Tyrell Co. entered into the following transactions involving short-term liabilities in 2012 and 2013:
2012
Apr. 20 Purchased $38,000 of merchandise on credit from Locust, terms are 1/10, n/30. Tyrell uses the perpetual inventory system.
May 19 Replaced the April 20 account payable to Locust with a 90-day, $35,000 note bearing 9% annual interest along with paying $3,000 in cash.
July 8 Borrowed $63,000 cash from National Bank by signing a 120-day, 10% interest-bearing note with a face value of $63,000.
? Paid the amount due on the note to Locust at the maturity date.
? Paid the amount due on the note to National Bank at the maturity date.
Nov. 28 Borrowed $27,000 cash from Fargo Bank by signing a 60-day, 6% interest-bearing note with a face value of $27,000.
Dec. 31 Recorded an adjusting entry for accrued interest on the note to Fargo Bank.
2013
? Paid the amount due on the note to Fargo Bank at the maturity date
Required:
Prepare the journal entries for these transactions.
ank by signing a 60-day, 6% interest-bearing note with a face value of $27,000.
Dec. 31 Recorded an adjuO
(Ignore income taxes in this problem.) Assume you can invest money at a 14 percent rate of return. How much money must be invested now to be able to withdraw $5,000 from this investment at the end of each year for eight years, the first withdrawal occurring one year from now
Answer:
the original amount invested = $285,714.29
Explanation:
Let original amount invested be x
Amount to be withdrawn per year = $5,000
Total number of years = 8
Total amount to be withdrawn = 5,000 × 8 = $40,000
Next, we are told that 14% return on x is realized,
∴ 14% return on x = $40,000
0.14 × x = 40,000
x = 40,000 ÷ 0.14 = $285,714.29
Therefore, the original amount invested = $285,714.29
Irving Corporation makes a product with the following standards for direct labor and variable overhead: Standard Quantity or Hours Standard Price or Rate Standard Cost Per Unit Direct labor 0.20 hours $ 29.00 per hour $ 5.80 Variable overhead 0.20 hours $ 6.50 per hour $ 1.30 In November the company's budgeted production was 6,800 units, but the actual production was 6,600 units. The company used 1,510 direct labor-hours to produce this output. The actual variable overhead cost was $9,211. The company applies variable overhead on the basis of direct labor-hours. The variable overhead rate variance for November is:
Answer:
Manufacturing overhead rate variance= $604 favorable
Explanation:
Giving the following information:
Variable overhead 0.20 hours $ 6.50 per hour
The company used 1,510 direct labor-hours to produce this output. The actual variable overhead cost was $9,211.
To calculate the variable overhead rate variance, we need to use the following formula:
Manufacturing overhead rate variance= (standard rate - actual rate)* actual quantity
Actual rate= 9,211/1,510= $6.1
Manufacturing overhead rate variance= (6.5 - 6.1)*1,510
Manufacturing overhead rate variance= $604 favorable
Now suppose country A imposes a tax on A's production of to curb emissions. Country B, however, is not taxed. A's cost function is now , while B's cost function is . World demand is . The amount of greenhouse gas emissions per unit is still , such that total world emissions are given by . What are total world emissions after country A enacts a carbon tax?
Answer:
286.5
Explanation:
P=99-qa-qb
MRa=99-2qb-qb
MCa=48
99-2qa-qb=48
Qa=25.5-0.5qb{ best response function of firm A)
MRb=99-qa-2qb
MCb=4
99-qa-2qb=4
Qb=47.5-0.5qa{ best response function of form b}
Qb=47.5-0.5(25.5-0.5qb)
Qb=34.75/0.75=46.33
Qa=25.5-0.5*46.33=2.33
Total world output=46.33+2.33=48.66
Total world emission=0.5*48.66=24.33
p=1146-qa-qb-qc
MRa=1146-2qa-qb-qc
MCa=0
1146-2qa-qb-qc=0
Qa=573-0.5(qb+qc) best response function of firm a)
By symmetry,
Qb=573-0.5(qa+qc)
Qc=573-0.5(qa+qb)
Qb+qc=1146-qa-0.5(qb+qc)
Qb+qc=764-qa/1.5
Qa=573-0.5(764-qa/1.5)=191+qa/3
Qa=191*3/2=286.5
Qa=Qb=Qc=286.5
Total output=3*286.5=859.5( cournot equilibrium market output)
Cartel output=573
Lower QUANTITY in cartel equilibrium compare to cournot equilibrium
=859.5-573
=286.5
Arlington Clothing, Inc., shows the following information for its two divisions for year 1: Lake Region Coastal Region Sales revenue $ 4,200,000 $ 13,110,000 Cost of sales 2,711,300 6,555,000 Allocated corporate overhead 252,000 786,600 Other general and administration 557,900 3,759,000 Required: a. Compute divisional operating income for the two divisions. Ignore taxes.
Answer:
Lake Region Coastal region
Operating income ($) 678,800. 2,009,400.
Explanation:
Lake Region Coastal region
$'000 $'000
Sales revenue 4,200 13,110
Cost of sales (2,711) (6.555)
Gross profit 1,488.7 6,555
Allocated overhead (252) (786.6)
Other general overhead (557.9) ( 3,759)
Operating income 678.8 2,009.4
Lake Region Coastal region
Operating income 678,800. 2,009,400.
Built-Tight is preparing its master budget for the quarter ended September 30. Budgeted sales and cash payments for product costs for the quarter follow: JulyAugustSeptemberBudgeted sales$64,000 $80,000 $48,000 Budgeted cash payments for Direct materials 16,160 13,440 13,760 Direct labor 4,040 3,360 3,440 Factory overhead 20,200 16,800 17,200 Sales are 20% cash and 80% on credit. All credit sales are collected in the month following the sale. The June 30 balance sheet includes balances of $15,000 in cash; $45,000 in accounts receivable; and a $5,000 balance in loans payable. A minimum cash balance of $15,000 is required. Loans are obtained at the end of any month when a cash shortage occurs. Interest is 1% per month based on the beginning-of-the-month loan balance and is paid at each month-end. If an excess balance of cash exists, loans are repaid at the end of the month. Operating expenses are paid in the month incurred and consist of sales commissions (10% of sales), office salaries ($4,000 per month), and rent ($6,500 per month).rev: 03_17_2020_QC_CS-2046792. Prepare a cash budget for each of the months of July, August, and September.
The Preparation of cash budget for each of the months of July, August, and September is shown below:
Preparation of the cash budget:Cash budget
For the month of July, August and September
July August September
Beginning cash balance $15,000 $15,000 $25,505
Cash receipts from
customer (Working note) $57,800 $67,200 $73,600
Total cash available $72,800 $82,200 $99,105
Less:
Cash disbursements
Direct Materials $16,160 $13,440 $13,760
Sales commission $6,400 $8,000 $4,800
(10% of sales)
Office salaries $4,000 $4,000 $4,000
Rent $6,500 $6,500 $6,500
Direct Labor $4,040 $3,360 $3,440
Overhead Cost $20,200 $16,800 $17,200
Interest on bank loan
For July (5,000 × 1%) $50
For August $46
($5,000 - $4,550) × 1%))
For September $0
Preliminary Cash
balance $15,450 $30,055 $49,405
Repayment of loan to
Bank $450 $4,550
($5,000 - $450)
Ending cash balance $15,000 $25,505 $49,405
Working Note
The ending balance of the particular month should be treated as a opening balance of next month
August ending balance will be forwarded in Sept as a opening balance.
Working Note
July August September
Sales $64,000 $80,000 $48,000
Less:
Ending accounts
receivable
(80% of sales) $51,200 $64,000 $38,400
Cash sales $12,800 $16,000 $9,600
Last month cash
collection $45,000 $51,200 $64,000
Cash receipts from
customer $57,800 $67,200 $73,600
Therefore we added the cash receipts as it increase the cash balance and deduct all cash payment as it decrease the cash balance
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i. Lawyers are changing their pay structures. It used to be that they would bill hourly (top dollar for top lawyers, less experienced helpers had cheaper rates). Now they’re beginning to price like consultants—per project. Thus they must begin assessing the value-added to the client firm of the legal expertise and assistance. What advice would you give a law firm to proceed fairly and profitably?
Answer:
Prominent conjoint analysis is said to be the only thing that I would recommend to the law firming order in order to ensure that the order has proceed fairly and as well as profitably .
Due to the fact that this method of payment is said to offers different prices for different projects to both the top lawyers and the less experienced help.
Explanation:
The mode of payment that lawyers have made had turned to be the best and most interesting mode of payment structures, because before reading the above article I was not actually aware of the payment strategy to be in paying most individuals due to the fact that the most prominent conjoint analysis is said to be the only thing that I would recommend to the law firming order in order to ensure that the order has proceed fairly and as well as profitably .
Due to the fact that this method of payment is said to offers different prices for different projects to both the top lawyers and the less experienced help.
What is the effect of just-in-time inventory strategies? A. They increase business efficiency by reducing inventory costs. B. They outsource manufacturing jobs to underdeveloped nations. C. They eliminate the need for tasks such as welding and assembling. D. They expand businesses with the use of worldwide telecommunication.
The answer is A
Explanation:
The I-75 Carpet Discount Store has an annual demand of 10,000 yards of super shag carpet. The annual carrying cost for a yard of carpet is $0.75 and the ordering cost is $150. The carpet manufacturer normally charges the store $8 per yard for the carpet.; however, the manufacturer has offered a discount price of $6.50 per yard if the store will order 5,000 yards. How much should the store order, and what will be the total inventory cost for that order quantity?
Answer:
5 units and $2,175
Explanation:
a. The computation of the economic order quantity is shown below:
= [tex]\sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}[/tex]
=[tex]\sqrt{\frac{2\times \text{10,000}\times \text{\$150}}{\text{\$0.75}}[/tex]
= 2,000 units
The total cost of ordering cost and carrying cost equals to
= Annual ordering cost + Annual carrying cost
= Purchase cost + Annual demand ÷ Economic order quantity × ordering cost per order + Economic order quantity ÷ 2 × carrying cost per unit
= 10,000 × $8 + 10,000 ÷ 2,000 × $150 + 2,000 ÷ 2 × $0.75
= 80,000 + $750 + $750
= $81,500
Now in case of ordering 5,000 yields at discount price of $6.50 the total cost is
= Purchase cost + Annual demand ÷ Economic order quantity × ordering cost per order + Economic order quantity ÷ 2 × carrying cost per unit
= 10,000 × $6.50 + 10,000 ÷ 5,000 × $150 + 5,000 ÷ 2 × $0.75
= $65,000 + 300 + $1,875
= $67,175
Therefore there will be 5 units should store at a time and cost of inventory is 300 + $1,875 = $2,175
Suppose that you are the international treasurer of Apple with an extra U.S. $10 million to invest for 9 months. You are considering the purchase of U.S. T-bills that yield 1.50% annual rate. The spot exchange rate is $1.00 = ¥100, and the 9 month forward rate is $1.00 = ¥110. What must the interest rate in Japan be before you are willing to consider investing there for 9 months? A. 14.5515 B. <8.8975 C. >13.4983 D. 12.5050
Answer:
Japan Interest Rate = 0.15%
Explanation:
As per Interest Rate Parity Theory
Spot Rate : 1$ = 100
Forward Rate : 1 $ = 110
r = 9/12
As per interest rate parity, forward rate = Spot rate(1+Interest rate Japan)/(1+Interest rate US)
Forward rate = Spot rate *(1+ iD)/(1+iF)
110 / 100 = (1 + Japan Interest Rate * 9 /12) / 1.01125
1.1 * 1.01125 = 1 + Japan Interest Rate * 0.75
1.112375 = 1 + Japan Interest Rate * 0.75
Japan Interest Rate * 0.75 = 1.112375 - 1
Japan Interest Rate * 0.75 = 0.112375
Japan Interest Rate = 0.112375 / 0.75
Japan Interest Rate = 0.15%
Granite State Airlines serves the route between New York and Portsmouth, NH, with a single-flight-daily 100-seat aircraft. The one-way fare for discount tickets is $100, and the one-way fare for full-fare tickets is $150. Discount tickets can be booked up until one week in advance, and all discount passengers book before all full-fare passengers. Over a long history of observation, the airline estimates that full-fare demand is normally distributed, with a mean of 56 passengers and a standard deviation of 23, while discount-fare demand is normally distributed, with a mean of 88 passengers and a standard deviation of 44.
a) A consultant tells the airline they can maximize expected revenue by optimizing the booking limit. What is the optimal booking limit? (Hint: Use the standard normal cumulative distribution table)
b) The airline has been setting a booking limit of 44 on discount demand, to preserve 56 seats for full-fare demand. What is their expected revenue per flight under this policy? (Hint: First find the expected revenue when b= 0. Here you can assume Probability{df = k} = Ff(k+0.5) – Ff(k-0.5) and use a spreadsheet. Then using the recursive formula, find the expected revenue if b is increased by 1 until it reaches b=44 using a spreadsheet)
c) What is the expected gain from the optimal booking limit over the original booking limit?
d) A low-fare competitor enters the market and Granite State Airlines sees its discount demand drop to 44 passengers per flight, with a standard-deviation of 30. Full-fare demand is unchanged. What is the new optimal booking limit?
Answer:
Given data: One flight with total seats = 100
Full fare passengers, cost per ticket=$150, mean=56 passengers, SD=23
Discount fare passengers, cost per ticket=$100, mean=88 passengers, SD=44
(a) Here, though there is a hint to use the CDF, since the confidence interval is not given we will make some simplying assumptions that will reduce the complexity of the question, of course keeping the question statistically correct.
this question wants us to maximize total revenue per flight (one way), we can do that by taking only full fare passengers or total revenue will be 150*100=$15,000, but since historical probability shows a mean of 56 with a standard deviation of 23, we can assume in best case scenario total full fare ticket passengers will be 56+23=79, leaving 21 tickets for discount passenger, in this case the total revenues will be 79*150+21*100=$13,950
(b) Now, the new constrained policy is giving a clear cut number of seats to each category of pasengers, 44 for discount (total revenues 44*100) and 56 for full fare (total revenues 56*150) both of which are within the probabilities given earlier (full fare mean=56, discount mean=88). Total revenues in case will be 44*100+56*150=$12,800.
(c) Gain is the difference of the excess revenues in both cases of optimal total revenues and limited seats policy or answer (a) - answer (b) = $13,950- $12,800=$1,150
(d) Realistically speaking, there is no answer for this question without a clear cut confidence interval. Another simplifying assumption we can make here is taking the mean passengers as expected bookings (can be tweaked once confidence interval or degree of significance is given). so total revenues in this case will be 44*100 from discount and 56*150 from full fare passengers. That is still similar to answer (c) due to our assumption/lack of constraints, so our optimal booking will be 54 full fare tickets and 44 discount passenger tickets. You can also take worst case scenario by subtracting SD of each passenger type from the mean or go the best case scenario in which SD of full fare will be added to the mean while the pending seats (left over from 100) will be the total to discount fare for optimal revenue collection.
Given knowledge: One flight with a total capacity of 100 passengers.
Passengers paying full fare, the average ticket price of $150, mean of 56 passengers, SD of 23
Participants on a discount price, with a ticket cost of $100, a mean of 88 passengers, and a standard deviation of 44.
(a) Spite of the fact there is a hint to utilize the CDF because statistical power is not supplied, we will make some presumptions to minimize the complexity of the question whilst retaining statistical accuracy.
We can do so by hardly taking full-fare passengers, in which particular instance total revenue will be 150*100=$15,000, but since historical probability shows a mean of 56 with a standard deviation of 23.
we can assume that total full fare ticket passengers will be 56+23=79, leaving 21 tickets for discount passengers, in which case total revenues will be[tex]79\times150+21\times100=\$13,950.[/tex]
(b) This new limited program now assigns a specific number of seats to each passenger category: 44 for discount (total revenues [tex]44\times100[/tex]) and 56 for full-fare (total revenues [tex]56\times150[/tex]), both of which are within the probability (full fare mean=56, discount mean=88).
In this instance, total revenues will be [tex]44\times100+56\times150=\$12,800.[/tex]
(c) Gain is the differential between the excess earnings in both the ideal overall revenue and restricted seat policies or $13,950- $12,800=$1,150.
(d) Without a well-defined standard error, there is no real answer to this question. Another assumption we might make to make things easier is to treat the average passengers as projected bookings. In this instance, total revenues will be 44*100 from discount passengers and 56*150 from full rate passengers.
Due to our assumption/lack of limitations, our ideal booking will be 54 full-price tickets and 44 discount passenger tickets, which is comparable to the solution (c).
You may alternatively go for the worst-case scenario by subtracting the SD of each passenger type from the mean, or the best-case scenario by adding the SD of the full fare to the mean and using the pending seats (leftover from 100) to discount the fare for optimal revenue collection.
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"Vaughn Corporation is considering the issue of commercial paper and would like to know the yield it should offer on its commercial paper. The corporation believes that a 0.2 percent credit risk premium, a 0.1 percent liquidity premium, and a 0.3 percent tax adjustment are necessary to sell its commercial paper to investors. Furthermore, annualized T-bill rates are 7 percent. Based on this information, Vaughn should offer ____ percent on its commercial paper."
Answer:
7.6 percent
Explanation:
Vaughn should offer 7.6 percent on its commercial paper.
This is calculated by adding the 0.2 credit risk premium to 0.1 percent liquidity premium + 0.3 percent tax adjustment + 7 percent annualized t bills rate.
= 0.1 + 0.2 + 0.3 + 7
= 7.6
Based on this Vaughn would offer 7.6 percent on its commercial paper.
Kubin Company’s relevant range of production is 11,000 to 14,000 units. When it produces and sells 12,500 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 7.20 Direct labor $ 4.20 Variable manufacturing overhead $ 1.70 Fixed manufacturing overhead $ 5.20 Fixed selling expense $ 3.70 Fixed administrative expense $ 2.70 Sales commissions $ 1.20 Variable administrative expense $ 0.70 Required: 1. Assume the cost object is units of production: a. What is the total direct manufacturing cost incurred to make 12,500 units? b. What is the total indirect ma
Answer:
a. $142,500
b. $86,250
Explanation:
a. The computation of the total direct manufacturing cost is shown below:
= (Direct material per unit + direct labor per unit) × number of units manufactured
= ($7.20 + $4.20) × 12,500 units
= $142,500
b. The computation of the total indirect manufacturing cost is shown below:
= (Variable manufacturing overhead per unit + Fixed manufacturing overhead per unit) × number of units manufactured
= ($1.70 + $5.20) × 12,500 units
= $86,250
In 2017, Cullumber Corporation incurred research and development costs as follows: Materials and equipment $111000 Personnel 131000 Indirect costs 171000 $413000 These costs relate to a product that will be marketed in 2018. It is estimated that these costs will be recouped by December 31, 2020. The equipment has no alternative future use. What is the amount of research and development costs that should be expensed in 2017
Answer:
The amount of research and development costs that should be expensed in 2017 is $413,000
Explanation:
In order to calculate the amount of research and development costs that should be expensed in 2017 we would have to use the following formula:
amount of research and development costs that should be expensed in 2017= Materials and equipment costs+ Personnel costs+Indirect costs
amount of research and development costs that should be expensed in 2017= $111,000+ $131,000+$171,000
amount of research and development costs that should be expensed in 2017=$413,000
The amount of research and development costs that should be expensed in 2017 is $413,000
The amount of research and development costs that should be expensed in 2020
$ 99000 + $ 119000 + $ 159000
$377,000
Dextra Computing sells merchandise for $15,000 cash on September 30 (cost of merchandise is $12,000). The sales tax law requires Dextra to collect 5% sales tax on every dollar of merchandise sold. Record the entry for the $15,000 sale and its applicable sales tax. Also record the entry that shows the payment of the 5% tax on this sale to the state government on October 15. View transaction list Journal entry worksheet Record the cost of September 30th sales. Note: Enter debits before credits Date General Journal Debit Credit Sep 30 Record entry Clear entry View general journal
Answer and Explanation:
The journal entries are shown below:
1. On Sep 30
Cash $15750
To Sales $15,000
To Sales taxes payable ($15000 ×5%) $750
(Being the cash receipts is recorded)
For recording this we debited the cash as it increased the assets and credited the sales and sales tax payable as it increased the revenue and liabilities
2 On Sep 30
Cost of goods sold $12,000
To Merchandise inventory $12,000
(Being the cost of goods sold is recorded)
For recording this we debited the cost of goods sold as it increased the expenses and credited the merchandise inventory as it reduced the assets
3 On Oct 15
Sales taxes payable $750
To Cash $750
(Being cash paid is recorded)
For recording this we debited the sales tax payable as it reduced the liabilities and credited the cash as it decreased the assets
Assume that at the end of 2019, Clampett, Inc. (an S corporation) distributes property (fair market value of $40,000, basis of $5,000) to each of its four equal shareholders (aggregate distribution of $160,000). At the time of the distribution, Clampett, Inc., has no corporate earnings and profits and J.D. has a basis of $50,000 in his Clampett, Inc., stock. What is J.D.'s stock basis after the distribution
Answer:
J.D.'s stock basis after the distribution is $85,000
Explanation:
In order to calculate the J.D.'s stock basis after the distribution we would have to use the following formula:
J.D.'s stock basis after the distribution=original basis +increase/decrease in basis from gain from property distribution
original basis=$50,000
basis from gain from property distribution=$40,000-$5,000
basis from gain from property distribution=$35,000
Therefore, J.D.'s stock basis after the distribution=$50,000+$35,000
J.D.'s stock basis after the distribution=$85,000
The focused differentiation strategy differs from the differentiation strategy in that Group of answer choices a. the focused differentiators have a broader competitive scope b. the value-creating activities of focused differentiators are more constrained. c. focused differentiators target a narrower customer market d. there are fewer risks with the focused differentiation strategy.
Answer:
The answer is option C) The focused differentiation strategy differs from the differentiation strategy in that focused differentiators target a narrower customer market.
Explanation:
Product differentiation is a marketing strategy that creates competitive advantage with designing a product superior to that of rivals, priced higher and sometimes created for exclusive users.
However, the focused differentiation strategy takes it a step further by targeting a small group of customers with ostensible goods.
The bourgeoisie are the main target for focused differentiators. They have the economic power to foot the bill and they enjoy the exclusivity of being the few to consume such products. A good example of such products is the Bugatti and Ferrari.
Matt and Joel are equal partners in the MJ Partnership. For the current year ended December 31, the partnership has book income of $80,000, which includes the following deductions: (1) guaranteed payments (salaries) to partners: Matt, $35,000; and Joel, $25,000; and (2) charitable contributions, $6,000. The book income amount does not include any sales of capital assets or Sec. 1231 assets or any taxminusexempt income. Based on the above information, what amount should be reported as ordinary income on the partnership return?
Answer:
$86,000
Explanation:
A partnership is a pass through entity that is not taxed directly, but instead its partners are taxed. Even the partners' salaries are recorded as drawings, not salary expense.
The partnership's total ordinary income = book income + any donations or contributions to charities = $80,000 + $6,000 = $86,000
Hancock Medical Supply Co., earned $90,500 of revenue on account during Year 1, its first year of operation. During Year 1, Hancock collected $71,400 of cash from its receivables accounts. The company did not write-off any uncollectible accounts. It estimates that it will be unable to collect 1% of revenue on account. What is the net realizable value of receivables that will be reported on the balance sheet at December 31, Year 1
Answer:
$18,195
Explanation:
The computation of the net realizable value is shown below:
As we know that
Net Realizable Value of Receivables = Ending Accounts Receivable - Estimated Uncollectibles amount
where,
Ending balance of Accounts Receivable is
= Revenue on Account - Accounts collected
= $90,500 - $71,400
= $191,00
And,
Estimated Uncollectibles i.e Bad debt Expense is
= Revenue on Account × given percentage
= $90,500 × 1%
= $905
So, the net realizable value is
= $19,100 - $905
= $18,195
We simply applied the above formula
Farah is an engineer with an idea for a flexible solar energy material that would have a wide range of military and civilian applications. She estimates that she will need approximately $300,000 to develop a prototype. Friends and family could provide about $75,000. She contacts Natalie, an angel investor, for this purpose. In this case, which of the following is likely to be true?a. Farah is unlikely to expect more than just financial support from Natalie.b. Farah is likely to receive a report from Natalie that is more thorough than those by formal venture capitalists.c. Natalie is likely to be a wealthy individual with expertise in the field.d. Natalie is unlikely to be a private investor.
Answer: Natalie is likely to be a wealthy individual with expertise in the field (C)
Explanation:
Based on the information gotten from the question, Farah is an engineer who has an idea for a flexible solar energy material which would have a wide range of civilian and military applications and she needs about $300,000 but has only gotten$75,000.
Farah then gets in touch with Natalie who is an angel investor. An angel investor is a person who gives capital for a business start-up, in exchange for ownership equity or convertible debt.
As an angel investor, to analyze good prospects of the investments, they usually have some expertise in the business field where they want to invest.
Flyaway Travel Company reported net income for 2021 in the amount of $105,000. During 2021, Flyaway declared and paid $3,625 in cash dividends on its nonconvertible preferred stock. Flyaway also paid $25,000 cash dividends on its common stock. Flyaway had 55,000 common shares outstanding from January 1 until 25,000 new shares were sold for cash on April 1, 2021. What is 2021 basic earnings per share?
Answer:
The 2021 basic earnings per share is $1.68
Explanation:
In order to calculate the 2021 basic earnings per share we would have to use the following formula:
Basic EPS = (Net income - Preferred Dividend) / Weighted average common shares outstanding
According to given data:
Net income=$105,000
Preferred Dividend=$3,625
The calculation of the Weighted average common shares outstanding would be as follows:
Period Months Number of shares outstanding Weighted Number
A B A*B /12
Jan 1 to Mar 31 3 55,000 13,750
April 1 to Dec. 31 9 80,000 (55,000 +25,000) 60,000
(40000+10000)
The Weighted average common shares is 60,000
Therefore, Basic EPS = (Net income - Preferred Dividend) / Weighted average common shares outstanding
Basic EPS= ($105,000 - $3,625) / 60,000
Basic EPS=$1.68
Colil Computer Systems, Inc., manufactures printer circuit cards. All direct materials are added at the inception of the production process. During January, the accounting department noted that there was no beginning inventory. Direct materials of $ 300 comma 000 were used in production during the month. Workminusinminusprocess records revealed that 12 comma 500 card units were started in January, 6 comma 250 card units were complete, and 4 comma 000 card units were spoiled as expected. Ending workminusinminusprocess card units are complete in respect to direct materials costs. Spoilage is not detected until the process is complete. What is the direct material cost assigned to good units completed? A. $ 258 comma 621 B. $ 150 comma 000 C. $ 96 comma 000 D. $ 246 comma 000
Answer:
D. $246,000
Explanation:
As per the given question the solution of direct material cost assigned to good units completed is provided below:-
To reach Cost transferred out we need to follow some steps which is following below:-
Step 1. Cost per unit = cost of material used ÷ Units started
= $300,000 ÷ 12,500
= $24
Now,
Step 2. Goods units completed = Started units × Cost per unit
= 6,250 × $24
= $150,000
Step 3. Normal spoilage = Cards units × Cost per unit
= 4,000 × $24
= $96,000
and finally
Cost transferred out = Goods units completed + Normal spoilage
= $150,000 + $96,000
= $246,000
To reach allocation of Cost transferred out we simply put the values into formula.
Machine Replacement Decision A company is considering replacing an old piece of machinery, which cost $400,000 and has $175,000 of accumulated depreciation to date, with a new machine that has a purchase price of $550,000. The old machine could be sold for $250,000. The annual variable production costs associated with the old machine are estimated to be $72,500 per year for eight years. The annual variable production costs for the new machine are estimated to be $24,000 per year for eight years. a.1 Prepare a differential analysis dated May 29 to determine whether to continue with (Alternative 1) or replace (Alternative 2) the old machine. If an amount is zero, enter "0". If required, use a minus sign to indicate a loss.
Answer:
Decision : It would be better to Replace Old Machine
Explanation:
Check the file attached for proper arrangement and explanation of the solution. Thank you.
Blue Ridge Bicycles uses a standard part in the manufacture of several of its bikes. The cost of producing 40,000 parts is $138,000, which includes fixed costs of $73,000 and variable costs of $65,000. By outsourcing the part, the company can avoid 30% of the fixed costs. If Blue Ridge Bicycles buys the part, what is the most Blue Ridge Bicycles can spend per unit so that operating income equals the operating income from making the part
Answer:
$2.17
Explanation:
The computation of maximum amount per unit is shown below:-
First we need to compute the avoidable fixed coast and total cost of making to reach maximum amount per unit
Avoidable fixed cost = Fixed cost × Fixes cost percentage
= $73,000 × 30%
= $21,900
Total cost of making = Variable cost + Avoidable fixed cost
= $65,000 + $21,900
= $86,900
Maximum amount per unit = Total cost of making ÷ Producing cost
= $86,900 ÷ 40,000
= $2.17
Therefore, for computing the maximum amount per unit we simply divide the total cost of making by producing cost.
Problem 7-18 Variable and Absorption Costing Unit Product Costs and Income Statements [LO7-1, LO7-2]Haas Company manufactures and sells one product. The following information pertains to each of the company’s first three years of operations: Variable costs per unit: Manufacturing: Direct materials$20Direct labor$12Variable manufacturing overhead$7Variable selling and administrative$3Fixed costs per year: Fixed manufacturing overhead$110,000Fixed selling and administrative expenses$50,000 During its first year of operations, Haas produced 40,000 units and sold 40,000 units. During its second year of operations, it produced 55,000 units and sold 30,000 units. In its third year, Haas produced 20,000 units and sold 45,000 units. The selling price of the company’s product is $46 per unit. Required:1. Compute the company’s break-even point in unit sales.2. Assume the company uses variable costing:a. Compute the unit product cost for Year 1, Year 2, and Year 3.b. Prepare an income statement for Year 1, Year 2, and Year 3.3. Assume the company uses absorption costing:a. Compute the unit product cost for Year 1, Year 2, and Year 3.b. Prepare an income statement for Year 1, Year 2, and Year 3.
Answer and Explanation:
As per the data given in the question,
a)
For computation of contribution margin per unit first we need to find out the contribution margin per unit and fixed expenses which is shown below:-
Contribution margin per unit = Selling price per unit - Variable cost per unit
= $46 - ($20 + $12 + $7 + $3)
= $46 - $42
= $4
Fixed expenses = Fixed manufacturing overhead + Fixed selling and administrative expenses
= $110,000 + $50,000
= $160,000
Break-even units = Fixed expenses ÷ Contribution margin per unit
= $160,000 ÷ 4
= 40,000 units
2. a The Computation of unit product cost is shown below:-
Particulars Year 1 Year 2 Year 3
Unit product cost :
Direct material $20 $20 $20
Direct labor $12 $12 $12
Variable manufacturing
overhead $7 $7 $7
Unit product cost $39 $39 $39
b. The preparation of Income statement is shown below:-
Income statement
Haas Company
Particulars Per unit Year 1 Year 2 Year 3
Sales unit 40,000 30,000 45,000
Sales $46 $1,840,000 $1,380,000 $2,070,000
Less:
Variable cost :
Variable manufacturing
cost $39 $1,560,000 $1,170,000 $1,755,000
Variable selling and
administrative cost $3 $120,000 $90,000 $135,000
Total variable cost $42 $1,680,000 $1,260,000 $1,890,000
Contribution margin $4 $160,000 $120,000 $180,000
Fixed expenses :
Fixed Manufacturing
overhead $110,000 $110,000 $110,000
Fixed selling and
administrative expense $50,000 $50,000 $50,000
Net Operating Income $0 -$40,000 $20,000
3. a. The computation of unit product cost for Year 1, Year 2, and Year 3 is shown below:-
Particulars Year 1 Year 2 Year 3
Produced units 40,000 55,000 20,000
Unit Product Cost:
Direct material $20 $20 $20
Direct labor $12 $12 $12
Variable manufacturing
overhead $7 $7 $7
Fixed manufacturing
overhead $2.75 $2 $5.5
($110,000 ÷ Number of unit produced)
Total cost of produced unit $41.75 $41 $44.5
3. b The Preparation of income statement for Year 1, Year 2, and Year 3 is attached in the spreadsheet.
On January 1, 20X1, Popular Creek Corporation organized SunTime Company as a subsidiary in Switzerland with an initial investment cost of Swiss francs (SFr) 80,000. SunTime’s December 31, 20X1, trial balance in SFr is as follows:Part 1. Prepare a schedule translating (current rate method) the December 31, 20X1, trial balance from Swiss francs to dollars.
On January 1, 20X1, Popular Creek Corporation organized SunTime Company as a subsidiary in Switzerland with an initial investment cost of Swiss francs (SFr) 80,000. SunTime’s December 31, 20X1, trial balance in SFr is as follows:
Then intended files that supposed to be here are added in the attachments below:
Part 1. Prepare a schedule translating (current rate method) the December 31, 20X1, trial balance from Swiss francs to dollars.
Answer:
Explanation:
We are tasked to Prepare a schedule translating (current rate method) the December 31, 20X1, trial balance from Swiss francs to dollars.
Schedule remeasuring Swiss francs to dollars
Trial Balance Translation Schedule
December 31, 20X1
Sfr Exchange Rate U.S dollar
Cash $7,200 0.73 $5,256
Accounts $25,000 0.73 $18,250
receivable (net)
Receivable from $6,300 0.73 $4,599
Creek
Inventory $26,000 0.73 $18,980
Plant & equipment $110,000 0.73 $80,300
Cost of good sold $71,500 0.75 $53,625
Depreciation expense $10,100 0.75 $7,575
Operating expense $35,000 0.75 $26,250
Dividends paid $16,400 0.74 $12,136
Total: $307,500 $226,971
[tex]Accumulated - \ translation \\other \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ \ adjustment\\Comprehensive \\ loss[/tex] (233,031 - 226,971) $6060
TOTAL DEBITS $233,031
Accumulated $10,100 0.73 $7,373
Depreciation
Account $13,600 0.73 $9,928
Payable
Bond $51,000 0.73 $37,230
Payable
Common stock $78,000 0.80 $62,400
Sales $154,800 0.75 $116,100
Total: $307,500 $233,031
No entry necessary $ -
TOTAL CREDITS $233,031
On January 1, 2020, Pina Corporation sold a building that cost $263,240 and that had accumulated depreciation of $101,140 on the date of sale. Pina received as consideration a $253,240 non-interest-bearing note due on January 1, 2023. There was no established exchange price for the building, and the note had no ready market. The prevailing rate of interest for a note of this type on January 1, 2020, was 11%. At what amount should the gain from the sale of the building be reported?
Answer:
Gain from sale = $23,067
Explanation:
the none interest bearing note must be recorded at present value:
present value of the note = face value / (1 + r)ⁿ
face value = $253,240r = 11%n = 3PV = $253,240 / (1 + 11%)³ = $185,167
the note receivable must be recorded at $253,240, but $68,073 will be recorded as interest revenue.
the journal entry for the transaction should be:
January 1, 2020, sale of a building:
Dr Notes receivable 253,240
Dr Accumulated depreciation 101,140
Cr Building 263,240
Cr Interest revenue 68,073
Cr Gain from sale 23,067
he income statement of Sarasota Company is shown below. SARASOTA COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2020 Sales revenue $6,890,000 Cost of goods sold Beginning inventory $1,910,000 Purchases 4,410,000 Goods available for sale 6,320,000 Ending inventory 1,620,000 Cost of goods sold 4,700,000 Gross profit 2,190,000 Operating expenses Selling expenses 460,000 Administrative expenses 700,000 1,160,000 Net income $1,030,000 Additional information: 1. Accounts receivable decreased $350,000 during the year. 2. Prepaid expenses increased $160,000 during the year. 3. Accounts payable to suppliers of merchandise decreased $300,000 during the year. 4. Accrued expenses payable decreased $90,000 during the year. 5. Administrative expenses include depreciation expense of $50,000. Prepare the operating activities section of the statement of cash flows using the direct method.
Answer:
Cash flow from operating activities
Cash Receipts from Customers $7,240,000
Cash Paid to Suppliers and Employees ($6,460,000)
Net Cash from Operating Activities $780,000
Explanation:
Prepare a statement of cash flows` operating activities section as follows :
Cash flow from operating activities
Cash Receipts from Customers $7,240,000
Cash Paid to Suppliers and Employees ($6,460,000)
Net Cash from Operating Activities $780,000
Cash Receipts from Customers Calculations
Sales revenue $6,890,000
Add Decrease in Accounts Receivables $350,000
Cash Receipts from Customers $7,240,000
Cash Paid to Suppliers and Employees Calculations
Cost of goods sold $4,700,000
Add
Selling expenses $460,000
Administrative expenses $700,000
Less depreciation expense of $50,000
Decrease in Accounts Payable $300,000
Decrease in Accrued Expenses $90,000
Increase in Prepaid expenses $160,000
Cash Paid to Suppliers and Employees $6,460,000
In performing accounting services for small businesses, you encounter the following situations per taining to cash sales. 1. Poole Company enters sales and sales taxes separately in its cash register. On April 10, the register totals are sales $30,000 and sales taxes $1,500. 2. Waterman Company does not segregate sales and sales taxes. Its register total for April 15 is $25,680, which includes a 7% sales tax. Prepare the entry to record the sales transactions and related taxes for each client.
Answer and Explanation:
According to the scenario, journal entries of the given data are as follow:-
1.Journal Entry of Poole Company
April 10
Cash A/c Dr. $31,500
To Sales A/c $30,000
To Sales tax payable A/c $1,500
(Being the sales and sales tax payable is recorded)
2. Since Register total for April $25,680 includes 7% sales tax.
So Sales of Waterman Company
= Registered Total Amount ÷ (1 + Sales Tax Rate)
= $25,680 ÷ (1 + 7%)
= $25,680 ÷ 1.07
= $24,000
Now
Sales tax = $24,000 × 7% = $1,680
Journal Entry of Waterman Company
On 15 April
Cash A/c Dr. $25,680
To Sales A/c $24,000
To Sales tax payable A/c $1,680
(Being the sales and sales tax payable is recorded)
Please help ASAP giving BRAINLIEST , Did I get this correct?
Answer:
No, in my opinion I would choose:
A) the properties of free-market system that determine what the outcomes will be.
Explanation:
That would be my answer because the definition of market forces is "the economic factors affecting the price of, demand for, and availability of a commodity."(off the internet) and the answer which fits that definition the most in my opinion is A.
That would be my answer at least.
Hope this helps!
