Answer:
sustained growth
Explanation:
Based on this information it seems that Barb's firm is experiencing sustained growth. This term refers to the realistically attainable amount of growth that a company can have without running into problems. If a business grows way too fast it will not be able to fund that growth, but if they do not grow enough then they will amass debt and fail. Sustainable Growth is usually the goal for new companies.
Forester Company has five products in its inventory. Information about the December 31, 2021, inventory follows. Product Quantity Unit Cost Unit Replacement Cost Unit Selling Price A 1,000 $ 26 $ 28 $ 32 B 500 31 27 34 C 900 19 18 24 D 900 23 20 22 E 800 30 28 29 The cost to sell for each product consists of a 10 percent sales commission. The normal profit for each product is 35 percent of the selling price. Required: 1. Determine the carrying value of inventory at December 31, 2021, assuming the lower of cost or market (LCM) rule is applied to individual products. 2. Determine the carrying value of inventory at December 31, 2021, assuming the LCM rule is applied to the entire inventory. 3. Assuming inventory write-downs are common for Forester, record any necessary year-end adjusting entry based on the amount calculated in requirement 2.
Answer:
A)
A 1,000 x $26.00 = $ 26,000
B 500 x $30.60 = $ 15,300
C 900 x $ 19.00 = $ 17,100
D 900 x $ 19.80 = $ 17,820
E 800 x $26.10 = $ 20,880
Total $ 97,100
B)
102,240
C)
Write-down at NRV 1,060 debit
Inventory 1,060 credit
Explanation:
We have to calculate the net realizable value(NRV) for each item and compare with the historic cost:
Units// Cost /// NRV
A 1,000 $ 26 $ 32(1 - 0.1) = 28.8
B 500 $ 31 $ 34(1-0.1) = 30.60
C 900 $ 19 $ 24(1-0.1) = 21.60
D 900 $ 23 $ 22(1-0.1) = 19.80
E 800 $ 30 $ 29(1-0.1) = 26.10
We will always pick the lowest to valuate the goods:
A 1,000 x $26.00 = $ 26,000
B 500 x $30.60 = $ 15,300
C 900 x $ 19.00 = $ 17,100
D 900 x $ 19.80 = $ 17,820
E 800 x $26.10 = $ 20,880
Total $ 97,100
Total Cost:
1,000 x 26
+ 500 x 31
+ 900 x 19
+ 900 x 23
+ 800 x 30
103,300
Total NRV
1,000 x 28.80
+ 500 x 30.60
+ 900 x 21.60
+ 900 x 19.80
+ 800 x 26.10
102,240
Comparing at the entire inventory level we get the following adjustment
103,300 - 102,240 = 1,060
Allowance for Doubtful Accounts has a debit balance of $441 at the end of the year (before adjustment), and Bad Debt Expense is estimated at 3% of sales. If net credit sales are $903,000, the amount of the adjusting entry to record the estimate of the uncollectible accounts is a.$26,649 b.$27,531 c.$27,090 d.$441
Answer: $27,090
Explanation:
From the question, we are informed that the allowance for doubtful accounts has a debit balance of $441 at the end of the year (before adjustment), and bad debt expense is estimated at 3% of sales and that the net credit sales are $903,000.
The amount of the adjusting entry to record the estimate of the uncollectible accounts will be 3% of $903,000. This will be:
= 3% × $903,000
= 3/100 × $903,000
= 0.03 × $903,000
= $27,090
The CEO has given her secretary this material for a memo, but it is highly un-organized. Rewrite the memo so that the main point is first, that the memo flows in a much more logical order. Delete information not relevant to the main idea. Use strong subjects and verbs -- in other words, employ the principles we talked about in the lesson on writing.
To employees at a call center
I’m hoping you can send out a memo for me to all phone operators. As you might or might not be aware of, we’ve had some problems lately with operators asking for breaks, or simply taking them, at all sorts of time during their shift. While we are happy to be flexible, we do have a job to do and must have a certain amount of operators manning the phones at all times. Several times the phones have rung and rung with not enough people to answer them. Several supervisors have complained to me that their people have argued with them about combining their breaks and meal break to get an hour at one time. I feel like I need to put my foot down so that each supervisor doesn’t have to make their own decision. We need to remind folks of our policy on breaks and meal breaks through the day. Remind telephone operators that they should take the two 15 minute breaks allotted to them generally about halfway through a four-hour work period. If they want or need to take a break during another time, they should talk with their supervisor. But let folks know this should be under extraordinary circumstances. Stress that these should be extraordinary circumstances so we can count on enough people to be on the phones through the day. Meal breaks should be taken roughly halfway through their shift, but they should be coordinated with their supervisor. Several times, we’ve lost folks we were counting on, only to find that they were on break. Phone operators can stay at their desks and work on personal business, or simply each lunch, as long as they are not tying up resources. We’d prefer, though, that they go to the break rooms or leave their cubicles. We don’t want people to create the perception that they’re doing personal tasks during work time. I often eat at my desk but of course I’m not salaried employee. Oh, and we don’t want folks saving up their breaks and leaving work early. We need to staff our phones from 8 a.m. to 8 p.m. Our staggered schedule allows us to do that, but not if folks create their own schedules. Do people have to take their breaks? Yes, they do -- federal law mandates it. So tell them they just can’t skip the breaks, though why they’d want to I don’t know. By the way, it looks like we’ll be hiring in the new fiscal year, as we go ahead with that expansion into the Southeast. Should be about 20 to 25 new phone operators.
Answer:
TO EMPLOYEES AT A CALL CENTER
It is my aim to send out a memo to you all phone operators. As you might or might not be aware of, we have faced series of problems lately with operators asking for breaks, or simply taking them without express permission which ended up clashing with their shift time for work. While we are happy to be flexible, we need to remind you of our policy on breaks and meal breaks through the day.
Most times,when a call came in, there will be no one to attend to it. Several supervisors have tabled the complaints of their team members, about combining their normal breaks and meal break in-order to get an hour at one time. Despite being a noble suggestion, the employees and their supervisor should remember that, the working condition was explicitly stated in the contract agreement they signed before taking this job.
In a situation were there is extraordinary condition, the call operators should liaised with their supervisor and discuss about the need to take extra break time. Meal breaks should be taken roughly halfway through their shift, which should be under strict coordination by their supervisor. Phone operators can stay at their desks and work on personal business, or simply each lunch, as long as they are not tying up resources.
We would prefer, though, that they go to the break rooms or leave their cubicles. We don’t want people to create the perception that they’re doing personal tasks during work time. We need to staff our phones from 8 a.m. to 8 p.m. Our staggered schedule allows us to do that, but not if folks create their own schedules. Do people have to take their breaks? Yes, they do -- federal law mandates it. By the way, it looks like we will be hiring in the new fiscal year, as we go ahead with that expansion into the Southeast. Should be about 20 to 25 new phone operators.
Explanation:
On July 1, 2021, a company loans one of its employees $20,000 and accepts a ten-month, 9% note receivable. Calculate the amount of interest revenue the company will recognize in 2021 and 2022
Answer:
Interest in 2021=900
Interest in 2022=600
Explanation:
Calculatation of the amount of interest revenue the company will recognize in 2021 2022
Month in 2021 - July To December
Interest in 2021 = 20,000*9%*6/12
Interest in 2021=900
Month in 2022 - January To April
Interest in 2022 = 20,000*9%*4/12
Interest in 2022=600
Therefore the amount of interest revenue the company will recognize in 2021 will be 900 while 2022 will be 600
Answer:
2021:900
2022:600
Explanation:
Month in 2021 - July To December
Interest in 2021 = 20,000x0.0%x(6/12)
Interest in 2021=900
Month in 2022 - January To April
Interest in 2022 = 20,000x0.09x(4/12)
Interest in 2022=600
Therefore the answer for 2021 will be 900 and for 2022 will be 600
The company estimates future uncollectible accounts. The company determines $14,000 of accounts receivable on January 31 are past due, and 30% of these accounts are estimated to be uncollectible. The remaining accounts receivable on January 31 are not past due, and 5% of these accounts are estimated to be uncollectible. (Hint: Use the January 31 accounts receivable balance calculated in the general ledger.) Record bad debts at the end of January.
Answer:
Bad debt expense = $4,690
Explanation:
Entry DEBIT CREDIT
Bad debt Expense $4,690
Allowance for doubtful debt $4,690
In Order to record bad debt expense, we need to go through some minor workings.
Workings
Receivables on January 31 past due = $14,000 x 30% = $4,200
Receivable not past due = ($14,000 x 70%) x5% = $490
Bad debt expense = Receivables on January 31 past due + Receivable not past due
Bad debt expense = $4,200 + $490
Bad debt expense = $4,690
Like a good economist, you calculated the opportunity cost of getting your college degree. Suppose that at your university, you will pay $10,000 each year for tuition, $2,500 each year for textbooks, and $12,000 per year for room and board. Before you left for college, your boss at your high-school job offered you a job paying $20,000 per year.
Assume that if you decided not to go to college, your parents would not let you live at home.
What is your opportunity cost for four years of college? $_______
Answer:
$130,000
Explanation:
Calculation for the opportunity cost for four years of college
The first step is to calculate for the cost of education per year
Using this formula
Cost of education per year =Tuition+Text book +Room and board
Let plug in the formula
Cost of education per year =$10,000+$2,500+$12,000
=$24,500
Second step is to calculate the return in a situation were we decided not to go to college
$20,000-$12,000=$8,000
The last step is to calculate for the opportunity cost for 4 years of college:
Using this formula
Opportunity cost =Cost of education per year+ Return * Numbers of year
Where,
Cost of education per year=$24,500
Return =$8,000
Numbers of years =4
Let plug in the Formula
Opportunity cost =($24,500+$8,000)*4
Opportunity cost =$32,500*4
Opportunity cost =$130,000
Therefore the opportunity cost for four years of college will be $130,000
intext:"The description of the relation between a company’s assets, liabilities, and equity, which is expressed as Assets = Liabilities + Equity, is known as the"
Answer:
Accounting equation
Explanation:
The accounting equation is the basis of the double-entry accounting system.
The accounting equation ensures that each entry made on the debit side of the balance sheet should have a corresponding entry on the credit side. This ensures that the balance sheet remains balanced
The Bank of Bramblewood would like to increase its loans to customers, but it is currently mandated by a high reserve rate. As a Federal Reserve member bank, it will borrow additional funds from the Fed and charge its customers an interest rate that is higher than the ________________.
Answer: discount rate
Explanation:
It should be noted that the discount rate is the rate that is charged by the Federal Reserve when any of its member banks borrow money from it.
Therefore, Federal Reserve member bank, the Bank of Bramblewood will borrow additional funds from the Fed and charge its customers an interest rate that is higher than the discount rate.
Harper Company lends Hewell Company $58,800 on March 1, accepting a four-month, 7% interest note. Harper Company prepares financial statements on March 31. What adjusting entry should be made before the financial statements can be prepared
Answer and Explanation:
The adjusting entry made is shown below:
Interest receivable Dr. $343 ($58,800 × 7% × 1 months ÷ 12 months)
To Interest revenue $343
(Being the interest receivable is recorded)
For recording this we debited the interest receivable as it increased the assets and credited the interest revenue as it also increased the revenue so that the proper journal entry entry is recorded and posting too
A 5-year corporate bond yields 7.0%. A 5-year municipal bond (tax exempt bond) of equal risk yields 5.0%. Assume that the state tax rate is zero. At what federal tax rate are you indifferent between the two bonds?
Answer:
The tax rate is approximately(rounded to a whole) 29%
Explanation:
The federal tax that would make an investor indifferent between the 5-year corporate bond and the 5-year municipal bond can be derived by equating the return on the former to the taxable return of the latter as below:
5%=7%*(1-t)
where the t is the unknown tax rate
Note that the return on 5-year corporate bond is taxable while the return on the municipal bond is tax-free
5%=7%*(1-t)
5%/7%=1-t
0.7143 =1-t
t=1-0.7143
t=29%
A job was timed for 60 cycles and had an average of 1.2 minutes per piece. The performance rating was 95%, and workday allowances are 10 percent. Determine each of the following:
a. Observed time.
b. Normal time.
c. Standard time.
Answer and Explanation:
The computation is shown below:
a) Observation time is
= Average time
= 1.2 minutes
b) The Normal time is
= Observation time × performance rating
= 1.2 minutes × 0.95
= 1.14 minutes
3. The standard time is
= normal time × Allowance factor
where,
Normal time is 1.14 minutes
And, the Allowance factor is
= 1 ÷ (1- A)
= 1 ÷ (1- 0.1)
= 1.11
So, the standard time is
= 1.14 × 1.11
= 1.265 minutes.
Health and Wealth Company is financed entirely by common stock that is priced to offer a 12 percent expected return. If the company repurchases 20 percent of the common stock and substitutes an equal value of debt yielding 8 percent, what is the expected return on the common stock after refinancing
Answer: 13%
Explanation:
By substituting 20% of debt for debt yielding 8%, the company now has 20% financing from debt and 80% from equity.
The expected return on common stock after refinancing can be calculated by;
Return after refinancing = Return before refinancing + [tex]\frac{Debt}{Equity}[/tex](return before refinancing - Debt yield)
= 12% + [tex]\frac{0.2}{0.8} (0.12 - 0.08)[/tex]
= 13%
Although appealing to more refined tastes, art as a collectible has not always performed so profitably. During 2003, an auction house sold a sculpture at auction for a price of $10,371,500. Unfortunately for the previous owner, he had purchased it in 1999 at a price of $12,497,500.
What was his annual rate of return on this sculpture? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Annual rate of return %
Answer:
-4.25%
Explanation:
purchase price in 1999 = $12,497,500
purchase price in 2003 = $10,371,500
annual rate of return = {[($10,371,500 - $12,497,500) / $12,497,500] / (2003 - 1999)} x 100 = (-0.170114 / 4) x 100 = -4.25%
the annual rate of return refers to how much money you win or loss with an investment during a year. In this case, the investor lost $2,126,000 in 4 years, which resulted in a total loss of 17.01% for the whole period.
ent "Flounder" Dorfman is a full-time student at Faber College. He is a senior and a member of Delta Tau Chai fraternity. The Deltas awarded Kent a $35,000 scholarship called "The Dean Wormer Double Secret Probation Memorial Scholarship". Kent pays the following amounts, out of his scholarship, to attend Faber College: Tuition - $26,000; Required lab fees - $300; Required books and supplies - $1,000; Room and board - $7,500. Part 1 of 6: Does the $26,000 of the scholarship that was paid for tuition have to be included in Flounder's taxable income for federal income tax purposes?
Answer:
Kent "Flounder" Dorfman
Scholarship from Delta Tau Chair Fraternity
The $26,000 will not be included in Flounder's taxable income for federal income tax purposes. It is a qualified scholarship expense. It is only the portion of $7,500 used for Room and board that is not a qualified scholarship expense.
Though it is required that the $35,000 be disclosed in form 1040. Qualified expenses like tuition, required lab fee, required books and supplies are tax-exempt, while Room and board and other non-required expenses are not qualified and therefore taxable.
Explanation:
S117(b)(2) of the IRS Code states the expenses that are qualified and tax-exempt if they are tuition-related.
When a qualified student, usually above 18 years and enrolled in post-secondary educational institution, receives a scholarship, the amount she uses to pay for tuition and other required expenses, which are generally payable by other students, are regarded as qualified expenses. Since they are qualified, they are also tax-exempt, meaning that taxes will not be paid on them, instead they will be deducted for tax purposes from the student's income. In the case of Kent, the tuition fee is not included in her taxable income for federal income tax purposes.
Summary: With 250,000 employees in 19 countries, Aramark wanted to motivate its employees who clean airplanes for Delta and Southwest Airlines. Turnover of the low-paid, largely immigrant staff was high while morale was low. Wallets and other valuables left on planes disappeared. After 5 years of efforts to increase motivation, revenue rose from $5 million to $14 million. 1. What motivation theories apply to the workers at Aramark? 2. If you were the manager of these employees, what would you do to motivate them? Be honest regarding your personal management style and beliefs rather than trying to be like Roy Pelaez. 3. What are some possible barriers to the effectiveness of your motivation ideas? What could you do to overcome them?
Answer:
Explanation:
(A)
What motivation theory applies to the workers at Aramark?
The workers should be motivated with payments for the return of valuables forgotten in the aircraft.
(B)
To motivate them, offer them a salary increase
(C)
Some possible barriers to the effectiveness of these motivation ideas are gluttony (depending on individual worker), a period of stiff or falling profit (which will hinder the smooth running of the new benefit policies), change of management.
(D)
What could you do, to overcome them?
To ensure that workers do not still steal forgotten valuables, place a check or supervision on them.
To ensure the profit level is maintained or increased, make sure the workers do not relent in their duties. Sometimes, more benefits make workers relax more.
What is capital budgeting? a. The process of managing cash flow. b. The analysis of real asset investment opportunities. c. The process of managing current assets. d. None of the above.
Answer:
b. The analysis of real asset investment opportunities.
Explanation:
Capital Budgeting is the Process of appraising various alternatives of investments.
It uses techniques such as the Net Present Value methods, Internal Rate of Return and Payback Period methods to analyze the best alternatives of investments.
A July sales forecast projects that 6,000 units are going to be sold at a price of $10.50 per unit. The management forecasts 2% growth in sales each month. Total July sales are anticipated to be:
Answer:
Budgeted sales July= $63,000
Explanation:
Giving the following information:
A July sales forecast projects that 6,000 units are going to be sold at a price of $10.50 per unit.
To calculate the budgeted sales, we simply need to multiply the number of units sold for the selling price:
Budgeted sales July= 6,000*10.5= $63,000
Zebra, Inc., a calendar year S corporation, incurred the following items this year. Sammy is a 40% Zebra shareholder throughout the year.
Operating income (sales) $100,000
Cost of goods sold (40,000)
Depreciation expense (MACRS) (10,000)
Administrative expenses (5,000)
§1231 gain 21,000
Depreciation recapture income $25,000
Short-term capital loss from stock sale (6,000)
Long-term capital loss from stock sale (4,000)
Long-term capital gain from stock sale 15,000
Charitable contributions (4,500)
a. Calculate Sammy’s share of Zebra’s nonseparately computed income or loss.
b. Calculate Sammy’s share of any Zebra long-term capital gain.
Answer:
a. $70,000
b. $6,000
Explanation:
Non separately income = Operating income +Depreciation recapture income -COGS -ADM expense -depreciation
= $100,000 + $25,000 - $40,000 - $5,000 - $10,000
= $70,000
a. Sammy share of Zebra’s non-separately computed income or loss
= $70,000 * 0.40
= $28,000
b. Sammy share in Long term capital gain
= $15,000 * 0.40
= $6,000
Standard Direct Materials Cost per Unit Crazy Delicious Inc. produces chocolate bars. The primary materials used in producing chocolate bars are cocoa, sugar, and milk. The standard costs for a batch of chocolate (2,857 bars) are as follows: Ingredient Quantity Price Cocoa 630 lbs. $0.40 per lb. Sugar 180 lbs. $0.60 per lb. Milk 150 gal. $1.60 per gal. Determine the standard direct materials cost per bar of chocolate. If required, round to the nearest cent. $ per bar
Answer:
Standard direct material cost per unit= $0.21
Explanation:
Giving the following information:
The standard costs for a batch of chocolate (2,857 bars) are as follows:
Cocoa 630 lbs. $0.40 per lb.
Sugar 180 lbs. $0.60 per lb.
Milk 150 gal. $1.60 per gal
First, we need to calculate the total cost for 2,857 bars:
Total cost= 630*0.4 + 180*0.6 + 150*1.6
Total cost= $600
Now, the unitary standard cost:
Standard direct material cost per unit= 600/2,857
Standard direct material cost per unit= $0.21
If Piper Manufacturing manufactures one unique set of stack pipes, and the sell price is $121,000, the variable costs per unit are $62,000, and the fixed costs are $500,000, what is the break-even point in units
Answer:
8.47
Explanation:
The formula to calculate the break-even point in units is:
Break-even point in units=Fixed costs/(Selling price per unit-Variable cost per unit)
Fixed costs= $500.000
Selling price per unit= $121,000
Variable cost per unit= $62,000
Break-even point in units=$500,000/($121,000-$62,000)
Break-even point in units=$500,000/59,000
Break-even point in units=8.47
According to this, the break-even point in units is 8.47.
Paulson Company issues 6%, four-year bonds, on January 1 of this year, with a par value of $200,000 and semiannual interest payments.
Semiannual Period-End Unamortized Discount Carrying Value
(0) January 1, issuance $13,466 $ 186,534
(1) June 30, first payment 11,782 188,218
(2) December 31, second payment 10,098 189,902
Answer: Incomplete question.
the complete queston is
Use the above straight-line bond amortization table and prepare journal entries for the following.
(a) The issuance of bonds on December 31, 2020.
b) The first interest payment on June 30, 2021.
(c) The second interest payment on December 31, 2021.
find answer in explanation column.
Explanation:
Semiannual Period-End Unamortized Discount Carrying Value
(0) January 1, issuance $13,466 $ 186,534
(1) June 30, first payment 11,782 188,218
(2) December 31, second payment 10,098 189,902
1. to record issue of bonds payable
Date Account Debit Credit
Dec 31,2020 Cash(carrying value) $ 186,534
Discount on bonds payable $13,466
Bonds payable $200,000
2. To record first interest payment
Date Account Debit Credit
june 30, 2021 Interest expense $7,684
discount on bonds payable $1, 684
Cash $6,000
Calculation =
Cash paid towards interest every semi annual period = $200,000 X 6% X1/2 =$6,000.
interest expense = cash paid + discount on bonds payable written off.
= $6000 + $1, 684 = $7,684
discount on bonds payable = unamortised discount on 31 dec - unamortised discount on 30th june) ($13,466 -11,782 ==$1,684)
3.To record second interest payment on december 31,2021.
Date Account Debit Credit
Dec. 31 ,2021 Interest expense $7,684
discount on bonds payable $1.684
Cash $6,000
Calculation
discount on bonds payable = unamortised discount on 30th june - unamortised discount on 31st december 2021 =11,782-10,098 = $1.684
A company had the following cash flows for the year: (a) Purchased inventory, $60,000 (b) Sold goods to customers, $90,000 (c) Received loan from a local bank, $150,000 (d) Purchased land, $180,000 (e) Purchased treasury stock, $40,000 (f) Paid dividends, $10,000 (g) Sold delivery truck, $30,000 What amount would be reported for net investing cash flows on the Statement of Cash Flows
Answer:
($150000)
Explanation:
The computation of the net investing cash flows is shown below;
Purchase of land ($180,000)
Sale of delivery truck $30,000
Net Cash used in Investing activities ($150000)
The purchase of land is an outflow of cash and the sale of delivery truck is a inflow of cash so it would be shown in a negative and positive amount
Thus all other values would be ignored
Students arrive at the Administrative Services Office at an average of one every 15 minutes, and their requests take on average 10 minutes to be processed. The service counter is staffed by only one clerk, Judy Gumshoes, who works eight hours per day. Assume Poisson arrivals and exponential service times.
Required:
a. What percentage of time is Judy idle?
b. How much time, on average, does a student spend waiting in line?
c. How long is the (waiting) line on average?
d. What is the probability that an arriving student (just before entering the Administrative Services Office) will find at least one other student waiting in line?
Managers are important members of the organization. Within an organization, there are managers at four levels: top, middle, first-line, and team leaders.
a. True
b. False
Answer:
The correct answer is the option B: False.
Explanation:
To begin with, the managers are one of the most important parts of the organization due to the fact that they have the task to plan, organize, direct and control the operations of the company. There are at least three levels in which the managers can go and have their work done, like the management area(high), the department areas(middle) and the operations area(low): However, that will depend on the organization and its size due to that an organization can only have managers at one level.
MONTGOMERY INC.
Comparative Balance Sheets
December 31
Current Year Prior Year
Assets
Cash $ 30,800 $ 31,000
Accounts receivable, net 8,900 10,900
Inventory 79,800 63,000
Total current assets 119,500 104,900
Equipment 44,200 37,300
Accum. depreciation—Equipment (19,900) (13,800)
Total assets $ 143,800 $ 128,400
Liabilities and Equity
Accounts payable $ 21,200 $ 22,900
Salaries payable 400 500
Total current liabilities 21,600 23,400
Equity
Common stock, no par value 102,400 94,100
Retained earnings 19,800 10,900
Total liabilities and equity $ 143,800 $ 128,400
MONTGOMERY INC.
Income Statement
For Current Year Ended December 31
Sales $ 38,500
Cost of goods sold (16,000)
Gross profit 22,500
Operating expenses
Depreciation expense $ 6,100
Other expenses 4,700
Total operating expense 10,800
Income before taxes 11,700
Income tax expense 2,800
Net income $ 8,900
Additional Information on Current-Year Transactions
1. No dividends are declared or paid.
2. Issued additional stock for $8,300 cash.
3. Purchased equipment for cash; no equipment was sold.
Use the above information to prepare a statement of cash flows for the current year using the indirect method. (A
Answer:
Montgomery Inc.
Statement of Cash Flow, using the indirect method:
Net income $ 8,900
adjusting non-cash expense:
Depreciation 6,100
Net Cash from operations $15,000
Add: Working Capital:
Accounts receivable (2,000)
Inventory (16,800)
Accounts Payable (1,700)
Salaries payable (100)
Cash from operating activities ($5,600)
Investing Activities:
Purchase of Equipment (6,900)
Financing Activities:
Issue of additional stock 8,300
Net cash flow $4,200
Explanation:
MONTGOMERY INC. Comparative Balance Sheets
December 31
Current Year Prior Year
Assets
Cash $ 30,800 $ 31,000
Accounts receivable, net 8,900 10,900
Inventory 79,800 63,000
Total current assets 119,500 104,900
Equipment 44,200 37,300
Accum. depreciation: Equipment (19,900) (13,800)
Total assets $ 143,800 $ 128,400
Liabilities and Equity
Accounts payable $ 21,200 $ 22,900
Salaries payable 400 500
Total current liabilities 21,600 23,400
Equity
Common stock, no par value 102,400 94,100
Retained earnings 19,800 10,900
Total liabilities and equity $ 143,800 $ 128,400
MONTGOMERY INC.
Income Statement
For Current Year Ended December 31
Sales $ 38,500
Cost of goods sold (16,000)
Gross profit 22,500
Operating expenses
Depreciation expense $ 6,100
Other expenses 4,700
Total operating expense 10,800
Income before taxes 11,700
Income tax expense 2,800
Net income $ 8,900
b) The indirect method of preparing the statement of cash flows starts with the net income and uses the balances in the balance sheet to determine if they are net cash outflows or inflows.
Furniture costing $61,700 is sold at its book value in 2017. Acquisitions of furniture total $50,000 cash, on which no depreciation is necessary because it is acquired at year-end. What is the cash inflow related to the sale of furniture
Answer:
cash inflow = $32,100
Explanation:
there is some information missing:
accumulated depreciation 2016 (furniture) = $9,000depreciation expense 2017 (furniture) = $37,600accumulated depreciation 2017 (furniture) = $17,000we must first determine the book value of the furniture which was sold:
total depreciation related to the sold furniture = $9,000 + $37,600 - $17,000 = $29,600
book value = $61,700 - $29,600 = $32,100
since the furniture was sold at book value, then the cash inflow = $32,100
Cash inflow refers to money being received or earned by the company, while cash outflows refer to money being paid by the company.
Which of the following items are normally classified as current liabilities for a company that has a one-year operating cycle? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.)
Answer:
Sales tax payable FICA-social security taxes payable due in 40 days Portion of long term note due in 1 monthExplanation:
Current Liabilities refer to obligations owed in a 12 month period. Anything longer is classified as Long Term.
From the options listed the current liabilities will therefore be;
Sales Tax Payable which are the taxes that the government charges on goods and services and it is the responsibility of business to collect these and remit them to the Government on time. This is a current liability as these are remitted quite frequently.
The FICA social security taxes payable due in 40 days is also a current liability due its time period being less than a year.
A portion of a long term loan due in a month will be considered current also due to its time period.
Current liabilities for a company include Sales tax payable, FICA-social security taxes payable due in 40 days and portion of long term note due in 1 month.
What is the term Current Liability about?
Current Liabilities refer to obligations owed in a 12 month period. Anything longer is classified as Long Term.
Sales Tax Payable which are the taxes that the government charges on goods and services and it is the responsibility of business to collect these and remit them to the Government on time
The FICA social security taxes payable due in 40 days is also a current liability due its time period being less than a year.
A portion of a long term loan due in a month will be considered current also due to its time period.
Learn more about Current Liability, refer to the link:
https://brainly.com/question/13388204
The common stock of Sweet Treats is selling for $50.15 per share. The company is expected to have an annual dividend increase of 3.6 percent indefinitely and pay a dividend of $3.80 in one year. What is the total return on this stock?
Answer:
11.2%
Explanation:
Here, we want to calculate the total return on the stock.
From the question, Price = $50.15
Mathematically;
P = D1/Ke-g
D1 = $3.80
g = 3.60%
So let’s calculate Ke-g
50.15 = 3.8/ke-g
Ke-g = 3.8/50.15
Ke-g = 7.6%
but g = 3.6%
Total return Ke = 3.6% + g = 3.6% + 7.6% = 11.2%
Suppose that purely competitive firms producing cashews discover that P exceeds MC.
a. Is their combined output of cashews too little, too much, or just right to achieve allocative efficiency?
b. In the long run, what will happen to the supply of cashews and the price of cashews?
1. Supply will increase and the price of cashews will increase.
2. Supply will increase and the price of cashews will decrease.
3. Supply will decrease and the price of cashews will decrease.
4. Supply will decrease and the price of cashews will increase.
Answer:
a. Too Little
b. 2. Supply will increase and the price of cashews will decrease.
Explanation:
a. Output is always maximised when Marginal Revenue equals Marginal Cost because at this point it is argued that all resources are being utilised. In a purely competitive market, the Price is equal to the Marginal Revenue. If the price is larger than the Marginal Cost that means that Marginal Revenue is larger than Marginal Cost. The firms are therefore not utilising enough resources to produce as much as they can which should change.
b. In the long run in a purely competitive market, more firms will enter the market as they will see it as a chance to make economic profits. As this happens the Supply will increase due to the larger number of firms and the price will decrease as a result as well.
Suppose Emilio offers you $500 today or $X in 10 years. If the interest rate is 6 percent, then at what value of X would you be indifferent between the two options
This question is impossible and implausible
Who is Emilio? How do we know he'll be around in 10 years? IS he good for the money, or is it counterfeit? Are we adjusting for inflation? The dollar is worth more in Malaysia than the U.S., so where are we starting and where are we ending? There's just not enough data here.