Pharoah Company had the following two transactions related to its delivery truck. 1. Paid $280 for an oil change. 2. Paid $600 to install a special gear unit, which increases the operating efficiency of the truck.Required:Prepare Pharoah's journal entries to record these two transactions.

Answers

Answer 1

Answer:

1.

Oil change expense             $280 Dr

     Cash                                         $280 Cr

2.

Delivery Truck Account                    $600 Dr

       Cash                                                 $600 Cr

Explanation:

1.

The cost incurred to cover the day to day expenses related to an asset which does not increase the asset's useful life or benefit but merely maintains them are recorded as revenue expenditure. Such expenses are charged as expenses to the income statement. The cost incurred for oil change which is for maintenance purpose is a revenue expenditure.

2.

The cost incurred for capital expenditure is added to the cost of the asset and systematically charged to the income statement using the depreciation. Any expense that will increase the life or operating efficiency and benefit form a fixed asset is a capital expenditure and is capitalized by adding it to the cost of the asset. So, installation of a special gear unit giving increased efficiency is a capital expenditure.


Related Questions

Write a detailed note on Manufacturing Process types and Service process types in process design?

Answers

Answer:

Each of the process are used to the crosses organizational borders.

Explanation:

Process structure of manufacturing:

Job process: It is highly adaptable, scaled operation and structured around particular events. Batch process: It most common used in industries. It is small to large batches. Line process: It is the repetitive process and have modular production with large quantity. Continuous flow chart: It is product focused process. It processed only one item at a time.

Process design: There are three major process of design

Professional service designMass service designService shop design

If I currently sell 10,000 units, and my use of Formula 1 indicates that I will need to sell 500 additional units to justify my suggested change to the marketing mix, what percentage of sales does that represent

Answers

Answer:

It represents a 5% change to the marketing mix.

Explanation:

The change = 500/10,000 x 100 = 5%.

Company A's change in a variable can be compared with another index, by expressing the change (addition) as a percentage of the index.  For instance, the sale of 10,000 units is an index.  The additional 500 units that is needed to be sold represent the change.  In percentage terms, the change can be divided by the index and then multiplied by 100.

You can spend $150 on either a new Kindle or a new pair of boots. If you choose to buy the new kindle, the economic cost of it is:

Answers

Answer:

$300

Explanation:

The economic cost is the sum of implicit cost and explicit cost.The implicit cost is the cost by implication, which is the cost of alternative forgone.

The explicit cost is the actual cost requiring actual cash flow in settling it.

Economic cost=cost of new kindle+cost of alternative forgone(new pair of boots)

Economic cost=$150+$150

The explicit cost is also the cost incurred from accounting point of view

The ending finished goods inventory for each month equals 50% of next month's sales in units . How many units must be produced in February?

Answers

Answer: 15,751.5 units

Explanation:

Units produced in February are calculated as;

Units Produced = Ending Finished goods - Beginning Finished goods + Budgeted Sales

Ending finished goods inventory for each month equals 50% of next month's sales in units.

Ending finished goods for February

= 50% * 15,581

= 7,790.5‬ units

Ending finished goods for January is beginning for February

= 50% * 15,922

= 7,961

Units Produced = Ending Finished goods - Beginning Finished goods + Budgeted Sales

= 7,790.5‬ -  7,961 + 15,922

= 15,751.5 units

In an attempt to bring about a change in the organization, what do you think might happen to The Learning Focus if Nemeroff fired all the existing writers and replaced them with new writers

Answers

Answer:

If all existing writers are replaced with new writers there could be a number of issues as the existing writers had experience and were use to of the type of writing required, they understand the nature of the reader. The new writers might fail to satisfy the old readers as they will be unaware of the taste the readers want and like to read. If learning focus Nemeroff fired all the existing writers the above described issues may appear.

Explanation:

If all existing writers are replaced with new writers there could be a number of issues as the existing writers had experience and were use to of the type of writing required, they understand the nature of the reader. The new writers might fail to satisfy the old readers as they will be unaware of the taste the readers want and like to read. If learning focus Nemeroff fired all the existing writers the above described issues may appear.

1. What are Red Bull's greatest strengths and risks as more companies (like Coca-Cola, Pepsi, and Monster) enter the energy drink category and gain market share? 2. Should Red Bull do more traditional advertising? Why or why not? Discuss the effectiveness of Red Bull's sponsorships, for example, Bull Stratos. Is this a good use of Red Bull' marketing budget? Where should the company draw the line?

Answers

Answer:

Strengths

RedBull is a well-established brand in the Energy Drink sub-sector.It has been in existence since 1987 making it a 33-year-old company. That's a lot of experience doing the same thing. Given its years of experience, consumers have a lot of confidence in its brand. This means it has strong brand equity.As of 2019, RedBull still has the highest market share of any energy drink in the world with a record 7.5 billion cans sold

Risks

The challenge is this, Coca-cola is a much older company with about 128 years behind it. It was established in 1892.Coca-cola equally has a very strong brand equityIn the carbonated drinks sub-sector, it has dominated the sector since 2004. It's market share is estimated at 42.5%.It has about 500 brands compared to Redbull which has only one brand.In Pepsi was created in 1893. Just one year younger than Coca-cola. It currently has about 24.9% of the soda market. Within the cola segment alone, it has about 100 flavours.Monster energy as a strong entrant into the energy drink market is only 18 years old and it already has 49 different drinks with about 14% market share worldwide.

Suffice it to say that if Red Bull does not concieve of a critical strategy to maintain market dominance, it may continue to bleed it's market share.

2. Red Bull should do more than traditional advertising.

There is no reason why it can go into the Soda space. There are countries where the big players still exert a huge dominance. Mexico, for instance, consumes the more coca-cola than anywhere else in the world.

Red Bull in addition to keeping it's market share through aggressive advertising, can enter into the soda market, targeting these regions where coca-cola and other players seem to have a pseudo monopoly.

Red Bull can also look at creating more flavours depending on the psychographics of the target market it is looking at.

Bull Stratos

Red Bull Stratos is the official name for the project involving Mr Baumgartner's mission. Mr Baumgartner's project involved a record breaking jump for the ages from the edge of space which cost about USD 30 million. It is on record that this is nothing like what Red Bull have ever done before and it did so at a fraction of it's annual sports marketing which is estimated at about USD 300 Million.

To answer the question about its effectiveness, its definitely yes.

Over 8 million people saw the jump which had the Red Bull logo/ branding conspicuously displayed. It was dubbed "the most successful Public Relations campaign of year 2012."

The line will always be dictated by the metrics which show returns on marketing budget invested.

Any strategy that currently works to enhance the brand of Red Bull or at least keep its dominance over the energy drink market, must be explored.

Cheers!

A rights offer made to existing shareholders with the sole purpose of making it more difficult for another firm to acquire the company is called

Answers

Answer:

Poison pill

Explanation:

Poison pill is a strategy that is used to avoid that another party takes over an organization by allowing the current shareholders of the firm to acquire more shares. According to this, the answer is that a rights offer made to existing shareholders with the sole purpose of making it more difficult for another firm to acquire the company is called poison pill as this is a defensive strategy that companies use to avoid a takeover from an outside party.

Booker Corporation had the following comparative current assets and current liabilities: Dec. 31, 2019 Dec. 31, 2018 Current assets Cash $60,000 $30,000 Short-term investments 40,000 10,000 Accounts receivable 55,000 95,000 Inventory 110,000 90,000 Prepaid expenses 35,000 20,000 Total current assets $300,000 $245,000 Current liabilities Accounts payable $140,000 $110,000 Salaries payable 40,000 30,000 Income tax payable 20,000 15,000 Total current liabilities $200,000 $155,000 During 2019, credit sales and cost of goods sold were $750,000 and $400,000, respectively. Compute the following liquidity measures for 2019:

Answers

Answer:

1. 1.5 Times

2.$100,000

3.0.775 Times

4.$75,000

5.$100,000

Explanation:

Liquidity ratios can be found by just simply putting the given values in their appropriate formulas. All you have to memorize is the simple formulas

1.Current Ratio  

CURRENT RATIO = CURRENT ASSETS/CURRENT LIABILITIES

CURRENT RATIO = $300,000/$200,000

CURRENT RATIO = 1.5 Times

2. Working Capital

WORKING CAPITAL= CURRENT ASSETS- CURRENT LIABILITIES

WORKING CAPITAL= $300,000 - $200,000

WORKING CAPITAL= $100,000

3. Acid ratio

ACID RATIO = CURRENT ASSETS - INVENTORY - PREPAID EXPENSES/CURRENT LIABILITIES

ACID RATIO = ($300,000 - $110,000 - $35,000)/$200,000

ACID RATIO = 0.775 Times

4. Receivable turnover

RECEIVABLE TURNOVER = CREDIT SALES/AVERAGE RECEIVABLE

RECEIVABLE TURNOVER = $750,000/$75,000

RECEIVABLE TURNOVER = 10 Times

Working

AVERAGE RECEIVABLE = (Opening receivables+Closing receivables)/2

AVERAGE RECEIVABLE = ($55,000 + $95,000) / 2 = $75,000

5. Inventory Turnover

INVENTORY TURNOVER = COST OF GOODS SOLD / AVERAGE INVENTORY

INVENTORY TURNOVER = $400,000 / $100,000

INVENTORY TURNOVER = 4 Times

Working

AVERAGE INVENTORY = (Opening inventories+Closing inventories)/2

AVERAGE INVENTORY = (110,000 + 90,000)/2

AVERAGE INVENTORY = $100,000

The principle that each World Trade Organization member must accord to all other member countries tariff treatment no less favorable than it provides to any other country is known as the __________ principle.

Answers

Answer:

Most favoured nation principle

Explanation:

Most favoured nation (MFN) clause of the World Trade Organisation requires that when a nation trades with others the concessions, immunities, and privileges granted to one nation should be the the same granted to all WTO members.

It discourages discrimination where one nation in international trade is favoured above another.

For example if Ghana reduces tariff on trades with South Africa it is expected that tariffs to other WTO nations will also be reduced to 3%.

Exceptions to this principle are for developing nations, regional free trade areas, and custom unions.

A company with 99,006 authorized shares of $8 par common stock issued 48,828 shares at $13 per share. Subsequently, the company declared a 2% stock dividend on a date when the market price was $22 a share. What is the amount transferred from the retained earnings account to paid-in capital accounts as a result of the stock dividend?

A. $43,563
B. $21,484
C. $7,812
D. $13,672

Answers

Answer:

$21,484

Explanation:

A company has 99,006 authorized shares of $8 par

The common stock was issued at 48,828 shares at the price of $13 for one share

The company made a 2% dividend declaration

= 2/100

= 0.02

The market price is $22 per share

Therefore, the amount that was transferred from the retained earnings account to the paid-in capital accounts can be calculated as follows

= 48,828 shares × 0.02 × $22

= $21,484

Hence the amount that was moved from the retained earnings account to the paid-in capital accounts as a result of stock dividend is $21,484

You notice that​ Coca-Cola has a stock price of $41.86 and EPS of $1.88. Its competitor PepsiCo has EPS of $3.65. ​But, Jones​ Soda, a small batch​ Seattle-based soda producer has a​ P/E ratio of 34.2. Based on this​ information, what is one estimate of the value of a share of PepsiCo​ stock?

Answers

Answer:

Value of share of Pepsi Co. stock = $82

Explanation:

Stock price of Coca-cola = $41.86

EPS = $1.88

P/E ratio = MPS / EPS

P/E ratio = $41.86 / 1.88

P/E ratio = 22.27

Jones soda P/E ratio = 34.2

Pepsi Co stock EPS = $3.65

Value of share of Pepsi Co. stock = EPS * P/E ratio

Value of share of Pepsi Co. stock = $3.65 * 22.27

Value of share of Pepsi Co. stock = $81.2855

Value of share of Pepsi Co. stock = $82

Conversion costs are:_______.
A. The direct labor costs associated with processing a product.
B. The combined costs of converting raw materials to finished goods.
C. The overhead costs associated with processing a product.
D. All the costs that go into the manufacturing of a product (DM, DL and OH).

Answers

Answer:

B. The combined costs of converting raw materials to finished goods.

Explanation:

Conversion Costs are the combined costs of converting raw materials to finished goods.

These include the costs of direct labor and manufacturing overheads such as water and electricity.

Zapper has beginning equity of $293,000, net income of $69,000, dividends of $58,000 and stockholder investments of $24,000. Its ending equity is:

Answers

Answer:

$328,000

Explanation:

As we all know that:

Ending Equity = Opening Equity + Share Issues + Net Income – Net Loss – Dividends Paid

Here,

Opening Equity is $293,000

Money raised through Shares Issuance was $24,000

Net Income would be $69,000

Dividends paid were $58,000

There were no losses as their is Profit for the year (Net Income).

By putting values, we have:

Ending Equity = $293,000  +  $24,000   +  $69,000   -  $58,000

= $328,000

Suppose the real risk-free rate is 3.50%,the average future inflation rate is 2.50%, a maturity premium of 0.20% per year to maturity applies, i.e., MRP = 0.20%(t), where t is the years to maturity. Suppose also that a liquidity premium of 0.50% and a default risk premium of 0.80% applies to A-rated corporate bonds.

Required:
What is the difference in the yields on a 5-year A-rated corporate bond and on a 10-year Treasury bond?

Answers

Answer:

the 5 year A-rated corporate bond yields 0.3% more than the 10-year Treasury bond

Explanation:

the yield of a 10 year treasury bond = real risk free rate + average future inflation rate + (maturity premium x number of years) = 3.5% + 2.5% + (20% x 10 years) = 8%

the yield of a 5 year A-rated corporate bond = real risk free rate + average future inflation rate + liquidity premium + default risk premium + (maturity premium x number of years) = 3.5% + 2.5% + 0.5% + 0.8% + (20% x 5 years) = 8.3%

difference in yields = 8.3% - 8% = 0.3%

​What is the relationship between total surplus and economic efficiency?

Answers

Answer: When total surplus gets maximized, then economy meet economic efficiency.

Explanation:

Economic efficiency is described as a thinking that there is one possible way to make situation better by imposing a cost on another.

Total surplus is described as the sum of producer and consumer surplus.

It gets maximized in a perfect competition (hit free-market equilibrium).

i.e. It gets maximized when both consumer and producer surplus is maximum, and then the economy meet economic efficiency.

Just Born found that the improvement process emphasized in the management leadership program saved the company millions of dollars. This is an example of a(n)

Answers

Answer: Results outcome

Explanation:

Just Born found that the improvement process emphasized in the management leadership program saved the company millions of dollars. This is an example of a results outcome.

This shows that the improvement process emphasized in the management leadership program brought about a positive outcome.

A firm has a profit margin of 5.1 percent, a total asset turnover of 1.84, and a return on equity of 16.2 percent. What is the debt-equity ratio

Answers

Answer:

Debt / Equity = 0.72649 : 1 or 72.649%

Explanation:

The ROE or return on equity can be calculated using the Du Pont equation. It breaks the ROE into three components. The formula for ROE under Du Pont is,

ROE = Net Income / Sales * Sales / Total Assets * Total Assets / Shareholder's equity

or

ROE = Net Income / Total equity

Assuming that sales is $100.

Net Income = 100 * 0.051 = 5.1

Total Assets = 100 / 1.84

Total Assets = 54.35

0.162 = 5.1 / Total equity

Total Equity = 5.1 / 0.162

Total Equity = 31.48

We know that Assets = Debt + Equity

So,

54.35 = Debt + 31.48

Debt = 54.35 - 31.48

Debt = 22.87

Debt / Equity = 22.87 / 31.48

Debt / Equity = 0.72649 : 1 or 72.649%

If Tex's Manufacturing Company purchases the component externally, $20,000 of the fixed costs can be avoided. At what external price for the 100 units is the company indifferent between making or buying

Answers

Answer:

$210,000

Explanation:

The computation of the external price is shown below

Making cost =  buying  cost

$120,000 + $25,000 + $45,000 + $30,000) = external price + Unavoidable fixed cost (30,000-20,000)

$220,000 = External price + $10,000

So,

External price = 210,000

Hence, the same is to be considered

Therefore the external price is $210,000

if average demand for invenrory item is 200 units per day lead time is three days and safety stock is 1-- units the reorder point is

Answers

please do you mean 1 unit for safety stock or 100 units, will solve for both

Answer:when safety stock =1, Reorder point= 601 units

when safety stock =100,  Reorder point= 700 units

Explanation:

Reorder Point (ROP), also called  reorder level, is the point  of inventoryset by a busness  in which it replenishes its stock of items.

given:

Average demand= 200

lead time = 3

when safety stock =1

Reorder point= (Average demand X Delivery lead time ) + Safety stock

                = (200 x 3 ) +1 = 601 units

when safety stock = 100

   Reorder point= (Average demand X Delivery lead time ) + Safety stock

                = (200 x 3 ) +100 = 700 units              

Under the allowance method, when writing off an account receivable, the journal entry to record the write-off includes a credit to:

Answers

Answer: credit to Accounts Receivable

Explanation:

Accounts Receivable is the payment that a particular company will get from the customers who have bought the company's product or services on credit.

Under the allowance method, when writing off an account receivable, the journal entry to record the write-off includes a credit to account receivables.

a. Monetary Policy involves changing_______________ the money supply. In the United States, Monetary Policy is implemented by the____________.
1. taxes and government spending
2. the design of currency
3. exports
4. Federal Reserve
5. President and Congress
6. Secretary of the Treasury/ states.
b. _______________ can be used to address a Recessionary Gap; while _________ can be used to address an Inflationary Gap.
1. Contractionary Monetary Policy
2. Lower prices
3. Expansionary MonetaryPolicy
4. Larger coins
5. smaller coins
6. higher prices
c. To enact Contractionary Monetary Policy, the central bank will _________bonds. This ____________the amount of cash in the economy. This will cause bond prices to ____________and interest rates to _____________. The change in interest rates causes investment and consumption to___________ shifting ____________.
1. fall
2. stay the same
3. rise,
4. Short-Run Aggregate Supply
5. Aggregate Demand
6. Long-Run Aggregate Supply
7. Outward
8. inward
9. buy
10. sell
11. increase
12. decrease

Answers

Answer:

In the United States, Monetary Policy is implemented by the - 4. Federal Reserve

The Federal Reserve of the United States is in charge of implementing the Monetary Policy of the country. It is also in charge of regulating the financial industry, and acting as lender of the last result to prevent financial crisis.

3. Expansionary MonetaryPolicy - can be used to address a Recessionary Gap

During times of economic downturn, monetary policy tends to be expansionary: expanding the money supply to lower the interest rate, so that investment becomes cheaper, and the economy reactivates.

1. Contractionary Monetary Policy - can be used to address an Inflationary Gap.

When the money supply is too high, or has grown too fast, inflation often starts. For this reason, the fed usually implements contractionary monetary policy (less money supply, higher interest rate), in order to keep inflation from increasing.

c. To enact Contractionary Monetary Policy, the central bank will - sell bonds

When the fed sell bonds, it takes money from the market, reducing the money supply.

This - reduces - the amount of cash in the economy.

As explained above.

This will cause bond prices to - fall - and interest rates to - rise

The change in interest rates causes investment and consumption to - fall

shifting - Aggregate Demand

Contractionary monetary policy will cause interest rates to rise, making investment more expensive, and causing price hikes, this will reduce consumption.

This in turn will shift the Aggregate Demand curve to the left or inward.

Nakatomi Corporation produces 10,000 units of Product A at a cost of $20 per unit. A detailed breakdown of the cost is below. Choose the correct answer from the options provided. Per Unit Variable costs $ 12 Allocated manufacturing overhead costs 3 Allocated general administrative costs 5 $ 20 Outside supplier's offer $ 17 What are the total relevant cost of producing the units internally

Answers

Answer:

$120,000

Explanation:

Calculation for the total relevant cost of producing the units internally

Using this formula

Total relevant cost = Variable costs per unit*Units Produce

Let plug in the formula

Total relevant cost=$12 per unit* 10,000 units

Total relevant cost=$120,000

Therefore the total relevant cost of producing the units internally will be $120,000

Tyler Company applies manufacturing overhead to production at the rate of $4.9 per direct labor hour and ended August with $12,900 underapplied overhead. Actual manufacturing overhead incurred for August amounted to $110,410.
How many direct labor hours did Tyler Company incur during August?

Answers

Answer: 19,900 hours

Explanation:

Direct Labor hours = Applied Manufacturing Overhead/ Applied Overhead rate per hour

Applied Manufacturing Overhead

When the overhead is said to be under-applied, the Applied overhead is less than the Actual Overhead.

To find the Applied overhead therefore;

= Actual Overhead - Under-applied amount

= 110,410 - 12,900

= $97,510

Direct Labor hours = Applied Manufacturing Overhead/ Applied Overhead rate per hour

= 97,510/4.9

= 19,900 hours

Statement of retained earnings.  Use the data from the following financial statements in the popup​ window,
LOADING...
Partial Income Statement Year Ending 2014
Sales revenue
$350,200
Cost of goods sold
$141,800
Fixed costs
$42,900
Selling, general, and administrative expenses
$28,000
Depreciation
$46,200
Partial Balance Sheet 12/31/2013
ASSETS
LIABILITIES
Cash
$16,000
Notes payable
$14,000
Accounts receivable
$27,800
Accounts payable
$19,100
Inventories
$48,000
Long-term debt
$189,900
Fixed assets
$368,000
OWNERS' EQUITY
Accumulated depreciation (-)
$140,200
Retained earnings
Intangible assets
$82,000
Common stock
$131,900
Partial Balance Sheet 12/31/2014
ASSETS
LIABILITIES
Cash
$26,200
Notes payable
$11,900
Accounts receivable
$18,800
Accounts payable
$24,100
Inventories
$53,200
Long-term debt
$161,800
Fixed assets
$447,800
OWNERS' EQUITY
Accumulated depreciation (-)
Retained earnings
Intangible assets
$82,200
Common stock
$181,900
. The company paid interest expense of
$ 18 comma 700$18,700
for 2014 and had an overall tax rate of
40 %40%
for 2014. Complete the statement of retained earnings for​2014, and determine the dividends paid last year.
The distributed earnings is
​$nothing.
​(Round to the nearest​ dollar.)
Complete the statement of retained​ earnings:  ​(Round to the nearest​ dollar.)
Statement of Retained Earnings
Year Ending December 31, 2014
Beginning balance
$
Add net income
$
Subtract dividends
$
Ending balance
$

Answers

beginning balance: $350,200
add net income: $467,987
subtract dividend: $110,109
ending balance: ^^^^^^^
$110,109 is your answer

On October 10, the stockholders? equity of Sherman Systems appears as follows:
Common stock?$10 par value, 72,000 $ 720,000
shares authorized, issued, and outstanding
Paid-in capital in excess of par value, common stock 216,000
Retained earnings 864,000
Total stockholders equity $ 1,800,000
Prepare journal entries to record the following transactions for Sherman Systems.
1a. Purchased 5,000 shares of its own common stock at $25 per share on October 11.
1b. Sold 1,000 treasury shares on November 1 for $31 cash per share.
1c. Sold all remaining treasury shares on November 25 for $20 cash per share.
2. Prepare the revised equity section of its balance sheet after the October 11 treasury stock purchase.

Answers

Answer: Please find answers in explanation column

Explanation:

Common stock?$10 par value, 72,000

shares authorized, issued, and outstanding                 $ 720,000

Paid-in capital in excess of par value, common stock  $216,000

Retained earnings                                                         $864,000

Total stockholders equity                                             $1,800,000

a)journal entry to record the purchase of shares on Oct 11

Date  Account                                Debit                 Credit

Oct 11 Treasury stock                     $125,000

Cash                                                                $125,000

Calculation

value of the Treasury stock=No.of shares×Value per share

=5,000×$25  =$125,000

b. journal entry to record the sales of treasury shares.

​Date  Account                                Debit                 Credit

Oct 11  Cash                                     $31,000

Treasury stock                                                       $25,000

Paid in capital from the sale of the stock

(31,000 - 25,000)                                                      $6,000

Calculation

Cash =No.of shares×Value per share

=1,000×$31 =$31,000

Treasury stock=No.of shares× purchased value of share

=1,000×$25  =$25,000

1c)journal entry to record the sales of the remaining  treasury shares

​Date  Account                                              Debit                 Credit

Nov 1  Cash                                                $80,000

Paid in capital from the sale of the stock $6,000

Retained earning                                     $14,000

Treasury stock                                                               $100,000

Calculation

Remaining treasury shares = 5000-1000= $4000

Cash =No.of shares×Value per share

=4, 000× 20  =$80 ,000

Treasury stock=No.of shares× purchased value of share

=4,000×$25  =$100,000

recall paid in  capital from sale = $6000

retained earnings = treasury stock - cash- paid in capital= 100,000- 80,000 - 6,000= $14,000

2) Revised equity of the balance sheet to show new  total stockholders’ equity

Account /Particulars                                Amount

Common stock $ 720,000

Paid-in capital   $216,000

Retained earnings         $864,000

less Treasury stock       ($125,000)

Balance                                                    $739,000

Total stockholders equity                      $1,675,000

Acme Company’s production budget for August is 17,600 units and includes the following component unit costs: direct materials, $7.70; direct labor, $10.10; variable overhead, $6.20. Budgeted fixed overhead is $33,000. Actual production in August was 18,810 units. Actual unit component costs incurred during August include direct materials, $8.50; direct labor, $9.10; variable overhead, $6.90. Actual fixed overhead was $34,600. The standard direct material cost per unit consists of 11 pounds of raw material at $0.7 per pound. During August, 319,770 pounds of raw material were used that were purchased at $0.50 per pound.

Required:
Calculate the materials price variance and materials usage variance for August.

Answers

Answer:

Instructions are below.

Explanation:

Giving the following information:

Actual production in August was 18,810 units.

During August, 319,770 pounds of raw material were used that were purchased at $0.50 per pound.

The standard direct material cost per unit consists of 11 pounds of raw material at $0.7 per pound.

To calculate the direct material price and quantity variance, we need to use the following formulas:

Direct material price variance= (standard price - actual price)*actual quantity

Direct material price variance= (0.7 - 0.5)*319,770

Direct material price variance= $63,954 favorable

Direct material quantity variance= (standard quantity - actual quantity)*standard price

Standard quantity= 18,810*11= 206,910

Direct material quantity variance= (206,910 - 319,770)*0.7

Direct material quantity variance= $79,002 unfavorable

BioGrow Pharma Inc. wanted its research partner, an R&D company, to develop a cancer vaccine. However, the project required huge capital investments, and its research partner was not ready to solely face the risks involved. Thus, to gain its partner's confidence and to prove its involvement, BioGrow Pharma invested $100 million in the project. This investment made by BioGrow Pharma will result in a _____.

Answers

Answer: credible commitment

Explanation:

From the question, we are informed that BioGrow Pharma Inc. wanted its research partner, an R&D company, to develop a cancer vaccine but that the project required huge capital investments, and its research partner was not ready to solely face the risks involved.

Therefore, to gain its partner's confidence and to prove its involvement, BioGrow Pharma invested $100 million in the project. This investment made by BioGrow Pharma will result in a credible commitment.

Granger Inc. Comparative Balance Sheets December 31

Assets 2017 2016
Cash $80,800 $48,400
Accounts receivable 87,800 38,000
Inventory 112,500 102,850
Prepaid expenses 28,400 26,000
Long-term investments 138,000 109,000
Plant assets 285,000 242,500
Accumulated depreciation (50,000) (52,000)
Total $682,500 $514,750

Liabilities and Stockholders' Equity
Accounts payable $102,000 $67,300
Accrued expenses payable 16,500 21,000
Bonds payable 110,000 146,000
Common stock 220,000 175,000
Retained earnings 234,000 105,450
Total $682,500 $514,750


Granger Inc. Income Statement Data For the Year Ended December 31, 2017

Sales revenue $388,460

Less:
Cost of goods sold $135,460
Operating expenses, excluding depreciation 12,410
Depreciation expense 46,500
Income tax expense 27,280
Interest expense 4,730
Loss on disposal of plant assets 7,500 233,880
Net income $154,580

Additional information:

1. New plant assets costing $90,000 were purchased for cash during the year.
2. Old plant assets having an original cost of $51,750 and accumulated depreciation of $43,650 were sold for $1,350 cash.
3. Bonds payable matured and were paid off at face value for cash.
4. A cash dividend of $23,427 was declared and paid during the year.

Required:
Prepare a statement of cash flows for Granger Inc. using the direct method.

Answers

Answer:

                                       GRANGER INC.

       STATEMENT OF CASH FLOWS (USING INDIRECT METHOD)

                  FOR THE YEAR ENDED DECEMBER 31, 2017

                Particulars                                                    Amount$

Cash flow from operating activities

Net Income                                                                    154,580

Adjustments to reconcile net income to net cash

provided by operating activities  

Adjustment for non cash effects

Depreciation expense                                                   46,500

Loss on sale of plant assets                                           7,500

Change in operating assets & liabilities

Increase in Accounts receivable                                  -49,800

Increase in inventory                                                      -9,650

Increase in prepaid expenses                                        -2,400

Increase in accounts payable                                         34,700

Decrease in accrued expenses payable                       -4,500

Net cash flow from operating activities (a)                 176,930

Cash Flow from Investing activities

Old Plant assets sold                                                       1,350

New plant assets purchased                                         -90,000

Long-term investments purchased                                -29,000

Net cash Flow from Investing activities (b)                -117,650

Cash Flow from Financing activities

Cash dividends paid                                                        -23,427

Common stock issued                                                      45,000

Bonds paid                                                                        -36,000

Net cash Flow from Financing activities (c)                 -14,427

Net Change in cash c=a+b+c                                            44,853

Add: Beginning cash balance                                           48,400

Closing cash balance                                                        93,253

Improvements in labor​ productivity: A. affect the level of​ wages, but do not affect the rate of economic growth. B. affect the level of​ profit, but do not affect the rate of economic growth. C. contribute to economic growth. D. hinder economic​ growth, because they cause unemployment.

Answers

Answer:

C. contribute to economic growth

Explanation:

Economic growth is an increase in the the production of  goods and services produced in an economy.

Improvements in labor​ productivity increases the output of labour and as a result contributes to economic growth.

What element of the tourism and recreation industry has increased tenfold over the last fifteen years, bringing increased revenue to cities in the Coastal South such as Miami, Fort Lauderdale, and Tampa

Answers

Answer: A. The Cruise Ship Industry

Explanation:

The Cruise Ship Industry has been until recently (due to the Pandemic) one of the fastest growing elements of Tourism and Recreation in the United States having increased tenfold over the last 15 years.

Indeed in 2018, it was estimated that the industry added over $52 billion to the US economy as well as employing over 400,000 people.

This massive growth has benefitted port cities from which these Cruises take off and return to such as Miami, Fort Lauderdale, and Tampa immensely.

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