Lisa works as a nanny and is paid in cash by the family she works. She does not declare her earnings to the internal revenue service (IRS). Given this information, it can be said that Lisa is part of the underground economy.
The internal revenue service or IRS is a United States government agency collection of taxes and enforcement of tax laws like the wash sale rule.
The wash sale rule is when you sell stocks online for a loss and then purchase the same stocks within 30 days from the date of sale.
The underground economy is the part of the country's economic that is not recorded and untaxed by the government.
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Consider an economy in which money does not exist, so that agents rely on barter to carry out transactions. When the economy was small, barter seemed sufficient. However, the economy has now begun to grow. If people in this economy trade five goods, the price tag of each good must list____prices, and the economy requires____prices for people to carry out transactions. Suppose that the number of goods people trade increases to 17. Then the price tag of each good must list____prices, and the number of prices that the economy requires increases to____.
Now suppose that our economy has a money. The government now issues a national currency and there is no longer any barter. In this economy, money and currency are not the same because:____.
1. The fact that the government issues currency means that the currency will be accepted as money by all agents.
2. The fact that the currency is backed by the government means that it will never lose value and will remain a perfect unit of account.
3. Just because the government issues currency does not mean that the currency will be accepted as money, since it must be used as a medium of exchange, store of value and standard of value.
4. Just because the government issues currency does not mean that the currency will be accepted as money, and buyers and sellers still need barter to ensure that money does not lose its value.
Suppose now that our economy is suffering from rapid, ongoing increases in the cost of living. Which characteristic of money is directly negatively impacted in that economy?
1.Medium of exchange.
2.Double coincidence of wants.
3.Store of value.
4.Unit of account.
Answer:
4. Just because the government issues currency does not mean that the currency will be accepted as money, and buyers and sellers still need barter to ensure that money does not lose its value.
Suppose now that our economy is suffering from rapid, ongoing increases in the cost of living. Which characteristic of money is directly negatively impacted in that economy?
3.Store of value.
Explanation:
When a capital budgeting project generates a positive net present value, this means that the project earns a return higher than the
When a capital budgeting project generates a positive net present value, this means that the project earns a return higher than the internal rate of return.
For better understanding, lets explain what capital budgeting means
Capital Budgeting is simply known as the process of evaluating and selecting long-term investments that are always in line with an organisation's goal of maximizing owners' wealth. the four main administrative steps to the capital budgeting process includes idea generation , analyzing project proposals , create the firm-wide capital budget and monitoring decisions and conducting a post-auditfrom the above, we can therefore say that the answer When a capital budgeting project generates a positive net present value, this means that the project earns a return higher than the internal rate of return, is correct
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In the context of the entrepreneurial strategy matrix, a ________ is most likely to have the highest risks and returns. Select one: A. new passenger vehicle B. lawn mowing service C. tax preparation service D. clothing outfit E. new restaurant
Answer:
E. new restaurant
Explanation:
The entrepreneurial strategy matrix is a interesting model for the ongoing ventures an d the new ventures. It helps to identify the proper business strategies.
In the context, according to the entrepreneurial strategy matrix, a new restaurant is most likely to have a high risk and high returns as there is a lot of competition and rivalries in the restaurant industry in the market. Many people already have their favorite restaurant and they prefer going to their favorite or their selected restaurant.
So there is a risk in setting up a new restaurant which requires large investments without properly studying the market. On the other hand if a new restaurant manages to serve some really tasty and hygiene food to their customers, customers will prefer coming to this restaurant and this in turn will provide huge returns to the owners.
Last year Viera Corp had $155,000 of assets, $305,000 of sales, $20,000 of net income, and a debt-to-total-capital ratio of 37.5%. The new CFO believes a new computer program will enable it to reduce costs and thus raise net income to $33,000. Assets, total invested capital, sales, and the debt to capital ratio would not be effected. By how much would the cost reduction improve the ROE?
Answer:
13.41%
Explanation:
Calculation for By how much would the cost reduction improve the ROE
First step
Debt value = $155,000 × 37.5%
Debt value = $58,125
Second step
Equity value = $155,000 - $58,125
Equity value $96,875
Third step
= (Net income ÷ Total equity) × 100
Ratio = ($20,000 ÷ $96,875) × 100 = 20.65%
New ROE would be = ($33,000 ÷ $96,875) × 100 = 34.06%
Fourth step
Change in ROE= New ROE - Old ROE
ROE= 34.06% - 20.65%
ROE= 13.41%
Therefore By how much would the cost reduction improve the ROE is 13.41%
preparing adjusting and closing entries across two periods norton company closes its accounts on december 31 each year. the company works a five-day work week and pays its employees every two weeks. on december 31, 2015, norton accrued $1,880 of salaries payable. on january 7, 2016, the company paid salaries of $4,800 cash to employees.
Answer:
Requirement: Prepare journal entries to: (a) Accrue the salaries payable on December 31, b) Close the Salaries Expense account on December 31 (the account has a year-end balance of $250,000 after adjustments), (c) Record the salary payment on January 7
Date Accounts title and Explanation Debit Credit
31-Dec Salaries expense $1,880
Salaries Payable $1,880
(To record accrued salaries )
31-Dec Retained Earnings $250,000
Salaries Expense $250000
(To close salaries expense account)
07-Jan Salaries Payable $1,880
Salaries expense $2,920
Cash $4,800
(To record payment of salary)
The Manda Panda Company uses the allowance method to account for bad debts. At the beginning of 2009, the allowance account had a credit balance of $75,000. Credit sales for 2009 totaled $2,400,000 and the year-end accounts receivable balance was $490,000. During this year, $73,000 in receivables were determined to be uncollectible. Manda Panda anticipates that 3% of all credit sales will ultimately become uncollectible. The fiscal year ends on December 31.
Required:
1. Does this situation describe a loss contingency? Explain.
2. What is the bad debt expense that Manda Panda should report in its 2009 income statement?
3. Prepare the appropriate journal entry to record the contingency.
4. What is the net realizable value (book value) Manda Panda should report in its 2009 balance sheet?
Answer:
The Manda Panda Company
1. This is not a loss contingency. A loss contingency refers to a probable payment that might result from an uncertain event.
2. The bad debt expense that Manda Panda should report in its 2009 income statement is $70,000 ($73,000 -$75,000 + $72,000).
3. Debit Allowance for Uncollectible accounts $3,000
Credit Bad Debts Expense $3,000
To reduce the allowance account from $75,000 to $72,000.
Debit Bad Debts Expense $73,000
Credit Accounts Receivable account $73,000
To write-off the bad debts.
4. The net realizable value of accounts receivable is $418,000 ($490,000 - 72,000)
Explanation:
a) Data and Calculations:
Allowance for Uncollectible account (credit balance) = $75,000
Credit sales for 2009 = $2.4 million
Year-end Accounts Receivable = $490,000
Bad Debts = $73,000
Estimated allowance for Uncollectible = 3% of all credit sales (3% of $2.4 million) = $72,000
b) A contingency loss requires that a liability be created to account for the loss. This is not the case with making allowances for uncollectible accounts or writing off bad debts. There is no need to create a liability account since no payment will eventually be made to settle any liability in the future.
Effective April 1, 2016. The Syracuse Corporation, which has a year- end of December 31st, authorized $1.500.000 of callable, mortgage bonds (secured by $2,200,000 of property and equipment, at market value). The bonds paid interest at a rate of eight percent per year and had a term of six years. Interest was payable each September 30th and March 31. On July 1, 2017, Syracuse issued 1,000 of the bonds in exchange for cash in the total amount of $906,000. On October 1, 2019, Syracuse called the bonds and paid the current bondholders $1,150,000 in cash. Prepare the journal entries related to the bonds that the corporation entered into its records during the period April 1, 2016 through December 31, 2017 In addition, prepare the journal entry that was recorded when the bonds were redeemed in October 2019.
Answer:
April 1 2016
No Entry
July 1, 2017
Dr Cash $906,000
Dr Discount on bonds payable $94,000
Cr Bonds payable $1,000,000
Sep 30 2017
Dr Interest Expense $23,917
Cr Discount on bonds payable $3,917
Cr Cash $20,000
Dec 31,2017
Dr Interest Expense $23,917
Cr Discount on bonds payable $3,917
Cr Interest payable $20,000
October 1 2019
Dr Bonds payable $1,000,000
Dr Loss on early extinguishment of bonds $208,750
Cr Discount on bonds payable $58,750
Cr Cash $1,150,000
Explanation:
Preparation of the journal entries related to the bonds that the corporation entered into its records during the period April 1, 2016 through December 31, 2017
April 1 2016
No Entry
July 1, 2017
Dr Cash $906,000
Dr Discount on bonds payable $94,000
($1,000,000-$906,000)
Cr Bonds payable $1,000,000
(Being to record issue bond for cash $906,000 and discount on bonds)
Sep 30 2017
Dr Interest Expense $23,917
[(1,000,000*8%*3/12)+($94,000/72months*3)]
(=$20,000+$3,917)
Cr Discount on bonds payable $3,917
($94,000/72months*3)
Cr Cash $20,000
(1,000,000*8%*3/12)
(Being to record interest paid and discount amortized)
Dec 31,2017
Dr Interest Expense $23,917
[(1,000,000*8%*3/12)+($94,000/72months*3)]
(=$20,000+$3,917)
Cr Discount on bonds payable $3,917
($94,000/72months*3)
Cr Interest payable $20,000
(1,000,000*8%*3/12)
(Being to record interest accrued and discount amortized)
Preparation of the journal entry that was recorded when the bonds were redeemed in October 2019
October 1 2019
Dr Bonds payable $1,000,000
Dr Loss on early extinguishment of bonds $208,750
($1,150,000+$58,750-$1,000,000)
Cr Discount on bonds payable $58,750
[$94,000-($94,000/72)*27]
($94,000-$35,250=$58,750)
Cr Cash $1,150,000
(Being to record Redemption of bonds and discount Amortized)
Is anyone good at introduction to business?
Answer:
Yeah I'm good with business too
Explanation:
Identifying the Five Steps in the Revenue Recognition Process
Match each step 1 through 5 with the sales process described in a through e.
Step 1: identify contract(s) with customer.
Step 2: identify performance obligation(s) in the contract.
Step 3: determine transaction price.
Step 4: allocate transaction price to performance obligation(s).
Step 5: Recognize revenue when (or as) each performance obligation is satisfied through a transfer of control
a. The total price for the computer and two years of services is $800.
b. Customer takes possession of the computer and benefits from the data service over two years.
c. Customer will receive the computer immediately and will benefit from two years of data services for the tablet.
d. The standalone selling price of the computer is $500 and of the two-year service contract is $300.
e. Customer agrees to purchase one computer plus two years of data services for an agreed upon price.
Answer:
Step 1: Identify contract(s) with customer
Correct Match: Customer agrees to purchase one computer plus two years of data services for an agreed upon price.
Step 2: identify performance obligation(s) in the contract
Correct Match: Customer will receive the computer immediately and will benefit from two years of data services for the tablet.
Step 3: Determine transaction price
Correct Match: The total price for the computer and two years of services is $800.
Step 4: Allocate transaction price to performance obligation(s)
Correct Match: The standalone selling price of the computer is $500 and of the two-year service contract is $300.
Step 5: Recognize revenue when (or as) each performance obligation is satisfied through a transfer of control
Correct Match: Customer takes possession of the computer and benefits from the data service over two years.
Problem 11-5 Sensitivity Analysis and Break-Even [LO1, 3]We are evaluating a project that costs $583,800, has a six-year life, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 90,000 units per year. Price per unit is $41, variable cost per unit is $27, and fixed costs are $695,000 per year. The tax rate is 25 percent, and we require a return of 9 percent on this project. a-1.Calculate the accounting break-even point. (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) a-2.What is the degree of operating leverage at the accounting break-even point
Answer:
It was nice... friend.
Explanation:
Match each definition with its related term by selecting the appropriate letter in the drop down provided. There should be only one definition per term. (that is, there are more definitions than terms.)
Definitions:
A. Report the long life of a company in shorter periods.
B. Record expenses when incurred in earning revenue.
C. The time it takes to purchase goods or services from suppliers, sell goods or services to customers, and collect cash from customers.
D. Record revenues when earned and expenses when incurred.
E. Increases in assets or decreases in liabilities from peripheral transactions.
F. An asset account used to record cash paid before expenses have been incurred.
G. Record revenues when earned and measurable (when the company transfers promised goods or services to customers, and in the amount the company expects to receive).
H. Decreases in assets or increases in liabilities from peripheral transactions.
I. Record revenues when received and expenses when paid.
J. The income statement equation.
K. Decreases in assets or increases in liabilities from central ongoing operations.
L. The retained earnings equation.
M. A liability account used to record cash received before revenues have been earned.
1. Expenses
2. Gains
3. Revenue recognition principle
4. Cash basis accounting
5. Unearned revenue
6. Operating cycle
7. Accrual basis accounting
8. Prepaid expenses
9. Revenues − Expenses = Net Income
10. Ending Retained Earnings = Beginning Retained Earnings + Net Income − Dividends Declared
Answer:
A. Going concern
B. Accrual Basis accounting
C. Operating Cycle
D. Cash Basis Accounting
E. Gains
F. Prepaid Expense
G. Revenue recognition principle
H. Expenses
I. Cash basis Accounting
J. Revenue - Expenses = Net Income
K. Expense
L. Ending Retained Earning = Beginning Retained Earning + Net Income - Dividends Declared
M. Unearned Revenue
Explanation:
The definitions for each letter are matched with the accounting terms. The unearned revenue account is used to record the revenue received but services yet to be delivered. This is a liability account in which the company reports any unearned revenue.
Your firm has a credit rating of Baa. You notice that the credit spread for five-year maturity Baa debt is 150 basis points (1.50%). Your firm is issuing a five-year 5% semiannual coupon bond. You see that new five-year Treasury notes are being issued at par with a coupon rate of 3.5%. Should your bond be issued at par, at a discount, or at a premium?
Answer: Par
Explanation:
The credit spread measures the difference between the risk free rate/ yield for a certain type of security and the yield the security offers.
The credit spread here is 1.50%.
The risk free rate is 3.5%.
The expected yield in the market for the type of security you are issuing is therefore:
= 3.5% + 1.50%
= 5.00%
Your Baa bond is expected to have a yield of 5% which is the coupon rate you are issuing it at.
Bond will therefore be issued at Par which is what happens when the Coupon and the Yield are equal.
Vulcan Companyâs contribution format income statement for June is as follows:
Vulcan Company Income Statement For the Month Ended June 30
Sales $750,000
Variable expenses 336,000
Contribution margin 414,000
Fixed expenses 378,000
Net operating income $36,000
Management is disappointed with the companyâs performance and is wondering what can be done to improve profits. By examining sales and cost records, you have determined the following:
a. The company is divided into two sales territoriesâNorthern and Southern. The Northern territory recorded $300,000 in sales and $156,000 in variable expenses during June; the remaining sales and variable expenses were recorded in the Southern territory. Fixed expenses of $120,000 and $108,000 are traceable to the Northern and Southern territories, respectively. The rest of the fixed expenses are common to the two territories.
b. The company is the exclusive distributor for two productsâPaks and Tibs. Sales of Paks and Tibs totaled $50,000 and $250,000, respectively, in the Northern territory during June. Variable expenses are 22% of the selling price for Paks and 58% for Tibs. Cost records show that $30,000 of the Northern territoryâs fixed expenses are traceable to Paks and $40,000 to Tibs, with the remainder common to the two products.
Required:
Prepare contribution format segmented income statements.
Answer:
Vulcan Companya. Segmented Income Statement For the Month Ended June 30
Northern Southern Total
Sales $300,000 $450,000 $750,000
Variable expenses 156,000 180,000 336,000
Contribution margin 144,000 270,000 414,000
Fixed expenses:
Traceable 120,000 108,000 228,000
Non-traceable 150,000
Net operating income $24,000 $162,000 $36,000
b) Segmented Income Statements for the Northern Territory:
Paks Tibs Total
Sales $50,000 $250,000 $300,000
Variable expenses 11,000 145,000 156,000
Contribution margin $39,000 $105,000 $144,000
Fixed expenses:
Traceable 30,000 40,000 70,000
Non-Traceable 50,000
Net operating income $9,000 $65,000 $24,000
Explanation:
a) Data and Calculations:
Vulcan Company
Income Statement For the Month Ended June 30
Sales $750,000
Variable expenses 336,000
Contribution margin 414,000
Fixed expenses 378,000
Net operating income $36,000
Imagine that your country takes in $100 million each year in tax money but chooses to spend $500 million on various services it provides. What type of stance does your country take on fiscal policy?
A.) expansionary stance
B.) contractionary stance
C.) economic stance
D.) neutral stance brainly
What are the benefits of outsourcing
Compute the price of an American call option with strike K = 110 and maturity T = .25 years. See 1. American Put Option excel sheet - A 15-period binomial model The price of the American call option = 2.604
You have just purchased ten municipal bonds, each with a $1,000 par value, for $9,500. You purchased them immediately after the previous owner received semiannual coupon payments. The bond rate is 6.6% per year payable semiannually. You plan to hold the bonds for 5 years, selling them immediately after you receive the coupon payment. If your desired nominal yield is 12% per year compounded semiannually, what will be your minimum selling price for the bonds
Answer:
$12,663.26
Explanation:
The computation of the minimum selling price is shown below
Semi-annual = 12% ÷ 2 = 6%
Semi-annual compounding periods = 5 × 2 = 10
Semi-annual coupon (for 10 bonds) = $10,000 × 6.6% x (1 ÷ 2) = $330
as we know that
We assume the selling price be S
Present worth (PW) of the bond= PW of future cash flows
$9,500 = $330 × P/A(6%, 10) + S × P/F(6%, 10)
$9,500 = $330 × 7.3601 + S × 0.5584
$9,500 = $2,428.83 + S × 0.5584
S × 0.5584 = $7,071.17
= $7,071.17 ÷ 0.5584
= $12,663.26
Parmesan Company uses the direct method for its statement of cash flow. It reports the following information regarding the year 2014: From the income statement: Sales Revenues, $265,000 Cost of Goods Sold, $210,000 Operating expenses, $31,000 From the balance sheet: Beginning BalanceEnding Balance Accounts Receivable:$14,500$17,800 Inventory:23,50017,800 Accounts Payable:6,00013,500 Accrued Liabilities:4,0001,500 On the statement of cash flows, what amount will be shown for payments to suppliers for inventory purchases
Answer: $196,800
Explanation:
The cash payments to suppliers for inventory purchases will be:
= Cost of goods sold - Decrease in inventory - Increase in accounts payable
Decrease in inventory = 23,500 - 17,800
= $5,700
Increase in accounts payable
= 13,500 - 6,000
= $7,500
Cash to suppliers for inventory = 210,000 - 5,700 - 7,500
= $196,800
Solve each of the following three problems, all of which involve borrowing money from a bank with an APR of 6.5% compounded annually. Look carefully at how the problems differ from one another, in spite of appearing similar. In your solutions, say a few words explaining how you can tell which is the appropriate formula to apply in each case.
a. Suppose that you borrow $1000 once per year, beginning today, and ending 10 years from now (so you borrow your last $1000 on the ten year anniversary of today’s date). How much will your total debt be at the end of the 10th year?b. Suppose that you borrow $10,000 today. You repay the loan over the course of ten years, making a payment every year on the anniversary of today’s date. The first payment will be one year from today, and the last payment will be ten years from today. How much should each payment be?c. Suppose that you borrow $10,000 today, and repay the loan all at once, on the ten year anniversary of today’s date. How much will you have to repay on that date?
Answer:
a. The formula is annuity immediate. This requires annual addition at the end of each period. The total debt at the end of the 10th year is $16,248.70.
b. Amortized loan repayment is applicable here since the loan and interest are repaid every year. Therefore, the payment every year is: $1,391.05.
c. The compound interest formula is used here since the interest accumulates annually but repayment of loan is due at the end of 10 years. The total debt due for repayment at the end of the 10th year is $18,771.37.
Explanation:
1. Data and Calculations:
Starting Principal = $1000
Annual Addition = $1000
Annual interest rate = 6.5%
Period of loan = 10 years
The formula is annuity immediate. This requires annual addition at the end of each period.
Using the annuity calculator for annual addition at the end of each period, the loan's:
End Balance $16,248.70
Total Principal $11,000.00
Total Interest $5,248.70
2. Starting Principal = $10,000
Annual interest rate = 6.5%
Period of loan = 10 years
Amortized loan repayment is applicable here since the loan and interest are repaid every year. Therefore, the payment every year is: $1,391.05
Total of 10 Payments $13,910.47
Total Interest $3,910.47
3. Starting Principal = $10,000
Annual interest rate = 6.5%
Period of loan = 10 years
Compound interest formula is used here since the interest accumulates annually but repayment of loan is due at the end of 10 years.
Using an online financial calculator, the future debt will total $18,771.37 with a total compounded interest of $8,771.37 ($18,771.37 - $10,000).
FV = $18,771.37
Total Interest $8,771.37
On December 31, 2010, Beckford Company issues 150,000 stock-appreciation rights to its officers entitling them to receive cash for the difference between the market price of its stock and a pre-established price of $10. The fair value of the SARs is estimated to be $4 per SAR on December 31, 2011; $1 on December 31, 2012; $10 on December 31, 2013; and $9 on December 31, 2014. The service period is 4 years, and the exercise period is 7 years.Instructions:(a) Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan.(b) Prepare the entry at December 31, 2014, to record compensation expense, if any, in 2014.(c) Prepare the entry on December 31, 2014, assuming that all 150,000 SARs are exercised.
Answer:
Beckford Company
a) A schedule of Compensation Expense for each year:
Stock-Appreciation Rights (SARs):
Date Due SARs Fair Value Compensation Annual %
of SARs Recognizable Expenses
December 31, 2011 150,000 $4 $600,000 $150,000 (25%)
December 31, 2012 150,000 $1 150,000 37,500 (25%)
December 31, 2013 150,000 $10 $1,500,000 375,000 (25%)
December 31, 2014 150,000 $9 $1,350,000 337,500 (25%)
Total SARs Compensation Expense for the 4 years = $900,000
b) Journal Entry at December 31, 2014 to record compensation expense:
Debit Compensation Expense (SARs) $337,500
Credit SARs Liability $337,500
To record the compensation expense for 2014.
c) Debit Compensation Expense (SARs) $900,000
Credit SARs Liability $900,000
To record the compensation expense for the four years.
Explanation:
a) Data and Calculations:
Stock-appreciation rights = 150,000
Period of exercise = 4 years
Portion exercisable each year = 37,500 (150,000/4)
Pre-established price of SARs = $10
Fair values of the SARs are:
December 31, 2011 = $4
December 31, 2012 = $1
December 31, 2013 = $10
December 31, 2014 = $9
b) Stock Appreciation Rights (SARs), like stock options, compensate Beckford employees during a predetermined period of four years with the difference between the stock's market price and a predetermined price of $10. Since the SARs are exercisable over four years, the compensation expense is based on the portion of the stock that is exercisable each year (which is 150,000 divided by 4). It differs from stock options because employees are entitled to a cash payment or stock issuance at the end of the period, whereas employees pay for stock options when they exercise them.
As a worker, will you work properly even if the boss is not around? Yes or no?
Answer:
Yes
Explanation:
Because it is our duty to work properly even the boss is around or not
Answer:
Yes
Explanation:
No matter what you're getting paid for what you have to so & its your job no matter what and as growing up you become responsible for your actions
Hillman Corporation reported a decrease in accounts receivable of $391,216. This is best defined as a _________ of cash on the _______________ segment on the statement of cash flows. source of cash; investing activities use of cash; operating activities use of cash investing activities source of cash; operating activities source of cash financing activities use of cash financing activities
Answer:
This is best defined as a SOURCE of cash on the OPERATING segment on the statement of cash flows.
Explanation:
The operating sector of the cash flow statement includes net income plus any adjustments that include depreciation expense, changes in accounts receivables, inventories, accounts payables, etc.
A decrease in accounts receivable increases operating cash flows.
Stanislaw Timber Company owns 9,000 acres of timberland purchased in 2009 at a cost of $1,400 per acre. At the time of purchase, the land without the timber was valued at $400 per acre. In 2010, Stanislaw built fire lanes and roads, with a life of 30 years, at a cost of $84,000. Every year, Stanislaw sprays to prevent disease at a cost of $3,000 per year and spends $7,000 to maintain the fire lanes and roads. During 2011, Stanislaw selectively logged and sold 700,000 board feet of timber, of the estimated 3,500,000 board feet. In 2012, Stanislaw planted new seedlings to replace the trees cut at a cost of $100,000.
Instructions
a. Determine the depreciation expense and the cost of timber sold related to depletion for 2011.
b. Stanislaw has not logged since 2011. If Stanislaw logged and sold 900,000 board feet of timber in 2022, when the timber cruise (appraiser) estimated 5,000,000 board feet, determine the cost of timber sold related to depletion for 2022.
Answer:
a. Depreciation expense = Cost/Life = $84,000/30 = $2,800 per year
b. Cost of timber sold = Per arce - Land value = $1,400 - $400 = $1,000
Timber value = Cost of timber sold * Acre = $1,000 * 9,000 acres = $9,000,000
Land value = Timber value/Estimated Board feet * Sold Board feet = 9,000,000/3,500,000 * 700,000 = $1,800,000
Total Cost of timber sold = Timber value - Land value = $9,000,000 - $1,800,000 = $7,200,000
Depletion = Timber value * [Total Cost of timber sold+Replacement cost/Estimated Board feet]
Depletion = $900,000 * $7,200,000+$100,000/5,000,000
Depletion = $900,000 * 1.46
Depletion = $1,314,000
Acker Inc. bought 40% of Howell Co. on January 1, 2020 for $576,000. The equity method of accounting was used. The book value and fair value of the net assets of Howell on that date were $1,440,000. Acker began supplying inventory to Howell as follows:
Year Cost to Acker Transfer Price Amount Held by Howell at Year-End
2020 $55,000 $75,000 $15,000
2021 $70,000 $110,000 $55,000
Howell reported net income of $100,000 in 2010 and $120,000 in 2011 while paying $40,000 in dividends each year. What is the amount of unrealized intra-entity inventory profit to be deferred on December 31, 2010?
Answer:
the amount of unrealized intra-entity inventory profit is $1,600
Explanation:
The computation of the amount of unrealized intra-entity inventory profit is given below:
= Profit percentage × amount at year end × purchase percentage
= (($75,000 - $55,000) ÷ $75,000) × 15,000 × 40%
= $1,600
hence, the amount of unrealized intra-entity inventory profit is $1,600
The following events apply to Montgomery Company for Year 1, its first year of operation: Received cash of $49,000 from the issue of common stock. Performed $68,000 of services on account. Incurred $10,500 of other operating expenses on account. Paid $41,000 cash for salaries expense. Collected $44,500 of accounts receivable. Paid a $5,000 dividend to the stockholders. Performed $11,500 of services for cash. Paid $7,500 of the accounts payable. Required a. Record the preceding transactions in general journal form. b. Post the entries to T-accounts and determine the ending balance in each account. c.
Answer:
Montgomery Company
a. Journal Entries
Account Title Debit Credit
Cash $49,000
Common stock $49,000
To record the issue of common stock for cash.
Accounts Receivable $68,000
Service Revenue $68,000
To record the performance of services on account.
Operating Expense $10,500
Accounts payable $10,500
To record operating expenses incurred on account.
Salaries Expense $41,000
Cash $41,000
To record the payment for salaries expense.
Cash $44,500
Accounts Receivable $44,500
To record cash collected on account.
Dividends $5,000
Cash $5,000
To record the payment of dividend to stockholders.
Cash $11,500
Service Revenue $11,500
To record the performance of services for cash.
Accounts payable $7,500
Cash $7,500
To record the payment on account.
b. T-accounts
Cash Account
Account Title Debit Credit
Common stock $49,000
Salaries expense $41,000
Accounts receivable 44,500
Dividends 5,000
Service revenue 11,500
Accounts payable 7,500
Balance 51,500
Totals $105,000 $105,000
Common Stock
Account Title Debit Credit
Cash $49,000
Accounts Receivable
Account Title Debit Credit
Service Revenue $68,000
Cash $44,500
Balance 23,500
Totals 68,000 68,000
Service Revenue
Account Title Debit Credit
Accounts receivable $68,000
Cash 11,500
Balance $79,500
Totals 79,500 79,500
Accounts Payable
Account Title Debit Credit
Operating Expense $10,500
Cash $7,500
Balance 3,000
Totals $10,500 $10,500
Operating Expense
Account Title Debit Credit
Accounts payable $10,500
Salaries Expense
Account Title Debit Credit
Cash $41,000
Dividends
Account Title Debit Credit
Cash $5,000
c. Trial Balance as of December 31, Year 1:
Account Title Debit Credit
Cash $51,500
Common stock $49,000
Accounts receivable 23,500
Service revenue 79,500
Accounts payable 3,000
Operating expense 10,500
Salaries expense 41,000
Dividends 5,000
Totals $131,500 $131,500
Explanation:
a) Transactions:
Received cash of $49,000 from the issue of common stock.
Performed $68,000 of services on account.
Incurred $10,500 of other operating expenses on account.
Paid $41,000 cash for salaries expense.
Collected $44,500 of accounts receivable.
Paid a $5,000 dividend to the stockholders.
Performed $11,500 of services for cash.
Paid $7,500 of the accounts payable.
b) Journal entries record the transactions for the first time. General ledger accounts are where the accounts are summarized. Trial balance shows the list of the account balances extracted from the general ledger.
You are the marketing officer for either a large hotel or a car dealer. Produce a report for
your company's head of marketing in which you explore:
the differences between customer satisfaction and customer delight
ii. the reasons why it is so important to create the sensation of delight among your
customers
iii. the ways in which it could be done.
i.
Illustrate your arguments by examples relevant to your chosen organization, Let the hotel
or car dealership.
Assume the following relationships for the Caulder Corp.: Sales/Total assets 1.7× Return on assets (ROA) 5.0% Return on equity (ROE) 13.0% Calculate Caulder's profit margin and debt-to-capital ratio assuming the firm uses only debt and common equity, so total assets equal total invested capital. Do not round intermediate calculations. Round your answers to two decimal places. Profit margin: % Debt-to-capital ratio: %
Answer:
Profit margin=3%
Debt-to-capital ratio: = 3.8%
Explanation:
Calculations for Profit margin % and Debt-to-capital ratio: %
Calculation for profit margin
Profit margin =.05/1.7
profit margin=0.03*100
profit margin=3%
Calculation for Debt-to-capital ratio using this formula
Debt-to-capital ratio= ROA * (1 / ROE)
Let plug in the formula
Debt-to-capital ratio = .05 * (1 / .013)
Debt-to-capital ratio = .05 *76.92
Debt-to-capital ratio= 3.8%
Therefore: Profit margin=3%
Debt-to-capital ratio = 3.8%
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 $400,000
Work-in-Process Inventory, Beginning 35,000
Work-in-Process Inventory, Ending 46,000
Selling and Administrative Expense 59,000
Finished Goods Inventory, Ending 18,000
Direct Materials Purchased $194,900
Factory Overhead Applied $125,600
Operating Income $25,000
Direct Materials Inventory, Ending $6,800
Cost of Goods Manufactured $380,900
Direct Labor $62,700
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 available for use?
Answer:
$210,400
Explanation:
Particulars Amount
Cost of Goods Manufactured $380,900
Add: Closing WIP $46,000
Less: Opening WIP -$35,000
Less: Factory Overhead Applied -$125,600
Less: Direct Labor -$62,700
Add: Closing stock of Direct material $6,800
Direct Material Available for use $210,400
Item4 eBookPrintReferencesCheck my workCheck My Work button is now disabledItem 4 Lanson Corporation Co.'s trial balance included the following account balances at December 31, 2021: Accounts payable $25,200 Bonds payable, due 2030 24,600 Salaries payable 16,400 Notes payable, due 2022 21,100 Notes payable, due 2026 40,300 What amount should be included in the current liabilities section of Lanson's December 31, 2021, balance sheet
Answer:
$41,600
Explanation:
Calculation for What amount should be included in the current liabilities section of Lanson's December 31, 2021, balance sheet
Accounts payable $25,200
Add Salaries payable $16,400
December 31, 2021, balance sheet current liabilities $41,600
($25,200+$16,400)
Therefore the amount that should be included in the current liabilities section of Lanson's December 31, 2021, balance sheet will be $41,600
Why are supply curves typically upward-sloping? They slope upward because sellers prefer to sell more when prices are lower. They slope upward due to the law of demand. They slope upward because sellers demand more when prices are lower. They slope upward because higher prices lead individual businesses to supply a larger quantity and more businesses are willing to supply goods and services.
Answer: They slope upward because higher prices lead individual businesses to supply a larger quantity and more businesses are willing to supply goods and services.
Explanation:
The supply curve is typically upward-sloping because higher prices lead individual businesses to supply a larger quantity and more businesses are willing to supply goods and services.
What is supply?Supply refers to the amount of a given product or service that suppliers are willing and able to bring to the market for a specific price. The notion of supply is closely related to demand. As, when supply increases the price also goes up because companies want to expand their production to meet the increasing demand.
What is a supply curve?A supply curve represents the relationship between price of a product and quantity of product which a seller is willing and able to supply at a given period of time.
Supply curve are an essential tool for understanding the law of supply. As a supply curve, in a graphical form shows that, if prices of a good or service increases, producers will also increase the quantity they supply.
Why is supply curve upward-sloping?The supply curve slopes upward because if the price of goods and service increases quantity supplied also increases. This happens because of higher prices, which offers higher profits. Thus, it encourages the producer to invest more by producing larger quantities and thus earning larger profits.
Hence, option D is correct.
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