Susan and Bill Stamp want to set up a TDA that will generate sufficient interest at maturity to meet their living expenses, which they project to be $1,200 per month. (Round your answers to the nearest cent.)
(a) Find the amount needed at maturity to generate $1,350 per month interest, if they can get 7 % interest compounded monthly.
(b) Find the monthly payment that they would have to make into an ordinary annuity to obtain the future value found in part (a) if their money earns 9 % and the term is twenty years.

Answers

Answer 1

Answer:

(a) The amount needed is $192,000.

(b) The monthly payment is $150.98.

Explanation:

Note: There are errors in this question. The correct question is therefore provided before answering the question as follows:

Susan and Bill Stamp want to set up a TDA that will generate sufficient interest at maturity to meet their living expenses, which they project to be $1,200 per month. (Round your answers to the nearest cent.)

(a) Find the amount needed at maturity to generate $1,200 per month interest, if they can get 7.25% interest compounded monthly.

(b) Find the monthly payment that they would have to make into an ordinary annuity to obtain the future value found in part (a) if their money earns 9.75% and the term is twenty years.

The explanation of the answer is now given as follows:

(a) Find the amount needed at maturity to generate $1,200 per month interest, if they can get 7.25% interest compounded monthly.

This can be calculated using the following future value formula:

FV = P / i ........................... (1)

Where;

FV = Amount needed at maturity = ?

P = Monthly payment or amount to generate monthly = $1,200

i = monthly interest rate = Annual interest rate / 12 = 7.25% / 12 = 0.075 / 12 = 0.00625

Substituting the values into equation (1), we have:

FV = $1,200 / 0.00625 = $192,000

Therefore, the amount needed is $192,000.

(b) Find the monthly payment that they would have to make into an ordinary annuity to obtain the future value found in part (a) if their money earns 9.75% and the term is twenty years.

This can be calculated using the Future Value (FV) of an Ordinary Annuity as follows:

FV = M * (((1 + r)^n - 1) / r) ................................. (2)

Where,

FV = Future value = $192,000

M = Monthly payment = ?

r = Monthly interest rate = 9.75% / 12 = 0.0975 / 12 = 0.008125

n = number of months = 25 years * Number of months in a year = 25 * 12 = 300

Substituting the values into equation (2) and solve for M, we have:

$192,000 = M * (((1 + 0.008125)^300 - 1) / 0.008125)

$192,000 = M * 1271.65920375075

M = $192,000 / 1271.65920375075

M = $150.98

Therefore, the monthly payment is $150.98.


Related Questions

Derek will deposit $9,359.00 per year for 18.00 years into an account that earns 4.00%, The first deposit is made next year. He has $18,418.00 in his account today. How much will be in the account 49.00 years from today

Answers

Answer:

FV= $904,322.05

Explanation:

First, we will calculate the future value of the 18 deposits 19 years from now. Also the value of the $18,418 19 years from now.

FV= {A*[(1+i)^n-1]}/i

A= annual deposit= 9,359

n= 18

i= 0.04

FV= {9,359*[(1.04^18) - 1]} / 0.04

FV= $240,015.42

FV= PV*(1+i)^n

FV= 18,418*(1.04^19)

FV= $38,803.95

Total FV= 240,015.42 + 38,803.95= $278,819.37

Finally, the value of the account for the remaining 30 years:

FV= 278,819.37*(1.04^30)

FV= $904,322.05

Tirri Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 7.50 Direct labor $ 3.85 Variable manufacturing overhead $ 1.55 Fixed manufacturing overhead $ 24,400 Sales commissions $ 1.05 Variable administrative expense $ 0.60 Fixed selling and administrative expense $ 8,800 If the selling price is $28.10 per unit, the contribution margin per unit sold is closest to:

Answers

Answer:

$13.55

Explanation:

The contribution margin per unit is computed as;

= Selling price - (Direct materials + Direct labor + Variable manufacturing overhead + Sales commission + Variable administrative expense)

= $28.10 - ($7.50 + $3.85 + $1.55 + $1.05 + $0.60)

= $28.10 - $14.55

= $13.55

Therefore , the contribution margin per unit is $13.55

Don James purchased a new automobile for $21,000. Don made a cash down payment of $5,250 and agreed to pay the remaining balance in 30 monthly installments, beginning one month from the date of purchase. Financing is available at a 24% annual interest rate.

Required:
Calculate the amount of the required monthly payment.

Answers

Answer:

monthly payment. = $703.24 per month

Explanation:

given data

Cost of auto = $21000

Cash Down payment = $5250

Loan amount = PV = 21000-5250

loan amount = $15,750

time period  = 30 monthly

Rate = 24% pa = 24÷12 = 2% pm

solution

we get here monthly payment that is express as

monthly payment. = [tex]\frac{P\times r\times (1+r)^n}{(1+r)^n-1}[/tex]      ...................1

put here value and we get

monthly payment. = [tex]\frac{15750\times 0.02\times (1+0.02)^{30}}{(1+0.02)^{30}-1}[/tex]

solve it we get

monthly payment. = $703.24 per month

Melissa is an unmarried person who earns a salary of $54,000 per year and has $500 of interest income. Her itemized deductions total $2,500. She is able to use a non-refundable credit of $400. She has $5,000 of federal income taxes withheld from her wages. What is the amount of Melissa's REFUND OR TAX DUE FOR 2020

Answers

Answer:

$6150

Explanation:

These are the details of Melissa's income

Salary = $54000

Interest income = 500

Itemized deductions = $ 2500

Non refundable credit = $400

Withheld federal income tax = $5000

We have to calculate the amount of her tax return for year 2020

Taxable income = 54000+500-2500

= $52500

Tax rate 22%

Tax on taxable income = 52500x0.22

= 11550

Minus non refundable credit = 11550-400

Minus federal tax withheld = 11550-400-5000

= $6150

Lincoln Company purchased merchandise from Grandville Corp. on September 30, 2021. Payment was made in the form of a noninterest-bearing note requiring Lincoln to make six annual payments of $4,400 on each September 30, beginning on September 30, 2024. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided. Round your final answer to nearest whole dollar amount.) Required: Calculate the amount at which Lincoln should record the note payable and corresponding purchases on September 30, 2021, assuming that an interest rate of 9% properly reflects the time value of money in this situation.

Answers

Answer: $16,613

Explanation:

As the noninterest-bearing note required Lincoln to make six annual payments of $4,400, this is an annuity because it is a constant figure.

The amount that should be recorded is the present value of this amount.

Present value of annuity = Annuity * ( 1 - ( 1 + rate) ^ -no. of periods) / rate

= 4,400 * ( 1 - ( 1 + 9%)⁻⁶) / 9%

= $19,738

This present value is for September 30, 2023. It needs to be discounted further to September 30, 2021.

= 19,738 / (1 + 9%)²

= $16,613

Emilio’s accountant told him that if he continues to pay $50 a month on his credit card, it will take him 42 years to pay off his current balance (assuming the interest rate doesn’t change and assuming he doesn’t charge anything else on that card). His credit card interest rate is 18.99%. What is his balance?

Answers

Answer:

$3,158.40  

Explanation:

The current balance on his credit card is the present value of $50 payable per month over 42-year period as shown below:

PV=monthly payment*(1-(1+r)^-n/r

PV=the unknown

montly paymet=$50

r=monthly interest rate= 18.99%/12=0.015825

n=number of monthly payments=42*12=504

PV=$50*(1-(1+0.015825)^-504/0.015825

PV=$50*(1-(1.015825)^-504/0.015825

PV=$50*(1-0.000365827)/0.015825

PV=$50*0.999634173/0.015825

PV=$3,158.40  

On January 1, 2012, Sunland Company purchased for $690000, equipment having a useful life of ten years and an estimated salvage value of $40200. Sunland has recorded monthly depreciation of the equipment on the straight-line method. On December 31, 2020, the equipment was sold for $160000. As a result of this sale, Sunland should recognize a gain of

Answers

Answer:

$54,820

Explanation:

The computation of the gain is shown below;

But before that following calculations must be done

Annual depreciation as per the straight-line method

= ($690,000 - $40,200) ÷ (10 years)

= $64,980

Now accumulated depreciation for 9 years is

= $64,980 × 9 years

= $584,820

Now the book value is

= $690,000 - $584,820

= $105,180

Now the gain is

= Sale value - book value

= $160,000 - $105,180

= $54,820

Compare and by converting their income statements to common size. Martinez Rojo Net sales. . . . . . . . . . . . . . . . . . . . . . . . . . . $10,900 $19,536 Cost of goods sold. . . . . . . . . . . . . . . . . . 6,660 14,203 Other expense. . . . . . . . . . . . . . . . . . . 3,564 4,356 Net income. . . . . . . . . . . . . . . . . . . . . . . . . $676 $977 Which company earns more net​ income? Which​ company's net income is a higher percentage of its net​ sales?

Answers

Answer:

a. Rojo

b. Martinez

Explanation:

When converting the income statement to common size, everything is made a percentage of net sales.

                                                             Martinez                            Rojo

Net Sales                                                100%                              100%

Cost of goods sold                                (61.1% )                           ( 72.7%)

Other expenses                                     (32.7% )                         ( 22.3%)

Net Income                                               6.2%                             5.0%

Working

                                                           Martinez                             Rojo

Cost of goods                                 6,660/10,900                   14,203/19,536

Other expenses                              3,564/10,900                     4,365/19,536

Net income                                      676/10,900                         977/19,536                                

a. Company with more Net income

= Rojo

b. Company with higher net income as percentage of net sales

= Martinez

Billed Mercy Co. $2,400 for services performed.
how to journalize this?

Answers

When a business transaction requires a journal entry, we must follow these rules:

The entry must have at least 2 accounts with 1 DEBIT amount and at least 1 CREDIT amount.

The DEBITS are listed first and then the CREDITS.

The DEBIT amounts will always equal the CREDIT amounts.

For another example, let’s look at the transaction analysis we did in the previous chapter for Metro Courier (click Transaction analysis):

1. The owner invested $30,000 cash in the corporation. We analyzed this transaction by increasing both cash (an asset) and common stock (an equity) for $30,000. We learned you increase an asset with a DEBIT and increase an equity with a CREDIT. The journal entry would look like this:

2. Purchased $5,500 of equipment with cash. We analyzed this transaction as increasing the asset Equipment and decreasing the asset Cash. To increase an asset, we debit and to decrease an asset, use credit. This journal entry would be:

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Answer:

All the journal entries illustrated so far have involved one debit and one credit; these journal entries are called simple journal entries. Many business transactions, however, affect more than two accounts. The journal entry for these transactions involves more than one debit and/or credit. Such journal entries are called compound journal entries.

Explanation:

1.  The owner invested $30,000 cash in the corporation.  We analyzed this transaction by increasing both cash (an asset) and common stock (an equity) for $30,000. We learned you increase an asset with a DEBIT and increase an equity with a CREDIT

2.  Purchased $5,500 of equipment with cash.  We analyzed this transaction as increasing the asset Equipment and decreasing the asset Cash.  To increase an asset, we debit and to decrease an asset, use credit.

3. Purchased a new truck for $8,500 cash.   We analyzed this transaction as increasing the asset Truck and decreasing the asset Cash.  To increase an asset, we debit and to decrease an asset, use credit.

4.  Purchased $500 in supplies on account.  We analyzed this transaction as increasing the asset Supplies and the liability Accounts Payable.  To increase an asset, we debit and to increase a liability, use credit.

5.  Paid $300 for supplies previously purchased.  Since we previously purchased the supplies and are not buying any new ones, we analyzed this to decrease the liability accounts payable and the asset cash.  To decrease a liability, use debit and to decrease and asset, use debit.

6.  Paid February and March Rent in advance for $1,800.  When we pay for an expense in advance, it is an asset.  We want to increase the asset Prepaid Rent and decrease Cash.  To increase an asset, we debit and to decrease an asset, use credit.

7.  Performed work for customers and received $50,000 cash.  We analyzed this transaction to increase the asset cash and increase the revenue Service Revenue.  To increase an asset, use debit and to increase a revenue, use credit.

8.  Performed work for customers and billed them $10,000.  We analyzed this transaction to increase the asset accounts receivable (since we have not gotten paid but will receive it later) and increase revenue.  To increase an asset, use debit and to increase a revenue, use credit.

9.  Received $5,000 from customers from work previously billed.  We analyzed this transaction to increase cash since we are receiving cash and we want to decrease accounts receivable since we are receiving money from customers who we billed previously and not new work we are doing.  To increase an asset, we debit and to decrease an asset, use credit.

10 Paid office salaries $900.  We analyzed this transaction to increase salaries expense and decrease cash since we paid cash.  To increase an expense, we debit and to decrease an asset, use credit.

11. Paid utility bill $1,200.  We analyzed this transaction to increase utilities expense and decrease cash since we paid cash.  To increase an expense, we debit and to decrease an asset, use credit.

Pab Corporation decided to establish Sollon Company as a wholly owned subsidiary by transferring some of its existing assets and liabilities to the new entity. In exchange, Sollon issued Pab 30,000 shares of $6 par value common stock. The following information is provided on the assets and accounts payable transferred:

Cost Book Value Fair Value
Cash $44,000 $44,000 $44,000
Inventory 76,000 76,000 76,000
Land 79,000 79,000 109,000
Buildings 175,000 134,000 249,000
Equipment 90,000 76,000 121,000
Accounts Payable 63,000 63,000 63,000

Required:
Prepare the journal entry that Pab recorded for the transfer of assets and accounts payable to Sollon.

Answers

Answer:

Debit : Cash $44,000

Debit : Inventory  $76,000

Debit : Land $109,000

Debit : Buildings $249,000

Debit : Equipment  $121,000

Credit : Accounts Payable $63,000

Credit : Shares (30,000 x $6) $180,000

Credit ; Gain on Bargain Purchase $356,000

Explanation:

Assets and liabilities are acquired at their Fair Value Amounts instead of Cost or Book Value.

A transfer of some of the asset of a Company is referred as a Asset acquisition transaction instead of Business Combination (Acquirer obtains control of one or more businesses).

This is an asset Acquisition Transaction and no consolidated Financial Statements will be prepared.

The excess of Net Assets Acquired over the consideration is called Gain on Bargain Purchase and this amounts to $356,000.

On January 1, 2020, Marigold Corp. purchased a machine costing $355000. The machine is in the MACRS 5-year recovery class for tax purposes and has an estimated $74000 salvage value at the end of its economic life. It's based on half year convention. Assuming the company uses the general MACRS approach, the amount of MACRS deduction for tax purposes for the year 2020 is

Answers

Answer:

$71,000

Explanation:

Note: The MARCS Table is attached below

Depreciation for 2020 = Cost*Rate%

Depreciation for 2020 = $355000*20%

Depreciation for 2020 = $71,000.

Note: MACRS depreciation disregards the salvage value and depreciates the asset to zero over the life of the asset.

Swifty Corporation issued 100000 shares of $10 par common stock for $1250000. A year later Swifty acquired 15900 shares of its own common stock at $15 per share. Three months later Swifty sold 8500 of these shares at $19 per share. If the cost method is used to record treasury stock transactions, to record the sale of the 8500 treasury shares, Swifty should credit

Answers

Answer:

the journal entries should be:

Dr Cash 1,250,000

    Cr Common stock 1,000,000

    Cr Additional paid in capital 250,000

Dr Treasury stock 238,500

    Cr Cash 238,500

Dr Cash 161,500

    Cr Common stock 85,000

    Cr Additional paid in capital 76,500

You have decided to invest $15,000 in a money market fund that pays you interest at the annual rate of 6% and compounds interests monthly. Your plan is to take out your money in a year and pay taxes on the interest earned. If the corresponding tax rate is 20%, how much money in total will you expect to receive in a year after paying taxes.

Answers

Answer:

$15,869.66

Explanation:

The formula for determining the future value of the amount invested is :

FV = PV x (1 + r / m)^mn

FV = Future value  

PV = Present value  

R = interest rate  

N = number of years

m = number of compounding

$15,000 x (1+ 0.06/12)^12 = $15,925.17

Interest earned = future value - present value

$15,925.17 - $15,000 = $925.17

Tax paid on interest earned = 0.06 x  $925.17 = $55.51

Interest after taxes = $925.17 - $55.51 = $869.66

Total amount expected = $15,000 + $869.66 = $15,869.66

3. You are considering investing in a startup company called Minions Technologies. After careful analysis, you determine that Minions will be able to generate $100,000 in cash flow at the end of each year for the first 5 years. Then, Minions will generate cash flow of $400,000 at the end of the 6th year, after which it will grow at 11% per year forever. Using a discount rate of 18%, what is the amount you would be willing to invest

Answers

Answer:

$2,810,467

Explanation:

we need to determine the enterprise value of Minions Technologies

first, the terminal value at year 5 = $400,000 / (18% - 11%) = $5,714,286

then we must find the present value of all future cash flows, including the terminal value

PV of 5 five cash flows = $100,000 x 3.127 (PV annuity factor, 18%, 5 periods) = $312,700

PV of terminal value = $5,714,286 / 1.18⁵ = $2,497,767

total enterprise value = $2,810,467

An investor is in the 33 percent tax bracket and pays long-term capital gains taxes of 15 percent. What are the taxes owed (or saved in the case of losses) in the current tax year for each of the following situations?
a) Net short-term capital gains of $3,000; net long-term capital gains of $4,000
b) Net short-term capital gains of $3,000; net long-term capital losses of $4,000
c) Net short-term capital losses of $3,000; net long-term capital gains of $4,000
d) Net short-term capital gains of $3,000; net long-term capital losses of $2,000
e) Net short-term capital losses of $4,000; net long-term capital gains of $3,000
f) Net short-term capital losses of $1,000; net long-term capital losses of $1,500
g) Net short-term capital losses of $3,000; net long-term capital losses of $2,000

Answers

Answer:

The taxes owed (or saved in the case of losses) in the current tax year for each of the following situations) are:

     Taxes owed     Taxes saved

a.       $1,590              $0

b.       $0                     $1,000

c.       $150                 $0

d.      $0                     $1,000

e.      $0                     $1,000

f.       $0                   $2,500

g.      $0                  $5,000

Explanation:

a) Data:

Investor's tax bracket = 33% (same as the short-term capital gains taxes)

Long-term capital gains taxes = 15%

b) Events and Calculations:

a) Net short-term capital gains of $3,000; net long-term capital gains of $4,000

Short-term tax = $990 ($3,000*33%)

Long-term tax = $600 ($4,000*15%)

Total taxes =    $1,590

b) Net short-term capital gains of $3,000; net long-term capital losses of $4,000

Long-term capital losses = $4,000

Short-term capital gains =   (3,000)

Savings =                             $1,000

c) Net short-term capital losses of $3,000; net long-term capital gains of $4,000

Long-term capital gains = $4,000

Short-term capital losses  (3,000)

Long-term capital gains taxes = $150 ($1,000 * 15%)

d) Net short-term capital gains of $3,000; net long-term capital losses of $2,000

Short-term capital gains = $3,000

Long-term capital losses   (2,000)

Savings =                            $1,000

e) Net short-term capital losses of $4,000; net long-term capital gains of $3,000

Short-term capital losses = $4,000

Long-term capital gains       (3,000)

Savings                                $1,000

f) Net short-term capital losses of $1,000; net long-term capital losses of $1,500

Short-term capital losses = $1,000

Long-term capital losses      1,500

Savings =                            $2,500

g) Net short-term capital losses of $3,000; net long-term capital losses of $2,000

Short-term capital losses = $3,000

Long-term capital losses      2,000

Savings =                            $5,000

Slapshot Company makes ice hockey sticks. During the month of June, 1,900 sticks were completed at a cost of goods manufactured of $437,000. Suppose that on June 1, Slapshot had 350 units in finished goods inventory costing $80,000 and on June 30, 370 units in finished goods inventory costing $84,000.
1. Prepare a cost of goods sold statement for the month of June.
Slapshot Company
Cost of Goods Sold Statement
For the Month of June
*Cost of goods sold
*Cost of goods Inventory, June 1
*Finished goods inventory June 30
*Work In process, June 1
___*___ $_____
___*___ _____
___*__ _____
__*____ $_____
2. Calculate the number of sticks that were sold during June.
units

Answers

Answer:

1. Cost of goods sold statement

Cost of goods sold Inventory, June 1             $80,000

Add: Cost of goods manufactured                 $437,000

Cost of goods available for sale                     $517,000

Less: Cost of goods sold Inventory, June 31 $84,000

Cost of goods sold                                          $433,000

2. Number of sticks sold during June

Units on June 1                           350

Add: Manufactured in June       1,900

Sticks available for sale             2,250

Less: Ending units June 30       370  

Number of sticks sold               1,880

Marge owns land and a building (held for investment) with an adjusted basis of $75,000 and a fair market value of $250,000. The property is subject to a mortgage of $400,000. Because Marge is in arrears on the mortgage payments, the creditor is willing to accept the property in return for canceling the amount of the mortgage.
a. How can the adjusted basis of the property be less than the amount of the mortgage?
b. If the creditor's offer is accepted, what are the effects on the amount realized, the adjusted basis, and the realized gain or loss for Marge?
c. Does it matter in (b) if the mortgage is recourse or nonrecourse?

Answers

Answer:

A. The amount deducted for Depreciation may be higher than the amortized amount of the mortgage principal.

Decrease in the value of the property after they granted the mortgage

Bi $400,000

ii. $75,000

iii. $325,000

C.No

Explanation:

a. The adjusted basis of the property can be tend to be lesser than the amount of the mortgage due to the fact that in the beginning of an asset life the amount that was deducted for Depreciation may be more higher than the amortized amount of the mortgage principal .

Secondly the adjusted basis of the property can be tend to be lesser than the amount of the mortgage when their is Decrease in the value of the property after they granted the mortgage .

Lastly the adjusted basis of the property can be tend to be lesser than the amount of the mortgage when the fair market value of Property are been given instead of the Adjusted basis of the property.

b. Calculation for the effects on the amount realized, the adjusted basis, and the realized gain or loss for

i. Based on the information given the amount that was realized will be the amount of $400,000

ii. Based on the information given the Adjusted basis will be the amount of $75,000

iii. Realized gain=$400,000 − $75,000

Realized gain= $325,000

c.No it don't not matter if the mortgage is recourse or nonrecourse since the amount that was realized was the amount of $400,000 and

to justify the nonrecourse mortgage is that the taxpayer has already enjoy some benefit when the mortgage was acquired due to the increase in Adjusted basis of the property.

An analysis of the company's insurance policies provided the following facts.

Policy Date of Purchase Months of Coverage Cost

A April 1, 2017 24 $10,824
B April 1, 2018 36 9,576
C August 1, 2019 12 8,424

The total premium for each policy was paid in full (for all months) at the purchase date, and the Prepaid Insurance account was debited for the full cost. (Year-end adjusting entries for Prepaid Insurance were properly recorded in all prior years.)

Required:
So what would my adjusting journal entry be?

Answers

Answer:

Adjusting Journal in the year of payment:

December, 2017: Policy A

Debit Insurance Expense $4,059

Credit Prepaid Insurance $4,059

To record the insurance expense for the year (9 months).

December, 2018: Policy A and B

Policy A:

Debit Insurance Expense $5,412

Credit Prepaid Insurance $5,412

To record insurance expense for the year, 12 months.

Policy B:

Debit Insurance Expense $2,394

Credit Prepaid Insurance $2,394

To record insurance expense for the year, 9 months.

December, 2019:

Policy A:

Debit Insurance Expense $1,353

Credit Prepaid Insurance $1,353

To record insurance expense for the year, 3 months.

Policy B:

Debit Insurance Expense $3,192

Credit Prepaid Insurance $3,192

To record insurance expense for the year, 12 months.

Policy C:

Debit Insurance Expense $3,510

Credit Prepaid Insurance $3,510

To record insurance expense for the year, 5 months.

Explanation:

a) Data and Calculations:

Policy  Date of Purchase  Months of       Cost   Monthly

                                          Coverage                    Cost  

A         April 1, 2017                24          $10,824      $451 ($10,824/24)

B         April 1, 2018                36              9,576    $266 ($9,576/36)

C         August 1, 2019            12              8,424    $702 ($8,424/12)

b) The insurance expenses recorded under the three policies have been determined using the monthly rates.  In each year, the months covered are taken into consideration when computing the insurance expense for the year.  In this way, only the expenses incurred for the period are accounted for, in accordance with the accrual concept of accounting.

Longmire & Sons made sales on credit to Alderman Sports totaling $500,000 on April 18. The cost of the goods sold is $400,000. Longmire estimates 3% of its sales to Alderman may be returned. On May 22, $9,000 worth of goods (with a cost of $7,200) are returned by Alderman. Assume Longmire uses a perpetual inventory system.

Required:
Prepare the related journal entries for Longmire & Sons.

Answers

Answer:

April 18

Dr Account receivable 500,000

Cr Cash 500,000

April 18

Dr Cost of goods sold 400,000

Cr Merchandize inventory 400,000

May 22

Dr Sales return and allowance 9,000

Cr Account receivable 9,000

May 22

Dr Merchandize inventory 7,200

Cr Cost of goods sold 7,200

Explanation:

Preparation of the related journal entries for Longmire & Sons.

Based on the information given the related journal entries for Longmire & Sons will be :

April 18

Dr Account receivable 500,000

Cr Cash 500,000

(Being to record credit sales)

April 18

Dr Cost of goods sold 400,000

Cr Merchandize inventory 400,000

(Being to Record cost of goods sold)

May 22

Dr Sales return and allowance 9,000

Cr Account receivable 9,000

(Being to record goods return)

May 22

Dr Merchandize inventory 7,200

Cr Cost of goods sold 7,200

(Being to Record cost of goods return)

What type of hazard could occur by wearing jewelry while preparing food

Answers

Answer:

it can fall into the food

Kevin's boat was wrecked by hurricane Harvey (a federally declared natural disaster). Damage to the boat was estimated at $30,000. The original cost was $25,000. The boat was partially insured, and Kevin received an insurance reimbursement of $15,000. Kevin's adjusted gross income is $50,000, and he had no other losses during the year. What amount can Keith deduct on his tax return for this year

Answers

Answer:

A) $4,900

Explanation:

Options are: "A) $4,900 B) $5,000 C) $9,900 D) $14,900"

Particulars                                       Amount

Original cost                                    $25,000

Damage                                           $30,000

Lower of the two is                        $25,000

Less: Insurance reimbursement    $15,000

Actual loss                                       $10,000

Less: Deduction                               $100

Less: 10% of AGI (10% of 50,000)   $5,000

Final Deduction                               $4,900

Note: Flat $100 is deducted from this amount and also 10% of AGI, i.e 10% of $50,000 is deducted to finally arrive at the deduction.

a) Calculate the PV of a perpetuity with a cash flow of $111,111 received every year. The first cash flow occurs in year 1. The interest rate is 11% simple annual rate. b) Calculate the PV of a perpetuity with a cash flow of $222,222 received every second year. The first cash flow occurs in year 2. The interest rate is 11% simple annual rate. c) Calculate the PV of a perpetuity with a cash flow of $333,333 received every third year. The first cash flow occurs in year 3. The interest rate is 11% simple annual rate.

Answers

Answer:

a) Calculate the PV of a perpetuity with a cash flow of $111,111 received every year. The first cash flow occurs in year 1. The interest rate is 11% simple annual rate.

PV of a perpetuity = annual payment / interest rate = $111,111 / 11% = $1,010,100

b) Calculate the PV of a perpetuity with a cash flow of $222,222 received every second year. The first cash flow occurs in year 2. The interest rate is 11% simple annual rate.

PV of a perpetuity = annual payment / interest rate = $222,222 / (11% x 2) = $1,010,100

c) Calculate the PV of a perpetuity with a cash flow of $333,333 received every third year. The first cash flow occurs in year 3. The interest rate is 11% simple annual rate.

PV of a perpetuity = annual payment / interest rate = $333,333 / (11% x 3) = $1,010,100

Explanation:

Since the interest rate is simple, not compounded, the three perpetuities have the same present value.

Over the past decade, many American candy companies have opened factories in Mexico and Canada to produce candy. The companies, including Hershey Company, Brach's Confections, and Ferrara Pan, then ship candy back to the United States for sale. Although lower wages in Mexico might explain part of this move, wages in Canada are comparable to U.S. wages. Price floors (price supports) for the sugar industry encouraged American candy companies to move production out of the United States. Describe how the enactment of a sugar price floor impacted the market for candy in the United States, resulting in the movement of manufacturing.

Answers

Answer:

The sugar industry in the US is very powerful and has been able to establish trade barriers and import quotas that affect domestic prices. Sugar prices in the US are extremely high compared to prices in any other country, including Canada, Mexico, China, European nation, i.e. American sugar is the most expensive in the world.

Besides imposing trade barriers, the government also imposes a binding price floor. Binding price floors always result in deadweight losses since the quantity demanded is lower than equilibrium. This is why American candy manufacturers move their production overseas. the highest cost in the candy industry is actually sugar, and wherever they decide to relocate their factories it will always be cheaper.

Because your patented Gidgit is starting to gain attention and investors are starting to show interest, the executive committee is considering becoming a publicly held company by selling the company to the government.
True
False

Answers

Answer:

False.

Explanation:

Patent can be defined as the exclusive or sole right granted to an inventor by a sovereign authority such as a government, which enables him or her to manufacture, use, or sell an invention for a specific period of time.

Generally, patents are used on innovation for products that are manufactured through the application of various technologies.

Basically, the three (3) main ways to protect an intellectual property is to employ the use of trademarks, copyright and patents.

In this scenario, Because your patented Gidgit is starting to gain attention and investors are starting to show interest, the executive committee is considering becoming a publicly held company.

Since Gidgit is patented it cannot be sold to the government because it is a registered intellectual property that cannot be used or sold without the approval or consent of the owner.

Conrad, Inc. recently lost a portion of its records in an office fire. The following information was salvaged from the accounting records.
Cost of Goods Sold $ 65,000
Work-in-Process Inventory, Beginning 10,500
Work-in-Process Inventory, Ending 9,000
Selling and Administrative Expense 15,000
Finished Goods Inventory, Ending 15,000
Finished Goods Inventory, Beginning?
Direct Materials Used ?
Factory Overhead Applied 12,000
Operating Income 14,000
Direct Materials Inventory, Beginning 11,000
Direct Materials Inventory, Ending 6,000
Cost of Goods Manufactured 60,000
Direct labor cost incurred during the period amounted to 1.5 times the factory overhead. The CFO of Fisher, Inc. has asked you to recalculate the following accounts and to report to him by the end of the day. What is the amount of direct materials used?

Answers

Answer:

See below

Explanation:

Direct materials used = Cost of goods manufactured - work in process inventory, beginning - factory overhead applied - direct labor + work in process inventory, ending

= $60,000 - $10,500 - $12,000 - (1.5 × $12,000) + $9,000

=

The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitable parcel located farther from residential areas. Tinsley carried the land at its original cost of $62,500. According to an independent appraisal, the land currently is worth $150,000. Tinsley paid $25,000 in cash to complete the transaction. Required: 1. What is the fair value of the new parcel of land received by Tinsley assuming the exchange has commercial substance

Answers

Answer:

$175,000

Explanation:

When an exchange transaction has commercial substance, the accounting standard IAS 16 requires that the cost price of the item acquired be at fair Value of the asset given up.

Fair Value of Asset given up is $150,000.

However Tinsley has also paid a trade -in allowance for the new parcel of land of $25,000.

Therefore, the fair value of the new parcel of land received by Tinsley assuming the exchange has commercial substance is $175,000 ($150,000 + $25,000)

Fran Bowen created the following budget: Budget Food $ 364 Clothing $ 164 Transportation 408 Personal expenses and recreation 307 Housing 994 She actually spent $331 for food, $416 for transportation, $1,046 for housing, $161 for clothing, and $259 for personal expenses and recreation. Calculate the variance for each of these categories, and indicate whether it was a deficit or surplus.

Answers

Answer:

Fran Bowen

Budget Vs Actual, Variance and Status:

                                                      Budget     Actual   Variance  Status

Food                                                $ 364     $331         $33        Surplus

Clothing                                               164       161              3        Surplus

Transportation                                   408       416            -8        Deficit

Personal expenses and recreation  307      259           48        Surplus

Housing                                             994    1,046          -52       Deficit

Total                                             $2,237  $2,213         $24       Surplus

Explanation:

a) Data and Calculations:

                                                      Budget     Actual   Variance  Status

Food                                                $ 364     $331         $33        Surplus

Clothing                                               164       161              3        Surplus

Transportation                                   408       416            -8        Deficit

Personal expenses and recreation  307      259           48        Surplus

Housing                                             994    1,046          -52       Deficit

Total                                             $2,237  $2,213         $24       Surplus

b) The difference between the estimated budget cost and the actual cost spent on each item gives rise to either surplus or deficit.  This surplus or deficit is described as the variance.  It is surplus when the budgeted cost is greater than the actual cost spent.  It is deficit when the budgeted cost is less than the actual cost spent.

Great Harvest Bakery purchased bread ovens from New Morning Bakery. New Morning Bakery was closing its bakery business and sold its two-year-old ovens at a discount for $700,000. Great Harvest incurred and paid freight costs of $35,000, and its employees ran special electrical connections to the ovens at a cost of $5,000. Labor costs were $37,800. Unfortunately, one of the ovens was damaged during installation, and repairs cost $5,000. Great Harvest then consumed $900 of bread dough in testing the ovens. It installed safety guards on the ovens at a cost of $1,500 and placed the machines in operation.
Prepare a schedule showing the amount at which the ovens should be recorded in Great Harvest's Equipment account.

Answers

Answer:

Particulars                                  Amount

Purchase price                         $700,000

Add: Freight cost                     $35,000

Add: Electrical connections    $5,000

Add: Labor costs                      $37,800

Add: Bred dough used            $900

Add: Safety guards                  $1,500

Total cost of Equipment         $780,200

Note: Repairs cost of $5,000 will not be included

Mohawk Machining, which uses a process-costing system, adds material at the beginning of production and incurs conversion cost evenly throughout manufacturing. The following selected information was taken from the company's accounting records: Total equivalent units of materials: 8,000 Total equivalent units of conversion: 7,400 Units started and completed during the period: 6,500 On the basis of this information, the ending work-in-process inventory's stage of completion is:_____.
A- 80%.
B- 70%.
C- 60%. - 40%.
D- some other percentage not listed above.

Answers

Answer:

C. 60%

Explanation:

Equivalent unit of Materials = 8,000.00      

Equivalent unit of Conversion = 7,400.00      

Units started and completed = 6,500.00

Since Materials are entered in the beginning it means that out of 8000 Units of Materials 6500 units are in Units started and completed and remaining 1500 Units are in Closing inventory. It also means that 1500 units are in Closing Inventory of Conversion and Equivalent production of conversion part of 1500 Units are 900 Units (7400-6500).

Let % Completion be x      

X% of 1500 = 900      

X = 900*100/1500      

X = 60%.

in 2001 an outbreak of hoof-and-mouth disease in europe led to the burning of millions of cattle carcasses. discuss the demand and supply implication caused by the outbreak, for an in-depth analysis of the discussion topic you may use all of the resources available to you. what impact would you expect on the supply of cattle hides, hide prices, the supply of leather goods, and the price of leather goods

Answers

Answer:

High demand

Low supply

High prices

Explanation:

The demand and supply of products, goods and services is heavily dependent on several factors ranging from economic, health and social factors. Disease and viral outbreaks have devastating effects on the market forces of demand and supply which in most cases will impact the market negatively with characteristically high prices and scarcity of products. The mouth and hoof outbreak in Europe was one which impacted the economy including farmers, leather and hides workers and all whose businesses and sustainability depends on cattles and its products. Due to the contagious nature of the disease and the ease at which it could spread if curtailment isn't effected on time, millions of cattles were slaughtered on sighting the symptoms and it's products including skins are burnt leading to losses in billions on the path of cattle rearers, shortage of lather, hides and skins, restriction in international product trade in other to avoid its spread to other parts of the world. These resulted in low supply and high demand of cattles and its products including leather goods meaning High prices for little available.

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