Answer:
Once a Semester
Explanation:
Advisors can help you decide if you want to minor in something, and what the requirements are. They can ensure you're odds of graduating in four years is on track, or give you special permissions to take certain classes.
In Q1 2018, CNA Companies reports the following transactions: Capital expenditures of $15 million Loss on sale of equipment of $6 million Debt principal repayment of $8 million Preferred dividend of $2 million Common dividend of $3 million Share buyback of $4 million Ignoring the effect of taxes, what is the impact of these transactions on retained earnings
Answer:
-$11 million
Explanation:
According to the scenario, computation of the given data are as follow:-
We can calculate the impact of transactions on retained earnings by using following formula:-
Impact of transactions on retained earnings = - common dividend - preferred dividend - loss on sale of equipment
= -$3 million - $2 million - $6 million
= - $11 million
All three items should be deducted as it has a negative impact on the retained earnings
The FI Corporation’s dividends per share are expected to grow indefinitely by 5% per year. a. If this year’s year-end dividend is $8 and the required rate of return is 10% per year, what must the current stock price be according to the DDM? b. If the expected earnings per share are $12, what is the value of the ROE on the firm’s investment opportunities? c. How much is the market paying per share for growth opportunities?
Answer and Explanation:
The computation is shown below:
a. The current stock price is
As we know that
Current stock price = (Dividend) ÷ (Required rate of return - growth rate)
= ($8) ÷ ( 10% - 5%)
= $160
b. Now the value of the ROE on the firm’s investment opportunities is
Given that
Dividend = $8
And,
The payout ratio = Dividend ÷ Earning per share
= $8 ÷ $12
= 0.666666666666667
And, retention ratio (b) is
= 1- 0.666666666666667
= 0.333333333333333
In addition to it
indefinite growth rate (g) = 5%
So, the ROE is
= Growth rate ÷ retention ratio
= 0.15 ÷ 0.3333
= 15%
c. And, the market paying per share is
PVGO = Price - Earning per share ÷ required rate of return
where,
PVGO = Present Value of Growth Opportunity
So, the market paying per share is
= $160 - $12 ÷ 10%
= $160 - $120
= $40
For the year ended December 31, 2016, Norstar Industries reported net income of $655,000. At January 1, 2016, the company had 900,000 common shares outstanding. The following changes in the number of shares occurred during 2016: Apr. 30 Sold 60,000 shares in a public offering. May 24 Declared and distributed a 5% stock dividend. June 1 Issued 72,000 shares as part of the consideration for the purchase of assets from a subsidiary. Required: Compute Norstar's earnings per share for the year ended December 31, 2016.
Answer:
1.272 per share
Explanation:
The computation of earnings per share is shown below:-
Weighted Average number of Common shares outstanding = outstanding common shares ÷ Net income
= 900,000 ÷ $707,810
= 1.272 per share
Where,
Net Income = Preferred Dividends ÷ Weighted Average number of Common shares outstanding
= $655,000 ÷ (1 + 0.05) + ( 60,000 × 8 months ÷ 12 months) × 1.05 + (72,000 × 7 months ÷ 12 months)
= $623,810 + 40,000 × 1.05 + 42,000
= $623,810 + 42,000 + 42,000
= 707,810
Sheffield Co. is building a new hockey arena at a cost of $2,630,000. It received a downpayment of $520,000 from local businesses to support the project, and now needs to borrow $2,110,000 to complete the project. It therefore decides to issue $2,110,000 of 12%, 10-year bonds. These bonds were issued on January 1, 2019, and pay interest annually on each January 1. The bonds yield 11%. Sheffield paid $50,000 in bond issue costs related to the bond sale.
Required:
(a) Prepare the journal entry to record the issuance of the bonds and the related bond issue costs incurred on January 1, 2019.
(b) Prepare a bond amortization schedule up to and including January 1, 2023, using the effective-interest method.
Answer:
Explanation:
a.
Prepare the journal entry to record the issuance of the bonds on January 1, 2019.
Accounting homework question answer, step 1, image 1
Accounting homework question answer, step 1, image 2
Step 2
b.
Prepare a bond amortization schedule up to and including January 1, 2023, using the effective-interest method.
The file attached below has the calculations
Arlington Clothing, Inc., shows the following information for its two divisions for year 1: Lake Region Coastal Region Sales revenue $ 4,200,000 $ 13,110,000 Cost of sales 2,711,300 6,555,000 Allocated corporate overhead 252,000 786,600 Other general and administration 557,900 3,759,000 Required: a. Compute divisional operating income for the two divisions. Ignore taxes.
Answer:
Lake Region Coastal region
Operating income ($) 678,800. 2,009,400.
Explanation:
Lake Region Coastal region
$'000 $'000
Sales revenue 4,200 13,110
Cost of sales (2,711) (6.555)
Gross profit 1,488.7 6,555
Allocated overhead (252) (786.6)
Other general overhead (557.9) ( 3,759)
Operating income 678.8 2,009.4
Lake Region Coastal region
Operating income 678,800. 2,009,400.
An outside supplier has offered to provide the annual requirement of 7,200 of the parts for only $13 each. The company estimates that 60% of the fixed manufacturing overhead cost above could be eliminated if the parts are purchased from the outside supplier. Assume that direct labor is an avoidable cost in this decision. Based on these data, the financial advantage (disadvantage) of purchasing the parts from the outside supplier would be:
Super corporation produces a part in the manufactures of its product. The unit cost is $21 computed as follows:
An outside supplier has offered to provide the annual requirement of 7,200 of the parts for only $13 each. The company estimates that 60% of the fixed manufacturing overhead cost above could be eliminated if the parts are purchased from the outside supplier. Assume that direct labor is an avoidable cost in this decision. Based on these data, the financial advantage (disadvantage) of purchasing the parts from the outside supplier would be:
$
Direct material 6
Direct labour 8
Variable manufacturing overhead 2
Fixed manufacturing overhead 5
Total cost 21
Answer:
Total financial advantage of buying from the supplier $43,200
Explanation:
Unit relevant variable cost of making= 6+8 +2 = 16
$
Variable cost of making ( 16× 7200) = 115,200
Variable of buying (13 ×7200) 93,600
Savings in variable cost 21,600
Savings in fixed cost (60%*72300 × 5) 21600
Total savings from buying 43,200
Total financial advantage of buying from the supplier $43,200
Gilberto Company currently manufactures 50,000 units per year of one of its crucial parts. Variable costs are $2.00 per unit, fixed costs related to making this part are $50,000 per year, and allocated fixed costs are $40,000 per year. Allocated fixed costs are unavoidable whether the company makes or buys the part. Gilberto is considering buying the part from a supplier for a quoted price of $3.20 per unit guaranteed for a three-year period. Calculate the total incremental cost of making 50,000 and buying 50,000 units. Should the company continue to manufacture the part, or should it buy the part from the outside supplier
Answer:
Net incremental cost of buying (10,000). \
Gilberto Company should produced the parts internally . Doing so would saving its $10,000 per year
Explanation:
The relevant cash flow from the accepting the offer of the outside suppliers include
Extra variable cost of buying
Savings in direct fixed manufacturing overhead
Unit variable cost of making: =$2
$
Variable cost of external purchase ($3.2× 50,000) 160,000
Variable cost of making ($2× 50,000) (100,000 )
Extra variable cost of buying (60,000 )
Savings in direct fixed cost 50,000
Net incremental cost of buying (10,000)
Accompanying a bank statement for Borden Company is a credit memo for $21,200 representing the principal ($20,000) and interest ($1,200) on a note that had been collected by the bank. The company had been notified by the bank at the time of the collection but had made no entries. Journalize the entry that should be made by the company to bring the accounting records up to date. If an amount box does not require an entry, leave it blank. Cash Notes Receivable Interest Revenue
Answer: Please refer to Explanation
Explanation:
The above transaction refers to a Note being collected by a bank on behalf of the company. This means that the company's cash balance has therefore increased leading to a journal entry of,
DR Cash $21,200
CR Note Receivables $20,000
CR Interest Revenue $1,200
(To record Note Received by Bank).
Brainliest help mee please get this correct
Answer:
it should be c
Explanation:
Maritime Sail Makers manufactures sails for sailboats. The company has the capacity to produce 37 comma 000 sails per year and is currently producing and selling 25 comma 000 sails per year. The following information relates to current production: Sales price per unit $ 185 Variable costs per unit: Manufacturing $ 60 Selling and administrative $ 20 Total fixed costs: Manufacturing $ 700 comma 000 Selling and administrative $ 250 comma 000 If a special pricing order is accepted for 5 comma 700 sails at a sales price of $ 160 per unit, fixed costs remain unchanged, and there are no variable selling and administrative costs for this order, what is the change in operating income?
Answer:
Increase in operating income = $456,000
Explanation:
According to the scenario, computation of the given data are as follow:-
Operating Income Statement
Particular Existing New order Total
Current selling 25,000 5,700 30,700
Selling price per unit $185 $160
Manufacturing variable cost per unit $60 $60
Selling and administrative variable cost per unit $20 $20
Contribution margin per unit(CMPU)= $105 $80
(sale price - variable cost)
Contribution margin $2,625,000 $456,000 $3,081,000
(sale units × CMPU)
Manufacturing fixed cost $700,000 $700,000
Selling and administrative fixed cost $250,000 $250,000
Net operating income $1,675,000 $2,131,000
So, Difference in net income are as follows:
Increase in operating income = $2,131,000 - $1,675,000
= $456,000
During 2017, Woods Company purchased 80,000 shares of Holmes Corporation common stock for $1,260,000 as an equity investment. The fair value of these shares was $1,200,000 at December 31, 2017. Woods sold all of the Holmes stock for $17 per share on December 3, 2018, incurring $56,000 in brokerage commissions.
Required:
1. Woods Company should report a realized gain on the sale of stock in 2018 of ____________.
Answer:
The multiple choices are as follows:
a.$44,000.
b.$100,000.
c.$104,000.
d.$160,000.
Option A,$44,000 is correct
Explanation:
In the year 2017,an unrealized loss of $60,000 was recorded on the investment i.e fair value at year end of $1,200,000 minus the cost of the investment of $1,260,000
In the year 2018,the total cash proceeds from sale of investment=($17*80,000)-$56,000=$1,304,000
The realized gain on sale of stock in 2018=cash proceeds-fair value-unrealized loss of $60,000=$1,304,000-$1,200,000-$60,000 =$44,000
On January 1, 2017, Culver Company issued 10-year, $2,060,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 15 shares of Culver common stock. Culverâs net income in 2017 was $291,000, and its tax rate was 40%. The company had 108,000 shares of common stock outstanding throughout 2017. None of the bonds were converted in 2017.Required:(a) Compute diluted earnings per share for 2017. (Round answer to 2 decimal places, e.g. $2.55.)(b) Compute diluted earnings per share for 2017, assuming the same facts as above, except that $1,080,000 of 6% convertible preferred stock was issued instead of the bonds. Each $100 preferred share is convertible into 5 shares of Culver common stock.
Job 397 was recently completed. The following data have been recorded on its job cost sheet. Direct materials $59,400 Direct labor-hours 1,254 DLHs Direct labor wage rate $11 per DLH Number of units completed 3,300 units The company applies manufacturing overhead on the basis of direct labor-hours. The predetermined overhead rate is $37 per direct labor-hour. Required: What's the unit product cost that would appear on the job cost sheet for this job
Answer:
$36.24
Explanation:
The computation of unit product cost is shown below:-
Unit product cost = Direct material + Direct labor + Manufacturing overhead) ÷ Unit completed
= ($59,400 + (1254 × $11) + (1254 × $37)) ÷ 3,300
= ($59,400 + $13,794 + $46,398) ÷ 3,300
= $119,592 ÷ 3,300
= $36.24
Therefore for computing the units product cost we simply applied the above formula.
HI Corporation is considering the purchase of a machine that promises to reduce operating costs by the same amount for every year of its 5-year useful life. The machine will cost $211,980 and has no salvage value. The machine has a 14% internal rate of return. (Ignore income taxes.) Click here to view Exhibit 13B-1 and Exhibit 13B-2 to determine the appropriate discount factor(s) using the tables provided. Required: What are the annual cost savings promised by the machine? (Round your intermediate calculations and final answer to the nearest whole dollar amount.)
Answer:
Annual savings = 61,746.
Explanation:
The Net Present Value (NPV) is the difference between the present value (PV) of cash outflows and PV of cash inflow
At the internal rate of return the PC of annual cash savings will be equal to the investment cost
Initial cost = 211980
PV = annual cash savings = A× (1- (1+r)^(-n)/ r
A=? r-internal rate of return, 14%, n-number of years- 5
211980 = A (1- (1.14)^(-5)/ 0.14
211,980 = A× 3.433080969
A= 211,980/3.43308
A= 61746.28619
Annual savings = 61,746.
During April, the production department of a process operations system completed and transferred to finished goods 18,000 units that were in process at the beginning of April and 90,000 units that were started and completed in April. April's beginning inventory units were 100% complete with respect to materials and 40% complete with respect to labor. At the end of April, 30,000 additional units were in process in the production department and were 100% complete with respect to materials and 60% complete with respect to labor. The beginning inventory included materials cost of $107,000 and the production department incurred direct materials cost of $329,000 during the month. Compute the direct materials cost per equivalent unit for the department using the weighted-average method
Answer:
Cost per equivalent unit of materials = $3.16
Explanation:
Under the weighted average method of valuation, to account for completed units, it is assumed that the entire degree of work required is done in the period under consideration. So there is no separation of the completed units into opening inventory and fully worked.
Cost per equivalent unit = cost / total equivalent units
Total units completed and transferred out= 18,000 + 90000= 108,000
Items Unit Equivalent unit
Completed units 108,000 100% × 108,000 = 108,000
Closing inventory 30,000 100% × 30,000 = 30,000
Total equivalent unit of material 138,000
Cost per equivalent unit = Total cost/Total equivalent unit
= (107,000 + 329,000) /138,000 units
= $3.16
When Starbucks sells "Starbucks" T-shirts in its coffee shops or when the Chicago Cubs peddle cubs branded merchandise at Wrigley Field, why are their marketers so happy?
Answer:
Because they have produced beyond their normal sale products such as coffee for Starbucks in other words they have found a other way to make more money.
Explanation:
pls mark brainliest
Aquatic Equipment Corporation decided to switch from the LIFO method of costing inventories to the FIFO method at the beginning of 2021. The inventory as reported at the end of 2020 using LIFO would have been $59,000 higher using FIFO. Retained earnings at the end of 2020 was reported as $770,000 (reflecting the LIFO method). The tax rate is 35%. Required: 1. Calculate the balance in retained earnings at the time of the change (beginning of 2021) as it would have been reported if FIFO had been used in prior years. 2. Prepare the journal entry at the beginning of 2021 to record the change in accounting principle.
Answer:
1. The balance in retained earnings at the time of the change is $808,350
2. The journal entry at the beginning of 2021 to record the change in accounting principle woud be as follows:
Inventoty $59,000
Retained Earnings $38,350
Tax Payable $20,650
Explanation:
1. In order to calculate the balance in retained earnings at the time of the change (beginning of 2021) as it would have been reported if FIFO had been used in prior years we would have to make the following calculation:
balance in retained earnings at the time of the change=Begining Retained earnings of 2021+Adjusted net income
Adjusted net income=Ending inventory higher by amount×(1-tax rate)
Adjusted net income=$59,000×(1-0.35)
Adjusted net income=$38,350
balance in retained earnings at the time of the change=$770,000+$38,350
balance in retained earnings at the time of the change=$808,350
2. The journal entry at the beginning of 2021 to record the change in accounting principle woud be as follows:
Inventoty $59,000
Retained Earnings $38,350
Tax Payable $20,650= $59,000×0.35
Method A assumes simple interest over final fractional periods, while Method B assumes simple discount over final fractional periods. The annual effective rate of interest is 20%. Find the ratio of the present value of a payment to be made in 1.5 years computed under method A to that computed under Method B.
Answer:
The answer is "1.1"
Explanation:
In the case of a single Interest, the principal value is determined as follows:
[tex]\ I = Prt \\\ A = P + I\\A = P(1+rt) \\\\A = amount \\P= principle\\r = rate\\t= time[/tex]
In case of discount:
[tex]D = Mrt \\P = M - D \\P = M(1-rt)\\\\Where, D= discount \\M =\ Maturity \ value \\[/tex]
Let income amount = 100, time = 1.5 years, and rate =20 %.
Formula:
A = P(1+rt)
A =P+I
by putting vale in the above formula we get the value that is = 76.92, thus method A will give 76.92 value.
If we calculate discount then the formula is:
P = M(1-rt)
M = 100 rate and time is same as above.
[tex]P = 100(1-0.2 \times 1.5) \\P = 100 \times \frac{70}{100} \\P = 70[/tex]
Thus Method B will give the value that is 70
calculating ratio value:
[tex]ratio = \frac{\ method\ A \ value} {\ method \ B \ value}\\\\\Rightarrow ratio = \frac{76.92}{70}\\\\\Rightarrow ratio = \frac{7692}{7000}\\\\\Rightarrow ratio = 1.098 \ \ \ \ or \ \ \ \ 1.[/tex]
Beresford Inc. purchased several investments in debt securities during 2020, its first year of operations. The following information pertains to these securities. The fluctuations in their fair values are not considered permanent. Held-to-Maturity Securities: Fair Value 12/31/2020 Fair Value 12/31/2021 Amortized Cost 12/31/2020 Amortized Cost 12/31/2021 ABC Co. Bonds $ 389,000 $ 414,000 $ 381,500 $ 374,000 Trading Securities: Fair Value 12/31/2020 Fair Value 12/31/2021 Cost DEF Co. Bonds $ 59,000 $ 70,000 $ 75,400 GEH Inc. Bonds $ 61,000 $ 91,000 $ 53,000 IJK Inc. Bonds $ 58,000 $ 52,500 $ 46,900 Available-for-Sale Securities: Fair Value 12/31/2020 Fair Value 12/31/2021 Cost LMN Co. Bonds $ 153,400 $ 166,700 $ 154,000 What balance sheet amount would Beresford report for the total of its investments in bonds at 12/31/2020
Answer:
Check the explanation
Explanation:
Kindly check the attached image below to see the step by step explanation to the question above.
Current liabilities are obligations that are reasonably expected to be paid from Existing Creation of Other Current Assets Current Liabilities a. No No b. Yes Yes c. Yes No d. No Yes
Answer:
The answer is option C) Yes No
Explanation:
Current liabilities are obligations that are reasonably expected to be paid from Existing Creation of Other Current Assets and not current liabilities.
This is because, Current liabilities are short term liabilities due within a year. They include accounts payable, short term debt and overdraft. This means that payment can only be generated by current assets.
Current assets are also short term assets with a life span of on year. They include accounts receivable an cash.
Therefore, Yes, Current liabilities are obligations that are reasonably expected to be paid from Existing Creation of Other Current Assets.
And No, Current liabilities are obligations that are not expected to be paid from Existing Creation of Other Current Liabilities.
The SP Corporation makes 42,000 motors to be used in the production of its sewing machines. The average cost per motor at this level of activity is: Direct materials $ 10.10 Direct labor $ 9.10 Variable manufacturing overhead $ 3.75 Fixed manufacturing overhead $ 4.70 An outside supplier recently began producing a comparable motor that could be used in the sewing machine. The price offered to SP Corporation for this motor is $25.75. If SP Corporation decides not to make the motors, there would be no other use for the production facilities and none of the fixed manufacturing overhead cost could be avoided. Direct labor is a variable cost in this company. The annual financial advantage (disadvantage) for the company as a result of making the motors rather than buying them from the outside supplier would be:
Answer:
annual financial advantage, $837,600
Explanation:
Analysis of the Make or Buy Decision - Making
Making Costs
Direct materials $ 10.10×42,000 424,200
Direct labor $ 9.10×42,000 382,200
Variable manufacturing overhead $ 3.75×42,000 157,500
Fixed manufacturing overhead $ 4.70×42,000 197,400
Total 1,161,300
Buying Costs
Purchase Price $25.75×42,000 1,801,500
Fixed manufacturing overhead $ 4.70×42,000 197,400
Total 1,998,900
It costs $837,600 more to Buy than to make.
Hence the annual financial advantage for the company as a result of making the motors rather than buying them from the outside supplier would be $837,600.
Marquis Company estimates that annual manufacturing overhead costs will be $900,000. Estimated annual operating activity bases are direct labor cost $500,000, direct labor hours 50,000, and machine hours 100,000. Compute the predetermined overhead rate for each activity base. (Round answers to 2 decimal places, e.g. 10.50% or 10.50.) Overhead rate per direct labor cost enter percentages rounded to 2 decimal places % Overhead rate per direct labor hour $enter a dollar amount rounded to 2 decimal places Overhead rate per machine hour $enter a dollar amount rounded to 2 decimal places
Answer:
Basis Rate
Labour hour $18 per direct labour
Machine hour $9 per machine hour
Budgeted labour cost 180% of labour cost
Explanation:
Predetermined overhead absorption rate=
Estimated Overhead for the period/Estimated activity level
Labour hour basis
Estimated Overhead for the period/Estimated labour hours
= $900,000/50,000
=$18 per direct labour
Machine hour basis
Estimated Overhead for the period/Estimated machine hours
Overhead rate per machine hour = $900,000/100,000 hours
=$9 per machine hour
Direct labour cost basis
Pre-determined overhead rate = Estimated Overhead for the period/Estimated labour cost
=$900,000/($500,000)×100
=180 % of labour cost
Basis Rate
Labour hour =$18 per direct labour
Machine hour =$9 per machine hour
Budgeted labour cost 180% of labour cost
Enviro Company issues 8%, 10-year bonds with a par value of $300,000 and semiannual interest payments. On the issue date, the annual market rate for these bonds is 10%, which implies a selling price of 87 1/2. The straight-line method is used to allocate interest expense. 1. Using the implied selling price of 87 ½, what are the issuer's cash proceeds from issuance of these bonds? 2. What total amount of bond interest expense will be recognized over the life of these bonds? 3. What is the amount of bond interest expense recorded on the first interest payment date?
Answer:
1. Issuer's cash is $262,500
2. Total amount of bond interest is $277,500
3. The amount of bond interest expense is $13,875.
Explanation:
1. Issuer's cash = Face Value × Selling Price
Issuer's cash = $300,000 × 87.50%
Issuer's cash = $262,500
2. Discount on bond = $300,000 × 12.5% = $37,500
Interest on bond = $300,000 × 8% = $24,000
Period of bonds= 10 years
Total amount of bond interest = Discount on Bond + (Interest on Bond × period)
Total amount of bond interest = $37,500 + ($24,000 × 10)
Total amount of bond interest = $277,500
3. Discount on bond = $300,000 × 12.5% = $37,500
Interest on bond = $300,000 × 8% = $24,000
Period = 0.5 years
The amount of bond interest expense = (Discount of Bond ÷ 20) + Interest
The amount of bond interest expense = ($37,500 ÷ 20) + ($24,000 × 0.5)
The amount of bond interest expense = $1,875 + $12,000
The amount of bond interest expense = $13,875.
Flowrider is an indoor surfing wave company. In order to expand its customer base and bring more surfers into the pools and facilities that offer Flowrider experiences, Flowrider decides it needs to offer a short-term incentive for people to stop by and try the experience. Because the ride is usually on the more expensive side, Flowrider offers a 25% discount for anyone with a specific coupon for the next 30 days. The coupon is delivered through email, text, and a newspaper insert. What type of marketing tool did Flowrider use to entice people to try their product
Answer: C. sales promotion
Explanation:
Flowrider used coupons which are quite a popular method of Sales Promotion. Sales Promotion refers to strategies used to increase sales such as discounts and sampling.
Coupons are a type of discount as shown in the question that allow for customers to receive discounts on purchased goods if they have said coupons. As they are a discount and are meant to increase sales, they are a method of Sales Promotion.
Problem 4-6 (Algo) Income statement presentation; Discontinued operations; EPS [LO4-1, 4-3, 4-4, 4-5] Rembrandt Paint Company had the following income statement items for the year ended December 31, 2021 ($ in thousands): Sales revenue $ 24,000 Cost of goods sold $ 13,500 Interest revenue 220 Selling and administrative expense 3,100 Interest expense 420 Restructuring costs 1,400 In addition, during the year the company completed the disposal of its plastics business and incurred a loss from operations of $2.2 million and a gain on disposal of the component’s assets of $3.2 million. 600,000 shares of common stock were outstanding throughout 2021. Income tax expense has not yet been recorded. The income tax rate is 25% on all items of income (loss). Required: Prepare a multiple-step income statement for 2021, including EPS disclosures. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands except earnings per share. Round EPS answers to 2 decimal places.)
Answer and Explanation:
The preparation of the multiple-step income statement is presented below:
Rembrandt Paint Company
Income Statement
For the Year Ended December 31, 2021
Sales revenue $24,000
Less: Cost of goods sold -$13,500
Gross profit $10,500
Less:
Operating expenses
Selling and administrative -$3,100
Restructuring costs -$1,400
Operating Income $6,000
Add: Interest revenue $220
Less: Interest expense -$420
Income from Continuing operations before income tax expense and extra ordinary item $5,800
Less: Income tax expense (25%) -$1,450
Income from Continuing operations before extraordinary item $4,350
Discontinued Operations
Income from operations of discontinued components ($3,200 - $2,200) $1,000
Less: Income tax expense (25%) $250
Income from Discontinued operations $750
Income before extraordinary items $5,100
Extraordinary item $0
Net Income $5,100
Earning per share
Income from Continuing operations before extraordinary item ($4,350 ÷ 600 shares) $7.25
Income from Discontinued operations ($750 ÷ 600 shares) $1.25
Extraordinary item 0
Net Income $8.50
We simply deduct all types of expenses and added all types of incomes
Supler Corporation produces a part used in the manufacture of one of its products. The unit product cost is $25, computed as follows: Direct materials $ 8 Direct labor 8 Variable manufacturing overhead 3 Fixed manufacturing overhead 6 Unit product cost $ 25 An outside supplier has offered to provide the annual requirement of 3,800 of the parts for only $14 each. The company estimates that 50% of the fixed manufacturing overhead cost above could be eliminated if the parts are purchased from the outside supplier. Assume that direct labor is an avoidable cost in this decision. Based on these data, the financial advantage (disadvantage) of purchasing the parts from the outside supplier would be:
Answer:
financial advantage : $30,400
Explanation:
Analysis of the Make or Buy Decision
Purchase Cost (3,800×$14) (53,200)
Savings :
Fixed manufacturing overhead($6×50%×3,800) 11,400
Direct Labor ($8×3,800) 30,400
Direct materials ($8×3,800) 30,400
Variable manufacturing overhead (3×3,800) 11,400
Financial Advantage 30,400
Therefore, the financial advantage of purchasing the parts from the outside supplier would be $30,400.
Bramble Inc., which produces a single product, has prepared the following standard cost sheet for one unit of the product. Direct materials (6 pounds at $3.10 per pound) $18.60 Direct labor (4 hours at $10.00 per hour) $40.00 During the month of April, the company manufactures 190 units and incurs the following actual costs. Direct materials purchased and used (2,200 pounds) $7,260 Direct labor (770 hours) $7,623 Compute the total, price, and quantity variances for materials and labor. Total materials variance $ Materials price variance $ Materials quantity variance $ Total labor variance $ Labor price variance $ Labor quantity variance $ Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT LINK TO TEXT
Answer and Explanation:
a. The computation of the material price variance is shown below:
= Actual Quantity × (Standard Price - Actual Price)
= $7,260 × (2,200 pounds × $3.10 per pound)
= $440 unfavorable
b. The computation of the material quantity variance is shown below:
= Standard Price × (Standard Quantity - Actual Quantity)
= $3.10 × (2,200 pounds - (190 units × 6 pounds))
= $3,286 unfavorable
c. Total material variance
= Material price variance + material quantity variance
= $440 unfavorable + $3,286 unfavorable
= $3,726 unfavorable
d. The computation of the labor price variance is shown below:
= Actual Hours × (Actual price - Standard Price)
= $7,623 - (770 hours × $10)
= $77 favorable
e. The computation of the labor quantity variance is shown below:
= Standard Rate × (Actual Hours - Standard hours allowed for actual units)
= $10 × (770 hours - (190 units × 4 hours)
= $100 unfavorable
Total labor variance
= Labor rate variance + labor quantity variance
= $77 favorable + 100 unfavorable
= $23 unfavorable
Flychucker Corporation is evaluating an extra dividend versus a share repurchase. In either case $19,000 would be spent. Current earnings are $1.40 per share, and the stock currently sells for $50 per share. There are 5,000 shares outstanding. Ignore taxes and other imperfections. a. Evaluate the two alternatives in terms of the effect on the price per share of the stock and shareholder wealth per share
Answer:
Alternative I: (Extra dividend)
Price per share is $ 46.20
Shareholder wealth per share is $ 42.40
Alternative II: ( Share repurchase)
For share repurchase, the price per share and the shareholder wealth is equal to the stock price.
Explanation:
Alternative I: (Extra dividend)
Amount spent = $19,000
Outstanding shares = 5,000 shares
Stock price = $50
Price per share = Stock price - [tex]\frac{Amount spent}{Outstanding Shares}[/tex]
= $50 - [tex]\frac{19,000}{5,000}[/tex] = $50 - $3.8
= $ 46.20
Shareholder wealth per share = Price per share - [tex]\frac{Amount spent}{Outstanding Shares}[/tex]
= $46.20 - $3.8
=$ 42.40
Alternative II: ( Share repurchase)
For share repurchase, the price per share and the shareholder wealth is equal to the stock price.
A translation adjustment (or translation gain) that is a consequence of translation of a functional currency that is different from the reporting currency should be:_______.
A. Included in net income in the period in which it occurs.
B. Deferred and amortized over a period not to exceed 40 years.
C. Deferred until a subsequent year when a loss occurs and offset it against that loss.
D. Included as a separate item in the equity section of the balance sheet.
Answer:
d
Explanation:
wild guess
Minot Corporation is preparing its cash budget for August. The following information is available concerning its accounts receivable: Estimated credit sales for August $ 220,000 Actual credit sales for July $ 167,000 Estimated collections in August for credit sales in August 25 % Estimated collections in August for credit sales in July 70 % Estimated collections in August for credit sales prior to July $ 18,000 Estimated write-offs in August for uncollectible credit sales $ 8,000 Estimated provision for bad debts in August for credit sales in August $ 7,800 Required: What is the estimated amount of cash receipts from accounts receivable collections in August?
Answer:
$189,900
Explanation:
For computation of estimated amount of cash receipts from accounts receivable collections first we need to find out the credit sales in August and credit sales in July which is shown below:-
Credit sales in August = Estimated credit sales × Estimated collections in August for credit sales in August
= $220,000 × 25%
= $55,000
Credit sales in July = Actual credit sales × Estimated collections in August for credit sales in July
= $167,000 × 70%
= $116,900
Total estimated cash receipts from accounts receivable = Credit sales in August +Credit sales in July = Actual credit sales + Credit sales prior to July
= $55,000 + $116,900 + $18,000
= $189,900
