Indigo Corporation had the following tax information.
Year Taxable Income Tax Rate Taxes Paid
2015 $294,000 35% $102,900
2016 332,000 30% 99,600
2017 399,000 30% 119,700
In 2018, Indigo suffered a net operating loss of $487,000, which it elected to carry back. The 2018 enacted tax rate is 26%.
Prepare Indigo’s entry to record the effect of the loss carryback.
Account titles Debit Credit

Answers

Answer 1

Answer:

Explanation:

Given that:

Indigo Corporation had the following tax information.

Year      Taxable Income         Tax Rate               Taxes Paid

2015        $294,000                  35%                       $102,900

2016         332,000                    30%                        99,600

2017          399,000                    30%                       119,700

In 2018, Indigo suffered a net operating loss of $487,000, which it elected to carry back. The 2018 enacted tax rate is 26%.

The objective is to prepare the Indigo's entry to record the effect of the loss carryback.

The Income  Tax Refund Receivable = Taxable income(2018) × Tax rate(2018) + ( net operating loss - Taxable income(2018) )  × Tax rate(2018)

(332000 × 30%)+(476000-332000) × 30%

The Income  Tax Refund Receivable =  (332000 × 0.30)+(476000-332000) × 0.30

The Income  Tax Refund Receivable = 99600 + 144000× 0.30

The Income  Tax Refund Receivable = 99600 + 43200

The Income  Tax Refund Receivable = 142800

Therefore, Indigo Corporation ENtry can be prepared as follows:

Account titles                                        Debit          Credit

Income Tax Refund Receivable          142800

Benefit Due to Loss Carryback                             142800

To record the effect of the loss carryback


Related Questions

Sweet Acacia Industries reported net income of $1.40 million in 2022. Depreciation for the year was $224,000, accounts receivable decreased $490,000, and accounts payable decreased $392,000.


Required:

Compute net cash provided by operating activities using the indirect approach.

Answers

Answer:

Net Cash flow from operating = $ 1,722,000  

Explanation:

To determine the net cash flow from operating activities. We will adjust the net income as follows; all decrease in assets and increase in liabilities are added and all increase in assets and decrease in liabilities are subtracted.

All non- cash expenses would be added back and all non-cash income would be deducted from the net income. Notable here is depreciation a non-cash expense which must be added back to the net income

This principle is applied below:

                                                                $

Net Income                                        1,400,000

Adjustments:

Add depreciation expense                 224,000

Add decrease in current asset           490,000      

less decrease in current liabilities     (392,000)      

Net Cash flow from operating            1,722,000  

Net Cash flow from operating = $ 1,722,000  

You observe a portfolio for five years and determine that its average return is 11.3​% and the standard deviation of its returns in 19.7​%. Would a​ 30% loss next year be outside the​ 95% confidence interval for this​ portfolio?

Answers

Answer:

-28.1%

Explanation:

Calculation for what would a​ 30% loss next year be outside the​ 95% confidence interval for the​ portfolio

The standard deviation of 95% confident will be 2

The first step is to find the Upper tail using this formula

Upper tail= Average return percentage +(Standard deviation of 95% confident *Standard deviation of its returns)

Let plug in the formula

Upper tail=0.113+(2*0.197)

Upper tail =0.113+0.394

Upper tail=0.507*100

Upper tail =50.7%

Second step is to find the Lower tail using this formula

Lower tail=Average return percentage -(Standard deviation of 95% confident *Standard deviation of its returns)

Let plug in the formula

Upper tail=0.113-(2*0.197)

Upper tail =0.113-0.394

Upper tail=-0.281*100

Upper tail =28.1%

Based on the above calculation the lower tail was -28.1% which means that it wouldn't in any way loss more than the 30% of it value next year outside the​ 95% confidence interval for the portfolio

"When The Bank of Bank County borrows funds from the Federal Reserve; the rate the Fed charges the commercial bank is called the _____ rate."

Answers

Answer: Bank Rate/ Discount Rate

Explanation:

The Bank Rate is the interest rate that the Fed as the country's Central Bank charges commercial banks when they borrow money from it. The loans given are usually short term in nature.

The Bank Rate is a very useful tool in Monetary Policy by the Central Bank. If the Fed for instance would like to increase Economic activity by injecting cash into the economy, they can lower the bank rate and thus encourage more banks to loan money from them which will then be loaned to the public. If the Fed wanted to decrease Economic activity, the reverse would hold true.

On January 1, 2018, Frontier World issues $40.7 million of 9% bonds, due in 20 years, with interest payable semiannually on June 30 and December 31 each year. The proceeds will be used to build a new ride that combines a roller coaster, a water ride, a dark tunnel, and the great smell of outdoor barbeque, all in one ride. rev: 11_03_2016_QC_CS-68413 Required: 1-a. If the market rate is 8%, calculate the issue price. (FV of $1, PV of $1, FVA of $1, and PVA of $1)

Answers

Answer:

$44,728,243.62

Explanation:

face value $40,700,000

coupon rate 9%, semiannual 4.5%

maturity 20 years x 2 = 40 periods

market interest rate 8%

issue price?

present value of face value = $40,700,000 / (1 + 4%)⁴⁰ = $8,477,364.12

present value of coupon payments = $1,831,500 x 19.793 (PV annuity factor, 4%, 40 periods) = $36,250,879.50

market price = $8,477,364.12 + $36,250,879.50 = $44,728,243.62

Journal entry to record issuance of the bonds:

January 1, 2018, bonds are issued at a premium

Dr Cash 44,728,243.62

    Cr Bonds payable 40,700,000

    Cr Premium on bonds payable 4,028,243.62

How can you assist the ProServices team in serving Pro customers in your
department? Select all that apply.
A. Pull orders for Pro customers in advance and have them ready to pick-up
B. Call Pro customers to maintain relationships and proactively seek out business
C. Monitor inventory levels to make sure key Pro items are in-stock
D. Price match other retailers to give Pro the best price
E. Identify pro customers and introduce them to the ProServices team​

Answers

Answer:

ProServices Team and Pro Customers

Assisting the ProServices Team in serving Pro customers in my department.  Here I have assumed that my department manages and coordinates the relationship with Pro customers:

A. Pull orders for Pro customers in advance and have them ready to pick-up

B. Call Pro customers to maintain relationships and proactively seek out business

C. Monitor inventory levels to make sure key Pro items are in-stock

D. Price match other retailers to give Pro the best price

E. Identify pro customers and introduce them to the ProServices team​.

Explanation:

“Pro” customers are a group of independent contractors, repair remodelers, specialty tradesmen, property management, and facility maintenance professionals who are afflicted to an organization offering ProServices.  They are not the end customers.  Between my organization and the customers, they are middlemen and women who are organized by my ProServices organization to offer specialty services to the general public in a professional manner that  guarantees customer satisfaction and payment to the professionals for services rendered.  In doing this, the ProService organization charges the Pro customers a fixed fee, which is deducted from the payments made by the end-customers.

Idaho Industries Inc. is considering a project that has an initial aftertax outlay or aftertax cost of​ $450,000. The respective future cash inflows from its fiveyear project for years 1 through 5 are​ $95,000 each year. Idaho expects an additional cash flow of​ $60,000 in the fifth year. The firm uses the IRR method and has a hurdle rate of​ 10%. Will Idaho accept the​ project? A. Idaho accepts the project because it has an IRR greater than​ 10%. B. Idaho accepts the project because it has an IRR greater than​ 5%. C. Idaho rejects the project because it has an IRR less than​ 10%. D. There is not enough information to answer this question.

Answers

Answer:

c

Explanation:

Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested

IRR can be calculated using a financial calculator

Cash flow in year 0 =  $-450,000

Cash flow each year from year 1 to 4 = $95,000

Cash flow in year 5 = $95,000 + $60,000 = $155,000

IRR = 5.62%

Idaho would reject the project because the IRR is less than the hurdle rate

To find the IRR using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.  

Kate is in the 15% tax bracket and has $29,000 available for investment during her current tax year. Assume that she remains in the same tax bracket over the next 11 years, and determine the accumulated amount of her investment after taxes if she puts the$29,000 into the following. (Round your answers to the nearest cent.)(a) a tax-deferred annuity that pays 4%/year, tax deferred for 11 years$ (b) a taxable instrument that pays 4%/year for 11 years

Answers

Answer and Explanation:

The computation is shown below:

a. The Accumulated amount of her investment atter taxes is

Before that first we have to determine the future value which is shown below:

As we know that

Future value = Present value × (1 + interest rate)^number of years

= $29,000 × (1 + 0.04)^11

= $44,644.17

And, the tax rate is 15%

So, the after tax value is

= $44,644.17 × (1 - 0.15)

= $37,947.54

b. Now for the second part it is

= Annual cash flows × Annuity factor at 3.4% for 11 years

= $29,000 × 10.638

= $308,502

Geese Company utilizes the LIFO retail inventory method. Its cost-to-retail percentage is 60% based on beginning inventory and 64% based on current-period purchases. The company determined that beginning inventory at retail was $200,000 and that during the current period a new layer was added with retail value of $50,000. The cost of ending inventory should be

Answers

Answer:

$152,000

Explanation:

Calculation for the cost of the ending inventory

First step is to calculate the cost-to-retail percentage of the beginning inventory amount

Using this formula

Beginning Inventory =Cost-to-retail percentage*Beginning inventory at retail

Let plug in the formula

Beginning Inventory =60%*$200,000

Beginning Inventory =$120,000

Second step is to calculate current-period purchases percentage of the new layer amount

Using this formula

Current period purchases= Purchases percentage* New layer

Let plug in the formula

Current period purchases=64%*50,000

Current period purchases=$32,000

The last step is to find the cost of the ending inventory using this formula

Ending inventory cost=Beginning Inventory+Current period purchases

Let plug in the formula

Ending inventory cost=$120,000+$32,000

Ending inventory cost=$152,000

Therefore the cost of the ending inventory will be $152,000

frolic Corporation has budgeted sales and production over the next quarter as follows: July August September Sales in units 41,500 53,500 ? Production in units 42,550 53,800 58,150 The company has 4,300 units of product on hand at July 1. 10% of the next month's sales in units should be on hand at the end of each month. October sales are expected to be 73,000 units. Budgeted sales for September would be (in units):

Answers

Answer:

56,500 units

Explanation:

The computation of Budgeted sales for September is shown below:-

we assume the no. of units sold in September be ‘x’

Budgeted Production production for September = Budgeted sale for September + desired ending inventory for September – Beginning Inventory for September

58,150 = x units + (73,000 × 10%) - (x units of Sept. × 10%)

58,150 = x + 7,300 - 0.10x

58,150 - 7300 = 0.9x

50,850 = 0.9x

x = 50850 ÷ 0.9

x = 56,500 units

four (4) ways to harvest an investment in a business.

Answers

Answer:

Harvesting an investment in a business

Four ways to harvest:

a. Outright sale of a company or the investment

b. Issue of Initial Public Offering (IPO)

c. Gradual elimination of a product, especially after the cow stage.

d. Withdrawal of additional investment and earning of profits.

Explanation:

These strategies can be employed by a business to reap the fruits from an investment.  The purpose for the investment and the risk profile of the investor determines the actual strategy or combination of strategies used by the investor.

As the leader of your newly formed 9-person team, one of your key concerns is that the team performs as a cohesive unit. Which of the following descriptions is most likely to indicate that your team is cohesive?
A. There is very little conflict between team members.
B. Team members prioritize the team’s goals over their own goals.
C. Whenever tackling a new team task, members typically divide into the same 3 subgroups.
D. Team members have no problem working independently or alone.

Answers

Answer:

b. Team members prioritize the team’s goals over their own goals.

Explanation:

Team cohesiveness is mostly seen in teams that perform highly. People in such teams are usually more likely to cooperate and they have an effective way of achieving their set objectives.

Team cohesiveness would have members of a team acting together rather than individually. It is an interpersonal relationship that is alive within members of the group and this pushes and motivates them to participate more and do what is necessary to achieve all of their objectives.

Suppose you own 5% of Coastal Corporation's 400,000 outstanding common shares. The stock was trading for $165 per share before Coastal executives announced a 3-for-2 stock split. After the split, you will own _____ shares worth _____ per share.Group of answer choices

Answers

Answer: 30,000; $110

Explanation:

From the question, we are informed that someone own 5% of Coastal Corporation's 400,000 outstanding common shares and that the stock was trading for $165 per share before Coastal executives announced a 3-for-2 stock split.

The share owned after the split will be:

= 5% × 400,000 × (3/2)

= 0.05 × 400,000 × 1.5

= 30,000

The price after the split will be the current price divided by the split ratio. Tgis will be:

= $165/1.5

= $110

A monopolist faces a

A. a two-tiered demand curve.

B. a perfectly elastic demand curve.

C. the market demand curve.

D. a perfectly inelastic demand curve.

Answers

Answer:

C

Explanation:

Cash dividends of $45,000 were declared during the year. Cash dividends payable were $10,000 at the beginning of the year and $15,000 at the end of the year. The amount of cash for the payment of dividends during the year is

Answers

Answer:

$40,000

Explanation:

               Dividend Payable

Opening Dividend                        $10,000

Add: Dividend Liability made      $45,000

after Dividend declared  

Less: Closing Dividend                $15,000

Dividend to pay in Current year $40,000

The_________for a soft drink manufacturer would include other manufacturers of soft drinks, fruit juices, bottled water, sports drinks, caffeine-free colas, and dairy beverages.

a. competitive environment
b. technological environment
c. cooperative environment
d. economic environment

Answers

Answer:

The answer is A

Explanation:

Competitive environment is an environment where competitors compete with one another for customers.

For example, Westpac, NAB, Commonwealth Bank and ANZ are in the same competitive environment. These are banks in Australia.

Types of competition are perfect competition, monopoly, monopolistic competition, oligopoly etc.

Jensen performed legal services to assist Balm Co. in accomplishing its initial organization. Jensen accepted 1,000 shares of $5 par common stock in Balm as payment for his services. The Balm shares were not yet publicly traded, but they had a book value of $4 per share. Jensen provided 48 hours of service, which is normally billed at $125 per hour. By what amount should the common stock account increase?

Answers

Answer: $5,000

Explanation:

The Common Stock account of a company will record stock only at the Par Value so that the Balance sheet is more accurate.

As such, the common stock account here will increase by;

= 1,000 * $5 par value

= $5,000

As the workforce becomes more diverse, why does performance appraisal become a more difficult process?

Answers

Answer: The diversification of the employees in the organization will bring about a larger difference between the workers and raters and could invariably lead to bias at the workplace.

Explanation:

Performance appraisal is also called performance evaluation and it is when the performance of a worker in a company is being appraised or evaluated so as to improve efficiency and output.

The diversification of the employees in the organization will bring about a larger difference between the employees and the raters who are rating them. Hence, the above situation can lead to biases and unfairness in the workplace.

If the economy is normal, Charleston Freight stock is expected to return 16.5 percent. If the economy falls into a recession, the stock's return is projected at a negative 11.6 percent. The probability of a normal economy is 70 percent while the probability of a recession is 30 percent. What is the variance of the returns on this stock

Answers

Answer:

Variance of the returns of this stock is  0.01658177

Explanation:

Mean return = 0.7 * 16.5% + 0.3*-11.6%

Mean return =  0.1155 - 0.0348

Mean return = 0.0807

Mean return = 8.07%

Variance of the return = 0.7 * (16.5%-8.07%)^2 + 0.3 * (-11.6%-8.07%)^2

Variance of the return = 0.7 * (8.43%)^2 + 0.3 * (-19.67%)^2

Variance of the return = 0.7 * (0.0843)^2 + 0.3 * (-0.1967)^2

Variance of the return = 0.0049745 + 0.011607267

Variance of the return = 0.01658177

Caribou Gold Mining Corporation is expected to pay a dividend of $6 in the upcoming year. Dividends are expected to decline at the rate of 3% per year. The risk-free rate of return is 5%, and the expected return on the market portfolio is 13%. The stock of Caribou Gold Mining Corporation has a beta of .5. Using the constant-growth DDM, the value of the stock is _________. A. $150 B. $50 C. $100 D. $200

Answers

The question is incomplete. Here is the complete question.

Caribou Gold Mining Corporation is expected to pay a dividend of $6 in the upcoming year. Dividends are expected to decline at the rate of 3% per year. The risk-free rate of return is 5%, and the expected return on the market portfolio is 13%. The stock of Caribou Gold Mining Corporation has a beta of .5. Using the constant-growth DDM, the intrinsic value of the stock is _________. A. $150 B. $50 C. $100 D. $200

Answer:

$50

Explanation:

Caribou Gold mining corporation is expected to make a dividend payment of $6 next year

Dividend are expected to decline at a rate of 3%

= 3/100

= 0.03

The risk free rate of return is 5%

= 5/100

= 0.05

The expected return on the market portfolio is 13%

= 13/100

= 0.13

The beta is 0.5

The first step is to calculate the expected rate of return

= 0.05+0.5(0.13-0.05)

= 0.05+0.5(0.08)

= 0.05+0.04

= 0.09

Therefore, the intrinsic value of the stock using the constant growth DDM model can be calculated as follows

Vo= 6/(0.09+0.03)

Vo= 6/0.12

Vo= $50

Hence the intrinsic value of the stock is $50

On January​ 2, 2019, Konrad Corporation acquired equipment for . The estimated life of the equipment is 5 years or hours. The estimated residual value is . If Konrad Corporation uses the units of production method of​ depreciation, what will be the debit to Depreciation Expense for the year ended December​ 31, 2020, assuming that during this​ period, the asset was used ​hours?

Answers

The question is incomplete. The complete question is,

On January 2, 2019, Konrad Corporation acquired equipment for $500,000. The estimated life of the equipment is 5 years or 18,000 hours. The estimated residual value is $14,000. If Konrad Corporation uses the units of production method of depreciation, what will be the debit to Depreciation Expense for the year ended December 31, 2020, assuming that during this period, the asset was used 6,000 hours?

A. $166,667

B. $97,200

C. $162,000

D. $171,333

Answer:

The depreciation expense for the year is $162000. Thus, option C is the correct answer

Explanation:

The depreciation expense is the systematic allocation of the cost of the asset over its estimated useful life. The depreciation can be calculated using various methods. Under the units of production method, the depreciation expense for the period is calculated using the following formula,

Depreciation expense = [(Cost - Residual value) / Total estimated production units] * Units produced in a particular period

Depreciation expense = [(500000 - 14000) / 18000] * 6000

Depreciation expense = $162000

When entering a foreign market, Montain stream brewery purchases a manufacturing plant and sets up a new brewery. Instead of using their signature name, the product produced in the foreign market is labeled as “Everest Prak Brew” This is an example of?

Answers

it's an example of brand localization

Michigan Corporation manufactured inventory in the United States and sold the inventory to customers in Canada. Gross profit from sale of the inventory was $500,000. Title to the inventory passed FOB: Destination. How much of the gross profit is treated as foreign source income for purposes of computing Michigan Corporation’s foreign tax credit in the current year?

Answers

Answer:

50% of gross profit = $250,000

Explanation:

The Tax Cuts and Jobs Act of 2017 changed some aspects of Section 863(b), but aspects regarding US companies producing locally and exporting their production to foreign countries remains the same. US companies can allocate 50% of gross profit as foreign source income, while the other 50% must be allocated as domestic income due to production related activities.

A customer owns a long-term negotiable CD. If the customer wishes to tender the CD prior to maturity, the registered representative should inform the customer that:

Answers

Complete Question:

A customer owns a long-term negotiable CD. If the customer wishes to tender the CD prior to maturity, the registered representative should inform the customer that:

A. a prepayment penalty will be charged

B. he or she will receive par value of the principal plus accrued interest

C. the CD may not be redeemed prior to maturity

D. the customer will receive the market value plus accrued interest

Answer:

D. the customer will receive the market value plus accrued interest.

Explanation:

In this scenario, a customer owns a long-term negotiable certificate of deposit (CD). If the customer wishes to tender the CD prior to maturity, the registered representative should inform the customer that the customer will receive the market value plus accrued interest.

Generally, in the stock markets when a customer wishes to withdraw his or her funds on any brokered CD, there are no penalties for such actions or choice. The registered representative should pro-rate the amount of interest earned by the customer over the period of time for the deposit.

g Sheffield Corp. purchased a truck at the beginning of 2017 for $109200. The truck is estimated to have a salvage value of $3800 and a useful life of 131750 miles. It was driven 23000 miles in 2017 and 31000 miles in 2018. What is the depreciation expense for 2018

Answers

Answer:

$24,800

Explanation:

Calculation for the depreciation expense for 2018 for Sheffield Corp.

Using this formula

Depreciation expense = (Purchased at the beginning-Salvage value/Useful life)* Driven miles

Let plug in the formula

Depreciation expense=($109,200-$3,800/131,750)*31,000

Depreciation expense=($105,400/131,750)*31,000

Depreciation expense=0.80*31,000

Depreciation expense=$24,800

Therefore the depreciation expense for 2018 will be $24,800

Vertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows: Current Year Previous Year Sales $4,000,000 $3,600,000 Cost of goods sold 2,280,000 1,872,000 Selling expenses 600,000 648,000 Administrative expenses 520,000 360,000 Income tax expense 240,000 216,000 a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. Round to the nearest whole percentage. Innovation Quarter Inc. Comparative Income Statement For the Years Ended December 31 Current year Amount Current year Percent Previous year Amount Previous year Percent Sales $4,000,000 % $3,600,000 % Cost of goods sold (2,280,000) % (1,872,000) % $ % $ % Selling expenses $(600,000) % $(648,000) % Administrative expenses (520,000) % (360,000) % $ % $ % $ % $ % Income tax expense (240,000) % (216,000) % $ % $ % b. The vertical analysis indicates that the cost of goods sold as a percent of sales by 5 percentage points, while selling expenses by 3 percentage points, and administrative expenses by 3 percentage points. Thus, net income as a percent of sales by 5 percentage points.

Answers

Answer:

Innovation Quarter Inc.

a) Comparative Vertical Analysis of Income Statement

                                          Current Year     %         Previous Year     %

Sales                                  $4,000,000   100%      $3,600,000     100%

Cost of goods sold              2,280,000    57%         1,872,000      52%

Gross profit                         $1,720,000    43%       $1,728,000      48%

Selling expenses                    600,000     15%          648,000        18%

Administrative expenses       520,000     13%          360,000        10%

Income tax expense              240,000       6%           216,000         6%

After Tax Income                 $360,000       9%       $504,000         14%

b. The vertical analysis indicates that the cost of goods sold as a percent of sales increased by 5 percentage points, while selling expenses decreased by 3 percentage points, and administrative expenses increased by 3 percentage points. Thus, net income as a percent of sales decreased by 5 percentage points.

Explanation:

Data and Calculations:

Vertical Analysis of Income Statement Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:

                                                Current Year         Previous Year

Sales                                        $4,000,000            $3,600,000

Cost of goods sold                    2,280,000               1,872,000

Selling expenses                          600,000                648,000

Administrative expenses             520,000                360,000

Income tax expense                    240,000                 216,000

Innovation Quarter Inc. can use this vertical analysis to express the relationship between each line item and the sales revenue.  The vertical analysis helps in ascertaining the percentage increases in each variable.  With the analysis, the management of Innovation Quarter Inc. can undertake further investigations to learn the causes of the different performances and learn ways to control them.

The declaration, record, and payment dates in connection with a cash dividend of $77,000 on a corporation's common stock are October 1, November 7, and December 15.

Required:
Journalize the entries required on each date.

Answers

Answer:

Oct 1

Dr Cash Dividend $77,000

Cr Dividend Payable $77,000

Nov 7

No Entry required on the record date

Dec 15

Dr Dividend Payable $77,000

Cr Cash

Explanation:

Preparation of the Journal entries for each date

Based on the information given we were told that the cash dividend of the amount of $77,000 was a corporation's common stock are October 1, November 7, and December 15 which means that the transaction will be recorded as:

Oct 1

Dr Cash Dividend $77,000

Cr Dividend Payable $77,000

Nov 7

No Entry required on the record date

Dec 15

Dr Dividend Payable $77,000

Cr Cash

Rather than crediting the Unearned rent account for $400 of prepaid rent received from a customer, which explains an alternate recording procedure to journalize this receipt?

Answers

Answer:

Record receipt with a credit to the rent revenue account

Any unused portion of the prepayment still existing at the end of the period will be transferred to the Unearned rent account

Explanation:

Prepaid rent is an income that is to be earned at a future date. Since income is normally recorded as a revenue when it is earned, we usually credit Unearned Rent account.

However financial statements are made at end of a defined period (for example monthly, quarterly, biannually, or yearly).

The journal entry can be credited to the Rent Revenue account directly. At the end of the period the amount earned is retained in the account, and the unearned portion of the prepaid rent is transferred to the Unearned Rent account.

So financial statements will only recognise earned income when prepared.

[The following information applies to the questions displayed below.]

Allied Merchandisers was organized on May 1. Macy Co. is a major customer (buyer) of Allied (seller) products.

May 3 Allied made its first and only purchase of inventory for the period on May 3 for 2,000 units at a price of $10 cash per unit (for a total cost of $20,000).
5 Allied sold 1,500 of the units in inventory for $14 per unit (invoice total: $21,000) to Macy Co. under credit terms 2/10, n/60. The goods cost Allied $15,000.
7 Macy returns 125 units because they did not fit the customer’s needs (invoice amount: $1,750). Allied restores the units, which cost $1,250, to its inventory.
8 Macy discovers that 200 units are scuffed but are still of use and, therefore, keeps the units. Allied sends Macy a credit memorandum for $300 toward the original invoice amount to compensate for the damage.
15
Allied receives payment from Macy for the amount owed on the May 5 purchase; payment is net of returns, allowances, and any cash discount.

Prepare journal entries to record the following transactions for Allied assuming it uses a perpetual inventory system and the gross method. (Allied estimates returns using an adjusting entry at each year-end.)

Answers

Answer:

                                  Allied Merchandisers

                                        Journal Entries

Date           General Journal                         Debit        Credit

03-May   Merchandise Inventory               $20,000

                     To Cash                                                     $20,000

05-May    Accounts Receivable                 $21,000

                      To Sales                                                    $21,000

05-May     Cost of goods sold                     $15,000

                     To Merchandise Inventory                        $15,000

07-May      Sales Returns and allowances   $1,750  

                      To Accounts Receivable                           $1,750

07-May      Merchandise Inventory               $1,250

                      To Cost of goods sold                                $1,250

08-May      Sales Returns and allowances    $300

                       To Accounts Receivable                            $300

15-May        Cash                                             $18,571

                   Sales Discounts                           $379

                    ($18950*2%)

                         To Accounts receivable                           $18,950

                          ($21000-$1750-$300)

In order to document a business transaction in the accounting records of the company, a journal entry is employed. A journal entry is often made in the general ledger, but it can also be made in a subsidiary ledger and subsequently rolled forward into the general ledger after being summarised.

The journal entry has been attached below:

Allied Merchandisers

                                       Journal Entries

Date           General Journal                         Debit        Credit

03-May   Merchandise Inventory               $20,000

                    To Cash                                                     $20,000

05-May    Accounts Receivable                 $21,000

                     To Sales                                                    $21,000

05-May     Cost of goods sold                     $15,000

                    To Merchandise Inventory                        $15,000

07-May      Sales Returns and allowances   $1,750  

                     To Accounts Receivable                           $1,750

07-May      Merchandise Inventory               $1,250

                     To Cost of goods sold is $1,250

08-May      Sales Returns and allowances    $300

                      To Accounts Receivable                            $300

15-May        Cash                                             $18,571

                  Sales Discounts                           $379

                   ($18950*2%)

                        To Accounts receivable                           $18,950

                         ($21000-$1750-$300)

After then, the general ledger is utilized to produce the company's financial statements.  The idea behind a journal entry is to use double-entry accounting, which requires that every company transaction be recorded at least twice.

For instance, when you make a cash sale, the revenue account and the cash account are both increased. Alternatively, if you purchase items on credit, this raises both the accounts payable and inventory accounts.

Learn more about journal entries here:

https://brainly.com/question/33438461

#SPJ6

Your first baby was born yesterday and is healthy and strong. To guard against your premature death, you want to purchase a life insurance policy that will replace $58,000 of your annual income until your child is 20 years old. How much life insurance should you purchase, if you assume a 3% inflation rate

Answers

Answer:

assuming the  interest rate is = 15% the  life insurance should you should purchase = $497854.0773

Explanation:

Given that :

Annual income receipt = $58000

Assumption:

If we assume that the inflation rate π = 3% = 0.03

Also , let assume that the interest rate is = 15%  = 0.15 since it is not given too

Then the effective interest rate = [tex]\dfrac{ (i-\pi)}{(1+\pi)}[/tex]

the effective interest rate = [tex]\dfrac{ (0.15-0.03)}{(1+0.03)}[/tex]

the effective interest rate = [tex]\dfrac{ (0.12)}{(1.03)}[/tex]

the effective interest rate = 0.1165

the effective interest rate = 11.65%

Since n = [tex]\infty[/tex]

The Principal amount of how much life insurance should you purchase is;

= Annual income receipt/the effective interest rate

= $58000/ 0.1165

= $497854.0773

An asset has had an arithmetic return of 11.9 percent and a geometric return of 9.9 percent over the last 86 years. What return would you estimate for this asset over the next 8 years? 23 years? 39 years? (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)

Answers

Answer:

11.74% ; 11.38%; 11.01%

Explanation:

Given the following :

Arithmetic return (Ar) = 11.9%

Geometric return (Gr) = 9.9%

N = 86 years = Past period

A) Return in the next 8 years

T = future period = 8 years

Return = (T - 1) / (N - 1) * Geometric average + (N - T) / (N - 1) * Arithmetic average.

Return = (8 - 1) / (86 - 1) * 0.099 + (86 - 8) / (86 - 1) * 0.119

(0.0823529 * 0.099) + (0.9176470 * 0.119)

= 0.1173529301

= 0.1173529301 * 100 = 11.74%

B) over the next 23 years

T = 23 years

Return = (T - 1) / (N - 1) * Geometric average + (N - T) / (N - 1) * Arithmetic average.

Return = (23 - 1) / (86 - 1) * 0.099 + (86 - 23) / (86 - 1) * 0.119

(0.2588235 * 0.099) + (0.7411764 * 0.119)

= 0.1138235181

= 0.1138235181 * 100 = 11.38%

C.) over 39 years

F = 39 years

Return = (T - 1) / (N - 1) * Geometric average + (N - T) / (N - 1) * Arithmetic average.

Return = (39 - 1) / (86 - 1) * 0.099 + (86 - 39) / (86 - 1) * 0.119

(0.4470588 * 0.099) + (0.5529411 * 0.119)

= 0.1100588121

= 0.1100588121 * 100 = 11.01%

Other Questions
Harveys Hardware is thinking about starting a line of lawnmowers to serve its customer base in the summer. The lawnmowers would be priced at $100 and Harvey the manager believes that they would sell 3 units. They have the following estimated costs.Units Produced Labor Cost Total cost 0 0 100 1 50 150 2 100 200 3 200 300 4 350 450What is the marginal cost of producing the third unit?a. $400b. $300c. $200d. $100 Which example below best describes a longitudinal design in a descriptive research project? A. A panel that consists of households that provide purchasing information at specified intervals over an extended period. B. Surveys involving 600 mall intercepts in six major cities to determine the likes and dislikes of health food. C. A variety of promotional offers would be displayed in stores, with each group of customers seeing only one offer and the resulting brand sales determined. D. None of the above Which Federal Reserve group is acting in this situation? why people cant choose what they wanna be? Credit card companies lose money on cardholders who fail to pay their minimum payments. They use a variety of methods to encourage their delinquent cardholders to pay their credit card balances, such as letters, phone calls and eventually the hiring of a collection agency. To justify the cost of using the collection agency, the agency must collect an average of at least $200 per customer. After a trial period during which the agency attempted to collect from a random sample of 100 delinquent cardholders, the 90% confidence interval on the mean collected amount was reported as ($190.25, $250.75). Given this, what recommendation(s) would you make to the credit card company about using the collection agency Adams is the executive partner of Adams & Co., CPAs. One of its smaller clients is a large nonprofit charitable organization. The organization has asked Adams to be on its board of directors, which consists of a large number of the communitys leaders. Membership on the board is honorary. Adams & Co. would be considered to be independent What is the value of x? A square of side 40 cm and a rectangle of length 50 cm has the same perimeter. Which has greater area? Please write the answer with steps. 20 POINTS AND BRAINLIEST!! Which of the following statements can be supported by the evidence shown in the graph?A. The line best fit shows a positive correlation between month number and minutesB. The line of best fits shows a negative correlation between the number of months and the number of minutes C. The line of best fits shows no correlation between the month number and the number of minutes Use the drop-down menus to label the graph according to its type. On a coordinate plane, a graph has two straight lines that connect at (0, 0). One line has a positive slope from (0, 0) going through (3, 2) and the other has a negative slope from (0,0) going through (4, negative 3). The graph above: How were Japan and China culturally different at the end of the 19th century Katherine's class is selling raffle tickets for $3 to raise money for charity. Katherine's class raised $504. Which equation would you use to find the number of tickets sold? Read the passage from chapter 1 of Animal Farm. At the last moment Mollie, the foolish, pretty white mare who drew Mr. Jones's trap, came mincing daintily in, chewing at a lump of sugar. She took a place near the front and began flirting her white mane, hoping to draw attention to the red ribbons it was plaited with. Which statement best describes the character of Mollie in this passage How does the basal metabolic rate (BMR) relate to hunger? Lewis works in a marketing firm and is assigned a very energetic team however lately has not experienced much growth in his career what can he do to boost his career growth? A. always ask for more resources during difficult times. B. ask for a different team to work with. C. offer creative solutions to problems during team discussions. D. post derogatory messages about the company on social media. Calculate the molar hydrogen ion concentration of each of the following biological solutions given the pH: (a) gastric juice, pH= 1.80 (b) urine, pH 4.75 56. on a map, the distance between jacksonville FL and tallahasse FL is about 5 inches. According to the scale, 1 inch represents 25 miles. About how far apart are these two cities? What is the sign of -456 +456 WILL GIVE BRAINLIEST!Read the text and the question. Then, choose the option with the correct answer to the question. Hola! Me llamo Miranda y soy de Estados Unidos. El verano pasado visit Costa Rica con mi familia. El animal que vimos fue el mono araa. La caza, la deforestacin y el uso de estas especies exticas como mascotas son algunas de las causas por las que esta especie est en vas de extincin. El mono araa come flores e insectos. La deforestacin no permite a los monos araas tener sus hbitats. Yo estoy escribiendo a mis amigos sobre por qu no es bueno tener un mono araa como mascota. Based on the text, what similar recommendation can Miranda give to her friends in the USA? Avoid having certain pets. Avoid purchasing pets from street markets. Avoid trading exotic pets. Avoid posting pictures of your exotic pet on the internet. | Find the quadratic polynomial whoseSum and products of zeros are 21/8 and 5/16