Answer:
$500
Explanation:
2012 Income Statement
Revenue $2,000
Expenses
Wages incurred and paid $500
Salaries $400
Interest on bank loans $600 $1,500
Net Income $500
So, the amount of $500 will be shown as Net Income on the 2012 Income Statement.
Your neighbor never mows his lawn. You don’t have any legal right to force him to mow, but the mess in his front yard is making your neighborhood unsightly and reducing the value of your house. The reduction in the value of your house is $5,000, and the value of his time to mow the lawn once a week is $1,000. Suppose you offer him a deal in which you pay him $3,000 to mow. How does this deal affect surplus?
Answer: The deal will have the effect of increasing both your surplus as well as your neighbor's
Explanation:
Assuming your neighbor accepts the deal, you would have paid $3,000 when in fact your house value had reduced by $5,000. This give you a surplus of $2,000 because you paid $2,000 less than the cost to you if your neighbor did not mow the lawn.
Your neighbor also makes a surplus because where normally it would cost them $1,000 to mow the lawn, they got $3,000. They also make a surplus of $2,000 over the cost to mow.
On January 1, Balanger Company buys 10 percent of the outstanding shares of its parent, Altgeld, Inc. Although the total book and fair values of Altgeld's net assets equaled $3.2 million, the price paid for these shares was $340,000. During the year, Altgeld reported $415,000 of separate operating income (no subsidiary income was included) and declared dividends of $35,000. How are the shares of the parent owned by the subsidiary reported at December 31
Answer: a. Consolidated stockholders’ equity is reduced by $340,000.
Explanation:
Consolidated stockholders' equity is the equity owned by stockholders in the entire parent company of Altgeld and its subsidiaries. Balanger as a company, then buys some of its parent's stock for $340,000.
The effect this will have is to reduce the stock available to stockholders in the parent and the subsidiaries almost like buying treasury shares. Consolidated stockholders' equity will therefore reduce by the amount paid for the shares of $340,000.
OM, Inc. was organized on January 1, 2020. The firm was authorized to issue 1,000,000 shares of $2 par value common stock. During 2020, OM had the following transactions relating to stockholders' equity: Issued 20,000 shares of common stock at $7 per share. Issued 40,000 shares of common stock at $8 per share. Reported a net income of $100,000. Paid dividends of $50,000. What is the total amount recorded in the Common Stock account at the end of 2020
Answer:
$120,000
Explanation:
It is important to identify whether the Common Stock have a stated Par Value or No Par Value from the Authorized Capital. In this case the Common Stock are stated at a $2 par value. With Par Value Stated Shares, any price paid in excess of the Par Value is Accounted for in a reserve called Paid in Excess of Par or Stock Premium.
Transaction 1
Cash $140,000 (debit)
Common Stock $40,000 (credit)
Paid In Excess of Par $100,000 (credit)
Transaction 2
Cash $320,000 (debit)
Common Stock $80,000 (credit)
Paid In Excess of Par $240,000 (credit)
Therefore,
Total Common Stock at the end of 2020 will be $120,000 ($40,000 + $80,000).
Swifty Corporation is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6380000 on March 1, $5270000 on June 1, and $8350000 on December 31. Swifty Corporation borrowed $3240000 on January 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $6380000 note payable and an 11%, 4-year, $12650000 note payable. What is the actual interest for Swifty Corporation
Answer:
Swifty Corporation
The actual interest for Swifty Corporation is:
$2,418,300
Explanation:
a) Data and Calculations:
Expenditures were
on March 1, $6,380,000
on June 1, $5,270,000
on December 31 $8,350,000
Borrowings:
on January 1 on a 5-year, 12% note = $3,240,000 Interest = $388,800
Note payable, 10%, 3-year = $6,380,000 Interest = $638,000
Note payable, 11%, 4-year = $12,650,000 Interest = $1,391,500
Total interest for Swifty Corporation = $2,418,300
b) Computation of interests:
12% note = $3,240,000 * 12% = $388,800
10% note = $6,380,000 * 10% = $638,000
11% note = $12,650,000 * 11% = $1,391,500
Privett Company Accounts payable $34,234 Accounts receivable 69,135 Accrued liabilities 6,513 Cash 15,673 Intangible assets 43,529 Inventory 71,631 Long-term investments 90,421 Long-term liabilities 76,608 Marketable securities 31,804 Notes payable (short-term) 21,712 Property, plant, and equipment 614,336 Prepaid expenses 1,617 Based on the data for Privett Company, what is the quick ratio, rounded to one decimal point
Answer:
1.87%
Explanation:
Based on the above information, the formula for Quick ratio is
= ( Cash + Marketable securities + Accounts receivables ) / Current liabilities
Where;
Cash = $15,673
Marketable securities = $31,804
Accounts receivables = $69,135
Current liabilities = Accounts payable + Accrued liabilities + Notes payable
= $34,234 + $6,513 + $21,712
= $62,459
Quick ratio
= ($15,673 + $31,804 + $69,135) / $62,459
= $116,612 / $62,459
= 1.87%
Margaret Lindley paid $15,040 of interest on her $300,400 acquisition debt for her home (fair market value of $500,400), $4,040 of interest on her $30,040 home-equity loan, $1,040 of credit card interest, and $3,040 of margin interest for the purchase of stock. Assume that Margaret Lindley has $10,040 of interest income this year and no investment expenses. How much of the interest expense may she deduct this year
Answer:
$23,160
Explanation:
The Total interest = 15,040 + 4040 + 1040 + 3040
Total interest = $23,160
Hence, the Interest deductable this year = $23,160
Ivanhoe Corporation, a manufacturer of Mexican foods, contracted in 2020 to purchase 1000 pounds of a spice mixture at $4.00 per pound, delivery to be made in spring of 2021. By 12/31/20, the price per pound of the spice mixture had dropped to $3.70 per pound. In 2020, Ivanhoe should recognize:______________
LAnswer:
Loss of $300
Explanation:
Calculation for the what Ivanhoe should recognize in 2020
2020 Recognized Amount=(1,000 pound*$4.00 per pound)-(1,000 pound*$3.70 per pound)
2020 Recognized Amount=4,000 pound-3,700 pound
2020 Recognized Amount=300 pound
Therefore what Ivanhoe should recognize in 2020 is LOSS of 300 pound
On January 1, 2020, Global Sales issued $25,000 in bonds for $29,800. These are eight-year bonds with a stated rate of 15% and pay semiannual interest. Global Sales uses the straight-line method to amortize the bond premium. On June 30, 2020, when Global makes the first payment to bondholders, what is the amount that will be reported as Interest Expense? (Round your intermediate answers to the nearest dollar.) Group of answer choices $1575 $3225 $1875 $1225
Answer:
$ 1,875
Explanation:
Note that cash payable to bondholders semiannually( semiannual coupon payment) is the face value multiplied by the stated rate of 15% apportioned to reflect six-month payment rather than a whole year as computed below:
semiannual coupon payment=face value*coupon rate*6/12
face value=$25,000
coupon rate=15%
semiannual coupon payment=$25,000*15%*6/12
semiannual coupon payment=$1,875
why does crime exist?
Answer:
well for me I think
Explanation:
The world is polluted
Katherine Kocher has determined the following information about her own financial situation. Her checking account is worth $850 and her savings account is worth $1,200. She owns her own home that has a market value of $98,000. She has furniture and appliances worth $12,000 and a home computer and laptop worth $3,300. She has a car worth $12,500. She has recently purchased a mutual fund worth $5,500 and she has a retirement account worth $38,550. What is the value of her personal possessions
Answer:
Katherine Kocher
The value of her personal possessions is:
$171,900
Explanation:
a) Data and Calculations:
Checking account = $850
Savings account = 1,200
Home value = 98,000
Furniture & appliances 12,000
Home computer/laptop 3,300
Car 12,500
Investments:
Mutual fund 5,500
Retirement account 38,550
Total value = $171,900
b) Katherine's personal possessions include all her personal assets. Her net worth will be the difference between all her personal assets and her personal debts or liabilities.
Diego Garcia is 32 years old. Diego earned $112,000 in 2020 while employed as a financial analyst. The combined CPP and El deduction during 2020 totaled
$3,754. Of this amount, $166 was the CPP enhanced contribution. The following information was also provided pertaining to the 2020 taxation year:
a) Diego enrolled in part-time studies at the local university, paying tuition fees of $1,500.
b) Diego donated $2,000 to a registered charity for tax purposes, and $800 to a federal political party.
c) During the year, a total of $4,500 was spent on eyeglasses, dental care, and prescriptions, and none of this amount was reimbursed.
d) Diego's spouse did not work during 2020 while attending full-time post-secondary classes which cost $8,000 in tuition. The maximum allowed amount was
transferred to Diego for 2020 tax purposes. Diego's spouse had no other income during the year.
e) Diego ha a $2,000 non-capital loss from 2019.
f) The couple does not have any children.
Required:
A. Calculate Diego's taxable income for 2020.
B. Calculate Diego's federal tax liability for 2020.
If someone knows this.. please help
Answer:
the answer is A
Explanation:
Zepol Company is planning to produce 600,000 power drills for the coming year. The company uses direct labor hours to assign overhead to products. Each drill requires 0.75 standard hour of labor for completion. The total budgeted overhead was $1,777,500. The total fixed overhead budgeted for the coming year is $832,500. Predetermined overhead rates are calculated using expected production, measured in direct labor hours. Actual results for the year are:
Answer:
Actual results are missing, so I looked for a similar question and found:
Actual results for the year are: Actual production (units) 594,000 Actual variable overhead $928,000 Actual direct labor hours (AH) 446,000 Actual fixed overhead $835,600
1. Compute the applied fixed overhead
2. Compute the fixed overhead spending and volume variances
1) budgeted labor hours = 600,000 units x 0.75 labors hours per unit = 450,000 labor hours
standard fixed overhead rate = $832,500 / 450,000 labor hours = $1.85 per labor hour
applied fixed overhead = actual labor hours x standard fixed overhead rate = 446,000 x $1.85 = $825,100
2) Fixed overhead volume variance = applied fixed overhead – budgeted fixed overhead = $825,100 - $832,500 = -$7,400 favorable
Fixed overhead spending variance = actual fixed overhead - applied fixed overhead = $835,600 - $825,100 = $10,500 unfavorable
total fixed overhead variance = -$7,400 + $10,500 = $3,100 unfavorable
HELP PLEASE 30 points !
Mary is an agent who works with a direct marketing insurance company. She is more specially known as a(n) ..
A - Broker agent
B- Independent agent
C- Certified agent
D- Captive agent
Answer:
i say broker agent.......
Answer:
It's D! Captive Agent is the correct answer.
One week, Rachel earned $250. She spent $120 on food, $30 on miscellaneous items, and saved the rest. If Rachel makes a pie chart showing how she spends her money, the central angle for the food sector would be __________.
360° = $250
? =.$120
120×360= 43200
43200÷250
=172.8°
Dukelow Corporation has two divisions: the Governmental Products Division and the Export Products Division. The Governmental Products Division's divisional segment margin is $41,300 and the Export Products Division's divisional segment margin is $93,700. The total amount of common fixed expenses not traceable to the individual divisions is $106,800. What is the company's net operating income (loss)?Brewer 8e Rechecks 2018-06-22a) $241,800b) $135,000c) $28,200d) $135,000
Answer:
c) $28,200
Explanation:
The computation of the net operating income is as follows
Total segment margin is
= $41,300 + $93,700
= $135,000
And, the common fixed expenses is $106,800
So, the net operating income is
= Total segment margin - common fixed expenses
= $135,000 - $106,800
= $28,200
Hence, the net operating income is $28,200
Therefore the correct option is c.
Sue invested $5,000 in the ABC Limited Partnership and received a 10 percent interest in the partnership. The partnership had $20,000 of debt she is not responsible to repay because she is a limited partner. Sue is allocated a 10 percent share of the debt resulting in a tax basis of $7,000 and an at-risk amount of $5,000. During the year, ABC LP generated a ($70,000) loss. How much of Sue's loss is disallowed due to her tax basis or at-risk amount
Answer:
$2,000
Explanation:
Calculation for How much of the Sue's loss is disallowed due to her tax basis or at-risk amount
Based on the information given we were told that that Sue is been allocated a 10% of the debt which resulted in a tax basis of the amount of $7,000 as well as an at-risk amount of $5,000 which means that the amount that the Sue's loss will be disallowed due to her tax basis Amount or at-risk amount will be calculated as :
Using this formula
Disallowed Sue's loss=Tax basis-At-risk amount
Let plug in the formula
Disallowed Sue's loss=$7,000-$5,000
Disallowed Sue's loss=$2,000
Therefore How much of the Sue's loss is disallowed due to her tax basis or at-risk amount will be $2,000
Onofkp411 Corporation has a time contraint on one of its special machines. The company makes three products that use this machine. Data concerning those products appear below: Magnifico Bellissimo Lovely
Selling price per unit $ 335.18 $ 228.46 $ 199.21
Variable cost per unit $ 259.26 $ 173.08 $ 159.61
Minutes on the constraint 7.50 4.30 5.50
Assume that sufficient time is available on the constrained machine to satisfy demand for all but the least profitable product Q) Up to how much should Onofkp 411 be willing to pay to acquire more of the constrained resource (Round your intermediate calculations to 2 decimal places.)
a) $75.80 per minute
b) $14.17 per unit
c) $39.48 per unit
d) $774 per minute
Answer: $7.20 per minute
Explanation:
Find out the profitability of each product as Contribution Margin per minute.
Magnifico
Contribution margin per minute = (Selling price - Variable cost) / minutes on the constraint
= (335.18 - 259.26) / 7.5
= $10.12 per minute
Bellissimo
= (228.46 - 173.08) / 4.3
= $12.88 per minute
Lovely
= (199.21 - 159.61) / 5.5
= $7.20 per minute
Their least profitable product is $7.20 per minute.
The machine does not have sufficient time to satisfy the needs of Lovely so they will have to pay more to acquire more of the resource but they should not pay anything more than $7.20 per minute as this is their contribution margin for the product. and anything more would result in a loss.
Options are most probably for another variant of the question.
An important first step in adapting a product to a foreign market is to determine the Group of answer choices personal ethics of individuals in the target market. language problem of the intended market. product's compliancy to irrational beliefs of its potential foreign consumers. regional political parties present in the domestic market. degree of newness of the product as perceived by the intended market.
Answer:
degree of newness of the product as perceived by the intended market.
Explanation:
As the new product is in the market so the willing of the consumers are to evaluate the production that depends upon the product newness in the market
The other options are incorrect as if the evaluation of the consumers depend upon the irrational beliefs so it would not be intended to purchased
Therefore the last option is correct
hence, the same is to be considered
Aikman, Inc., manufactures and sells two products: Product O6 and Product O7.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below:
The direct labor rate is $17.50 per DLH.The direct materials cost per unit for each product is given below:
The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
The unit product cost of Product O6 is closest to:
A) $637.15 per unit
B) $896.71 per unit
C) $721.00 per unit
D) $661.45 per unit
Question Completion:
Aikman, Inc., manufactures and sells two products: Product O6 and Product O7.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below:
Expected DLH Total DLH
Production
Product 06 200 9.00 1,800
Product 07 800 10.00 8,000
Total 1,000 9,800
The direct labor rate is $17.50 per DLH.The direct materials cost per unit for each product is given below:
Direct Materials
Costs / unit
Product 06 $206.50
Product 07 $162.30
The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Activity Activity Estimated Product 06 Product 07 Total
Pool Measure Overhead
Labor-related DLHs $133,770 1,800 8,000 9,800
Product orders Orders 18,501 400 300 700
Order size MHs 145,180 3,000 3,100 6,100
Total $297,451
Answer:
Aikman, Inc.
The unit product cost of Product O6 is closest to:
B) $896.71 per unit
Explanation:
a) Data and Calculations:
Product 06 Product 07
Direct Materials costs $206.50 $162.30
Direct labor costs $157.50 $175.00
Overhead cost per unit $532.71 $238.64
Total cost per unit $896.71 $575.94
Product 06 Product 07
Direct labor costs 1,800 8,000
Direct labor rate $17.50 $17.50
Total labor costs $31,500 $140,000
Units of products 200 800
Labor cost per unit $157.50 $175.00
Overhead cost Allocation Product 06 Product 07 Total
Labor-related ($13.65) $24,570 $109,200 $133,770
Product orders ($26.43) 10,572 7,929 18,501
Order size ($23.80) 71,400 73,780 145,180
Total $106,542 $190,909 $297,451
Production units 200 800
Overhead cost per unit $532.71 $238.64
A company expects a shortage of raw materials required for production. What kind of factor is influencing its buying decision?
A.
individual
B.
interpersonal
C.
environmental
D.
organizational
Answer:
C.) Enviromental
Explanation:
Got this right on plato
Answer:
C
Explanation: I got it right on edmentum
Nesrin purchased a $325,000 house and paid 25 percent down. She got a 30-year fixed-rate mortgage with an annual interest rate of 5.75 percent. After five years she refinanced the mortgage for 25 years at a 5.35 percent annual interest rate. After she refinanced, what is the new monthly payment (to the nearest dollar)
Answer:
$1,335.01
Explanation:
First step
PV = -325000 * (1-25%) = -243750
N = 30*12 = 360
I/Y = 5.75%/12
FV = 0
Using the Financial calculator
CPT PMT = PMT (-PV, N, I/Y, FV)
CPT PMT = $1,422.46
Second Step
PMT = 1422.46
PV = -325000*(1-25%) = -243,750
I/Y=5.75%/12
N = 12*5 = 60
Using the Financial calculator
CPT FV = FV(PMT, -PV, I/Y, N)
CPT FV = $226,107.75
The Loan outstanding is $226,107.75 after 5 years
Third Step
PV = -226107.75
I/Y = 5.1%/12
N = 12*25 = 300
FV = 0
Using the Financial calculator
CPT PMT = PMT(-PV, N, I/Y, FV)
CPT PMT = $1,335.01
Hence, the new monthly payment is $1,335.01
Jamie is single. In 2020, she reported $108,000 of taxable income, including a long-term capital gain of $5,800. What is her gross tax liability? (Round your answer to the nearest whole dollar amount.) (Use the tax rate schedules, long-term capital gains tax brackets.)
a. $19.478
b. $20143
c. $18,728
d. 516 200
Answer:
$19,478
Explanation:
Computation of tax liability
i. Total income excluding LTC gain = 108,000 - 5,800 = 102,200
ii. Tax on 102,200 as per single tax schedule = 14605.5+((102200-85525)*24%) = 18607.50
iii. Tax on LTC gain at 15% = 5800 * 15% = 870
So, Gross Tax liability = $18607.50 + $870 = $19477.50 = $19,478
Note: As per Long term capital gain schedule
A granary allocates the cost of unprocessed wheat to the production of feed, flour, and starch. For the current period, unprocessed wheat was purchased for $320,000, and the following quantities of product and sales revenues were produced. Product Pounds Price per pound Feed 100,000 $ 1.60 Flour 72,000 2.50 Starch 40,000 1.50 How much of the $320,000 cost should be allocated to flour if the value basis is used
Answer:
the cost that should be allocated to flour is $144,000
Explanation:
The computation is shown below:
Particulars Total value
Feed (100,000 × $1.60) = $160,000
Flour (72,000 × $2.50) = $180,000
Starch (40,000 × $1.50) = $60,000
Total $400,000
Now the allocation made to flour is
= $180,000 ÷ $400,000 × $320,000
= $144,000
Hence, the cost that should be allocated to flour is $144,000
Turnbull Co. has a target capital structure of 58% debt, 6% preferred stock, and 36% common equity. It has a before-tax cost of debt of 8.2%, and its cost of preferred stock is 9.3%. If Turnbull can raise all of its equity capital from retained earnings, its cost of common equity will be 12.4%. However, if it is necessary to raise new common equity, it will carry a cost of 14.2%. If its current tax rate is 25%, how much higher wi
Answer:
Turnbull’s weighted average cost of capital (WACC) will be higher by 0.64% if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings.
Explanation:
Note: This question is not complete. The complete question is therefore provided before answering the question as follows:
Turnbull Co. has a target capital structure of 58% debt, 6% preferred stock, and 36% common equity. It has a before-tax cost of debt of 8.2%, and its cost of preferred stock is 9.3%. If Turnbull can raise all of its equity capital from retained earnings, its cost of common equity will be 12.4%. However, if it is necessary to raise new common equity, it will carry a cost of 14.2%. If its current tax rate is 40%, how much higher will Turnbull’s weighted average cost of capital (WACC) be if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings? (Note: Round your intermediate calculations to two decimal places.)
The explanation to the answer is now given as follows:
Step 1: Calculation of WACC when all of its equity capital is raised from retained earnings
This can be calculated using WACC formula as follows:
WACCR = (WS * CE) + (WP * CP) + (WD * CD * (1 - T)) ………………… (1)
Where;
WACCR = Weighted average cost of capital when all of its equity capital is raised from retained earnings = ?
WS = Weight of common equity = 36%, or 0.36
WP = Weight of preferred stock = 6%, or 0.06
WD = Weight of debt = 58%, or 0.58
CE = Cost of equity = 12.4%, or 0.124
CP = Cost of preferred stock = 9.3%, 0.093
CD = Before-tax cost of debt = 8.2%, or 0.082
T = Tax rate = 40%, or 0.40
Substituting the values into equation (1), we have:
WACCR = (0.36 * 0.124) + (0.06 * 0.093) + (0.58 * 0.082 * (1 - 0.40))
WACCR = 0.078756, or 7.8756%
Rounding to 2 decimal places, we have:
WACCR = 7.88%
Step 2: Calculation of WACC if it raises new common equity
This can also be calculated using WACC formula as follows:
WACCE = (WS * CE) + (WP * CP) + (WD * CD * (1 - T)) ………………… (2)
Where;
WACCE = Weighted average cost of capital if it raises new common equity = ?
WS = Weight of common equity = 36%, or 0.36
WP = Weight of preferred stock = 6%, or 0.06
WD = Weight of debt = 58%, or 0.58
CE = Cost of equity = 14.2%, or 0.142 (Note: This is the only thing that has changed compared to what we have in Step 1 above.)
CP = Cost of preferred stock = 9.3%, 0.093
CD = Before-tax cost of debt = 8.2%, or 0.082
T = Tax rate = 40%, or 0.40
Substituting the values into equation (2), we have:
WACCE = (0.36 * 0.142) + (0.06 * 0.093) + (0.58 * 0.082 * (1 - 0.40))
WACCE = 0.085236, or 8.5236%
Rounding to 2 decimal places, we have:
WACCE = 8.52%
Step 3: Caculation of how much higher will Turnbull’s weighted average cost of capital (WACC) be if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings.
This can be calculated as follows:
Percentage by which WACC is higher = WACCE - WACCR
Percentage by which WACC is higher = 8.52% - 7.88%
Percentage by which WACC is higher = 0.64%
Therefore, Turnbull’s weighted average cost of capital (WACC) will be higher by 0.64% if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings.
Dan Pink argues that for 21st century tasks in creative businesses the mechanistic, reward-and-punishment approach will not work best because creativity is often constrained when immediate monetary rewards are offered in return for success. a. Trueb. False
Answer: True
Explanation:
This statement is true. Dan Pink argued that when it came to creative businesses, it would be best to use intrinsic as opposed to extrinsic rewards to encourage employees as extrinsic rewards such as money could constrain creativity.
Intrinsic rewards are those that are psychologically rewarding such as giving employees tasks that are fulfilling and make them feel part of the team as well as positive feedback from employers.
Two alternatives, code-named X and Y, are under consideration at Afalava Corporation. Costs associated with the alternatives are listed below. Alternative X Alternative Y Materials costs........ $37,000 $37,000 Processing costs...... $38,000 $53,000 Equipment rental.... $12,000 $26,000 Occupancy costs...... $16,000 $26,000 Are the materials costs and processing costs relevant in the choice between alternatives X and Y
Answer:
Only materials costs are relevant
Explanation:
Here in the given situation, the processing cost is only relevant and considered this represents that it helps to make the decisions.
While on the other hand, the material cost is not relevant but it would be continue for each alternative course of action
Therefore the first option is correct
The same is to be considered
Boots Plus has two product lines: Hiking boots and Fashion boots. Income statement data for the most recent year follow: Total Hiking Fashion Sales revenue $520,000 $380,000 $140,000 Variable expenses 365,000 245,000 120,000 Contribution margin 155,000 135,000 20,000 Fixed expenses 81,000 40,500 40,500Operating income (loss) $74,000 $94,500 $(20,500)Assuming the Fashion line is discontinued, total fixed costs remain unchanged, and the space formerly used to produce the line is rented for per year, how will operating income be affected?A. Increase $157,000.B. Decrease $49,500.C. Increase $6,000.D. Increase $83,000.
Question Completion:
Assuming that the rent received from the Fashion line space is $40,500.
Answer:
Boots Plus
The operating income will be increased by $20,500.
Explanation:
a) Data and Calculations:
Boots Plus Income Statement before the discontinuation of Fashion line:
Total Hiking Fashion
Sales revenue $520,000 $380,000 $140,000
Variable expenses 365,000 245,000 120,000
Contribution margin 155,000 135,000 20,000
Fixed expenses 81,000 40,500 40,500
Operating income (loss) $74,000 $94,500 $(20,500)
Elimination of the Fashion line
Boots Plus Income Statement after the discontinuation of Fashion line::
Total
Sales revenue $380,000
Variable expenses 245,000
Contribution margin 135,000
Fixed expenses 81,000
Rent income 40,500
Operating income (loss) $94,500
Concord Inc. took a physical inventory at the end of the year and determined that $783000 of goods were on hand. In addition, Concord, Inc. determined that $55000 of goods that were in transit that were shipped f.o.b. shipping point were actually received two days after the inventory count and that the company had $91000 of goods out on consignment. What amount should Concord report as inventory at the end of the year
Answer:
$929,000
Explanation:
Calculation for the amount that Concord should report as inventory at the end of the year
Using this formula
Inventory=Ending physical inventory+Goods in transit+Goods out on consignment
Let plug in the formula
Inventory=$783,000+$55,000+$91,000
Inventory=$929,000
Therefore the amount that Concord should report as inventory at the end of the year will be $929,000
The process of starting, organizing, managing, and assuming the responsibility for a business is called capitalism.
a. True
b. False
Answer: False
Explanation: There you go.
Smart Industries leases equipment on January 1, 2016. The finance lease has an 11-year term, and an implicit rate of 5%. The equipment has a list price of $300,000 and the lease agreement requires a $20,000 down payment when the lease is signed plus 10 annual payments of $36,261.28 on December 31 of each year of the lease. After Smart Industries makes its payment on December 31, 2018, what is its remaining lease obligation (carrying value) for the equipment
Answer:
$234,364.37
Explanation:
Lease obligation = Present value of remaining Lease payment
Present Value Of An Annuity = C*[1-(1+i)^-n]/i]
Present Value of Annuity = $36261.28 * [1-(1+0.05)^-8 /0.05]
Present Value of Annuity = $36261.28 * [1-(1.05)^-8 /0.05]
Present Value of Annuity = $36261.28 * [(0.3232)] /0.05
Present Value of Annuity = $234,364.37
Hence, its remaining lease obligation (carrying value) for the equipment is $234,364.37