Answer: Please refer to Explanation.
Explanation:
A class of stock that provides no preference rights to shareholders. COMMON STOCK.
The number of shares currently held by stockholders. OUTSTANDING SHARES.
The number of shares sold to stockholders. ISSUED SHARES.
The account used to record the difference when issue price exceeds par value of stock. PAID-IN CAPITAL IN EXCESS OF PAR.
The maximum number of shares a company can issue to shareholders. AUTHORIZED SHARES.
A financial institution that records and maintains records of another company's stockholders. TRANSFER AGENT.
A class of stock having first rights to dividends of a corporation. PREFERRED STOCK.
Selected information from Frosty Freeze Corporation's accounting records and financial statements for 2022 is as follows ($ in millions): Cash paid to acquire machinery$34 Reacquired Peridot common stock 54 Proceeds from sale of land 93 Gain from the sale of land 54 Investment revenue received 73 Cash paid to acquire office equipment 87 In its statement of cash flows, Frosty Freeze should report net cash outflows from investing activities of: Multiple Choice $101 million. $28 million. $80 million. $33 million.
Answer:
$45 million
Explanation:
The cash flow statement categories the company's transactions in a financial period into 3 groups; these are operating, investing and financing.
The net profit/loss, depreciation, changes in current assets (other than cash) and liabilities are considered as operating activities including income taxes.
The sale of assets, interest received, purchase of investments are examples of investing activities while the issuance of stocks, debt principal deduction (loan settlement), issuance of debt securities etc are examples of financing activities.
An increase in assets other than cash is an outflow of cash while an increase in liabilities is an inflow of cash.
Hence, the net cash outflows from investing activities (in $'million)
= -$34 + $93 + $73 - $87
= $45
Suppose that SoS sells both versions and wants to charge different prices for different versions. What is the highest price of the bluetooth version for the high-valuation buyers? (Hint: Since low-valuation buyers will not have an incentive to buy the more expensive version, the highest price of the stripped-down version for the low-valuation buyers is equal to their willingness to pay, i.e., pL = $250)
Answer:
Check the explanation
Explanation:
Since the high valuation customers are willing to pay $500 for the Bluetooth headphones, that price should be set for the Bluetooth versions. The problem will arise if the high valuation customers shift to the stripped down version as well. However, since they care for the Bluetooth versions and stripped down versions separately, it is highly likely that they will prefer the Bluetooth headphones.
So the highest price that can be set for the Bluetooth headphones for the high value buyer will be $500.
5) If the price is set at $500 for high value customers and $250 for low value customers, total profit can be given as
Profit = 1,000,000 * (250 - 100) + 800,000 * (500 - 100)
Profit = 150,000,000 + 320,000,000 = $470 million
You will be meeting with HP employees to work with them to identify their company resources that are valuable (V), rare (R), and costly to imitate (I) as well as how they are organized (O) to capture the value of the resources. Which of the following could you do in order to capture this information?Check all that apply:A) have a discussion with HP's upper management. B) research patents submitted by HP's product development engineers. C) send a survey to HP employees. D) eat lunch In the cafeteria at HP's headquarters to explore their organic food options.
Answer:
The correct answers are the options A, B and C.
Explanation:
To begin with, if what the person is looking for is to gather information about the company HP, and more especifically about their resources, there are several actions that he can do in order to get all that information. For start, he can have an interview with the upper management in order to ask questions and obtain the preliminary answers to the information he is looking for and later use that info to make a survey good enough to gather more. Once all that is gathered together, what the person can do is to reasearch patents submitted by the company's engineers so in that way he might still increase the amount of info.
At the beginning of last year, Tarind Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Tari's fixed manufacturing overhead budget variance was $12,000 favorable. Its fixed manufacturing overhead volume variance was $19,200 favorable. Actual direct labor-hours for the year were 625,000. What was Tari's total standard machine-hours allowed for last year's output?
Answer:
The answer is 612800 hours
Explanation:
Solution
Recall that:
At the start of last year, Tari Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours.
At the end of the year, Tari's fixed manufacturing overhead budget variance was $12000 favorable. Its fixed manufacturing overhead volume variance was $19200 favorable. The direct actual labor-hours for the year were 625,000. What was Tari's standard total machine-hours allowed for last year's output?
Now,
The Budgeted at beginning of the year = $900,000
fixed manufacturing overhead for = 600,000 machine hours
Thus,
The Standard = $900,000 / 600,000 hours = $1.5 fixed overhead / machine/machining hour
So,
At end of year, manufacturing overhead volume was $19,200 favorable which means that,
$19200 / $1.5 = 12800 additional hours.
Total Standard Machine Allowance Allowed for output = 600,000 +12800 = 612800 hours
Therefore, Tari's total standard machine-hours allowed for last year's output is 612800 hours
If Tarind Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Its fixed manufacturing overhead volume variance was $19,200 favorable. What Tari's total standard machine-hours allowed for last year's output will be is: 612,800 machine hours
Using this formula
Total standard machine-hours=Machine -hours level of activity+ [Fixed manufacturing overhead volume variance÷(Fixed manufacturing overhead÷ Machine -hours level of activity)]
Where:
Machine -hours level of activity=600,000
Fixed manufacturing overhead volume variance=$19,200
Fixed manufacturing overhead=$900,000
Let plug in the formula
Total standard machine-hours=600,000+[$19,200÷($900,000÷600,000)]
Total standard machine-hours=600,000+($19,200÷1.5)
Total standard machine-hours=600,000+12,800
Total standard machine-hours=612,800 machine hours
Inconclusion if Tarind Corporation budgeted $900,000 of fixed manufacturing overhead and chose a denominator level of activity of 600,000 machine-hours. At the end of the year, Its fixed manufacturing overhead volume variance was $19,200 favorable. What Tari's total standard machine-hours allowed for last year's output will be is: 612,800 machine hours
Learn more here:
https://brainly.com/question/17272909
Are monopolies economically efficient? Consider the market to the right. Compared to the perfectly competitive outcome, what would be the change in surplus if instead the market had one supplier that was a monopoly?
Answer:
Deadweight loss (Triangle between all three lines, hits all three points).
Explanation:
This is explained to be triangle between all three lines as it hits all three points involved.
It can also be explained to be Harberger's triangle in the sense that the loss occurring in the trade of a good or service due to market power of buyers or sellers or a government intervention, or other bodies concerned is lost due when it is not produced maximumly to reach everyone who meeds it.
Deadweight loss, also can be a measure of lost economic efficiency when the socially optimal quantity of a good or a service is not produced. Non-optimal production can be caused by monopoly pricing in the case of artificial scarcity, a positive or negative externality, a tax or subsidy, or a binding price ceiling or price floor such as a minimum wage.
One could argue correctly that:
a. all firms in any industry can earn short-run but not necessarily long-run positive economic profit.
b. all firms in any industry can earn long-run but not necessarily short-run positive economic profit.
c. all firms in any industry can earn both short-run and long-run positive economic profit.
d. no firm in any industry can earn a long-run positive economic profit because all price changes made by any firm will be followed by all of the other firms.
e. all firms in any industry can earn a short-run positive profit if economies of scale exist.
Answer:
a. all firms in any industry can earn short-run but not necessarily long-run positive economic profit.
Explanation:
A firm economic profit if its accounting profit is greater than opportunity cost.
A firm earns accounting profit if its total revenue is greater than its total explicit cost.
A monopoly and oligopoly can earn positive economic profit in the short and long run because the industries have high barriers to entry and exit of firms.
On the other hand, a perfect competitive industry can earn only economic profit in the short run. Because of low barriers to entry of firms, if a firm is earning economic profit, in the long run new firms would enter into the industry and drive economic profit to zero.
I hope my answer helps you
Money's power to buy goods and services changes ________.
Answer:
...with rates of inflation.
Explanation:
The more that a particular currency appears in the market without any work (value) being associated with that currency, the smaller the value of that particular form of currency (For example, the U.S. dollar). When inflation is high, banks will increase interest rates on loans in order to get rid of some of the of the surplus currency in the market, bringing down inflation and increasing the total value of a particular form of currency.
Dax Pet Foods compiled the following information for the year for its dog division Average operating assets $3,500,000 Controllable margin $315,000 Dax’s corporate office expects the division to earn a minimum return of 8%. Suppose the dog division invests in a new machine that will produce a new dog food product. The machine is expected to generate $19,500 of controllable profit and will cost $150,000. If Dax buys the new machine, what happens to ROI?
Answer:$2836360
Explanation:
Ahmed, a lawyer, sold his car to Carlos. Has an implied warranty of merchantability been created by this transaction? No, because Ahmed is not a merchant. Yes, because if the car is defective Carlos will have a right to return in to Ahmed. No, Ahmed has not implied so either orally or in written. Yes, because a car is "goods" and the Uniform Commercial Code applies to contracts for the sale of goods.
Answer:
A. No, because Ahmed is not a merchant.
Explanation:
Implied warranty of merchantability is a law in contract which states that when there is a transaction between a seller (the merchant), and a buyer, there is an unwritten guarantee from the seller, that the product meets up to the ordinary standards of care. This means that the goods must be fit to do what the merchant says it will do. Therefore, if the seller finds it defective, he could return it to the seller. and if the seller refuses to make a change, a legal case could be established. The merchant by law is a wholesaler or retailer, who sells goods in which he has expertise or special skills.
Ahmed in the question could be argued in court to not be a merchant of cars and as such, has no expertise with which he can make a guarantee for the car being sold to Carlos.
A brown-eyed father and a green-eyed mother have a 25% chance of having a green-eyed child. What is the probability that, in a family of four children, three of them have green eyes?
a.0.421 875
c 0.011 718 75
b. 0046 875
d. 0.1875
Answer:t
Explanation:
Xion Co. budgets a selling price of $80 per unit, variable costs of $35 per unit, and total fixed costs of $270,000. During June, the company produced and sold 10,800 units and incurred actual variable costs of $351,000 and actual fixed costs of $285,000. Actual sales for June were $885,000. Prepare a flexible budget report showing variances between budgeted and actual results. List variable and fixed expenses separately. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance)
Answer and Explanation:
The preparation of flexible budget report is shown below:-
Xion CO.
Flexible budget report
Flexible budget Actual results Variances Favorable/
Unfavorable
Sales $864,000 $885,000 $21,000 Favorable
(10,800 × $80)
(-) Variable
cost $378,000 $351,000 $27,000 Favorable
(10,800 × $35)
Contribution $486,000 $534,000 $48,000 Favorable
(-) Fixed cost $270,000 $285,000 $15,000 Unfavorable
Net income $216,000 $249,000 $33,000 Favorable
Wehrs Corporation has received a request for a special order of 9,300 units of product K19 for $46.80 each. The normal selling price of this product is $51.90 each, but the units would need to be modified slightly for the customer. The normal unit product cost of product K19 is computed as follows: Direct materials $ 17.60 Direct labor 6.90 Variable manufacturing overhead 4.10 Fixed manufacturing overhead 7.00 Unit product cost $ 35.60 Direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like some modifications made to product K19 that would increase the variable costs by $6.50 per unit and that would require a one-time investment of $46,300 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order. Required: Determine the effect on the company's total net operating income of accepting the special order.
Answer:
Effect on income= $62,510 increase
Explanation:
Giving the following information:
Offer= 9,300 units of product K19 for $46.80 each.
Direct materials $ 17.60
Direct labor $6.90
Variable manufacturing overhead $4.10
The customer would like some modifications made to product K19 that would increase the variable costs by $6.50 per unit and that would require a one-time investment of $46,300 in special molds that would have no salvage value.
Because it is a special offer and there is unused capacity, we will take into account only the incremental fixed costs.
First, we need to calculate the total cost of the offer:
Unitary variable cost= 17.6 + 6.9 + 4.1 + 6.5= $35.1
Total variable cost= 35.1*9,300= $326,430
Total fixed costs= 46,300
Total cost= $372,730
Finally, we can determine the effect on income:
Effect on income= 9,300*46.8 - 372,730
Effect on income= $62,510 increase
[10 points] Suppose Wilwaukee Telecom offers its users the option of paying either (a) $2.00 per minute for telephone service or (b) a $125 flat charge for a year of unlimited toll-free calls. Consider a customer with an annual demand for telephone service of P = 11 – 0.1Q, where P is the price per minute and Q is the number of minutes of calls made per year. Calculate the consumer surplus for each of the plans (a) and (b).
Answer:
For plan A, P = 2.
Then from demand curve, 2 = 11-.1Q
So .1Q = 9
Q* = 90
B) under plan b, P = zero
So make 11 = .1Q
Q* = 110
Now Consumer surplus from a)
CS = .5*(11-2)*90 = ∆ABC
= .5*9*90 = 405
From b)
CS = .5*11*110 - 125 = ∆ ADE - fixed fee
= 605-125 = 480
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
Moto Win Auto Superstore is thinking about offering a two-year limited warranty for $978 on all new cars of a certain model. The terms of the warranty would be that Moto Win would replace the car free of charge under certain, specified conditions. Replacing the car in this way would cost MotoWin $16,300. Suppose that under the warranty, there is a 6% chance that Moto Win would have to replace the car one time and a 94% chance they wouldn't have to replace the car. If MotoWin knows that it will sell many of these warranties, should it expect to make or lose money from offering them? How much?
Answer:
they would expect to lose 58.68 dollars on each warranty visit.
Explanation:
We can use the following method to solve the given problem in the question;
Solution
Expected value for Motowin = $978*0.94 - $16300*0.06 = - $ 58.68
Hence, In the long run, they would expect to lose 58.68 dollars on each warranty visit.
We can use the following method to solve the given problem in the question;
Expected value for Motowin = $978*0.94 - $16300*0.06
Expected value for Motowin = - $ 58.68
Therefore, in the long run, they would expect to lose 58.68 dollars on each warranty visit.
Know more :
https://brainly.com/question/14970113?referrer=searchResults
Indicate whether each of the following is either True/Fasle:
1. An S Corporation is a taxpaying entity.
2. If shareholders elect S Corporation status, the corporation generally pays no tax.
3. Stock received by a transferor in exchange for services does not count in determining whether the 80% control test has been met.
4. Under Sec. 351, no gain or loss is recognized by those who exchange property solely for stock of the recipient corporation.
5. When boot is received by a taxpayer transferring assets in a Sec. 351 exchange, gain must be recognized to the extent of the smaller of the realized gain or the FMV of the boot received.
Answer:
The following are the answers,
False - S organization could be a taste unit which suggests all the financial gain of the S company are going to be relocated to stockholders and also the tax is to be compensated by the stockholders and not the S organization. True – As per constant rationalization on top of you'll be able to settle this. False – Stock acknowledged on either methodology are going to be enclosed for control purpose. True – The profit or loss is merely predictable once the transmission isn't for sole perseverance. True - When boot is acknowledged by a remunerator shifting possessions in a very Sec. 351 discussion, gain should be documented to the level of the lesser of the complete expansion
When I called about the cost of these items, it was implied that my total would only be $35.00
Answer:
Each Item Cost 11.6666667
Explanation:
35.00 / 3 = 11.6666667
So each item cost about 11.66 or 11.67
After a retiring from a successful business career, you would like to make a donation to your university. This donation will go into the school’s endowment pool and the returns generated from the donation will support the salary of a new professor in the business school on a perpetual basis. The university expects to earn returns of 5.5% on its endowment pool. You may assume that any distributions to support the salary will be made annually.
Part A) You can make a donation today (t=0) in the amount of $2,500,000. The first cash flow distribution from your donation to cover the professor's salary will take place in one year (at t=1). Which of the following is closest to the annual salary payment that can be made as a result of your donation?
A. $2,500,000
B. $454,545
C. $100,000
D. $137,500
Part B) After further discussions, the university determines that the employment agreement with the new professor will call for annual salary increases of 2%. Given this new requirement, and assuming the first salary distribution will still occur one year from today, what is the starting salary (at t=1) that can be supported with your $2,500,000 donation?
A. $50,000
B. $187,500
C. $140,250
D. $87,500
Answer:
Part A) D. $137,500
Part B) C. $140,250
Explanation:
Part A) The computation of annual salary payment is shown below:-
Annual salary = Donation made × Interest rate
= $2,500,000 × 5.5%
= $137,500
So, for computing the annual salary we simply multiply the donation made with interest rate.
Part B) The computation of starting salary is shown below:-
Starting salary = Annual salary + Increased annual salary
= $137,500 + 2%
= $140,250
Therefore for computing the starting salary we simply added the annual salary with increased annual salary.
aspela Corp. had the same capital structure in year 7 and year 8, consisting of the following: Preferred stock, $12 par, 5% cumulative, 20,000 shares issued and outstanding $ 240,000 Common stock, $6 par, 250,000 shares issued and outstanding 1,500,000 Caspela reported net income of $600,000 for year 8. No preferred dividends were paid during year 7, but Caspela paid $20,000 in preferred dividends in year 8. In its year 8 income statement what amount should Caspela report as basic earnings per share
Answer:
$2.35 per share
Explanation:
The computation of the earning per share is shown below:
Earning per share = (Net income - preference dividend) ÷ (Number of shares outstanding)
= ($600,000 - $12,000) ÷ (250,000 shares)
= $588,000 ÷ 250,000 shares
= $2.35 per share
The preference dividend is
= $240,000 × 5%
= $12,000
We simply applied the above formula
Alex Company prepares its statement of cash flows using the direct method for operating activities. For the year ended December 31, 2018, Alex Company reports the following activity: Sales on account $2,100,000 Cash sales 1,110,000 Decrease in accounts receivable 915,000 Increase in accounts payable 108,000 Increase in inventory 72,000 Cost of good sold 1,575,000 What is the amount of cash collections from customers reported by Alex Company for the year ended December 31, 2018
Answer:
The amount of cash collections from customers reported by Alex company for the year ended December 31, 2018 is $4,125,000.
Explanation:
Cash collection refers to the collection of cash from from an individual or a business whom invoice has been issued to. Any invoice unpaid are noted as being outstanding.
Cash collection fomular is therefore;
Cash collection = Sales on account + Cash sales + Decrease in accounts receivable
=$2,100,000 +$1,110,000 + $915,000
=$4,125,000
Under the allowance method of accounting for uncollectible accounts, a. the cash realizable value of accounts receivable is greater before an account is written off than after it is written off. b. Bad Debts Expense is debited when a specific account is written off as uncollectible. c. the cash realizable value of accounts receivable in the balance sheet is the same before and after an account is written off. d. Allowance for Doubtful Accounts is closed each year to Income Summary.
Answer:
c. the cash realizable value of accounts receivable in the balance sheet is the same before and after an account is written off.
Explanation:
Under the allowance method of accounting for uncollectible accounts, the cash realizable value of accounts receivable in the balance sheet is the same before and after an account is written off and bad debt expenses is debited.
This means that in the period in which an account previously written off is collected, the income is unaffected.
Also, under the allowance method of accounting, total assets will remain unchanged when a particular account is being written off.
A strategic business unit (SBU) refers to:_________.
a. a single product or service identification code used to identify items for strategic marketing planning purposes.
b. a small number of people from different departments in an organization who are mutually accountable to accomplish a task or common set of performance goals.
c. a strategic product that has a unique brand, size, or price. a privately-owned franchise under the auspices of a larger group or organization bearing the same name.
d. a subsidiary, division, or unit of an organization that markets a set of related offerings to a clearly defined group of customers.
Answer:
D.
Explanation:
Strategic Business unit is also popularly known as SBU. It is an independent entity of a large company. This entity have its own aims and visions, and operates individually but report its working to the headquarter. The aim of this entity is target market.
An example of SBU is Samsung. The company have different categories of product under one name. It is an electron company that makes phones, televisions, refrigators, camera, etc. All these sub-categories or divison of Samsung are SBU.
From the given options the correct one is D.
Determine whether each of the following events causes a shift of a curve or a movement along a curve in the short run. Indicate which curve is involved and the direction of the change. As a result of an increase in the value of the dollar relative to other currencies, American producers pay less in dollar terms for foreign steel, a major commodity used in production. This will cause a the aggregate curve to the .
Answer:
Check the explanation
Explanation:
Increase in value of dollar has made the foreign steel (a major commodity used in production) cheaper for American producers.
This will reduce the cost of production of American Producers and would increase their profit-margin.
This will induce US firms to produce more and therefore there will be increase in short-run aggregate supply.
So, the given scenario will involve short-run aggregate supply curve and would shift the curve to the right.
Kindly check the attached image below to see the required graph -
On December 31, 2017, Berclair Inc. had 560 million shares of common stock and 5 million shares of 9%, $100 par value cumulative preferred stock issued and outstanding. On March 1, 2018, Berclair purchased 168 million shares of its common stock as treasury stock. Berclair issued a 5% common stock dividend on July 1, 2018. Four million treasury shares were sold on October 1. Net income for the year ended December 31, 2018, was $1,050 million.
Also outstanding at December 31 were 30 million incentive stock options granted to key executives on September 13, 2013. The options were exercisable as of September 13, 2017, for 30 million common shares at an exercise price of $56 per share. During 2018, the market price of the common shares averaged $70 per share.
Required:
a. Compute Berclair's basic and diluted earnings per share for the year ended December 31, 2018.
Answer:
Basic Earnings Per Share = $1,44
Diluted Earnings Per Share = $1,38
Explanation:
Basic Earnings Per Share = Earnings Attributable to Holders of Common Stock / Weighted Average Number of Common Shares
Calculation of Earnings Attributable to Holders of Common Stock
Net income for the year ended December 31, 2018, $1,050,000,000
Less cumulative preferred stock dividend ($45,000,000)
Earnings Attributable to Holders of Common Stock $1,005,000,000
Calculation of Weighted Average Number of Common Shares
1 January Outstanding Common Shares 560,000,000
March 1 - Purchases (10/12×168,000,000) 140,000,000
October 1 - Sold (3/12×4,000,0000) (1,000,000)
Weighted Average Number of Common Shares 699,000,000
Basic Earnings Per Share = $1,005,000,000/699,000,000
= $1,44
Diluted Earnings Per Share = Adjusted Earnings Attributable to Holders of Common Stock / Adjusted Weighted Average Number of Common Shares
Calculation of Adjusted Weighted Average Number of Common Shares
Weighted Average Number of Common Shares (Basic) 699,000,000
Incentive Stock Options 30,000,000
Adjusted Weighted Average Number of Common Shares 729,000,000
Diluted Earnings Per Share = $1,005,000,000/ 729,000,000
= $1,38
Mr. Etemadi has prepared the following list of statements about service companies and merchandisers. Identify each statement as true or false.
1. Measuring net income for a merchandiser is conceptually the same as for a service company.
2. For a merchandiser, sales less operating expenses is called gross profit.
3. For a merchandiser, the primary source of revenues is the sale of inventory.
4. Sales salaries and wages is an example of an operating expense.
5. The operating cycle of a merchandiser is the same as that of a service company.
Answer:
Explanation:
1. Measuring net income for a merchandiser is conceptually the same as for a service company. TRUE
2. For a merchandiser, sales less operating expenses is called gross profit.
FALSE
For a merchandiser,sales subtracted from cost of goods sold is called gross profit.
3. For a merchandiser, the primary source of revenues is the sale of inventory.
TRUE
4. Sales salaries and wages is an example of an operating expense. TRUE
5. The operating cycle of a merchandiser is the same as that of a service company.
FALSE
A perpetual inventory system continuously leeps detailed records of the cost of the each purchase and sale. It shows the inventory that should be on hand for energy item.
In its first month of operations, Literacy for the Illiterate opened a new bookstore and bought merchandise in the following order: (1) 150 units at $7 on January 1, (2) 590 units at $8 on January 8, and (3) 890 units at $10 on January 29. M7-12 Calculating Cost of Goods Available for Sale, Cost of Goods Sold, and Ending Inventory under Periodic LIFO [LO 7-3] Assume 1,110 units are on hand at the end of the month, calculate the cost of goods available for sale, ending inventory, and cost of goods sold under the LIFO. Assume a periodic inventory system is used. (Round "Cost per Unit" to 2 decimal places.
Answer:
Goods available for sale = $14,670
Ending inventory = $9,470
Cost of goods sold = $5,200
Explanation:
As per the data given in the question,
Total units purchased = 150 + 590 + 890 = 1,630
Ending inventory = 1,110
Sales units = 1,630 units - 1,110 units = 520 units
Goods available for sale = 150 × $7 + 590 × $8 + 890 × $10
= $14,670
Ending inventory = 150 × $7 + 590 × $8 + 370 × $10
= $9,470
Cost of goods sold = $14,670 - $9,470
= $5,200
Movers Company manufactures sneakers. Production of its new sneakers for the coming three months is budgeted as follows: August 28,000 September 50,000 October 33,000 Each sneaker requires 2.5 hours of direct labor time. Direct labor wages average $16 per hour. Monthly variable overhead averages $10 per direct labor hour plus fixed overhead of $4,500. What is the total overhead budgeted for the month of September
Answer:
Budgeted overhead cost =$1,250,000
Explanation:
Budgeted overhead for the month of September = Total labour hours × overhead rate per hour
Total labor hours = standard hours × budgeted production units
=2.5 hours × 40,000= 125,000
Budgeted overhead cost Total = $10× 125,000 =$1250000
Budgeted overhead cost =$1,250,000
Answer:
$1,254,500
Explanation:
Solution
Recall that:
Production of sneakers for three months budgets were :
August= 28000
September = 50,000
October = 33,000
Each sneakers requires labor time = 2.5 hours
Labor wages average = $16.
Now,
The total overhead budgeted for the month of September is calculated as follows:
The total overhead budgeted for the month of September = Variable overhead + Fixed overhead
= (50,000 units * 2.5 direct labor hours per unit * $10 per direct labor hour) + $4,500
= $1,254,500
Therefore, the total overhead budgeted for the month of September is $1,254,500
Assume there is a decrease in the market demand for a good sold by price-taking firms that are initially producing the profit-maximizing level of output. How will the market adjust over time? Firms will exit the market, causing price to fall until positive profits are eliminated. Firms will exit the market, causing price to rise until losses are eliminated. Firms will enter the market, causing price to rise until losses are eliminated. Firms will enter the market, causing price to fall until positive profits are eliminated.
Answer: Firms will exit the market, causing price to rise until losses are eliminated
Explanation:
When there is a decrease in demand in a Perfectly Competitive Market, firms will have to start producing at a lower Quantity to manage their Marginal cost. This leads to Economic losses on their part in the short run.
In the long run however, should the situation remain the same, the new price would be less than their Average Cost which would deepen Economic losses. Firms would respond by exiting the market in the long run.
As the firms exit, the supply curve shifts left as supply drops. This drop in supply leads to a price rise. The exits will continue until enough firms leave that the market's remaining firms will stop suffering economic losses.
On June 30, 2021, Moran Corporation issued $13.5 million of its 8% bonds for $12.2 million. The bonds were priced to yield 10%. The bonds are dated June 30, 2021. Interest is payable semiannually on December 31 and July 1. If the effective interest method is used, by how much should the bond discount be reduced for the six months ended December 31, 2021?
Answer:
$70,000
Explanation:
Moran Corporation
Semiannual interest paid on 31 Dec 2021
= $13,500,000*8%*6/12
= $540,000
Therefore If the effective interest method is used, by how much should the bond discount be reduced for the six months ended December 31, 2021 will be $70,000
Effective interest expense on 31 Dec.2021
= $12,200,000 * 10% * 6/12
= $610,000
Bond discount to be reduced for 6 months ended 31 Dec 2021
= $610,000 - $540,000
= $70,000
On January 1, a company issued and sold a $408,000, 9%, 10-year bond payable, and received proceeds of $403,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The journal entry to record the first interest payment is:
Answer and Explanation:
The Journal entry is shown below:-
Bond interest expense Dr, $18,610
To Cash $18360
To Discount on bonds $250
(Being first interest payment is recorded)
For recording the first interest payment we simply debited the bond interest expenses as it increased the expenses and we credited cash and discount on bonds as it reduced the assets and the discount should be credited
Working Note
Total discount on bonds issued = Sold bonds - Received proceeds
= $408,000 - $403,000
= $5,000
Amortization of Semi Annual Discount = Total discount on bonds issued ÷ Number of periods
= $5,000 ÷ 20
= $250
Cash interest paid = Sold bonds × Interest rate × From Jan to June ÷ Total number of months in a year
= $408,000 × 9% × 6 ÷ 12
= $18,360
Total Interest expense = Cash interest paid + Amortization of Semi Annual Discount
= $18,360 + $250
= $18,610
