Answer and Explanation:
For calculating the average of the monthly productivity, first, we have to determine the total hours, and then units per machine hours
Therefore, the formula to figure out the total hours is
= Hours per machine × Number of machines
For JAN = 325 × 3 = 975 hours
For FEB = 200 × 5 = 1,000 hours
For MAR = 400 × 4 = 1,600 hours
For APR = 320 × 4 = 1,280 hours
Now, the units per machine hours equivalent to
= Units produced ÷ total hours
For JAN = 2,300 units ÷ 975 hours = 2.36
For FEB = 1,800 units ÷ 1,000 hours = 1.8
For MAR = 2,800 units ÷ 1,600 hours = 1.75
For APR = 3,000 units ÷ 1,280 hours = 2.34
Now, the average of the monthly productivity equals to
= (2.36 + 1.8 + 1.75 + 2.34) ÷ 4
= 2.06 units per machine hour
Boyd Docker has just rented space in a strip mall. In this space, he will open a photography studio, to be called SnapShot! A friend has advised Boyd to set up a double-entry set of accounting records in which to record all of his business transactions.
Indicate whether the normal balance of each account is a debit or credit. Balance Cash select between debit and credit Supplies select between debit and credit Notes Payable select between debit and credit Equipment select between debit and credit Accounts Payable select between debit and credit Common Stock select between debit and credit
Answer and Explanation:
The normal balance of each account is a debit or credit is shown below:-
Accounts Normal balance Reason
Cash Debit Being an asset
Supplies Debit Being an asset
Note payable Credit Being a liability
equipment Debit Being an asset
accounts payable Credit Being a liability
common stock Credit Being an equity account
Therefore as per the balance sheet cash, supplies and equipment are the normal debit balance of assets while notes payable, accounts payable and common stock are the normal credit balance of liabilities on the balance sheet.
Preparing Closing Procedures The adjusted trial balance of Parker Corporation, prepared December 31, 2018, contains the following selected accounts. Adjusted Account Balances Debit Credit Service fees revenue $92,500 Interest income 2,200 Salaries expense $41,800 Advertising expense 4,300 Depreciation expense 8,700 Income tax expense 9,900 Retained earnings 42,700 a. Prepare entries to close these accounts in journal entry form. General Journal Description Debit Credit 12/31 Answer Service fees revenue Answer 92,500 Answer 0 Answer Answer 2,200 Answer 0 Answer Retained earnings Answer 0 Answer 92,500 To close the revenue accounts. 12/31 Answer Salaries expense Answer 0 Answer 0 Answer Prepaid advertising Answer 0 Answer 0 Answer Answer 0 Answer 0 Answer Answer 0 Answer 0 Answer Answer 0 Answer 0 To close the expense accounts. b. Post the closing entries to the appropriate T-accounts and calculate the ending balances for each account. Retained Earnings Bal. 42,700 Answer 0 Answer 0 Bal. Answer 0 Answer 0 Service Fees Revenue Bal. 92,500 Answer 0 Answer 0 Bal. Answer 0 Answer 0 Interest Income Bal. 2,200 Answer 0 Answer 0 Bal. Answer 0 Answer 0 Salaries Expense Bal. 41,800 Answer 0 Answer 0 Bal. Answer 0 Answer 0 Advertising Expense Bal. 4,300 Answer 0 Answer 0 Bal. Answer 0 Answer 0 Depreciation Expense Bal. 8,700 Answer 0 Answer 0 Bal. Answer 0 Answer 0
Answer:
Parker Corporation
a) Closing Journal Entries:
General Journal
Description Debit Credit
12/31
Service fees revenue $92,500
Interest income 2,200
Retained earnings 42,700
Income Summary $137,400
To close credit items to the Income Summary.
Income Summary $64,700
Salaries expense $41,800
Advertising expense 4,300
Depreciation expense 8,700
Income tax expense 9,900
To close debit items to the Income Summary.
b. T-accounts:
Debit Credit
Service fees revenue
Adjusted balance $92,500
Income Summary $92,500
Balance $0
Interest income
Adjusted balance $2,200
Income Summary $2,200
Balance $0
Salaries expense
Adjusted balance $41,800
Income Summary $41,800
Balance $0
Advertising expense
Adjusted balance $4,300
Income Summary $4,300
Balance $0
Depreciation expense
Adjusted balance 8,700
Income Summary $8,700
Balance $0
Income tax expense
Adjusted balance 9,900
Income Summary $9,900
Balance $0
Retained earnings
Adjusted Balance 42,700
Income Summary $42,700
Balance $0
Explanation:
a) Data:
Parker Corporation
Adjusted Account Balances
Debit Credit
Service fees revenue $92,500
Interest income 2,200
Salaries expense $41,800
Advertising expense 4,300
Depreciation expense 8,700
Income tax expense 9,900
Retained earnings 42,700
Amul Food Factory in India makes ice cream and produces processed and condensed milk. In the factory, the firm's employees use raw milk and sugar. The firm runs on electricity and purchases raw milk every day. Large robotic assembly lines fill and package the ice cream containers. Large industrial freezers store the ice cream. Based on this scenario, can you identify the fixed costs for Amul Food Factory?
a) the cost of raw milk purchased from the farmersb) the cost of building the factory, purchasing the robotic assembly lines and industrial freezersc) the cost of the employees hired and the number of packages purchasedd) the cost of purchasing electricity, raw milk, and sugar
Answer:
Option B
Explanation:
In simple words, Fixed cost refers to an expenditure which does not adjust due to a rise or reduction in the volume of products or services generated or distributed. Fixed costs include bills that tend to be incurred by a corporation, irrespective of any particular market operation.
Fixed expenditures may be overt or indirect expenditures that may also have an bearing on revenue at various points throughout the financial statements. Thus, from the above we can conclude that the correct option is B.
Glade Company leases computer equipment to customers under direct financing leases. The equipment has no residual value at the end of the lease term, and the leases do not contain bargain purchase options. Glade wishes to earn 8% interest on a five-year lease of equipment with a fair value of $323,400. Use tables (PV of 1, PVAD of 1, and PVOA of 1) (Use the appropriate factor(s) from the tables provided.) Required:
Compute the total amount of interest revenue that Glade will earn over the life of the lease. (Round your intermediate and final answers to 2 decimal places.)
Answer:
$51,588.70
Explanation:
The computation of the total amount of interest revenue is shown below:-
Annual lease payments = Fair value of Equipment ÷ PV factor of $1 annuity due
= $323,400 ÷ (1 + (1 - (1.08)^-4) ÷ 0.08)
= $323,400 ÷ 4.31213
= $74,997.74
Now,
Total interest revenue = Gross lease payments receivable - Fair value
= $74,997.74 × 5 - $323,400
= $374,988.70 - $323,400
= $51,588.70
hich of the following statements is true? The denominator used in computing earnings per share represents the shares of common stock outstanding on the last day of the accounting period. Net income is not adjusted when computing earnings per share. Earnings per share is an internal measure and is not used by stockholders. By comparing earnings per share of a single corporation over time, a stockholder can evaluate the corporation’s relative earnings performance.
Answer:
By comparing earnings per share of a single corporation over time, a stockholder can evaluate the corporation’s relative earnings performance.
Explanation:
Earnings per share are often part of a corporation's financial statement. Since the shareholder of the corporation usually has a share or interest in the performance of the companythe relative earnings performance of the corporation can be estimated by comparing the earnings per share of the corporation over time.so correct answer is By comparing earnings per share of a single corporation over time, a stockholder can evaluate the corporation’s relative earnings performance.Indicate the financial statement on which each of the following items appears. Use I for income statement, E for statement of retained earnings, and B for balance sheet.a. Services Revenueb. Interest Payablec. Accounts Receivabled. Salaries Expensee. Equipmentf. Prepaid Insuranceg. Buildingsh. Rental Revenuei. Dividendsj. Office Suppliesk. Interest Expensel. Insurance Expense
Answer:
a. Services Revenue: I
b. Interest Payable: B
c. Accounts Receivable: B
d. Salaries Expense: I
e. Equipment: B
f. Prepaid Insurance: B
g. Buildings: B
h. Rental Revenue: I
i. Dividends: E
j. Office Supplies: B
k. Interest Expense: I
l. Insurance Expense: I
Explanation:
Financial statements can be defined as a document used for the formal communication or disclosure of financial information and statements to present and potential users such as investors and creditors. These includes balance sheet, statement of retained earnings and income statement.
a. Services Revenue: Income statement.
b. Interest Payable: Balance sheet.
c. Accounts Receivable: Balance sheet.
d. Salaries Expense: Income statement.
e. Equipment: Balance sheet.
f. Prepaid Insurance: Balance sheet.
g. Buildings: Balance sheet.
h. Rental Revenue: Income statement.
i. Dividends: Statement of retained earnings.
j. Office Supplies: Balance sheet.
k. Interest Expense: Income statement.
l. Insurance Expense: Income statement.
When an accelerated depreciation method is used to calculate depreciation expense: Multiple Choice the accumulated depreciation account balance will increase by a larger amount in the last half of an asset's life than if straight-line depreciation is used. the net book value of the asset halfway through its useful life will be less than if straight-line depreciation is used. the net book value of the asset at the end of its useful life will be less than if straight-line depreciation is used. depreciation expense will be less in the early years of the asset's life than if straight-line depreciation is used.
Answer:
the net book value of the asset halfway through its useful life will be less than if straight-line depreciation is used.
Explanation:
Let me use an example to illustrate this.
An asset has a useful life of 4 years. It costs $1000. It has a salvage value of 0
If the straight line depreciation method is used , the depreciation expense every year = $1000/ 4 = $250
The net book value halfway through its useful life = $1000 - ($250 x 2) = $500
If double declining method is used, the depreciation expense in the first year would be = 2/4 x $1000 = $500
The net book value at the beginning of year 2 = $1000 - $500 = $500
Depreciation expense in year 2 = 2/4 x $500 = $250
The net book value at the beginning of year 3 = $500 - $250 = $250
We can see that the net book value halfway through the useful is lower when double declining depreciation method is used
Scrooge, Inc. prepares adjusting entries only at the end of its fiscal year, August 31. Scrooge has the following unadjusted account balances at August 31. Accounts payable $300 Cash $6,100 Common stock $1,500 Prepaid rent $3,600 Service revenue $5,000 Rent expense $800 Retained earnings $300 Unearned revenue $4,000 Wages expense $600 The following facts are available for the fiscal period: The current pay period concludes on Sept. 8th, when the employee will be paid his wages of $180. The employee earns $100 before August 31st and the rest between Sept. 1st and Sept. 8th. On July 1st, Scrooge paid $3,600 to cover its rent for the next six months. On May 1st, Scrooge collected $4,000 in advance for services to be performed in the future. Scrooge completed 80% of this work before the end of the fiscal year. What net income should Scrooge report for the fiscal year
Answer:
$6,100
Explanation:
The computation of the net income is shown below:
= Service revenue in trial balance + ( unearned revenue × given percentage) - (rent expense in trial balance) + ( Prepaid rent × 2 months ÷ 12 months) - (wages expense in trial balance + adjusted trial balance)
= $5,000 + ($4,000 × 80%) - ($800 + $3,600 × 2 months ÷ 12 months - ($600 + $100)
= $5,000 + $3,200 - $1,400 - $700
= $6,100
Do you agree with the flowing statements? Businesses should do anything they can to make a profit. Use specific reasons and examples to support your position.
Answer:
Yes , I do agree with the statement "businesses should do anything they can to make a profit" I agree with this because in order to make money The business has to make profit. if they don't it could lead up to them losing the business from bankruptcy.
Which of the following activities is a way that retailers help to lower the cost
of distribution?
A. Combining shipments of products
B. Making the shopping environment fun
C. Teaching customers about products
D. Accepting many forms of payment
Answer:
combining shopmente6of prod6
Answer:A. Combining shipments of products
Explanation: Just had this and got it right
Department G had 3,600 units, 40% completed at the beginning of the period, 12,000 units were completed during the period, 2,000 units were 20% completed at the end of the period, and the following manufacturing costs were debited to the departmental work in process account during the period: Work in process, beginning of period $ 60,000 Costs added during period: Direct materials (10,400 at $9.8365) 102,300 Direct labor 79,800 Factory overhead 25,200 Assuming that all direct materials are placed in process at the beginning of production and that the first-in, first-out method of inventory costing is used, the equivalent units for materials and conversion costs, respectively, are
Answer:
Equivalent Units Materials 10400
Equivalent Units Conversion 10960
Cost Per Equivalent Unit Materials $9.8365
Cost Per Equivalent Unit D. Labor $ 7.2810
Cost Per Equivalent Unit FOH $ 2.2992
Explanation:
Particulars Units % of Completion Equivalent Units
Materials Conversion Materials Conversion
Complete 12000 100 100 12000 12000
Add EWIP 2000 100 20 2000 400
Less BWIP 3600 100 40 3600 1440
Equivalent Units 10400 10960
In FIFO as the name suggests we take out the units first completed. So we deduct the Beginning Work in Process (BWIP) from the sum of completed units and ending work in process (EWIP).
Costs added during period: Direct materials Direct labor Factory overhead
(10,400 at $9.8365)
102,300 79,800 25,200
Equivalent Unit 10400 10960 10960
Cost Per Equivalent Unit $9.8365 7.2810 2.2992
Gale Corporation manufactures windsocks. The business recently decided to adopt an ABC system. The following activities have been identified: Activity Cost Driver Chosen as Allocation Base Conversion Cost Per Unit of Allocation Base Materials handling Number of parts $1.00 Machining Machine hours 60.00 Packaging Number of finished units 2.00 EaEach windsock requires three parts and spends five minutes in the machining department. The total cost of direct materials and direct labor is $3.50 per windsock. Gale produces 20,000 windsocks each year and sells them at 140% of cost. 7. The total cost of producing the 20,000 windsocks is: A. $160,000. B. $230,000. C. $270,000. D. $1,260,000.
Answer:
$270,000
Explanation:
The first step is to calculate the overhead cost of the material handling parts
Since each wind stock require 3 parts then the overhead cost can be calculated as follows
= 3 × 20,000
= 60,000
The overhead cost of machining hours can be calculated as follows
Since 5 minutes is spent in the machining department then overhead cost is
= 5× 20,000
= 100,000
The overhead cost of packaging number of finished units can be calculated as follows
= 2 × 20,000
= 40,000
Total overhead cost= 100,000 + 60,000 + 40,000
= 200,000
The total cost of direct materials and labor can be calculated as follows
= 3.5 × 20,000
= 70,000
Therefore the total cost of producing 20,000 windstocks is
= Total overhead cost + total cost of direct materials and labor
= 200,000 + 70,000
= $270,000
Hence the total cost of producing 20,000 windstocks is $270,000
Barry Company has a calendar year-end. On December 15, Year 1, a customer was injured using a product manufactured by Barry. That customer files a lawsuit against Barry on January 15, Year 2. On February 15, Year 2, Barry’s attorney advises Barry to settle the claim for $100,000 because a loss in that amount is probable and material. Barry has not yet distributed its Year 1 financial statements. What must Barry do with regards to those financial statements?
Answer:
Record the loss contingency in the December 31, Year 1, balance sheet and also disclose the lawsuit in the footnotes.
Explanation:
Since the loss is both probable and material, then it must be recorded as a liability in the balance sheet. This is a loss contingency, and depending on whether the probability of occurrence is probable, possible or not possible, and the amount can be determined, then it will be recorded in the balance sheet, included in the footnotes or not considered.
Since the loss is probable and it can be quantified, plus the incident occurred during last year, then the loss contingency must be included as a liability. The company should also disclose the lawsuit in the footnotes.
Ms. Frank is planning for a 25-year retirement period and wishes to withdraw a portion of her savings at the end of each year. She plans to withdraw $10 000 at the end of the first year, and then to increase the amount of the withdrawal by $1000 each year, to offset inflation. How much money should she have in her savings account at the start of the retirement period, if the bank pays (a) 9'10, (b) 7:%, per year, compounded annually
Answer:
I guess the interest rates are 9.10% and 7% per year.
a) $173,369.67
b) $217,212.31
Explanation:
the total distributions received by Ms. Frank are:
year distribution
1 10000
2 11000
3 12000
4 13000
5 14000
6 15000
7 16000
8 17000
9 18000
10 19000
11 20000
12 21000
13 22000
14 23000
15 24000
16 25000
17 26000
18 27000
19 28000
20 29000
21 30000
22 31000
23 32000
24 33000
25 34000
Using excel, I calculated the present value of this annuity using the different discount rates (using present value function)
a) $173,369.67
b) $217,212.31
A consumer products company found that % of successful products also received favorable results from test market research, whereas % had unfavorable results but nevertheless were successful. That is, P(successful product and favorable test market) and P(successful product and unfavorable test market). They also found that % of unsuccessful products had unfavorable research results, whereas % of them had favorable research results, that is P(unsuccessful product and unfavorable test market) and P(unsuccessful product and favorable test market). Find the probabilities of successful and unsuccessful products given known test market results, that is, P(successful product given favorable test market), P(successful product given unfavorable test market), P(unsuccessful product given favorable test market), and P(unsuccessful product given unfavorable test market).
Answer:
P(successful product given favorable test market) = 77.19%
P(successful product given unfavorable test market) = 22.81%
P(unsuccessful product given favorable test market) = 25.58%
P(unsuccessful product given unfavorable test market) = 74.42%
Explanation:
the information is incomplete since it is missing the numbers:
"A consumer products company found that 44% of successful products also received favorable results from test market research, whereas 13% had unfavorable results but nevertheless were successful. That is, P(successful product and favorable test market) = 0.44 and P(successful product and unfavorable test market) = 0.13. They also found that 32% of unsuccessful products had unfavorable research results, whereas 11% of them had favorable research results, that is P(unsuccessful product and unfavorable test market) = 0.32 and P(unsuccessful product and favorable test market) = 0.11."
probability of being successful and having favorable test market results = 44%
probability of being successful and having unfavorable test market results = 13%
probability of not being successful and having unfavorable test market results = 32%
probability of not being successful and having favorable test market results = 11%
probability of being successful = 44% + 13% = 57%
probability of not being successful = 32% + 11% = 43%
probability of being successful given favorable test market = 44% / 57% = 0.7719 = 77.19%
probability of being successful given unfavorable test market = 13% / 57% = 0.22819 = 22.81%
probability of not being successful given favorable test market = 11% / 43% = 0.2558 = 25.58%
probability of not being successful given unfavorable test market = 32% / 43% = 0.7442 = 74.42%
ABC Retail stocks and sells its own brand of personal computers. It costs the firm $600 each time it places an order with a manufacturer for computers. The cost of carrying one computer in inventory for one year is $225. The store manager estimates the total annual demand for computers will be 2,000 units with a constant demand rate throughout the year. ABCs policy is never to have stockout of the store brand TV. The store is open for business seven days per week from 9 AM to 6 PM. Determine the time between orders TBO (in working days)
Answer:
18 days
Explanation:
first we must determine the economic order quantity:
EOQ = √[(2 x S x D) / H]
S = order cost = $600D = annual demand = 2,000H = holding cost = $225EOQ = √[(2 x 600 x 2,000) / 225] = 103.28 units ≈ 103 units
total number of orders = 2,000 / 103 = 19.4175
Time between orders = working days per year / total number of orders = 365 / 19.4175 = 18.7975 days
since the company's policy is to never run out of stock, then we should round down the time between orders to 18 days. If we round up to 19 days (which is much closer actually), the risk of an stock out exists.
114.8Magnolia Manufacturing Corporation uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Last year, the Corporation worked 20,200 actual direct labor-hours and incurred $142,500 of actual manufacturing overhead cost. They had estimated at the beginning of the year that 17,600 direct labor-hours would be worked and $140,800 of manufacturing overhead costs incurred. The Corporation had calculated a predetermined overhead rate of $8 per direct labor-hour. The Corporation's manufacturing overhead for the year was: Multiple Choice overapplied by $1,700 underapplied by $19,100 underapplied by $1,700 overapplied by $19,100
Answer:
overapplied by $19,100
Explanation:
The calculation of manufacturing overhead for the year is shown below:-
Manufacturing overhead cost applied = Actual direct labor hours × Predetermined overhead rate
= 20,200 × $8
= $161,600
Manufacturing overhead for the year = Actual overhead - Applied overhead
= $142,500 - $161,600
= $19,100 overapplied
So, for determining the manufacturing overhead for the year we simply applied the above formula.
For every decision you make there is a trade off
Answer:
True
Explanation:
I took the test on edge
An all-equity new firm is developing its business plan. It will require $615,000 of assets (which equals common equity), and it projects $450,000 of sales and $355,000 of operating costs for the first year. Management is reasonably sure of these numbers because of contracts with its customers and suppliers. It can borrow at a rate of 7.5%, but the bank requires it to have a TIE of at least 4.0. The firm will use debt and common equity for financing. What is the maximum debt to capital ratio (measured as debt/total common equity) the firm can use? (Hint: Find the maximum dollars of interest, then the debt that produces that interest, and then the related debt to capital ratio.)
Answer:
51.49%
Explanation:
An all equity new firm is developing its business plan
It will require assets of $615,000
The firm projects $450,000 of sales and $355,000 of operating costs for the first year
The first step is to calculate the EBIT
EBIT= sales - operating costs
= $450,000-$355,000
= $95,000
The interest can be calculated as follows
Interest= EBIT/TIE
= 95,000/4
= $23,750
Since the bank can borrow loan at the rate of 7.5% them the debt is
= 23,750/7.5/100
= 23,750/0.075
= $316,666.7
Therefore the maximum debt to capital ratio can be calculated as follows
= 316,666.7/615,000 × 100
= 0.5149 × 100
= 51.49%
Hence the maximum debt to capital ratio is 51.49%
The pollution prevention act 1990 established source reduction as the preferred approach to environmental protection
Answer:
True
Explanation:
The statement “The pollution prevention act 1990 established source reduction as the preferred approach to environmental protection” is true. Thus, option A is correct.
What is pollution?The entrance of hazardous substances into the environment is called pollution. pollution can be man-made or made by nature. like the pollution created by volcanoes, ash is natural pollution and the pollution made by burning some sort of chemical and plastic is man-made. Pollution has an adverse effect on living as well as nonliving things.
The pollution prevention act was launched in 1990 to make sure that the level of pollution that was made was to be reduced to a significant amount and various measures were taken to ensure the same as installing air and water filters, bans on various things, etc. Therefore, option A is the correct option.
Learn more about pollution, here:
https://brainly.com/question/15708835
#SPJ6
The question is incomplete, the complete question is :
The pollination prevention Act 1990 established source reduction as the preferred approach to environmental protection.
A) True
B) False
A new building is to be constructed for a company and a fast connection between client and server systems within the building should be achieved. As well as the fastest possible connection between the new building and the old building. The new building is also not allowing wireless devices within it for security purposes. What networking components should one consider to achieve what the company wants if a medium sized budgetary constraint was put in place for the new building?
Options:
Category 6 cable runs for each network device with fiber optic feeds in/out of the buildings.Numerous 802.11b wireless access points along with category 5 cable runs between hubs and buildings. Fiber Optic connections to all network device s, e.g. clients and servers. Coaxial cable to all devices on the network with a fiber-optic feed in/out of the office.Answer:
Category 6 cable runs for each network device with fiber optic feeds in/out of the buildings.
Explanation:
Remember, we are told to consider the fact that the company has a medium-sized budgetary constraint, meaning we should pick an alternative networking component option that is cost-effective and yet serves the same purpose.
Since part of the requirements is that the networking components is a fast connection between client and server systems, a Category 6 (Cat6) cable has the ability to achieve speeds of up to 10 Gbps (Gigabyte per second). Meaning? it can meet the fast connection requirements at a reduced cost.
You need a 25-year, fixed-rate mortgage to buy a new home for $240,000. Your mortgage bank will lend you the money at a 8.6 percent APR for this 300-month loan. However, you can afford monthly payments of only $800, so you offer to pay off any remaining loan balance at the end of the loan in the form of a single balloon payment. Required: How large will this balloon payment have to be for you to keep your monthly payments at $800?
Answer:
the balloon payment after 300 months is $1,205,266.38
Explanation:
In order to pay the loan completely after 300 months, your monthly payment should be $1,948.75. Since you can only pay $800 per month, the loan's balance after 300 payments will be $1,205,266.38. This is irrational since you will end up owing 4 times the initial amount. You will never even be close to paying even the interest expense, so the principal increases every month.
I prepared an amortization schedule using an excel spreadsheet
Parker & Stone, Inc., is looking at setting up a new manufacturing plant in South Park to produce garden tools. The company bought some land six years ago for $4.4 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent these facilities from a competitor instead. If the land were sold today, the company would net $4.7 million. The company wants to build its new manufacturing plant on this land; the plant will cost $11.9 million to build, and the site requires $710,000 worth of grading before it is suitable for construction. What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project? (Enter your answer in dollars, not millions of dollars, e.g. 1,234,567.) Cash flow amount $
Answer:
$17,310,000
Explanation:
Land purchased for use as warehouse and distribution site = $4.4 million(6 years ago)
Current market value of land = $4.7 million
For determining the initial investment in fixed assets for the plant, the current value of the land will have to be taken (as Parker and Stone would have had to buy land at this price for the plant, if the land was not already with it).
The amount spent on land will not be treated as sunk costs as this amount is not permanently lost. The company can recover money by selling the land. So the current market value will be included in the initial investment in fixed assets in reference to the project.
So, proper cash flow for the project = Site grading costs +Plant cost + Current market value of land
= $710,000 + $11.9 million + $4.7 million
= $17,310,000
Hence, $17,310,000 is the amount of initial investment in fixed assets to be used when evaluating this project.
Belsky Corporation has provided the following data from its activity-based costing system: Activity Cost Pools Estimated Overhead Cost Expected Activity Assembly $ 974,440 68,000 machine-hours Processing orders $ 95,300 2,000 orders Inspection $ 133,000 1,900 inspection-hours The company makes 450 units of product Q19S a year, requiring a total of 710 machine-hours, 42 orders, and 12 inspection-hours per year. The product's direct materials cost is $35.79 per unit and its direct labor cost is $29.53 per unit. According to the activity-based costing system, the unit product cost of product Q19S is closest to: (Round your intermediate calculations to 2 decimal places.)
Answer:
Unitary cost= $94.24
Explanation:
First, we need to calculate the predetermined overhead rate for each department:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Assembly= 974,440/68,000= $14.33 per machine-hour
Processing= 95,300/2,000= $47.65 per order
Inspection= 133,000/1,900= $70 per inspection
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Assembly= 14.33*710= $10,174.3
Processing= 47.65*42= $2,001.3
Inspection= 70*12= $840
Total overhead= $13,015.6
Unitary overhead= 13,015.6/450= $28.92
Finally, the unitary cost:
Unitary cost= 35.79 + 29.53 + 28.92
Unitary cost= $94.24
Penn Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 1: Units Unit Cost Inventory, December 31, prior year For the current yea 2,000 $5 Purchase, March 21 Purchase, August 1 5,000 3,000 4,000 Inventory, Decmber 31, current year
Required: Compute ending inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost inventory costing methods
FIFO LIFO Average Cost
Ending inventory
Cost of goods sold
Answer and Explanation:
The computation is shown below:-
Units sold = Opening balance + Purchase in march + Purchase in August - Closing balance
= 2,000 + 5,000 + 3,000 - 4,000
= 6,000
1. FIFO method:
So total cost of goods sold is (2000 × $5) + (4,000 × $6)
= $34,000
Ending inventory value is
= (1000 × 6) + (3000 × $8)
= $30,000
2. LIFO method:
Total value of goods sold is
= (3,000 × $8) + (3,000 × $6)
= $42,000
Ending inventory value is
(2,000 × 6) + (2000 × $5)
= $22,000
3. Average cost of inventory
Opening inventory + Purchase on Mar.21 + Purchase on Aug.1
(2,000 × $5) + (5000 × $6) + (3000 × 8)
= $64,000.
Total units is
= 2,000 + 5,000 + 3,000
= 10,000
Average cost is
= $64,000 ÷ 10,000
= $6.40 per units.
Now,
Cost of goods sold is 6,000 × $6.40
= $38,400
Ending Inventory value is
= 4,000 × $6.40
= $25,600
The computation of the ending inventory and the cost of goods sold for the year under the three inventory costing methods is as follows:
FIFO LIFO WEIGHTED-AVERAGE
Ending inventory $22,000 $27,000 $24,400
Cost of goods sold $39,000 $34,000 $36,600
Data and Calculations:
Units Unit Cost Total Costs
December 31, Inventory 2,000 $5 $10,000
March 21 Purchase 5,000 $6 $30,000
March 21 Purchase 3,000 $8 $21,000
Total 10,000 $61,000
Average cost per unit = $6.10 ($61,000/10,000)
December 31, Inventory 4,000
Units sold = 6,000 (10,000 - 4,000) units
FIFO:
Ending inventory = $22,000 (2,000 x $6 + 2,000 x $5)
Cost of goods sold = $39,000 ($61,000 - $22,000)
LIFO:
Ending inventory = $27,000 (1,000 x $6 + 3,000 x $8)
Cost of goods sold = $34,000 ($61,000 - $27,000)
Weighted Average:
Ending inventory = $24,400 (4,000 x $6.10)
Cost of goods sold = $36,600 (6,000 x $6.10)
Learn more: https://brainly.com/question/14121444
Required information
Use the following information below. [The following information applies to the questions displayed below.]
Carmen Camry operates a consulting firm called Help Today, which began operations on August 1. On August 31, the company’s records show the following selected accounts and amounts for the month of August.
Cash $ 25,460
Dividends $ 6,130
Accounts receivable 22,510
Consulting fees earned 27,130
Office supplies 5,380
Rent expense 9,690
Land 44,130
Salaries expense 5,710
Office equipment 20,160
Telephone expense 1,010
Accounts payable 10,370
Miscellaneous expenses 620
Common stock 103,300
Preparing a statement of retained earnings LO P3 Use the above information to prepare an August statement of retained earnings for Help Today. The Retained Earnings account balance at August 1 was $0. Hint: Net income for August is $10,100.
Answer:
Income Statement
Consulting fee earned $27,130
Total Revenue $27,130
Expenses
Rent expenses $9,690
Salaries expense $5,710
Telephone expenses $1,010
Miscellaneous Expenses $620
Total Expenses $17,030
Net Income $10,100
Retained Earning Statement
For the Month Ended August 31
Retained earning August 1 -
Net Income $10,100
$10,100
Dividend $6,130
Retained earning August 31 $3,970
James, Inc., has purchased a brand new machine to produce its High Flight line of shoes. The machine has an economic life of 5 years. The depreciation schedule for the machine is straight-line with no salvage value. The machine costs $540,000. The sales price per pair of shoes is $77, while the variable cost is $29. Fixed costs of $245,000 per year are attributed to the machine. The corporate tax rate is 22 percent and the appropriate discount rate is 9 percent. What is the financial break-even point? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16)
Answer:
3,074 units sold or total revenue of $236,698 per year
Explanation:
cost of machine $540,000
depreciation expense per year = $540,000 / 5 = $108,000
contribution margin per unit sold = $77 - $29 = $48
we generally calculate the financial break even point of a business by using the following formula:
= EBIT × (1 - interest expense) × (1 - tax rate) - preferred dividends
But when we are dealing with projects, the financial break even point is the sales level at which the project's NPV = $0. If the sales level is lower, then the project will be rejected, and if the sales level is higher, then it should be accepted.
using an annuity formula, the free cash flow per year needed for the NPV = $0 is $540,000 / 3.8897 (PV annuity factor, 9%, 5 periods) = $138,828.19
$138,828.19 = {[(unit sales x $48) - $108,000] x 0.78} + $108,000
$30,828.19 = [(unit sales x $48) - $108,000] x 0.78
$39,523.32 = (unit sales x $48) - $108,000
$147,523.32 = unit sales x $48
unit sales = $147,523.32 / $48 = 3,073.40 units ≈ 3,074 units sold
After reading this chapter, it isn't surprising that you're becoming an investment wizard. With your newfound expertise, you purchase 100 shares of KSU Corporation for $31.17 per share. Assume the price goes up to $40.07 per share over the next 12 months and you receive a qualified dividend of $0.41 per share. What would be your total return on your KSU Corporation investment? Assuming you continue to hold the stock, calculate your after-tax return. How is your realized after-tax return different if you sell the stock? In both cases assume you are in the 25 percent federal marginal tax bracket and 15 percent long-term capital gains and qualified dividends tax bracket and there is no state income tax on investment income.
Answer:
before-tax 29.87%
after-tax 26.37%
Explanation:
The return will be the capital gain and the dividend gain.
capital gain: ending market price - purchase price
$ 40.07 - $ 31.17 = $ 8.90
dividend gain: $0.41
total return: $8.90 + $0.41 = $9.31
investment: $ 31.17
rate of return before-tax: 9.31 / 31.17 = 0,29868 = 29.87%
return after tax:
dividends 0.41 x ( 1 - 0.25) = 0.3075
capital gain: (as we hold the share we can use long.term capital gain rate
9.31 x ( 1 - 0.15) = 7,9135
total return: 7.9135 + 0.3075 = 8.221
rate of return after-tax 8.221 / 31.17 = 0,2637471928136 = 26.37%
Roquan, a single taxpayer, is an attorney and practices as a sole proprietor. This year, Roquan had net business income of $90,000 from his law practice (net of the associated for AGI self-employment tax deduction). Assume that Roquan pays $40,000 in wages to his employees, has $10,000 of property (unadjusted basis of equipment he purchased last year), and has no capital gains or qualified dividends. His taxable income before the deduction for qualified business income is $100,000. (Leave no answer blank. Enter zero if applicable.) Required: Calculate Roquan’s deduction for qualified business income. Assume the same facts provided above, except Roquan’s taxable income before the deduction for qualified business income is $300,000.
Answer:
a) Calculate Roquan’s deduction for qualified business income.
qualified business deduction:
20% of qualified business income AND less than 20% of total incomeSince Roquan is a single filer, his AGI cannot exceed $213,300.Roquan's QBI deduction = 20% x QBI = 20% x $90,000 = $18,000
b) Since Roquan's income is higher than $213,300, then he is not allowed any QBI deduction.
You are the IT director at Attaway Airlines, a small regional air carrier. You chair the company's systems review committee, and you currently are dealing with strong disagreements about two key projects. The marketing manager says it is vital to have a new computerized reservation system that can provide better customer service and reduce operational costs. The vice president of finance is equally adamant that a new accounting system is needed immediately because it will be very expensive to adjust the current system to new federal reporting requirements. The VP outranks the marketing manager, and the VP is your boss. The next meeting, which promises to be a real showdown, is set for 9:00 am tomorrow. How will you prepare for the meeting
Explanation:
Been the IT director at Attaway Airlines, it will be important to prepare a draft of the advantages and the level of difficulties the new computerized reservation system from an IT perspective.
However, the ultimate goal is not to simply win arguments, but to explain and consider the facts from both the Vice president of finance and the Marketing Manager.
