Answer:
$191,000.00
Explanation:
The cash amount of cash collected from customers is the amount of sales revenue in the year 2018 adjusted for changes in accounts receivable balances as shown by the formula below:
cash collected from customers=sales revenue+begining accounts receivable-ending accounts receivable
sales revenue=$202,000
the begining accounts receivable=$16,500
the ending accounts receivable=$27,500
It is expected that cash received would be sales less the increase in accounts receivable
cash collected from customers=$202,000+$16,500-$27,500
cash collected from customers=$191,000.00
Market efficiency implies no mispricing and therefore all stocks must earn zero return in such condition. True or false? Explain.
Explain how a consumer’s place of residence has an especially large impact on their purchase of sports and entertainment commodities.
Answer:
A consumers place of residence has a large impact on their purchase because of how they live in that area and their community.
Explanation:
Example, if you live in New York City, marketers probably will not target you as much to purchase their four wheeler as they would someone who lives in the country.
Swifty Design was founded by Thomas Grant in January 2011. Presented below is the adjusted trial balance as of December 31, 2020.
SWIFTY DESIGN
ADJUSTED TRIAL BALANCE
DECEMBER 31, 2020
Debit Credit
Cash $11,210
Accounts Receivable 21,710
Supplies 5,210
Prepaid Insurance 2,710
Equipment 60,210
Accumulated Depreciation-Equipment $35,210
Accounts Payable 5,210
Interest Payable 168
Notes Payable 5,600
Unearned Service Revenue 5,810
Salaries and Wages Payable 1,416
Common Stock 10,210
Retained Earnings 3,710
Service Revenue 61,710
Salaries and Wages Expense 11,510
Insurance Expense 966
Interest Expense 518
Depreciation Expense 7,600
Supplies Expenses 3,400
Rent Expense 4,000
1) Prepare an income statement for the year ending December 31, 2020, Statement of Retained Earnings, Balance Sheet and
2) If the note has been outstanding 6 months, what is the annual interest rate on that note?
3) If the company paid $17,500 in salaries and wages in 2014, what was the balance in Salaries and Wages Payable on December 31, 2013?
Answer:
Swifty Design
1. Income Statement for the year ended December 31, 2020:
Service Revenue $61,710
Salaries and Wages Expense 11,510
Insurance Expense 966
Interest Expense 518
Depreciation Expense 7,600
Supplies Expenses 3,400
Rent Expense 4,000 $27,994
Net income $33,716
b) Statement of Retained Earnings for the year ended December 31, 2020:
Retained Earnings, January 1, 2020 $3,710
Net income 33,716
Retained Earnings, December 31, 2020 $37,426
c) Balance Sheet as of December 31, 2020:
Assets
Current assets:
Cash $11,210
Accounts Receivable 21,710
Supplies 5,210
Prepaid Insurance 2,710
Total current assets $40,840
Long-term assets:
Equipment 60,210
Accumulated depreciation 35,210 $25,000
Total assets $65,840
Liabilities + Equity:
Liabilities:
Accounts Payable $5,210
Interest Payable 168
Notes Payable 5,600
Unearned Service Revenue 5,810
Salaries and Wages Payable 1,416
Total liabilities $18,204
Equity:
Common Stock $10,210
Retained Earnings 37,426 $47,636
Total liabilities + equity $65,840
2. The annual interest would be $518 according to accrual basis of accounting.
3. If the company paid $17,500 in salaries and wages in 2014 (2020), the balance in Salaries and Wages Payable on December 31, 2013(2019) was $7,406.
Explanation:
SWIFTY DESIGN
ADJUSTED TRIAL BALANCE
DECEMBER 31, 2020
Debit Credit
Cash $11,210
Accounts Receivable 21,710
Supplies 5,210
Prepaid Insurance 2,710
Equipment 60,210
Accumulated Depreciation-Equipment $35,210
Accounts Payable 5,210
Interest Payable 168
Notes Payable 5,600
Unearned Service Revenue 5,810
Salaries and Wages Payable 1,416
Common Stock 10,210
Retained Earnings 3,710
Service Revenue 61,710
Salaries and Wages Expense 11,510
Insurance Expense 966
Interest Expense 518
Depreciation Expense 7,600
Supplies Expenses 3,400
Rent Expense 4,000
Totals $129,044 $129,044
Salaries and Wages:
Wages payable, 12/31/2019 $7,406
Salaries expense 11,510
Cash paid in 2020 17,500
Wages Payable, 12/31/2020 $1,416
Discuss the entrepreneurial management demands?
Answer:
Entrepreneurial management varies from managing established corporations.
Explanation:
Entrepreneurs must manage the affairs of a startup giving attention to all of the new paperwork filings (ig. Filing corporate charter, articles of incorporation, business license, dba, etc) in a timely manner while getting their new business off the ground. In addition to these tasks, the demands of managing everyday business still scream for attention.
The entrepreneurial demands are the concerns that affect managers of businesses. Some of them include;
Establishing the visions and goals of the business, putting a strategy in place to grow, obtaining capital and funding for the business, acquiring the right human resources to run the business, and setting up a good organizational structure.To run a business effectively, entrepreneurs have several demands of the business that they must settle. Some of these include;
The vision and goals of the business: Putting this in place helps the business to always stay on track and stick to its goals.Business strategy: To stand out from their competition, a strategy ought to be established.Funding: No business runs without money. The entrepreneur must always evaluate the important resources that should be financed to run effectively.Human resources: The right and qualified people should be employed to help in running the business.Organizational Structure: The managers, accountants, assistants, etc., must be drawn up in a good organizational structure profile. This will help people to know their seniors and subordinates and address matters accordingly.Learn more here:
https://brainly.com/question/21012374
Rihanna Company is considering purchasing new equipment for $450,000. It is expected that the equipment will produce net annual cash flows of $60,000 over its 10-year useful life. Annual depreciation will be $45,000. Compute the cash payback period
Answer:
7.5 years
Explanation:
Payback is the period a project takes to recover its initial capital outflow.
The formula for calculating the payback period = Initial investments divide by net cash flow per period.
Payback Period = Initial Investments/ Net Cash Flow per Period
Payback period = $450,000/ $60,000
Payback period =7.5 years
Crystal Industries is considering an expansion project with cash flows of -$325,000, $167,500, $216,100, $104,500, and -$92,700 for years 0 through 4. Should the firm proceed with the expansion based on the discounting approach to the modified internal rate of return if the discount rate is 13.4 percent
Answer:
Crystal Industries
NPV = $7,1005.51
The firm should proceed with the expansion because the project will yield a positive net present value.
Explanation:
a) Data and Calculations:
Discount rate = 13.4%
Discount factor = 1/(1 + r)∧n
Calculation of the Net Present Value:
Years Cash flows Discount Factor Present value
0 -$325,000 1 -$325,000.00
1 $167,500 0.8818 147,701.50
2 $216,100 0.7776 168,039.36
3 $104,500 0.7001 73,160.45
4 -$92,700 0.6174 -56,800.80
NPV = $7,100.51
b) Crystal's net present value (NPV) is the difference between the present value of its cash inflows and the present value of its cash outflows over the project's 4 years. The NPV is usually determined in capital budgeting and investment planning as a financial evaluation tool when analyzing the positivity of a project's cash flows. It discounts the future cash flows to today's dollar values, taking into consideration the time value of money.
a. Complete the following table: Answer the marginal revenue.
Instructions: Enter your responses rounded to the nearest whole number. Indicate a negative response with a (-) negative sign.
Price $24 $21 $18 $15 $12 $9 $6 $3
Quantity Demanded 1 2 3 4 5 6 7 8
Marginal Revenue $ $ $ $ $ $ $ $
b. At what rate of output does marginal revenue turn negative?
c. If marginal cost is constant at $12, what is the profit-maximizing rate of output?
d. Assuming a firm has monopoly power, what price should be charged at that rate of output? $_____
Answer:
a)
Price $24 $21 $18 $15 $12 $9 $6 $3
Quantity Demanded 1 2 3 4 5 6 7 8
Marginal Revenue $24 $18 $12 $6 $0 -$6 -$12 -$18
b) marginal revenue turns negative at 6 units
c) 5 units, since profits are maximized when MC = MR
d) $12, again profits are maximized when MC = MR
For each of the following transactions, determine if Raymond Corporation has earned revenue during the month of May and, if so, how much it has earned.
Customers paid Raymond $1,500 for work Raymond will perform in June.
Customers purchased $6,000 of inventory for which they have not yet paid.
Raymond performed work for customers and was paid $3,400 in cash.
Customers paid Raymond $2,300 for inventory purchased in April.
Record the journal entries for number 2 above.
Answer and Explanation:
As per the question, the journal entry for number 2 is as follows:
Accounts Receivable $6000
To Sales $6,000
(Being revenue earned is recorded)
Here account receivable is debited as it increased the assets and credited the sales as it increased the revenue
Ye the revenue is earned for $6,000
(9782)
कीजिए।
b) Dr. Sapna got her MBBS degree. As she is going to start a profession, she should be aware of
the feature of Profession. What features of profession she should know?
(Lesson 2)
Answer:
As she is going to start a profession, she should be aware of the feature of Profession and features of profession she should know is explained below in detail.
Explanation:
A profession is described as obtaining high expertise in a certain discipline and working to develop all that field for the well-being of the earth.
As Doctor Sapna is about to operate for the well-being of all the people. She should have fascinating of the following characteristics of professionalism, such as:
Practical experienceAccountabilityWell trained in all the technical toolsNo discretion is choosing the patientsDirect work relationshipEthical constraintsGreat responsibilityMerit-basedMoral in workingis it true or false that the socioeconomic model of social responsibility emphasizes the effort of business decisions on society
Answer:
I pretty sure it's true
Explanation:
hope this helps
Consolidation among fuel providers serving airport facilities is viewed in the five forces model of competition as a(n): a. reduction of the airlines' ability to benefit from economies of scale. b. increase in switching costs because the airlines have no choice but to use jet fuel and other oil products. c. increase in the bargaining power of suppliers of a critical input. d. increase in the intensity of rivalry among airlines for scarce resources.
Answer:
c: increase in the bargaining power of suppliers of a critical input
Explanation:
Five Forces Framework by Porter's can be regarded as a method involving analysis of competition in a business. It's analysis dream through
industrial organization economics determine forces that are responsible for competitive intensity. The forces are;
✓potential new market entrants
✓number and power of a company's competitive rivals
✓ influence of suppliers, customers,on company's profitability.
It should be noted that Consolidation among fuel providers serving airport facilities is viewed in the five forces model of competition as a increase in the bargaining power of suppliers of a critical input.
Splish Brothers Inc. reported a net loss of $14400 for the year ended December 31, 2022. During the year, accounts receivable decreased $33600, inventory increased $24000, accounts payable increased by $36000, and depreciation expense of $28800 was recorded. During 2022, operating activities:_____.
a. used net cash of $17,000.
b. used net cash of $29,000.
c. provided net cash of $24,000.
d. provided net cash of $21,000.
Damien Carranza is a nonexempt employee of Verdant Enterprises where he is a salesperson, earning a base annual salary of $31,750 plus a 3 percent commission on all sales during the pay period. During the weekly pay period ending August 25, Damien closed $26,400 in sales and worked 4 hours overtime.
Required:
What is his gross pay for the period? (Do not round your intermediate calculations. Round your final answers to 2 decimal places.)
Gross pay
Answer:
Damien Carranza
Gross pay = $1.494.17
Explanation:
a) Data and Calculations:
Base annual salary = $31,750
Weekly base hours = 40 hours
We assume that there are 52 weeks in a calendar year.
Hourly rate = $31,750/(52 weeks * 40 hours) = $15.26442 per hour
Overtime worked = 4 hours
Overtime rate = 4 * $31,750/2,080 * 1.5 = $91.59
Weekly base pay = 40 * $31,750/2,080 = 610.58
Commission = $26,400 * 3% = 792.00
Gross pay = $1,494.17
b) Since Damien is a non-exempt employee, he is entitled to earn the federal minimum wage and qualify for overtime pay. This is calculated as one-and-a-half times his hourly rate, for every hour worked above and beyond the standard 40-hour workweek. The gross pay is Damien's total earnings throughout the week before deductions for mandated taxes, health insurance, retirement, and Medicare contributions are made.
Tasty Subs acquired a delivery truck on October 1, 2021, for $21,500. The company estimates a residual value of $2,500 and a six-year service life. It expects to drive the truck 100,000 miles. Actual mileage was 5,000 miles in 2021 and 19,000 miles in 2022.
Required:
Calculate depreciation expense using the activity-based method for 2018 and 2019, assuming a December 31 year-end.
Answer:
The depreciation expenses will be "950 and 3610". A further explanation is given below.
Explanation:
The given values are:
Cost,
= $21,500
Salvage value,
= $2,500
Asset's total life,
= $100,000
Now,
The Depreciation rate will be:
= [tex]\frac{ (Cost - Salvage \ value) }{Asset's \ total \ life}[/tex]
On putting the values, we get
= [tex]\frac{ (21500 - 2500) }{100000}[/tex]
= [tex]\frac{19000}{100000}[/tex]
= [tex]0.19[/tex]
So,
For the year 2021, the depreciation expense will be:
= [tex]Depreciation \ Rate\times Actual \ Mileage[/tex]
= [tex]0.19\times 5000[/tex]
= [tex]950[/tex]
For the year 2022, the depreciation expense will be:
= [tex]Depreciation \ Rate\times Actual \ Mileage[/tex]
= [tex]0.19\times 19000[/tex]
= [tex]3610[/tex]
Teams occur when a number of people have --------------- and recognise that their personal success is dependent on the success of others
Not sure what the options for the answer are (if there are any), but an appropriate entry in this box is "common goals," among other answers. Please let me know if you have any questions and provide me with the answer options if there are any.
You note the following yield curve in The Wall Street Journal. According to the unbiased expectations theory, what is the one-year forward rate for the period beginning two years from today, 3f1? (Do not round intermediate calculations. Round your answer to 2 decimal places. (e.g., 32.16)) Maturity Yield One day 1.58 % One year 2.10 Two years 2.34 Three years 2.45
Answer:
2.58%
Explanation:
Mathematically, the relationship between the different interest rates using the equation is shown below:
(1+S2)^2=(1+S1)^1*(1+2y1y)
The spot rate in year 2 is the same as the spot rate in year 1 multiplied by the 1-year forward rate beginning in year 2.
S2=2-year rate =2.34%
S1=1-year rate =2.10%
2y1y=one-year interest rate 2 years from now=the unknown
(1+2.34%)^2=(1+2.10%)^1*(1+2y1y)
(1+2y1y)=(1+2.34%)^2/(1+2.10%)^1
2y1y)=(((1+2.34%)^2/(1+2.10%)^1)-1
2y1y=1.025805642-1
2y1y= 2.58%
The formula shows that borrowing or lending for 2 years at 2.34% is the same as borrowing or lending at 2.10% in year and 2.58% forward rate in year 2
anyone pls give me a buisenss plan pls I really don't have a time to do it
Answer:
Explanation:
1.Start up business plan
startup businesses draft a business plan for three specific reasons: to articulate their vision for the business, to document how they plan to solve key challenges, and to pitch their business idea to potential investors.
2. Internal Business plan
This document will describe the company's current state, including operational costs and profitability, then calculate if and how the business will repay any capital needed for the project. Internal plans provide information about project marketing, hiring and tech costs.
3. Strategic Business plan
A strategic plan for a business will include the company's mission and vision statement, as well as its goals and objectives and the action plans to achieve them. ... A strategic plan outlines the strategy for growth and success in the future by using existing resources.
4. Feasibility business plan
A feasibility business plan is a study conducted prior to initiating a business plan. Whether you're an established business launching a new product or an individual with a new idea, a feasibility plan is that part of a business plan that will help you and your investors determine if your idea will thrive.
5. Operation business plan
Operational planning is the process of planning strategic goals and objectives to technical goals and objectives.
6. Growth business plan
Business growth plans are short-term outlines for where a company sees itself in the next one to two years. ... A business growth plan is beneficial to a company as a whole, but the main purpose is to write it with investors in mind. Investors want an outline of how your company plans to build sales in the coming months.
please help me.......
1. PUBLIC AFFAIR OFFICER
2. CHAMBER OF COMMERCE OFFICER
3. TAX AUDITOR
4. DISPATCHER
The following table describes the production possibilities of two cities in the country of Baseballia:
Pairs of Red Socks per Worker per Hour Pairs of White Socks per Worker per Hour
Boston 3 6
Chicago 5 4
Without trade, the price of a pair of white socks (in terms of red socks) in Boston is_______ of red socks, and in Chicago it is ___________ of red socks. _________has an absolute advantage in the production of red socks, and _________ has an absolute advantage in the production of white socks. ___________has a comparative advantage in the production of red socks, and______ has a comparative advantage in the production of white socks.
If the cities trade with each other, Boston will export _________socks, and Chicago will export _________socks.
The price of white socks can be expressed in terms of red socks. The highest price at which white socks can be traded that would make both cities better off is _________of red socks per pair of white socks, and the lowest price that makes both cities better off is ________of red socks per pair of white socks.
Answer:
All the blanks are filled with explanation below.
Explanation:
Solution:
Let's extract the meaning of data from the data given.
Boston produces 3 red socks per worker per hour and 6 white socks per worker per hour
B = 1 worker = 1 hour = produces 3 pairs Red Socks
B = 1 worker = 1 hour = produces 6 pairs white socks
Boston = whites socks in terms of red socks
6 white socks = 3 red socks
white socks = 3/6 red socks
white socks = 0.5 pairs of red socks.
Chicago = white socks in terms of red socks
4 white socks = 5 red socks
white socks = 5/4 red socks
white socks = 1.25 red socks
C = 1 worker = 1 hour = produces 5 pairs Red socks
C = 1 worker = 1 hour = produces 4 pairs white socks
It means in Boston, we have advantage of producing white socks and in Chicago we have advantage of producing red socks.
Fill in the blanks: (Note: Bold words are blanks filled)
1. The price of pair of white socks (in terms of red socks) in Boston is 0.5 pairs of red socks of red socks, and in Chicago it is 1.25 red socks of red socks.
2.Chicago has an absolute advantage in the production of red socks, and Boston has an absolute advantage in the production of white socks.
3. Chicago has a comparative advantage in the production of red socks, and Boston has a comparative advantage in the production of white socks.
4. If the cities trade with each other, Boston will export white socks, and Chicago will export red socks.
5. The price of white socks can be expressed in terms of red socks. The highest price at which white socks can be traded that would make both cities better off is 1.25 of red socks per pair of white socks, and the lowest price that makes both cities better off is 0.5 of red socks per pair of white socks.
Consider the following events: Scientists reveal that eating oranges decreases the risk of diabetes, and at the same time, farmers use a new fertilizer that makes orange trees produce more oranges. What are the net effects on the equilibrium price and quantity of oranges?
a. An increase in the price of oranges, the change in equilibrium quantity is uncertain.
b. A decrease in the price of oranges, the change in equilibrium quantity is uncertain.
c. An increase in the equilibrium quantity of oranges, the change in equilibrium price is uncertain.
d. A decrease in the equilibrium quantity of oranges, the change in equilibrium price is uncertain.
Answer:
The net effects on the equilibrium price and quantity of oranges are:
c. An increase in the equilibrium quantity of oranges, the change in equilibrium price is uncertain.
Explanation:
The promotion of the eating of oranges by Scientists will increase the demand for oranges. This increased demand will shift the equilibrium quantity of oranges demanded by consumers. With the use of the new fertilizer by farmers to increase the production of oranges, the equilibrium quantity of supply will shift with demand. However, it is uncertain, from the data provided, if the equilibrium price will upward or downward. This will depend on other market forces, e.g. the market competitiveness.
Merchandise inventory includes:__________
a. costs to purchase
b. costs to sell
c. shipping costs
d. costs to prepare for sale
e. cost of goods sold
Answer:
a. costs to purchase
c. shipping costs
d. costs to prepare for sale
Explanation:
Merchandise inventory is a commodity offered for sale. It is the cost of goods that is readily available at hand which is ready for sale From the options; the Merchandise inventory includes: costs to purchase, shipping costs and costs to prepare for sale.
The remaining options are addressed in the income statement.
Diaz and Associates incurred the following costs in completing a tax return for a large company. Diaz applies overhead at 50% of direct labor cost. Labor Hours Used Hourly Rate Partner 5 $ 500 Senior manager 12 200 Staff accountants 100 50 1. Prepare journal entries to record direct labor and the overhead applied.
Answer:
1. Dr Services in process inventory9,900
Cr Service salaries payable9,900
Dr Services in process inventory4,950
Cr Services overhead4,950
2. Dr Cost of services provided14,850
Cr Services in process inventory14,850
Explanation:
1.Preparation of journal entries to record direct labor andthe overhead applied.
Dr Services in process inventory9,900
Cr Service salaries payable9,900
[(5 × $500) + (12 × $200) + (100 × $50) = $9,900]
Dr Services in process inventory4,950
Cr Services overhead4,950
($9,900 x 50% = $4,950)
2.Preparation of the journal entry to record the cost of services provided.
Dr Cost of services provided14,850
Cr Services in process inventory14,850
($9,900+$4,950=14,850)
[(5 × $500) + (12 × $200) + (100 × $50) = $9,900]
+($9,900 x 50% = $4,950)
Jpmorgan chase operates outside of the united states explain how it competes and its strategy in one specifi country?
In Brazil, Chase's strategy is to focus on providing competitive online solutions, moving away from physical banks.
This is usually a written description of the objectives to be achieved, with a brief statement of the work to be done and a proposed schedule specifying the start and completion dates.
a. Work breakdown structure
b. Task Project milestone
c. Statement of work
d. Work package
Answer:
c. Statement of work
Explanation:
Statement of work is usually a written description of the objectives to be achieved, with a brief statement of the work to be done and a proposed schedule specifying the start and completion dates.
This ultimately implies that, it is a written document that provides detailed information about set objectives and goals to be achieved by a business firm or company. It is essentially important for the growth and development of a business.
Taylor Company received a gift of land and building from the town of Saunderstown as an inducement to relocate there. The land and buildings have fair values of $39,000 and $395,000. Prepare the appropriate journal entry for this transaction.
Answer:
See below
Explanation:
The donation will increase the assets and the owners' equity. Land and building are assets. An increase in assets is debited.
Donations received are equivalent to 'income' to the business. They add to equity. An increase in equity/capital accounts is credited.
The journal entry will be
Land A/c DR. $39,000
Building A/c DR.$395,000
Donations received A/c CR.$434,000
How does international trade affect the lives of U.S. citizens?
Answer:
The short answer is - A lot!
Explanation:
According to the U.S Chamber of Commerce, the population of the U.S. is just 5% of that of the rest of the world and the only way to raise real wages within the U.S. is to reach out to that other 95% with its own products and services.
To put that in perspective, there are over forty million jobs in the U.S. all of which depend directly or indirectly on trade. In 2019 alone, the U.S. recorded approximately USD 1.4 trillion in exports of its own manufactured goods. According to the U.S. Department for Commerce, in the same year, the above-mentioned export activity accounted for at least 6 million jobs within the manufacturing sector in the U.S. and this is just U.S. manufacturing versus international trade.
Taking a look at Services exported from the U.S. in 2019, we see that services worth about USD 850 billion were exported. This makes America the largest exporter of services to the world.
Let's imagine for a moment, that that didn't exist?
We have looked at exports thus far. However, there is also a flip side of the coin called international trade and that is imports. No country is 100% self-sufficient to the point that they have a comparative advantage in every area hence the need for international trade.
The U.S. economy has a Free Trade Agreement with over 20 countries. Statistics also show that more than 60% of all raw material inputs are imported.
We can thus conclude that International Trade is key to attaining and sustaining the American Dream.
Cheers
whats the difference between elastic and inelastic in business
Answer:
Elastic demand means there is a substantial change in quantity demanded when another economic factor changes typically the price of the good or service, whereas inelastic demand means that there is only a slight or no change in quantity demanded of the good or service when another economic factor is changed.
Explanation:
Hope this helps
From,
1kvibing
Which of the following will cause the supply curve to move outward all else being equal
Classify each of the following costs as a period cost or a product cost. If you classify the cost as a product cost, further classify it as direct material (DM), direct labor (DL), or manufacturing overhead (MOH). (If the cost is a period cost, leave t classification box empty: do not select a label.)
Period cost If product cost
or product cost DM, DL or MOH
a1. Property taxes-30% of building is used for sales, marketing, and administrative offices
a2. Property taxes-70% of building is used for manufacturing
b. Wages and benefits paid to assembly-line workers in the manufacturing plant
c. Depreciation on automated production equipment
d. Salaries paid to quality control inspectors in the plant
e. Repairs and maintenance on factory equipment
f. Standard packaging materials used to package individual units of product for sale (for example, cereal boxes in which cereal is packaged) g. Lease payment on administrative headquarters
h. Telecommunications costs for the customer service cal center
Answer:
Classification of costs as period cost or product cost
a1. Property taxes is 30% period cost
a2. Property taxes is 70% product cost (MOH)
b. Wages and benefits to factory workers = product cost (DL)
c. Depreciation on production equipment = product cost (MOH)
d. Salaries to quality control inspectors in the plant = product cost (MOH)
e. Repairs and maintenance on factory equipment = product cost (MOH)
f. Standard packaging materials = product cost (MOH)
g. Lease payment on administrative headquarters = period cost
h. Telecommunication costs for customer service = period cost
Explanation:
Period costs are fixed costs incurred that relate more to the period in which they are incurred than to the product. They are not directly related to the product and are treated as expenses. Product costs, on the other hand, are costs incurred in producing the product. They may be in the form of direct materials, direct labor, or manufacturing overhead costs.
Presented below are selected account balances for Tamarisk Co. as of December 31, 2020.
Inventory 12/31/20 $60,770
Cost of Goods Sold $229,017
Common Stock 74,170
Selling Expenses 16,133
Retained Earnings 45,080
Administrative Expenses 37,525
Dividends 17,873
Income Tax Expense 30,300
Sales Returns and Allowanes
11,908
Sales Discounts 15,070
Sales Revenue 408,750
Prepare closing entries for Tamarisk Co. on December 31, 2020.
Answer and Explanation:
The closing entries for the following accounts are presented below:
1. Sales Revenue A/c Dr $408,750
To Income Summary $408,750
(Being revenue account closed)
2. Income summary A/c Dr $323,830
To Cost of Goods Sold $229,017
To Sales Returns and Allowances $11,908
To Sales Discounts $15,070
To Selling Expenses $16,133
To Administrative Expenses $37,525
To Income Tax Expense $30,300
(Being expenses accounts are closed)
3. Income summary A/c Dr $84,930 ( $408,750 - $323,830)
To Retained earning $84,930
(Being the difference is credited to retained earning)
4. Retained earnings A/c Dr $17,873
To Dividend A/c $17,873
(Being dividend account is closed)
