Strategic Plan
2016 - 2018
Boutique Build Australia

Answers

Answer 1

2002 Alan cocoa so 20 characters is dodo

Related Questions

Cost of Goods Sold and Income Statement Schuch Company presents you with the following account balances taken from its December 31 adjusted trial balance:

Inventory, January 1 $40,000 Purchases returns $3,500
Selling expenses 35,000 Interest expense 4,000
Purchases 110,000 Sales discounts taken 2,000
Sales 280,000 Gain on sale of property (pretax) 7,000
General and administrative expenses 22,000 Freight-in 5,000

Additional data:
1. A physical count reveals an ending-inventory of $22,500 on December 31.
2. Twenty-five thousand shares of common stock have been outstanding the entire year.
3. The income tax rate is 30% on all items of income.

Required:
a. As a supporting document for Requirements 2 and 3, prepare a separate schedule for Schuch's cost of goods sold.
b. Prepare a 2013 multiple-step income statement.
c. Prepare a 2013 single-step income statement.

Answers

Answer:

Schuch Company

a) Schedule of Cost of Goods Sold

Inventory, January 1 $40,000

Purchases 110,000

Purchases returns -3,500

Freight-in 5,000

Cost of goods available for sale $151,500

less Inventory, December 31 22,500

Cost of goods sold $129,000

b) Multi-step Income Statement

For the year ended December 31, 2013:

Net Sales Revenue $278,000

Cost of Goods Sold 129,000

Gross profit $149,000

Expenses:

Selling expenses 35,000

General & admin exp. 22,000 57,000

Operating profit $92,000

Interest expense 4,000

Income after interest expense $88,000

Gain on sale of property (pretax) 7,000

Comprehensive income before tax $95,000

Income Tax (30%) 28,500

Net income $66,500

EPS = $2.66

c) Single-step Income Statement

For the year ended December 31, 2013:

Net Sales Revenue $278,000

Gain on sale of property (pretax) 7,000

Total revenue and gains $285,000

Cost of Goods Sold 129,000

Selling expenses 35,000

General & admin exp. 22,000

Interest expense 4,000

Total expenses $190,000

Income before taxes $95,000

Income Taxes (30%) 28,500

Net income $66,500

EPS = $2.66

Explanation:

a) Data and Calculations:

December 31 adjusted trial balance:

Inventory, January 1 $40,000

Purchases returns $3,500

Selling expenses 35,000

Interest expense 4,000

Purchases 110,000

Sales discounts taken 2,000

Sales 280,000

Gain on sale of property (pretax) 7,000

General and administrative expenses 22,000

Freight-in 5,000

Additional data:

Ending Inventory $22,500

Common Stock outstanding = 25,000

Income tax rate = 30%

Sales $ 280,000

Sales discounts taken 2,000

Net Sales Revenue $278,000

How is an index fund different than an exchange-traded fund?

Answers

Answer:The key differences between index ETFs and index funds is ETFs trade throughout the day while index funds trade once at market close. ETFs are often cheaper than index funds if bought commission-free. Index funds often have higher minimum investments than ETFs.

Explanation: The key differences between index ETFs and index funds is ETFs trade throughout the day while index funds trade once at market close. ETFs are often cheaper than index funds if bought commission-free. Index funds often have higher minimum investments than ETFs.

The number of people or subordinates that a manager effectively controls and directs is called the manager's span of:

Answers

Answer: Span of Control

Explanation:

A Manager's span of control refers to all the subordinates that report to that manager. The manager therefore effectively controls and directs them and as such is answerable for them.

Spans of Control are different depending on the type of company it is. A manager with a lot of people in their span of control is said to have a Wide span of control and the reverse is a Narrow Span of control.

A very important part of management is determining the largest number of subordinates that can be in a span of control without overwhelming the manager.

Last week, an investigative reporter for a major metropolitan newspaper discovered that the doctors conducting clinical trials of a new cancer treatment drug are also the principal shareholders in Cancer Solutions Inc. (CSI). CSI is the company developing and attempting to market the drug. Upon being interviewed by federal authorities, the doctors acknowledged their conflict of interest but reported that they were sold the shares at a 75% discount by CSI's chief financial officer. The CFO was concerned that CSI might not be able to meet its annual performance objectives and in turn pay his anticipated multimillion-dollar bonus.
Does an agency conflict exist between CSI's CFO and the company's shareholders?
a. Yes; CSI's CFO engaged in unethical conduct to manipulate the firm's short-term earnings and improve the likelihood of receiving his annual bonus.
b. Yes; the shares should not have been sold at a 75% discount, which is price discrimination.
c. No; professionals, such as doctors and professional money managers, would not participate in unethical activities.
d. No; in general, shareholders are satisfied with company officers engaging in any type of legal or illegal activity to ensure the chances of them receiving greater dividend payments.
Which of the following actions will help ease agency conflicts and better align managers' objectives with the firm's shareholder wealth?
a. Pay the manager a combination of salary and stock options (phased in over several years) that reward him or her for consistently increasing shareholder wealth.
b. Pay the manager a large base salary with a huge stock option package that matures on a single date.
Amalgamated Metals Corporation's stockholders are mostly individual investors, and there is relatively little institutional ownership. If several pension and mutual funds were to take large positions in Amalgamated Metals Corporation's stock, direct shareholder intervention would be___________ likely to motivate the firm's management.

Answers

Answer:

FIRST QUESTION

A)Yes; CSI's CFO engaged in unethical conduct to manipulate the firm's short-term earnings and improve the likelihood of receiving his annual bonus.

SECOND QUESTION

A)Pay the manager a combination of salary and stock options (phased in over several years) that reward him or her for consistently increasing shareholder wealth.

LAST QUESTION

MORE likely

Explanation:

We are informed from the question about an investigative reporter for a major metropolitan newspaper discovery about the doctors conducting clinical trials of a new cancer treatment drug are also the principal shareholders in Cancer Solutions Inc. And how The CFO was concerned that CSI might not be able to meet its annual performance objectives and in turn pay his anticipated multimillion-dollar bonus.

In this case there is an agency conflict that exist between CSI's CFO and the company's shareholders, this is because the, CSI's CFO engaged in unethical conduct to manipulate the firm's short-term earnings and improve the likelihood of receiving his annual bonus.

Agency conflict in finance, is also regarded as conflict of interest, usually occur between the management and the shareholders of that company, it is conflict that usually emerge when those that are required for certain responsibility like interest of principal decide to divert the the authority for their own benefits. However,agency conflict can be minimized by allowing transparency and some ways.

It should be noted here that the CSI's CFO engaged in unethical conduct to manipulate the firm's short-term earnings and improve the likelihood of receiving his annual bonus which is the reason behind the conflict because he act on his own interest.

SECOND QUESTION,

Which of the following actions will help ease agency conflicts and better align managers' objectives with the firm's shareholder wealth?

From the explanation of Agency conflict from First question it should be noted that there are some actions that will help to ease agency conflicts and better align managers' objectives with the firm's shareholder wealth such as

Payment of the manager a combination of salary and stock options (phased in over several years) that reward him or her for consistently increasing shareholder wealth.

The payment of the stock options to the manager will allow selling of stock at agreed price as well as date.

LAST QUESTION

Amalgamated Metals Corporation's stockholders are mostly individual investors, and there is relatively little institutional ownership. If several pension and mutual funds were to take large positions in Amalgamated Metals Corporation's stock, direct shareholder intervention would be__MORE__ likely to motivate the firm's management.

The text presents five signs of organizational culture: mission statement, stories & language, physical layout, rules & policies, and rituals. Select an organization where you have worked or are familiar with and identify an example of each sign of organizational culture. How do you think each of these things conveyed the organizational culture to employees and customers/clients.

Answers

Answer:

Face book

mission statement: give people the power to build community and bring the world closer together.

physical layout: How Face book is constructed.

rules & policies: The employees are required to act honestly, lawfully, ethically and in favor of the company they represent.

rituals: Face book looks for innovation and breaking the status quo, and to do so Face book employees are invited to paint, create and decore their offices and public spaces with own made art.

Explanation:

Organizational culture is what we call the mix of core values and actions that make up an organization, it's mostly and widely used for companies but it also applies to schools, governments, non-profits, and any group of people working together towards a goal.

The mission statement is basically what the organization wants to achieve, or its dreamed goal.

Stories and language are the speech that the organization communicates to the audience or anyone interacting with it.

The physical layouts are the colors and buildings, apps, or any way of direct interaction that any person could have with the organization.

Rules and policies are what dictate the behavior of all the employees and people related to the organization.

And rituals are the activities that the organization does in order to reinforce the values and policies they try to live day by day, doing your own painting is one example of these rituals.

Following are several figures reported for Allister and Barone as of December 31, 2015:

Allister Barone
Inventory $50,000 $300,000
Sales 1,000,000 8,00,000
Investment income Not given
Cost of goods sold 500,000 400,000
Operating expenses 230,000 300,000

Allister acquired 90 percent of Barone in January 2020. In allocating the newly acquired subsidiary's fair value at the acquisition date, Allister noted that Barone had developed a customer list worth $66,000 that was unrecorded on its accounting records and had a six-year remaining life. Any remaining excess fair value over Barone's book value was attributed to goodwill. During 2021, Barone sells inventory costing $135,000 to Allister for $190,000. Of this amount, 20 percent remains unsold in Allister's warehouse at year-end.

Determine balances for the following items that would appear on Allister's consolidated financial statements for 2015:

a. Inventory
b. Sales
c. Cost of Goods Sold
d. Operating Expenses
e. Net Income Attributable to Non-controlling Interest

Answers

Answer:

a. $344,500

b. $1,610,000

c. $405,500

d. $530,000

e. $9,550 loss

Explanation:

First, Eliminate the Intragroup transactions as follows :

Elimination Journal for the Intragroup Sale :

Sales (Barone) $190,000 (debit)

Cost of Sales (Allister) $190,000 (credit)

Elimination of unrealized profit in closing inventory :

Cost of Sales (Barone) $5,500 (debit)

Inventory (Allister) $5,500 (credit)

Unrealized Profit in Inventory ($190,000 - $135,000) × 10% = $5,500

Then, Consolidate the Financial Statements taking into account the elimination journals

Note : Consolidation is 100% of Parent + 100% of Subsidiary.

Note : A firm that is exercising control (> 50% Voting Rights) is required to prepare Consolidated Financial Statements - IFRS 3.

Consolidated Income Statement

Sales (1,000,000 + 8,00,000 - $190,000) $1,610,000

Cost of Sales ( $500,000 + 400,000 - $190,000 + $5,500) ($715,500)

Gross Profit $894,500

Less Operating Expenses ($230,000 + $300,000) ($530,000)

Net Income $364,500

Consolidated Financial Statement (Extract)

Inventory ($50,000 + $300,000 - $5,500) $344,500

Subsidiary Profit

Net Income Attributable to Non-controlling Interest

Net Income Attributable to Non-controlling Interest = Net Subsidiary Income × % Non Controlling Interest

Net Subsidiary Income - Barone

Sales (800,000 - 190,000) $610,000

Less Cost of Sales ( 400,000 + 5,500) ($405,500)

Gross Profit $204,500

Less Operating Expenses ($300,000)

Net Income/ (loss) ($95,500)

Therefore,

Net Income Attributable to Non-controlling Interest = ($95,500) × 10%

= $9,550 loss

Blago Wholesale Company began operations on January 1, 2017, and uses the average cost method in costing its inventory. Management is contemplating a change to the FIFO method in 2018 and is interested in determining how such a change will affect net income. Accordingly, the following information has been developed:

2017 2018
Final inventory:
Average cost $150,000 $255,000
FIFO 160,000 270,000

Condensed income statements for Blago Wholesale appear below:

2017 2018
Sales $1,000,000 $1,200,000
Cost of goods sold 600,000 720,000
Gross profit 400,000 480,000
Selling, general, and administrative 250,000 275,000
Net income $150,000 $205,000

Required:
Based on this information, what would 2018 net income be after the change to the FIFO method?

Answers

Answer:

Blago Wholesale Company

New Net income for 2018 = $220,000

Explanation:

Data and Calculations:

Final inventory: 2017 2018

Average cost $150,000 $255,000

FIFO 160,000 270,000

Difference $10,000 $15,000

2017 2018

Sales $1,000,000 $1,200,000

Cost of goods sold 600,000 720,000

Gross profit 400,000 480,000

Selling, general, and

administrative 250,000 275,000

Net income $150,000 $205,000

2018 Net Income after the change to the FIFO method:

Cost of goods sold (weighted average) 720,000

less adjustment for change of method 15,000

Adjusted cost of goods sold 705,000

Income Statement after the change

Sales $1,200,000

Cost of goods sold 705,000

Gross profit 495,000

Selling, general, and

administrative 275,000

Net income $220,000

I WILL GIVE BRAIN

After seviewing the technical skills required to perform tasks in the manufacturing industry, do you think these skills are
more or less important than the interpersonal skills we discussed in previous units?

Answers

You have to add which skills were discussed but usually interpersonal are more important in business than technical skills

Cash flows from operations may not be sufficient for a firm to keep up with growth-related financing needs, or the firm may not be able to always generate enough cash flow to maintain a surplus of cash. Firms prefer to borrow now to fulfill their capital requirements through means of short-term financing or long-term financing. Both methods have their advantages and disadvantages.

The following statement identifies a possible characteristic of short-term financing.

Consider this case:
Short-term loans usually have a lower cost than long-term loans. Identify whether the preceding statement is true or false.

a. This statement is false and a disadvantage of short-term financing.
b. This statement is true and an advantage of short-term financing.

Firms use a variety of short-term financing sources to support working capital. Use the descriptions in the following table to identify the short-term financing source.

Description Short-Term Financing Source
A formal, committed line of credit extended by a bank or other lending institution.
An obligation backed by collateral, often inventories or accounts receivable.

Answers

Answer:

1. Consider this case:

Short-term loans usually have a lower cost than long-term loans. Identify whether the preceding statement is true or false.

a. This statement is false and a disadvantage of short-term financing.

2. Identify the short-term financing source:

An obligation backed by collateral, often inventories or accounts receivable.

Explanation:

Some organizations regularly require short-term financing to ease uneven cash flows. It is also called working capital financing. Its duration is less than 12 months, unlike long-term financing that can last more than two years. Most of this financing is arranged with banks in the form of bank overdraft.

Last month Empire Company had a $35,280 profit on sales of $287,000. Fixed costs are $68,040 a month. By how much would sales be able to decrease for Empire to still break even

Answers

Answer:

sales might decrease by $287,000 - $189,000 = $98,000 and the company will still break even

Explanation:

gross profit = net income + fixed costs = $35,280 + $68,040 = $103,320

COGS = total sales - gross profit = $287,000 - $103,320 = $183,680

contribution margin ratio = $103,320 / $287,000 = 36%

break even point in $ = $68,040 / 36% = $189,000

sales might decrease by $287,000 - $189,000 = $98,000 and the company will still break even

Presented below is information from Headland Computers Incorporated.
July 1 Sold $22,600 of computers to Robertson Company with terms 3/15, n/60. Headland uses the gross method to record cash discounts. Headland estimates allowances of $1,334 will be honored on these sales.
10 Headland received payment from Robertson for the full amount owed from the July transactions.
17 Sold $256,100 in computers and peripherals to The Clark Store with terms of 2/10, n/30.
30 The Clark Store paid Headland for its purchase of July 17.

Answers

Answer:

July 1

Dr Accounts receivable $22,600

Cr Cash $22,600

Dr Sales returns and allowances $1,334

Cr Allowances for Sales returns and allowances $1,334

July 10

Dr Cash $21,922

Dr Sales Discount $678

Cr Accounts Receivable $22,600

July 17

Dr Accounts receivable $256,100

Cr Sales revenue $256,100

July 30

Dr Cash $256,100

Cr Accounts receivable $256,100

Explanation:

Preparation of Journal entry

July 1

Dr Accounts receivable $22,600

Cr Cash $22,600

Dr Sales returns and allowances $1,334

Cr Allowances for Sales returns and allowances $1,334

July 10

Dr Cash $21,922

(97%×$22,600)

Dr Sales Discount $678

(3%×$22,600)

Cr Accounts Receivable $22,600

($21,922+$678)

July 17

Dr Accounts receivable $256,100

Cr Sales revenue $256,100

July 30

Dr Cash $256,100

Cr Accounts receivable $256,100

Mattola Company is giving each of its employees a holiday bonus of $200 on December 13, 20-- (a nonpayday). The company wants each employee's check to be $200. The supplemental tax percent is used.

Nobody has capped for OASDI prior to the bonus check.

a. What will be the gross amount of each bonus if each employee pays a state income tax of 2.8% (besides the other payroll taxes)? You may need to add one penny to the gross so that net bonus exactly equals $200. Round your calculations and final answers to the nearest cent.

b. What would the net amount of each bonus check be if the company did not gross-up the bonus? Round your intermediary calculations to the nearest cent.

Answers

Answer:

a. Gross amount of each bonus = $309.84

b. Net amount of each bonus = $129.10

Explanation:

Since the supplemental tax percent is used, the following are the relevant tax rates to be applied in the calculations:

STP = Supplemental tax percent = 25%

FICASO = Federal Insurance Contributions Act (FICA) social security tax = 6.2%

FICAM = Federal Insurance Contributions Act (FICA) Medicare tax = 1.45%.

SIT = State income tax = 2.8%

We therefore proceed as follows:

a. What will be the gross amount of each bonus if each employee pays a state income tax of 2.8% (besides the other payroll taxes)? You may need to add one penny to the gross so that net bonus exactly equals $200. Round your calculations and final answers to the nearest cent.

Given the tax rates above, the following formula is used to calculate the gross amount of each bonus:

Gross amount of each bonus = Holiday bonus amount / (100% - STP - FICASO - FICAM - SIT) …… (1)

Substituting the relevant values into equation (1), we have:

Gross amount of each bonus = $200/ (100% - 25% - 6.20% - 1.45% - 2.8%)

Gross amount of each bonus = $200 / 64.55%

Gross amount of each bonus = $309.837335398916

To the nearest cent which implies to two decimal places, we have:

Gross amount of each bonus = $309.84

b. What would the net amount of each bonus check be if the company did not gross-up the bonus? Round your intermediary calculations to the nearest cent.

The net amount of each bonus can be calculated using the following formula:

Net amount of each bonus = Holiday bonus amount * (100% - STP - FICASO - FICAM - SIT) …… (2)

Substituting the relevant values into equation (2), we have:

Net amount of each bonus = $200 * (100% - 25% - 6.20% - 1.45% - 2.8%)

Net amount of each bonus = $200 * 64.55%

Net amount of each bonus = $129.10

In 2009, an 1893 Morgan silver dollar sold for $6,450. Required: What was the rate of return on this investment? (Do not include the percent sign (%). Enter rounded answer as directed, but do not use the rounded numbers in intermediate calculations. Round your answer to 2 decimal places (e.g., 32.16).)

Answers

Answer: 7.86%

Explanation:

Using the Future Value formula;

= Amount * ( 1 + r)^n

The question is looking for the rate so making that the subject would be;

Assuming the car was $1 in 1893,

And n = 2009 - 1893 = 116 years

FV = Amount * ( 1 + r)^n

( 1 + r)^n = FV/ Amount

1 ^n + r^n = FV / Amount

r = n√((FV/ Amount) / 1^n)

r = n√(FV/ Amount)

r = 116√(6,450/ 1)

= 1.07855

Subtract 1 for the percentage;

= 1.07855 - 1

= 7.86%

g after examining the various personal loan rates available to you, you find that you can borrow funds from a finance company at an APR of percent compounded or from a bank at an APR of percent compounded . Which alternative is more attractive? a. If you borrow $ from a finance company at an APR of percent compounded for year, how much do you need to payoff the loan?

Answers

question text WITH missing information:

After examining the various personal loan rates available to you, you find that you can borrow funds from a finance company at an APR of 12 percent compounded monthly or from a bank at an APR of 13 percent compounded annually. Which alternative is more attractive?

If you borrow $100 from a finance company at an APR of 9% percent compounded for year, how much do you need to payoff the loan?

Answer:

The finance company option is better as we are taking the loan we want the lower rate possible.

We need $109 to payoff the loan of $100 at 9% annualy after a whole year.

Explanation:

We solve for the effective rate of 12% compounded monthly

[tex](1+\frac{0.12}{12} )^{12}[/tex] = 1.12682503 = 0.126825 = 12.6825%

As this rate is lower than 13% this option is better

If we take 100 dollars after a year we have to pay:

$100 x (1 + r) = 100 x (1 + 0.09) = 100 x 1.09 = $109

Presented below are certain account balances of Oriole Products Co.

Rent revenue $6,520 Sales discounts $8,240
Interest expense 13,460 Selling expenses 99,440
Beginning retained earnings 114,900 Sales revenue 407,700
Ending retained earnings 134,130 Income tax expense 25,015
Dividend revenue 71,910 Cost of goods sold 188,927
Sales returns and allowances 12,910 Administrative expenses 75,820
Allocation to noncontrolling interest 20,040

From the foregoing, compute the following:
a.Total net revenue:_________
b. Net income:__________
c. Income attributable to controlling stockholders:___________

Answers

Answer:

a. Sales revenue 407700

Sales discounts 8240

Sales returns and allowances 12910 (21150)

Net sales 386,550

Rent revenue 6520

Dividend revenue 71910

Total net revenue $464980

b. Total net revenue $464980

Less: Expenses

Cost of goods sold 188927

Selling expenses 99440

Administrative expenses 75820

Interest expense 13460

Income tax expense 25015 $402662

Net income $62318

Less: Allocation to noncontrolling interest $20040

Income attributable to controlling $42278

stockholders

Select the qualitative characteristics for the following statements.

a. Quality of information that permits users to identify similarities in and differences between two sets of economic phenomena. select a qualitative characteristic.
b. Having information available to users before it loses its capacity to influence decisions.
c. Information about an economic phenomenon that has value as an input to the processes used by capital providers to form their own expectations about the future.
d. Information that is capable of making a difference in the decisions of users in their capacity as capital providers.
e. Absence of bias intended to attain a predetermined result or to induce a particular behavior.

Answers

Answer:

Options includes the followings: Relevance, Faithful representation, Predictive value, Confirmatory value, Comparability, Completeness, Neutrality, Timeliness.

a. Quality of information that permits users to identify similarities in and differences between two sets of economic phenomena. select a qualitative characteristic.

Qualitative characteristics: Comparability

b. Having information available to users before it loses its capacity to influence decisions.

Qualitative characteristics: Timeliness

c. Information about an economic phenomenon that has value as an input to the processes used by capital providers to form their own expectations about the future.

Qualitative characteristics: Predictive Value

d. Information that is capable of making a difference in the decisions of users in their capacity as capital providers.

Qualitative characteristics: Relevance

e. Absence of bias intended to attain a predetermined result or to induce a particular behavior.

Qualitative characteristics: Neutrality

How much would the Gerrards have to put down if the lender required a minimum 20 percent down payment

Answers

Answer:

the first part of the question is missing, so I looked for similar questions to fill in the blanks:

Ben and Marie Gerrard, both in their mid-20s, have been married for 4 years and have two preschool-age children. Ben has an accounting degree and is employed as a cost accountant at an annual salary of $63,000. They're now renting a duplex but wish to buy a home in the suburbs of their rapidly developing city. They've decided they can afford a $210,000 house and hope to find one with the features they desire in a good neighborhood.

If the Gerrards are required to make a minimum 20% down payment, then they need to pay at least $210,000 x 20% = $42,000.

Many lenders require a minimum down payment for a mortgage loan and others charge different interest rates depending on the down payment percentage, e.g. if your down payment represents 30% of the house's value, the interest rate will be lower than a loan with a 20% down payment. The logic behind this is that the higher the down payment, the safer the loan.

Your client, Bob, is the CEO of a corporation that has 12 stockholders who are also the only employees of the business. The corporation operates a boat dealership in Sherman, Texas. The corporation has accumulated earnings and profits of $3,000,000, not including the current year’s taxable income, which is expected to be $800,000. No dividends have been paid to stockholders. Bob has been very pleased with the corporation’s performance and he wants to reward the stockholders.
1. Why should Bob declare a cash dividend over giving stockholders a bonus?2. Why should Bob not consider paying a larger year-end bonus to his employee/stockholders’

Answers

Answer:

1. Why should Bob declare a cash dividend over giving stockholders a bonus?

Bob should not declare a cash dividend, instead he should give the employees/stockholders a bonus. A corporation distributes dividends with their after tax income, while bonuses actually decrease net income and lowers taxes. it is always better to pay less taxes.

2. Why should Bob not consider paying a larger year-end bonus to his employee/stockholders’.

In this case, if you have to choose between declaring a dividend or paying a bonus, Bob should definitely pay a bonus. But the bonus should not be larger than the corporation's expected income. It is not a good idea to incur in an operating loss due to huge bonuses.

Cooperative San José of southern Sonora state in Mexico makes a unique syrup using cane sugar and local herbs. The syrup is sold in small bottles and is prized as a flavoring for drinks and for use in desserts. The bottles are sold for $12 each. The first stage in the production process is carried out in the Mixing Department, which removes foreign matter from the raw materials and mixes them in the proper proportions in large vats. The company uses the weighted-average method in its process costing system.

A hastily prepared report for the Mixing Department for April appears below:

Units to be accounted for:
Work in process, April 1 (materials 90% complete; conversion 80% complete) 5,700
Started into production 34,100
Total units to be accounted for 39,800
Units accounted for as follows:
Transferred to next department 29,400
Work in process, April 30 (materials 70% complete; conversion 50% complete) 10,400
Total units accounted for 39,800

Cost Reconciliation Cost to be accounted for:

Work in process, April 1 $15,276
Cost added during the month 96,248
Total cost to be accounted for $111,524
Cost accounted for as follows:
Work in process, April 30 $20,384
Transferred to next department 91,140
Total cost accounted for $111,524

Required:

a. What were the Mixing Department's equivalent units of production for materials and conversion for April?
b. What were the Mixing Department's cost per equivalent unit for materials and conversion for April? The beginning inventory consisted of the following costs: materials, $10,545; and conversion cost, $4,731. The costs added during the month consisted of: materials, $64,649; and conversion cost, $31,599.
c. How many of the units transferred out of the Mixing Department in April were started and completed during that month?
d. The manager of the Mixing Department stated, "Materials prices jumped from about $1.65 per unit in March to $2.15 per unit in April, but due to good cost control I was able to hold our materials cost to less than $2.15 per unit for the month." Should this manager be rewarded for good cost control?

Answers

Answer:

a. EU:

materials = 29,400 + 7,280 = 36,680

conversion = 29,400 + 5,200 = 34,600

b. cost per EU:

materials = $75,194 / 36,680 = $2.05

conversion = $36,330 / 34,600 = $1.05

c. units started and completed during April = 23,700

d. no, he didn't do anything, When a company uses the weighted average process costing method, the cost of beginning WIP is used to determine the cost per equivalent unit. On the other hand, FIFO process costing method doesn't, it only considers costs incurred during the month to calculate cost per equivalent unit.

Explanation:

beginning WIP 5,700 $15,276

materials, $10,545

conversion cost, $4,731

units started 34,100

costs added during the month = $96,248

materials, $64,649

conversion cost, $31,599

units transferred out 29,400 $91,140

ending WIP 10,400 $20,384

materials 70% = 7,280 EU

conversion 50% = 5,200 EU

EU:

materials = 29,400 + 7,280 = 36,680

conversion = 29,400 + 5,200 = 34,600

total cost for materials = $64,649 + $10,545 = $75,194

total cost for conversion = $31,599 + $4,731 = $36,330

cost per EU:

materials = $75,194 / 36,680 = $2.05

conversion = $36,330 / 34,600 = $1.05

units started and completed during April = 29,400 - 5,700 = 23,700

Banana Computer Company sells Banana Computers both in the domestic and foreign markets. Because of the differences in the power supplies, a Banana computer purchased in one market cannot be used in the other market. This means that the company can use third degree price discrimination in order to maximize profits. Let’s suppose that it costs $1,000 to produce each computer (this is marginal and average cost). Let’s suppose further that the domestic and foreign demand curves are given as follows (the subscript "F" denotes "foreign" while the subscript "D" is used to denote "domestic"):

PD=13,000 -20QD
PF= 17,000-40QF

Required:
a. What prices maximize profits for this firm? How many computers do they sell in each market? How much profit does the company earn?
b. Now, suppose that somebody figured out a wiring trick that allows a Banana computer built for either market to be costlessly converted so that it works in the other market. This destroys the company's ability to practice third degree price discrimination and forces them to charge the same price in both markets. What price maximizes the company's profits now? How many computers will they sell in each location? How much profit does the company earn?

Answers

Answer:

with price discrimination

Domestic Price 7,000 Quantity 300

Profit (7,000 - 1,000) * 300 = 1,800,000

Foreing Price 9,000 Quantity 200

Profit (9,000 - 1,000) * 200 = 1,600,000

Total 1,600,000 + 1,800,000 = 3,400,000

no price discrimination:

Price 7,667 Quantity 500

Profit (7,667 - 1,000) x 500 = 3,333,500

Explanation:

Sales Revenue (Domestic)

[tex]R = P \times Q_d = (13,000 - 20Q_d) \times Q_d = -20Q_d^2 + 13,000Q_d\\R' = \frac{dR_{(q)}}{dq} = 13,000 - 40Q_d[/tex]

We now equalice against Marginal Cost:

13,000 - 40Qd = 1,000

Qd = 12,000/40 = 300

Price: 13,000 - 20(300) = 7,000

We do the same process with Foreing demand:

(17,000 - 40Qf) x Qf = -40Qf^2 + 17,000Qf

R' = -80Qf + 17,000

-80Qf + 17,000 = 1,000

Qf = 16,000/80 = 200

Pf = 17,000 - 40(200) = 9,000

If the company cannot do price discrimination then:

We solve for the inverse of both market:

PD=13,000 -20QD

QD = 650 - PD/20

we take the price restrictions:

PD < 13,000

PF= 17,000-40QF

QF = (17,000 - PF)/40 = 425

QF = 425 - PF/40

PF < 17,000

Now, we aggregate the demands:

(650 -P/20 ) + (425 -P/40) =

Q= 1,075 - 0.075P

Make the inverse

P = (1,075 - Q ) / 0.075 = 14.333,33 -13.33Q

And solve for the Quantiy and Price that maximize profit

R = (14.333,33 -13.33Q) x Q = -13.33Q^2 + 14,333.33Q

R' = R(q)/dq = -26.66Q + 14,333.33

-26.66Q + 14,333.33 = 1,000

Q = 500

P = 14,333.33 - 13.33(500) = 7,667

when the business cycle or economic activity is declining the economy is said to be what

Answers

Answer:

Contraction

Explanation:

Contraction is when the level of economic activities in a country goes down. There is decreased productivity in the country, as indicated by a decline in the GDP value. At contraction, the economy will experience a drop in real incomes, retail sales, and industrial production. The unemployment rate begins to rise steadily as companies stop hiring while other lay-off workers due to reduced demand.

Sara’s Salsa Company produces its condiments Process Activity Department 1 Mixing Cooking Department 2 Machine calibration Labeling Defects Support Recipe formulation Additional production information about its Units produced 20,000 cases Batches 200 batches Machine hours 500 MH Focus groups 30 groups Container types 5 containers Production runs 200 runs Required:
Using ABC, compute the total cost per case for in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and the company’s production support activities follow.

Overhead cost Driver Quantity
$4,500 Machine hours 1,500
11,250 Machine hours 1,500
Product testing 112,500 Batches 600
$128,250

$250,000 Production runs 400
12,000 Cases of output 120,000
6,000 Cases of output 120,000
$268,000

$90,000 Focus groups 45
Heat, lights, and water 27,000 Machine hours 1,500
Materials handling 65,000 Container types 8
$182,000

two product lines follows.

Extra Fine Family Style
100,000 cases
400 batches
1,000 MH
15 groups
3 containers
200 runs

each product type if the direct labor and direct materials cost is $6 per case of Extra Fine and $5 per case of Family Style.

Answers

Answer:

Extra Fine= $26

Family Style= $12.98

Explanation:

First, we need to calculate the activities rate for each department and support:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Department 1:

Mixing= 4,500/1,500= $3 per machine hour

Cooking= 11,250/1,500= $7.5 per machine hour

Product testing= 112,500/600= $187.5 per batch

Department 2:

Machine calibration= 250,000/400= $625 per production run

Labeling= 12,000/120,000= $0.1 per cases of output

Defects= 6,000/120,000= $0.05 per cases of output

Support:

Recipe formulation= 90,000/45= $2,000 per focus group

Heat, lights, and water= 27,000/1,500= $18 per machine hour

Materials handling= 65,000/8= $8,125 per container types

Now, we can allocate overhead to each product:

Extra Fine:

Department 1:

Mixing= 3*500= $1,500

Cooking= 7.5*500= $3,750

Product testing= 187.5*200= $37,500

Department 2:

Machine calibration= 625*200= 125,000

Labeling= 0.1*20,000= 2,000

Defects= 0.05*20,000= 1,000

Support:

Recipe formulation= 2,000*30= 60,000

Heat, lights, and water= 18*500= 9,000

Materials handling= 8,125*5= 40,625

Total allocated overhead= $280,375

Unitary cost= 280,375/20,000= $14

Family Style:

Department 1:

Mixing= 3*1,000= $3,000

Cooking= 7.5*1,000= $7,500

Product testing= 187.5*400= $75,000

Department 2:

Machine calibration= 625*200= 125,000

Labeling= 0.1*100,000= 10,000

Defects= 0.05*20,000= 5,000

Support:

Recipe formulation= 2,000*15= 30,000

Heat, lights, and water= 18*1,000= 18,000

Materials handling= 8,125*3= 24,375

Total allocated overhead= $297,875

Unitary cost= 297,875/100,000= $2.98

Finally, the total unitary cost:

Extra Fine= 6 + 6 + 14= $26

Family Style= 5 + 5 + 2.98= $12.98

Marketing by the Numbers: Pricey Sheets
Many luxury sheets cost less than $200 to make but sell for more than $500 in retail stores. Some cost even more consumers pay almost $3,000 for Frett'e "Tangeri Pizzo king-size luxury linens. The creators of a new brand of luxury linens, called Boll & Branch, have entered this market and are determining the price at which to sell their sheets directly to consumers online. They want to price their sheets lower than most brands but still want to earn an adequate margin on sales. The sheets come in a luxurious box that can be reused to store lingerie, jewelry, or other keepsakes. The Boll & Branch brand touts fair trade practices when sourcing its high-grade long staple organic cotton from India. Given the cost information below, refer to Appendix 2: Marketing by the Numbers to answer the following questions.
Cost/King-size Set
Raw Cotton $28.00
Spinning/Weaving/Dyeing $12,00
Cut/Sew/Finishing $10,00
Material Transportation $3,00
Factory Fee $16,00
Inspection and Import Fees $14,00
Ocean Freight/Insurance $5,00
Warehousing $8,00
Packaging $15,00
Promotion $30,00
Customer Shipping $15,00
10-13 Given the cost per king-size sheet set above, and assuming the manufacturer has total fixed costs of $500,000 and estimates first year sales will be 50,000 sets, determine the price to consumers if the company desires a 40 percent margin on sales.
10-14 If the company decides to sell through retailers instead of directly to consumers online, to maintain the consumer price you calculated in the previous question, at what price must it sell the product to a wholesaler who then sells it to retailers? Assume wholesalers desire a 10 percent margin and retailers get a 20 percent margin, both based on their respective selling prices.

Answers

Answer:

10-13 : $277

10-14 : $199.40

Explanation:

10-13

therefore Cost per king-size sheet set will be

$28 + $12 + $10 + $3 + $16 + $14 + $5 + $8 + $15 + $30 + $15 = $ 156

First year sales = 50,000 sets

Total cost = $500,000

Average fixed cost = $500,000/50,000 = $10

Total Cost per king-size sheet set = ( cost per king-size sheet )$156 + (Average fixed cost ) $10 = $166

Desired margin on sales = 40%

Let us consider the sale price to be $100x

since the margin is 40% of the sales this means margin = (40/100)*100x = 40x

So, cost price should be= $(100 – 40) = $60x

Also, Cost price = $166

which means : $166 = 60x

hence x = 166 / 60 = 2.77

therefore the sale price = ( 100 * 2.77 ) = $277

10 - 14

The Retailer sells to customers at a price of $277 after buying from the wholesaler

The retailer gets the margin of 20%, therefore the margin of retailer will be = (20/100)*277 = $55.4

Therefore the price at which retailer will buy the sheet set from the wholesaler will be = $277 ( original price ) - ( 20% of $277) $55.4 = $221.60

While the Wholesaler sells the sheet set to the retailer for $221.60 and gets the margin of 10%

hence the margin of the wholesaler = 10%*221.60 = $22.16

Then the wholesaler will get the sheet set at

= $221.6 – $22.16 = $199.40

This the price at which the company will now sell the sheets to the wholesaler

The stockholders’ equity accounts of Castle Corporation on January 1, 2020, were as follows.
Preferred Stock (8%, $50 par, 10,000 shares authorized) $400,000
Common Stock ($1 stated value, 2,000,000 shares authorized) 1,000,000
Paid-in Capital in Excess of Par—Preferred Stock 100,000
Paid-in Capital in Excess of Stated Value—Common Stock 1,450,000
Retained Earnings 1,816,000
Treasury Stock (10,000 common shares) 50,000
During 2020, the corporation had the following transactions and events pertaining to its stockholders’ equity.
Feb. 1 Issued 25,000 shares of common stock for $120,000.
Apr. 14 Sold 6,000 shares of treasury stock—common for $33,000.
Sept. 3 Issued 5,000 shares of common stock for a patent valued at $35,000.
Nov. 10 Purchased 1,000 shares of common stock for the treasury at a cost of $6,000.
Dec. 31 Determined that net income for the year was $452,000.
Instructions:
A) Journalize the transactions and the closing entry for net income.
B) Enter the beginning balances in the accounts, and post the journal entries to the stockholders’ equity accounts. (Use J5 for the posting reference.)
C) Prepare a stockholders’ equity section at December 31, 2017.

Answers

Answer:

Castle Corporation

A) Journal Entries:

Feb. 1:

Debit Cash Account $120,000

Credit Common Stock $25,000

Credit Paid-in Capital in Excess of Stated Value—Common Stock $95,000

To record the issue of 25,000 common stock shares for $120,000

Apr. 14:

Debit Cash Account $33,000

Credit Treasury Stock $33,000

To record the reissue of 6,000 shares of treasury stock- common for $33,000.

Sept. 3:

Debit Patent $35,000

Credit Common Stock $5,000

Credit Paid-in Capital in Excess of Stated Value—Common Stock $30,000

To record the issue of common stock shares for a patent valued at $35,000

Nov. 10:

Debit Treasury Stock $6,000

Credit Cash $6,000

To record the purchase of treasury stock for $6,000

Dec. 31:

Debit Net Income (Income Statement) $452,000

Credit Retained Earnings $452,000

To close the net income on the income statement to the Statement of retained earnings.

B) Stockholders' Equity Accounts:

Preferred Stock (8%, $50 par, 10,000 shares authorized)