What are the journal entries for the following transaction?
A company entered into a two-year loan of $20,000,000, with a 20% interest rate payable semi-annually April 1 and October 1 with no principal due until maturity. The debt is convertible into shares of common stock at $1.50 per share. The company incurred $1,5000,000 in financing costs, paid to the issuer.
In: Accounting
2. Handbag Ltd issued 2000 ordinary shares of P5 at an issue price of P8. Payment for the shares was made as follows: On application P2, on allotment P4 (including share premium), on first call P1 and on second call P1. Applications were received for 2000.All the instalments were received on due dates. Prepare relevant accounts to record the above issue of shares.
In: Accounting
| ToyWorks | ||||
| Selling and Administrative Budget | ||||
| First Quarter For the Year Ended December 31, 2019 | ||||
| Month | ||||
| January | February | March | Quarter | |
| Cash balance, beginning | 64,165 | $ - | $ - | |
| Receipts | ||||
| Cash sales | $137,500.00 | $275,000.00 | $137,500.00 | $550,000.00 |
| Credit collections | $400,188.00 | $177,750.00 | $198,750.00 | $776,688.00 |
| Total cash available | $601,853.00 | $452,750.00 | $336,250.00 | $1,326,688.00 |
| Less disbursements: | ||||
| Direct materials | $136,934.65 | $99,928.45 | $79,538.00 | $316,400.00 |
| Direct labour | $84,375.00 | $118,125.00 | $74,250.00 | $276,750.00 |
| Variable manufacturing overheads | $40,625.00 | $56,875.00 | $35,750.00 | $133,250.00 |
| Fixed manufacturing overheads | $52,000.00 | $52,000.00 | $34,200.00 | $198,600.00 |
| Variable selling and administrative expense | $16,250.00 | $32,500.00 | $16,250.00 | $65,000.00 |
| Fixed selling and administrative expense | $44,580.00 | $44,580.00 | $44,580.00 | $133,740.00 |
| Income taxes | $1,500.00 | $1,500.00 | $1,500.00 | $4,500.00 |
| Outstanding 2018 income taxes | $0.00 | $0.00 | $21,500.00 | $21,500.00 |
| Equipment purchases | $121,680.00 | $182,520.00 | $0.00 | $304,200.00 |
| Dividends | $0.00 | $0.00 | $50,000.00 | $50,000.00 |
| Total disbursements | $497,944.65 | $588,028.45 | $357,568.00 | $1,503,940.00 |
| Excess (deficiency) of cash available over disbursements |
$ 103,908.35 | $ (135,278.45) | $ (21,318.00) | $ (177,252.00) |
| Financing | ||||
| Borrowings (at beginning) | $ - | $ - | $ - | |
| Repayment (at end) | $ - | $ - | $ - | |
| Total financing | $ - | $ - | $ - | |
An arrangement has been made with the local bank that if ToyWorks maintains a minimum balance of $20,000 in their bank account, they will be given a line of credit at a preferred rate of 6% per annum. All borrowing is considered to happen on the first day of the month, repayments are on the last day of the month. All borrowings and repayments from the bank should be in multiples of $1,000 and interest must be paid at the end of each month. Interest is calculated on the balance at the beginning of the month, which includes any amounts borrowed that month.
Complete the financing option for the company
In: Accounting
my assignment is to determine the type of investment (debt or equity) for a publicly traded company. I also need to speculate on what the investments are and how they are classified. I don't know how to find these answers looking at the company (The Clorox Company) balance sheet. How do I answer these question just looking at the balance sheet?
Thank you
In: Accounting
Discuss the impact of quality control on product quality, on production cost, and product pricing
In: Accounting
You are the Manager of Financial Reporting for your company. Your company is facing a number of reporting challenges as a result of an acquisition, COVID-19 and other activities. Although the CFO makes the final decision on accounting standard applications, the CFO relies heavily on your expertise (acquired in the Aurora University MSA program) and your years of research and experience.
In a meeting (brainstorming session), a list of potential reporting issues is developed and are listed below. You have been asked to select the three you feel may be most important and prepare a memo to be reviewed and to guide proper accounting treatment for each.
Your memo should include:
Organization-Appears neat and organized; logical; no spelling or grammar errors; guides the reader to the point(s).
Facts/Issues-States area being reviewed and identifies importance (“issue”) to a company.
Applicable Literature-Identifies all applicable literature. It is properly linked to the issue noted above. Citations are to adequate depth that it represents support, not the start of a new search. Please remember, some areas have guidance in more than one area of ASC. Some topics have conflicting direction. These should all be identified.
Remember as you prepare your memo to be complete but concise. Like most executives, the CFO has the attention span of an ant. Your goal is to get the key points summarize and supported, having a significant impact on the decision-making process.
Here is the list of topics developed in the brainstorming session:
You can answer any three BUT your answers must be in numerical order (eg. 4, 7, 10). DO NOT submit your answers out of order (eg. 7, 4 , 9).
In: Accounting
Gallatin Carpet Cleaning is a small, family-owned business operating out of Bozeman, Montana. For its services, the company has always charged a flat fee per hundred square feet of carpet cleaned. The current fee is $23.85 per hundred square feet. However, there is some question about whether the company is actually making any money on jobs for some customers—particularly those located on remote ranches that require considerable travel time. The owner’s daughter, home for the summer from college, has suggested investigating this question using activity-based costing. After some discussion, she designed a simple system consisting of four activity cost pools. The activity cost pools and their activity measures appear below:
| Activity Cost Pool | Activity Measure | Activity for the Year | |
| Cleaning carpets | Square feet cleaned (00s) | 9,500 | hundred square feet |
| Travel to jobs | Miles driven | 235,500 | miles |
| Job support | Number of jobs | 1,600 | jobs |
| Other (organization-sustaining costs and idle capacity costs) | None | Not applicable | |
The total cost of operating the company for the year is $347,000 which includes the following costs:
| Wages | $ | 140,000 |
| Cleaning supplies | 34,000 | |
| Cleaning equipment depreciation | 7,000 | |
| Vehicle expenses | 28,000 | |
| Office expenses | 61,000 | |
| President’s compensation | 77,000 | |
| Total cost | $ | 347,000 |
Resource consumption is distributed across the activities as follows:
| Distribution of Resource Consumption Across Activities | ||||||||||
| Cleaning Carpets | Travel to Jobs | Job Support | Other | Total | ||||||
| Wages | 72 | % | 11 | % | 0 | % | 17 | % | 100 | % |
| Cleaning supplies | 100 | % | 0 | % | 0 | % | 0 | % | 100 | % |
| Cleaning equipment depreciation | 66 | % | 0 | % | 0 | % | 34 | % | 100 | % |
| Vehicle expenses | 0 | % | 81 | % | 0 | % | 19 | % | 100 | % |
| Office expenses | 0 | % | 0 | % | 65 | % | 35 | % | 100 | % |
| President’s compensation | 0 | % | 0 | % | 33 | % | 67 | % | 100 | % |
Job support consists of receiving calls from potential customers at the home office, scheduling jobs, billing, resolving issues, and so on.
Required:
1. Prepare the first-stage allocation of costs to the activity cost pools.
2. Compute the activity rates for the activity cost pools.
3. The company recently completed a 400 square foot carpet-cleaning job at the Flying N ranch—a 53-mile round-trip journey from the company’s offices in Bozeman. Compute the cost of this job using the activity-based costing system.
4. The revenue from the Flying N ranch was $95.40 (400 square feet @ $23.85 per hundred square feet). Calculate the customer margin earned on this job.
Complete this question by entering your answers in the tabs below.
|
Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places.)
|
The company recently completed a 400 square foot carpet-cleaning job at the Flying N ranch—a 53-mile round-trip journey from the company’s offices in Bozeman. Compute the cost of this job using the activity-based costing system. (Round your intermediate calculations and final answer to 2 decimal places.)
|
The revenue from the Flying N ranch was $95.40 (4 hundred square feet @ $23.85 per hundred square feet). Calculate the customer margin earned on this job. (Round your intermediate calculations and final answers to 2 decimal places.)
|
In: Accounting
Is it necessary to have a set of International Auditing Standards? Would it be better if the International Accounting Standards were allowed to be set by or be based upon U.S. auditing standards? Or perhaps International Auditing Standards should be set by the United Nations? In your opinion, is it perhaps easier for the world to reach an agreement on International Auditing Standards than it is for the world to reach an agreement on International Accounting Standards? Why or why not for each of the above individual questions? Be specific.
In: Accounting
In: Accounting
Frigid Motors Inc. assembles and sells snowmobile engines. The company began operations on July 1, 2016, and operated at 100% of capacity during the first month. The following data summarize the results for July:
|
1 |
Sales (32,000 units) |
$8,000,000.00 |
|
|
2 |
Production costs (41,000 units): |
||
|
3 |
Direct materials |
$3,280,000.00 |
|
|
4 |
Direct labor |
2,255,000.00 |
|
|
5 |
Variable factory overhead |
1,025,000.00 |
|
|
6 |
Fixed factory overhead |
615,000.00 |
7,175,000.00 |
|
7 |
Selling and administrative expenses: |
||
|
8 |
Variable selling and administrative expenses |
$1,180,000.00 |
|
|
9 |
Fixed selling and administrative expenses |
210,000.00 |
1,390,000.00 |
| Required: | |||
| A. | Prepare an income statement according to the absorption costing concept.* | ||
| B. | Prepare an income statement according to the variable costing concept. A colon (:) will automatically appear if it is required.* | ||
| C. | What is the reason for the
difference in the amount of income from operations reported in (A)
and (B)?
|
In: Accounting
In: Accounting
Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Hemming Co. reported the following current-year purchases and sales for its only product. Date Activities Units Acquired at Cost Units Sold at Retail Jan. 1 Beginning inventory 300 units @ $14.00 = $ 4,200 Jan. 10 Sales 250 units @ $44.00 Mar. 14 Purchase 520 units @ $19.00 = 9,880 Mar. 15 Sales 460 units @ $44.00 July 30 Purchase 500 units @ $24.00 = 12,000 Oct. 5 Sales 480 units @ $44.00 Oct. 26 Purchase 200 units @ $29.00 = 5,800 Totals 1,520 units $ 31,880 1,190 units Exercise 6-7 Perpetual: Inventory costing methods-FIFO and LIFO LO P1 Required: Hemming uses a perpetual inventory system. 1. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. 2. Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. 3. Compute the gross margin for FIFO method and LIFO method.
In: Accounting
Problem 16-2A Weighted average: Cost per equivalent unit; costs assigned to products LO C2, C3
[The following information applies to the questions
displayed below.]
Victory Company uses weighted-average process costing to account
for its production costs. Conversion cost is added evenly
throughout the process. Direct materials are added at the beginning
of the process. During November, the company transferred 740,000
units of product to finished goods. At the end of November, the
work in process inventory consists of 191,000 units that are 70%
complete with respect to conversion. Beginning inventory had
$544,635 of direct materials and $218,425 of conversion cost. The
direct material cost added in November is $3,644,865, and the
conversion cost added is $4,150,075. Beginning work in process
consisted of 70,000 units that were 100% complete with respect to
direct materials and 80% complete with respect to conversion. Of
the units completed, 70,000 were from beginning work in process and
670,000 units were started and completed during the period.
Problem 16-2A Part 3
3. Compute the direct material cost and the conversion cost assigned to units completed and transferred out and ending work in process inventory. (Round "Cost per EUP" to 2 decimal places.)
EUP Cost per EUP Total cost
Cost of units transferred out:
Direct materials
Conversion
Total costs transferred out
Cost of ending work in process
Direct materials
Conversion
Total cost of ending work in process
Total costs accounted for
In: Accounting
On January 1, 2017, Corgan Company acquired 70 percent of the outstanding voting stock of Smashing, Inc., for a total of $805,000 in cash and other consideration. At the acquisition date, Smashing had common stock of $740,000, retained earnings of $290,000, and a noncontrolling interest fair value of $345,000. Corgan attributed the excess of fair value over Smashing's book value to various covenants with a 20-year remaining life. Corgan uses the equity method to account for its investment in Smashing.
During the next two years, Smashing reported the following:
| 2017 | 2018 | |
| Net Income | $190,000 | $170,000 |
| Dividends Declared | $39,000 | $49,000 |
| Inventory Purchases from Corgan | $140,000 | $160,000 |
Corgan sells inventory to Smashing using a 60 percent markup on cost. At the end of 2017 and 2018, 30 percent of the current year purchases remain in Smashing's inventory.
a.) Compute the equity method balance in Corgan's Investment in Smashing, Inc., account as of December 31, 2018.
b.) Prepare the worksheet adjustments for the December 31, 2018, consolidation of Corgan and Smashing.
In: Accounting
Refer to the December 2019 Annual Report of Chevron below. Using the information below
Note: "Net before-tax gains on asset sales and investments" include gains/losses from investment sales including marketable securities.
At December 31 2019 and 2018
Total Current Assets 28,329 34,021
Long-term receivables, net 1,511 1,942
Investments and advances 38,688 35,546
Properties, plant and equipment, at cost 326,722 340,244
Less: Accumulated depreciation 176,228 171,037
Properties, plant and equipment, net 150,494 169,207
Deferred charges and other assets 10,532 6,766
Goodwill 4,463 4,518
Assets held for sale 3,411 1,863
Total Assets $ 237,428 $ 253,863
In: Accounting