Answer:
12870.62
Explanation:
I assume that Sammy has $143,000 on her retirement account.
this is an annuity due (the first distribution is received immediately), so we can use the present value of an annuity due formula to calculate the yearly distributions:
PV = payment x annuity factor
PV = $143,000PV annuity due factor, 6.5%, 18 periods = 11.11058payment = $143,000 / 11.11058 = $12,870.62
what is financial accounting with example
Answer:
Financial accounting refers to recording and organizing these transactions into categories in order to prepare financial statements. All financial statements must be recorded in accordance with GAAP ( generally accepted accounting principles). Examples of financial statements include : income statement and balance sheet.
example:
sold a motor vehicle for $10000 and received cash
under non-current assets - motor vehicle decreases by 10000
under current assets - cash increases by 10000
what type of change is individual change
Answer:
Individual change is the fact that one person can understand how another can make an internal change without an external force .
Explanation:
Individual is like an internal which is yourself doing something
Change - a development
a celebrity appearing in a commercial for a soft drink while wearing a certain brand of clothing and holding a certain brand of tennis racquet is an example of?
The following transactions occurred during the month of June 2018 for the Stridewell Corporation. The company owns and operates a retail shoe store.
1. Issued 140,000 shares of common stock in exchange for $700,000 cash.
2. Purchased furniture and fixtures at a cost of $113,750. $45,500 was paid in cash and a note payable was signed for the balance owed.
3. Purchased inventory on account at a cost of $280,000. The company uses the perpetual inventory system.
4. Credit sales for the month totaled $476,000. The cost of the goods sold was $238,000.
5. Paid $6,500 in rent on the store building for the month of June.
6. Paid $3,360 to an insurance company for fire and liability insurance for a one-year period beginning June 1, 2018.
7. Paid $202,300 on account for the merchandise purchased in 3.
8. Collected $95,200 from customers on account.
9. Paid shareholders a cash dividend of $7,000.
10. Recorded depreciation expense of $2,275 for the month on the furniture and fixtures.
11. Recorded the amount of prepaid insurance that expired for the month.
Answer:
1. Dr Cash 700,000
Cr Common Stock 700,000
2. Dr Furnitures and fixtures 113,750
Cr Cash 45,500
Notes Payable 68,250
3. Dr Inventory 280,000
Cr Accounts Payable 280,000
4. Dr Accounts Receivable 476,000
Cr Sales Revenue 476,000
Dr Cost Of Goods Sold 238,000
Cr Inventory 238,000
5. Dr Rent Expense 6,500
Cr Cash 6,500
6. Dr Prepaid Insurace 3,360
Cr Cash 3,360
7. Dr Accounts Payable 202,300
Cr Cash 202,300
8. Dr Cash 95,200
Cr Accounts Receivable 95,200
9. Dr Dividends 7,000
Cr Cash 7,000
10. Dr Depreciation Expense 2,275
Cr Accumulated Depreciation 2,275
11. Dr Insurance Expense 280
Cr Prepaid Insurance 280
Explanation:
1. Based on the information given we were told that the company Issued 140,000 shares of common stock in exchange for the amount of $700,000 cash which means that the Journal entry will be recorded as:
Dr Cash 700,000
Cr Common Stock 700,000
2. Based on the information given we were told that the company Purchased furniture and fixtures at the amount of $113,750 in which the
amount of $45,500 was paid in cash and a note which means that the Journal entry will be:
Dr Furnitures and fixtures 113,750
Cr Cash 45,500
Notes Payable 68,250
(113,750-45,500)
3. Based on the information given we were told that the company Purchased inventory on account at the amount of $280,000 which means that the Journal entry will be:
Dr Inventory 280,000
Cr Accounts Payable 280,000
4. Based on the information given we were told that the Credit sales for the month was the amount of $476,000 while the cost of the goods sold was the amount of $238,000 which means that the Journal entry will be:
Dr Accounts Receivable 476,000
Cr Sales Revenue 476,000
Dr Cost Of Goods Sold 238,000
Cr Inventory 238,000
5. Based on the information given we were told that they Paid the amount of $6,500 for rent which means that the Journal entry will be:
Dr Rent Expense 6,500
Cr Cash 6,500
6. Based on the information given we were told that they paid the amount of $3,360 to an insurance company for fire and liability insurance which means that the Journal entry will be:
Dr Prepaid Insurace 3,360
Cr Cash 3,360
7. Based on the information given we were told that they paid the amount of $202,300 on account for the merchandise that was purchased in 3 which means that the Journal entry will be:
Dr Accounts Payable 202,300
Cr Cash 202,300
8. Based on the information given we were told that the amount of 95,200 was Collected from customers on account which means that the Journal entry will be:
Dr Cash 95,200
Cr Accounts Receivable 95,200
9. Based on the information given we were told that they paid shareholders a cash dividend of the amount of $7,000 which means that the Journal entry will be:
Dr Dividends 7,000
Cr Cash 7,000
10. Based on the information given we were told that they Recorded depreciation expense of the amount of $2,275 for the month on the furniture and fixtures which means that the Journal entry will be:
Dr Depreciation Expense 2,275
Cr Accumulated Depreciation 2,275
11. Based on the information given we were told that they recorded the amount of prepaid insurance that expired for the month which means that the Journal entry will be:
Dr Insurance Expense 280
(3,360/12)
Cr Prepaid Insurance 280
50 points! marking brainliest
Answer:
i cant see it it very blurey
Explanation:
Answer:
ok
Explanation:
Cost of Direct Materials Used in Production for a Manufacturing Company
Rextacular Manufacturing Company reported the following materials data for the month ending June 30, 2016:
Materials purchased $828,000
Materials inventory, June 1 279,000
Materials inventory, June 30 252,000
Determine the cost of direct materials used in production by Rextacular during the month ended June 30, 2016.
Answer:
$855,000
Explanation:
The Raw Materials T - Account can be used to determine the cost of direct materials used in production using the missing balance technique as follows :
Raw Materials T - Account
Debit :
Beginning Balance $279,000
Purchases $828,000
Total $1,107,000
Credit :
Ending Balance $252,000
Transferred to Production (Balancing figure) $855,000
Total $1,107,000
) What is the probability that the web site has between 3 million and 4 million visitors in a single day? If needed, round your answer to four decimal digits
Answer:
4.44 million visitors per day and a standard deviation of 740,000 visitors per day.
Explanation:
Because people uses the internet every single day
Assume that you are a management consultant called in to analyse the turnover problem. You are told that pay and benefits are fixed and cannot be substantially altered. It is clear that whatever you recommend must not bring productivity down. What would you recommend to management?
Answer:
oh its ibo shack
Explanation:
sonar
The first step in developing a market strategy is
Answer:
I would say for like a commercial, I would try to make whoever's watching it be like ''Oooh, I need that!''
Answer:
Set your marketing goals.
Explanation:
Suppose the following table displays the production levels of capital goods and consumption goods of the towns of Broseley and Ironbridge.
Ironbridge Capital Goods Consumption Goods Broseley
32 40 40 80
Using the table, select one or more phrases to complete the statement.
Ironbridge has___________
a.an absolute advantage in capital goods.
b. an absolute advantage in consumption goods.
c. a comparative advantage in consumption goods.
d. a comparative advantage in capital goods.
Answer:
d. a comparative advantage in capital goods.
Explanation:
I'm not sure how these numbers should go, but I think it should be:
Capital Goods Consumption Goods
Ironbridge 32 40
Broseley 40 80
Ironbridge's opportunity cost to produce 1 capital good = 40 / 32 = 1.25 consumption goods
Ironbridge's opportunity cost to produce 1 consumption good = 32 / 40 = 0.8 capital goods
Broseley's opportunity cost to produce 1 capital good = 80 / 40 = 2 consumption goods
Broseley's opportunity cost to produce 1 consumption good = 40 / 80 = 0.5 capital goods
Ironbridge has a comparative advantage int he production of capital goods (lower opportunity cost) while Broseley has a comparative advantage in the production of consumption goods.
Opportunity costs refers tot he extra costs or benefits lost resulting from choosing one activity or investment over another alternative. In this case,, if Ironbridge wants to produce 1 capital good, it will have to forego 1.25 consumption goods.
Consider the following events: a. A fruitworm infestation ruins a large number of apple orchards in the state of Washington. This event would cause a shift of the supply curve in the market for apples. b. Demand for apples goes down, causing the price to fall. This event would cause a movement along the supply curve. Considering the events described above, which of the following statements is true
Answer:
Both statements are true
Explanation:
Due to the worm infestation, there would be a fall in supply of apples, this would lead to a shift of the supply curve to the left
a fall in price in apples, would lead to a movement down along the supply curve.
Only a change in price of a good leads to a movement along the supply curve for the good, other factors lead to a shift of the supply curve
Why aren’t fluctuations in the stock market
necessarily indicative of how the economy’s doing?
Answer:
Because right now the government, especially in the United States, is pumping money into big companies to keep them afloat. It affects the market positively when in reality it isn't doing anything but keeping that company specifically afloat.
Please create ERDs for the following two examples and have them ready to upload. Please show cardinality for each one:
A small veterinary clinic wants to create a database for its operations. It needs to track: animals, their owners, the visits to the clinic and which vet they see on each visit. An animal can have just one owner, but an owner can have one or more animals. An animal can have lots of visits, but during each visit just one animal is seen/treated. A vet can have one or more visits with animals, but during a visit each animal sees/or is treated by just one vet.
Joe runs a small car vehicle service company. Up to now, he has been keeping track of all his customer data on paper. He now needs a database. He needs to be able to track: the car that was brought in (the VIN is the primary key), who is the current owner of the car, each time the car was serviced and which mechanic preformed the service. A car can have just one owner, but an owner can have multiple cars. Each car can have multiple service visits, but during each service just one car is worked on. A mechanic can perform multiple services, but during each service just one mechanic is working on the car.
Answer:
idk why is it so lonmg
Explanation:s
ssss
In these case, the Veterinarian Clinic the Animal Description is the first priority in terms of Owner and Veterinarian, In terms of animal the first priority is Owner.
What do you mean by Veterinarian Clinic?A structure or portion of a building that houses a veterinary practice and amenities for the care of household animals and birds, including medical treatment, inspection, surgery, diagnostics, cleaning, and general health care.
Therefore, the following conditions of the case study:
1. Veterinarian Clinic:
Animal:
OwnerVeterinarian VisitedDay of VisitTime SlotAnimal DescriptionOwner:
Animal DescriptionVeterinarian VisitedDay of VisitTime SlotVeterinarian:
Animals DescriptionOwner NameDay treatedTime Slot.2. Vehicle service shop:
Car:
Car OwnerMechanic ServicedDay of visitedDelivery timeCar DescriptionOwner:
Car DescriptionMechanic ServicedDay VisitedDelivery timeMechanic Service:
Car DescriptionCar OwnerDay visitedDelivery timeTo know more about the Veterinarian Clinic, visit:
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Golden Eagle Company prepares monthly financial statements for its bank. The November 30 adjusted trial balance includes the following account information:
30-Nov 31-Dec
Debit Credit Debit Credit
Supplies $2,000 $3,500
Prepaid Insurance $8,000 $6,000
Salaries payable $11,000 $16,000
Unearned revenue $3,000 $1,500
The following information is known for the month of December:
1. Purchases of supplies during December total $2,600.
2. Supplies on hand at the end of December equal $2,550.
3. No insurance payments are made in December.
4. Insurance cost is $1,050 per month.
5. November salaries payable of $9,100 were paid to employees in December.
6. Additional salaries for December owed at the end of the year are $14,100.
7. On November 1, a tenant paid Golden Eagle $1,650 in advance rent for the period November through January, and Deferred Revenue was credited for the entire amount.
Required:
Show the adjusting entries that were made for supplies, prepaid insurance, salaries payable, and unearned revenue on December 31.
Answer:
GOLDEN EAGLE COMPANY
Adjusting entries that were made for supplies, prepaid insurance, salaries payable, and unearned revenue on December 31.
Debit Supplies Expense $2,050
Credit Supplies $2,050
Debit Insurance Expense $1,050
Credit Prepaid Insurance $1,050
Debit Salaries Expense $14,100
Credit Salaries Payable $14,100
Debit Unearned Revenue $1,500
Credit Rent Revenue $1,500
Explanation:
a) Data and Calculations:
Golden Eagle Company
November 30 adjusted trial balance
30-Nov 31-Dec
Debit Credit Debit Credit
Supplies $2,000 $2,550
Prepaid Insurance $8,000 $6,950
Salaries payable $11,000 $16,000
Unearned revenue $3,000 $1,500
Supplies:
Nov. 30 balance $2,000
Purchase 2,600
Supplies expense 2,050
Balance $2,550
Prepaid Insurance:
Nov. 30 balance $8,000
Insurance exp. 1,050
Dec. 31 balance $6,950
Salaries Payable:
Nov. 30 balance $11,000
Salaries expense 14,100
Cash paid 9,100
Dec. 31 balance 16,000
Unearned Revenue:
Nov. 30 balance $3,000
Rent Revenue $1,500
Dec. 31 balance 1,500
Explain why two employees at a company, earning the same gross pay, might have different net pays.
Answer:
see below
Explanation:
Two employees with the same gross pay will have different net pay because of differences in deductions. Net pay is the amount that reflects in the employee's bank account after all deductions. Involuntary deductions are mandatory and comprise statutory deductions such as social security, medicare, taxes, or others prescribed by the state or the courts. To a large extent, employees with similar gross pay will have the same statutory deductions.
Voluntary deductions are employee-initiated. They include mortgages, retirement plans, medical, life assurance, dental, and general insurance. These deductions are not uniform. Each employee will have a different amount deducted depending on their preferences. Voluntary deductions contribute significantly to two employees with the same gross pay to have different net pay.
In partnership with American Express, Porter Cable requests that all employees at the rank of supervisor and above apply for a corporate credit card to be used for pay for travel, training and similar expenses. Ima Krimnel, the manager of the distribution center, was issued a corporate card and used it to take her husband to Hawaii for their 20th wedding anniversary. If Krimnel does not pay the charges, is Porter Cable liable? Why or why not?
Answer:
Yes, Porter cable is liable
Explanation:
On the occasion of the 20th wedding anniversary, a corporate card was issued to distribution center manager Ima Krimmel Yes, Porter Cable will be liable if Ima krimnel agrees to convert their employees into cognizants if the charges are not paid. They will be liable if American Express requests a contingency claim.The new iPhone 11 is released.
What happens to the demand for
iPhone 11 cases?
Answer:
it goes up!
Explanation:
Answer:
it gets higher
Explanation:
11 True or False: Alcohol has to be broken down by the digestive system. True OFalse
Answer:
False.
Explanation:
Alcohol is not digested like other foods. Once alcohol is swallowed, it travels down the esophagus into the stomach and the small intestine. It avoids the normal digestive process and goes right into the bloodstream.
Alcohol has to be broken down by the digestive system is a "false" statement.
Alcohol and Digestive systemWhat is alcohol?A molecule that can be found in alcoholic beverages like beer, wine, and liquor.Additionally, it can be discovered in several medications, mouthwashes, home goods, and essential oils (scented liquid taken from certain plants). It is produced through the chemical process of fermentation, which makes use of yeast and sugar.What is Digestive system?The bodily components that take in food and liquids and transform them into elements the body can use for -
cellular growth, energy production, tissue repair.Role of digestive system in digesting alcohol:Alcohol is not digested by digestive system as it is a liquid component.In contrast to other nutrients, alcohol is quickly absorbed in the small intestine and enters the bloodstream immediately via the stomach lining.Although other bodily cells can also metabolise alcohol, the liver is where alcohol metabolism mostly takes place.To know more about function of small intestine, here
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Read the following scenario and answer the question in 5-10 sentences. You are an experienced small business owner who would like to become a franchisee of Quick Burger, a nationwide franchise of fast food restaurants. There are some Quick Burger restaurants in your area, but not so many that another franchise would be unprofitable. Before joining the franchise, you want to make sure that the essential terms are clear to both parties. Discuss potential issues you would need to resolve before entering into a franchise contract with Quick Burger.
Answer:
Following are the solution to this question:
Explanation:
There are many multiple problems, which need to be resolve until the lease consensus is made. Its first problem was its clarity about how geographic the various branches of the same chain operate and cause disputes. Its second problem was its variety, language, or way of marketing for the franchise as current rapid can hurt one another's consumers or harm the product overall. Its third problem applies to regional information sharing with both the franchise. Unless the centralized administrative center or even the consumers decide it. In the current franchise owner will be damaged when it does not consider this into account. The fourth problem is the sharing with many other franchise owners of business information or information with my existing consumer base. It ought not to happen. Its fifth problem was a help to promote, run, report as well as other franchise relevant individuals over a certain time. Before entering the licensing deal, it ought to be obvious.
Its other issues must be considered, of addition, until entering it into a contract, as concerns taxes, profit-sharing, the number of calls being made on even a regular basis, handling unfair commercial practices or possession of misconduct at such a store, as well as the legal support which the expand and contract.
Mahaney owns Headed West, a shop selling pipes and other smoking accessories. He hired artists to showed musicians such as Jimi Hendrix, Jerry Garcia, and others. The city of Englewood cited Mahaney for three sign code violations:______.
(1) failing to obtain a permit; (2) failing to obtain city manager approval before the murals were painted; and (3) exceeding the maximum sign area allowed.
Mahaney brought an action for relief, alleging that the city ordinances violate the First Amendment. The district court granted summary judgment in favor of the city. Mahaney appealed. Do you think he has a case? Why?
Answer:
Actually Mahaney won the appeal because the Colorado Appeals Court determined that the city's ordinance did actually violate Mahaney's first amendment rights.
The court based its decision in the fact that the city's ordinance acts like a prior restraint to freedom of speech. According to the city ordinance, the city manager had the right to approve or disapprove murals. The city manager could freely decide which murals were appropriate and which were not. The court established that the city can impose restrictions to the size of signs, or some other regulations that apply to everyone and can be met by everyone.
In this specific case, the third violation regarding the maximum sign area could apply, but the other two regarding the prior permit or the city manager's approval do not hold.
A dentist shares an office building with a radio station. The electrical current from the dentist's drill causes static in the radio broadcast, causing the radio station to lose $10,000 in profits. The radio station could put up a shield at a cost of $30,000 or the dentist could buy a new drill that causes less interference for $6,000. Either would restore the radio station's lost profits. Would it be economically efficient for the dentist to buy and put up a shield? Why or why not? By how much would total surplus change?
a. Would it be economically efficient for the radio station to buy and put up a shield? Why or why not? By how much would total surplus change?
c. Would it be economically efficient for the dentist to buy a new drill? Why or why not? By how much would total surplus change?
d. Would it be efficient for the radio station to buy the dentist a new drill? Why or why not? By how much would total surplus change?
Answer:
a. Would it be economically efficient for the dentist to buy and put up a shield? Why or why not? By how much would total surplus change?
No, it is not economically efficient for the dentist to buy the shield.
b. Would it be economically efficient for the radio station to buy and put up a shield? Why or why not? By how much would total surplus change?
No, it is not economically efficient for the radio to buy the shield.
c. Would it be economically efficient for the dentist to buy a new drill? Why or why not? By how much would total surplus change?
No, it is not economically efficient for the dentist to buy the drill.
d. Would it be efficient for the radio station to buy the dentist a new drill? Why or why not? By how much would total surplus change?
Yes, it is economically efficient for the radio to buy the dentist a new drill. The Coase Theorem is an economic theory that states that economic conflicts must be solved regardless of who had the initial rights of whatever is on dispute. In this case, the dentist is causing harm to the radio, but he is doing OK. So the radio has a problem, not the dentist. The radio needs to solve its problem, so they should buy the dentist a new drill.
The economic surplus = $10,000 - $6,000 = $4,000, that means that the radio will be $4,000 better.
What is the difference between pure competition and perfect competition in market structure?
provides the benchmark that can be use to evaluate markets while
Perfect competitionis a form of market in which there are a large number of buyers and sellers competing with each other in the purchase and sale of goods, respectively and no individual buyer or seller has any influence over the price.
hope this help!
Nagle Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed out to cost of goods sold at the end of the month. In October the company completed job O43G that consisted of 15,000 units of one of the company's standard products. No other jobs were in process during the month. The job cost sheet for job O43G shows that the total cost for the job was $836,250. During the month, the actual manufacturing overhead cost incurred was $204,880 and the manufacturing overhead cost applied to job O43G was $221,600. Also during the month, 9,000 completed units from job O43G were sold. No other products were sold. The cost of goods sold that would appear on the income statement for October is closest to:
A. $819,530
B. $836,250
C. $518,470
D. $485,030
Answer:
D. $485,030
Explanation:
Total manufacturing cost for the job = $836,250
Total number of units produced 15,000
Unit product cost $55.75
Manufacturing overhead cost applied
$221,600
Actual manufacturing overhead cost $204,880
Over applied overhead $16,720
The direct method of determining cost of goods sold
Unadjusted cost of goods sold
(9,000 units × $55.75 per unit)
$501,750
Less over applied overhead
($16,720)
Cost of goods sold $485,030
The same process that applies to everyday communication applies to communication in the workplace. Understanding the steps in this process can help you craft more meaningful and effective messages.
Which parts of the communication process are described in the following scenario?
An instant message pops up on Kate's computer screen. Kate clicks the "accept" button and begins to read the message.
When Kate understands the meaning of the instant message, Kate is engaged in .
Kate sends an instant message to the sender so that he or she knows that the message was received and understood. Kate is engaged in .
For the communication process to be successful, the receiver must understand the information sent by the sender. Communication barriers, however, can complicate the process. Familiarizing yourself with common obstacles will make you better equipped to avoid them.
Consider this situation, and answer the questions that follow.
Your team is preparing for the next round of bids on a new collection of sculptures. "As you can see, sales are flat in the Western region," the presenter says. "We need to negotiate a good rate to offset our Western losses."
You were well prepared for the meeting, but the minor car accident you had in the parking lot yesterday has you worried. You check your smartphone, reading the insurance adjustor’s report. One of your colleagues says, "We’ll take care of that," and looks at you. "Right?" she asks. You don’t know how to respond because you’re not sure what she’s referring to.
What communication barrier is described in this situation?
Differing frames of reference
Distractions
Bypassing
How might you overcome this communication barrier in the future?
Focus on your smartphone.
Turn off your smartphone.
Leave the room to access your smartphone.
Unclear question. Below are the questions deduced;
When Kate understands the meaning of the instant message, Kate is engaged in____.
Kate sends an instant message to the sender so that he or she knows that the message was received and understood. Kate is engaged____in .
Consider this situation, and answer the questions that follow.
Your team is preparing for the next round of bids on a new collection of sculptures. "As you can see, sales are flat in the Western region," the presenter says. "We need to negotiate a good rate to offset our Western losses."
You were well prepared for the meeting, but the minor car accident you had in the parking lot yesterday has you worried. You check your smartphone, reading the insurance adjustor’s report. One of your colleagues says, "We’ll take care of that," and looks at you. "Right?" she asks. You don’t know how to respond because you’re not sure what she’s referring to.
What communication barrier is described in this situation?
Differing frames of referenceDistractionsBypassingHow might you overcome this communication barrier in the future?
Focus on your smartphone.Turn off your smartphoneLeave the room to access your smartphoneExplanation:
When Kate understands the meaning of the instant message, Kate is engaged in communication because she understands what was been communicated.
Distraction is the communication barrier been described in this situation because we could notice that the subject became distracted checking his smartphone, reading the insurance adjustor’s report; which ultimately became a barrier to his colleague's communication.
Turning off one's smartphone might help to overcome this communication barrier in any future meeting; this will allow for better concentration.
Rajiv and Simone Redondo live in Swarthmore, PA. Simone's father, Yakov, lives in Sweden.
For each of the following transactions that occur in their lives, identify whether it is included in the calculation of U.S. GDP as part of consumption (C), investment (I), government purchases (G), exports (X), or imports (M). Check all that apply.
a. The state of Pennsylvania repaves highway PA 320, which goes through the center of Swarthmore.
b. Simone gets a new refrigerator made in the United States.
c. Simone's father in Sweden orders a bottle of Vermont maple syrup from the producer's website.
d. Rajiv's employer upgrades all of its computer systems using U.S.-made parts.
d. Rajiv buys a sweater made in Guatemala.
Answer:
a. The state of Pennsylvania repaves highway PA 320, which goes through the center of Swarthmore. - Government Purchases (G).
The Government purchases/ expenditure portion of GDP includes the expenses by Government on the economy. This expenditure by the Pennsylvania Government will therefore come under here.
b. Simone gets a new refrigerator made in the United States. - Consumption (C).
Consumption accounts for spending by households and individuals in the economy. Simone lives in the US and buys goods in the US so this is Consumption.
c. Simone's father in Sweden orders a bottle of Vermont maple syrup from the producer's website. - Exports (X)
Exports are goods made in a country which are then sold to consumers outside the country. Simone's father is in Sweden so buying an American product is an export for the United States.
d. Rajiv's employer upgrades all of its computer systems using U.S.-made parts. - Investment (I).
Investment refers to spending by private interests that are aimed to improve capital goods in the economy. Spending on upgrading computer systems therefore falls here.
e. Rajiv buys a sweater made in Guatemala. - Imports (M)
When a person buys a good that is made outside the country, this is an import.
The following information was reported in the December 31, 2017, financial statements of National Airways, Inc. (listed alphabetically, amounts in millions).
Accounts Payable $4,650
Accounts Receivable 580
Aircraft Fuel Expense 8,700
Cash 2,970
Common Stock 1,220
Dividends 20
Equipment 14,370
Income Tax Expense 260
Interest Expense 130
Landing Fees Expense 3,100
Notes Payable 6,950
Repairs and Maintenance Expense 1,200
Retained Earnings (as of December 31, 2017) 5,780
Salaries and Wages Expense 3,280
Supplies 680
Ticket Revenues 17,100
Required:
Prepare an income statement for the year ended December 31, 2017.
Answer:
National Airways, Inc.
(amounts in millions)
NATIONAL AIRWAYS, INC.
Income Statement for the year ended December 31, 2017:
Ticket Revenues $17,100
Less Expenses:
Aircraft Fuel Expense 8,700
Landing Fees Expense 3,100
Repairs & Maintenance Expense 1,200
Salaries and Wages Expense 3,280
Interest Expense 130 16,410
Income before tax $690
Income Tax Expense 260
Net Income $430
Explanation:
a) Data:
National Airways, Inc.
(amounts in millions)
Cash $2,970
Accounts Receivable 580
Supplies 680
Equipment 14,370
Dividends 20
Aircraft Fuel Expense 8,700
Landing Fees Expense 3,100
Repairs & Maintenance Expense 1,200
Salaries and Wages Expense 3,280
Interest Expense 130
Income Tax Expense 260
Ticket Revenues $17,100
Accounts Payable 4,650
Notes Payable 6,950
Common Stock 1,220
Retained Earnings (as of December 31, 2017) 5,780
b) The National Airways' income statement shows the revenue generated by the organization and the incidental expenses that were incurred in generating the revenue and running the organization. After deducting the expenses from the revenue, the resulting figure is called the net income or loss.
Dowell Company produces a single product. Its income statements under absorption costing for its first two years of operation follow.
2016 2017
Sales ($46 per unit) $920,000 $1,840,000
Cost of goods sold ($31 per unit) 620,000 1,240,000
Gross margin 300,000 600,000
Selling and administrative expenses 290,000 340,000
Net income $10,000 $260,000
Additional Information:
1. Sales and production data for these first two years follow.
2016 2017
Units produced 30,000 30,000
Units sold 20,000 40,000
Variable cost per unit and total fixed costs are unchanged during 2016 and 2017. The company's $31 per unit product cost consists of the following.
Direct materials $5
Direct labor 9
Variable overhead 7
Fixed overhead ($300,000/30,000 units) 10
Total product cost per unit $31
Selling and administrative expenses consist of the following.
2016 2017
Variable selling and administrative expenses ($2.50 per unit) $50,000 $100,000
Fixed selling and administrative expenses 240,000 240,000
Total selling and administrative expenses $287,000 $322,000
Required:
What are the differences between the absorption costing income and the variable costing income for these two years?
Answer:
the income statement using the variable costing method would be:
2016 2017
Sales revenue $920,000 $1,840,000
Variable costs:
Direct materials $100,000 $200,000Direct labor $180,000 $360,000Overhead $140,000 $280,000S&A $50,000 $100,000Contribution margin $450,000 $900,000
Fixed costs:
Overhead $300,000 $300,000S&A $240,000 $240,000Operating income ($90,000) $360,000
the differences are:
Under absorption costing, the ending inventory carries $100,000 of fixed overhead, so the 2016 operating income = ($90,000) + $100,000 = $10,000. While the 2017 operating income = $360,000 - $100,000 = $260,000.
The problem with variable costing method is that it underestimates the value of ending inventory. In this case, ending inventory will be worth only $210,000 (direct materials + direct labor + variable overhead) instead of $310,000 (including allocation of fixed costs incurred during 2016).
The following events apply to Lewis and Harper, a public accounting firm, for the Year 1 accounting period:
a. Performed $70,000 of services for clients on account.
b. Performed $40,000 of services for cash.
c. Incurred $36,000 of other operating expenses on account.
d. Paid $10,000 cash to an employee for salary.
e. Collected $47,000 cash from accounts receivable.
f. Paid $16,000 cash on accounts payable.
g. Paid a $8,000 cash dividend to the stockholders.
h. Accrued salaries were $2,000 at the end of Year 1.
Required
Show the effects of the events on the financial statements using a horizontal statements model.
Answer:
Assets = Liabilities + Stockholders' Equity => $40,000 = $22,000 + $18,000
Net income = $26,000
Net cash change for the year = $17,000
Explanation:
Note: See the attached excel file for the horizontal financial statements.
In the attached excel file, OA denotes operating activity, FA denotes financing activity, and NC denotes net change in cash
The following totals can be obtained from the attached excel file
Assets = $17,000 + $23,000 = $40,000
Liabilities = – $16,000 + $36,000 + $2,000 = $22,000
Stockholders' Equity = $18,000
Therefore, the accounting equation holds as follows:
Assets = Liabilities + Stockholders' Equity => $40,000 = $22,000 + $18,000
In addition, the following totals can be obtained from the attached excel file:
Revenue = $74,000
Expenses = $48,000
Net income = $26,000
Net cash change for the year = $17,000
Use EMBG's adjusted trial balance to EMBG's balance sheet for the current year-end
EMBG CORPORATION
Adjusted Trial Balance
For Year Ending December 31, 2016
Debit Credit
Cash 44,000
Accounts receivable 28,000
Equipment 376,000
Accumulated depreciation 72,000
Notes payable 60,000
Common stock 130,000
Retained earnings 62,000
Service fees earned 326,000
Rent expense 44,000
Salaries expense 116,000
Depreciation expense 42,000
Totals $650,000 $650,000
Answer:
EMBG Corporation
Balance Sheet
For year ending December 31, 2016
Assets: $376,000
Cash $44,000 Accounts receivable $28,000 Equipment, net $304,000Liabilities
Notes payable $60,000Equity
Common stock $130,000 Retained earnings $186,000Total liabilities + equity $376,000
net income = $326,000 - $44,000 - $116,000 - $42,000 = $124,000
retained earnings = previous balance + net income = $62,000 + $124,000 = $186,000
Computing and Assessing Plant Asset Impairment On July 1, Arcola Company purchases equipment for $330,000. The equipment has an estimated useful life of 10 years and expected salvage value of $40,000. The company uses straight-line depreciation. Four years later, economic factors cause the fair value of the equipment to decline to $160,000. On this date, Arcola examines the equipment for impairment and estimates $185,000 in undiscounted expected cash inflows from this equipment.
(a) Compute the annual depreciation expense relating to this equipment. $ 29,000
(b) Compute the equipment's net book value at the end of the fourth year. 214,000 v
(c) Apply the test of impairment to this equipment as of the end of the fourth year. Is the equipment impaired?
i. Yes, because the fair value is less than the net book value.
ii. Yes, because the net book value is greater than the salvage value.
iii. Yes, because the undiscounted expected cash flows are less than net book value.
iv. No, because the net book value minus the salvage value is greater than the undiscounted expected cash flows.
v. No, because the net book value minus the salvage value is less than the undiscounted expected cash flows
(d) If the equipment is impaired at the end of the fourth year, compute the impairment loss. (If the equipment is not impaired, enter o.)
Answer:
(a) Compute the annual depreciation expense relating to this equipment.
annual depreciation expense = ($330,000 - $40,000) / 10 years = $29,000
(b) Compute the equipment's net book value at the end of the fourth year.
book value at end of yer 4 = $330,000 - (4 x $29,000) = $214,000
(c) Apply the test of impairment to this equipment as of the end of the fourth year. Is the equipment impaired?
ii. Yes, because the net book value is greater than the salvage value.
(d) If the equipment is impaired at the end of the fourth year, compute the impairment loss.
fair value = $160,000
net book value = cost - {[(cost - salvage value) / estimated useful life] x period covered}
net book value = $330,000 - {[($330,000 - $40,000) / 10] x 4}
net book value = $330,000 - {[$290,00 / 10] x 4} = $330,000 - ($29,000 x 4) = $330,000 - $116,000 = $214,000
impairment loss = $214,000 - $160,000 = $54,000
