Answer:
a. Accounts receivable period:
= Accounts receivable turnover ratio * 365 days
= (Average accounts receivable / Sales) * 365
= (110 / 5,000) * 365
= 8.0 days
b. Accounts Payable period:
= Accounts payable turnover ratio * 365
= (Average accounts payable / Cost of goods sold) * 365
= (270 / 4,200) * 365
= 23.5 days
c. Inventory period:
= Inventory turnover ratio * 365
= (Average inventory / Cost of goods sold) * 365
= (550 / 4,200) * 365
= 47.8 days
d. Cash cycle:
= Inventory period + Accounts receivables period - Accounts payable period
= 47.8 + 8 - 23.5
= 32.3 days
Sierra Company produces its product at a total cost of $89 per unit. Of this amount, $14 per unit is selling and administrative costs. The total variable cost is $58 per unit, and the desired profit is $28 per unit. Determine the markup percentage using the (a) total cost, (b) product cost, and (c) variable cost methods. Round your answers to one decimal place. a. Total cost fill in the blank 1 % b. Product cost fill in the blank 2 % c. Variable cost fill in the blank 3 %
Answer: and Explanation:
The computation of the markup percentage using the following cost is shown below:
a. Total cost
= Desired profit ÷ total cost
= $28 ÷ $89
= 31.46%
b. Under product cost
= Desired profit ÷ (total cost - seling & admin cost)
= ($28) ÷ ($89 - $14)
= 37.33%
c. Under variable cost
= Desired profit ÷ variable cost
= $28 ÷ $58
= 48.28%
By applying the above formulas we can easily calculate them
When George and Arthurine Renfro decided to start a family business in 1990 and market chowchow, a southern regional food, they had to determine how they would price the chowchow by examining the demand for the product (would people rather eat home-made or store-bought), the cost of getting the jars for bottling the chowchow, and how much it would cost to distribute the product to area stores. In other words, the Renfros had to begin the development of their pricing strategy by:
Answer:
identifying pricing constraints.
Explanation:
From the question we are informed about George and Arthurine Renfro decided who decided to start a family business in 1990 and market chowchow, a southern regional food, they had to determine how they would price the chowchow by examining the demand for the product (would people rather eat home-made or store-bought), the cost of getting the jars for bottling the chowchow, and how much it would cost to distribute the product to area stores. In other words, in this case, the Renfros had to begin the development of their pricing strategy by identifying pricing constraints. .
Pricing constraints can be regarded as
factors which brings about limit of latitude of prices which a company may set.
In an effort to reduce costs, many regional power companies want to lower their safety stock of electricity transformers. To support this desire, a large transformer OEM will store safety stock of transformers in a FedEx warehouse in Memphis, Tennessee in order to insure quick air delivery to any of these is power companies should the need arise. This collaboration will result in lower overall inventory across the supply chain, making it possible for all parties to lower their costs.
1. The OEM has signed up 14 power companies on this rapid replenishment program. On average, each of these power companies used to hold 38 transformers in their safety stock. In total, how many transformers would these companies hold?
2. To maintain the same service level after this transition, how many units (transformers) would the OEM need to hold (or pool) in the FedEx warehouse?
3. After making this change for these power companies and OEM, by how many units (transformers) will inventory go down?
4. By what percentage would their inventory decrease by consolidating their inventory from the dealerships into the warehouse?
Answer:
1. Total transformers held by power companies = 532
2. The total units of transformers that OEM needs to hold in the FedEx warehouse = 38
3. The inventory of transformers will go down by 494.
4. The percentage of the decrease = 93%.
Explanation:
Power companies signed up on the rapid replenishment program = 14
Average number of transformers held in safety stock by each power company = 38
Total number of transformers in safety stock = 532 (14 * 38)
Number of transformers needed in the FedEx warehouse = 38
Inventory will go down by 494 (532 - 38)
Percentage of inventory decrease = 93% (494/532 * 100)
Using the supply and demand analysis of the market for reserves, indicate what happens to the federal funds rate, borrowed reserves, and nonborrowed reserves, holding everything else constant, under the following situations. a. The economy is surprisingly strong, leading to an increase in the amount of checkable deposits. b. Banks expect an unusually large increase in with-drawals from checking deposit accounts in the future. c. The Fed raises the target federal funds rate. d. The Fed raises the interest rate on reserves above the current equilibrium federal funds rate. e. The Fed reduces reserve requirements. f. The Fed reduces reserve requirements and then off-sets this action by conducting an open market sale of securities.
Answer:
The federal fund rate will increase, non borrowed reserves will decrease and no change in borrowed reserves.
Explanation:
Federal fund rate is an interest rate which banks pay off each night on depository funds. This rate can be above the discount rate because banks prefer to pay higher market rate than to borrow from Fed. When the fed raises target federal fund than federal fund rate will increase causing a decline in no borrowed reserves.
Reuse of large amounts of copyrighted film in a documentary would not constitute a copyright infringement.
a) True
b)False
Answer:
B. False
Explanation:
I majored in Business
Which of the following is a disadvantage of incentive compensation plans? Group of answer choices Employees are taxed heavily on their income from incentive plans. Employers are taxed heavily on their expenditure incurred through incentive plans. Employees know that rise in productivity will have no impact on their compensation. Employers are unable to increase employee productivity while following incentive plans. Employees don't develop loyalty to their employers when incentive plans are practiced.
Answer:
Employees don't develop loyalty to their employers when incentive plans are practiced.
Explanation:
Incentive compensation plan can be regarded as strategic that is been utilized by using incentives in driving a better business outcomes together with alignment of sales rep behavior to go with the goals of the organization. It is a compensation plan which can appear in different forms such as commissions as well as bonuses and prizes. It should be noted that one of the disadvantage of incentive compensation plans is that Employees don't develop loyalty to their employers when incentive plans are practiced.
What is the difference between social marketing and advertising?
Answer:
Social media marketing is any social media action you take that is unpaid. If you're posting about your blogs, sharing info with your followers, or commenting in social media groups, you're marketing. Social media advertising is any action you take on social media that is paid.
Explanation:
A wedding party hired a sole proprietorship to cater their wedding, and the sole proprietorship had an employee handle the entire job. If the entire wedding party gets food poisoning, the principal is liable. The employee of the sole proprietorship is also liable because he handled the entire job.
pls dont spam me need halp
Answer:
yes because he was put in charge of the whole operation
What is the basic economic problem that happens because people have unlimited wants but resources are limited? *
A opportunity cost
B sunk cost
C needs
D scarcity
Answer:
D
Explanation:
Scarcity is the basic economic problem that happens because people have unlimited wants but resources are limited.
hope this helps
Roy DeSoto earns a regular hourly salary of $24.00. He is paid time-and-a-half for all hours in excess of 40 in the week. For the week ended March 8, 20X1, he worked a total of 60 hours. His gross wages year to date, prior to his March 8, paycheck, are $12,160. Social Security Tax is 6.2% on a maximum of $132,900 of gross wages per year, Medicare Tax is 1.45%, federal unemployment tax is 0.6% and state unemployment tax is 4.2%, both on a maximum of $7,000 of gross wages per year. What is the employer's payroll tax expense for Roy for the week ended March 8, 20X1
at a higher price the quantity supplied of a product typically is
higher or lower
Answer:
The law of supply states, that higher prices lead to higher quantities of things.
Explanation:
I searched it up. I was confused. Sorry for searching it up.
On October 1, 2021, Blue Corp. issued $744,000, 7%, 10-year bonds at face value. The bonds were dated October 1, 2021, and pay interest annually on October 1. Financial statements are prepared annually on December 31. (a) Prepare the journal entry to record the issuance of the bonds. (Credit account titles are automatically indented when amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit Oct. 1, 2021 enter an account title for the journal entry on October 1, 2021enter an account title for the journal entry on October 1, 2021 enter a debit amountenter a debit amount enter a credit amountenter a credit amount enter an account title for the journal entry on October 1, 2021enter an account title for the journal entry on October 1, 2021 enter a debit amountenter a debit amount enter a credit amountenter a credit amount
Answer:
Blue Corp.
Journal Entry
Date Account Titles and Explanation Debit Credit
Oct. 1, 2021 Cash $744,000
Bonds Liability $744,000
To record the issuance of the 7%, 10-year bonds at face value.
Explanation:
a) Data and Analysis:
Face value of 7%, 10-year bonds = $744,000
Bonds issue = at face value
Issue date = October 1, 2021
Interest payment = annual
Interest payment date = October 1
Annual interest payment = $52,080 ($744,000 * 7%)
Records on December 31, 2021:
Accrual of interest for the year:
Interest Expense $13,020
Interest payable $13,020
To accrue interest for 3 months.
Records on October 1, 2022:
Interest Expense $39,060
Interest payable $13,020
Cash $52,080
To record the interest payment.
Transic Corporation has the following financial data for 2016 and 2017. 2017 2016 ASSETS Current Assets: Cash $ 48,000 $ 14,000 Marketable Securities 9,000 13,000 Accounts Receivable 35,000 24,000 Other Current Assets 15,000 18,000 Total Current Assets 107,000 69,000 Fixed Assets (net) 140,000 130,000 Total Assets $247,000 $199,000 LIABILITIES Current Liabilities $ 72,000 $ 52,000 Long-term Liabilities 50,000 37,000 Total Liabilities $122,000 $ 89,000 Total Stockholders' Equity $125,000 $110,000 Total Liabilities And Stockholders' Equity $247,000 $199,000 What is Transic's current ratio for 2017
Answer:
1.49
Explanation:
Calculation to determine Transic's current ratio for 2017
Using this formula
2017 Current ratio=2017 Total Current Assets /2017 Current Liabilities
Let plug in the formula
2017 Current ratio=$107,000/$ 72,000
2017 Current ratio=1.486
2017 Current ratio=1.49 (Approximately)
Therefore Transic's current ratio for 2017 is 1.49
Sonic Inc. manufactures two models of speakers, Rumble and Thunder. Based on the following production and sales data for June, prepare (a) a sales budget and (b) a production budget: Rumble Thunder Estimated inventory (units), June 1 284 79 Desired inventory (units), June 30 327 69 Expected sales volume (units): Midwest Region 4,300 4,800 South Region 5,050 4,400 Unit sales price $95 $225
Answer:
Sonic Inc.
a. Sales Budget for the month of June:
Rumble Thunder Total
Midwest Region 4,300 4,800 9,100
South Region 5,050 4,400 9,450
Total units sold 9,350 9,200 18,550
Sales price $95 $225
Expected Sales Revenue $888,250 $2,070,000 $2,958,250
b. Production Budget for the month of June:
Rumble Thunder Total
Desired inventory (units), June 30 327 69 396
Total units sold 9,350 9,200 18,550
Total units available for sale 10,287 9,269 19,556
Estimated inventory (units), June 1 284 79 363
Units to be produced 10,003 9,190 19,193
Explanation:
a) Data and Calculations:
Rumble Thunder
Estimated inventory (units), June 1 284 79
Desired inventory (units), June 30 327 69
Expected sales volume (units):
Midwest Region 4,300 4,800
South Region 5,050 4,400
Unit sales price $95 $225
Short Company purchased land by paying $11,000 cash on the purchase date and agreed to pay $11,000 for each of the next six years beginning one-year from the purchase date. Short's incremental borrowing rate is 7%. On the balance sheet as of the purchase date, after the initial $11,000 payment was made, the liability reported is closest to: (FV of $1, PV of $1, FVA of $1, and PVA of $1) (Use appropriate factor(s) from the tables provided.)
Answer: $52,431.50
Explanation:
The liability reported will be the present value of the six payments of $11,000.
Since this is a constant amount, it will be an annuity:
= 11,000 * Present value interest factor of an annuity, 6 years, 7%
= 11,000 * 4.7665
= $52,431.50
Any difference between this and any options given is down to rounding errors. Pick the closest figure.
The following are budgeted data: January February March Sales in units 16,900 23,800 19,900 Production in units 19,900 20,900 20,000 One pound of material is required for each finished unit. The inventory of materials at the end of each month should equal 25% of the following month's production needs. Purchases of raw materials for February would be budgeted to be:
Answer:
Purchases= 20,675 pounds
Explanation:
Giving the following information:
Production:
Feb= 20,900
Mar= 20,000
One pound of material is required for each finished unit.
Desired ending inventory= 25% of the following month's production needs.
To calculate the purchase required for February, we need to use the following formula:
Purchases= production + desired ending inventory - beginning inventory
Purchases= 20,900 + (20,000*0.25) - (20,900*0.25)
Purchases= 20,675
What exactly allows individuals to consume more if they specialize and trade than if they don't
Answer:
They work within the company that allows them to do so. Vs. others that don't.
Explanation:
Hope this helps! plz mark as brainliest!
You are getting paid biweekly at the rate of $12 per hour. Calculate your net pay, the gross pay, and every deduction applicable utilizing the image above for reference.
Answer:
i need to quit that job if i'm only getting payed 12 bucks an hour hell i need a better job....
Explanation:
Pewabic plans to sell 900 boxes of art tile in April, and estimates they'll craft 870 boxes during the month. Each box of tile requires 44 pounds of clay and a quarter hour of direct labor. Clay costs $0.40 per pound and pottery artisans are paid $12.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Pewabic has 3,900 pounds of clay in beginning inventory on April 1 and wants to have 4,500 pounds in ending inventory on April 30. What total amount should Pewabic budget for direct labor for the of April
Answer:
Direct labour cost budget= $2,610
Explanation:
The direct labor cost budget is a function of the production product budget. The quantity of the product budgeted to be produced would determine the labor cost budget.
Direct labour budget = Production budget × standard hours × standard labour rate per hour
Standard hour = a quarter direct labour = 1/4 hour
Direct labour budget = 870 × 0.1× $12= $2610
Direct labour cost budget= $2,610
Mary Magnolia wants to open a flower shop, the Petal Pusher, in a new mall. She has her choice of three different floor sizes, 200 square feet, 500 square feet, or 1,000 square feet. The monthly rent will be $1 a square foot. Mary estimates that if she has F square feet of floor space and sells y bouquets a month, her variable costs will be cv(y) = y^ 3/ 4F per month.
Required:
a. If she has 200 square feet of floor space, write down her marginal cost function and her average cost function. At what amount of output is average cost minimized? At this level of output, how much is average cost?
b. If she has 500 square feet, write down her marginal cost function and her average cost function. At what amount of output is average cost minimized? At this level of output, how much is average cost? .
c. If she has 1,000 square feet of floor space, write down her marginal cost function and her average cost function. At what amount of output is average cost minimized? At this level of output, how much is average cost?
Answer:
a-1. We have:
MC = 3y^2 / 800 <=== Marginal cost (MC) function
AC = (200 / y) + (y^2 / 800) <=== Average cost (AC) function
a-2. The amount of output is 43.09 bouquets.
a-3. Average cost at this level is $6.96 per unit.
b-1. We have:
MC = 3y^2 / 2,000 <=== Marginal cost (MC) function
AC = (500 / y) + (y^2 / 2,000) <=== Average cost (AC) function
b-2. The amount of output is 79.37 bouquets.
b-3. Average cost at this level is $9.45 per unit.
c-1. We have:
MC = 3y^2 / 4,000 <=== Marginal cost (MC) function
AC = (1,000 / y) + (y^2 / 4,000) <=== Average cost (AC) function
c-2. The amount of output is 125.99 bouquets.
c-3. Average cost at this level is $11.91 per unit.
Explanation:
Given:
cv(y) = y^3/ 4F ………………… (1)
cf = fixed cost = F
Therefore, total cost (C) per month is as follows:
C(y) = cf + cv(y) = y^ 3/ 4F
C(y) = F + y^3 / 4F ……………………… (2)
a-1. If she has 200 square feet of floor space, write down her marginal cost function and her average cost function.
This implies that:
F = 200
Marginal cost (MC) function is obtained by taking the first derivative of equation (1) and substituting F = 200 as follows:
MC = cv’(y)
MC = 3y^2 / (4 * 200)
MC = 3y^2 / 800 ………………. (3) <= Marginal cost (MC) function
Average cost (AC) function can be obtained by dividing equation (2) by y, substituting F = 200 and solve as follows:
AC = C’(y) = (200 / y) + (y^3 / 4F) / y
AC = (200 / y) + (y^3 / (4 * 200)) / y
AC = (200 / y) + (y^2 / 800) …………………. (4) <= Average cost (AC) function
a-2. At what amount of output is average cost minimized?
Since average cost is minimized when MC = AC, we therefore equate equations (3) and (4) and solve for y as follows:
3y^2 / 800 = (200 / y) + (y^2 / 800)
0.00375y^2 = (200 / y) + 0.00125y^2
0.00375y^2 - 0.00125y^2 = 200 / y
0.0025y^2 = 200 / y
(0.0025y^2)y = 200
0.0025y^3 = 200
y^3 = 200 / 0.0025
y^3 = 80,000
y = 80,000^(1/3)
y = 43.09
Therefore, the amount of output at which is average cost minimized is 43.09 bouquets.
a-3. At this level of output, how much is average cost?
Substituting y = 43.09 into equation (4), we have:
AC = (200 / 43.09) + (43.09^2 / 800)
AC = 6.96
Therefore, average cost at this level is $6.96 per unit.
b-1. If she has 500 square feet, write down her marginal cost function and her average cost function.
This implies that:
F = 500
Marginal cost (MC) function is obtained by taking the first derivative of equation (1) and substituting F = 500 as follows:
MC = cv’(y)
MC = 3y^2 / (4 * 500)
MC = 3y^2 / 2,000 ………………. (5) <= Marginal cost (MC) function
Average cost (AC) function can be obtained by dividing equation (2) by y, substituting F = 500 and solve as follows:
AC = C’(y) = (500 / y) + (y^3 / (4 * 500)) / y
AC = (500 / y) + (y^3 / (4 * 500)) / y
AC = (500 / y) + (y^2 / 2,000) …………………. (6) <= Average cost (AC) function
b-2. At what amount of output is average cost minimized?
Since average cost is minimized when MC = AC, we therefore equate equations (5) and (6) and solve for y as follows:
3y^2 / 2,000 = (500 / y) + (y^2 / 2,000)
0.0015y^2 = (500 / y) + 0.0005y^2
0.0015y^2 - 0.0005y^2 = 500 / y
0.001y^2 = 500y
0.001y^2 * y = 500
0.001y^3 = 500
y^3 = 500 / 0.001
y^3 = 500,000
y = 500,000^(1/3)
y = 79.37
Therefore, the amount of output at which is average cost minimized is 79.37 bouquets.
b-3. At this level of output, how much is average cost?
Substituting y = 79.37 into equation (6), we have:
AC = (500 / 79.37) + (79.37^2 / 2,000)
AC = 9.45
Therefore, average cost at this level is $9.45 per unit.
c-1. If she has 1,000 square feet, write down her marginal cost function and her average cost function.
This implies that:
F = 1,000
Marginal cost (MC) function is obtained by taking the first derivative of equation (1) and substituting F = 1,000 as follows:
MC = cv’(y)
MC = 3y^2 / (4 * 1,000)
MC = 3y^2 / 4,000 ………………. (7) <= Marginal cost (MC) function
Average cost (AC) function can be obtained by dividing equation (2) by y, substituting F = 1,000 and solve as follows:
AC = C’(y) = (1,000 / y) + (y^3 / (4 * 1,000)) / y
AC = (1,000 / y) + (y^3 / (4,000)) / y
AC = (1,000 / y) + (y^2 / 4,000) …………………. (8) <= Average cost (AC) function
c-2. At what amount of output is average cost minimized?
Since average cost is minimized when MC = AC, we therefore equate equations (7) and (8) and solve for y as follows:
3y^2 / 4,000 = (1,000 / y) + (y^2 / 4,000)
0.00075y^2 = (1,000 / y) + 0.00025y^2
0.00075y^2 - 0.00025y^2 = 1,000 / y
0.0005y^2 = 1,000 / y
0.0005y^2 * y = 1,000
y^3 = 1,000 / 0.0005
y^3 = 2,000,000
y = 2,000,000^(1/3)
y = 125.99
Therefore, the amount of output at which is average cost minimized is 125.99 bouquets.
c-3. At this level of output, how much is average cost?
Substituting y = 125.99 into equation (8), we have:
AC = (1,000 / 125.99) + (125.99^2 / 4,000)
AC = 11.91
Therefore, average cost at this level is $11.91 per unit.
Expenditures for major additions, improvements and flight equipment modifications are capitalized when such costs are determined to extend the useful life of the asset or are part of the cost of acquiring the asset. Expenditures for equipment overhaul costs of engines or airframes prior to their operational use are capitalized as part of the cost of such assets as they are costs required to ready the asset for its intended use. Maintenance and repairs costs are charged to expense as incurred.
Assume that FedEx made extensive repairs on an existing building and added a new wing. The building is a garage and repair facility for delivery trucks that serve the Denver area. The existing building originally cost $720,000, and by the end of 2010 (10 years), it was half depreciated on the basis of a 20-year estimated useful life and no residual value. Assume straight-line depreciation was used. During 2011, the following expenditures related to the building were made:
a. Ordinary repairs and maintenance expenditures for the year, $7,000 cash.
b. Extensive and major repairs to the roof of the building, $122,000 cash. These repairs were completed on December 31, 2011.
c. The new wing was completed on December 31, 2011, at a cash cost of $230,000.
Required:
Apply the policies of FedEx.
Answer:
FedEx
Applying the policies of FedEx:
a and b. Total repairs and maintenance expenses to be charged to the income statement = $129,000 ($7,000 + $122,000).
c. The building extension cost of $230,000 will be capitalized.
The Building will now have a total cost value of $950,000 Accumulated Depreciation of $396,000.
Therefore, the net book value of building at the end of December 31, 2011 will be $554,000 ($950,000 - $396,000).
Explanation:
a) Data and Analysis:
Cost of existing building = $720,000
Book value of existing building = $360,000 ($720,000 * 10/20)
Transactions and adjustments during 2011:
a. Repairs and Maintenance Expenses $7,000 Cash $7,000
b. Repairs and Maintenance Expenses $122,000 Cash $122,000
c. Building extension $230,000 Cash $230,000
d. Depreciation Expense on existing building = $36,000 ($720,000/20).
e. Accumulated Depreciation on Building, Dec. 31, 2011 = $396,000 ($360,000 + $36,000)
Which transaction involves a good?
A. Selling desk chairs
B. Washing windows
C. Providing technology support
D. Displaying an advertisement
Answer:
Providing technology support
Answer:
Explanation:
selling desk chairs, just got it right
During 2019, Pepe Guardio purchases the following property for use in his calendar year-end manufacturing business:
Item Date Acquired Cost
Manufacturing equipment (7 year) June 2 $40,000
Office furniture September 15 $6,000
Office computer November 18 $2,000
Passenger automobile
(used 90 percent for business) May 31 $54,000
Warehouse June 23
Building $165,000
Land $135,000
Pepe uses the accelerated depreciation method under MACRS, if available, and does not make the election to expense or take a bonus depreciation. Use Form 4562 to report Pepe's depreciation expense for 2019.
Enter all amounts as positive numbers. If required, round to the nearest dollar. If an amount is zero, enter "0."
Answer:
Depreciation Expense for 2019 using form 4562
Basis For depreciation; Recovery Period ; Convention ; Method ; Depreciation deduction
2,000 ; 5 years ; HY ; 200 DB ; 400
40,000 ; 7 years ; HY ; 200 DB ; 6,573
Explanation:
Accelerated method of depreciation is used by businesses for accounting and income tax purposes. The depreciation is calculated in such a way that the depreciation expense is higher in early years and lower in later years. Pepe is also using this method to account for his business assets. The depreciation expense for computer equipment and manufacturing equipment's totals $6,973.
Data concerning Wislocki Corporation's single product appear below: Per Unit Percent of Sales Selling price $ 180 100 % Variable expenses 36 20 % Contribution margin $ 144 80 % Fixed expenses are $1,044,000 per month. The company is currently selling 9,000 units per month. Required: The marketing manager would like to introduce sales commissions as an incentive for the sales staff. The marketing manager has proposed a commission of $14 per unit. In exchange, the sales staff would accept an overall decrease in their salaries of $110,000 per month. The marketing manager predicts that introducing this sales incentive would increase monthly sales by 400 units. What should be the overall effect on the company's monthly net operating income of this change
Answer:
$36,000 increase
Explanation:
The computation of the overall effect on the company's monthly net operating income of this change is shown below:
Particulars Current Proposed
Unit sales 9,000 units 9,400 units
Sales $1,620,000 $1,692,000
(9,000 units × $180) (9,400 units × $180)
less: variable cost -$324,000 -$470,000
(9,000 units × $36) (9,400 units × $50)
Contribution margin $1,296,000 $1,222,000
Less: fixed cost -$1,044,000 -$934,000
Net operating income $252,000 $288,000
Hence, there is an increase in net operating income by
= $288,000 - $252,000
= $36,000
A reconciliation of Zack's Company's pretax accounting income with its taxable income for 2018, its first year of operations, is as follows: Pretax accounting income $3,000,000 Excess tax depreciation (150,000) Taxable income $2,850,000 The excess tax depreciation will result in equal net taxable amounts in each of the next three years. Enacted tax rates are 40% in 2018, 35% in 2019 and 2020, and 30% in 2021. The total deferred tax liability to be reported on Charles's balance sheet at December 31, 2018, is
Answer:
the total deferred tax liability is $50,000
Explanation:
The computation of the total deferred tax liability is shown below:
Tax Depreciation 2019 $17500 {[$150000 ÷ 3] × 35%}
Tax Depreciation 2020 $17500 {[$150000 ÷ 3] × 35%}
Tax Depreciation 2021 $15000 {[$150000 ÷ 3] × 30%}
Total Deferred Tax Liability $50,000
Hence, the total deferred tax liability is $50,000
Neville is a lawyer at a large law firm where he earns a salary of $170,000 per year. He is thinking of leaving the firm to set up his own law office. To do this, he would need to invest $140,000 of his savings, which currently earns 5% in interest each year. He estimates that if he starts a law office, his annual revenue will be $510,000, and his explicit financial costs will be $300,000. How much would Neville earn in economic profits or losses if he starts his own law office
Answer:
$33,000
Explanation:
Economic profit = accounting profit - implicit cost
Accounting profit= total revenue - explicit cost
Explicit cost includes the amount expended in running the business. They include rent , salary and cost of raw materials
Implicit cost is the cost of the next best option forgone when one alternative is chosen over other alternatives
Accounting profit = $510,000 - $300,000 = $210,000
Implicit costs = amount he would forgo as salary in the large law firm and interest he would lose on his investment
Interest he would lose on his investment = 0.05 x 140,000 = $7000
Implicit cost = $170,000 + $7000 = $177,000
Economic profit = $210,000 - $177,000 = $33,000
The following information describes production activities of Mercer Manufacturing for the year.
Actual direct materials used 31,000 1bs. at $5.80 per lb
Actual direct labor used 10,600 hours for a total of $217,300
Actual units produced . 63,000
Budgeted standards for each unit produced are 0.50 pounds of direct material at $5.75 per pound and 10 minutes $21.50 per hour.
AQ = Actual Quantity
SQ=Standard Quantity
AP =Actual Price
SP =Standard Price
AH =Actual Hours
SH= Standard Hours
AR= Actual Rate
SR= Standard Rate
(1) Compute the direct materials price and quantity variances
(2) Compute the direct labor rate and efficiency varian rect labor rate and efficiency variances.
Answer:
Results are below.
Explanation:
To calculate the direct material price and quantity variance, we need to use the following formulas:
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (5.75 - 5.8)*31,000
Direct material price variance= $1,550 unfavorable
Direct material quantity variance= (standard quantity - actual quantity)*standard price
Direct material quantity variance= (63,000*0.5 - 31,000)*5.75
Direct material quantity variance= $2,875 favorable
To calculate the direct labor rate and efficiency variance, we need to use the following formulas:
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Direct labor time (efficiency) variance= (10,500 - 10,600)*21.5
Direct labor time (efficiency) variance= $2,150 unfavorable
Standard quantity= (10/60)*63,000= 10,500 hours
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Direct labor rate variance= (21.5 - 20.5)*10,600
Direct labor rate variance= $10,600 favorable
Actual rate= 217,300 / 10,600= $20.5
Ken is 63 years old and unmarried. He retired at age 55 when he sold his business, Understock.com. Though Ken is retired, he is still very active. Ken reported the following financial information this year. Assume Ken files as a single taxpayer. Determine Ken’s gross income and complete page 1 of Form 1040 for Ken.
a. Ken won $1,200 in an illegal game of poker (the game was played in Utah, where gambling is illegal).
b. Ken sold 1,000 shares of stock for $32 a share. He inherited the stock two years ago. His tax basis (or investment) in the stock was $31 per share.
c. Ken received $25,000 from an annuity he purchased eight years ago. He purchased the annuity, to be paid annually for 20 years, for $210,000.
d. Ken received $13,000 in disability benefits for the year. He purchased the disability insurance policy last year.
e. Ken resided in Ireland from July 1, 2011, through June 30, 2012, visiting relatives. While he was there he earned $35,000 working in his cousin’s pub. He was paid $17,000 for his services in 2011 and $18,000 for his services in 2012. Assume Ken elects to use the foreign-earned income exclusion to the extent he is eligible.
f. Ken decided to go back to school to learn about European history. He received a $500 cash scholarship to attend. He used $300 to pay for his books and tuition, and he applied the rest toward his new car payment.
g. Ken’s son, Mike, instructed his employer to make half of his final paycheck of the year payable to Ken. Ken received the check on December 30 in the amount of $1,100.
h. Ken received a $610 refund of the $3,600 in state income taxes his employer withheld from his pay last year. Ken claimed $5,850 in itemized deductions last year (the standard deduction for a single filer was 5,800).
i. Ken received $30,000 of interest from corporate bonds and money market accounts.
Answer:
bru is ken that ugly?
Explanation:
poor loner he must have been so ugly
One of two methods must be used to produce expansion anchors. Method A costs $80,000 initially and will have a $15,000 salvage value after 3 years. The operating cost with this method will be $30,000 per year. Method B will have a first cost of $120,000, an operating cost of $8,000 per year, and a $40,000 salvage value after its 3-year life. At an interest rate of 8% per year, the present worth of Method B is closest to:
Answer:
At an interest rate of 8% per year, the present worth of Method B is closest to:
= $108,856.
Explanation:
a) Data and Calculations:
Method A Method B
Initial investment $80,000 $120,000
Salvage value 15,000 40,000
Period of investment 3 years 3 years
Annual operating costs $30,000 $8,000
Interest rate per year 8% 8%
Present value annuity factor = 2.577
Discounted present value factor = 0.794
Present worth:
Method B Method A
Initial investment cost ($120,000 * 1) $120,000 $80,000
Operating costs = ($8,000 * 2.577) = 20,616 77,310
Salvage value = $40,000 * 0.794 = (31,760) (11,910)
Present worth = $108,856 $145,400
b) Using the present worth analysis technique, Method B should be used to produce the expansion anchors, as it costs less than Method A. The present worth analysis method is an equivalence method of discounting a project's cash flows to a single present value. With this analysis, it becomes easier to determine the project that should be accepted or rejected based on their economic realities.
To support herself while attending school, Daun Deloch sold stereo systems to other students. During the first year of operations, Daun purchased the stereo systems for $200,000 and sold them for $310,000 cash. She provided her customers with a one-year warranty against defects in parts and labor. Based on industry standards, she estimated that warranty claims would amount to 3 percent of sales. During the year, she paid $3,420 cash to replace a defective tuner.
Required:
Prepare an income statement and statement of cash flows for Daun's first year of operation. Based on the information given, what is Daun's total warranties liability at the end of the accounting period?
Answer:
See below
Explanation:
•Income statement for Daun's first year of operation
Sales revenue
$310,000
Less;
Cost of goods sold
($200,000)
Gross profit
$110,000
Less:
Warranty expense
($9,300)
Net income
$100,700
• Statement of cash flow for Daun's first year of operation
Collection from customers
$310,000
Less:
Paid to suppliers
($200,000)
Warranty payment
($3,420)
Net Cash flow
$106,580
• Daun's Warranty liability/Expense at the end of the accounting period.
= $310,000 × 3%
= $9,300