Answer:
$23,003
Explanation:
Computation for the claim against the insurance company.
Using this formula
Claim against insurance company = Total cost of goods available for sales - Cost of goods sold - Owned inventory on hand on July 16
Let plug in the formula
Claim against insurance company= ($41,010 + 90,490) - [($119,400 - $3,960)*100/140)] - ($33,210- $7,170)
Claim against insurance company= $131,500 - $82,457 - $26,040
Claim against insurance company= $23,003
Therefore the claim against the insurance company is $23,003
Social responsibility theories:________
a. Are generally classified as modern ethical versions of Utilitarianism
b. Determine the moral worth of an action regardless of their consequences
c. Are largely precise legalistic formulations
d. Classify corporate social responsibility as typically the corporation engaging in community and civic affairs in a prudent manner.
Answer:
a. Are generally classified as modern ethical versions of Utilitarianism
Explanation:
It is correct to say that social responsibility theories are generally classified as modern ethical versions of utilitarianism, due to the fact that utilitarianism can be understood as an ethical doctrine whose premise is that moral agents must act to promote the greatest amount of good -be.
In this case, the moral agents are the companies, which currently assume a much larger role than just profitable entities, there is a social demand for companies to have corporate social responsibility, that is, to promote well-being and contribute with the community where they operate, through actions that minimize environmental impacts, social programs, community support, etc.
Select the statement that best describes money's function as a standard of deferred payment.
a. The purchasing power of a currency is relatively stable over time
b. A currency is widely accepted in exchange for goods and services and therefore makes economic transactions easier.
c. A currency can be used to express the value goods and services that are both relatively expensive and goods and services that are relatively cheap.
d. People are willing to accept a currency in the future as compensation for debts accrued earlier
Answer:
d. People are willing to accept a currency in the future as compensation for debts accrued earlier
Explanation:
Money can be used to pay your current debts at a later date since $100 will still be $100 in the future. They might lose some of its value due to inflation, but they do not spoil or rot, and will probably be accepted in the future. imagine trying to pay an old debt with rotten tomatoes or an old cow.
Kragan Clothing Company manufactures its own designed and labeled athletic wear and sells its products through catalog sales and retail outlets. While Kragan has for years used activity-based costing in its manufacturing activities, it has always used traditional costing in assigning its selling costs to its product lines. Selling costs have traditionally been assigned to Kraganâs product lines at a rate of 70% of direct materials costs. Its direct materials costs for the month of March for Kraganâs "high-intensity" line of athletic wear are $395,000. The company has decided to extend activity-based costing to its selling costs. Data relating to the "high-intensity" line of products for the month of March are as follows.
Activity Cost Pools Cost Drivers Overhead Rate Number of Cost Drivers Used per Activity
Sales commissions Dollar sales $0.05 per dollar sales $940,000
AdvertisingâTV Minutes $300 per minute 230
AdvertisingâInternet Column inches $10 per column inch 2,000
Catalogs Catalogs mailed $2.50 per catalog 62,400
Cost of catalog sales Catalog orders $1 per catalog order 8,750
Credit and collection Dollar sales $0.03 per dollar sales $940,000
Requied:
Compute the selling costs to be assigned to the "high-intensity" line of athletic wear for the month of March (1) using the traditional product costing system (direct materials cost is the cost driver), and (2) using activity-based costing.
Answer:
1. $276,500
2. $328,950
Explanation:
1. Computation for the selling costs to be assigned to the "high-intensity" line of athletic wear for the month of March using the traditional product costing system
Traditional product costing = $395,000 * 70%
Traditional product costing = $276,500
Therefore the selling costs to be assigned to the "high-intensity" line of athletic wear for the month of March using the traditional product costing system is $276,500
2. Computation for the selling costs to be assigned to the "high-intensity" line of athletic wear for the month of March using activity-based costing
Activity based costing :
Sales commissions ($940,000*$0.05) $47,000
Advertising - TV (230*$300) $69,000
Advertising - internet (2,000*$10) 20,000
Catalogs (62,400*$2.50) $156,000
Cost of catalog sales (8,750*$1) 8,750
Credit and collection ($940,000*$0.03) $28,200
Selling cost $328,950
Therefore the selling costs to be assigned to the "high-intensity" line of athletic wear for the month of March using activity-based costing is $328,950
Data concerning Wislocki Corporation's single product appear below: Per Unit Percent of Sales Selling price $ 180 100 % Variable expenses 36 20 % Contribution margin $ 144 80 % Fixed expenses are $1,044,000 per month. The company is currently selling 9,000 units per month. Required: The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $14 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $110,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 400 units. What should be the overall effect on the company's monthly net operating income of this change
Answer:
$36,000 increase
Explanation:
The computation of the overall effect on the company's monthly net operating income of this change is shown below:
Particulars Current Proposed
Unit sales 9,000 units 9,400 units
Sales $1,620,000 $1,692,000
(9,000 units × $180) (9,400 units × $180)
less: variable cost -$324,000 -$470,000
(9,000 units × $36) (9,400 units × $50)
Contribution margin $1,296,000 $1,222,000
Less: fixed cost -$1,044,000 -$934,000
Net operating income $252,000 $288,000
Hence, there is an increase in net operating income by
= $288,000 - $252,000
= $36,000
A researcher was interested in the relationship between the number of texts sent in a day and the number of e-mails sent in a day by employees at a certain company. Using 15 data values, a 90 percent confidence interval for the slope of a regression model was found to be (2.31, 3.47). The researcher claims that the interval would have been narrower with a different sample size if all other things remained the same. Which of the following sample sizes would make the researcher's claim NOT true?
A. 14
B. 16
C. 20
D. 30
E. 100
Answer:
A. 14
Explanation:
the researcher claims that the width of the interval would have been smaller if the sample had been different, and in this case different refers to larger. The original sample included only 15 people, so in order to increase the data sample, you must include more than 15 people. That is why 14 doesn't make sense.
Budgeted amount: 0.5 machine hours per (MH) unit Variable overhead rate is $15 per MH Fixed overhead rate is $40 per MH Budgeted fixed overhead is $600,000 Actual amounts: Variable overhead incurred is $190,000 Fixed overhead incurred is $630,000 MH used is 11,000 Actual output is 20,000 units What is the Fixed Overhead Volume Variance
Answer:
Fixed overhead volume variance = $200,000 Favorable
Explanation:
The fixed overhead volume variance is the difference between the actual and budgeted production unit multiplied by the standard fixed production overhead cost per unit
Units
Budgeted units 15,000
Actual units 20,000
Variance 5,000
Fixed overhead rate per unit × $40
Fixed overhead volume variance $200,000
List three pieces of criteria that economists use to determine if someone is employed
Answer:
The summary as per the given query is summarized below.
Explanation:
The criterion used by economists to decide whether the individual was working wasn’t employed.Employees hold down jobs for full as well as part-time pay where they already haven't a job and therefore are provisions of these terms for work even though they are unemployed.The labor force seems to be the number among all jobs working as well as unemployment.Crane Water Co. is a leading producer of greenhouse irrigation systems. Currently, the company manufactures the timer unit used in each of its systems. Based on an annual production of 46,000 timers, the company has calculated the following unit costs. Direct fixed costs include supervisory and clerical salaries and equipment depreciation. Direct materials $12 Direct labor 7 Variable manufacturing overhead 2 Direct fixed manufacturing overhead 9 (30% salaries, 70% depreciation) Allocated fixed manufacturing overhead 7 Total unit cost $37 Clifton Clocks has offered to provide the timer units to Crane at a price of $33 per unit. If Crane accepts the offer, the current timer unit supervisory and clerical staff will be laid off. (a1) Calculate the total relevant cost to make or buy the timer units. (Round answers to 0 decimal places, e.g. 5,250.) Make Buy Total relevant cost $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places
Answer:
Crane Water Co.
Total relevant cost to make or buy Make Buy
Direct materials $12
Direct labor 7
Variable manufacturing overhead 2
Direct fixed manufacturing overhead 6
Total relevant cost to make = $27 $33
Explanation:
a) Data and Calculations:
Annual production of timers = 46,000
Direct materials $12
Direct labor 7
Variable manufacturing overhead 2
Direct fixed manufacturing overhead 9
(30% salaries, 70% depreciation)
Allocated fixed manufacturing overhead 7
Total unit cost $37
Clifton Clocks offer price = $33
Total relevant cost to make or buy Make Buy
Direct materials $12
Direct labor 7
Variable manufacturing overhead 2
Direct fixed manufacturing overhead 6
Total relevant cost to make = $27 $33
b) Crane Water Co. will be in a better position if it continues to make the timer. It should not accept the offer from Clifton Clocks. The relevant cost to make is lower than the relevant cost to buy the timer from Clifton Clocks.
Match each of the following example with the control method that is or should be used by entering the letter of the example in the answer space next to the correct control method.
a. Police work is changing. More and more police departments today are implementing community policing practices: working with the public to create a safer environment for all. For this reason, performance evaluations for police officers are starting to include criteria such as helpfulness and friendliness, which are measures of actions, not outcomes.
b. Sam writes for a living and loves it. He writes every dayâsometimes working on his blog, sometimes on a novel, but always putting something on paper. He learned about perseverance in his college success class, and now he sets aside four hours a day just for writing, regardless of what other activities he may have planned.
c. Lifeguards may seem to have an easy life, but the work is really very difficult. All lifeguards have to receive specialized training and be prepared to jump into action at a momentâs notice if an emergency arises. Professional lifeguards use a paramilitary structure (chief, captain, lieutenant, sergeant, and two levels of lifeguards) so that there is only one person giving orders in the event of an emergency.
d. Speed is the name of the game when you are picking applesâthe more you pick, the more you get paid. Gustavo receives $13 per box. He and his coworkers know that if they pick fewer than five boxes a day, they will be asked to leave the orchard.
1. Bureaucratic control
2. Behavior control
3. Output control
4. Normative control
Answer:
Control Examples Control Method
a. Behavior control
b. Output control
c. Bureaucratic control
d. Normative control
Explanation:
Control methods:
1. Bureaucratic control is a control method achieved through organizational structures and systems.
2. Behavior control: This is a control method that focuses on self-awareness rather than on organizational structures and systems.
3. Output control makes Sam aware that he must write every day to earn a living.
4. Normative control is a control method that establishes values and beliefs that make team members to behave responsibly.
Matching each of the following example with the control method which was used would give us:
A. Behavior control B. Output control C. Bureaucratic control D. Normative control
According to the given question, we are asked to match the following examples with the control method which was used withe different scenarios.
As a result of this, we can see that the different control methods which were described were all meant to keep a certain person or groups of persons in check and prevent them from overstepping their boundaries and also to preserve order among functional members of the society.
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The Crunchy Granola Company is a diversified food company that specializes in all natural foods. The company has three operating divisions organized as investment centers. Condensed data taken from the records of the three divisions for the year ended June 30, 20Y7, are as follows:
Cereal Division Snack Cake Division Retail Bakeries Division
Sales $25,000,000 $8,000,000 $9,750,000
Cost of goods sold 16,670,000 5,575,000 6,795,000
Operating expenses 7,330,000 1,945,000 2,272,500
Invested assets 10,000,000 4,000,000 6,500,000
The management of The Crunchy Granola Company is evaluating each division as a basis for planning a future expansion of operations.
Required:
1. Prepare condensed divisional income statements for the three divisions, assuming that there were no service department charges.
2. Using the DuPont formula for rate of return on investment, compute the profit margin, investment turnover, and rate of return on investment for each division.
3. If available funds permit the expansion of operations of only one division, which of the divisions would you recommend for expansion?
Answer:
charges.
2. Using the DuPont formula for rate of return on investment, compute the profit margin, investment turnover, and rate of return on investment for each division.
3. If available funds permit the expansion of operations of only one division, which of the divisions would you recommend for expansion?
Precision Castparts, a manufacturer of processed engine parts in the automotive and airline industries, borrows $39.4 million cash on October 1, 2021, to provide working capital for anticipated expansion. Precision signs a one-year, 9% promissory note to Midwest Bank under a prearranged short-term line of credit. Interest on the note is payable at maturity. Each firm has a December 31 year-end.
Required:
a. Prepare the journal entries on October 1, 2021, to record the issuance of the note.
b. Record the adjustments on December 31, 2021.
c. Prepare the journal entries on September 30, 2021, to record payment of the notes payable at maturity.
Answer:
a. Precision Castparts
Dr Cash $39.4 million
Cr Notes Payable $39.4 million
Midwest Bank
Dr Notes Receivable $39.4 million
Cr Cash $39.4 million
b. Precision Castparts
Dr Interest expense $886,500
Cr Interest payable $886,500
Midwest Bank
Dr Interest receivable $886,500
Cr Interest revenue $886,500
c. Precision Castparts
Dr Notes payable $39.4 million
Dr Interest expense $2,659,500
Dr Interest payable $886,500
Cr Cash $42,946,000
Midwest Bank
Dr Cash $42,946,000
Cr Notes receivable $39.4 million
Cr Interest revenue $2,659,500
Cr Interest receivable $886,500
Explanation:
a. Preparation of the journal entries on October 1, 2021, to record the issuance of the note.
Precision Castparts
Dr Cash $39.4 million
Cr Notes Payable $39.4 million
Midwest Bank
Dr Notes Receivable $39.4 million
Cr Cash $39.4 million
b. Preparation of the journal entry to Record the adjustments on December 31, 2021.
Precision Castparts
Dr Interest expense $886,500 ($39.4 million x 9% x 3/12)
Cr Interest payable $886,500
Midwest Bank
Dr Interest receivable $886,500
Cr Interest revenue $886,500
($39.4 million x 9% x 3/12)
c. Preparation of the journal entries on September 30, 2021, to record payment of the notes payable at maturity.
Precision Castparts
Dr Notes payable $39.4 million
Dr Interest expense $2,659,500($39.4 million x 9% x 9/12)
Dr Interest payable $886,500
($39.4 million x 9% x 3/12)
Cr Cash $42,946,000
($39.4 million+$2,659,500+$886,500)
Midwest Bank
Dr Cash $42,946,000
($39.4 million+$2,659,500+$886,500)
Cr Notes receivable $39.4 million
Cr Interest revenue $2,659,500($39.4 million x 9% x 9/12)
Cr Interest receivable $886,500
($39.4 million x 9% x 3/12)
Bill Blumberg owns an auto parts business called Bill's Auto Parts. The following transactions took place during July of the current year.
July 5 Purchased merchandise on account from Wheeler Warehouse, $4,300.
8 Paid freight charge on merchandise purchased, $230.
12 Sold merchandise on account to Big Time Spoiler, $3,500. The merchandise
cost $2,500.
15 Received a credit memo from Wheeler Warehouse for merchandise, $670.
22 Issued a credit memo to Big Time Spoiler for merchandise returned, $820.
The cost of the merchandise is $550.
Required:
1. Journalize the above transactions in a general journal using the periodic inventory method.
2. Journalize the above transactions in a general journal using the perpetual inventory method.
Answer:
The solution to these question is defined in the attached file please find it.
Explanation:
outlinr the selection procedure as a huma resource activity
Answer and Explanation:
A selection process as a human resources activity must be outlined, starting with the filling out of a form by the candidates for the vacancy that they are being offered through the selection. This form must contain basic information that will allow the human resources department to select people who have the minimum requirements necessary to participate in the next phase of the process. The next phase should be an interview, to get to know the candidates, assess their communication skills and ask incisive questions about the skills they have and the level of interest in the vacancy they are competing for. This is the key moment in the process, where the human resources department will be able to determine who deserves to be selected.
Clementine Company makes skateboards. They prepare master and flexible budgets and then perform variance analysis after the budget plan period elapses. Their data is as follows: Budget Actual Selling price per unit $96 $104 Variable cost per unit $52 $55 Quantity sold 996 1,024 What is the Clementine's volume variance for SALES? If the variance is unfavorable put a minus sign in front of your answer. Enter your answer without commas or decimals.
Answer:
See below
Explanation:
Sales volume variance is the difference between Budgeted quantity and actual quantity sold, multiplied by the standard profit margin. Standard profit margin is the excess of Budgeted selling price over actual selling price
Therefore,
Clementine's sales volume variance
= (BQ - AQS) × Standard profit margin
= (996 - 1,024) × ($96 - $52)
= -28 × -$44
= $1,232 F
why is having insurance important ?
Answer:
Explanation:
Because nothing is worth risking when you can have someone back you up. If something ever happens to you that you can't afford, insurance companies will have your back. If your house gets destroyed in a hurricane, you can recover the exact value of the house if you have insurance. However, if you don't have insurance, you bascially just lost your house. You can have insurance for many things such as car insurance, life insurance, health insurance.
Suppose the economy is experiencing a recession. The output gap is hovering at −7%, causing higher than normal unemployment. Using the Fed model, complete the following passages to compare and contrast how monetary policy and fiscal policy can impact the economy. a. The Federal Reserve can reduce the to stimulate greater output and employment. The federal government can increase to help ease the recession. b. If both monetary and fiscal policy are used, the MP curve will shift , and the IS curve will shift to the . Both shifts will increase , and t
Answer:
a. The Federal Reserve can reduce the interest rates to stimulate greater output and employment. The federal government can increase government spending to help ease the recession.
The Fed can reduce interest rates by engaging in expansionary monetary policy that would then make it easier to borrow funds for investment. The Federal government can also increase spending as this will put more money into the economy to help it start moving again.
b. If both monetary and fiscal policy are used, the MP curve will shift downward, and the IS curve will shift to the right. Both shifts will increase income.
If both monetary and fiscal policy are used, companies will start producing again and hiring more people which will shift the Marginal Productivity curve downward. The IS curve will also shift to the right and both to these are indicators of an increase in income.
The CHS Company has provided the following information: Accounts receivable written-off as uncollectible during the year amounted to $12,500. The accounts receivable balance at the beginning of the year was $250,000. The accounts receivable balance at the end of the year was $310,000. The allowance for doubtful accounts balance at the beginning of the year was $15,000. The allowance for doubtful accounts balance at the end of the year after the recording of bad debt expense was $13,900. Credit sales during the year totaled $950,000. How much was CHS Company's bad debt expense
Answer:
$11,400
Explanation:
Calculation to determine CHS Company's bad debt expense
Using this formula
Bad debt expense =Bad debt expense -(Allowance for doubtful accounts balance at the beginning of the year -Accounts receivable written-off as uncollectible during the year )
Let plug in the formula
Bad debt expense=$13,900-( $15,000-$12,500)
Bad debt expense=$13,900-$2,500
Bad debt expense=$11,400
Therefore CHS Company's bad debt expense is $11,400
On March 1, Imhoff Co. began construction of a small building. Payments of $202,539 were made monthly for several months. The payments begin on the first day of March. The building was completed and ready for occupancy on the first day of June. In determining the amount of interest cost to be capitalized, the weighted-average accumulated expenditures are
Answer:
$101,269.5
Explanation:
Calculation to determine the weighted-average accumulated expenditures
Weighted-average accumulated expenditures=$202,539* (3/12 + 2/12 + 1/12)
Weighted-average accumulated expenditures=$202,539*0.5
Weighted-average accumulated expenditures=$101,269.5
Therefore In determining the amount of interest cost to be capitalized, the weighted-average accumulated expenditures are $101,269.5
Calculate (a) the accounts receivable period, (b) accounts payable period, (c) inventory period, and (d) cash cycle for the following firm. (Use 365 days a year. Do not round intermediate calculations. Round your answers to 1 decimal place.) Income Statement Data: Sales $ 5,000 Cost of goods sold 4,200 Balance Sheet Data: Inventory $ 550 Accounts receivable 110 Accounts payable 270
Answer:
a. Accounts receivable period:
= Accounts receivable turnover ratio * 365 days
= (Average accounts receivable / Sales) * 365
= (110 / 5,000) * 365
= 8.0 days
b. Accounts Payable period:
= Accounts payable turnover ratio * 365
= (Average accounts payable / Cost of goods sold) * 365
= (270 / 4,200) * 365
= 23.5 days
c. Inventory period:
= Inventory turnover ratio * 365
= (Average inventory / Cost of goods sold) * 365
= (550 / 4,200) * 365
= 47.8 days
d. Cash cycle:
= Inventory period + Accounts receivables period - Accounts payable period
= 47.8 + 8 - 23.5
= 32.3 days
P3-uZ Company produces leather sandals. The company employs a standard costing system and has the following standards in order to produce one pair of sandals:
Standard quantity Standard price
Direct materials 2 leather strips ?? per strip
Direct Labor 2.5 hours $12 per hour
Variable overhead 2.5 hours ?? per hour
During May, P3-uz used 16,300 leather strips in the production of sandals. P3-uz had no beginning inventories of any type for May. At May 31, P3-uz had 600 leather strips remaining in its direct materials inventory.
P3-uz Company reported the following variances for May:
Direct material price variance $40,525 favorable
Direct labor rate variance $27,560 unfavorable
Total direct labor variance $37,240 favorable
Variable overhead spending variance $9,280 unfavorable
Variable overhead efficiency variance $60,480 favorable
Required:
Calculate P3-uz's direct material quantity variance for May.
Answer:
Direct material quantity variance for May = (16,300 - (2 * Actual number of sandals produced in May)) * 9.84
Explanation:
Note: This question is not complete as total cost of leather strips purchased and direct labor are both omitted. The complete question is therefore provided before answering the question as follows:
P3-uZ Company produces leather sandals. The company employs a standard costing system and has the following standards in order to produce one pair of sandals:
Standard quantity Standard price
Direct materials 2 leather strips ?? per strip
Direct Labor 2.5 hours $12 per hour
Variable overhead 2.5 hours ?? per hour
During May, P3-uz purchased leather strips at a total cost of $124,250 and had direct labor totaling $154,760. During May, P3-uz used 16,300 leather strips in the production of sandals. P3-uz had no beginning inventories of any type for May. At May 31, P3-uz had 600 leather strips remaining in its direct materials inventory.
P3-uz Company reported the following variances for May:
Direct material price variance $40,525 favorable
Direct labor rate variance $27,560 unfavorable
Total direct labor variance $37,240 favorable
Variable overhead spending variance $9,280 unfavorable
Variable overhead efficiency variance $60,480 favorable
Required:
Calculate P3-uz's direct material quantity variance for May.
The explanation of the answer is now given as follows:
Actual total quantity = Number of strips of leather used in production = 16,300
Number of strips of leather purchased = Actual total quantity + Number of leather strips remaining in its direct materials inventory = 16,300 + 600 = 16,900
Actual price per strips = Total cost of leather strips purchased / Number of strips of leather purchased = $124,250 / 16,900 = $7.35
Direct material price variance = (Standard price – Actual price) * Actual quantity ................... (1)
Substituting the relevant values into equation (1) and solve for Standard price, we have:
$40,525 = (Standard price - 7.35) * 16,300
$40,525 = (Standard price * 16,300) - (7.35 * 16300)
(Standard price * 16,300) = $40,525 + (7.35 * 16300)
Standard price = ($40,525 + (7.35 * 16300)) / 16,300
Standard price = $9.84
Therefore, we have:
Direct material quantity variance for May = (Actual total quantity - (Standard quantity * Actual number sandals produced)) * Standard price ................. (2)
Substituting the relevant values into equation (2) and solve for Standard price, we have:
Direct material quantity variance for May = (16,300 - (2 * Actual number of sandals produced in May)) * 9.84 ............... (3)
Therefore, equation (3) gives the Direct material quantity variance for May since the question is silent on the Actual number of sandals produced produced in May.
FedEx is the world's largest express transportation company. In addition to the world's largest fleet of all-cargo aircraft, the company has more than 650 aircraft and 58.000 vehicles and trailers that pick up and deliver packages. Assume that FedEx sold a delivery truck that had been used in the business for three years. The records of the company reflected the following:
Delivery truck cost $35,000
Accumulated depreciation $23,000
Required:
1. Give the journal entry for the disposal of the truck, assuming that the truck sold for
a. $12,000 cash
b. $12.400 cash
c. $11,500 cash
2. Based on the three preceding situations, explain the effects of the disposal of an asset.
Answer:
1-a. Debit Cash for $12,000; Debit Accumulated depreciation - Truck for $23,000; and Credit Equipment - Truck for $35,000.
1-b. Debit Cash for $12,400; Debit Accumulated depreciation - Truck for $23,000; Credit Gain on sale of equipment for $400; and Credit Equipment - Truck for $35,000.
1-c. Debit Cash for $11,500; Debit Accumulated depreciation - Truck for $23,000; Debit Loss on sale of equipment for $500; and Credit Equipment - Truck for $35,000.
2-a. The disposal the asset (Delivery truck) for $12,000 cash results into neither gain nor loss.
2-b. The disposal the asset (Delivery truck) for $12,400 cash results into a gain of $400.
2-b. The disposal the asset (Delivery truck) for $11,500 cash results into a loss of $500.
Explanation:
1-a. Give the journal entry for the disposal of the truck, assuming that the truck sold for $12,000 cash.
Gain or loss on the disposal of delivery truck = Cash - (Delivery truck cost - Accumulated depreciation) = $12,000 - ($35,000 - $23,000) = $12,000 - $12,000 = $0
Therefore, the journal entries will look as follows:
Particulars Debit ($) Credit ($)
Cash 12,000
Accumulated depreciation - Truck 23,000
Equipment - Truck 35,000
(To record the disposal of delivery truck.)
1-b. Give the journal entry for the disposal of the truck, assuming that the truck sold for $12,400 cash.
Gain or loss on the disposal of delivery truck = Cash - (Delivery truck cost - Accumulated depreciation) = $12,400 - ($35,000 - $23,000) = $12,400 - $12,000 = $400 gain
Therefore, the journal entries will look as follows:
Particulars Debit ($) Credit ($)
Cash 12,400
Accumulated depreciation - Truck 23,000
Gain on sale of equipment 400
Equipment - Truck 35,000
(To record the disposal of delivery truck.)
1-c. Give the journal entry for the disposal of the truck, assuming that the truck sold for $11,500 cash.
Gain or loss on the disposal of delivery truck = Cash - (Delivery truck cost - Accumulated depreciation) = $11,500 - ($35,000 - $23,000) = $11,500 - $12,000 = $500 loss
Therefore, the journal entries will look as follows:
Particulars Debit ($) Credit ($)
Cash 11,500
Accumulated depreciation - Truck 23,000
Loss on sale of equipment 500
Equipment - Truck 35,000
(To record the disposal of delivery truck.)
2. Based on the three preceding situations, explain the effects of the disposal of an asset.
2-a. The disposal the asset (Delivery truck) for $12,000 cash results into neither gain nor loss.
2-b. The disposal the asset (Delivery truck) for $12,400 cash results into a gain of $400.
2-b. The disposal the asset (Delivery truck) for $11,500 cash results into a loss of $500.
Tubaugh Corporation has two major business segments--East and West. In December, the East business segment had sales revenues of $380,000, variable expenses of $205,000, and traceable fixed expenses of $45,000. During the same month, the West business segment had sales revenues of $1,050,000, variable expenses of $536,000, and traceable fixed expenses of $201,000. The common fixed expenses totaled $310,000 and were allocated as follows: $155,000 to the East business segment and $155,000 to the West business segment. A properly constructed segmented income statement in a contribution format would show that the segment margin of the East business segment is:____________.
a. $205,000
b. $130,000
c. $(23,000)
d. $(20,000)
Answer:
b. $130,000
Explanation:
The contribution margin income statement is presented below
Particulars Total company East West
Sales $1,430,000 $380,000 $1,050,000
Less: variable expense -$741,000 -$205,000 -$536,000
Contribution margin $689,000 $175,000 $514,000
Less: fixed expense -$246,000 -$45,000 -$201,000
Segment margin $443,000 $130,000 $313,000
Less: common fixed expense $310,000
Operating income $133,000
X Company must purchase a new delivery truck and is using the payback method to evaluate two possible trucks. Truck 1 costs $31,000; Truck 2 costs $44,000. The useful life of both is seven years, with the following estimated operating cash flows:
Year Truck 1 Truck2
1 6000 7000
2 8,000 4,000
3 8,000 3,000
4 8,000 3,000
5 6,000 3,000
6 5,000 2,000
7 4,000 2,000
If X Company chooses Truck 2 instead of Truck 1, what is the payback period (in years)?
A: 2
B: 3
C: 4
D: 5
E: 6
F: 7
Answer:
C: 4
Explanation:
The computation of the payback period is shown below:
Incremental investment in truck 2 is
= $44,000 - $31,000
= $13,000
Now
Year Cash saving in cost Cumulative
1 -$1,000 -$1,000
2 $4,000 $3,000
3 $5,000 $8,000
4 $5,000 $13,000
5 $3,000 $16,000
6 $3,000 $19,000
7 $2,000 $21,000
The financial information below presents selected information from the financial statements of Pelican Company. Sales revenue during the current year was $13,340,300 and cost of goods sold was $8,914,195. All of Pelican's sales are made on account and are due within 30 days. Prior Year Current Year Cash and cash equivalents $ 570,330 $ 635,780 Accounts receivable 4,730,000 3,818,000 Inventory 938,360 1,277,440 Total current assets 8,250,030 8,210,100 Total assets 11,118,020 10,998,000 Total current liabilities 7,830,300 6,306,000 Total liabilities 8,467,900 8,276,700 Required: Current ratios as of the end of the current and prior year. Calculate the receivables turnover ratio for the current year. Calculate the days to collect for the current year. Calculate the inventory turnover ratio for the current year. Calculate the days to sell for the current year.
Required A
Required B
Required C
Required D
Required E
Current ratios as of the end of the current and prior year. (Round your answers to 2 decimal places.)
Current Year Prior Year
Current Ratio
Required A
Required B
Required C
Required D
Required E
Calculate the receivables turnover ratio for the current year. (Round your answer to 2 decimal places.)
Receivables Turnover Ratio
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C
Required D
Required E
Calculate the days to collect for the current year. (Round your intermediate calculations. Round your final answer to 2 decimal places.)
Days to Collect
Required A
Required B
Required C
Required D
Required E
Calculate the inventory turnover ratio for the current year. (Round your answer to 2 decimal places.)
Inventory Turnover Ratio
Required A
Required B
Required C
Required D
Required E
Calculate the days to sell for the current year. (Round your intermediate calculations. Round your final answer to 2 decimal places.)
Days to Sell
Answer:
Current Ratio 1.05
Receivable turnover days 129 days
Days to collect 2.83
Inventory Turnover days 38 days
Days to sell 9.61
Explanation:
Current Ratio : Total Current Assets / Total Current Liabilities
Current Ratio : 8,250,030 / 7,830,300 = 1.05
Receivable turnover days : ( Accounts Receivable / Total Sales ) * 365 days
Receivable turnover days : ( 4,730,000 / 13,340,300 ) * 365
Receivable turnover days : 129 days
Days to collect : 365 days / Accounts receivable turnover days
Days to collect : 365 / 129 days = 2.83
Inventory turnover days : ( Inventory / Cost of goods sold ) * 365
Inventory turnover days : ( 938,360 / 8,914,195 ) * 365
Inventory turnover days : 38 days
Days to sell : 365 days / Inventory turnover ratio
Days to sell : 365 / 38 days = 9.61
Solar Innovations Corporation bought a machine at the beginning of the year at a cost of $25,000. The estimated useful life was five years and the residual value was $3,000. Assume that the estimated productive life of the machine is 10,000 units.
Expected annual production was:
Year 1 2,000 units
Year 2 3,000 units
Year 3 2,000 units
Year 4 2,000 units
Year 5 1,000 units
1. Complete the cost column of a depreciation schedule for each of the alternative methods.
a. Straight-line
Income Statement Balance Sheet
Year Depreciation Expense Cost Accumulated Depreciation Book Value
At acquisition $25,000
1 $4,400 $25,000 $4,400 20,600
2 4,400 8,800 16,200
3 4,400 13,200 11,800
4 4,400 17,600 7,400
5 4,400 22,000 3,000
b. Units-of-production
Income Statement Balance Sheet
Year Depreciation Expense Cost Accumulated Depreciation Book Value
At acquisition $25,000
1 $4,400 $25,000 $4,400 20,600
2 6,600 11,000 14,000
3 4,400 15,400 9,600
4 4,400 19,800 5,200
5 2,200 22,000 3,000
c. Double-declining-balance
Income Statement Balance Sheet
Year Depreciation Expense Cost Accumulated Depreciation Book Value
At acquisition $25,000
1 $10,000 $25,000 $10,000 15,000
2 6,000 16,000 9,000
3 3,600 19,600 5,400
4 2,160 21,760 3,240
5 240 22,000 3,000
Answer:
a. Straight Line :
Year 1 $4,400
Year 2 $ 4,400
Year 3 $4,400
Year 4 $4,400
Year 5 $ 4,400
b. Units production :
Year 1 $5,000
Year 2 $7,500
Year 3 $5,000
Year 4 $5,000
Year 5 $2,500
c. Double declining :
Year 1 $12,500
Year 2 $6,250
Year 3 $3,125
Year 4 $1,562.5
Year 5 $781.25
Explanation:
a. Straight Line depreciation : ( Cost of asset - Salvage Value ) / Useful Life
Depreciation : ( 25,000 - 3,000 ) / 5 years = 4,400
b. Units of Production : ( Cost of Asset / Total Machine units ) * Usage per year
Year 1 : ( 25,000 / 10,000 ) * 2,000 = $5,000
Year 2 : ( 25,000 / 10,000 ) * 3,000 = $7,500
Year 3 : ( 25,000 / 10,000 ) * 2,000 = $5,000
Year 4 : ( 25,000 / 10,000 ) * 2,000 = $5,000
Year 5 : ( 25,000 / 10,000 ) * 1,000 = $2,500
c. Double declining Method : Cost * declining percentage
Year 1 : 25,000 * 50% = 12,500
Year 2 : 25,000 * 25% = 6,250
Year 3 : 25,000 * 12.5% = 3,125
Year 4 : 25,000 * 6.25% = 1,562.5
Year 5 : 25,000 * 3.125% = 781.25
Which of the following is not a way to accomplish an activity cost reduction? a.improve operations so that the activity-base usage per unit is reduced b.use lower-cost materials c.change the classification of employees doing an activity so as to decrease the activity rate d.none of the above
Answer:
b. use lower-cost materials
Explanation:
In Accounting, costing is the measurement of the cost of production of goods and services by assessing the fixed costs and variable costs associated with each step of production.
Production costs can be categorized as;
1. Variable costs: these are costs that usually change with respect to changes in the level of production or output. Examples are direct labor, maintenance of equipment or machines, raw materials costs etc.
2. Fixed costs: these are the costs which are not directly related to the level of production or not affected by the quantity of output in an organization. Examples are rent, depreciation, administrative cost, research and development costs, marketing costs etc.
Some of the ways to accomplish activity cost reduction are;
I. The operations of a business firm should be improved in order to make the activity-base usage per unit to be reduced.
II. The classification of employees doing an activity should be changed so as to decrease the activity rate.
Chrzan, Inc., manufactures and sells two products: Product E0 and Product N0. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Expected Production Direct Labor-Hours Per Unit Total Direct Labor-Hours Product E0 340 9.4 3,196 Product N0 1,200 8.4 10,080 Total direct labor-hours 13,276 The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product E0 Product N0 Total Labor-related DLHs $ 298,390 3,196 10,080 13,276 Production orders orders 57,587 500 600 1,100 Order size MHs 581,866 5,200 4,900 10,100 $ 937,843 The activity rate for the Order Size activity cost pool under activity-based costing is closest to:
Answer:
Order size= $57.61 per machine hour
Explanation:
Giving the following information:
Order size:
Estimated total overhead= $581,866
Estimated total machine hours= 10,100
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Order size= 581,866 / 10,100
Order size= $57.61 per machine hour
Pretzelmania, Inc., issues 7%, 10-year bonds with a face amount of $70,000 for $70,000 on January 1, 2021. The market interest rate for bonds of similar risk and maturity is 7%. Interest is paid semiannually on June 30 and December 31.
Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $70,000 for $63,948 on January 1, 2015. The market interest rate for bonds of similar risk and maturity is 8%. Interest is paid semiannually on June 30 and December 31.
Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $70,000 for $76,860 on January 1, 2015. The market interest rate for bonds of similar risk and maturity is 6%. Interest is paid semiannually on June 30 and December 31.
All 3 question are need to find the first interest payment The only difference between 3 is the rate is one below, one higher, one are equal. No need to find the issuance bonds. Because I already had that one done.
Please and solve for thefirst interest payment with the steps that would be wonderful, thanks
Record bond issue and related semiannual interest (L04) Pretzelmania, Inc., issues 796, 10-year bonds with a face amount of $70,000 for $70,000 on January 1 2015. The market interest rate for bonds of similar risk and maturity is 7%. Interest is paid semiannually on June 30 and December 31 1. & 2. Record the bond issue and first interest payment on June 30, 2015. (If no entry is required for a transaction event, select "No journal entry required" in the first account field.) view transaction list view general journal Date General Journal Debit Credit January 01, 2015 Cash 70,000 Bonds payable 70,000 June 30, 2015 Interest expense Bonds payable Cash value: 3.33 points Brief Exercise 9-6 Record bond issue and related semiannual interest (L04) Pretzelmania, Inc., issues 796, 15-year bonds with a face amount of $70,000 for $63.948 on January 1 2015. The market interest rate for bonds of similar risk and maturity is 8%. Interest is paid semiannually on June 30 and December 31 1. & 2. Record the bond issue and first interest payment on June 30, 2015. (If no entry is required for a transaction event, select "No journal entry required" in the first account field.) view transaction list view general journal Date General Journal Debit Credit January 01, 2015 Cash 63,948 Bonds payable 63,948 June 30, 2015 Interest expense Bonds payable Cash value: 3.34 points Brief Exercise 9-7 Record bond issue and related semiannual interest (L04) Pretzelmania, Inc., issues 796, 15-year bonds with a face amount of $70,000 for $76.860 on January 1 2015. The market interest rate for bonds of similar risk and maturity is 6%. Interest is paid semiannually on June 30 and December 31 1. & 2. Record the bond issue and first interest payment on June 30, 2015. (lf no entry is required for a transaction event, select "No journal entry required" in the first account field.) view transaction list view general journal Date General Journal Debit Credit January 01, 2015 Cash 76,860 Bonds payable 76,860 June 30, 2015 Interest expense Bonds payable Cash
Answer:
Pretzelmania, Inc.
1. Records:
Debit Cash $70,000
Credit Bonds Liability $70,000
To record the issuance of 7% bonds at face value.
June 30:
Interest Expense $2,450
Cash payment for interest $2,450
To record the first interest expense and payment.
(No amortization of discounts or premiums)
December 31: (not required but showed for emphasis)
Debit Interest Expense $2,450
Credit Cash payment for interest $2,450
To record the second interest expense and payment.
(No amortization of discounts or premiums)
2. Records:
Debit Cash $63,948
Bonds Discounts $6,052
Bonds Liability $70,000
To record the issuance of 7% bonds at discounts.
June 20, 2015:
Debit Interest Expense $2,557.92
Credit Amortization of bonds discounts $107.92
Credit Cash payment for interest $2,450
To record the first interest expense and payment, including amortization of bonds discounts.
December 31, 2015: (not required but showed for emphasis)
Debit Interest Expense $2,562.24
Credit Amortization of bonds discounts $112.24
Credit Cash payment for interest $2,450
To record the second interest expense and payment, including amortization of bonds discounts.
3. Records:
Debit Cash $76,860
Credit Bonds Liability $70,000
Credit Bonds Premium $6,860
To record the issuance of 7% bonds at premium.
June 30, 2015:
Debit Interest Expense $2,305.80
Debit Amortization of bonds premium $144.20
Credit Cash payment for interest $2,450
To record the first interest expense and payment, including amortization of bonds premium.
December 31, 2015: (not required but showed for emphasis)
Debit Interest Expense $2,301.50
Debit Amortization of Bonds Premium $148.50
Credit Cash payment for interest $2,450
To record the second interest expense and payment, including amortization of bonds premium.
Explanation:
1. issues 7%, 10-year bonds with a face amount of $70,000 for $70,000 on January 1, 2021. The market interest rate for bonds of similar risk and maturity is 7%. Interest is paid semiannually on June 30 and December 31.
a) Data and Calculations:
Face value of bonds = $70,000
Issuance value = $70,000
Interest rate on bonds = 7%
Market interest rate = 7%
Period of bonds = 10 years
Payment period = semiannually
Issue date = January 1, 2021
June 30:
Semiannual interest rate = 3.5% (7%/2)
Interest Expense = $2,450 ($70,000 * 3.5%)
Cash payment for interest = $2,450
No amortization of discounts or premiums
December 31:
Semiannual interest rate = 3.5% (7%/2)
Interest Expense = $2,450 ($70,000 * 3.5%)
Cash payment for interest = $2,450
No amortization of discounts or premiums
2. Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $70,000 for $63,948 on January 1, 2015. The market interest rate for bonds of similar risk and maturity is 8%. Interest is paid semiannually on June 30 and December 31.
a) Data and Calculations:
Face value of bonds = $70,000
Issuance value = $63,948
Bonds discounts = $6,052 ($70,000 - $63,948)
Interest rate on bonds = 7%
Market interest rate = 8%
Period of bonds = 15 years
Payment period = semiannually
Issue date = January 1, 2015
June 30, 2015:
Semiannual interest rate = 3.5% (7%/2)
Interest Expense = $2,557.92 ($63,948 * 4%)
Amortization of bonds discounts = $107.92 ($2,557.92 - $2,450)
Cash payment for interest = $2,450 ($70,000 * 3.5%)
December 31, 2015:
Semiannual interest rate = 3.5% (7%/2)
Interest Expense = $2,562.24 (($63,948 + 107.92) * 4%)
Amortization of bonds discounts = $112.24 ($2,562.24 - $2,450)
Cash payment for interest = $2,450 ($70,000 * 3.5%)
3. Pretzelmania, Inc., issues 7%, 15-year bonds with a face amount of $70,000 for $76,860 on January 1, 2015. The market interest rate for bonds of similar risk and maturity is 6%. Interest is paid semiannually on June 30 and December 31.
a) Data and Calculations:
Face value of bonds = $70,000
Issuance value = $76,860
Bonds premium = $6,860 ($76,860 - $70,000)
Interest rate on bonds = 7%
Market interest rate = 6%
Period of bonds = 15 years
Payment period = semiannually
Issue date = January 1, 2015
June 30:
Semiannual interest rate = 3.5% (7%/2)
Cash payment for interest = $2,450 ($70,000 * 3.5%)
Interest Expense = $2,305.80 ($76,860 * 3%)
Amortization of bonds premium = $144.20 ($2,450 - $2,305.80)
December 31:
Semiannual interest rate = 3.5% (7%/2)
Cash payment for interest = $2,450 ($70,000 * 3.5%)
Interest Expense = $2,301.50 (($76,860 -144.20) * 3%)
Amortization of bonds premium = $148.50 ($2,450 - $2,301.50)
(Record bond issue and related semiannual interest)
Yukelson Company owns the building occupied by its administrative office. The office building was reflected in the accounts at the end of last year as follows:
a, Cost when acquired $412,500
b. Accumulated depreciation (based on straight-line depreciation, an estimated life of 50 years, and a $37,500 residual value) 60,000
During January of this year, on the basis of a careful study, management decided that the total estimated useful life should be changed to 30 years (instead of 50) and the residual value reduced to $22,500 (from $30,000). The depreciation method will not change.
Required:
1. Compute the annual depreciation expense prior to the change in estimates.
2. Compute the annual depreciation expense after the change in estimates.
3. What will be the net effect of changing estimates on the balance sheet, net income, and cash flows for the year?
Answer:
Yukelson Company
1. The annual depreciation expense prior to the change in estimates is:
= $7,500.
2. The annual depreciation expense after the change in estimates is:
= $13,000.
3. The net effect of changing estimates on the balance sheet, net income, and cash flows for the year:
Balance Sheet:
The accumulated depreciation will increase by $5,500, thus reducing the net book value of the building.
Net Income:
The net income will be reduced by $5,500.
Cash Flows:
No effect on cash flows because depreciation is not a cash flow item. The only adjustment will be when the net income is used to compute the cash flows.
Explanation:
a) Data and Calculations:
Cost Building = $412,500
Estimated residual value = $37,500
Estimated useful life = 50 years
Accumulated depreciation = $60,000
Depreciable amount = $375,000 ($412,500 - $37,500)
Annual depreciation expense = $7,500 ($375,000/50)
Revised residual value = $22,500
Revised useful life = 30 years
Depreciable amount = $390,000 ($412,500 - $22,500)
Annual depreciation expense = $13,000 ($390,000/30)
Your job pays you only once a year for all the work you did over the previous 12 months. Today, December 31, you just received your salary of $72,500, and you plan to spend all of it. However, you want to start saving for retirement beginning next year. You have decided that one year from today you will begin depositing 5 percent of your annual salary in an account that will earn 9 percent per year. Your salary will increase at 3.7 percent per year throughout your career. How much money will you have on the date of your retirement 40 years from today?
Answer:
$1,924,410.40
Explanation:
Calculation to determine How much money will you have on the date of your retirement 40 years from today
First step is to calculate Next year’s salary
Next year’s salary = $72,500 (1 + ..037)
Next year’s salary = $75,182.50
Second step is to calculate Next year’s deposit
Next year’s deposit = $75,182.50(.05)
Next year’s deposit = $3,759.13
Third step is to find the Present Value (PV) using this formula
PV = C{[1 / (r– g)] – [1 / (r– g)] × [(1 + g) / (1 + r)]^t}
Let plug in the formula
PV = $3,759.13{[1 / (.09 – .037)] – [1 / (.09 – .037)] × [(1 + .037) / (1 + .09)]^40}
PV = $61,268.57
Now let find the Future value (FV) using this formula
FV = PV(1 + r)^t
Let plug in the formula
FV = $61,268.57(1 + .09)^40
FV = $1,924,410.40
Therefore How much money will you have on the date of your retirement 40 years from today is $1,924,410.40