Answer:
Average
Explanation:
(Hybrid costing) Pat Koontz makes necklaces from glass beads, metal beads, and natural beads. After reading about hybrid costing, she realized that the different types of necklaces did not cost the same amount of money to make, even though they took the same amount of time and effort to assemble. Koontz developed the following standard costs for each type of necklace:
Glass Metal Natural
Beads $24 $15 $ 7
Direct labor (1.5 hours) 15 15 15
Overhead (based on 1.5 hours) 8 8 8
Total $47 $38 $30
Koontz began 2010 with no beginning WIP Inventory after she experienced an extreme holiday rush. During January, 130 necklaces were started: 70 were glass, 25 were metal, and 35 were natural. At the end of January, 25 necklaces were not yet complete: 5 glass,13 metal, and 7 natural. The stage of completion for each cost component for the 25 unfinished necklaces was as follows:
Material 100% complete
Conversion 60% complete
a. Calculate the cost of necklaces completed during January.
b. Calculate the cost of necklaces in ending WIP Inventory.
Answer:
Pat Koontz
a. The cost of necklaces completed during January = $96.16
b. The cost of necklaces in ending WIP inventory = $24.40
Explanation:
a) Data and Calculations:
Glass Metal Natural Total
Beads $24 $15 $ 7 $46
Direct labor (1.5 hours) 15 15 15 45
Overhead (based on 1.5 hours) 8 8 8 24
Total cost of production $47 $38 $30 $115
Glass Metal Natural
Units started 70 25 35 130
Ending WIP 5 13 7 25
Units completed 65 12 28 105
Equivalent units:
Glass Metal Natural
Mat. Conv Mat. Conv Mat. Conv
Units completed 65 65 12 12 28 28
Ending WIP 5 3 13 8 7 4
Equivalent units 70 68 25 20 35 32
Cost per equivalent unit:
Glass Metal Natural
Mat. Conv Mat. Conv Mat. Conv Total
Cost of production $24 $23 $15 $23 $7 $23 $115
Equivalent units 70 68 25 20 35 32
Cost per equivalent $0.42 $0.34 $0.60 $1.15 $0.20 $0.72
Glass Metal Natural Total
Mat. Conv Mat. Conv Mat. Conv
Cost per equivalent $0.42 $0.34 $0.60 $1.15 $0.20 $0.72
Equivalent units of
Units completed 65 65 12 12 28 28
Units completed $27.3 $22.1 $7.2 $13.8 $5.6 $20.16 $96.16
Glass Metal Natural Total
Mat. Conv Mat. Conv Mat. Conv
Cost per equivalent $0.42 $0.34 $0.60 $1.15 $0.20 $0.72
Ending WIP (equiva.) 5 3 13 8 7 4
Total cost $2.1 $1.02 $7.8 $9.2 $1.4 $2.88 $24.40
12. Allen Steel Company is considering whether to build a new mill. If the interest rate falls, a. the present value of the returns from the mill will fall, so Allen will be less likely to build the mill. b. the present value of the returns from the mill will fall, so Allen will be more likely to build the mill. c. the present value of the returns from the mill will rise, so Allen will be less likely to build the mill. d. the present value of the returns from the mill will rise, so Allen will be more likely to build the mill.
Answer:
Allen Steel Company is considering whether to build a new mill. If the interest rate falls,
d. the present value of the returns from the mill will rise, so Allen will be more likely to build the mill.
Explanation:
A fall in the interest rate payable by Allen Steel Company will increase the present value of the returns that it can generate from building a new mill financed with debt. This is an incentive for investors to build more capital assets to increase productive activities in the economy. This is why the fall will most likely encourage Allen to build the mill.
A municipal power plant uses natural gas from an existing pipeline at an annual cost of $10,000 per year. A new pipeline would initially cost $35,000, but it would reduce the annual cost to $4000 per year. Assume an analysis period of 20 years and no salvage value for either pipeline. The interest rate is 7%. Using the equivalent uniform annual cost (EUAC), should the new pipeline be built
Answer: EUAC of new pipeline of $7,303.75 is less than the $10,000 of old pipeline so new pipeline should be built.
Explanation:
Equivalent Uniform Annual cost can be calculated as:
= Reduction in annual cost + (Initial Cost/ Present value interest factor of annuity, 7%, 20 years)
= 4,000 + (35,000 / 10.5940)
= 4,000 + 3,303.75
= $7,303.75
Matching. A shopper is in the grocery store, trying to decide whether to buy apples of a particular variety. Identify the food product attribute that most closely corresponds to each scenario. A. The shopper sees bruises on the apple. B. The shopper knows the apple variety tends to have a mealy texture. C. The shopper notices the PLU code, indicating the apple is USDA Organic.
Answer:
hi
Explanation:
hi i am new but i realy need this app
Uber and Lyft Drivers Go on Strike This activity is important because fairness gives employees observable evidence of trustworthiness of a manager, company or other source. Managers should know the types of justice and how they can exhibit those to gain trust. Trust is a strong predictor of organizational commitment and a moderate predictor of job performance. The goal of this exercise is to demonstrate your understanding of justice, by reading a case and answering questions that follow. Read the following case about Uber and Lyft and answer the questions that follow. Uber and Lyft drivers went on strike in several U.S. major cities the week of May 6, 2019, holding rallies and, in some cases, drivers not working for 12 to 24 hours. The drivers were protesting a pay decrease per mile and seeking better benefits. Lyft and Uber drivers are independent contractors, so they do not qualify for the same benefits and protections that govern typical employees. Drivers aren't guaranteed minimum wage or overtime, for example. Currently, Uber offers some benefits for high volume drivers, such as discounts on car repair and maintenance. Lyft and Uber have pushed back, with Lyft saying that most drivers work 10 hours or fewer a week and wouldn't qualify for benefits anyway. The timing of the strikes was no accident because Uber faced its IPO (initial public offering) the same week. Since then, Uber reported its largest quarterly loss in August 2019 of $5.2 billion. Furthermore, Lyft's shares fell 20% since its March 2019 IPO. If drivers were considered employees, they would get the same benefits and labor protection of other employees. Legally, they would be entitled to unemployment insurance, health care subsidies, overtime pay and a guaranteed minimum wage, among other rights. The lawsuit currently progressing through the court system in California is projected to be passed into law by the state senate. Uber and Lyft are not the only companies using "gig" workers. For example, another booming business model is food delivery, like Grubhub and DoorDash. Part of these companies' pushback is saying they will not be able to employ as many people due to the costs of benefits. In California, Uber is estimated to have 140,000 drivers and Lyft to have 80,000 drivers. Barclays, a renowned worldwide financial services company, estimated that benefits, payroll taxes and workers compensation would cost Uber $508 million per year and Lyft $290 million per year, assuming the same number of drivers were employed. In June 2019, Uber's and Lyft's top executives joined together to write an op ed in the San Francisco Chronicle to explain their arguments and promise to address the quality of work and job security. In their op ed, the executives sought to provide information to the public and drivers about their positions regarding providing benefits to drivers, showing the desire to increase justice. By relying on a respected source of information (Barclays), the executives appeared to use the rule of Multiple Choice procedural: truthfulness informational; procedure O Interpersonal: Informational O о informational; truthfulness interpersonal: procedure Drivers sought to advocate not just for full-time drivers, but part-time drivers too, seeking justice according to the rule of Multiple Choice О accuracy. propriety O O representativeness. volce. O truthfulness Drivers stated that they should have benefits that represent the number of hours they work, more for full-time drivers and fewer for part-time drivers, in the same way the company provides for their corporate employees. This suggests the drivers' desire for benefits allocated according to . a type of justice. Multiple Choice equity, procedural O need; procedural O O equality procedural U equity, distributive O O need: distributive Because the Uber and Lyft drivers sought a decision through the standard mechanisms of the court system, they appear to have focused on a desire for what type of justice?
a. procedural
b. interpersonal
c. informational
d. interdependent
e. distributive
Answer:
By relying on a respected source of information (Barclays), the executives appeared to use the rule of:
informational truthfulness.
Drivers sought to advocate not just for full-time drivers, but part-time drivers too, seeking justice according to the rule of:
rule of propriety
When drivers stated that they should have benefits that represent the number of hours they work, more for full-time drivers and fewer for part-time drivers, in the same way the company provides for their corporate employees. This suggests the drivers' desire for benefits allocated according to:
equity type of justice.
When Lyft drivers sought a decision through the standard mechanisms of the court system, they appear to have focused on a desire for:
a. procedural justice.
Explanation:
Procedural justice requires fairness in the administration of justice and legal proceedings
Interpersonal justice implies that authorities treat people fairly.
Informational justice requires the provision of adequate information or explanation for decisions.
Interdependent justice describes fairness based on other agency relationships.
Distributive justice refers to strict equal treatment of all.
Carter Corporation's partial income statement after its first year of operations is as follows: Income before income taxes $3,750,000 Income tax expense Current $1,035,000 Deferred 90,000 1,125,000 Net income $2,625,000 Carter uses the straight-line method of depreciation for financial reporting purposes and accelerated depreciation for tax purposes. The amount charged to depreciation expense on its books this year was $2,400,000. No other differences existed between book income and taxable income except for the amount of depreciation. Assuming a 20% tax rate, what amount was deducted for depreciation on the corporation's tax return for the current year
Answer: $2,850,000
Explanation:
The amount was deducted for depreciation on the corporation's tax return for the current year will be calculated as:
Defered income tax = $90,000
Tax rate = 20%
We will calculate the difference between the book income and the taxable income which will be:
= $90000 ÷ 20%
= $90000 × 100/20
= $90000 × 5
= $450000
Therefore, the amount that was deducted for depreciation on the corporation's tax return for the current year will be:
= $2,400,000 + $450,000
= $2,850,000
_____are short-term, specific targets which are attainable, measurable, and controllable.
A. Objective.
B. Policies.
C. Goal.
D. Standard operating procedures.
Answer:
A. Objective.
Explanation:
The objectives is the thing or the target that should be achieved it can be short term also there is some particular targets that could be achieved, measured and controlled
So according to the given situation, the correct option is a
Hence, the same would be considered
North Company has completed all of its operating budgets. The sales budget for the year shows 50,900 units and total sales of $2,301,800. The total unit cost of making one unit of sales is $23. Selling and administrative expenses are expected to be $303,800. Interest is estimated to be $11,820. Income taxes are estimated to be $200,800. Prepare a budgeted multiple-step income statement for the year ending December 31, 2020.
Answer:
North Company
Budgeted multiple-step income statement for the year ending December 31, 2020
Sales $2,301,800
Less Cost of Goods Sold (50,900 units x $23) ($1,170,700)
Gross Profit $1,131,100
Less Expenses
Operating Expenses
Selling and administrative expenses $303,800
Operating Profit $827,300
Non Operating Expenses
Interest $11,820
Income taxes $200,800
Net Income (Loss) $614,680
Explanation:
North Company budgeted multiple-step income statement for the year ending December 31, 2020 is prepared above.
Questionnaires on situational leadership often ask for respondents to look at specific applications of leadership styles within situations, which may result in _____. Group of answer choices negative perceptions toward organizations a wide range of responses that are hard to validate biased results in favor of situational leadership results that are not in favor of situational leadership
Answer:
biased results in favor of situational leadership.
Explanation:
A leader can be defined as an individual who is saddled with the responsibility of controlling, managing and maintaining a group of people under him or her.
Some types of power expressed by leaders are referent power, coercive, etc.
Situational leadership is a leadership style which typically involves the leader adapting his or her style to match or suit the current work environment and fits the level of development of the followers being led.
Questionnaires on situational leadership often ask for respondents to look at specific applications of leadership styles within situations, which may result in biased results in favor of situational leadership because each situation has a unique style that suits it.
Your company is estimated to make dividends payments of $2.1 next year, $3.6 the year after, and $4.2 in the year after that. The dividends will then grow at a constant rate of 6% per year. If the discount rate is 9% then what is the current stock price
Answer:
P0 = $122.79185 rounded off to $122.79
Explanation:
The dividend discount model (DDM) can be used to calculate the price of the stock today. DDM calculates the price of a stock based on the present value of the expected future dividends from the stock. The formula for price today under DDM is,
P0 = D1 / (1+r) + D2 / (1+r)^2 + ... + Dn / (1+r)^n + [(Dn * (1+g) / (r - g)) / (1+r)^n]
Where,
D1, D2, ... , Dn is the dividend expected in Year 1,2 and so ong is the constant growth rate in dividendsr is the discount rateP0 = 2.1 / (1+0.09) + 3.6 / (1+0.09)^2 + 4.2 / (1+0.09)^3 +
[(4.2 * (1+0.06) / (0.09 - 0.06)) / (1+0.09)^3]
P0 = $122.79185 rounded off to $122.79
Cost of Living The City of St. Albans has a unionized police force that is coming up for a contract renewal. The police have one issue: the cost of living increases. During the past 10 years, police officers have received minimal cost of living increases, and this time they want to match what other police forces are making. They claim that their salaries are below the national level. The incoming new police hire earns a salary of $48,200.
Required:
Prepare the data and an argument on behalf of the police officers to support their position.
Answer:
Police officers are national servants. Their salary needs to be adequate so that they can maintain their standard of living.
Explanation:
Police officers should be paid according to their level of skills and expertise. If they are paid below their minimal cost of living then they will feel demotivated and will not be able to justify their job role. They need to be self motivated with their adequate pay so they feel pride to serve the nation. The police officers should be paid equally to the new police hire salary which is $48,200.
John received a promotion at work and felt new clothes would be necessary in the new position. John went to a local store and charged three ties on his charge account at a cost of $60 each. Bill, a friend of John's, saw a sidewalk vendor selling ties at a cost of three for $10 and bought three at that price. The friends compared purchases that night and found that they had purchased identical ties. John became enraged and said that he would not pay the charge-account bill because the ties were clearly not worth $60 each. Bill indicated that he would testify on John's behalf if litigation ensued. What would be the probable outcome of the lawsuit
Answer:
John will lose the lawsuit
Explanation:
Businesses have a right to set the price of their products, and when the customers considers the price and agrees with it the deal is sealed.
In the given scenario John made the purchase at $60 per tie and he was satisfied with the sale at point of purchase.
He only became enraged when Bill told him he bought his identical ties at $10.
John will lose a lawsuit of he fails to pay the charge-account bill because he willingly agreed to the $60 per tie price.
You just decided to begin saving for retirement. You will make deposits of $1,000 per month into a retirement account that earns 8.00% p.a. The first deposit is made today and the last deposit will be made when you retire exactly 30 years from today. (Note: you make 361 total monthly deposits into your retirement account.) You will begin to make withdrawals from the account the first month after you retire. If you plan to live an additional 25 years and leave $900,000 to your heirs, you will be able to withdraw $_____ each month. (Note: you make 300 total monthly withdrawals from your retirement account.)
Answer:
Monthly withdraw= $4,752.01
Explanation:
Giving the following information:
Monthly deposit= $1,000
Number of perios= 361 months
Interest rate= 0.08/12= 0.0067
First, we need to calculate the Future Value at the moment of retirement:
FV= {A*[(1+i)^n-1]}/i
A= monthly deposit
FV= {1,000*[(1.0067^361) - 1]} / 0.0067
FV= $1,513,584.37
Now, we can calculate the monthly withdraw:
PV= 1,513,584.37 - 900,000= $613,584.27
Monthly withdraw= (FV*i) / [1 - (1+i)^(-n)]
Monthly withdraw= (613,584.37*0.0067) / [1 - (1.0067^-300)]
Monthly withdraw= $4,752.01
Select the true statement about default risk. It is the risk that the bond's price will fall below its par value. Bondholders have a degree of legal protection against default risk, but it is not comprehensive. Default risk relates to a bond's periodic coupon payments, but not to its maturity payment. Bondholders are guaranteed to be repaid in full if a company enters bankruptcy.
Answer:
Bondholders have a degree of legal protection against default risk, but it is not comprehensive.
Explanation:
A bond can be defined as a debt or fixed investment security, in which a bondholder (investor or creditor) loans an amount of money to the bond issuer (government or corporations) for a specific period of time. The bond issuer are expected to return the principal (face value) at maturity with an agreed upon interest (coupon), which are paid at fixed intervals.
The par value of a bond is its face value and it comprises of its total dollar amount as well as its maturity value. Also, the par value of a bond gives the basis on which periodic interest is paid. Thus, a bond is issued at par value when the market rate of interest is the same as the contract rate of interest. This simply means that, a bond would be issued at par (face) value when the bond's stated rated is significantly equal to the effective or market interest rate on the specific date it was issued.
In Economics, bonds could either be issued at discount or premium. A bond that is being issued at a discount has its stated rate lower than the market interest rate, on the specific date of issuance while a bond that is issued at a premium, has its stated rate higher than the market interest rate on the specific date of issuance.
Default risk in bonds refer to the risk that a bond issuer (borrower) is unable to pay the principal or interest agreed upon in the contract with the bondholder (lender) in a timely manner.
Hence, the true statement about default risk is that bondholders have a degree of legal protection against default risk, but it is not comprehensive.
The true statement about default risk is: Bondholders have a degree of legal protection against default risk, but it is not comprehensive, Hence option B is correct.
Default risk refers to the risk that a borrower, such as a company or government, will be unable to meet its financial obligations, including the payment of interest and the repayment of principal on a bond.
While bondholders may have some legal protections in place, such as collateral or contractual agreements, these protections are not always comprehensive and may vary depending on the specific bond and its terms.
Therefore, bondholders face the risk of potential default, even though they may have some level of legal protection.
Learn more about default risk here:
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Multipoint pricing occurs when a company buys products at a cheaper rate in one country to sell at a higher price in another country. allows markets to determine the pricing of a product. aggressively prices in one market to elicit a competitive response from a rival in another market. prices its products at a loss in order to drive out competitors from the market. prices two similar products at low and high prices in order to boost sales of the lower priced products.
Answer:
aggressively prices in one market to elicit a competitive response from a rival in another market.
Explanation:
Price can be defined as the amount of money that is required to be paid by a buyer (customer) to a seller (producer) in order to acquire goods and services.
In sales and marketing, pricing of products is considered to be an essential element of a business firm's marketing mix because place, promotion and product largely depends on it.
One of the importance associated with the pricing of products is that, it improves the image of a business firm.
Multipoint pricing occurs when a company aggressively prices in one market to elicit a competitive response from a rival in another market.
This ultimately implies that, a company's pricing strategy in one market is likely to impact the pricing strategy of its rival in another market.
Vaughn Manufacturing records purchases at net amounts. On May 5 Vaughn purchased merchandise on account, $79000, terms 2/10, n/30. Vaughn returned $6700 of the May 5 purchase and received credit on account. At May 31 the balance had not been paid. The amount to be recorded as a purchase return is
Answer:
Vaughn Manufacturing
Purchases at net value ($79000-2%) $77,420.00
Less: Purchase return ($6700-2%) $6,566.00
Net payable $70,854.00
The amount to be recorded as a purchase return is $6,566. When net method is used all purchase is recorded assuming discount will be availed. Similarly when goods are returned that amount is also adjusted with discount.
Scenario: You are in the market for a new car. You do not have a trade-in, but you have saved $3,000 toward a down payment. You currently earn $3,750.00 gross monthly income, of which 28% is withheld for various deductions. You have heard of the 20% rule of thumb, but want to limit your payments to no more than 18% of your net monthly income because of other debt commitments. You currently have a credit score of 685. You expect to drive the car an average 15,000 miles per year.
You're considering purchasing a used-rather than new car. This strategy offers several advantages. Which of the following is not an advantage of purchasing a used car?
A. The reduced down payment required for the purchase
B. A lack of knowledge and confidence in the mechanical condition of the car
C. The price of the automobile
D. Avoidance of the vehicle's significant decrease in value due to depreciation
Answer:
B. A lack of knowledge and confidence in the mechanical condition of the car.
Explanation:
One need to be expert in analyzing a car condition in order to buy a used car. The used car is mechanically weak and the buyer should have good knowledge for the mechanical condition of the car. This is a disadvantage if a person has lack of knowledge in car mechanic when in a situation to buy a used car.
The following information is available for Pioneer Company:
Sales price per unit is $100. November and December, sales were budgeted at 2,920 and 3,510 units, respectively. Variable costs are 11 percent of sales (6 percent commission, 3 percent advertising, 2 percent shipping). Fixed costs per month are sales salaries, $5,300; office salaries, $2,700; depreciation, $2,900; building rent, $4,000; insurance, $1,500; and utilities, $700..
Required:
Determine Pioneer's budgeted selling and administrative expenses for November and December.
Answer:
15
Explanation:
Dry-Sand Company is considering investing in a new project. The project will need an initial investment of $1,200,000 and will generate $600,000 (after-tax) cash flows for three years. However, at the end of the fourth year, the project will generate -$500,000 of after-tax cash flow due to dismantling costs. Calculate the MIRR (modified internal rate of return) for the project if the cost of capital is 15 percent. The reinvestment rate is 12 percent. Multiple Choice 20.4 percent 11.5 percent 28.2 percent 12.6 percent
Answer:
12.6 percent
Explanation:
The First Step is to Calculate the Terminal Value at end of year 4.
Terminal Value (FV) = Sum of (PV x (1 + r) ^ 4 - n)
= $600,000 x (1.15) ^ 3 + $600,000 x (1.15) ^ 2 + $600,000 x (1.15) ^ 1 - $500,000 x (1.15) ^ 0
= $912,525 + $793,500 + $690,000 - $500,000
= $1,896,025
The Next Step is to Calculate the MIRR using CFj Function of a Financial Calculator :
($1,200,000) CFj
0 CFj
0 CFj
0 CFj
$1,896,025 CFj
Now, Shift IRR/Yr we get 12.60 %
Therefore, the MIRR is 12.60 %.
Strongheart Enterprises anticipated selling 27,000 units of a major product and paying sales commissions of $6 per unit. Actual sales and sales commissions totaled 27,500 units and $171,400, respectively. If the company used a flexible budget for performance evaluations, Strongheart would report a cost variance of: Multiple Choice $6,400F. $9,400F. None of the answers is correct. $9,400U. $6,400U.
Answer:
Flexible budget cost variance= $6,400 unfavorable
Explanation:
To calculate the flexible budget cost variance, we need to use the following formula:
Flexible budget cost variance= (standard costs*actual quantity) - actual costs
Flexible budget cost variance= (6*27,500) - 171,400
Flexible budget cost variance= 165,000 - 171,400
Flexible budget cost variance= $6,400 unfavorable
Islander Inc. is a new firm in a rapidly growing industry. The company would be paying $2.50 in dividend next year. After that the company intends to grow the dividend at a 8% rate annually over a long period. You plan to buy the stock now and expect to sell it for $48.23 three years from now. What price must you pay now if your required rate of return is 10%
Answer: $42.93
Explanation:
To solve this question goes thus:
Year 1:
Cash flow = $2.50
PV at 10% = 0.9091
Present value = $2.27
Year 2:
Cash flow = $2.70
PV at 10% = 0.8264
Present value = $2.23
Year 3:
Cash flow = $2.92
PV at 10% = 0.7513
Present value = $2.19
Price at Year 3:
Cash flow = $48.23
PV at 10% = 0.7513
Present value = $36.24
Price to be paid = $2.27 + $2.23 + $2.19 + $36.24 = $42.93
In late 2020, the Nicklaus Corporation was formed. The corporate charter authorizes the issuance of 6,000,000 shares of common stock carrying a $1 par value, and 2,000,000 shares of $5 par value, noncumulative, nonparticipating preferred stock. On January 2, 2021, 4,000,000 shares of the common stock are issued in exchange for cash at an average price of $10 per share. Also on January 2, all 2,000,000 shares of preferred stock are issued at $20 per share. Required: 1. Prepare journal entries to record these transactions. 2. Prepare the shareholders' equity section of the Nicklaus balance sheet as of March 31, 2021. (Assume net income for the first quarter 2021 was $1,600,000.)
Answer:
1. Jan-02
Dr Cash $ 40,000,000.00
Cr Common stock $ 4,000,000.00
Cr Paid-in capital – excess of par, common $ 36,000,000.00
Jan 02
Dr Cash $ 40,000,000.00
Cr Preferred stock $ 10,000,000.00
Cr Paid-in capital – excess of par, preferred $ 30,000,000.00
2. $81,600,000.00
Explanation:
1. Preparation of the journal entries to record these transactions
Jan-02
Dr Cash (4,000,000 x $10) $ 40,000,000.00
Cr Common stock ($1 par x 4,000,000 shares) $ 4,000,000.00
Cr Paid-in capital – excess of par, common $ 36,000,000.00
Jan 02 Cash (amount received) (2,000,000 x $20) $ 40,000,000.00
Preferred stock ($5 par x 2,000,000 shares) $ 10,000,000.00
Paid-in capital – excess of par, preferred (difference) $ 30,000,000.00
2. Preparation of the shareholders' equity section of the Nicklaus balance sheet as of March 31, 2021.
Nicklaus Corporation
Balance Sheet-Shareholders' Equity Section
September 30, 2018
Shareholders' equity
Preferred stock, $5 par, authorized 2,000,000 shares, issued and outstanding 2,000,000 shares$ 10,000,000
Common stock, $1 par, authorized 6,000,000 shares, issued and outstanding 4,000,000 shares $ 4,000,000.00
Paid-in capital – excess of par $ 66,000,000.00
Retained earnings $ 1,600,000.00
Total shareholders' equity$ 81,600,000.00
Velocity, a consulting firm, enters into a contract to help Burger Boy, a fast-food restaurant, design a marketing strategy to compete with Burger King. The contract spans eight months. Burger Boy promises to pay $93,000 at the end of each month. At the end of the contract, Velocity either will give Burger Boy a refund of $31,000 or will be entitled to an additional $31,000 bonus, depending on whether sales at Burger Boy at year-end have increased to a target level. At the inception of the contract, Velocity estimates an 80% chance that it will earn the $31,000 bonus and calculates the contract price based on the expected value of future payments to be received. At the start of the fifth month, circumstances change, and Velocity revises to 60% its estimate of the probability that it will earn the bonus. At the end of the contract, Velocity receives the additional consideration of $31,000. At the end of the contract, Velocity receives the additional consideration of $29,000.
Required:
a. Prepare the journal entry to record revenue each month for the first four months of the contract.
b. Prepare the journal entry that the Velocity Company would record after four months to recognize the change in estimate associated with the reduced likelihood that the bonus will be received.
c. Prepare the journal entry to record the revenue each month for the second four months of the contract.
d. Prepare the journal entry after eight months to record receipt of the cash bonus.
Answer:
a. Accounts Receivable (Dr.) $93,000
Bonus Receivable (Dr.) $2,325
Service Revenue (Cr.) $95,325
b. Service Revenue (Dr.) $9,300
Bonus receivable (Cr.) $9,300
c. Accounts Receivable (Dr.) $93,775
Bonus Receivable (Dr.) $775
Service Revenue (Cr.) $93,000
d. Cash (Dr.) $29,000
Bonus Receivable (Cr.) $29,000
Explanation:
The contract between Burger Boy and Velocity is for eight months.
Expected value of the contract on 1st month is :
80% * [ $93,000 * 8 months + $31,000 ] + 20% [ $93,000 * 8 months - $31,000] = $762,600
The expected value per month is $762,600 / 8 months = $95,325 per month
Expected value of the contract 5th month with revised probability is :
60% * [ $93,000 * 8 months + $31,000 ] + 40% [ $93,000 * 8 months - $31,000] = $750,200
The expected value per month is $750,200 / 8 months = $93,775 per month.
Miramar Industries manufactures two products, A and B. The manufacturing operation involves three overhead activities - production setup, material handling, and general factory activities. Miramar uses activity-based costing to allocate overhead to products. An activity analysis of the overhead revealed the following estimated costs and activity bases for these activities:
Activity Cost Activity Base
Production Setup $250,000 Number of setups
Material Handling $150,000 Number of parts
General Overhead $80,000 Number of direct labor hours
Each productâs total activity in each of the three areas are as follows:
Product A Product B
Number of setups 100 300
Number of parts 40,000 20,000
Number of direct labor hours 9,000 12,000
What is the activity rate for General Overhead?
A. $4.00 per direct labor hour
B. $3.81 per direct labor hour
C. $6.71 per direct labor hour
D. $4.20 per direct labor hour
Answer:
General overhead= $3.81 per direct labor hour
Explanation:
Given the following information:
General Overhead $80,000 Number of direct labor hours
Number of direct labor hours 9,000 12,000= 21,000
To calculate the activity rate, we need to use the following formula:
Activity rate= estimated costs / total amount of allocation rate
General Overhead= 80,000 / 21,000
General overhead= $3.81 per direct labor hour
In this exhibit (Simultaneous Shifts in Demand and Supply), D1 and S1 are original supply and demand curves, and S2 and D2 are new curves. In this market, the change in supply may have resulted from: Select one: a. wage increases for the workers. b. an improvement in technology. c. a decrease in the number of sellers. d. all of the above.
Answer:
Simultaneous Shifts in Demand and Supply
In this market, the change in supply may have resulted from:
b. an improvement in technology.
Explanation:
An improvement in technology is the only correct option that can cause the change in supply from S1 to S2. Wage increases for the workers increase the cost of production, which can decrease sales volume. Similarly, a decrease in the number of sellers will most likely reduce sales volume instead of increasing it.
As a result of a thorough physical inventory, Sheridan Company determined that it had inventory worth $320800 at December 31, 2020. This count did not take into consideration the following facts: Herschel Consignment currently has goods worth $46300 on its sales floor that belong to Sheridan but are being sold on consignment by Herschel. The selling price of these goods is $74900. Sheridan purchased $22000 of goods that were shipped on December 27, FOB destination, that will be received by Sheridan on January 3. Determine the correct amount of inventory that Sheridan should report.
Answer:
Sheridan Company
The correct amount of inventory that Sheridan should report is:
= $367,100
Explanation:
a) Data and Calculations:
December 31 Inventory based on physical inventory = $320,800
Goods held on consignment by Herschel = 46,300
December 27, FOB destination goods ($22,000) 0
Correct amount of inventory that Sheridan should report $367,100
b) Goods on consignment are generally the property of the consignor (supplier) and not the consignee's (retailer's). Therefore, they must appear in the balance sheet of the consignor. Goods on FOB destination remain the property of the supplier until they reach the buyer's destination. This is why it is not included above.
3. _________ is a type of form used to obtain important feedback from customers by
asking them to answer checklist.
A. Survey form
B. Bio-data form
C. Interview form
D. Health check form
4. This social benefit from patronizing products and services project how customers
wants to be ________ by others.
A. admired
B. accepted
C. perceived
D. acknowledged
5. Marketing companies exert effort to consider positive feelings provided to customers
in order to create __________ connection with them.
A. Social
B. Emotional
C. Functional
D. Economical
Answer:
3. Survey form
4. accepted
5. emotional
Explanation:
For the year, Redder Company has cost of goods manufactured of $600,000, beginning finished goods inventory of $200,000, and ending finished goods inventory of $250,000. The cost of goods sold is
Answer:
finished cost = $200,000
inventory cost=$250,000
manufactured cost= $600,000
cost of good= beginning inventory+purchase during period cost- ending inventory
$600,000+$200,000-$250,000
$550,000
The Sisyphean Company is planning on investing in a new project. This will involve the purchase of some new machinery costing $400,000. The Sisyphean Company expects cash inflows from this project as detailed below: Year 1 Year 2 Year 3 Year 4 $157,452.975 / $157,452.975/ $157,452.975/ $157,452.975 The appropriate discount rate for this project is 15%. The internal rate of return (IRR) for this project is closest to ________.
Answer:
21%
Explanation:
Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
Cash flow in year 0 = $-400,000.
Cash flow in year 1 - 4 = $157,452.975
IRR = 21%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
The Assembly Department for Right pens has the following production data for the current month.
Beginning Work in Process Units Transferred Out Ending Work in Process
0 15,000 10,000
Materials are entered at the beginning of the process. The ending work in process units are 50% complete as to conversion costs.
Compute the equivalent units of production for (a) materials and (b) conversion costs.
Answer:
(a) materials = 25,000 units and
(b) conversion costs = 20,000 units
Explanation:
Note : I will assume the Weighted Average Cost Method for this question since the information provided allows so.
The equivalent units of production for
(a) materials and
Units Completed and Transferred 15,000
Units in ending Work in Process 10,000
Total 25,000
(b) conversion costs.
Units Completed and Transferred 15,000
Units in ending Work in Process 5,000
Total 20,000