Answer:
1. A) Satisfying your day-to-day spending needs?
Statement Savings account
Bank statements will hep you keep track of the balance.
B) Making and holding funds for your car purchase?
NOW Account.
An account that earns interest yet allows the owner to write drafts against the money in the account. This would be good here as it will increase the funds you are saving for the car purchase.
C) Making and holding funds for your home purchase?
NOW Account.
NOW stands for Negotiable Order of Withdrawal account and would work here as well.
D) Making and holding funds for your retirement?
Certificate of Deposit.
These are offered by banks and earn a higher interest return. They however have to be locked up for a while without withdrawing so they are great for retirement saving.
2. Which of the following accounts is typically not insured?
A. Mutual Funds.Mutual funds are not financial deposits so will not be covered by the Federal Deposit Insurance Corporation (FDIC).
3. Which of the following practices would help you keep accurate records regarding the funds in your bank account?
A. Keep track of your balance online.B. Immediately record the date and amount of each transaction in your check register and calculate the new balance.4. You can avoid a service fee on an average-balance account if you:
B. Keep a certain average daily balance in the account through a specified timeThere is a natural progression from one statement to the next. The following boxes represent the four financial statements. The set of financial statements is prepared at the end of each accounting period to communicate information about the company’s operations during that period to its users. Use the selection lists to demonstrate your knowledge of the relationships between the statements. In the headings, you will need to select the appropriate statement name and time period.(Hint: Ask yourself if the statement covers a period of time or if it is a snapshot at a given point in time.) Then complete the blanks following the headings.)
Statement:
ABC Company This statement shows how profitable a company is. It is sometimes referred to as the profit and loss (P&L) statement.
This statement summarizes the_______ Which item from this financial statement appears on the next financial statement?
Answer:
Income Statement:
ABC Company This statement shows how profitable a company is. It is sometimes referred to as the profit and loss (P&L) statement.
This statement summarizes the_revenue and expenses______ .
Which item from this financial statement appears on the next financial statement?
Net Income
Explanation:
For instance, Company XYZ reports the Net Income (net profit) from the Income Statement to the Statement of Retained Earnings. This second financial statement shows the distribution of profits to Company XYZ's stockholders. From this second statement, the company takes an item known as the Retained Earnings to the next statement called the Balance Sheet (a snapshot of financial position). The last statement usually prepared as part of financial reporting is the Statement of Cash Flows, which classifies the financial (cash) activities of the business into three: Operating, Investing, and Financing activities. The Statement of Cash Flows shows the cash inflows and outflows during a period.
Verne Cova Company has the following balances in selected accounts on December 31, 2014.
Accounts Receivable $ -0-
Accumulated Depreciation—Equipment -0-
Equipment 7,000
Interest Payable -0-
Notes Payable 10,000
Prepaid Insurance 2,100
Salaries and Wages Payable -0-
Supplies 2,450
Unearned Service Revenue 30,000
All the accounts have normal balances. The information below has been gathered at December 31, 2014.
1. Verne Cova Company borrowed $10,000 by signing a 12%, one-year note on September 1, 2014.
2. A count of supplies on December 31, 2014, indicates that supplies of $900 are on hand.
3. Depreciation on the equipment for 2014 is $1,000.
4. Verne Cova Company paid $2,100 for 12 months of insurance coverage on June 1, 2014.
5. On December 1, 2014, Verne Cova collected $30,000 for consulting services to be performed from December 1, 2014, through March 31, 2015.
6. Verne Cova performed consulting services for a client in December 2014. The client will be billed $4,200.
7. Verne Cova Company pays its employees total salaries of $9,000 every Monday for the preceding 5-day week (Monday through Friday). On Monday, December 29, employees were paid for the week ending December 26. All employees worked the last 3 days of 2014.
Instructions:
Prepare adjusting entries for the seven items described above.
Answer and Explanation:
The adjusting journal entries are shown below:
1) Interest Expense $400 ($10,000 × 12% × 3 months ÷ 12 months)
Interest Payable $400
(Being interest expense is recorded)
2) Supplies expense $1,500 ($2,450 - $900)
To Supplies $1,550
(being supplies expense is recorded)
3) Depriciation expense $1,000
Accumulated depriciation - equipment $1,000
(being depreciation expense is recorded)
4) Insurance expense $1,225 ($2,100 × 7 months ÷ 12 months)
To Prepaid insurance $1,225
(Being insurance expense is recorded)
5) Unearned service revenue $7,500 ($30,000 ÷ 4)
Service revenue $7,500
(being service revenue is recorded)
6) Account receivable $4,200
To Service revenue $4,200
(being account receivable is recorded)
7) Salaries and wages expense $5,400 ($9,000 ÷ 5 days × 3 days)
To Salaries and wages payable $5,400
(being salaries & wages expense is recorded)
Indicate which activities of Stockton Corporation violated the rights of a stockholder who owned one share of common stock.
a. Paid the stockholder a smaller dividend per share than another common stockholder.
b. Did not allow the stockholder to make decisions regarding hiring and firing employees.
c. Rejected the stockholder's request to vote via proxy because she was home sick.
d. The company did not provide all stockholders with timely financial reports.
e. In liquidation, paid the common shareholder after preferred stockholders were already paid.
Answer:
a. Paid the stockholder a smaller dividend per share than another common stockholder.
c. Rejected the stockholder's request to vote via proxy because she was home sick.
d. The company did not provide all stockholders with timely financial reports.
Explanation:
A shareholder is a person that has contributed to the equity of a company and holds shares as evidence of ownership.
Shareholders have right to recieve equal dividend as other common shareholders. There can only be a difference in dividend payouts when the other person has more shares.
They also have the right to vote via proxy in cases where they are not available. The proxy is duly appointed by the shareholder.
The company is also mandated to provide timely financial reports to all stockholders.
Shareholders however are not involved in daily running of the business. So they have no say in hiring and firing of employees.
Also common shareholders are paid dividend after preference share holders have been settled by the company.
You are considering a project which will provide annual cash inflows of $4,921, $5,700, and $8,000 at the end of each year for the next three years, respectively. What is the present value of these cash flows, given a 9 percent discount rate?
Answer:
Total PV= $15,489.73
Explanation:
Giving the following information:
Cash flows:
1= $4,921
2= $5,700
3= $8,000
Interest rate= 9%
To calculate the present value, we need to use the following formula on each cash flow:
PV= FV/(1+i)^n
PV1= = 4,921/1.09= 4,514.68
PV2= 5,700/1.09^2= 4,797.58
PV3= 8,000/1.09^3= 6,177.47
Total PV= $15,489.73
f the present value of the annuity is $45,000, what should be the size of each payment from the annuity
Answer:
"$571.92" is the correct solution.
Explanation:
The given problem is incomplete. Please find attachment of the complete question.
The given values are:
Payments will be made for
= [tex]8\frac{1}{4} \ years[/tex]
At the rate of:
= [tex]5.75 \ percent[/tex]
= [tex]0.0575 \ per \ year[/tex]
The present value of annuity is:
= [tex]45000[/tex]
Let the size of each payment will be "d".
Now,
⇒ [tex]45000=\frac{1-(1+\frac{0.0575}{12})^{-99}}{\frac{0.0575}{12}}\times d[/tex]
⇒ [tex]d = 571.92[/tex] ($)
A company reports the following beginning Inventory and two purchases for the month of January. On January 26, the company sells 360 units. Ending Inventory at January 31 totals 130 units.
Units Unit Cost
Beginning inventory on January 1 320 $3.10
Purchase on January 9 70 3.30
Purchase on January 25 100 3.40
Required:
Assume the Perpetual Inventory system is used. Determine the costs assigned to ending Inventory when costs are assigned based on LIFO.
Answer:
$439
Explanation:
Perpetual Inventory method calculates the value of goods held after each transaction.
LIFO stands for First In First Out.
Calculation of cost assigned to ending Inventory - FIFO
30 units × $3.30 = $99
100 units × $3.40 = $340
Total = $439
Three categories of activities (operating, investing, and financing) generate or use the cash flow in a company. In the following , identify which type of activity is described by each statement. (Operating Activity Investing Activity Financing Activity)
a. Yum Co. uses cash to repurchase 10% of its common stock.
b. DigiInk Printing Co. buys new machinery to ramp up its production capacity.
c. D and W Co. sells its last season’s inventory to a discount store.
d. A company records a loss of $70,000 on the sale of its outdated inventory.
Answer:
a. Yum Co. uses cash to repurchase 10% of its common stock. (Financing activity)
b. DigiInk Printing Co. buys new machinery to ramp up its production capacity. (Investing activity)
c. D and W Co. sells its last season’s inventory to a discount store. (Operating activity)
d. A company records a loss of $70,000 on the sale of its outdated inventory. (Operating activity)
Explanation:
Cash flow statement shows how cash is used and obtained in a business. There are different activities that influence cash flow. Below are the activities:
- Operating activities are those that include normal business operations like buying and selling of inventory, interest payments, and salaries.
- Investing activities involves use of cash for investment like purchase or sale of assets, merger and acquisitions payments, and purchase of equipment.
- Financing activities includes cash used to purchase or sell equity such as shares, payment of dividends, and repayment of principal from debt
Share one or two specific examples of how you will use the concepts or strategies presented in this class to contribute to your academic and career success.
Answer:
Explanation:
e concepts or strategies presented in this class
Blossom Corp is issuing a 10-year bond with a coupon rate of 11 percent. The interest rate for similar bonds is currently 7 percent. Assuming annual payments, what is the value of the bond
Answer:
$1,280.94
Explanation:
FV= $1000
PMT = 11% * $1000 = $110
N = 10 Years
I/Y = 7%
Using Excel, Present value of bond ($1,000, $110, 10, 7%) = $1280.9433
Hence, the present value of bond = $1,280.94
On February 1, 2018, Wolf Inc. issued 10% bonds dated February 1, 2018, with a face amount of $270,000. The bonds sold for $323,440 and mature in 20 years. The effective interest rate for these bonds was 8%. Interest is paid semiannually on July 31 and January 31. Wolf's fiscal year is the calendar year. Wolf uses the effective interest method of amortization.
Required:
1. Prepare the journal entry to record the bond issuance on February 1, 2018.
2. Prepare the entry to record interest on July 31, 2018.
3. Prepare the necessary journal entry on December 31, 2018.
4. Prepare the necessary journal entry on January 31, 2019.
Answer:
Required 1
Cash $323,440 (debit)
Bonds Payable $323,440 (credit)
Required 2
Interest Expense $12,938 (debit)
Bond Payable $12,938 (credit)
Required 3
J1
Interest Expense $12,961 (debit)
Bond Payable $12,961 (credit)
Interest accrued on Bond
J2
Bond Payable $12,938 (debit)
Cash $12,938 (credit)
Interest Cash outflow
Required 4
J1
Interest Expense $12,961 (debit)
Bond Payable $12,961 (credit)
Interest accrued on Bond
J2
Bond Payable $12,938 (debit)
Cash $12,938 (credit)
Interest Cash outflow
Explanation:
First, determine the coupon payments as follows :
FV = ($270,000)
PV = $323,440
N = 20
P/yr = 1
I = 8%
PMT = ?
Using a Financial Calculator, the annual coupon payments will be $27,042 ($12,938 semi-annually).
July 31,2018
Effective Interest Calculation
Effective Interest = $323,440 × 8% × 1/2
= $12,938
Dodie Company completed its first year of operations on December 31. All of the year's entries have been recorded except for the following: At year-end, employees earned wages of $4,000, which will be paid on the next payroll date in January of next year. At year-end, the company had earned interest revenue of $1,500. The cash will be collected March 1 of the next year.
Required: 2. Prepare the required adjusting entry for transactions (a) and (b). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answer:
A. Dr Wages expense 4,000
Cr Wages payable 4,000
B. Dr Interest receivable 1,500
Cr Interest revenue 1,500
Explanation:
Preparation of Journal entries
A. Based on the information given we were told that the company employees earned wages of the amount of $4,000, which will be paid on in January of next year which means that the Journal entry will be:
Dr Wages expense 4,000
Cr Wages payable 4,000
B. Based on the information given we were told that the company had earned the amount of $1,500 as interest revenue which means that the Journal entry will be recorded as:
Dr Interest receivable 1,500
Cr Interest revenue 1,500
Use the following information to prepare a multistep income statement and a classified balance sheet for Eller Equipment Co. for Year 1.
Salaries expense $122,000 Beginning retained earnings $61,100
Common stock 110,000 Warranties payable (short term) 6,500
Notes receivable (short term) 32,500 Gain on sale of equipment 19,000
Allowance for doubtful accounts 19,000 Operating expenses 65,000
Accumulated depreciation 66,000 Cash flow from investing activities 116,000
Notes payable (long term) 160,000 Prepaid rent 38,000
Salvage value of building 21,000 Land 95,000
Interest payable (short term) 6,000 Cash 41,000
Uncollectible accounts expense 45,000 Inventory 101,000
Supplies 6,500 Accounts payable 55,000 Equipment 243,000
Interest expense 36,000 Interest revenue 6,200
Salaries payable 68,000 Sales revenue 940,000
Unearned revenue 47,000 Dividends 20,000
Cost of goods sold 595,000 Warranty expense 9,200
Accounts receivable 108,000 Interest receivable (short term) 3,600
Depreciation expense 3,000
Answer:
Eller Equipment Co.
Income statement
Particular Amount($) Amount ($)
Sales revenue 940,000
Less: Cost of good sold (595,000)
Gross margin 345,000
Operating expenses
Salaries expenses 122,000
Operating expenses 65,000
Warranty expenses 9,200
Un-collectible account expenses 45,000
Depreciation expenses 3,000
Total operating expenses (244,200)
Operating income 100,800
Non-operating expenses
Interest revenue 6,200
Interest expenses (36,000)
Gain on sale of equipment 19,000
Total non-operating items (10,800)
Net Income $90,000
Balance Sheet
Assets Amount$
Current Assets
Cash 41,000
Accounts receivable 108,000
Less: Allowance for doubtful (19,000) 89,000
accounts
Merchandise inventory 101,000
Interest receivable 3600
Prepaid rent 38,000
Supplies 6,500
Notes receivable 32,500
Total current assets 311,600
Property Plant and Equipment
Equipment 243,000
Less: Accumulated depreciation (66,000) 177,000
Land 95,000
Total property plant and equipment 272,000
Total Assets 583,600
Liabilities and Stockholder Equity
Current liabilities
Account payable 55,000
Unearned revenue 47,000
Warranties payable 6,500
Interest payable 6,000
Salaries payable 68,000
Total current liabilities 182,500
Long-term liabilities
Notes payable 160,000
Total long-term liabilities 160,000
Stockholders equity
Common stock 110,000
Retained earning 131,100
Total stockholders equity 241,100
Total liabilities and stockholders equity $583,600
Workings
Retained earning = Beginning retained earning + Net income - Dividend
= 61,100 + 90,000 - 20,000
= 131,100
A list of Year 3 revenues and expenses for Green Thumb, Inc. is provided below.
Advertising and Promotion Expenses $ 263,700
Income Tax Expense 56,620
Interest Expense 44,020
Other Expenses 123,600
Other Selling & Administrative Expenses 352,000
Sales Revenue 1,871,300
Salaries and Wages Expense 726,000
Required:
1. Calculate the net income for the Green Thumb, Inc. for Year 3.
2. Prepare a statement of retained earnings for Green Thumb, Inc. for Year 3. Assume the company had retained earnings of $163,200 as of January 1, Year 3, and paid out $46,120 in dividends during Year 3.
Answer:
a. Green Thumb
Net Income for the year 3
Particulars Amount
Sales revenue $1,871,300
Operating expenses
Advertising expense $263,700
Salaries and wages expense $726,000
Other selling expenses $352,000
Other expenses $123,600 $1,465,300
Earnings before interest and taxes $406,000
Interest expense $44,020
Earnings before taxes $361,980
Income tax expense $56,620
Net Income $305,360
b. Green Thumb Inc.
Statement of retained earnings
For the year ended Dec 31, Year 3
Retained Earnings, Jan 1 year 3 $163,200
Add: Net Income $305,360
Less: Dividend paid $46,120
Retained Earnings, Dec 31 year 3 $422,440
Cost of Production Report
The Cutting Department of Karachi Carpet Company provides the following data for January. Assume that all materials are added at the beginning of the process.
Work in process, January 1, 7,000 units, 70% completed $81,970
Direct materials (7,000 × $8.00) $56,000
Conversion (7,000 × 70% × $5.30) 25,970
$81,970
Materials added during January from Weaving
Department, 108,000 units $869,400
Direct labor for January 248,134
Factory overhead for January 303,274
Goods finished during January (includes goods in
process, January 1), 109,200 units —
Work in process, January 31, 5,800 units, 30% completed —
A. Prepare a cost of production report for the Cutting Department. If an amount is zero or a blank, enter in "0".
B. Compute and evaluate the change in the costs per equivalent unit for direct materials and conversion from the previous month (December).
Answer:
A) Summary of physical units and equivalent units
Units to be accounted for Physical units
Beginning WIP 7,000
Units started 108,000
Total units to be accounted for 115,000
Units accounted for Phys. units Materials Conversion
Beginning WIP 7,000 $56,000 $25,970
Units started 108,000 $869,400 $551,408
Subtotal 115,000 $925,400 $577,378
Units transferred out 109,200 $878,710 $567,691
Ending WIP 5,800 $46,690 $9,687
Summary of costs to be accounted for
Costs to be accounted for: Materials Conversion Total
Beginning WIP $56,000 $25,970 $81,970
Costs incurred in the period $869,400 $551,408 $1,420,808
Total costs to be accounted for $925,400 $577,378 $1,502,778
Calculation of cost per equivalent unit
Materials Conversion Total
Costs incurred in the period $869,400 $551,408 $1,420,808
Total equivalent units 108,000 99,040
Cost per equivalent unit $8.05 $5.567528 $13.617528
Cost allocation
Materials Conversion Total
Units finished and transferred $878,710 $567,691 $1,446,401
Ending WIP $46,690 $9,687 $56,377
Total costs to be accounted for $925,400 $577,378 $1,502,778
B) Materials cost per equivalent unit increased slightly during the period from $8 per EU to $8.05 per EU (0.6% increase). Conversion costs also increased during the period from $5.30 per EU to $5.567528 per EU (5% increase).
Explanation:
beginning WIP 7,000 units
100% completed for materials
70% completed for conversion costs (30% added in this period = 2,100 EU)
beginning WIP costs
materials $81,970
conversion $56,000
units started 108,000
materials added during the period $869,400
conversion costs $551,408
units finished 109,200
units started and finished = 108,000 - 7,000 - 5,800 = 95,200
ending WIP 5,800
100% complete for materials
30% complete for conversion costs (1,740 EU)
total EU:
materials 108,000
conversion 2,100 + 95,200 + 1,740 = 99,040
cost per EU:
materials $869,400 / 108,000 = $8.05
conversion $551,408 / 99,040 = $5.567528
total = $13.617528
ending WIP costs:
5,800 x $8.05 = $46,690
1,740 x $5.567528 = $9,687
total = $56,377
costs of finished units:
(102,200 x $8.05) + $56,000 = $878,710
(95,200 x $5.567528) + (2,100 x $5.567528) + $25,970 = $567,691
total = $1,446,401
The purchase of office equipment at a cost of $7,600 with an immediate payment of $4,200 and agreement to pay the balance within 60 days is recorded by the purchaser with:_____.
A. A debit of $7,600 to Office Equipment, a credit of $4,200 to Cash, and a credit of $3,400 to Accounts Payable.
B. A debit of $7,600 to Office Equipment, a debit of $4,200 to Accounts Receivable, and a credit of $3,400 to Accounts Payable.
C. A debit of $3,400 to Accounts Receivable, a debit of $4,200 to Cash, and a credit of $7,600 to Office Equipment.
D. A debit of $7,600 to Office Equipment, a credit of $4,200 to Cash, and a credit of $3,400 to Accounts Receivable.
Answer:
A. A debit of $7,600 to Office Equipment, a credit of $4,200 to Cash, and a credit of $3,400 to Accounts Payable.
Explanation:
Recognize the Asset - Office Equipment and Accounts Payable Accounts as these are increasing. De-recognize the Cash Account as this account is decreasing.
XYZ Company is union free. Because of increased costs and operational efficiency, it is in XYZ Company’s best interest to avoid unionization. While still in this non-unionized state, it is important for YYZ to do all EXCEPT which of the following?
Answer:
Make sure employees understand that anyone who attempts unionization will be discharged
Explanation:
Companies are not allowed to threaten employees who are interested in forming a union with discharge.
A (Static) Using T accounts to record all business transactions. LO 3-1, 3-2, 3-4
The following accounts and transactions are for Vincent Sutton, Landscape Consultant.
Transactions:
Sutton invested $90,000 in cash to start the business.
Paid $6,000 for the current month’s rent.
Bought office furniture for $10,580 in cash.
Performed services for $8,200 in cash.
Paid $1,250 for the monthly telephone bill.
Performed services for $14,000 on credit.
Purchased a computer and copier for $18,000; paid $7,200 in cash immediately with the balance due in 30 days.
Received $7,000 from credit clients.
Paid $2,800 in cash for office cleaning services for the month.
Purchased additional office chairs for $5,800; received credit terms of 30 days.
Purchased office equipment for $22,000 and paid half of this amount in cash immediately; the balance is due in 30 days.
Issued a check for $9,400 to pay salaries.
Performed services for $14,500 in cash.
Performed services for $16,000 on credit.
Collected $8,000 on accounts receivable from charge customers.
Issued a check for $2,900 in partial payment of the amount owed for office chairs.
Paid $725 to a duplicating company for photocopy work performed during the month.
Paid $1,280 for the monthly electric bill.
Sutton withdrew $5,500 in cash for personal expenses.
Post the above transactions into the appropriate T accounts.
Analyze:
What liabilities does the business have after all transactions have been recorded?
Complete this question by entering your answers in the tabs below.
Transactions
Analyze
Post the above transactions into the appropriate T accounts.
Cash Accounts Receivable
Bal.
Bal.
Office Furniture Office Equipment
Bal. Bal.
Accounts Payable Vincent Sutton, Capital
Bal.
Bal.
Vincent Sutton, Drawing Fees Income
Bal.
Bal.
Rent Expense Utilities Expense
Bal. Bal.
Salaries Expense Telephone Expense
Bal. Bal.
Miscellaneous Expense
Bal.
Complete this question by entering your answers in the tabs below.
What liabilities does the business have after all transactions have been recorded?
Liabilities
Answer:
It is very difficult to record T accounts since there is not a lot of room here and things get complicated very easily. So I used an excel spreadsheet to post the accounts on an accounting equation format.
Assets increase when they are debited and they decrease when they are credited. The opposite happens to liabilities and equity, they increase when they are credited and decrease when they are debited. Service revenue is credited, while all expenses are debited.
The reason why the drawings account has a negative balance is that even though it is an equity account, it has a debit balance since it decreases capital.
In order for the equation to balance, you have to close the accounts, but that was not a requirement of the question.
What liabilities does the business have after all transactions have been recorded?
the only liability account is accounts payable with a credit balance of $24,700
Which activities are often required of someone who is in the performing arts?
A. writing creatively, remembering a script, and entertaining people
B. going on auditions, using pottery wheels, and scheduling tasks
C. creating artwork, designing a dance routine, and interviewing people to get information
D. coordinating performances, attending events to market themselves, and operating technical equipment
Answer:
It's A: writing, a script, and entertaining people
Explanation:
did on edge 2020
Business standards should be based on which of the following?
Answer: standards are based on the ultimate goals of a business
Explanation:
Standards set specialized goalsExamples-Financial standards
* Set goals for profit, cash flow and sale
-Quality control standards
*Set up production line check for defects in machinery or workmanship
Fort Corporation had the following transactions during its first month of operations
1. Purchased raw materials on account, $85,000.
2. Raw Materials of $30,000 were requisitioned to the factory.
3. An analysis of the materials requisition slips indicated that $6,000 was classified as indirect materials labor costs incurred were $175,000 of which $145,000 pertained to factory wages payable and $30,000 pertained to employer payrol
4. Time tickets indicated that $145,000 was direct labor and $30,000 was indirect labor.
5. Overhead costs incurred on account were $198,000
6. Manufacturing overhead was applied at the rate of 150% of direct labor cost.
7. Goods costing $115,000 are still incomplete at the end of the month; the other goods were completed and transferred to finished goods
8. Finished goods costing $100,000 to manufacture were sold on account for $130,000.
Journalize the above transactions for Fort Corporation. (Record journal entries in the order presented in the problem.
Answer:
DR Raw materials inventory $85,000
CR Accounts payable $85,000
DR Work in process Inventory $24,000
Manufacturing overhead $6,000
CR Raw materials inventory $30,000
Working
Work in Process = 30,000 - 6,000 = 24,000
DR Factory Labor $175,000
CR Factory wages payable $145,000
Payroll taxes payable $30,000
DR Work in process Inventory $145,000
Manufacturing overhead $30,000
CR Factory Labor $175,000
DR Manufacturing overhead $198,000
CR Accounts payable $198,000
DR Work in process Inventory $217,500
CR Manufacturing overhead $217,500
Working
Work in Process Inventory = 145,000*150% = $217,500
DR Finished goods Inventory $271,500
CR Work in process Inventory $271,500
Working
Finished goods = 24,000 + 145,000 + 217,500 - 115,000 = $271,500
DR Cost of goods sold $100,000
CR Finished goods Inventory $100,000
DR Account receivables $130,000
CR Sales $130,000
Assume that in the short run a firm is producing 500 units of output, has average total costs of $300, and has average variable costs of $220. The firm's total fixed costs are. Select one: a. $40,000. b. $6.25. c. $0.16. d. $80.
Answer:
Total fixed costs= $40,000
Explanation:
First, we need to calculate the total variable cost and total cost:
Total cost= 500*300= $150,000
Total variable cost= 500*220= $110,000
Now, we can calculate the total fixed costs:
Total fixed costs= total cost - total variable cost
Total fixed costs= 150,000 - 110,000
Total fixed costs= $40,000
Hilary sells bottled water from a small stand by the beach. On the last day of summer vacation, many people are on the beach, and Hilary realizes that she can make a lot more money this day if she hires someone to walk up and down the beach selling water. She finds a college student named Edison and makes him the following offer: They'll each sell water all day and split their earnings (revenue minus the cost of water) equally at the end of the day. Hilary knows that if they both work hard, Edison will earn $90 on the beach and Hilary will earn $240 at her stand, so they will each take home half of their total revenue: If Edison shirks, he'll generate only $60 in earnings. Hilary does not know that Edison estimates his personal cost (or disutility) of working hard as opposed to shirking at $30. Once out of Hilary's sight, Edison faces a dilemma: work hard (put in full effort) or shirk (put in low effort).In terms of Edison's total utility, it is worse for him to ____(work hard or shirk). Taking into account the loss in utility that working hard brings to Edison, Hilary and Edison together ___ (are or are not) better off if Edison shirks instead of working hard.Hilary knows Edison will shirk if unsupervised. She considers hiring her good friend Carrie to keep an eye on Edison. The most Hilary should be willing to pay Carrie to supervise Edison, assuming supervision is sufficient to encourage Edison to work hard, is ____ .
a. 55.
b. 30.
c. 25.
d. 20.It turns out that Hilary's friend Carrue is unavilable that day, so Hilary cannot find a reliable person to watch Edison. Which of the following arrangements will ensure that Edison works hard without making Hilary any worse off than she is when Edison shirks?A. Pay Edison $20, regardless of how many bottles of water he sells.B. Allow Edison to keep 75% of the revenue from the bottles of water he sells instead of 50%.C. Allow Edison to keep 57% of the revenue from the bottles of water he sells instead of 50%.D. Make Edison promise to work hard.
Answer:
A)In terms of Edison's total utility, it is worse for him to shirk. Taking into account the loss in utility that working hard brings to Edison, Hilary and Edison together are better off if Edison shirks instead of working hard.
B) $20
C) Allow Edison to keep 57% of the revenue from the bottles of water he sells instead of 50% (c)
Explanation:
If Edison works hard he will earn = $90
If Harry work hard he will earn = $240
They will both take home : (90 + 240) / 2 = 330 /2 = $165 each
If Edison shirks he will earn = $60
therefore the total revenue = 60 + 240 = 300
They will both take home : 300 / 2 = $150 each
A)In terms of Edison's total utility, it is worse for him to shirk. Taking into account the loss in utility that working hard brings to Edison, Hilary and Edison together are not better off if Edison shirks instead of working hard.
B) The most Hilary should be willing to pay Carrie
should be : Amount earned without shirking - Amount earned with shirking
= $165 - $150 = $15 the closest answer in the option is $20
C) . Allow Edison to keep 57% of the revenue from the bottles of water he sells instead of 50%
Is cost minimization equivalent or identical the concept of product maximization. True of False. Explain
Answer:
True
Explanation:
Given a certain production level, cost minimization is equal to product maximization. Cost minimization refers to the production level where average total cost per unit is lowest. On the other hand, production maximization refers to maximizing product output given certain restraints, e.g. amount of raw materials, number of labor hours, etc. Product maximization basically refers to the efficiency of production.
If someone can achieve product maximization and cost minimization, they should be maximizing profit.
Following is information about consulting jobs for a company that is increasing in sales, but has not yet become profitable. The owner keeps financial records on yellow sticky notes stuck to the wall behind his desk. He has asked you to help him set up a costing system so that he can better understand his costs. The owner said that job 140 was completed, job 141 was started and completed, and job 142 was started this month. Professional labour hours for contracts in process consist of job 140 with 129 hours, job 141 with 258 hours, and job 142 with 137 hours. Professional labour was paid $23,580 for the month, and the professional employees are all paid the same rate per hour. Overhead is allocated using an estimated rate based on professional labour hours. The total cost for job 141 is $32,766. Actual overhead cost for the month was $53,448. What is labour paid per hour? Labour per hour. What is the estimated rate per labour hour used to allocate overhead? per hour. Overhead rate What are the total costs (before adjusting for overapplied or underapplied overhead) for Jobs 141, 142, and 143? Total cost Job 140 Job 141 Job 142 What are the amounts in cost of goods sold and work-in-process at the end of the month? Cost of goods sold Work-in-process What amount of overhead was overapplied or underapplied this month? Overhead If this month is typical, what is a reasonable overhead rate? Reasonable overhead rate per hour
Answer:
Part 1
$82 per professional labor hour
Part 2
Job 141 = $16,383 ,Job 142 = $32,766 , and Job 143 = $17,399
Part 3
Cost of Goods Sold = $49,149
Ending Work In Process Inventory = $17,399
Part 4
Overheads Under- applied = $10,480
Part 5
$102.00 per professional labor hour
Explanation:
Labor Cost per hour = Total Cost ÷ Total hours
= $23,580 ÷ ( 129 + 258 + 137)
= $45.00 per hour
We know that,
Overhead allocation rate = Estimated Overhead Costs ÷ Estimated Professional labor hours
But using Job 141 we can solve as,
Total for Job 141 = $32,766
Less Labor Cost (258 hours × $45.00) = $11,610
Overheads allocated to Job 141 = $21,156
Then,
Overhead allocation rate = $21,156 ÷ 258
= $82 per professional labor hour
Total Costs
Job 140 Job 141 Job 142
Direct Labor $5,805 $11,610 $6,165
Overheads $10,578 $21,156 $11,234
Total Cost $16,383 $32,766 $17,399
Cost of Goods Sold
Note : Only Finished Jobs are accounted in this figure
Total Cost of Job 140 $16,383
Total Cost of Job 141 $32,766
Cost of Goods Sold $49,149
Work In Process Inventory
Note : Only Incomplete Jobs are accounted in this figure
Total Cost of Job 142 $17,399
Application of Overheads
Actual Overheads (given) = $53,448
Applied Overheads ($82 × ( 129 + 258 + 137)) = $42,968
Actual Overheads > Applied Overheads therefore we have an Under-applied situation.
Overheads Under- applied = $10,480 ($53,448 - $42,968)
Reasonable Overhead Rate.
Rate that does not produce variances is reasonable !
Reasonable Overhead Rate. = Actual Overheads ÷ Total Professional Hours
= $53,448 ÷ 524 hours
= $102.00 per professional labor hour
Which idea forms the basis of double-entry accounting?
A. For every single transaction, at least two accounts will be
affected.
B. For every single transaction, only assets will be impacted.
C. The assets of a business equal the stockholders' equity.
O D. The stockholders' equity in a business must equal the liabilities.
Answer:
A. For every single transaction, at least two accounts will be
affected.
Explanation:
Double-entry accounting is a record-keeping method where a transaction is recorded in a minimum of two accounts. There is no upper ceiling on the actual number of accounts that may be used in a transaction.
Every account has two columns, with debits on the left and credit entries on the right. The aggregate of the debit entries must equal the result of all credit entries. If this happens, the transaction has balanced. If not, the transaction is "out of balance."
Brace Corporation uses direct labor-hours in its predetermined overhead rate. At the beginning of the year, the estimated direct labor-hours were 21,600 hours. At the end of the year, actual direct labor-hours for the year were 20,400 hours, the actual manufacturing overhead for the year was $506,920, and manufacturing overhead for the year was underapplied by $23,440. The estimated manufacturing overhead at the beginning of the year used in the predetermined overhead rate must have been:_________
A. $501,920
B. $531,445
C. $483,480
D. $511,920
Answer:
D. $511,920
Explanation:
For determining the estimated manufaturing overhead first determined the predetermined overhead which is shown below:
= (Actual manufacturing overhead - underapplied overhead) ÷ (actual direct labor hours)
= ($506,920 - $23,440) ÷ (20,400 hours)
= $23.7
Now the estimated manufacturing overhead is
= $23.7 × 21,600 hours
= $511,920
At the beginning of the current season on April 1, the ledger of Granite Hills Pro Shop showed Cash $ 3,360: inventory $ 3,500: and Common Stock $ 6,860. The following transactions were completed during April 2017.Apr. 5 Purchased golf bags, clubs, and balls on account from Arnie Co. $ 1,500, terms 3/10, n/60.7 Paid freight on Arnie purchase $ 80.9 Received credit from Arnie Co. for merchandise returned $700.10 Sold merchandise on account to members $1,420, terms n/30. The merchandise sold had a cost of $ 770.12 Purchased golf shoes, sweaters, and other accessories on account from Woods Sportswear $ 1,060, terms 2/10, n30.14 Paid Arnie Co. in full.17 Received a credit from Woods Sportswear for merchandise returned $60.20 Made sales on account to members $ 820, terms n/30. The cost of the merchandise sold was $550.21 Paid Woods Sportswear in full.27 Granted an allowance to members for clothing that did not fit properly $70.30 Received payments on account from members $1,370.1. Journalize the April transactions using a perpetual inventory system.2. Prepare an income statement through gross profit for the month of April 2017.
Answer:
Journal Entries
Date Account Titles & Explanation Debit Credit
Apr 5 Purchases $1,500
Accounts Payable $1,500
Apr 7 Freight-in $80
Cash $80
Apr 9 Accounts Payable $700
Purchase Returns and Allowances $700
Apr 10 Accounts receivable $1,420
Sales $1,420
Apr 10 Cost of goods sold $770
Inventory $770
Apr 12 Purchases $1,060
Accounts Payable $1,060
Apr 14 Accounts Payable $800
($1500-$700 )
Purchase Discounts $24
($800 * 3%)
Cash $776
Apr 17 Accounts Payable $60
Purchase Returns and Allowances $60
Apr 20 Accounts receivable $820
Sales $820
(To record credit sales)
Apr 20 Cost of goods sold $550
Inventory $550
Apr 21 Accounts Payable (1060-60) $1,000
Purchase Discounts $20
($1000 * 2%)
Cash $980
Apr 27 Sales Returns and Allowances $70
Accounts Receivable $70
Apr 30 Cash $1,370
Accounts Receivable $1,370
List and describe the three types of income. Include information regarding how each one is taxed.
Answer:
Understanding The Three Types Of Income
Earned Income. The first type of income is the most common: earned income. ... Capital Gains Income. The next type of income that you can earn is called capital gains income. ... Passive Income. The final type of income that you can earn is called passive income.
Answer:
earned income, capital income, dont know the last one sorry
Explanation:
Consider the following information for stocks A, B, and C. The returns on the three stocks are positively correlated, but they are not perfectly correlated. (That is, each of the correlation coefficients is between 0 and 1.)
Stock Expected Return Standard Deviation Beta
A 8.60% 14% 0.8
B 9.95 14 1.1
C 11.75 14 1.5
Fund P has one-third of its funds invested in each of the three stocks. The risk-free rate is 5%, and the market is in equilibrium. (That is, required returns equal expected returns.)
Required:
a. What is the market risk premium?
b. What is the beta of Fund P?
c. What is the required return of Fund P?
d. Would you expect the standard deviation of Fund P to be less than 15%, equal to 15% or greater than 15%? Explain.
Question attached
Answer and Explanation:
Find attached
What is a premium in personal finance HEEEEELLPPP
Premium has multiple meanings in finance, with the first being the total cost to buy an option. A premium is also the difference between the price paid for a fixed-income security and the security's face amount at issue.
Source: Investopedia