Answer:
Swifty Corporation
Journal Entries:
April 1:
Debit Cash Account $49,800
Credit Common Stock $49,800
To record the issue of common stock for cash.
April 4:
Debit Land $30,500
Credit Cash Account $30,500
To record the purchase of land for cash.
April 8:
Debit Advertising Expense $1,510
Credit Accounts Payable $1,510
To record advertising expense incurred on account.
April 11:
Debit Salaries and Wages Expense $1,380
Credit Cash Account $1,380
To record the payment of salaries to employees.
April 13:
Debit Prepaid Insurance $1,620
Credit Cash Account $1,620
To record the prepayment of Insurance for one year.
April 17:
Debit Dividends $1,810
Credit Cash Account $1,810
To record the declaration any payment of dividend.
April 20:
Debit Cash Account $6,200
Credit Service Revenue $6,200
To record the receipt of admission fees in cash.
April 25:
Debit Cash Account $5,763
Credit Unearned Service Revenue $5,763
To record the receipt of admission fees in advance.
April 30:
Debit Cash Account $9,000
Credit Service Revenue $9,000
To record the receipt of admission fees in cash.
April 30:
Debit Accounts Payable $1,510
Credit Cash Account $1,510
To record the payment of advertising on account.
Explanation:
Swifty Corporation uses journals to initially record its business transactions as they occur on a daily basis. Journalizing transactions is an important step in the accounting process, as it identifies accounts involved and shows the accounts to be debited and the ones to be credited in the general ledger.
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows:
Home Work
Direct materials cost per unit $38 $72
Direct labor cost per unit 23 40
Sales price per unit 359 573
Expected production per month 620 units 490 units
Harbour has monthly overhead of $180,660, which is divided into the following cost pools:
Setup costs $80,840
Quality control 68,620
Maintenance 31,200
Total $180,660
The company has also compiled the following information about the chosen cost drivers:
Home Work Total
Number of setups 41 53 94
Number of inspections 320 410 730
Number of machine hours 1,200 1,400 2,600
Required:
a. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line.
b. Calculate the production cost per unit for each of Harbour's products under a traditional costing system.
c. Calculate Harbour's gross margin per unit for each product under the traditional costing system.
Answer:
Instructions are below.
Explanation:
a)
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 180,660/2,600
Predetermined manufacturing overhead rate= $69.49 per machine hour
Now, we can allocate overhead to each product line:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Home= 69.49*1,200= $83,388
Work= 69.49*1,400= $97,286
b) We need to determine the unitary cost for each product:
Home:
Unitary cost= 38 + 23 + (83,388/620)= $195.50
Work:
Unitary cost= 72 + 40 + (97,286/490)= $310.54
c) Gross margin= selling price - unitary cost
Home:
Gross margin= 359 - 195.5= $163.4
Work:
Gross margin= 573 - 310.54= $262.46
rion Iron Corp. tracks the number of units purchased and sold throughout each year but applies its inventory costing method at the end of the year, as if it uses a periodic inventory system. Assume its accounting records provided the following information at the end of the annual accounting period, December 31. Transactions Units Unit Cost a. Inventory, Beginning 300 $ 14 For the year: b. Purchase, April 11 950 12 c. Purchase, June 1 850 15 d. Sale, May 1 (sold for $42 per unit) 300 e. Sale, July 3 (sold for $42 per unit) 630 f. Operating expenses (excluding income tax expense), $18,200 Required: 1. Calculate the number and cost of goods available for sale. 2. Calculate the number of units in ending inventory. 3. Compute the cost of ending inventory and cost of goods sold under (a) FIFO, (b) LIFO, and (c) weighted average cost. 4. Prepare an income statement that shows under the FIFO method, LIFO method and weighted average method. 6. Which inventory costing method minimizes income taxes
Answer:
1. 2,100 units and $28,350
2. 1,170 units
3.
Cost of ending inventory Cost of goods sold
a. FIFO $16,590 $11,760
b. LIFO $15,300 $13,050
c. Weighted Average $12,093 $12,492
4.
Income Statement for the year ended December 31
FIFO LIFO Weighted Average
Sales ($12,600 + $ 26,460) $39,060 $39,060 $39,060
Cost of Goods Sold ($11,760) ($13,050) ( $12,492)
Gross Profit $27,300 $26,010 $26,568
Less Expenses ($18,200) ($18,200) ($18,200)
Net Income / (Loss) $9,100 $7,810 $8,368
5. No Data
6. LIFO
Explanation:
Periodic Method means that inventory valuation is done after a specific period. In this case valuation is being done at year end.
Calculation of the number and cost of goods available for sale
Units Total Costs
Beginning Inventory 300 $4,200
Add Purchases :
April 11 950 $11,400
June 1 850 $12,750
Available for Sale 2,100 $28,350
Ending Inventory units = Units Available for Sale - Units Sold
= 2,100 units - 300 units - 630 units
= 1,170 units
a. FIFO
FIFO stands for First In First Out.
i. Cost of ending inventory
320 units × $12 = $3,840
850 units × $15 = $12,750
Total = $16,590
ii. Cost of goods sold
300 units × $14 = $4,200
630 units × $12 = $7,560
Total = $11,760
b. LIFO
LIFO stands for Last In Last Out
i. Cost of ending inventory
300 units × $14 = $4,200
650 units × $12 = $7,800
220 units × $15 = $3,300
Total = $15,300
ii. Cost of goods sold
300 units × $12 = $3,600
630 units × $15 = $9,450
Total = $13,050
c. weighted average cost
This method recalculates the unit costs after every purchase. Sales are valued at the latest unit costs calculated.
1st calculation : April 11
Unit Cost = Total Cost ÷ Total Number of Units
= ((950 units × $12) + (300 units × $14)) ÷ (1,250)
= $12.45
Sale = 300 × $12.45
= $3,735
2nd Calculation : June 1
Unit Cost = Total Cost ÷ Total Number of Units
= ((650 units × $12.45) + (850 units × $15)) ÷ (1,500)
= $13.90
Sale = 630 × $13.90
= $8,757
ii. Cost of goods sold
Total Cost of Goods Sold = $3,735 + $8,757
= $12,492
i. Cost of ending inventory
Ending Inventory = 870 × $13.90
= $12,093
The founder of Alchemy Products Inc. discovered a way to turn gold into lead and patented this new technology. He then formed a corporation and invested $200,000 in setting up a production plant. He believes that he could sell his patent for $50 million. a. What is the book value of the firm? (Enter your answer in dollars.) b. What is the market value of the firm? (Enter your answer in dollars not in millions.) c. If there are 2 million shares of stock in the new corporation, what is the book value per share? (Round your answer to 2 decimal places.) d. What is the price per share? (Round your answer to 2 decimal places.)
Answer:
(A) $200,000
(B) $50,200,000
(C) $0.10 per share
(D) $25.10 per share
Explanation:
(A) The book value of the firm is $200,000
(B) The market value of the firm can be calculated as follows
= $200,000 + 50,000,000
= $50,200,000
(C) The book value per share can be calculated as follows
= 200,000/2,000,000
= $0.10 per share
(D) The price per share can be calculated as follows
= 50,200,000/2,000,000
= $25.10 per share
Assessing the quality of reported earnings using cash flow data. Prior to the dominance of Netflix, Blockbuster was the leading movie rental company in the U.S. In 1989, Lee J. Seidler, a senior analyst with Bear Stearns & Co., issued a research report critical of Blockbuster’s earnings. Mr. Seidler observed that although Blockbuster’s 1988 net income was $15.5 million and its cash flow from operating activities was $48.4 million, his review of the firm’s cash flow data revealed that Blockbuster’s purchases of new videocassette rental inventory had been classified as an "investing activity" rather than as "operating activity" on the company’s statement of cash flows. Presented below is selected financial statement for Blockbuster (in millions of dollars): Blockbuster Cash Flow 1988 1987 Net Income $15.5 $4.09 Cash Flow from Operations 48.3 10.3 Purchases of videocassettes rental inventory (51.3) (14.3) Do you agree with Blockbuster’s decision to classify its videocassette inventory purchases as an "investing activity"? Why or Why not? How does Blockbuster’s cash flow classification of its video inventory purchases affect its cash flow from operations? In general, discuss how the statement of cash flow data can be used to help evaluate a company’s reported earnings?
Answer:
Follows are the solution to this question:
Explanation:
In 1988 blockbusters generated by operational cash flow exceeding $3 for each and every dollar of sales, which is defined in the below table:
1988 1987
[tex]\left\begin{array}{ccc} \text{cash flow from opeations(a)}&\$ \ 48.30 & 10.30 \\\text{net income(b)} &\$ \ 15.50 &4.09 \\ratio( \frac{a}{b}) &\$ \ 3.12 &2.52\end{array}\right[/tex]
So, Mr. Seidler 's problem will be whether the cashflow for vidoe rentals will be reported throughout the operating activities or Whether investment.
For the cash flow of such a behavioral pattern blockbuster, its ratio indicates also that blockbuster lost $0.19 for its net revenues reported by looks of mr. seidler in 1988 to each dollar in cash, as blockbuster was its world's largest video shop chain, getting its key sales from of the movie streaming of its operations.
1988 1987
[tex]\left\begin{array}{ccc} \text{cash flow from opeations(as report)}&\$ \ 48.30 & 10.30 \\\text{less:videocasette purchases} &\$ \ 15.30 &4.09 \\Cash \ flow &\$ \ 3.00 &4.00\end{array}\right[/tex]
[tex]\left\begin{array}{ccc} \text{cash flow from opeations(a)}&\$ \ 3.00 & 4.00 \\\text{net income(b)} &\$ \ 15.50 &4.09 \\ratio( \frac{a}{b}) &\$ \ 0.19 &0.98\end{array}\right[/tex]
It rate means which, Business retains stores since video cassettes have relatively low economic lives as the operational cash flow is much more consistent with the expected existence-generating sales of the asset.
Managers and leaders perform many tasks as a result of their goals and objectives. Even though many tasks may be completed as a result of their responsibilities, each task may be categorized into one of four functions of management.
Management is a process. This process is what allows managers and leaders to achieve organizational and personal goals. Included within this process are four functions of management. These four functions include planning, organizing, leading, and controlling. Each of these functions is an important aspect of the management process and must be implemented to achieve organizational goals. Match these functions with the followings.
a. Paul
b. Santiago
c. Matthew
d. Chioe
e. Kelly
f. Tomasz
g. Ava
h. Michelle
Answer:
a). Paul - Planning
b). Santiago - Organizing
c). Mathew - Planning
d). Chioe - Organizing
e). Kelly Tomasz - Leading
f). Ava - Controlling
g). Michelle - Organizing
Explanation:
Planning is described as the process of setting up the goals for the organization and formulating a course of action to achieve the intended goals.
Organizing is followed by planning which aims to assign the resources in a specific manner to ensure the effective accomplishment of the goal.
Leading is the process of providing guidance or direction to the staff, employees, and workers and keeps them motivated to ensure the smooth functioning of the process and achievement of optimum output.
Controlling is the last step in which the performances are governed and assessed as per the standards to find any variation.
Bill and Laura are in the 39.6% tax bracket for ordinary income and the 20% bracket for capital gains (ignore the 3.8% additional tax on investment income for higher-income taxpayers.) They have owned several blocks of stock for many years. They are considering the sale of two blocks of stock. The sale of one block would produce a gain of $15,000. The sale of the other would produce a loss of $19,000. For purposes of this problem, ignore personal exemptions, itemized deductions and other phase-outs. They have no other gains or losses this year.
Required:
a. How much tax will they save if they sell the block of stock that produces a loss?
b. How much additional tax will they pay if they sell the block of stock that produces a gain?
c. What will be the impact on their taxes if they sell both blocks of stock?
Answer:
a) the maximum amount that Bill and Laura will be able to deduct during the current year is $3,000. Their remaining loss = $19,000 - $3,000 = $16,000. The remaining $16,000 loss must be carried forward and deducted in subsequent years, or year, depending on their future capital gains. Total tax saved during this year = $3,000 x 39.6% = $1,188.
b) additional tax liability = $15,000 x 20% = $3,000
c) if they sell both, then their long term capital gains = $15,000 - $19,000 = -$4,000. They can deduct $3,000 during the current year, and the remaining $1,000 loss can be deducted in subsequent years. Total tax saved during this year = $3,000 x 39.6% = $1,188.
Margie Johnson is a staff accountant at ToolEx Company, a manufacturer of tools and equipment. The company is under pressure from investors to increase earnings, and the president of the expects the Accounting Department to "make this happen". Margie's boss, who has been a mentor to her, is concerned that if earnings do not increase, he will be terminated. Shortly after the end of the fiscal year, the company performs a physical count of the inventory. When Margie compares the physical count to the balance in the inventory account, she finds a significant amount of inventory shrinkage. The amount is so large that it will result in a significant drop in earnings this period. Margie's boss asks her not to make the adjusting entry for shrinkage this period. He assures her that they will get "caught up" on shrinkage in the next period, after the pressure is off to reach this period's earnings goal. Margie's boss asks her to do this as a personal favor to him.
Required:
What should Margie do in this situation? Why?
Answer and Explanation:
1. Margie Johnson would be ethically wrong if she grants the boss's favour to not report inventory shrinkage. Also financial statements would not show a true and fair view if she decides to follow what her boss is asking. She should report true inventory value in financial statements.
2. Yes Ryan is being professional since he is out to improve company's sales and income even though he may be putting pressure on employees to work overtime
Whipple Corp. just issued 325,000 bonds with a coupon rate of 6.29 percent paid semiannually that mature in 30 years. The bonds have a YTM of 6.73 percent and have a par value of $2,000. How much money was raised from the sale of the bonds? (Round your intermediate calculations to two decimal places and final answer to the nearest whole dollar amount.)
Answer:
la bilirrubina me duve a 100
Flounder Corp. uses a periodic inventory system and reports the following for the month of June. Date Explanation Units Unit Cost Total Cost June 1 Inventory 100 $5 $ 500 12 Purchases 385 6 2,310 23 Purchases 200 7 1,400 30 Inventory 230 Calculate weighted-average unit cost. (Round answer to 3 decimal places, e.g. 5.125.) Weighted-average unit cost $enter a weighted-average unit cost in dollars eTextbook and Media Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round answers to 0 decimal places, e.g. 125.) FIFO LIFO Average-cost The cost of the ending inventory $enter a dollar amount $enter a dollar amount $enter a dollar amount The cost of goods sold $enter a dollar amount $enter a dollar amount $enter a dollar amount
Answer:
Flounder Corp.
Weighted Average FIFO LIFO
Ending Inventory $1,414 $1,580 $1,280
Cost of goods sold $2,796 $2,630 $2,930
Explanation:
a) Data and Calculations:
Date Explanation Units Unit Cost Total Cost
June 1 Inventory 100 $5 $ 500
June 12 Purchases 385 6 2,310
June 23 Purchases 200 7 1,400
Total units 685 $ 4,210
June 30 Inventory 230
June 30 Units Sold 455 (685 - 230)
Weighted Average Cost = Total costs/Total units bought
= $4,210/685 = $6.146
Weighted Average:
Ending Inventory = $1,414 ($6.146 * 230)
Cost of goods sold = $2,796 ($6.146 * 455)
FIFO:
Ending Inventory = (30 * $6) + (200 * $7) = $1,580
Cost of goods sold = (100 * $5) + (355 * $6) = $2,630
LIFO:
Ending Inventory = (100 * $5) + (130 * $6) = $1,280
Cost of goods sold = (200 * $7) + (255 * $6) = $2,930
The weighted average method is based on an average cost for estimating the cost of ending inventory and cost of goods sold. The FIFO method assumes that goods bought initially are the first to be sold while the LIFO method assumes that goods bought last are the first to be sold.
On January 1, year 2, Connor Corporation signed a $100,000 noninterest-bearing note due in three years at a discount rate of 10%. Connor elects to use the fair value option for reporting its financial liabilities. On December 31, year 2, Connor's credit rating and risk factors indicated that the rate of interest applicable to its borrowings was 9%. The present value factors at 10% and 9% are presented below. PV factor 10%, 3 periods .751 PV factor 10%, 2 periods .826 PV factor 10%, 1 period .909 PV factor 9%, 3 periods .772 PV factor 9%, 2 periods .842 PV factor 9%, 1 period .917 At what amount should Connor present the note on the December 31, year 2 balance sheet?
Answer:
$84,200
Explanation:
The computation of the amount that should be presented the note as on Dec 31 for year 2 is shown below:
= PV factor 9%, 2 periods × non-interest bearing note amount
= 0.842 × $100,000
= $84,200
Here we considered the 9% interest rate as it is the revalued with respect to the fair value and the same is to be considered
true or false If you don't think a situation is okay or acceptable, others probably don't feel the same way.
he operations manager for the Blue Moon Brewing Co. produces two beers: Lite (L) and Dark (D). Two of his resources are constrained: production time, which is limited to 8 hours (480 minutes) per day; and malt extract (one of his ingredients), of which he can get only 675 gallons each day. To produce a keg of Lite beer requires 2 minutes of time and 5 gallons of malt extract, while each keg of Dark beer needs 4 minutes of time and 3 gallons of malt extract. Profits for Lite beer are $3.00 per keg, and profits for Dark beer are $2.00 per keg. For the production combination of 135 Lite and 0 Dark, which resource is slack (not fully used)?
The slack resource is the Production Time of 210 minutes.
What is a slack resource?Slack resources are excess resources. They are recognized as spare organizational capabilities and assets ready for use in productive activities.
Slack resources represent underutilized and hidden spare capacities and energies that a company can employ whenever it chooses or possesses other required resources to combine with the slack resource.
Data and Calculations:Production time = 8 hours or 480 minutes per day
Malt extract = 675 gallons
Lite (L) Dark (D)
Production time 2 min 4 min
Malt extract 5 gallons 3 gallons
Profits per keg $3.00 $2.00
Required production 135 kegs
Total resources required:
Production time = 270 minutes (135 kegs x 2) slack = 210 min (480 - 270)
Malt extract = 675 gallons (135 x 5) Slack = 0 min (675 - 675)
Thus, the slack resource is the Production Time of 210 minutes.
Learn more about resources at https://brainly.com/question/3081250
Transaction Entries and Adjusting Entries Deluxe Building Services offers janitorial services on both a contract basis and an hourly basis. On January 1, Deluxe collected $42,000 in advance on a six-month contract for work to be performed evenly during the next six months. a. Provide the general journal entry on January 1 to record the receipt of $42,000 for contract work. b. Provide the adjusting entry to be made on January 31, for the contract work done during January. c. At January 31, a total of 40 hours of hourly rate janitor work was unbilled. The billing rate is $25 per hour. Provide the adjusting entry needed on January 31. (Note: The firm uses the account Fees Receivable to reflect amounts due but not yet billed.)
Answer:
Jan.1
Dr Cash $ 42,000
Cr Unearned Service Revenue $42,000
Jan.31
Dr Unearned Service Revenue $ 7,000
Cr Service Revenue $ 7,000
Jan.31
Dr Account Fees Receivable $1,000
Cr Service Revenue $1,000
Explanation:
Preparation of Journal Entries
Jan.1
Dr Cash $ 42,000
Cr Unearned Service Revenue $42,000
(To record 6 month contract)
Jan.31
Dr Unearned Service Revenue $ 7,000 (42,000*1/6)
Cr Service Revenue $ 7,000
(To record january service fees earned on contract)
Jan.31
Dr Account Fees Receivable $1,000 ($40hours*$25 per hour)
Cr Service Revenue $1,000
(To record unbilled service fees at January 31)
Vera Ernst is a licensed dentist. During the first month of the operation of her business, the following events and transactions occurred.
April 1 Invested $20,000 cash in her business.
1 Hired a secretary-receptionist at a salary of $700 per week payable monthly.
2 Paid office rent for the month $1,500.
3 Purchased dental supplies on account from Dazzle Company $4,000.
10 Performed dental services and billed insurance companies $5,100.
11 Received $1,000 cash advance from Leah Mataruka for an implant.
20 Received $2,100 cash for services performed from Michael Santos.
30 Paid secretary-receptionist for the month $2,800.
30 Paid $2,600 to Dazzle for accounts payable due.
Required:
Journalize the transactions.
Answer:
April 1 Invested $20,000 cash in her business.
Dr Cash 20,000
Cr Vera, Ernst, capital 20,000
1 Hired a secretary-receptionist at a salary of $700 per week payable monthly.
no journal entry required
2 Paid office rent for the month $1,500.
Dr Rent expense 1,500
Cr Cash 1,500
3 Purchased dental supplies on account from Dazzle Company $4,000.
Dr Supplies 4,000
Cr Accounts payable 4,000
10 Performed dental services and billed insurance companies $5,100.
Dr Accounts receivable 5,100
Cr Service revenue 5,100
11 Received $1,000 cash advance from Leah Mataruka for an implant.
Dr Cash 1,000
Cr Deferred revenue 1,000
20 Received $2,100 cash for services performed from Michael Santos.
Dr Cash 2,100
Cr Service revenue 2,100
30 Paid secretary-receptionist for the month $2,800.
Dr Wages expense 2,800
Cr Cash 2,800
30 Paid $2,600 to Dazzle for accounts payable due.
Dr Accounts payable 2,600
Cr Cash 2,600
how will food delivery like deliveroo engage with local community
Answer:
People can go around and help the economy continue flowing
Explanation:
The person ordering is supporting a restaurant in the community without having to leave the house if they don't want to but they are still able to get food from places and they are able to support them with their business. They are also paying the person who is delivering the food, helping give people in the community jobs and keep the economy flowing.
This activity is important because as world trade has grown, more companies have entered the global market. Once a firm decides to enter the global market, it must choose which means of market entry is the most appropriate. The global market entry strategies vary greatly on the dimensions of financial commitment, risk, marketing control, and profit potential. The goal of this exercise is to demonstrate your understanding of the different types of global market entry strategies: exporting, licensing, joint venture, and direct investment.
Match the correct global market entry strategy with the followings.
a. Indirect Exporting
b. Direct Exporting
c. Licensing
d. Franchising
e. Joint Venture
f. Direct Investment
1. Moodmatcher lipstick
2. Boeing
3. Yoplait
4. McDonald's
Answer:
Matching the correct global market entry strategy with:
1. Moodmatcher lipstick = b. Direct Exporting
2. Boeing = b. Direct Exporting
3. Yoplait = d. Franchising
4. McDonald's = d. Franchising
Explanation:
a) Global market entry strategies;
a. Indirect Exporting
b. Direct Exporting
c. Licensing
d. Franchising
e. Joint Venture
f. Direct Investment
Most of the globalized entities enter the global market space through direct exports to consumer countries. Some others engage in licensing and franchising, joint venture and indirect exports of their products and services to non-domestic countries. Huge revenues are earned through global trades. Some companies like MTN headquartered in South Africa earn more revenue in foreign markets than in their domestic markets.
I learned that before application of shampoo it is important to
Answer:
oil it I think!
Explanation:
massage hair oil into the scalp before shampooing it!
Reese, a calendar-year taxpayer, uses the cash method of accounting for her sole proprietorship. In late December, she received a $23,000 bill from her accountant for consulting services related to her small business. Reese can pay the $23,000 bill anytime before January 30 of next year without penalty. Assume Reese’s marginal tax rate is 32 percent this year and will be 37 percent next year, and that she can earn an after-tax rate of return of 7 percent on her investments.
a. What is the after-tax cost if she pays the $39,000 bill in December?
After-tax cost 26,520
b. What is the after-tax cost if she pays the $39,000 bill in January? (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.)
After-tax cost
c. Should Reese pay the $39,000 bill'in December or Jahuary?
December
January
d. What is the after-tax cost if she expects her marginal tax rate to be 24 percent next year and pays the $39,000 bill in January? Use Exhibit 31. (Round your answer to the nearest whole dollar amount.)
After-tax cost
e. Should Reese pay the $39,000 bill in December or January if she expects her marginal tax rate to be 32 percent this year and 24 percent next year?
December
January
Answer:
a. What is the after-tax cost if she pays the $39,000 bill in December?
= $23,000 x (1 - 32%) = $15,640
b. What is the after-tax cost if she pays the $39,000 bill in January? (Do not round intermediate calculations. Round your answer to the nearest whole dollar amount.)
total after tax cost (including investment revenue):
= $23,000 x (1 - 37%) = $14,490
= -$23,000 x 7% x 1/12 x (1 - 37%) = -$84.53
= $14,405.47
c. Should Reese pay the $23,000 bill'in December or January?
January , since the after tax cost is lower
d. What is the after-tax cost if she expects her marginal tax rate to be 24 percent next year and pays the $23,000 bill in January?
= $23,000 x (1 - 24%) = $17,480
= -$23,000 x 7% x 1/12 x (1 - 24%) = -$101.97
= $17,378.03
e. Should Reese pay the $23,000 bill in December or January if she expects her marginal tax rate to be 32 percent this year and 24 percent next year?
December, since the after tax cost is lower
What are some Drawbacks of business Debt?
Answer:Paying Back the Debt. Making payments to a bank or other lender can be stress-free if you have ample revenue flowing into your business. ...
High Interest Rates.
The Effect on Your Credit Rating.
Cash Flow Difficulties.
Explanation:
Tom Zopf owns and manages a computer repair service, which had the following trial balance on December 31, 2018 (the end of its fiscal year). Wildhorse Co. Trial balance December 31, 2018
Debit Credit
Cash $8,200
Accounts Receivable 14,800
Supplies 13,300
Prepaid Rent 1,600
Equipment 19,200
Accounts Payable $15,900
Common Stock 31,000
Retained Earnings 10,200
$57,100 $57,100
Summarized transactions for January 2019 were as follows.
1. Advertising costs, paid in cash, $1,160.
2. Additional supplies acquired on account $4,460.
3. Miscellaneous expenses, paid in cash, $2,180.
4. Cash collected from customers in payment of accounts receivable $12,130.
5. Cash paid to creditors for accounts payable due $12,570.
6. Repair services performed during January: for cash $6,860; on account $9,040.
7. Wages for January, paid in cash, $2,500.
8. Dividends during January were $2,520.
Required:
a. Post the journal entries to the accounts in the ledger.
b. Prepare a trial balance as of January 31, 2019.
Answer:
a)
1. Advertising costs, paid in cash, $1,160.
Dr Advertising expense 1,160
Cr Cash 1,160
2. Additional supplies acquired on account $4,460.
Dr Supplies 4,460
Cr Accounts payable 4,460
3. Miscellaneous expenses, paid in cash, $2,180.
Dr Miscellaneous expenses 2,180
Cr Cash 2,180
4. Cash collected from customers in payment of accounts receivable $12,130.
Dr Cash 12,130
Cr Accounts receivable 12,130
5. Cash paid to creditors for accounts payable due $12,570.
Dr Accounts payable 12,750
Cr Cash 12,750
6. Repair services performed during January: for cash $6,860; on account $9,040.
Dr Cash 6,860
Dr Accounts receivable 9,040
Cr Service revenue 15,900
7. Wages for January, paid in cash, $2,500.
Dr Wages expense 2,500
Cr Cash 2,500
8. Dividends during January were $2,520.
Dr Dividends 2,520
Cr Cash 2,520
b)
Debit Credit
Cash $6,080
Accounts Receivable $11,710
Supplies $17,760
Prepaid Rent $1,600
Equipment $19,200
Accounts Payable $7,610
Common Stock $31,000
Retained Earnings $10,200
Service revenue $15,900
Advertising expense $1,160
Miscellaneous expenses $2,180
Wages expense $2,500
Dividends $2,520
TOTALS $64,710 $64,710
Duerr Company makes a $79,000, 30-day, 12% cash loan to Ryan Co. The note and interest to be collected at maturity is:
Answer:
The maturity value is "$79790".
Explanation:
The given values are:
Principal
= $79,000
Time
= 30/360
Rate
= 12%
The interest on the cash loan to Ryan and Co will be:
= [tex]79000\times 12 \ percent\times \frac{30}{360}[/tex]
= [tex]790[/tex] ($)
Maturity value
= [tex]Principal\times (1+rate\times time)[/tex]
= [tex]79000\times (1+(12 \ percent\times \frac{30}{360} )[/tex]
= [tex]79000\times 1.0100[/tex]
= [tex]79790[/tex]
A private investment club has $300,000 earmarked for investment in stocks. To arrive at an acceptable overall level of risk, the stocks that management is considering have been classified into three categories: high-risk, medium-risk, and low-risk. Management estimates that high-risk stocks will have a return rate of 15%; medium-risk stocks, 10%; and low-risk stocks, 6%. The members have decided that the investment in low-risk stocks should be equal to the sum of the investments in the stocks of the other two categories. Determine how much the club should invest in each type of stock if the investment goal is to have a return of $30,000 on the total investment. (Assume that all the money available for investment is invested. Let x, y, and z denote the amount, in dollars, invested in high-, medium-, and low-risk stocks, respectively.)
Answer:
Investment in low risk=$150,000
Investment in medium risk =$30,000
Investment in high risk=$120,000
Explanation:
✓We can denote the investment in high risk as $x
✓ We can denote the investment medium risk as $y
✓We can denote the investment in low risk as($x + $y)
The summation of the investment = x + y +( x + y )= $300,000
If we add the like-terms together we have,
2x + 2y = $300,000
If we divide the both sides by 2, we have
x+y = 150,000
If we make "x" as subject of the formula, we have
x =150,000 -y •••••••••••eqn(**)
Total return on investments is
0.15x +0.10y +0 .06(x+y) = $30,000••••••••••••••••••••••••••••eqn(#)
Substitute for x from eqn(**) into equation (#)
0.15(150,000 -y) + 0.10y + 0.06(150,000-y +y) = 30,000
22500-0.15y+0.10y+9000= 30,000
0.05y=1500
y=1500/0.05
y=30,000
Recall, x =150,000 -y
Then
x = 150,000 - 30,000 = 120,000
y=30,000
x=120,000
Investment in low risk = x + y
= 30,000+120,000= 150,000
Hence, the investment in high risk
is $120,000, the investment medium risk is $30,000 and the investment in low risk is $ 150,000.
On December 31, 2021, the end of the fiscal year, Revolutionary Industries completed the sale of its robotics business for $13.0 million. The robotics business segment qualifies as a component of the entity according to GAAP. The book value of the assets of the segment was $9.0 million. The income from operations of the segment during 2021 was $6.0 million. Pretax income from continuing operations for the year totaled $14.0 million. The income tax rate is 25%.
Required:
Prepare the lower portion of the 2021 income statement beginning with income from continuing operations before income taxes. Ignore EPS disclosures.
Answer:
Revolutionary Industries
Income Statement
For the year ended December 31, 2021
...
Pre-tax Income from continuing operations $14,000,000
Income taxes ($3,500,000)
Income from continuing operations $10,500,000
Discontinued operations:
Gain from sale of disc. component $4,000,000Income from disc. component $6,000,000Income taxes ($2,500,000) $7,500,000Net income $18,000,000
Required information The Ferre Publishing Company has three service departments and two operating departments. Selected data from a recent period on the five departments follow: Service Departments Operating Departments Administration Janitorial Maintenance Binding Printing Total Costs $168,000 $126,000 $57,600 $330,000 $516,000 $1,197,600 Number of employees 60 35 140 315 210 760 Square feet of space occupied 15,000 10,000 20,000 40,000 100,000 185,000 Hours of press time 30,000 60,000 90,000 Administration is allocated based on number of employees; Janitorial based on space occupied; and Maintenance based on hours of press time. Required: Assuming that the company uses the direct method to allocate service department costs, how much cost would be assigned to each operating department
Answer:
The Ferre Publishing Company
Allocation of Cost to Each Department under the Direct Method;
Service Departments Operating Departments
Admini Janitorial Mainten Binding Printing Total
-stration -ance
Costs $168,000 $126,000 $57,600 $330,000 $516,000 $1,197,600
Admin. (168,000) 100,800 67,200 0
Janitorial (126,000) 36,000 90,000 0
Maintenance (57,600) 19,200 38,400 0
Total assigned cost $486,000 $711,600 $1,197,600
Explanation:
a) Data and Calculations:
Service Departments Operating Departments
Admini Janitorial Mainten Binding Printing Total
-stration -ance
Costs $168,000 $126,000 $57,600 $330,000 $516,000 $1,197,600 Number of
employees 60 35 140 315 210 760
Square feet of space
occupied 15,000 10,000 20,000 40,000 100,000 185,000 Hours of press time 30,000 60,000 90,000
Allocation basis Allocation Basis Allocation Rate Calculation
Administration Number of employees $320/employee ($168,000/525)
Janitorial Space occupied $0.90/space ($126,000/140,000)
Maintenance Hours of press time $0.64/press time ($57,600/90,000)
The direct method is one of the methods that The Ferre Publishing Company can use to allocate the overhead costs of the three service departments: Administration, Janitorial, and Maintenance to the Operating Departments: Binding and Printing. Others are the Step method and the Reciprocal method. The Step method allocates one service costs to some other service departments one by one. The Reciprocal relies on an elimination formula.
Assume that Jackson is a price-taker and the current wholesale market price is $7.30 per can of paint. What is the target total of cost in producing and selling 6 million cans of paint? Given Jackson's current total costs, will the company reach stockholders' profit goals? Begin by calculating Jackson's target total cost. Select the formula labels and enter the amounts. (Enter currency amounts in dollars, not in millions. Round all currency amounts to the nearest whole dollar.) Revenue at market price $43,800,000 Less: Desired profit 6000000 Target total cost 31,800,000
Answer:
Jackson's target total cost of producing and selling 6 million cans of paint of $31,800,000 will enable it to reach stockholders' profit goals of $6 million.
The implication is that it should not allow its total costs (Production and other business expenses) to exceed $37,800,000.
This is because its sales revenue will be equal to $43,800,000 (6,000,000 * $7.30).
As such, Jackson can produce a can of paint for $5.30. It can also incur an average business expense of $1.00 per can to maintain and reach its $6 million profit target.
Explanation:
Profit is the difference obtained after deducting all costs from the revenue. There are some profit stages. The first is the gross profit, which considers the sales revenue and the cost of goods sold. The next profit stage is the operating profit, which subtracts the business running expenses from the gross profit. There are also profits before and after interest and taxes. The after tax profit is also called the net income or net profit. If it is negative, then it is called the net loss. It is from the net income that distributions are made to stockholders in the form of dividends while a part is retained in the business to increase its capital stock or stockholders' equity.
Luke sold a building and the land on which the building sits to his wholly owned corporation, Studemont Corp. at fair market value. The fair market value of the building was determined to be $502,500; Luke built the building several years ago at a cost of $375,000. Luke had claimed $56,500 of depreciation expense on the building. The fair market value of the land was determined to be $254,000 at the time of the sale; Luke purchased the land many years ago for $147,750.a. What is the amount and character of Luke’s recognized gain or loss on the building?b. What is the amount and character of Luke’s recognized gain or loss on the land?---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------Aruna, a sole proprietor, wants to sell two assets that she no longer needs for her business. Both assets qualify as §1231 assets. The first is machinery and will generate a $16,250 §1231 loss on the sale. The second is land that will generate a $7,300 §1231 gain on the sale. Aruna’s ordinary marginal tax rate is 30 percent. (Input all amounts as positive values.)a. Assuming she sells both assets in December of year 1 (the current year), what effect will the sales have on Aruna’s tax liability?b. Assuming that Aruna sells the land in December of year 1 and the machinery in January of year 2, what effect will the sales have on Aruna’s tax liability for each year?
Answer and Explanation:
Answer and explanation attached
Use the following data to calculate the current ratio.
Kingbird, Inc. Balance Sheet December 31, 2022
Cash and cash equivalents $68000 Accounts payable $135500
Accounts receivable 103500 Salaries and wages payable 12300
Inventory 144500 Bonds payable 166000
Prepaid insurance 90000 Total liabilities $313800
Stock investments 181500
Land 195000
Buildings $225000 Common stock $239200
Less: Accumulated depreciation (64000) 161000 Retained earnings 502500
Trademarks 112000 Total stockholders' equity $741700
Total assets $1055500 Total liabilities and stockholders' equity $1055500
Answer:
Kingbird, Inc.
Current Ratio = Current Assets/Current Liabilities
= $406,000/$147,800
= 2.75
Explanation:
a) Data and Calculations:
Kingbird, Inc. Balance Sheet December 31, 2022
Cash and cash equivalents $68000 Accounts payable $135500
Accounts receivable 103500 Salaries & wages payable 12300
Inventory 144500 Bonds payable 166000
Prepaid insurance 90000 Total liabilities $313800
Stock investments 181500
Land 195000
Buildings $225000 Common stock $239200
Less: Accumulated
depreciation (64000) 161000 Retained earnings 502500
Trademarks 112000 Total stockholders' equity $741700
Total assets $1055500 Total liabilities and stockholders'
equity $1055500
Current Assets:
Cash and cash equivalents $68,000
Accounts receivable 103,500
Inventory 144,500
Prepaid insurance 90,000
Total current assets $406,000
Current Liabilities:
Accounts payable $135,500
Salaries & wages payable 12,300
Total current liabilities $147,800
Question 9
5 p
(02.02 LC)
Which of the following is a characteristic of a checking account?
Easy access to funds through a debit card
Fee charged if money is removed early
High rate of return on deposits
Minimum money amount requirement to invest
Answer:
Easy access to funds through a debit card
Explanation:
A checking account is an account that individuals open at a bank or a financial institution to withdraw and deposit money. It is also referred to as a demand account. The salient feature with a checking account is that it is very liquid. It permits users a quick way of accessing their money.
A checking account can be accessed using ATMs, electronic cards, and checks. The checking account allows users to deposit and withdraw money multiple times without attracting charges.
Where does the money you pay for the FICA tax on your paycheck go?
Answer:
see below
Explanation:
Social security and medicare taxes form the Federal Insurance Contributions Act (FICA) tax. These taxes are deducted from both the employer and employee per paycheck.
Social security tax forms the bulk of the FICA tax. The tax revenue collected as social security tax funds the United States government Social Security Trusts. The trusts are programs managed by the Social Security administration and include
Retirement benefitsSurvivor benefitsDisability benefitsMedicare tax revenue funds Federal government medicare programs. This program caters to older American health care costs. The government's general revenue also finances health care. Medicare or health services in the USA are not solely dependent on medicare tax.
Question 5 of 10
Which problem is more likely to affect a partnership than a sole
proprietorship?
A. The company will have a difficult time raising funds to get started.
B. The company falls apart if one owner dies or chooses to leave.
оооо
C. One person has total liability if the company loses money.
D. Owners have disagreements over how to run the business.
Answer:
D
Explanation:
owners have disagreement over how to run the business
A legal entity between at least two individuals who invest money and run a business is referred to as a partnership. A partnership is distinct from the partners as people, as contrast to a sole proprietorship.
There is a flow-through arrangement for general partnerships, which directs profits and losses to each partner's personal tax return.
what are disadvantages of partnership?A partnership's drawbacks include the fact that each owner or member is subject to unlimited liability for their actions within the company, transferability can be challenging to achieve.a partnership is unstable as it can dissolve when just one partner no longer wants to be involved in the company or is unable to do so.One of the main causes of business dissolution is conflict between partners who share the business equally.It will be expensive to lose a business partner since you will have to assess their assets and find someone else to take over for them as they have assumed a lot of responsibilities.learn more about problem more likely to effect a partnership here https://brainly.com/question/17440771
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