The following transactions were recorded by an inexperienced bookkeeper during the months of June and July for Ivanhoe Company. Ivanhoe Company uses a perpetual inventory system.

Review each transaction below and indicate whether you agree or disagree with how the bookkeeper accounted for the transaction.

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List of Accounts

If you disagreed with any of the accounting entries above, prepare the correct entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)

Statement of Cash Flows—Indirect Method

The comparative balance sheet of Merrick Equipment Co. for December 31, 20Y9 and 20Y8, is as follows:

Additional data obtained from an examination of the accounts in the ledger for 20Y9 are as follows:

1. Equipment and land were acquired for cash.
2. There were no disposals of equipment during the year.
3. The investments were sold for $91,480 cash.
4. The common stock was issued for cash.
5. There was a $65,140 credit to Retained Earnings for net income.
6. There was a $40,830 debit to Retained Earnings for cash dividends declared.

Required:

Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

Roane Company has entered into two lease agreements. In each case

the cash equivalent purchase price of the asset acquired is known, the interest rate is 6%, and you wish to find the number of required lease payments.

Lease A covers office equipment which could be purchased for $70,000. Roane Company has, however, chosen to lease the equipment for $11,000 per year, payable at start of each of the next ___ years.

Lease A _____ years

Lease B applies to a machine which can be purchased for $66,000. Roane Company has chosen to lease the machine for $10,000 per year. Payments are due at the end of each year.

   Lease B _____ years

Vertical Analysis of Income Statement

Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:

a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers.

Tiner Leasing Company purchased specialized equipment from Fred

Company on December 31, 2019 for $800,000. On the same date, it leased this equipment to Tears Company for 6 years, the useful life of the equipment. The lease payments begin January 1, 2020 and are made every 6 months. Tiner Leasing wants to earn 9% annually on its investment.

   (a) Calculate the amount of each rent. $ __________

   (b) How much interest revenue will Tiner earn in 2020? $ __________

The cash account for Pala Medical Co. at June 30, 20Y1, indicated a balance of $146,035. The bank statement indicated a balance of $181,965 on June 30, 20Y1. Comparing the bank statement and the accompanying canceled checks and memos with the records revealed the following reconciling items:

1. Prepare a bank reconciliation. Refer to the Amount Descriptions list provided for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Exercise 16-44 Comprehensive Cost Variance Analysis (LO 16-5, 6)

NSF Lube is a fast-growing chain of oil-change stores. The following data are available for last year’s services:

NSF Lube performed 467,700 oil changes last year. It had budgeted 435,000 oil changes, averaging 8 minutes each.

Standard variable labor and support costs per oil change were as follows:

Direct oil specialist services: 8 minutes at $30 per hour $ 4.00

Variable support staff and overhead: 10.5 minutes at $20 per hour 3.5

Fixed overhead costs: Annual budget $1,039,000

Fixed overhead is applied at the rate of $3.90 per oil change.

Actual oil change costs:

Direct oil specialist services: 467,700 changes averaging 11 minutes at $34 per hour $ 2,915,330

Variable support staff and overhead: 0.22 labor-hours at $15 per hour × 467,700 changes 1,543,410

Fixed overhead 1,425,000

a. Prepare a cost variance analysis for each variable cost for last year.

b. Prepare a fixed overhead cost variance analysis

I know the answer for b is:

Price Variance: $386,000 U

Production Volume Variance: $785,030 F

Fixed Overhead Cost Variance: $399,030 F

......But I can't figure out A: how to get the Price Variance, Efficiency Variance or the total variance for both the oil specialist and the variable overhead.

Any help would be appreciated.

Toxaway Company is a merchandiser that segments its business into two divisions—Commercial and Residential. The company’s accounting intern was asked to prepare segmented income statements that the company’s divisional managers could use to calculate their break-even points and make decisions. She took the prior month’s companywide income statement and prepared the absorption format segmented income statement shown below:

In preparing these statements, the intern determined that Toxaway’s only variable selling and administrative expense is a 10% sales commission on all sales. The company’s total fixed expenses include $57,000 of common fixed expenses that would continue to be incurred even if the Commercial or Residential segments are discontinued, $90,000 of fixed expenses that would be avoided if the Commericial segment is dropped, and $68,000 of fixed expenses that would be avoided if the Residential segment is dropped.

Required:

1. Redo the intern’s segmented income statement using the contribution format.

2. Compute the companywide break-even point in dollar sales.

3. Compute the break-even point in dollar sales for the Commercial Division and for the Residential Division.

4. Assume the company decided to pay its sales representatives in the Commercial and Residential Divisions a total monthly salary of $17,500 and $35,000, respectively, and to lower its companywide sales commission percentage from 10% to 5%. Calculate the new break-even point in dollar sales for the Commercial Division and the Residential Division.

All other things the same, in periods of increasing sales, net operating income will tend to increase more rapidly in a company with high fixed costs and low variable costs than in a company with high variable costs and low fixed costs.

Lou Barlow, a divisional manager for Sage Company, has an opportunity to manufacture and sell one of two new products for a five-year period. He has computed the cost and revenue estimates for each product as follows:

The company’s discount rate is 19%.

Ignore income taxes. Note that Excel or a financial calculator must be used to calculate items 2 - 4.

Required:

1. Calculate the payback period for each product.

2. Calculate the net present value for each product.

3. Calculate the internal rate of return for each product.

4. Calculate the project profitability index for each product.

6a. For each measure, identify whether Product A or Product B is preferred.

On December 31, 2020, an analysis of the accounts for a company reveals the following:

$100,000 loss on disposal of discontinued operations, before tax

$6,000 gain on sale of investments, before tax

$10,000 depreciation expense understatement in 2018 due to error, before tax

$20,000 cumulative understatement of net income of prior years from changing inventory valuation method in 2020, before tax

$168,000 income from operations, before tax

$4,000 dividends declared

The applicable income tax rate is 40% for all tax-related items. Retained earnings on December 31, 2019 were reported as $600,000.

What is ending retained earnings on December 31, 2020?

spoke about auditing but specifically risk-based audit. Risk-based audit focuses on auditing controls and systems rather than numbers.

What are three FEDERAL documents in which tax-exempt organizations are REQUIRED to disclose to the public?

List three characteristics of Gen Z which were described in the video, "Gen Z in the Workforce" and also explain why you agree or disagree with the characteristics described in the video.

"Regular" volunteers are volunteers which essentially fill the role of a staff position, but are not paid, employees. An example might be a volunteer driver for Meals on Wheels.