Answer and Explanation:
1. The preparation of the investing activities is presented below:
Cash flow from investing activities
Proceeds from sale of land $25.7
Purchase of equipment for cash -$30.7
Purchase of GE stock -$35.7
Net cash used by investing activities -$40.7
2. The preparation of the financing activities is presented below:
Cash flow from financing activities
Sale of preferred stock 150.7
Issuance of bonds payable for cash 140.7
Payment of cash dividends declared in previous year -130
Purchase of treasury stock -120
Payment for the early extinguishment of long-term notes (carrying (book) value: $100 million) -110.7
Net cash used by financing activities -$69.3
The minus sign shows the cash outflow and the positives sign shows the cash inflow
Part U16 is used by Mcvean Corporation to make one of its products. A total of 18,000 units of this part are produced and used every year. The company's Accounting Department reports the following costs of producing the part at this level of activity: Per Unit Direct materials $ 3.90 Direct labor $ 8.50 Variable manufacturing overhead $ 9.00 Supervisor's salary $ 4.40 Depreciation of special equipment $ 2.80 Allocated general overhead $ 8.00 An outside supplier has offered to make the part and sell it to the company for $28.70 each. If this offer is accepted, the supervisor's salary and all of the variable costs, including the direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company, none of which would be avoided if the part were purchased instead of produced internally. In addition, the space used to make part U16 could be used to make more of one of the company's other products, generating an additional segment margin of $30,000 per year for that product. The annual financial advantage (disadvantage) for the company as a result of buying part U16 from the outside supplier should be: g
Answer:
$22,200 disadvantage
Explanation:
The computation of the financial advantage or disadvantage of buying part from the outside supplier is shown below:
= Avoidable making cost - buying cost + additional segment margin
where,
Avoidable Making cost is
= ($3.90 + $8.50 + $9 + $4.4) × 18,000
= $464,400
Buying cost is
= $28.7 × 18,000
= $516,600
And the additional segment is $30,000 per year
So, the financial advantage or disadvantage is
= $464,400 - $516,600 + $30,000
= $22,200 disadvantage
We simply applied the above formula
Martin Services Company provides its employees vacation benefits and a defined contribution pension plan. Employees earned vacation pay of $49,000 for the period. The pension plan requires a contribution to the plan administrator equal to 6% of employee salaries. Salaries were $500,000 during the period. a. Provide the journal entry for the vacation pay. b. Provide the journal entry for the pension benefit.
Answer:
a. Provide the journal entry for the vacation pay
Debit Vacation and Holiday expense $49,000
Credit Vacation and Holiday payable $49,000
(To record earned Vacation and Holiday expenses)
b. Provide the journal entry for the pension benefit
Debit Pension expense $30,000
Credit Pension liability $30,000
(Being pension benefit recognition)
Explanation:
The earned vacation and holiday expense has to be recognized in line with the accrual principle of accounting.The pension benefit was also recognized in line with the accrual principle of account. The pension plan is a contribution of 6% of employee salaries, which amounted to $500,000. So, 0.06 x 500,000 = $30,000.Department G had 2,400 units 25% completed at the beginning of the period, 13,300 units were completed during the period; 2,000 units were 20% completed at the end of the period, and the following manufacturing costs debited to the departmental work in process account during the period:
Work in process, beginning of period $32,200
Costs added during period:
Direct materials (12,900 units at $9) 116,100
Direct labor 75,000
Factory overhead 25,000
All direct materials are placed in process at the beginning of production and the first-in, first-out method of inventory costing is used. What is the total cost of the units started and completed during the period (round unit cost calculations to four decimal places and round your final answer to the nearest dollar)?
a. $197,947
b. $181,306
c. $164,665
d. $98,100
Answer:
The total cost of the units started and completed during the period is $181,306. The right answer is b
Explanation:
In order to calculate the total cost of the units started and completed during the period we would have to calculate the Equivalent units as follows:
Equivalent units:
Whole units material conversion
Beginning units 2,400 0 1,800(75%)
Units started and complete 10,900 10,900 10,900
(13,300-2,400)
Total transferred 13,300 10,900 $ 12,700
Ending units 20,00 2,000 400(20%)
Equivalent units 15,300 12,900 13,100
Equivalent cost per unit:
Material conversion
Cost incurred this period $116,100 $100,000
÷ equivalent units ×12,900 ÷13,100
Cost per equivalent unit $9 $7.6336
Therefore, the total cost of the units started and completed during the period =10,900 units×($9+7.6336)
=$181,306
he following data has been collected about Keller Company's stockholders' equity accounts: Common stock $10 par value 30,000 shares authorized and 15,000 shares issued, 2,000 shares outstanding $150,000 Paid-in capital in excess of par value, common stock 60,000 Retained earnings 35,000 Treasury stock 25,000 Assuming the treasury shares were all purchased at the same price, the number of shares of treasury stock is:
Answer:
13,000 shares
Explanation:
data provided for computing the number of shares of treasury stock is here below:-
Issued Share = 15,000
Outstanding Shares = 2,000
The computation of the number of shares of treasury stock is shown below:-
Number of shares of treasury stock = Issued Share - Outstanding Shares
= 15,000 - 2,000
= 13,000 shares
Therefore for computing the number of shares of treasury stock we simply deduct the outstanding share from issued shares.
Depreciation by Two Methods A storage tank acquired at the beginning of the fiscal year at a cost of $80,000 has an estimated residual value of $4,000 and an estimated useful life of 20 years. a. Determine the amount of annual depreciation by the straight-line method. $ b. Determine the amount of depreciation for the first and second years computed by the double-declining-balance method. Do not round the double-declining balance rate. If required, round your answers to the nearest dollar.
Answer:
a. Annual depreciation = $3,800
b. First year depreciation is $8,000' while second year depreciation is $7,200.
Explanation:
a. Determine the amount of annual depreciation by the straight-line method.
Depreciable amount = $80,000 - $4,000 = $76,000
Annual depreciation = $76,000 / 20 = $3,800
b. Determine the amount of depreciation for the first and second years computed by the double-declining-balance method. Do not round the double-declining balance rate. If required, round your answers to the nearest dollar.
Straight line depreciation rate = 1 / 20 = 0.05, or 5%
Double declining depreciation rate = 5% * 2 = 10%
First year depreciation = $80,000 * 10% = $8,000
Second year depreciation = ($80,000 - $8,000) * 10% = $7,200
All of the following are correct statements about transfers between divisions located in countries with different tax rates except that
A. differences in tax rates across countries complicate the determination of the appro-priate transfer price
B. a decreasing number of transfers are between divisions located in different countries
C. companies must pay income tax in the country where income is generated
D. many companies prefer to report more income in countries with low tax rates.
All of the following are correct statements about transfers between divisions located in countries with different tax rates except that the companies must pay income tax in the country where income is generated. Thus option (C) is correct.
What is tax?Taxes are mandatory contributions levied on individuals or corporations by a government entity—whether local, regional, or national.
Tax revenues finance government activities, including public works and services such as roads and schools, or programs such as Social Security and Medicare.
In economics, taxes fall on whoever pays the burden of the tax, whether this is the entity being taxed, such as a business, or the end consumers of the business’s goods.
From an accounting perspective, there are various taxes to consider, including payroll taxes, federal and state income taxes, and sales taxes.
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Allegheny Company ended Year 1 with balances in Accounts Receivable and Allowance for Doubtful Accounts of $68,000 and $3,450, respectively. During Year 2, Allegheny wrote off $6,300 of Uncollectible Accounts. Using the percent of receivables method, Allegheny estimates that the ending Allowance for Doubtful Accounts balance should be $5,400. What amount will Allegheny report as Uncollectible Accounts Expense on its Year 2 income statement
Answer:
$8,250
Explanation:
Relevant data provided for compute the Uncollectible Accounts Expense is here below:-
Amount written off = $6,300
Closing balance = $5,400
Opening balance = $3,450
The computation of Uncollectible Accounts Expense is shown below:-
Uncollectible Accounts Expense = Amount written off + Closing balance - Opening balance
= $6,300 + $5,400 - $3,450
= $11,700 - $3,450
= $8,250
Therefore for computing the Uncollectible Accounts Expense we simply applied the above formula.
Brainliest for anyone if they get this CORRECT.
Answer:
20% is your best answer choice.
Explanation:
We are looking at the people who will be willing to buy sandwiches from $4.01 to $5, or the purple color.
The purple color takes up just a little less than a quarter of the circle (25%). The closest answer to 25% that is still less than 25% is 20%, so B. is your best answer.
~
Answer:
It would be 20%
Explanation:
1+2+7+4+6 = 20
20%
The president of Ravens Inc. attended a seminar about the contribution margin model and returned to her company full of enthusiasm about it. She requested that last year’s traditional model income statement be revised, and she received the following report: Division Total Company A B C Sales $ 484,000 $ 188,000 $ 128,000 $ 168,000 Variable expenses 268,000 112,000 66,000 90,000 Contribution margin $ 216,000 $ 76,000 $ 62,000 $ 78,000 Fixed expenses 172,000 54,000 68,000 50,000 Net income (loss) $ 44,000 $ 22,000 $ (6,000 ) $ 28,000 The president was told that the fixed expenses of $172,000 included $94,500 that had been split evenly between divisions because they were general corporate expenses. After looking at the statement, the president exclaimed, "I knew it! Division B is a drag on the whole company. Close it down!"
Evaluate the President's remark.
Answer and Explanation:
a. The president remark in case of the allocated fixed expenses should be ignored the misleading result as it is seen that the division B has suffered a loss of $6,000 due to which the president exclaimed "I knew it!.
Moreover the president ignored the given information i.e $172,000 included $94,500 that had been split evenly between divisions as they are classified as a general corporate expenses
So if it is split evenly the general corporate expenses for division B is $31,500 which is come from by dividing the $94,500 from 3 divisions
And if we do not allocated the expenses so all divisions would come in profit
Sardi Inc. is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 14,200 of the components each year. The unit product cost of the component according to the company's cost accounting system is given as follows: Direct materials $ 10.00 Direct labor 7.00 Variable manufacturing overhead 2.80 Fixed manufacturing overhead 4.80 Unit product cost $ 24.60 Assume that direct labor is a variable cost. Of the fixed manufacturing overhead, 30% is avoidable if the component were bought from the outside supplier. In addition, making the component uses 1 minutes on the machine that is the company's current constraint. If the component were bought, time would be freed up for use on another product that requires 2 minutes on this machine and that has a contribution margin of $6.40 per unit. When deciding whether to make or buy the component, what cost of making the component should be compared to the price of buying the component? (Round your intermediate calculations to 2 decimal places.)
Answer:
Total cost $24.44
Explanation:
Sardi Inc.
Make
Direct materials$10.00
Direct labor7.00
Variable manufacturing overhead 2.80
Fixed manufacturing overhead (30% × $4.80 is avoidable)1.44
Opportunity cost ($6.40 per unit ÷ 2 minutes per unit) × 1 minutes3.20
Total cost $24.44
Therefore the cost of making the component should be compared to the price of buying the component at $24.44
Please help ASAP giving BRAINLIEST , Did I get this correct?
Answer:
Yes you are correct on this researched it
Answer:
YEAH:)
Explanation:
On January 1, Year 1, Bryson Company obtained a $147,750, four-year, 7% installment note from Campbell Bank. The note requires annual payments of $43,620, beginning on December 31, Year 1. Prepare an amortization table for this installment note, similar to the one presented in Exhibit 4. Journalize the entries for the issuance of the note and the four annual note payments. Describe how the annual note payment would be reported in the Year 1 income statement.
Answer and Explanation:
According to the scenario, computation of the given data are as follow:-
1) The amortization schedule is presented on the attachment below:
2).
Journal Entry
1 Jan Cash A/c Dr. $147,750
To Notes payable A/c $147,750
(Being the cash received is recorded)
31 Dec Interest expense A/c Dr. $10,342.50
Notes payable A/c $33,277.50
To Cash A/c $43,620
(Being the annual payment of installment including interest is recorded)
31 Dec Interest expense A/c Dr. $8,013.08
Notes payable A/c $33,606.93
To Cash A/c $43,620
(Being the annual payment of installment including interest is recorded)
31 Dec Interest expense A/c Dr. $5,520.59
Notes payable A/c $38,099.41
To Cash A/c $43,620
(Being the annual payment of installment including interest is recorded)
31 Dec Interest expense A/c Dr. $2,853.83
Notes payable A/c $40,766.17
To Cash A/c $43,620
(Being the annual payment of installment including interest and setting off liabilities is recorded)
3).
Bryson Company
Income Statement
Particular Amount ($)
Revenue -
Expenses
Less - Interest expense 10,342.50
Less - Other expenses -
Net Income -
Picayune company purchased 40,000 of Stewart Company's 100,000 shares for $400,000 on 1/1/X1 when Stewart's equity consisted of $500,000 capital stock and $500,000 of retained earnings. An appraisal of Stewart's assets failed to identify any mis-valued assets. Picayune designated the Investment as a fair value investment. During year X1, Stewart earned a $100,000 net income and paid $50,000 of dividends. On 12/31/X1, Stewart's stock traded at $10.20 per share. How much investment income should Picayune recognize in year X1?
Answer:
a. $8,000
b. $20,000
c. $28,000
d. $40,000
The correct answer is B,$20,000
Explanation:
The investment income attributable to entire shareholders of Picayune is the amount of dividends paid,which is $50,000.
Out of which Picayune is entitled to 40% (40,000/100,000) based on the shareholding of Picayune in Stewart Company.
Dividends received by Picayune =40%*$50,000=$20,000
The investment income of Picayune to be recognized in year X1 is $20,000
Proper payroll accounting methods are important for a business for all of the following reasons except a.payroll is subject to various federal and state regulations b.good employee morale requires timely and accurate payroll payments c.to help a business with cash flow problems by delayed payments of payroll taxes to federal and state agencies d.payroll and related payroll taxes have a significant effect on the net income of most businesses
Answer:
Option C
Explanation:
In simple words, Payroll Accounting refers to the task of estimating and delivering to workers and other organizations pay , bonuses and allowances. That is usually achieved by various papers, including time sheets, earnings, as well as an accounting register.
Payroll management actually tracks an enterprise's payroll costs through accounting records. Payroll planning covers both cost and liability reports which including FICA Payable Payments, fed and provincial taxes Payable, Life Care Contributions Payable, etc.
Showcase Co., a furniture wholesaler, sells merchandise to Balboa Co. on account, $254,500, terms n/30. The cost of the goods sold is $152,700. Showcase issues a credit memo for $30,000 for merchandise returned prior to Balboa paying the original invoice. The cost of the merchandise returned is $17,500. Journalize Balboa Co.’s entries for (a) the purchase, (b) the return of the merchandise for credit, and (c) the payment of the invoice. Refer to the Chart of Accounts for exact wording of account titles.
Answer:
Mar. 1
Dr Accounts Receivable-Balboa Co.254,500
Cr Sales254,500
March 1
Dr Cost of Merchandise Sold 152,700
Cr Merchandise Inventory 152,700
March 5
Dr Customers Refunds Payable30,000
Cr Accounts Receivable-Balboa Co.30,000
March 5
Dr Merchandise Inventory 17,500
Cr Estimated Returns Inventory17,500
March 29
Dr Cash 224,500
Cr Accounts Receivable-Balboa Co.224,500
Explanation:
Showcase Co Journal entries
Mar. 1
Dr Accounts Receivable-Balboa Co.254,500
Cr Sales254,500
March 1
Dr Cost of Merchandise Sold 152,700
Cr Merchandise Inventory 152,700
March 5
Dr Customers Refunds Payable30,000
Cr Accounts Receivable-Balboa Co.30,000
March 5
Dr Merchandise Inventory 17,500
Cr Estimated Returns Inventory17,500
March 29
Dr Cash 224,500
Cr Accounts Receivable-Balboa Co.224,500
Amount enter for Purchase, return of the merchandise and payment of the invoice are $254,500, $30,000 and $224,500
Journal entries;Journal entry:
Number Particular Debit Credit
A. Merchandise Inventory $254500
To Accounts Payable $254500
B. Accounts Payable $30000
To Merchandise Inventory $30000
C. Accounts Payable $224500
To Cash $224500
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The 12/31/2018 balance sheet of Despot Inc. included the following: Common stock, 25 million shares at $20 par $ 500 million Paid-in capital—excess of par 3,000 million Retained earnings 980 million In January 2018, Despot recorded a transaction with this journal entry: Cash 150 million Common stock 100 million Paid-in capital—excess of par 50 million In February 2018, Despot declared cash dividends of $12 million to be paid in April of that year. What effect did the April transaction have on Despot's accounts? Decreased assets and liabilities. Increased liabilities and decreased shareholders' equity. Decreased assets and shareholders' equity. None of these answer choices are correct
Answer: Decreased assets and liabilities.
Explanation:
Both assets and Liabilities decrease as a result of the April transaction because first, Cash is used to pay the Dividend which reduces the cash account and Cash is an Asset.
Liabilities also decrease because when the dividends were declared in February, Despot Inc had to create a liability in their books to cater for the payment of the dividends. Now that the dividends have been paid, that figure will be removed therefore reducing Liabilities.
Femur Co. acquired 70% of the voting common stock of Harbor Corp. on January 1, 2019. During 2019, Harbor had revenues of $2,500,000 and expenses of $2,000,000. The amortization of fair value allocations totaled $60,000 in 2019. Not including its investment in Harbor, Femur Co. had its own revenues of $4,500,000 and expenses of $3,000,000 for the year 2019. What is the noncontrolling interest's share of earnings for Harbor Corp
Answer:
$1,808,000
Explanation:
The noncontrolling interest's share of the earnings of Harbor Corp. for 2019 is calculated to be:
=($2,500,000 - $2,000,000- $60,000) * 0.3 = $132,000
Amount of consolidated net income for 2019 should be allocated to Femur’s controlling interest in Harbor
= $440,000 - $132,000 = $308,000
Amount Femur Co. would report as consolidated net income for 2019:
= $1,500,000 + $308,000 = $1,808,000
Doogan Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 8.3 grams $ 2.90 per gram Direct labor 0.4 hours $ 29.00 per hour Variable overhead 0.4 hours $ 7.90 per hour The company produced 6,100 units in January using 40,210 grams of direct material and 2,470 direct labor-hours. During the month, the company purchased 45,300 grams of the direct material at $2.60 per gram. The actual direct labor rate was $28.30 per hour and the actual variable overhead rate was $7.70 per hour. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The variable overhead rate variance for January is:
Answer:
Manufacturing overhead rate variance= $494 favorable
Explanation:
Giving the following information:
Variable overhead 0.4 hours $ 7.90 per hour
The company produced 6,100 units in January using 2,470 direct labor-hours.
The actual variable overhead rate was $7.70 per hour.
To calculate the variable overhead rate variance, we need to use the following formula:
Manufacturing overhead rate variance= (standard rate - actual rate)* actual quantity
Manufacturing overhead rate variance= (7.9 - 7.7)*2,470
Manufacturing overhead rate variance= $494 favorable
Today, Social Networking and Social Analytics are heavily used by businesses and companies externally for the marketing of products and services to their customers and customer feedback. How can Social Networking and Social Analytics implemented within a workforce for collaboration and knowledge sharing be useful
Explanation:
The internet has revolutionized the way people communicate and seek information, so companies need to adapt to this reality and seek out where their target audience is. Social networks and Social Analytics can be essential tools for a company's business, due to the possibility of creating a more direct relationship between the brand and the consumer.
Through social networks companies can create content that creates value for users and consequently increases brand awareness and positioning, in addition to being a direct channel where communication takes place instantly, in addition to being a cheap and effective advertising strategy.
Social Analytics is a tool that helps companies to optimize their social networks through the collection of data and information that enable the analysis of interactions and thus the analysis of consumer perception in relation to it, which helps in the optimization of marketing strategies. marketing and customer service.
Becton Labs, Inc., produces various chemical compounds for industrial use. One compound, called Fludex, is prepared using an elaborate distilling process. The company has developed standard costs for one unit of Fludex, as follows: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 2.50 ounces $ 22.00 per ounce $ 55.00 Direct labor 0.90 hours $ 16.00 per hour 14.40 Variable manufacturing overhead 0.90 hours $ 2.00 per hour 1.80 Total standard cost per unit $ 71.20 During November, the following activity was recorded related to the production of Fludex: Materials purchased, 14,000 ounces at a cost of $289,800. There was no beginning inventory of materials; however, at the end of the month, 4,050 ounces of material remained in ending inventory. The company employs 26 lab technicians to work on the production of Fludex. During November, they each worked an average of 150 hours at an average pay rate of $15.00 per hour. Variable manufacturing overhead is assigned to Fludex on the basis of direct labor-hours. Variable manufacturing overhead costs during November totaled $5,000. During November, the company produced 3,900 units of Fludex. Required: 1. For direct materials: a. Compute the price and quantity variances. b. The materials were purchased from a new supplier who is anxious to enter into a long-term purchase contract. Would you recommend that the company sign the contract
Answer and Explanation:
a. The computation is shown below:
Material price variance
= Actual Quantity × (Standard Price - Actual Price)
= 14,000 × ($22 - $289,800 ÷ 14,000)
= 14,000 × ($22 - $20.70)
= 14,000 × $1.30
= $18,200 favorable
Material quantity variance
= Standard Price × (Standard Quantity - Actual Quantity)
= $22 × (3,900 units × 2.5 - 14,000 ounces - 4,050 ounces)
= $22 × (9,750 - 9,950)
= $22 × 200
= $4,400 unfavorable
b. Yes the contract should be signed as it is the actual price i.e $20.70 is less than the standard price $22
Vaughn Manufacturing expects to purchase $180000 of materials in July and $170000 of materials in August. Three-fourths of all purchases are paid for in the month of purchase, and the other one-fourth are paid for in the month following the month of purchase. How much will August's cash disbursements for materials purchases be?
Answer:
The August's cash disbursements for materials purchases would be
$172,500.00 for Vaughn Manufacturing
Explanation:
The cash disbursements in the month of August consist of the three-fourth cost of the August purchases and the one-fourth of the July purchases since the 3/4 of the cost of materials purchased is paid in the same month as purchases and the balance of 1/4 of purchase cost in the succeeding month
Cash disbursements in August=($170,000*3/4)+($180,000*1/4)=$127500 +$45,000=$172,500.00
As a long-term investment at the beginning of the 2021 fiscal year, Florists International purchased 25% of Nursery Supplies Inc.’s 8 million shares of capital stock for $40 million. The fair value and book value of the shares were the same at that time. The company realizes that this investment typically would be accounted for under the equity method, but instead chooses to measure the investment at fair value. During the year, Nursery Supplies reported net income of $40 million and distributed cash dividends of $2.00 per share. At the end of the year, the fair value of the shares is $35 million.
Required:
1. How would this investment be classified on Florists' balance sheet?
2. Prepare all appropriate journal entries related to the investment during 2021, under the fair value option, and in a manner similar to what Florists would use for investments in equity securities for which it does not have significant influence.
Record the purchase.
Record the dividends.
Record any adjusting entry needed at year-end for the change in fair value.
Answer:
how many questions are there
.
Explanation:
A marketing manager wants to build a strong relationship with the customers and to customize messages without high costs. He understands that relationship building and message customization would require constant updating of the database due to the reliance on CRM and he plans to hire staff to make sure the database stays up to date. Based on the manager's consideration, ________ will be the most appropriate promotion mix element.
Answer:
Direct marketing and interactive marketing.
Explanation:
In a case of direct marketing here, they do research, identify customers, select media (TV, direct mail, internet), and create a campaign. But rather than guess whether the message worked, they track the consumer's response. How many people (and of what age, ethnic group, income level) called the number in the catalog, clicked the button on the website, or went to the store for their gift with purchase. This is because direct marketers can measure the results, they can make the next campaign even better.
While in the other hand, interactive marketing explained to be the fastest growing form of marketing where sellers do chats and explanations that comes off as convincing approach of their products to their buyers, this could be physically or online.
Option A has an expected value of $2,000, a minimum payoff of -$4,000, and a maximum payoff of $18,000. Option B has an expected value of $2,200, a minimum payoff of -$1,000, and a maximum payoff of $6,000. Option C has an expected value of $1,900, a minimum payoff of $100, and a maximum payoff of $2,000. In this situation, a risk-averse decision maker would pay __________ for his risk aversion, and a risk-seeking decision maker would pay __________ for his risk seeking.
Answer:
Option A is the answer
Explanation:
A risk-averse decision maker will go for the option with the least chance of loss incurred (the highest minimum payoff of $100) and settle for an expected value of 1900. He'll pay for his risk avoidance in this way (2200-1900 = 300) while a risk-seeking decision maker will go for the option with the highest payoff chances ($18,000), regardless of the possibility of failure. This would make the risk-seeking decision maker go for option A.
Samco signed a 5-year note payable on January 1, 2018, of $ 475 comma 000. The note requires annual principal payments each December 31 of $ 95 comma 000 plus interest at 9%. The entry to record the annual payment on December 31, 2021, includes A. a debit to Interest Expense for $ 17 comma 100. B. a debit to Interest Expense for $ 42 comma 750. C. a credit to Cash of $ 137 comma 750. D. a credit to Notes Payable for $ 95 comma 000.
Answer:
Option A, a debit to Interest Expense for $ 17 comma 100 is correct
Explanation:
The principal amount on 1st January 2021 needs to be established since that would be the amount left after 2018,2019,2020 principals have been repaid
Principal at 1st January 2021=$475,000-($95,000*3)=$190000
Interest on principal in 2021=$190000 *9%=$17100
Total repayment in 2021=principal plus interest=$95,000+$17,100=$ 112,100.00
The $95,000 would be a debit to notes payable not credit hence option is wrong.
Only option A,a debit of $17,100 to interest expense is correct
Data concerning Pony Corporation's single product appear below: Per Unit Percent of Sales Selling price $ 200 100 % Variable expenses 40 20 % Contribution margin $ 160 80 % Fixed expenses are $531,000 per month. The company is currently selling 4,000 units per month. The marketing manager would like to cut the selling price by $14 and increase the advertising budget by $35,000 per month. The marketing manager predicts that these two changes would increase monthly sales by 500 units. What should be the overall effect on the company's monthly net operating income of this change
Answer:
$18,000
Explanation:
The computation of overall effect on the company's monthly net operating income is shown below:-
Current Proposed
Sales $800,000 $837,000
(200 × 4000) (200 - 14) × (4,000 + 500)
Variable expenses $160,000 $180,000
(40 × 4000) (40 × (4,000 + 500))
Contribution margin $640,000 $657,000
Fixed expenses $531000 $566,000
($531,000 + $35,000)
Net operating
income $109,000 $91,000
Decrease in net operating income = Current - Proposed
= $109,000 - $91,000
= $18,000
So, for computing the overall effect on the company's monthly net operating income we simply applied the above formula.
An investment, which has an expected return of 15%, is expected to make annual cash flows forever. The first annual cash flow is expected today and all subsequent annual cash flows are expected to grow at a constant rate of 5% per year. The cash flow expected today is expected to be $20000. What is the present value (as of today) of the cash flow that is expected to be made in 9 years from today?
Answer:
$19,999.64
Explanation:
Kindly check the attached picture for explanation
A company has two departments, Y and Z that incur delivery expenses. An analysis of the total delivery expense of $12,000 indicates that Dept. Y had a direct expense of $1,300 for deliveries and Dept. Z had no direct expense. The indirect expenses are $10,700. The analysis also indicates that 60% of regular delivery requests originate in Dept. Y and 40% originate in Dept. Z. Departmental delivery expenses for Dept. Y and Dept. Z, respectively, are: Multiple Choice $7,330; $6,000. $7,330; $4,670. $7,720; $4,280. $7,200; $4,800. $6,000; $6,000.
Answer:
$7,720; $4,280
Explanation:
total delivery expense = $12,000
Dept. Y Dept. Z
direct expenses $1,300 $0*
indirect expenses ($10,700 x 60%) ($10,700 x 40%)
$6,420 $4,280
total delivery expenses $7,720 $4,280
*Since no direct delivery expenses were generated by Dept. X, no amount should be allocated. Indirect expenses are allocated based on the percent generated by each department.
A company had the following purchases and sales during its first year of operations: Purchases Sales January: 22 units at $180 14 units February: 32 units at $185 12 units May: 27 units at $190 16 units September: 24 units at $195 15 units November: 22 units at $200 28 units On December 31, there were 42 units remaining in ending inventory. Using the Perpetual LIFO inventory valuation method, what is the cost of the ending inventory
Answer:
$7,815
Explanation:
As per Perpetual LIFO inventory valuation method the inventory purchased at last will be sold first and the value of ending inventory can be calculated as follows. The inventory sold has been deducted from the purchased inventory in that period first and then has been deducted from the previous period to arrive at the cost of ending inventory;
January: 8 units x $180 = $1,440
February: 20 units x $185 = $3,700
May: 11 units x $190 = $2,090
September: 3 units x $195 = $585
Cost of Ending Inventory of 42 units is $7,815
Absorption and variable costing. (CMA) Miami, Inc., planned and actually manufactured 250,000 units of its single product in 2017, its first year of operation. Variable manufacturing cost was $19 per unit produced. Variable operating (nonmanufacturing) cost was $13 per unit sold. Planned and actual fixed manufacturing costs were $750,000. Planned and actual fixed operating (nonmanufacturing) costs totaled $420,000. Miami sold 170,000 units of product at $41 per unit.
Required:
1. Miami's 2017 operating income using absorption costing is:
(a) $ 600,000
(b) $ 360,000
(c) $ 780,000
(d) $ 1,020,000
(e) None of above
2. Miami's 2017 operating income using variable costing is:(a) $ 1,100,000(b) $ 600,000(c) $ 360,000(d) $ 780,000(e) None of above
Answer:
1.(b) $ 360,000
2. (c) $ 360,000
Explanation:
Miami, Inc.
Absorption Costing
Income Statement
Sales 170,000 units * $41 $ 6970,000
Variable manufacturing cost $19 *170,000 units = 3230,000
Actual fixed manufacturing costs $750,000
Contribution Margin $ 2990,000
Variable operating (non manufacturing) cost $13 *170,000 units =2210,000
Actual fixed operating (non manufacturing) costs $420,000
Operating Income $ 360,000
The difference b/w variable and absorption costing is that in variable costing the variable expenses are treated as product costs and fixed expenses as period costs. But in absorption costing the manufacturing expenses variable and fixed are treated as product costs and selling and administrative expenses both fixed and variable are treated as period costs.
Miami, Inc.
Variable Costing
Income Statement
Sales 170,000 units * $41 $ 6970,000
Variable manufacturing cost $19 *170,000 units = 3230,000
Variable operating (non manufacturing) cost $13 *170,000 units =2210,000
Contribution Margin $1530,000
Actual fixed manufacturing costs $750,000
Actual fixed operating (non manufacturing) costs $420,000
Operating Income $ 360,000
