Business
Lovely Lotion Inc. produces three different lotions: hand, body, and foot. The lotions are produced jointly in a mixing process that costs a total of $250 per batch. At the split-off point, one batch produces 80, 40, and 25 bottles of hand, body, and foot lotion, respectively. After the split-off point, hand lotion is sold immediately for $2.50 per bottle. Body lotion is processed further at an additional cost of $0.25 per bottle and then sold for $5.75 per bottle. Foot lotion is processed further at an additional cost of $0.85 per bottle and then sold for $4.00 per bottle. Assume that body and foot lotion could be sold at the split-off point for $3.00 and $3.20 per bottle, respectively. 1. Using the market value at split-off method, allocate the joint costs of production to each product. 2. A lotion manufacturing company produces three types of lotions. After the split-off point the company continues to sell the body lotion and makes $0.25 profit per bottle. The foot lotion generates $0.05 loss per bottle. Which lotion should be continued after the split-off point? A. Hand lotion.B. Body lotion.C. Foot lotion.D. Body and foot lotion.3. Allocate the joint costs of production to each product using the net realizable value method.
The following selected transactions were completed by Air Systems Company during January of the current year. Air Systems Company uses the periodic inventory system.Jan. 2 Purchased $18,200 of merchandise on account, FOB shipping point, terms 2/15, n/30. 5 Paid freight of $190 on the January 2 purchase. 6 Returned $2,750 of the merchandise purchased on January 2. 13 Sold merchandise on account, $37,300, FOB destination, 1/10, n/30. The cost of goods sold was $22,400. 15 Paid freight of $215 for the merchandise sold on January 13. 17 Paid for the purchase of January 2 less the return and discount. 23 Received payment on account for the sale of January 13 less the discount.Journalize the entries to record the transactions of Air Systems Company.
Analyzing the effects of transactions on the accounting equation. On July 1, Alfred Herron established Herron Commercial Appraisal Services, a firm that provides expert commercial appraisals and represents clients in commercial appraisal hearings. Instructions: Analyze the following transactions. Record in equation form the changes that occur in assets, liabilities, and owner's equity.Transactions:The owner invested $200,000 in cash to begin the business. Paid $40,500 in cash for the purchase of equipment. Purchased additional equipment for $30,400 on credit. Paid $25,000 in cash to creditors. The owner made an additional investment of $50,000 in cash. Performed services for $19,500 in cash. Performed services for $15,600 on account. Paid $12,000 for rent expense. Received $11,000 in cash from credit clients. Paid $15,100 in cash for office supplies. The owner withdrew $24,000 in cash for personal expenses.Analyze: What is the ending balance of cash after all transactions have been recorded?
Use the information in the ledger accounts. Cash Nov. 1 144,000 Nov. 8 40,320 Nov. 25 14,400 Nov. 30 1,680 Land Nov. 8 84,000 Building Nov. 8 70,320 Office Equipment Nov. 15 3,840 Nov. 21 576 Vehicles Nov. 30 11,280 Notes Payable Nov. 25 14,400 Nov. 8 114,000 Nov. 30 9,600 Accounts Payable Nov. 21 576 Nov. 15 3,840 Capital Stock Nov. 1 144,000 Prepare a trial balance for Avenson Insurance Company dated November 30.