Answer:
Net cash provided by operating activities is 149.000
Explanation:
The indirect method involves the adjustment of net income with changes in balance sheet accounts to arrive at the amount of cash generated by operating activities.
First we have to see if each account increase o decrease by resting value of year 1 to the year 2
Decrease/ Increase =year 2 - year 1
For example Accounts payable
year 1 $5,000
year 2 $4,000
Accounts payable decrease 1000 ($4,000-$5,000 )
Once we have this information we make the adjustments.
It depends on the account if it is added or subtracted to net income. Below you will find the added account with a plus (+) and the subtracted ones with a minus (-)
Notice the amounts of any decreases are in parentheses.
Net income 120.000
Adjustment to reconcile the net income to cash
- Decrease in accounts payable (1.000)
+ Depreciation expense 20000
+ Decrease Prepaid expenses 5.000
+ Decrease in Fixed assets 32.400
Net cash 149.000
On January 1 of the current year, Chuy Company paid $ 1 comma 800 in rent to cover six months (January - June). Chuy recorded this transaction as follows: LOADING...(Click the icon to view the transaction.) Chuy's adjusting entry at the end of February included a debit to Rent Expense in the amount of $ 300. What effect does the adjusting entry have on Chuy's net income for February? A. Net income will increase by $ 300 B. Net income will decrease by $ 600 C. Net income will decrease by $ 300 D. Net income will increase by $ 600
Answer:
C. Net income will decrease by $ 300
Explanation:
rent expense 300 debit
prepaid rent 300 credit
the entry decrease the prepaid expense (asset) and recognize the accrued expense for the period (rent of February)
As this entry recognzie an expense, the net income decreases by this amount as it decrases the net proceeds from revenues
Schwert Corp. shows the following information on its 2019 income statement: sales = $235,000; costs = $147,000; other expenses = $7,900; depreciation expense = $17,500; interest expense = $13,500; taxes = $17,185; dividends = $10,500. In addition, you’re told that the firm issued $5,000 in new equity during 2019 and redeemed $3,500 in outstanding long-term debt. (Do not round intermediate calculations.) a. What is the 2019 operating cash flow? b. What is the 2019 cash flow to creditors? c. What is the 2019 cash flow to stockholders? d. If net fixed assets increased by $20,000 during the year, what was the addition to net working capital (NWC)?
Answer:
a. $62,915
b. $17,000
c. $5,500
d. $2,915
Explanation:
a. The operating cash flow is shown below:
= EBIT + Depreciation - Income tax expense
where,
EBIT = Sales - cost of good sold - other expenses - depreciation expense
= $235,000 - $147,000 - $7,900 - $17,500
= $62,600
And all other items would remain same
Now put these values to the above formula
So, the value would equal to
= $62,600 + $17,500 - $17,185
= $62,915
b. The computation of the cash flow to creditors is shown below:
= Interest expense - ending balance of long term debt + beginning balance of long term debt
= $13,500 - (-$3,500)
= $17,000
c. The computation of the cash flow to stockholder is shown below:
= Dividend expense - new equity
= $10,500 - $5,000
= $5,500
d. Computation of the addition to the net working capital is shown below:
The computation of the cash flow from assets = cash flow to creditors + cash flow to stockholders
= $17,000 + $5,500
= $22,500
Now addition to NWC = Operating cash flow - cash flow from assets - net capital spending
= $62,915 - $22,500 - ($20,000 + $17,500)
= $2,915
Inventory records for Dunbar Incorporated revealed the following:
Date Transaction Number ofUnits Unit Cost
Apr. 1 Beginning inventory 500 $2.13
Apr. 20 Purchase 310 2.63
Dunbar sold 620 units of inventory during the month. Ending inventory assuming LIFO would be (Do not round your intermediate calculations. Round your answer to the nearest dollar amount):
A. $815.
B. $405.
C. $1,065.
D. $500
Answer:
Ending inventory assuming LIFO would be 405
Explanation:
Date Q U.cost Cost Sold Inventory Cost
april 1 500 2,13 1065 310 190 405
apri 20 310 2,63 815,3 310 0 0
620
Ashley and Benjamin are the sole owners of Super Corporation. Ashley owns 40% of the stock and Benjamin owns 60%. Several years after the creation of the corporation, Ashley contributes an additional $20,000 in cash and Benjamin contributes additional property with a fair market value of $30,000 and an adjusted basis of $25,000.
What amount of income is recognized by Super Corporation as a result of these contributions?
Answer:
NONE
Explanation:
The corporation do not recognize income from the contribution of partners. Dong so, will false the revenue recognition as it would be generated at will fom the partners and then distribute as "dividends" while in fact they are moving cash form one place to another
The difference in the property fair value and the adjusted basis will be a gain on Benjamin not for the Partnership
Factors of production are
(A) the mathematical calculations firms make in determining their optimal production levels.
(B) social and political conditions that affect production.
(C) the physical relationships between economic inputs and outputs.
(D) inputs into the production process.
Answer: Factors of production are "(D) inputs into the production process."
Explanation:The factors of production or inputs are the goods or services that are used to produce other goods or services. There are four types of production factors: land, labor, capital and technology.
With these companies produce other goods or services.
What is the effect on the financial statements of recording depreciation on equipment? A. Net income and assets are decreased, but stockholders' equity is not affected. B. Assets are decreased, but net income and stockholders' equity are not affected. C. Net income is not affected, but assets and stockholders' equity are decreased. D. Net income, assets, and stockholders' equity are all decreased.
Answer: The answer is "D. Net income, assets, and stockholders' equity are all decreased.".
Explanation: This happens because the recording of the depreciation of equipment reflects the loss of value of the asset, which is a negative result that impacts the results, the value of the assets, and as a consequence in the stockholders' equity.
Donata Company purchased equipment for $30,000 in December 20x1. The equipment is expected to generate $10,000 per year of additional revenue and incur $2,000 per year of additional cash expenses, beginning in 20x2. Under MACRS, depreciation in 20x2 will be $3,000. If the firm's income tax rate is 40%, the after-tax cash flow in 20x2 would be:
Answer:
Total after-tax cash flow= $6000
Explanation:
Giving the following information:
Equipment value= $30,000 in December 20x1.
Income= $10,000 p
Cost= $2,000 per year.
Depreciation= $3,000.
t=0,40
Cash flow has the following structure:
Income (+)
Cost (-)
Depreciation (-)
=EBIT
TAX (-)
Depreciation (+)
Total
Income= 10000
Costs= -2000
Depreciation= -3000
EBIT= 5000
Tax= -2000
Depreciation= 3000
Total= 6000
Last year, the price of hamburger was $5 per pound and the price of trout was $6 per pound. This year, the price of hamburger is $8 per pound and the price of trout is $9 per pound. All other things equal, and assuming that Phillip purchased both items before, what would you expect to happen to his purchases of hamburger (relative to trout) this year?
Answer: The relative Price of Hamburger has decreased, so Phillip would be expected to purchase more.
Explanation:
Given that,
Price of Hamburger(H):
Last year = $5 per pound
This year = $8 per pound
Price of trout(T):
Last year = $6 per pound
This year = $9 per pound
Last year's Relative price of Hamburger = [tex]\frac{H}{T}[/tex]
= [tex]\frac{5}{6}[/tex]
= 0.833
This year's Relative price of Hamburger = [tex]\frac{H}{T}[/tex]
= [tex]\frac{8}{9}[/tex]
= 0.888
The relative Price of Hamburger has decreased, so Phillip would be expected to purchase more.
Final answer:
As the price of hamburger has increased relatively more than trout, the substitution effect implies that Phillip is expected to decrease his purchases of hamburger relative to trout this year.
Explanation:
Last year, the price of hamburger was $5 per pound, and the price of trout was $6 per pound. This year, the price of hamburger has increased to $8 per pound, and the price of trout has risen to $9 per pound. Based on the provided price changes and assuming all other factors remain constant, we would expect Phillip's purchases of hamburger, relative to trout, to decrease this year. This expectation is based on the economic principle of substitution effect, which suggests that as the price of hamburger rises relatively more than the price of trout, consumers like Phillip would likely buy less hamburger and possibly more trout, or switch to other substitutes if available.
Classify each item as an asset, liability, common stock, revenue, or expense. (a) Issuance of ownership shares. select the correct category (b) Land purchased. select the correct category (c) Amounts owed to suppliers. select the correct category (d) Bonds payable. select the correct category (e) Amount earned from selling a product. select the correct category (f) Cost of advertising. select the correct category
Answer:
The classified list of items is as follows:
(a) Issuance of ownership shares - Common stock
(b) Land purchased - Asset
(c) Amounts owed to suppliers - Liability
(d) Bonds payable - Liability
(e) Amount earned from selling a product - Revenue
(f) Cost of advertising - Expense
Hence, all the items are classified as asset, liability, revenue, common stock and expense.
To retain its edge in the organic health food market, Natura has established a high-priority team comprised of senior executives from the company's production, marketing, and research divisions. These employees work together closely to study consumer attitudes about organic health foods and come up with a closely monitored development and marketing strategy for new products. This ensures that each division is informed of the specific needs, timelines, and expected outcomes of the strategy. It also makes Natura a company that adapts to changes in market trends swiftly. The team Natura uses here is of the ________ type.A) problem-solvingB) self-managed workC) cross-functionalD) traditionalE) departmental
Answer:
Cross-functional
Explanation:
It is a team composed of people with different skills necessary to complete the work.
A cross-functional device is one that:
As a whole it is self-sufficient.
He has the knowledge and skills necessary to build the part of the product that corresponds to him.
Each member's specialty can be complemented by some other team member.
In a multifunctional development team, speed and productivity are triggered because, not depending so much on other people to do the job, request information, resources or requests from different managers, much time is saved in the process.
Ms. Pike, who lives in California, traveled to Oregon to purchase gold jewelry for $16,000. California has a 7.5 percent sales and use tax, while Oregon has no sales and use tax. Compute the use tax that Ms. Pike owes to California on the jewelry purchased in Oregon. Compute the use tax that Ms. Pike owes to California if she purchased the jewelry in New Mexico and paid that state’s 5.125 percent sales tax on the transaction.
Answer:
Pike owes $1200 in taxes is she the purchase $16,000 in Oregon and owes $820 in transactions if she purchase $16,000 in Oergon.
Explanation:
Re call that the total tax is the rate tax time the purchase amount.
T= R * P
Then the use tax that Pike owe to California for the purchase of $16,000 in Oregon Tc taking a rate of 7.5 percent is:
Tc = 0.075 * $16,000 = $ 1,200
The use tax that Pike owe to California for the purchase of $16,000 in New Mexicon Tn dont take into account the sales but the transaction rate of 5.125 percent:
Tn = 0.05125 * $16,000 = $820
For gold jewelry purchased in Oregon, Ms. Pike owes California a use tax of $1,200. If the jewelry was purchased in New Mexico, after paying the New Mexico sales tax, she would owe a use tax of $380 to California.
Explanation:When Ms. Pike purchased the jewelry in Oregon, where there is no sales tax, she would owe California, her home state, a use tax equivalent to what the sales tax would have been had she made the purchase in California. This is calculated by converting the California sales tax percentage to a decimal (0.075) and multiplying by the purchase price:
$16,000 x 0.075 = $1,200
So, Ms. Pike would owe $1,200 in use tax to the state of California for the jewelry purchased in Oregon.
If Ms. Pike traveled to New Mexico and purchased the same jewelry there, paying New Mexico's 5.125 percent sales tax, she would still owe California a use tax. However, in this case, the use tax owed is the difference between the California tax and the tax already paid in New Mexico. First, calculate the tax paid in New Mexico:
$16,000 x 0.05125 = $820
Then, subtract this amount from the California tax:
$1,200 - $820 = $380
So, if the jewelry was purchased in New Mexico, Ms. Pike would owe $380 in use tax to the state of California.
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In addition, the balance of common stock at the beginning of the year was $650,000, and the balance of retained earnings was $50,000. During the year, the company issued additional shares of common stock for $34,000 and paid dividends of $28,000. In addition, the company reported balances for the following assets and liabilities on December 31. Assets Liabilities Cash $ 54,400 Accounts payable $ 15,600 Supplies 12,700 Utilities payable 6,000 Prepaid rent 33,000 Salaries payable 5,300 Land 290,000 Notes payable 33,000 Required: 1. Prepare a statement of stockholders’ equity. 2. Prepare a balance sheet.
Answer:
Assets Liabilies
Cash 54,400 Account Payable 15,600
Supplies 12,700 Salaries Payable 5,300
Prepaid Rent 33,000 Utilities payable 6,000
Total Current Assets 100,100 Note Payable 33,000
Land 290,000 Total liabilities 59,900
Common Stock 684,000
RE -353,800(A)
Total Equity 330,200
Total Asets 390,100 Liab + SE 390,100
Common Stock Retained Earings Total
Balance Jan 1 650,000 50,000 700,000
Net Loss -375,800(B) -375,800
Dividends -28,000 -28,000
Stock issued 34,000 34,000
Balance, Dec 31 684,000 -353,800 330,200
Explanation:
(A)
We calcualte RE ending balance using the accounting equation:
Assets = Liabilities + Equity
390,100 = 59,900 + Common stock + RE
390,100 = 59,900 + (650,000 + 34,000) + RE
RE = 390,000 -59,900 - 684,000
RE = -353,800
Then we construct the Stockholders equity statement
(B)
net loss will be:
begining RE + income + dividend = ending RE
50,000 + income - 28,000 = -353,800
income= -353,800 +28,000 - 50,000 = -375,800 net loss as it is negative.
To prepare a statement of stockholders’ equity, calculate the ending balance of common stock by adding the beginning balance of common stock and the additional shares issued, and then subtracting the dividends paid. To prepare a balance sheet, list the assets and liabilities on December 31 and calculate the equity by subtracting the total liabilities from the total assets.
Explanation:To prepare a statement of stockholders’ equity, we need to consider the changes in common stock, retained earnings, additional shares issued, and dividends paid.
1. Beginning balance of common stock: $650,000
2. Beginning balance of retained earnings: $50,000
3. Additional shares of common stock issued: $34,000
4. Dividends paid: $28,000
To calculate the ending balance of common stock, we add the beginning balance and the additional shares issued, and subtract the dividends paid: $650,000 + $34,000 - $28,000 = $656,000
Therefore, the statement of stockholders’ equity shows an ending balance of common stock of $656,000.
To prepare a balance sheet, we list the assets and liabilities as of December 31:
Cash: $54,400Accounts payable: $15,600Supplies: $12,700Utilities payable: $6,000Prepaid rent: $33,000Salaries payable: $5,300Land: $290,000Notes payable: $33,000To calculate the equity, we subtract the total liabilities from the total assets: $54,400 + $12,700 + $33,000 + $290,000 - $15,600 - $6,000 - $33,000 - $5,300 = $340,200
Therefore, the balance sheet shows total assets of $397,400 and total liabilities and equity of $357,800.1
Set up the 2015 balance sheet for Circle Corp. based on the following information: cash = $141,000; patents and copyrights = $630,000; accounts payable = $219,000; accounts receivable = $132,500; tangible net fixed assets = $1,655,000; inventory = $300,000; notes payable = $110,000; accumulated retained earnings = $1,250,000; long-term debt = $859,000. (Be sure to list the accounts in order of their liquidity. Do not round intermediate calculations.)
Answer:
Explanation:
Balance sheet: In the balance sheet, the assets, liabilities, and stockholder equity is recorded. In this the accounting equation is used which is shown below:
Total assets = Total liabilities + stockholder equity
The debit and credit side of the balance sheet should always be equal and balanced.
Moreover, it always is prepared on the specified date.
The common stock amount is not given in the question, so it is a balancing figure. It is computed by
= Total assets - total current liabilities - total long term liabilities - accumulated retained earning
= $2,858,500 - $329,000 - $859,000 - $1,250,000
= $420,500
The preparation of the balance sheet is presented in the spreadsheet. Kindly find the attachment below:
Lara allocates wealth between two periods: youth (time 1) and old age (time 2).Currently (in her youth) she has $8,000 in cash. She can borrow and lend at the bankat a rate of 15% between time 1 and time 2 (that is, lending $1 in youth will give her$1.15 in old age). Her only investment opportunity other than the bank is a projectthat costs $5,000 now in her youth and has a payoff of $6,000 in her old age. What isthe most Lara can consume in her old age? Assume Lara cannot consume a negativeamount in her youth.
Answer:
The second alternative is the one that will allow her to consume more in her old age.
Explanation:
Giving the following information:
Lara allocates wealth between two periods: youth (time 1) and old age (time 2).
In her youth, she has $8,000 in cash. She can borrow and lend at the bank at a rate of 15% between time 1 and time 2.
Her only investment opportunity other than the bank is a project that costs $5,000 now in her youth and has a payoff of $6,000 in her old age.
Alternative A:
We will use the final value formula.
FV= Present Value*(1+i)^n
FV= 8000*(1.15)^1= $9200
Alternative B:
Receive $6000
Invest 3000= 3000*(1.15)^1= 3450
Total= $9450
The second alternative is the one that will allow her to consume more in her old age.
You purchase 100 shares of stock for $40 a share. The stock pays a $2 per share dividend at year-end. a. What is the rate of return on your investment if the end-of-year stock price is (i) $38; (ii) $40; (iii) $46? (Leave no cells blank - be certain to enter "0" wherever required. Enter your answers as a whole percent.) b. What is your real (inflation-adjusted) rate of return if the inflation rate is 3%? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places. Negative amounts should be indicated by a minus sign.)
Answer:
a (i) 0%
a (ii) 5%
a (iii) 20%
a (i) - 2.91%
a (ii) 1.94%
a (iii) 16.51%
Explanation:
The computation is shown below:
a (i) Rate of return = (End year stock price - purchase price) + dividend ÷ (purchase price)
= ($38 - $40) + $2 ÷ 40
= 0%
a (ii) Rate of return = (End year stock price - purchase price) + dividend ÷ (purchase price)
= ($40 - $40) + $2 ÷ 40
= 5%
a (iii) Rate of return = (End year stock price - purchase price) + dividend ÷ (purchase price)
= ($46 - $40) + $2 ÷ 40
= 20%
The computation of the real rate of return is shown below:
b. (i) Real rate of return = {( 1 + nominal rate of return) ÷ ( 1+ inflation rate)} - 1
= {( 1 + 0) ÷ ( 1 + 0.03)} - 1
= - 0.029 or - 2.91%
b. (ii) Real rate of return = {( 1 + nominal rate of return) ÷ ( 1+ inflation rate)} - 1
= {( 1 + 0.05) ÷ ( 1 + 0.03)} - 1
= 0.019 or 1.94%
b. (iii) Real rate of return = {( 1 + nominal rate of return) ÷ ( 1+ inflation rate)} - 1
= {( 1 + 0.20) ÷ ( 1 + 0.03)} - 1
= 0.016 or 16.51%
The rates of return are 0%, 5%, and 20% for the stock prices $38, $40, and $46 respectively. The inflation-adjusted rates of return are -3%, 1.94%, and 16.5% respectively.
Explanation:The rate of return on an investment is calculated as the total income from the investment, i.e., gains plus dividends, divided by the initial investment, multiplied by 100 to get a percentage.
For stock price (i) $38: The total income is ($38 - $40)*100 + $2*100 = -$200 + $200 = $0, therefore, the Rate of Return is $0/$4000 * 100% = 0%.
For stock price (ii) $40: The total income is ($40 - $40)*100 + $2*100 = $200, therefore, the Rate of Return is $200/$4000 * 100% = 5%.
For stock price (iii) $46: The total income is ($46 - $40)*100 + $2*100 = $800, therefore, the Rate of Return is $800/$4000 * 100% = 20%.
The real rate of return, or the inflation-adjusted rate of return, is calculated by subtracting the inflation rate from the nominal rate. Therefore, the real rates of return for stock prices $38, $40, and $46 are -3%, 1.94%, and 16.5%, respectively.
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At the beginning of the year (January 1), Buffalo Drilling has $10,000 of common stock outstanding and retained earnings of $7,500. During the year, Buffalo reports net income of $7,800 and pays dividends of $2,500. In addition, Buffalo issues additional common stock for $7,300. Required: Prepare the statement of stockholders' equity at the end of the year (December 31).
Answer:
Explanation:
For preparing the statement, first we have to compute the ending balance of the common stock and the retained earning
Ending balance of the common stock = Beginning balance + Additional common stock issued
= $10,000 + $7,300
= $17,300
Ending balance of the retained earnings = Beginning balance + Net income - dividend paid
= $7,500 + $7,800 - $2,500
= $12,800
So, the total stockholder equity = Ending balance of the common stock + Ending balance of the retained earnings
= $17,300 + $12,800
= $30,100
The statement of stockholder equity is shown in the spreadsheet. Kindly find the attachment below.
The statement of stockholders' equity for Buffalo Drilling at year-end will show common stock of $17,300 and retained earnings of $12,800, totaling $30,100 in stockholders' equity.
Explanation:Statement of Stockholders' EquityTo prepare the statement of stockholders' equity for Buffalo Drilling at the end of the year, one must perform a few calculations to determine the changes in the equity accounts throughout the year. The opening balances of common stock and retained earnings and the transactions during the year will be included.
At the beginning of the year:
Common stock: $10,000Retained earnings: $7,500Changes during the year:
Net income: +$7,800Dividends paid: -$2,500Issue of additional common stock: +$7,300Ending balances on December 31 will be:
Common stock: $10,000 + $7,300 = $17,300Retained earnings: $7,500 + $7,800 (net income) - $2,500 (dividends) = $12,800So the statement of stockholders' equity will show:
Common stock: $17,300Retained earnings: $12,800The total stockholders' equity at the end of the year will be the sum of common stock and retained earnings, which amounts to $30,100.
Using the data below, calculate GDP. Show your work. Personal consumption expenditures $5,207 Interest 425 Corporate profits 735 Government spending 1,406 Depreciation 830 Rental income 146 Gross private domestic investment 1,116 Compensation of employees 4,426 Exports 870 Imports 965 Indirect business taxes 553 Proprietors' income 520 Personal taxes 886 Social Security taxes 432 Transfer payments 376
Answer:
GDP= 7634
Explanation:
Gross Domestic Product (GDP) is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period. It is an indicator to measure the economic health of a country.
The formula to calculate GDP is of three types – Expenditure Approach, Income Approach, and Production Approach.
The Expenditure Approach is a method of measuring GDP by calculating all spending throughout the economy including consumer consumption, investing, government spending, and net exports. This method calculates what a country produces, assuming that the finished goods and services of a country equals the amount spent in the country for that period.
The formula is:
GDP=C+I+G+/-NX
GDP: Gross Domestic Product
(C) consumer spending – this is the amount that all consumers spend on goods and services for personal use.
(I) investment – this is the amount that businesses or owners spend to invest in new equipment or expansions.
(G) government spending – this includes spending on new infrastructure like bridges and roads.
(NX) net exports – this includes spending on a country’s exports minus its spending on imports.
Personal consumption expenditures $5,207
Government spending 1,406
Gross private domestic investment 1,116
Exports 870
Imports 965
GDP= 5207+1406+1116+(870-965)
GDP= 7634
Notice that we didn't include Wages, Corporate Profits, Depreciation, etc. The expenditure income approach doesn't include Wages. They are part of the formula to calculate GDP by the Income Approach.
The price of imported oil rises. If the government wanted to stabilize output, which of the following could it do?
a. increase government expenditures or increase the money supply
b. increase government expenditures or decrease the money supply
c. decrease government expenditures or increase the money supply
d. decrease government expenditures or decrease the money supply
Answer:
The correct answer is letter "A": increase government expenditures or increase the money supply.
Explanation:
Fiscal policy refers to the joint governmental decisions concerning taxation and spending of a nation. The term was coined by the British economist John Maynard Keynes (1883-1946) who claimed that governments could control rates of macroeconomic growth by raising the rate of employment, battling inflation and flattening business cycles.
Whether increasing government expenses or money supply, the overall economy will be balanced as long as the prices are going up as well.
A reduction in transaction costs will tend to
(A) reduce the number of mutually beneficial exchanges that occur.
(B) make specialization according to the law of comparative advantage more difficult.
(C) decrease the value created by exchanges in an economy.
(D) increase the number of mutually beneficial exchanges that occur.
Answer:
increase the number of mutually beneficial exchanges that occur.
Explanation:
When you reduce the transactions cost, the number of transactions increase, it means that every agent it’s benefit, because the buyer could afford more transactions and the seller could reduce the price of their products or services that are included in the purchase. Even the agent it's in charge of the transaction its benefit too, because the number of transactions increase due to the increase of the demand.
During 2020, $830000 of raw materials were purchased, direct labor costs amounted to $670000, and manufacturing overhead incurred was $640000. Waterway Industries's total manufacturing costs incurred in 2020 amounted to
Answer:
Waterway Industries's total manufacturing costs incurred in 2020 amounted to $2,140,000
Explanation:
The computation of the total manufacturing cost is shown below:
= Raw material + Direct labor cost + Manufactured overhead cost
= $830,000 + $670,000 + $640,000
= $2,140,000
Thus, the total manufacturing cost is comprised of direct raw material, direct labor cost, and the manufacturing overhead cost. That's why we add these three costs.
Accounting Cycle Review Do IT 0-10a Cullumber Company shows the following balances in selected accounts of its adjusted trial balance. Supplies $30,080 Supplies Expense 5,640 Accounts Receivable 11,280 Dividends 20,680 Retained Earnings 65,800 Service Revenue 101,520 Salaries and Wages Expense 37,600 Utilities Expense 7,520 Rent Expense 16,920 Prepare the remaining closing entries at December 31. (If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when the amount is entered.
Answer:
Service Revenue 101,520 debit
Income Summary 101,520 credit
to close revenue account
Income Summary 67,680 debit
Supplies expense 5,640 credit
Salaries and Wages Expense 37,600 credit
Utilities Expense 7,520 credit
Rent Expense 16,920 credit
to close expenses account
Income Summary 20,680 debit
Dividends 20,680 credit
to close dividends
Income Summary 13,160 debit
Retained Earnings 13,160 credit
to close income summary agains retained earnings
Explanation:
we will close the temporary account against income summary.
The temporary accounts will be dividends, revenues and expense account.
Then we will close income summary balance against retained earings.
Income Summary balance:
credit 101,520
debit 67,680
debit 20,680
Balance: 13,160
Barry’s Steroids Company has $1,000 par value bonds outstanding at 13 percent interest. The bonds will mature in 40 years. If the percent yield to maturity is 11 percent, what percent of the total bond value does the repayment of principal represent?
Answer:
[tex]principle payement = 1.75[/tex]%
Explanation:
From Appendix D
Present Value of Interest Payments
PVA = A × PVIFA (n = 40, i = 13%)
A = 0.13 * 1000 = 130
[tex]PVIFA = \frac{1 - (1-\frac{r}{t}^(-m\times t)}{\frac{r}{t}}[/tex]
[tex]PVIFA = \frac{1 - (1-\frac{0.13}{40}^(-40)}{0.13}[/tex]
= 7.650
PVA = $130 × 7.650 = $994.5
From Appendix B
Present Value of Principal Payment
PV = FV × PVIF (n = 40, i = 13%)
PV = $1,000 × .0075 = $7.5
here PVIF value AT 40 YEAR FOR 13 % is 0.0075
Present Value of Interest Payments = $994.5
Present Value of Principal Payment = $ 17.5
Total Present Value the Bond = interest payment + principal payment = $ 856.96
[tex]principle \ payement = \frac{17.5}{994.5} \times 100[/tex]
[tex]principle payement = 1.75[/tex]%
Lemony Company made sales of $ 32 comma 200 million during 2018. Cost of goods sold for the year totaled $ 12 comma 880 million. At the end of 2017, Lemony's inventory stood at $ 1 comma 200 million, and Lemony ended 2018 with inventory of $ 1 comma 600 million. Compute Lemony's gross profit percentage and rate of inventory turnover for 2018. Begin by computing Lemony's gross profit percentage for 2018. (Round your answer to the nearest tenth of a percent, X.X%.) Lemony's gross profit percentage for 2018 is %.
To find Lemony Company's gross profit percentage for 2018, we subtract the cost of goods sold from the total sales to get the gross profit and then divide it by the total sales. The calculation shows that the gross profit percentage for 2018 is 59.9%.
Explanation:To calculate the gross profit percentage, we first need to determine the gross profit in dollars. Gross profit is calculated by subtracting the cost of goods sold (COGS) from total sales. In this scenario, the total sales are $32,200 million and the cost of goods sold is $12,880 million. Therefore, the gross profit is calculated as follows:
Gross Profit = Total Sales - Cost of Goods Sold
Gross Profit = $32,200 million - $12,880 million
Gross Profit = $19,320 million
Next, to find the gross profit percentage, we divide the gross profit by the total sales and multiply by 100 to convert it to a percentage:
Gross Profit Percentage = (Gross Profit / Total Sales) × 100
Gross Profit Percentage = ($19,320 million / $32,200 million) × 100
Gross Profit Percentage = 59.9%
Therefore, Lemony's gross profit percentage for 2018 is 59.9%.
Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month’s budget appear below: Selling price per unit $ 29 Variable expense per unit $ 14 Fixed expense per month $ 12,450 Unit sales per month 980 Required: 1. What is the company’s margin of safety? (Do not round intermediate calculations.) 2. What is the company’s margin of safety as a percentage of its sales? (Round your percentage answer to 2 decimal places (i.e. 0.1234 should be entered as 12.34).)
Answer:
a) $4,350 b) 15.31%
Explanation:
a) Units sold per month = 980
Unit selling price = $29
Variable cost per unit = $14
Monthly fixed cost= $12,450
The formula for Margin of safety
= Actual sales –Break-even sales
Total monthly sales = 980 * $29 = $28,420
Break-Even sales (units) = FC / (SP- VC) FC = Fixed cost
= $12,450/ (29-14) SP - Selling price
= $12,450 / 15 VC = Variable cost
= 830 units
Break-even sales in $ = 830 * $29 = $24,070
Margin of safety = Actual sales –Break-even sales
= $ 28,420 - $24,070
= $ 4,350
b) Margin of safety as a % of sales
= ($ 4,350 / $ 28,420) * 100
= 15.31%
To determine the margin of safety for Molander Corporation, subtract break-even sales from total sales and then calculate the margin of safety as a percentage. For Doggies Paradise Inc. and AAA Aquarium Co., calculate the revenue, cost metrics, and sketch appropriate curves to find the profit maximizing quantities.
Explanation:The Molander Corporation is looking to understand its margin of safety and the margin of safety as a percentage of its sales. The margin of safety is the difference between actual or budgeted sales and the sales level at the break-even point. It represents the amount by which sales can drop before reaching the break-even point. To calculate this:
Total Sales = Unit Sales per Month x Selling Price per Unit = 980 x $29Break-Even Sales = Fixed Expense per Month / (1 - (Variable Expense per Unit / Selling Price per Unit))Subtract the Break-Even Sales from the Total Sales to find the margin of safety. To calculate the margin of safety as a percentage of sales, divide the margin of safety by the Total Sales and multiply by 100.
For Doggies Paradise Inc., to find the profit maximizing quantity, we calculate total revenue, marginal revenue, total cost, and marginal cost for all levels of output, then sketch the related curves.
For AAA Aquarium Co., we perform similar calculations to determine the profit-maximizing quantity and sketch revenue and cost curves.
Exotics Faucets and Sinks LTD., guarantees that its new infrared sensor faucet will save any household that has 2 or more children at least $30 per month in water costs beginning 1 month after the faucet is installed. If the faucet is under full warranty for 5 years, the minimum amount a family of four could afford to spend now on such a faucet at an interest rate of 1/2% per year, compounded monthly, is closest to(a) $149c) $1787(b) $1552d) $1890
Answer:
$1552
Explanation:
it will save 30 per month during 5 years.
we can calculate this as an annuity. So the value of the faucets will be the present value of the cash savings:
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
C $30 saving per month
time 5 years x 12 month per year = 60 months
rate 0.5% = 0.5/100 = 0.005
[tex]30 \times \frac{1-(1+0.005)^{-60} }{0.005} = PV\\[/tex]
PV $1,551.7668
Rounding it will be closest to 1,552
Joe runs the Service Division for a car dealership. The overall dealership has profit of $10 million on sales of $100 million and costs of $90 million. Joe’ s division contributed $9 million in sales and $7 million in costs. If the Service Division is evaluated as a profit center, what dollar amount is most relevant to Joe?
Answer:
The $2 million dollar amount is most relevant to Joe
Explanation:
Profit center: It is a center in which the amount is recorded as a profit which is to be calculated by subtracting the total cost from the revenue.
Since we have to compute the dollar amount as a profit center and we know the profit equals to
= Sales Revenue - total cost
So, = $9 million - $7 million = $2 million
The other items which are mentioned in the question are irrelevant. Hence, it is ignored
Debt ratios measure the proportion of total assets financed by a firm’s creditors. Sunny Co. has a debt-to-equity ratio of 4.00, compared to the industry average of 3.20. Its competitor Carter Co., however, has a debt-to-equity ratio of 6.00. Based on what debt-to-equity ratios imply, which of the following statements is true? Carter Co. has greater financial risk as compared to Sunny Co. and to the average financial risk in the industry. Sunny Co.’s shareholders expect magnified returns but higher risk as compared to Carter Co. Carter Co.’s creditors face lesser risk than the average financial risk in the industry. Carter Co. has higher creditworthiness as compared to Sunny Co.
Answer:
Carter Co. has greater financial risk as compared to Sunny Co. and to the average financial risk in the industry.
Explanation:
Since the industry average is 3.20
Provided Debt to Equity is
Sunny Co. 4.00
Carter Co. 6.00
Since debt to equity represents the financial risk associated with the product.
It is clear that both the companies are on a higher financial risk than that of the industry.
Further the company is still in a better position than that of the competitor, as the later has higher debt to equity ratio.
Therefore, the first statement concluding that the financial risk of Carter Co. is highest of all including the competitor and the industry average is True.
Emily purchased a building to store inventory for her business. The purchase price was $760,000. Emily also paid legal fees of $300 to acquire the building. In March, Emily incurred $2,000 to repair minor leaks in the roof (from storm damage earlier in the month) and $5,000 to make the interior suitable for her finished goods and $300 for legal fees. What is Emily's cost basis in the new building?
Answer: Emily's cost basis in the new building is $81,600
Explanation: Hi, the resolution of this problem is :
$76,000(purchase price) + $600 (legal fees) + $5000(improvements) =$81,600
The $2000 repair of the minor leaks in the roof is not a capitalized cost, it´s a routine maintenance expenditure.
The improvements in the building and the legal fees would be capitalized as expenses to begin using the building.
Emily's cost basis in the new building is $81,600
Answer:
$765300
Explanation:
Please see attachment .
Concord Corporation uses a periodic inventory system. Details for the inventory account for the month of January 2017 are as follows:
Units Per unit price Total
Balance, 1/1/2017 240 $4.00 $960
Purchase, 1/15/2017 120 ..4.20 504
Purchase, 1/28/2017 120 ..4.40 528
An end of the month (1/31/2017) inventory showed that 190 units were on hand. If the company uses FIFO and sells the units for $8.00 each, what is the gross profit for the month?
Answer:
Gross profit= $1150
Explanation:
Giving the following information:
Beginning inventory: 240u*$4.00= $960
Purchase, (1/15/2017)= 120u*4.20= $504
Purchase, (1/28/2017)= 120u*4.40= $528
Ending inventory= 190u
The company uses FIFO (first in, first out).
Sale price= $8.00 each.
What is the gross profit for the month?
First, we need to calculate the number of units sold:
Sold units= Beginning inventory + purchase - ending inventory= 240 + 240 - 190= 290 units
Revenue= 290*8= $2320
Cost of goods sold= 240*$4 + 50*4.20= $1170
Gross profit= $1150
Compute Emily's 2018 taxable income on the basis of the following information. Her filing status is single. Salary $85,000 Interest income from bonds issued by Xerox 1,100 Alimony payments received (divorce finalized in 2014) 6,000 Contribution to traditional IRA 5,500 Gift from parents 25,000 Capital gain from stock investment, held for 7 months 2,000 Amount lost in football office betting pool 500 Age 40
Answer:
The Emily's 2018 taxable income is $76,600
Explanation:
The computation of the taxable income for the year 2018 is shown below:
= Salary + interest income from bonds issued by Xerox + Alimony payments received + Capital gain from stock investment, held for 7 months - Contribution to traditional IRA - standard deduction
= $85,000 + $1,100 + $6,000 + $2,000 - $5,500 - $12,000
= $76,600
The standard deduction for married and single tax payers is $12,000
And, the Gift from parents is not taxable & Amount lost in football office betting pool is not allowed for deduction as it is come under gambling.
Emily’s taxable income for 2018 is determined by adding her salary, interest, alimony, and short-term capital gains, then subtracting her deductible IRA contribution, which results in a total taxable income of $88,600.
However, the gift from her parents and her losses in the football pool do not affect her taxable income.
Explanation:To calculate Emily's taxable income in 2018, we need to add up all her taxable incomes and subtract any deductions.
Emily's salary of $85,000 is fully taxable.The interest income from the bonds of $1,100 is taxable.Because Emily's divorce finalized in 2014, her alimony payments of $6,000 are taxable.The capital gain of $2,000 from her stock investments could is taxable as it was held for less than a year.Subtract any deductions:
Emily made a $5,500 contribution to a traditional IRA which is deductible.Gifts are not considered income for the recipient, and likewise, so the $25,000 gift from her parents isn't included in taxable income.The $500 Emily lost in the football pool is unfortunately not a deductible loss.Therefore, her taxable income will be $85,000 (salary) + $1,100 (interest) + $6,000 (alimony) + $2,000 (capital gain) - $5,500 (IRA Contribution) = $88,600.
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