Answer: 920
Explanation:
Since the transaction took place in November, we should note that revenue should be recognized for 2 months by Taylor.
The amount that Taylor should recognize as revenue in 2018 will be:
= 5520/12 × 2
= 460 × 2
= 920
An Argentinian economist pointed out that the inflation rate based on the PCE(personal consumption expenditures) deflator was higher than the inflation rate you calculated in part (b) based on the GDP deflator. Provide two possible explanations for this difference between the inflation rates calculated from the PCE deflatorversus the GDP deflator.
Answer:
Note: The complete question is attached as picture below
Year Nominal GDP Real GDP
2019 100 100
2020 105 99
a) %change in nominal GDP = [(105 - 100) / 100] * 100 = 5%
%change in real GDP = [(99 - 100) / 100] * 100 = -1%
b) GDP deflator is = [Nominal GDP / Real GDP]. %change in GDP deflator = [(106.06 - 100) / 100] * 100 = 6.06%
c) Inflation calculated from GDP deflator and PCE is different because
- GDP deflator does not includes price increase of imported goods while PCE does.
- PCE measures change in price of goods which are generally consumed by consumers while GDP deflator includes all goods produced in an economy.
What happens to your employer-sponsored retirement plan if you decide to change employers?
Answer:
Most 401 (k) or IRA accounts allow employees to roll-over their accounts from the old employer to the new employer. Depending on the account and how much time you have been making contributions, you could also cash your retirement account, but that would mean starting from zero with the new employer.
Answer:
a). You may roll your money over to a new plan through your new employer.
b) You can withdraw the money from your plan in one lump sum and pay income taxes and likely a penalty as well.
c) You can leave the money in the plan with your former employer.
answer is correct
d) All of the above
Explanation:
The chart below gives prices and output information for the country of Utopia. Use this information to calculate real and nominal GDP for both years. Use 2001 as the base year.
Year 2000 2001
Price Quantity Price Quantity
Ice Cream $7.00 600 $3.00 400
Blue Jeans $70.00 20 $20.00 90
Laptops $300.00 5 $300.00 5
2000 nominal GDP = $_________
2001 nominal GDP = $_________
2000 real GDP = $_________
2001 real GDP = $_________
Answer and Explanation:
The computation is shown below:
As we know that
Nominal GDP = Sum of (Present Year Price × Present Year Quantity)
And,
Real GDP = Sum of (Base Year Price × Present Year Quantity)
Now
(a) Nominal GDP, 2000 is
= $[(7 × 600) + (70 × 20) + (300 × 5)]
= $4,200 + $1,400 + $1,500
= $7,100
(b) Nominal GDP, 2001 is
= $[(3 × 400) + (20 × 90) + (300 × 5)]
= ($1,200 + $1,800 + $1,500)
= $4,500
(c) Real GDP, 2000 is
= $[(3 × 600) + (20 × 20) + (300 × 5)]
= $1,800 + $400 + 1,500
= $3,700
(d) Real GDP, 2001 is
= $[(3 × 400) + (20 × 90) + (300 × 5)]
= $1,200 + $1,800 + $1,500
= $4,500
Suppose the United States is currently producing 100tons of hamburgers and 45tons of tacos and Mexico is currently producing 20tons of hamburgers and 25tons of tacos. If the United States and Mexico each specialize in producing only one good (the good for which each has a comparative advantage), then a total of nothingadditional ton(s) of hamburgers can be produced for the two countries combined (enter a numeric response using an integer)
Answer: 50 additional tons of hamburgers
Explanation:
United States opportunity costs:
Hamburger opportunity cost = 45/100 = 0.45 tons of tacos
Taco opportunity cost = 100/45 = 2.22 tones of hamburgers
Mexico opportunity cost:
Hamburger opportunity cost = 25/20 = 1.25 tons of tacos
Taco opportunity cost = 20/25 = 0.8 tones of hamburgers
US should specialize in Hamburger production because they have a lower opportunity cost.
If both countries combined production of hamburgers then the total would be:
= 100 + 20
= 120 tons of hamburgers
There is missing information on this question which is the US production of hamburgers when it produces 0 tacos. We shall assume that number to be 170 tons of hamburgers.
The total additional tons produced would be:
= US tons when producing only hamburgers - Combined hamburger production
= 170 - 120
= 50 additional tons of hamburgers
On January 1 of the current reporting year, Coda Company's projected benefit obligation was $30 million. During the year, pension benefits paid by the trustee were $4 million. Service cost was $10 million. Pension plan assets earned $5 million as expected. At the end of the year, there was no net gain or loss and no prior service cost. The actuary's discount rate was 10%. Required: Determine the amount of the projected benefit obligation at December 31.
Answer:
The amount of projected benefit obligation is on Dec 31 is $39 million
Explanation:
The computation of the amount of projected benefit obligation is on Dec 31 as follows;
Beginning PBO $30 million
Service cost $10 million
Interest cost (10% × $30) $3 million
Loss (gain) on PBO $0
Less: benefits paid -$4 million
Ending PBO $39 million
Hence, the amount of projected benefit obligation is on Dec 31 is $39 million
Kenny, Inc., is looking at setting up a new manufacturing plant in South Park. The company bought some land six years ago for $7.7 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent facilities elsewhere. The land would net $10.5 million if it were sold today. The company now wants to build its new manufacturing plant on this land; the plant will cost $21.7 million to build, and the site requires $920,000 worth of grading before it is suitable for construction. What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project
Answer:
$33,120,000
Explanation:
Calculation for What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project
Using this formula
Proper Cash Flow Amount = (Expected Cost of Selling + Cost of Building Manufacturing Plant + Cost of Grading)
Let plug in the formula
Proper Cash Flow Amount = ($10,500,000 + $21,700,000 + $920,000)
Proper Cash Flow Amount = $33,120,000
Therefore the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project will be $33,120,000
These are selected 2017 transactions for Flounder Corporation: Jan. 1 Purchased a copyright for $110, 750. The copyright has a useful life of 5 years and a remaining legal life of 33 years. Mar. 1 Purchased a patent with an estimated useful life of 6 years and a legal life of 20 years for $138, 600. Sept. 1 Purchased a small company and recorded goodwill of $153, 350. Its useful life is indefinite.
Prepare all adjusting entries at December 31 to record amortization required by the events. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Answer and Explanation:
The adjusting journal entries are as follows:
On Dec 31
Amortization expense $22,150 ($110,750 ÷ 5 years)
To Copyrights $22,150
(Being amortization expense is recorded)
Here amortization expense is debited as it increased the expenses and credited the copyrights as it decreased the assets
On Dec 31
Amortization expense $19,250 ($38,600 ÷ 6 years × 10 ÷ 12)
To Patents $19,250
(Being amortization expense is recorded)
Here amortization expense is debited as it increased the expenses and credited the patents as it decreased the assets
On Dec 31
No journal entry is required
Stephenson Company's computer system recently crashed, erasing much of the company's financial data. The following accounting information was discovered soon afterwards on the CFO's back-up computer data.
Cost of Goods Sold $380,000
Work-in-Process Inventory, Beginning 30,000
Work-in-Process Inventory, Ending 40,000
Selling and Administrative Expense 50,000
Finished Goods Inventory, Ending 15,000
Finished Goods Inventory, Beginning ?
Direct Materials Purchased 171,000
Factory Overhead Applied 112,000
Operating Income 22,000
Direct Materials Inventory, Beginning 18,000
Direct Materials Inventory, Ending 6,000
Cost of Goods Manufactured 340,000
Direct Labor 55,000
The CFO of Stephenson Company has asked you to recalculate the following accounts and report to him by week's end.
What should be the amount of direct materials used?
a. $208,400
b. $405,500
c. $440,800
d. $201,500
Answer:
Direct material used= $183,000
Explanation:
Giving the following information:
Direct Materials Purchased 171,000
Direct Materials Inventory, Beginning 18,000
Direct Materials Inventory, Ending 6,000
To calculate the direct material used, we need to use the following formula:
Direct material used= beginning inventory + purchases - ending inventory
Direct material used= 18,000 + 171,000 - 6,000
Direct material used= $183,000
Prove:
cost of goods manufactured= beginning WIP + direct materials + direct labor + allocated manufacturing overhead - Ending WIP
cost of goods manufactured= 30,000 + 183,000 + 55,000 + 112,000 - 40,000
cost of goods manufactured= $340,000
Esquire Company needs to acquire a molding machine to be used in its manufacturing process. Two types of machines that would be appropriate are presently on the market. The company has determined the following:
Machine A could be purchased for $60,500. It will last 10 years with annual maintenance costs of $2,100 per year. After 10 years the machine can be sold for $6,050.
Machine B could be purchased for $55,000. It also will last 10 years and will require maintenance costs of $8,400 in year three, $10,500 in year six, and $12,600 in year eight. After 10 years, the machine will have no salvage value.
Required:
Assume an interest rate of 8% properly reflects the time value of money in this situation and that maintenance costs are paid at the end of each year.
Answer:
Esquire should purchase Machine A.
Explanation:
Note: The requirement of this question is not complete. The complete requirement is therefore presented before answering the question as follows:
Required:
Assume an interest rate of 8% properly reflects the time value of money in this situation and that maintenance costs are paid at the end of each year. Ignore income tax considerations.
Calculate the present value of Machine A & Machine B. Which machine Esquire should purchase? (Negative amounts should be indicated by a minus sign. Do not round intermediate calculations. Round your final answers to nearest whole dollar amount.)
Explanation of the answer is now given as follows:
Note: See the attached excel file for the calculations of the present value of Machine A & Machine B.
In the attached excel file, the following is used:
Discounting factor = 1 / (1 + r)^n ……………………………. (1)
Where:
r = interest rate = 8%, or 0.08
n = the year in focus
From part 1 of the attached excel file, we have:
Net present value of Machine A = -$71,788.85
From part 2 of the attached excel file, we have:
Net present value of Machine B = -$75,092.36
Since the Net present value of Machine A of -$71,788.85 is less than the Net present value of Machine B of -$75,092.36, Esquire should purchase Machine A.
Longmire & Sons made sales on credit to Alderman Sports totaling $500,000 on April 18. The cost of the goods sold is $400,000. Longmire estimates 3% of its sales to Alderman may be returned. On May 22, $9,000 worth of goods (with a cost of $7,200) are returned by Alderman. Assume Longmire uses a perpetual inventory system.
Required:
Prepare the related journal entries for Longmire & Sons.
Answer:
April 18
Dr Account receivable 500,000
Cr Cash 500,000
April 18
Dr Cost of goods sold 400,000
Cr Merchandize inventory 400,000
May 22
Dr Sales return and allowance 9,000
Cr Account receivable 9,000
May 22
Dr Merchandize inventory 7,200
Cr Cost of goods sold 7,200
Explanation:
Preparation of the related journal entries for Longmire & Sons.
Based on the information given the related journal entries for Longmire & Sons will be :
April 18
Dr Account receivable 500,000
Cr Cash 500,000
(Being to record credit sales)
April 18
Dr Cost of goods sold 400,000
Cr Merchandize inventory 400,000
(Being to Record cost of goods sold)
May 22
Dr Sales return and allowance 9,000
Cr Account receivable 9,000
(Being to record goods return)
May 22
Dr Merchandize inventory 7,200
Cr Cost of goods sold 7,200
(Being to Record cost of goods return)
An insurance company accepts an obligation to pay 10,000 at the end of each year for 2 years. The insurance company purchases a combination of the following two bonds at a total cost of X in order to exactly match its obligation: 1-year 4% annual coupon bond with a yield rate of 5% 2-year 6% annual coupon bond with a yield rate of 5% Calculate X.
Answer:
$18,594.10
Explanation:
Insurance company has to pay $10,000 for two year with rate of 5% since market rate remain same in both the bond.
X = PV (PMT, N, I/Y)
X = PV(10000, 2, 5)
X = 18594.1043
X = $18,594.10
The ABC Lawn Company aims for a high number of clients that result in high profits. To meet its goal ABC markets its landscaping service vigorously because there are many lawn services and nurseries in the local community. As a sales-oriented company, ABC focuses on _______.
Answer:
Agressive trading technique
Explanation:
A Sales Orientation company is a company that capitalizes or dwell on selling its products and services rather than satisfying their customers wants or needs. Due to the fact that sales orientation business is bent on pushing their product out to the customer it use or employ aggressive techniques in its handling, and this will cost or involves intensive promotions and price- strategy.
Aggressive trading shoulders more risk and thereafter may be accepting a big loss.
Data pertaining to the postretirement health care benefit plan of Danielson Delivery Service include the following for the current calendar year: Service cost $ 150,000 APBO, January 1 $ 800,000 Plan assets (fair value), January 1 $ 80,000 Prior service cost (current year amortization, $2,000) $ 90,000 Retiree benefits paid (end of year) $ 90,000 Net gain (current year amortization, $1,000) $ 92,000 Contribution to health care fund (end of year) $ 85,000 Return on plan assets (actual and expected) 10 % Discount rate 8 % Required: 1. Determine Danielson's postretirement benefit expense for the current year.
Answer: $207,00
Explanation:
Postretirement benefit for the year is:
= Service cost + Interest cost + Amortization of prior service cost - Return on plant assets - Amortization of net gain
Interest cost = Discount rate * Actual Projected benefit obligation (APBO)
= 8% * 800,000
= $64,000
Return on plant assets = Return on plan assets (actual and expected)* Plan assets
= 10% * 80,000
= $8,000
Postretirement benefit = 150,000 + 64,000 + 2,000 - 8,000 - 1,000
= $207,000
In 2008, Betserai was a 10-year-old quintrillionaire living in Bulawayo, Zimbabwe. He was literally rolling in money. In fact, Betserai has so much money that he decided to make kites out of billion dollar bills instead of putting the money into the bank to earn interest. None of Betserai's friends bothered to save their money, either. Rupert was Betserai's American pen pal and heard of Betserai's story and was extremely confused. He was taught that Zimbabwe was one of the poorer countries in the world, or at the least substantially poorer than the United States. Which statement best explains this phenomenon?
A. A country's wealth is based on the amount of money in circulation.
B. Zimbabwe was in the midst of an incredible economic boom, substantially increasing the wealth of all its citizens.
C. Rapid rises in price levels made the Zimbabwean dollar near worthless in terms of purchasing power.
D. All of these statements could explain what happened in Zimbabwe in 2008.
Answer:
C. Rapid rises in price levels made the Zimbabwean dollar near worthless in terms of purchasing power.
Explanation:
As in the given situation it is mentioned that 10 year old boy has the bill of billion dollar this represented that the country really printed the bill of billion dollar. It means that the attempt is to be done in order to print a currenct note of higher denomination that also represent that the country would increased such level also at the same time a big amount is required to purchased the goods and services.
Also the high denomination values would not consist of actual value as they have purchasing power i.e. negligible
Classical economists believe that the producer can produce more of the product at the same price. the economy was never at full employment of resources. the economy is approaching full employment as wages and prices increase. the economy will adjust to at full employment of resources. there are many unemployed resources.
Answer:
the economy will adjust to full employment of resources.
Explanation:
Of course, that was one of the primary views of classical economists such as J.B. Say and Alfred Marshal.
They held that it was possible to do what many modern economists would call the impossible: full employment, One where the economy uses its resources to the full.
Consider Pacific Energy Company and U.S. Bluechips, Inc., both of which reported earnings of $967,000. Without new projects, both firms will continue to generate earnings of $967,000 in perpetuity. Assume that all earnings are paid as dividends and that both firms require a return of 13%.
A. What is the current PE ratio for each company?
B. Pacific Energy Company has a new project that will generate additional earnings of $117,000 each year in perpetuity. Calculate the new PE ratio of the company.
C. Atlantic Energy has a new project that will increase earnings by $217,000 in perpetuity. Calculate the new PE ratio of the firm.
Answer and Explanation:
The computation is shown below:
a. Current PE ratio is
For Pacific energy company
= Price ÷ Earnings
= ($967,000 ÷ 0.13) ÷ ($967,000)
= 7.69 times
For U.S Bluechips
= Price ÷ Earnings
= ($967,000 ÷ 0.13) ÷ ($967,000)
= 7.69 times
b. The new PE ratio is
= Price ÷ Earnings
= (($967,000 + $117,000) ÷ 0.13) ÷ ($967,000)
= 8.62 times
c. The new PE ratio is
= Price ÷ Earnings
= (($967,000 + $217,000) ÷ 0.13) ÷ ($967,000)
= 9.42 times
Rubbermaid allows employees to spend a percentage of their working time on special projects. Imagine that, as a manager for Rubbermaid, you have the difficult job of choosing employees for your project team. You have limited positions, and because your team is among the most celebrated at the company, you have more volunteers than roles available. What is the best way to control the conflict
Answer:
Hire an external consultant to pick new team members for you
Explanation:
On the given scenario there are limited project spaces and plenty of volunteers for those positions.
An equitable and impartial method of choosing team members needs to be used to avoid conflict.
The best solution is to hire an external consultant who can be seen as impartial to do the selection.
This way employees will accept the objectivity of the selection since the external consultant does not have any underlying.interest in who occupies the project positions
Parks Corporation is considering an investment proposal in which a working capital investment of $10,000 would be required. The investment would provide cash inflows of $2,000 per year for six years. The working capital would be released for use elsewhere when the project is completed. If the company's discount rate is 10%, the investment's net present value is closest to (Ignore income taxes.): Click here to view Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.
Answer:
$4,355.26
Explanation:
The net present value is the present value of future cash flows expected from the project minus the initial investment outlay
initial investment outlay=working capital investment = -$10,000
Years 1-5 cash inflow=$2,000
Year 6 cash inflow=normal cash inflows+release of working capital
Year 6 cash inflow=$2,000+$10,000=$12,000
the present value of a future cash flow=cash flow/(1+r)^n
n is 1 for year cash inflow 2 for year 2 cash inflow, 3 for year 3 cash inflow and so on
NPV=-$10,000+$2,000/(1+10%)^1+$2,000/(1+10%)^2+$2,000/(1+10%)^3+$2,000/(1+10%)^4+$2,000/(1+10%)^5+$12,000/(1+10%)^6
NPV=$4,355.26
A T-bill quote sheet has 90-day T-bill quotes with a 5.77 ask and a 5.71 bid. If the bill has a $10,000 face value, an investor could sell this bill for _____.
a. $9,857.25
b. $9,855.75
c. $9,859.21
d. $10,000
Answer:
a. $9,857.25
Explanation:
Price = Face value * (1 - Bid*Days/360)
Price = $10,000 * (1 - 5.71%*90/360)
Price = $10,000 * (1 - 5.71%*0.25)
Price = $10,000 * (1 - 0.014275)
Price = $10,000 * 0.985725
Price = $9,857.25
Emilio’s accountant told him that if he continues to pay $50 a month on his credit card, it will take him 42 years to pay off his current balance (assuming the interest rate doesn’t change and assuming he doesn’t charge anything else on that card). His credit card interest rate is 18.99%. What is his balance?
Answer:
$3,158.40
Explanation:
The current balance on his credit card is the present value of $50 payable per month over 42-year period as shown below:
PV=monthly payment*(1-(1+r)^-n/r
PV=the unknown
montly paymet=$50
r=monthly interest rate= 18.99%/12=0.015825
n=number of monthly payments=42*12=504
PV=$50*(1-(1+0.015825)^-504/0.015825
PV=$50*(1-(1.015825)^-504/0.015825
PV=$50*(1-0.000365827)/0.015825
PV=$50*0.999634173/0.015825
PV=$3,158.40
Manufacturing activities consist of materials, production, and sales activities. The materials activity consists of the purchase and issuance of materials to production. The production activity consists of converting materials into finished goods. At this stage in the process, the materials, labor, and overhead costs have been incurred and the schedule of cost of goods manufactured is prepared. The sales activity consists of selling some or all of finished goods available for sale. At this stage, the cost of goods sold is determined.
From the list below, select the items that are classified as a materials activity.
a. Raw materials used
b. Raw materials beginning inventory
c. Raw materials purchases
d. Work in process beginning inventory
e. Goods manufactured
f. Direct labor used
g. Factor overhead used
Answer:
a. Raw materials used
b. Raw materials beginning inventory
c. Raw materials purchases
Explanation:
Note: The materials activity consists of the purchase and issuance of materials to production
Thus, the items that are classified as a materials activity are :Raw materials used, Raw materials beginning inventory and Raw materials purchases
Analyze the role individual team members and leaders play in ensuring or detracting from team success. In the analysis, considering the advantages and disadvantages of the team effectiveness model (Exhibit 7.2). For example, what would be some of the effective and ineffective individual and leadership behaviors regarding team environmental, design, process, and effectiveness practices
The correct answer to this open question is the following.
Unfortunately, you did not attach the team effectiveness model (Exhibit 7.2). You did not a link or picture of it.
However, trying to help you, we can comment on the following model.
We are going to use the Katzenbach and Smith Team Model.
This team effectiveness model has three important components at the base of the pyramid: collective work product, commitment, and personal growth.
From there, the next level indicates the specific goals of the team, the ground rules, the common approach, and the meaningful purpose of the team.
Going up the pyramid we have the Skills and Accountability.
In the Skills, the authors include interpersonal skills, technical skills, and problem-solving abilities. Regarding Accountability, the authors include mutual and personal accountability.
At the very top of the pyramid, we have the performance results.
This model helps to establish the foundation of the role individual team members and leaders play in ensuring team success.
For this to happen, leaders have to set the example of the n¿behavior they like to observe on team members. On the other hand, setting that example, team members are expected to follow through with the goals and expectations, following high standards of performance to accomplish goals.
Compare and by converting their income statements to common size. Martinez Rojo Net sales. . . . . . . . . . . . . . . . . . . . . . . . . . . $10,900 $19,536 Cost of goods sold. . . . . . . . . . . . . . . . . . 6,660 14,203 Other expense. . . . . . . . . . . . . . . . . . . 3,564 4,356 Net income. . . . . . . . . . . . . . . . . . . . . . . . . $676 $977 Which company earns more net income? Which company's net income is a higher percentage of its net sales?
Answer:
a. Rojo
b. Martinez
Explanation:
When converting the income statement to common size, everything is made a percentage of net sales.
Martinez Rojo
Net Sales 100% 100%
Cost of goods sold (61.1% ) ( 72.7%)
Other expenses (32.7% ) ( 22.3%)
Net Income 6.2% 5.0%
Working
Martinez Rojo
Cost of goods 6,660/10,900 14,203/19,536
Other expenses 3,564/10,900 4,365/19,536
Net income 676/10,900 977/19,536
a. Company with more Net income
= Rojo
b. Company with higher net income as percentage of net sales
= Martinez
A Student table and an Address table contain one linked record. What kind of table relationship do these tables
demonstrate?
a. one-to-one
b. one-to-many
c. many-to-many
d. many-to-none
Answer:
A.)
Explanation:
hope this helps
Below are several transactions that took place in Seneca Company last year: Paid suppliers for inventory purchases. Bought equipment for cash. Paid cash to repurchase its own stock. Collected cash from customers. Paid wages to employees. Equipment was sold for cash. Common stock was sold for cash to investors. Cash dividends were declared and paid. A long-term loan was made to a supplier. Income taxes were paid to the government. Interest was paid to a lender. Bonds were retired by paying the principal amount due. Required: Indicate how each of the above transaction would be classified on a statement of cash flows. As appropriate, place an X in the Operating, Investing, or Financing column. Also, place an X in the Cash Inflow or Cash Outflow column.
Answer:
Note: Operating = A, Investing = B, Financing = C, Cash Inflow column = D, Cash Outflow column = E
A B C D E
a. Paid suppliers for inventory X X
purchases.
b. Bought equipment for cash. X X
c. Paid cash to repurchase its X X
own stock.
d. Collected cash from customers. X X
e. Paid wages to employees. X X
f. Equipment was sold for cash. X X
g. Common stock was sold for X X
cash to investors.
h. Cash dividends were declared X X
and paid.
i. A long-term loan was made to X X
a supplier.
j. Income taxes were paid to X X
the government.
k. Interest was paid to a lender. X X
l. Bonds were retired by paying X X
the principal amount due
Lupo Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on the following data: Total machine-hours 31,500 Total fixed manufacturing overhead cost $ 220,500 Variable manufacturing overhead per machine-hour $ 6.00 Recently, Job T687 was completed with the following characteristics: Number of units in the job 10 Total machine-hours 40 Direct materials $ 685 Direct labor cost $ 1,370 If the company marks up its unit product costs by 40% then the selling price for a unit in Job T687 is closest to: (Round your intermediate calculations to 2 decimal places.)
Answer:
$2575
Explanation:
Total variable overhead estimated=(6*31,500)= $189,000
Hence total overhead estimated=Total variable overhead estimated+Total fixed overhead estimated = $189,000 + $220,500 = $409,500
Hence, predetermined overhead rate = $409,500 / 31,500 = $13 per machine hour
Hence, total overhead applied=(13*400) = $520
Hence, total job cost=Direct material+Direct labor+Total overhead = $685 + $1,370 + $520 = $2575
Binder Corporation agreed to build a warehouse for a client at an agreed contract price of $4,000,000. Expected (and actual) costs for the warehouse follow: 2017, $640,000; 2018, $1,600,000; and 2019, $800,000. The company completed the warehouse in 2019. Compute net income for each year 2017 through 2019 using the cost-to-cost method. a. 2017: $200,000 2018: $520,000 2019: $240,000 b. 2017: $640,000 2018: $1,600,000 2019: $800,000 c. 2017: $0 2018: $0 2019: $960,000 d. 2017: $320,000 2018: $320,000 2019: $320,000
Answer:
The correct option is a. 2017: $200,000 2018: $520,000 2019: $240,000.
Explanation:
The formula for cost to cost method is expected or actual cost incurred to date divided by the total cost of the project or contract.
Therefore, we have:
Total cost = Cost in 2017 + Cost in 2018 + Cost in 2019 = $640,000 + $1,600,000 + $800,000 = $3,040,000
Cost in 2017 contribution to total cost = Cost in 2017 / Total cost = $640,000 / $3,040,000 = 0.21
Cost in 2018 contribution to total cost = Cost in 2018 / Total cost = $1,600,000 / $3,040,000 = 0.53
Cost in 2019 contribution to total cost = Cost in 2019 / Total cost = $800,000 / $3,040,000 = 0.26
Revenue in 2017 = Cost in 2017 contribution to total cost * Contract price = 0.21 * $4,000,000 = $840,000
Revenue in 2018 = Cost in 2018 contribution to total cost * Contract price = 0.53 * $4,000,000 = $2,120,000
Revenue in 2019 = Cost in 2019 contribution to total cost * Contract price = 0.26 * $4,000,000 = $1,040,000
Therefore, net income for each year 2017 through 2019 using the cost-to-cost method can be computed as follows:
Net income for year 2017 = Revenue in 2017 - Cost in 2017 = $840,000 - $640,000 = $200,000
Net income for year 2018 = Revenue in 2018 - Cost in 2018 = $2,120,000 - $1,600,000 = $520,000
Net income for year 2019 = Revenue in 2019 - Cost in 2019 = $1,040,000 - $800,000 = $240,000
Therefore, the correct option is a. 2017: $200,000 2018: $520,000 2019: $240,000.
Answer:
Eet
Explanation:
On December 31, 2019, Wintergreen, Inc., issued $150,000 of 7 percent, 10-year bonds at a price of 93.25. Wintergreen received $139,875 when it issued the bonds (or $150,000 x .9325). After recording the related entry, Bonds Payable had a balance of $150,000 and Discounts on Bonds Payable had a balance of $10,125. Wintergreen uses the straight-line bond amortization method. The first semiannual interest payment was made on June 30, 2020.
Complete the necessary journal entry for June 30, 2020, by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Answer:
Dr Bond Interest Expense$5,756
Cr Cash $5,250
Discount on bond payable $506
Explanation:
Preparation of the necessary journal entry for June 30, 2020
Based on the information given the necessary journal entry for June 30, 2020 will be :
Dr Bond Interest Expense$5,756
($5,250 + $506 = $5,756)
Cr Cash $5,250
($150,000 x 7% x 1/2 = $5,250)
Discount on bond payable $506
($10,125/20 interest Periods = $506)
Note that in a situation where a 10-year bonds pay interest semiannually, what we would have will be 20 interest periods
Great Harvest Bakery purchased bread ovens from New Morning Bakery. New Morning Bakery was closing its bakery business and sold its two-year-old ovens at a discount for $700,000. Great Harvest incurred and paid freight costs of $35,000, and its employees ran special electrical connections to the ovens at a cost of $5,000. Labor costs were $37,800. Unfortunately, one of the ovens was damaged during installation, and repairs cost $5,000. Great Harvest then consumed $900 of bread dough in testing the ovens. It installed safety guards on the ovens at a cost of $1,500 and placed the machines in operation.
Prepare a schedule showing the amount at which the ovens should be recorded in Great Harvest's Equipment account.
Answer:
Particulars Amount
Purchase price $700,000
Add: Freight cost $35,000
Add: Electrical connections $5,000
Add: Labor costs $37,800
Add: Bred dough used $900
Add: Safety guards $1,500
Total cost of Equipment $780,200
Note: Repairs cost of $5,000 will not be included
During Year 3, Rex Co. introduced a new product carrying a 2-year assurance-type warranty against defects. The estimated warranty costs related to dollar sales are 2% within 12 months following sale and 4% in the second 12 months following sale. Sales and actual warranty expenditures for year ended December 31, Year 3 and Year 4, are as follows:
Year Sales Actual Warranty Expenditures
2008 $250,000 $2,250
2009 250,000 7,500
Total $500,000 $9,750
What amount should Gum report as estimated warranty liability on its December 31, 2009 balance sheet?
Answer:
the amount that should reported as the estimated liability is $20,250
Explanation:
The computation of the amount that should reported as the estimated liability is as follows:
= Total sales × total percentage - total actual warranty expenditure
= $500,000 × 6% - $9,750
= $30,000 - $9,750
= $20,250
Hence, the amount that should reported as the estimated liability is $20,250
