Answer:
1. Standard quantity of labor-hours allowed 4,800
2. Standard variable overhead cost allowed $15,600
3. Variable overhead spending variance 5,200 U
4. Variable overhead rate variance 325 F
5.Variable overhead efficiency variance 5,525 U
Explanation:
1. Calculation for Standard quantity of labor-hours allowed
Standard quantity of labor-hours allowed = 160,000*0.03
Standard quantity of labor-hours allowed= 4,800
Therefore Standard quantity of labor-hours allowed is 4,800
2. Calculatuon for Standard variable overhead cost allowed
Standard variable overhead cost allowed= 4,800*$3.25
Standard variable overhead cost allowed = $15,600
Therefore the Standard variable overhead cost allowed is $15,600
3. Calculation for Variable overhead spending variance
Variable overhead spending variance = $15,600 - $20,800
Variable overhead spending variance = 5,200 U
Therefore the Variable overhead spending variance is 5,200 U
4. Calculation for Variable overhead rate variance
Variable overhead rate variance= ($3.25 - $20,800/6,500)*6,500
Variable overhead rate variance=($3.25-$3.2)*6,500
Variable overhead rate variance= 325 F
Therefore The Variable overhead rate variance= 325 F
5. Calculation for Variable overhead efficiency variance
Variable overhead efficiency variance= (4,800-6,500)*3.25
Variable overhead efficiency variance = 1,700*3.25
Variable overhead efficiency variance= 5,525
Therefore the Variable overhead efficiency variance is 5,525 U
Barrington Industries anticipated selling 29,000 units of a major product and paying sales commissions of $6 per unit. Actual sales and sales commissions totaled 31,500 units and $182,700, respectively. If the company used a static budget for performance evaluations, Barrington would report a cost variance of: Multiple Choice $6,300U. $6,300F. $8,700U. $8,700F. None of the answers is correct.
Answer:
Barrington would report $8,700U cost variance.
Explanation:
This can be calculated as follows:
Actual sales commissions = $182,700
Budgeted sales commissions = Anticipated sales units * commissions of per unit = 29,000 * $6 = $174,000
Sales commission cost variance = Actual sales commissions - Budgeted sales commissions = $182,700 - $174,000 = $8,700U
Since the Actual sales commissions is greater than Budgeted sales commissions, the cost variance is unfavourable and Barrington would report $8,700U cost variance.
Organizations face myriad barriers and obstacles to effectively increasing and embracing diversity in their workplaces. Some of these barriers stem from people in the organization who are resistant to changing the organization to make it more diverse. This activity is important because resistance to this type of change is an attitude that managers will come up against frequently, and managers should be able to recognize when this occurs so that they can manage the organization and its employees through this challenging but very important type of change.
The goal of this exercise is to challenge your knowledge of the barriers to diversity.
Stereotypes and Prejudices
Fear of Discrimination Against Majority Group Members
Resistance to Diversity Program Priorities
A Negative Diversity Climate
Lack of Support for Family Demands
A Hostile Work Environment for Diverse Employees
First, hover over the terms to read examples of barriers to diversity in action. Then, click and drag each term to indicate the specific barrier to diversity its example best depicts.
Answer:
Stereotypes
- Resistant to diversity program priorities
- Lack of support for family demands
Prejudices
- Fear of discrimination against majority group members
- A negative diversity climate
- A hostile work environment for diverse employees
Explanation:
Examples for stereotypes and prejudices are given below
Stereotypes
- Resistant to diversity program priorities
- Lack of support for family demands
Prejudices
- Fear of discrimination against majority group members
- A negative diversity climate
- A hostile work environment for diverse employees
To be effective issuing and investing in bonds, knowledge of their terminology, characteristics, and features is essential. For example: • A bond’s is generally $1,000 and represents the amount borrowed from the bond’s first purchaser. • A bond issuer is said to be in if it does not pay the interest or the principal in accordance with the terms of the indenture agreement or if it violates one or more of the issue’s restrictive covenants. • A bond contract feature that requires the issuer to retire a specified portion of the bond issue each year is called a . • A bond’s gives the issuer the right to call, or redeem, a bond at specific times and under specific conditions. Suppose you read an article about the Golden Gate Bridge and Highway District bonds. It includes the following information:esvoe37f387cf9b3627f11119053e024693f8affde5624e3d681c11860b391bb47ca1eovse What is the coupon interest rate of this bond
Answer: See explanation
Explanation:
A bond’s (face value) is generally $1,000 and represents the amount borrowed from the bond’s first purchaser.
A bond issuer is said to be in (default) if it does not pay the interest or the principal in accordance with the terms of the indenture agreement or if it violates one or more of the issue’s restrictive covenants.
A bond contract feature that requires the issuer to retire a specified portion of the bond issue each year is called a (sinking fund provision).
A bond’s (call provision) gives the issuer the right to call, or redeem, a bond at specific times and under specific conditions.
The face value is the dollar value of a security, or a stock's original cost. Default means when the bond issuer doesn't agree with the stated terms of the bond.
Which describes the role of automatic stabilizers in the economy? Automatic stabilizers are changes in the money supply that occur automatically when inflation or unemployment occurs. Automatic stabilizers refer to industries that are not subject to the fluctuations of the economy, and therefore moderate the effects of recessions. Food, housing, and the military are examples of these industries, which are usually more stable than the rest of the economy. Automatic stabilizers have a similar impact as discretionary fiscal policy but occur automatically, without action by the government. Automatic stabilizers increase aggregate demand during recessions and reduce aggregate demand during expansions. Automatic stabilizers are discretionary changes to taxes, government spending, and transfers that Congress makes in an attempt to improve the economy.
Answer:
person above is 100% correct
Explanation:
The Mighty Music Company produces and sells a desktop speaker for $100. The company has the capacity to produce 50,000 speakers each period. At capacity, the costs assigned to each unit are as follows: Unit level costs $ 45 Product level costs $ 15 Facility level costs $ 5 The company has received a special order for 500 speakers. If this order is accepted, the company will have to spend $15,000 on additional costs. Assuming that no sales to regular customers will be lost if the order is accepted, at what selling price will the company be indifferent between accepting and rejecting the special order
Answer:
$75
Explanation:
Calculation to determine what selling price will the company be indifferent between accepting and rejecting the special order
Using this formula
Selling price between accepting and rejecting the special order= ( Additional cost ÷ Units sold number) + Unit level Cost
Let plug in the formula
Selling price between accepting and rejecting the special order= ( $15,000 ÷ 500 ) + $45
Selling price between accepting and rejecting the special order= $30 + $45
Selling price between accepting and rejecting the special order= $75
Therefore The selling price that the company will be indifferent between accepting and rejecting the special order is $75
Med Max buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to dozens of hospitals. In the face of declining profits, Med Max decided to implement an activity-based costing system to improve its understanding of the costs incurred to serve each hospital. The company broke its selling and administrative expenses into four activities as shown below:
Activity Cost Pool (Activity Measure) Total Cost Total Activity
Customer deliveries (Number of deliveries) $630,000 7,000 deliveries
Manual order processing (Number of manual orders) 444,000 6,000 orders
Electronic order processing (Number of electronic orders) 231,000 11,000 orders
Line item picking (Number of line items picked) 955,500 490,000 line items
Other organization-sustaining costs (None) 610,000
Total selling and administrative expenses $2,870,500
Med Max gathered the data below for two of the many hospitals that it serves—City General and County General:
Activity
Activity Measure General City County General
Number of deliveries 10 20
Number of manual orders 0 40
Number of electronic orders 10 0
Number of line items picked 120 280
Required:
a. Compute the activity rate for each activity cost pool.
b. Compute the total activity costs that would be assigned to City General and County General.
Answer:
A. Customer deliveries $90
Manual order processing $74
Electronic order processing $21
Line item picking $1.95
B. CITY GENERAL
Activity cost pools City General
Customer deliveries $900
Manual order processing $0
Electronic order processing $210
Line item picking $234
Total Activity Costs $1,344
COUNTRY GENERAL
Activity cost pools Country General
Customer deliveries $1,800
Manual order processing $2,960
Electronic order processing $0
Line item picking $546
Total Activity Costs $5,306
Explanation:
a. Computation for the activity rate for each activity cost pool
Using this formula
Activity rate = Total cost / Total activity
Let plug in the formula
Activity cost pools Total Cost (a) Total activity (b) Activity rate (a/b)
Customer deliveries $630,000/ 7,000 =$90
Manual order processing $444,000/ 6,000 =$74
Electronic order processing $231,000/ 11,000 =$21
Line item picking $955,500/ 490,000=$1.95
Therefore the activity rate for each activity cost pool are:
Customer deliveries $90
Manual order processing $74
Electronic order processing $21
Line item picking $1.95
b. Computation for the total activity costs that would be assigned to City General and County General
Using this formula
Activity cost assigned = Actual activity * Activity rates
Cost drivers by product Overhead cost assigned
CITY GENERAL
Activity cost pools Activity rate (a) City General(b) City General (a*b)
Customer deliveries $90 *10 =$900
Manual order processing $74*0=$0
Electronic order processing $21* 10=$210
Line item picking $1.95*120=$234
Total Activity Costs $1,344
($900+$0+$210+$234)
COUNTRY GENERAL
Activity cost pools Activity rate (a) Country General(b) Country General (a*b)
Customer deliveries $90 *20 =$1,800
Manual order processing $74*40=$2,960
Electronic order processing $21* 0=$0
Line item picking $1.95*280=$546
Total Activity Costs $5,306
($1,800+$2,960+$0+546)
Therefore The the total activity costs that would be assigned to City General and County General
are:
CITY GENERAL
Activity cost pools City General
Customer deliveries $900
Manual order processing $0
Electronic order processing $210
Line item picking $234
Total Activity Costs $1,344
COUNTRY GENERAL
Activity cost pools Country General
Customer deliveries $1,800
Manual order processing $2,960
Electronic order processing $0
Line item picking $546
Total Activity Costs $5,306
Bingham Company manufactures and sells Product J. Results for last year's manufacture and sale of Product J are as follows:
Sales: 10,000 units at $160 each $1,600,000
Less costs:
Variable production costs 960,000
Sales commissions: 15% of sales 240,000
Salaries of line supervisors 195,000
Traceable fixed advertising expense 180,000
Fixed general factory overhead (allocated to
products on the basis of square feet occupied170,000
Total costs 1,745,000
Net loss ($145,000)
Bingham Company anticipates no change in the operating results for Product J in the foreseeable future if the product is produced. Bingham is re-examining all of its products and is trying to decide whether to discontinue the manufacture and sale of Product J. The company's total fixed factory overhead cost would not be affected by this decision.
Assume that discontinuing Product J would result in a $100,000 increase in the contribution margin of other product lines. How many units of Product J would have to be sold next year for the company to be as well off as if it just dropped Product J and enjoyed the increase in contribution margin from other products?
a. 15,500 units.
b. 11,875 units.
c. 16,125 units.
d. 2,500 units.
Answer:
Bingham Company
c. 16,125 units.
Explanation:
a) Data and Calculations:
Sales: 10,000 units at $160 each $1,600,000
Less costs:
Variable production costs 960,000
Sales commissions: 15% of sales 240,000
Salaries of line supervisors 195,000
Traceable fixed advertising expense 180,000
Fixed general factory overhead, allocated to
products on the basis of square feet occupied 170,000
Total costs 1,745,000
Net loss ($145,000)
Variable costs:
Variable production costs $960,000
Sales commissions: 15% of sales 240,000
Total variable costs = $1,200,000
Unit variable cost = $120 ($1,200,000/10,000)
Contribution per unit = $40 ($160 - $120)
Total fixed costs:
Salaries of line supervisors 195,000
Traceable fixed advertising expense 180,000
Fixed general factory overhead, allocated to
products on the basis of square feet occupied 170,000
Total fixed costs = $545,000
Target contribution 100,000
(Traceable fixed cost + Target contribution)/Contribution margin
= $645,000/$40
= 16,125
Carter Corporation's partial income statement after its first year of operations is as follows: Income before income taxes $3,750,000 Income tax expense Current $1,035,000 Deferred 90,000 1,125,000 Net income $2,625,000 Carter uses the straight-line method of depreciation for financial reporting purposes and accelerated depreciation for tax purposes. The amount charged to depreciation expense on its books this year was $2,400,000. No other differences existed between book income and taxable income except for the amount of depreciation. Assuming a 20% tax rate, what amount was deducted for depreciation on the corporation's tax return for the current year
Answer: $2,850,000
Explanation:
The amount was deducted for depreciation on the corporation's tax return for the current year will be calculated as:
Defered income tax = $90,000
Tax rate = 20%
We will calculate the difference between the book income and the taxable income which will be:
= $90000 ÷ 20%
= $90000 × 100/20
= $90000 × 5
= $450000
Therefore, the amount that was deducted for depreciation on the corporation's tax return for the current year will be:
= $2,400,000 + $450,000
= $2,850,000
Two alternatives, code-named X and Y, are under consideration at Guyer Corporation. Costs associated with the alternatives are listed below. Alternative X Alternative Y Materials costs $ 41,000 $ 59,000 Processing costs $ 45,000 $ 45,000 Equipment rental $ 17,000 $ 17,000 Occupancy costs $ 16,000 $ 24,000 Are the materials costs and processing costs relevant in the choice between alternatives X and Y
Answer: Only Material costs are relevant
Explanation:
The material cost under alternative X is given as $41000 while under alternative Y is given as $59000.
The processing cost under alternative X is given as $45000 while under alternative Y, the processing cost is given as $45000 as well.
Then, we can deduce that only the materials costs are relevant since the processing costs are thesame.
Prepare a flexible budget for Cedar Jeans Company using production levels of 16,000, 18,000, and 20,000 units produced. The following is additional information necessary to complete the budget: Variable costs: Direct labor ($6.00 per unit) Direct materials ($8.00 per unit) Variable manufacturing costs ($2.50 per unit) Fixed costs: Supervisor's salaries $80,000 Rent 12,000 Depreciation on equipment 24,000
Answer:
Results are below.
Explanation:
Giving the following information:
Total unitary variable cost= $16.5
Total fixed costs= $116,000
Now, the flexible budget for each production level:
16,000 units:
Total variable cost= 16.5*16,000= 264,000
Total fixed cost= 116,000
Total costs= $380,000
18,000 units:
Total variable cost= 16.5*18,000= 297,000
Total fixed cost= 116,000
Total costs= $413,000
20,000 units:
Total variable cost= 16.5*20,000= 330,000
Total fixed cost= 116,000
Total costs= $446,000
Otto and Monica are married taxpayers who file a joint tax return. For the current tax year, they have AGI of $99,600. They have excess depreciation on real estate of $59,760, which must be added back to AGI to arrive at AMTI. The amount of their mortgage interest expense for the year was $19,920, and they made charitable contributions of $9,960. They have no other itemized deductions. If Otto and Monica's taxable income for the current year is $69,720, determine the amount of their AMTI.
Answer: $129480
Explanation:
Based on the information given, the amount of their AMTI will be calculated as:
AGI = $99600
Add: Excess Depreciation on Real Estate = $59760
Less: Mortgage Interest Expenses = $19920
Less : Charitable Contribution = $9960
AMTI = $129480
Approach Company, which applies overhead to production on the basis of machine hours, reported the following data for the period just ended: Actual units produced: 14,800 Actual fixed overhead incurred: $791,000 Standard fixed overhead rate: $13 per hour Budgeted fixed overhead: $780,000 Planned level of machine-hour activity: 60,000 If Approach estimates four hours to manufacture a completed unit, the company's fixed-overhead volume variance would be: Multiple Choice $10,400 negative. $10,400 positive. $11,000 negative. $11,000 positive. None of the answers is correct.
Answer:
$11,000 unfavorable
Explanation:
Calculation to determine the company's fixed-overhead volume variance would be:
Actual fixed overhead incurred ($791,000)
Less Budgeted fixed overhead ($780,000)
Fixed-overhead volume variance $11,000 unfavorable
Therefore the company's fixed-overhead volume variance would be: $11,000 unfavorable
consumer behaviour of poor class of pakistan
Answer:
The poor class consumer usually buys products of basic necessity in frequency, but in limited and small quantities. It is not common for excessive purchases to be made and for products that are not essential for survival. In addition, this consumer can buy lower quality products that have lower prices, or products on sale or with low price offers. The frequency of shopping is also low and they tend to buy in more popular places for the low-income population.
Explanation:
Consumer behavior is the term used to determine the quantity, the reason, the places and the type of product that the consumer buys. This behavior can be analyzed psychologically, socially, economically and anthropologically.
Regarding poor consumption, it is common for the amount of money to be very limited, causing this consumer to buy only the essential products, even so the quantities are low and the quality is also low because that is what fits in the budget.
Ronnie operates a lawn-care service. On each day, the cost of mowing the first lawn is $15, the cost of mowing the second lawn is $25, and the cost of mowing the third lawn is $40. His producer surplus on the first three lawns of the day is $100. If Ronnie charges all customers the same price for lawn mowing, that price is a. $20. b. $60. c. $80. d. $180.
Answer:
b. $60
Explanation:
Produced surplus = Price producer is able to sell - Price producer would be willing to sell
Price the producer is able to sell = Producer surplus + Price producer would be willing to sell
= $100 + ($15 + $25 + $40)
= $180 for 3 lawn
Therefore, if Ronnie charges are customers the same price for lawn mowing, that price is
= $180 / 3
= $60
The Sanding Department of Quik Furniture Company has the following production and manufacturing cost data for March 2017, the first month of operation. Production: 9,510 units started which is comprised of 6,510 units finished and transferred out and 3,000 units started that are 100% complete as to materials and 20% complete as to conversion costs. Manufacturing costs: Materials $35,948; labor $21,400; overhead $34,840.
Prepare a production cost report. (Round unit costs to 2 decimal places, e.g. 2.25.)
QUIK FURNITURE COMPANY
Sanding Department
Production Cost Report
For the Month Ended March 31, 2017
Equivalent Units Physical Units Conversion Costs Quantities Units to be accounted for Materials Work in process, March 1 Started into production Total units Units accounted for Transferred out Work in process, March 31 Total units
Conversion Costs Total Costs Unit costs Materials Total Costs Equivalent units Unit costs Costs to be accounted for Work in process, March 1 Started into production Total costs Cost Reconciliation Schedule Costs accounted for Transferred out Work in process, March 31 Materials Conversion costs Total costs
Answer:
Quick Furniture Company
The Sanding Department
Production Report
For the month of March 2017:
Materials Conversion Total
Manufacturing costs $35,948 $56,240 $92,188
Cost per equivalent unit:
Manufacturing costs $35,948 $56,240
Equivalent units 9,510 7,110
Cost per equivalent unit $3.78 $7.91
Cost assigned to:
Units transferred out $24,608 $51,494 $76,102
Ending Work in Process $11,340 $4,746 16,086
Total costs assigned $35,948 $56,240 $92,188
Explanation:
a) Data and Calculations:
Materials Conversion
Units started 9,510
Units completed 6,510 6,510 6,510
Ending WIP 3,000 3,000 600
Equivalent units 9,510 7,110
Production Cost Report:
Materials Conversion Total
Manufacturing costs $35,948 $56,240 $92,188
Cost per equivalent unit:
Manufacturing costs $35,948 $56,240
Equivalent units 9,510 7,110
Cost per equivalent unit $3.78 $7.91
Cost assigned to:
Units transferred out $24,608 $51,494 $76,102
($3.78 * 6,510) ($7.91 * 6,510)
Ending Work in Process $11,340 $4,746 16,086
($3.78 * 3,000) ($7.91 * 600)
Total costs assigned $35,948 $56,240 $92,188
Questions answer them
Quark Inc. just began business and made the following four inventory purchases in June: June 1 150 units $ 825 June 10 200 units 1,120 June 15 200 units 1,140 June 28 150 units 885 $3,970 A physical count of merchandise inventory on June 30 reveals that there are 200 units on hand. Using the FIFO inventory method, the amount allocated to ending inventory for June is
Answer:
$1,170
Explanation:
The amount allocated to ending inventory for June using FIFO inventory method is computed as;
= $885 + [($1,140 ÷ 200) × (200 - 150]
= $88 5 + ($5.7 × 50)
= $885 + $285
= $1,170
Convertible securities are bonds or preferred stock that, under specified terms and conditions, can be exchanged for common stock at the option of the holder. Conversion of these securities does not provide new capital; debt (or preferred stock) is simply replaced on the balance sheet by common stock. However, reducing the debt or preferred stock will improve the firm’s financial position and make it easier to raise additional capital, but raising additional capital requires a separate action.
The conversion ratio ( ) is the number of shares of common stock that are obtained by converting a convertible bond or share of convertible preferred stock. The conversion price ( ) is the effective price paid for common stock obtained by converting a convertible security. From the standpoint of the issuer, which of the following statements is a disadvantage of convertibles?
a. Because convertibles have low coupon rates, they require the firm to sell common stock at discount prices relative to prices that are currently prevailing.
b. Convertibles typically have a low coupon interest rate, and the advantage of this low-cost debt will be lost when conversion occurs.
c. If the company truly wants to raise equity capital and if the stock price does not rise sufficiently after the bond is issued, then the company will be stuck with debt rather than the desired equity. ___________ is/are correct.
Answer:
Statement B and Statement C are Correct. And Statement A is not Correct.
Explanation:
Solution:
In this question, statement B and Statement C are correct and Statement A is incorrect. Because:
From the standpoint of the issuer, both Statements B and C are a disadvantages of convertibles. So, statement B and B are correct.
The reason why Statement A is not correct is because convertibles tend to provide an opportunity to the person who is issuer of the convertibles to in order to sell common stock at premium or higher prices with respect to or relative to the prices that are currently prevailing prices.
Hence, Statement A is not correct.
Assume that a $1,000,000 par value, semiannual coupon US Treasury note with three years to maturity has a coupon rate of 3%. The yield to maturity (YTM) of the bond is 11.00%. Using this information and ignoring the other costs involved, calculate the value of the Treasury note:$960,214.55$504,112.64$680,151.97$800,178.79
Answer: $800,178.79
Explanation:
This is a semi-annual coupon bond so convert rate and period to semi annual rates.
Coupon payment = 3% * 1,000,000 * 1/2 years
= $15,000
YTM = 11%/2 = 5.5%
Number of periods = 3 years * 2 = 6 semi annual periods
Value of Bond = Present value of coupon payments + Present value of par
= 15,000 * ( 1 - ( 1 + 5.5%)⁻⁶) / 5.5%) + 1,000,000 / (1 + 5.5%)⁶
= 74,932.9546296555 + 725,245.8330245964
= $800,178.79
Tulane Tires wrote a contract for a $104,000 sale of tires to the new Garden District Tour Company. Tulane only anticipates a slightly greater than 50 percent chance that Garden will be able to pay the amounts that Tulane is entitled to receive under the contract. Upon delivery of the tires, assuming no payment has yet been made by Garden, how much revenue should Tulane recognize under U.S. IFRS
Answer: $0
Explanation:
Under the United States IFRS, we should note that in this case, the contract according to the question will not be able to qualify for revenue recognition since the percentage of it occuring is more than 50% which mean that it is very likely it'll exist.
Therefore, in this case, revenue recognized will be $0.
The sensitivity of a system for disciplining and possibly terminating employees is important, and it is critical that the system be seen as fair. Employees form conclusions about the system's fairness based on the system's outcomes and procedures and the way managers treat employees when carrying out those procedures. Three principles of justice are outcome fairness, procedural justice, and interactional justice.
Outcome fairness involves the ends of a discipline process or action, while procedural and interactional justice focus on the means to those ends. Not only is behavior ethical that is in accord with these principles, but research has also linked the last two categories of justice with employee satisfaction and productivity
Place each of the following labels in one of the columns.
Listen closely
College buddies
Project work
Family friendly
Explanations
Family relations
Accommodations
Gender benefits
Team raises
Promotion
Respect
Qualifications
Outcome fairness Procedural justice International justice
Answer:
You and a friend apply for a job and you believe that you are more qualified - Outcome Fairness
You find out that your friend's uncle is hiring a manager for the company- Procedural justice
Explanation:
Outcome Fairness is the situation where we perceive that the results for a certain situation will be based on fair judgement.
Procedural Justice is a situation where a man believes that there will be pure justice in resource allocation and decision making will be based on judgement.
If a company has goodwill on its books, the goodwill:
Goodwill is an intangible asset (an asset that's non-physical but offers long-term value) that arises when another company acquires a new business. Goodwill refers to the purchase cost, minus the fair market value of the tangible assets, the liabilities, and the intangible assets that you're able to identify.
How does goodwill affect a company?Goodwill has a major impact on value because it reduces the risk that a business' profitability will falter after it changes hands. That goodwill value is simply calculated as the difference between the purchase price of the business and the fair market value of the tangible assets included in the sale.
Learn more about goodwill here: brainly.com/question/25818989
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Jaffa Company prepared its annual financial statements dated December 31 of the current year. The company applies the FIFO inventory costing method; however, the company neglected to apply lower of cost or net realizable value to the ending inventory. The preliminary current year income statement follows:
Sales revenue $294,000
Cost of goods sold
Beginning inventory $34,400
Purchases 198,000
Goods available for sale 232,400
Ending inventory (FIFO cost) 63,364
Cost of goods sold 169,036
Gross profit 124,964
Operating expenses 63,400
Pretax income 61,564
Income tax expense (40%) 24,626
Net income $36,938
Required:
Prepare the income statement to reflect lower of cost or net realizable value valuation of the current year ending inventory.
Complete Question:
The ending inventory includes 15,841 units purchased at $4 each. The current market price is $3.00
Answer:
Jaffa Company
Income Statement, reflecting the lower of cost or net realizable value:
Sales revenue $294,000
Cost of goods sold
Beginning inventory $34,400
Purchases 198,000
Goods available for sale 232,400
Ending inventory (FIFO cost) 47,523
Cost of goods sold 184,877
Gross profit 109,123
Operating expenses 63,400
Pretax income 45,723
Income tax expense (40%) 18,289
Net income $27,434
Explanation:
a) Data and Calculations:
Ending inventory at LCNRV = 15,841 * $3.00 = $47,523
Sales revenue $294,000
Cost of goods sold
Beginning inventory $34,400
Purchases 198,000
Goods available for sale 232,400
Ending inventory (FIFO cost) 63,364
Cost of goods sold 169,036
Gross profit 124,964
Operating expenses 63,400
Pretax income 61,564
Income tax expense (40%) 24,626
Net income $36,938
Prepare a contribution format income statement segmented by divisions. 2-a. The Marketing Department has proposed increasing the West Division's monthly advertising by $22,000 based on the belief that it would increase that division's sales by 13%. Assuming these estimates are accurate, how much would the company's net operating income increase (decrease) if the proposal is implemented
Answer:
hello your question is incomplete attached below is the complete question
1) attached below
2a) $19340
2b) yes
Explanation:
1) Prepare The contribution format income statement
variable cost :
east = 446,000 * 50% = 223,000
west = 600,000 * 47% = 282,000
central = 660,000 * 39% = 257400
attached below is the table ( screenshot from my excel )
2a) Determine how much the net operating income would increase
= ( Increase in contribution margin )- ( Increase in fixed cost )
= $41340 - $22,000 = $19340
where :
Increase in contribution margin = 318,000 * 13% = $41340
Increase in fixed cost = $22,000
2b) I will recommend the increased advertising because the increase in net operating income
Difference between free market and capitalism.
Cost pools should be charged to responsibility centers by using: Multiple Choice budgeted amounts of allocation bases because the behavior of one responsibility center should influence the allocations to other responsibility centers. actual amounts of allocation bases because the behavior of one responsibility center should influence the allocations to other responsibility centers. actual amounts of allocation bases because the behavior of one responsibility center should not influence the allocations to other responsibility centers. some other approach. budgeted amounts of allocation bases because the behavior of one responsibility center should not influence the allocations to other responsibility centers.
Answer:
budgeted amounts of allocation bases because the cost allocation to one responsibility center should not influence the allocations to others.
Explanation:
The budgeted amount of allocation bases would be measured at the starting of the period and the same would be applied or used to charge the cost pool for the responsibility centers
Hence, according to the given situation, the above represent the answer
And, the same should be relevant
ns Corporation's net income last year was $97,400. Changes in the company's balance sheet accounts for the year appear below: Increases (Decreases) Asset and Contra-Asset Accounts: Cash and cash equivalents $ 18,800 Accounts receivable $ 13,800 Inventory $ (17,600 ) Prepaid expenses $ 4,400 Long-term investments $ 10,900 Property, plant, and equipment $ 75,600 Accumulated depreciation $ 32,900 Liability and Equity Accounts: Accounts payable $ (18,700 ) Accrued liabilities $ 17,100 Income taxes payable $ 4,200 Bonds payable $ (64,200 ) Common stock $ 41,600 Retained earnings $ 93,000 The company did not dispose of any property, plant, and equipment, sell any long-term investments, issue any bonds payable, or repurchase any of its own common stock during the year. The company declared and paid a cash dividend of $4,400. Required: a. Prepare the operating activities section of the company's statement of cash flows for the year. (Use the indirect method.) b. Prepare the investing activities section of the company's statement of cash flows for the year. c. Prepare the financing activities section of the company's statement of cash flows for the year.
Answer:
Part a
operating activities section
Increase in Retained earnings $ 93,000
Add Depreciation $ 32,900
Increase in Accounts receivable ($ 13,800)
Decrease in Inventory $ 17,600
Increase in Prepaid expenses ($ 4,400)
Decrease in Accounts payable ($18,700 )
Increase in Income taxes payable $ 4,200
Net Cash Provided by investing activities $110,800
Part b
investing activities section
Purchases of Long-term investments ($ 10,900)
Property, plant, and equipment ($ 75,600)
Net Cash Used by investing activities ($86,500)
Part c
financing activities section
Decrease in Bonds payable ($ 64,200)
Increase in Common stock $ 41,600
Dividends Paid ($4,400)
Net Cash Used by investing activities ($27,000)
Explanation:
Operating Activities shows cash resulting from Company`s trading activities.
Investing Activities shows cash resulting from Purchase and Sell of Investments and non - current assets
Financing Activities shows cash resulting from Acquisition of Funds and the repayments thereoff.
John received a promotion at work and felt new clothes would be necessary in the new position. John went to a local store and charged three ties on his charge account at a cost of $60 each. Bill, a friend of John's, saw a sidewalk vendor selling ties at a cost of three for $10 and bought three at that price. The friends compared purchases that night and found that they had purchased identical ties. John became enraged and said that he would not pay the charge-account bill because the ties were clearly not worth $60 each. Bill indicated that he would testify on John's behalf if litigation ensued. What would be the probable outcome of the lawsuit
Answer:
John will lose the lawsuit
Explanation:
Businesses have a right to set the price of their products, and when the customers considers the price and agrees with it the deal is sealed.
In the given scenario John made the purchase at $60 per tie and he was satisfied with the sale at point of purchase.
He only became enraged when Bill told him he bought his identical ties at $10.
John will lose a lawsuit of he fails to pay the charge-account bill because he willingly agreed to the $60 per tie price.
What is the solution to this problem?
Flintstone Company is owned equally by Fred Stone and his sister Wilma, each of whom hold 2,400 shares in the company. Wilma wants to reduce her ownership in the company, and it was decided that the company will redeem 480 of her shares for $30,700 per share on December 31 of this year. Wilmaâs income tax basis in each share is $7,900. Flintstone has current E&P of $10,930,000 and accumulated E&P of $50,210,000.
a. What is the amount and character (capital gain or dividend) recognized by Wilma as a result of the stock redemption, assuming only the "substantially disproportionate with respect to the shareholder" test is applied?
b. What is Wilmaâs income tax basis in the remaining 1,920 shares she owns in the company?
c. Assuming the company did not make any dividend distributions this year, by what amount does Flintstone reduce its E&P as a result of the redemption?
Answer:
Explanation:
From the given information:
In Flinstone company;
The old ownership = 2400/(2400+200) = 50%
New onwership = 1920/(1920 + 2400) = 44.4%
The reduction in Wilma ownership in Flinstone company is from 50% to 44.4%
Dividend amount perceived by WIlma is:
$30700 × 480 shares = $14,736,000
The responsibility of Wilma in the wake of taking the redemption is in reality more than the 40% (80% x 50%), so she fails the considerably disproportionate test.
Hence, dividend recognition = $1,47,36,000
b)
Wilma's personal income tax expense premise in excess shares can be determined by summing back the unused tax premise of 480 offers reclaimed to the premise of her leftover offers 1920.
unused tax premise of 480 shares = 480 × $7900 = $37,92,000
premises of the remaining shares = 1920 × $7900 = $1,51,68,000
In the remaining shares, WIlma income tax = $37,92,000 + $1,51,68,000
= $1,89,60,000
c)
Flintstone will make the decrease in its E&P by a measure of profit perceived by Wilma =$1,47,36,000
Suppose that the Federal Reserve decides to decrease the money supply with a $300 purchases of Treasury bills. Complete the tables that represent the financial position of the Federal Reserve and commercial banks after this open-market operation. Be sure to use a negative sign for reduced values.
Federal Reserves Assest Liabilities
Commercial Reserves Assets Liabilities
For the Federal Reserve, what are assets? What are liabilities?
a. Monetary base; Reserves
b. Monetary base; Treasury bills
c. Treasury bills; Reserves
d. Reserves; Treasury bill
e. Treasury bills; Monetary base
Answer:
1. Federal Reserves:
Assets : $300
The Fed purchased these T-bills so they will form part of the Fed's assets as they are now owned by the Fed.
Liabilities: $300
Liabilities of the Fed will increase by $300 because the banks will deposit the money they got from the purchase in the Fed.
Commercial Banks:
Treasury Bills: -$300
The Treasury bills will reduce by $300 to reflect that the Fed purchased $300 worth of T-bills from the banks.
Reserves: $300
Reserves will increase because the banks would have made money from selling the T-bills to the Fed.
2. e. Treasury bills; Monetary base
Treasury bills are assets to the Fed in this case because as explained, they own these T-bills now after purchasing them.
The monetary base however, is a liability because it represents commercial bank reserves held in the Fed. They owe the banks this money thereby making it a liability.