Answer:
Effect on income= $2,600 increase
Explanation:
Giving the following information:
It costs Garrison Company $9.50 of variable costs.
A foreign wholesaler offers to purchase 2,600 scales at $12.20 each. Garrison will incur special shipping costs of $1.70 per scale if the order is accepted.
Because it a special offer and there is unused capacity, we will not take into account the fixed costs:
Effect on income= units sold*contribution margin per unit
Effect on income= 2,600*(12.2 - 9.5 - 1.7)
Effect on income= $2,600 increase
You expect to receive a payment of $600 one year from now. Answer the following questions and show your calculations:
A. The discount rate is 6%. What is the present value of the payment to be received?
B. Suppose that the discount rate rises to 7%. What is the present value of the payment to be received?C. What will cause the present value of a future payment to decline?
Answer:
Instructions are below.
Explanation:
Giving the following information:
You expect to receive a payment of $600 one year from now.
A) Discount rate= 6%
We need to use the following formula:
PV= FV/(1+i)^n
PV= 600 / (1.06)= $566.04
B) Discount rate= 7%
PV= 600 / (1.07)= $560.75
C) The future value of a certain cash flow declines when the interest rate (discount rate) increases or "n" (time) increases.
From the perspective of manufacturers, standardization means:
A. making identical, interchangeable components or complete products.
B. making the exact product a particular customer needs or wants.
C. ensuring that each product is sold at the same price.
D. meeting the benchmark set by a market leader.
E. ensuring that one's product has the exact same features as that of a competitor.
Answer:
The correct answer is the option A: making indentical, interchangeable components or complete products.
Explanation:
To begin with, the concept of standardization in the field of business is a process that involves the fact of being certain aspects that need to be done in order to accomplish the same goal. In the case of the manufacturers, it means that they need to make every good the same, therefore that it means making identical, interchangeable components or complete products as well in order to keep everytime the same results.
Answer:
A. making identical, interchangeable components or complete products.
Explanation:
From the manufacturer's point of view standardisation is the process by which goods and services are produced according to standards based on consensus between all parties in an industry.
Standardisation ensures that there is a consistent quality between products In the same industry.
So products are identical, interchangeable components or complete products based on the standard that guides production.
The various stakeholders considered in setting standards are users, governments, corporations, and standards organisations
Which of the following ethics failures at HSBC is most likely an illegal activity regulated by governments? a. HSBC instructed Iranian bank how to conceal millions of dollars transactions b. HSBC cut the number of internal watchdogs to save money c. HSBC ranked Mexico in its "lowest risk" category for money laundering d. HSBC failed to identify suspicious activity
Answer:
A
Explanation:
Money laundering is an illegal act of concealing the proceeds of an illegal act by passing it through a series of complex transaction in order to hide its criminal source. This is illegal as it helps criminals to actively benefit from crime.
The government is highly interested in this , and to curtail it , it introduced the money laundering acts.
The instruction to Iranian bank by HSBC on how to conceal millions of dollars transaction is a form of collusion and aiding money laundering which is also an illegal activity.
The Wilson Company purchased $35,000 of merchandise from the Poole Wholesale Company. Wilson also paid $2,800 for freight costs to have the goods shipped to its location.Which of the following statements regarding the necessary entries for the transactions is true? Wilson uses a perpetual inventory system.
A. Total debits to the inventory account would be $37,800.
B. Total debits to the inventory account would be $35,000.
C. Transportation-in would be debited for $2,800.
D. Total debits to the inventory account would be $2,800
Answer:
Option A, total debits to the inventory account would be $37,800, is correct
Explanation:
The cost of the merchandise inventory to Wilson Company is the cost of the inventory purchased and the freight-in cost.
In other words, the amount to be recognized in merchandise inventory account is the sum of both amounts i.e $35,000+$2800=$37,800
This would be debited to merchandise inventory and $2,800 would be credited to the cash account while $35,000 is credited to accounts payable
Required information
Use the following information for Quick Studies below.
[The following information applies to the questions displayed below.]
The following is the adjusted trial balance of Sierra Company.
Account Title Debit Credit
Cash $ 35,000
Prepaid insurance 2,000
Notes receivable (due in 5 years) 7,000
Buildings 95,000
Accumulated depreciation–Buildings $ 27,000
Accounts payable 10,000
Notes payable (due in 3 years) 10,500
H. Sierra, Capital 33,000
H. Sierra, Withdrawals 8,500
Consulting revenue 84,500
Wages expense 5,000
Depreciation expense–Buildings 9,500
Insurance expense 3,000
Totals $ 165,000 $ 165,000
Question Requirement:
Use the information adjusted trial balance to prepare Sierra Company's classified balance sheet as of December 31. SIERRA COMPANY Balance Sheet December 31:
Answer:
SIERRA COMPANY Balance Sheet December 31:
Current Assets:
Cash $35,000
Prepaid insurance 2,000 $37,000
Long-Term Assets:
Notes receivable (due in 5 years) 7,000
Buildings 95,000
Accumulated depreciation 27,000 68,000 $75,000
Total Assets $112,000
Current Liabilities:
Accounts payable 10,000
Long-term Liabilities:
Notes payable (due in 3 years) 10,500 $20,500
H. Sierra, Capital $33,000
H. Sierra, Withdrawals 8,500 24,500
Retained Earnings 67,000 $91,500
Total Liabilities + Equity $112,000
Explanation:
a) Sierra Company's Income Statement:
Consulting revenue $84,500
Wages expense -5,000
Depreciation expense–Buildings -9,500
Insurance expense -3,000
Net Income $67,000
b) Here, the Net Income is equal to the Retained Earnings, which is carried forward.
c) To prepare a balance sheet, which contains permanent accounts, the temporary accounts or periodic accounts must be eliminated in the Income Statement summary. The resulting figure is then carried forward to the balance sheet. Permanent accounts are the accounts that are carried forward to the next accounting period. They are stated in the balance sheet according to their various assets, liabilities, and equity classifications.
Based on the given data, the net income will be $67,000
Current Assets:
Cash $35,000
Prepaid insurance 2,000 $37,000
Long-Term Assets:
Notes receivable (due in 5 years) 7,000
Buildings 95,000
Accumulated depreciation 27,000 68,000 $75,000
Total Assets $112,000
Current Liabilities:
Accounts payable 10,000
Long-term Liabilities:
Notes payable (due in 3 years) 10,500 $20,500
H. Sierra, Capital $33,000
H. Sierra, Withdrawals 8,500 24,500
Retained Earnings 67,000 $91,500
Total Liabilities + Equity $112,000
a) Income Statement of Sierra Companies-
Consulting revenue $84,500
Wages expense -5,000
Depreciation expense–Buildings -9,500
Insurance expense -3,000
Net Income $67,000
Learn more about net income, here:
https://brainly.com/question/14126418
#SPJ6
Internal Controls for Bank Lending
Pacific Bank provides loans to businesses in the community through its Commercial Lending Department. Small loans (less than $100,000) may be approved by an individual loan officer, while larger loans (greater than $100,000) must be approved by a board of loan officers. Once a loan is approved, the funds are made available to the loan applicant under agreed-upon terms. Pacific Bank has instituted a policy whereby its president has the individual authority to approve loans up to $5,000,000. The president believes that this policy will allow flexibility to approve loans to valued clients much quicker than under the previous policy.
Answer the following True or False questions related to the scenario.
1. All loans have the same element of risk, so it doesn't matter if the loan is large or small.
2. Allowing the bank president to have sole authority to grant large loans is fine since he or she is president.
3. Large loans present greater risk in the event of default, therefore you should have more than one person involved in making the decision to grant a large loan.4. Having one person grant loans is good internal control.
Answer:
1. False
The higher the figure, the higher the risk. Kindly note that loans are usually insured against default. The higher the amount insured, the higher the premium payable as insurance on such amounts.
2. False
It does not make for good internal control to have one person regardless of their position to have the final say on loans of great magnitude such as $5 Million. This can quickly degenerate into a situation where the officer involved is tempted to abuse that power. It makes for good corporate governance and risk management to ensure that the board is responsible for loans of such magnitude.
3. True
If a bank lost $100 in a thousand places, from loan default, that translates to a loss of $100,000. This relatively is large however it is small and will have less impact that a loss of a million dollars in 3 places. That's $ 3,000,000.
As already indicated, it makes for good loan disbursement governance, to ensure that there is at least two persons involved in the risk acceptance criteria (RAC) evaluation and loan disbursement process.
4. False
Separation of duties is the foundation of good internal control. It allows for greater objectivity. It is also key to carefully select signatories to loan disbursements. They have to be people of impeccable character and the company must exercise proper risk management to ensure that every protocol such as opportunity that may create the impulse or inclination to breach policy is removed completely.
Cheers!
Developing and evaluating solutions to reduce the gap between desired process performance and current performance is the final step in the six sigma DMAIC approach for process improvement. True False
Answer: False
Explanation:
The six sigma DMAIC approach for process improvement is a way of improving performance in such a way that it makes the company more profitable as well as improving customer relations and satisfaction.
The DMAIC is an acronym that stands for the the steps in the process as seen in the graph attached.
The above statement about Developing and Evaluating Solutions to make a company perform better is not the final step in the process as it falls under the fourth step, which is to Improve.
The final step is Control. Here the main focus is on preserving what has been achieved. It works by monitoring the situation and ensuring that the process improves if a loophole is spotted.
Suppose that, in a competitive market without government regulations, the equilibrium price of rental cars is $58 per day.Complete the following table by indicating whether each of the statements is an example of a price ceiling or a price floor and whether it is binding or nonbinding.Statement Price Control and Binding or NotThe government prohibits car-rental companies from renting out rental cars for more than $87 per day. Price Control (Price Ceiling Or Price Floor)?_______ Binding or Not Binding?_______Due to new regulations, car-rental companies that would like to pay better wages in order to hire more workers are prohibited from doing so. Price Control (Price Ceiling Or Price Floor)?_______ Binding or Not Binding?_______The government has instituted a legal minimum price of $87 per day for rental cars. Price Control (Price Ceiling Or Price Floor)?_________ Binding or Not Binding?_______
Answer:
1. Price ceiling non binding
2. Price ceiling, binding
3. Price floor binding
Explanation:
A price ceiling is when the government or an agency of the government sets the maximum price for a good or service.
Price ceiling is binding if it is set below equilibrium price.
A price floor is when the government or an agency of the government sets the minimum price for a good or service.
Price floor is binding when it is set above minimum price.
If equilibrium price is $58 and the maximum price set by the government is $87. This is a price ceiling but it is not binding because it is above equilibrium price.
If the minimum price is $87. It is an example of A price floor and it is binding because it is set above equilibrium price.
If car rentals want to pay their workers more but can't do it because of new regulations, I it means it's a price ceiling and it is binding.
I hope my answer helps you
The First National Bank of Nelsonville has no excess reserves when a new deposit of $10,000 is made. The required reserve ratio for all banks is 5 percent. How much is the largest possible increase in checking account balances throughout the entire banking system
Answer:
$950
Explanation:
Reserve ratio is defined as the percentage amount of deposit that a bank is instructed by the governing central bank to keep as cash reserve. This is used to control the money supply in the economy as the the check - able amount that are subjected to withdrawal is limited to the funds available after the reserve ratio has been considered.
Workings
New deposit - $10,000
Required reserve ratio - 5%
No existing excess ratio as at the time of deposit.
Reserve ratio - 5%*10000 = 50
Increase in checking account = 1000-50
= $950
Some characteristics of teams are that:
A. each team usually consists of 12 to 20 section housekeepers.
B. each team is directly supervised by the executive housekeeper.
C. each team usually has two or more housepersons.
D. each houseperson inspects the guestrooms after they have been cleaned.
E. each team usually has one supervisor and one houseperson.
Answer:
Some characteristics of teams are that:
B. each team is directly supervised by the executive housekeeper.
E. each team usually has one supervisor and one house-person.
Explanation:
To facilitate the effective discharge of duties in a hotel housekeeping operations, teams are usually formed. Each team consists of one supervisor, one house-person and three to five guest room attendants. The performance of the team is checked by the entire team members and not just one person.
The executive housekeeper is charged with the responsibility of ensuring that the to-do-list is followed to the latter. He leads the department. Teams are important as they release the workload on the manager and the group has more flexibility while working.
Attendants should be given appraisals for their effort. This would serve as a reward for hard-working teams and a morale boost to low performing teams.
ABC company has just purchased a life truck that has a useful life of 5 years. The engineer estimates that maintenance costs for the truck during the first year will be $1,000. As the truck ages, maintenance costs are expected to increase at a rate of $300 per year over the remaining life. Assume that the maintenance costs occur at the end of each year. The firm wants to set up a maintenance account that earns 12% interest per year. All future maintenance expenses will be paid out of this account. How much does the firm have to deposit in the account now
Answer:
Total amount to be invested today =$1,706.432
Explanation:
The first maintenance cost would occur a year from now, then the Present value will be equal to :
PV = 1,000 × 1.12^(-1)
PV = 892.857
The rest of the maintenance cost represents an annuity .
We will determine the PV of the annuity of $300 discounted at 12% per annum starting in year 2
PV = A × 1- (1+r)^(-n)
A- 300, r= 12%, n= 4
PV in year 1 = 300 × 1 - (1.12)^(-4)= 911.204804
PV in year 0= F × (1+r)^(-n)
= 911.204804 × 1.12^(-1)= 813.57
Total amount to be invested today = 813.57 + 892.85=1706.43
Total amount to be invested today =$1,706.432
According to the company's records, the conversion cost in beginning work in process inventory was $15,264 at the beginning of June. Additional conversion costs of $68,208 were incurred in the department during the month. What was the cost per equivalent unit for conversion costs for the month? (Round off to three decimal places.)
Answer:
$0.873
Explanation:
Limber Company
Calculation of cost per equivalent unit for conversion costs for the month:
Units transferred:
Begining Work in process 18,000
Add Units started into production during the month 81,000
Less Ending Work in process (17,000)
Units completed and transferred out during the month 82,000
The Equivalent units of production
Conversion
Transferred to next department 82,000
Add Ending work in process 13,600
( 17,000 units × 80% complete
Equivalent units of production 95,600
Cost per Equivalent Unit
Conversion
Cost of beginning work in process $15,264
Add Cost added during the period 68,208
Total cost $83,472
Equivalent units of production $95,600
Cost per equivalent unit:
Total units/Equivalent units of production
Hence:
$83,472/$95,600
=$0.873
The current sections of Sandhill Co.'s balance sheets at December 31, 2021 and 2022, are presented here. Sandhill Co's net income for 2022 was $137,700. Depreciation expense was $24,300. 2022 2021 Current assets $89,100 Cash $94,500 Accounts receivable 72,000 80,100 151,200 Inventory 154,800 Prepaid expenses 24,300 19.800 $342000 $343,800 Total current assets Current liabilities Accrued expenses payable $13,500 $4,500 Accounts payable 76,500 82800 $90,000 Total current liabilities $87.300
Prepare the net cash provided (used) by operating activities section of the company's statement of cash flows for the year ended December 31, 2022, using the indirect method.
Answer and Explanation:
The prepartion of the net cash provided or used by operating activities section of the cash flow statement is presented below:
Cash flows from operating activities
Net income $137,700
Adjustments made
Depreciation expense $24,300
Add: Decrease in Accounts receivable $8,100 ($72,000 - $80,100)
Add: Decrease in inventory $3,600 ($151,200 - $154,800)
Less: Increase in Prepaid expenses -$4,500 ($24,300 - $19,800)
Add: Increase in accrued expenses payable $9,000 ($13,500 - $4,500)
Less: Decrease in accounts payable -$6,300 ($76,500 - $82,800)
Total of adjustments $34,200
Net cash provided by operating activities $171,900
The negative sign represents cash outflow and positive sign represents cash inflow
On January 1, Hurley Corporation issues $500,000, 5-year, 12% bonds at 96 with interest payable on January 1. The entry on January 1 to record payment of bond interest assuming amortization of bond discount used the straight-line method will include a:_______.a. credit to Discount on Bonds Payable $4,000. b. credit to Cash $60,000. c. debit to Interest Expense $60,000. d. debit to Interest Expense $30,000.
Answer:
b. credit to Cash $60,000.
Explanation:
Given that:
Hurley Corporation issues the principal amount of $500,000
Time = 5 years
Rate = 12% at 96 with interest payable on January 1
Discount on issue =500000 × (1 - 0.96) = 20000
Annual discount amortization= 20000/5 = 4000
Interest payable = 500000× 12% = 60000
From the information given in the question; we can have a journal entry to determine the what the straight-line method will include.
So, let have a look at the table below:
Discount on issue 20000
Annual discount 4000
amortization
Debit Credit
Interest expense 64000
Discount on Bonds payable 4000
Interest payable 60000
Now; The January 1 entries will now be as follows:
Debit Credit
Interest payable 60,000
Cash 60,000
Thus; The entry on January 1 to record payment of bond interest assuming amortization of bond discount used the straight-line method will include a: Credit to cash $60,000
g Price ($) Qd Qs 40 150 120 50 130 130 60 110 150 70 100 170 80 90 180 Farmington: Price ($) Qd Qs 40 310 190 50 300 220 60 290 250 70 280 280 80 270 310 What is the equilibrium price and quantity for each country?
Answer:
First country
Equilibrium price = 50
Equilibrium quantity = 130
Farmington
Equilibrium price = 70
Equilibrium quantity = 280
Explanation:
Equilibrium price is where the quantity demanded is equal to the quantity supplied.
Equilibrium quantity is the quantity at which quantity demanded is equal to quantity supplied.
For the first country, the equilibrium price is 50 because that is where quantity supplied equals quantity demanded.
Equilibrium quantity = 130
For Farmington
Equilibrium price is 70
Equilibrium quantity is 280
I hope my answer helps you
According to supply-side fiscal policy, increasing tax rates on wages and profits will: Group of answer choices result in higher unemployment and inflation. reduce both unemployment and the price level. lower the price level but raise unemployment. increase the real output as well as the price level.
Answer:
The correct answer is the third option: lower the price level but raise unemployment.
Explanation:
To begin with, supply-side fiscal policies are the ones that tend to benefit the supply that an economy puts with the purpose of increasing it believing that the raise of it will cause an increase in the level of production of the economy. Secondly, if tax rates on wages and profits increase then the firms will have less income in order to hire more workers to produce more and therefore that the level of unemployment will increase. And if the unemployment increases then the price level will decrease due to the fact that the firms will not have many workers to pay and therefore they will lower the prices in order to sell more because of its low costs regarding wages
A manufacturing company preparing to build a new plant is considering three potential locations for it. The fixed and variable costs for the three alternative locations are presented below.
a. complete a numeric locational cost-volume analysis
b. Indicate over what range each of the alternatives A, B, C is the low-cost choice
c. Is any alternative never perferred? Explain
Cost A B C
Fixed ($) 2,500,000 2,000,000 3,500,000
Vaiable ($ per unit) 21 25 15
Answer:
Explanation:
Total cost is equal to fixed cost (the cost that does not vary with the amount of products manufactured) + variable cost
Fixed cost in this case, is the cost of building a new plant in either location.
The volume of production of this manufacturing company should be given but since it is absent, we will assume a uniform volume which is 50 units. This is quantity or number of products manufactured.
From the information provided in the question, we can derive the total cost function for each location.
Location A
TC = $2,500,000 + $21Q
Location B
TC = $2,000,000 + $25Q
Location C
TC = $3,500,000 + $15Q
Testing the level of total cost for each location, we can use the uniform quantity of 50 units. This will fetch the following levels of total cost for the locations:
Location A - $2,501,050
Location B - $2,001,250
Location C - $3,500,750
From this, we can tell the costliest location is LOCATION C. The low-cost choice is LOCATION B.
If in actual fact, the quantity of products produced in each location is different, not uniform, use the different quantities to calculate the total cost of producing at each location.
For each of the following separate transactions,
(a) prepare the reconstructed journal entry and
(b) identify the effect it has, if any, on the investing section or financing section of the statement of cash flows.
1. Sold a building costing $30,000, with $20,000 of accumulated depreciation, for $8,000 cash, resulting in a $2,000 loss.
2. Acquired machinery worth $10,000 by issuing $10,000 in notes payable.
3. Issued 1,000 shares of common stock at par for $2 per share.
4. Notes payable with a carrying value of $40,000 were retired for $47,000 cash, resulting in a $7,000 loss
Answer: The answer is provided below
Explanation:
a. The reconstructed journal entry has been prepared and attached.
b. The following are the effects it has on the investing section or the financing section of the statement of cash flows.
The first transaction will lead to a cash inflow of $8,000 from the investing activities.
The second transaction is non-cash transaction therefore, it will not be reported in either the financing or the investing activities.
The third transaction will lead to a cash inflow of $2,000 from the financing activities.
The fourth transaction will lead to a cash outflow from the financing activities.
Thw diagram has been attached.
Your current income is equal to 40,000
Your next period (future) income is known to be equal to 44,000.
If your current consumption expenditure is equal to 32,000, what is your (current) level of savings?
If the real rate of interest is equal to 15%, how much will you spend on consumption next period (assuming that your current consumption is 32,000)?
Answer: The answer is given below
Explanation:
Assume that the individual lives for two periods which are present and future.
The individual savings in the present period will be:
= current income - current consumption
= 40000- 32000
= 8000
Interest income earned on the savings:
= 15% of savings
= 0.15 × 8000
= 1200
Therefore, the consumption in future period will be the sum of the next period income, the savings from current period and interest income that is earned on the savings.
Consumption in next period:
= 44000 + 8000 + 1200
= 53200
Global Services is considering a promotional campaign that will increase annual credit sales by $570,000. The company will require investments in accounts receivable, inventory, and plant and equipment. The turnover for each is as follows: Accounts receivable 3 times Inventory 6 times Plant and equipment 1 time All $570,000 of the sales will be collectible. However, collection costs will be 3 percent of sales, and production and selling costs will be 70 percent of sales. The cost to carry inventory will be 6 percent of inventory. Depreciation expense on plant and equipment will be 5 percent of plant and equipment. The tax rate is 30 percent. a. Compute the investments in accounts receivable, inventory, and plant and equipment based on the turnover ratios. Add the three together.
Answer:
The investments in accounts receivable, inventory, and plant and equipment based on the turnover ratios would be the following:
Accounts receivable is $190,000
Inventory is $95,000
Plant and equipment is $570,000
The Total would be of $855,000
Explanation:
According to the given data we have the following:
Global Services is considering a promotional campaign that will increase annual credit sales by $570,000.
Therefore, in order to calculate the the investments in accounts receivable, inventory, and plant and equipment based on the turnover ratios we would have to make the following calculations:
Accounts receivable=$570,000/3=$190,000
Inventory=$570,000/6=$95,000
Plant and equipment=570,000/1=$570,000
Therefore, the Total would be of $855,000
Two firms are planning to sell 10 or 20 units of their goods and face the payoff matrix illustrated to the right. What is the Nash equilibrium if both firms make their decisions simultaneously? What strategy does each firm use? A. The game does not have a Nash equilibrium. B. The Nash equilibria are for Firm 1 to produce 10 and Firm 2 to produce 20 and for Firm 1 to produce 20 and Firm 2 to produce 10. C. The Nash equilibrium is for Firm 1 to produce 20 and Firm 2 to produce 10. D. The Nash equilibrium is for Firm 1 and Firm 2 each to produce 10. E. The Nash equilibrium is for Firm 1 to produce 10 and Firm 2 to produce 20
Answer:
D. The Nash equilibrium is for Firm 1 and Firm 2 each to produce 10.
Explanation:
Firm 2
10 units 20 units
10 units 30 / 50 /
Firm 1 30 35
20 units 40 / 20 /
60 20
(firm 1 /
firm 2)
Firm 1's dominant strategy would be to sell 10 units with an expected payoff outcome = 30 + 50 = 80
Firm 2's dominant strategy would be to sell 10 units with an expected payoff outcome = 30 + 60 = 90
Since both firms have the same dominant strategy (to produce 10 units), there is a Nash Equilibrium where both firms produce 10 units and each one earns 30.
Preparing statement of cash flows LO P2, P3.Use the following information of VPI Co to prepare a statement of cash flows for the year ended December 31 using the indirect method. (Amounts to be deducted should be indicated by a minus sign) Cash best prior year-end $40,000Increase in inventory 5.400 Depreciation expense 4,400 Cash received from using stock 8.600 Cash paid for dividende 1,400Gain on Sale of machinery 2,100 Cash received from sale of inventory 9.700 Increase in account payable 1,700 Net Increase 27.000 Decrease in account payable 3.000 VPI CO. Statement of Cash Flows (Indirect Method) For Current Year Ended December 31 Cash flows from operating activities Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities $ 0 rences Cash flows from investing activities $0 Cash flows from financing activities $0
Answer:
$85,500
Explanation:
VPI CO. Statement of Cash Flows (Indirect Method) For Current Year Ended December 31
Cash flows from operating activities
Net Income $ 27,000
Adjustment to reconcile net income to net cash provided by operating activities:
Income statement items not affecting cash
Depreciation expnese $ 4,400
Gain on sale of machinery $ (2,100)
Changes in current operating assets and liabilities:
Increase in inventory $ (5,400)
Increase in accounts payable $ 1,700
Decrease in accounts receivable $ 3,000
Net cash generated from operating activities $ 28,600(A)
Cash flow from investing activities:
Cash received from sale of Inventory $ 9,700
Net cash generated from investing activities $ 9,700 (B)
Cash flow from financing activities:
Cash received from issuing stock $8,600
Cash paid for dividends $ (1,400)
Net cash generated from financing activities (8,600-1,400) $ 7,200 (C)
Net increase in cash and cash equivalents (A+B+C) $ 45,500
Add: Beginning cash balance $40,000
Ending cash balance $85,500
Primo Industries collected $105,000 from customers in 2019. Of the amount collected, $25,000 was for services performed in 2018. In addition, Primo performed services worth $40,000 in 2019, which will not be collected until 2020. Primo Industries also paid $72,000 for expenses in 2019. Of the amount paid, $30,000 was for expenses incurred on account in 2018. In addition, Primo incurred $42,000 of expenses in 2019, which will not be paid until 2020.
Required:
a. Compute 2014 cash-basis net income.
b. Compute 2014 accrual-basis net income.
Answer:
a. $33,000.
b. $36,000.
Explanation:
Net income is calculated as sales minus cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses. It is also called net earnings.
Now, Cash accounting recognizes revenue and expenses only when money changes hands, but accrual accounting recognizes revenue when it's earned, and expenses when they're billed (but not paid).
a. 2014 Cash-basis net income:
Primo Industries collected $105,000 from customers in 2019
Primo Industries also paid $72,000 for expenses in 2019
=105,000-72,000
=$33,000
b. 2014 accrual-basis net income.
=(105,000-25000+40000)-(72000-30000+42000)
=120000-84000
=$36,000
Since 2005, publicly traded companies in the European Union have been required to use IFRS in preparing their consolidated financial statements. What is the EU's objective in requiring the use of IFRS
Answer:
Comparability of Financial Statements in different jurisdictions
Explanation:
The reason is that if the IFRC is successful in achieving this then it will help the investor to make more informed decisions and gain maximum out of the investment and all this is only possible by enhanced comparability of the financial statements in different jurisdictions.
Record the following transactions of J. Min Designs in a general journal assuming that they use the periodic system. DATE TRANSACTIONS 2013 April 1 Purchased merchandise on credit from O’Rourke Fabricators, Invoice 885, $3,000, terms 1/10, n/30; freight of $20 prepaid by O’Rourke Fabricators and added to the invoice (total invoice amount, $3,020). 9 Paid amount due to O’Rourke Fabricators for the purchase of April 1, less the 1 percent discount, Check 457. 15 Purchased merchandise on credit from Kroll Company, Invoice 145, $1,250, terms 1/10, n/30; freight of $75 prepaid by Kroll and added to the invoice. 17 Returned damaged merchandise purchased on April 15 from Kroll Company; received Credit Memorandum 332 for $50. 24 Paid the amount due to Kroll Company for the purchase of April 15, less the return on April 17, taking the 1 percent discount, Check 470.
Answer and Explanation:
According to the scenario, the journal entry of the given data are as follow:-
Journal Entry
On April 1
Purchase A/c Dr. $3,000
Freight-in A/c Dr. $20
To Accounts payable A/c $3,020
(Being the purchased merchandise from O’Rourke fabricators)
For recording this we debited the purchased and freight in as it increased the expenses and credited the account payable as it increased the liability
On April 9
Accounts payable A/c Dr. $3,020
To Purchase discount A/c($3,000 × 1%) $30
To Cash A/c ($3,000 × 99%) + $20 $2,990
(To Record the accounts payable on discount)
For recording this we debited the account payable as it decreased the liabilities and credited the purchased discount and cash as it increased the discount and reduced the cash
On April 15
Purchase A/c Dr. $1,250
Freight-in A/c Dr. $75
To Accounts payable A/c $1,325
(To Record the purchased merchandise from kroll company)
For recording this we debited the purchased and freight in as it increased the expenses and credited the account payable as it increased the liability
On April 17
Accounts payable A/c Dr. $50.24
To Purchase return A/c $50.24
(To Record the purchase return of damaged merchandise)
For recording this we debited the account payable as it decreased the liabilities and credited the purchased return as it increased the return
April 24
Accounts payable A/c($1,325 - $50.24) Dr. $1,274.76
To Purchase discount A/c(1,250 - 50.24) × 1% $11.998
To Cash A/c($1,250 - $50.24) × 99% + $75 $1,262.76
(To Record the paid amount on discount to kroll company)
For recording this we debited the account payable as it decreased the liabilities and credited the purchased discount and cash as it increased the discount and reduced the cash
Consider the following transactions.
1. Receive cash from customers, $16,700.
2. Pay cash for employee salaries, $10,700.
3. Pay cash for rent, $4,700.
4. Receive cash from sale of equipment, $9,700.
5. Pay cash for utilities, $2,700.
6. Receive cash from a bank loan, $5,700.
7. Pay cash for advertising, $8,700.
8. Purchase supplies on account, $4,700.
Required:
Post transactions to the Cash T-account and calculate the ending balance.
Answer and Explanation:
The posting of transactions to the cash t- account is shown below:
Cash Account
Particulars Amount Particulars Amount
Beginning balance $0 Salaries expense $10,700
Accounts receivable $16,700 Rent expense $4,700
Sale of equipment $9,700 Utilities expense $2,700
Bank loan $5,700 Adverting expense $8,700
Ending balance (Bal. fig) $5,300
Total $32,100 Total $32,100
We assume that the beginning balance of cash is zero and according to that we find out the closing balance of cash
Suppose that you make a series of annual deposits into a bank account that pays 12% interest. The initial deposit at the end of the first year is $1,200. The deposit amounts increase by $600 in each of the next 5 years. How much would you have immediately after the 6th deposit
Answer:
$20,314.17
Explanation:
To find the 6th deposit, we use the future value formula for each yearly payment.
PV(1 + i) FV
FV (year 1) = $1200(1 + 0.12)5 = $2114.81
FV (year 2) = $1800(1 + 0.12)4 = $2832.33
FV (year 3) = $2400(1 + 0.12)3 = $3371.83
FV (year 4) = $3000(1 + 0.12)2 = $3763.2
FV (year 5) = $3600(1 + 0.12)1 = $4032
PV (year 6) = $4200
Total amount you will have after the 6th deposit is = $20,314.17
When Nancy's aunt left for her annual Christmas vacation, she left Nancy in charge of her coffee shop. During this time, there was a riot in the city and the door of the café got damaged. Under such circumstances, Nancy can make necessary repairs if she cannot reach her aunt for further instructions because she has:_________.
A. express authority.
B. power of attorney.
C. apparent authority.D. inherent agency power
Answer:
inherent agency power
Explanation:
pls mark brainliest
A 20-year bond of a firm in severe financial distress has a coupon rate of 12% and sells for $885. The firm is currently renegotiating the debt, and it appears that the lenders will allow the firm to reduce coupon payments on the bond to one-half the originally contracted amount. The firm can handle these lower payments. What is (a) the stated and (b) the expected yield to maturity of the bonds? The bond makes its coupon payments annually. (Do not round intermediate calculations. Round your answers to 3 decimal places.)
Answer:
(a) Using Microsoft excel, the stated yield is 4.04%
(b) The expected yield of the maturity bonds is 4.03%
Explanation:
The yield to maturity (YTM) on 1-year zero-coupon bonds is 7% and the YTM on 2-year zeros is 8%. The yield to maturity on 2-year-maturity coupon bonds with coupon rates of 14% (paid annually) is 7.9%. a. What arbitrage opportunity is available for an investment banking firm? The arbitrage strategy is to buy zeros with face values of $ 140 and $ 1140 , and respective maturities of one year and two years. b. What is the profit on the activity? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Answer:
(a) The arbitrage strategy is to buy zeros with face values of $140 and $1,140 and respective maturities of one and two years, and simultaneously sell the coupon bond.
(b) The profit on the activity equals $0.72 on each bond.
Explanation:
The price of the coupon bond = 140 × PV(7.9%, 2) + 1000 × PV(7.9%, 2)
= 140 × (1-(1/1.079)^2)/0.079 + 1,000/1.079^2
= $1,108.93
If the coupons were withdrawn and sold as zeros individually, then the coupon payments could be sold separately on the basis of the zero maturity yield for maturities of one and two years.
[140/1.07] + [1,140/1.08^2] = $1,108.21.
The arbitrage strategy is to buy zeros with face values of $140 and $1,140 and respective maturities of one and two years, and simultaneously sell the coupon bond.
The profit on the activity equals $0.72 on each bond.
