Answer:
The correct answer is A.
Explanation:
Giving the following information:
April $121,800 282,100
May 82,500 163,400
June 99,900 235,900
To calculate the variable and fixed costs under the high-low method, we need to use the following formulas:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (121,800 - 82,500) / (282,100 - 163,400)
Variable cost per unit= $0.33
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 121,800 - (0.33*282,100)
Fixed costs= $28,707
Income statement format; single step and multiple step [LO4-1, 4-3, 4-5] The following is a partial trial balance for General Lighting Corporation as of December 31, 2021: Account Title Debits Credits Sales revenue 3,350,000 Interest revenue 100,000 Loss on sale of investments 32,500 Cost of goods sold 1,390,000 Loss on inventory write-down (obsolescence) 400,000 Selling expense 500,000 General and administrative expense 250,000 Interest expense 99,000 There were 300,000 shares of common stock outstanding throughout 2021. Income tax expense has not yet been recorded. The income tax rate is 25%.Required Prepare a single-step income statement for 2018, including EPS disclosures
Answer:
Net income = $583,875
Earning Per Share (EPS) = $1.95 per share.
Explanation:
A single step income statement can be described as a financial statement that do not break revenues and expenses into there respective different categories, but only use one column each for revenue and expenses.
For this question, a single-step income statement for 2021 can be prepared as follows:
Note: Year 2021 is used as the correct year since it is metioned twice in the question against 2018 that was erroneously mentioned once.
General Lighting Corporation
Income Statement for December 31, 2021
Details $
Revenues:
Sales revenue 3,350,000
Interest revenue 100,000
Total revenue (A) 3,450,000
Expenses:
Cost of goods sold 1,390,000
Selling expense 500,000
General and administrative expense 250,000
Interest expense 99,000
Loss on sale of investments 32,500
Loss on inventory write-down (obsol.) 400,000
Total expenses (B) 2,671,500
Income before tax (A - B) 778,500
Tax (25% * $778,500) (194,625)
Net income 583,875
EPS (583,875 / 300,000) 1.95
In Ricci v. DeStefano, Ricci, a white firefighter, took and passed the City of New Haven firefighter's test, required of all applicants for promotion in the city's fire department. The test was thrown out when it was discovered that minorities scored poorly and the city feared a disparate impact-based lawsuit. How did the court rule?
A) An employer may not simply disregard a test based on unwanted results unless the test is shown to be biased or deficient.
B) Even though the test was prepared by a professional testing organization, the city has the right to reject the test results if minorities do not score adequately
C) Deliberately oversampling minorities to seek to create a fair test is irrelevant if the test results show that minorities still scored poorly
D) Ricci, as a member of the white majority, had no grounds to sue when the city was seeking the legitimate aim of nondiscrimination
Answer:
The correct answer is A. In Ricci v. DeStefano, the Supreme Court ruled that an employer may not simply disregard a test based on unwanted results unless the test is shown to be biased or deficient.
Explanation:
Ricci v. DeStefano is a Supreme Court ruling of 2009, after a lawsuit by nineteen firefighters who claimed to have been discriminated against in terms of career development. They denounced that they had been discriminated after having passed the admission tests and still had not been promoted, since no African-American candidate had passed the tests. They also denounced that they had not been promoted because the Fire Department did not want to promote a group of new recruits without including within it any member of racial minorities.
Finally, the Supreme Court established that said procedure violated Title VII of the Civil Rights Act of 1964, since in the case equal access to employment was not guaranteed (in this case, favoring minorities over white firefighters), for set different demands for purely racial reasons.
The assets and liabilities of Thompson Computer Services at March 31, the end of the current year, and its revenue and expenses for the year are listed below. The capital of the owner was $190,000 at April 1, the beginning of the current year. Mr. Thompson invested an additional $25,000 in the business during the year. Accounts payable $1,200 Miscellaneous expense $370 Accounts receivable 12,340 Office expense 560 Cash 32,990 Supplies 1,670 Fees earned 68,980 Wages expense 25,580 Land 65,000 Drawing 3,000 Building 143,670 Prepare an income statement for the current year ended March 31. Thompson Computer Services Income Statement For the Year Ended March 31
Answer:
Thompson Computer Services
Income statement for the current year ended March 31.
Particulars Amount
Fees Earned $68,980
Expenses
Miscellaneous expense $370
Office expense $560
Wages expense $25,580
Total Expenses $26,510
NET INCOME $42.470
Hubert: Demand decreased, but it was perfectly inelastic. Kate: Demand decreased, but supply was perfectly inelastic. Manuel: Demand decreased, but supply increased at the same time. Poornima: Supply increased, but demand was perfectly inelastic. Shen: Supply increased, but demand was unit elastic. Who could possibly be right
The complete part of the question.
The price of coffee fell sharply last month, while the quantity sold remained the same. Five people suggest various explanations
Answer:
Kate, Manuel and Poornima
Explanation:
Given that, the price of coffee fell but the quantity sold remained the same.
1. Hubert: Demand decreased, but it was perfectly inelastic.
If an elastic demand shifts the demand curve will move to the left. This would cause both prices as well as quantity to decline. So HUBERT's statement is not correct.
2. Kate: Demand decreased, but supply was perfectly inelastic.
This can be true, because of the inelastic supply curve. If the supply curve is an inelastic vertical line then a fall in demand will not affect quantity while the price will fall. So, KATE's statement can be right.
3. Manuel: Demand decreased, but supply increased at the same time.
If there is a decrease in the demand curve, it will shift to the left. Now, if there is an increase in the supply by the same amount the price will fall but quantity will remain the same. So, MANUEL's statement is right.
4. Poornima: Supply increased, but demand was perfectly inelastic.
Here, the rightward shift in the supply curve will cause the price to fall but quantity will remain the same. So, POORNIMA's statement is right.
5. Shen: Supply increased, but demand was unit elastic.
if the demand curve is unitary elastic, an increase in supply will cause the price to fall and quantity to increase. So, SHEN's statement is not correct.
Gall Manufacturing sells a product for $50 per unit. The fixed costs are $840,000, and the variable costs are 60 percent of the selling price. As a result of new automated equipment, it is anticipated that fixed costs will increase by $200,000 and variable costs will be 50 percent of the selling price. The new break-even point in units is
Answer:
41,600 units
Explanation:
The computation of the break even point in unit is shown below:
As we know that
Break Even Point:
= Fixed Cost ÷ Contribution margin per unit
where,
Fixed Cost = $840,000 + $200,000
= $1,040,000
And,
Variable cost per unit is
= 50% 0f selling price
= $50 × 50%
= $25
So, the break even point in units is
= $1,040,000 ÷ $25
= 41,600 units
Zara, an HR manager at Fluxin LLC, is responsible for implementing a guided self-appraisal system using management by objectives in her organization. She has developed specific standards for performance. Which of the following is typically the next step for Zara?
a. Continuing performance discussions
b. Implementation of the performance standards
c. Setting of objectives
d. Job review and agreement
Answer:
The answer is option (c) Setting of objectives.
Explanation:
Solution
The next step for Zara to take from the given question is in the setting of objectives.
Setting of objectives : This is defined as a set of activity of setting objectives or goals for an organization.
In afterwords they are ends that explains specifically how the goals can be achieved or accomplished so they are quantitative in nature.
Use the following information.
Windswept, Inc.
2010 Income Statement
($ in millions)
Net sales $9,570
Cost of goods sold 7,890
Depreciation 465 Earnings before interest and taxes $1,215
Interest paid 110
Taxable Income $1,105
Taxes 387
Net income $718
Windswept, Inc.
2009 and 2010 Balance Sheets
($ in millions)
2009 2010 2009 2010
Cash $250 $280 Accounts payable $1,470 $1,685
Accounts rec. 1,040 940 Long-term debt 1,140 1,320
Inventory 1,880 1,715 Common stock $3,420 $3,040
Total $3,170 $2,935 Retained earnings 630 880
Net fixed assets 3,490 3,990
Total assets $6,660 $6,925 Total liab. equity $6,660 $6,925
What is the days' sales in receivables for 2017?
a. 62.62 days
b. 31.81 days
c. 31.37 days
d. 45.01 day's
e. 33.85 days
Answer:
35.85 days
Explanation:
I suppose the question reads "What is the days' sales in receivables for 2010?"
To find the days' sales in receivables for 2010, use the following:
Days Sales in Receivales for 2010 = (Accounts Receivable in 2010 / Annual Sales) * 365
Where accounts receivable in 2010 from the information given is 940.
Annual sales = $9,570
Therefore,
Days Sales in Receivales for 2010 = [tex] (\frac{940}{9570}) * 365 [/tex]
= 35.85 days
The days' sales in receivables for 2010 is 35.85 days
Which of the following is a community lifeline
Answer:
Safety and security
food, water, and shelter
health and medical
power and fuel
communications and transport
Explanation:
A lifeline allows business and government structures to continue to operate and is beneficial to human health and financial stability. Lifelines are perhaps the most important resources in the community that allow all other facets of society to work when balanced. The interconnected network of resources, services, and securities ( food, water, and shelter, medical care, communications facilities, etc) that provide lifeline services is used on a daily basis to facilitate the community's regularly occurring needs and give all other elements of society to perform efficiently.
Communications are the Community's lifeline. Safety and security, health and medical care, communications, hazardous materials, food, water, shelter, energy (power & fuel), and transportation are the seven community lifelines that FEMA has defined. Thus, option C is correct.
The Community Lifelines idea from the Federal Emergency Management Agency (FEMA) is a framework for event management that gives emergency managers a reporting system to swiftly stabilize a community after a disaster.
Safety and security, health and medical care, communications, hazardous materials, food, water, shelter, energy (power & fuel), and transportation are the seven community lifelines that FEMA has defined. It is a sign that lives are in danger, and daily routines and food chains are disturbed, if any of these Lifelines go down due to a disaster or emergency.
Learn more about FEMA community lifelines here:
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Your question seems to be incomplete, but most probably the complete question was:
Which of the following is a community lifeline?
a. schools and churches
b. lumber and hardware
c. grocery and fast food
d. communications
Robin Company wants to earn a 6% return on sales after taxes. The company’s effective income tax rate is 40%, and its contribution margin is 30%. If Robin has fixed costs of $240,000, the amount of sales required to earn the desired return is
Answer:
Answer is 1,200,000
Explanation:
return on sales after taxes = 6%
effective income tax rate = 40%, contribution margin = 30%.
Robin has fixed costs = $240,000,
We are to find the amount of sales required to earn the desired return using the information above.
Profit = Contribution - Fixed Cost
Assuming sales = K
6/(100-40)K = (30/100)K -240,000
0.1K =0.3K -240,000
0.2K =240,000
K = 240,000/0.2
so K =1,200,000.
Built-Tight is preparing its master budget for the quarter ended September 30. Budgeted sales and cash payments for product costs for the quarter follow.
July August September
Budgeted sales $54,000 $70,000 $58,000
Budgeted cash payments for
Direct material 15,160 12,440 12,760
Direct labor 3,040 2,360 2,440
Factory overhead 19,200 15,800 16,200
Sales are 15% cash and 85% on credit. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $15,000 in cash: $44,000 in accounts receivable; $3,500 in accounts payable; and a $4,000 balance in loans payable. A minimum cash balance of $15,000 is required. Loans are obtained at the end of any month when a cash shortage occurs. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. If an excess balance of cash exists, loans are repaid at the end of the month. Operating expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($3,000 per month), and rent ($5,500 per month).
Required:
a. Prepare a cash receipts budget for July, August, and September.
b. Prepare a cash budget for each of the months of July, August, and September.
Answer:
Built-Tight
a) Cash Budget for July, August, and September:
July August September Total
Beginning balance $15,000 $16,900 $28,700 $15,000
Cash collections: 52,100 56,400 68,200 176,700
Cash Expenses:
Direct materials (15,160) (12,440) (12,760 ) (40,360)
Direct labor (3,040) (2,360) (2,440) (7,840)
Factory overhead (19,200) (15,800) (16,200) (51,200)
Operating expenses:
Sales Commission (5,400) (7,000) (5,800) (18,200)
Rent Expense (3,000) (3,000) (3,000) (9,000)
Accounts Payable (4,000) (4,000)
Interest expense (400) (400)
Loan repayment (4,000) (4,000)
Minimum Balance 15,000 15,000 15,000
Excess Cash $1,900 $13,700 $41,700 $56,700
Explanation:
a) Cash Collections:
July August September Total
Cash sales 15% $8,100 $10,500 $8,700 $27,300
85% a month after 44,000 45,900 59,500 149,400
Total collections $52,100 $56,400 $68,200 $176,700
b) It is assumed that the balance in accounts payable was paid in August when the company had enough balance to offset it. Any other assumption could have been made.
c) A cash budget shows the cash receipts and payments made during the budget period. As a budget, it shows the forecast for cash receipts and payments, which will help management to make decisions to avoid liquidity problems which can ruin a business. Management is able to plan ahead for the business' expenditures and investments. It also warns management to negotiate for loans to smoothen periods of cash shortages.
Using $3040000 as the cost of goods manufactured, compute the cost of goods sold using the following information
Raw materials inventory, January 1 $ 20000
Raw materials inventory, December 31 40000
Work in process, January 1 18000
Work in process, December 31 12000
Finished goods, January 1 40000
Finished goods, December 31 32000
Raw materials purchases 1700000
Direct labor 760000
Factory utilities 150000
Indirect labor 50000
Factory depreciation 400000
Operating expenses 420000
a) $3046000.
b) $3048000.
c) $3032000.
d) $3008000.
Answer:
b) $3,048,000
The cost of goods sold is $3,048,000
Explanation:
Particulars Amount
Finished goods inventory (Jan 1) 40,000
Add: Cost of goods manufactured 3,040,000
Cost of goods available for sale 3,080,000
Less: Finished goods inventory (Dec 31) 32,000
Cost of goods sold 3,048,000
The dates of importance in connection with a cash dividend of $150,000 on a corporation's common stock are January 15, February 15, and March 15. Journalize the entries required on each date. If no entry is required, select "No Entry Required" and leave the amount boxes blank. Jan. 15 Feb. 15 Mar. 15
Answer:
The 3 dates of importance on Cash Dividends are the Date of Declaration, Date of Record, and Date of Payment.
The date of Declaration as inferred is the day the company announces the Dividend. There is an accounting entry for this.
The Date of Record is the day on which the company determines which shareholders are going to get dividends. There is no entry here.
The Date of payment is the day the dividends are disbursed. There is an accounting entry here.
Jan 15
DR Retained Earnings $150,000
CR Cash Dividends Payable $150,000
(To record declaration of Dividends)
Feb 15.
No entry
March 15
DR Cash Dividends Payable $150,000
CR Cash $150,000
(To record payment of Dividends).
Critically analyze the difference and points of convergence between floor inspection and functional inspection
Answer:
Please refer to the below;
Explanation:
Difference between Floor inspection and Functional inspection.
• Floor inspection is usually conducted in a production environment. It involves checking of materials while processing in the machine by inspectors. Rather than checking the materials in the machine at the beginning of production, floor inspection checks the materials while in process inorder to ensure that the defected ones are quickly detected and expunged. It also ensure that the equipments used in processing are properly functioning.
• Functional inspection is an inspection that checks the overall function of a product rather than what makes up the component parts. For instance the load capacity and speed of a vehicle can be checked for optimal performance whereas individual parts that make up the vehicle are not checked, yet bring out satisfactory performance when combined together. This form of inspection is concerned with verification of final output and does not provide details about different sections instead provides a wider understanding of comfort that emanate from inspecting same item.
Points of Convergence between Floor inspection and Functional inspection.
• The key objective of both floor and functional inspection is quality output having reviewed and examined their expectations.
• Both floor and functional inspection work to prevent defective product from flowing down the successive operations and avoid loss to the company
• Both floor and functional inspection aim at meeting customers requirements, wants and needs.
A package delivery service uses vans and employees to deliver the maximum number of packages given a fixed budget. The last van added 600 packages to total output, while the last employee added 500 packages. If vans cost exist400 per week and employees earn exist300 per firm:________.
a. could deliver more packages with the same budget by using more employees and fewer Vans
b. could deliver more packages the same budget by using more vans and fewer with employees
c. use more vans and fewer employees because the last dollars spent on vans added more to total output than the last dollar spent on employees
d. is delivering the maximum number of packages given the fixed budget
e. both b and c
Answer: e. both b and c
Explanation:
Van delivered 600 per week and cost $400.
The cost per package for the Van is;
= 600/400
= $1.5 per package
Employees delivered 500 and cost $300 which means the cost per package is;
= 500/300
= $1.67 per package.
The results show that it costs more to deliver with Employees ($1.67) than with the Vans ($1.5). Using more Vans will therefore allow for more packages to be delivered using a fixed budget as the last dollar spent on Vans gave more output than the last dollar spent on Employees.
Tetious Dimensions is introducing a new product and has an expected change in net operating income of $790,000. Tetious Dimensions has a 30 percent marginal tax rate. This project will also produce $190,000 of depreciation per year. In addition, this project will cause the following changes in year 1: Without the Project With the Project Accounts receivable $5,000 $84,000 Inventory 98,000 184,000 Accounts payable 75,000 117,000 What is the project's free cash flow in year 1? The free cash flow of the project in year 1 is $ 701000. (Round to the nearest dollar.)
Answer:
$620,000
Explanation:
to determine the net cash flow generated by the project, we can use the indirect method to determine cash flows:
net income = $790,000 x (1 - 30%) = $553,000
net income adjustments:
depreciation expense $190,000increase in accounts payable $42,000increase in accounts receivable ($79,000)increase in inventory ($86,000)Project's cash flow $620,000
Without the With the change
project project
Accounts receivable $5,000 $84,000 $79,000
Inventory $98,000 $184,000 $86,000
Accounts payable $75,000 $117,000 $42,000
Jason just joined a new gym and signed up for a one-year membership. Membership fees can be paid in 12 monthly payments of $50, due at the beginning of each month or in one payment today. If the appropriate interest rate is 11%,.How much should he pay today for the annual membership?
Answer:
$570.91
Explanation:
For computing, the amount pay today for the annual membership we just need to apply the present value formula i.e to be shown in the attachment
Provided that
Future value = $0
Rate of interest = 11% ÷ 12 months = 0.916666%
NPER = 12 months
PMT = $50
The formula is shown below:
= PV(Rate;NPER;PMT;FV;type)
So, after applying the above formula, the amount paid today for the membership is $570.91
Marcus is a self-employed marketing consultant. He is good at helping his clients with their marketing challenges; however, he is not keeping up with billing his clients regularly or keeping track of his hours. He feels like the time he spends on these functions is taking him away from activities where he has more talent and ability. His small business needs to bill clients quickly to keep the business running. What would you recommend that Marcus do
Answer:
outsource the accounting function to another firm
Explanation:
Based on this information regarding Marcus' situation, the best advice would be for him to outsource the accounting function to another firm. This is something that many individuals/companies do and will allow Marcus to focus all of his time and energy on what he is best at (which is helping his clients with their marketing challenges.) while at the same time making sure that the accounting tasks such as billing the clients are done quickly and correctly.
If a Starbucks tall latte cost $3.20 in the United States and 3 euros in the Euro area, then purchasing-power parity implies the nominal exchange rate is how many euros per dollar?
a. .938 If the exchange rate is less than this, it costs more dollars to buy a tall latte in the U.S. than in the Euro area.
b. .938 If the exchange rate is less than this, it costs fewer dollars to buy a tall latte in the U.S. then in the Euro area.
c. 1.067 If the exchange rate is less than this, it costs more dollars to buy a tall latte in the U.S. than in the Euro area.
d. 1.067 If the exchange rate is less than this, it costs fewer dollars to buy a tall latte in the U.S. than in the Euro area.
Answer:
a. .938 If the exchange rate is less than this, it costs more dollars to buy a tall latte in the U.S. than in the Euro area.
Explanation:
We can see in the example that the Euro is cheaper than the dollar in purchasing-power parity. More specifically, the exchange rate is .938 euros per dollar.
This is why it is more expensive to buy a tall latte in the U.S. than in Europe. The Euro is cheaper.
oe Smith, age 75, from Vienna, IL has the winning Powerball lottery numbers which will pay out $13 million at the beginning of each of the next 30 years (reported prize of $390 million). Before claiming his prize, Trusty Insurance Company offers Joe $200 million today in exchange for his winning lottery ticket and prize payout. What rate of return would Trusty Insurance earn if Joe accepts their offer?
Answer:
The IRR is 5%. Rate of return would be 12.5% assuming a discount rate of 4%
Explanation:
The answer depends entirely on the discount rate. The question covers a 30 period timeframe and in each period, the pay off is $13 million. This is a simple time value of money concept in which to calculate the present value, you will simply calculate the present value of each of the cash flows. The formula is 13Mn/[(1+r)^n] where n is the year from 1 to 30, r is the discount rate.
The question requires us to calculate the return that is the variable 'r'. For this you need to have the present value today so that you can then use the equation to solve for 'r'. However, the only information we have is the time period and the cash flow. We are given $200mn as the initial outlay. So, we can at least use this to calculate the internal rate of return (IRR) which is simply the rate of return (or the value of 'r') at which the present value of each of the 13 Mn to be received over the next 30 years is equal to the initial outlay (i.e 200mn). In short, IRR is the rate of return at which the net present value (NPV) is equal to zero. In our example, and using the formula for each of the cash flow from years 1 to 30, the IRR is computated at 5%. So if the discount rate that the company uses is less than 5%, the company would be better of with Joe accepting the offer because any discount rate below 5% would result in the present value of the cash flows to be in excess of $200Mn.
Lets take an example and assume that the discount rate is 4%, using the formula from year 1 to 30 and summing the values would give us a present value of $225 Mn. So the rate lf return in this case would be (225-200)/200 x 100 = 12.5%.
Valotic Tech Inc. sells electronics over the Internet. The Consumer Products Division is organized as a cost center. The budget for the Consumer Products Division for the month ended January 31 is as follows (in thousands):
1. Customer service salaries $546,840.00
2. Insurance and property taxes 114,660.00
3. Distribution salaries 872,340.00
4. Marketing salaries 1,028,370.00
5. Engineer salaries 836,850.00
6. Warehouse wages 586,110.00
7. Equipment depreciation 183,792.00
8. Total $4,168,962.00
During January, the costs incurred in the Consumer Products Division were as follows:
1. Customer service salaries $602,350.00
2. Insurance and property taxes 110,240.00
3. Distribution salaries 861,200.00
4. Marketing salaries 1,085,230.00
5. Engineer salaries 820,008.00
6. Warehouse wages 562,632.00
7. Equipment depreciation 183,610.00
8. Total $4,225,270.00
Required:
1. Prepare a budget performance report for the director of the Consumer Products Division for the month of January. Enter all amounts as positive numbers.
Valotic Tech Inc.
Budget Performance Report—Director, Consumer Products Division
For the Month Ended January 31, 2016
1 Budget Actual Over Budget Under Budget
2 Customer service salaries
3 Insurance and property taxes
4 Distribution salaries
5 Marketing salaries
6 Engineer salaries
7 Warehouse wages
8 Equipment depreciation
9 Total
2. For which costs might the director be expected to request supplemental reports?
Answer:
Total Over budget = $112370
Total Under Budget= $ 56062
Explanation:
Valotic Tech Inc.
Budget Performance Report—Director, Consumer Products Division
For the Month Ended January 31, 2016
Budget Actual (Over) Under Budget
Customer service salaries $546,840 $602,350 (55,510)
Insurance & property taxes 114,660 110,240 4420
Distribution salaries 872,340 861,200 11,140
Marketing salaries 1,028,370 1,085,230 (56,860)
Engineer salaries 836,850 820,008 16842
Warehouse wages 586,110 562,632 23478
Equipment depreciation 183,792 183,610 182
Total $4,168,962 $4,225,270 (56308)
Total Over budget = $112370
Total Under Budget= $ 56062
Over budget means that the amount is spent more than the amount budgeted.
The Customer service salaries and Marketing salaries are over budgeted and the the director is expected to request supplemental reports of these to analyze where the amount has been overspent.
Athena Company's salaried employees earn two weeks of vacation per year. It pays $858,000 in total employee salaries for 52 weeks but its employees work only 50. Record Athena Company's weekly journal entry to record the vacation expense:
Answer:
Answer is Debit Vacation Benefits Expense $660 Credit Vacation Benefits Payable $660
Explanation:
Athena Company's salaried employees earn two weeks of vacation per year. It pays $858,000 in total employee salaries for 52 weeks but its employees work only 50. Record Athena Company's weekly journal entry to record the vacation expense:
Annual salary is $858,000 in total
The total no of weeks is 52 weeks
858,000 wages per year / 52 weeks per year = 16,500 per week
So per week salary is
The weekly wages for our employees are 16,500 dollars
For each of the two weeks of vacations , will be $ 16500 x 2
= $33,000
For weekly vacation expense
sice its for 50 weeks
= $33000 / 50
= $660
Therefore, Debit Vacation Benefits Expense $660 Credit Vacation Benefits Payable $660
Typically, the firms' lowest cost source of financing is ____________ as its cost is tax deductible and it also tends to offer the least amount of risk for investors. Group of answer choices Debt Preferred Equity Derivatives Common Equity Equity
Answer:
Debt
Explanation:
Debt is the lowest cost source of financing because the interest return given to holders of debt has a tax shield (tax deductible) that is provided by the Section 11j of the Income tax Act.
The other sources of finance give a return in form of dividends. Dividends are are not tax deductible hence they attract a huge cost.
Nielson Motors is considering an opportunity that requires an investment of $1,000,000 today and will provide $250,000 one year from now, $450,000 two years from now, and $650,000 three years from now. If the appropriate interest rate is 15%, then Nielson Motors should
Answer:
The NPV is - $14958.49 . The opportunity should not be pursued as the NPV of the project discounted at the interest rate of 15% comes out to be negative . Thus, Nielson Motors should not proceed with the project.
Explanation:
To determine whether the project should be accepted or not, we need to calculate the NPV or Net Present Value of the project. If the NPV is positive, the project should be accepted.
The formula to calculate the NPV is attached.
NPV = - 1000000 + 250000 / (1 + 0.15) + 450000 / (1 + 0.15)² +
650000 / (1 + 0.15)³
NPV = - $14958.49429
The opportunity should not be pursued as the NPV of the project discounted at the interest rate of 15% comes out to be negative. Thus, Nielson Motors should not proceed with the project.
The following data are provided:
December 31
2018 2017
Cash $ 1,500,000 $ 1,000,000
Accounts receivable (net) 1,600,000 1,200,000
Inventories 2,600,000 2,200,000
Plant assets (net) 7,000,000 6,500,000
Accounts payable 1,100,000 800,000
Income taxes payable 200,000 100,000
Bonds payable 1,400,000 1,400,000
10% Preferred stock, $50 par 2,000,000 2,000,000
Common stock, $10 par 2,400,000 1,800,000
Paid-in capital in excess of par 1,600,000 1,300,000
Retained earnings 4,000,000 3,500,000
Net credit sales 12,800,000
Cost of goods sold 8,400,000
Operating expenses 2,900,000
Net income 1,500,000
Additional information:
Depreciation included in the cost of goods sold and operating expenses is $1,220,000. On May 1, 2018, 60,000 shares of common stock were issued. The preferred stock is cumulative. The preferred dividends were not declared during 2018.
The accounts receivable turnover for 2018 is____________.
a. 12,800 / 1,600.
b. 8,400 / 1,600.
c. 12,800 / 1,400.
d. 8,400 / 1,400.
The inventory turnover for 2018 is____________.
a. 12,800 / 2,600.
b. 8,400 / 2,600.
c. 12,800 / 2,400.
d. 8,400 / 2,400.
The profit margin on sales for 2018 is______________.
a. 4,400 / 12,800.
b. 1,500 / 12,800.
c. 4,400 / 8,400.
d. 1,500 / 8,400
The return on common stock holders’ equity for 2018 is______________.
a. 1,500 / 7,200.
b. 1,500 / 8,000.
c. 1,300 / 7,200.
d. 1,300 / 8,000.
The book value per share of common stock at 12/31/18 is_____________
a. 7,800 / 240.
b. 7,760 / 240.
c. 7,800 / 220.
d. 8,000 / 220.
Answer:
The accounts receivable turnover for 2018 is 9.14.
accounts receivable turnover = net sales / average accounts receivable, in thousands it would equal:
c. 12,800 / 1,400.
The inventory turnover for 2018 is 3.5.
inventory turnover = cost of goods sold / average inventories, in thousands it would equal:
d. 8,400 / 2,400.
The profit margin on sales for 2018 is 11.72%.
profit margin = net income / net sales, in thousands it would equal:
b. 1,500 / 12,800.
The return on common stockholders’ equity for 2018 is 18.75%.
return on equity = net income / equity, in thousands it would equal:
b. 1,500 / 8,000.
The book value per share of common stock at 12/31/18 is $36.36
book value per share of common stock = (total stockholders' equity - preferred stocks) / average number of common stocks, in thousands it would equal:
d. 8,000 / 220
Hannah Roberts owns and operates Hannah's Pool Service Company. On January 1, Hannah Roberts, Capital had a balance of $309,170. During the year, Hannah invested an additional $22,040 and withdrew $39,010. For the year ended December 31, Hannah's Pool Service Company reported a net income of $55,080.
Prepare a statement of owner's equity for the year ended December 31. Hannah's Pool Service Company Statement of Owner's Equity For the Year Ended December 31.
Answer:
Hannah's Pool Service Company
Statement of owner equity for the year ended December 31
Particulars Amount
Capital (January 1) $309,170
Investment during the year $22,040
Net Income $55,080
Withdrawals during the year (-$39,010)
Increase in the owner equity $38,110
Capital (December 31) $347.280
Workings
a. Increase in the owner equity = Investment during the year + Net income - withdrawal during the year
=$22040+$55080 -$39010
=$38110
b. Capital (December 31) = Capital on January 1 + Increase in owner equity
=$309170 +$38110
=$347280
The following inventory balances have been provided for the most recent year: The cost of goods manufactured was $714,000. What was the cost of goods sold? Select one: a. $738,000 b. $693,000 c. $714,000 d. $733,000
Answer:
a. $738,000
Explanation:
Calculation for the cost of goods sold
Beginning Finished goods inventory $57,000
Add: Cost of goods manufactured $714,000
Goods available for sale $771,000
($714,000+$57,000)
Less Ending Finished goods inventory $33,000
Cost of goods sold $738,000
($771,000-$33,000)
Therefore the cost of goods sold will be $738,000
Why are adjustments made to the accounting records at the end of the period? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
Answer: a. To ensure assets and liabilities are reported at appropriate amounts.
b. To ensure the related revenues and expenses are reported in the proper period.
Explanation:
Adjustments must be made at the end of the period to make sure that the figures in the books are the proper and true reflection of the transactions that took place. That way records are neither overstated or understated thereby giving the users of the Accounting records a proper and accurate opportunity to assess the company's financial standing.
Records must also be adjusted to abide by the Accrual basis in accounting which posits that revenues and expenses should be recorded only in the periods when they occured regardless of if money has been received or paid for them. This way it is easier to match Expenses as well as Revenue to their respective periods.
Tracy and Brett are married. Their current assets $9,243 Their current liabilities $6,921 Their monthly nondiscretionary expenses $4,693 Their annual combined income $70,000 Their annual debt payments (excluding monthly housing costs) $22,084 What is Tracy and Brett's emergency fund ratio in months
Answer:
1.3355
Explanation:
Current ratio = cash + cash equivalents ÷ current liabilities =$9,243 ÷ $6,921 =1.3355
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$1.3355 is Tracy and Brett's emergency fund ratio in months. As Tracy and Brett are married. Their current assets $9,243 Their current liabilities $6,921 Their monthly nondiscretionary expenses $4,693.
What are current assets?Current assets are all of a company's assets that are planned to be sold or used in the course of normal business operations during the course of the following year.
Current assets include things like cash, cash equivalents, receivables, stock inventory, marketable securities, pre-paid liabilities, and other liquid assets.
Current assets are items that a corporation utilizes, replaces, or turns into cash during a typical operating cycle. They are also known as short-term assets It sets them apart from long-term assets, or those that a company uses for longer than a year.
Thus, it is $1.3355.
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Last year, Rotterdam, Inc. had sales revenue of $980,000. Costs other than depreciation and interest expense were 20 percent of sales. Depreciation expense was $50,000, interest expense was $95,000, and dividends paid were $23,000. The company also received dividends of $8,000 from a company in which it had 30% ownership stake. Which of the following statements is most CORRECT?a. The firm's taxable income was $637,400. b. The firm's after-tax income was $405,564. c. The firm's marginal tax rate was 39 percent. d. The firm's tax for the year was $113,900. e. None of the above
Answer:
e. None of the above
Explanation:
total revenue $980,000
- operating costs $196,000
- depreciation $50,000
- interests $95,000
income $639,000
+ dividends from outside corporation = $8,000 x (1 - 80% DRD) = $1,600
total taxable income = $639,000 + $1,600 = $640,600
current corporate tax is 21%, so the company's marginal tax rate would be 21%
income taxes for the year = $640,600 x 21% = $134,526
the company's after tax income = $640,600 - $134,526 = $506,074
On January 1, 2021, Perez Co. issued at par $10,000 of 6% bonds convertible in total into 1,000 shares of Perez's common stock. No bonds were converted during 2021. Throughout 2021, Perez had 1,000 shares of common stock outstanding. Perez's 2021 net income was $4,500, and its income tax rate is 30%. No potentially dilutive securities other than the convertible bonds were outstanding during 2021. Perez's diluted earnings per share for 2021 would be:_________.a. $5.00.
b. $4.54.
c. $4.50.
d. $4.72.
Answer:
EPS = $4.50
diluted EPS = $2.46
Explanation:
no option is correct since EPS = $4.50, and the rest of the options are all higher amounts. Diluted EPS are always smaller than EPS.
common stock outstanding = 1,000 stocks
bonds shares (diluted) = 1,000 stocks
net income = $4,500
bond interest = $10,000 x 6% x (1 - 30%) = $420
diluted earnings per share = ($4,500 + $420) / (1,000 shares + 1,000 shares) = $4,920 / 2,000 shares = $2.46