Answer:
Variable overhead rate variance $1,050 unfavorable
Explanation:
Variable overhead rate variance is the difference between the standard variable overhead cost allowed for the actual hours worked and the actual variable overhead incurred for the period
$
470 hours should have cost (470× $ 5.00) 2,350
but did cost 3,400
Variable overhead rate variance 1050 unfavorable
Variable overhead rate variance $1,050 unfavorable
At its date of incorporation, Sheffield Corp. issued 111000 shares of its $10 par common stock at $13 per share. During the current year, Sheffield acquired 21000 shares of its common stock at a price of $18 per share and accounted for them by the cost method. Subsequently, these shares were reissued at a price of $14 per share. There have been no other issuances or acquisitions of its own common stock.
What effect does the reissuance of the stock have on the following accounts?
Retained Earnings Additional Paid-in Capital
Answer:
Retained Earnings decreases by $84,000
There would be a no effect in the Additional Paid-in Capital
Explanation:
The journal entry to record the retained eaning would be as follows:
Debit Credit
Cash $294,000
Retained earnings $84,000
Treasury stock $378,0000
Retained Earnings decreases by $84,000
Cash= 21,000 shares*14=$294,000
Retained earnings=21,000 shares*(18-14) =$84,000
Treasury stock=21,000 shares*18=$378,0000
There would be a no effect in the Additional Paid-in Capital
So Retained Earnings decreases by $84,000
Breckenridge Ski and Snow Board Rental Co. charges 67 for a one day rental. At that price they average renting 159 sets of apparatus. Their yield management consultant recommended they lower their price to 56. At that price the consultant expects their average daily rental will be 205 sets of apparatus. At those prices and demand, what elasticity of demand can be expected? (Solve to two decimal places.)
Answer:
Price elasticity of demand = 1.76
Explanation:
Price elasticity of demand (PED) is the degree of responsiveness of demand to a change in price.
Where a percentage change in price produces a more than a proportional change in quantity, we say the product is price elastic. On the other hand, where a change in price produces a less than a proportional change in quantity demand, then demand is price inelastic
PED is computed as follows:
PED = % change in quantity /% change in Price
% change in demand = (56- 67)/67 × 100 = 28.93081761
% change in price =16.41791045
PED = 28.93/16.4179 = 1.762
Price elasticity of demand = 1.76
Balser Corporation manufactures and sells a number of products, including a product called JYMP. Results for last year for the manufacture and sale of JYMPs are as follows: Sales $ 960,000 Less expenses: Variable production costs $ 464,000 Sales commissions 144,000 Salary of product manager 100,000 Fixed product advertising 160,000 Fixed manufacturing overhead 132,000 1,000,000 Net operating loss $ (40,000 ) Balser is trying to decide whether to discontinue the manufacture and sale of JYMPs. All expenses other than fixed manufacturing overhead are avoidable if the product is dropped. None of the fixed manufacturing overhead is avoidable. Assume that dropping Product JYMP would result in a $90,000 increase in the contribution margin of other products. If Balser chooses to discontinue JYMP, the annual financial advantage (disadvantage) of eliminating this product should be:
Answer:
$2,000 disadvantage
Explanation:
The computation of the annual financial advantage or disadvantage of eliminating the product is shown below:
Sales $960,000
Less Variable production costs ($464,000)
Less Sales commission ($144,000)
Less salary of product manager ($100,000)
Less fixed product advertising ($160,000.00)
Less contribution margin from other products ($90,000)
Income from JYMP 2,000.00
This is the financial disadvantage for eliminating the product of $2,000 so the company should continue to manufactured the JYMP
And the fixed cost is not considered here as it is not relevant because it has fixed in nature does not have create any impact whether company should manufactured the product or not
Bob, Kara, and Mark are partners in the BKM Partnership. Bob is a 40% partner and has a June 30 tax yearminus−end. Kara owns a 40% interest in the partnership and has a September 30 tax yearminus−end, and Mark owns the remaining 20% interest and has an October 31 tax yearminus−end. The partnership does not have a natural business year. What is the required tax yearminus−end for the partnership (if no Sec. 444 election is made)? A. September 30 B. October 31 C. December 31 D. June 30
Answer:
D. June 30
Explanation:
Since no Sec. 444 election is made, the required tax yearmius-end for the partnership will be the tax yearminus−end of a partner with at least 40% interest.
Since Bob is a 40% partner and has a June 30 tax yearminus−end, therefore, the required tax yearminus−end for the partnership is June 30.
Using the following accounts and an overhead rate of 140% of direct labor cost, compute the amount of applied overhead. Work in Process Inventory Beginning WIP 35,100 Direct materials 57,200 Direct labor ? Factory Overhead ? To Finished Goods 213,300 Ending WIP 25,100 Finished Goods Inventory Beginning FG 5,100 Cost of Goods Mfg'd 213,300
Answer:
$85,225
Explanation:
The computation of the applied overhead is shown below:
Let us assume that the Direct labor be X
And, the factory overhead be 1.4X
As we know that
Cost of goods manufactured = Beginning work in process + direct material + direct labor + factory overhead - ending work in process
$213,300 = $35,100 + $57,200 + X + 1.4X - $25,100
$213,300 = $67,200 + 2.4X
$146,100 = 2.4X
X = $60,875
And, the factory overhead is
= $60,875 × 1.4
= $85,225
hence, the applied overhead is $85,225
Which factors are relevant to the time a consumer spends looking at a product on the shelf prior to selection? The article "Effects of Base Price Upon Search Behavior of Consumers in a Supermarket" (J. Econ. Psycho., 2003: 637-652) reported the following data on elapsed time (sec) for fabric softener purchasers and washing-up liquid purchasers; the former product is significantly more expensive than the latter. These products were chosen because they are similar with respect to allocated shelf space and number of alternative brands. Calculate a 90% confidence interval for the true difference between the means for the two products.
Answer:
Shown below.
Explanation:
In this case we need to compute a 90% confidence interval for the true difference between the mean elapsed time (sec) for fabric softener purchasers and washing-up liquid purchasers.
It is provided that these products were chosen because they are similar with respect to allocated shelf space and number of alternative brands.
The (1 - α)% confidence interval for the true difference between the means, when the population standard deviations are not known, is given as follows:
[tex]CI=(\bar x_{1}-\bar x_{2})\pm t_{\alpha/2, (n_{1}+n_{2}-2)}\times S_{p}\times\sqrt{\frac{1}{n_{1}}+\frac{1}{n_{2}}}[/tex]
Here,
[tex]\bar x_{1}=\text{sample mean for fabric softener purchasers}\\\bar x_{2}=\text{sample mean for washing-up liquid purchasers}\\S_{p}=\text{pooled standard deviation}[/tex]
The formula to compute the value of [pooled standard deviation is:
[tex]S_{p}=\sqrt{\frac{(n_{1}-1)s_{1}^{2}+(n_{2}-1)s_{2}^{2}}{n_{1}+n_{2}-2}}[/tex]
The Sandhill Hotel opened for business on May 1, 2022. Here is its trial balance before adjustment on May 31. SANDHILL HOTEL Trial Balance May 31, 2022 Debit Credit Cash $ 2,463 Supplies 2,600 Prepaid Insurance 1,800 Land 14,963 Buildings 71,200 Equipment 16,800 Accounts Payable $ 4,663 Unearned Rent Revenue 3,300 Mortgage Payable 37,200 Common Stock 59,963 Rent Revenue 9,000 Salaries and Wages Expense 3,000 Utilities Expense 800 Advertising Expense 500 $114,126 $114,126 Other data: 1. Insurance expires at the rate of $360 per month. 2. A count of supplies shows $1,070 of unused supplies on May 31. 3. (a) Annual depreciation is $3,000 on the building. (b) Annual depreciation is $2,400 on equipment. 4. The mortgage interest rate is 6%. (The mortgage was taken out on May 1.) 5. Unearned rent of $2,510 has been earned. 6. Salaries of $860 are accrued and unpaid at May 31. (a) (b) (c) (d1) (d2) (d3) (e)
Answer:
1. Journalize the adjusting entries on May 31:
Debit Credit
1. Insurance Expense $360
Insurance Prepaid $360
To record insurance expense for the month.
2. Supplies Expense $1,530
Supplies Account $1,530
To record supplies expense for the month.
3a. Depreciation Expense - Building $250
3b. Depreciation Expense - Equipment $200
Accumulated Depreciation - Building $250
Accumulated Depreciation - Equipment $200
To record depreciation charge for the month.
4. Mortgage Interest Expense $186
Mortgage Interest Payable $186
To accrue mortgage interest, 6% for 1 month.
5. Unearned Rent Revenue $2,510
Rent Revenue $2,510
To record rent earned.
6. Salaries & Wages Expense $860
Salaries & Wages Payable $860
To accrue salaries at May 31.
2. Prepare a ledger using the three-column form of account. Enter the trial balance amounts into the balance column and then post the adjusting entries:
No. Description Debit Credit Balance
1. Prepaid Insurance:
As per Trial Balance $1,800
Insurance Expense $360 $1,440
Insurance Expense:
Prepaid Insurance $360 $360
2. Supplies Account:
As per Trial Balance $2,600
Supplies Expense $1,530 $1,070
Supplies Expense:
Supplies Account $1,530 $1,530
3a. Depreciation Exp. - Building $250 $250
Accumulated Deprec-Building $250 $250
3b. Depreciation Exp.- Equipment $200 $200
Accumulated Depre- Equipment $200 $200
4. Mortgage Interest Expense $186 $186
Mortgage Interest Payable $186 $186
5. Unearned Rent:
As per Trial Balance $3,300
Rent Revenue $2,510 $790
Rent Revenue:
As per Trial Balance $9,000
Unearned Rent $2,510 $11,510
6. Salaries & Wages Expense:
As per Trial Balance $3,000
Salaries & Wages Payable $860 $860
Salaries & Wages Payable:
Salaries & Wages Expense $860 $860
3. Prepare an adjusted trial balance on May 31, 2022:
Debit Credit
Cash $2,463
Supplies 1,070
Supplies Expense 1,530
Prepaid Insurance 1,440
Insurance Expense 360
Depreciation - Building 250
Depreciation - Equipment 200
Accumulated Depr-Building 250
Accumulated Depr-Equipment 200
Mortgage Interest Expense 186
Mortgage Interest Payable 186
Land 14,963
Buildings 71,200
Equipment 16,800
Accounts Payable $ 4,663
Unearned Rent Revenue 790
Mortgage Payable 37,200
Mortgage Interest Exp 186
Mortgage Interest Payable 186
Common Stock 59,963
Rent Revenue 11,510
Salaries and Wages Expense 3,860
Salaries & Wages Payable 860
Utilities Expense 800
Advertising Expense 500
$115,808 $115,808
4. Prepare an income statement for the month of May:
Rent Revenue $11,510
Expenses:
Supplies $1,530
Insurance 360
Salaries & Wages 3,860
Utilities Expense 800
Advertising Expense 500
Depreciation:
Building 250
Equipment 200
Mortgage Interest 186 (7,686)
Net Income $3,824
5. Prepare an owner’s equity statement for the month of May:
Common Stock $59,963
Retained Earnings 3,824
Total Equity $63,787
6. Prepare a balance sheet at May 31:
Assets:
Cash $2,463
Supplies 1,070
Prepaid Insurance 1,440
Land 14,963
Buildings 71,200
Equipment 16,800
Total Assets $107,936
Liabilities + Equity:
Accounts Payable $4,663
Unearned Rent Revenue 790
Mortgage Interest Payable 186
Salaries & Wages Payable 860
Accumulated Depreciation:
Building 250
Equipment 200
Mortgage Payable 37,200
Common Stock 59,963
Retained Earnings 3,824
Total Liabilities +Equity $107,936
Explanation:
a) Adjusting entries are end-of-the-period journal entries used to recognize income or expenses that occurred but are not accurately displayed in your records. They are made to comply with the accrual concept and the matching principle, which demand that expenses and income should matched to the period they were incurred, whether paid for or not.
b) The three-sided ledger accounts show the debit, credit, and balance columns. This means that it shows the balance per transaction of any particular account.
c) Mortgage interest is calculated as (6% of $37,200)/12, so as to accrue for one month only. Other expenses are calculated for one month only.
c. Assume that neither country experiences population growth or technological progress and that 6 percent of capital depreciates each year. Assume further that country A saves 15 percent of output each year and country B saves 23 percent of output each year. Using your answer from part b and the steady-state condition that investment equals depreciation, find the steady-state level of capital per worker (k∗) , income per worker (y∗) , and consumption per worker (c∗) for each country.
Answer:
Check Explanation.
Explanation:
Note that the production function of bother country = Y=F(K,L) = K L c : k^1/2 L^1/2.
Thus Y/L = b; b = k^1/2 L^1/2/ L.
b = k^1/2.
From the question we are given that L = 6% = 0.06.
Country A saves 15% = 15/100 = 0.15 and country B saves 23% = 23/100 = 0.23.
For country A,
(a). the steady state;
∆k = 0 = y - dk.
0 = 0.15 × k^1/2 - 0.06k.
K^1/2 = 2.5, k* = 6.25
(b). y = K^1/2 = (6.25)^1/2.
y* = 2.5
(c). C = 2.5 - (0.15 × 2.5) = 2.5 - 0.375.
C* = 2.125.
Then, for COUNTRY B.
(a). ∆k = 0 = y - dk.
0 = 0.25 × k^1/2 - 0.06k.
K^1/2 = 4.167, k* = 17.36
(b). y = K^1/2 = (17.36)^1/2.
y* = 4.167.
(c). C = 4.167 - (0.25 × 4.167) = 2.5 - 0.375.
C* = 3.127.
C* = 2.125.
Here are the comparative income statements of Cullumber Corporation. CULLUMBER CORPORATION Comparative Income Statement For the Years Ended December 31 2022 2021 Net sales $639,400 $578,200 Cost of goods sold 464,800 433,400 Gross Profit 174,600 144,800 Operating expenses 70,500 43,000 Net income $ 104,100 $ 101,800 (a) Prepare a horizontal analysis of the income statement data for Cullumber Corporation, using 2021 as a base. (If amount and percentage are a decrease show the numbers as negative, e.g. -55,000, -20% or (55,000), (20%). Round percentages to 1 decimal place, e.g. 12.1%.)
Answer:
Explanation:
Horizontal analysis of financial statements is a system of comparing each item of financial statement in a previous year to the current year with each line item analysis expressed in a horizontal pattern for clear comparison.
The change in growth is calculated by deducting the previous year's value of an item of the financial statement from the current year while the percentage growth is calculated by calculating the growth value as a percentage of the previous year value
2022 2021 Change % Change
Net sales 639,400 578,200 61,200 10.6%
Cost of goods 464,800 433400 31,400 7.3%
Gross profit 174,600 144,800 29,800 20.6%
Operating exp. 70,500 43,000 27,500 70%
Net Income 104,100 101,800 2,300 2.26%
On September 1, Jenkins Company purchased $2,520 of supplies on account. By the end of the calendar year, $2,000 of supplies remains. Required: 1. How much has been expensed by the end of the year? 2. How much will be in the Supplies account at the end of the year, after the adjusting entries have been prepared and posted?
Answer:
The amount expensed by the end of the year is $520.The balance in the supplies account at the end of the year, after the adjusting entries have been prepared and posted is $2,000.Explanation:
To calculate the amount of supplies that was expensed, we simply deduct the closing balance of $2,000 from the opening balance of $2,520, as follows: $2,520 - $2,000 = $520. So, the amount of $520 was expensed during the year and the appropriate entries recorded will be:
Debit Supplies expense $520
Credit Supplies $520
(To record the amount of supplies expensed)
You want to invest in a project in LaLaLand. The project has an initial cost of LLL 757,000 and is expected to produce cash inflows of LLL 396,000 a year for 3 years. The project will be worthless after that. The expected inflation rate in LaLaLand is 4% while it is only 3% in the U.S. The applicable interest rate for a project like this in LaLaLand is 12%. The current spot exchange rate is LLL1 = $2.3456.
What is the Net Present Value of this project in Lalaland's currency.(i.e., in "LLL")?
Answer:
194,112.8
Explanation:
The computation of Net Present Value is shown below:-
Net Present Value = Present value of cash inflows - Present value of Cash outflows
= -757,000 + 396,000 × PVAF (12%, 3 years)
= -757,000 + 396,000 × 2.4018
= -757,000 + 951,112.8
= LLC 194,112.8
= 194,112.8
Therefore for computing the net present value we simply applied the above formula.
Which of the following is false? Economists who advocate discretionary monetary policy argue that it is more likely to achieve the desired economic results because the monetary authority has the flexibility to shape the best monetary policy to the existing circumstances. Here is an example of zero crowding out: The government spends $100 more and the private sector doesn’t spend any less. Here is an example of complete crowding out: The government spends $100 more and the private sector spends $100 less. Not all economists believe that rule-based monetary policy is preferable to discretionary monetary policy. none of the above
Answer: None of the above
Explanation:
All of the above are correct.
For option A, Economists who advocate discretionary monetary policy do indeed believe that the monetary authority using this policy is more flexible to shape the best monetary policy to the existing circumstances.
Option B is also correct because Crowding out occurs when the government increases investment by borrowing which leaves less money for the private sector to borrow so they spend less. The government spent money here yet the private sector did not spend less so it is Zero Crowing out.
Option C by option B's explanation holds true because the entire amount the Government increased by was denied the private sector.
Option D is also true as not all Economists prefer rule-based monetary policy to discretionary monetary policy.
They are all true.
At December 31, 2020, Wildhorse Company has outstanding three long-term debt issues. The first is a $1,810,000 note payable which matures June 30, 2023. The second is a $4,830,000 bond issue which matures September 30, 2024. The third is a $13,760,000 sinking fund debenture with annual sinking fund payments of $2,752,000 in each of the years 2022 through 2026. Prepare the required note disclosure for the long-term debt at December 31, 2020.
Answer and Explanation:
The Preparation of note disclosure for the long-term debt is shown below:-
Note disclosure for the long-term debt
At the year end 31, December 2020
Year Amount Working note
2021 0
2022 $2,752,000 From annual sinking fund payment
2023 $4,562,000 ($1,810,000 annual sinking fund payment + $2,752,000 note payable maturity)
2024 $7,582,000 ($4,830,000 annual sinking fund payment + $2,752,000 bond maturity)
2025 $2,752,000 From annual sinking fund payment
A pension plan is obligated to make disbursements of $1 million, $2 million, and $1 million at the end of each of the next three years, respectively. The annual interest rate is 10%. If the plan wants to fully fund and immunize its position, how much of its portfolio should it allocate to one-year zero-coupon bonds and perpetuities, respectively, if these are the only two assets funding the plan?
Answer:
Investment in Zero coupon bond=90.48%
Investment in perpetuity=9.52%
Explanation:
Check attachment
The area manager of the Red, White, and Brew Restaurants is considering two possible expansion alternatives. The required investments, expected controllable margins, and the ROIs of each are as follows:
Project Investment Controllable Margin ROI
Phoenix $120,000 $30,000 25%
Chicago $540,000 $50,000 9.25%
The Red, White, and Brew segment has currently $2,000,000 in invested capital and a controllable margin of $250,000.
1. Which one of following projects will increase the Red, White, and Brew division’s ROI?
O Both the Phoenix and Chicago optionsO Only the Phoenix optionO Only the Chicago optionO Neither the Phoenix nor the Chicago options
Answer:
Only the Phoenix
Explanation:
According to the scenario, computation of the given data are as follow:-
ROI of Red, White And Brew Segment = Controllable Margin ÷ Total Investment × 100
$250,000 ÷ $2,000,000 × 100 = 12.5%
ROI of Phoenix = 25%
ROI of Chicago = 9.25%
So only phoenix will increase the red, white and brew division’s ROI, Because Chicago ROI is less than ROI of Red, White and Brew Segment.
Debtors are interested in the times interest earned ratio because they want to a.know the tax effect of lending to a corporation b.be sure their debt is backed by collateral c.know what rate of interest the corporation is paying d.have adequate protection against a potential drop in earnings jeopardizing their interest payments
Answer: d.have adequate protection against a potential drop in earnings jeopardizing their interest payments
Explanation:
The Times Interest Earned Ratio is a measure that allows for the analysis of if a company can keep up it's debt payments.
It is calculated by dividing the Earnings before Interest and Tax by the Interest Expense of the debt.
The higher the number, the better because it means that they can keep up debt payments several times over.
As Debtors therefore, this figure is important because missing a debt payment is very bad for credit ratings and this matrix helps them realise if they can keep paying for debt even if their Earnings drop.
Galla Inc. needs to determine a price for a new product. Galla desires a 25% markup on the total cost of the product. Galla expects to sell 6420 units. Additional information is as follows: Variable product cost per unit $ 23 Variable administrative cost per unit 25 Total fixed overhead 46,500 Total fixed administrative 30,540 Using the total cost method what price should Galla charge?
Answer:
The price Galla should charge is $75
Explanation:
Solution
Now
The total cost = variable product cost + variable administrative cost + fixed overhead + fixed administrative
= ($23 * 6,420) + ($25 * 6,420) + $46,500 + $30,540
= $147,660 + $160,500 + $46,500 + $30,540
= $385,200
Thus,
The total cost per unit = Total cost / units
= $385,200 / 6,420 units
= $60
Hence
The selling price should charge = Cost per unit * 1.25
= $60 * 1.25
= $75
Which of the following situations leads to an unplanned increase in inventories of $2.0 trillion? A. real GDP = $5.0 trillion and aggregate planned expenditures = $7.0 trillion B. real GDP = $5.0 trillion and aggregate planned expenditures = $5.0 trillion C. real GDP = $6.0 trillion and aggregate planned expenditures = $4.0 trillion D. real GDP = $8.0 trillion and aggregate planned expenditures = $5.0 trillion E. More information is needed about planned investment and actual investment.
Answer: C. real GDP = $6.0 trillion and aggregate planned expenditures = $4.0 trillion
Explanation:
Unplanned Inventory arises when Real GDP is larger than Planned Expenditure because it must satisfy the below formula,
Real GDP = Planned + Unplanned expenditure
For Option C,
Real GDP = 6.0 trillion,
Planned expenditure = 4.0 trillion
Unplanned Expenditure = Real GDP - Planned Expenditure
= $6.0 trillion - $4.0 trillion
= $2.0 trillion
Therefore Option C is correct as it led to a $2.0 trillion increase in Expenditure which translates to inventory.
On January 1, 2020, the Concord Company ledger shows Equipment $36,000 and Accumulated Depreciation―Equipment $10,100. The depreciation resulted from using the straight-line method with a useful life of 7 years and salvage value of $5,000. On this date, the company concludes that the equipment has a remaining useful life of only 4 years with the same salvage value. Compute the revised annual depreciation.
Answer:
$5150
Explanation:
Revised Book value =$36000-$10400
=$25600
Salvage value= $5000
Years=4
Annual Depreciation = (Book value - Dep) / Time
=($25600-$5000) / 4
=$20600 / 4
=$5150
The annual depreciation for another 4 years is = $5150
Scenario 28-1 Suppose that the Bureau of Labor Statistics reports that the entire adult population of Mankiwland can be categorized as follows: 25 million people employed, 3 million people unemployed, 1 million discouraged workers, and 1 million people who are either students, homemakers, retirees, or other people not seeking employment. Refer to Scenario 28-1. What is the unemployment rate?
Answer:
10.7%
Explanation:
Solution:
Recall that:
The Reports from Bureau of labor statistics is shown as follows:
Employed people = 25 million
Unemployed people = 3 million
Discouraged workers = 1 million
Workers or Homemakers or retirees, or students = 1 million
The next step from this scenario is to find out the unemployment rate
Now,
The rate of unemployed = (unemployed x 100 ) / labor force
= 300/28
=10.7%
Zanny Moldings has the following estimated costs for the upcoming year:
Direct materials used $25,800
Direct labor costs $62,600
Salary of factory supervisor $37,600
Advertising expense $33,800
Heating and lighting costs for factory $22,000
Depreciation on factory equipment $5600
Sales commissions $8100
The company estimates that 2100 direct labor hours will be worked in the upcoming year, while 2700 machine hours will be used during the year. The predetermined manufacturing overhead rate per direct labor hour is closest to:____________
A) $72.
B) $51.
C) $29.
D) $31.
Answer:
D) $31.
Explanation:
The computation of the predetermined overhead rate is shown below:
Predetermined overhead rate = Estimated manufacturing overhead ÷ estimated direct labor hours
where,
Estimated manufacturing overhead is
= Salary of factory supervisor + Heating and lighting costs for factory + Depreciation on factory equipment
= $37,600 + $22,000 + $5,600
= $65,200
And, the direct labor hours is 2,100
So, the predetermined overhead rate is
= $65,200 ÷ 2,100
= $31
Absorption and variable costing. (CMA) Miami, Inc., planned and actually manufactured 250,000 units of its single product in 2017, its first year of operation. Variable manufacturing cost was $19 per unit produced. Variable operating (nonmanufacturing) cost was $13 per unit sold. Planned and actual fixed manufacturing costs were $750,000. Planned and actual fixed operating (nonmanufacturing) costs totaled $420,000. Miami sold 170,000 units of product at $41 per unit.
Required:
1. Miami's 2017 operating income using absorption costing is:
(a) $ 600,000
(b) $ 360,000
(c) $ 780,000
(d) $ 1,020,000
(e) None of above
2. Miami's 2017 operating income using variable costing is:(a) $ 1,100,000(b) $ 600,000(c) $ 360,000(d) $ 780,000(e) None of above
Answer:
1.(b) $ 360,000
2. (c) $ 360,000
Explanation:
Miami, Inc.
Absorption Costing
Income Statement
Sales 170,000 units * $41 $ 6970,000
Variable manufacturing cost $19 *170,000 units = 3230,000
Actual fixed manufacturing costs $750,000
Contribution Margin $ 2990,000
Variable operating (non manufacturing) cost $13 *170,000 units =2210,000
Actual fixed operating (non manufacturing) costs $420,000
Operating Income $ 360,000
The difference b/w variable and absorption costing is that in variable costing the variable expenses are treated as product costs and fixed expenses as period costs. But in absorption costing the manufacturing expenses variable and fixed are treated as product costs and selling and administrative expenses both fixed and variable are treated as period costs.
Miami, Inc.
Variable Costing
Income Statement
Sales 170,000 units * $41 $ 6970,000
Variable manufacturing cost $19 *170,000 units = 3230,000
Variable operating (non manufacturing) cost $13 *170,000 units =2210,000
Contribution Margin $1530,000
Actual fixed manufacturing costs $750,000
Actual fixed operating (non manufacturing) costs $420,000
Operating Income $ 360,000
Analysis reveals that a company had a net increase in cash of $22,750 for the current year. Net cash provided by operating activities was $20,500; net cash used in investing activities was $11,250 and net cash provided by financing activities was $13,500. If the year-end cash balance is $27,750, the beginning cash balance was: Multiple Choice $5,000. $17,750. $50,500. $45,500. $44,500.
Answer:
The correct answer = $5,000
Explanation:
First of all, let us find the difference between the total cash provided and the total cash used up within the period:
Total cash provided = operating activities + financing activities
Total cash provided = 20,500 + 13,500 = $34,000
Total cash used up = investing activities = $11,250
Retained balance from the activities of the period = Total cash provided - Total cash used up
= 34,000 - 11,250 = $22,750
Retained balance from the activities of the period = $22,750
However, we are told that the year-end cash balance = $27,750. This means that the excess cash on the retained balance from operating activities within the period is from the beginning cash balance, and this is calculated as follows:
year-end cash balance = Retained balance from the activities + beginning cash balance
27,750 = 22,750 + beginning cash balance
∴ beginning cash balance = 27,750 - 22,750 = $5,000
∴ beginning cash balance = $5,000
Managers must chart a company's strategic course by Multiple Choice ensuring excess production capacity and/or inventory. building a bigger dealer network. ensuring that marketing and promotion programs are state-of-the-art. developing a thorough understanding of the company's external and internal environments. competing fiercely for a share in the market.
Answer:
The correct answer is the fourth option: developing a thorough understanding of the company's external and internal environments.
Explanation:
To begin with, in order to understand that a company's strategy must be guided by thorough understanding of its external and internal environments it is necessary to understand that the system proposed is formed by several factors that influence it and therefore that a manager must study carefully those factors and that system in order to guide the company to a successful work and accomplish the goals by using a strategy that compresses all the information about those factors.
Great Adventures Problem
[The following information applies to the questions displayed below.]
Tony and Suzie see the need for a rugged all-terrain vehicle to transport participants and supplies. They decide to purchase a used Suburban on July 1, 2022, for $15,600. They expect to use the Suburban for five years and then sell the vehicle for $6,300. The following expenditures related to the vehicle were also made on July 1, 2022:_________.
1. The company pays $2,700 to GEICO for a one-year insurance policy.
2. The company spends an extra $6,600 to repaint the vehicle, placing the Great Adventures logo on the front hood, back, and both sides. An additional $2,900 is spent on a deluxe roof rack and a trailer hitch.
3. The painting, roof rack, and hitch are all expected to increase the future benefits of the vehicle for Great Adventures. In addition, on October 22, 2022, the company pays $2,200 for basic vehicle maintenance related to changing the oil, replacing the windshield wipers, rotating the tires, and inserting a new air filter.
Great Adventures
4. Record the depreciation expense and any other adjustments related to the vehicle on December 31, 2022. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
Answer and Explanation:
The Journal entry is shown below:-
Amount should be capitalized for new vehicle = Cost + Painting and new logo cost + Deluxe Roof rack and trailer hitch
= $15,600 + $6,600 + $2,900
= $25,100
We took the cost of painting and deluxe roof and trailer hitch costs into account as they are supposed to increase the vehicle's future benefits.
Depreciation = (Cost - Salvage Value) ÷ Number of Years
= ($25,100 - $6,300) ÷ 5
= $3,760 per year
In the year 2022 vehicle is used only for 6 months (July to Dec), depreciation expense for the year ended December 31, 2022 is
= $3,760 × 6 ÷ 12
= $1,880
So, the Journal entry is
Depreciation expense Dr, $1,880
To Accumulated Depreciation $1,880
(Being depreciation provided for the year 2022 is recorded)
Therefore for recording the depreciation provided for the year 2022 we simply debited the depreciation expenses while we credited the accumulated depreciation.
The journal entry will include a depreciation account as well as accumulated depreciation.
What is depreciation?Depreciation can be defined as the amount deducted from the asset because of the wear and tear of the asset after its use Which will reduce the price of the asset.
Capitalization for a new car should be calculated as follows: Cost + Painting and Logo Cost + Deluxe Roof Rack and Trailer Hitch
= $15,600 + $6,600 + $2,900
= $25,100
We factored in the price of the painting, a luxurious roof, and a trailer hitch because such expenses should raise the car's potential future value.
Depreciation is calculated as (Cost - Salvage Value) x Years.
= ($25,100 - $6,300) ÷ 5
= $3,760 annually
For the year ending December 31, 2022, the depreciation expense for the automobile operated for only 6 months (July to December) is
= $3,760 × 6 ÷ 12
= $1,880
The journal entry is therefore
depreciation costs (dr.) $1,880
accumulated depreciation $1,880
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I WILL MARK BRAINLIEST! 30 POINTS!
Ideas on products or services that are NOT yet in the market.
Please put more than one!
Shapewear.
Travel accessories.
Healthy and beauty products.
Smart watches.
Health Care.
Skin Care.
Hobbies and Craft.
Lamps and Shades.
Planners.
Facial products.
Smartphone accessories.
Subscription boxes.
Handcrafted wood products.
Eco-friendly feminine products.
Speciality hair products.
International tea and coffee products.
these are things that might go out this year but there not in stores yet
Cawley Company makes three models of tasers. Information on the three products is given below.Tingler Shocker Stunner Sales $296,000 $504,000 $200,000 Variable expenses 145,000 190,000 135,000 Contribution margin 151,000 314,000 65,000 Fixed expenses 114,840 225,160 92,000 Net income $36,160 $88,840 $(27,000) Fixed expenses consist of $290,000 of common costs allocated to the three products based on relative sales, as well as direct fixed expenses unique to each model of $29,000 (Tingler), $79,000 (Shocker), and $34,000 (Stunner). The common costs will be incurred regardless of how many models are produced. The direct fixed expenses would be eliminated if that model is phased out.James Watt, an executive with the company, feels the Stunner line should be discontinued to increase the company’s net income.
(a) Compute current net income for Cawley Company. Net income $ ______
(b) Compute net income by product line and in total for Cawley Company if the company discontinues the Stunner product line. (Hint: Allocate the $290,000 common costs to the two remaining product lines based on their relative sales.)
Tingler Net Income $ _______
Shocker Net Income $ _______
Total Net Income $ _______
(c) Should Cawley eliminate the Stunner product line?
Why or why not?
Net income would _____ from $ ______to $ ________.
Answer:
Cawley Company
a) Current Net Income
Tingler Shocker Stunner Total
Sales $296,000 $504,000 $200,000 $1,000,000
Variable Costs 145,000 190,000 135,000 470,000
Contribution 151,000 314,000 65,000 530,000
Fixed Expenses 114,840 225,160 92,000 432,000
Net Income 36,160 88,840 (27,000) 98,000
b) Net Income by product line with Stunner discontinued:
Tingler Shocker Total
Sales $296,000 $504,000 $800,000
Variable Costs 145,000 190,000 335,000
Contribution 151,000 314,000 465,000
Fixed Expenses 136,300 261,700 398,000
Net Income 14,700 52,300 67,000
c1) Cawley should not eliminate the Stunner product line.
c2) Net income would decrease from $98,000 to $67,000 if the Stunner product line is eliminated.
Explanation:
a) The decision to be made is whether to eliminate a product line or not. In making such decisions, the relevant costs to be considered are avoidable costs. Allocated fixed costs are unavoidable and should not be taken into account.
b) Stunner makes a Net Income of $31,000 without the allocated common fixed expenses. This shows that the allocated common fixed expenses is actually causing Stunner to record Net Loss. And when Stunner is eliminated the company is not better off.
c) Allocation of Fixed Expenses based on Sales:
Tingler = 296/800 * $290,000 = $107,300 Plus direct cost of $29,000 = $136,300
Shocker = 504/800 * $290,000 = $182,700 Plus direct of of $79,000 = $261,700
Rebel Sound Inc. produced 30,000 audio devices last month. Rebel started the month with $10,000 worth of inventory in Finished Goods. The company incurred $15,000 of various utility and rent charges on their factory, paid $50,000 for raw materials to use in production, and paid employees $60,000 in wages.
During the month, inventory costing $120,000 was completed and transferred to the Finished Goods Inventory. At the end of the month, Rebel had $5,000 of Inventory in Finished Goods, $6,000 in Materials Inventory, and $24,000 still in Work in Process.
Required:
1. What was Rebel Sound Inc Cost of Goods Manufactured for the month?
Answer:
Cost of goods manufactured is $ 101,000 for the month
Explanation:
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Cost of Goods Manufactured:
$
Work in process inventory, beginning $ -
Direct materials:
Direct Material Used $ 60,000
Direct labor $ 15,000
Factory overhead Applied $ 50,000
Total manufacturing costs $125,000
Total work in process during period $125,000
Work in process inventory, ending $ -24,000
Cost of goods manufactured $ 101,000
Assume the following: WIP, beginning 2 comma 500 units (100% complete as to direct materials, 50% complete as to conversion costs) Started 10 comma 500 units during the period Total spoilage is 700 with normal spoilage is calculated to be 550 units Completed and transferred out during the period 6 comma 000 units WIP, ending 6 comma 300 units (100% complete as to direct materials, 60% complete as to conversion costs) Spoiled units 700 and inspection happens when the process is 20% complete All materials are added at the start of the process Under the weighted average method, would would be the equivalent units of work done for the period? A. 9 comma 920 B. 10 comma 190 C. 6 comma 000 D. 6 comma 300
Answer:
B. 10 comma 190
Or none of the given
Explanation:
Particulars Units % of Completion Equivalent Units
Materials Conversion Materials Conversion
Transferred 6000 100 100 6000 6000
+Ending WIP 6300 100 60 6300 3780
+Normal Spoilage 550 100 60 550 330
+Abnormal
Spoilage 150 100 60 150 90
Total 13000 10200
As we see the total weighted Equivalent units for materials are 13000
and for conversion are 10200 . So the correct choice would be 10190 that is choice B which the nearest answer of the choices given to the answer calculated .
Under weighted method the Transferred out units are added to the ending work in process and the normal and abnormal spoilage is also added to find the equivalent units of production.
The other answer would be none of the given choices if exact figures are to be matched.
Bakers' Town Bread is selling 1,500 shares of stock through a Dutch auction. The bids received are as follows: 200 shares at $17 a share, 400 shares at $15, 700 shares at $14, 400 shares at $13, and 200 shares at $11 a share. How much cash will the company receive from selling these shares of stock?
Answer:
$19,500
Explanation:
A Dutch auction is one of many common Auction types to buy or sell goods. Most generally, it means an auction where the auctioneer starts with a high selling price and decreases it until some buyer accepts the offer or arrives at a fixed reserve price.
Therefore in the given case, the cash received by the company from selling the shares of stock is
= 1,500 shares × $13
= $19,500
The $13 represent the highest bid price
