Answer:
$10,000
Explanation:
Given information:
Archie Hamilton
paid $9,507 for real estates taxes.paid $5,040 for state income taxes withheld in 2019From the information above, it can be referred that;
deductions are allowed up to $10,000 for a combination of State income taxes and Real estate taxes as imposed by the U.S Internal Revenue Service.
In our scenario, the total amount of State income and Real estate taxes deductible on Archie's Form 1040, Schedule A is $10,000 for the year.
Answer:
$5,000
Explanation:
Even though Archie's state income and real estate property taxes are much higher, $9,507 + $5,040 = $14,547, his deductions are capped to only $5,000 per year (he is single) or $10,000 if he was married filing jointly.
The Tax Cuts and Jobs Act limited the amount that you can deduct from state taxes. Before 2018 the deductions were not limited to a certain amount.
Financial markets and _______ channel _______ to_______ . They also channel money from individuals who want to _______ for the future to those who need cash to spend today. A third function of financial markets is to allow individuals and businesses to adjust their risk. For example, _______ , such as the Vanguard Index fund, and _______ , such as SPDR's or "spiders," allow individuals to spread their risk across a large number of stocks. Financial markets provide other mechanisms for sharing risks. For example, a wheat farmer and a baker may use the _______ to reduce their exposure to wheat prices. Financial markets and intermediaries allow investors to turn an investment into cash when needed. For example, the _______ of public companies are _______ because they are traded in huge volumes on the _______ . _______ are the main providers of payment services by offering checking accounts and electronic transfers. Finally, financial markets provide information. For example, the _______ of a company that is contemplating an issue of debt can look at the yields on existing _______ to gauge how much interest the company will need to pay.a. financial intermediaries; b. savings; c. real investments; d. save; e. mutual funds; f. ETFs; g. commodity markets; h. shares; i.liquid; j.stock market; k.banks; l. CFO; m. bonds
Answer:
Financial intermediaries; savings; real investments; save; mutual funds; ETFs; commodity markets; shares; liquid; stock market; banks; CFO; bonds
Explanation:
Financial markets and FINANCIAL INTERMEDIARIES channel SAVINGS to REAL INVESTMENTS . They also channel money from individuals who want to SAVE for the future to those who need cash to spend today. A third function of financial markets is to allow individuals and businesses to adjust their risk. For example, MUTUAL FUNDS, such as the Vanguard Index fund, and ETF( educational trust funds) , such as SPDR's or "spiders," allow individuals to spread their risk across a large number of stocks. Financial markets provide other mechanisms for sharing risks. For example, a wheat farmer and a baker may use the COMMODITY MARKETS to reduce their exposure to wheat prices. Financial markets and intermediaries allow investors to turn an investment into cash when needed. For example, the SHARES of public companies are LIQUID because they are traded in huge volumes on the STOCK MARKET .
BANKS are the main providers of payment services by offering checking accounts and electronic transfers. Finally, financial markets provide information. For example, the CFO of a company that is contemplating an issue of debt can look at the yields on existing BONDS to gauge how much interest the company will need to pay.
Financial markets channel money, allow risk management, provide liquidity and payment services, and offer valuable information.
Explanation:Financial Markets and their Functions
Financial markets play a crucial role in channeling money to individuals, businesses, and governments. They facilitate the transfer of savings from individuals who want to save for the future to those who need cash to spend today. Financial markets also allow investors to adjust their risk by offering various investment options like mutual funds and exchange-traded funds (ETFs). These investment vehicles help individuals spread their risk across a diversified portfolio of stocks.
Additionally, financial markets provide mechanisms for managing risks. For instance, commodity markets enable entities like farmers and bakers to reduce their exposure to price fluctuations by engaging in futures contracts. Furthermore, financial markets and intermediaries such as banks offer liquidity and payment services, allowing investors to convert their investments into cash when needed. Lastly, financial markets provide valuable information to participants. For example, potential bond issuers can assess prevailing market interest rates by examining yields on existing bonds.
Martinez Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $166,900 to $198,400. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 5%, traveling 4%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,300, depreciation on delivery equipment $6,600, and insurance on delivery equipment $1,000.
Prepare a monthly flexible budget for each $11,100 increment of sales within the relevant range for the year ending December 31, 2017.
Answer:
monthly flexible budget for each $11,100 increment
Sales $11,100
Less Sales Commissions ( $11,100 × 6%) ($666)
Net Sales $10,434
advertising ( $11,100 × 5%) ($555)
traveling ( $11,100 × 4%) ($444)
delivery ( $11,100 × 2%) ($222)
Net Income $9,213
Explanation:
Consider Only the incremental costs and revenues.Fixed costs are not relevant for the $11,100 increment
Lawn Spray Inc. develops and produces spraying equipment for lawn maintenance and industrial uses. On January 31 of the current year, Lawn Spray Inc. reacquired 19,600 shares of its common stock at $19 per share. On June 14, 13,700 of the reacquired shares were sold at $25 per share, and on November 23, 4,700 of the reacquired shares were sold at $20.
Required:
A. Journalize the transactions of January 31, June 14, and November 23. Refer to the Chart of Accounts for exact wording of account titles.
B. What is the balance in Paid-In Capital from Sale of Treasury Stock on December 31 of the current year?
C. What is the balance in Treasury Stock on December 31 of the current year?
D. How will the balance in Treasury Stock be reported on the balance sheet?
Answer:
A. The Journal entry is shown below:-
B. $86,900
C.$22,800
Explanation:
The Journal entry is shown below:-
1. Treasury Stock Dr, $372,400
(19,600 shares × $19)
To Cash $372,400
(Being cash is recorded)
2. Cash Dr, $342,500
(13,700 × $25)
To Treasury stock 260,300
(13,700 × $19)
To Paid-In Capital from sale of treasury stock $82,200
(Being cash is recorded)
3. Cash Dr, $94,000
(4,700 × $20)
To Treasury Stock $89,300
(4,700 × $19)
To Paid-In Capital from Sale of Treasury Stock $4,700
(Being reacquired shares is recorded)
B. Balance in Paid-In Capital from Sale of Treasury Stock = $82,200 + $4,700
= $86,900
C. Balance in Treasury Stock = $372,400 - $260,300 - $89,300
= $22,800
zzy Division of Marine Boats Corporation had the following results last year (in thousands). Sales $ 4 comma 700 comma 000 Operating income $ 600 comma 000 Total assets $ 3 comma 600 comma 000 Current liabilities $ 220 comma 000 Management's target rate of return is 12% and the weighted average cost of capital is 5%. What is the Izzy Division's Residual Income (RI)? A. $ 72 comma 000 B. $ 432 comma 000 C. $ 168 comma 000 D. $ 600 comma 000
Answer:
C. $ 168 comma 000
Explanation:
The computation of the residual income is shown below:
= Operating income - minimum return
where,
Operating income is $600,000
And, the minimum return equal to
= Invested asset amount × minimum rate of return
= $3,600,000 × 12%
= $432,000
Now put these values to the above formula
So, the value would equal to
= $600,000 - $432,000
= $168,000
We simply applied the above formula
Assuming that the exchange of Assets A and B has commercial substance, record the exchange for both Culver, Inc. and Larkspur, Inc. in accordance with generally accepted accounting principles. (Round answers to 0 decimal places, e.g. 5,275. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Answer:
Explanation:
Culver, Inc assets
Assets B. 75,000
Accumulated Depreciation
40,000
Asset A96,000
Cash. 15,000. Gain on exchange. 4,000
Larkspur Asset
(Asset B)
Asset A. 60,000. Accumulated Depreciation 47,000.
Cash. 15,000. Asset B. 110,000. Gain on exchange. 12,000. (b) let's say that the exchange of Assets A and B lacks commercial substance, record the exchange for both Culver, Inc. and Larkspur, Inc . in accordance with generally accepted accounting principles.
Culver's Asset (Asset A)
Asset B. 71,000
Accumulated Depreciation
40,000
Asset A.
96,000
Cash. 15,000
Larkspur Asset (Asset B)
Asset A. 50,400
Accumulated Depreciation
47,000
Cash. 15,000
Asset B. 110,000
Gain on exchange. 2,400.
Personal selling: A. Is indirect written communication between buyers and sellers. B. Is indirect spoken communication between buyers and sellers. C. Is not usually combined with other aspects of promotion in the total marketing mix. D. Gets immediate feedback from consumers. E. Is one of the least expensive components of the communications program.
Answer:
The correct answer is letter "D": Gets immediate feedback from consumers.
Explanation:
Personal selling refers to the most traditional type of offering goods and services. It implies having a salesperson in front of a consumer who might be willing to purchase a product. Sellers then, using diverse strategies, try to persuade customers. In some cases, those strategies require clerks to interview the clients to obtain feedback from them and find out what exactly they are looking for. Under such a scenario, salespeople match what the company offer and what consumers want.
Due to evaporation during production, Plano Plastics Company requires 2 pounds of material input for every 1 pounds of good plastic sheets manufactured. During May, the company produced 5,500 pounds of good sheets.
Compute the total standard allowed input quantity, given the good output produced.
The total standard allowed input quantity for the Plano Plastics Company is 11,000 pounds, determined by multiplying the actual output of 5,500 pounds by the required input per pound of output of 2 pounds.
Explanation:The total standard allowed input quantity for the Plano Plastics Company can be computed based on the provided production ratio and actual output. Given that the company requires 2 pounds of material input for every 1 pound of good plastic sheets, and during May the company produced 5,500 pounds of good sheets, we can calculate the input quantity as follows:
Total good output produced: 5,500 poundsRequired input per pound of output: 2 poundsTotal standard allowed input quantity: 5,500 pounds * 2 = 11,000 poundsTherefore, the total standard allowed input quantity of material for the production of 5,500 pounds of good plastic sheets is 11,000 pounds.
Alma and Associates, a new consulting service, recently received a bill for repairs on its computers totaling $2,280. Alma thinks it may have been overcharged and is trying to recreate the components of the bill. She knows the hourly rate is $75 and 15 hours of labor was charged. She also knows $700 of parts were replaced. Compute the material loading charge percentage the repair service used. Material loading charge percentage Type your answer here
Answer:
65%
Explanation:
Alma and Associates
Total repair bill $2,280
Less labor charges (15 hours × $75) $1,125
Total charge for parts $1,155
Less parts cost $700
Cost of loading charge $455
Parts cost $455÷ $700
Loading charge percentage 65%
Final answer:
The material loading charge percentage for the computer repair bill received by Alma and Associates is calculated by subtracting the known labor and parts costs from the total bill and then dividing the resulting material loading charge by the parts cost, yielding a rate of 65%.
Explanation:
The student is trying to compute the material loading charge percentage used in a bill for computer repairs. The total bill is $2,280, the hourly rate for labor is $75, and 15 hours of labor were charged totaling $1,125 in labor costs. Additionally, $700 worth of parts were replaced. To find the material loading charge percentage, we must first subtract the known charges from the total bill.
The calculation is as follows:
Total Bill - (Labor + Parts) = Material Loading Charge
$2,280 - ($1,125 + $700) = $455
Next, we calculate the percentage by dividing the material loading charge by the cost of the parts and then multiplying by 100.
Material Loading Charge Percentage = ($455 / $700) × 100 = 65%
Thus, the repair service used a material loading charge percentage of 65% on top of the parts cost.
Wildhorse Company accumulates the following data concerning a mixed cost, using miles as the activity level. Miles Driven Total Cost Miles Driven Total Cost January 8,000 $14,120 March 8,550 $14,979 February 7,490 13,495 April 8,195 14,490 Collapse question part (a1) Compute the variable cost per mile using the high-low method. (Round answer to 2 decimal places, e.g. 2.25.) Variable cost per mile $
Answer:
Variable cost per unit= $1.4 per unit
Explanation:
Giving the following information:
Miles Driven Total Cost Miles Driven Total Cost
January: 8,000 $14,120
March: 8,550 $14,979
February: 7,490 $13,495
April: 8,195 $14,490
To calculate the variable cost under the high-low method, we need to use the following formula:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (14,979 - 13,495) / (8,550 - 7,490)
Variable cost per unit= $1.4 per unit
Final answer:
The variable cost per mile, calculated using the high-low method with the provided data, is $1.40.
Explanation:
To compute the variable cost per mile using the high-low method, we first identify the months with the highest and lowest activity levels (miles driven). Looking at the data provided, March has the highest activity level with 8,550 miles and a total cost of $14,979, and February has the lowest activity level with 7,490 miles and a total cost of $13,495.
We then apply the high-low method formula:
Variable Cost per Mile = (Cost at High Activity Level - Cost at Low Activity Level) / (High Activity Level - Low Activity Level)
Variable Cost per Mile = ($14,979 - $13,495) / (8,550 miles - 7,490 miles)
Variable Cost per Mile = $1,484 / 1,060 miles
Variable Cost per Mile = $1.40 (rounded to two decimal places)
Therefore, the variable cost per mile is $1.40.
Income Statement Indicating Standard Cost Variances The following data were taken from the records of Griggs Company for December: Administrative expenses $100,800 Cost of goods sold (at standard) 550,000 Direct materials price variance—unfavorable 1,680 Direct materials quantity variance—favorable (560) Direct labor rate variance—favorable (1,120) Direct labor time variance—unfavorable 490 Variable factory overhead controllable variance—favorable (210) Fixed factory overhead volume variance—unfavorable 3,080 Interest expense 2,940 Sales 868,000 Selling expenses 125,000 Prepare an income statement for presentation to management. Enter all amounts as positive numbers except favorable variances. Use a minus sign to indicate favorable variances. Griggs Company Income Statement For the Month Ended December 31 $ $ Unfavorable Favorable Less variance adjustments to gross profit—at standard: $ $ $ Operating expenses: $ $ Other expense: $
Answer and Explanation:
The preparation of the income statement is shown below:
Income statement indicating the cost variances
Particulars Amount Amount Amount
Sales $868,000
Less: Cost of goods
sold -$550,000
Gross profit $318,000
Favorable Unfavorable
Less: Variances from
standard cost
Direct materials price variance $1,680
Direct materials quantity variance $560
Direct labor time variance $490
Variable factory overhead
controllable variance $490
Fixed factory overhead volume variance $3,080 -$3,360
$314,640
Less: Operating expenses:
Administrative expenses $100,800
Selling expenses $125,000 -$225,800
$88,840
Less: Other expenses:
Interest expenses -$2,940
Net income $85,900
Use the following information to prepare the July cash budget for Acco Co. It should show expected cash receipts and cash payments for the month and the cash balance expected on July 31. Beginning cash balance on July 1: $69,000. Cash receipts from sales: 15% is collected in the month of sale, 50% in the next month, and 35% in the second month after sale (uncollectible accounts are negligible and can be ignored). Sales amounts are: May (actual), $1,770,000; June (actual), $1,470,000; and July (budgeted), $1,470,000. Payments on merchandise purchases: 55% in the month of purchase and 45% in the month following purchase. Purchases amounts are: June (actual), $560,000; and July (budgeted), $650,000. Budgeted cash payments for salaries in July: $400,000. Budgeted depreciation expense for July: $13,000. Other cash expenses budgeted for July: $200,000. Accrued income taxes due in July: $90,000. Bank loan interest paid in July: $7,500.
Answer:
Acco Co's Cash Budget for July
Beginning cash balance on July 1, - $69,000
add a) Expected Cash Receipts for July:
May Sales = 35% x $1,770,000 - $619,500
June Sales = 50% x $1,470,000 - $735,000
July Sales = 15% x $1,470,000 - $220,500
Totaling $1,575,000
less b) Expected Cash Payments for July:
June Purchases = 45% x $560,000 - $252,000
July Purchases = 55% x $650,000 - $357,500
Salaries = $400,000
Other Cash Expenses = $200,000
Accrued Income Taxes = $90,000
Bank Loan Interest = $7,500
Totalling - $1,307,000
Expected Cash balance on July 31 = $337,000 $(69,000 +1,575,000 - 1,307,000)
Explanation:
The accrued income taxes that are due in July must be included in the cash payments since they are expected.
Depreciation expense does not involve a cash payment. It does not appear in cash budgets.
On April 12, Hong Company agrees to accept a 60-day, 6%, $6,900 note from Indigo Company to extend the due date on an overdue account. What is the journal entry that Indigo Company would make, when it records payment of the note on the maturity date
Answer:
Debit notes Payable $6,900
Debit interest expense $69
Credit cash $6,969
Explanation:
The interest amount payable on maturity is $6900*6%*2/12=$69
The actual principal remains at $6900
The appropriate entries would to debit notes payable with $6,900 and interest expense with $69 while the credit of $6969 goes to cash account representing an outflow to settle the obligation.
The rationale for this is that settle of an obligation would require debit the payable account.
The journal entry that Indigo Company would make,when it records payment of the note on the maturity is: Debit Notes Payable $7,500; credit Interest Expense $125; credit Cash $7,375. The correct option is C.
A journal entry is a record of a financial transaction in a company's accounting system. It is formatted in a specified way and includes the transaction date, the accounts involved, the sums debited or credited, and a brief description or explanation of the transaction.
The double-entry bookkeeping method is built on journal entries, which guarantee that the accounting formula (Assets = Liabilities + Equity) is accurate and balanced.
Thus, the ideal selection is option C.
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The complete question might be:
On April 12, Hong Company agrees to accept a 60-day, 6%, $6,900 note from Indigo Company to extend the due date on an overdue account. What is the journal entry that Indigo Company would make, when it records payment of the note on the maturity date? (Use 360 days a year.)A) Debit Cash $7,625; credit Interest Revenue $125; credit Notes Payable $7,500.B) Debit Notes Payable $7,500; debit Interest Expense $188; credit Cash $7,688.C) Debit Notes Payable $7,500; credit Interest Expense $125, credit Cash $7,375.D) Debit Notes Payable $7,500; debit Interest Expense $125; credit Cash $7,625.E) Debit Cash $7,625; credit Interest Revenue $125; credit Notes Receivable $7,500.
Pursuant to a complete liquidation in the current year, Scarlet Corporation distributes to Jake land (basis of $425,000, fair market value of $390,000) that was purchased three years ago and held as an investment. The land is subject to a liability of $250,000. Jake, who owned 35% of the Scarlet Corporation shares outstanding, had a basis of $60,000 in the stock. What are the tax consequences of the liquidating distribution to Scarlet Corporation and to Jake?
Answer:
The Long-term capital gain (Jake recognize) = $80,000
However, the Jake considered the basis of $390,000 (Land).
Explanation:
From the questions given we find the following,
What are the consequences of tax for the distribution liquidating to Jake and Scarlet Corporation
Then,
The Long-term capital loss (Scarlet Corporation recognize) = Fair market value - Basis
The Long-term capital loss (Scarlet Corporation recognize) = $390,000 - $425,000
The Long-term capital loss (Scarlet Corporation recognize) = $35,000
The Long-term capital gain (Jake recognize) = (Fair market value of land - Liability) - Basis of stock
The Long-term capital gain (Jake recognize) = ($390,000 - $250,000) - $60,000
The Long-term capital gain (Jake recognize) = $80,000
However, the Jake considered the basis of $390,000 (Land).
Final answer:
Scarlet Corporation recognizes a $35,000 loss on the distribution of land, while Jake recognizes an $80,000 gain and retains a $390,000 basis in the land post-distribution.
Explanation:
The tax consequences of the liquidating distribution to both Scarlet Corporation and Jake involve recognizing gains and losses and determining the new basis in the distributed asset. Scarlet Corporation will recognize a loss on the distribution of the land, since the fair market value (FMV) is less than its basis: $390,000 FMV less the $425,000 basis equals a $35,000 loss. But this loss may be limited due to tax regulations concerning losses on distributions to related parties. For Jake, he must first determine the amount of the distribution. The amount of the distribution is the FMV of the land less the liability assumed, so $390,000 - $250,000 equals $140,000. Since Jake’s basis in the stock is $60,000, he would recognize a gain of $80,000 ($140,000 distribution - $60,000 basis). His basis in the land post-distribution would then be the FMV of the land, which is $390,000.
On December 31, Patterson Company had the following list of account balances.
Accounts Payable $42,300
Dividends $17,300
Accounts Receivable 44,000
Equipment 50,800
Accumulated Depreciation, Buildings 63,900
Prepaid Rent 14,700
Accumulated Depreciation, Equipment 10,700
Rent Expense 11,000
Beginning Retained Earnings 31,100
Salaries Expense 6,100
Buildings 119,000
Salaries Payable 8,900
Capital Stock 57,000
Service Revenue 121,600
Cash 39,900
Supplies 10,800
Depreciation Expense, Buildings 8,300
Supplies Expense 9,000
Depreciation Expense, Equipment 4,600
Required:
Prepare a balance sheet on December 31.
Answer:
Patterson Company
Balance sheet as at December 31
Fixed Assets:
Equipment $50,800
Less: Accumulated Depreciation, Equipment $10,700
Buildings $119,000
Less: Accumulated Depreciation, Buildings $63,900
Total Fixed Assets $95,200
Current Assets:
Accounts Receivable $44,000
Prepaid Rent $14,700
Cash $39,900
Supplies $10,800
Total current Assets $109,400
Current Liabilities:
Accounts Payable $42,300
Salaries Payable $8,900
Total current liabilities $51,200
Total Net Assets = $153,400
Shareholders Equity:
Capital Stock $57,000
Retained earnings $96,400
Shareholders equity $153,400
Income statement.
Service Revenue 121,600
Supplies Expense 9,000
Gross Profit 112,600
Less expenses:
Depreciation Expense, Equipment 4,600
Depreciation Expense, Buildings 8,300
Rent Expense 11,000
Salaries Expense 6,100
Net income $82,600
Dividends $17,300
Transfer to retain earnings $65,300
Beginning Retained Earnings 31,100
Closing retained earnings $96,400
The Shoal Company's manufacturing costs for the third quarter of 2019 were as follows: (CPA adapted) Direct materials and direct labor $ 770,000 Other variable manufacturing costs 135,000 Depreciation of factory building and manufacturing equipment 87,000 Other fixed manufacturing costs 25,000 What amount should be considered product costs for external reporting purposes?
Answer: $1,017,000
Explanation:
In calculating product costs we take the following, Direct materials and direct labor, Other variable manufacturing costs, Depreciation of factory building and manufacturing equipment and Other fixed manufacturing costs.
We add all of those with the result being the Product cost.
Calculating therefore would give us,
= 770,000 + 135,000 + 87,000 + 25,000
= $1,017,000
$1,017,000 is the amount that should be considered product costs for external reporting purposes.
If you need any clarification do comment.
The product costs for external reporting purposes in the Shoal Company's manufacturing costs for the third quarter of 2019 include direct materials, direct labor, other variable manufacturing costs, and depreciation of factory building and manufacturing equipment.
Explanation:The product costs for external reporting purposes in the Shoal Company's manufacturing costs for the third quarter of 2019 include direct materials, direct labor, other variable manufacturing costs, and depreciation of factory building and manufacturing equipment. These costs are considered product costs because they directly relate to the production of goods.
Therefore, the product costs for external reporting purposes would be:
Direct materials and direct labor: $770,000 Other variable manufacturing costs: $135,000 Depreciation of factory building and manufacturing equipment: $87,000The total product costs for external reporting purposes would be $992,000.
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Diana Mark is the president of ServicePro, Inc., a company that provides temporary employees for not-for-profit companies. ServicePro has been operating for five years; its revenues are increasing with each passing year. You have been hired to help Diana in analyzing the following transactions for the first two weeks of April:
a. April 2 Purchased office supplies for $500 on account.
b. April 5 Billed the local United Way office $1,950 for temporary services provided.
c. April 8 Paid $250 for supplies purchased and recorded on account last period.
d. April 8 Placed an advertisement in the local paper for $400 cash; the ad will run in May.
e. April 9 Purchased a new computer for the office costing $2,300 cash.
f. April 10 Paid employee wages of $1,200. Of this amount, $200 had been earned by employees in the prior period and already recorded in the Wages Payable account.
g. April 11 Received $1,000 on account from the local United Way office (from [b] above).
h. April 12 Purchased land as the site of a future office for $10,000. Paid $2,000 down and signed a note payable for the balance.
i. April 13 Received $80,000 cash as additional investment by owner Diana Mark.
j. April 14 Billed Family & Children’s Service $2,000 for services rendered this month.
k. April 15 Received the April telephone bill for $245 to be paid next month.
Required:
For each transaction, prepare a journal entry. If no entry is needed, explain why. Be sure to categorize each account as an asset (A), liability (L), owner’s equity (OE), revenue (R), or expense (E).
Answer:
a.
Purchased office $500 (debit)
Trade Payable $500 (credit)
b.
Trade Receivable : local United Way $1,950 (debit)
Revenue$1,950 (credit)
c.
Trade Payable $250 (debit)
Cash $250 (credit)
d.
Advertisement Prepaid $400 (debit)
Cash $400 (credit)
e.
Computer $2,300 (debit)
Cash $2,300 (credit)
f.
Wages Payable $200 (debit)
Wages Expense $1,000 (debit)
Cash $1,200 (credit)
g.
Cash $1,000 (debit)
Trade Receivable - local United Way office $1,000 (credit)
h.
Land $10,000 (debit)
Cash $2,000 (credit)
Note Payable $8,000 (credit)
i.
Cash $80,000 (debit)
Capital $80,000 (credit)
j.
Trade Receivables$2,000 (debit)
Revenue$2,000 (credit)
k.
Telephone expense $245 (debit)
Payable $245 (credit)
Explanation:
Record the Journals considering the Accounting Equation
Assets = Liabilities + Equity
An entity purchased US $1 .000 gross amount of inventory on account with terms of 2 f discount if paidwithin 10 days. The seller was responsible for delivery to the shipping point, with freight of US $30 prepaidby the seller. The entity records purchases at the net amount. The journal entry to record payment 8 daysafter the invoice date is ___________.
Answer:
The answer is given below;
Explanation:
on FOB shipping point,the freight is responsibility of the buyer.If it is paid by the seller,the buyer will compensate to the seller.
As the buyer had already recorded purchases on net of discount,therefore the entry will be;
Accounts Payable (1*.98) Dr.$30.98
Cash Cr.$30.98
It is assumed that freight was previously recorded by the buyer as payable to the seller .
"Which of the following statements is FALSE? A. Total return equals earnings multiplied by the dividend payout rate. B. Cutting the firm's dividend to increase investment will raise the stock price if, and only if, the return of new investments is higher than the cost of capital. C. As firms mature, their earnings exceed their investment needs and they begin to pay dividends. D. We cannot use the constant dividend growth model to value the stock of a firm with rapid or changing growth."
Answer:
A. Total return equals earnings multiplied by the dividend payout rate.
Explanation:
The payout ratio is a financial metric that shows the proportions of the earnings a company pays the shareholders in the forms of dividends. They are expressed as a percentage of the total earnings and some occasion refers top the percentage of the cash flows. Thus is called the dividend payment ratio. And is calculated by the dividend payout ratio equal to the total dividend upon the net income asDPR = Total dividends ÷ Net income.
It shows the company's earnings paid out as dividends to shareholders. A low payout ratio means a signal that the company is reinvesting bulk earnings into the expanding operations.Which of these statements about reverse logistics is BEST? A. Reverse logistics systems are usually more cost-efficient than forward-based systems. B. Reverse logistics systems are usually designed to be more flexible than forward-based systems. C. Reverse logistics systems usually play no role in customer satisfaction. D. Reverse logistics systems usually use the same processes and players that comprise the forward-based system.
Final answer:
The best statement about reverse logistics is that they are designed to be more flexible than forward-based systems, due to the variability and uncertainty in handling returns, remanufacturing, and recycling among others.
Explanation:
The question asks which statement about reverse logistics is best. Among the options provided, the most accurate assertion is that reverse logistics systems are usually designed to be more flexible than forward-based systems. Unlike forward logistics that primarily focuses on the efficient delivery of goods from manufacturers to end-users, reverse logistics involves the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal.
This includes activities such as returns management, remanufacturing, refurbishing, recycling, and even hazardous waste disposal. Reverse logistics systems need to be flexible to accommodate the uncertainty and variability inherent in these processes. While cost efficiency, customer satisfaction, and process similarities to forward logistics are all relevant considerations, the core characteristic that sets reverse logistics apart is its requirement for adaptability to manage a wide variety of return conditions and channels.
Cadilengy, a nonprofit organization, is conducting a food fair in the month of October. The proceeds of this fair will go to charity. The restaurants and food product companies participating in the fair start distributing pamphlets about the fair in their outlets two months before the event. As a result, the fair gained popularity among the public. Which of the following marketing strategies does this scenario best illustrate?
a. Event Marketing
b. Public Marketing
c. Online Marketing.
d. None of these
Answer: (A) Event marketing
Explanation:
The event marketing is one of the business promotional strategy in which the various types of brands, products and the services are get promoted in the market so that the customers or users are get aware about the specific brand and the new products.
According to the given question, the Event marketing is one of the type of strategy that best illustrating the given scenario about a non profit organization is conduct a food fair and the collected fair is basically contributed for the charity purpose.
On the other hand, along with charity the various types of restaurants distribute their pamphlets and promote their restaurants business in the event. Therefore, Option (A) is correct answer.
Quantum is planning on merging with Reliant Energy. Quantum currently has 80,000 shares of stock outstanding at a market price of $32.60 a share. Reliant Energy has 50,000 shares outstanding at a price of $24.50 a share. The merger will create $450,000 of synergy. How many of its shares should Quantum offer in exchange for all of Reliant Energy s share if it wants its acquisition cost to be $1,443,000?
Answer:
The multiple choices are:
a.44,172
b.43,109
c.42,377
d.40,648
e.41,205
Option D,40,648 is the correct option
Explanation:
The number of shares to offer to Reliant energy would be the acquisition cost divided Quantum post acquisition share price
The share price can be computed thus:
Market of Reliant =$24.50*50,000=$1,225,000
Market value of Quantum=$32.60*80,000=$2,608,000
Reliant is now worth(acquisition cost) =$1,443,000
Reliant shareholders' share of synergy=$1,443,000-$1,225,000=$218,000
Remnant of synergy left for Quantum=$450,000-$218,000=$232,000
Share price of Quantum post merger=($2,608,000+$232,000)/80,000=$35.5
Number of shares to issue to Reliant=$1,443,000/$35.5=40,648 shares
Calculating how much Quantum should pay for Reliant Energy involves additional steps. First, we need to calculate the total value of Reliant Energy. Next, we subtract the synergy from Quantum's desired acquisition cost. This amount is then divided by the current market price of Quantum's shares to find out how many shares Quantum needs to offer.
Explanation:To calculate how many shares Quantum should offer in exchange for all of Reliant Energy's shares, we first need to find the value of Reliant Energy. This can be done by multiplying the number of outstanding shares by their market price. Therefore, the total value of Reliant Energy is 50,000 x $24.50 = $1,225,000.
Quantum wants its acquisition cost to be $1,443,000, but since the merger creates $450,000 of synergy, Quantum needs to subtract this synergy from its desired acquisition cost to find out how much it should pay for Reliant Energy. Therefore, Quantum should offer $1,443,000 - $450,000 = $993,000 for all of Reliant Energy's shares.
Since Quantum's shares currently trade at $32.60 per share, the number of Quantum shares to offer for all of Reliant's shares would be $993,000 / $32.60 = approximately 30457 shares.
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A small producer of machine tools wants to move to a larger building, and has identified two alternatives. Location A has annual fixed costs of $210,000 and variable costs of $16,000 per unit; location B has annual fixed costs of $410,000 and variable costs of $12,000 per unit. The finished items sell for $22,000 each.
Required:
a. At what volume of output would the two locations have the same total cost?
b. For what range of output would location A be superior?
c. For what range would B be superior?
Answer:
a)
Indifference point = Difference in fixed costs / Difference in variable cost per unit
= ($410,000 - $210,000) / ($16,000 - $12,000)
= 50 units.
b) and C)
I have selected 49 units for calculation as at 50 units, both locations are indifferent.
units 49 49
Location A Location B
Sales 1,078,000 1,078,000
Less: Variable costs 784,000 588,000
Contribution 294,000 490,000
Less: Fixed Costs 210,000 410,000
Profit 84,000 80,000
As we can find, at 49 units, Location A gives more profits than Location B.
So, till 50 units, location A should be used and after 50 units location B should be used.
Explanation:
A small producer of machine tools wants to move to a larger building, and has identified two alternatives is :
A) The volume of output would the two locations have the same total cost is 50 units.
B) As we can find, at 49 units, Location A gives more profits than Location B.
C) So, till 50 units, location A should be used and after 50 units location B should be used.
"Total Cost"Answer A:
The volume of output would the two locations have the same total cost is :
Formula:
Indifference point = Difference in fixed costs / Difference in variable cost per unit
Indifference point= ($410,000 - $210,000) / ($16,000 - $12,000)
Indifference point= 50 units.
The volume of output would the two locations have the same total cost is 50 units.
Answer B:
I have selected 49 units for calculation as at 50 units, both locations are indifferent.
Location A Location B
Sales 1,078,000 1,078,000
Less: Variable costs 784,000 588,000
Contribution 294,000 490,000
Less: Fixed Costs 210,000 410,000
Profit 84,000 80,000
As we can find, at 49 units, Location A gives more profits than Location B.
Answer C:
So, till 50 units, location A should be used and after 50 units location B should be used.
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Your next client is a retailer of ready-to-assemble furniture. He’s sent you the following report: Easy Lifestyle Furniture Popular ready-to-assemble bedroom, living room, and office furniture. Three store locations in the state as well as online sales. Product line has been on the market for 2 years. Sales are steady, but untapped sales potential exists. Heavy marketing efforts have already taken place. Pricing is at or near market prices for competitors’ products. What should you recommend to increase sales? Select an option from the choices below and click Submit.
Answer:
Keep price the same but provide additional services such as free delivery and financing option.
Explanation:
On a critical evaluation of the report, it is apparent that easy lifestyle furniture products come with some strength that the retailer can build on to utilize the untapped sales potential.
Adding extra features through innovation (product development) to the furniture will help in driving a sales growth considering the fact that the sales is already steady.
Providing additional services such as free delivery and financing option , at the current price rate can motivate and attract new customers.
Final answer:
To boost sales for a furniture retailer, recommend a thorough market analysis to discover new customer segments, optimize store layout and online product visibility, and analyze distribution for efficiency. Companies like IKEA demonstrate the effectiveness of employee involvement and optimized store layout.
Explanation:
Recommendations to Increase Sales for a Furniture Retailer
To increase sales for a retailer of ready-to-assemble furniture with steady sales and untapped potential, I recommend conducting a deep market analysis to identify untapped customer segments and enhance product visibility. First, conduct research to define the demographics of potential customers who may not have been reached by previous marketing efforts. Consider aspects such as age, profession, economic status, and geographic location.
Next, evaluate the store's product placement within physical locations and its online presence. Consider how to optimize the visibility and convenience for consumers, which could involve reevaluating the store layout or improving online product categorization. The success of companies like IKEA suggests that encouraging employee involvement and ownership can improve the in-store experience and customer service.
Lastly, analyze the distribution channels for the furniture. Whether it's in-store, online, or through mail, optimizing these channels can enhance customer reach and satisfaction. Additionally, measure the productivity of floor space to ensure that the most profitable products get the best positioning while minimizing costs.
The following costs relate to Salad Box Company for a relevant range of up to 10,000 units annually: Variable Costs: Direct materials $1.25 Direct labor 0.75 Manufacturing Overhead 1.00 Selling and administrative 1.00 Fixed Costs: Manufacturing overhead $20,000 Selling and Administrative 10,000 Salad Box sells each unit for $10.00. Which of the following equations best describes the equation to determine total profit for a sales volume of 8,000 units
Select one: A. Profit = $10.00X – ($30,000 + $5.50X) B. Profit = $30,000 + $5.50X C. Profit = $10X D. Profit = $10.00X – ($10,000 – $4.50X)
Answer:
Equations best describes the equation to determine total profit for a sales volume: Total profit = $10.00X – ($4X + $30,000)
Explanation:
Total variable costs to produce 1 units = Direct materials + Direct labor + Manufacturing Overhead + Selling and administrative = $1.25 + $0.75 + $1.00 + $1.00 = $4 per unit
Fixed Costs = Manufacturing overhead + Selling and Administrative = $20,000 + $10,000 = $30,000
Box sells each unit for $10.00. X is the number of units are sold
Total profit = Sales revenue - (Total variable costs + Fixed Costs) = $10.00X – ($4X + $30,000)
Final answer:
The correct equation to determine the total profit for Salad Box Company at a sales volume of 8,000 units is option A, which accounts for both variable and fixed costs subtracted from the total sales revenue.
Explanation:
The equation to determine total profit for a sales volume of 8,000 units for the Salad Box Company can be derived from the given cost structure and sales price. Total profit is calculated by subtracting total costs from total sales revenue, where total costs are the sum of fixed and variable costs, and total sales revenue is the sales price per unit times the number of units sold.
Therefore, the equation incorporating the costs (fixed costs plus variable costs per unit times the number of units) and revenues (sales price per unit times the number of units) is:
Profit = ($10.00 × number of units sold) – (Fixed Costs + (Variable Costs per unit × number of units sold))
For Salad Box, this translates to:
Profit = ($10.00 × X) – ($30,000 + $4.00 × X) where X represents the number of units sold
Thus, the correct equation from the given options is A. Profit = $10.00X – ($30,000 + $5.00X).
Assume that a parent company acquired 80% of the outstanding voting common stock of a subsidiary on January 1, 2012. On the acquisition date, the identifiable net assets of the subsidiary had fair values that approximated their recorded book values except for a patent, which had a fair value of $100,000 and no recorded book value. On the date of acquisition, the patent had 5 years of remaining useful life and the parent company amortizes its intangible assets using straight line amortization. During the year ended December 31, 2013, the subsidiary recorded sales to the parent in the amount of $105,000. On these sales, the subsidiary recorded pre-consolidation gross profits equal to 25%. Approximately 30% of this merchandise remains in the parent's inventory at December 31, 2013. The following summarized pre-consolidation financial statements are for the parent and the subsidiary for the year ended December 31, 2013: Investor Investee Income statement: Revenues $2,400,000 $321,000 Equity income 106,500 0 Expenses (1,600,000) (160,000) Net income $906,500 $161,000 Retained earnings statement: BOY retained earnings $752,000 $40,000 Net income 906,500 161,000 Dividends declared (64,000) (40,000) EOY retained earnings $1,594,500 $161,000 Balance sheet: Current assets $800,000 $101,000 Equity investment 234,500 - Noncurrent assets 4,000,000 300,000 Total assets $5,034,500 $401,000 Liabilities $2,640,000 $160,000 Common stock & APIC 800,000 80,000 Retained earnings 1,594,500 161,000 Total liabilities & stockholders' equity $5,034,500 $401,000 Based on this information, determine the balance for Noncontrolling Interest: $32,200 $58,625 $24,100 $18,625
Answer:
consolidation financial statements are for the parent and the subsidiary for the year =$ 1682,875
Explanation:
Final answer:
The balance for Noncontrolling Interest is calculated by adding the noncontrolling interest's share of the subsidiary's net income to their share of the patent's excess fair value amortization. However, the result does not match the options provided in the question.
Explanation:
To determine the balance for Noncontrolling Interest after the parent company has acquired 80% of the subsidiary, we need to calculate the noncontrolling interest's share of the subsidiary's net income and add the excess fair value amortization for the patent.
The subsidiary's net income is $161,000. The parent company owns 80%, so the noncontrolling interest owns the remaining 20%. Therefore, 20% of the subsidiary's net income attributable to the noncontrolling interest is $32,200 ($161,000 * 0.2).
We must also consider the excess fair value of the patent that was amortized. The patent had a fair value of $100,000 and a remaining useful life of 5 years at the acquisition date, meaning it would be amortized at $20,000 per year ($100,000 / 5). Two years of amortization have occurred by the end of 2013, thus the total amortization is $40,000. The noncontrolling interest's share of that amortization is $8,000 ($40,000 * 0.2).
The balance for the Noncontrolling Interest at the end of 2013 is the sum of the noncontrolling interest share of the net income and their share of the patent amortization, which is $32,200 + $8,000 = $40,200. This wasn't one of the provided possible answers, suggesting there may be an error in the question, or additional information is needed for accuracy.
Working capital cash flow. Cool Water, Inc. sells bottled water. The firm keeps in inventory plastic bottles at 11% of the monthly projected sales. These plastic bottles cost $0.007 each. The monthly sales for the first four months of the coming year are as follows: January: 1 comma 900 comma 000 February: 2 comma 300 comma 000 March: 2 comma 900 comma 000 April: 3 comma 000 comma 000 What is the monthly increase or decrease in cash flow for inventory given that an increase is a use of cash and a decrease is a source of cash? Note: Enter a decrease as a negative number. What is the change in working capital for January?
Answer:
The answer is attached;
Explanation:
The stockholders’ equity section of Bramble Corp.’s balance sheet at December 31 is presented here.
BRAMBLE CORP.
Balance Sheet (partial)
Stockholders’ equity
Paid-in capital
Preferred stock, cumulative, 12,500 shares authorized, 7,500 shares issued and outstanding $ 787,500
Common stock, no par, 735,000 shares authorized, 565,000 shares issued 2,260,000
Total paid-in capital 3,047,500
Retained earnings 1,158,000
Total paid-in capital and retained earnings 4,205,500
Less: Treasury stock (6,900 common shares) 36,800
Total stockholders’ equity $4,168,700
(a) How many shares of common stock are outstanding?
(b) Assuming there is a stated value, what is the stated value of the common stock?
(c) What is the par value of the preferred stock?
(d) If the annual dividend on preferred stock is $47,250, what is the dividend rate on preferred stock?
(e) If dividends of $73,800 were in arrears on preferred stock, what would be the balance reported for retained earnings?
Answer:
Common stock outstanding is 558,100
Stated value of common stock is $4.00 per share
Par value of preferred stock is $105 per share
Dividend rate on preferred stock is 6%
The arrears of $73,800 would not impact the retained earnings,they are to be declared before the impact is felt in retained earnings.
Explanation:
Common stock outstanding =issued common stock -treasury stock
=565,000-6,900
==558,100
Stated value of common stock=value of shares issued/shares issued
=$2,260,000/565,000
=$4.00 per share
Par value of preferred stock=value of shares issued/shares issued
=$787,500/7500
=$105 per share
preferred dividends=Preferred share capital *Dividend rate on preferred stock
preferred dividends is $47,250
preferred share capital is $787,500
dividend rate on preferred stock is unknown
$47,250=$787,500*Dividend rate on preferred stock
Dividend rate on preferred stock=$47,250/$787,500
=6%
The arrears of $73,800 would not impact the retained earnings,they are to be declared before the impact is felt in retained earnings.
The answers to all the parts of the question are as follows:
a) Common stock outstanding is 558,100
b) Stated value of the common stock is $4 per share
c) Par value of the preferred stock is $105 per share
d) Dividend rate is 6%
e) The arrear of $73,800 will not affect the balance of retained earnings recorded under the balance sheet.
Computations:
a) The shares of common stock outstanding are:
[tex]\begin{aligned}\text{Outstanding Common stock}&=\text{Common stock issued}-\text{Treasury stock}\\&=565,000-6,900\\&=558,100 \end{aligned}[/tex]
b) Stated value of the common stock:
[tex]\begin{aligned}\text{Stated Value of common stock}&=\frac{\text{Total value of shares issued}}{\text{Common stock issued}}\\&=\frac{\$2,260,000}{565,000}\\&=\$4\;\text{per share} \end{aligned}[/tex]
c) Par value of the preferred stock:
[tex]\begin{aligned}\text{Par value of preferred stock}&=\frac{\text{Total value of shares issued}}{\text{Preferred Shares issued}}\\&=\frac{\$7,87,500}{7,500}\\&=\$105\;\text{per share} \end{aligned}[/tex]
d) Annual dividend rate on preferred stock:
[tex]\begin{aligned}\text{Dividend rate on preferred stock}&=\frac{\text{Preferred dividend}}{\text{Preferred share capital}}\\&=\frac{\$47,250}{\$787,500}\times100\\&=6\% \end{aligned}[/tex]
e) Any amount of preferred dividend whose amount is under arrears then will not affect the balances reported for the retained earnings, this is because the amount of arrear of dividend is already under the note with the balance sheet.
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On April 1, Jackson Company purchased $2,440 of supplies on account. On April 1, Jackson Company debited Supplies Expense, which is an alternate way of recording the initial expenditure. By the end of the calendar year, $390 of supplies was used.
Required:
Journalize the adjusting entry on December 31.
Answer:
The answer is given below;
Explanation:
Supplies (2,440-390) Dr.$2,050
Supplies Expense/Retained Earnings Cr.$2,050
The correct entry on April 1 should have been
Supplies Dr.$2,440
Accounts Payable Cr.$2,440
But erroneously instead of debiting supplies,the supplies expense was debited and as result supplies expense was overstated and supplies understated.The entry made was;
Supplies expense Dr.$2,440
Accounts Payable Cr.$2,440
As at December 31, $390 supplies have been expense out,therefore by the difference amount (2,440-390),the expense and supplies will be reinstated to their actual values
Turney Company produces and sells automobile batteries, the heavy-duty HD-240. The 2017 sales forecast is as follows. Quarter HD-240 1 5,200 2 7,150 3 8,320 4 10,190 The January 1, 2017, inventory of HD-240 is 2,080 units. Management desires an ending inventory each quarter equal to 40% of the next quarter’s sales. Sales in the first quarter of 2018 are expected to be 25% higher than sales in the same quarter in 2017. Prepare quarterly production budgets for each quarter and in total for 2017.
Answer:
Q1 Production 5,980 batteries
Q2 Production 7,618 batteries
Q3 Production 9,068 batteries
Q4 Production 8,714 batteries
Total production for the year is 31,380
Explanation:
Turney Company 2017 Quarterly Production Budgets
Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018
Sales 5,200 7,150 8,320 10,190 6,500*
Opening inventory (2,080) (2,860) (3328 ) (4076) (2600)
Closing inventory 2,860 3328 4076 2600 -
Production required 5,980 7,618 9,068 8,714
Sales in Q1 2018=Q1 2017*(1+25%)
Q1 2017 Sales is 5,200
sales in Q1 2018=5,200*(1+25%)
=5,200*(1+0.25)
=5,200*1.25
=$6500*
Sample calculation of closing inventory=40%*next quarter's sales
Q1 2017 closing inventory =7150*40%=2860
Q 2 2017 closing inventory =8320*40%=3328
Q 3 2017 closing inventory =10190*40%=4076
Q 4 2017 closing inventory =6,500*40%=2600
Total production for the year =5980+7618+9068+8714
=31,380
The calculation of WACC involves calculating the weighted average of the required rates of return on debt, preferred stock, and common equity, where the weights equal the percentage of each type of financing in the firm’s overall capital structure. is the symbol that represents the before-tax cost of debt in the weighted average cost of capital (WACC) equation. Avery Co. has $1.4 million of debt, $1.5 million of preferred stock, and $2.1 million of common equity. What would be its weight on common equity? 0.42 0.28 0.33 0.27
Answer:
The weightage of common equity will be 0.42
Explanation:
The weight of each component of financing to the firm is calculated by taking the market value of each component and dividing it by the total market value of the assets of the firm. Where assets = debt + equity
The total assets or value of capital structure for the firm is,
Assets = 1.4 + 1.5 + 2.1 = $5 million
The weightage of common equity in the capital structure is, 2.1 / 5 = 0.42 or 42%
The weight of common equity is computed by dividing the amount of common equity by the total financing. Avery Co.'s weight of common equity is 0.42.
Explanation:In the calculation of the weighted average cost of capital (WACC), the weight of common equity refers to the proportion of funding that a firm gets from common equity or common shares relative to its total financing. Given the data, we can calculate the weight of common equity by dividing the amount of common equity ($2.1 million) by the total amount of funding which is the sum of debt ($1.4 million), preferred stock ($1.5 million), and common equity ($2.1 million). Therefore, the weight of common equity for Avery Co. would be calculated as follows: Weight of Common Equity = Common Equity / (Debt + Preferred Stock + Common Equity) = $2.1 M / ($1.4 M + $1.5 M + $2.1 M) = 0.42. So the correct answer is 0.42.
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