Answer:
E. The supply curve for seat belts will shift to the right.
Explanation:
When a government establishes a subsidy, it is basically giving money to private people or businesses. In this case, the government's money should in crease the supply of seat belts by lowering their costs. This increase in the supply should shift the supply curve to the left and hopefully help to lower the price of seat belts (besides increasing the quantity supplied).
Merando Industries employs a 5-day workweek and a September 30 year-end. Normal weekly wages amount to $41760. If September 30 ends on a Wednesday, what is the appropriate journal entry at fiscal year-end
Answer:
Debit: Salaries and wages expense $25,056
Credit: Salaries and wages payable $25,056
(To recognize the salaries and wages payable at year-end)
Explanation:
Merando Industries employs a 5-day workweek - this means $41,760 normal weekly wages can be divided by 5 to arrive at the daily workweek wages, which is $41,760 / 5 = $8,352.
If the fiscal year-end is a Wednesday, the company has to recognize a salaries and wages payable of $25,056 due to the following:
the workweek remains 2 weekdays to completethe company pays at the completion of the 5-day workweekthere is no need to recognize the remaining 2 days next year as salaries and wages payable since the employer may not have control over the employees - they may decide the exit the companySo, the amount to be recognized will be $8,352 x 3 = $25,056.
In the 2020 CARES Act, most Americans received $1,200 stimulus checks (sorry college students). Will people spend most of the money they receive (like in the simple MPC model) or will they save most of it? Why?
Answer:
Individuals won't go through the vast majority of the cash as indicated by the MPC fo ordinary occasions. Despite the fact that the $1200 will add to the buying intensity of the individuals and those individuals who have lost positions and are battling to get by will spend on the essential things, the MPC during an emergency or downturn is a lot of lower than ordinary occasions.
It is a result of the vulnerability made by the emergency. Individuals don't have a clue how much their pay can be sooner rather than later and they need to spare as much as could be expected under the circumstances with the goal that they can make sure about their future.
Their longing to spare increments in a monetary emergency. Along these lines, the vast majority of the $1200 will be spared, and generally, just necessities will be expended out of the additional pay.
"What marketing metric determines whether a TV program such as The Big Bang Theory remains on the CBS broadcast TV network
Answer:
It's the rating
Explanation:
The higher the rating the more the network will put it on TV
You know that the assets of a firm BIG are today worth 100mil. You reasonably feel that in a year they will be either worth 110mil or 90mil. You also know that a riskless zero coupon bond maturing in one year is offering today a yield of 5%. The firm has issued a zero-coupon bond that matures in one year and has a face value of 100mil. 1. What should be the value of this corporate bond today? 2. What should be its yield to maturity? 3. What should be the value of the equity of the firm? 4. Can you do a further analysis of this problem?
Answer:
(1) 95.23 (2)5.008% or 5% (3) The value of equity is zero (4)The future value of the firm will be 110 mil. than Firm equity will be 110-100 =10 mil not zero
Explanation:
Solution
Given that:
The worth in good in this example= 110 mil
Worth in bad in this example =90 mil
The future value =( 110+90)/2
=100
Future value = 100
Now
(1) The Present value = F/(1+r)^n
=100/1.05
=95.23
(2) the yield to maturity is given below:
YTM = (FV/PV)^n -1
Here
FV = future value
PV = present value
n=years
Thus
(100/95.23)^1 -1
=5.008% or 5%
Since the bond are zero coupon bond so interest rate is equal to YTM
(3) The total worth =100 mil
Thus
The Debt +equity =100
100+equity =100
Equity =100-100
=0
Hence the value of equity is zero.
The firm BIG is only debt firm. Firm do not have equity.
(4) The future value of the firm will be 110 mil. than Firm equity will be 110-100
=10 mil not zero
Ferris Company began January with 6,000 units of its principal product. The cost of each unit is $5. Merchandise transactions for the month of January are as follows: Purchases Date of Purchase Units Unit Cost* Total Cost Jan. 10 5,000 $ 6 $ 30,000 Jan. 18 6,000 7 42,000 Totals 11,000 72,000 * Includes purchase price and cost of freight. Sales Date of Sale Units Jan. 5 3,000 Jan. 12 2,000 Jan. 20 4,000 Total 9,000 8,000 units were on hand at the end of the month. Required: 1. Calculate January's ending inventory and cost of goods sold for the month using FIFO, periodic system.
Answer:
Cost of goods sold = $210,000
Ending inventory = $54,000
Explanation:
The computation of the ending inventory and the cost of goods sold using the FIFO periodic system is shown in the attachment below
The periodic inventory system is the system in which the inventory is maintained in periodic intervals like monthly, half-yearly, quarterly, yearly. There is no need to update the inventory to the latest date.
While the FIFO method refers to the method in which the inventory that is first purchased should be considered first and then the remaining inventory should be considered on date wise
Xion Co. budgets a selling price of $81 per unit, variable costs of $35 per unit, and total fixed costs of $281,000. During June, the company produced and sold 11,900 units and incurred actual variable costs of $362,000 and actual fixed costs of $296,000. Actual sales for June were $995,000. Prepare a flexible budget report showing variances between budgeted and actual results.
Answer:
Total Variance 70,600 fav.
Explanation:
Xion Co.
Budget Analysis
Acutal Budgeted Variances
No of Units 11900 11900
Sales Price Per unit $ 83.61 $ 81
Sales Price $ 995,000 963,900 31,100 fav
Variable Cost Per unit 30.42 $ 35
Variable Costs $ 362,000 416500 54,500 fav
Contribution Margin $ 633,000 547,400 85,600 fav
Fixed Costs 296,000 $281,000 15,000 unfav
Gross Profit 337,000 266400 70,600 fav
We multiply the individual budgeted costs to the number of units to find the total budgeted costs. When the actual Revenues are greater than the budgeted revenues they are favorable. Similarly when the budgeted costs are greater than the actual costs they are also favorable.
On December 2, Coley Corp. reacquired 1,000 shares of its $2 par value common stock for $27 each. On December 20, Coley Corp. reissued 400 shares for $15 each. Which of the following is correct regarding the journal entry for the reissued shares?
a. Debit Cash $15,000.
b. Credit Treasury Stock $10,800.
c. Credit Paid in Capital - Treasury Stock $5,200.
d. Credit Treasury Stock $6,000.
Answer:
b. Credit Treasury Stock $10,800.
Explanation:
The Journal entry is shown below:-
Cash Dr, $6,000 (400 × $15)
Retained Earnings Dr, $4,800
To Treasury Stock $10,800 (400 × 27)
(Being reissued shares is recorded)
Here we debited the cash and retained earnings as it increased the cash and reduced the retained earning balance and we credited the treasury stock as it reduced the balance of treasury stock
On December 28, 20X3, Stern Corporation and Ram Company established S&R Partnership, with cash contributions of $14,000 and $42,000, respectively. The partnership’s purpose is to purchase from Stern accounts receivable that have an average collection period of 90 days and hold them to collection. The partnership borrows cash from Midtown Bank and purchases the receivables without recourse but at an amount equal to the expected percent to be collected, less a financing fee of 5 percent of the gross receivables. Stern and Ram hold 20 percent and 80 percent of the ownership of the partnership, respectively, and Stern guarantees both the bank loan made to the partnership and a 15 percent annual return on the investment made by Ram. Stern receives any income in excess of the 15 percent return guaranteed to Ram. The partnership agreement provides Stern total control over the partnership’s activities. On December 31, 20X3, Stern sold $8,080,000 of accounts receivable to the partnership. The partnership immediately borrowed $7,580,000 from the bank and paid Stern $7,440,000. Prior to the sale, Stern had established a $414,000 allowance for uncollectibles on the receivables sold to the partnership. The balance sheets of Stern and S&R immediately after the sale of receivables to the partnership contained the following:
Stern Corporation S&R Partnership
Cash $8,036,000 $373,000
Accounts Receivable 4,380,000 8,080,000
Allowance for Uncollectible Accounts (212,000) (414,000)
Other Assets 5,420,000
Prepaid Finance Charges 404,000
Investment in S&R Partnership 11,000
Accounts Payable 942,000
Deferred Revenue 404,000
Bank Notes Payable 7,580,000
Bonds Payable 9,770,000
Common Stock 697,000
Retained Earnings 6,630,000
Capital, Stern Corporation 11,000
Capital, Ram Company 44,000
Required:
Assuming that Stern is S&R's primary beneficiary, prepare a consolidated balance sheet for Stern at January 1, 20X4.
Answer:
Total Assets $25,663,000
Total Liabilities and Stockholders’ Equity $25,663,000
Explanation:
Preparation of the prepare a consolidated balance sheet for Stern at January 1, 20X4
Stern CorporationConsolidated Balance StatementJanuary 1, 20X4
ASSET:
Cash $8,409,000
($8,036,000 +$373,000)
Accounts Receivable $12,460,000
( 4,380,000 +8,080,000)
Allowance for Uncollectible Accounts ($626,000)
[(212,000) (414,000)]
Other Assets 5,420,000
Total Assets $25,663,000
LIABILITIES:
Accounts Payable 942,000
Bank Notes Payable 7,580,000
Bonds Payable 9,770,000
Shareholders’ Equity
Controlling Interest:
Common Stock 697,000
Retained Earnings 6,630,000
Total Controlling interest $7,327,000
(6,630,000+697,000)
Non controlling interest $44,000
Total Liabilities and Stockholders’ Equity $25,663,000
Therefore consolidated balance sheet for Stern at January 1, 20X4 will have a Total Assets of $25,663,000 and a Total Liabilities and Stockholders’ Equity of $25,663,000
A company is considering the purchase of a new machine for $49,000. Management predicts that the machine can produce sales of $16,100 each year for the next 10 years. Expenses are expected to include direct materials, direct labor, and factory overhead totaling $7,900 per year including depreciation of $4,100 per year. Income tax expense is $3,280 per year based on a tax rate of 40%. What is the payback period for the new machine?
Answer:
7.47 years
Explanation:
Payback period calculates the amount of the time it takes to recover the amount invested in a project from its cumulative cash flows.
= amount invested / cash flows
To derive cash flow: (S - C - D) x (1 - t) + D
S = sales = $16,100
C = Cost of goods sold = $7,900
D = deprecation = $4,100
T = tax = 40%
$16,100 - $7,900 - $4,100 = $4100
$4100 × 0.6 = $2460
$2460 + $4,100 = $6560
$49,000 / $6560 = 7.47 years
I hope my answer helps you
J's Foods is trying to estimate the cash flows in their first year of operation. They project that the firm will have sales of 100,000; operating costs of 50,000; and depreciation of 10,000. If their tax rate is 29% what would the firm's operating cash flow equal?
Answer:
$38,400
Explanation:
The computation of operating cash flow is shown below:-
Operating cash flow = (Sales - operating costs - depreciation) × (1 - tax) + depreciation
= (100,000 - 50,000 - 10,000) × (1 - 0.29) + 10,000
= (40,000) × (0.71) + 10,000
= $38,400
Therefore for computing the operating cash flow we simply applied the above formula.
McGaha VIllage operates a sanitation department as part of its general government activities. McGaha Village will acquire new sanitation trucks that will be financed through the issuance of general obligation bonds. McGaha Village uses a Capital Projects Fund and a Debt Service Fund to account for the transactions. Make journal entries to record the following transactions and events and indicate the appropriate fund in which the transactions are recorded.
1. April1. McGaha Village issues bonds for their face amount of $300,000
2. April1. McGaha Village acquires sanitation trucks at a total cost of $300,000 for cash. The trucks have an estimated useful life of 10 years.
3. October 1. McGaha Village records the fund liability and pays the first installment of principal ($15,000) and interest ($7,500) on the long term debt.
Answer:
McGaha Village
Journal Entries:
April 1:
Debit Cash Account $300,000
Credit Bonds Payable $300,000
To record the issue of bonds.
April 1:
Debit Sanitation Trucks $300,000
Credit Cash Account $300,000
To record the acquisition of sanitation trucks for cash.
April 1:
Debit Cash Account $300,000
Credit Debt Service Fund $300,000
To record the transfer of funds.
October 1:
Debit Capital Projects Fund $300,000
Credit Debt Service Fund $300,000
To record the funds liability.
Debit Bonds Payable $15,000
Credit Cash Account $15,000
To record the repayment of the bonds.
Debit Interest Expenses $7,500
Credit Cash Account $7,500
To record the payment of interest on the long-term debt.
Explanation:
Journal entries help to initiate the recording of transactions. They show the accounts to be debited and credited in the General Ledger. They have some short narrations which explain the transaction.
An underpinning of all commerce is effective communications, knowledge of where goods and services exit and where they are needed and the ability to communicate instantaneously across vast distances. Facilitation this movement into the future one can observe which shifts in examining world population and telecommunications?
Explanation:
Analyzing the historical context, it is possible to see how the new communication technologies were essential for the development of commerce. We currently live in the digital age, where almost every individual has access to a cell phone with internet and can communicate within seconds with any part of the world.
This technological revolution also had a great economic impact, generating new business models.
Companies have to adapt to this reality and insert themselves in the new market based on the internet, in creating relationships with consumers, in the practice of positive social and environmental attitudes, etc. Some companies needed to reinvent themselves to adapt to the new economic context, or they would lose strength in the market and would cease to exist.
The fact is that the technological revolution has impacted commercial relations around the world, today the consumer seeks the solution to his problems and desires, not being restricted to local consumption, which causes a new redesign of commerce and manages impacts on the economy of the world.
which of the following situations will likely result in the highest price for a good?
-high demand and high supply
-low demand and high supply
-low supply and low demand
-low supply and high demand
Answer:
low supply and high demand
Explanation:
The situation that will most likely result in the highest price for a good is 'low supply and high demand. When there is a low supply of a product that is highly desired by consumers, companies will take this as an opportunity to raise said products price if they have it in stock. A good example of this is the shortage in supply of toilet paper that occurred at the start of the 2020 pandemic. Since there was such a high demand for toilet paper and a rather low supply of it, businesses began to increase their prices when they had it in stock.
On December 31, Jarden Co.'s Allowance for Doubtful Accounts has an unadjusted credit balance of $14,000. Jarden prepares a schedule of its December 31 accounts receivable by age. Accounts Receivable $ 860,000 344,000 68,800 34,400 13,760 Age of Accounts Receivable Not yet due 1 to 30 days past due 31 to 60 days past due 61 to 90 days past due Over 90 days past due Expected Percent Uncollectible 1. 20% 1.95 6.45 32.50 67.00
Required:
1. Compute the required balance of the Allowance for Doubtful Accounts at December 31.
Accounts Receivable Percent Uncollectible (#.##%) Estimated Uncollectible Not due: 1 to 30: 31 to 60: 61 to 90: Over 90: Estimated balance of allowance for uncollectibles
2. Prepare the adjusting entry to record bad debts expense at December 31. (Round percentage answers to nearest whole percent. Do not round intermediate calculations.)
Answer and Explanation:
a. The required balance of allowance for doubtful debts is shown below:
Particulars Account receivable % Estimated uncollectible
Not yet due $860,000 1.20% $10,320
1 to 30 days $344,000 1.95% $6,708
31 to 60 days $68,800 6.45% $4,438
61 to 90 days $34,400 32.50% $11,180
Over 90 days $13,760 67.00% $9,219
Estimated balance $41,865
b. The adjusting entry is
Bad debt expense Dr ($41,865 - $14,000) $27,865
To Allowance for doubtful debts $27,865
(being the bad debt expense is recorded)
For recording this we debited the bad debt expense as it increased the expenses and credited the allowance for doubtful debts as it decreased the assets
You plan to invest $300 today and $500 three years from today. Two years from today, you plan to withdraw $50. Which of these is a correct statement regarding a time line for computing the future value of your cash flows four years from today?
A. The cash flow at year 4 is a negative $500.B. The cash flow at year 3 is a negative $500.C. The cash flow at year 2 is a negative $50.D. The cash flow at time 0 is a positive $300.
Answer: B. The cash flow at year 3 is a negative $500.
Explanation:
When money is invested into a venture, it is denoted with a negative sign (-) to indicate that this is money leaving the investor as opposed to a positive sign (+) to show when money is coming back to the investor.
In year 3, the investor invested $500 so in year 3 the Cashflow was -$500.
Pureform, Inc., uses the weighted-average method in its process costing system. It manufactures a product that passes through two departments. Data for a recent month for the first department follow:
Units Materials Labor Overhead
Work in process inventory, beginning 59,000 $ 61,600 $ 15,700 $ 29,100
Units started in process 559,000
Units transferred out 580,000
Work in process inventory, ending 38,000
Cost added during the month $ 815,215 $ 193,285 $ 359,015
The beginning work in process inventory was 85% complete with respect to materials and 70% complete with respect to labor and overhead. The ending work in process inventory was 65% complete with respect to materials and 45% complete with respect to labor and overhead.
Required:
1. Compute the first department's equivalent units of production for materials, labor, and overhead for the month.
2. Determine the first department's cost per equivalent unit for materials, labor, and overhead for the month. (Round your answers to 2 decimal places.)
Materials Labor Overhead
1. Equivalent units of production
2. Cost per equivalent unit
Answer and Explanation:
1. The computation of the first department's equivalent units of production for materials, labor, and overhead for the month is shown below with the help of below formulas
Material equivalent units of production
= Units completed and transferred out + Ending work in process in units
Labor equivalent units of production
= Units completed and transferred out + Ending work in process in units
Equivalent units of production
= Units completed and transferred out + Ending work in process in units
2. The computation of the second part is done by using the spreadsheet. Kindly find it below
amantha was ill for four months this year. Samantha missed work during this period, but disability insurance paid $18,000 of disability pay to replace her missed salary. Samantha shares the cost of the insurance with her employer. This year Samantha's employer paid $2,200 in disability premiums for Samantha as a nontaxable fringe benefit and Samantha paid the remaining $1,100 of premiums from her salary. What amount of the disability pay must Samantha include in her gross income (Rounded to the nearest whole dollar)
Answer: $12,000
Explanation:
Disability Insurance paid $18,000 to Samantha but Samantha had to pay $1,100 in premiums for the disability insurance while her employer paid $2,200. This premium that they both paid is the cost of her insurance payout for disability.
Her gross income will therefore be;
= [tex]\frac{2,200}{2,200 + 1,100}[/tex] * 18,000
= $12,000
This is her income because this is the percentage of the payout that was covered by her insurer.
When Shondra shops at the warehouse club, she buys paper towels and tissues in bulk. What type of packaging do these products come in
Answer:
Unit load
Explanation:
A unit-load packaging is used for loading individual goods together and shipping the package into a single box. Another choice is not appropriate for this form of packaging as they're concerned about carton packaging and shipping container related packaging.
Therefore in the given since she wants to buy the paper towels and tissues in bulk so it reflects the unit load as it derives the same meaning
Hence, the correct option is the unit load.
All of the following statements regarding stock dividends are true except : A. Stock dividends provide evidence of management's confidence that the company is doing well. B. Directors can use stock dividends to keep the market price of the stock affordable. C. Stock dividends decrease the number of shares outstanding. D. Stock dividends do not reduce assets or equity. E. Stock dividends transfer a portion of equity from retained earnings to contributed capital.
Answer: Stock dividends decrease the number of shares outstanding.
Explanation:
A stock dividend does not affect the total equity, but rather the transfer amounts that exists between the components of the equity.
Stock dividends also shows evidence of the confidence of the management that the company is doing well and that the directors can use it to keep market price of stock affordable.
The option that Stock dividends decrease the number of shares outstanding is not true.
If the ending inventory of a firm is overstated by $50,000, by how much and in what direction (overstated or understated) will the firm's operating income be misstated? (Hint: Use the cost of goods sold model, enter hypothetically "correct" data, and then reflect the effects of the ending inventory error and determine the effect on cost of goods sold.)
Answer:
50,000 overstated.
Explanation:
As the ending inventory is overstated by 50,000 we can conclude the implications using the inventory identity:
Beginning + Purchase = COGS + Ending
As the left side will be the correct display they will have no error.
Therefore the COGS will compensate the mistake in the ending ivnentory
0 = COGS + 50,000
COGS = -50,000
The COGS are 50,000 lower than it should be therefore the gross profit is overstated as
Sales - COGS = Gross Profit
0 - (-50,000) = Gross Profit
+ 50,000 = Gross Profit
This also makes the operating income which, derives from gross profit to be overstated as well.
Charter Company, which uses the perpetual inventory method, purchases different letters for resale. Character had a beginning inventory comprised of nine units at $3 per unit. The company purchased four units at $5 per unit in February, sold seven units in October, and purchased five units at $6 per unit in December. If Charter Company uses the LIFO method, what is the cost of goods sold for the year
Answer:
Cost of Goods sold is $29
Explanation:
Under the perpetual LIFO or Last In First Out method of inventory valuation, we value the Cost of Goods Sold based on the price of the most recently purchased inventory before sale. Thus the units of closing inventory contains the inventory that was purchased first.
The cost of goods sold under LIFO will be,
Beginning Inventory (9* 3) = 27
Feb purchases (4 * 5) = 20
Oct sales (4 * 5 + 3 * 3) = (29)
Dec purchases (5 * 6) = 30
Ending Inventory = 48
So, the cost of goods sold under perpetual LIFO will comprise of the most recently purchased inventory before sale. The most recently purchased inventory before October sale was of February purchases. Thus, out of the 7 units sold, 4 will comprise of the February purchases and the remaining, 3 units, will be from the beginning inventory.
The cost of goods sold is,
COGS = 4 * 5 + 3 * 3
COGS = 29
Rice Corp. recognizes revenue over time to account for long-term contracts and has the following information for the first year of the contract:
Contract price $500,000
Total expected costs on contract 400,000
Costs incurred in current year 60,000
Costs incurred in previous years 0
What is the amount of revenue recognized in year 1?
A.) $100,000
B.) $500,000
C.) $60,000
D.) $75,000
Answer:
D.) $75,000
Explanation:
Amount of revenue recognized = Cost incurred to date / Estimated total cost * Contract price
Cost incurred to date=60,000
Estimated total cost=400,000
Contract price=500,000
Amount of revenue recognized= 60,000/400,000 * 500,000
=0-15 * 500,000
=$75,000
Amount of revenue recognized in year 1 is $75,000
Given the following selected information on McMillen's Chocolate, Inc., calculate Cash Flow from Operating Activities for 2012. Show your work.
2011 2012
EAT $ 600,000 800,000
Depreciation Exp. 100,000 120,000
Dividends 400,000 550,000
Accounts Receivable 1,500,000 1,000,000
Inventory 3,500,000 4,100,000
Accts. Payable 350,000 350,000
Accruals 250,000 200,000
Long-Term Debt 2,300,000 2,000,000
Common Stock 2,200,000 3,000,000
Interest expenses 50,000 60,000
Retained Earnings 6,150,000 6,400,000
Answer:
Cash flow from operating activities for the Year 2012 = $770000.
Explanation:
Particulars Amount ($)
Earnings after tax (EAT) 800,000
+ Depreciation (Non-cash expenditure) 120,000
Operating profit before working 920,000
capital changes
+ Decrease in accounts receivable 500,000
(1,500,000 - 1,000,000)
- increase in inventory 600,000
(4,100,000 - 3,500,000)
- Decrease in accrual 50,000
(250,000 - 200,000)
Cash flow from operating activities 770,000
Conclusion:- Cash flow from operating activities for the Year 2012 = $770000.
Suppose at December 31 of a recent year, the following information (in thousands) was available for sunglasses manufacturer Oakley Inc.: ending inventory $156,748; beginning inventory $108,738; cost of goods sold $348,930 and sales revenue $757,813.
Required:
a. Calculate the inventory turnover for Oakley, Inc. (Round inventory turnover to 2 decimal places, e.g. 5.12.)
b. Calculate the days in inventory for Oakley, Inc. (Round days in inventory to 0 decimal places, e.g. 125.)
Answer:
a. 2.63
b. 139 days
Explanation:
a. Inventory Turnover is a ratio that measures how often inventory is replaced by a company. A higher ratio is good because it means that the company is selling more.
Formula;
= [tex]\frac{Cost of Goods Sold}{ \frac{Beginning Inventory + Closing Inventory}{2} }[/tex]
= [tex]\frac{348,930}{ \frac{108,738 + 156,748}{2} }[/tex]
= [tex]\frac{348,930}{132,743}[/tex]
= 2.63
b. Days in Inventory refers to the amount of time that stock remains in the company before it is sold. This is preferred to be lower as opposed to higher.
= [tex]\frac{365}{Inventory Turnover Ratio}[/tex]
= [tex]\frac{365}{2.63}[/tex]
= 138.78
= 139 days
During the year a parent makes sales of inventory at a profit to its 75 percent owned subsidiary. The subsidiary also makes sales of inventory at a profit to its parent during the same year. Both the parent and the subsidiary have on hand at the end of the year 20 percent of the inventory acquired from one another. Consolidated revenues for the year should exclude:________.
a) 80 percent of the total revenues from intercompany sales.
b) only the revenues from the subsidiary's intercompany sales.
c) only the revenues from the parent's intercompany sales.
d) total revenues from intercompany sales. A
Answer: total revenues from intercompany sales.
Explanation:
From the question, we are informed that during the year a parent makes sales of inventory at a profit to its 75 percent owned subsidiary and that the subsidiary also makes sales of inventory at a profit to its parent during the same year.
We are further told that both the parent and the subsidiary have on hand at the end of the year 20 percent of the inventory acquired from one another.
In this case, the consolidated revenues for the year should exclude total revenues from intercompany sales
Cainas Cookies purchased a commercial oven on 1/1/14 for a total cost of 35,000. Estimated useful life is 6 years, with a salvage value of 5,000 at the end of that time. Cainas estimates that the equipment will be used for 12,000 baking hours. For the first year of operations, Cainas had 2,500 backing hours. For the second year Cainas had 1,700 hours. Compute the depreciation for YEAR 2. Group of answer choices
Answer:
Units of production = $4250
Straight line depreciation expense = $5,000
Double declining method = $7.777
Explanation:
The depreciation method to he used wasn't stated, so I calculated the depreciation expense using 3 depreciation methods
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
(35,000 - 5,000) / 6 = $5,000
The depreciation expense each year would be $5000
Depreciation expense using the double declining method = Depreciation factor x cost of the asset
Depreciation factor = 2 x (1/useful life)
2 / 6 = 0.3333
Deprecation expense in year 1 = 0.3333 x $35,000 = $11,666.67
Book value = $35,000 - $11,666.67 = $23,333.33
Depreciation expense in year 2 = $23,333.33 × 0.3333 = $7.777
Depreciation expense using units of production = ( hours used in year / total estimated hours of the machine) x (Cost of asset - Salvage value)
(1,700 / 12,000) x (35,000 - 5,000) = $4250
I hope my answer helps you
The Cainas Cookies' depreciation expense for year 2 is C. $4,250.
The correct choice of answer is not A. $7,292 , B. $6,250 , or D. $4,598.
Data and Calculations:
Cost of commercial oven = $35,000
Salvage value = $5,000
Depreciable amount = $30,000 ($35,000 - $5,000)
Estimated useful life = 12,000 baking hours
Depreciation rate per baking hour = $2.50 ($30,000/12,000)
Depreciation expense for Year 2 = $4,250 ($2.50 x 1,700)
Thus, the depreciation expense for year 2 is $4,250.
Learn more: brainly.com/question/17312012
Suppose the price elasticity of demand for a product is 0.5. If a supplier wants to increase revenue, what change should it make to price, if any?
Answer:
The correct answer is: Increase the price in order to increase revenue.
Explanation:
To begin with, the price elasticity of demand for a product is the concept known in the economics that refers to the variation that happens in the quantity demanded of a product when the price of it changes a bit. Moreover, when the price elasticity of demand is 0.5 the product is relatively inelastic and therefore that if the price increases the quantity demanded will basically stay the same more less and that is why if the price increases the product will no suffer changes in its quantity demanded and that will cause the supplier to earn a higher total revenue.
Helen worked for ABC Motors for 25 years. The president of ABC said to her: "In consideration of your past service for 25 years, I promise to give you a new car next week." However, he did not give the car. Is this promise legally enforceable
Answer:
No, legal consideration is absent
Explanation:
According to the given situation, the President of ABC company was promised to Helen to give a new car next week as Helen worked for 25 years. But the president did not give the car as he promised to the Helen.
In this case, there was a promise which was verbal, not in the way of legal consideration, which means there is no proof so that Helen can claim from the president.
Therefore the correct answer is No, legal consideration is absent
Structuring a Special-Order Problem Harrison Ford Company has been approached by a new customer with an offer to purchase 10,000 units of its model IJ5 at a price of $5 each. The new customer is geographically separated from the company's other customers, and existing sales would not be affected. Harrison normally produces 75,000 units of IJ5 per year but only plans to produce and sell 60,000 in the coming year. The normal sales price is $12 per unit. Unit cost information for the normal level of activity is as follows: Direct materials $1.75 Direct labor 2.50 Variable overhead 1.50 Fixed overhead 3.25 Total $9.00 Fixed overhead will not be affected by whether or not the special order is accepted.
Direct Materials $1.75
Direct Labor 2.50
Variable Overhead 1.50
Fixed Overhead 3.25
Total $9.00
Requried:
a. What are the relevant costs and benefits of the two alternatives (accept or reject the special order)?
b. By how much will operating income increase or decrease if the order is accepted?
Answer:
Effect on income= $7,500 increase
Explanation:
Giving the following information:
Special offer:
Units= 10,000
Price= $5
Production costs:
Direct Materials $1.75
Direct Labor 2.50
Variable Overhead 1.50
Because it is a special offer and there is unused capacity, we will not take into account the fixed costs.
Effect on income= number of units*unitary contribution margin
Effect on income= 10,000*(5 - 1.75 - 2.5 - 1.5)
Effect on income= $7,500 increase
The servicescape factor that takes into consideration how easy it is for customers to find what they want as they move through a facility is known as:
Answer:
Functionality
Explanation:
Booms and Bitner developed the servicescape model. A servicescape can be defined as the physical surroundings and entire ambience in which a service can take place or occur. Basically, the servicescape emphasizes the importance and impact of the physical surroundings in which services can occur or take place.
The purpose of the servicescape is to evaluate and analyze the environment in which a service is situated and allows both the seller and customer to interact, plus tangible resources which would facilitate business transactions performance and communications.
The servicescape factor that takes into consideration how easy it is for customers to find what they want as they move through a facility is known as functionality.