Ink Inc. has a capital structure consisting of 25 percent debt and 75 percent common equity financing. The company has $800 million in net income and plans to pay out 40 percent of their earnings as dividends. What is the maximum amount of new financing that the company can raise without selling new common stock?

Answers

Answer 1

Answer:

$640 million

Explanation:

The computation of maximum amount of new financing is shown below:-

New financing from equity = $800 million × (1 - 40%)

= $480 million

New financing from debt = $480 million ÷ 75% × 25%

= $160 million

Now the maximum amount of new financing is

= $480 million + $160 million

= $640 million

Hence, the maximum amount of new financing is $640 million


Related Questions

Answer this question on the basis of the given information for an economy in 2016.
Dollar value of resource extraction activity = $20 billion
Dollar value of production activity = $50 billion
Dollar value of distribution activity = $80 billion
Dollar value of final output = $110 billion
Suppose that in 2017, the dollar value of distribution activity fell to $70 billion, but the other values remained the same. Based on this, we could conclude that from 2016 to 2017,
A. neither GO nor GDP were affected by the change in distribution activity.
B. GO fell by $10 billion, while GDP was unchanged.
C. GDP fell by $10 billion, while GO was unchanged.
D. GO and GDP both fell by $10 billion.

Answers

Answer: B. GO fell by $10 billion, while GDP was unchanged.

Explanation;

Gross Output is different from GDP in that where GDP only takes into account the dollar value of the final output so as to avoid double counting, the Gross Output takes into account those intermediate expenses and consumption that were used to create the final goods and services.

As such, if the dollar value of distribution activity fell to $70 billion then the Gross Ouput would also have to fall by the equivalent amount which in this case would be $10 million.

As all other values did not change, then neither did the dollar value of final output meaning that GDP did not change.

Cost recovery. ​ Richardses' Tree​ Farm, Inc. purchased a new aerial tree trimmer for ​$. It is classified in the property class category of a​ single-purpose agricultural and horticultural structure. Then the company sold the tree trimmer after four years of service. If a​ seven-year life and​ MACRS, LOADING...​, was used for the depreciation​ schedule, what is the​ after-tax cash flow from the sale of the trimmer​ (use a ​% tax​ rate) if a. the sales price was ​$​? b. the sales price was ​$​? c. the sales price was ​$​? a. If the sales price is ​$​, what is the​ after-tax cash​ flow?

Answers

Answer:

after tax cash flow = $29,512.32

Explanation:

the numbers are missing in this question:

purchase cost = $82,000

tax rate = 40%

selling price at end of year 4 = $32,000

MACRS 7 year depreciation schedule:

year             %            depreciation expense         carrying value

1                  14.29%           $11,717.80                          $70,282.20

2                 24.29%          $19,917.80                        $50,364.40

3                 17.49%           $14,341.80                         $36,022.60

4                 12.49%           $10,241.80                        $25,780.80

after tax cash flow = $32,000 - [($32,000 - $25,780.80) x 40%] = $32,000 - $2,487.68 = $29,512.32

You are considering two mutually exclusive projects with the following cash flows. Which project(s) should you accept if the discount rate is 8.5 percent? What if the discount rate is 13 percent?Year 0 1 2 3Project A -80,000 31,000 31,000 31,000Project B -80,000 0 0 110,000

Answers

Answer:

NPV Project A = - $825.31

NPV Project B = $6119.89

So, at a discount rate of 8.5%, Project B should be accepted.

NPV Project A = - $6804

Npv Project B = - $3764.48

So, at a discount rate of 13%, neither of the projects should be accepted.

Explanation:

One of the methods to evaluate a project is to determine the NPV or Net Present Value from the project. If a project provides a positive NPV after discounting the cash flows from the project at a set discount rate, the project should be accepted. If the project gives a negative NPV, the project should be discarded.

The NPV is calculated as follows,

NPV = CF1 / (1+r)  +  CF2 / (1+r)^2 + ... + CFn / (1+r)^n - Initial cost

Where,

CF1, CF2, ... represents the cash flows in year 1 and year 2 and so onr is the discount rate

At 8.5% discount rate

NPV Project A = 31000/(1+0.085)  +  31000/(1+0.085)^2  +  31000/(1+0.085)^3 - 80000

NPV Project A = - $825.31

NPV Project B = 110000 / (1+0.085)^3  -  80000

NPV Project B = $6119.89

So, at a discount rate of 8.5%, Project B should be accepted.

At 13% discount rate

NPV Project A = 31000/(1+0.13)  +  31000/(1+0.13)^2  +  31000/(1+0.13)^3 - 80000

NPV Project A = - $6804

NPV Project B = 110000 / (1+0.13)^3  -  80000

Npv Project B = - $3764.48

So, at a discount rate of 13%, neither of the projects should be accepted.

The technique used to help strategic managers choose among alternative choices by defining the task environment, developing a set of various forecasts, and using pro forma financial statements is called________.
1. Decision trees.
2. SWOT analysis.
3. Industry scenarios.
4. CAPM [Capital Asset Pricing Model].

Answers

Answer:

Corporate scenarios is the right answer

Explanation:

The correct answer is not listed in the options. Corporate scenarios is the answer to the question.

Corporate scenarios can be said to be pro forma balance sheets and income statements which do the job of forecasing what the effect of individual alternative strategy and their different programs may likely have on the division and return on investment.

Therefore none is the answer

Journalize the following sales transactions for Salem Sportswear. Explanations are not required.

Aug. 1 Salem sold $69,000 of women's sportswear on account, credit terms of 3 / 10, n / 60. Cost of goods is $38,000.
5 Salem received a $3,500 sales return on damaged goods from the customer. Cost of goods damaged is $1 ,750.
10 Salem receives payment from the customer on the amount due, less the return and discount.

Journalize the sales transactions.

Aug 1 : Salem sold $69,000 of women's sportswear on account, credit terms of 3 / 10, n / 60. Cost of goods is S38,000.
Begin by preparing the entry to journalize the sale portion of the transaction.

Answers

Answer:

Aug. 1

Trade Receivable $69,000 (debit)

Cost of Sales  $38,000 (debit)

Sales Revenue $69,000 (credit)

Inventory  $38,000 (credit)

Aug 5

Sales Revenue  $3,500 (debit)

Inventory  $1 ,750 (debit)

Trade Receivable  $3,500 (credit)

Cost of Sales  $1 ,750 (credit)

Aug 10

Cash $63,535 (debit)

Discount allowed $1,965 (credit)

Trade receivable $65,500 (credit)

Explanation:

Aug 1

Recognize the Cost of Sale and the Assets of Trade Receivables.

Aug 5

De-recognize the Cost of Sales and Assets of Trade receivables to the extent of the goods that were returned.

Aug 10

Recognize the Cash Asset received less the cash discount of 3 % and also recognize the discount allowed expense to the amount of discount allowed.

1. Determine the total incremental cost of making 51,000 units of RX5. 2. Determine the total incremental cost of buying 51,000 units of RX5. 3. Should the company make or buy RX5

Answers

Answer with Explanation:

Requirement 1:

Incremental cost of making RX5:

Always remember that the direct costs are always incremental cost because these are the variable cost and will not be incurred if the decision is not taken related to making of the product RX5.

Incremental Cost of Making RX5:

Direct Material ($4 * 51,000 Units)                      $204,000

Direct Labor ($8 * 51,000 Units)                          $408,000

Variable Overheads ($9* 20% * 51,000 Units)     $91,800  

Total incremental cost of making 51000 units   $703,800

Requirement 2:

Incremental Cost of Buying RX5:

Purchase Cost ($19 per Unit * 51,000 Units) $969,000

The total incremental cost of making 51000 units is $969,000

Requirement 3:

The Cost of buying is higher than making RX5, hence the company should Make RX5.

Mullineaux Corporation has a target capital structure of 70 percent common stock, 5 percent preferred stock, and 25 percent debt. Its cost of equity is 11 percent, the cost of preferred stock is 5 percent, and the pretax cost of debt is 7 percent. The relevant tax rate is 35 percent. What is Mullineaux WACC

Answers

Answer:

Mullineaux Corporation

WACC (Weighted Average Cost of Capital):

WACC = (11% of 70%) + (5% of 5%) + (7% of 25%) (1 - 35%)

= 0.077 + 0.0025 + 0.0175(65%)

= 0.09087

= 9.1%

Explanation:

Target Capital Structure:

Common stock = 70%

Preferred stock = 5%

Debt = 25%

Total = 100%

Cost of:

Equity = 11%

Preferred stock = 5%

Debt (pretax) = 7%

Tax rate = 35%

Mullineaux's WACC is the weighted average cost of its capital sources, including equity and debt.  It means that Mullineaux Corporation has to weigh each class of capital based on their capital structure weights in order to calculate the average.  This WACC therefore represents the hurdle rate which a project must meet for Mullineaux Corporation to accept or reject the project.

You're evaluating the performance of your pension fund. You invested $100 initially, which grew to $106 after 4 months, and then to $107 after another 6 months.
a. What was your HPR during the first 4 months?b. What was your HPR during the next 5 months?c. What was your total HPR over the 9 months?

Answers

Answer:

a) the holding period return (HPR) for the first 4 months = ($106 - $100) / $100 = 6%

b) the holding period return (HPR) for the next 5 months = ($107 - $106) / $106 = 0.94%

c) the holding period return (HPR) for the 9 months period = ($107 - $100) / $100 = 7%

The holding period return measures the total return on an investment over a certain period of time. It does not necessarily calculate annual returns, since the holding period can be more or less than 1 year.  

If it is determined that your procurement scenario will not be conducted using full and open competition you are prohibited from purchasing a non-domestic product.
A. True
B. False

Answers

Answer:

Correct answer:

A. True

Explanation:

When procurement of goods and services is to be made from another country, it is expected that, it should be open and done in full view showing other competitors. This is to prevent fraud, such as the marking up of the price of goods or outright false declaration of the procurement prices.

A monopolistically competitive firmA. faces a downward-sloping demand curve and a steeper downward -sloping marginal revenue curve.B. faces a vertical demand curve and identical marginal revenue curveC. Produces a product that is undifferentiated by style, location, or qualityD. faces an upward-sloping demand curveE. faces a downward-sloping demand and a horizontal marginal revenue curve.

Answers

Answer:

Option A is correct.

Explanation:

Option A is correct because a monopolistically competitive firm has a downward-sloping demand curve and the marginal revenue curve is steeper than the demand curve that lies below the demand curve. Moreover, in this market, the product sold can be differentiated on the basis of quality. Further, in this market, the marginal cost curve first decreases then start increasing and cuts the marginal revenue curve.

Merry Maidens Cleaning generally charges $280 for a detailed cleaning of a normal-size home. However, to generate additional business, Merry Maidens is offering a new-customer discount of 10%. On May 1, Ms. E. Pearson has Merry Maidens clean her house and pays cash equal to the discounted price. Required: Record the revenue earned by Merry Maidens Cleaning on May 1.

Answers

Answer:

May 1

DR Cash $252

CR Service Revenue $252

(To record payment for services rendered)

Working

Cash = Net Service revenue

Net Service revenue = $280 * ( 1 - 10%)

= 280 * 90%

= $252

Miller Fruit wants to expand and needs $1.6 million to do so. Currently, the firm has 465,000 shares of stock outstanding at a market price per share of $32.50. The firm decided on a rights offering with one right granted for each share of outstanding stock. The subscription price is $28 a share. How many rights are needed to purchase one new share of stock in this offering?Miller Fruit wants to expand and needs $1.6 million to do so. Currently, the firm has 465,000 shares of stock outstanding at a market price per share of $32.50. The firm decided on a rights offering with one right granted for each share of outstanding stock. The subscription price is $28 a share. How many rights are needed to purchase one new share of stock in this offering?

Answers

Answer:

Rights needed for each new share = 8.14 rights

Explanation:

Amount needed to expand = $1.6 million

465,000 shares of stock outstanding at a market price per share of $32.50

The subscription price = $28

Number of rights issued = 1 right per share × 465,000 shares

Number of rights issued = 465,000 rights

Number of shares needed = $1,600,000 / $28

Number of shares needed = 57,142.857

Rights needed for each new share = Number of rights issued / Number of shares needed

Rights needed for each new share = 465,000 / 57,142.857

Rights needed for each new share = 8.14 rights

a firm learn that the own price of elasticity of a product it manufactures a 3.5 what would be the correct

Answers

Answer: Lower the price because demand for the good is elastic.

Explanation:

The good is elastic because the elasticity is more than 1. What this means is that when the price of the good is reduced by 1%, the demand of the good will increase by 3.5%.

If the company wishes to raise revenue therefore they should reduce their prices because more people would then buy the goods and the number of more sales would lead to higher revenue.

Builder and Owner agree that Builder will erect a fence for Owner for $1,500. Builder claims that the fence is taking longer than Builder expected, so Owner must pay Builder $500 more or Builder will not complete the fence. Owner, needing the fence completed, agrees to the additional $500. Builder completes the fence. Owner owes Builder: ________.
A. $1,500.
B. $2,000.
C. $1,000.
D. $1,750.

Answers

Answer:

Owner owes Builder : B. $2,000.

Explanation:

A Liability is the present obligation of the entity, that arises as a result of past events, the settlement of which is expected to result in a cash outflow from the entity.

Initially, the Owners owes the Builder $,1500

For the fence to be completed on time, an addition of $500 was owed, upon the owner accepting this arrangement.

Thus, the total obligation owing to the Builder is $2,000.

Answer:

2000

Explanation:

Because 1500+500=2000

What is a commodity?

Answers

The correct answer is D. Something of value that can be bought, sold, or traded

Explanation:

The word "commodity" is used in economics to refer to any good or product that has an economic value and due to this, can be part of the market. This means any commodity can be traded, sold, or bought. Moreover, this concept is mainly applied to raw materials such as coal, timber, or wheat that can be used to make other manufactured products such as plastics, furniture, or flour. According to this, the option that correctly describes the word commodity is option D.

Answer:

D. Something of value that can be bought, sold, or traded

Which of the following is NOT one of the four levels of culture? A. Profit B. artifacts C. espoused values D. enacted values

Answers

Answer:

A. Profit

Explanation:

Culture is the shared characteristics and knowledge of a group of people that affects different aspects of their lives like language, religion, social traits, arts, and music.

Levels of culture are:

- Artefacts: these are physical manifestation of a culture like dress code, office allocation, awards, and ceremonies.

- Assumptions: are unconscious alignment with expected behaviour.

- Espoused value: these are stated values to be adhered to

- Enacted values: behaviours that are exhibited as a guide to others in a group

​Company's budgeted prices for direct​ materials, direct manufacturing​ labor, and direct marketing​ (distribution) labor per​ attaché case are $39​, $7​, and $12​, respectively. The president is pleased with the following performance​ report:

Actual Costs Static Budget Variance
Direct materials 564,000 $400,000 $36,000 F
Direct manufacturing labor 78,000 80 2,000 F
Direct marketing (distribution) labor 110,000 120,000 10,000F


Actual output was 9,100 ​attaché cases. Assume all three​ direct-cost items above are variable costs.

Requirement:
a. Is the​ president's pleasure​ justified?
b. Prepare a revised performance report that uses a flexible budget and a static budget.

Answers

Answer:

a) The president's pleasure is not justified because the budget performance was unfavorable in all the variable costs.

b) Revised Flexible Performance Report

                                                             Flexible        Actual         Variance

                                                             Budget        Costs

Direct materials                                $354,900    $564,000    $209,100 U

Direct manufacturing labor                  63,700         78,000         14,300 U

Direct marketing (distribution) labor 109,200         110,000             800 U

                                                           Flexible        Static            Variance

                                                             Budget       Budget

Direct materials                                $354,900    $400,000       $45,100 U

Direct manufacturing labor                  63,700         80,000         16,300 U

Direct marketing (distribution) labor 109,200        120,000         10,800 U

Explanation:

a) Data and Calculations:

                                                        Actual Costs  Static Budget   Variance

Direct materials                                 564,000      $400,000      $36,000 F

Direct manufacturing labor                 78,000          80,000           2,000 F

Direct marketing (distribution) labor 110,000         120,000         10,000 F

b) Budgeted Prices:

Direct materials = $39

Direct labor = $7

Direct marketing labor = $12

Actual Output = 9,100

Flexible Budget:

Direct materials = $354,900 ($39 x 9,100)

Direct labor = $63,700 ($7 x 9,100)

Direct marketing labor = $109,200 ($12 x 9,100)

The flexible budget for direct materials, labor and marketing were flexed in line with actual output.

You find a zero coupon bond with a par value of $10,000 and 14 years to maturity. The yield to maturity on this bond is 5.1 percent. Assume semiannual compounding periods. What is the price of the bond

Answers

Answer:

Bond Price = $4940.8468 rounded off to $4940.85

Explanation:

The price of a zero coupon bond is simply calculated by calculating the present value of the face value of the bond that the bond pays at maturity. The formula for the price of a zero coupon bond is,

Bond Price = Face Value / ( 1 + r )^n

Where,

r is the rate or YTM n is the number of periods left to maturity

Assuming that the r or YTM is always stated in annual terms, the semi annual YTM will be 5.1% / 2 = 2.55%

Assuming semi annual compounding periods, the total number of periods or n will be,

n = 14 * 2 = 28

Bond Price = 10000 / (1 + 0.0255)^28

Bond Price = $4940.8468 rounded off to $4940.85

Pizza sells an average of pizzas per​ week, of which ​% are​ single-topping pizzas and ​% are supreme pizzas with multiple toppings. Singles sell for each and incur variable costs of . Supremes sell for each and incur variable costs of . The contribution margin per unit and total contribution margin for Singles and Supremes are

Answers

Answer:

the question is incomplete, so I looked for a similar question:

"Pizza sells an average of 150 pizzas per week, of which 20% are single-topping pizzas and 80% are supreme pizzas with multiple toppings. Singles sell for $8 each and incur variable costs of $2. Supremes sell for $12 each and incur variable costs of $6."

contribution margin for Singles = $8 - $2 = $6

contribution margin ratio for Singles = $6 / $8 = 75%

total contribution margin for Singles = $6 x 150 x 20% = $180

contribution margin for Supremes = $12 - $6 = $6

contribution margin ratio for Supremes = $6 / $12 = 50%

total contribution margin for Supremes = $6 x 150 x 80% = $720

On October 10, the stockholders' equity of Sherman Systems appears as follow:

Common stock—$10 par value, 85, 000 shares authorized, issued, and outstanding $720,000
Paid—in capital in excess of par value, common stock 216,000
Retained earnings 864,000
Total stockholders' equity $1,800,000

1. Prepare journal entries to record the following transactions for Sherman Systems.
a. Purchased 6,300 shares of its own common stock at $38 per share on October 11.
b. Sold 1,325 treasury shares on November 1 for $44 cash per share.
c. Sold all remaining treasury shares on November 25 for $33 cash per share.

2. Explain how Sherman's equity section changes after the October 11 treasury stock purchase, and prepare the revised equity section of its balance sheet at that date.

Answers

Answer:

Sherman Systems

1. Journal Entries:

a. October 11:

Debit Treasury Stock $63,000

Debit Paid-in In Excess of Par $176,400

Credit Cash Account $239,400

To record the purchase of 6,300 shares at $38 per share.

b. November 1:

Debit Cash Account $58,300

Credit Treasury Stock $13,250

Credit Paid-in In Excess of Par $45,050

To record the resale of 1,325 treasury shares for $44

2. Sherman's equity section will reduce by $239,400 after the October 11 purchase of treasury stock with a direct reduction of $63,000 in the outstanding shares value and the balance in the Paid-in In Excess of Par account:

Revised Equity section as at October 11:

Stockholders' Equity

Common stock—$10 par value,

85, 000 shares authorized

Issued                                $720,000

less Treasury Stock           -$63,000

Outstanding                                      $657,000

Paid—in capital in excess of par

value, common stock        216,000

less Treasury Stock            176,400    39,600

Retained earnings                             864,000

Total stockholders' equity           $1,560,600

Explanation:

a) Data and Calculations:

Stockholders' Equity

Common stock—$10 par value,

85, 000 shares authorized

Issued and outstanding                $720,000

Paid—in capital in excess of par

value, common stock                     216,000

Retained earnings                          864,000

Total stockholders' equity        $1,800,000

b) Sherman Systems can choose from two methods on how to record its Treasury Stock transactions.  One method is the costing method that records every transaction in the Treasury Stock and the par value method which records the differences in the par value for Treasury Stock in the Paid-in In Excess of Par account.

Which one of the following statements is correct concerning the concept of materiality?

a. Materiality is determined by reference to guidelines established by the AICPA.
b. Materiality depends only on the dollar amount of an item relative to other items in the financial statements.
c. Materiality depends on the nature of an item rather than the dollar amount.
d. Materiality is a matter of professional judgement.

Answers

Answer:

D) Materiality is a matter of professional judgement

Explanation:

A mortgage is paid off in 30 years with a total of $124,000. It had a 2% interest rate that compounded monthly. What was the principal

Answers

Answer:

the Principle, PV on the mortgage was $68,086.64.

Explanation:

The Principle on the mortgage, PV is determined as follows :

FV = $124,000

N = 30 × 12 = 360

P/ yr = 12

PMT = $0

R = 2%

PV = ?

Using a Financial Calculator, the Principle, PV on the mortgage was $68,086.6399 or $68,086.64.

In the short run, increasing marginal costs always imply increasing average total costs. a. Trueb. False

Answers

Answer:

The answer is A. True.

Explanation:

Marginal Cost is the cost of producing one more product unit.

Marginal Cost = Average Total Cost / Average Goods Output

Therefore, in the short run, an increase in Marginal Cost implies a similar increase in Average Total Cost.

Facial Cosmetics provides plastic surgery primarily to hide the appearance of unwanted scars and other blemishes. During 2021, the company provides services of $402,000 on account. Of this amount, $52,000 remains uncollected at the end of the year. An aging schedule as of December 31, 2021, is provided below.
Age Group Amount Estimated Percent
Receivable Uncollectible
Not yet due $ 32,000 4 %
0-30 days past due 10,200 6 %
31–60 days past due 7,200 12 %
More than 60 days past due 2,600 30 %
Total $ 52,000
Required:
1. Calculate the allowance for uncollectible accounts.
2. Record the December 31, 2021, adjustment, assuming the balance of Allowance for Uncollectible Accounts before adjustment is $400 (debit).
3. On April 3, 2022, a customer’s account balance of $500 is written off as uncollectible. Record the write-off.
4. On July 17, 2022, the customer whose account was written off in requirement 3 unexpectedly pays $100 of the amount but does not expect to pay any additional amounts. Record the cash collection.

Answers

Answer: Please see explanation for answers

Explanation:

Age Group            Amount           Estimated Percent     Estimated  Amount

                              Receivable      Uncollectible                 Uncollectible

Not yet due             $ 32,000              4 %                          $1,280

0-30 days past due 10,200                 6 %                          $612  

31–60 days past due 7,200                 12 %                        $864

More than 60 days past due 2,600      30 %                      $780

Total                                  $ 52,000                                    $3536

Calculation

1) Estimated Amount Uncollectible = Amount Receivable x Estimated Percent      Uncollectible    =

4% x 32,000= $1,280

6% x 10,200=$612

12% x 7,200=$864

30% x2600=$780

Total = $3,536

The allowance for uncollectible accounts = $3,536

2) Journal to  Record the December 31, 2021, adjustment for a debit of $400

Estimated Amount Uncollectible =$3,536

Adjusted = $3536 + debit $400=$3,936

Date                   Account                  Debit             Credit

Dec 31, 2021,  Bad debts Expense    $3,936

Allowance for uncollectible accounts                    $3,936

3) Journal to  Record the write-off of $500

Date                   Account                              Debit             Credit

April 3, 2022,  Allowance for uncollectible

                             accounts                             $500

                         Accounts receivable                                     $500

4a)Journal to  reinstate  the account previously wrtten off  On July 17, 2022

Date                   Account                              Debit             Credit

July 17, 2022,   Accounts receivable             $100

Allowance for uncollectible  accounts                             $100

4b)Journal to record collection of cash  

Date                   Account                              Debit             Credit

July 17, 2022,   Cash                                    $100

     Accounts receivable                                                     $100

                                                                                                                   

A Journal Entry refers to simply a summary of the debits and also credits of the transaction entry to the Journal. When A Journal entries are important to the transaction because they allow us to sort our transactions into manageable data.

Age Group            Amount         Estimated Percent     Estimated  Amount

                            Receivable     Uncollectible                 Uncollectible

Not yet due             $ 32,000               4 %                          $1,280

0-30 days past due  10,200                   6 %                          $612  

31–60 days past due 7,200                  12 %                        $864

More than 60 days past due 2,600       30 %                      $780

                                                                                                             

Total                                 $ 52,000                                   $3536

The formula apply  Then we Estimated the Amount Uncollectible is =

Amount Receivable x Estimated Percent *Uncollectible   =

4% x 32,000=                 $1,280

6% x 10,200=                   $612

12% x 7,200=                   $864

30% x2600=                    $780

Then the Total is =          $3,536

The allowance for uncollectible accounts = $3,536

                                                                                                                       

Journal Entry

2) Journal to  Record the December 31, 2021, adjustment for a debit of $400

Estimated Amount Uncollectible =$3,536

Adjusted = $3536 + debit $400=$3,936

Date                   Account                  Debit             Credit

Dec 31, 2021,  Bad debts Expense    $3,936

Allowance for uncollectible accounts                    $3,936

                                                                                                         

3) Journal to  Record the write-off of $500

Date                   Account                             Debit            Credit

April 3, 2022,  Allowance for uncollectible

                            accounts                             $500

                        Accounts receivable                                     $500

4a)Journal to  reinstate  the account previously written off  On July 17, 2022

Date                   Account                              Debit             Credit

July 17, 2022,   Accounts receivable             $100

Allowance for uncollectible  accounts                            $100

                                                                                                                 

4b)Journal entry to the record collection of cash  

Date                   Account                              Debit             Credit

July 17, 2022,   Cash                                    $100

    Accounts receivable                                                     $100

Find out more information about Journal entry here:

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"13. In Laura’s new role at Walden-Martin Family Medical Clinic, she will be writing checks to take care of the accounts payable for the clinic. A practicum student has just started at the clinic and will be working with Laura for the next several days. How should Laura describe this aspect of her job? "

Answers

Laura characterizes her employment as "trusting" because she will be working with Laura in the accounting office for the next few days.

When rumors of future layoffs or closures circulate, transparency keeps employees from leaving.

There are five components to performing a work, according to the explanation:

1. Be respectful.

The first of the five characteristics is respect, which has the most weight with your staff.

2. Salary and Benefits

This employment feature has risen in importance since 2012, when it was ranked third. It is the only significant aspect of the job having a monetary value.

3. Have faith in yourself.

When rumors of future layoffs or closures circulate, transparency keeps employees from leaving.

Learn more:

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Glacier Trails manufactures backpacks for adventurers. The backpacks come in two types: Daytripper, and Excursion. Glacier anticipates the following sales volumes for the coming period:
Daytripper: 2,000 backpacks
Excursion: 1.200 backpacks
If total budgeted revenue for the period is $250,000 and the sales price for Daytripper backpacks is $50, what is the budgeted sales price for Excursion backpacks?
a. $ 78.
b. $125.
c. $5130.
d. $158.
e. none of the above.

Answers

Answer:

the budgeted sales price for Excursion backpacks is b. $125.

Explanation:

Total Budgeted Revenue = Daytripper Budgeted Revenue + Excursion Budgeted Revenue

Therefore,

Let the budgeted sales price for Excursion backpacks be $y

$250,000 = 2,000 ×  $50 + 1.200 × $y

$150,000 = $1,200 y

$125 = y

Therefore, the budgeted sales price for Excursion backpacks is $125.

Prepare the journal entry to record Jevonte Company’s issuance of 35,000 shares of its common stock assuming the shares have a: $3 par value and sell for $22 cash per share. $3 stated value and sell for $22 cash per share.

Answers

Answer: Please see answer in explanation column

Explanation:

a)journal entry to record Jevonte Company’s issuance at $3 par value and $22 cash per share

Account                                            Debit                        Credit

Cash(35,000 x $22)                       $770,000

Common stock, $3 par value(35,000 x 3)                       $105, 000

Paid-in captial in excess of par value, common stock

($770,000  - $105, 000 )                                                      $665,000

b)journal entry to record Jevonte Company’s issuance at $3 stated  value and $22 cash per share

Account                                            Debit                        Credit

Cash  (35,000 x $22)                    $770,000

Common stock, $3 stated value (35,000 x 3)                 $105, 000

Paid-in captial in excess of stated value, common stock

($770,000  - $105, 000 )                                                      $665,000

Donna, age 42 and a single taxpayer, has a salary of $104,500 and interest income of $20,000. What is the maximum amount Donna can contribute to a Roth IRA

Answers

Answer:

$5,800

Explanation:

Using 2020 limits:

Donna's AGI = $124,500 (interest income is taxed as ordinary income)

since Donna's is $500 higher than the income threshold for single taxpayers ($124,000), then her contribution to a Roth IRA is reduced by $200.

If Donna's AGI was less than $124,000, she could have contributed up to $6,000 (which is the maximum contribution allowed). Her contribution limit starts to reduce by $200 for every $500 or fraction in excess of the income threshold limit. The contribution limit phases out completely when the AGI is $139,000.

E.g. If Donna's AGI was $125,000, her contribution limit = $5,600

The following data were taken from the balance sheet of Nilo Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $655,500 $546,000 Marketable securities 759,000 614,300 Accounts and notes receivable (net) 310,500 204,700 Inventories 1,039,500 674,100 Prepaid expenses 535,500 430,900 Total current assets $3,300,000 $2,470,000 Current liabilities: Accounts and notes payable (short-term) $435,000 $455,000 Accrued liabilities 315,000 195,000 Total current liabilities $750,000 $650,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place.

Answers

Answer:

1. Previous Year =  $1,820,000, Current Year = $2,550,000

2. Previous Year = 3.80 times , Current Year = 4.40 times

3. Previous Year = 2.70 times,  Current Year = 3.00 times

Explanation:

working capital = current assets - current liabilities

working capital (Previous Year) = $2,470,000 - $650,000

                                                    = $1,820,000

working capital (Previous Year) = $3,300,000 - $750,000

                                                    = $2,550,000

Current ratio = current assets ÷ current liabilities

working capital (Previous Year) = $2,470,000 ÷ $650,000

                                                    = 3.80 times

working capital (Previous Year) = $3,300,000 ÷ $750,000

                                                    = 4.40 times

Quick ratio = (current assets - inventory) ÷ current liabilities

working capital (Previous Year) = ($2,470,000 - 674,100) ÷ $650,000

                                                    = 2.70 times

working capital (Previous Year) = ($3,300,000 - 1,039,500) ÷ $750,000

                                                    = 3.00 times

                   

FIFO Perpetual Inventory

The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:

Date Transaction Number
of Units Per Unit Total
Apr. 3 Inventory 48 $150 $7,200
8 Purchase 96 180 17,280
11 Sale 64 500 32,000
30 Sale 40 500 20,000
May 8 Purchase 80 200 16,000
10 Sale 48 500 24,000
19 Sale 24 500 12,000
28 Purchase 80 220 17,600
June 5 Sale 48 525 25,200
16 Sale 64 525 33,600
21 Purchase 144 240 34,560
28 Sale 72 525 37,800
Required:

1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.

Dunne Co.
Schedule of Cost of Goods Sold
FIFO Method
For the Three Months Ended June 30
Purchases Cost of Goods Sold Inventory
Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost
Apr. 3 $ $
Apr. 8 $ $
Apr. 11 $ $
Apr. 30
May 8
May 10
May 19
May 28
June 5
June 16
June 21
June 28
June 30 Balances $ $
2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account.

Record sale
Record cost
3. Determine the gross profit from sales for the period.
$

4. Determine the ending inventory cost as of June 30.
$

5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower?

Answers

Answer:

Dunne Co.

Schedule of Cost of Goods Sold

FIFO Method

For the Three Months Ended June 30

                                          Purchases      Cost of Goods Sold Inventory

Date            Description    Quantity    Unit Cost       Total Cost   Sales

Apr. 3          Inventory         48                $150             $7,200

Apr. 8          Purchase         96                  180              17,280

Apr. 11         Sale                           64        500                             32,000

Apr. 30       Sale                           40        500                             20,000

May 8         Purchase         80                 200             16,000

May 10       Sale                           48        500                             24,000

May 19       Sale                           24        500                             12,000

May 28      Purchase         80                  220            17,600

June 5       Sale                          48         525                             25,200

June 16      Sale                         64         525                             33,600

June 21      Purchase      144                  240            34,560

June 28     Sale                         72         525                             37,800

June 30     Total            448   360                         $92,640 $184,600

June 30     Balances       88                 $240          $21,120      

2. Determination of total sales and cost of goods sold and Journal Entries:

Debit Accounts Receivable $184,600

Credit Sales Revenue $184,600

To record the sales of goods on account for the period.

Debit Cost of Goods Sold $92,640

Credit Inventory $92,640

To record the cost of goods sold for the period.

3. Income Statement for determining the gross profit:

Sales Revenue       $184,600

Cost of goods sold $92,640

Gross profit             $91,960

4. Determination of the ending inventory cost of June 30:

Ending Inventory units = 88

Cost per unit (FIFO) = $240

Total =                     $21,120

5. The ending inventory would be lower if the ending inventory was valued using the Last-in, First-out (LIFO) method.  The purchase price was increasing instead.  Using LIFO means that ending inventory would be valued at the cost of the purchases in earlier months because of the assumption with LIFO that goods sold are from the last purchases instead of the earlier purchases.

Explanation:

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