Answer:
the correct inventory amount is $284,400
Explanation:
The computation of the correct inventory amount is shown below:
= End year balance + FOB shipping point + fob destination - fob destination
= $247,680 + $25,880 + $54,220 - $43,380
= $284,400
Hence, the correct inventory amount is $284,400
The Bureau of Labor Statistics reported the consumer price index as 229.6 in December 2012, and 246.5 in December 2017. By what percentage did the index increase from the end of 2012 to the end of 2017 (rounded to one decimal place)
Answer:7.4%
Explanation: In December 2017, the CPI stood at 246.5 up from 229.6 in December 2012. This is a 7.4% increase [(246.5-229.6) /229.6] *100=7.4
Income Statement Project
2018 2019 2020
Revenue:
Book Sales
Ticket Sales
Total Revenue:
Expenses:
Salary
Depreciation
Supplies
Rent Insurance
Total Expense:
Net Income/Loss:
Directions: Build an income statement using the steps provided below.
1) The book store received $50,000 in book sales for 2018, with a 20% increase in revenue each year.
2) Jack's book store received $15,000 each year in ticket sales to book signing events.
3) Find the Total Revenue each year for 2018-2020 using cell referencing.
4) Jack's book store paid $16,000 in employee salaries in 2018. Each year his employee salary cost increased by 25%.
*5) Jack purchased store furniture for $25,000 that is expected to be used over the next 5 years.
6) Jack bought $3,000 in supplies in 2018 and supplies costing $1,000 were used up each year.
'7) Jack signed a contract to pay $800/month for rent between 2018-2020.
8) Jack's book store pays $500 each month to cover insurance.
9) Find the Total Expense each year for 2018-2020 using the SUM function.
10) Find the Net Income/Loss using cell referencing.
Answer:
Jack's Bookstore
Income Statement Projection:
2018 2019 2020
Revenue:
Book Sales $50,000 $60,000 $72,000
Ticket Sales 15,000 15,000 15,000
Total Revenue: $65,000 $75,000 $87,000
Expenses:
Salary $16,000 $20,000 $25,000
Depreciation 5,000 5,000 5,000
Supplies 1,000 1,000 1,000
Rent 9,600 9,600 9,600
Insurance 6,000 6,000 6,000
Total Expense: $37,600 $41,600 $46,600
Net Income/Loss: $27,400 $33,400 $40,400
Explanation:
a) Data and Calculations:
Book Sales for 2019 = $60,000 ($50,000 * 1.20)
Book Sales for 2020 = $72,000 ($60,000 * 1.20)
Salaries for 2019 = $20,000 ($16,000 * 1.25)
Salaries for 2020 = $25,000 ($20,000 * 1.25)
Depreciation expense per year = $5,000 ($25,000/5) using the straight-line method
Supplies Expense per year = $1,000 ($3,000/3)
Rent Expense per year = $9,600 ($800 * 12)
Insurance Expense per year = $6,000 ($500 * 12)
Hazel sells books online for $10.95 each. All of her 630 customers came from her FB friends. How much did she make through FB sales?
Answer:
she has to sell it $6300 that is it price
$6300 is the amount she makes through FB sale, as Hazel sells books online for $10.95 each. All of her 630 customers came from her FB friends.
What is customers?An individual or business that purchases goods or services from another company is known as a customer. Consumers are crucial to businesses because they generate income; without them, they would cease to exist.
A client is a company that buys textiles to produce garments that will be sold again. To assemble an automobile, a manufacturing company buys components. The manufacturing business is a client.
The Undaunted Striver, Impulsive Spender, Balanced Optimist, Ambitious Struggler, Conservative Homebody, Independent Skeptic, and Safe Traditionalist are seven worldwide consumer types that Euromonitor's survey team created using the survey data.
An individual or business that purchases goods or services from another company is known as a customer. Consumers are crucial to businesses because they generate income; without them, they would cease to exist.
Thus, $6300 is the amount.
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Below are the transactions for Ute Sewing Shop for March, the first month of operations.
March 1 Issue common stock in exchange for cash of $1,400.
March 3 Purchase sewing equipment by signing a note with the local bank, $1,100.
March 5 Pay rent of $440 for March.
March 7 Martha, a customer, places an order for alterations to several dresses. Ute estimates that the alterations will cost Martha $640. Martha is not required to pay for the alterations until the work is complete.
March 12 Purchase sewing supplies for $114 on account. This material will be used to provide services to customers.
March 15 Ute delivers altered dresses to Martha and receives $640.
March 19 Ute agrees to alter 10 business suits for Bob, who has lost a significant amount of weight recently. Ute receives $540 from Bob and promises the suits to be completed by March 25.
March 25 Ute delivers 10 altered business suits to Bob.
March 30 Pay utilities of $79 for the current period.
March 31 Pay dividends of $70 to stockholders.
1. Record each transaction.
2. Post each transaction to the appropriate T-accounts.
3. Calculate the balance of each account at March 31.
4. Prepare a trial balance as of March 31.
Ute uses the following accounts:
Cash, Supplies, Equipment, Accounts Payable, Deferred Revenue, Notes Payable, Common Stock, Dividends, Service Revenue, Rent Expense, and Utilities Expense.
Answer:
Part 1
March 1
Debit : Cash $1,400
Credit : Common Stock $1,400
March 3
Debit : Equipment $1,100
Credit : Note Payable $1,100
March 5
Debit : Rent Expense $440
Credit : Cash $440
March 7
No Entry
March 12
Debit : Supplies $114
Credit : Accounts Payable $114
March 15
Debit : Cash $640
Credit : Service Revenue $640
March 19
Debit : Cash $540
Credit : Deferred Revenue $540
March 25
Debit : Deferred Revenue $540
Credit : Service Revenue $540
March 30
Debit : Utilities Expense $79
Credit : Cash $79
March 31
Debit : Dividends $70
Credit : Cash $70
Part 2 and Part 3
Cash : Debit = $1,400 + $640 + $540 Credit = $440 + $79 + $70, Balance = 1,991 Debit
Common Stock : Debit = Credit = $1,400 , Balance = 1,400 Credit
Equipment : Debit = $1,100 Credit = , Balance = 1,110 Debit
Note Payable : Debit = Credit = $1,100 , Balance = 1,100 Credit
Rent Expense : Debit = $440 Credit = , Balance = $440 Debit
Supplies : Debit = $114 Credit = , Balance = $144 Debit
Accounts Payable : Debit = Credit = $114 , Balance = $114 Credit
Service Revenue : Debit = Credit = $640 + $540 , Balance = $1,180 Credit
Deferred Revenue : Debit = $540 Credit = $540 , Balance = $ 0
Utilities Expense : Debit = $79 Credit = , Balance = $79 Debit
Dividends : Debit = $70 Credit = , Balance = $70 Debit
Part 4
Sewing Shop
Trial balance as at March 31
Debit Credit
Cash $ 1,991
Common Stock $1,400
Equipment $1,110
Note Payable $1,100
Rent Expense $440
Supplies $144
Accounts Payable $114
Service Revenue $1,180
Deferred Revenue $ 0 $0
Utilities Expense $79
Dividends $70
Totals $3,864 $3,864
Explanation:
To successfully tackle the question, follow the steps :
Record journal entriesPost the Journals to Ledger Accounts Find the Ledger Account BalancesPrepare a Trial BalanceThe Trial Balance is used to check mathematical accuracy. It is a list of Debit and Credit extracted from Balances from the Ledger Accounts.
define private equity funds.
Answer:
Private equity is composed of funds and investors that directly invest in private companies
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ABC Incorporated has operating income before interest and taxes in 2020 of $199.2 million. The firm is expected to generate this level of operating income indefinitely. The firm had depreciation expense of 10 million that same year. Capital spending totaled 20 million during 2020. At the end of 2019 and 2020, working capital totaled 70 and 80 million, respectively. The firm's combined marginal state, local, and federal tax rate was 30% and its debt outstanding had a market value of 1.2 billion. The 10 year Treasury bond rate is 2% and the borrowing rate for companies exhibiting levels of creditworthiness similar to ABC is 5%. The historical risk premium for stocks over the risk free rate of return is 5.5%. ABC's beta was estimated to be 1.0. The firm has 2,500,000 common shares outstanding at the end of 2020. ABC's target debt to total capital ratio is 30%.
1. The free cash flow to the firm in 2020 (in million).
2. The WACC is (in percentage).
3. The firm value is million.
Answer and Explanation:
The computation is shown below:
1. Free cash flow
= EBIT × (1 - tax rate) + depreciation expense - capital expenditure - change in net working capital
= $199.2 × (1 - 0.30) + $10 - $20 - ($80 - $70)
= $119.44
2. The WACC is
But before that following calculations need to be done
Cost of equity = (2 + 1 × 5.5)
= 7.50%
The cost of debt is 5%
The debt to total capital ratio is 30%
The equity to total capital ratio is (100 - 0.30) = 0.70
Tax rate is 30%
Now
WACC is
= (7.5 × 0.7 + 5 × 0.3 × (1 - 0.3))
= 6.30%
3. The firm value is
= $119.44 ÷ 0.063
= $1,895.87 million
Naumann Corporation produces and sells a single product. Data concerning that product appear below: Per Unit Percent of Sales Selling price $ 200 100 % Variable expenses 36 18 % Contribution margin $ 164 82 % Fixed expenses are $130,000 per month. The company is currently selling 1,200 units per month. Required: Management is considering using a new component that would increase the unit variable cost by $46. Since the new component would improve the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effect on the company's monthly net operating income of this change if fixed expenses are unaffected
Answer:
An increase in net operating income of $127,200
Explanation:
Consider the variable effect of the changes.
Sales ($400 x 400) $160,000
Less Variable expenses ( $82 x 400) ($32,800)
Contribution $127,200
therefore,
An increase in net operating income of $127,200
what the role of marketing
Answer:
The Marketing Department plays a vital role in promoting the business and mission of an organization. It serves as the face of your company, coordinating and producing all materials representing the business.
Explanation:
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During the harsh winter of 1972-73:__________
A. people in the northeast did not have enough oil to heat their homes, but people elsewhere in the U.S. had enough oil to heat their swimming pools.
B. oil was diverted away from low-value uses (like heating swimming pools) to high-value uses (like heating homes in the northeast).
C. there was not enough oil for heating homes in the northeast or for heating swimming pools elsewhere in the U.S.
D. there was enough oil for heating homes in the northeast and for heating swimming pools elsewhere in the U.S.
Answer: A. people in the northeast did not have enough oil to heat their homes, but people elsewhere in the U.S. had enough oil to heat their swimming pools.
Explanation:
1973 saw the beginning of the energy crises after the Arab world placed an oil embargo on the U.S. As a result, gasoline and oil products became very expensive in the U.S. and had to be appropriately used.
The North-East did not suffer as much during this time New York receiving some of the lowest amounts of snow in modern history so less oil went to the north east for heating as it was ruled not to be cold enough.
Keyser Corporation, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $133 Units in beginning inventory 950 Units produced 8,850 Units sold 8,950 Units in ending inventory 850 Variable costs per unit: Direct materials $ 29 Direct labor $ 46 Variable manufacturing overhead $ 10 Variable selling and administrative expense $ 20 Fixed costs: Fixed manufacturing overhead $ 70,800 Fixed selling and administrative expense $164,200 The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month. What is the net operating income for the month under absorption costing
Answer:
$93
Explanation:
Product cost under absorption costing = all manufacturing overheads
= $93
This is the Cost per unit manufactured
Alpaca Corporation had revenues of $200,000 in its first year of operations. They have not collected on $20,000 of their sales, and still owe $25,000 on $70,000 of merchandise they purchased. The company had no inventory on hand at the end of the year. The company paid $15,000 in salaries. Owners invested $20,000 in the business and $20,000 was borrowed on a five-year note. The company paid $2,000 in interest that was the amount owed for the year, and paid $6,000 for a two-year insurance policy on the first day of business. Alpaca has an effective income tax rate of 40%.
Compute the cash balance at the end of the first year for Alpaca Corporation.
Answer:
Closing balance $110000
Explanation:
The computation of the cash balance at the end of the first year is shown below:
Funds raised from owners $20000
Less: Funds borrowed $20,000
Collection from debtors $180,000 ($200,000 - $20,000 )
Less: Payment for merchandise $45000
Salaries paid $15000
Interest paid $2000
Insurance policy paid $6000
Income tax at 40% $42000
Closing balance $110000
Working note:
Calculation of tax paid
Sales 200000
Less: purchases 75000
salary 15000
interest 2000
insurance(50% of 6000) 3000
Income 105000
Tax at 40% 42000
Riverbed Corporation has the following accounts included in its December 31, 2020, trial balance: Accounts Receivable $111,900, Inventory $295,000, Allowance for Doubtful Accounts $9,080, Patents $80,900, Prepaid Insurance $9,790, Accounts Payable $79,100, and Cash $32,000. Prepare the current assets section of the balance sheet. (List Current Assets in order of liquidity.)
Answer:
$439,610
Explanation:
Preparation for the current assets section of the balance sheet
Current assets
Cash $32,000
Accounts Receivable$111,900
Allowance for Doubtful Accounts($9,080)$102,820
($111,900-$9,080)
Inventory $295,000
Prepaid Insurance $9,790
Total current assets $439,610
($32,000+$102,820+$295,000+$9,790)
Therefore the current assets section of the balance sheet is $439,610
In 2020, Simon, age 12, has interest income of $7,500 on funds he inherited from his grandmother, and no earned income. He has no investment expenses. His parents have a taxable income of $82,250 and file a joint return. Assume that no parental election is made. If required, round the tax computations to the nearest dollar.
Simon's net unearned income is $.
Simon's allocable parental tax is $.
Simon's total tax is $.
Answer:
Simon's net unearned income is $5,300. Simon's allocable parental tax is $1,166. Simon's total tax is $1,276.Explanation:
Simon net unearned income = Earned income - Standard deduction - Statutory deduction
= 7,500 - 1,100 - 1,100
= $5,300
Parents filling together with a gross income of $82,250 will fall under the 22% tax bracket.
Simon allocable parental tax = 5,300 * 22%
= $1,166
At kiddie tax rates, maximum unearned income to be taxed is $2,200.
Simon falls under 10% range in 2020.
Tax = (2,200 - $1,100 deduction) * 10%
= $110
Simon total tax = Allocable parental tax + tax on unearned income
= 1,166 + 110
= $1,276
When crafting a business message with strong reasoning, it is important to back claims with Multiple choice question. broad generalizations. your own beliefs.. supporting facts. colorful diagrams.
Answer:
supporting facts
Explanation:
A business message with strong reasoning has as main objectives to convince a consumer to close a deal or an employee to perform certain tasks for example, the objective is always to support an idea and positively impact and convince the public of something.
Therefore, the most suitable option for a business message with strong reasoning is to use supporting facts, as the recipient of the message will feel much more transparency and security when believing in your message if it is supported by concrete facts that support it, and this can be a strong argument to strengthen and reaffirm your idea so that it is more convincing and supported.
Whitewater Wine Foundation expects 125,000 attendees at their May festival. Wine-tasters pay a $10 entrance fee which includes a tasting glass and wine-tasting wristband. Designated drivers pay a $5 entrance fee and receive a ticket for one non-alcoholic drink. Of the attendees, 10% are expected to be designated drivers. Costs to the festival are $.25 for wristbands, $.90 for tasting glasses and $.15 for non-alcoholic drinks. All drink tickets are expected to be used. What is the total purchases budget for the May festival
Answer:
Total purchase budget= $134,375
Explanation:
First, we need to calculate the number of wristbands, tasting glasses, and non-alcoholic drinks glasses.
Wristbands= one per attendant= 125,000
Tasting glasses= 125,000*0.90= 112,500
Non-alcoholic drinks glasses= 125,000*0.10= 12,500
Now, the total purchase budget:
Purchases:
Wristbands= 125,000*0.25= 31,250
Tasting glasses= 112,500*0.9= 101,250
Non-alcoholic drinks glasses= 12,500*0.15= 1,875
Total purchase budget= $134,375
A company called Brightline has made a deal with Disney to create a rail station at Disney Springs on its planned route from Miami to Tampa. Read about this. Is a private rail link a good idea? Will it make Amtrak function any better? Will it create openings for private sector rail owner/operators as was the case in the USA before Amtrak and as is the case in the UK where not all rail services are BritRail?
Answer:
The answer for all three questions is yes.
A private player will increase competition and will make Amtrak provide a better service. Private companies are generally more efficient since their focus is on creating value.
Amtrak might benefit since the private rail might be used as additional help when their service is overloaded.
Increased competition and increase in private investment is always better for everyone since it creates new opportunities.
Peggy is an executive for the Tan Furniture Manufacturing Company. She purchased furniture from the company for $9,500, the price Tan ordinarily would charge a wholesaler for the same items. The retail price of the furniture was $12,500, and Tan's cost was $9,000. The company also paid for Peggy's parking space in a garage near the office. The parking fee was $600 for the year. All employees are allowed to buy furniture at a discounted price comparable to that charged to Peggy. However, the company does not pay other employees' parking fees. Peggy's gross income from the above is:
Answer:
Tan Furniture Manufacturing Company
Peggy's gross income from the above is:
= $3,000.
Explanation:
a) Data and Calculations:
Retail price of the furniture = $12,500
Discounted price for employees = $9,500
Gross income received by Peggy = $3,000 ($12,500 - $9,500)
b) The gross income represents the total amount of benefit derived by Peggy by purchasing the furniture from Tan Furniture Manufacturing Company instead of from another manufacturer.
Ebay, Inc. went public in September of 1998. The following information on shares outstanding was listed in the final prospectus filed with the SEC. In the IPO, the Ebay issued 3,500,000 new shares. The initial price to the public was $18.00 per share. The final first-day closing price was $44.88. If the investment bankers retained $1.26 per share as fees, what was the net proceeds to Ebay in dollars
Answer:
Net proceeds to Ebay = $ 58,590,000.
Explanation:
An Initial Public Offering(IPO) refers to the sales of new block of shares to the general public by a company for the purpose of raising equity capital.
This exercise is always promoted by a third-party company referred to as an underwriter for a fee. The underwriter adds value to the capital raising share offering by contracting to buy up unsold share units should they be undersubscribed. The underwriting fee is a cost to the issuing company.
The net share capital due to the company is computed as follows
Gross share proceeds - underwriting fee
= (3,500,000 × $18.00) - (3,500,000× $1.26)
=$ 58,590,000.
Net proceeds to Ebay = $ 58,590,000.
The closing price of $44.88 is a distracter and should be ignored.
The management of Lanzilotta Corporation is considering a project that would require an investment of $263,000 and would last for 8 years. The annual net operating income from the project would be $99,000, which includes depreciation of $31,000. The scrap value of the project's assets at the end of the project would be $15,000. The cash inflows occur evenly throughout the year. The payback period of the project is closest
Answer: 2 years
Explanation:
Firstly, we need to calculate the annual cash inflow which will be:
= Net Operating Income + Depreciation
= $99,000 + 31,000
= $130,000
Payback period = Initial Investment / Annual cash inflow
= $263,000 / 130,000
= 2.02Years
= 2 years approximately
The payback period is 2 years.
During Compute the number of equivalent units with respect to both materials and conversion respectively for March using the weighted-average method. Multiple Choice, the production department of a process operations system completed and transferred to finished goods 20,000 units that were in process at the beginning of March and 100,000 units that were started and completed in March. March's beginning inventory units were 100% complete with respect to materials and 54% complete with respect to conversion. At the end of March, 29,000 additional units were in process in the production department and were 100% complete with respect to materials and 29% complete with respect to conversion. Compute the number of equivalent units with respect to both materials and conversion respectively for March using the weighted-average method.
Answer:
Computing the equivalent units using the weighted-average method:
Materials Conversion
Total equivalent units 129,000 108,410
Explanation:
a) Data and Calculations:
Beginning inventory = 20,000 units
Degree of completion (Materials 100%, Conversion 54%)
Units started and completed in March = 100,000
Units transferred out = 120,000
Ending inventory = 29,000 units
Degree of completion (Materials 100%, Conversion 29%)
Total equivalent units Materials Conversion
Units started & completed 100,000 (100%) 100,000 (100%)
Units in Ending Inventory 29,000 (100%) 8,410 (29%)
Total equivalent units 129,000 108,410
b) In computing the equivalent units of production, the weighted-average method takes into account the units started and completed within the period and the ending work in process. This is unlike the FIFO method, which considers the units completed in the beginning work-in-process during the current period, the units started and completed, and the ending work-in-process inventory based on their various degrees of completion.
World trade benefits from free and fair trade among nations. Nevertheless, governments of many countries continue to practice protectionism. While protectionism earns profits for domestic producers and tariff revenues for governments, consumers pay higher prices because of protective restrictions. Imposing tariffs increases the price of goods to consumers. Removing tariffs decreases the price of goods to consumers. Imposing quotas limits supply and therefore increases the price of goods to consumers. Removing quotas makes products more available and therefore decreases the price of goods to consumers.
Answer:
Economic effects of imposing a tariff is that it will increase the prices for the goods and consumers will have to pay more for certain good.
Explanation:
Many countries promote trade without tariff so that they can benefit the consumers of their country, but this is only possible if both countries have good relations. Many countries are governed by World trade organizations in order to govern the trade policies. The countries can flourish their trade if they have minimum tariffs and trade policies. Imposition of higher tariff will create burden on consumers of a country.
economics is the study of a society's financial institutions. true or false
Answer:
False
Explanation:
Economics is the study of a society's financial institutions. This statement is False.
What is Economics?Economics is a social science that examines how products and services are produced, distributed, and consumed as well as the decisions that people, corporations, governments, and nations make when allocating resources.
While macroeconomics focuses on the behavior of the economy as a whole on an aggregate level, microeconomics focuses on the decisions made by individuals and enterprises.
Hesiod, a Greek farmer, and poet who lived in the eighth century B.C. is one of the oldest economists known to have written about the necessity for efficient allocation of labor, resources, and time to combat scarcity. The first modern Western economic ideas emerged with the publication of Adam Smith's book An Inquiry Into the Nature and Causes of the Wealth of Nations in 1776.
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XYZ Corporation is contemplating the replacement of an existing asset used in the operation of its business. The original cost of this asset was $28,000; since date of acquisition, the company has taken a total of $20,000 of depreciation expense on this asset. The current disposal (market) value of this asset is estimated as $18,000. XYZ is subject to a combined income tax rate, t, of 34%. What is the projected after-tax cash flow associated with the sale of the existing asset, rounded to nearest hundred dollars
Answer:
The projected after-tax cash flow associated with the sale of the existing asset is $14,600.
Explanation:
The projected after-tax cash flow can be calculated as follows:
Net book value of the asset = Original cost - Accumulated depreciation expense = $28,000 - $20,000 = $8,000
Capital gains = Estimated current disposal (market) value of the asset - Net book value of the asset = $18,000 - $8,000 = $10,000
Capital gains tax = Capital gains * Tax rate = $10,000 * 34% = $3,400
Projected after-tax cash flow = Estimated current disposal (market) value of the asset - Capital gains tax = $18,000 - $3,400 = $14,600
Therefore, the projected after-tax cash flow associated with the sale of the existing asset is $14,600.
define private equity funds.
Answer:
keeping it private and not letting anyone find. out about it or keepin it from people
On January 1, 20X7, Poke Corporation acquired 25 percent of the outstanding shares of Shove Corporation for $100,000 cash. Shove Company reported net income of $75,000 and paid dividends of $30,000 for both 20X7 and 20X8. The fair value of shares held by Poke was $110,000 and $105,000 on December 31, 20X7 and 20X8 respectively. Based on the preceding information, what amount will be reported by Poke as income from its investment in Shove for 20X8, if it used the equity method of accounting
Answer:
$18,750
Explanation:
Income from investment = 25% * $75,000
Income from investment = 0.25 * $75,000
Income from investment = $18,750
The amount that will be reported by Poke as income from its investment in Shove for 20X8, if it used the equity method of accounting is $18,750
Carlin and Marley, an accounting firm, provides consulting and tax planning services. For many years, the firm's total administrative cost (currently $270,000) has been allocated to services on this basis of billable hours to clients. A recent analysis found that 55% of the firm's billable hours to clients resulted from tax planning services, while 45% resulted from consulting services. The firm, contemplating a change to activity-based costing, has identified three components of administrative cost, as follows: Staff Support$200,000 In-house computing charges 50,000 Miscellaneous office costs 20,000 Total$270,000 A recent analysis of staff support found a strong correlation with the number of clients served. In contrast, in-house computing and miscellaneous office cost varied directly with the number of computer hours logged and number of client transactions, respectively. Consulting clients served totaled 35% of the total client base, consumed 30% of the firm's computer hours, and accounted for 20% of the total client transactions. If Carlin and Marley switched from its current accounting method to an activity-based costing system, the amount of administrative cost chargeable to consulting services would:
Answer:
Carlin and Marley
Using activity-based costing system, the amount of administrative cost chargeable to consulting services would be:
= $89,000
instead of $121,500 using the traditional method.
Explanation:
a) Data and Calculations:
Services provided by the accounting firm = consulting and tax planning
Total administrative cost = $270,000
Traditional allocation basis = billable hours to clients
Services Tax Planning Consulting Total
Traditional cost pool basis:
Billable hours to clients 55% 45% 100%
Activity cost pool bases:
Client base 65% 35% 100%
Computer hours 70% 30% 100%
Total client transactions 80% 20% 100%
Activity Pools Overhead Costs Activity Basis
Staff Support $200,000 Number of clients served
In-house computing charges 50,000 Number of computer hours
Miscellaneous office costs 20,000 Number of client transactions
Total administrative cost = $270,000
Overhead Allocation for each Activity Cost Pool:
Services Total Tax Planning Consulting
Staff Support $200,000 $130,000 $70,000
In-house computing charges 50,000 35,000 15,000
Miscellaneous office costs 20,000 16,000 4,000
Total administrative cost = $270,000 $181,000 $89,000
Traditional costing method:
Billable hours to clients 100% 55% 45%
Amount based on billable hours $270,000 $148,500 $121,500
Which research information could best help a marketer decide whether to
discontinue a product line?
A. Results of an experiment showing the combination of price and
features that consumers most often select
B. Observation results showing the path consumers take through a
store
C. Survey results indicating that the product no longer meets a
customer need
D. Survey results showing that what consumers value most is
reliability
Answer: survey results indicating that the product no longer meets a customer need
Explanation:
The research information that could best help a marketer decide whether to discontinue a product line is: Survey results indicating that the product no longer meets a customer need. Thus option (C) is correct.
What is an information?An information refers to something that has the power to inform. At the most fundamental level information pertains to the interpretation of that which may be sensed.
The digital signals and other data use discrete signs or alogrithms to convey information, other phenomena and artifacts such as analog signals, poems, pictures, music or other sounds, and the electrical currents convey information in a more continuous form.
Information is not knowledge itself, but its interpretation is important. An Information can be in a raw form or in an structured form as data. The information available through a collection of data may be derived by analysis by expert analysts in their domain.
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Stallion Corporation sold $190,000 par value, 10-year first mortgage bonds to Pony Corporation on January 1, 20X5. The bonds, which bear a nominal interest rate of 10 percent, pay interest semiannually on January 1 and July 1. The entry to record interest income by Pony Corporation on December 31, 20X7, was as follows:
Note: Assume using straight-line amortization of bond discount or premium.
General Journal Debit Credit
Interest Receivable 9,500
Interest Income 9,025
Investment in Stallion Corporation Bonds 475
Pony Corporation owns 65 percent of the voting stock of Stallion Corporation, and consolidated statements are prepared on December 31, 20X7.
Required:
A. What was the original purchase price of the bonds to Stallion Corporation?
B. What is the balance in Pony's bond investment account on December 31, 20X7?
C. Prepare the worksheet elimination entry or entries needed to remove the effects of the intercompany ownership of bonds in preparing consolidated financial statements for 20x7.
• Record the entry to eliminate the effects of the intercompany ownership in the bonds.
• Record the entry to eliminate the intercompany interest receivables/payables.
Answer:
a. Amortization of Bond Premium semi-annual = $475
Amortization of Bond Premium annual = $475*2 = $950
Bond Premium = $950*10 years = $9,500
Par value of Bonds $190,000
Premium on Bonds $9,500
Original Price of Bonds $199,500
b. Original Purchase Price = $199,500
Semi-annual periods from Jan 1,20X5 - Dec 31,20X7 = 3 yrs*2 = 6 periods
Premium amortization till Dec 31, 20X7 = $475*6 = $2,850
Balance in Bond Investment account = $199,500 - $2,850
Balance in Bond Investment account = $196,650
c. Event Accounts & Explanation Debit Credit
1. Bonds Payable $190,000
Bond Premium ($9,500 - $2,850) $6,650
Interest Income ($9,025*2) $18,050
Investment in Stallion Corporation Bonds $196,650
Interest Expense $18,050
(To record the entry to eliminate the effects of the
inter-company ownership in the bonds)
2. Interest Payable $9,500
Interest Receivable $9,500
(To record the entry to eliminate the inter-company
interest receivables/payable)
At 8.5 percent interest, how long does it take to double your money? (do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) length of time 17 years at 8.5 percent interest, how long does it take to quadruple your money?
Answer:
Using the Rule of 72, it would take 8.47 years to double at 8.5% interest.
The rule of 72 is very simple: divide 72 by the fixed interest rate to determine number of years it will take for an investment to double
Explanation:
Mustang Corporation had 100,000 shares of $2 par value common stock outstanding. On December 31, 2018, the company's board of directors declares a 20 percent stock dividend. This stock dividend will be distributed on January 20, 2019 to the stockholders of record on January 15, 2019. The market price of the company's stock is $10 per share on December 31, 2018.
Complete the necessary journal entry to record the declaration of the stock dividend by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns
list Journal entry worksheet
Mustang Corporation had 100,000 shares of $2 par value common stock outstanding On December 31, 2018, the company's board of directors declares a 20 percent stock dividend. This stock dividend will be distributed on January 20, 2019 to the stockholders of record on January 15, 2019. The market price of the company's stock is $10 per share on December 31, 2018
Note Enter debit before credits
Date General Journal Debit Credit
Dec 31
Record entry Clear entry View General journal
Answer:
1. Dec 31, 2018
Dr Retained Earnings $200,000
Cr Common Stock dividend distributable $40,000
Cr Paid in Capital in Excess of par $160,000
2. Jan 15 , 2019
No Journal Entry is required
3. Jan 20 , 2019
Dr Common Stock dividend distributable $40,000
Cr Common Stock $40,00
Explanation:
Preparation of the necessary journal entry to record the declaration of the stock dividend
1. Dec 31, 2018
Dr Retained Earnings $200,000
(100,000 Shares * 20%* $ 10)
Cr Common Stock dividend distributable $40,000
(100,000 Shares * 20%* $2)
Cr Paid in Capital in Excess of par $160,000
($ 200,000 - $ 40,000 )
2. Jan 15 , 2019
No Journal Entry is required
3. Jan 20 , 2019
Dr Common Stock dividend distributable $40,000
Cr Common Stock $40,000
(100,000 Shares * 20%* $2)