Answer:
$84
Explanation:
Calculation to determine the inventory cost per unit using absorption costing
Direct materials $18
Indirect materials (variable) $3
Direct labor $9
Indirect labor (variable) $7
Other variable factory overhead $13
Fixed factory overhead $34
Inventory cost per unit $84
($18 + $3 + $9 + $7 + $13 + $34 = $84
Therefore the inventory cost per unit using absorption costing is $84
On January 1, 2018, the Highlands Company began construction on a new manufacturing facility for its own use. The building was completed in 2019. The company borrowed $2,350,000 at 9% on January 1 to help finance the construction. In addition to the construction loan, Highlands had the following debt outstanding throughout 2018: $7,000,000, 14% bonds $3,000,000, 9% long-term note Construction expenditures incurred during 2018 were as follows: January 1 $ 960,000 March 31 1,560,000 June 30 1,232,000 September 30 960,000 December 31 760,000 Required: Calculate the amount of interest capitalized for 2018 using the specific interest method. (Do not round the intermediate calculations. Round your percentage answers to 1 decimal place (i.e. 0.123 should be entered as 12.3%).)
Answer:
Highlands Company
The interest capitalized for 2018 using the specific interest method is:
= $268,740.
Explanation:
a) Data and Calculations:
Amount borrowed on January 1, 2018 = $2,350,000
Rate of interest for the construction loan = 9%
Outstanding debts throughout 2018:
$7,000,000, 14% bonds
$3,000,000, 9% long-term note
Construction Expenditures incurred during 2018:
Date Expenditure Weight Weighted Average
January 1 $ 960,000 12/12 $960,000
March 31 1,560,000 9/12 1,170,000
June 30 1,232,000 6/12 616,000
September 30 960,000 3/12 240,000
December 31 760,000 0/12 0
Total accumulated weighted-average expenditure = $2,986,000
Interest capitalized for 2018 using the specific interest method:
= $268,740 ($2,986,000 * 9%)
Craig Company asks you to review its December 31, 2014, inventory values and prepare the necessary adjustments to the books. The following information is given to you. 1. Craig uses the periodic method of recording inventory. A physical count reveals $234,890 of inventory on hand at December 31, 2014.2. Not included in the physical count of inventory is $13,420 of merchandise purchased on December 15 from Browser. This merchandise was shipped f.o.b. shipping point on December 29 and arrived in January. The invoice arrived and was recorded on December 31.3. Included in inventory is merchandise sold to Champy on December 30, f.o.b. destination. This merchandise was shipped after it was counted. The invoice was prepared and recorded as a sale on account for $12,800 on December 31. The merchandise cost $7,350, and Champy received it on January 3.4. Included in inventory was merchandise received from Dudley on December 31 with an invoice price of $15,630. The merchandise was shipped f.o.b. destination. The invoice, which has not yet arrived, has not been recorded.5. Not included in inventory is $8,540 of merchandise purchased from Glowser Industries. This merchandise was received on December 31 after the inventory had been counted. The invoice was received and recorded on December 30.6. Included in inventory was $10,438 of inventory held by Craig on consignment from Jackel Industries.7. Included in inventory is merchandise sold to Kemp f.o.b. shipping point. This merchandise was shipped after it was counted. The invoice was prepared and recorded as a sale for $18,900 on December 31. The cost of this merchandise was $10,520, and Kemp received the merchandise on January 5.8. Excluded from inventory was a carton labeled "Please accept for credit." This carton contains merchandise costing $1,500 which had been sold to a customer for $2,600. No entry had been made to the books to reflect the return, but none of the returned merchandise seemed damaged.Craig Company asks you to review its December 31, 1. Determine the proper inventory balance for Craig Company at December 31, 2014.Inventory balance as on December 31, 2014 2. Prepare any correcting entries to adjust inventory to its proper amount at December 31, 2014. Assume the books have not been closed.
Answer:
1. $237,392
2. Dr Sales Revenue $12,800
Cr Accounts Receivable $12,800
Dr Purchases (Inventory) $15,630
Cr Accounts Payable $15,630
Dr Sales Returns and Allowances $2,600
Cr Accounts Receivable $2,600
Explanation:
1. Calculation to determine the proper inventory balance for Craig Company at December 31, 2014.
December 31, 2014 Inventory balance=$234,890+$13,420+$8,540-$10,438-$10,520+$1,500
December 31, 2014 Inventory balance=$237,392
Therefore Inventory balance as on December 31, 2014 is $237,392
2. Preparation of any correcting entries to adjust inventory to its proper amount at December 31, 2014.
Dr Sales Revenue $12,800
Cr Accounts Receivable $12,800
Dr Purchases (Inventory) $15,630
Cr Accounts Payable $15,630
Dr Sales Returns and Allowances $2,600
Cr Accounts Receivable $2,600
When Get the Glare Out needed some information about the potential market for its product, the marketing team looked to the Internet to find industry trends and at the market for eyewear products, which uses the same technology that is used in its self-darkening windshield. The type of information the marketing team was using is referred to as Multiple Choice surveys. focus groups. primary data. secondary data.
Answer:
secondary data.
Explanation:
Market research can be defined as a strategic technique which typically involves the process of identifying, acquiring and analyzing informations about a business. It involves the use of product test, surveys, questionnaire, focus groups, interviews, etc.
Secondary market research can be defined as a method designed to determine the demographics of a particular target market.
A secondary data can be defined as any form of data that has been obtained or collected earlier by someone else through primary sources for their own purpose and made readily available for other researchers to use. Thus, a secondary data is a type of data that has been previously obtained or collected.
In this scenario, the type of information the marketing team was using is referred to as secondary data because it looked to the Internet to find industry trends and at the market for eyewear products, which uses the same technology that is used in manufacturing its self-darkening windshield.
In conclusion, a secondary data is typically reliant or based on the primary source of information and as such it isn't a first hand experience.
At December 31, 2020, Suffolk Corporation had an estimated warranty liability of $105,000 for accounting purposes and $0 for tax purposes. (The warranty costs are not deductible until paid.) The effective tax rate is 20%. Compute the amount Suffolk should report as a deferred tax asset at December 31, 2020.
Answer:
Deferred tax asset = $21000
Explanation:
Given the warranty liability = $105000
Effective tax rate = 20%
The deferred tax asset can be calculated by calculating the effective tax from the warranty liability. Therefore, just multiply the effective tax rate to the warranty liability.
Deferred tax asset = Effective tax rate x Warranty liability
Deferred tax asset = 20% x $105000
Deferred tax asset = $21000
Baskin's pretax accounting income in Year 2 is $100,000. Baskin received cash rental payments in advance for $20,000 in Year 1 and $30,000 in Year 2, which are taxed in the year of receipt. It is expected the rent will be recognized for financial reporting purposes as $25,000 in Year 3 and $25,000 in Year 4. The income tax rate is 40%. What is Baskin's tax basis for rental revenues in Year 2
Answer:
the baskin tax basis for rental revenue is $10,000
Explanation:
The computation of the baskin tax basis for rental revenue is given below:
= Year 4 rent recognized × income tax rate
= $25,000 × 40%
= $10,000
Hence, the baskin tax basis for rental revenue is $10,000
The same should be considered and relevant
The standard amount of materials required to make one unit of Product Q is 4 pounds. Tusa's static budget showed a planned production of 6,200 units. During the period, the company actually produced 6,300 units of product. The actual amount of materials used averaged 3.9 pounds per unit. The standard price of material is $2 per pound. Based on this information, the materials usage variance was:\
Answer: $1,260 Favorable
Explanation:
Material usage variance = (Standard quantity of materials actually produced - Actual quantity of materials actually produced) * Standard price of material
= [ ( 4 * 6,300 ) - (3.9 * 6,300) ] * 2
= [ 25,200 - 24,570 ] * 2
= 630 * 2
= $1,260 Favorable
Nick’s Novelties, Inc., is considering the purchase of new electronic games to place in its amusement houses. The games would cost a total of $475,000, have a fifteen-year useful life, and have a total salvage value of $47,500. The company estimates that annual revenues and expenses associated with the games would be as follows: Revenues $ 240,000 Less operating expenses: Commissions to amusement houses $ 70,000 Insurance 45,000 Depreciation 28,500 Maintenance 30,000 173,500 Net operating income $ 66,500 Required: 1a. Compute the payback period associated with the new electronic games. 1b. Assume that Nick’s Novelties, Inc., will not purchase new games unless they provide a payback period of five years or less. Would the company purchase the new games?
Answer:
a. 5 years
b. Yes they will because the payback period is 5 years.
Explanation:
a. Payback period
First calculate the annual cash inflow:
= Net income + Depreciation
= 66,500 + 28,500
= $95,000
The investment cost was $475,000
Payback period = Investment cost / Annual cash inflow
= 475,000 / 95,000
= 5 years
b. The company will purchase the games because they have a payback period of 5 years.
The short-run elasticity of demand for gasoline sold at gasoline stations is 0.20. If terrorism causes the supply of gasoline to fall, resulting in a 5 percent drop in quantity, if other things remain the same, the price per gallon will increase by:___________
Answer:
25%
Explanation:
Price elasticity of supply measures the responsiveness of quantity supplied to changes in price of the good.
Price elasticity of supply = percentage change in quantity supplied / percentage change in price
0.2 =5% / percentage change in price
percentage change in price = 5/0.2 = 25%
If the absolute value of price elasticity is greater than one, it means supply is elastic. Elastic supply means that quantity supplied is sensitive to price changes.
Supply is inelastic if a small change in price has little or no effect on quantity supplied. The absolute value of elasticity would be less than one
Supply is unit elastic if a small change in price has an equal and proportionate effect on quantity supplied.
A cash register tape shows cash sales of $3180 and sales taxes of $210. The journal entry to record this information is
Answer:
Debit cash $3,390
Credit sales revenue $210
Cales tax payable $3,180
Explanation:
Preparation of the journal entry to record the information given.
Journal entry
Debit cash $3,390
($3,180+$210)
Credit sales revenue $210
Cales tax payable $3,180
A corporation sold 11,000 shares of its $10 par value common stock at a cash price of $14 per share. The entry to record this transaction would include:___________
Answer:
A credit to Common Stock for $110,000. A further explanation is provided below.
Explanation:
Given:
Corporation sold,
= 11,000
Common stock per value,
= $10
Cash price,
= $14 per share
The entry record would include,
= [tex]Sold \ corporation\times Common \ stock[/tex]
= [tex]11000\times 10[/tex]
= [tex]110,000[/tex] ($)
The following general ledger accounts and additional information are taken from the records of Wolfe Corporation at the end of its fiscal year, December 31, 2019 Additional information:
a. The prepaid insurance is for a one-year policy, effective July 1, 2019.
b. A physical count indicated that $500 of supplies is still on hand.
c. $50 of December rent expense has not been recorded.
101 Unused Supplies 173 Advertising Exp. 610 Bal 700 Bal. 200 Cash Bal 2,700 Accounts Receivable110 Bal. 2,000 Common Stock Bal 320 3,800 Salaries Expense 656 Bal. 4,500 161 654 Prepaid Insurance Bal. 1,200 Repair Revenue Bal 450 7,750 Rent Expense Bal. 250
Required:
1. Record all necessary adjusting entries in general journal format including general ledger account numbers. Assume the following account numbers: Insurance Expense: 631; Supplies Expense: 668.
2. Post the adjusting entries to T-accounts and calculate balances.
3. Prepare all closing entries in general Journal format. Include general ledger account numbers.
4. Post the closing entries to the applicable general ledger accounts.
Answer:
a. Prepaid insurance (Dr.) $600
cash (Cr.) $600
b. Supplies expense (Dr.) $200
Unused supplies (Cr.) $200
c. Rent expense (Dr.) $50
Cash (Cr.) $50
Explanation:
Insurance expense : $1,200 * 6 / 12 = $600.
Cash balance $2,700 - $600 - $50 = $2,050
4. You want to take out a fully-amortizing 30-year mortgage. You can afford monthly payments of $600 each. The interest rate is 9%. How much money can you borrow?
Answer: $74569
Explanation:
Based on the information given in the question, the amount that can be borrowed is explained below:
Present value of annuity will e calculated as:
= 600 × [1-(1+0.09/12)^-(12 ×30)] / (0.09/12)
= 600 × [1-(1+0.0075)^-(360)] / 0.0075
= 600 × 1-(1.0075)^-(360)] / 0.0075
= 600 × [1-0.0678860074] / 0.0075
= 600 × 124.282
= 74569
The amount that can be borrowed is $74569
Harry has worked as a general manager at Gringard, a supply chain management firm, for eleven years of his professional life. Gringard is a company that still follows a traditional business model and has not significantly changed its human resource management and talent development processes. Harry is now joining Alivron Inc., a company that focuses on a customer-driven supply chain approach. Which of the following is a change Harry should expect to find in his new company?
a. He should expect Alivron to emphasize strong operational skills rather than cross-functional collaboration skills.
b. He wil most likely need to move from following an agile approach to an analytical approach.
c. He will most likely need to work variable shifts so that he can connect with all his team members.
d. He should expect Alivron's distribution centers to run only two shifts Monday through Friday.
Answer:
C. He will most likely need to work variable shifts so that he can connect with all his team members.
Explanation:
He will most likely need to work variable shifts so that he can connect with all his team members.
In his new company, he will most likely need to work variable shifts so that he can connect with all his team members.
Variable shifts is called rotating shifts because it is different from the conventional workdays.
The Variable shifts are programmed to schedule the employees to cover 24 hour a day, 7 days per week operations.
Hence, In the new company, he will most likely need to work variable shifts so that he can connect with all his team members.
Therefore, the Option C is correct.
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describe five ways in which contract management might adds value after the contract award stage of the sourcing process.
Answer:
The five ways for contract management are:
1 - how buyer and supplier work after contract has been awarded.
2 - Key decisions made.
3 - Risk of misunderstanding and disagreement.
4 - Identify opportunities and improve performance.
5 - Performance evaluation against KPIs.
Explanation:
Contract management is essential for any business to succeed. There are five ways in which contract management will add value after contract award stage. Usually value addition is achieved by the response of buyer and seller towards the services after the contract has been awarded. There should be right individuals involved in decision making process. The performance should be evaluated against the KPI mentioned in the contract. If both supplier and buyer work with mutual understanding there is very less chance for disagreement and value will be added to the contract performance.
A company has the following selected account balances: Sales $ 250,000 Sales Discounts 1,500 Sales Returns and Allowances 2,300 Sales Salaries Expense 56,000 Store Supplies Expense 15,000 Advertising Expense 8,000 Cost of Goods Sold 125,000 What is the gross profit that would appear on a multiple-step income statement:
Answer:
$121,200
Explanation:
The gross profit that would appear on a multiple-step income statement can be determined as :
Gross Profit = Net Sales - Cost of Sales
where,
Net Sales = Sales - Sales Discounts - Sales Returns and Allowances
= $ 250,000 - $1,500 - $2,300
= $246,200
therefore,
Gross Profit = $246,200 - $125,000
= $121,200
Leelanau applies overhead using a predetermined rate. What amount of overhead was applied to work in process last year
Answer:
$138,500
Explanation:
The computation of the overhead applied is shown below:
As we know that
Cost of goods manufactured = Beginning WIP + Total manufacturing costs - Ending WIP
$323,000 = $10,500 + Total manufacturing costs - $19,000
So,
Total manufacturing costs is
= ($323,000 + $19,000 - $10,500)
= $331,500
Now
Total manufacturing costs is
= Direct materials + Direct labor + Overheads
So,
Overheads is
= ($331,500 - $115,000 - $78,000)
= $138,500
Other things equal, diversification is most effective when Group of answer choices Securities returns are uncorrelated. Securities' returns are high. Both securities' returns are positively correlated and securities' returns are high. Securities' returns are positively correlated. You hold equal proportions of each security in a portfolio.
Answer:
Securities returns are uncorrelated.
Explanation:
Portfolio diversification is the process of holding different asset and security classes in order to minimise the non systemic risk of the portfolio
Non systemic risk are risks that can be diversified away. they are also called company specific risk. Examples of this type of risk is a manager engaging in fraudulent activities.
Correlation is a statistical measure used to measure the relationship that exists between two variables.
1. Positive correlation : it mean that the two variables move in the same direction. If one variable increases, the other variable also increases.
For example, there should be a positive correlation between quantity supplied and price
When there is a positive correlation, the graph of the variables is upward sloping
2. Negative correlation : it mean that the two variables move in different direction. If one variable increases, the other variable decreases.
For example, there should be a negative correlation between quantity demanded and price
When there is a negative correlation, the graph of the variables is downward sloping
3. Zero correlation : there is no relationship between the variables
In order to achieve the highest benefit of diversification, there should be no relationship between the assets in the portfolio
] Widget manufacturing Company began operations on January 1. All sales are on credit. Widget has sales budgeted as $160,000 for January and $290,000 for February. Accounts Receivable collections are expected to be 60% in the month of sale, 30% the next month, and 10% in the third month. Use this information to determine the dollar value of February Expected Cash Collections from Customers. Enter as a whole number (no cents). g
Answer: $222000
Explanation:
The dollar value of February Expected cash collections from customers will be calculated as the addition of the January credit sales collection and the February credit sales collection and this will be:
= ($160,000 × 30%) + ($290000 × 60%)
= $48000 + $174000
= $222000
The value of February expected cash collections from customers is $222,000.
In June 2007 General Motors (GM) posted a price-earnings ratio of 9.84. If
the price of the stock at that time was $36 per share, which of the following
must have been true?
a. GMâs earnings per share was 3.66.
b. GMâs coupon payment was $35 per year.
c. GMâs dividend yield for the year was 26%.
d. GMâs revenues that month were $366 million.
Answer:
General Motors (GM)
If the price of the stock at that time was $36 per share, the true statement is:
a. GM's earnings per share was 3.66.
Explanation:
a) Data and Calculations:
Price-earnings ratio = 9.84
Market price of stock at that time = $36 per share
Earnings per share = Market price per share/Price-earnings ratio
= $36/9.84 = 3.659
= $3.66
Check:
Price-earnings ratio = Market price per share/Earnings per share
= 9.84 ($36/$3.66)
Describe about comparative cost and absolute advantages of international trade
Answer:
Here's what I know.
Explanation:
Comparative cost talks about the difference or similarities in cost between two or more prices of good or services.
The advantages of international trade are...
1. It creates harmony between countries.
2. It encourages countries to manufacture their own products.
3. It is a source or income/revenue to the producing countries.
4. It is a good employment opportunity.
5. It improves a country's standard of living.
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Tri Fecta, a partnership, had revenues of $364,000 in its first year of operations. The partnership has not collected on $46,700 of its sales and still owes $38,000 on $175,000 of merchandise it purchased. There was no inventory on hand at the end of the year. The partnership paid $33,100 in salaries. The partners invested $48,000 in the business and $27,000 was borrowed on a five-year note. The partnership paid $2,430 in interest that was the amount owed for the year and paid $8,900 for a two-year insurance policy on the first day of business. Ignore income taxes.Compute the net income for the first year for Tri Fecta
A. $189,000
B. $155,900
C.$149,020
D.$233,430
Answer:
C
Explanation:
Part E14 is used by M Corporation to make one of its products. A total of 19,000 units of this part are produced and used every year. The company's Accounting Department reports the following costs of producing the part at this level of activity: Per Unit Direct materials $ 4.10 Direct labor $ 8.70 Variable manufacturing overhead $ 9.20 Supervisor's salary $ 4.60 Depreciation of special equipment $ 3.00 Allocated general overhead $ 8.20 An outside supplier has offered to make the part and sell it to the company for $29.50 each. If this offer is accepted, the supervisor's salary and all of the variable costs, including the direct labor, can be avoided. The special equipment used to make the part was purchased many years ago and has no salvage value or other use. The allocated general overhead represents fixed costs of the entire company, none of which would be avoided if the part were purchased instead of produced internally. In addition, the space used to make part E14 could be used to make more of one of the company's other products, generating an additional segment margin of $31,000 per year for that product. The annual financial advantage (disadvantage) for the company as a result of buying part E14 from the outside supplier should be:
Answer: ($24100)
Explanation:
The annual financial advantage (disadvantage) for the company goes thus:
The relevant cost to produce will be:
= ($4.10 × 19,000) + ($8.70 × 19,000) + ($9.20 × 19,000) + ($4.60 × 19,000) + $31,000
= $77900 + $165300 + $174800 + $87400 + $31000
= $536,400
The relevant costs to buy will be:
= 19,000 × $29.5
= $560,500
Since the relevant cost to buy is more than the relevant cost to produce, then the financial disadvantage will be:
= $560500 - $536,400
= $24,100
The answer is ($24,100)
the common sources of secondary data in tourism research are
Explanation:
Secondary data sources, such as industry statistics, surveys/censuses, and big data indicators, cover a wide array of topics that can be leveraged in tourism research..
pls Mark brainliest if it was helpfull
Hammond Lumber has just changed from prefabricating 8 gazebos to 10 gazebos (units). Their total costs changed from $9,500 to $11,000. What is the marginal cost for Hammond Lumber?
Answer:
MC = 750
Explanation:
Below is the given values:
Initial quantity = 8
Final quantity = 10
Initial total cost = $9500
Final total cost = $11000
Marginal cost = Change in total cost / Change in quantity
Change in total cost = 11000 - 9500 = 1500
Change in quantity = 10 - 8 = 2
Marginal cost = Change in total cost / Change in quantity
MC = 1500 / 2
MC = 750
Waupaca Company establishes a $350 petty cash fund on September 9. On September 30, the fund shows $104 in cash along with receipts for the following expenditures: printing expenses, $40; postage expenses, $123; and miscellaneous expenses, $80. The petty cashier could not account for a $3 shortage in the fund.
Prepare:
(1) the September 9 entry to establish the fund,
(2) the September 30 entry to reimburse the fund, and
(3) an October 1 entry to increase the fund to $400.
Answer: Please see explanation for answers
Explanation:
Journal to record establishment of fund
Date Account titles and explanation Debit Credit
Sept 9 Petty cash $350
To Cash $350
Journal to record the reimbursement of petty cash fund
Date Account titles and explanation Debit Credit
September 30 printing expenses $40
Postage expense $123
Miscellaneous expenses $80
Cash shortage - not accounted for $3
To Cash $246
Journal to show the increment of fund to $400
Date Account titles and explanation Debit Credit
October 1 Petty cash $50
To Cash $50
Calculation : ($400 - $350)=$50
Louisville, Kentucky is debating a new business ordinance that will address sidewalks in its city. Members of the Louisville city council do not need to concern themselves with which of the following issues?
a. Environmental standards
b. Federally mandated restrictive covenants
c. Local taxes
d. Local zoning
e. Building codes
Answer: c. Local taxes
Explanation:
The city will have to take into account the relevant environmental standards when constructing the sidewalks. They will also have to factor in federally restrictive mandated covenants for legality.
Local zoning laws will also need to be taken into account so that the sidewalk is not built where it is not meant to be and building codes would be important as well. They however, do not need to be concerned about local taxes because the city will not charge itself tax for city maintenance work.
The council members do not need to be concerned about the local taxes.
Local taxes are the levies that are paid by the people living in the community to the local government.In this case, the issue is about Louisville, Kentucky addressing its sidewalks in the city, therefore the local taxes won't be an issue since it's not a local issue.The source of concern will be the environmental standards, Federally mandated restrictive covenants, local zoning and building codes.
Therefore, the correct option is C.
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If the amount of beachfront land in Malibu supplied to the market remains the same even when the price of beachfront land in Malibu increases, the:_________.
a. demand for beachfront land in malibu must be perfectly inelastic,
b. supply of beachfront land in Malibu must be perfectly elastic.
c. demand for beachfront land in Malibu must be perfectly elastic.
d. supply of beachfront land in Malibu must be perfectly inelastic.
Answer:
D
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
Price elasticity of demand = percentage change in quantity demanded / percentage change in price
Infinitely elastic demand is perfectly elastic demand. Demand falls to zero when price increases
Perfectly inelastic demand is demand where there is no change in the quantity demanded regardless of changes in price.
Supply is perfectly inelastic if a small change in price has no effect on quantity supplied
Marcelino Co.'s March 31 inventory of raw materials is $80,000. Raw materials purchases in April are $500,000, and factory payroll cost in April is $363,000. Overhead costs incurred in April are indirect materials, $50,000; Indirect labor, $23,000; factory rent $32,000; factory utilities, $19,000; and factory equipment depreciation, $51,000. The predetermined overhead rate is 50% of direct labor cost. Job 306 is sold for $635,000 cahs in April.
Costs of the three jobs worked on in April follow:
Job 307 Job 307 Job 308
Balances on March 31
Direct materials $29,000 $35,000
Direct labor 20,000 18,000
Applied overhead 10,000 9,000
Costs during April
Direct materials 135,000 220,000 $100,000
Direct labor 85,000 150,000 105,000
Applied overhead
Status on April 30 Finished (sold) Finished (unsold) In process
a. Materials purchases on credit
b. Direct materials used in production
c. Direct labor paid and assigned to Factory Overhead
d. Indirect labor paid and assigned to Factory Overhead
e. Overhead costs applied to Work In Process Inventory
f. Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash)
g. Transfer of Jobs 306 and 307 to Finished Goods Inventory
h. Cost of goods sold for Job 306
i. Revenue from the sale of Job 306
j. Assignment of any underapplied or overapplied overhead to the Cost of Goods Sold account, (the amount is not material).
Required:
Prepare journal entries for the month of April to record the above transactions.
Answer:
Marcelino Co.
Journal Entries:
Debit Raw materials $500,000
Credit Accounts Payable $500,000
To record the purchase of raw materials on credit.
Debit Factory payroll $363,000
Credit Cash $363,000
To record payment for factory payroll.
Debit Work in Process:
Job 307 $135,000
Job 307 $220,000
Job 308 $100,000
Credit Raw materials $455,000
To record direct materials used in production
Debit Work in Process:
Job 307 $42,500
Job 307 $75,000
Job 308 $52,500
Credit Factory overhead $170,000
To record overhead applied.
Debit Factory overhead $175,000
Credit Raw materials $50,000
Factory payroll $23,000
Factory rent $32,000
Factory utilities $19,000
Factory equipment depreciation $51,000
To record actual factory overhead costs.
Debit Finished Goods Inventory $828,500
Credit Work in Process:
Job 306 $321,500
Job 307 $507,000
To record the cost of finished goods transferred.
Debit Cost of goods sold $321,500
Credit Finished goods inventory $321,500
To record the cost of goods sold.
Debit Cash $635,000
Credit Sales Revenue $635,000
To record the receipt of cash for sales.
Debit Cost of Goods Sold $5,000
Credit Factory overhead $5,000
To record underapplied overhead.
Explanation:
a) Data and Calculations:
Raw materials inventory, March 31 = $80,000
Raw materials $500,000 Accounts Payable $500,000
Factory payroll $363,000 Cash $363,000
Overhead costs incurred in April :
Indirect materials $50,000 Raw materials $50,000
Indirect labor $23,000 Factory payroll $23,000
Factory rent $32,000 Cash $32,000
Factory utilities $19,000 Cash $19,000
Factory equipment depreciation $51,000 Accumulated depreciation $51,000
Total overhead incurred = $175,000
Predetermined overhead rate = 50% of direct labor cost
Sale of Job 306 for cash = $635,000
Job 306 Job 307 Job 308 Total
Balances on March 31
Direct materials $29,000 $35,000 $64,000
Direct labor 20,000 18,000 38,000
Applied overhead 10,000 9,000 19,000
Costs during April
Direct materials 135,000 220,000 $100,000 $455,000
Direct labor 85,000 150,000 105,000 340,000
Applied overhead 42,500 75,000 52,500 170,000
Total costs $321,500 $507,000 $257,500 $1,086,000
Status on April 30 Finished (sold) Finished (unsold) In process
Assume you deposit $5,000 at the end of each year into an account paying 9.5 percent interest. a. How much money will you have in the account in 19 years
Answer: $242,567.27
Explanation:
The $5,000 is an annuity as it is being paid every year and is a constant amount.
The value in 19 years is the future value of this annuity:
Future value of annuity = Annuity * ( ( 1 + rate) ^ number of years - 1) / rate
= 5,000 * ( ( 1 + 9.5%)¹⁹ - 1) / 9.5%
= $242,567.27
In preparing a company's statement of cash flows for the most recent year using the indirect method, the following information is available:
Net income for the year was $58,000
Accounts payable increased by $18,600
Accounts receivable decreased by $25,600
Inventories increased by $6,200
Depreciation expense was $31,800
Net cash provided by operating activities was:_________.
Answer:
Net cash provided by operating activities was $127,800.
Explanation:
Net cash provided by operating activities can be calculated as follows:
Net cash provided by operating activities = Net income for the year + Increase in accounts payable + Decrease in accounts receivable - Increase in inventories increased + Depreciation expense = $58,000 + $18,600 + $25,600 - $6,200 + $31,800 = $127,800
Therefore, net cash provided by operating activities was $127,800.
