Answer:
North Star
Adjusting Journal Entries:
December 31:
Rent Expense $1,280
Prepaid Rent $1,280
To accrue rent for the period.
Depreciation Expense $1,080
Accumulated Depreciation $1,080
To accrue Depreciation charge for the year.
Utilities Expense $9,800
Utilities Payable $9,800
To accrue unpaid utilities.
Income Tax Expense $470
Income Tax Payable $470
To accrue income tax liability.
Explanation:
Adjusting entries are journal entries that are made at the end of an accounting period to ensure that all expenses and incomes pertaining to the period are recognized in accordance with the accrual concept and the matching principle. These accounting concepts require that all expenses incurred whether paid for or not and income whether received or not, which relate to the period, are matched respectively.
Is it reasonable to expect that managers can measure their social and environmental performance on the same level as they measure their financial performance with a triple bottom line?
Answer:
The correct answer is: No, it is not reasonable to expect that managers can measure their social and environmental performance on the same level as they measure their financial performance.
Explanation:
To begin with, the concept known as triple bottom line refers exactly to the measuring of the the financial, social and environemental performances from part of an organization. However, it is not posible to measure them in the same way, due to the fact that they are very different terms with different factors. Therefore that in order to measure one of them there will be an unique way of doing it that can not be copy in order to measure the other. That is why if the organization want to measure the financial performance it will look into the numbers but with the social or environmental performance it can not do that.
On October 10, a company paid $36,000 to a supplier. Of that amount, $6,000 was for supplies received on October 10 and $30,000 was for supplies that were purchased on account during September. The journal entry to record the $36,000 payment would include a debit to:
Answer:
Debit to :
Supplies Inventory $6,000
Trade Payable $30,000
Explanation:
Here the $6,000 payment will increase the Assets of Supplies Inventories and decrease the Assets of Cash. The $30,000 payment will decrease the Liability - Trade Payable and decrease the Assets of Cash.
The Journal is provided as follows :
Supplies Inventory $6,000 (debit)
Trade Payable $30,000 (debit)
Cash $36,000 (credit)
On March 1, Sather Co. sold merchandise to Boone Co. on account, $28,400, terms 2/15, n/30. The cost of the merchandise sold is $19,500. The merchandise was paid for on March 14. Assume all discounts are taken.Required:Journalize the entries for Sather Co. and Boone Co. for the sale, purchase, and payment of amount due. Refer to the appropriate company’s Chart of Accounts for exact wording of account titles.CHART OF ACCOUNTSSummit Co.General LedgerASSETS110 Cash121 Accounts Receivable-Beartooth Co.125 Notes Receivable130 Merchandise Inventory131 Estimated Returns Inventory140 Office Supplies141 Store Supplies142 Prepaid Insurance180 Land192 Store Equipment193 Accumulated Depreciation-Store Equipment194 Office Equipment195 Accumulated Depreciation-Office EquipmentLIABILITIES210 Accounts Payable216 Salaries Payable218 Sales Tax Payable219 Customers Refunds Payable221 Notes PayableEQUITY310 Owner, Capital311 Owner, Drawing312 Income Summary REVENUE410 Sales610 Interest RevenueEXPENSES510 Cost of Merchandise Sold521 Delivery Expense522 Advertising Expense524 Depreciation Expense-Store Equipment525 Depreciation Expense-Office Equipment526 Salaries Expense531 Rent Expense533 Insurance Expense534 Store Supplies Expense535 Office Supplies Expense536 Credit Card Expense539 Miscellaneous Expense710 Interest ExpenseCHART OF ACCOUNTSBeartooth Co.General LedgerASSETS110 Cash120 Accounts Receivable125 Notes Receivable130 Merchandise Inventory131 Estimated Returns Inventory140 Office Supplies141 Store Supplies142 Prepaid Insurance180 Land192 Store Equipment193 Accumulated Depreciation-Store Equipment194 Office Equipment195 Accumulated Depreciation-Office EquipmentLIABILITIES211 Accounts Payable-Summit Co.216 Salaries Payable218 Sales Tax Payable219 Customers Refunds Payable221 Notes PayableEQUITY310 Owner, Capital311 Owner, Drawing312 Income Summary REVENUE410 Sales610 Interest RevenueEXPENSES510 Cost of Merchandise Sold521 Delivery Expense522 Advertising Expense524 Depreciation Expense-Store Equipment525 Depreciation Expense-Office Equipment526 Salaries Expense531 Rent Expense533 Insurance Expense534 Store Supplies Expense535 Office Supplies Expense536 Credit Card Expense539 Miscellaneous Expense710 Interest Expense
Answer and Explanation:
The journal entries are shown below:
On the books of Sather Co.
On Mar 1
Accounts Receivable $28,400
To Sales $28,400
(Being the merchandise sold on credit is recorded)
For recording this we debited the account receivable as it increased the assets and credited the sales as it also increased the sales
Cost of goods sold $19,500
To Merchandise inventory $19,500
(Being the cost of merchandise is recorded)
For recording this we debited the cost of goods sold as it increased the expenses and credited the inventory as it reduced the assets
On Mar 14
Cash $27,830
Sales Discounts ($28,400 × 2%) $568
To Accounts Receivable $28,400
(Being the payment received is recorded)
For recording this we debited the sales and discount as it increased the assets and discount and credited the account receivable as it decreased the assets
On the books of Boone Co.
On Mar 1
Merchandise Inventory $28,400
To Accounts Payable $28,400
(Being the merchandise is purchased on credit)
For recording this we debited the inventory as it increased the assets and credited the account payable as it also increased the liabilities
On Mar 14
Accounts Payable $28,400
To Cash $27,830
To Merchandise inventory ($28,400 × 2%) $568
(Being the cash payment is recorded)
Fo recording this we debited the account payable as it reduced the liabilities and credited the cash and inventory as it also decreased the assets
Kelly received a $60,000 salary during 2017. Her federal income tax withholding rate was 20%, and the Social Security base amount for 2017 was $118,500.What is the total amount that her employer should have withheld in 2017?
A. $15,390
B. $16,590
C. $15,979
D. $6,849
Answer: B. $16,590
Explanation:
The FICA tax rate which is the combined Social Security and Medicare rate for 2017 was 7.65%.
Assuming a base of $118,500 this means that you are taxed on your first $118,500 in earnings.
Kelly only made $60,000 so the tax rate will apply to her $60,000.
Adding that to the 20% that she is due to pay on Federal Income tax the total amount her employer withheld was,
= (60,000 * 20%) + (60,000 * 7.65%)
= 12,000 + 4,590
= $16,590
Option B is correct.
Sauber's washer-dryer is available in four stylish finishes: stainless steel, pearl white, gunite gray, and obsidian. Although the cycle time is 20% longer than average, the machine runs quietly and offers 10 wash, 5 spin, and 8 dry options. A programmable timer allows users to program a wash up to 23 hours in advance. The manufacturer's suggested retail price is $1499, which is more expensive than U.S. brands' washer-dryer combinations, which average around $1000. Choose the two variables that would be most predictive of purchase intent for the All-in-One washer-dryer.
a. household size: how many people?
b. dwelling type: apartment, condo, or house.
c. religious orientation: beliefs and worship.
Answer:
a and b
Explanation:
Religious orientation has nothing to do with how much money to spend or what machine to use
Zeke Company sells 26,900 units at $16 per unit. Variable costs are $9 per unit, and fixed costs are $38,100. The contribution margin ratio and the unit contribution margin, respectively, are
Answer:
Contribution margin ratio= 0.4375
Contribution margin= $7
Explanation:
Giving the following information:
Zeke Company sells 26,900 units at $16 per unit. Variable costs are $9 per unit, and fixed costs are $38,100.
To calculate the contribution margin per unit, we need to use the following formula:
Contribution margin= selling price - unitary variable cost
Contribution margin= 16 - 9= $7
Now, we can calculate the contribution margin ratio:
Contribution margin ratio= contribution margin/ selling price
Contribution margin ratio= 7/16
Contribution margin ratio= 0.4375
A water utility is planning to construct a grease treatment facility so that local haulers will not have to transport grease to a city 550 km away. The facility will cost $400,000 to build and $160,000 per year to operate. Benefits to the haulers and restaurant owners (through reduced costs) are expected to be $250,000 per year. If the facility will have a 10-year life, the B/C ratio at 6% per year is closest to:
Answer:
The B/C ratio at 6% per year is closest to 1.17
Explanation:
In order to calculate the B/C ratio at 6% per year we would have to make first the following calculations:
Present Worth(PW) of annual operating cost (excel formula) =PV(0.06,10,160000,0) = $1,177,613.93
PW of annual benefit (excel formula) =PV(0.06,10,250000,0) = $1,840,021.76
Present cost (at beginning of project) = $400,000
Therefore, to calculate the B/C ratio at 6% we would use the following formula:
B/C ratio at 6%=PW of benefits-PW of disbenefits/Initial cost+PW of operating and maintenance-PW of salvage value
B/C ratio = ($1,840,021.76 - 0)/($400,000 - $1,177,613.93) = 1.17
Toward the end of the selection process, Eleanor is one of two final candidates. She meets with the company's executive vice-president in her third interview, and they spend most of the time discussing Eleanor's experiences working in different corporate cultures. This interview is likely a structured interview.A. TrueB. False
Answer:
The correct answer is the option A: True.
Explanation:
To begin with, the term of "structured interview" refers to the type of interview that is previously planned in order to already had the questions by the time the person comes to the interview, and therefore that it does not implicates to be doing questions at random. Moreover, it is used in order to gain time and to obtain the major amount of information about the person that the interviewer wants. That is why, that in this case is likely an structured interview due to the fact that the employeer already knew what he wanted to know about the person and therefore he is focus on having that information, in this case, previous experience work.
Which of the following reports, which generally are shared only between the organizations that are doing business with one another, are used by auditors to assess the ICFR at one entity that does business with another entity
A. SOC-1
B. SOC-2
C. SOC-3
Answer:
A. SOC-1.
Explanation:
SOC-1 is an acronym for System and Organization Controls Report, which generally are report shared only between the organizations that are doing business with one another. It is also used by auditors to assess, test and report the Internal Control over Financial Reporting (ICFR) at one entity that does business with another entity.
The SOC-1 report is also known as Statement on Standards for Attestation Engagements (SSAE) 18, it helps to create trust and transparency among business entities.
However, it was formerly referred to as the Statement on Auditing Standards 70 (SAS 70) and usually is valid for a period of 1 year (12 months).
In calculating the probability of being alive at certain times in the future, the expert would most likely utilize the National Vital Statistics Report detailing the "number of people alive" out of 100,000 people for various demographic characteristics. True/False
Answer: True
Explanation:
The National Vital Statistics System is an inter-governmental system of sharing of data on vital statistics of the United States population. The National Vital Statistics System consist of the
Vital Statistics of the United States and the National Vital Statistics Report.
If an expert wants to calculate the probability of being alive at certain times in the future, such expert would most likely utilize the National Vital Statistics Report which details the "number of people alive" out of 100,000 people for various demographic characteristics. This is because the reports are accurate and can be easily accessible online.
Suppose that a 1-year zero-coupon bond with face value $100 currently sells at $90.37, while a 2-year zero sells at $77.15. You are considering the purchase of a 2-year-maturity bond making annual coupon payments. The face value of the bond is $100, and the coupon rate is 9% per year. a. What is the yield to maturity of the 2-year zero?(Do not round intermediate calculations. Round your answers to 3 decimal places.)
Answer:
The yield to maturity on the 2 year-zero coupon bond is 13.85% as computed in the explanation section below
Explanation:
The yield to maturity on the 2-year-zero coupon bond can be computed using the rate formula in excel as shown thus:
=rate(nper,pmt,-pv,fv)
nper is the number of annual coupon payments which is 2
pmt is the amount of annual coupon payment which is zero since it is a zero coupon bond
pv is the current price of the bond which is $77.15
fv is the face value of the bond which is $100
=rate(2,0,-77.15,100)=13.85%
17. A global strategy for a company would include a. Products tailored to local tastes and needs, with local sourcing. b. A standardized product available without any local responsiveness. c. Patents and copyrights that are designed to promote maximum innovation. d. All of the above.
Answer: b. A standardized product available without any local responsiveness.
Explanation:
A global strategy refers to when a company aims to expand across the globe. One of the strategies is known as Standardisation.
This is a policy where the company that hopes to expand decides that it wants to make a standard product that is the same the world over. By not making it available without local responsiveness ( differentiating it by adding local features to it), the company signals that they want their product to be the same around the world.
It is very useful to some companies such as Apple which has the iPhone around the world with no local customisation and Dominoes Pizza which aims to have their pizza taste the same the world over.
Geoffrey, Suzanne, Jay, and Emma are college roommates. They're trying to decide where the four of them should go for spring break: Las Vegas or Vail. If they order the tickets by 10:00 PM on February 1, the cost will be just $500 per person. If they miss that deadline, the cost rises to $1,200 per person.
The following table shows the benefit (in dollar terms) that each roommate would get from the two trips.
Roommate Benefit from Las Vegas Benefit from Vail
Geoffrey $600 $1,300
Suzanne $850 $850
Jay $900 $700
Emma $1,100 $650
The roommates tend to put off making decisions. So, when February 1 rolls around and they still haven't made a decision, they schedule a vote for 9:00 PM that night. In case of a tie, they will flip a coin between the two vacation destinations.
The roommates will get the most total benefit if they choose to go to .
Given the individual benefits each roommate receives from the two trips, which trip will each roommate vote for? Fill in the table with each roommate's preferred location, assuming that a given roommate will abstain if he or she has no preference.
Roommate Vote
Emma
Jay
Suzanne
Geoffrey
Under majority rule, the roommates will vote to go to . Therefore, majority rule leads to an economically outcome.
Suppose Emma misses the vote, leaving Geoffrey, Suzanne, and Jay to figure out where they're going to go.
Geoffrey and Jay argue for their preferred destinations, but Suzanne offers to vote with Geoffrey if Geoffrey will vote on her side in an upcoming class election. This is an example of:________.
Answer: Please refer to explanation
Explanation:
1. The roommates will get the most total benefit if they choose to go to ________.
To answer this, you add the total benefit they could all get from going to either Las Vegas or Vail.
Las Vegas
= 600 + 850+ 900 + 1,100
= $3,450
Vail
= 1,300 + 850+ 700 + 650
= $3,500
The room mates in total will get a higher benefit if they choose to go to Vail.
2. Which location will each pick based on their benefits.
Emma gets a higher benefit if they go to Las Vegas so they will pick that.
Jay gets a higher benefit if they go to Las Vegas as well so they will pick that.
Suzanne will abstain as both places give them the same benefit.
Geoffrey gets a higher benefit if they go to Vail so they will pick that.
3. Under majority rule, the roommates will vote to go to ________ .
They will vote to go to Las Vegas because Emma and Jay will vote for it, Suzanne will abstain and Geoffrey will vote for Vail meaning 2 votes out of 3 for Las Vegas.
4. Therefore, majority rule leads to an economically _______ outcome.
Inefficient outcome because in total they will get a smaller benefit going to Las Vegas as opposed to Vail.5. This is an example of:________.
Logrolling
Logrolling is a practice by which people promise to mutually support each other at different times. Simply speaking, one will support the other in exchange for the other supporting the one at some later period in time. This is the deal that Suzanne offer Geoffrey.
Insurance companies facilitate the transfer of risk from Multiple Choice those who have a low-risk tolerance to those with high risk-tolerance. insurance policyholders to the government. those who have a high-risk tolerance to those with low risk-tolerance. the insurance companies' owners to the insurance policyholders.
Answer:
Those who have a low-risk tolerance to those with high risk-tolerance.
Explanation:
In Insurance, risk tolerance refers to the willingness of an individual or organization to take a risk in business transactions in order to get a potentially positive reward.
Simply stated, risk tolerance in insurance is the willingness of an insured individual to increase his or her Self-Insured Retentions (SIRs) or deductibles by the insurer. For instance, the high risk associated with investments such as stocks, high-yield bonds, is often perceived by investors to be worth the higher reward such investment brings.
Insurance companies facilitate the transfer of risk from those who have a low-risk tolerance to those with high risk-tolerance. The transfer of risk in insurance refers to the process whereby an individual or entity pay premiums to an insurer for the purpose of mitigating potential losses or liabilities.
Generally, insurance companies across the globe charge millions of their customers (insured) premiums every year. This gives them the privilege of having a pool of cash which can be used to cover the cost of losses and destruction to the asset of a small fraction or percentage of its customers.
This simply means that, since insurance companies collect premium from all of their customers for losses which may or may not occur, so they can easily use this cash to compensate or indemnify for losses incurred by those having high risk.
Where does Hewitt’s leadership fall on the Managerial Grid discussed in the chapter? (5 marks) (b) What deficiencies or shortcomings would you identify in Hewitt’s leadership
Answer:
The Hewitt's leadership falls on the the Middle of Road Management, which is carefully assessed, realistic and in turn creates a balance between concerns for people and production.
The shortcomings of this leadership are, Failure to motivate and inspire people, lack of passion and enthusiasm, Inability to keep workers.
Explanation:
Solution:
(a) The leadership of Hewitt fall towards the Middle of Road Management at 5,5 points, as it is well realistic, carefully assessed or adjusted, and satisfies the concerns for the people and production.
(b) The shortcomings or defaults discovered in Hewitt's Leadership is stated as follows:
The failure to motivate and inspire peopleThe Inability to retain employees or workersThe lack of passion and willingness or zealThe lack of appreciation on employee or individualSean is a baseball player who earns $890,000 per year playing for team X. If he weren't playing baseball for team X, he would be playing baseball for team Y and earning $660,000 per year. If he weren't playing baseball at all, he would be working as an accountant earning $90,000 per year. What is his economic rent as a baseball player?
Answer: The answer is given below
Explanation:
Economic rent is a payment to a factor of production that is in excess of the costs which are needed to bring the factor into production. It is the payment in excess of the opportunity cost.
Economic rent = Present opportunity - opportunity cost.
Sean is a baseball player who earns $890,000 per year playing for team X. If he weren't playing baseball for team X, he would be playing baseball for team Y and earning $660,000 per year. His economic rent in this case will be:
Economic rent = Present opportunity - opportunity cost.
= $890,000 - $660,000
= $230,000
If he weren't playing baseball at all, he would be working as an accountant earning $90,000 per year. His economic rent in this case will be:
Economic rent = Present opportunity - opportunity cost.
= $890,000 - $90,000
= $800,000
Why would the Lana Limited Corporation decide to issue stocks?
On July 1, 2019, Pat Glenn established Half Moon Realty. Pat completed the following transactions during the month of July.
A. Opened a business bank account with a deposit of $24,000 from personal funds.
B. Purchased office supplies on account, $2,200.
C. Paid creditor on account, $1,250.
D. Earned sales commissions, receiving cash, $42,000.
E. Paid rent on office and equipment for the month, $3,500.
F. Withdrew cash for personal use, $3,200.
G. Paid automobile expenses (including rental charge) for month, $3,200, and miscellaneous expenses, $1,900.
H. Paid office salaries, $4,400.
I. Determined that the cost of supplies on hand was $800; therefore, the cost of supplies used was $1,400.
Required:1. Indicate the effect of each transaction and the balances after each transaction, using the tabular headings in the exhibit below. In each transaction row (rows indicated by a letter), you must indicate the math sign (+ or -) in columns affected by the transaction. You will not need to enter math signs in the balance rows (rows indicated by Bal.). Entries of 0 (zero) are not required and will be cleared if entered.Assets = Liabilities + Owner’s EquityPat Pat Accounts Glenn, Glenn, Sales Salaries Rent Auto Supplies MiscellaneousCash + Supplies = Payable + Capital - Drawing + Commissions - Expense - Expense - Expense - Expense - Expense2. Prepare an income statement for July, a statement of owner’s equity for July, a balance sheet as of July 31. Refer to the list of Accounts on the accounting equation grid and the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. If a net loss has been incurred, enter that amount as a negative number using a minus sign. You will not need to enter colons (:) on the statements.Labels Expenses For the Month Ended July 31, 2016 July 31, 2016 Amount Descriptions Decrease in owner’s equity Increase in owner’s equity Investment on July 1, 2016 Less withdrawals Net income Net income for July Net loss Net loss for July Pat Glenn, capital, July 1, 2016 Pat Glenn, capital, July 31, 2016 Plus withdrawals Total assets Total expenses Total liabilities and owner’s equity 1. Indicate the effect of each transaction and the balances after each transaction, using the tabular headings. In each transaction row (rows indicated by a letter), you must indicate the math sign (+ or -) in columns affected by the transaction. You will not need to enter math signs in the balance rows (rows indicated by Bal.). Entries of 0 (zero) are not required and will be cleared if entered.Assets = Liabilities + Owner’s Equity Pat Pat Accounts Glenn, Glenn, Sales Salaries Rent Auto Supplies Miscellaneous Cash + Supplies = Payable + Capital - Drawing + Commissions - Expense - Expense - Expense - Expense - Expense a. a.b. b.Bal. - - - - - - Bal.c. c.Bal. - - - - - - Bal.d. d.Bal. - - - - - - Bal.e. e.Bal. - - - - - - Bal.f. f.Bal. - - - - - - Bal.g. g.Bal. - - - - - - Bal.h. h.Bal. - - - - - - Bal.i. i.Bal. - - - - - - Bal.2. Prepare an income statement for July 31. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Refer to the list of Accounts on the accounting equation grid and the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading. You will not need to enter colons (:) on the income statement.Half Moon RealtyIncome Statement1234567892. Prepare a statement of owner’s equity for the month ended July 31, 2016. If a net loss has been incurred or there has been a decrease in owner’s equity, enter that amount as a negative number using a minus sign. Refer to the list of Accounts on the accounting equation grid and the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading.Half Moon RealtyStatement of Owner’s Equity12345672. Prepare a balance sheet as of July 31, 2016. Refer to the list of Accounts on the accounting equation grid and the lists of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Be sure to complete the statement heading.Half Moon RealtyBalance Sheet1Assets2345Liabilities67Owner’s equity89
Answer:
Assets = Liabilities + Equity Revenue - Expenses = Net Income
A. + 0 + 0 0 0
B. + + - 0 0 0
C. - - 0 0 0 0
D. + 0 + + 0 +
E. - 0 - 0 - -
F. - 0 - 0 0 0
G. - 0 - 0 - -
H. - 0 - 0 - -
I. - 0 - 0 - -
Half Moon Realty
Income Statement
For the Month Ended on July 31, 2019
Service revenue $42,000
Wages expense ($4,400)
Rent expense ($3,500)
Automobile expense ($3,200)
Supplies expense ($1,400)
Miscellaneous expenses ($1,900)
Net income $27,600
Half Moon Realty
Balance Sheet
For the Month Ended on July 31, 2019
Assets:
Cash $48,550
Office supplies $800
Total assets = $49,350
Liabilities and stockholders' equity:
Accounts payable $950
Pat Glenn, capital $24,000
Pat Glenn, drawings ($3,200)
Retained earnings $27,600
Total liabilities and stockholders' equity: $49,350
Half Moon Realty
Statement of Owner's equity
For the Month Ended on July 31, 2019
Pat Glenn, capital $24,000
Net income $27,600
Subtotal $51,600
Pat Glenn, drawings ($3,200)
Pat Glenn, capital $48,400
Tony Hawk's Adventure (THA) issued callable bonds on January 1, 2021. THA's accountant has projected the following amortization schedule from issuance until maturity: Date Cash Paid Interest Expense Increase in Carrying Value Carrying Value 01/01/2021 $ 379,697 06/30/2021 $ 16,000 $ 18,985 $ 2,985 382,682 12/31/2021 16,000 19,134 3,134 385,816 06/30/2022 16,000 19,291 3,291 389,107 12/31/2022 16,000 19,455 3,455 392,562 06/30/2023 16,000 19,628 3,628 396,190 12/31/2023 16,000 19,810 3,810 400,000 THA buys back the bonds for $384,446 immediately after the interest payment on 12/31/2021 and retires them. What gain or loss, if any, would THA record on this date
Answer:
THA would record a gain of $1,370 on 12/31/2021
Explanation:
Particulars Amount ($)
Carrying value of bonds after the interest payment on 12/31/2021 385,816
Less: Amount paid on redemption on 12/31/2021 (384,446)
Gain on redemption of bonds 1,370
Entry would be-
Date Account titles and Explanation Debit ($) Credit ($)
12/31/2021 Bonds payable 385,816
Cash 384,446
Gain on redemption of bonds 1,370
(To record redemption of bonds)
A food truck operator originally produced hamburgers and hotdogs. To serve the tastes of their various customers, the hot dog vendor decides to start producing turkey dogs and ham sandwiches as well. Since the new products were introduced, average costs rose dramatically. The vendor is experiencing:________.
A. Economies of scope.
B. Diseconomies of scope.
C. Economies of scale.
D. Diseconomies of scale.
The correct answer is B. Diseconomies of scope
Explanation:
In businesses, diseconomies of scope occur when costs increase when two or more products are produced by the same business. This means it is cheaper and more efficient for a business to specialize in a few products rather than focusing on diverse products. This occurs in the case presented because the production of turkey dogs and ham sandwiches increased the costs, which shows it is more efficient for the business to specialize in a few products. Thus, this vendor is experiencing diseconomies of scope.
Multiple-step income statement and balance sheet The following selected accounts and their current balances appear in the ledger of Kanpur Co. for the fiscal year ended June 30, 20Y7:
Cash $92,000
Retained Earnings $381,000
Accounts Receivable 450,000
Dividends 300,000
Inventory 370,000
Sales 8,925,000
Estimated Returns Inventory 5,000
Cost of Goods Sold 5,620,000
Office Supplies 10,000
Sales Salaries Expense 850,000
Prepaid Insurance 12,000
Advertising Expense 420,000
Office Equipment 220,000
Depreciation Expense—Store Equipment 33,000
Accumulated Depreciation—Office Equipment 58,000
Miscellaneous Selling Expense 18,000
Store Equipment 650,000
Office Salaries Expense 540,000
Accumulated Depreciation—Store Equipment 87,500
Rent Expense 48,000
Accounts Payable 38,500
Insurance Expense 24,000
Customers Refunds Payable 10,000
Depreciation Expense—Office Equipment 10,000
Salaries Payable 4,000
Office Supplies Expense 4,000
Note Payable (final payment due 2034) 140,000
Miscellaneous Administrative Exp. 6,000
Common Stock 50,000
Interest Expense 12,000
Required:
a. Prepare a multiple-step income statement.
b. Prepare a retained earnings statement.
Answer:
Net Profit 1345,000
Retained Earnings $ 1426,000
Explanation:
The multi step income statement shows the sections of the income statement separately such as the operating expenses and non operating expenses .
Kanpur Co.
Multi step Income Statement
For year ended June 30, 20Y7:
Sales 8,925,000
Cost of Goods Sold 5,620,000
Estimated Returns Inventory (5,000)
Adjusted Cost OF Goods Sold 5,615,000
Gross Profit $ 3310,000
Less Operating Expenses
Rent Expense 48,000
Selling And Administrative Expenses
Office Supplies Expense 4,000
Sales Salaries Expense 850,000
Miscellaneous Selling Expense 18,000
Depreciation Expense—Store Equipment 33,000
Office Salaries Expense 540,000
Depreciation Expense—Office Equipment 10,000
Advertising Expense 420,000
Miscellaneous Administrative Exp. 6,000
Total Operating Expenses 1881,000
Operating Income 1381,000
Other Expense
Insurance Expense 24,000
Interest Expense 12,000
Total Non Operating Expenses 36,000
Net Profit 1345,000
Kanpur Co.
Statement of Retained Earnings
For year ended June 30, 20Y7:
Retained Earnings $381,000
Add Net Profits 1345,000
Less Dividends 300,000
Retained Earnings For year ended June 30, 20Y7 $ 1426,000
According to the Coase theorem, private parties can negotiate to an efficient solution in the presence of externalities if the is (are) relatively low.Suppose Jeremy, Francis, and Andrew are part of Mu Epsilon Nu, a college fraternity known for its very loud, rambunctious weekend parties. The parties annoy many of the residents in nearby apartment complexes due to the loud music and blaring neon lights. This is a(n)example:________
a.external cost
b. positive externality
c. neither
Rough Stuff makes 2 products: khaki shorts and khaki pants for men. Each product passes through the cutting machine area, which is the chief constraint during production. Khaki shorts take 15 minutes on the cutting machine and have a contribution margin per pair of shorts of $16. Khaki pants take 24 minutes on the cutting machine and have a contribution margin per pair of pants of $32. If it is assumed that Rough Stuff has 4,800 hours available on the cutting machine to service a minimum demand for each product of 3,000 units, how much will profits increase if 100 more hours of machine time can be obtained?
Answer:
$8,000
Explanation:
khaki shorts khaki pants
machine minutes per unit 15 24
contribution margin per unit $16 $32
CM per machine minute $1.067 $1.33
minimum demand 3,000 3,000
machine minutes required 45,000 72,000
total machine minutes available 288,000
total machine minutes remaining 171,000
production 0 7,125
total production 3,000 10,125
total contribution margin $48,000 $324,000
if 100 more machines hours are added, then production time increases by 6,000 minutes which can be used to produce 250 more khaki pants. Contribution margin will increase by 250 x $32 = $8,000
I calculated contribution margin per minute, but you could also calculate contribution margin per hour to determine which product is more profitable. Contribution margin per hour for shorts = $64, and for pants = $80. The answer will not change.
The Universal Containers company thinks it knows everything about business. However, Einstein Discovery surfaces an unexpected pattern that is concerning. They call in department experts and hold a meeting to discuss next steps with an Einstein Consultant. What should the consultant advise as the next action?A. Determine if the pattern is a data issue or a new insightB. Filter out the data that causes the unexpected pattern and analyze the new resultsC. Accept the new pattern and have confidence that Einstein knows the business accurately to the customerD. Consult a Data Scientist for further analysis
Answer:
C. Accept the new pattern and have confidence that Einstein knows the business accurately to the customer.
Explanation:
The business consultants are experts in the field of business and they provide suggestions about certain issue. The Universal Containers Company thinks that they know everything about business but an unexpected pattern is observed. They call a meeting with Einstein Consultant and the consultant will advise to accept the new pattern and observe the customers. The company should have confidence that the consultant knows business accurately.
As sales manager, Joe Batista was given the following static budget report for selling expenses in the Clothing Department of Soria Company for the month of October.
SORIA COMPANY
Budget Report
For the Month Ended October 31, 2017
Budget Actual Difference
Favorable
Unfavorable
Neither Favorable nor Unfavorable
Sales in units 7,800 10,000 2,200 Favorable
Variable expenses
Sales commissions $1,872 $2,400 $528 Unfavorable
Advertising expenses 936 900 36 Favorable
Travel expense 3,120 4,000 880 Unfavorable
Free samples given out 1,794 1,300 494 Favorable
Total variable 7,722 8,600 878 Unfavorable
Fixed expenses
Rent 1,700 1,700 -0- Neither Favorable nor Unfavorable
Sales salaries 1,100 1,100 -0- Neither Favorable nor Unfavorable
Office salaries 800 800 -0- Neither Favorable nor Unfavorable
Depreciation-autos (sales staff) 400 400 -0- Neither Favorable nor Unfavorable
Total Fixed 4,000 4,000 -0- Neither Favorable nor Unfavorable
Total expenses $11,722 $12,600 $876 Unfavorable
As a result of this budget report, Joe was called into the president's office and congratulated on his fine sales performance. He was reprimanded, however, for allowing his costs to get out of control. Joe knew something was wrong with the performance report that he had been given. However, he was not sure what to do, and comes to you for advice.
Prepare a budget report based on flexible budget data to help Joe. (List variable costs before fixed costs. Do not leave any answer field blank. Enter 0 for amounts.)
SORIA COMPANY
Selling Expense
Flexible Budget Report
Clothing Department
For the Month Ended October 31, 2017
Difference
Favorable /Unfavorable /Neither Favorable nor Unfavorable
Budget Actual
Answer:
The flexible budget report shows that variable costs were $1,300 below budget.
Explanation:
SORIA COMPANY
Selling Expense Flexible Budget Report
Clothing Department
For the Month Ended October 31, 2017
Budget Actual Difference
Fav /Unfav /Neither
Fav nor Unfav
Sales in units 10,000 10,000 -0- Neither Fav nor Unfav
Variable Expenses
Sales in Commission
(0.24) 2400 2400 -0- Neither Fav nor Unfav
Advertising Expenses
936/7800* 10,000 1200 900 300 Fav
Travel Expense
3120/7800 *10,000 4000 4000 -0- Neither Fav nor Unfav
Free Samples Given Out
1794/7800 *10,000 2300 1300 1000 Fav
Total Variable
Expenses (0.99) 9,900 8,600 1300 Fav
Fixed Expenses
Rent 1700 1,700 -0- Neither Fav nor Unfav
Sales salaries 1,100 1,100 -0- Neither Fav nor Unfav
Office salaries 800 800 -0- Neither Fav nor Unfav
Depreciation-autos (sales staff)
400 400 -0- Neither Fav nor Unfav
Total Fixed 4,000 4,000 -0- Neither Fav nor Unfav
Total Expenses 13900 12600 1300 Favorable
From the above flexible budget report, variable costs were $1,300 below budget.
The flexible budget report shows that the variable costs is $1,300 below the budget.
SORIA COMPANY
Selling Expense Flexible Budget Report
For the Month Ended October 31, 2017
Particulars Budget Actual Difference (F/U)
Sales in units 10,000 10,000 -
Variable Expenses
Sales in Commission 2,400 2,400 -
(0.24*10,000)
Advertising Expenses 1,200 900 300 F
(936/7800*10,000)
Travel Expense 4,000 4,000 -
(936/7800*10,000)
Free Samples given out 2,300 1,300 1,000 F
(1794/7800 *10,000)
Total Variable Cost 9,900 8,600 1,300 Fav
Fixed Expenses
Rent 1,700 1,700 -
Sales salaries 1,100 1,100 -
Office salaries 800 800 -
Depreciation - autos 400 400 -
Total Fixed Cost 4,000 4,000 -
Total Expenses 13,900 12,600 1,300 Fav
In conclusion, the flexible budget report shows that the variable costs is $1,300 below the budget.
See similar solution here
brainly.com/question/16237446
Assume Time Warner shares have a market capitalization of $40 billion. The company is expected to pay a dividend of $0.25 per share and each share trades for $40. The growth rate in dividends is expected to be 7% per year. Also, Time Warner has $20 billion of debt that trades with a yield to maturity of 9%. If the firm's tax rate is 40%, what is the WACC
Answer:
6.88%
Explanation:
cost of equity = (next period dividend / by price) + growth rate in dividends.
cost of debt = yield to maturity x (1 - tax rate)
WACC = weight of debt x cost of debt + weight of equity x cost of equity.
cost of equity = ($0.25 / $40) + 0.07
= 0.07625
cost of debt = 0.09 x (1 - 0.4)
=0.054
WACC = ($40Billion x 0.07625) / 60billion + ($20 billion x 0.054) / $60billion
= 0.05083 + 0.018
= 0.0688 or 6.88%
You are going to sell your house. You are determining what the price should be. To help you, you have collected information of houses that have sold in your neighborhood during the past eighteen months. You checked houses within a four mile radius and here is the information you collected. You are going to base your determination of the price of your house based on the following information. Evaluate and discuss whether the data collected was appropriate and representative of the information that is needed to analyze the problem presented in the problem setting.
House House Age Square Feet Selling Price
1 33 1812 $190,000
2 32 1915 $205,200
3 32 1840 $194,000
4 32 1832 $192,000
5 33 1851 $202,000
6 34 2032 $208,600
7 31 1755 $188,200
8 30 1805 $205,000
9 28 1900 $215,000
10 29 1485 $192,000
11 31 1525 $195,000
12 32 1515 $192,200
13 33 1685 $201,300
14 34 1600 $205,400
15 35 1650 $218,000
ANSWER: The data collected is NOT an appropriate representation that can be used to determine how much you should sell your house.
EXPLANATION: A house is evaluated by the contents which were used to build it. For instance a house built with a bricks can not be of the same value with a wood or block house, even though they have the same pattern.
Because the data does not show the values of the contents of the house, which are: walls, pattern, designs, how many stirs, roof, and interior quality, it cannot be used to determine the price you should sell your house.
Also, looking at the data gotten, you can understand that this houses has been sold according to the contents that made up the building, because some old builder were sold more costlier than some new buildings, and some building with a much bigger square feet were sold in a lower price when compared to some buildings with a smaller square feet
During the year, the following selected transactions affecting stockholders' equity occurred for Navajo Corporation: a. Feb. 1 Repurchased 230 shares of the company's own common stock at $27 cash per share. b. Jul. 15 Sold 130 of the shares purchased on February 1 for $28 cash per share. c. Sept. 1 Sold 100 of the shares purchased on February 1 for $26 cash per share. Required: 1. Prepare the journal entry required for each of the above transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answer:
a. Feb. 1
Treasury Shares $6,210 (debit)
Cash $6,210 (credit)
b. Jul. 15
Cash $3,600 (debit)
Common Shares $3,600 (credit)
c. Sept. 1
Cash $2,600 (debit)
Common Shares $2,600 (credit)
Explanation:
The purchase of company own shares is known as Treasury Shares.This decreases the equity element (Treasury Shares) and decreases the Assets of Cash.
Issue of Company own shares increases the Equity element (Common Shares) and decreases the Assets of Cash.
James would like to deposit enough money in a savings account to have $8,000 at the end of year 3. Assuming the investment will earn 5% compounded annually, what amount should James deposit in the savings account today
Answer:
$6910.70
Explanation:
At the end of each year, the account balance will be 1.05 times the value at the beginning of the year. Thus, at the end of year 3, the value is 1.05^3 times the original value.
$8000 = (deposit)×1.05^3
deposit = $8000/1.05^3 ≈ $6910.70
James should deposit $6910.70 today.
S13-15 (similar to) Young Corporation discovered in 2019 that it had incorrectly recorded in 2018 a cash payment of $ 95 comma 000 for utilities expense. The correct amount of the utilities expense was $ 20 comma 000. Requirements 1. Determine the effect of the error on the accounting equation in 2018. 2. How should this error be reported in the 2019 financial statements?
Answer and Explanation:
1. The effect of the error on the accounting equation in 2018 is shown below:-
Error utilities expenses = Correct utilities expenses in 2018 - Wrongly entered utilities expenses
= $95,000 - $20,000
= $75,000
Here due to an increase in utilities expenses, so the net income will be decreased.
Now, the Decrease in net income, there will be decrease in stockholders equity
2. The error should be reported for the year 2019 financial statements as a prior period adjustment. It is an adjustment to the beginning balance in the retained earning account
And it will be an addition of the $20,000
