Answer:
what is the question lol? I could probably help you out !
Henry, Luther, and Gage are dissolving their partnership. Their partnership agreement allocates each partner 1/3 of all income and losses. The current period's ending capital account balances are Henry, $45,000; Luther, $37,000; and Gage, $(5,000). After all assets are sold and liabilities are paid, there is $77,000 in cash to be distributed. Gage is unable to pay the deficiency. What amount of cash will Gage receive upon liquidation
Answer: b. Debit Henry, Capital $42,500; debit Luther, Capital $34,500; credit Cash $77,000. Debit Henry, Capital $45,000; debit Luther, Capital $37,000; credit Gage, Capital $5,000; credit Cash $77,000.
Explanation:
The deficiency will apportioned to Henry and Luther equally.
Henry capital becomes = 45,000 - 2,500 = $42,500
Luther capital becomes = 37,000 - 2,500 = $34,500
The $77,000 will then be debited to their capital accounts to recognize the balance left in their accounts:
= 42,500 + 34,500
= $77,000
Credit Gage for $5,000 to recognize that Henry and Luther paid off the deficiency.
16. The selling of goods and/or services to a customer is called
O A. purchasing
B. food service.
O C. service industry.
D. retail
Answer: retail
Explanation:
Retail refers to the sale of products and/or services to a customer. Thus option (D) is correct.
What are customer?A client is a person who purchases goods, services, or ideas from a seller, vendor, or supplier in exchange for money or another useful consideration. This definition applies to sales, commerce, and economics. A customer is an individual or business that purchases another company's goods or services
An individual or business that purchases goods or services from another company is known as a customer. Customers are crucial to businesses because they generate income; without them, they would cease to exist.
Therefore, option(D) is correct.
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The selling price per unit is $3,500. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 1,400 units. There are no price, efficiency, or spending variances. Any pro- duction-volume variance is written off to cost of goods sold in the month in which it occurs. 360 CHAPTER 9 INVENTORY COSTING AND CAPACITY ANALYSIS 1. Prepare income statements for Crystal Clear in January, February, and March 2014 under (a) variable costing and (b) absorption costing. 2. Explain the difference in operating income for January, February, and March under variable costing and absorption costing.
Question Completion:
Crystal Clear Corporation manufactures and sells 50-inch television sets and uses standard costing. Actual data relating to January, February, and March 2014 are as follows:
Unit data January February March
Beginning inventory 0 100 100
Production 1,400 1,375 1,430
Sales 1,300 1,375 1,455
Variable Costs
Manufacturing cost
per unit produced 950 950 950
Operating (marketing)
cost per unit sold 725 725 725
Fixed Costs
Manufacturing costs 490,000 490,000 490,000
Operating (marketing) costs 120,00 120,000 120,000
Answer:
Crystal Clear
1. Income Statements in January, February, and March 2014:
a. Variable Costing Income Statement
January February March
Sales Revenue $4,550,000 $4,812,500 $5,092,500
Variable cost of goods 2,177,500 2,303,125 2,437,125
Contribution margin $2,372,500 $2,509,375 $2,655,375
Fixed Costs
Manufacturing costs 490,000 490,000 490,000
Operating (marketing) 120,000 120,000 120,000
Total fixed costs $610,000 $610,000 $610,000
Net operating income $2,371,800 $1,899,375 $2,045,375
b. Absorption Costing Income Statement
January February March
Sales Revenue $4,550,000 $4,812,500 $5,092,500
Cost of goods sold 1,690,000 1,795,750 1,881,315
Gross profit $2,860,000 $3,016,750 $3,211,185
Total operating costs 1,062,500 1,116,875 1,174,875
Net operating income $1,797,500 $1,899,875 $2,036,310
2. The difference in the operating incomes for January, February, and March under variable costing and absorption costing is due to the way the fixed cost per month is accounted for in cost of goods sold and ending inventory. With variable costing, all variable costs are included, while absorption includes both variable and fixed manufacturing costs. This makes the ending inventory of variable costing to be carried forward to the next period while absorption costing includes every fixed cost as period costs.
Explanation:
a) Data and Calculations:
Unit data January February March
Beginning inventory 0 100 100
Production 1,400 1,375 1,430
Sales 1,300 1,375 1,455
Ending inventory 100 100 75
Variable Costs
Manufacturing cost
per unit produced 950 950 950
Operating (marketing)
cost per unit sold 725 725 725
Fixed Costs
Manufacturing costs 490,000 490,000 490,000
Operating (marketing) costs 120,00 120,000 120,000
Cost of production:
Variable Costs
Manufacturing cost
per unit produced $1,330,000 $1,306,250 $1,358,500
(1,400 * $950) (1,375 * $950) (1,430 * $950)
Fixed Costs
Manufacturing costs 490,000 490,000 490,000
Total production costs $1,820,000 $1,796,250 $1,848,500
Production units 1,400 1,375 1,430
Unit cost of production $1,300 $1,306 $1,293
Sales Units 1,300 1,375 1,455
Cost of goods sold $1,690,000 $1,795,750 $1,881,315
Operating (marketing) (1,300*$725) (1,375*$725) (1,455*$725)
cost per unit sold
Variable operating cost $942,500 $996,875 $1,054,875
Fixed Costs
Operating (marketing) costs 120,000 120,000 120,000
Total operating costs $1,062,500 $1,116,875 $1,174,875
Variable Costs
Manufacturing cost
per unit produced 950 950 950
Operating (marketing)
cost per unit sold 725 725 725
Total per unit variable cost $1,675 $1,675 $1,675
Sales Units 1,300 1,375 1,455
Total variable cost of goods
sold = $2,177,500 $2,303,125 $2,437,125
A new minor league baseball stadium is opening soon and the owner is only allowing local, family-owned restaurants to sell within the park. Two hotdog vendors are set to sell within the stadium: (i) The HOT Dog and (ii) Ballpark Frankies. The Baseball park necessitates that the vendors set their prices at the beginning of each season and then hold the price constant during the games that occur that season. The fans are not sensitive to the quality of the hotdog, just the price. The two vendors have every inclination to stay in the ballpark for the life of their firms, so imagine that this will be an infinitely repeated game. Based on relative prices, the potential payoffs for the season are listed below: The HOT Dog Ballpark Frankies Low Price High Price Low Price $10,000 , $10,000 $90,000 , -$3,000 High Price -$3,000 , $90,000 $20,000 , $20,000 Given the high current interest rate of 10%, The HOT Dog is considering to post a high price in the inaugural season and hope that Ballpark Frankies follows as well with a high price of their own. Evaluate if this is a risky strategy for The HOT Dog.
Answer:
This is a very risky strategy for The HOT Dog.
Explanation:
Seeing as how they must keep the price continuously throughout the season, if Frankies' sets a low price, The HOT Dog will lose almost all of their business.
Efficient private provision of pure public goods is difficult because too much will be demanded as each consumer is forced to buy his or her own units of the public good too little will be demanded because private provision leads to higher marginal costs than public provision. too much will be produced as fi rms compete with each other for the public’s dollars. too little will be demanded as, individually, consumers choose not to pay the full cost of units of the good.
Answer:
too little will be demanded as, individually, consumers choose not to pay the full cost of units of the good.
Explanation:
Factors of production can be defined as the fundamental building blocks used by individuals or business firms for the manufacturing of finished goods and services in order to meet the unending needs and requirements of their customers.
The four factors of production are;
I. Land: this refers to the natural resources and raw materials extracted from the ground or grown in the soil e.g oil, gold, rubber, cocoa, etc.
II. Labor (working): this is the human capital or workers who are saddled with the responsibility of overseeing and managing all the aspects of production.
III. Capital resources: it includes the physical assets used for production of goods and services such as equipment, money, plant, etc.
IV. Entrepreneurship: it is intellectual capacity required to drive a business and the skills to develop an idea into a money making venture (business).
These four (4) factors of production when combined effectively and efficiently are used for the manufacturing or production of goods and services that meets the unending requirements or needs of the consumers.
Circular flow model is an economic model that is used by economists to show or demonstrate how money, goods and services move from one economic agent to another such as producer, workers, wholesaler, retailer and consumers (households).
An efficient private provision of pure public goods is difficult because too little will be demanded as, individually, consumers choose not to pay the full cost of units of the good.
In one sentence, briefly explain why a secretary must finalise his or her minutes in the shortest possible time after a meeting has ended
Answer:
Every set of minutes should include basic information about the meeting, starting with the meeting type -- committee or general -- and the time and date at which it started. The secretary should also record the names of all parties present as well if any members were excused from the meeting before it opened. If members arrive late to the meeting, note the time at which they arrived. In addition, if a proxy represents a member or a quorum of members, such as the case of a shareholder's meeting, the minutes should reflect his presence. The secretary should also record the time at which the meeting adjourns
Explanation:
Couldn't have been in one sentence but i hope i helped! xoxo
Your boss has asked you to obtain marketing feedback on one of the products for your company produces. But people are less likely to respond honestly if they know it’s the company requesting the information. So your boss tells you to use a fake marketing research name. Would you follow your boss’s direction? Why or why not?
Answer:
no I won't follow my boss
because I don't use Fake information
Alamo Power historically allocates IDC for its safety program to generation facilities in Cities A and B based on the number of employees. Last year, $300,000 was distributed and the employee count was 840 in city A and 450 in city B. Implementation of the ABC method took place this year to allocate IDC on the basis of number of accidents. City A reported 345 events and city B had 142 accidents reported.
Determine the allocation based on the number of employees. The allocation based on the number of employees is as follows:
City A:________
City B: _______
Answer:
Alamo Power
Allocation of IDC cost based on the number of employees:
City A = $195,349
City B = $104,651
Explanation:
a) Data and Calculations:
IDC cost = $300,000
City A City B Total
Employee count 840 450 1,290
Number of accidents 345 142 487
Allocation of IDC cost based on the number of employees:
City A = 840/1,290 * $300,000 = $195,349
City B = 450/1,290 * $300,000 = $104,651
Total cost allocated = $300,000
Allocation of IDC cost based on the number of accidents:
City A = 345/487 * $300,000 = $212,526
City B = 142/487 * $300,000 = $87,474
Haver Company currently produces component RX5 for its sole product. The current cost per unit to manufacture the required 69,000 units of RX5 follows. Direct materials $ 5.00 Direct labor 9.00 Overhead 10.00 Total costs per unit $ 24.00 Direct materials and direct labor are 100% variable. Overhead is 80% fixed. An outside supplier has offered to supply the 69,000 units of RX5 for $19.00 per unit. Required: 1. Determine the total incremental cost of making 69,000 units of RX5. 2. Determine the total incremental cost of buying 69,000 units of RX5. 3. Should the company make or buy RX5
Answer:
It is cheaper to make the units in-house. The company will save $207,000.
Explanation:
Giving the following formula:
Production:
Direct materials $ 5.00
Direct labor 9.00
Varaible overhead= 10 - 8= $2
Total fixed overhead= (10*0.8)*69,000= $621,000
Direct materials and direct labor are 100% variable.
Overhead is 80% fixed.
An outside supplier has offered to supply the 69,000 units of RX5 for $19.00 per unit.
I will assume that none of the fixed overhead is avoidable.
First, we need to calculate the incremental cost of making 69,000 units. As it is incremental, we will take into account only the variable costs:
Make in-house:
Total variable cost= 69,000*(5 + 9 + 2)= $1,104,000
Now, the total cost of buying:
Buy:
Total cost= 69,000*19= $1,311,000
It is cheaper to make the units in-house. The company will save $207,000.
Which one of the following statements is TRUE? a. If a company has a classified board, fewer board seats are filled each year. b. A classified board is one in which an announcement requesting applications for board members appears in the newspaper. c. One tool of corporate governance is choosing a good investment banker. d. A classified board is one in which the board members serve anonymously. e. In a classified board, it is easier for dissidents to gain representation since fewer seats are up for election each year.
Answer:
The true statement about a classified board is:
a. If a company has a classified board, fewer board seats are filled each year.
Explanation:
If Company A has a classified board of directors, it implies that it has a structure that enthrones continuity and stability, enables some portion of the directors to be elected each year, and ensures that different directors have different terms to serve the company. Depending on their classifications, some directors serve one or two years, some three or four years, some five or six years, and others servicing seven or eight years. This type of structured board staggers the board membership, helping to save the company from unintended takeover bids, and ensuring stability and continuity.
Soprano Corporation allocates administrative costs on the basis of staff hours. Short-run monthly usage and anticipated long-run monthly usage of staff hours for Operating Departments 1 and 2 follow. Department 1 Department 2 Total Short-run usage (hours) 80,000 120,000 200,000 Long-run usage (hours) 90,000 110,000 200,000 If Soprano uses dual-cost accounting procedures and fixed administrative costs total $1,000,000, the amount of fixed administrative costs to allocate to Department 1 would be:
Answer:
$850,000
Explanation:
Total Hours of Department 1=$80,000+$90,000
=$170,000/$200,000*1000,0000
As the price level rises, the purchasing power of households' real wealth will , causing the quantity of output demanded to . This phenomenon is known as the effect. Additionally, as the price level rises, the impact on the domestic interest rate will cause the real value of the dollar to in foreign exchange markets. The number of domestic products purchased by foreigners (exports) will therefore , and the number of foreign products purchased by domestic consumers and firms (imports) will . Net exports will therefore , causing the quantity of domestic output demanded to . This phenomenon is known as the effect.
Answer:
As the price level rises, the purchasing power of households' real wealth will fall, causing the quantity of output demand to fall. This phenomenon is known as the wealth effect.
Additionally, as the price level rises, the impact on the domestic interest rate will cause the real value of the dollar to rise in foreign exchange markets. The number of domestic products purchased by foreign (exports) will therefore fall, and the number of foreign products purchases by domestic consumers and firms(imports) will rise.
Net exports will therefore fall, causing the quantity of domestic output demanded to fall. This phenomenon is known as the exchange rate effect.
A lot of fluctuations is often seen in prices of goods. As the price level falls, the purchasing power of households' real wealth will rise, causing the quantity of output demanded to rise. This phenomenon is known as the wealth effect.
Additionally, as the price level falls, the impact on the domestic interest rate will cause the real value of the dollar to fall, in foreign exchange markets.
The number of domestic products purchased by foreigners (exports) will therefore rise, and the number of foreign products purchased by domestic consumers and firms (imports) will fall.
Net exports will therefore rise, causing the quantity of domestic output demanded to rise. This phenomenon is known as the exchange effect.
The wealth effect is simply known as the idea that when households become richer as a result of a rise in asset values, example corporate stock prices, they tend to spend more and boast a broader economy.
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Which of the following statements regarding SPT and WSPT is INCORRECT?
a. SPT always assigns the highest priority to the job to lowest processing time.
b. SPT does not consider the weight differences among different jobs.
c. WSPT may not assign the highest priority to the job with the highest weight because it also considers the processing time information.
d. WSPT assigns the highest priority to the job with the LOWEST weight/processing time ratio.
Answer:
D
Explanation:
WSPT assigns the highest priority to the job with the LOWEST weight/processing time ratio.
The Distance Plus partnership has the following capital balances at the beginning of the current year: Tiger (50% of profits and losses)$70,000Phil (40%) 40,000Ernie (10%) 55,000 Each of the following questions should be viewed independently. If Sergio invests $60,000 in cash in the business for a 25 percent interest, what journal entry is recorded
Answer:
Cash A/c (Dr) $60,000
Sergio Capital A/c (Cr) $41,250
Tiger Capital A/c (Cr) $9,375
Phil Capital A/c (Cr) $7,500
Ernie Capital A/c (Cr) $1,875
(To record admission of new partner)
Explanation:
The total investment by Sergio is $60,000 in cash will be debited in the journal entry recorded. His interest in the business is 25% which would be credited. So, first we calculate the total investment already made by the partners which is $165,000 (70,000 + 40,000 + 55,000).
Now, Sergio's investment is 25% of the total share of investment made by the partners which accounts to $41,250 (165,000 * 25%). This amount will be credited as Sergio Capital A/c.
The difference $18,750 (60,000 - 41,250) will credited in the capital A/c of other partners which would be divided proportionately to their business share. As done below:
Tiger Capital A/c - $9,375 (18,750 * 50%)
Phil Capital A/c - $7,500 (18,750 * 40%)
Ernie Capital A/c - $1,875 (18,750 * 10%)
Determine which one of these three portfolios dominates another. Name the dominated portfolio and the portfolio that dominates it. Portfolio Blue has an expected return of 13 percent and risk of 17 percent. The expected return and risk of portfolio Yellow are 19 percent and 15 percent, and for the Purple portfolio are 18 percent and 22 percent. multiple choicePortfolio Purple dominates portfolios Blue and Yellow.Portfolio Blue dominates portfolios Yellow and Purple.Portfolio Yellow dominates portfolios Blue and Purple.
Answer: Yellow dominates portfolios Blue and Purple.
Explanation:
Portfolio Yellow has a higher expected return than either portfolio Blue or Portfolio Purple which means that if we were evaluating the portfolios on return alone, Portfolio Yellow would dominate the other two.
However, we need to adjust for risk. The portfolio with the lowest standard deviation is the less riskier one of the three. That portfolio is Yellow which means that Yellow has both a higher expected return and a lower risk. It would therefore dominate the rest.
what is a marketing plan ?? answer please .
Answer:
marketing plan is defined as a comprehensive document or blueprint that outlines the advertising and marketing efforts for the coming year. It describes business activities involved in accomplishing specific marketing objectives within a set time frame. A marketing plan also includes a description of the current marketing position of a business, a discussion of the target market and a description of the marketing mix that a business will use to achieve their marketing goals.
During its first year of operations, Silverman Company paid $15,085 for direct materials and $10,200 for production workers' wages. Lease payments and utilities on the production facilities amounted to $9,200 while general, selling, and administrative expenses totaled $4,700. The company produced 6,050 units and sold 3,700 units at a price of $8.20 a unit. What is the amount of finished goods inventory on the balance sheet at year-end
Answer:
$13,395
Explanation:
Finished Goods Inventory = Production Cost x Ending Units / Units Produced
where,
Production Cost is Calculated as :
Consider only production costs.
Production Cost = $15,085 + $10,200 + $9,200 = $34,485
Ending Units = 6,050 units - 3,700 units = 2,350 units
Units Produced = 6,050 units
therefore,
Finished Goods Inventory = $34,485 x 2,350 units/ 6,050 units = $13,395
Ann Company borrowed $240,000 to buy an equipment on January 1, 2019, and signed a 7% instalment note requiring annual equal payments, including principal and interest at the end of every year for 15 years. Rounded to the nearest dollar, determine the balance in the Instalment Note Payable account after making the first annual payment.
Answer:
$2,000
Explanation:
Payment include repayment of Capital Amount and Payment of Interest expense
Therefore the balance in the Instalment Note Payable account after making the first annual payment is
Chevron Phillips (CP) has put into place new laboratory equipment for the production of chemicals; the cost is $1,770,000 installed. CP borrows 48% of all capital needed, and the borrowing rate is 13.4%. In the 1st year, 25% of the principal borrowed will be paid back. The throughput rate for in-process test samples has increased the capacity of the lab, saving a net of $X per year. In this 1st year, depreciation is $362,000 and taxable income is $329,000.
Required:
a. What is the gross income or annual savings?
b. Determine the income tax for the 1st year assuming a marginal tax rate of 40%.
c. What is the after-tax cash flow for the 1st year?
Answer:
Chevron Phillips (CP)
a. The gross income or annual savings is:
= $804,846.
b. The income tax for the 1st year assuming a marginal tax rate of 40% is:
= $131,600.
c. The after-tax cash flow for the 1st year is:
= $559,400.
Explanation:
a) Data and Calculations;
Cost of new laboratory equipment = $1,770,000
Borrowed capital = $849,600 ($1,770,000 * 48%)
Borrowing rate = 13.4%
Borrowing interest expense for the first year = $113,846
Depreciation = $362,000
Taxable income = $329,000
Gross savings = $X
$X = $804,846 ($113,846 + $362,000 + $329,000)
Income tax for the 1st year:
Marginal tax rate = 40%
Taxable income = $329,000
= $131,600 ($329,000 * 40%)
After-tax Cash Flows for the 1st year:
Gross savings = $804,846
Interest expense 113,846
Depreciation 362,000
Taxable income $329,000
Income tax 131,600
Net income $197,400
Cash Flows:
Net income $197,400
Depreciation 362,000
After-tax cash flow $559,400
Blues Inc. manufactures jeans in the cutting and sewing process. Jeans are manufactured in 40-jean batch sizes. The cutting time is 5 minutes per jean. The sewing time is 20 minutes per jean. It takes 2 minutes to move a batch of jeans from cutting to sewing. a. Compute the value-added, non-value-added, and total lead time of this process. Value-added lead time fill in the blank 1 minutes Non-value-added lead time fill in the blank 2 minutes Total lead time fill in the blank 3 minutes b. Compute the value-added ratio. Round to one decimal place.
Answer:
a. Value added time = Cutting time + Sewing time
Value added time = 5 minutes + 20 minutes
Value added time = 25 minutes
Non-value added time = Total within batch wait time + Move time
Non-value added time = [25 minutes * (40 - 1) + 2 minutes
Non-value added time = 977 minutes
Total lead time = Value added time + Non-value added time
Total lead time = 25 minutes + 977 minutes
Total lead time = 1,002 minutes
b. Value added ratio = Value added time / Total lead time
Value added ratio = 25 minutes / 1,002 minutes
Value added ratio = 0.02495
Value added ratio = 2.5%
Geralt of Rivia is an independent contractor who specializes in monster-killing. His unique skills have earned him the bargaining power to sell his services at a high price to those willing to pay for the removal of infestations of fire elementals, rock trolls, royal wyverns, or the like. Geralt specializes only in hard-to-kill monsters, however, leaving the likes of basiliks and harpies, monsters lower on the totem pole, to less sophisticated monster slayers.
Given these facts, based on the Generic Business Strategies framework, we might say that Geralt occupies the_______ (1) quadrant of the framework.
When Geralt takes a contract from a rich village seeking his aid, they represent a/n _______(2)
Geralt often buys potions and elixirs from various alchemists to help his fighting ability. However, he can make these potions and elixirs himself if he has the time. If he were to do this instead of buying from the alchemists, this would constitute a form of________ (3)
When Geralt takes a contract, it usually requires about a week of planning and preparation, which includes trips to the armorer, time spent making alchemical concoctions that protect him during the confrontation with the monster(s), and the staking out of ideal fighting ground when the battle occurs. As such, Geralt ofter has to choose between contracts, sometimes accepting one contract while forgoing the opportunity to pursue another contract. As we have discussed, this decision constitutes a_________ (4).
Now, let's say that Geralt is governed by a neutral "Council of Witchers" that ensure that those who purchase Geralt's services (e.g., rich villages or principalities plagued by monster infestations) are well-served, and that Geralt spends their gold in ways that work toward the removal of the targeted monsters which these clients have paid to have removed.
We might say that this "Council" serves as Geralt's role in this arrangement. Geralt, in turn, serves as the ______(5) and that the purchasers of Geralt's services, such as rich villages, represent the________ (6) in this arrangement. х (1) differentiation (2) buyer х (3) forward integration (4) tradeoff (5) management х (6) party __________(7) agent
Answer: 1. Differentiation focus
2. Buyer
3. Backward Integration
4. Trade off
5. Board of directors
6. Principal
7. Agent
Explanation:
1. Geralt is using Differentiation focus strategy as it gives the customers a product which they believe is superior than other similar products although the price if the product is higher than others. The product is unique from other products.
2. When Geralt takes a contract from a rich village seeking his aid, they represent a buyer.
3. If Geralt makes the potions and elixirs himself if he has the time rather than buying from the alchemists, this would constitute a form of backward integration. This is because he's expanding his role by taking up a task that's being completed previously in the supply chain.
4. Since Geralt has to choose between contracts, this is a trade off. Trade occurs when we've to choose between alternatives. In this case, we forgo some at the expense of others.
5. Based in the information given, Geralt serves as the board of director.
6. Those who buy Geralt's services, such as rich villages, represent the Principal.
7. Geralt serves as the agent. He's the one negotiating contracts and supplying what's needed.
Which of the following is true? In a one-shot game, a collusive strategy always represents a Nash equilibrium. A subgame perfect equilibrium occurs when each player is doing the best he can regardless of what the other player is doing. Each Nash equilibrium is a subgame perfect equilibrium. Correct! Every subgame perfect equilibrium is a Nash equilibrium.
Answer: Each Nash equilibrium is a subgame perfect equilibrium.
Explanation:
The Nash Equilibrium in a game is the outcome of which neither of the players would want to deviate from because they are making the highest payoff that they can given the other player's possible choice and leaving this outcome would result in a lower payoff.
In every subgame that is based on the original game therefore, the Nash equilibrium represents the perfect equilibrium for the players as it is giving the highest payoff given the circumstances.
Jackpot Mining Company operates a copper mine in central Montana. The company paid $1,750,000 in 2021 for the mining site and spent an additional $750,000 to prepare the mine for extraction of the copper. After the copper is extracted in approximately four years, the company is required to restore the land to its original condition, including repaving of roads and replacing a greenbelt. The company has provided the following three cash flow possibilities for the restoration costs:
Cash Outflow Probability
1 $ 450,000 15 %
2 550,000 45 %
3 750,000 40 %
To aid extraction, Jackpot purchased some new equipment on July 1, 2021, for $270,000. After the copper is removed from this mine, the equipment will be sold. The credit-adjusted, risk-free rate of interest is 12%.
Required:
1. Prepare the journal entries to record the acquisition costs of the mine and the purchase of equipment.
2. Prepare journal entries for :
a. Record the acquisition costs of the mine.
b. Record the purchase of equipment.
Answer:
Jackpot Mining Company
1. Journal Entries to
a) record the acquisition cost of ths mine:
Debit Investment in Copper Mine $1,750,000
Credit Cash $1,750,000
To record the cost of acquiring the mining site
Debit Investment in Copper Mine $750,000
Credit Cash $750,000.
To record the cost of preparing the mine site.
Debit Investment in Copper Mine $390,844
Credit Restoration Liability $390,844
To record the provision for mine restoration liability.
b) the purchase of equipment:
July 1, 2021
Debit Equipment $270,000
Credit Cash $270,000
To record the purchase of equipment.
Explanation:
a) Data and Analysis:
2021 Investment in Copper Mine $1,750,000 Cash $1,750,000
2021 Investment in Copper Mine $750,000 Cash $750,000
Restoration cost:
Cash Outflow Probability Expected Cost
1 $ 450,000 15 % $67,500
2 550,000 45 % 247,500
3 750,000 40 % 300,000
Expected restoration cost = $615,000
Adjusted risk-free interest rate = 12%
Mining period before restoration = 4 years
PV of restoration cost = $390,844
N (# of periods) 4
I/Y (Interest per year) 12
PMT (Periodic Payment) 0
FV (Future Value) $615,000
Results
PV = $390,843.62
Total Interest $224,156.38
Purchase of new equipment"
July 1, 2021 Equipment $270,000 Cash $270,000
Total cost of copper mine:
Acquisition cost $1,750,000
Additional cost 750,000
Restoration cost 390,844
Total cost of mine $2,890,844
Present Value Index Montana Grill has computed the net present value for capital expenditures for the Billings and Great Falls locations using the net present value method. Relevant data related to the computation are as follows: Billings Great Falls Total present value of net cash flow $882,000 $1,050,000 Amount to be invested 900,000 750,000 a. Determine the present value index for each proposal. Round to two decimal places.
Answer:
Billings ⇒ 0.98Great Falls ⇒ 1.40Explanation:
Present value index (PVI)= Total present value of net cash flow / Amount to be Invested
Billings PVI
= 882,000 / 900,000
= 0.98
Great Falls PVI
= 1,050,000 / 750,000
= 1.40
Stephen Company had the following partial list of account balances at year-end: Accounts Receivable: $9,000 Cost of Goods Sold: $34,100 Sales Revenue: $57,200 Accounts Payable: $7,500 Sales Discounts: $1,600 Merchandise Inventory: $5,900 Operating Expenses: $8,400 Sales Returns and Allowances: $4,300 The amount of Gross Profit shown on the income statement would be: A) $ 26,200 B) $ 8,800 C) $ 17,200 D) $ 8,200 E) $ 11,300
Answer:
The correct option is C) $17,200.
Explanation:
The amount of Gross Profit shown on the income statement can be calculated as follows:
Net sales revenue = Sales Revenue - Sales Discounts - ales Returns and Allowances = $57,200 - $1,600 - $4,300 = $51,300
Gross profit = Net sales revenue - Cost of Goods Sold = $51,300 - $34,100 = $17,200
Therefore, the correct option is C) $17,200. That is, the amount of Gross Profit shown on the income statement would be $17,200.
Required information Skip to question [The following information applies to the questions displayed below.] ABC Company prepared the following aging of receivables analysis at December 31. Days Past Due Total 0 1 to 30 31 to 60 61 to 90 Over 90 Accounts receivable $ 640,000 $ 410,000 $ 104,000 $ 50,000 $ 32,000 $ 44,000 Percent uncollectible 3 % 4 % 7 % 9 % 12 % a. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method. b. Prepare the adjusting entry to record Bad Debts Expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $13,400 credit. c. Prepare the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $2,400 debit. Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method.
Answer:
A. $32,000
B. Dec 31
Dr Bad debts expense $18,600
Cr Allowance for doubtful accounts $18,600
C. Dec 31
Dr Bad debts expense $34,400
Cr Allowance for doubtful accounts $34,400
Explanation:
a. Calculation to Estimate the balance of the Allowance for Doubtful Accounts assuming the company uses 5% of total accounts receivable to estimate uncollectibles, instead of the aging of receivables method
Accounts receivable
Not due $ 410,000
1 to 30 $ 104,000
31 to 60 $ 50,000
61 to 90 to$ 32,000
Over 90 $44,000
Total Accounts receivable $640,000
Estimate the balance of the Allowance for Doubtful Accounts=$640,000*5%
Estimate the balance of the Allowance for Doubtful Accounts=$32,000
Therefore the Estimated balance of the Allowance for Doubtful Accounts will be $32,000
b. Preparation of the adjusting entry to record Bad Debts Expense from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $13,400 credit.
Dec 31
Dr Bad debts expense $18,600
Cr Allowance for doubtful accounts $18,600
($32,000-$13,400)
(To record Bad Debts Expense)
c. Preparation ofn the adjusting entry to record bad debts expense using the estimate from part a. Assume the unadjusted balance in the Allowance for Doubtful Accounts is a $2,400 debit.
Dec 31
Dr Bad debts expense $34,400
Cr Allowance for doubtful accounts $34,400
($32,000+$2,400)
(To record bad debts expense )
Mrs. Eller's corporate employer has a cafeteria plan under which its employees can receive a $3,000 year-end Christmas bonus or enroll in a qualified medical reimbursement plan that pays up to $3,000 of annual medical bills. Mrs. Eller is in a 24 percent tax bracket, and her medical bills average $2,300 each year.
a. Should Mrs. Eller choose the cash bonus or the nontaxable fringe benefit? (Ignore any payroll tax implications.)
b. Does your answer change if Mrs. Eller is in the 12 percent tax bracket?
Answer and Explanation:
a. The computation is shown below;
Cash bonus after tax is ($3,000 × (1 - 0.24) $2,280
And, non taxable fringe benefit is $2,300
So here he should use the nontaxable fringe benefit
b. Yes answer would be changed
Cash bonus after tax is ($3,000 × (1 - 0.12) $2,640
And, non taxable fringe benefit is $2,300
hence, the same is to be considered
Calculate the cash dividends required to be paid for each of the following preferred stock issues: Required: The semiannual dividend on 6% cumulative preferred, $62 par value, 8,200 shares authorized, issued, and outstanding. The annual dividend on $2.25 cumulative preferred, 130,000 shares authorized, 78,000 shares issued, 68,900 shares outstanding. Last year's dividend has not been paid. The quarterly dividend on 10.0% cumulative preferred, $90 stated value, $106 liquidating value, 78,000 shares authorized, 67,600 shares issued and outstanding. No dividends are in arrears.
Answer:
Preferred dividend calculation:
= Percentage return * Par Value * number of shares
a. The semiannual dividend on 6% cumulative preferred, $62 par value, 8,200 shares authorized, issued, and outstanding.
= 6% * 62 * 8,200 * 1/2 years
= $15,252
b. The annual dividend on $2.25 cumulative preferred, 130,000 shares authorized, 78,000 shares issued, 68,900 shares outstanding. Last year's dividend has not been paid.
In this case, last year's dividend was not paid and this is a cumulative preferred stock so the dividend will be accrued from last year and paid this year.
= Preferred dividend * 2 years
= (2.25 * 68,900 shares outstanding) * 2
= $310,050
c. The quarterly dividend on 10.0% cumulative preferred, $90 stated value, $106 liquidating value, 78,000 shares authorized, 67,600 shares issued and outstanding. No dividends are in arrears.
= 10% * 90 * 67,600 * 1/4 years
= $152,775
The production department in a process manufacturing system completed 80,000 units of product and transferred them to finished goods during a recent period. Of these units, 32,000 were in process at the beginning of the period. The other 48,000 units were started and completed during the period. At period-end, 17,500 units were in process.
Prepare the department’s equivalent units of production with respect to direct materials under each of the three separate assumptions using the FIFO method for process costing.
If Apple uses the variable cost method to set selling prices and plans a markup of 200% of variable costs, what is the expected selling price per unit of this new phone? 2. Assume that Apple is a "price taker" and the market sales price for this type of phone is $800 per unit. Compute Apple’s target cost if the company desires a profit of 60% of sales price.
Question Completion:
Assume Apple is designing a new smartphone. Each unit of this new phone is expected to require $230 of direct materials, $10 of direct labor, $20 of variable overhead, and $20 of variable selling and administrative costs.
Answer:
Apple
1. The expected selling price per unit of this new phone is:
= $860.
2. Apple's target cost if the company desires a profit of 60% of the sales price is:
= $320.
Explanation:
a) Data and Calculations:
Method of setting prices = 200% Markup on Variable Cost
Direct materials cost per unit = $230
Direct labor cost per unit = $10
Variable overhead cost per unit = $20
Variable selling and administrative cost per unit = $20
Total variable cost = $280
Markup = $560
Expected selling price = $840
Selling price per unit = $800
Target profit of sales price = 480
Target cost = $320
= $800 * (100 - 60)
= $320