S Company reported the following account balances on its After Closing Trial Balance     

                                        (DR = Debit/CR = Credit)

Bonds Payable                     $7,000  CR                  

Supplies                                 $7,000 DR

Accounts Receivable           $1,000   DR               

Accounts Payables              $5,000   CR

Building & Land                 $13,000   DR             

Retained Earnings              $4,000   DR

Cash                                     $5,000   DR                 

Discount-Bonds Payable    $2,000 DR

If $4,000 of the Accounts Payable were paid using cash, what would be the debt ratio taking into account the payment of the Accounts Payable?

(Round to the nearest 3rd decimal place in your answer format)

Compute Bond Proceeds, Amortizing Discount by Interest Method, and Interest Expense

Boyd Co. produces and sells aviation equipment. On the first day of its fiscal year, Boyd Co. issued $40,000,000 of five-year, 10% bonds at a market (effective) interest rate of 12%, with interest payable semiannually. Compute the following:

a. The amount of cash proceeds from the sale of the bonds. Use the tables of present values in Exhibit 5 and Exhibit 7. Round to the nearest dollar.
$

b. The amount of discount to be amortized for the first semiannual interest payment period, using the interest method. Round to the nearest dollar.
$

c. The amount of discount to be amortized for the second semiannual interest payment period, using the interest method. Round to the nearest dollar.
$

d. The amount of the bond interest expense for the first year. Round to the nearest dollar.
$

Magnolia Manufacturing makes wing components for large aircraft. Kevin Choi is the production manager, responsible for manufacturing, and Michelle Michaels is the marketing manager. Both managers are paid a flat salary and are eligible for a bonus. The bonus is equal to 1 percent of their base salary for every 10 percent profit that exceeds a target. The maximum bonus is 6 percent of salary. Kevin’s base salary is $190,000 and Michelle’s is $250,000.

The target profit for this year is $5 million. Kevin has read about a new manufacturing technique that would increase annual profit by 20 percent. He is unsure whether to employ the new technique this year, wait, or not employ it at all. Using the new technique will not affect the target.

Required:

a. Suppose that profit without using the technique this year will be $5 million. By how much will Kevin’s and Michelle’s bonus change if Kevin decides to employ the new technique? (Enter your answers in dollars, not in millions.)

Kevin's bonus change = ?

Michelle's bonus change = ?

b. Suppose that profit without using the technique this year will be $7.5 million. By how much will Kevin’s and Michelle’s bonus change if Kevin decides to employ the new technique? (Round your intermediate percentage answers to nearest whole percent. Enter your answers in dollars, not in millions.)

Kevin's bonus change = ?

Michelle's bonus change = ?

Balloons By Sunset (BBS) is considering the purchase of two new hot air balloons so that it can expand its desert sunset tours. Various information about the proposed investment follows: Initial investment (for two hot air balloons) $ 370,000 Useful life 8 years Salvage value $ 58,000 Annual net income generated 27,750 BBS’s cost of capital 11 % Assume straight line depreciation method is used. Required: Help BBS evaluate this project by calculating each of the following: 1. Accounting rate of return. (Round your answer to 1 decimal place.) 2. Payback period. (Round your answer to 2 decimal places.) 3. Net present value (NPV). (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollar.) 4. Recalculate the NPV assuming BBS's cost of capital is 14 percent. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Do not round intermediate calculations. Negative amount should be indicated by a minus sign. Round the final answer to nearest whole dollar.)

On December 31, 2016, Monty Corp. provided you with the following pre-adjustment information regarding its portfolio of investments held for short-term profit-taking.

December 31, 2016

Investments Carrying Amount Fair Value

Moonstar Corp. shares $20,000 $18,600

Bilby Corp. shares $10,000 $8,800

Radius Ltd. Shares $19,600 $20,200

Total portfolio: $49,600 $47,600

During 2017, the Bilby Corp. shares were sold for $9,500 and Springs Ltd. shares were purchased for $9,000 plus 1% commission. The fair values on December 31,2017 were as follows: Moonstar Corp. shares $19,700, Radius Ltd. shares $21,000 and Springs Ltd. shares $8,600. Dividends and other investment income and losses are all reported in one investment income account.

Required:

a) Prepare the adjusting journal entry needed at December 31, 2016

b) Prepare the journal entries to record the sale of the Bilby Corp. shares and purchase of Springs Ltd. shares during 2017.

c) Prepare the adjusting journal entries needed on December 31, 2017

Yoshi Company completed the following transactions and events involving its delivery trucks.

2017

2018

2019

Required:

1-a. Calculate depreciation for year 2018.
1-b. Calculate book value and gain (loss) for sale of Truck on December, 2019.
1-c. Prepare journal entries to record these transactions and events.

Calculate depreciation for year 2018.

Calculate book value and gain (loss) for sale of Truck on December, 2019.

Prepare journal entries to record these transactions and events.

Journal entry worksheet

• Record the total cost of the new delivery truck.

Note: Enter debits before credits.

Marketing at Pepe’s Pizzeria focuses on the development, growth, and maintenance of cost-effective, high-value relationships with each of its customers. This type of marketing is known as _____.

a. direct marketing b. relationship marketing c. transaction-based marketing d. value-based marketing

The relationship between Pepe’s Pizzeria and its customers functions at which level of the relationship marketing continuum?

a. Fourth Level b. Third Level c. Second Level d. First Level

Pepe’s Pizzeria indulges in social interaction and interactive marketing with its customers on Twitter and Facebook. Thus, Pepe’s Pizzeria builds buyer–seller relationships through _____.

a. grassroots marketing b. database marketing c. frequency marketing d. interactive television

If Pepe’s Pizzeria built its brand equity by letting satisfied customers get the word out about its pizzas to other consumers, the type of marketing initiative used is known as _____.

a. affinity marketing b. ambush marketing c. viral marketing d. direct marketing

How can Pepe’s Pizzeria determine the costs it incurs to serve each customer and thus develop ways to increase its profitability?

a. By calculating the customer churn b. Through the payback method c. Through tracking rebates, coupons, and credit card purchases d. By calculating the lifetime value of its customers

or the current year, Custom Craft Services Inc. (CCS), a C corporation, reports taxable income of $302,000 before paying salary to Jaron the sole shareholder. Jaron’s marginal tax rate on ordinary income is 35 percent and 15 percent on dividend income. Assume CCS’s tax rate is 35 percent. a. How much total income tax will Custom Craft Services and Jaron pay (combining both corporate and shareholder level taxes) on the $302,000 taxable income for the year if CCS doesn’t pay any salary to Jaron and instead distributes all of its after-tax income to Jaron as a dividend (assume Jaron is not subject to the net investment income tax or the additional Medicare tax)?

b. How much total income tax will Custom Craft Services and Jaron pay (combining both corporate and shareholder level taxes) on the $302,000 of income if CCS pays Jaron a salary of $212,000 and distributes its remaining after-tax earnings to Jaron as a dividend (assume Jaron is not subject to the net investment income tax or the additional Medicare tax)?

In the modern business ethics reality, Canadian corporations - and those in most English - speaking countries - are increasingly accountable for their actions (and inactions) to a broad range of stakeholders. Moreover, because the support of stakeholders is now generally regarded as essential for a corporation to reach its strategic objectives, measures to gain and keep this support are now expected to be integrated into governance procedures, policies, strategies and actions in the workplace. Discuss.

On January 1, 2018, the general ledger of a company includes the following account balances: Accounts Debit Credit Cash $ 87,000 Accounts Receivable 56,000 Allowance for Uncollectible Accounts $ 5,000 Inventory 47,000 Building 87,000 Accumulated Depreciation 27,000 Land 217,000 Accounts Payable 37,000 Notes Payable (6%, due in 3 years) 54,000 Common Stock 117,000 Retained Earnings 254,000 Totals $ 494,000 $ 494,000 The company accounts for all inventory transactions using the perpetual FIFO method. Purchases and sales of inventory are recorded using the gross method for cash discounts. The $47,000 beginning balance of inventory consists of 470 units, each costing $100. During January 2018, the company had the following transactions: During January 2018, the following transactions occur: January 2 Lent $37,000 to an employee by accepting 6% note due in six months. January 5 Purchased 5,200 units of inventory on account for $520,000 ($100 each) with terms 1/10, n/30. January 8 Returned 110 defective units of inventory purchased on January 5. January 15 Sold 5,000 units of inventory on account for $600,000 ($120 each) with terms 2/10, n/30. January 17 Customers returned 100 units sold on January 15. These units are placed in inventory to be sold in the future. January 20 Received cash from customers on accounts receivable. This amount includes $53,000 from 2017 plus amount receivable on sale of 4,500 units sold on January 15. January 21 Wrote off remaining accounts receivable from 2017. January 24 Paid on accounts payable. The amount includes the amount owed at the beginning of the period plus the amount owed from purchase of 4,800 units on January 5. January 28 Paid cash for salaries during January, $45,000. January 29 Paid cash for utilities during January, $27,000. January 30 Paid dividends, $6,000. The following information is available on January 31, 2018. Of the remaining accounts receivable, the company estimates that 10% will not be collected. Accrued interest income on notes receivable for January. Accrued interest expense on notes payable for January. Accrued income taxes at the end of January for $6,700. Depreciation on the building, $3,700.

Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 - 13) assuming a FIFO perpetual inventory system. The transaction on January 30 requires two entries: one to record sales revenue and one to record cost of goods sold. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances. Record adjusting entries on January 31. in the 'General Journal' tab (these are shown as items 14-18). Record the closing entries in the 'General Journal' tab (these are shown as items 19 and 20). (The company prepares closing entries by closing the appropriate accounts directly to Retained Earnings. If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

ACME manufacturing is a low-cost producer of a single, commodity product: RGL-01. Standard overhead cost information for one unit of this product is presented below:

Required

3. What is the total overhead variance for the year when the overhead application rate per machine hour is determined under each of the following options: (a) budgeted output, (b) normal capacity, and (c) practical capacity? Indicate whether each variance is favorable (F) or unfavorable (U). (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount.)

5. What is the Overhead Efficiency Variance (= Variable Overhead Efficiency Variance) for the year when the overhead application rate per machine hour is determined under each of the following options: (a) budgeted output, (b) normal capacity, and (c) practical capacity? Indicate whether each variance is favorable (F) or unfavorable (U).

7. What is the total Overhead Spending Variance for the year under each of the following assumptions regarding the denominator activity level used to set the overhead application rate for the year:

a) budgeted output, (b) normal capacity, and (c) practical capacity? State whether each variance is favorable (F) or unfavorable (U).

8. Break down the Total Overhead Spending Variance (as determined in requirement 7) into: (a) a Fixed Overhead Spending Variance, and

(b) a Variable Overhead Spending Variance. State whether each variance is favorable (F) or unfavorable (U).

Waterways for Chapter 9 (WCP9sum) Summer Waterways Corporation is preparing its budget for the coming year. The first step is to plan for the first quarter of that coming year. Waterways gathered the following information from the managers. Sales: Actual unit sates for November 113,500

Actual unit sales for December 103,100

Expected unit sales for January 114,000

Expected unit sales for February 113,500

Expected unit sales for March 116,000 Expected unit sales for April 126,000

Expected unit sales for May 138,500

Unit selling price $12 Waterways wants to keep 10% of the next month’s unit sales in ending inventory. All sales are on account. 85% of the Accounts Receivable are collected in the month of sale and 15% of the Accounts Receivable are collected in the month after sale. Accounts receivable on December 31 totaled 183,780. Direct Materials: The product uses metal, plastic, and rubber. In total, each unit requires 2 pounds of material at an average cost of 0.75 per pound. Waterways likes to keep 5% of the materials needed for the next month in its ending inventory. Payment for materials is made within 15 days. 50% is paid in the month of purchase and 50% is paid in the month after purchase. Accounts Payable on December totaled $120,595. Raw materials on December 31 totaled 11,295 pounds. Direct Labor: Labor requires 12 minutes per unit for completion and is paid at a rate of $18 per hour. Manufacturing Overhead:

Indirect materials 30 cents per labor hour

Indirect labor 50 cents per labor hour

Utilities 45 cents per labor hour

Maintenance 25 cents per labor hour

Salaries $52,000 per month

Depreciation $16,800 per month

Property taxes $2,675 per month Insurance $2,200 per month

Janitorial $1,800 per month

Selling and Administrative Expenses: Variable selling and administrative cost per unit is $2.40.

Advertising $15,000 per month

Insurance $1,400 per month

Salaries $72,000 per month

Depreciation $2,500 per month

Other fixed costs $3,000 per month

Other Information: The cash balance on December 31 totaled $220,500, but management has decided that it wants to maintain a cash balance of at least $750,000 beginning January 31. Dividends are paid each month at the rate of $2.50 per share for 5,000 shares outstanding. The company has an open line of credit with the First National Bank. The terms of the agreement requires borrowing to be in $1,000 increments at 8% interest. Waterways borrows on the first day of the month and repays on the last day of the month. Reserve repayment, if required, until Waterways can pay the entire amount. A $250,000 equipment purchase is planned for February.

Instructions (Do all parts): Note: All budgets and schedules should be prepared by month for the first quarter (January, February, and March). Round all figures to the nearest dollar. For labor hours round to whole hours.

a. Prepare a sales budget.

b. Prepare a production budget.

c. Prepare a direct materials budget.

d. Prepare a direct labor budget.

e. Prepare a manufacturing overhead budget.

f. Prepare a selling and administrative budget.

g. Prepare a schedule for expected cash collections from customers.

h. Prepare a schedule for expected payments for materials purchases.

i. Prepare a cash budget.

I ONLY NEED PARTS e,f,g,h,i please

You are the lead auditor performing a walkthrough of the bank reconciliation performed by the company controller. What is the design deficiency of the control below ? What additional steps should the Controller perform ?

The Controller says, "I first review the sorted list of returned checks and find which numbers are missing. Second I determine the amount uncleared checks by referring to the cash disbursements journal. If the bank accounts reconcile at that point, the review is done. If it does not reconcile I search for in transit deposits, checks from the beginning outstanding checks list that still have not cleared, other reconciling items and bank errors until it reconciles."