Answer:
a) $1,470 Debit –Wage Expense; $1,470 Credit –Wage Payable.
b) $4,410 Debit –Wage Expense; $1,470 Debit –Wage Payable
Explanation:
Remember, we are told each of the worker earns $210 per day. Therefore
a.To record accrued and current wages.Wages expense = 7 workers × 3 days × $210 = $4,410.
b. To record accrued wages four days Cash = 7 workers × 4 days × $210 = $5,880. For one day (7 workers × $210) = $1,470.
On March 4 of 1999, XYZ Corporation takes out a $1 million loan. The company pays the interest semiannually. The six-month interest rate is six-month LIBOR 80 basis points, with a cap at 9.25%. Assume that LIBOR is at 8.5% on March 4, 1999, and 7.75% on September 4, 1999. What is the second interest payments on the loan
Answer: $85,500
Explanation:
From the question, we are told XYZ Corporation takes out a $1 million loan and the interest on the loan is paid semiannually.
We are also told that the six-month interest rate is six-month LIBOR 80 basis points, with a cap at 9.25%. Assume that LIBOR is at 8.5% on March 4, 1999, and 7.75% on September 4, 1999.
The second interest payments on the loan will be:
The interest rate will be:
Interest rate = LIBOR + 80bps
= 7.75 + 0.8
= 8.55%
Interest paid in the second period
= $1,000,000 × 8.55%
= $1,000,000 × 0.0855
= $85,500
Note that there is no need for using the cap since the interest didn't exceed 9.25%
A firm sells two products, Regular and Ultra. For every unit of Regular sold, two units of Ultra are sold. The firm's total fixed costs are $1,947,000. Selling prices and cost information for both products follow. What is the firm's break-even point in units of Regular and Ultra?
Answer:
the firm must sell 37,443 units of Regular and 74,886 units of Ultra
Explanation:
Regular - unit sales price= $20; Variables costs per unit = $8
Ultra - unit sales price= $24; Variables costs per unit = $4
combined contribution margin:
1 unit of regular = $20 - $8 = $122 units of ultra = $48 - $8 = $40total = $52break even point = total fixed costs / combined contribution margin = $1,947,000 / $52 = 37,442.31 ≈ 37,443 units
the firm must sell 37,443 units of Regular and 74,886 units of Ultra
For the next 2 questions, use the financials of Acme Corporation. After adjusting revenue for accounts receivable and deferred revenue, how much cash did Acme generate from revenue for the nine months ending September 30, 2017
Answer: B. $892.1 million
Explanation:
The Revenue was $939,393 million
When calculating how much cash was generated any increase to the Accounts Receivables is removed from the revenue because it signifies that more sales were made on credit and so have not given the business cash yet.
Any increase in Deferred Revenue must be added because this is Cash that has been given to the business but for accrual purposes cannot be recognized yet. Bottomline however, the Cash has been received.
Increase in Receivables = 309,196 - 221,504
= $87,692 million
Increase in Deferred Revenue= 374,730 - 334,358
= $40,372 million
The Cash generated is therefore;
= 939,393 - 87,692 + 40,372
= $892,073
= $892.1 million
I have attached the Financial Statements of Acme Corporation.
Our company is growing fast, which always means changes and innovations. Because of this growth, the accounting department will be restructured. For the last five years, Paolo has served as chief manager with grace and dedication. However, because of the restructuring, Paolo’s position will no longer be needed. He will be working in the marketing department on the third floor, starting next Tuesday.In this message, the organizational pattern is used.Outlines give you a chance to organize your thinking before determining word choice and sentence structure. Which of the following will help you create a more effective outline?Avoid illustrations when supporting subpointsCombine subpoints whenever possiblePut the main idea in the titleUse one subpoint per main ideaUse evidence to support subpointsInclude 3 to 5 major components
Complete question
(1) ...In this message, the___organizatipn pattern is used.
(2) Which of the following will help youcreate a more effective outline?Check all that apply.
a) Put the main idea in the title,
b) Use one sub-point per main idea,
c) Use evidence to support sub-points,
d) Include 3 to 5 major components,
e) Combine subpoints whenever possible,
f) Avoid illustrations when supporting subpoints
Answer:
1. indirect organizational pattern
2. a, c, d
Explanation:
1. Since the nagative information was placed at the end of the message it follows an Indirect message pattern inorder to minimise negative feelings by the listeners.
2. A more effective outline is created when the main idea of the message is placed in the title, while also using supporting evidence to discuss the sub-points. And finally limiting the use of illustrations when supporting subpoints.
Bannister Co. is thinking about having one of its products manufactured by a subcontractor. Currently, the cost of manufacturing 1,000 units is: Direct material $ 45,000 Direct labor 30,000 Factory overhead (30% is variable) 98,000 If Bannister can buy 1,000 units from an outside supplier for $100,000, it should:
Answer:
Production total cost= $104,400
It is more profitable to buy the product.
Explanation:
Giving the following information:
Production costs (1,000 units):
Direct material $ 45,000
Direct labor $30,000
Factory overhead (30% is variable) 98,000
Buy:
1,000 units from an outside supplier for $100,000.
I will assume that the fixed overhead is not avoidable, therefore it should not be taken into account for the decision making.
Production total cost= 45,000 + 30,000 + (98,000*0.3)
Production total cost= $104,400
It is more profitable to buy the product.
The Callie Company has provided the following information: Operating expenses were $244,000; Cost of goods sold was $378,000; Net sales were $940,000; Interest expense was $47,000; Gain on sale of a building was $84,000; Income tax expense was $142,000. What was Callie's gross profit
Answer:
Callie's Gross Profit is $562000
Explanation:
Gross profit is the profit earned by a business after deducting the costs associated with producing or selling its goods (for manufacturing and trading businesses) or the costs associated with providing the services (for service businesses) from the net revenue.
It is the profit from the trading section of the business before deducting the operating and financing expenses of the business and before adding any other income.
The gross profit is simply calculated as follows,
Gross Profit = Net Revenue - Cost of Goods Sold
Callie's gross profit = 940000 - 378000
Callie's Gross Profit = 562000
Sarbanes-Oxley Act requires each of the following: (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
Required information An internal control system consists of the policies and procedures managers use to protect assets, ensure reliable accounting, promote efficient operations, and uphold company policies. It can prevent avoidable losses and help managers both plan operations and monitor company and human performance. Principles of good internal control include establishing responsibilities, maintaining adequate records, insuring assets and bonding employees, separating recordkeeping from custody of assets, dividing responsibilities for related transactions, applying technological controls, and performing regular independent reviews. Knowledge Check 01 Sarbanes-Oxley Act requires each of the following: (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark willl be automatically graded as incorrect.) An effective internal control ? Light penalties for violators Auditors must evaluate internal controls Auditor's work overseen by Public Accounting Board
Answer: An effective Internal Control
Auditors must evaluate internal controls
Auditor's work overseen by Public Accounting Board
Explanation:
The early part of the 21st century saw shocking financially improper activities by companies such as WorldCom and Enron exposed to the world. Investor Confidence was shaken and the government needed to do something to restore it.
This was why in 2002, the US Congress passed the Sarbanes-Oxley act that aimed to ensure that the actions of those companies were never repeated.
The act requires the following;
a) An effective Internal Control
The act requires that companies enact very effective Internal controls to detect financial irregularities and even went forward to make it the responsibility of the Top Executives to ensure that this is so.
b) Auditors must Evaluate Internal Controls.
Auditors had to change their auditing strategies that were deemed inefficient. They are now required to properly evaluate in-depth, the internal controls that a company adopts to be able to give an opinion on it and they do this based on the guidelines of the Public Accounting Board.
c) Auditor's work overseen by Public Accounting Board
The Public Company Accounting Oversight Board (PCAOB) was established by the Sarbanes-Oxley Act with it's main purpose being to monitor and oversee auditors as they audit companies so that they may protect the public from false financial information. They set rules and standards that Auditors must follow and these rules in turn have to be approved by the Securities and Exchanges Commission (SEC).
To ensure that the deeds of those corporations were never repeated, the US Congress created the Sarbanes-Oxley act in 2002:
An effective Internal Control.Auditors must evaluate internal controls.Auditor's work overseen by Public Accounting Board.US Congress passed the Sarbanes-Oxley act, all financial reports must contain an Internal Controls Report demonstrating that the company's financial data is accurate and that sufficient controls are in place to protect it.
A yearly evaluation of internal controls by a third-party CPA firm to see how successful each one is. The auditor of a publicly traded firm must vouch for management's evaluation of internal controls and provide a report on it.
As a result, the significance of the Sarbanes-Oxley Act requires are the aforementioned.
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You were recently hired at a software engineering company, and today is your first team meeting. You want to convey to your new team members that you are excited to join them and that you will be an engaged and respectful addition to the team.
What form of nonverbal communication will serve you best?
a. Hugs
b. Prolonged eye contact
c. Punctuality
A movie studio sells the latest movie on DVD to VideosRUs at $10 per DVD. The studio's cost of production is $1 per DVD. VideosRUs prices the videos at $19.99 to its customers. The studio offers to buy back unsold DVDs for $5. The studio must pay $.50 disposal fee for all returned DVDs. How many videos should VideosRUs order if the current sales forecast for the DVD is that demand will be normal with a mean of 10,000 and a standard deviation of 5,000
We want to find the number of DVDs that maximizes expected profit. To do this, we need to calculate the expected profit for different quantities of DVDs and choose the one that gives the highest profit. By selling 7,000 DVDs get a maximum profit.
What is the profit maximization method?To ensure the best output and price levels are realized in order to maximize returns, business firms engage in the process of profit maximization. In order to achieve its profit objectives, the company modifies important variables including sale price, production costs, and output levels.
To determine how many videos VideosRUs should order, we need to calculate the expected profit for each DVD sold.
The profit per DVD for VideosRUs can be calculated as follows:
Revenue per DVD = $19.99
Cost per DVD = $10
Profit per DVD = Revenue per DVD - Cost per DVD = $19.99 - $10 = $9.99
The studio's profit per DVD can be calculated as follows:
Revenue per DVD = $10 (the amount they sold the DVD to VideosRUs for)
Cost per DVD = $1
Profit per DVD = Revenue per DVD - Cost per DVD = $10 - $1 = $9
To calculate the probability of selling, we need to use the normal distribution with a mean of 10,000 and a standard deviation of 5,000. Since we don't know the actual demand, we can use a probability distribution to estimate the likelihood of selling different quantities of DVDs.
The required calculation is shown in the file given attached below.
Thus, selling 7000 DVDs get the highest profit.
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The following information applies to Pro-Weave manufactures stadium blankets by passing the products through a weaving department and a sewing department. The following information is available regarding its June inventories:
Beginning Inventory Ending Inventory
Raw materials inventory $ 120,000 $ 185,000
Work in process inventory-Weaving 300,000 330,000
Work in process inventory-Sewing 570,000 700,000
Finished goods inventory Inventory 1,266,000 1,206.000
The following additional information describes the company's manufacturing activities for June:
Raw materials purchases (on credit) Factory wages cost (paid in cash) Other factory overhead cost (other Accounts credited) Materials used 500,000 3,060,000 156, 000 Direct-Weaving Direct-Sewing Indirect $ 240, 000 75,000 120,000 Labor used Direct-Weaving Direct-Sewing Indirect $1,200, 000 360,000 1,500,000 Overhead rates as a percent of direct labor Weavinqg Sewing 80% 150% Sales (on credit) $4,000,000
1. Compute the (a) cost of products transferred from weaving to sewing, (b) cost of products transferred from sewing to finished goods and (c) cost of goods sold
2. Prepare journal entries dated June 30 to record (a) goods transferred from weaving to sewing, (b) goods transferred from sewing to finished goods, and (c) sale of finished goods
Complete this question by entering your answers in the tabs below
Required 1
Required 2
Compute the (a) cost of products transferred from weaving to sewing, (b) cost of products transferred from sewing to finished goods, and (c) cost of goods sold
(a) Sewing
(b) Finished Goods
(c) Cost of goods sold
Find the given attachments
You are trying to get a group of students interested in forming an organization to help fight fee increases at your college. Unfortunately, things don’t seem to be going very well—nobody in your group volunteered to go to a meeting with your college president next week. You want to create a culture that is active and involved. What should you do? A. Make sure that you do what you want your team to do. If you want them to volunteer, you need to volunteer, too. B. Don't talk about taking action. Instead, get to know your team members better. C. Paint a verbal picture for your team of what life would be like if fees were reduced. D. Make sure that anyone on your team who volunteers to take action gets a reward - publicly recognize their efforts.
Answer:
The correct action is the option B: Don't talk about taking action. Instead, get to know your team members better.
Explanation:
To begin with, if the person is trying to create a group that is involved in the situation and works together then the best option to take at the beginning would be to get to know them better, so in that way the person would understand them and know what motivates each one the members in order to make them understand as well why would be benefitial for everybody to fight the fee increases and he can do that by explaining to everyone how those increases would impact in what motivates them the most. So that is why, is better to understand them and explain them later how to take action.
Answer:
The correct action is the option B: Don't talk about taking action. Instead, get to know your team members better.
Explanation:
To begin with, if the person is trying to create a group that is involved in the situation and works together then the best option to take at the beginning would be to get to know them better, so in that way the person would understand them and know what motivates each one the members in order to make them understand as well why would be benefitial for everybody to fight the fee increases and he can do that by explaining to everyone how those increases would impact in what motivates them the most. So that is why, is better to understand them and explain them later how to take action.
Which of the following, if true, would illustrate why price indexes such as the CSPI might overstate inflation in the cost of going to college? Check all that apply. The quality and design of calculators improved dramatically from 2017 to 2019. For example, calculators made in 2019 accept memory cards, whereas those made in 2017 do not, but this quality change is hard to measure. A new, safe method of memory enhancement became available for purchase. Professors required each student to buy 10 textbooks, regardless of the price. As the price of textbooks increased, more and more students turned to the used-book market or chose not to buy textbooks at all, instead using the copies on reserve in the library.
Answer:
- The quality and design of calculators improved dramatically from 2017 to 2019.
- A new, safe method of memory enhancement became available for purchase.
- As the price of textbooks increased, more and more students turned to the used-book market or chose not to buy textbooks at all, instead of using the copies on reserve in the library.
Explanation:
Remember, regarding the prices for the textbooks the factors of demand applies that is why when prices increase, it might result in an overstating; which means inflation in the cost of going to college.
Also, just as improvements in the memory of calculators involves additional expenses, it results in inflation. Overall, all these circumstances can result in such inflation.
The true statements are
The quality and design of calculators improved dramatically from 2017 to 2019.
A new, safe method of memory enhancement became available for purchase.
As the price of textbooks increased, more and more students turned to the used-book market or chose not to buy textbooks at all, instead of using the copies on reserve in the library.
Price index:In the given situation, the statement that need to be considered is that when the design and quality of calculated improved, the new & safe method should be available, and in the case when the price of the textbook rises so more students used book market rather reserving libraries book.
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A clothing manufacturer produces clothing in five locations in the United States. In a move to vertical integration, the company is planning a new fabric production plant that will supply fabric to all five clothing plants. The clothing plants have been located on a coordinate system as follows: Location (X,Y) A 7,2 B 4,7 C 5,5 D 6,2 E 8,4 If the amount of fabric shipped to each plant are equal, what is the optimal location for the fabric plant?
Answer:
(6,4)
Explanation:
The computation of optimal location for the fabric plant is shown below:-
X Y
A 7 2
B 4 7
C 5 5
D 6 2
E 8 4
Total 30 20
[tex]\bar X = \frac{Total\ of\ X}{Total\ number\ of\ locations}[/tex]
[tex]\bar X = \frac{30}{5}[/tex]
= 6
[tex]\bar Y = \frac{Total\ of\ Y}{Total\ number\ of\ locations}[/tex]
[tex]\bar Y = \frac{20}{5}[/tex]
= 4
So, the optimal location for the fabric plant is (6,4)
New lithographic equipment, acquired at a cost of $800,000 at the beginning of a fiscal year, has an estimated useful life of five years and an estimated residual value of $90,000. The manager requested information regarding the effect of alternative methods on the amount of depreciation expense each year. On the basis of the data presented to the manager, the double-declining-balance method was selected.
In the first week of the fifth year, the equipment was sold for $135,000.
Required:
1. Determine the annual depreciation expense for each of the estimated five years of use, the accumulated depreciation at the end of each year, and the book value of the equipment at the end of each year by the following methods:
a. Straight-line method
Year Depreciation Expense Accumulated Depreciation, End of Year Book Value, End of Year
1 $ $ $
2 $ $ $
3 $ $ $
4 $ $ $
5 $ $ $
b. Double-declining-balance method
Year Depreciation Expense Accumulated Depreciation, End of Year Book Value, End of Year
1 $ $ $
2 $ $ $
3 $ $ $
4 $ $ $
5 $ $ $
Hide
2. Journalize the entry to record the sale, assuming double-declining balance method is used. If an amount box does not require an entry, leave it blank.
3. Journalize the entry to record the sale, assuming that the equipment was sold for $88,750 instead of $135,000. If an amount box does not require an entry, leave it blank.
Answer:
a. Straight-line Method :
Year Depreciation Accumulated End of Year Book Value
0 Expense Depreciation $800,000
1 $142,000 $142,000 $ 658,000
2 $142,000 $284,000 $ 516,000
3 $142,000 $426,000 $ 374,000
4 $142,000 $568,000 $ 232,000
5 $142,000 $710,000 $90,000
b. Double-Declining-Balance Method:
Year Depreciation Accumulated End of Year Book Value
0 Expense Depreciation $800,000
1 $320,000 $320,000 $ 480,000
2 $192,000 $512,000 $ 288,000
3 $115,200 $627,200 $ 172,800
4 $69,120 $696,320 $ 103,680
5 $13,680 $710,000 $90,000
2. Journal entry to record the sale, assuming double-declining balance method:
Debit Cash $135,000
Credit Sale of Equipment $135,000
To record sale of equipment.
Debit Sale of Equipment $103,680
Debit Accumulated Depreciation $696,320
Credit Equipment $800,000
To record close of accumulated depreciation and equipment accounts.
3. Journal entry to record sale, assuming equipment was sold for $88,750:
Debit Cash $88,750
Credit Sale of Equipment $88,750
To record sale of equipment.
Debit Sale of Equipment $103,680
Debit Accumulated Depreciation $696,320
Credit Equipment $800,000
To record close of accumulated depreciation and equipment accounts.
Explanation:
a) Straight-line method of depreciation applies the same amount of depreciation charge over the life of the asset. It is calculated by subtracting the salvage value from the asset and dividing the resulting figure by the number of useful life in years. It is very simple, but does not take into consideration maintenance costs incurred as assets age. Therefore, it does not spread the costs of the asset evenly over the periods the asset is in use, or according to the productivity value of the asset in each period.
b) Declining balance method of depreciation accelerates depreciation charge initially but the annual expense declines with age of the fixed asset. Under this method, depreciation expense is calculated by applying the depreciation rate to the book value of the asset at the start of the period.
Trade-Off Theory. Smoke and Mirrors currently has EBIT of $25,000 and is all-equity- financed. EBIT is expected to stay at this level indefinitely. The firm pays corporate taxes equal to 35% of taxable income. The discount rate for the firm’s projects is 10%.(LO3)
a. What is the market value of the firm?
b. Now assume the firm issues $50,000 of debt paying interest of 6% per year, using the proceeds to retire equity. The debt is expected to be permanent. What will happen to the total value of the firm (debt plus equity)?
c. Recompute your answer to (b) under the following assumptions: The debt issue raises the probability of bankruptcy. The firm has a 30% chance of going bankrupt after 3 years. If it does go bankrupt, it will incur bankruptcy costs of $200,000. The discount rate is 10%. Should the firm issue the debt?
Answer:
a. What is the market value of the firm?
$162,500b. Now assume the firm issues $50,000 of debt paying interest of 6% per year, using the proceeds to retire equity. The debt is expected to be permanent. What will happen to the total value of the firm (debt plus equity)?
$200,123c. Recompute your answer to (b) under the following assumptions: The debt issue raises the probability of bankruptcy. The firm has a 30% chance of going bankrupt after 3 years. If it does go bankrupt, it will incur bankruptcy costs of $200,000. The discount rate is 10%. Should the firm issue the debt?
The firm should not issue the debt because the risk of bankruptcy eliminates any possible gains obtained from issuing debt. It actually decreases the value of equity.Explanation:
the firm's current value = [EBIT x (1 - tax rate)] / WACC = [$25,000 x 0.65] / 10% = $162,500
firm's new WACC = ($112,500/$162,500 x 10%) + ($50,000/$162,500 x 6% x 0.65) = 6.92% + 1.2% = 8.12%
the firm's new value = [$25,000 x 0.65] / 8.12% = $200,123
expected cost of bankruptcy = (30% x $200,000) / 1.1³ = $45,079
firm's total value is still $200,123, but the stockholders' equity has been reduced from ($200,123 - $50,000 = $150,123) to $150,123 - $45,079 = $105,044
the gain from issuing debt will be eliminated due to the risk of bankruptcy, before equity had risen from $112,500 to $150,123, but now it decreases to $105,044.
The market value of the firm will be $162500.
Based on the information given, the market value will be calculated thus:
= [EBIT × (1 - Tax rate(] / WACC
= [25000 × (1 - 0.35)] / 10%
= [25000 × 0.65] / 0.10 = $162500
Since the firm's new WACC is 8.12%, then the new value of the firm will be:
= (25000 × 0.65) / 8.12%
= 200,123
Therefore, the total value of the firm is $200,123.
In conclusion, the firm should not issue the debt due to the fact that the risk of bankruptcy will eliminate the gains gotten from the issuance.
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Ans:
5. Abena travelled 40% of the distance of her trip alone, went another 35 miles with Saralyn,
and then finished the last half of the journey alone. How many miles long was the journey?
Ans:
miles
6. The mean of the data set (9,5,7, 2, x} is twice the data set (8,x, 4,1,3}. What is (y - x)2?
Ans:
UGRC 120: Numeracy Skills
Page 5 of 8
Answer:
5) 350 miles
Explanation:
5)
40% + 35 miles = 50%
=> 50% - 40% = 35 miles = 10%
=> 100% = 35 * (100% / 10%) = 35 * 10 = 350 miles
Identify whether each of the following examples belongs to Money aggregates (M1 or M2). If an example belongs in both, be sure to write it down.
a. Sean has $30,000 in a money market account.
b. Musashi has a roll of quarters that he just withdrew from the bank to do laundry.
c. Yvette has $7,000 in a two-year certificate of deposit (CD).
Any type of money that falls into the M2 category is, by definition, part of M1 as well.
a. True
b. False
Answer: 1. a) M2
b) M1 and M2
c) M2
2. b. False
Explanation:
1.
M1 is a type of definition of money by economists that seek to explain the circulation of money in the economy. It includes cash and cash equivalents that are easy to convert into cash. This includes actual physical cash as well as Demand Deposits.
M2 is the definition that follows after M1. M2 by definition includes all the types of cash in M1 as well as deposits less than $100,000, non Institutional Money Market Fund investments and savings deposits. It isn't as liquid as M1 but is very important in forecasting inflation.
The classifications therefore are,
a) M2. This is M2 as it is a Non Institutional Money Market investment by Sean.
b) M1 and M2. This is physical cash and as such is part of M1 and as stated, anything part of M1 is part of M2 as well.
c) M2. As a deposit less than $100,000, the $7,000 that Yvette has in the CD classifies as M2.
2. False.
Money that is part of M2 is not automatically part of M1. M1 includes only physical cash as well as Demand Deposits while M2 has other forms such as savings deposits and small time deposits. Money that is part of M1 is automatically part of M2 and not the other way around.
Ataxia Fitness Center is considering an investment in some additional weight training equipment. The equipment has an estimated useful life of 4 years with no salvage value at the end of the 4 years. Ataxia's internal rate of return on this equipment is 5%. Ataxia's discount rate is also 5%. The payback period on this equipment is closest to (Ignore income taxes.):
Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factorfs) using the tables provided.
a. 4 years
b. 3.55 years
c. 2.00 years
d. 4.65 years
Answer:
b. 3.55 years
Explanation:
The payback period is basically the amount of time an investor needs to recover his/her initial investment.
lets assume initial investment = $1,000
when you calculate IRR, the present value of the cash flows = initial investment
the present value of an annuity for 4 years and 5% is 3.5460
$1,000 = yearly cash flow x 3.546
yearly cash flow = $1,000 / 3.546 = $282
payback period = $1,000 / 282 = 3.546 years ≈ 3.55 years
Required informationUse the following information for the Exercises below.[The following information applies to the questions displayed below.]
Del Gato Clinic deposits all cash receipts on the day when they are received and it makes all cash payments by check. At the close of business on June 30, 2015, its Cash account shows an $11,589 debit balance. Del Gato Clinic's June 30 bank statement shows $10,555 on deposit in the bank.
a. Outstanding checks as of June 30 total $1,829.
b. The June 30 bank statement included a $16 debit memorandum for bank services.
c. Check No. 919, listed with the canceled checks, was correctly drawn for $467 in payment of a utility bill on June 15. Del Gato Clinic mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $476.
d. The June 30 cash receipts of $2,856 were placed in the bank's night depository after banking hours and were not recorded on the June 30 bank statement.
1. Prepare the adjusting journal entries that Del Gato Clinic must record as a result of preparing the bank reconciliation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
2. Prepare a bank reconciliation for Del Gato Clinic using the above information:
Answer:
a. No journal entry required
b. Miscellaneous expense A/c Dr $16
To Cash A/c $16
(service charge)
c. Cash A/c Dr $9 ($476 - $467)
To Utilities expense A/c $9
4. No journal entry required
2.) Kindly check attached picture
Explanation:
Kindly check attached picture
The following accounts were taken from the Adjusted Trial Balance columns of the end-of-period spreadsheet for April 30, for Finnegan Co.: Accumulated Depreciation $32,000 Fees Earned 78,000 Depreciation Expense 7,250 Rent Expense 34,000 Prepaid Insurance 6,000 Supplies 400 Supplies Expense 1,800 Prepare an income statement.
Answer:
Explanation:
Income statement for Finnegan Co for the period Ended April 30
Fees earned ( Revenue) 78,000
Depreciation Expenses (7,250)
Rent expenses (34,000)
Supplies Expenses (1800)
Income 34,950
Prepaid insurance (6000) and supplies (400) are current assets item of the statement of financial position (balanced sheet) while accumulated depreciation (32000) is a contra asset account on the balanced sheet as a reduction on the fixed assets.
2 brothers, Joe and Bob get equal dollar amounts of securities as a gift. Joe immediately sells his securities and deposits the money to a bank account. On the other hand, Bob keeps his securities positions and holds them in a brokerage account. After 5 years, Joe has $10,000 in his bank account, while Bob has $30,000 in his brokerage account. The $20,000 difference between the account balances is explained by:
Answer:
Opportunity cost
Explanation:
The opportunity cost Bob's brother Joe $20,000. Remember, the term Opportunity cost refers to the cost (loss in this context) incurred when one forgoes an alternative best option–holding them in a brokerage account, in place for a less beneficial one.
Thus, Bob chose the best alternative over his brother.
You consider buying a share of stock at a price of $21. The stock is expected to pay a dividend of $2.04 next year, and your advisory service tells you that you can expect to sell the stock in 1 year for $24. The stock's beta is 1.2, rf is 8%, and E[rm] = 16%. What is the stock's abnormal return?A. 1%
B. 2%
C. -1%
D. -2%
E. None of the above
Answer:
E. None of the above
Explanation:
First we need to calculate the holding period return
Holding period return is the rate of return which an assets earns during the period in which it holds the assets.
Holding Period Return = (Selling Price - Initial Price + Dividend ) / Initial Price
Holding Period Return = ($24 - $21 + $2.04 ) / $21 = 0.24 = 24%
Now we need to calculate the expected return on the stock using CAPM formula as follow
Expected return = Risk free rate + Beta ( Market Risk Premium )
Expected return = rf + beta ( E(rm) )
Placing values in the formula
Expected return = 8% + 1.2 ( 16% )
Expected return = 27.2%
Abnormal return is the difference of Holding period return and expected return
Abnormal return = 27.2% - 24% = 3.2%
Wright Machinery Corporation manufactures automobile engines for major automobile producers. The engines sell for $910 per engine. In addition, customers have the option to purchase a service-type warranty for $70 per engine that protects against any defects for a period of 5 years. During 2019, Wright sold 9,000 engines to National Motors. National Motors purchased warranties on all of the engines purchased. During 2019, Wright repaired defective motors at a cost of $93,400.
Prepare the necessary journal entries to record:__________.1. The sale of engines and service warranty on account during 2016 (one entry).2. The warranty costs paid during 2016.3. The warranty revenue earned in 2016.
Answer:
1. The sale of engines and service warranty on account during 2016 (one entry).
Dr Cash 8,820,000
Cr Sales revenue 8,190,000 (= 9,000 x $910)
Cr Unearned warranty revenue 630,000 (= 9,000 x $70)
2. The warranty costs paid during 2016.3. The warranty revenue earned in 2016.
to record warranty expenses during the year
Dr Warranty expense 93,400
Cr Cash 93,400
to record warranty revenue
Dr Unearned warranty revenue 126,000 (= $630,000 / 5 = $126,000)
Cr Extended warranty revenue 126,000
Explanation:
Service-type warranties sold are a liability for the company (unearned revenue) and they will be accrued as time goes on. In this case, accrued warranty revenue is adjusted annually but it could also be adjusted monthly.
Suppose you are an analyst in the oil refinery industry and are responsible for estimating the equilibrium price and quantity of home heating oil. To do so, you must consider factors that can affect the supply of and demand for heating oil.
Determinants of the demand for heating oil include household income, the price of an oil furnace (a complement to heating oil) and the price of natural gas (a substitute for heating oil). Determinants of the supply of heating oil include the cost of crude oil and the cost of refining crude oil into home heating oil.
1. Suppose that all of the determinants of the supply and demand for heating oil are equal to their initital values. The equilibrium quantity in this market is ___ barrels of heating oil per day,
A. 60,000
B. 50,000
C. 70,000
D. 80,000
E. 40,000
2. and the equilibrium price is ____ per barrel.
A. $40
B. $70
C. $60
D. $50
E. $80
Answer:
1. 80,000
2. $40 per barrel
Explanation:
1. As we can see from the table provided The equilibrium quantity in this market is 80,000 barrels of heating oil per day, as quantity demanded match quantity supplied
2. As we can see from the table provided The equilibrium price is $40 per barrel as in this cost there is an intersection of quantity demanded and quantity supplied. In other words the equilibrium price and quantity could be find out when the quantity demanded equal to quantity supplied
Clemens Cars’s job cost sheet for Job A40 shows that the cost to add security features to a car was $23,500. The car was delivered to the customer, who paid $28,200 in cash for the added features. What journal entries should Clemens record for the completion and delivery of Job A40?
Answer:
Finished Goods
Dr Working in progress $23,500
Cr Transfer from Work in progress to Finished goods $23,500
Cost of goods sold
Dr Finished Goods $23,500
Cr Transfer from Finished Goods to Cost of goods sold $23,500
CASH
Dr Sales $ 28,200
Cr Sale of car after job was completed $28,200
Explanation:
Clemens Cars’s Journal entries
Finished Goods
Dr Working in progress $23,500
Cr Transfer from Work in progress to Finished goods $23,500
Cost of goods sold
Dr Finished Goods $23,500
Cr Transfer from Finished Goods to Cost of goods sold $23,500
CASH
Dr Sales $ 28,200
Cr Sale of car after job was completed $28,200
Horizontal analysis: Is also called vertical analysis. Is the presentation of financial ratios. Is a tool used to evaluate financial statement items relative to industry statistics. Is a method used to evaluate changes in financial data across time. Evaluates financial data across industries.
Answer:
Explanation:
Horizontal analysis is comparing financial statistics or data over a period of time. it is also known as trend analysis.
Vertical analysis compares line items within the same period.
I hope my answer helps you
Twinte Cars, a California corporation, has internal corporate requirements that stipulate a three-year payroll document retention period. It enters into a contract with an international company that mandates a six-year payroll document retention requirement. How should Twinte Cars balance these requirements
Answer:
-The period for retention could be up to 8 years depending upon the circumstances.
-The benefits and records may be called to evidence
Explanation:
In this scenario Twinte cars needs to balance internal requirement of 3 year payroll document retention period and the contract if 6 year payroll retention with the international company. Usually foreign companies have a higher retention requirement.
A way out of this predicament will be to get a new retention period of 8 years. This will satisfy requirements of the international company.
Also Twinte cars can provide benefits and records from their internal 3 year payroll retention to the international company
Flynn Industries has three activity cost pools and two products. It estimates production 3,000 units of Product BC113 and 1,500 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Flynn accumulated the following data relative to those activity cost pools and cost drivers.
Annual Overhead Data Estimated Use of Cost Drivers per Product
Activity Cost Pools Cost Drivers Estimated Overhead Estimated Use of Cost Drivers per Activity Product BC113 Product AD908
Machine setup Setups $16,000 40 25 15
Machining Machine hours 110,000 5,000 1,000 4,000
Packing Orders 30,000 500 150 350
Required:
Prepare a schedule showing the computations Of the activity-based Overhead rates per cost driver.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Machine setup Setups $16,000 40 25 15
Machining Machine hours $110,000 5,000 1,000 4,000
Packing Orders $30,000 500 150 350
To calculate the estimated manufacturing overhead rate we need to use the following formula:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Machine setup= 16,000/(40+25+15)= $200 per setup
Machining= 110,000/ (5,000 + 1,000 + 4,000= $11 per machine hour
Packing= 30,000/ (500 + 150 + 350)= $30 per order
Stellar Corporation began operations on January 1, 2014. During its first 3 years of operations, Stellar reported net income and declared dividends as follows.Net incomeDividends declared2014 $49,500 $ –0– 2015 128,600 59,600 2016 161,000 58,800 The following information relates to 2017.Income before income tax $231,000 Prior period adjustment: understatement of 2015 depreciation expense (before taxes) $32,000 Cumulative decrease in income from change in inventory methods (before taxes) $44,800 Dividends declared (of this amount, $32,000 will be paid on January 15, 2018) $118,400 Effective tax rate 40 %Prepare a 2017 retained earnings statement for Stellar Corporation. (List items that increase adjusted retained earnings first.)
Answer:
$194,820
Explanation:
Retained earnings at the end of 2017 is computed thus:
2014 net income $49,500
2014 dividends ($0)
2014 retained earnings $49,500
2015 net income $128,600
2015 dividends ($59,600)
2015 retained earnings $118,500
2016 net income $161,000
2016 dividends ($58,800)
2016 retained earnings $220,700
understatement of depreciation expense
after tax impact $32,000-(40%*$32,000) ($19,200)
After tax impact of decrease in net income due
to inventory method $44,800-($44,800*40%) ($26,880)
Adjusted retained earnings for 2016 $174,620
net income for 2017 $231,000-($231,000*40%) $138,600
dividends declared for 2017 ($118,400)
Retained earnings for 2017 year end $194,820
Retained earnings in the adjustment in each is the retained earnings brought forward plus the net income for the current year minus dividends declared for the year
A project manager is preparing two documents for risk management. One contains sources of overall project risk and also summary information on individual risks. The second describes individual risks identified. What name should the project manager give to the first document
Answer: Risk Report
Explanation:
A Risk Report for a project contains all the risk that the project is exposed to. This includes both project risk as well as individual risks related to the components projects in the overall project.
A Risk Report details the risks such as Supplier failure, Inflation, Pending Government Regulations and the like. It then takes these and summarizes them for presentation to those who require this information in the company so that appropriate safeguards may be set up and precautions taken.
This describes the first document and so should be what the Project Manager names it.