Trade and cash discounts; the gross method and the net method compared [LO7-3].Tracy Company, a manufacturer of air conditioners, sold 200 units to Thomas Company on November 17, 2016. The units have a list price of $550 each, but Thomas was given a 25% trade discount. The terms of the sale were 2/10, n/30. Required: 1. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on November 26, 2016, assuming that the gross method of accounting for cash discounts is used. Transaction listA. Record the sale of 200 units with a list price of $550, a 25% trade discount (if applicable), with terms of 2/10, n/30 under the gross method. B. Record the cash collection on November 26.2. Prepare the journal entries to record the sale on November 17 (ignore cost of goods) and collection on December 26, 2016, assuming that the gross method of accounting for cash discounts is used.
Answers
Answer and Explanation:
The Journal entries are shown below:-
1. Within discount period
Nov 17
Accounts receivable Dr, $82,500
To Sales revenue $82,500 (200 × $550 × 75%)
(Being sales revenue is recorded)
Nov 26
Cash Dr, $80,850
Sales discount Dr, $1,650 ($82,500 × 2%)
To Accounts receivable $82,500
(Being cash collection is recorded)
2. Beyond discount period
Nov 17
Accounts receivable Dr, $82,500
To Sales revenue $82,500 (200 × $550 × 75%)
(Being sales revenue is recorded)
Dec 15
Cash Dr, $82,500
To accounts receivable $82,500
(Being cash collection is recorded)
![Trade And Cash Discounts; The Gross Method And The Net Method Compared [LO7-3].Tracy Company, A Manufacturer](https://brainimage.s3.us-east-005.backblazeb2.com/answers/attachments/EkH9v9x2y953PvP7m3AGGQpwIsGpfEHw.png)
Related Questions
A company delivered $10,000 of goods to a customer that agreed to pay cash within 30 days. The goods had cost $8,000 to manufacture. Which of the following items would be increased by this sales transaction?A) Total Assets.B) Accounts Receivable.C) Total Liabilities.D) Inventory.E) Revenue.
Answers
Answer:
A) Total Assets
B) Accounts Receivable
E) Revenue.
Explanation:
Accounts Receivable are being increased because the customer took the goods on credit and agreed to pay in 30 days.
Accounts Receivable is an asset so the total asset will increase. Even though inventory decreases, the amount that the good was sold for exceeds inventory cost so the net benefit will increase assets.
Revenue is earned when a good is sold. $10,000 worth of goods were sold so that would be $10,000 in revenue.
Revenues generated by a new fad product are forecast as follows:Year Revenues1 $54,000 2 30,000 3 20,000 4 10,000 Thereafter 0 Expenses are expected to be 50% of revenues, and working capital required in each year is expected to be 10% of revenues in the following year. The product requires an immediate investment of $50,000 in plant and equipment.a. What is the initial investment in the product? Remember working capital.Initial investment $ b. If the plant and equipment are depreciated over 4 years to a salvage value of zero using straight-line depreciation, and the firm’s tax rate is 30%, what are the project cash flows in each year? Assume the plant and equipment are worthless at the end of 4 years. (Do not round intermediate calculations.)Year Cash Flow1 $ 2 3 4 c. If the opportunity cost of capital is 12%, what is the project's NPV? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.)NPV $ d. What is project IRR? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)IRR %rev: 09_24_2015_QC_CS-26391, 02_03_2015_QC_C
Answers
Answer:
a. What is the initial investment in the product?
$55,400b. If the plant and equipment are depreciated over 4 years to a salvage value of zero using straight-line depreciation, and the firm’s tax rate is 30%, what are the project cash flows in each year?
NCF₁ = $25,050NCF₂ = $15,250NCF₃ = $11,750NCF₄ = $8,250c. If the opportunity cost of capital is 12%, what is the project's NPV?
-$7,270.28d. What is project IRR?
4.27%Explanation:
year cash flows costs working capital
0 -$50,000 -$5,400
1 $54,000 -$27,000 $3,000 (+$2,400)
2 $30,000 -$15,000 $2,000 ($1,000)
3 $20,000 -$10,000 $1,000 (+$1,000)
4 $10,000 -$5,000 $0 (+$1,000)
net cash flow year 1 = [($54,000 - $27,000 - $12,500) x 0.7] + $12,500 + $2,400 = $25,050
net cash flow year 2 = [($30,000 - $15,000 - $12,500) x 0.7] + $12,500 + $1,000 = $15,250
net cash flow year 3 = [($20,000 - $10,000 - $12,500) x 0.7] + $12,500 + $1,000 = $11,750
net cash flow year 4 = [($10,000 - $5,000 - $12,500) x 0.7] + $12,500 + $1,000 = $8,250
I calculated the NPV and IRR using a financial calculator
Aladdin Carpet Care had the following total assets, liabilities, and equity as of October 31: (Click the icon to view the data.) What is Aladdin Carpet Care's debt ratio as of October 31? - Debt Ratio 1 Data Table Assets Liabilities Equity $ 200,000 30,000 170,000 Print Done
Answers
Answer:
0.15 or 15%
Explanation:
Total debt ratio is the ratio of total debt to total asset
Total debt ratio = total liability / total asset = 30,000 / 200,000 = 0.15 or 15%
Cute Camel Woodcraft Company's income statement reports data for its 1st year of operation. The Firm's CEO would like sales to increase by 25% next year. Cute Camel is able to achieve this level of increased sales, but its interest costs increase from 10% to 15% of earnings before interest & taxes (EBIT). The company's operating costs (excluding depreciation & amortization) remain at 65% of net sales, & its depreciation & amortization expenses remain constant from year to year. The company's tax rate remains constant at 40% of its pre-tax income or earnings before taxes (EBT). In year 2, Cute Camel expects to pay $300,000 & $1,824,525 of preferred & common stock dividends, respectively.Complete the Year 2 income statement data & then answer the questions that follow. Year 1 Year 2 (Forecasted)Net Sales $20,000,000 Less: operating costs, except 13,000,000depreciation & amortization Less: depreciation & amortization expenses 800,000 800,000Operating Income (EBIT) $6,200,000 Less: interest expense 620,000 Pre-Tax Income (EBT) 5,580,000 Less: taxes (40%) 2,232,000 Earnings after taxes $3,348,000 Less: preferred stock dividends 300,000 Earnings available to common shareholders 3,048,000 Less: common stock dividends 1,506,600 Contribution to Retained Earnings $1,541,400 $1,929,975Given the results of the previous income statement calculations, complete the following statements:A. In year 2, if cute camel has 25,000 shares of preferred stock issued & outstanding, then each preferred share should expect to receive ($12, $30, $18 or $24) in annual dividends.B. If cute camel has 200,000 shares of common stock issued & outstanding, then the firm's earnings per share (EPS) is expected to change from ($31, $16.74, $27.90 or $15.24) in year 1 to ($33.79, $39.75, $18.77 or $20.27) in year 2.
Answers
Complete Question
The complete question is shown on the first image
Answer:
The prepared income statement and the calculation is shown on the second , third and fourth uploaded image
A
the amount of preference dividend per share is [tex]Z = \$ 12[/tex]
B
The solution and the calculation is shown fifth uploaded image
Explanation:
Generally the amount of preference dividend per share is mathematically represented as
[tex]Z = \frac{ Amount \ of \ preferred dividend \ paid\ _{2nd year } }{ Number \ of \ preferred \ share }[/tex]
=> [tex]Z = \frac{300000}{25000}[/tex]
=> [tex]Z = \$ 12[/tex]
At the end of the current period, Maltese, Inc. reports the following amounts: Assets = $54,200; Liabilities = $26,300; Dividends = $2,700; Revenues = $18,500; Expenses = $13,400.
Calculate net income and stockholders' equity at the end of the period.
Answers
Answer:
Net income =$5,100
Shareholders equity=$27,900
Explanation:
Calculate net income and stockholders' equity at the end of the period.
Explanation:
Calculation for the net income and stockholders' equity at the end of the period
Calculation for NET INCOME using this formula
Net income=Revenues- Expenses
Let plug in the formula
Net income=$18,500-$13,400
Net income =$5,100
Therefore Net income amount will be $5,10
Calculation for SHAREHOLDER'S EQUITY using this formula
Shareholdersl's equity=Assets- Liabilities
Let plug in the formula
Shareholders equity=$54,200 -$26,300
Shareholders equity=$27,900
Therefore Shareholders equity will be $27,900
Complete the Analysis section using formulas with statistical functions. Use named ranges instead of cell references in the formulas. Calculate the average, highest, and lowest values for each of the following:a. Price b. MPG City c. MPG Highway d. Average MPG e. Maintenance/Year f. Registration Fee g. Insurance /Year h. Amount to Borrow i. APR j. Years k. Loan Payment l. Gas m. Maintenance/Month n. Insurance/Month o. Total Monthly
Answers
Answer:
The formula for average is =AVERAGE(E15,E16).
The formula for highest is =MAX(F15,F16).
The formula for lowest is =MIN(G15,G16).
Explanation:
In MS Excel, on the left hand side below the tool bar there is a small box which tells the cell name where the cursor is clicked, the name of the cell can be changed from here easily, click on the desired cell and then by clicking on the box you can enter the name of the cell. After a cell is renamed the formula can be written by simply putting the name of the cell instead of the original e.g. E13
The formula for average is =AVERAGE(E15,E16).
The formula for highest is =MAX(F15,F16).
The formula for lowest is =MIN(G15,G16).
The cells provided in the formula above is just an example and more than two cells can be selected.
The rivalry among competing sellers tends to be less intense when: Select one: a. Industry conditions tempt competitors to use price cuts or other competitive weapons to boost sales b. Industry rivals are not particularly aggressive in drawing sales and market share away from rivals c. Both of the above d. None of the above
Answers
Answer:
The correct answer is the option B: Industry rivals are not particularly aggressive in drawing sales and market share aways from rivals.
Explanation:
To begin with, when it comes to rivalry among sellers of a same industry the competition will be less intense when they tend to be not particularly aggressive in terms of achieving every sale or getting more portions of the market so that they could be the only ones. Therefore that if this type of competitors exist, the ones that are not aggressive, there is not a lot of rivalry in the industry where they sell. Moreover, that will determine that the product sometimes might be quite similar or not so distinctive due to the fact that they do not fight with each other.
Suppose you are committed to owning a $220,000 Ferrari. If you believe your mutual fund can achieve an annual return of 10.85 percent, and you want to buy the car in 8 years on the day you turn 30, how much must you invest today
Answers
Answer:
2,291,520
Explanation:
220,000×10.85%=23,870
23,870×96=2,291,520
Pharoah Chemicals management identified the following cash flows as significant in its year-end meeting with analysts: During the year Pharoah had repaid existing debt of $315,900 and raised additional debt capital of $645,000. It also repurchased stock in the open market for a total of $44,820. What is the net cash provided by financing activities? (If an amount reduces the cash flow then enter with negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Answers
Answer:
Net cash provided by financing activities = $284,280
Explanation:
Net cash provided by financing activities = Additional debt - Repayment of existing debt - stock repurchase
Net cash provided by financing activities = $645,000 - $315,900 - $44,820
Net cash provided by financing activities = $284,280
Should underperforming restaurants be closed or sold?
Answers
Answer:
sold
Explanation:
Underperforming restaurants are those restaurants which does not perform well. The restaurant does not run properly and no people or less people visits the restaurant for eating.
This can be due to several factors. The restaurant's location may not be good, the restaurant may not provide good quality and tasty food, or people might not find their required menu in that restaurant. All these factors leads to less people visiting the restaurant and less revenue generation.
In such a case, the owner of the restaurant must sell the restaurant to some other party so that he does not undergo any losses. By selling the property he will get some amount of his investment which he could utilize in his further projects.
Also by selling the restaurant, the employees of that restaurant will not go out of job and can feed their family.
So, the restaurant should be sold.
Accounting has its own vocabulary and basic relationships. Match the accounting terms with the corresponding definition or meaning. ____ 1. Debit ____ 2. Expense____ 3. Net income____ 4. Ledger____ 5. Posting____ 6. Normal balance____ 7. Payable____ 8. Journal ____ 9. Receivable____ 10. Owners’ equitya. Always an asset b. Side of an account where increases are recorded c. Record of transactions d. The cost of operating a business; a decrease in stockholder’s equity e. Grouping of accounts f. Copying data from the journal to the ledger g. Revenues – Expenses h. Always a liability i. Left side of an account j. Assets – Liabilities
Answers
Answer and Explanation:
The matching of the accounting term with the definition is shown below:
1. Debit - it comes in the left side i.e. (i)
2. Expense: It decreases the stockholder equity also it contains the debit balance i.e. (d)
3. Net income: It is a statement that shows the expenses and revenue related transactions i.e. (g)
4. Ledger: It is the T-account in which the journal entries are posted i.e. (e)
5. Posting: The data is copied from journal to ledger we called as posting i.e. (f)
6. Normal balance: It is the side of an account in which the account increment is recorded i.e. (b)
7. Payable: It is a liability and it always a credit balance and shown in the balance sheet i.e (h)
8. Journal: In this the transactions are recorded i.e. (c)
9. Receivable: This is an asset and it has always a debit balance i.e. (a)
10. Owner equity: It is amount i.e. to be invested in the business also shows a difference between the total asset and total liabilities i.e. (j)
The idea that individuals and organizations are accountable to a larger society is known as:_________
Answers
Answer:
social responsibility
Explanation:
Social responsibility is the contribution of individuals and organizations to their immediate environment towards its development. The contribution is voluntary hence could be in form of providing scholarships to the children of host community, provision of healthcare facilities etc. Corporate social responsibility is also a sense of responsibility towards the community where an organization is situated.
Most organizations have now beginning to include corporate social responsibility into their values because such would make them seem attentive to the problems faced by their host community and it is a way of giving back to them for allowing the establishment of company in their locality.
The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough customer demand to justify producing its full capacity of 3,800 sets per year. Annual cost data at full capacity follow:Direct labor $89,000Advertising $101,000Factory supervision $66,000Property taxes, factory building $20,000Sales commissions $63,000Insurance, factory $7,000Depreciation, administrative office equipment $3,000Lease cost, factory equipment $15,000Indirect materials, factory $20,000Depreciation, factory building $108,000Administrative office supplies (billing) $5,000Administrative office salaries $111,000Direct materials used (wood, bolts, etc.)$425,000Utilities, factory $40,0001. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.)2. Compute the average product cost of one patio set.3. Assume that production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or remain unchanged?
Answers
Answer:
1.COST BEHAVIOUR
Variable Fixed
$642,000 $323,000
SELLING OR ADMINISTRATIVE
Cost $283,000
PRODUCT COST
Direct Indirect
$513,000 $276,000
2.$208
3. I would expect the average product cost per set to increase.
Explanation:
1. Calculation for the dollar amount of each cost item
COST BEHAVIOUR
Variable Fixed
Direct labor $89,000 $0
Advertising $0 $101,000
Factory supervision $0 $66,000
Property taxes, factory building$0 $20,000
Sales commissions$63,000 $0
Insurance, factory $0 $7,000
Depreciation, administrative office equipment$0 $3,000
Lease cost, factory equipment$0 $15,000
Indirect materials, factory $20,000 $0
Depreciation, factory building
Administrative office supplies (billing) $5,000 $0
Administrative office salaries $0 $111,000
Direct materials used (wood, bolts, etc.)$425,000 $0
Utilities, factory $40,000 $0
TOTAL COSTS $642,000 $323,000
SELLING OR ADMINISTRATIVE
Cost
Direct labor
Advertising $101,000
Factory supervision
Property taxes, factory building
Sales commissions $63,000
Insurance, factory
Depreciation, administrative office equipment $3,000
Lease cost, factory equipment
Indirect materials, factory
Depreciation, factory building
Administrative office supplies (billing) $5,000
Administrative office salaries$111,000
Direct materials used (wood, bolts, etc.)
Utilities, factory
TOTAL COSTS $283,000
PRODUCT COST
Direct Indirect
Direct labor $89,000 $0
Advertising
Factory supervision $0 $66,000
Property taxes, factory building$0 $20,000
Sales commissions
Insurance, factory $0 $7,000
Depreciation, administrative office equipment
Lease cost, factory equipment$0 $15,000
Indirect materials, factory$0 $20,000
Depreciation, factory building $0 $108,000
Administrative office supplies (billing)
Administrative office salaries
Direct materials used (wood, bolts, etc.)$425,000 $0
Utilities, factory$0 $40,000
TOTAL COSTS $514,000 $276,000
2.Computation of the average product cost of one patio set
Using this formula
Average product cost of one patio set =(Direct costs +Indirect costs)/Capacity set per year
Let plug in the formula
Average product cost of one patio set=($514,000+$276,000)/$3,800
Average product cost of one patio set=$790,000/$3,800
Average product cost of one patio set=$208
Therefore the Average product cost of one patio set will be $208
3. In a situation where the production drops to only 1,000 sets annually, I would expect the average product cost per set to increase.
1. The dollar amount of each cost item is entered under the appropriate headings as follows:
Fixed Variable Selling & Product
Costs Costs Admin Cost Cost
Direct labor $89,000 $89,000
Advertising $101,000 $101,000
Factory supervision $66,000 $66,000
Property taxes, factory building $20,000 $20,000
Sales commissions $63,000 $63,000
Insurance, factory $7,000 $7,000
Depreciation, administrative
office equipment $3,000 $3,000
Lease cost, factory equipment $15,000 $15,000
Indirect materials, factory $20,000 $20,000
Depreciation, factory building $108,000 $108,000
Administrative office supplies (billing) $5,000 $5,000
Administrative office salaries $111,000 $111,000
Direct materials used (wood, bolts, etc.)$425,000 $425,000
Utilities, factory $40,000 $40,000
Total costs $471,000 $602,000 $283,000 $790,000
2. The average product cost per set is $207.89 ($790,000/3,800).
3. If the Dorilane Company's production level drops to 1,000 sets annually, the average product cost per set will increase.
Thus, if the production level reduces to 1,000 sets annually, the average product cost will not decrease or remain unchanged, but will increase to $790.
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The owner of a bicycle repair shop forecasts revenues of $240,000 a year. Variable costs will be $70,000, and rental costs for the shop are $50,000 a year. Depreciation on the repair tools will be $30,000.Required:a. Calculate operating cash flow for the year by using all three methods: 1. Adjusted accounting profits2. Cash inflow/cash outflow analysis3. The depreciation tax shield approach.b. Are the above answers equal?
Answers
Answer:
1. Adjusted Accounting Profits
- This method gives cashflow by adjusting revenue for expenses.
Earnings before tax
= Revenue - variable cost - rent cost - depreciation
= 240,000 - 70,000 - 50,000 - 30,000
= $90,000
Earnings After tax
= 90,000 ( 1 - tax rate)
= 90,000 ( 1 - 30%)
= $63,000
Add back depreciation as it is a non-cash expense
Operating cashflow = 63,000 + 30,000
= $93,000
2. Cash inflow/cash outflow analysis
Cash outflow is removed from inflow.
= Cash inflow - outflow
= 240,000 - variable cost - rent cost - tax
= 240,000 - 70,000 - 50,000 - 27,000
= $93,000
Tax = Earnings before tax * 30%
= 90,000 * 30%
= $27,000
3. The depreciation tax shield approach.
The tax shield that depreciation affords is added to the earnings after tax.
= Revenue - variable cost - rent cost
= 240,000 - 70,000 - 50,000
= $120,000
After tax = 120,000 * ( 1 - 30%)
= $84,000
Depreciation tax shield = depreciation * tax
= 30,000 * 30%
= $9,000
Cashflow = 84,000 + 9,000
= $93,000
4. Are the above answers equal?
Yes they are. All give an operating cash-flow of $93,000.
What are the two major problems that affirmative action programs have faced?
Answers
Answer: quotas and lack of acceptance by some business people
Explanation:
Affirmative action programs are the programs that have been put in place to preventing discrimination that are based on color, sex, race, and national origins.
The programs focus on access to employment, education and also granting of special consideration to the racial minorities and historically excluded groups.
The two major problems that affirmative action programs have faced are quotas and lack of acceptance by some business people.
Quotas and resistance from some corporate leaders have been issues that affirmative action programmes have had to deal with.
Programmes known as affirmative action are those that have been put in place to stop prejudice based on national origins, sex, race, and colour.
The programmes put a lot of emphasis on providing racial minorities and other historically marginalized groups with access to work, education, and other opportunities.
Quotas and resistance from some corporate leaders have been the two main issues that affirmative action programmes have had to deal with.
Learn more about affirmative action programs here:
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How are goods produced? Determines:a) who receives the goods that are produced. b) how tastes and preferences are determined. c) how resources are combined in the production of goods. d) the types and quantities of goods and services produced.
Answers
Answer:
c) how resources are combined in the production of goods.
Explanation:
In order to meet the unending needs and wants of consumers, to satisfactorily provide products that meets their requirements, tastes or preferences various manufacturing companies use five (5) main methods of production, and these are; labour-intensive production, mass production, batch production, capital-intensive production and job production.
Generally in Economics, the question of how goods are produced, determines how resources are combined in the production of goods.
This ultimately implies that, before a manufacturer produce its goods it determines the amount of resources that are available. These resources that are to be combined for the purpose of production of goods are entrepreneur, land, labor, and capital, which are generally referred to as the four (4) factors of production.
Residual Claims Haung. Inc; is obligated to pay its creditors $10,700 very soon.1. What is the market value of the shareholders equity if assets have a market value of 9900?2. What if assets equal $9,990?
Answers
Answer and Explanation:
The computation of the shareholder equity for each case is shown below:
a. For case one
As we know that
Total assets = Total liabilities + stockholder equity
$9,900 = $10,700 + stockholder equity
So, the stockholder equity is
= $10,700 - $9,900
= $800
b. For case two
Total assets = Total liabilities + stockholder equity
$9,990 = $10,700 + stockholder equity
So, the stockholder equity is
= $10,700 - $9,990
= $710
When having to have a difficult conversation with upper managers, you can increase success by:__________a) Framing the issue in familiar language.b) Not asking for further budget allocation.c) Making sure you have just met your last deadline.d) Framing the issue in familiar language and making sure you have just met your last deadline.
Answers
Answer:
a) Framing the issue in familiar language
Explanation:
Since in the question it is mentioned that there is a difficult conversation with upper level manager so here the success could be increased by framing the issue so that the issue could be determined in a language that is familiar so that the issue could be resolved immediately by taking the proper actions in order to complete the task before time or within the time
Hence, the correct option is a.
What is the Veteran Administration’s primary role in the mortgage market?
A) To insure loans made by approved lenders.
B) To guarantee loans made by lenders.
C) To lend money directly to borrowers.
D) To buy loans from other secondary mortgage marketers.
Answers
Answer: To guarantee loans made by lenders
Explanation:
The primary mortgage market is simply the market where a mortgage loan can be gotten by the borrowers from a primary lender while the secondary mortgage market is simply a marketplace where the home loans are purchased and sold between the lenders and the investors.
The Veteran Administration’s primary role in the mortgage market is guarantee loans made by lenders.
According to Hofstede's Five Dimensions, ______ is the opposite of individualism.
A) wa.
B) groupism.
C) collectivism.
D) goal orientation.
Answers
Answer:
C) collectivism.
Explanation:
The Hofstede's Five Dimensions are:
Power Distance (PDI) Individualism versus Collectivism (IDV) Masculinity versus Femininity (MAS) Uncertainty Avoidance (UAI) Long-Term Orientation (LTO)Remember, collectivism refers to a principle of giving preference to a group (collectively) rather than to individual members of the group. However, unlike collectivism, individualism prioritizes an individual over a collective group.
What is the best study group?
Answers
Answer:
Study group are the institutions which provide students with the lectures and note. They help students for preparing assignments and hep them with their presentations. There can also be various study groups which help students with thesis writing.
Explanation:
The main purpose of study groups is to bring all the intellectual at one platform. There are multi talented youth who has different skills. These students are united at one platform and their intellectual is exchanged and enhanced by healthy discussions.
Swifty Fabricators produces protective covers for smart phones. Since the covers must be customized to each smart phone model, Swifty uses a job order costing system. On September 1, the company reported the following inventory balances:
Direct Materials $31,500
Work in Process $152,000
Finished Goods $260,000
During September, the following events occurred:
1. Swifty purchased direct materials costing $3,708,000 on account.
2. Swifty used $432,000 in direct materials in production.
3. Swifty’s employees clocked 22,000 direct labor hours at an average wage rate of $13.23 per direct labor hour.
4. The company incurred $182,000 in manufacturing overhead, including $18,000 in indirect labor costs.
5. Using direct labor hours as the application base, the company applied $166,000 of manufacturing overhead to jobs worked on in September.
6. The company completed production on jobs costing $858,000.
7. The company delivered jobs costing $1,078,000 to customers.
1. Calculate the ending September balance of the Direct Materials, Work in Process, and Finished Goods Inventory accounts.
2. Calculate total manufacturing costs for September.
Answers
Answer:
Required 1 Balances :
Direct Materials = $432,000
Work in Process = $183,060
Finished Goods = $40,000
Required 2 total manufacturing costs for September :
Total manufacturing costs = $905,060
Explanation:
Ending September balance of the Direct Materials,
Raw Materials T - Account
Debit :
Opening Balance $31,500
Purchases $3,708,000
Totals $3,739,500
Credit :
Ending Balance $3,307,500
Work In Process $432,000
Totals $3,739,500
Ending September balance of Work in Process,
Work in Process T - Account
Debit :
Opening Balance $152,000
Raw Materials $432,000
Labor Cost $291,060
Overheads Applied $166,000
Totals $1,041,060
Credit :
Ending Balance $183,060
Transfer to Finished Goods $858,000
Totals $1,041,060
Ending September balance Finished Goods .
Finished Goods T - Account
Debit :
Opening Balance $260,000
Transfer from Work In Process $858,000
Totals $1,118,000
Credit :
Ending Balance $40,000
Trading Account $1,078,000
Totals $1,118,000
Calculation of Total Manufacturing Cost
Raw Materials $432,000
Labor Cost $291,060
Overheads Incurred $182,000
Total Manufacturing Cost $905,060
How are creditor and investor claims reported on a balance sheet?
A) The claims of creditors are liabilities and those of investors are assets.
B) The claims of both creditors and investors are liabilities, but only the claims of investors are considered to be long-term.
C)The claims of creditors are reported as liabilities while the claims of investors are recorded as stockholders' equity.
D)The claims of creditors and investors are considered to be essentially equivalent.
Answers
Answer:
C)The claims of creditors are reported as liabilities while the claims of investors are recorded as stockholders' equity.
Explanation:
In a businesses balance sheet, Creditors claims are shown as liabilities. Liabilities show the amount of financing that creditors provided which could be in the form of debts or obligation. Debtors owe creditors an obligation, and this obligation is to pay back. Investors claim are recorded as stockholders equity
a. The owner invested $18,000 cash in the company in exchange for its common stock. b. The company purchased supplies for $1,250 cash. c. The owner invested $11,500 of equipment in the company in exchange for more common stock. d. The company purchased $350 of additional supplies on credit. The company purchased land for $10,500 cash.Required:Write down the impact of each transaction on individual items of the accounting equation.
Answers
Answer:
since there is not enough room here I used an excel spreadsheet
Explanation:
The impact of each transaction on individual items is shown with the help of an accounting equation.
What is an accounting equation?The accounting equation is a formula that shows the total assets of a company are equal to the sum of its liabilities and shareholders' equity (Assets = Liabilities + Equity). The clear relationship between a company's liabilities, assets, and equity is the foundation of double-entry accounting.
The accounting equation can be reconfigured in three ways: Liabilities + Owner's Capital - Owner's Drawings + Revenues - Expenses = Assets. Assets minus liabilities equals owner's equity. Assets minus liabilities equals net worth.
Therefore, the effect of the above transactions is shown in the form of accounting equation is attached below.
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Economists say that individuals make decisions at the margin. What does its menas?
Answers
Answer:
When Economists say that humans make decisions at the margin they mean that decisions are made on the basis of the cost and benefit of getting an additional unit of a good/ service.
Marginal benefit refers to the additional utility that we will derive from consuming one extra unit of a good or service and factors in heavily into our decision making. We usually accept a decision if the Marginal benefit is higher or equal to the Marginal cost ( cost of the additional unit) of the good/service.
If the Marginal Cost is instead higher, the decision would most probably be cancelled.
The account balances and income statement of Winfrey Towing Service on June 30, 2018, follow:Equipment $18,250 Service Revinue $10,800Office Supplies 1,400 Account Receivable 8,400Notes Payable 5,000 Accounts Payable 11,000Rent Expense 550 Retined Earnings, June 1, 2018, 3,900Cash 2,200 Salries Expense 1,900Dividends 4,000 Common Stock 6,000Required:a. Prepare the statement of retained earnings for Winfrey Towing Service for the month ending June 30, 2018.b. What does the statement of a retained earnings report?
Answers
Answer:
See explanations below.
Explanation:
First , we need to calculate net income
Revenues :
Service revenue $10,800
Less : Expenses:
Salary expense $1,900
Rent expense $550
Total expense. ($2,450)
Net income. $8,350
a. Winfrey Towing Service
Statement of retained earnings
Month ended, June 30 2018
Retained earnings June 1, 2018 $3,900
Add net income for the month $8,350
$12,250
Less: Dividends ($4,000)
Retained earnings June 30, 2018 $8,250
b. Statement of retained earnings report is the change in retained earnings of a firm or business unit during a given period of time.
Refined grain products are often fortified with _____ to decrease rates of _____.a. iodine; early deliveryb. vitamin A; fetal heart abnormalitiesc. folic acid; early deliveryd. iron; neural tube defectse. folic acid; neural tube defects
Answers
Answer: folic acid; neural tube defects
Explanation:
Refined grain products are often fortified with folic acid to decrease rates of neural tube defects.
Refined grains products are the products that have been milled. This means that the bran and the germ has been removed to give the grains a finer texture and also to improve the shelf life of the grain. Examples of refined grain products are white rice, de-germed cornmeal, white flour, and white bread.
What means can managers use to assess political risk? What do you think is the relative effectiveness of these different methods? At the time you are reading this, what countries or areas do you feel pose political risk sufficient to discourage you from doing business there?
Answers
Explanation:
Political business risks can negatively affect the profitability of a company or investment in a particular country or location, these risks are inherent in political crises that affect the economy of a location, so it is necessary for managers to assess political risk using analysis indices of risk, assessment systems, past results, country positioning and it is also essential that managers seek experts for better guidance on political risks.
Brazil, for example, is a country that despite attracting a lot of international investment through government incentives, is going through an internal political crisis that gives it greater instability and causes instability so that investors feel safe in investing in the country, due to the possibility of rapid change in the political scenario that can lead to negative economic changes and unforeseen events that mean negative risks for foreign investors.
Match the accounting terminology to the definitions (Click the icon to view the definitions.)
Definitions
1. Certified management accountants
2. Accounting
a. information system that measures business activities, processes that information into reports, and communicates the results to decision makers
b. professional accountants who serve the general public
c. person or business to whom a business owes money
d. field of accounting that focuses on providing information for internal decision makers professionals who work for a single company field of accounting that focuses on providing information for external decision makers
3. Managerial accounting
4. Certified public accountants
5. Financial accounting
6. Creditor
Answers
Answer:
a. Accounting.
b. Certified public accountants.
c. Creditor.
d. Managerial accounting.
e. Certified management accountants.
f. Financial accounting.
Explanation:
1. Accounting: information system that measures business activities, processes that information into reports, and communicates the results to decision makers.
2. Certified public accountants: professional accountants who serve the general public.
3. Creditor: person or business to whom a business owes money.
4. Managerial accounting: field of accounting that focuses on providing information for internal decision makers.
5. Certified management accountants: professionals who work for a single company.
6. Financial accounting: field of accounting that focuses on providing information for external decision makers.
On April 1, 2016, Maria Adams established Custom Realty. Maria completed the following transactions during the month of April:A. Opened a business bank account with a deposit of $24,000 from personal funds.B. Paid rent on office and equipment for the month, $3,600.C. Paid automobile expenses (including rental charge) for month, $1,350, and miscellaneous expenses, $600.D. Purchased office supplies on account, $1,200.E. Earned sales commissions, receiving cash, $19,800.F. Paid creditor on account, $750.G. Paid office salaries, $2,500.H. Withdrew cash for personal use, $3,500.I. Determined that the cost of supplies on hand was $300; therefore, the cost of supplies used was $900.Required:1. Indicate the effect of each transaction and the balances after each transaction, using the following tabular headings in the exhibit below. In each transaction row (rows indicated by a letter), you must indicate the math sign (+ or -) in columns affected by the transaction. You will not need to enter math signs in the balance rows (rows indicated by Bal.). Entries of 0 (zero) are not required and will be cleared if entered.Assets = Liabilities + Owner’s EquityMaria Maria Accounts Adams, Adams, Sales Salaries Rent Auto Supplies MiscellaneousCash + Supplies = Payable + Capital - Drawing + Commissions - Expense - Expense - Expense - Expense - Expense2. Prepare an income statement for April, a statement of owner’s equity for April, and a balance sheet as of April 30. Refer to the list of Accounts on the accounting equation grid and the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. If a net loss has been incurred, enter that amount as a negative number using a minus sign. You will not need to enter colons (:)
Answers
Answer:
The solution and the calculation is shown on the first , second , third and fourth uploaded image
Explanation: