The bond has a coupon rate of 6.83 percent, it makes semiannual payments, and there are 4 months to the next coupon payment. A clean price of $1,049 and the par value is $1,000. What is the invoice price

Answers

Answer 1

Answer:

The invoice price for the bond is $1,060.38

Explanation:

Given the following:

PV= Par value = $1,000 ,

CV= Clean Price = $1,049

Coupon Rate per annum = 6.83%

To calculate the Semiannual Coupon Rate= Coupon Rate per annum/2= 3.415%

To calculate Semiannual Coupon= Semiannual Coupon Rate*PV

= 3.415% * $1,000  = $34.15

With an interest accured over 2 months, we calculate it thus:

Accrued Interest = $34.15 * 2/6 = $11.38

To calculate Invoice price:

Invoice Price = CP + Accrued Interest

Invoice Price = $1,049.00 + $11.38

Invoice Price = $1,060.38


Related Questions

Last year Carson Industries issued a 10-year, 13% semiannual coupon bond at its par value of $1,000. Currently, the bond can be called in 6 years at a price of $1,065 and it sells for $1,200. What is the bond's nominal yield to maturity

Answers

Answer:

10%

Explanation:

This can be calculated using the nominal yield to maturity (YTM) formula as follows:

Yield to maturity = [C + ((F - P) / n)] / [(F + P) / 2]  ........ (1)

Where;

F = Face or par value = $1,000

C = Coupon or interest payment = $1,000 * 13% = $130

P = quoted price = $1,200

n = Years to maturity = 10

Substituting the values into equation (1), we have:

Yield to maturity = [130 + ((1,000 - 1,200) / 10)] / [(1,000 + 1,200) / 2]  = 0.10, or 10%.

Goodwill should:________.
a. be written off as soon as possible against retained earnings.
b. absent impairment, not be written off because it has an indefinite life.
c. written off as soon as possible as an expense.
d. amortized over a maximum of forty years.

Answers

Answer:

d.amortized over a maximum of forty years

Avril Inc. bases its manufacturing overhead budget on budgeted direct labor-hours. The variable overhead rate is $4.60 per direct labor-hour. The company's budgeted fixed manufacturing overhead is $54,080 per month, which includes depreciation of $3,840. All other fixed manufacturing overhead costs represent current cash flows. The direct labor budget indicates that 3,200 direct labor-hours will be required in October. The company recomputes its predetermined overhead rate every month. The predetermined overhead rate for October should be:

Answers

Answer:

Estimated manufacturing overhead rate= $21.5 per direct labor hour

Explanation:

Giving the following information:

The variable overhead rate is $4.60 per direct labor-hour.

Budgeted fixed manufacturing overhead is $54,080 per month

The direct labor budget indicates that 3,200 direct labor-hours will be required in October.

To calculate the estimated manufacturing overhead rate we need to use the following formula:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Estimated manufacturing overhead rate= (54,080/3,200) + 4.6

Estimated manufacturing overhead rate= $21.5 per direct labor hour

Degregorio Corporation makes a product that uses a material with the following direct material standards:


Standard quantity 3.7 kilos per unit
Standard price $5 per kilo

The company produced 6,300 units in November using 23,780 kilos of the material. During the month, the company purchased 25,950 kilos of the direct material at a total cost of $124,560. The direct materials purchases variance is computed when the materials are purchased.

The materials quantity variance for November is:

A. $2,350 F

B. $2,256 F

C. $2,350 U

D. $2,256 U

Answers

Answer:

Materials quantity variance = $2,350 F

Explanation:

Given:

Standard quantity = 3.7 kilos per unit

Standard price = $5 per kilo

Unit produced = 6,300

Total material = 23,780

Computation:

Materials quantity variance = (Actual quantity × Standard price) - (Standard quantity × Standard price)

Materials quantity variance = (23,780 × $) - (6,300  × 3.7  × $5)

Materials quantity variance = $118,900 - $116,550

Materials quantity variance = $2,350 F

The evaluation of a firm's strengths, weaknesses, opportunities, and threats is called a SWOT analysis. A SWOT analysis can be a valuable tool in the development of a marketing plan, but too often the SWOT analysis is not well thought out and proves to be an ineffective waste of time. Perhaps the most common mistake when conducting a SWOT analysis is the failure to separate internal issues from external issues. The strengths and weaknesses aspects of the SWOT analysis focus on internal capabilities. The opportunities and threats aspects focus on the external environment. Select the most appropriate category for the descriptors below.1. Post office closings2. JPM has the superior information technology infrastructure3. Increasing demand for international packages4. JPM has an excellent workforce and human resource department5. Potential global economic recession6. JPM has increasing labor costs7. JPM has less fuel-efficient planes8. Increasing fuel costs due to turmoil in the Middle East

Answers

Answer: Please refer to Explanation

Explanation:

SWOT ANALYSIS is indeed a very useful matrix for evaluating a firm's strong points.

The Strengths and Weaknesses portion focus on the internal Environment with the Strengths looking at what the company does better than other companies and has a competitive advantage in while weaknesses look at where the company is lacking.

The Threats and Opportunities focus on the External Environment. The Threats refer to any and every potential source of negative effects on the company while Opportunities are the potential chances that a company can capitalise on to make themselves more profitable.

Classifying the above,

1. Post office closings. OPPORTUNITIES

This is because JPM as a Delivery Service can then take over the customers that can no longer use the closed Post Offices.

2. JPM has the superior information technology infrastructure. STRENGTHS.

This is an area that JPM excels in making it a strength.

3. Increasing demand for international packages. OPPORTUNITIES.

This is a chance for JPM to grow as they can capitalise on this increased demand to increase profitability.

4. JPM has an excellent workforce and human resource department. STRENGTH.

JPM has a strength in this area because this is something that they are good at.

5. Potential global economic recession. THREATS.

This is a Threat to JPM as it could potentially affect their business negatively.

6. JPM has increasing labor costs. WEAKNESSES.

This is an internal problem that is a weakness for JPM. Rising labour costs means lower profits so they should be careful.

7. JPM has less fuel-efficient planes. WEAKNESSES.

Less fuel efficient planes means that they burn more fuel to deliver goods around the world so they have more expenses. This is a weakness that needs to be curtailed.

8. Increasing fuel costs due to turmoil in the Middle East. THREATS.

This is a threat because it is from the External Environment but threatens to increase the costs of deliveries for JPM.

Grouper Company issued $612,000 of 10%, 20-year bonds on January 1, 2020, at 102. Interest is payable semiannually on July 1 and January 1. Grouper Company uses the effective-interest method of amortization for bond premium or discount. Assume an effective yield of 9.7705%.
Prepare the journal entries to record the following. (Round intermediate calculations to 6 decimal places, e.g. 1.251247 and final answer to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
(a) The issuance of the bonds.
(b) The payment of interest and related amortization on July 1, 2020.
(c) The accrual of interest and the related amortization on December 31, 2020.

Answers

Answer:

Bond issue:

Dr cash                               $624,240.00

Cr bonds payable                                                                       $612,000

Cr premium on bonds payable($624,240.00-$612,000)      $ 12,240

On 30 June:

Dr Interest expense                         $30,495.68  

Dr premium on bonds payable              $104.32  

Cr cash                                                                       $30,600

On 31 December :

Dr interest                                                                        $ 30,490.59  

Dr premium on bonds payable($30,600-$30,490.59)  $109.41

Cr interest payable                                                                             $30,600

Explanation:

The cash proceeds from the bond issuance is 102% of the face value of $612,000 i.e $ 624,240.00 (102%*$612,000)

The interest payment on 30 June=$612,000*10%*6/12=$30,600.00  

The interest expense on 30 June=$ 624,240.00*9.7705%*6/12=$30,495.68

amortization of premium=$30,600.00-$ 30,495.68=$104.32  

Carrying value of bond at 30 June=$ 624,240.00+$30,495.68 -$30,600=$624,135.68  

Interest expense on 31 December=$ 624,135.688*9.7705%*6/12=$30,490.59  

The continuous falling price level is called inflation.
True or false?

Answers

Answer:

True

Explanation:

When it start failling it is still true.

A stock you own earned: $200, $500, $100, and $700 over the last four years. What was the mean annual gain in value over the four years?

Answers

Answer:

$375

Explanation:

200+500+100+700= 1,500

1,500/4=375

Answer:

The answer is $375 (B)

Explanation:

First, add all the numbers (200, 500, 100, 700) to get 1,500

Divide by the mean which is 4 (1500/4)

Here's your answer $375 (B)

Hope this helps!

Which of the following situations would preclude an accountant from issuing a review report on a company's financial statements in accordance with Statements on Standards for Accounting and Review Services (SSARS)?

a. Finished-goods inventory does not include any overhead amounts.
b. The accountant was engaged to review only the balance sheet.
c. The owner of a company is the accountant's father.
d. Land has been recorded at appraisal value instead of historical cost.

Answers

Answer:

c. The owner of a company is the accountant's father.

Explanation:

Standard for Accounting and Review services (SSARS) is used for an entity that is not required to file financial statements with a regulatory body for sale of its securities in the public market.

It is concerned with unaudited financial statements and other unaudited information.

According to the SSARS when the accountant is exposed to bias by being related or having vested interest in the company he is precluded from issuing a review report on the companie's financial statements.

The Atlanta Company has assembled the following data pertaining to certain costs that cannot be easily identified as either fixed or variable. Atlanta Company has heard about a method of measuring cost functions called the high-low method and has decided to use it in this situation. Cost Hours $24,000 5,000 $26,100 6,300 $34,700 7,900 $48,000 11,000 $38,300 9,250 What is the cost function

Answers

Answer:

Total cost= 4,000 + 4x

x= hours

Explanation:

Giving the following information:

Cost Hours

$24,000 5,000

$26,100 6,300

$34,700 7,900

$48,000 11,000

$38,300 9,250

First, we need to calculate the unitary variable cost and fixed cost. We will use the following formulas:

Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)

Variable cost per unit= (48,000 - 24,000) / (11,000 - 5,000)

Variable cost per unit= $4 per unit

Fixed costs= Highest activity cost - (Variable cost per unit * HAU)

Fixed costs= 48,000 - (4*11,000)

Fixed costs= $4,000

Fixed costs= LAC - (Variable cost per unit* LAU)

Fixed costs= 24,000 - (4*5,000)

Fixed costs= $4,000

Now, we can express the cost formula:

Total cost= 4,000 + 4x

x= hours

Bev is opening her own court-reporting business. She financed the business by withdrawing money from her personal savings account. When she closed the account, the bank representative mentioned that she would have earned $300 in interest next year. If Bev hadn't opened her own business, she would have earned a salary of $25,000. In her first year, Bev's revenues were $30,000, and she spent $1,000 on materials and supplies. Which of the following statements is correct?a) Bev's total explicit costs are $25,300.
b) Bev's total implicit costs are $300.
c) Bev's accounting profits exceed her economic profits by $300.
d) Bev's economic profit is $4,700.

Answers

Answer:

Bev's total explicit costs are $1000

Bev's total implicit costs are $25,300

Bev's accounting profits exceed her economic profits by $25,300

Bev's economic profit is $3,700.

Explanation:

Accounting profit is total revenue less total explicit cost.

Explicit cost is actual cost incurred.

Accounting profit = Total revenue - Total explicit cost

Total explicit cost = $1,000

Total revenue = $30,000

Accounting profit = $30,000 - 1,000 = $29,000

Economic profit is accounting profit less implicit cost or opportunity cost.

Opportunity cost is the cost of the next best option forgone when one alternative is chosen over other alternatives.

Implicit cost = $300 + $25,000 = $25,300

Economic profit = $29,000 - $25,300 = $3,700

I hope my answer helps you

Why do you think the value of the Indian rupee declined against that of the U.S. dollar after the U.S. Fed had announced that it would begin to wind down its economic stimulus program

Answers

Answer:

Because the United States interest moved up and Indian Rupees depends mostly on the capital from the United States of America.

Explanation:

So, about the Indian rupees there are things we must note; (1). The inflation on Indian Rupees is high, (2). The problem of deficit account by the Rupee.

The two problems mentioned above are the problems that made Indian Rupees to rest or relent mostly on the United States of America Fed's cash flow. So, when U.S. Fed announced that it would begin to wind down its economic stimulus program the value of Indian Rupees DECREASES.

Someone is retiring next year.What would be an appropriate amount of risk to take with their investments?

Answers

In purchasing few properties depending on their budget which will provide them with allowance as income

Assume that a parent company acquires a 70% interest in a subsidiary for a purchase price of $1,078,000. The excess of total fair value of controlling and noncontrolling interests over book value is assigned to; a building (PPE net) that is worth $100,000 more than book value, an unrecorded patent valued at $200,000 and goodwill valued at $300,000. Goodwill is assigned proportionately to the controlling and noncontrolling interests
Submission Requirements:
Using the ACT470_Mod03-Option01.xlsx Excel spreadsheet in the Module 3 folder:
Prepare the consolidated balance sheet at the date of acquisition by placing the appropriate entries in their respective debit/credit column cells.
Indicate, in the blank column cell to the left of the debit and credit column cells if the entry is an [E] or [A] entry.
Use Excel formulas to derive the Consolidated column amounts and totals.
Using the "Home" key in Excel, go to the "Styles" area and highlight the [E] and [A] entry cells in different shades.
Consolidation Entries
Parent Subsidia Dr Cr Consolidated
Cash 920,000 215,000 0
Accounts receivable 782,000 330,000 0
Inventory 1,100,000 425,000 0
Equity investment 1,078,000 0
Property, plant and equipment (PPE), net 5,400,000 800,000
Patent 0
Goodwill 0
Total assets 9,280,000 1,770,000 0
Current liabilities 810,000 330,000 0
Long-term liabilities 4,000,000 500,000
Common stock 920,000 90,000 0
Additional paid-in capital 700,000 120,000 0
Retained earnings 2,850,000 730,000 0
Noncontrolling interest 0
Total liabilities and equity 9,280,000 1,770,000 0

Answers

Answer:

Explanation:

The objective here is to prepare the consolidated balance sheet at the date of acquisition by placing the appropriate entries in their respective debit/credit column cells.

To do that; We need to find both Consolidation entries  and Consolidation Spreadsheet on the acquisition date from the given data set from the question.

From the question:

A parent company acquires a 70% interest in a subsidiary for a purchase price of $1,078,000.

Consideration paid by the parent company for 70% share    $10,78,000

Non Control Interest fair Value (30%)                                       $ 4,62,000      

Total fair value of subsidiary on the acquisition date               $15,40,000

Less: Book value subsidiary on the acquisition date

Common Stock                                          90,000

APIC                                                           1,20,000

Retained earnings                                     7,30,000                   $9,40,000    

Fair value in excess of book value                                               $6,00,000

Excess fair value allocated to:

undervalued building                                                           $1,00,000

unrecorded patent                                                                  $2,00,000

Goodwill                                                                                  $3,00,000

Balance                                                                                                 $0

Consolidation entries  and Consolidation Spreadsheet on the acquisition date are being embedded in the word document attached below due to vast columns of table sets that this answering box cannot contain.

A limited partnership: Multiple Choice May only have two partners. Has owners called stockholders. Includes a general partner with unlimited liability. Is the same as a corporation. Is subject to double taxation.

Answers

Answer:

Is the same as a corporation.

Explanation:

The partnership is a firm in which there are two or more partners comes in a contract to share the profit and losses to their profit and losses sharing ratio

A limited partnership is a partnership firm in which the partners have limited liability to their investment but the general partner has unlimited liability

It is just like a corporation who contains limited partners with the limited liability

John was driving his car in a careless way, failing to drive as a reasonably prudent person would under the driving conditions. Ramona was crossing the street in a careless way, failing to cross as a reasonably prudent person would. John struck and injured Ramona with the car John was driving. At trial, it was determined that John was 80 percent at fault and that Ramona was 20 percent at fault. The injuries sustained amounted to $100,000. Explain how much, if any, recovery Ramona would receive in a state that applies the contributory negligence rule. Do the same thing for a state that applies the comparative negligence rule

Answers

Answer:

1. If this law of contributory negligence applies to the state, then Ramona will receive no compensation for the damages she sustained.

2. If this law of comparative negligence applies to this state, then Ramona will get 100% - 20% = 80% of the damages incurred in the accident, from John which will be $80,000

Explanation:

In contributory negligence, the defense completely bars plaintiffs from any recovery if they contribute to their own injury through their own negligence.

If this law of contributory negligence applies to the state, then Ramona will receive no compensation for the damages she sustained.

In comparative negligence, the plaintiff's damages is award by the percentage of fault that the fact-finder assigns to the plaintiff for his or her own injury i.e the plaintiff's damage compensation is reduced by percentage of his/her percentage of fault.

If this law of comparative negligence applies to this state, then Ramona will get 100% - 20% = 80% of the damages incurred in the accident, from John

this is 80% of $100,00 which is equal to $80,000

On January 1, a company purchased a five-year insurance policy for $2,200 with coverage starting immediately. If the purchase was recorded in the Prepaid Insurance account, and the company records adjustments only at year-end, the adjusting entry at the end of the first year is:

Answers

Answer:

Debit Insurance Expense 440

Credit Prepaid Insurace 440

Explanation:

Since on January 1, the company purchased a five year insurance policy for $2,200 that means we have to divide the insurance policy amount of $2,200 by the numbers of year which is 5 years .

Hence:

$2,200/5 years

=440

Therefore the adjusting entry at the end of the first year is:

Debit Insurance Expense 440

Credit Prepaid Insurace 440

Simon Company's year-end balance sheets follow. At December 31 Current Yr 1 Yr Ago 2 Yrs Ago Assets Cash $ 33,817 $ 40,739 $ 42,420 Accounts receivable, net 100,012 69,175 53,814 Merchandise inventory 128,260 91,410 59,663 Prepaid expenses 11,001 10,482 4,576 Plant assets, net 311,773 292,386 255,527 Total assets $ 584,863 $ 504,192 $ 416,000 Liabilities and Equity Accounts payable $ 141,262 $ 85,208 $ 56,010 Long-term notes payable secured by mortgages on plant assets 108,855 118,283 91,936 Common stock, $10 par value 163,500 163,500 163,500 Retained earnings 171,246 137,201 104,554 Total liabilities and equity $ 584,863 $ 504,192 $ 416,000 1. Express the balance sheets in common-size percents. (Do not round intermediate calculations and round your final percentage answers to 1 decimal place.) 2. Assuming annual sales have not changed in the last three years, is the change in accounts receivable as a percentage of total assets favorable or unfavorable? 3. Assuming annual sales have not changed in the last three years, is the change in merchandise inventory as a percentage of total assets favorable or unfavorable?

Answers

Answer:

Simon Company's

Balance Sheets at December 31L

                                          Current Yr   %      1 Yr Ago     %     2 Yrs Ago   %

Assets

Cash                                    $ 33,817      6     $ 40,739    8     $ 42,420    10

Accounts receivable, net    100,012      17        69,175   14         53,814     13 Merchandise inventory      128,260     22        91,410    18       59,663     14

Prepaid expenses                  11,001       2        10,482     2          4,576      1

Plant assets, net                   311,773    53     292,386   57     255,527    61

Total assets                    $ 584,863    100  $ 504,192  100  $ 416,000  100

Liabilities and Equity

Accounts payable           $ 141,262      24    $ 85,208    17     $ 56,010    13

Long-term notes payable 108,855      19        118,283    23       91,936    22 Common stock,

        $10 par value           163,500      28       163,500   32     163,500    39 Retained earnings             171,246      29        137,201   27      104,554    25

Total liabilities & equity$ 584,863    100    $ 504,192  100 $ 416,000   100

2. Assuming annual sales have not changed in the last three years, the change in accounts receivable as a percentage of total assets is favorable.  It is always better to maintain low accounts receivable, thereby reducing credit risk exposures.

3. Assuming annual sales have not changed in the last three years, the change in merchandise inventory as a percentage of total assets is favorable.  Less inventory means that working capital is not being tied down to inventory.

Explanation:

Common-size percentages are used in analyzing the balance sheet.   The calculations set each line item as a percent of the total assets.

E-Eyes has a new issue of preferred stock it calls 20/20 preferred. The stock will pay a $20 dividend per year, but the first dividend will not be paid until 20 years from today. If you require a return of 11 percent on this stock, how much should you pay today

Answers

Answer:

Price to be paid for the stock = $25.032

Explanation:

A preferred stock pays a constant amount of dividends in perpetuity.

Using the dividend valuation model, the estimate price of such a stock would be the present value (PV) of the perpetuity.

This given below as dollows:

PV= A/r

A-constant dividend,- 20 ,

r- rate of return- 11%

PV of dividend in Year 19

PV = 20/0.11= 181.8181818

PV in year in year 0

PV = 181.8181818  × 1.11^(-19) = 25.032

Price to be paid for the stock = $25.032

When a project has a "hard gate," like being ready on time, how does that affect normal success criteria? Is it fair to judge a project with a critical completion date by normal project success standards? Why or why not?

Answers

Explanation:

The issue that determines the success of a project is usually attributed to managing the scope of the project.  Therefore, in some projects, the deadline for completion is not necessarily the most fundamental criterion that will incur your success.

Every project has a defined deadline for the beginning and the end, so the project management must be planned so that the time is sufficient for the execution of its tasks that will lead to the achievement of the objectives and goals.

Therefore, it is not fair to judge a project with a critical completion date, due to the fact that the project was developed and controlled so that success was related to other more important variables for such a project, not only time, but also its effectiveness , cost-benefit, quality, costs, etc.

Obtain the linear trend equation for the following data on new checking accounts at Fair Savings Bank and use it to predict expected new checking accounts for periods 16 through 19. (Round your intermediate calculations and final answers to 2 decimal places.)
Period New Accounts Period New Accounts Period New Accounts
1 200 6 239 11 281
2 215 7 241 12 275
3 211 8 250 13 282
4 224 9 254 14 288
5 235 10 267 15 308
Y = + t
Y16 =
Y17 =
Y18 =
Y19 =
Use trend-adjusted smoothing with %u03B1 = .2 and %u03B2 = .1 to smooth the new account data in part a. What is the forecast for period 16? (Use the "Trend" values to 3 decimal places and other values to 2 decimal places for intermediate calculations. Round your final answer to 2 decimal places.)

Answers

Answer:

Y16 = 7(16) + 195.33 = 307.33

Y17 = 7(17) + 195.33 = 314.33

Y18 = 7(18) + 195.33 = 321.33

Y19 = 7(19) + 195.33 = 328.33

Explanation:

Period (x)

New accounts (Y)

The regression equation:

Y = mx + t

Y is the dependent variable

X is the independent variable

t point where trend line cuts through the x-axis

M is the gradient or slope

Using the regression calculator, the trend line for the data is :

Y = 7X + 195.33

Using the regression equation obtained :

Y16 = 7(16) + 195.33 = 307.33

Y17 = 7(17) + 195.33 = 314.33

Y18 = 7(18) + 195.33 = 321.33

Y19 = 7(19) + 195.33 = 328.33

Entries for Stock Dividends Senior Life Co. is an HMO for businesses in the Portland area. The following account balances appear on the balance sheet of Senior Life Co.: Common stock (250,000 shares authorized; 6,000 shares issued), $75 par, $450,000; Paid-In Capital in excess of par— common stock, $48,000; and Retained earnings, $4,500,000. The board of directors declared a 2% stock dividend when the market price of the stock was $95 a share. Senior Life Co. reported no income or loss for the current year. If an amount box does not require an entry, leave it_______.A1. Journalize the entry to record the dedaration of the dividend, capitalizing an amount equal to market value. Stock Dividends 10,440 Stock Dividends Distributable 7,500 Paid In Capital in Excess of Par Common Stock 3,120 A2. Journalize the entry to record the issuance of the stock certificates. ) Stock Dividends 7,500 Common Stock 7,500.B. Determine the following amounts before the stock dividend was dedared: (1) total paid-in capital, (2) total and retained earning (3) total stockholders' equity. Total paid-in capital 828,000Total retained earnings 6,000,000 Total stockholders' equity 6,828,000C. Determine the following amounts after the stock dividend was dedlared and closing entries were recorded at the end of the year:Total paid-in capitalTotal retained earningsTotal stockholders' equity

Answers

Answer:

common stock = 6,000 at $75 par = $450,000

additional paid in capital = $48,000

retained earnings = $4,500,000

market price per stock $95

since the stock dividend is 2% (= 6,000 x 2% = , then we must use the market price to calculate it:

A1. Journalize the entry to record the declaration of the dividend, capitalizing an amount equal to market value.

Dr Retained earnings 11,400

    Cr Common stock dividend distributable 9,000

    Cr Additional paid in capital 2,400

A2. Journalize the entry to record the issuance of the stock certificates.

Dr Common stock dividend distributable 9,000

    Cr Common stock 9,000

B. Determine the following amounts before the stock dividend was declared:

(1) total paid-in capital = $48,000

(2) total retained earning = $4,500,000

(3) total stockholders' equity = $4,998,000

C. Determine the following amounts after the stock dividend was declared and closing entries were recorded at the end of the year:

(1) total paid-in capital = $50,400

(2) total retained earning = $4,488,600

(3) total stockholders' equity = $4,998,000

Karla Tanner opens a web consulting business called Linkworks and recorded the following transactions in its first month of operations.

Apr. 1 Tanner invests $80,000 cash along with office equipment valued at $26,000 in the company in exchange for common stock.
Apr. 2 The company prepaid $9,000 cash for twelve months' rent for office space. The company's policy is record prepaid expenses in balance sheet accounts.
Apr. 3 The company made credit purchases for $8,000 in office equipment and $3,600 in office supplies. Payment is due within 10 days.
Apr. 6 The company completed services for a client and immediately received $4,000 cash.
Apr. 9 The company completed a $6,000 project for a client, who must pay within 30 days.
Apr. 13 The company paid $11,600 cash to settle the account payable created on April 3.
Apr. 19 The company paid $2,400 cash for the premium on a 12-month insurance policy. The company's policy is record prepaid expenses in balance sheet accounts.
Apr. 22 The company received $4,400 cash as partial payment for the work completed on April 9.
Apr. 25 The company completed work for another client for $2,890 on credit.
Apr. 28 The company paid $5,500 cash in dividends.
Apr. 29 The company purchased $600 of additional office supplies on credit.
Apr. 30 The company paid $435 cash for this month's utility bill.
Descriptions of items that require adjusting entries on April 30, 2015, follow.

a) On April 2, the company prepaid $9,000 cash for twelve months' rent for office space.

b) The balance in Prepaid insurance represents the premium paid for a 12-month insurance policy; the policy's coverage began on April 1.

c) Office supplies on hand as of April 30 total $1,200.

d) Straight-line depreciation of office equipment, based on a 5-year life and a $4,000 salvage value, is $500 per month.

e) The company has completed work for a client, but has not yet billed the $1,800 fee.

f) Wages due to employees, but not yet paid, as of April 30 total $2,600.

Use the 3-step adjusting entry process to prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred:

Step 1: Determine what the current account balance equals (See General Ledger tab)

Step 2: Determine what the current account balance should equal.

Step 3: Prepare an adjusting entry to get from Step 1 to Step 2.

Generally Accepted Accounting Principles (GAAP):
The GAAP is a blend of recommendations from government bodies and widely accepted accounting principles for reporting information. It promotes openness in the exchange of economic data and makes clear and consistent financial reporting possible across organizations.

Answers

Answer:

a) On April 2, the company prepaid $9,000 cash for twelve months' rent for office space.

Step 1:

Prepaid rent $9,000

Step 2:

Prepaid rent $9,000 - $750 = $8,250

Step 3:

Dr Rent expense 750

    Cr Prepaid rent 750

b) The balance in Prepaid insurance represents the premium paid for a 12-month insurance policy; the policy's coverage began on April 1.

Step 1:

Prepaid insurance $2,400

Step 2:

Prepaid rent $2,400 - $200 = $2,200

Step 3:

Dr Insurance expense 200

    Cr Prepaid expenses 200

c) Office supplies on hand as of April 30 total $1,200.

Step 1:

Office supplies $3,600 + $600 = $4,200

Step 2:

Office supplies $4,200 - $3,000 = $1,200

Step 3:

Dr Office supplies expense 3,000

    Cr Office supplies 3,000

d) Straight-line depreciation of office equipment, based on a 5-year life and a $4,000 salvage value, is $500 per month.

Step 1:

Office equipment $26,000 + $8,000 = $34,000

Step 2:

Office supplies $34,000 - $500 = $33,500

Step 3:

Dr Depreciation expense 500

    Cr Accumulated depreciation - equipment 500

e) The company has completed work for a client, but has not yet billed the $1,800 fee.

Step 1:

Service revenue $4,000 + $6,000 + $2,890 = $12,890

Step 2:

Service revenue $12,890 + $1,800 = $14,690

Step 3:

Dr Accrued receivable 1,800

    Cr Service revenue 1,800

f) Wages due to employees, but not yet paid, as of April 30 total $2,600.

Step 1:

Wages expense $0

Step 2:

Wages expense $0 + $2,600 = $2,600

Step 3:

Dr Wages expense 2,600

    Cr Wages payable 2,600

At the beginning of the month, Arthur's Olde Consulting Corporation had two jobs in process that had the following costs assigned from previous months:
Job Number Direct Labor Applied Overhead
SY-400 $ 23,790 ?
SY-403 15,870 ?
During the month, Jobs SY-400 and SY-403 were completed but not billed to customers. The completion costs for SY-400 required $26,700 in direct labor. For SY-403, $79,500 in labor was used.
During the month, the only new job, SY-404, was started but not finished. Total direct labor costs for all jobs amounted to $150,570 for the month. Overhead in this company refers to the cost of work that is not directly traced to particular jobs, including copying, printing, and travel costs to meet with clients. Overhead is applied at a rate of 70 percent of direct labor costs for this and previous periods. Actual overhead for the month was $107,600.
Required:
(a) What are the costs of Jobs SY-400 and SY-403 at the beginning of the month and when completed?
(b) What is the cost of Job SY-404 at the end of the month?
(c) How much was under- or overapplied service overhead for the month?

Answers

Answer:

Cost at the beginning:

Cost of SY-400 $40,443.00

Cost SY-403 $ 26,979.00  

Cost at month end:

Cost of SY-400 $85,833.00  

Cost of SY-403 $162,129.00  

Cost of SY-404 $75429

Overhead was under-applied by $2,201.00

Explanation:

At the beginning of the month costs of jobs SY-400 and SY-403 are the direct labor costs incurred already plus 70% of the direct labor cost as overhead applied:

Cost of SY-400=$23,790+($23,790*70%)=$40,443.00

Cost SY-403=$15,870+($15,870*70%) =$ 26,979.00  

Costs at the end of the month would be cost at the beginning plus new direct labor cost incurred as well as the overhead on the new direct labor cost:

Cost of SY-400=$40,443.00+$26,700+($26,700*70%)=$85,833.00  

Cost of SY-403=$ 26,979.00+$79500+(70%*$79500)=$162,129.00  

Direct labor cost of SY-404=$150,570- $26,700-$79,500=$44370

Cost of SY-404=$44370+(70%*$44370)=$75429

Actual overhead is $107,600

Overhead applied=(70%*$44370)+(70%*$79500)+($26,700*70%)=$105,399.00  

Under-applied overhead=$107,600-$105,399=$2,201.00  

a) The cost of Jobs SY-400 and SY-403 at the beginning of the month and on completion are:

                                SY-400        SY=403  

Beginning costs     $40,443        $26,979

Total costs            $85,833       $162,129    

b) The cost of Job SY-404 at the end of the month is $75,429.

c) The Service Overhead for the month was underapplied by $2,201.

Data and Calculations:

Job Number   Direct Labor   Applied Overhead                       Total Costs

SY-400             $ 23,790          ? = $16,653 ($23,790 x 70%)     $40,443

SY-403                 15,870          ? =  $11,109 ($15,870 x 70%)       $26,979

                                SY-400        SY=403          SY404          Total Costs

Beginning costs     $40,443        $26,979          $0                   $67,422

Direct labor              26,700          79,500        $44,370          $150,570

Overhead applied   18,690          55,650           31,059            105,399

Total costs           $85,833       $162,129       $75,429          $323,391

Overhead applied = $105,399

Actual overhead      $107,600

Underapplied o/h =     $2,201

Learn more: https://brainly.com/question/24516871

Richard Palm is the accounting clerk of Olive Limited. He uses the source documents such as purchase orders, sales invoices and suppliers’ invoices to prepare journal vouchers for general ledger entries. Each day he posts the journal vouchers to the general ledger and the related subsidiary ledgers. At the end of each month, he reconciles the subsidiary accounts to their control accounts in the general ledger to ensure they balance. Discuss the internal control weaknesses and risks associated with the above process. (10 marks 300 words)

Answers

Answer:

Olive Limited

1) Internal Control Weaknesses: Richard Palm is just an accounting clerk and obviously there is a lack of qualification for him to single-handedly complete his work without supervision.  He handles the whole processes of identifying source documents, the accounts involved, and their correctness, preparing the journal, posting to the ledgers, and leger accounts reconciliation.  This shows that there is no segregation of duties. There is no personnel that authorizes or reviews Richard's accounting processes.  He engages in self-review (reconciliation) of his work.

2) The risks associated with Richard's process are:

a) Richard lacks the required professional experience and qualification to handle most of his work alone.  Thus, the risk of misstatement of financial statement elements is high.

b) Since Richard works without appropriate supervision, there is an increased risk of fraudulent behaviors.  Richard could post fictitious invoices to the accounting records.

c) Without separation of duties, a single individual handles a transaction from the beginning to the end.  This does not augur well for internal controls, which can be easily compromised.

d) Designated managers should be required to authorize certain types of transactions to add an extra layer of responsibility to accounting records.  This also proves that transactions have been seen, analyzed, and approved by appropriate authorities.   The requirement that large payments and expenses be approved by specific managers stop unscrupulous employees from making large fraudulent transactions with company funds, for example.

e) Richard also self-reviews his work.  Thus, it may be difficult for him to identify errors of misstatement.  An invoice could be posted more than once in the accounting records without being identified.

Explanation:

Internal controls are business processes that provide reasonable assurance so that several key business objectives are met, processes are operating efficiently, the financial reporting is reliable, and that the business is in compliance with applicable regulations and internal procedures.

Weaknesses occur when there is an absence of internal controls or the controls are not being operated as specified or the control objectives are not being achieved.  When any of these are prevalent, risks arise.  The risks may lead to intentional and unintentional financial statement misstatements or fraudulent practices.

Jardine Consulting Co. has the following accounts in its ledger: Cash, Accounts Receivable, Supplies, Office Equipment, Accounts Payable, Common Stock, Retained Earnings, Dividends, Fes Earned, Rent Expense, Advertising Expense, Utility Expense, Miscellaneous Expense.Journalize the following selected transactions for March 2016 in a two-column journal. Journal entry explanations may be omitted.Mar.1. Paid rent for the month, $2,500.3. Paid advertising expense, $675.5. Paid cash for supplies, $1,250.6. Purchased office equipment on account, $9,500.10. Received cash form customers on account, $16,550.15. Paid creditor on the account, $3,180.27. Paid cash for repairs to office equipment, $540.30. Paid telephons bill for the month, $375.31. Fees earned and billed to customers for the month, $49,770.31. Paid electricity bill for the month, $830

Answers

Answer:

Mar.1

Rent Expense $2,500 (debit)

Cash $2,500 (credit)

Mar.3

Advertising Expense $675 (debit)

Cash $675 (credit)

Mar.5

Supplies $1,250 (debit)

Cash $1,250 (credit)

Mar.6

Office equipment $9,500 (debit)

Accounts Payable $9,500 (credit)

Mar.10

Cash $16,550 (debit)

Accounts Receivable $16,550 (credit)

Mar.15

Accounts Payable $3,180  (debit)

Cash $3,180 (credit)

Mar.27

Miscellaneous Expense $540 (debit)

Cash $540 (credit)

Mar.30

Utility Expense $375 (debit)

Cash $375 (credit)

Mar. 31

Accounts Receivable $49,770 (debit)

Fees Earned $49,770 (credit)

Mar. 31

Utility Expense $830 (debit)

Cash $830 (credit)

Explanation:

Telephone Bill and Electricity Bill are both utilities used for operations hence entered under Utility Expense Account.

Repairs to Office Equipment was entered in the Account Title Miscellaneous Expense because of all the Account Titles for this Company, this is the most appropriate.

Sammy's Shovels had sales of $ 90,880 in 2010. The cost of goods sold was $ 34,863 , operating expenses (excluding depreciation) were $ 11,490 , interest expenses were $ 1,317 , depreciation expense was $ 7,961 , and dividends paid were $ 3,415 . The firm's tax rate is 27 percent. What did Sammy's Shovels report as net income (or, net profit) in 2010

Answers

Answer: $25731.77

Explanation:

The attached picture explains the way to solve the question. It would be noted that the expenses like the operating, depreciation, interest expense and the cost of good sold were all subtracted from the sales revenue.

Then the income before tax was $35249. Then the tax expense of 27% was deducted.

Income Tax expense = 27% of $35249 = $9517.23

Net profit = $35249 - $9517.23 = $25731.77

The net profit for Sammy Shovels is $25731.77.

Consider two countries, Alpha and Beta. In Alpha, real GDP per capita is $6,000. In Beta, real GDP per capita is $9,000. Based on the economic growth model, what would you predict about the growth rates in real GDP per capita across these two countries

Answers

Answer:

The growth rate of real GDP per capita will be higher in Alpha than it is in Beta

Explanation:

If we are to based on the economic growth model, what I would predict about the growth rates in real GDP per capita across ALPA and BETA is that when both countries are been compared with one another The growth rate of real GDP per capita will be higher in Alpha than it is in Beta because the Alpha real GDP per capita is said to be $6,000 while Beta real GDP per capita is said to be $9,000 which means growth rate of real GDP per capita will be much more higher in Alpha than it is in Beta.

Cotrone Beverages makes energy drinks in three flavors: Original, Strawberry, and Orange. Company is currently operating at 75 percent of capacity. Worried about the company's performance, the company president is considering dropping the Strawberry flavor. If Strawberry is dropped, the revenue associated with it would be lost and the related variable costs saved. In addition, the company’s total fixed costs would be reduced by 20 percent.

Segmented income statements appear as follows:

Product Original Strawberry Orange
Sales $65,200 $85,600 $102,400
Variable costs 44,000 77,200 80,200
Contribution margin $21,200 $8,400 $22,200
Fixed costs allocated to each product line 9,400 12,000 14,200
Operating profit (loss) $11,800 $(3,600) $8,000

Required:

a. Prepare a differential cost schedule.
b. Should Cotrone drop the Strawberry product line?

Answers

Answer:

Yes Strawberry line should be dropped as it reduces the overall profit by$ 3600 when the fixed costs are not 20 %

Yes Strawberry line should be dropped as it reduces the overall profit by$ 1720 even when the fixed costs are  20 %

Explanation:

Cotrone Beverages

Differential Analysis

                          Totals                    Totals             Difference / Change

                      including    (less)   Without   (equals)

                     Strawberry             Strawberry

Sales                           253,200    167,600           85600  Decrease

Variable costs              201,400   124,200          77200    Decrease

Fixed costs allocated  35,600        28,480          7120    Decrease

Operating profit (loss)   13,200       14,920           (1720)     Increase

Working

Total Fixed Costs Reduced will be = 35,600 *20%= 7120

Here we see the profit is increased by 1720 therefore strawberry line should be dropped.

Cotrone Beverages

Differential Analysis

                          Totals                    Totals             Difference / Change

                      including    (less)   Without   (equals)

                     Strawberry             Strawberry

Sales                           253,200    167,600           85600  Decrease

Variable costs              201,400   124,200          77200    Decrease

Contribution margin     51,800       43,400           8,400    Decrease

Fixed costs allocated  35,600        23,600          12000    Decrease

Operating profit (loss)   13,200       16,800           (3,600)   Increase

Yes Strawberry line should be dropped as it reduces the overall profit by$ 3600

Working

We find the totals with and without the strawberry product line and then subtract to find the   differential costs

Cotrone Beverages

Product                        Original             Strawberry       Orange     Total

Sales                            $65,200            $85,600         $102,400   253,200

Variable costs              44,000              77,200             80,200      201,400

Contribution margin $21,200                $8,400          $22,200       51,800

Fixed costs allocated 9,400                  12,000              14,200     35,600

Operating profit (loss) $11,800               $(3,600)           $8,000     13,200

If we drop the strawberry line then the new totals would be

Product                        Original          Orange      Total

Sales                            $65,200       $102,400   167,600

Variable costs              44,000          80,200      124,200

Contribution margin $21,200          $22,200       43,400

Fixed costs allocated 9,400               14,200     23,600

Operating profit (loss) $11,800           $8,000     16,800

Ecominus Eliminator Manufacturing produces a chemical pesticide and uses process costing. There are three processing departmentslong dash​Mixing, ​Refining, and Packaging. On January​ 1, the first departmentlong dashMixinglong dashhad no beginning inventory. During​ January, 48 comma 000 fl. oz. of chemicals were started in production. Of​ these, 38 comma 000 fl. oz. were​ completed, and 10 comma 000 fl. oz. remained in process. In the Mixing​ Department, all direct materials are added at the beginning of the production​ process, and conversion costs are applied evenly throughout the process. The weightedminusaverage method is used.
At the end of January, the equivalent unit data for the Mixing Department were as follows:
WHOLE UNITS Equivalent Units Equivalent Units
Units to be accounted for Direct Materials Cost Conversion Costs
Completed and transferred out 38,000 38,000 38,000
Ending work-in-process 10,000 10,000 44,00
48,000 48,000 42,400
Percent complete for conversion costs: 44%
In addition to the above, the costs per equivalent unit were $1.35 for direct m conversion costs. Using this data, calculate the full cost of the ending WIP balance in the Mixing Department. The weighted-average method is used.
A) $36,380
B) $13,500
C) $64,800
D) $42,400

Answers

Answer:

A) $36,380

INCOMPLETE INFORMATION

The text from the book states:

$1.35 direct materials equivalent unit cost

$5.20 conversion cost equivalent unit cost

Explanation:

We must look at the ending work-in-process line and multiply the above equivalent cost by the units to be accounted for on each category

10,000 units x $ 1.35 materials cost = $  13,500 material cost

 4,400 units x $5.20 conversion cost = $ 22,880 converion cost

total cost 22,880 + 13,500 = 36,380

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