Answer:
She should call her bank to report her card as lost or stolen.
Explanation:
Whenever a card is been lost, the most clever thing to do is to call your bank immediately, telling them to suspend all transaction on the card per say.
It is known to be normally reversible just in case it was in the right place or later found by you; but if not, the bank will then request a new card is generated. Your old card stays suspended until your new card arrives and you phone up to activate it.
If you think you’ve temporarily misplaced your debit or credit card or would like to freeze different types of transactions you can do this also through the Mobile Banking app.
On January 1, 2018, Shehata Coffee Shop (SCS) acquired kitchen equipment for $31,800 cash. SCS estimated a $1,200 residual value and an estimated useful life of 4 years. SCS uses straight-line depreciation computed monthly. On July 1, 2021, the company sold the equipment for $5,700 cash.
Required:
a. Calculate the annual Depreciation Expense; show your work, 1.5 points
b. Provide the journal entry to record the sale, show your work, 6 points
Answer:
Depreciation is $7,650
The journal entries for sale :
Dr Cash $5,700
Dr accumulated depreciation $26,775
Cr Kitchen equipment $31,800
Cr Gain on disposal of kitchen equipment $675
Explanation:
Annual depreciation =cost-residual value/useful life
cost is $31,800
residual value is $1,200
useful life is 4 years
Annual depreciation=($31,800-$1,200)/4=$7,650
The kitchen equipment was disposed off when it has been used for 3 years and six months,hence the accumulated depreciation is shown below:
=annual depreciation*3.5
accumulated depreciation=$7.650*3.5=$26,775.00
7. On May 1, Jennings, a car dealer, emails Wheeler and says, "I have a 1955 Thunderbird convertible in mint condition that I will sell you for $13,500 at any time before June 9. [Signed] David Jennings." By May 15, having heard nothing from Wheeler, Jennings sells the car to another. On May 29, Wheeler accepts Jennings’ offer and tenders $13,500. When told that Jennings had sold the car to another, Wheeler claims Jennings has breached their contract. Did Jennings breach? Explain.
Answer:
Jennings breached the contract
Explanation:
A merchant firm offer is one that is irrevocable, the offeror makes an offer to sell goods within a given time frame and signs off on it.
Even without consideration (acceptance) from the other party, the contract is irrevocable.
A merchant firm offer that does not have a stated time frame rains open for a reasonable time.
In this instance Jennings made a merchant firm offer. Even if Wheeler had not accepted the offer it is irrevocable till June 9.
So by selling the car on May 15 he has breached the contract.
Yes, Jennings breached the contract with Wheeler by selling the car to someone else after Wheeler accepted the offer.
Explanation:Yes, Jennings breached the contract with Wheeler. In this case, an offer was made by Jennings to Wheeler through email. Wheeler accepted the offer by tendering the correct amount of money, but Jennings had already sold the car to someone else. However, the key factor here is whether there was a valid contract in place between the parties.
In contract law, an offer becomes effective upon the communication of the offer to the offeree. In this case, by emailing Wheeler with the offer, Jennings effectively communicated the offer to Wheeler. Upon receiving the offer, Wheeler had the option to accept or reject it.
By tendering the money, Wheeler accepted the offer, and a contract was formed. However, since Jennings had already sold the car to someone else, he breached the contract with Wheeler. Therefore, Jennings is legally responsible for breaching the contract.
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Martin Company had the following department information for the current year: work in process, May 1 (physical units), 8,000; completed and transferred out (physical units), 35,000; and work in process, May 31 (physical units), 13,000. Materials are added at the beginning of the process. What is the total number of equivalent units for materials in May
Final answer:
The total number of equivalent units for materials in May for Martin Company is calculated by adding the completed and transferred out units to the units in process at the end of the month, resulting in 48,000 equivalent units.
Explanation:
The student asked about calculating the total number of equivalent units for materials for Martin Company in the month of May, with given data on work in process at the beginning and end of the month, and completed and transferred out units. Since materials are added at the beginning of the process, the equivalent units for materials would be the total units introduced into the process for the month. This includes both units completed and transferred out and the units still in process at the end of the month. Therefore, the calculation would be:
Completed and transferred out: 35,000 unitsWork in process, May 31: 13,000 unitsTotal units for materials = 35,000 (completed and transferred) + 13,000 (ending work in process) = 48,000 equivalent units for materials in May.
The firm is currently in the process of forecasting sales, asset requirements, and required funding for the coming year. In the year that just ended, Blue Elk Manufacturing generated $500,000 net income on sales of $13,000,000. The firm expects sales to increase by 16% this coming year and also expects to maintain its long-run dividend payout ratio of 45%. Suppose Blue Elk Manufacturing's assets are fully utilized, use the additional funds needed (AFN) equation to determine the increase in total assets that is necessary to support Blue Elk Manufacturing's expected sales. $460,000 $576,000 $528,000 $384,000 When a firm grows, some liabilities grow spontaneously along with sales. Spontaneous liabilities are a source of capital that the firm will generate internally, so they reduce the need for external capital. How much of the total increase in assets will be supplied by spontaneous liabilities for Blue Elk Manufacturing this year? $67,200 $51,200 $64,000 $76,800 In addition, Blue Elk Manufacturing is expected to generate net income this year. The firm will pay cut some of its earnings as dividends but will retain the rest for future asset investment. Again, the more a firm generates internally from its operations, the less it will have to raise externally from the capital markets. Assume that the firm's profit margin and dividend payout ratio are expected to remain constant. Given the preceding information, Blue Elk Manufacturing is expected to generate from operations that will be added to retained earnings. According to the AFN equation and projections for Blue Elk Manufacturing, the firm's AFN is
Answer:
Required Asset to increase sales by 16% is $480,000
Increased liability percentage is $64,000
Added to retained earnings $319,000
Explanation:
The automobile industry in both Brazil and Mexico is thriving. If you were a government official from an African country (such as Morocco, Nigeria, or South Africa) who has visited both countries and has been very impressed, which approach would you recommend to your own government interested in attracting FDI from global automakers: the Brazilian approach or the Mexican approach? Why
Answer:
The Brazilian approach
Explanation:
Since the countries approach successful and have grown very well. I have to but into consideration the African conditions to make business go internationally. As a official in the government of africa, i will use the approach Brazil , Mexico has a great location to make business. Especially being a neighbor of U.S. is providing agreat opportunity. In an African country, location will be of no benefit to you. This will affect negatively to make business with other countries such as Asia and European Union . All this will make it hard for an African country to be in a market that is competitive . When your competitors get low materials and provide low shipping costs, you need to handle to reduce your production cost to be in the market for the same amount of money.
Comparing the Brazilian and Mexican approaches to attracting FDI from global automakers and recommending the best approach for an African country.
The Brazilian Approach:
Brazil has a stable economy and government incentives that attract foreign automakers. The country's focus on producing SUV-like cars with flex-fuel engines caters to consumer demands and aligns with the biofuel industry.
The Mexican Approach:
Mexico offers cost savings for automakers due to lower wages and is part of a free trade bloc with the United States, allowing for easier access to markets. Multinationals like Volkswagen and Toyota have established assembly plants in Mexico to benefit from these advantages.
Recommendation:
Considering the stable economy, consumer demands, and government incentives, the Brazilian approach may be more suitable for attracting FDI from global automakers for an African country looking to boost its automotive industry.
The information below pertains to Stellar Company for 2021. Net income for the year$1,240,000 7% convertible bonds issued at par ($1,000 per bond); each bond is convertible into 30 shares of common stock1,970,000 6% convertible, cumulative preferred stock, $100 par value; each share is convertible into 3 shares of common stock3,970,000 Common stock, $10 par value6,010,000 Tax rate for 202120% Average market price of common stock$25 per share
Answer:
The Question is missing requirement which should be;
Calculate Diluted EPS for the stellar company for the year 2021
Explanation:
Convertible Bonds ($1,970,000/1000)*30 59,100
Preferred Stocks (3,970,000/100)*3 119,100
Common Stocks (6,010,000/10) 601,000
Total Weighted Average Stocks 779,200
Diluted EPS=Net Income*(1-t)+after tax cost of interest/Weighted average stocks=$1,240,000*(1-20%)+1,970,000*7%*(1-20%)+3,970,000*6%*(1-20%)/779,200
=992,000+110,320+190,560/779,200
=$1.66
For its inspecting cost pool, Ellsworth, Inc. expected overhead cost of $520000 and 4000 inspections. The actual overhead cost for that cost pool was $600000 for 5000 inspections. The activity-based overhead rate used to assign the costs of the inspecting cost pool to products is
Final answer:
To calculate the activity-based overhead rate for Ellsworth, Inc., divide the expected overhead cost by the expected number of inspections, resulting in $130 per inspection. Spreading the overhead implies that as more units are produced, the average fixed cost per unit decreases, leading to the hyperbolic shape of the average fixed cost curve.
Explanation:
The student's question pertains to the calculation of the activity-based overhead rate within a managerial accounting context.
First, we need to understand that the activity-based overhead rate is calculated by dividing the expected overhead cost by the expected level of activity, which in this case is the number of inspections. So, for Ellsworth, Inc., the activity-based overhead rate is calculated as follows:
Activity-Based Overhead Rate = Expected Overhead Cost / Expected Number of Inspections
Activity-Based Overhead Rate = $520,000 / 4,000 inspections
The result is an activity-based overhead rate of $130 per inspection.
The concept of spreading the overhead refers to the distribution of fixed costs over the units produced. As more goods or services are produced, the average fixed cost per unit decreases because the total fixed costs are being spread over more units.
For example, suppose the fixed cost is $1,000. If only one unit is produced, the average fixed cost is the entire $1,000. However, if 100 units are produced, the average fixed cost drops to $10 per unit. Thus, the average fixed cost curve would be a hyperbola that approaches zero as the quantity of output increases. This demonstrates how fixed costs per unit decrease as production rises, a concept known as spreading the overhead.
The correct option is a. 120. The activity-based overhead rate used to assign the costs of the inspecting cost pool to products is $120 per inspection.
To determine the activity-based overhead rate for the inspecting cost pool, we need to calculate the cost per inspection. This is done by dividing the total overhead cost by the number of inspections.
First, we calculate the expected overhead rate:
Expected overhead rate = Expected overhead cost / Expected number of inspections
Expected overhead rate = $520,000 / 4,000 inspections
Expected overhead rate = $130 per inspection
Next, we calculate the actual overhead rate:
Actual overhead rate = Actual overhead cost / Actual number of inspections
Actual overhead rate = $600,000 / 5,000 inspections
Actual overhead rate = $120 per inspection
The complete question is- For its inspecting cost pool, Ellsworth, Inc. expected overhead cost of $520000 and 4000 inspections. The actual overhead cost for that cost pool was $600000 for 5000 inspections. The activity-based overhead rate used to assign the costs of the inspecting cost pool to products is:
a. $120 per inspection.
b. $80 per inspection.
c. $96 per inspection.
d. $100 per inspection.
Klean Fiber Company is the creator of Y-Go, a technology that weaves silver into its fabrics to kill bacteria and odor on clothing while managing heat. Y-Go has become very popular in undergarments for sports activities. Operating at capacity, the company can produce 1,060,000 Y-Go undergarments a year. The per unit and the total costs for an individual garment when the company operates at full capacity are as follows. Per Undergarment Total Direct materials $2.04 $2,162,400 Direct labor 0.53 561,800 Variable manufacturing overhead 0.99 1,049,400 Fixed manufacturing overhead 1.41 1,494,600 Variable selling expenses 0.31 328,600 Totals $5.28 $5,596,800 The U.S. Army has approached Klean Fiber and expressed an interest in purchasing 249,800 Y-Go undergarments for soldiers in extremely warm climates. The Army would pay the unit cost for direct materials, direct labor, and variable manufacturing overhead costs. In addition, the Army has agreed to pay an additional $0.99 per undergarment to cover all other costs and provide a profit. Presently, Klean Fiber is operating at 70% capacity and does not have any other potential buyers for Y-Go. If Klean Fiber accepts the Army’s offer, it will not incur any variable selling expenses related to this order.
Answer and Explanation:
The preparation of incremental analysis for the Klean Fiber is shown below:-
Reject order Accept order Net Increase/
Decrease
Revenue
($4.55 × 249,800) $1,136,590 $1,136,590
Less:
Variable costs
Direct material $509,592 $509,592
($2.04 × 249,800)
Direct labor $132,394 $132,394
($0.53 × 249,800)
Variable overhead $247,302 $247,302
($0.99 × 249,800)
Total variable cost $889,288 $889,288
Net income $247,302 $247,302
Therefore by accepting the order the net income increases by $247,302 which means the net income is increasing by accepting the order.
Working note
Selling price = Direct material + Direct labor + Variable overhead + Additional amount
= $2.04 + $0.53 + $0.99 + $0.99
= $4.55
Outose Concept manufactures small tables in its Processing Department. Direct materials are added at the initiation of the production cycle and must be bundled in single kits for each unit. Conversion costs are incurred evenly throughout the production cycle. Before inspection, some units are spoiled due to nondetectible materials defects. Inspection occurs when units are 50% converted. Spoiled units generally constitute 5% of the good units. Data for December 2015 are as follows:WIP, beginning inventory 12/1/2015 23,000 unitsDirect materials (100% complete)conversion costs (45% complete)Started in December 76,500 unitsCompleted and transferred out 12/31/2015 72,100 unitsWIP, ending inventory 12/31/2015 19,000 unitsDirect materials (100% complete)Conversion costs (40% complete)Costs for December:WIP, beginning inventory:Direct materials $153,000Conversion costs 77,100Direct materials added 223,400Conversion costs added 294,000Abnormal spoilage totals ________.8400 units4845 units3605 units4025 units
Answer:
8,400 units
Explanation:
Abnormal spoilage is amount of units which are wasted or destroyed during production. Units that do not meet the standard can also be a part of abnormal spoilage. To calculate abnormal spoilage we will use formula below;
Abnormal Spoilage units = (Work in process beginning inventory + Units completed and transferred out) - (Units in work in process + Ending inventory units)
Abnormal Spoilage Units = (23,000 + 76,500) - (72,100 + 19,000) = 8,400 units.
Consider two stocks, Stock D, with an expected return of 19 percent and a standard deviation of 35 percent, and Stock I, an international company, with an expected return of 10 percent and a standard deviation of 15 percent. The correlation between the two stocks is –0.04. What is the weight of each stock in the minimum variance portfolio?
Answer:
[tex]W_D=0.0843\\W_I=0.9157[/tex]
Explanation:
A minimum variance portfolio is a portfolio that consists of individually assets which are risky, hedged when traded together, thereby producing the lowest possible risk for the rate of expected return. It reduces the risk of assets by hedging and trading them together.
Given that for stock D:
expected return([tex]E_d[/tex]) = 19% = 0.19 and a standard deviation ([tex]S_d[/tex])= 35% = 0.35
For stock I
expected return ([tex]E_i[/tex]) = 10% = 0.10 and a standard deviation ([tex]S_i[/tex]) = 15% = 0.15
Correlation = -0.04
The weight of stock D ([tex]W_D[/tex]) is given as:
[tex]W_D=\frac{S_i^2-(S_d*S_i*c)}{S_d^2+S_i^2-(2*S_d*S_i*c)} =\frac{0.1^2-(0.35*0.1*-0.04)}{0.35^2+0,1^2-(2*0.35*0.1*-0.04)}=0.0843[/tex]
[tex]W_I=1-W_D=1-0.0843=0.9157[/tex]
Final answer:
The weights of Stock D and Stock I in the minimum variance portfolio are calculated using the formula that takes into account their individual variances and the correlation between them. The resulting weights will balance the portfolio to minimize overall risk.
Explanation:
To calculate the weights of each stock in the minimum variance portfolio, we use the formula for the weights of two assets in such a portfolio:
Weight of Stock D (
wD) = (\sigmaI2 - \rhoDI\sigmaD\sigmaI) / (\sigmaD2 + \sigmaI2 - 2\rhoDI\sigmaD\sigmaI)
Weight of Stock I (
wI) = (\sigmaD2 - \rhoDI\sigmaD\sigmaI) / (\sigmaD2 + \sigmaI2 - 2\rhoDI\sigmaD\sigmaI)
Using the given values for Stock D and Stock I:
Expected return of Stock D: 19%Standard deviation of Stock D: 35%Expected return of Stock I: 10%Standard deviation of Stock I: 15%Correlation between Stock D and I: –0.04Substituting the values into the formulas gives us:
wD = (0.152 - (-0.04)(0.35)(0.15)) / (0.352 + 0.152 - 2(-0.04)(0.35)(0.15))wI = (0.352 - (-0.04)(0.35)(0.15)) / (0.352 + 0.152 - 2(-0.04)(0.35)(0.15))After calculations, we find the weights in the minimum variance portfolio:
wD: Weight of Stock D in the portfoliowI: Weight of Stock I in the portfolioQuarter-inch stainless-steel bolts, 1.5 inches long are consumed in a factory at a fairly steady rate of 50 per week. The bolts cost the plant 3 cents each. It costs the plant $10 to initiate an order, and holding costs are based on an annual interest rate of 20 percent.
a. Determine the optimal number of bolts for the plant to purchase and the time between the placement of orders
b. What is the yearly holding and setup cost for this item?
Answer:
a.
EOQ = 2,944 units
b.
Setup cost = Numbers of Order x Ordering cost = $8.83
Holding Cost = $8.83
Explanation:
a.
Economic order quantity is the quantity at which business incur minimum cost. This is the level of order where the holding cost equals to the ordering cost of the business.
As per given data
Annual Demand = 50 per week x 52 weeks in a year = 2,600 bolts
Ordering cost = $10
Carrying cost = $0.03 x 20% = $0.006
EOQ = [tex]\sqrt{\frac{2 X S X D}{H} }[/tex]
EOQ = [tex]\sqrt{\frac{2 X 10 X 2,600}{0.006} }[/tex]
EOQ = 2,943.92 = 2,944 units
b.
Setup cost = Numbers of Order x Ordering cost = (2,600 / 2,944) x $10 = $8.83
Holding Cost = (2,944 / 2) x $0.006 = $8.83
Blowing Sand Company has just received a one-time offer to purchase 9,400 units of its Gusty model for a price of $30 each. The Gusty model normally sells for $38 and costs $34 to produce ($24 in variable costs and $10 of fixed overhead). Because the offer came during a slow production month, Blowing Sand has enough excess capacity to accept the order. 1. Should Blowing Sand accept the special order
Answer:
Net income from special order = $56,400
Blowing Sand Company should accept the order because it will increase net income by $56,400
Explanation:
In order to carry out an incremental analysis, only relevant cash flows should be considered.
The relevant cash flows from accepting the special order are the variable costs and the sales revenue.
Please, note that the fixed costs are not relevant for this decision. Simply because they would be incurred either way.
1. The sales revenue from the order- $30 × 9400 = $282,000
2. the variable cost of production $24 per unit × 9,400 = $225,600
The contribution from the special order would be determined as follows:
Contribution from special order = sales revenue - variable cost
= $282,000 - $225,600
= $56,400
Blowing Sand Company should accept the order
Pearsall Company's defined benefit pension plan had a PBO of $268,000 on January 1, 2021. During 2021, pension benefits paid were $43,000. The discount rate for the plan for this year was 11%. Service cost for 2021 was $85,000. Plan assets (fair value) increased during the year by $46,000. The amount of the PBO at December 31, 2021, was:
Answer:
The correct answer is $339,480.
Explanation:
According to the scenario, the computation of the given data are as follows:
We can calculate the PBO at Dec.31 by using following formula:
PBO Dec.31 = PBO on Jan 1,2021 + Service cost + Interest - pension benefits paid
Where, Interest = 11 % × $268,000 = $29,480
By putting the value we get
PBO, Dec.31 = $268,000 + $85,000 + $29,480 - $43,000
= $339,480
Pittsboro Corporation produces and sells a single product. Data for that product are:Sales price per unit$500Variable cost per unit$320Fixed expenses for the month$1,000,000Currently selling4,000 unitsManagement is discussing increasing the price to $525 to cover an increase in fixed expenses of $80,000. Management believes they might lose 2% of sales per month. What should be the overall effect on the company's monthly operating income if this change is implemented?
Answer:
Increase in operating income $ 3,600
Explanation:
The impact on operating income will be done using incremental analysis.
Here we consider only the impact of the proposed change on the income
This is done as follows: $
Contribution before (4,000 × $(500- 320) = 720,000
Contribution after - (98%× 4,000)× (525-320) = 803,600
Increase in contribution 83600
Increase in Fixed expenses ( 80,000)
Increase in operating income 3,600
A__________is a network of facilities and processes that describes the flow of materials, finished goods, services, information, and financial transactions from suppliers, through the facilities and processes that create goods and services, and those that deliver them to the customer.
Answer: Value chain
Explanation: a. value chain
b. product life cycle
c. business cycle
d. product-process matrix
Value chain are the functional activities of a business that add value to its customer which include the flow of materials, finished goods, services, information, and financial transactions from suppliers, through the facilities and processes that create goods and services, and those that deliver them to the customer. It is essential in making it possible for products, information, and finances to flow through the business. This helps optimize these processes thus creating better value in the relationships between companies, its customers, including improvement in the overall efficiency of business.
A supply chain is a collection of structures and procedures that describes the movement of raw materials, manufactured items, services, data, and money from suppliers to consumers.
Explanation:A supply chain is a network of facilities and processes that describes the flow of materials, finished goods, services, information, and financial transactions from suppliers, through the facilities and processes that create goods and services, and those that deliver them to the customer. It involves the coordination and management of activities such as procurement, production, distribution, and customer service.
For example, let's say you are a customer ordering a new phone online. The supply chain begins with the suppliers who provide the raw materials, such as the components for the phone. The raw materials are then sent to manufacturing facilities, where the phones are assembled. From there, the phones are distributed to warehouses and ultimately delivered to the customer.
Efficient supply chain management is important for businesses to ensure timely delivery, minimize costs, and optimize customer satisfaction. It involves strategic decision-making, coordination, and effective communication between various stakeholders.
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Suppose First Main Street Bank, Second Republic Bank, and Third Fidelity Bank all have zero excess reserves. The required reserve ratio is 10%. The Federal Reserve buys a government bond worth $500,000 from Eric, a customer of First Main Street Bank. He deposits the money into his checking account at First Main Street Bank.The following table reflects any changes in First Main Street Bank's balance sheet (before the bank makes any new loans):Assets LiabilitiesLoans $500,000 Checkable Deposits $500,000The following table shows the effects of new deposit on excess and required reserves, assuming a required reserve ratio is 10%.Hint: If the change is negative, be sure to enter the value as a negative number.Amount Deposited (Dollars) Change in Excess Reserves (Dollars) Change in Required Reserves (Dollars)500,000 450,000 50,000Now, suppose First Main Street Bank loans out all of its new excess reserves to Cho, who immediately writes a check for the full amount to Bob. Bob then immediately deposits the funds into his checking account at Second Republic Bank. Then Second Republic Bank lends out all of its new excess reserves to Kenji, who writes a check to Ginny, who deposits the money in her account at Third Fidelity Bank. Finally, Third Fidelity lends out all of its new excess reserves to Lucia.Fill in the following table to show the effect of this ongoing chain of events at each banks. Enter each answer to the nearest dollar.Bank Increase in Checkable Deposits (Dollars) Increase in Required Reserves (Dollars) Increase in Loans (Dollars)First Main Street Bank Second Republic Bank Third Fidelity Bank Assume this process continues, with each successive loan deposited into a checking account and no banks keeping any excess reserves. Under these assumptions, the $500,000 injection into the money supply results in overall increase of ......................... in checkable deposits.
Answer:
Under these assumptions, the $500,000 injection into the money supply results in overall increase of 5,000,000 in checkable deposits.
Explanation:
Multiplier × Money supply
= 1 / 0.10 × 500,000
⇒ 5,000,000
First Main Street Bank
Increase in Checkable Deposits: 500,000
Increase in Required Reserves: 50,000
Increase in Loans: 450,000
Second Republic Bank
Increase in Checkable Deposits: 450,000
Increase in Required Reserves: 45,000
Increase in Loans: 405,000
Third Fidelity Bank
Increase in Checkable Deposits: 405,000
Increase in Required Reserves: 40,500
Increase in Loans: 364,500
On January 1, 2019, Wildhorse Co. issued $379,500, 7%, 5-year bonds at face value. Interest is payable annually on January 1. (a) Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1 (b) Prepare the journal entry to record the accrual of interest on December 31, 2019. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Dec. 31 (c) Prepare the journal entry to record the payment of interest on January 1, 2020. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Jan. 1 Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT Question Attempts: 0 of 4 used SAVE FOR LATER SUBMIT ANSWER
Answer:
See the explanation for the answer.
Explanation:
(a)
Bonds are issued at face value
date Account debit credit
Jan 1 ,2019 cash $379,500
bonds payable $379,500
[to record cash received
against bonds issued]
b.
Interest accrued from Jan-Dec = $379,500*7% = $26,565
Account
Dec 31 ,2019 Interest expense $26,565
Interest payable on bonds $26,565
As interest is accrued it will be expensed
.
However, it is not paid so it will be interest payable
c) Interest paid
Debit Credit
Jan 1 ,2020 Interest payable on bonds $26,565
Cash $26,565
Catamount Company had current and accumulated E&P of $500,000 at December 31, 20X3. On December 31, the company made a distribution of land to its sole shareholder, Caroline West. The land's fair market value was $200,000 and its tax and E&P basis to Catamount was $250,000. The tax consequences of the distribution to Catamount in 20X3 would be:
A. No loss recognized and a reduction in E&P of $250,000
B. $50,000 loss recognized and a reduction in E&P of $250,000
C. $50,000 loss recognized and a reduction in E&P of $150,000
D. No loss recognized and a reduction in E&P of $200,000
Answer:
D. No loss recognized and a reduction in E&P of $200,000
Explanation:
Given that:
Current and accumulated E&P : $500,000A distribution of land to its sole shareholder: $200,000E&P basis to Catamount : $250,000From that, we can see that the current and accumulated E&P is greater than its distribution of land so no loss would be reported so there will be reduction in earning and profits of the company of $200,000.
Hope it will find you well.
Cassandra's Boutique has 2,100 shares outstanding at a market price per share of $26. Sally's has 3,000 shares outstanding at a market price of $41 a share. Neither firm has any debt. Sally's is acquiring Cassandra's for $58,000 in cash. The incremental value of the acquisition is $2,000. What is the value of Cassandra's Boutique to Sally's?
Answer:
$56,600
Explanation:
Given that,
Cassandra's Boutique:
2,100 shares outstanding at a market price per share of $26.
Sally's:
3,000 shares outstanding at a market price of $41 a share.
Acquiring Cassandra's boutique for cash = $58,000
Incremental value of the acquisition = $2,000
We can get the value of Cassandra's Boutique to Sally's by adding the incremental value of the acquisition to the market value of the shares of Cassandra's Boutique.
Firstly, we are calculating the market value of Cassandra's Boutique:
= Outstanding shares × Market price per share
= 2,100 × $26
= $54,600
Therefore, the value of Cassandra's Boutique to Sally's is as follows:
= market value of Cassandra's Boutique + Incremental value of the acquisition
= $54,600 + $2,000
= $56,600
Final answer:
The value of Cassandra's Boutique to Sally's is the purchase price of $58,000 plus the incremental value of $2,000, which totals $60,000.
Explanation:
To determine the value of Cassandra's Boutique to Sally's in an acquisition scenario, we must first recognize the total purchase price and the incremental value of the acquisition. Sally's is buying Cassandra's for $58,000 in cash, and the incremental value of the acquisition is $2,000. Therefore, the value of Cassandra's Boutique to Sally's is the purchase price plus the incremental value.
The calculation is straightforward: $58,000 (purchase price) + $2,000 (incremental value) = $60,000. This amount represents the total value that Sally's places on Cassandra's Boutique, factoring in the synergies or additional benefits Sally's expects to gain from the acquisition.
Cash equivalents meet all of the following criteria except: Multiple Choice Readily convertible to a known cash amount. Short-term investments purchased within 3 months of their maturity dates. Have a market value that is not sensitive to interest rate changes. Short-term U.S. treasury bills. More liquid than cash.
Answer:
More liquid than cash is the correct option
Explanation:
Cash equivalents are cash or other short term assets can be converted into cash in no distant time without losing significant portion of its value.
All the options enumerated met the criteria cited above except the last option,cash equivalents are more liquid than cash.
Cash equivalents cannot be more liquid than cash since cash equivalents at best cash and at worst short term easily convertible assets.
The correct option therefore is the last option,more liquid than cash
Whispering Company purchased equipment for $286,800 on October 1, 2020. It is estimated that the equipment will have a useful life of 8 years and a salvage value of $13,200. Estimated production is 48,000 units and estimated working hours are 20,000. During 2020, Whispering uses the equipment for 550 hours and the equipment produces 1,000 units. Compute depreciation expense under each of the following methods. Whispering is on a calendar-year basis ending December 31. (Round rate per hour and rate per unit to 2 decimal places, e.g. 5.35 and final answers to 0 decimal places, e.g. 45,892.) (a) Straight-line method for 2020 $enter a dollar amount (b) Activity method (units of output) for 2020 $enter a dollar amount (c) Activity method (working hours) for 2020 $enter a dollar amount (d) Sum-of-the-years'-digits method for 2022 $enter a dollar amount (e) Double-declining-balance method for 2021 $enter a dollar amount
(a) $8,600
(b) $5,700
(c) $7,524
(d) $51,300 and
(e) $67,219
Explanation:
Given information's are
value of Equipment = $286,800 on October 1, 2020.
Accounting base = on a calendar-year basis ending December 31
(a) Straight-line method for 2020
Depreciation = value of Equipment - salvage value ÷ life span of Equipment
Depreciation = $286,800 - $13,200 ÷ 8 = $34,400
For 3 months from October 1st to 31st December 2020
= $34,400 ÷ 12 × 3 = $8,600
(b) Activity method (units of output) for 2020
Depreciation =Amount of Depreciation ÷ Total estimated production × unit produced during 2020
= $273,600 ÷ 48,000 = $5.7 × 1000 = $5,700
(c) Activity method (working hours) for 2020
Depreciation =Amount of Depreciation ÷ Total estimated working hours × working hours during 2020
= $273,600 ÷ 20,000 = $13.68 × 550 = $7,524
(d) Sum-of-the-years'-digits method for 2022
Instead of adding the individual digits in the years of the asset's useful life, the following formula can be used to compute the sum of the digits: n(n+1) divided by 2, where n = the useful life in years
Depreciate Cost = Original Cost - Salvage Value = (Cost - Salvage)
Fraction for a Given Period = (Life - Period + 1) / ((Life × (Life + 1)) / 2)
depreciation for 2022 is $51,300
(e) Double-declining-balance method for 2021
Double declining balance method is a form of an accelerated depreciation method in which the asset value is depreciated at twice the rate it is done in the straight-line method
Double Declining Balance = 2 X Cost of the asset X Depreciation rate
= 2 × $286,800 × 12.5 ÷100 = $67,219
To find the best production method, the total costs are calculated based on labor and capital costs. Initially, Method 1 is the most cost-effective. When labor costs rise, Method 1 is still the most economical choice.
Explanation:To determine the best production method, we calculate the total cost for each method by multiplying the number of units of labor and capital required by their respective costs. Initially, the cost of labor is $100/unit, and the cost of capital is $400/unit.
Method 1: (50 units of labor × $100) + (10 units of capital × $400) = $5,000 + $4,000 = $9,000Method 2: (20 units of labor × $100) + (40 units of capital × $400) = $2,000 + $16,000 = $18,000Method 3: (10 units of labor × $100) + (70 units of capital × $400) = $1,000 + $28,000 = $29,000Thus, Method 1 is the most cost-effective at the initial labor cost.
When the cost of labor rises to $200/unit, the calculations are:
Method 1: (50 units of labor × $200) + (10 units of capital × $400) = $10,000 + $4,000 = $14,000Method 2: (20 units of labor × $200) + (40 units of capital × $400) = $4,000 + $16,000 = $20,000Method 3: (10 units of labor × $200) + (70 units of capital × $400) = $2,000 + $28,000 = $30,000With the increased labor cost, Method 1 remains the most economical choice. Although Method 1's cost has increased, it has not surpassed the total cost of the other methods.
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The manufacturing overhead budget at Foshay Corporation is based on budgeted direct labor-hours. The direct labor budget indicates that 7,200 direct labor-hours will be required in May. The variable overhead rate is $8.90 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $134,640 per month, which includes depreciation of $24,880. All other fixed manufacturing overhead costs represent current cash flows. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for May should be:
Answer:
The predetermined overhead rate for May should be: $18.70 per direct labor hour
Explanation:
Predetermined Overhead rate is the rate that is used to allocate Overheads to Departments or Jobs.
Predetermined Overhead rate = Budgeted Overheads / Budgeted Activity
= $134,640/7,200
= $18.70 per direct labor hour
The Sisyphean Company's common stock is currently trading for $ 25.5 $25.5 per share. The stock is expected to pay a $ 2.5 $2.5 dividend at the end of the year and the Sisyphean Company's equity cost of capital is 15 15%. If the dividend payout rate is expected to remain constant, then the expected growth rate in the Sisyphean Company's earnings is closest to:
Answer:
5.2%
Explanation:
The computation of growth rate is shown below:-
Retained earning = (Expected dividend for the next year ÷ Current price of the stock) + Growth rate
15% = ($2.5 ÷ $25.5) + Growth rate
0.15 = $0.0980 + Growth rate
Growth rate = 0.15 - $0.0980
= $0.052
or
= 5.2%
So, for computing the growth rate we simply applied the above formula.
Eaton Electronics uses a periodic inventory system. On March 31, Eaton has two plasma TVs on hand at a cost of $1,800 each (serial numbers 11534892 and 11534894). In April, the company purchases four more identical TVs from Toshiba for $1,600 each (serial numbers 11542631 through 11542634). In May, the company purchases five more identical TVs for $1,900 each (serial numbers 11550964 through 11550968). In June, Eaton sells two of these TVs (serial numbers 11534894 and 11542631). There were no additional purchases or sales during the remainder of the year.
Eaton Electronics uses the specific identification method. What is its cost of goods sold?
a. $3,800
b. $3,533
c. $3,600
d. $3,400
Answer:
The cost of goods sold is $3400 and option D is the correct answer.
Explanation:
Specific identification method is a method for valuing ending inventory which requires a detailed physical count to determine what units of inventory are available to the company as closing inventory.
The cost of goods sold will be the sum of the costs of the specified inventory units which are sold.
The cost of goods sold for Eaton will include a TV from the beginning inventory for serial no 11534894 at a cost of $1800 and a TV from the April purchases with serial no 11542631 at a cost of $1600.
The cost of goods sold is thus = 1800 + 1600 = $3400
For the current year ending January 31, Ringo Company expects fixed costs of $178, 500 and a unit variable cost of $41.50. For the coming year, a new wage contract will increase the unit variable cost to $45. The selling price of $50 per unit is expected to remain the same. Compute the break-even sales (in units) for the current year. Compute the anticipated break-even sales (in units) for the coming year, assuming the new wage contract is signed.
Answer:
The break-even sales (in units u) for the current year is 210,000 units.
The anticipated break-even sales (in units t) for the coming year, assuming the new wage contract is signed is 357,000 units.
Explanation:
The BEP which is the break even point is the point where the company's sales or revenue generated is equal to the cost incurred. As such, the BEP is the number of units that must be sold for the company to make neither a profit nor a loss.
Both sales and variable cost are dependent on the number of units sold.
The sales less the variable cost gives the contribution margin. The contribution margin less the fixed cost gives the net operating income.
The break-even sales (in units u) for the current year
50u - 41.5u - 1785000 = 0
8.5u = 1785000
u = 1785000/8.5
= 210,000 units
The anticipated break-even sales (in units t) for the coming year, assuming the new wage contract is signed
50u - 45u - 1785000 = 0
5u = 1785000
u = 1785000/5
= 357,000 units
On January 1, Snipes Construction paid for earth-moving equipment by issuing a $320,000, 3-year note that specified 4% interest to be paid on December 31 of each year. The equipment’s retail cash price was unknown, but it was determined that a reasonable interest rate was 7%. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
what amount should Snipes record the equipment and the note?
Answer:
$294,803.84
Explanation:
The computation of the equipment and the note is shown below:
Rate = 7% and the time = 3 years
Cash flow Table Value Amount Present Value
Par (Maturity) Value 0.81629 $320,000 $261,212.80
Interest (Annuity)
($320,000 × 4%) 2.6243 $12,800 $33,591.04
Price of equipment $294,803.84
The 0.81629 is
= 1 ÷ 1.07^3
And, the 2.6243 is the PVIFA factor
Final Answer:
Snipes Construction should record the equipment and the note at $294,720.
Explanation:
To determine the amount Snipes should record for the equipment and the note, we need to find the present value of the note payable using the appropriate interest factor from the tables provided. Since the note is a 3-year, 4% interest-bearing instrument, we use the PV of $1 table for a 3-year period and 4% interest rate. The present value factor for this combination is 0.786.
Present Value of Note Payable = $320,000 × 0.786 = $251,520
Next, we need to find the present value of the note's interest payments. Since the interest is paid annually, we use the PVAD of $1 table for a 3-year period and 7% interest rate, as the equipment's retail cash price is considered to have an implied interest rate of 7%. The present value annuity factor for this combination is 2.676.
Present Value of Interest Payments = $320,000 × 4% × 2.676 = $43,200
The total present value of the note and interest payments is $251,520 + $43,200 = $294,720. Therefore, Snipes Construction should record the equipment and the note at $294,720.
Which of the following are true? Check all that apply. Most leadership theories and research studies have focused on female leaders. Top managers are increasingly responsible for maintaining high ethical standards for their own conduct, unfailingly exhibiting ethical behavior, and holding others in their organizations to the same standards. Some managers long accustomed to the traditional approach may have trouble changing to a coaching role. In Southern Asia, most employees want their leaders to be collaborative, sensitive to other people’s needs, and concerned with status and face saving.
Final answer:
Leadership research has traditionally focused on men, but recent studies highlight women's tendency towards a transformational leadership style. Ethical standards for top managers are heightened, demanding exemplary personal behavior. There's also an expectation in Southern Asia for leaders to be collaborative and sensitive to cultural norms.
Explanation:
The question examines the veracity of several statements regarding leadership theories, the ethical standards of top managers, the challenges faced by managers who may need to shift from a traditional approach to a coaching role, and cultural expectations for leadership in Southern Asia.
To address the statements:
Most leadership research historically focused on male leaders, not female leaders. However, more recent studies have given rise to a better understanding of female leadership styles. Women tend to exhibit an interpersonal or transformational leadership style, contrasting with men's tendency towards a more task-oriented or transactional style.Top managers are indeed being held to higher ethical standards in their conduct and are expected to exemplify and enforce ethical behavior in their organizations.Some managers accustomed to a traditional authoritative style might struggle with adopting a more engaged and supportive coaching role due to ingrained management practices that differ significantly from newer participative approaches.Cultural preferences for leadership styles indeed vary; for instance, employees in Southern Asia generally prefer leaders who are collaborative, attuned to people's needs, and sensitive to issues of status and face saving.It is therefore true that women do have different leadership styles compared to men, and that their contributions in leadership roles are increasingly being recognized and studied.
Suppose that a company needs 1,500,000 items during a year and that preparation for each production run costs $900. Suppose also that it costs $22 to produce each item and $3 per year to store an item. Use the inventory cost model to find the number of items in each production run so that the total costs of production and storage are minimized.
Answer:
30,000 units
Explanation:
According to the inventory cost model, the production run size that minimizes costs is given by:
[tex]P = \sqrt{\frac{2*D*S}{H}}[/tex]
Where D is the annual demand (1,500,000 items), S is the cost of each production run ($900) and H is the holding cost per unit ($3). Applying the given data:
[tex]P = \sqrt{\frac{2*1,500,000*900}{3}}\\P=30,000\ units[/tex]
Each production run should consist of 30,000 units.
Dreary Credit Agency uses a standard cost system for the processing of its credit applications. The labor standard at Dreary is 10 applications per 8 hour day at a standard cost of $15 per hour. During the last pay period, Dreary's credit agents worked 1,920 hours and processed 2,500 applications. The total labor cost for the agents during this period was $29,184. What was Dreary's labor efficiency variance for this last pay period
Answer:
The labor efficiency variance for this last pay period was $1,200 Favorable.
Explanation:
In order to calculate Dreary's labor efficiency variance for this last pay period, we have to calculate first the standard hours allowed for actual work using the following formula:
Standard hours
allowed for actual work= ( Total number of applications ) × number of
Standard number of applications hours worked
= (2.500 applications)× 8 hours
10 applications
=2,000 hours
After having calculated the Standard hours allowed for actual work, we can calculate the labor efficiency variance using the following formula:
labor efficiency variance= (Actual hours worked-Standard hours allowed for actual work)× standard rate
= (1,920-2,000)×$15
=-$1,200
The Labor efficiency variance is $1,200 Favorable.
Your goal is to have $12,500 in your bank account by the end of six years. If the interest rate remains constant at 9% and you want to make annual identical deposits, how much will you need to deposit in your account at the end of each year to reach your goal
Answer:
Annual deposit = $1,661.497
Explanation:
This investment scheme been considered is known as sinking funds.
A Sinking Fund involves saving a series of equal amount periodically invested at certain rate of interest to accumulate a target amount in the future.
The amount to be deposited periodically can be determined as follows:
A= FV/ ((1+r)^(n) - 1)/n)
A- annual deposit, FV- future value - $12,500 r- 9%, n- 6
So we can apply this formula as follows:
A = 12,500/ (1.09^(6)-1)/0.09
A = $1,661.497