:
Differential revenue (38,000 units × ($51 - $44)) $266,000
Differential costs:
Direct material (38,000units × $2 per unit) ($76,000)
Direct labor (38,000units × $2 per unit) ($76,000)
Variable overhead (38,000units × $1 per unit) ($38,000)
Fixed costs ($160,000 - $225,000) ($65,000)
Additional income (loss) from processing further $11,000
Since the amount comes in positive so it should be processed further
1. palmer luckey's backers were early adopters who enjoyed becoming part of the development process
a) true
b) false
The answer is a)True.....
Bond prices depend on the market rate of interest, stated rate of interest, and time. Determine whether the following bonds payable will be issued at face value, at a premium, or at a discount:a. The market interest rate is 4%. Denton issues bonds payable with a stated rate of 4%.b. Starkville issued 8% bonds payable when the market interest rate was 8.25%.
Answer:
a. Par value
b. Discount
Explanation:
a. As the market interest rate is 4% and the stated rate is also 4% so that means the bond would be issued at face value because both the rates are same
b. The bond rate is 8% and the market interest rate is 8.25%
so the stated interest rate is lower than the market interest rate, that means the bond would be issued at discount
hence, the same would be considered
The answer should be C. Bc clip art can have text illustrations etc!
Folklore Music manufactures harmonicas. Folklore uses standard costs to judge performance. Recently, a clerk mistakenly threw away some of the records, and only partial data for July exist. Folklore knows that the total direct labor variance for the month was $350 F and that the standard labor rate was $11 per hour. A recent pay cut caused a favorable labor rate variance of $0.40 per hour. The standard direct labor hours for actual July outputs were 5,910.
Required:
a. Find the actual number of direct labor hours worked during July. First, find the actual direct labor rate per hour. Then, determine the actual number of direct labor hours worked by setting up the computation of the total direct labor variance as given.
b. Compute the direct labor rate and efficiency variances. Do these variances suggest that the manager may have made trade-offs? Explain.
Answer: See explanation
Explanation:
a. The actual direct labor rate per hour will be:
= Standard direct labor rate per hour - favorable labor rate variance
= $11 - $0.40
= $10.60
Then, the actual direct labor hours worked during July will be calculated as:
= (5910 × $11) - $350 / $10.6
= ($65010 - $350) / $10.6
= $64660 / $10.6
= 6100
b. The direct labor rate variance will be:
= (Actual rate per hour - standard rate per hour) × Actual labor hours
= (10.60 - 11.00) × 6100
= 2440F
Direct labor efficiency variance will be:
= (6900 - 5910) × $11
= 2090U
The direct labor rate variance that was favorable shows that the manager paid a lower rate to its staffs while the direct labor efficiency variance that was unfavorable implies that the manager used less efficient workers. This indicates that a trade-off took place.
= (6900
Home Inspirations. Hailey works for her father in a family-owned business called Home Inspirations, a bedding company that has been in operation since the 1800s. When her father retires, Hailey plans on taking over the business. Hailey is aware of many things about the company that she likes, and a few things that she does not. She has particularly noted that when the economy has low unemployment and high total income, sales are great. However, at any other time, sales are not so good.
Currently, all of the bedding items are created in one place and everyone works on various tasks every day. Hailey is thinking about streamlining the production process so that individuals would be responsible for only one task. She believes that if production would increases, she could sell her products at a lower price and increase revenue. She knows that most bedding products available in the market are very similar in nature and satisfy the same need. However, if she were able to lower prices, this might give her company the competitive advantage that it needs. She would then be able to invest money in differentiating her products by providing unique features, building the brand name, and offering services such as free delivery. She is also considering selling her products on the Internet. Hailey knows that her father does not like change very much, but she feels these changes are important for the future of the company.
Hailey feels that for productivity to improve, the company must practice: _________.
a. Free enterprise,
b. Work ethics,
c. Specialization,
d. Cultural diversity,
e. Pure competition.
Answer:
c. Specialization,
Explanation:
Since in the question it is mentioned that she selling her product on the internet and she knows her father does not like the changes but she knows that it would be important for the company .
So here if she wants to improve the productivity of the product so she must practice in specialization as if the product is different from the competitor in terms of quality, price, quantity, attractiveness, etc so the chances of increasing the sales would be high
Hence, the option c is correct
Inside Incorporated was issued a charter on January 15 authorizing the following capital stock:
Common stock, $6 par, 100,000 shares, one vote per share
Preferred stock, 7 percent, par value $10 per share, 5,000 shares, nonvoting.
The following selected transactions were completed during the first year of operations in the order given:
a. Issued 21,000 shares of the $6 par common stock at $19 cash per share.
b. Issued 3,100 shares of preferred stock at $23 cash per share.
c. At the end of the year, the accounts showed net income of $39,000
Prepare the stockholders' equity section of the balance sheet at December 31
Answer:
Total stockholders' equity = $509,300
Explanation:
Before the stockholders' equity section of the balance sheet is prepared, the following are calculated first:
Common stock = Number of common shares issued * Par value of common share = 21,000 * $6 = $126,000
Additional-paid-in-capital (APIC) – Common stock = Number of common shares issued * (Common stock cash per share - Par value of common share) = 21,000 * ($19 - $6) = $273,000
Preferred stock = Number of preferred stock issued * Par value of preferred stock = 3,100 * $10 = 31,000
APIC – Preferred stock = Number of preferred stock issued * (Preferred stock cash per share - Par value of preferred stock) = 3,100 * ($23 - $10) = $40,000
Therefore, the stockholders' equity section of the balance sheet at December 31 can now be prepared as follows:
Inside Incorporated
Balance Sheet (Partial)
At December 31
Details $
Stockholders' equity:
Common stock 126,000
APIC – Common stock 273,000
Preferred stock 31,000
APIC – Preferred stock 40,000
Net income 39,000
Total stockholders' equity 509,300
Leandro Corp. manufactures wooden desks. Production consists of three processes: cutting, assembly, and finishing. The following costs are given for April: Cutting Assembly Finishing direct materials $7,000 $10,000 $3,000 direct labor 3,000 14,000 2,000 applied overhead 4,000 5,000 6,000 There were no work in process inventories and 1,000 podiums were produced. What is the cost transferred out of the assembly department. a.$29,000 b.$43,000 c.$54,000 d.$14,000 e.None of these choices are correct.
Answer:
a. $29,000
Explanation:
With regards to the above, the cost transferred out of the assembly department is computed as;
We would sum up all the cost associated with the Assembly department.
= Direct materials + Direct labor + Overhead
Direct materials = $10,000
Direct labor = $14,000
Overhead = $5,000
Therefore, cost transfered out of the assembly department is
= $10,000 + $14,000 + $5,000
= $29,000
what organization or program interests you the most?
Answer:
I love law :) what about you
I love math what do you like
Ps; sorry but may you please mark brainly im trying to level up
Marshall Welding Company has two service departments (Cafeteria and Human Resources) and two production departments (Machining and Assembly). The number of employees in each department follows. Cafeteria 20 Human Resources 30 Machining 100 Assembly 150 Marshall Welding uses the step-down method of cost allocation and allocates cost on the basis of employees. Human Resources cost amounts to $1,200,000, and the department provides more service to the firm than Cafeteria. How much Human Resources cost would be allocated to Machining
Answer:
the cost of Human Resources would be allocated to Machining is $480,000
Explanation:
The computation of the cost of Human Resources would be allocated to Machining is given below:
= Cost of the human resource × machining department ÷ (machining department + assembly department)
= $1,200,000 × 100 ÷ (100 + 150)
= $480,000
hence, the cost of Human Resources would be allocated to Machining is $480,000
Smith Company makes jars of homemade strawberry jam. Each jar is priced at $6.00 per unit. The costs of the ingredients to make each jar are $2.00. The containing jar itself costs $1.00. The company has monthly expenses of $2,000 for rent and insurance, $300 for heat and electricity, and $5,000 in monthly salary expenses. Last month the company sold 3,000 jars. What is the UNIT VARIABLE COST per jar
Answer:
Total variable cost= $1.97
Explanation:
Giving the following information:
The cost of the ingredients to make each jar is $2.00.
The containing jar itself costs $1.00.
$300 for heat and electricity
$5,000 in monthly salary expenses.
Generally, the salary expense and electricity are mixed costs (fixed and variable components). In this case, we will treat them as a full variable cost.
Unitary Electricity= 300 / 3,000= $0.1
Unitary direct labor= 5,000 / 3,000= $1.67
Now, the total variable cost:
Total variable cost= 2 + 1 + 0.1 + 1.67
Total variable cost= $1.97
Match each phrase that follows with the term it describes.
1. Budget
2. Capital expenditures budget
3. Sales budget
4. Production budget
5. Cash budget
6. Budgeted balance sheet
A. an accounting report that presents predicted amounts of the company's assets, liabilities, and equity as of the end of the budget period
B. plans an important role for organizations in planning, directing, and controlling a company's future goals
C. a plan showing the units of goods to be sold and the sales to be derived; usually the starting point in the budgeting process
D. a plan that lists dollar amounts to be both spent on purchasing additional pant assets to carry out the budgeted business activities
E. a plan showing the number of units to be produced each month
F. a plan that shows the expected cash inflows and outflows during the budget period, including receipts from loans needed to maintain a minimum cash balance and repayments of such loans
Answer and Explanation:
The matching is as follows:
1. Budget - B. It would be play a significant role with respect to planning, directing, controlling for an upcoming goals of the company
2. Capital expenditure budget -D. As the capital expenditure is the one time expenditure that should be done for purchasing the extra plant asset
3. Sales budget - C. The plan that represent the sales unit and the sales value.
4. Production budget - E. The budget that represent the no of units produced each month
5. Cash budget - F. It represent the cash inflows and cash outflow position
6. Budgeted balance sheet - A. It involved the assets, liabilities and stockholder equity
Alan Krueger conducted a survey of fans at the 2001 Super Bowl who purchased tickets to the game for $325 or $400. Krueger found that (a) 94 percent of those surveyed would not have paid $3,000 for their tickets, and (b) 92 percent of those surveyed would not have sold their tickets for $3,000. These results are an example of A. the failure to ignore sunk costs. B. rational consumer behavior. C. the endowment effect. D. the fallacy of composition.
Answer:
C. the endowment effect
Gamegirl Inc., has the following transactions during August. August 6 Sold 72 handheld game devices for $210 each to DS Unlimited on account, terms 2/10, net 60. The cost of the 72 game devices sold, was $190 each. August 10 DS Unlimited returned seven game devices purchased on 6th August since they were defective. August 14 Received full amount due from DS Unlimited.
Required:
Prepare the transactions for GameGirl, Inc., assuming the company uses a perpetual inventory system.
Answer:
Aug 6
Dr Accounts Receivable $15,120
Cr Sales $15,120
Dr Cost of Goods Sold $13,680
Cr Inventory $13,680
Aug 10
Dr Sales Return $1,470
Cr Accounts Receivable $1,470
Aug 14
Dr Cash $13,513
Dr Sales Discount $137
Cr Accounts Receivable $13,650
Explanation:
Preparation of the transactions for GameGirl, Inc., assuming the company uses a perpetual inventory system.
Aug 6 Accounts Receivable $15,120
Sales $15,120
(72*$210)
Dr Cost of Goods Sold $13,680
Cr Inventory $13,680
(72*$190)
Aug 10
Dr Sales Return $1,470
Cr Accounts Receivable $1,470
(7*$210)
Aug 14
Dr Cash $13,513
($13,650-$137)
Dr Sales Discount $137
Cr Accounts Receivable $13,650
Computation of Sales Discount:
Sales $15,120
Less: Sales Return $1,470
Total Sales $13,650
Multiply: Percentage of Discount 1%
Sales Discount $137
Milano Pizza Club owns three identical restaurants popular for their specialty pizzas. Each restaurant has a debt–equity ratio of 35 percent and makes interest payments of $53,000 at the end of each year. The cost of the firm’s levered equity is 20 percent. Each store estimates that annual sales will be $1.54 million; annual cost of goods sold will be $790,000; and annual general and administrative costs will be $525,000. These cash flows are expected to remain the same forever. The corporate tax rate is 40 percent.
Use the flow to equity approach to determine the value of the company’s equity.
What is the total value of the company?
Answer:
A. $516,000
B. $696,600
Explanation:
A. Calculation to to determine the value of the Company's equity
First step is to calculate the Net income
Sales1,540,000
Less: Cost of goods sold790,000
Less: General and administrative costs525,000
Less: Interest expenses53,000
Income before corporate tax 172,000
Less: Corporate tax 40% 68,800
(40%*172,000)
Net income103,200
(172,000-68,800)
Now let determine the value of the Company's equity using this formula
Value of the Company's equity
= Net income/ cost of the firm’s levered equity
Let plug in the formula
Value of the Company's equity = $103,200/0.20
Value of the Company's equity = $516,000
Therefore The Value of the Company's equity is $516,000
B. Calculation to determine the total value of Company equity
First step is to calculate the Debt
Debt equity Ratio = 0.35
Debt/Equity = 0.35
Debt/ $516,000 = 0.35
Debt = $516,000 * 0.35
Debt =$180,600
Now let determine The Company’s value using this formula
Company’s Total value = Equity + Debt
Let plug in the formula
Company’s Total value = $516,000 + $180,600
Company’s Total value = $696,600
Therefore the total value of Company equity is $696,600
Hill Corporation issued $2,100,000 of 8% bonds at 98 on January 2, 2019. Interest is paid semiannually on June 30 and December 31. The bonds had a 10-year life from the date of issue, and the company uses the straight-line method of amortization. On March 31, 2022, Hill recalls the bonds at the call price of 107 plus accrued interest.
Required:
Prepare the journal entries to record the reacquisition (recall) of Hill's bonds.
Answer:
Hill Corporation
Journal Entries
March 31, 2022:
Debit Bond Liability $2,247,000
Debit Interest Payable $42,000
Credit Cash $2,289,000
To record the recall of the bonds, including accrued interest.
Explanation:
a) Data and Calculations:
January 2, 2019: Face value of bonds issued = $2,100,000
Proceeds from the issue of the bonds at 98 = 2,058,000
Discount from the issue = $42,000
Semi-annual amortization under straight-line = $2,100 ($42,000/20)
Coupon interest rate = 8% with payment made semiannually
Annual interest payment = $168,000 ($2,100,000 * 8%)
Semiannual interest payment = $84,000 ($2,100,000 * 4%)
Bonds duration = 10 years
March 31, 2022 Recall price of 107 = $2,247,000
Accrued interest from January 1 to March 31 = $42,000
Total payment to bondholders = $2,289,000
Clare, a florist, opened a new store and wanted to purchase a new refrigeration display cabinet for fresh-flower arrangements. She entered into a deal with Alpha Refrigeration Systems for two refrigeration units at $600 each. But, after delivering the units, the salesperson demanded another $100 as delivery charges, which was not mentioned in the deal. Identify the win-lose strategy used by the salesperson.
The question is incomplete:
Clare, a florist, opened a new store and wanted to purchase a new refrigeration display cabinet for fresh-flower arrangements. She entered into a deal with Alpha Refrigeration Systems for two refrigeration units at $600 each. But, after delivering the units, the salesperson demanded another $100 as delivery charges, which was not mentioned in the deal. Identify the win-lose strategy used by the salesperson.
-Good guy-bad guy routine
-Browbeating
-Red herring
-Trial balloon
-Lowballing
Answer:
-Red herring
Explanation:
-Goog buy-bad guy routine is a strategy in which one person appears to be on your side and when you get to an agreement, this person goes to the bad guy for approval who will renegotiate.
-Browbeating is a strategy in which the buyer tries to affect the saleperson atittude by saying unflattering things.
-Red herring is a strategy in which one of the parties tries to distract the other one from certain isues to get an advantage.
-Trial balloon is an strategy in which one of the parties says something to the other one to get information about its position in the negotiation.
-Lowballing is an strategy in which the buyer makes a really low offer to test the seller.
According to the definitions, the answer is that the win-lose strategy used by the salesperson is red herring because Clara didn't consider the information related to the delivery when purchasing the units as she was probably distracted by other aspects and didn't consider this.
Buddy's Burger Barn purchased produce for the week from one of its
suppliers. The business's accountant credited the Accounts Payable account
for $150. How will this purchase impact the balance sheet?
A. It will be subtracted from the total balance of Accounts Payable,
and then transferred to the Current Liabilities section of the
balance sheet.
B. It will be added to the total balance of Accounts Payable, and then
regarded as cash on hand on the balance sheet.
C. It will be added to the total balance of Accounts Payable, and then
transferred to the Current Liabilities section of the balance sheet.
D. It will be subtracted to the total balance of Accounts Payable, and
then regarded as cash on hand on the balance sheet.
Answer:
thanks bro your wrong the answer is
C.) it will be added to the total balance of accounts payable, and then transferred to the current liabilities section of the balance sheet.
Hoyle Company owns a manufacturing plant with a fair value of $4,600,000, a recorded cost of $8,500,000, and accumulated depreciation of $3,650,000. Patterson Company owns a warehouse with a fair value of $4,400,000, a recorded cost of $6,900,000, and accumulated depreciation of $2,800,000. Hoyle and Patterson exchange assets, with Hoyle also receiving cash of $200,000 from Patterson. The exchange is considered to have commercial substance.
Required:
Record the exchange on the books of:
a. Hoyle
b. Patterson
Answer:
A. Hoyle
Dr Warehouse $4,400,000
Dr Cash $200,000
Dr Accumulated depreciation $3,650,000
Dr Loss on sale of asset $250,000
Cr Manufacturing plant $8,500,000
B. Patterson
Dr Manufacturing plant $4,600,000
Dr Accumulated depreciation $2,800,000
Cr Gain on sale of asset
$300,000
Cr Warehouse $6,900,000
Cr Cash $200,000
Explanation:
A. Preparation of the Jounal entry to Record the exchange on the books of Hoyle
Dr Warehouse $4,400,000
Dr Cash $200,000
Dr Accumulated depreciation $3,650,000
Dr Loss on sale of asset $250,000
(8,500,000-4,400,000-200,000-3,650,000)
Cr Manufacturing plant $8,500,000
B. Preparation of the Jounal entry to Record the exchange on the books of Patterson
Dr Manufacturing plant $4,600,000
Dr Accumulated depreciation $2,800,000
Cr Gain on sale of asset
$300,000
(4,600,000+2,800,000-6,900,000-200,000)
Cr Warehouse $6,900,000
Cr Cash $200,000
Utilize the following financial information to answer the question. Current value of land $2,000,000 Cost to rebuild the physical structure $7,500,000 Furniture, fixtures and equipment $ 500,000 Economic deductions $ 800,000 Functional obsolescence $ 200,000 Physical deterioration $1,000,000 Based on the cost replacement approach, how much would be estimated value of the property
Answer: $8,000,000
Explanation:
Based on the cost replacement approach:
Estimated value = Land Value + Replacement Value - Deductions from value
Replacement value = Cost to rebuild physical structures + Furniture
= 7,500,000 + 500,000
= $8,000,000
Economic deductions:
= 800,000 + 200,000 + 1,000,000
= $2,000,000
Estimated value = 2,000,000 + 8,000,000 - 2,000,000
= $8,000,000
3. The price elasticity of demand for wine is estimated to be 1 at all possible quantities. Currently, 200 million gallons of wine are sold per year, and the price averages $6 per bottle. Assuming that the price elasticity of supply of wine is 1 and the current tax rate is $1 per bottle, calculate the current excess burden of the tax on wine. Suppose the tax per bottle is increased to $2 per bottle. What will happen to the excess burden of the tax as a result of the tax increase
Answer:
The excess burden would quadruple to $33,333
Explanation:
In order to calculate the excess burden as a result of the tax increase, we first calculate the excess burden at current tax rate which is $1 per bottle. Excess burden is calculated using the following formulae:
W = 1/2(T)²(Q/P) x (Es x Ed / (Es - Ed))
where:
T = Tax per unit
Q = Total Quantity
P = Price per unit
Es = Elasticity of Supply
Ed = Elasticity of Demand
W = 1/2(1)² (200,000/6) x (1 x 1 / (1 - (-1)))
W = 1/2 (33.333) x (1/2)
W = $8,333
Now after-tax rate goes up to $2, the excess burden would as follow:
W = 1/2(2)² (200,000/6) x (1 x 1 / (1 - (-1)))
W = 2 (33.333) x (1/2)
W = $33,333 per year
Hence, the excess burden is $33,333 after the increase in tax.
A band sells shirts, CDs, and other merchandise online. They are using Excel to track sales by date and by name
of the buyer. They would like for any purchases over $50 to be highlighted automatically so that they can send a
special gift to those buyers.
Which is the best way to make Excel automatically highlight these sales?
Answer:
its 3
Explanation:
Condensed financial data are presented below for the Phoenix Corporation: 20X2 20X1 Accounts receivable $ 267,500 $ 230,000 Inventory 312,500 257,500 Total current assets 670,000 565,000 Intangible assets 50,000 60,000 Total assets 825,000 695,000 Current liabilities 252,500 200,000 Long-term liabilities 77,500 75,000 Sales 1,640,000 Cost of goods sold 982,500 Interest expense 10,000 Income tax expense 77,500 Net income 127,500 Cash flow from operations 71,000 Cash flow from investing activities (6,000 ) Cash flow from financing activities (62,500 ) Tax rate 30 % If the intangible assets in 20X2 are $50,000, then the long-term debt to tangible assets for 20X2 is:
Answer:
Phoenix Corporation
The long-term debt to tangible assets for 20X2 is:
= 0.74.
Explanation:
a) Data and Calculations:
20X2 20X1
Accounts receivable $ 267,500 $ 230,000
Inventory 312,500 257,500
Cash 90,000 77,500
Total current assets 670,000 565,000
Intangible assets 50,000 60,000
Tangible assets 105,000 70,000
Total assets 825,000 695,000
Current liabilities 252,500 200,000
Long-term liabilities 77,500 75,000
Equity 495,000 420,000
Total liabilities/Equity 825,000 695,000
Income Statement for year 20X2
Sales 1,640,000
Cost of goods sold 982,500
Gross profit 657,500
Operating expenses 442,500
EBIT 215,000
Interest expense 10,000
Pretax income 205,000
Income tax expense 77,500
Net income 127,500
Statement of Cash Flows:
Cash flow from operations 71,000
Cash flow from investing activities (6,000 )
Cash flow from financing activities (62,500 )
Net cash flows = 2,500
Tax rate 30 %
Long-term debt to Tangible assets = 77,500/105,000 = 0.74
b) This ratio describes the percentage of the tangible assets financed by long-term debts. It is a financial leverage ratio. The computation compares the long-term debts to the tangible assets.
Benson Company estimates its uncollectible accounts by aging its accounts receivable and applying percentages to various aged categories of accounts. Benson computes a total of $1,800 in estimated uncollectible accounts as of December 31, 2013. Its Accounts Receivable account has a balance of $56,400 and its Allowance for Doubtful Accounts has a credit balance of $300 before adjustment at December 31, 2013. How much bad debts expense will Benson report in 2013
Answer:
$1,500
Explanation:
With regards to the above, we would compute Benson's Company bad debt expense for 2013 as;
= Estimated uncollectible accounts as of 31, December 2013 - Credit balance in the allowance for doubtful account before adjustment at December 31, 2013.
= $1,800 - $300
= $1,500
Therefore, Benson Company would report $1,500 as bad debts expense in 2013.
A sporting goods manufacturer budgets production of 59,000 pairs of ski boots in the first quarter and 50,000 pairs in the second quarter of the upcoming year. Each pair of boots requires 2 kilograms (kg) of a key raw material. The company aims to end each quarter with ending raw materials inventory equal to 20% of the following quarter's material needs. Beginning inventory for this material is 23,600 kg and the cost per kg is $8. What is the budgeted materials purchases cost for the first quarter?
Answer:
Purchases= 114,400 kg
Total purchase cost= $915,200
Explanation:
Giving the following information:
Beginning inventory= 23,600 kg
Cost per kg= $8
Production= 59,000 pairs
Desired ending inventory= (50,000*0.2)*2= 20,000 kg
To calculate the purchases, we need to use the following formula:
Purchases= production + desired ending inventory - beginning inventory
Purchases= 59,000*2 + 20,000 - 23,600
Purchases= 114,400 kg
Total purchase cost= 114,400*8= $915,200
Fore Farms reported a pretax operating loss of $210 million for financial reporting purposes in 2021. Contributing to the loss were (a) a penalty of $10 million assessed by the Environmental Protection Agency for violation of a federal law and paid in 2021 and (b) an estimated loss of $20 million from accruing a loss contingency. The loss will be tax deductible when paid in 2022. The enacted tax rate is 25%. There were no temporary differences at the beginning of the year and none originating in 2021 other than those described above. Required: 1. Prepare the journal entry to recognize the income tax benefit of the net operating loss in 2021. 2. What is the net operating loss reported in 2021 income statement
Answer:
Fore Farms
1. Journal Entry
Debit Net operating loss $180 million
Credit Loss Carryforward Relief $180 million
To record the income tax benefit of the net operating loss.
2. The net operating loss reported in 2021 income statement is $180 million.
Explanation:
a) Data and Calculations:
Enacted tax rate = 25%
2021 Reported pretax operating loss = $210 million
Less:
Penalty for EPA violation = 10 million
Loss contingency accrued
(temporary difference) = 20 million
Net pretax operating loss = $180 million
b) The net operating loss (NOL) suffered by Fore Farms, after adjusting non-allowable penalty for EPA violation and temporary differences, will be used to offset the company's tax payments in subsequent tax periods. This is an Internal Revenue Service (IRS) tax provision called a "loss carryforward." It allows some tax relief to Fore Farms for losing money in 2021.
Factory Overhead Cost Variances The following data relate to factory overhead cost for the production of 8,000 computers: Actual: Variable factory overhead $101,750 Fixed factory overhead 180,000 Standard: 8,000 hrs. at $31 248,000 If productive capacity of 100% was 10,000 hours and the factory overhead cost budgeted at the level of 8,000 standard hours was $284,000, determine the variable factory overhead controllable variance, fixed factory overhead volume variance, and total factory overhead cost variance. The fixed factory overhead rate was $18 per hour. Enter a favorable variance as a negative amount, and an unfavorable variance as a positive amount. Variance Amount Favorable/Unfavorable Controllable $fill in the blank 1 Volume fill in the blank 3 Total factory overhead cost variance $fill in the blank 5
Answer:
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Income from installment sales of properties included in pretax accounting income in 2021 exceeded that reported for tax purposes by $7 million. The installment receivable account at year-end 2021 had a balance of $8 million (representing portions of 2020 and 2021 installment sales), expected to be collected equally in 2022 and 2023. Sherrod was assessed a penalty of $2 million by the Environmental Protection Agency for violation of a federal law in 2021. The fine is to be paid in equal amounts in 2021 and 2022. Sherrod rents its operating facilities but owns one asset acquired in 2020 at a cost of $112 million. Depreciation is reported by the straight-line method, assuming a four-year useful life. On the tax return, deductions for depreciation will be more than straight-line depreciation the first two years but less than straight-line depreciation the next two years ($ in millions):
Answer:
1. Taxable income = $76 million
2. Net income = $65.25 million
3-a. Net current Deferred Tax Asset = $1.95 million
3-b. Net current Deferred Tax Liability = $6.25 million
Explanation:
Note: This question is not complete. The complete question is therefore provided before answering the question. See the attached pdf file for the complete question.
The explanation of the answers I now provided as follows:
1. Determine the amounts necessary to record income taxes for 2021, and prepare the appropriate journal entry.
1-a. Note: See the attached excel file for the determination of the amounts necessary to record income taxes for 2021 and the taxable income.
From the attached excel file, we have:
Taxable income = $76 million
1-b. The journal entries will look as follows:
Details Debit ($'m) Credit ($'m)
Tax expense (6.75 + 19 - 3) 22.75
Deferred tax asset (25% * (1 + 13 - 2)) 3.00
Deferred tax liability (25% * (7 + 20)) 6.75
Tax payable (25% * 76) 19.00
(To record tax expense.)
2. What is the 2021 net income?
This can be determined as follows:
Net income = Pretax accounting income - Tax expense = $88 million - $ 22.75 million = $65.25 million
3. Show how any deferred tax amounts should be classified and reported in the 2021 balance sheet.
3-a. The deferred tax amounts should be classified as follows.
From installment receivable in point (a) in the question:
Current deferred tax liability in 2022 (25%* ($4 / 2)) = $1
Noncurrent deferred tax liability in 2023 (25%* ($4 / 2)) = $1
From the depreciation in point (c.) in the question:
Noncurrent deferred tax liability (25%* ((24 + 24) - (14 + 7))) = $6.75
From the Warranty Expense/Payable in point (d.) of the question:
Current deferred tax asset (40%* 3) = $1.20
From the Acrrued Expense/Payable in point (e.) of the question:
Current deferred tax asset (25%* 7) = $1.75
Noncurrent deferred tax liability (25% * $6) = $1.50
3-b. These will be reported reported in the 2021 balance sheet as follows:
Sherrod, Inc.,
Balance Sheet (Partial)
As the Year Ended 31 December, 2021
Details $'Million
Assets:
Current Deferred Tax Asset (1.20 + 1.75) 2.95
Current Deferred Tax Liability -1.00
Net current Deferred Tax Asset 1.95
Liabilities:
Noncurrent Deferred Tax Asset (A) 1.50
Noncurrent Deferred Tax Liabiity (1.0 + 6.75) (B) 7.75
Net current Deferred Tax Liability (C = B - A) 6.25
3. Suppose you are thinking of purchasing the Moore Co.’s common stock today. If you expect Moore to pay $3.1, $3.38, $3.70, $4.02, and $4.38 dividends at the end of year one, two, three, four, and five respectively and you believe that you can sell the stock for $95 at the end of year five. If you required return on this investment is 11%, how much will you be willing to pay for the stock today?
Answer:
$69.87
Explanation:
The price i would be willing to pay for the stock can be determined by finding the present value of the dividend payments
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow in year 1 = 3.1
Cash flow in year 2 = 3.38
Cash flow in year 3 = 3.70
Cash flow in year 4 = 4.02
Cash flow in year 5 = 4.38 + 95 = 99.38
I = 11%
Present value = $69.87
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
Liang Company began operations in Year 1. During its first two years, the company completed a number of transactions involving sales on credit, accounts receivable collections, and bad debts. These transactions are summarized as follows.
Year 1
a. Sold $1,352,600 of merchandise (that had cost $976,400) on credit, terms n/30.
b. Wrote off $20,100 of uncollectible accounts receivable.
c. Received $674,300 cash in payment of accounts receivable.
d. In adjusting the accounts on December 31, the company estimated that 2.80% of accounts receivable would be uncollectible.
Year 2
a. Sold $1,552,800 of merchandise (that had cost $1,325,200) on credit, terms n/30.
b. Wrote off $31,300 of uncollectible accounts receivable.
c. Received $1,282,200 cash in payment of accounts receivable.
d. In adjusting the accounts on December 31, the company estimated that 2.80% of accounts receivable would be uncollectible.
Required:
Prepare journal entries to record Liang's year 1 and year 2 summarized transactions and its year-end adjustments to record bad debts expense. (The company uses the perpetual inventory system and it applies the allowance method for its accounts receivable.)
Answer:
Liang Company
Journal Entries:
a. Debit Accounts receivable $1,352,600
Credit Sales revenue $1,352,600
To record the sale of goods on credit, terms n/30.
Debit Cost of goods sold $976,400
Credit Inventory $976,400
To record the cost of goods sold.
b. Debit Allowance for Uncollectible Accounts $20,100
Credit Accounts receivable $20,100
To write-off uncollectible accounts.
c. Debit Cash $674,300
Credit Accounts receivable $674,300
To record the receipt of cash on account.
d. Debit Bad Debts Expense $38,530
Credit Allowance for Uncollectible $38,530
To record bad debts expense and bring the ending balance of the Allowance for Uncollectible accounts to a credit balance of $18,430 (2.80% of accounts receivable ($658,200))
Year 2
a. Debit Accounts receivable $1,552,800
Credit Sales revenue $1,552,800
To record the sale of goods on credit, terms n/30.
Debit Cost $1,325,200
Credit Inventory $1,325,200
To record the cost of goods sold on account.
b. Debit Allowance for Uncollectible Accounts $31,300
Credit Accounts receivable $31,300
To write-off uncollectible accounts.
c. Debit Cash $1,282,200
Credit Accounts receivable $1,282,200
To record the receipt of payment on account.
d. Debit Bad Debts Expense $38,000
Credit Allowance for Uncollectible $38,000
To record bad debts expense and bring the ending balance of the Allowance for Uncollectible Accounts to a credit balance of $25,130 (2.80% of accounts receivable ($897,500))
Explanation:
Data and Analysis:
Year 1:
a. Accounts receivable $1,352,600 Sales revenue %1,352,600
on credit, terms n/30.
Cost of goods sold $976,400 Inventory $976,400
b. Allowance for Uncollectible Accounts $20,100 Accounts receivable $20,100
c. Cash $674,300 Accounts receivable $674,300
d. Bad Debts Expense $38,530 Allowance for Uncollectible $38,530 ending balance $18,430 (2.80% of accounts receivable ($658,200))
Year 2
a. Accounts receivable $1,552,800 Sales revenue $1,552,800
on credit, terms n/30.
Cost $1,325,200 Inventory $1,325,200
b. Allowance for Uncollectible Accounts $31,300 Accounts receivable $31,300
c.Cash $1,282,200 Accounts receivable $1,282,200
d. Bad Debts Expense $38,000 Allowance for Uncollectible $38,000
Ending balance $25,130 2.80% of accounts receivable ($897,500)