Answer: See explanation
Explanation:
First, we need to calculate the production budget and this will be:
Sales = $29000
Add: Closing inventory of finished goods = $2800
Less: Opening inventory of finished goods = $1200
Production budget = $30600
Direct material purchased:
Production = 30600
Add: Closing inventory of direct material = 24000
Less: Opening inventory of direct material = 24000
Direct material purchased = 36000
a. Budgeted costs for direct materials
= Direct material purchased × price per unit
= 30600 × $3
= $91800
b. Direct manufacturing labor
= Production unit × Cost per unit
= 30600 × $5
= $153000
c. Manufacturing overhead
= Production units × Cost per unit
= 30600 × $0.83
= $25398
Cincy Machinery stock currently sells for $77 per share. The market requires a return of 14 percent while the company maintains a constant 6 percent growth rate in dividends. What was the most recent annual dividend per share paid on this stock (that is, this year's dividend)
Answer:
$5.81
Explanation:
according to the constant dividend growth model
price = d1 / (r - g)
d1 =do(1 + g) = next dividend to be paid
r = cost of equity
g = growth rate
(do x 1.06) / (0.14 - 0.06) = 77
(d0 x 1.06) / 0.08 = 77
Multiply both sides by 0.08
d0 x 1.06 = 6.16
divide both sides by 1.06
d0 = 5.81
Multiplication. Phyllis, who is 30 years old, works for We Add for You Accounting. Phyllis has worked there for a number of years and is considering quitting in order to spend more time with her three active triplets, Sunny, Fussy, and Perky. She asks her boss, Bolivar, about the pension plan at We Add for You. Her boss tells her that she is not entitled to that information until she is at least 60 years old. Phyllis also asks about retaining her medical insurance protection if she quits and is told that she would have no right to do so. Bolivar also throws in that he has been monitoring her conversations and that he particularly enjoys the conversations between her and her single female friends involving failed dating experiences. He asks her to keep those up. Phyllis tells him that her personal phone calls are none of his business. Bolivar says that he can listen if he wants because the phones are his. Phyllis ends up starting her own company called We Multiply for You, and makes much, much more money. (In answering the following questions, assume all federal laws apply and that any pension and medical plan qualifies for regulation under federal law.) Which of the following addresses the retention of medical benefits upon leaving a job?
a. The Medical Benefits Retention Act (MBRA)
b. The Comprehensive Medical Benefits Retention Act (CMBRA)
c. The Consolidated Omnibus Budget Reconciliation Act (COBRA)
d. The Health and Maintenance Act (HMA)
e. The Americans with Disabilities Act (ADA)
Answer:
c. The Consolidated Omnibus Budget Reconciliation Act (COBRA)
Explanation:
The act was created and implemented in the year 1985 and that was passed by Congress. In this act it create and retains the medical benefits after leaving the job.
So according to the question the act that should be retained medical benefits upon leaving the job is COBRA
Hence, the correct option is c.
Bob is the owner of Apartments Complex. Betty is his manager. Bob informs all tenants in writing as part of their lease that rent may ONLY be paid to Bob and not to Betty. However, over the years, tenants pay Betty directly who gives the rent to Bob. Bob never objects. What types of agency authority does Betty have
Answer: perceived relationship
Explanation:
An agent is referred to as someone who is given authority by the principal and acts in his or her behalf and the agent is also under the control of such person.
From the question, the principal is Bob while Betty is his agent. The relationship that exist in thus case is the perceived relationship which means that the third party that us, the tenants in thus case believe that an agent is authorised by the principal to do a particular work such as collection of rent in this case but in reality thus doesn't exist. They ate not meant to pay to the manager in this case but they acted based on their perception and since the principal didn't complain, they continued doing it.
Jhumpa, Stewart, and Kelly are all one-third partners in the capital and profits of Firewalker General Partnership. In addition to their normal share of the partnership's annual income, Jhumpa and Stewart receive an annual guaranteed payment of $10,000 to compensate them for additional services they provide. Firewalker's income statement for the current year reflects the following revenues and expenses: Sales revenue $ 340,000 Interest income 3,300 Long-term capital gains 1,200 Cost of goods sold (120,000 ) Employee wages (75,000 ) Depreciation expense (28,000 ) Guaranteed payments (20,000 ) Miscellaneous expenses (4,500 ) Overall net income $ 97,000 (Leave no answer blank. Enter zero if applicable.) b. How will Firewalker allocate ordinary business income and separately stated items to its partners
Question Completion:
a.Given Firewalker’s operating results, how much ordinary business income (loss) and what separately stated items [including the partners’ self-employment earnings (loss) will it report on its return for the year?
Answer:
Firewalker General Partnership
a) In its return for the year, the partnership will report an ordinary business income of $117,000. It will also report the guaranteed payments and share of remaining profits as allocated below.
b) Allocation of business income:
Jhumpa Stewart Kelly Total
Guaranteed payments $10,000 $10,000 $20,000
Share of profit 32,333 32,333 $32,334 97,000
Total business income $117,000
Explanation:
a) Data and Calculations:
Share of profits and loss:
Jhumpa = 1/3
Steward = 1/3
Kelly = 1/3
Income Statement for the year:
Sales revenue $ 340,000
Cost of goods sold (120,000)
Gross profit $220,000
Interest income 3,300
Long-term capital gains 1,200
Income $224,500
Employee wages (75,000)
Depreciation expense (28,000)
Miscellaneous expenses (4,500)
Net income $117,000
Appropriation Section:
Net income $117,000
Guaranteed payments (20,000)
Shareable income $97,000
Allocation of business income:
Jhumpa Stewart Kelly Total
Guaranteed payments $10,000 $10,000 $20,000
Share of profit 32,333 32,333 $32,334 97,000
Total business income $117,000
What is the solution to this problem?
Flintstone Company is owned equally by Fred Stone and his sister Wilma, each of whom hold 2,400 shares in the company. Wilma wants to reduce her ownership in the company, and it was decided that the company will redeem 480 of her shares for $30,700 per share on December 31 of this year. Wilmaâs income tax basis in each share is $7,900. Flintstone has current E&P of $10,930,000 and accumulated E&P of $50,210,000.
a. What is the amount and character (capital gain or dividend) recognized by Wilma as a result of the stock redemption, assuming only the "substantially disproportionate with respect to the shareholder" test is applied?
b. What is Wilmaâs income tax basis in the remaining 1,920 shares she owns in the company?
c. Assuming the company did not make any dividend distributions this year, by what amount does Flintstone reduce its E&P as a result of the redemption?
Answer:
Explanation:
From the given information:
In Flinstone company;
The old ownership = 2400/(2400+200) = 50%
New onwership = 1920/(1920 + 2400) = 44.4%
The reduction in Wilma ownership in Flinstone company is from 50% to 44.4%
Dividend amount perceived by WIlma is:
$30700 × 480 shares = $14,736,000
The responsibility of Wilma in the wake of taking the redemption is in reality more than the 40% (80% x 50%), so she fails the considerably disproportionate test.
Hence, dividend recognition = $1,47,36,000
b)
Wilma's personal income tax expense premise in excess shares can be determined by summing back the unused tax premise of 480 offers reclaimed to the premise of her leftover offers 1920.
unused tax premise of 480 shares = 480 × $7900 = $37,92,000
premises of the remaining shares = 1920 × $7900 = $1,51,68,000
In the remaining shares, WIlma income tax = $37,92,000 + $1,51,68,000
= $1,89,60,000
c)
Flintstone will make the decrease in its E&P by a measure of profit perceived by Wilma =$1,47,36,000
Carey Company owns a plot of land on which burried toxic wastes have been discovered. Since it will require several years and a considerable sum of money before the property is fully detoxified and capable of generating revenues, Carey wishes to sell the land now. It has located two potenital buyers. Buyer A, who is willing to pay $480,000 for the land now, or Buyer B, who is willing to make 20 annual payments of $75,000 each, with the first payment to be made 5 years from today. Assuming that the appropraite rate of interest is 9%, wo whom should Carey sell the land. Show calculations.
Answer:
Carey should accept buyer A's offer
Explanation:
we need to compare the present values of both proposals:
Present value of proposal A = $480,000
Present value of proposal B:
present value of annuity in 5 years = $75,000 x 9.1285 (PVIFA, 9%, 20 periods) = $684,637.50
present value (today) = $684,637.50 / (1 + 9%)⁵ = $444,967.40
A leading beverage company sells its signature soft drink brand in vending machines for $0.87 per 12 oz. can. A vending machine has monthly fixed costs of space rental, energy consumption, and capital depreciation of $146. Variable cost for a can of soda is $0.48. The more pessimistic operations manager was concerned about rising costs and asked the sales manager, if fixed costs increase to $190 per month, and the variable costs increase by $.10 due to rising sugar costs, what is the new breakeven volume in units at the original price
Answer:
655
Explanation:
Breakeven quantity are the number of units produced and sold at which net income is zero
Breakeven quantity = fixed cost / price – variable cost per unit
$190 / ( 0.87 - 0.58) = 655.2 = 655 to the nearest whole number
15. A bottle‐filling operation has a target value of 20 and consistently averages 19.8 with a standard deviation of 0.5. The design engineers have established an upper specification limit of 22 and a lower specification limit of 18. Which statement concerning this process is TRUE? A. The two‐sided specification process capability index is 1.47 B. The one‐sided specification process capability index is 1.33 C. The process must be in control D. None of these is true
Answer:
A. The two sided specification process capability index is 1.47
Explanation:
The formula for calculating process capability index is :
( Upper specification Limit - Average of mean ) / 3 * Standard Deviation
CI = ( 22 - 19.8 ) / 3 * 0.5
CI = 1.47 approximately.
Dream, Inc., has debt outstanding with a face value of $6 million. The value of the firm if it were entirely financed by equity would be $18.25 million. The company also has 440,000 shares of stock outstanding that sell at a price of $32 per share. The corporate tax rate is 35 percent. What is the decrease in the value of the company due to expected bankruptcy costs? (Enter your answer in dollars, not millions of dollars, e.g., 1,234,567. Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
Answer:
$955,000
Explanation:
According to the Modigliani and Miller theory, we can calculate the value of the levered firm which is denoted by;
VI = Vu + tB
VI = 18.25million + 0.35(6million)
VI = 20.35 million
We can also calculate the total market value of the firm Vt by adding the debt (B) with the total equity (SV)
Vt = B + SV
Vt = 5 million + 440,000(32)
Vt = 5 million + 14.80 million
Vt = 19.80 million
Then the decrease in the value of the company due to bankruptcy is
Vb = VI - Vt
Vb = 20.35 million - 19.80 million
VB = $955,000
In this simulation, theoretical utilization of the intensive care unit (ICU) is calculated as the flow rate of patients that arrive for service at the ICU in a given unit of time divided by the ICU’s capacity to serve customers in that same unit of time. You can think about this as demand/capacity. What is the theoretical utilization of the ICU if the mean inter-arrival time is 4 hour(s), the mean length of stay is 6 hour(s), and there are 4 beds in the ICU?
Answer:
The theoretical utilization of the ICU is:
= 0.25 or 25%
Explanation:
Inter-arrival time or flow rate of patients that arrive for service at the ICU = 4 hours
Mean length of stay = 6 hours
ICU's capacity to serve customers in 6 hours = 4*6 = 24 bed-hours
Total demand = 6 hours
Therefore, the theoretical utilization = flow rate of patients that arrive for service at the ICU in a given unit of time divided by ICU's capacity to serve customers in that same unit of time
= 6 hours/24 bed-hours
= 0.25
Kayak Co. budgeted the following cash receipts (excluding cash receipts from loans received) and cash payments (excluding cash payments for loan principal and interest payments) for the first three months of next year.
Cash Receipts Cash payments
January $528,000 $473,700
February 405,000 350,700
March 470,000 536,000
According to a credit agreement with its bank, Kayak requires a minimum cash balance of $40,000 at each month-end. In return, the bank has agreed that the company can borrow up to $160,000 at a monthly interest rate of 1%, paid on the last day of each month. The interest is computed based on the beginning balance of the loan for the month. The company repays loan principal with any cash in excess of $40,000 on the last day of each month. The company has a cash balance of $40,000 and a loan balance of $80,000 at January 1.
Required:
Prepare monthly cash budgets for January, February, and March.
Answer:
Ending Cash Balance as are follows:
January = $40,000
February = $67,535
March = $40,000
Also, Loan Balance End of Month as follows:
January = $26,500
February = $0
March = $38,465
Explanation:
Note: See the attached excel file for the cash budget.
In the attached excel file, the following calculations are made:
January loan repayment = January Preliminary cash - January Interest expense - Minimum required cash balance = $94,300 - $800 - $40,000 = $53,500
February Loan repayment = January Loan Balance End of the Month = $26,500
March Additional Loan = Minimum required cash balance - March Preliminary cash balance = $40,000 - $1,535 = $38,465
From the attached excel file, we have Ending Cash Balance as follows:
January = $40,000
February = $67,535
March = $40,000
And also, Loan Balance End of Month as follows:
January = $26,500
February = $0
March = $38,465
explain the difference between production control and production planning
Answer:
Planning of the manufacturing process is deciding in advance what to do, how to do, when to do it and who is to do it. Controlling of the manufacturing process measures the digression of actual performance from the standard performance and takes corrective actions.
Explanation:
4. Suppose GDP is $15 million, private saving is $3 million, consumption is $8 million, public saving is $2 million. Assume the economy is closed.
(a) Calculate taxes minus transfer payments (T), government purchases (G), national saving (S), and investment (I).
(b) Is the government running a deficit or a surplus.? Explain
The country of Lessidinia has a tax system identical to that of the United States. Suppose someone in Lessidinia bought a parcel of land for 20,000 foci (the local currency) in 1960 when the price index equaled 100. In 2002, the person sold the land for 100,000 foci, and the price index equaled 600. The tax rate on nominal gains was 20 percent. Compute the taxes on the nominal gain and the change in the real value of the land in terms of 2002 prices to find the after-tax real rate of capital gain.
Answer: -30%
Explanation:
The Nominal gain is:
= 100,000 - 20,000
= 80,000 foci
Tax on nominal gain:
= 20% * 80,000
= 16,000 foci
After tax nominal value of land:
= 100,000 - 16,000
= 84,000 foci
The real value given the price index is:
= 84,000 / 600 * 100
= 14,000 foci
After tax real rate of cap. gain:
= (14,000 - 20,000) / 20,000
= -30%
On April 1, Townsley Company sold merchandise with a selling price of $10,000 on account to Trout Company, with terms 3/10, n/30. On April 5, Trout Company returned merchandise with a selling price of $1,000. Trout Company paid the amount due on April 9. What journal entry did Townsley Company prepare on April 9 assuming the gross method is used
Answer and Explanation:
The journal entry is shown below:
Cash $8,730
Sales Discount ($9,000 × 3%) $270
To Accounts receivable $9,000 ($10,000 - $1,000)
Here cash and sales discount is debited as it increased the assets and discount while on the other hand the account receivable should be credited as it reduced the assets
Seo Yeon is a paid intern working for a small team of four software developers. Each member of the team is facing different deadlines and requires her support at different times—and all of them want to pawn their least enjoyable tasks off on her. Seo Yeon is there to learn and is happy to help out on any tasks they can give her, but she only has 40 hours per work week to offer.
Identify the solution that is likely to best allocate her time between the four team members.
A. Seo Yeon should only work on tasks that provide her with the opportunity to further her personal knowledge.
B. Seo Yeon should set up an internal market, allocating 10 hours per week to each team member and allowing them to trade hours among themselves over the course of a month.
C. Seo Yeon should determine which team member is most valuable to the company and allocate all 40 hours to that team member.
D. Seo Yeon should allocate 10 hours per week to each team member and ensure that her time is distributed fairly between the team members each week.
Answer: B. Seo Yeon should set up an internal market, allocating 10 hours per week to each team member and allowing them to trade hours among themselves over the course of a month.
Explanation:
From the options given in the question, the solution that is likely to best allocate her time between the four team members will be option B "Seo Yeon should set up an internal market, allocating 10 hours per week to each team member and allowing them to trade hours among themselves over the course of a month".
Since the teams have different deadlines, she should allocate her time equally to the four teams and help them out based on their deadlines as those with nearer deadlines should be helped first. We should also note that she shouldn't allocate the whole 40 hours to a particular team as that's not fair and can bring about disunity.
Seo Yeon should set up an internal market, allocating 10 hours per week to each team member and allowing them to trade hours among themselves over the course of a month.
Explanation:
From the options given in the question, the solution that is likely to best allocate her time between the four team members will be option B "Seo Yeon should set up an internal market, allocating 10 hours per week to each team member and allowing them to trade hours among themselves over the course of a month".Since the teams have different deadlines, she should allocate her time equally to the four teams and help them out based on their deadlines as those with nearer deadlines should be helped first. We should also note that she shouldn't allocate the whole 40 hours to a particular team as that's not fair and can bring about disunity.To learn more,
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Jack and Jill are the only two residents in a neighbourhood, and they would like to hire a security guard. The value of a security guard is $50 per month to Jack and $90 per month to Jill. Irrespective of who pays the guard, the guard will protect the entire neighbourhood and charge $120 per month for the service. Suppose Jack earns $4,000 per month and Jill earns $8,000 per month.
a. With a proportional tax of 1 percent on income, how much would Jack and Jill pay, and would it be enough to pay for the security guard?
Jack would pay $ _____.
Jill would pay $ _____.
This tax _____ be enough to pay for the security guard.
b. Suppose instead that Jack proposes a payment scheme under which Jack and Jill would each receive the same net benefit from hiring the guard. How much would Jack and Jill pay now?
Jack would pay $ _____.
Jill would pay $ _____.
Would both Jack and Jill vote for this scheme? _____
Answer:
Jack and Jill
a. With a proportional tax of 1 percent on income, it would be enough to pay for the security guard $120.
Jack would pay $ __40___.
Jill would pay $ __80___.
This tax _will____ be enough to pay for the security guard.
b. Based on net benefit from the guard:
Jack would pay $ __43___.
Jill would pay $ _ 77____.
Would both Jack and Jill vote for this scheme? __No___ Jack will feel cheated by Jill in the sum of $3. Jack will likely prefer the 1% based on income.
Explanation:
a) Data and Calculations:
Value of a security guard for Jack = $50 per month
Value of a security guard for Jill = $90 per month
Total value of a security guard for both Jack and Jill = $140 ($50 + $90)
Cost of hiring a guard = $120 per month
Jack's monthly earnings = $4,000
Jill's monthly earnings = $8,000
Total monthly earnings for both Jack and Jill = $12,000
a. Proportional tax of 1 percent on income = $120 ($12,000 * 1%)
Jack will pay $4,000 * 1% = $40
Jill will pay $8,000 * 1% = $80
Total = $120
b. Net benefit scheme:
Jack will pay $50/$140 * $120 = $43
Jill will pay $90/$140 * $120 = $77
Total = $120
Chino Company reported net income of $23,000 for the current year. During the year, Inventory decreased by $7,500, Accounts Payable decreased by $8,250, Depreciation Expense was $10,500, and Accounts Receivable increased by $7,000. If the indirect method is used, what is the net cash provided by operating activities?
A). $25,750.
B). $56,250.
C). $42,250.
D). $11,000.
Answer: A). $25,750.
Explanation:
Cash from operating activities refers to cash from the business operations of the company.
Formula is:
= Net Income + Depreciation + Decrease in inventory - Accounts payable decrease - Accounts receivable increase
= 23,000 + 10,500 + 7,500 - 8,250 - 7,000
= $25,750
Explanation:
A). $25,750.
⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
Spiess Corporation has two major business segments--Apparel and Accessories. Data concerning those segments for December appear below: Sales revenues, Apparel $ 775,000 Variable expenses, Apparel $ 314,000 Traceable fixed expenses, Apparel $ 201,000 Sales revenues, Accessories $ 799,000 Variable expenses, Accessories $ 425,000 Traceable fixed expenses, Accessories $ 128,000 Common fixed expenses totaled $401,000 and were allocated as follows: $172,000 to the Apparel business segment and $229,000 to the Accessories business segment. Required: Prepare a segmented income statement in the contribution format for the company.
Answer:
Spiess Corporation
The segmented income statement in the contribution format for December:
Apparel Accessories Total
Sales revenues, $ 775,000 $ 799,000 $1,574,000
Variable expenses, 314,000 425,000 739,000
Contribution margin $461,000 $374,000 $835,000
Traceable fixed expenses, 201,000 128,000 329,000
Common fixed expenses 172,000 229,000 401,000
Total expenses $373,000 $357,000 $730,000
Net income $88,000 $17,000 $105,000
Explanation:
a) Data and Calculations:
Apparel Accessories
Sales revenues, $ 775,000 $ 799,000
Variable expenses, 314,000 425,000
Traceable fixed expenses, 201,000 128,000
Common fixed expenses 172,000 229,000
b)Spiess' segmented income statement presents the revenues and costs according to the business segments to enable the managers understand how their specific segments are performing vis-a-vis others in Spiess Corporation. It serves as a managerial tool for business insights.
Select the correct answer.
Which product is an athlete more likely to endorse?
A.
wine
B.
fast food
C.
sports drink
D.
tobacco products
Answer:
Which product is an athlete more likely to endorse? Fast Food
Phillip, the proprietor of a vineyard, estimates that the first 10900 bottles of wine produced this season will fetch a profit of $6 per bottle. However, the profit from each bottle beyond 10900 drops by $0.0001 for each additional bottle sold. Assuming at least 10900 bottles of wine are produced and sold, what is the maximum profit
Answer:
See below
Explanation:
With regards to the above information, we can write out the equation to be;
P = (10,900 + y)($6 - 0.0001y)
= 65,400 - 1.09y + 6y - 0.0001y^2
= 65,400 + 4.9y - 0.0001y^2
dp/dx = 4.9 - 0.002y
Set equal to zero to find maximum
4.9 - 0.002y = 0
y = 8,000
So, maximum profit is $
Wilson Animal Feeds has developed the following data to calculate lower of cost or market for its products.
Large animals:
Cattle $320 $160
Horse 400 400
Small animals:
Cat $360 $320
Dog 120 90
Exotic pets:
Ferret $140 $112
Iguana 70 48
The costs to sell are 20% of selling price.
Required:
Determine the reported inventory value assuming the lower of cost and net realizable value rule is applied to classes of feeds.
Answer:
The total reported inventory value is $1,130.
Explanation:
Note: The data given the question are sorted and presented properly as follows:
Selling Price Cost
Large animals:
Cattle $320 $160
Horse 400 400
Small animals:
Cat $360 $320
Dog 120 90
Exotic pets:
Ferret $140 $112
Iguana 70 48
Based on the lower of cost and net realizable value rule, we select the lower and determine the reported inventory value as follows:
Details Value ($)
Large animals:
Cattle 160
Horse 400
Small animals:
Cat 320
Dog 90
Exotic pets:
Ferret 112
Iguana 48
Total value 1,130
Therefore, the total reported inventory value is $1,130.
What is a product that is not an object or something that is owned called?
Answer:A product that is not an object or something that is owned is called a non-economic good.
Explanation:
A product that is not an object or something that is owned is called a non-economic good.
A local Chevrolet dealership carries the following types of vehicles:
Inventory Items Quantity Cost per Unit Market (replacement cost) per Unit
Vans 3 $22,000 $20,000
Trucks 6 17,000 16,000
2-door sedans 2 12,000 14,000
4-door sedans 7 16,000 19,000
Sports cars 3 32,000 35,000
SUVs 5 28,000 23,000
Because of recent increases in gasoline prices, the car dealership has noticed a reduced demand for its SUVs, vans, and trucks.
Required:
a. Compute the total cost of the entire inventory.
b. Determine whether each inventory item would be reported at cost or market. Multiply the quantity of each inventory item by the appropriate cost or market amount and place the total in the "Lower-of-Cost-or-Market" column. Then determine the total for that column.
c. Compare your answers in Requirement 1 and Requirement 2 and then record any necessary adjustment to write down inventory from cost to market value.
d. Discuss the financial statement effects of using lower-of-cost-or-market to report inventory.
Answer:
Explanation:
Since the table doesn't show up correctly, the first dollar value is the Cost per Unit of the vehicle, while the second dollar value is the Market Cost per Vehicle.
a. If we compute the cost using the Cost per Unit then they would be the following.
Vans: 3 * $22,000 = $66,000Trucks: 6 * $17,000 = $102,0002-Door Sedans: 2 * $12,000 = $24,0004-Door Sedans: 7 * $16,000 = $112,000Sports Cars: 3 * $32,000 = $96,000SUV's: 5 * $28,000 = $140,000Total Inventory: $504,000b. The "Lower-of-Cost-or-Market" basically states that whatever of the two prices is lower is ultimately the one that is recorded as the cost. Therefore, under this method the costs would be the following...(Purchase Cost or Market Cost)
Vans: 3 * $20,000 = $60,000 MarketTrucks: 6 * $16,000 = $96,000 Market2-Door Sedans: 2 * $12,000 = $24,000 Purchase Cost4-Door Sedans: 7 * $16,000 = $112,000 Purchase CostSports Cars: 3 * $32,000 = $96,000 Purchase CostSUV's: 5 * $23,000 = $115,000 MarketTotal Inventory: $504,000 Purchase Costc. There were only 3 changes made from from requirement 1 and 2 these were the changes in total cost...
Vans: $60,000 - $66,000 = - $6000Trucks: $96,000 - $102,000 = - $6000SUV's: $115,000 - $140,000 = - $25,000d. This allows companies to report losses at a much more reasonable and consistent way. Thus allowing profits to be more predictable.
a. Total inventory cost: $504,000
b. Total inventory at lower-of-cost-or-market: $503,000
c. Adjustment to write down inventory: -$37,000
d. Using lower-of-cost-or-market to report inventory allows for more realistic and conservative reporting, reflecting the decrease in market value.
a. If we compute the cost using the Cost per Unit then they would be the following.
Vans: 3 * $22,000 = $66,000
Trucks: 6 * $17,000 = $102,000
2-Door Sedans: 2 * $12,000 = $24,000
4-Door Sedans: 7 * $16,000 = $112,000
Sports Cars: 3 * $32,000 = $96,000
SUV's: 5 * $28,000 = $140,000
Total Inventory: $504,000
b. The "Lower-of-Cost-or-Market" basically states that whatever of the two prices is lower is ultimately the one that is recorded as the cost. Therefore, under this method the costs would be the following...(Purchase Cost or Market Cost)
Vans: 3 * $20,000 = $60,000 (reported at market)
Trucks: 6 * $16,000 = $96,000 (reported at market)
2-Door Sedans: 2 * $12,000 = $24,000 (reported at cost)
4-Door Sedans: 7 * $16,000 = $112,000 (reported at cost)
Sports Cars: 3 * $32,000 = $96,000 (reported at cost)
SUVs: 5 * $23,000 = $115,000 (reported at market)
Total for "Lower-of-Cost-or-Market" column: $60,000 + $96,000 + $24,000 + $112,000 + $96,000 + $115,000 = $503,000
c. The necessary adjustment to write down inventory from cost to market value is as follows:
Vans: -$6,000
Trucks: -$6,000
SUVs: -$25,000
d. Using the lower-of-cost-or-market method to report inventory allows companies to recognize and account for potential declines in the market value of their inventory.
By valuing inventory at the lower cost or market value, it ensures a conservative approach and provides a more accurate representation of the company's financial position.
This approach helps in reflecting the true economic value of inventory and potential losses associated with declines in market value.
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Suppose your company sells services of $370 in exchange for $205 cash and $165 on account. Required: Prepare the journal entry to record this transaction. Identify the amount that should be reported as net cash flow from operating activities. Identify the amount that would be included in net income. Show how the indirect method would convert net income (requirement 3) to net cash flow from operating activities (requirement 2).
Answer:
1. Journal Entry
Date Particulars Debit Credit
Cash $205
Debtors/Party A/c $165
To Service revenue $370
(Being service income recorded)
2. Net cash Flow = $370 - $165
Net cash Flow = $205
3. Calculation of Net Income
Net Income = Service Income - Expenses
Net Income = $370 - $0
Net Income = $370
4. Computation of how the indirect method convert the net income to net cash flow from operating activities
Particulars Amount
Net Income $370
Increase in accounts receivable ($165)
Net cash flow from operating activities $205
Imagine that the economy is in long-run equilibrium. Then, perhaps because of improved international relations and increased confidence in policy makers, people become more optimistic about the future and stay this way for some time.
1. Refer to Optimism. Which curve shifts and in which direction?
a. aggregate demand shifts right.
b. aggregate demand shifts left.
c. aggregate supply shifts right.
d. aggregate supply shifts left.
2. Refer to Optimism. In the short run what happens to the price level and real GDP?
a. both the price level and real GDP rise.
b. both the price level and real GDP fall.
c. the price level rises and real GDP falls.
c. the price level falls and real GDP rises.
3. Refer to Optimism. What happens to the expected price level and what's the result for wage bargaining?
A. The expected price level falls. Bargains are struck for higher wages.
B. The expected price level rises. Bargains are struck for higher wages.
C. The expected price level rises. Bargains are struck for lower wages.
D. The expected price level falls. Bargains are struck for lower wages.
4. Refer to Optimism. In the long run, the change in price expectations created by optimism shifts:_____.
a. long-run aggregate supply right.
b. long-run aggregate supply left.
c. short-run aggregate supply right.
d. short-run aggregate supply left.
5. Refer to Optimism. How is the new long-run equilibrium different from the original one?
a. both price and real GDP are higher.
b. both price and real GDP are lower.
c. the price level is the same and GDP is higher.
d. the price level is higher and real GDP is the same.
6. People choose to hold a smaller quantity of money if:_____.
a. the interest rate rises, which causes the opportunity cost of holding money to rise.
b. the interest rate falls, which causes the opportunity cost of holding money to rise.
c. the interest rate rises, which causes the opportunity cost of holding money to fall.
d. the interest rate falls, which causes the opportunity cost of holding money to fall.
7. When the Fed sells government bonds, the reserves of the banking system:___.
a. increase, so the money supply increases.
b. increase, so the money supply decreases.
c. decrease, so the money supply increases.
d. decrease, so the money supply decreases.
Answer:
1. a. aggregate demand shifts right.
As people are more optimistic, they will consume more in the short term because they feel as though prosperity is coming in the long term.
2. a. both the price level and real GDP rise.
Both of these would rise as Aggregate demand refers to GDP and price level would rise due to the new intersection with the Aggregate supply curve when the AD shifted right.
3. B. The expected price level rises. Bargains are struck for higher wages.
Expected price level will rise because demand is still increasing. Workers will want to benefit from this as well and so will negotiate higher wages.
4. d. short-run aggregate supply left.
As a result of the rise in expected price level and the subsequent negotiation for higher salaries, producers will find the cost of labor to be hire and so will limit production so that they do not spend as much. This will reduce supply thereby shifting the supply curve left.
5. d. the price level is higher and real GDP is the same.
The shift to the left in supply will lead to a higher price but the Real GDP will remain the same because there will be less goods produced so once prices are inflation adjusted, real GDP will be the same.
6. a. the interest rate rises, which causes the opportunity cost of holding money to rise.
If interest rates rise, people will hold less money because they could make a higher return by investing that money.
7. d. decrease, so the money supply decreases.
The money supply decreases because the Fed is taking money out of the banking system by selling bonds as people will pay the Fed for the bonds and the Fed will keep the money.
PLEASE , chart this out !
Answer:
Purchases
Date Qty Unit Cost Total Cost
11 12 $18 $216
21 9 $15 $135
Cost of Sales
Date Qty Unit Cost Total Cost
14
21 $16 $336
5 $18 $90
25
7 $18 $126
4 $15 $60
Total $612
Inventory
Qty Unit Cost Total Cost
5 $15 $75
Total $75
Explanation:
FIFO method assumes that the units to arrive first, will be sold first. Also note that the perpetual Inventory method is used. This means the cost of sales and inventory value is calculated after every transaction.
So with FIFO , Cost of Sales will be calculated on earlier prices (old prices) whilst Inventory will be valued at recent (later prices) prices.
What method can help to avoid typos when writing a function that includes a range?
Answer:
clicking and dragging to select the range
Frank is a salesman of Richard Laundry Equipment. He wants to give a presentation to a five star hotel for setting up an in-house laundry system. The hotel manager sent Frank the hotel's requirements and space constraints for a laundry system. Frank prepared a layout which suited the hotel's requirements. Frank has to select an approach for his allotted ten minute presentation. What advice can you give to Frank
Answer: Use customer benefit statements due to the time allotment.
Explanation:
The options include:
a. Use the curiosity approach to generate interest.
b. Open with a demonstration to convince the prospect.
c. Use customer benefit statements due to the time allotment.
d. Use the product approach to make the prospect aware of discounts.
e. Open with the premium approach as the prospect is a five star hotel.
Based on the information given, the advice that'll be given to Mike is to use the customer benefit statements due to the time allotment.
We should note that the benefit statements are typically used in scenarios whereby one knows the critical needs of the customer and there's a short time available for a presentation to be done. Since the Tim tht Frank has is short but he already knows what the hotel wants, then this is the best option.
Frank should use the customer benefit approach for is presentation since he has limited time to complete the same.
What is customer benefit approach?The customer benefit approach refers to an approach that involves prior research before presenting anything before the audience. It focuses on the consumer specific benefit of the product or service that are prompt to be offered.
The customer benefit approach is usually used when there is a time limit for completing the presentation or the assigned task.
In the given case Frank was given 10 minutes to complete his presentation about the in house laundry system in 5 star hotel.
Therefore the appropriate advice is to use customer benefit approaches.
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Aqua Corporation uses the weighted average method in its process costing system. Cost data for its work in process department follow:
Materials Conversion
Beginning work in process $67,000 $48,000
Costs added during the period $125,000 $225,000
Assuming equivalent units of production for materials are 90,000 and for conversion are 20,000, the cost per equivalent unit for materials during the period is closest to: ________
a. $3.89
b. $1.75
c. $1.39
d. $2.13
Answer:
See below
Explanation:
The cost per equivalent unit for materials during the period is closest is computed as;
Beginning work in process
$67,000
Add:
Costs added during the period
$125,000
Balance
$192,000
÷
Units of production for materials
90,000
= $2.13
