The following events took place for Rushmore Biking Inc. during February, the first month of operations as a producer of road bikes:

• Purchased $300,000 of materials.
• Used $271,600 of direct materials in production.
• Incurred $78,100 of direct labor wages.
• Applied factory overhead at a rate of 46% of direct labor cost.
• Transferred $365,700 of work in process to finished goods.
• Sold goods with a cost of $348,000.
• Revenues earned by selling bikes, $575,800.
• Incurred $117,100 of selling expenses.
• Incurred $56,900 of administrative expenses.

This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the questions below.

Open spreadsheet

1. Prepare the income statement for Rushmore Biking for the month ending February 28. Round your answers to the nearest dollar.

   Rushmore Biking Inc.
   Income Statement
   For the Month Ended February 28
   Revenues				$
   Cost of Goods Sold
   Gross Profit				$
   Selling and Administrative Expenses:
   Selling Expenses		$
   Administrative Expenses
   Total Selling and Administrative Expenses
   Operating Income				$

2. Determine the inventory balances on February 28, the end of the first month of operations. Round your answers to the nearest dollar.

   Materials inventory, February 28	$
   Work in process inventory, February 28	$
   Finished goods inventory, February 28	$

Calculate gross pay for each of the following employees. All are paid an overtime wage rate that is 1.5 times their respective regular wage rates. NOTE: For simplicity, all calculations throughout this exercise, both intermediate and final, should be rounded to two decimal places at each calculation.

1:Walter Pinkman assembles merchandise and is paid $0.12 for each unit assembled. During the most recent week, he worked 44 hours and assembled 5,602 units. Gross Pay = $

2:Sidney Darling is a telemarketer, who is paid $0.31 for every telemarketing call he places. During the most recent week, he worked 42 hours and placed 1,669 calls. Gross Pay = $

3:Pete Brees assembles merchandise and is paid $0.05 for each unit assembled. During the most recent week, he worked 51 hours and assembled 13,302 units. Gross Pay = $

4:Roy Carter is a telemarketer who is paid $0.36 for every telemarketing phone call he places. During the most recent week, he worked 50 hours and placed 1,564 calls. Gross Pay = $

The following selected accounts and their current balances appear in the ledger of Clairemont Co. for the fiscal year ended May 31, 2016:

Cash	$ 240,000
Accounts Receivable	966,000
Merchandise Inventory	1,712,500
Office Supplies	13,500
Prepaid Insurance	8,000
Office Equipment	830,000
Accumulated Depreciation-Office Equipment	550,000
Store Equipment	3,600,000
Accumulated Depreciation-Store Equipment	1,820,000
Accounts Payable	366,000
Salaries Payable	41,500
Note Payable (final payment due 2022)	300,000
Kristina Marble, Capital	3,449,100
Kristina Marble, Drawing	100,000
Sales	11,343,000
Cost of Merchandise Sold	7,850,000
Sales Salaries Expense	916,000
Advertising Expense	550,000
Depreciation Expense-Store Equipment	140,000
Miscellaneous Selling Expense	38,000
Office Salaries Expense	650,000
Rent Expense	94,000
Depreciation Expense-Office Equipment	50,000
Insurance Expense	48,000
Office Supplies Expense	28,100
Miscellaneous Administrative Expense	14,500
Interest Expense	21,000

	Required:
1.	Prepare a multiple-step income statement. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign.*
2.	Prepare a statement of owner’s equity.*
3.	Prepare a report form of balance sheet, assuming that the current portion of the note payable is $50,000. “Less” or “Plus” will automatically appear if it is required.*
4.	Answer the questions on (a) how multiple-step and single-step income statements differ and (b) how report-form and account-form balance sheets differ.

* Be sure to complete the statement headings. Refer to the problem data and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. A colon (:) will automatically appear if it is required.

QUESTION THREE

Cartlidge Ltd manufactures and sells plastic kitchen containers through associated retail outlets throughout Australia. To compete more effectively it has recently introduced a budgetary control system to assist with planning and control of operations. Detailed below are the budgeted and actual performance figures for their most popular plastic container sold for the month of December 2018,

                                                BUDGET (static)                     ACTUAL

Output (production and sales)    3000 Units                                3,300 Units

                                                $                                              $                     

Sales                                        $45,000                                    $47,850

                                                (3,000 unit @ $15)                    (3,300 units @ $14.50)

Raw Materials                           ($18,000)                                  ($20,140)            

(36,000 units                             (38000 units                                                 @ 50 cents per unit)                        @ 53 cents per unit)                 

Labour                                      ($6,000)                                    ($7,040)            

                                                (300 hours                                (320 hours

                                                @$20 per hour)                         @22 per hour)

Fixed Overheads                       ($5,000)                                    ($4,700)

Operating Profit                        $16,000                                    $15,970

REQUIRED:  

1. Based on the information above calculate a flexed budget based on actual output / sales levels for the month of December 2018                              

2. Describe the purpose of the flexed budget in identifying deviations from planned performance. (limit 60 words)

3. Based on information above reconcile the operating profit under a static budget to the actual operating profit breaking down the reconciliation and identifying specific variances in as much detail as possible.                                                

4. Assuming that the standards were all well set in terms of labor times and rates and material usage and price, suggest one feasible reason for each variance you have identified in (c), from what you know about the company’s performance in December 2018. (HINT: As part of your answer attempt to explain why a favorable variance in one area might explain an unfavorable variance in another area).      (80 word limit)

Cost can be classified in 5 categories-behavior, traceability, controllability, relevance and function. Briefly explain each category.

these videos will help you: https://www.youtube.com/watch?v=NqC0hgdcPuM&feature=youtu.be

https://www.youtube.com/watch?v=0y4cLVZQdOE&feature=youtu.be

The DeVille Company reported pretax accounting income on its income statement as follows:

2021	$	420,000
2022		340,000
2023		410,000
2024		450,000

Included in the income of 2021 was an installment sale of property in the amount of $58,000. However, for tax purposes, DeVille reported the income in the year cash was collected. Cash collected on the installment sale was $23,200 in 2022, $29,000 in 2023, and $5,800 in 2024.

Included in the 2023 income was $24,000 interest from investments in municipal governmental bonds.

The enacted tax rate for 2021 and 2022 was 40%, but during 2022, new tax legislation was passed reducing the tax rate to 25% for the years 2023 and beyond.

Required:
Prepare the year-end journal entries to record income taxes for the years 2021–2024. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

A company may report high net income through a number of means including normal revenues, one-time tax benefits, or other accounting activities. If a company sales merchandise, it is important to understand their operating revenues which will include income statement reporting of both Cost of Goods Sold and Gross Profit on Sales.

Class, what is Cost of Goods Sold? Provide examples of the types of entries recorded to this account. Next, what is Gross Profit on Sales? Why is understanding this section of the Classified Income Statement so important to managers, investors, and creditors?

Exercise 15-13 Adjusting factory overhead LO P4

The following information is available for Lock-Tite Company, which produces special-order security products and uses a job order costing system.
  

	April 30				May 31
Inventories
Raw materials	$	43,500			$	53,000
Work in process		10,300				21,500
Finished goods		63,500				36,600
Activities and information for May
Raw materials purchases (paid with cash)						211,000
Factory payroll (paid with cash)						347,000
Factory overhead
Indirect materials						16,000
Indirect labor						81,000
Other overhead costs						121,000
Sales (received in cash)						1,410,000
Predetermined overhead rate based on direct labor cost						75	%

Determine whether there is over or underapplied overhead.
Prepare the journal entry to allocate (close) overapplied or underapplied overhead to Cost of Goods Sold.

1. Materials purchases (on credit).
2. Direct materials used in production.
3. Direct labor paid and assigned to Work in Process Inventory.
4. Indirect labor paid and assigned to Factory Overhead.
5. Overhead costs applied to Work in Process Inventory.
6. Actual overhead costs incurred, including indirect materials. (Factory rent and utilities are paid in cash.)
7. Transfer of Jobs 306 and 307 to Finished Goods Inventory.
8. Cost of goods sold for Job 306.
9. Revenue from the sale of Job 306.
10. Assignment of any underapplied or overapplied overhead to the Cost of Goods Sold account. (The amount is not material.)

2. Prepare journal entries for the month of April to record the above transactions.

Preparing adjusting entries (annual)—depreciation LO4
Mean Beans, a local coffee shop, has the following assets on January 1, 2017. Mean Beans prepares annual financial statements and has a December 31, 2017 year-end.

On January 1, 2017, purchase equipment costing $15,000 with an estimated life of five years. Mean Beans will scrap the equipment after five years for $0.
On July 1, 2017, purchase furniture (tables and chairs) costing $12,000 with an estimated life of ten years. Mean Beans estimates that it can sell the furniture for $2,000 after ten years.
On January 1, 2015, Mean Beans had purchased a car costing $25,000 with an estimated life of eight years. Mean Beans estimates that it can sell the car for $5,000 after eight years.
Assume Mean Beans, uses Straight Line Method to depreciate the asset.

Required
For each transaction, calculate the annual depreciation expense and record the adjusting entry on December 31, 2017.
For the car, determine the accumulated depreciation as of December 31, 2017.
For the car, determine the carrying amount as of December 31, 2017.

A man is looking to purchase a home in the Cleveland Suburbs. He has enough for a 20% down payment and an income of $70,000 per year. His FICO Score is 660. The prime Interest Rate for 30-year Mortgages is 5%. He has a car payment of $400 per month and a Student Loan Payment of $200 per month. The home he finds has 70 Effective Property Tax Mills and Homeowner’s Insurance Costs $50 per month on every $100,000 of Home Value. How much can the man pay for the home? How large of a mortgage will the bank allow him take out?

Please write steps. thank you

Flounder Corporation leased equipment to Shamrock, Inc. on January 1, 2020. The lease agreement called for annual rental payments of $1,276 at the beginning of each year of the 3-year lease. The equipment has an economic useful life of 7 years, a fair value of $7,600, a book value of $5,600, and Flounder expects a residual value of $5,100 at the end of the lease term. Flounder set the lease payments with the intent of earning a 8% return, though Shamrock is unaware of the rate implicit in the lease and has an incremental borrowing rate of 10%. There is no bargain purchase option, ownership of the lease does not transfer at the end of the lease term, and the asset is not of a specialized nature.

What is the amount of the rental payments used in the lease agreement?

Prepare the entries for Flounder for 2020.

How would Flounder’s accounting in part a change if it incurred legal fees of $900 to execute the lease documents and $600 in advertising expenses for the year in connection with the lease?

Please answer the following question:

research “survivor syndrome” and what specific companies have done to successfully

mitigate this response and regain full employee commitment. Provide two companies as examples and discuss your findings.

Selected information from Rockway, Inc.’s U.S. GAAP financial statements for the year ended December 31, included the following (in $):

	2004	2005
Sales	17,000,000	21,000,000
Cost of Goods Sold	11,000,000	15,000,000
Interest Paid	800,000	1,000,000
Current Income Taxes Paid	700,000	1,000,000
Accounts Receivable	3,000,000	2,500,000
Inventory	2,400,000	3,000,000
Property, Plant & Equip	2,000,000	16,000,000
Accounts Payable	1,000,000	1,400,000
Long-term Debt	8,000,000	9,000,000
Common Stock	4,000,000	5,000,000

Cash provided or used by operating activities (CFO) in the year 2005 was closest to:

Group of answer choices

A. $6,300,000.

B. $5,300,000.

C. $4,300,000.

Assume that credit sales "to be received in 90 days" are received in exactly 90 days and that EFT wage payments are made in exactly 7 days. Expected to pay income tax of 35%? And its journal entries CR and DR

01-January-2016	Open business bank account with transfer of personal funds	$210,000
02-January-2016	EFT for rental of office space. Immediate occupancy. 60 months at $3500 per month.	$210,000
11-January-2016	Office equipment purchased for cash to get discount from the retail price of $56,000.	$50,000
11-January-2016	The office equipment will be replaced in 5 years at an expected cost of $67,000.	$67,000
13-January-2016	Bank loan approved and credited to account. Payable in 2021	$310,000
28-June-2016	Credit sales. EFT payment to be received in 90 days.	$65,500
04-July-2016	Employee timesheets submitted for work performed. Payment (EFT) to be made in 7 days.	$5,200
29-July-2016	Cash sales.	$33,500
12-December-2016	Credit sales. EFT payment to be received in 90 days.	$42,500
28-December-2016	Employee timesheets submitted for work performed. Payment (EFT) to be made in 7 days.	$5,720

1. Internal control procedures are important in every business. At what stage in the development of a business do they become especially critical? Is there one area of the business (cash, receivables, inventory) where the procedures are the most critical, and why do you think that area is the most important?

2. You are investing in a company. Would you rather invest in common stock, convertible preferred stock, non-cumulative preferred stock, or cumulative preferred stock? Please explain your choice.

3. A company can finance their company in many ways - short-term debt, long-term borrowing, selling bonds, issuing stock. What do you think is a good mix for the company to have, and why? What might influence the mix for a company?