Answer:
Break-even point in units= 10,375
Explanation:
Giving the following information:
Selling price= $25
Fixed cost= $64,000
Break-even point in units= 8,000
First, we need to determine the unitary contribution margin:
Break-even point in units= fixed costs/ contribution margin per unit
8,000 = 64,000 / contribution margin per unit
contribution margin per unit8,000= 64,000
contribution margin per unit= 64,000 / 8,000
contribution margin per unit= $8
Now, the number of units to be sold to make a profit of $19,000:
Break-even point in units= (fixed costs + desired profit) / contribution margin per unit
Break-even point in units= (64,000 + 19,000) / 8
Break-even point in units= 10,375
Scarcity, opportunity cost, and marginal analysis Alex is training for a triathlon, a timed race that combines swimming, biking, and running. Consider the following sentence: Because his pool sessions are helping him swim more quickly, Alex plans to reduce by 1 hour per week the time he spends training on the bike and increase by 1 hour the time he spends in the swimming pool; however, his wife says that he should stop doing any biking and running and spend all 20 hours per week in the pool. Which basic principle of individual choice does Alex's plan illustrate that his wife's advice does not?
a. All costs are opportunity costs.
b. People usually exploit opportunities to make themselves better off.
c. Resources are scarce.
d. Many decisions are made on the margin.
Answer:
D
Explanation:
Marginal decisions involves considering the cost and benefit of taking a particular action. If the marginal benefit of taking a particular action exceeds the marginal cost, the activity should be undertaken
Công ty M sản xuất một số mặt hàng
thuộc đối tượng nộp thuế GTGT theo phương pháp khấu trừ thuế, tổ chức kế toán
hàng tồn kho theo phương pháp kê khai thường xuyên. Trong tháng 1, phòng kế
toán có tài liệu liên quan đến các khoản thuế và các khoản phải nộp ngân sách
như sau:
I. Số dư đầu tháng 3: TK 333:
2.000.000đ trong đó chi tiết TK 33311: 2.000.000đ.
II. Phát sinh trong tháng:
1.
Công ty đã chi tiền mặt nộp thuế môn bài năm nay theo thông báo:
3.000.000đ.
2.
Nhận được thông báo nộp thuế tài nguyên trong kỳ: 2.000.000đ.
3.
Chi phí tiền lương trong kỳ:
- Bộ phận bán hàng: 55000.000đ
- Bộ phận quản lý doanh nghiệp:
60.000.000đ
Đến kỳ thanh toán lương, công ty tiến
hành trích các khoản theo lương và thực hiện khấu trừ lương của công nhân viên theo
quy định.
4.
Mua một xe con sử dụng phải đóng lệ phí trước bạ: 6.000.000đ.
5.
Nhận thông báo tạm nộp thuế TNDN quý I năm nay: 10.000.000đ.
6.
Tổng hợp tình hình tiêu thụ sản phẩm trong tháng: giá bán sản phẩm chưa
thuế 100.000.000đ, thuế GTGT 10%, trong đó chưa thu tiền khách hàng 50% giá
thanh toán, thu bằng TGNH 30% và bằng tiền mặt 20%.
7.
Nhận lại một số sản phẩm đã tiêu thụ tháng 2, nhập kho theo giá vốn
800.000đ, giá bán hàng trả lại 1.100.000đ (gồm thuế GTGT 100.000đ) trừ vào số
tiền khách hàng còn nợ.
8.
(Giả sử) cuối tháng lập tờ khai thuế GTGT, số tiền thuế GTGT đầu vào
được khấu trừ tháng này là 12.000.000đ.
9.
Chuyển TGNH nộp thuế GTGT 2.000.000đ, thuế TTĐB 22.500.000đ, thuế TNDN
tạm nộp, nộp hộ thuế TNCN cho CNV, đã nhận được giấy báo Nợ của NH.
Yêu cầu: Trình bày bút toán ghi sổ.
Answer:
vfnfhtjjhyhhhshahayyahauahaua
Do you think that MTV’s future lies mostly in its international operations? Explain your
The demand rate for raw material A is normally distributed with an average of 300 pints per day. The standard deviation of daily demand is 15 pints. If the lead time for this material is 4 days, what is the standard deviation of demand during the 4-day lead time
Answer:
the standard deviation of demand during the 4-day lead time is 30
Explanation:
the computation of the standard deviation of demand during the 4-day lead time is given below;
= Sqrt(Lead time) × Std deviation daily demand
= Sqrt(4) × 15
=2 × 15
= 30
Hence, the standard deviation of demand during the 4-day lead time is 30
Mabbe Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A is 800 units and of Product B is 600 units. There are three activity cost pools, with estimated costs and expected activity as follows:
Activity Cost Pools Estimated Overhead Cost Expected Activity
Product A Product B Product C
Activity 1 $17460 600 600 1200
Activity 2 $19987 1700 600 2300
Activity 3 $29884 400 120 520
The activity rate for Activity 2 is closest to: __________
a. $29.274
b. $33.311
c. $11.764
d. $8.69
Answer:
d. $8.69
Explanation:
Activity rate for Activity 2 = Estimated Overhead Cost / Expected Activity
Activity rate for Activity 2 = $19,987.00 / 2300
Activity rate for Activity 2 = $8.69 per activity
Young Corporation is considering purchasing equipment that costs $80,000 and is expected to provide the following cash inflows over its five-year useful life: Year Cash inflow 1 $ 18,000 2 22,000 3 24,000 4 16,000 5 9,000 What is the payback period of this investment project
Answer:
It will take 4 years to cover the initial investment.
Explanation:
Giving the following information:
Initial investment= $80,000
Cash flows:
1 $ 18,000
2 22,000
3 24,000
4 16,000
5 9,000
The payback period is the time required to cover the initial investment:
Year 1= 18,000 - 80,000= -62,000
Year 2= 22,000 - 62,000= -40,000
Year 3= 24,000 - 40,000= -16,000
Year 4= 16,000 - 16,000= 0
It will take 4 years to cover the initial investment.
Five individuals organized Miami Music Corporation on January 1. At the end of January 31, the following monthly financial data are available:
Total Revenues…………………………....... $131,000
Operating Expenses………………………… 90,500
Cash…………………………………………...........30,800
Accounts Receivable……………………… .25,300
Supplies……………………………………..........40,700
Accounts Payable…………………………... 25,700
Common Stock………………………………...30,600
Required:
a. Did Miami Music Corporation generate a profit? Which financial statement indicates this?
c. Does Miami Music Corporation have sufficient resources to pay its liabilities? Which financial statement indicates this?
Answer:
a. Profit(loss) = Total revenue - Total expenses
= 131,000 - 90,500
= $41,000
The company did in fact generate profit of $41,000 and this can be shown from the Income Statement which is where profit or loss is calculated.
b. A company uses its assets to pay off its liabilities so if the liabilities are less than the assets then the company is capable of paying off its liabilities:
Assets = Cash + Accounts Receivable + Supplies
= 30,800 + 25,300 + 40,700
= $96,800
Liabilities are just the Accounts Payable of $25,700.
Liabilities are less than Assets so Miami Music does indeed have sufficient resources to pay its liabilities.
This information comes from the Balance Sheet which is where assets and liabilities are shown.
Green Melon Electronics Company's management plans to finance its operations with bank loans that will be repaid as soon as cash is available. The company's management expects that it will take 60 days to manufacture and sell its products and 50 days to receive payment from its customers. Green Melon's CFO has told the rest of the management team that they should expect the length of the bank loans to be approximately 110 days.
Which of the following responses to the CFO's statement is most accurate?
a. The CFO is not taking into account the amount of time the company has to pay its suppliers. Generally, there is a certain length of time between the purchase of materials and labor and the payment of cash for them. The CFO can reduce the estimated length of the bank loan by this amount of time.
b. The CFO's approximation of the length of the bank loans should be accurate, because it will take 110 days for the company to manufacture, sell, and collect cash for its goods. All these things must occur for the company to be able to repay its loans from the bank.
Setting and implementing a credit policy is important for three main reasons:
1. It has a major effect on sales, it influences the amount of funds tied up in receivables, and it affects bad debt losses.
2. It has a minor effect on sales, it influences the amount of funds tied up in receivables, and it affects bad debt losses.
Answer: a. The CFO is not taking into account the amount of time the company has to pay its suppliers. Generally, there is a certain length of time between the purchase of materials and labor and the payment of cash for them. The CFO can reduce the estimated length of the bank loan by this amount of time.
1. It has a major effect on sales, it influences the amount of funds tied up in receivables, and it affects bad debt losses.
Explanation:
A. Since the company's management expects that it will take 60 days to manufacture and sell its products and 50 days to receive payment from its customers, while Green Melon's CFO informed the rest of the management team that they should expect the length of the bank loans to be approximately 110 days, then it can be inferred that the CFO is not taking into account the amount of time the company has to pay its suppliers.
2. Setting and implementing a credit policy is important because it has a major effect on sales, nfluences the amount of funds tied up in receivables, and it also affects bad debt losses.
Journalize the entries to record the following transactions for Mountain Realty Inc.:
Aug.26 Issued for cash 128,000 shares of no-par common stock The stock outstanding when a corporation has issued only one class of stock. (with a stated value of $5) at $6.
Oct.1 Issued at par value 41,000 shares of preferred 1% stock, $10 par The monetary amount printed on a stock certificate. for cash.
Nov. 30 Issued for cash 17,000 shares of preferred 1% stock, $10 par at $11
Answer and Explanation:
The journal entries are shown below"
On Aug 26
Cash Dr $768,000
To Common stock $640,000
To Additional paid in capital $128,000
(Being issuance of the common stock is recorded)
On Oct 1
Cash Dr $410,000
To preferred stock $410,000
(Being the issuance of the preferred stock is recorded)
On Nov 30
Cash Dr $187,000
To Common stock $170,000
To Additional paid in capital $17,000
(Being issuance of the common stock is recorded)
Consider a telephone call to London that currently would cost $5. If the real price of telephone calls does not change in the future, how much will it cost you to make a call to London in 50 years if the inflation rate is 5% (roughly its average over the past 30 years)? What if inflation is 10%.
Answer:
If inflation were 5%, the value of the call in 50 years would be $ 57.33; while if inflation were 10% the value of the call would be $ 586.95.
Explanation:
Given that a telephone call to London that currently would cost $ 5, to determine, if the real price of telephone calls does not change in the future, how much will it cost you to make a call to London in 50 years if the inflation rate is 5% and if inflation is 10%, the following calculations must be made:
5 x 1.05 ^ 50 = X
5 x 11.4674 = X
57.33 = X
5 x 1.1 ^ 50 = X
5 x 117.39 = X
586.95 = X
Therefore, if inflation were 5%, the value of the call in 50 years would be $ 57.33; while if inflation were 10% the value of the call would be $ 586.95.
On December 1, a six-month liability insurance policy was purchased for $900. Analyze the required adjustment as of December 31 using T accounts, and then formally enter this adjustment in the general journal.
Answer:
See below
Explanation:
Prepaid insurance. Insurance expense
————————————- ———————————-
debit. | Credit. Debit. | Credit
|. 150.00. 150. |
enter the debit of 150 under insurance expense in the journal
enter the credit of 150 under prepaid insurance in the journal
Zoey Bella Company has a payroll of $6,200 for a five-day workweek. Its employees are paid each Friday for the five-day workweek. Journalize the adjusting entry required on December 31, assuming the year ends on a Thursday.
Answer:
Debit Salaries Expense $6,200
Credit Salaries Payable $6,200
Explanation:
Preparation of the adjusting entry required on December 31, assuming the year ends on a Thursday.
Based on the information given the appropriate
adjusting journal entry required on December 31, assuming the year ends on a Thursday will be :
December 31
Debit Salaries Expense $6,200
Credit Salaries Payable $6,200
Flexible budgets Group of answer choices are static budgets that have been revised for changes in price(s). accommodate changes in activity levels. accommodate changes in the inflation rate. are used to evaluate capacity utilization.
Answer: accommodate changes in activity levels.
Explanation:
A flexible budget is refered to as the budget which changes based on the actual activity. It accommodate changes in activity levels.
It is the budget which is allowed to be adjusted as a result of the change in the assumptions that's used in the creation of the budget during the planning process of the management.
Answer:
accommodate changes in activity levels. is the correct choice.
Explanation:
Flexible budgets Group of answer accommodate changes in activity levels.
How do managers handle 2 challenges of each of the 8ms of management to effectively and efficiently steer their organization in a globally competitive environment and thus achieve the organizational goals
Answer:
16
Explanation:
i think 16 im not sure though. hope i helped:)
The Anson Jackson Court (AJC) currently has $150,000 market value (and book value) of perpetual debt outstanding carrying a coupon rate of 6%. Its earnings before interest and taxes (EBIT) are $89,000, and it is a zero growth company. AJC's current cost of equity is 10%, and its tax rate is 25%. The firm has 10,000 shares of common stock outstanding selling at a price per share of $60.00. Refer to the data for Anson Jackson Court (AJC). AJC is considering moving to a capital structure that is comprised of 25% debt and 75% equity, based on market values. The new funds would be used to replace the old debt and to repurchase stock. It is estimated that the increase in risk resulting from the additional leverage would cause the required rate of return on debt to rise to 6.56%, while the required rate of return on equity would rise to 10.07%. If this plan were carried out, what would be AJC's new WACC and total value
Answer:
The answer is "8.78%; $760,034"
Explanation:
Please find the complete solution in the attached file.
Benny is the manager of an office-support business that supplies copying, binding, and other services for local companies. He must replace a worn-out copy machine that is used for black-and-white copying. He is considering two machines, and each of these has a monthly lease cost plus a cost for each page that is copied. Machine 1 has a monthly lease cost of $619, and there is a cost of $0.030 per page copied. Machine 2 has a monthly lease cost of $675, and there is a cost of $0.028 per page copied. Customers are charged $.16 per page copied. If Benny expects to make 105,000 copies per month, what would be the monthly cost for each machine
Answer:
Machine one cost:
= Fixed cost + Variable cost
The Fixed cost is the lease cost and the variable cost is the cost per page copied. The number of pages is 105,000 and the cost per page for machine 1 is $0.030
= 619 + (0.030 * 105,000)
= $3,769 monthly
Machine two cost:
= 675 + (0.028 * 105,000)
= $3,615 monthly
we flew to ___Dublin Airport in ___ Ireland. correct determiners
Answer:
we flew to the Dublin Airport in the Ireland
Shaq Corporation issued $10,000 of 20-year bonds on January 1, 2021. The bonds pay interest semiannually. This is a partial bond amortization schedule for the bonds.
Payment Cash Effective interest Decrease in balance Outstanding balance
9,080
1 400 409 9 9,089
2 400 409 9 9,098
3 400 409 9 9,107
4 400 410 10 9,117
What is the effective annual rate of interest on the bonds?
a. 9.0%.
b. 4.5%.
c. 8.0%.
d. 4.0%.
Answer:
The correct option a. 9.0%.
Explanation:
Note: The data in this question are merged together. They are therefore sorted before answering the question. See the attached pdf file for the complete question with the sorted data.
The explanation of the answer is now given as follows:
Effective semiannual interest rate = Effective interest / Previous outstanding balance ……………………. (1)
Using Payment 1 information, we have:
Effective semiannual interest rate = 409 / 9,080 = 0.0450, or 4.50%
Effective annual interest rate = Effective semiannual interest rate * Number of semiannuals in a year = 4.50% * 2 = 9.0%
Therefore, the correct option a. 9.0%.
Which of the following organizations currently is responsible for establishing and improving standards of financial accounting and reporting for the guidance and education of the public, which includes issuers, auditors, and users of financial information?
a. The Accounting Principles Board.
b. The Committee on Accounting Procedure.
c. The Financial Accounting Standards Board
d. All of the answer choices are correct.
Answer:
C)Financial Accounting Standards Board (FASB)
Explanation:
The Financial Accounting Standards Board can be regarded as a private as well as a non-profit organization standard-setting body that is been set up primarily for establishment as well as improvement of Generally Accepted Accounting Principles in the interest of the public, it base in United States. It is set up carry out purposes such as financial accounting as well as reporting of standards for both public and private companies. It was established in year 1973. It should be noted that Financial Accounting Standards Board is a kind of organizations that is currently
responsible for establishing and improving standards of financial accounting and reporting for the guidance and education of the public, which includes issuers, auditors, and users of financial information.
A company is planning to purchase a machine that will cost $57,000 with a six-year life and no salvage value. The company expects to sell the machine's output of 3,000 units evenly throughout each year. A projected income statement for each year of the asset's life appears below. What is the payback period for this machine?
Sales $138,000
Costs:
Manufacturing $68,000
Depreciation on machine 9,500
Selling and administrative expenses 46,000 (123,500)
Income before taxes $14,500
Income tax (35%) 5,075
Net income $9,425
a. 6.00 years.
b. 1.99 year.
c. 6.05 years.
d. 12.10 years.
e. 3.01 years.
Answer:
e. 3.01 years
Explanation:
Cost of Asset = $57,000
Net annual cash Inflow = Net Income after Tax + Depreciation
Net annual cash Inflow = $9,425 + $9,500
Net annual cash Inflow = $18,925
Payback Period = Cost of Asset (Investment) / Net annual cash Inflow
Payback Period = $57,000 / $18,925
Payback Period = 3.01188904
Payback Period = 3.01 years
Steven Washington's weekly gross earnings for the week ending March 9 were $3,340, and her federal income tax withholding was $567.80. Assuming the social security tax rate is 6% and Medicare tax is 1.5% of all earnings, what is Washington's net pay?
Answer:
Washington's net pay was $ 2,564.28.
Explanation:
Given that Steven Washington's weekly gross earnings for the week ending March 9 were $ 3,340, and her federal income tax withholding was $ 567.80, assuming the social security tax rate is 6% and Medicare tax is 1.5% of all earnings, to determine what is Washington's net pay the following calculation must be performed:
(3,340 - 567.80) x (1 - 0.06 - 0.015) = X
2,772.2 x 0.925 = X
2,564.28 = X
Therefore, Washington's net pay was $ 2,564.28.
If Stephenson wishes to maximize its total market value, would you recommend that it issue debt or equity to finance the land purchase. Explain.
Answer:
The answer is issue debt finance
Explanation:
Should Stephenson wishes to maximize the total market value he should issue debt to finance the land purchase.
Why? - Because the interest payments of debt are tax deductible, A capital structure that has a debt will shrink the company’s taxable income, and will form a tax shield that will ultimately increase the total value of the company.
Summer 20 Corp estimates overhead based on direct labor hours and has given you the following information:
Estimated Manufacturing Overhead Costs 2020 $405,000
Estimated Direct Labor Hours for 2020 220,000
Actual Direct Labor Hours for 2020 202,000
Manufacturing Overhead Account Debit Entries total $380,000
1. Determine the predetermined overhead allocation rate stated with cents.
2. Determine the amount of manufacturing overhead that was allocated.
3. Calculate the amount Summer 20 Corp is over or under allocated during the year.
Answer:
Results are below.
Explanation:
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 405,000 / 220,000
Predetermined manufacturing overhead rate= $1.841 per DLH
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 1.841*202,000
Allocated MOH= $371,882
Finally, the over/under allocation:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 380,000 - 371,882
Underapplied overhead= $8,118
If the price of product L increases, then how will the demand curve for the close-substitute product J shift? If X is a normal good, will an increase in money income shift the supply or demand curve and in which direction?
Answer:
demand curve for product J would shift rightwards or outwards
If X is a normal good, an increase in income would shift the demand curve rightwards or outwards
Explanation:
Substitute goods are goods that can be used in place of another good.
If the price of product L increases, the quantity demanded of product L declines. this is line with the law of demand
According to the law of demand, the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded.
Consumers would then shift to the consumption of the close substitute. As a result, there would be an increase in the demand for product J. This would lead to a rightward or outward shift of the demand curve for product J
Normal goods are goods that are goods whose demand increases when income increases and falls when income falls
Since X is a normal good, when income increases, the demand for good X increases. this would shift the demand curve outward
Project Management Practice ProblemBragg’s Bakery is building a new automated bakery downtown Sandusky. Here are the activities that need to be completed to get the new bakery built and the equipment installed.
ACTIVITYPREDECESSORNORMAL TIME (WEEK)CRASH TIME (WEEK)EXPEDITING COST/WEEKA-963000BA853500CA15104000DB,C532000EC1062500FD,E215000
Hint: I have directly provided the crashing cost per unit time.
a. What is the normal project length?
b. What is the critical path in this project?
c. Which activity will you choose to crash first to reduce the duration of the project by one week?
d. What is the project length if all activities are crashed to their minimum?
e. What is the slack for activity D?
Answer:
a. The normal project length is 36 weeks.
b. The critical path in this project is A-C-E-F.
c. The activity that you choose to crash first to reduce the duration of the project by one week is E because it has the least expediting cost/week amongst A, C, E, F.
d. The project length if all activities are crashed to their minimum is 23 weeks.
e. The slack for activity D is 5 weeks.
Explanation:
a) The normal length of the project = completion time of last activity = 36 weeks.
b) The criteria for critical activity:
[tex]LC_{i} = ES_{i} ,\\LC_{j} = ES_{j} ,\\[/tex]
[tex]ES_j - ES_i = LF_j - LF_{i} =[/tex] duration of the activity
where ES = Earliest start time, EF = Earliest finish time , LC = latest completion time, LF = latest finish time ,
The suffix- i refers to the preceding node, suffix-j refers to the succeeding node.
activities satisfying above all criteria are A, C, E, F
therefore critical path is A-C-E-F.
c) To reduce the project duration by 1 week. we should choose to crash among critical activities A, C, E, F. thus we choose to crash activity E because it has the least expediting cost/week amongst A, C, E, F.
d) if we crash all the activities to their minimum, then the project length = sum of crash time of all critical activities
= [6 + 10 + 6 + 1]
= 23 weeks.
e) The slack of activity d = LS - ES = 34 - 29
= 5 weeks
The critical path is given in the diagram,
Austen, the night shift manager of a 24-hour convenience store, would regularly drive his car to the back door, unlock it, and load in a couple of cases of beer, every night. These cases of beer were marked down for no apparent reason, and Austen paid the reduced price. Is Austen setting a good example for his employees
Answer:
bro
Explanation:
The cost of direct materials transferred into the Rolling Department of Kraus Company is $3,000,000. The conversion cost for the period in the Rolling Department is $462,600. The total equivalent units for direct materials and conversion are 4,000 tons and 3,855 tons respectively. Determine the direct materials and conversion costs per equivalent unit.
Answer:
the direct material & conversion cost per equivalent unit is $750 per ton and $120 per ton
Explanation:
The calculation of the direct material & conversion cost per equivalent unit is given below:
Direct materials per equivalent unit is
= $3,000,000 ÷ 4,000 tons
= $750 per ton
And,
Conversion costs per equivalent unit is
= $462,600 ÷ 3,855 tons
= $120 per ton
Hence, the direct material & conversion cost per equivalent unit is $750 per ton and $120 per ton
The following information was taken from Charu Company's balance sheet: Fixed assets (net) $860,000 Long-term liabilities 200,000 Total liabilities 600,000 Total stockholders’ equity 250,000 Determine the company's (a) ratio of fixed assets to long-term liabilities and (b) ratio of liabilities to stockholders' equity. If required, round your answers to one decimal place. a. Ratio of fixed assets to long-term liabilities fill in the blank 1 b. Ratio of liabilities to stockholders' equity
Answer:
A. 4.3
B. 2.4
Explanation:
(a) Calculation to determine ratio of fixed assets to long-term liabilities
Using this formula
Ratio of fixed assets to long-term liabilities =Fixed assets (net)/Long-term liabilities
Let plug in the formula
Ratio of fixed assets to long-term liabilities= $860,000 /$200,000
Ratio of fixed assets to long-term liabilities=4.3
Therefore Ratio of fixed assets to long-term liabilities is 4.3
(b) Calculation to determine ratio of liabilities to stockholders' equity
Using this formula
Ratio of liabilities to stockholders' equity=Liabilities/Total stockholders’ equity
Let plug in the formula
Ratio of liabilities to stockholders' equity=$600,000 /$250,000
Ratio of liabilities to stockholders' equity=2.4
Therefore ratio of liabilities to stockholders' equity is 2.4
financial lit Banks offer other types of services such as safe deposit boxes for customers to store valuable documents. List at least two other types of non-account services that the provider makes available to customers, either for a fee or at no cost.
Answer and Explanation:
Banks offer agency services too such as being trustees, executors, or financial advisors to their customers. They can also stand as guarantee for their customers.
Banks also offer reference services. They provide information on the financial position or strength of their customers for the purpose of a customer's business dealing. This is usually done confidentially and with the permission of the customer
Crane Enterprises reported cost of goods sold for 2020 of $1,290,700 and retained earnings of $4,708,100 at December 31, 2020. Crane later discovered that its ending inventories at December 31, 2019 and 2020, were overstated by $116,750 and $32,910, respectively. Determine the corrected amounts for 2020 cost of goods sold and December 31, 2020, retained earnings.
Answer:
Adjusted Cost of Goods sold = $1,206,860Adjusted Retained Earnings = $4,675,190Explanation:
An overstated opening inventory would overstate Cost of Goods sold. The overstatement should therefore be removed from the Cost of goods sold.
An overstated closing inventory would understate Cost of Goods sold. The overstatement should therefore be added to the Cost of Goods sold.
Adjusted Cost of Goods sold 2020 = Cost of Goods sold + 2020 ending inventory - 2019 opening inventory
= 1,290,700 + 32,910 - 116,750
= $1,206,860
Adjusted Retained earnings
The retained earnings would have to be adjusted for the overstatement of the current inventory by $32,910 because this understated Cost of Goods sold.
= Retained earnings - Overstatement of inventory
= 4,708,100 - 32,910
= $4,675,190
