(CO A) Review some of the Panel on Audit Effectiveness recommendations.
In: Accounting
The trial balance before adjustment of Skysong, Inc. shows the following balances:
| Dr. | Cr. | |||
|---|---|---|---|---|
|
Accounts receivable |
$105,900 | |||
|
Allowance for doubtful accounts |
2,000 | |||
|
Sales revenue (all on credit) |
$687,000 | |||
|
Sales returns and allowances |
28,400 |
Give the entry for bad debt expense for the current year assuming the allowance should be 3% of gross accounts receivable. (Credit account titles are automatically indented when 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.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
Give the entry for bad debt expense for the current year assuming historical records show that, based on accounts receivable aging, the following percentages will not be collected: (Credit account titles are automatically indented when 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.)
| Balance | Percentage
Estimated to Be Uncollectible |
|||
|---|---|---|---|---|
|
0–30 days outstanding |
$37,200 | 1% | ||
|
31–60 days outstanding |
47,000 | 5% | ||
|
61–90 days outstanding |
13,200 | 12% | ||
|
Over 90 days outstanding |
8,500 | 18% |
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title |
Give the entry for bad debt expense for the current year assuming allowance for doubtful accounts is $2,000 but it is a credit balance and the allowance should be 3% of gross accounts receivable. (Credit account titles are automatically indented when 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.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title |
enter a debit amount |
enter a credit amount |
|
enter an account title |
enter a debit amount |
enter a credit amount |
eTextbook and Media
List of Accounts
Give the entry for bad debt expense for the current year assuming allowance for doubtful accounts is $2,000 but it is a credit balance and historical records show that the following percentages will not be collected: (Credit account titles are automatically indented when 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.)
| Balance | Percentage
Estimated to Be Uncollectible |
|||
|---|---|---|---|---|
|
0–30 days outstanding |
$37,200 | 1% | ||
|
31–60 days outstanding |
47,000 | 5% | ||
|
61–90 days outstanding |
13,200 | 12% | ||
|
Over 90 days outstanding |
8,500 | 18% |
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
List of Accounts
In: Accounting
Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company’s present selling price is $90 per unit, and variable expenses are $60 per unit. Fixed expenses are $831,600 per year. The present annual sales volume (at the $90 selling price) is 25,600 units.
Required:
1. What is the present yearly net operating income or loss?
2. What is the present break-even point in unit sales and in dollar sales?
3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit?
4. What would be the break-even point in unit sales and in dollar sales using the selling price you determined in (3) above (e.g., the selling price at the level of maximum profits)?
In: Accounting
The following financial statements apply to Karl Company:
| 2019 | 2018 | ||||||
| Revenues | |||||||
| Net sales | $ | 420,000 | $ | 350,000 | |||
| Other revenues | 16,000 | 10,000 | |||||
| Total revenues | 436,000 | 360,000 | |||||
| Expenses | |||||||
| Cost of goods sold | 252,000 | 206,000 | |||||
| Selling expenses | 42,000 | 38,000 | |||||
| General and administrative expenses | 22,000 | 20,000 | |||||
| Interest expense | 6,000 | 6,000 | |||||
| Income tax expense | 42,000 | 36,000 | |||||
| Total expenses | 364,000 | 306,000 | |||||
| Net income | $ | 72,000 | $ | 54,000 | |||
| Assets | |||||||
| Current assets | |||||||
| Cash | $ | 8,000 | $ | 16,000 | |||
| Marketable securities | 2,000 | 2,000 | |||||
| Accounts receivable | 70,000 | 64,000 | |||||
| Inventories | 200,000 | 192,000 | |||||
| Prepaid expenses | 6,000 | 4,000 | |||||
| Total current assets | 286,000 | 278,000 | |||||
| Plant and equipment (net) | 210,000 | 210,000 | |||||
| Intangibles | 40,000 | 0 | |||||
| Total assets | $ | 536,000 | $ | 488,000 | |||
| Liabilities and Stockholders’ Equity | |||||||
| Liabilities | |||||||
| Current liabilities | |||||||
| Accounts payable | $ | 80,000 | $ | 108,000 | |||
| Other | 34,000 | 30,000 | |||||
| Total current liabilities | 114,000 | 138,000 | |||||
| Bonds payable | 132,000 | 134,000 | |||||
| Total liabilities | 246,000 | 272,000 | |||||
| Stockholders’ equity | |||||||
| Common stock (100,000 shares) | 230,000 | 230,000 | |||||
| Retained earnings | 60,000 | (14,000 | ) | ||||
| Total stockholders’ equity | 290,000 | 216,000 | |||||
| Total liabilities and stockholders’ equity | $ | 536,000 | $ | 488,000 | |||
Required
Calculate the following ratios for 2018 and 2019. Since 2017 numbers are not presented, do not use averages when calculating the ratios for 2018. Instead, use the number presented on the 2018 balance sheet.
|
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Please help me fill in the blanks...
In: Accounting
Provide at least one example of when the gross profit method would be useful. Explain the rationale for selecting the example provided.
In: Accounting
In: Accounting
Part 2:
|
NEWCREST |
CASH FLOW FROM OPERATING ACTIVITIES |
CASH FLOW FROM INVESTING ACTIVITIES |
CASH FLOW FROM FINANCING |
|
2018 US $M |
$1434 |
$-833 |
$-140 |
|
NEWCREST |
Ratio |
|
Working Capital Ratio -Current assets/ Current liabilities= |
1672/651=2.57 |
|
Cash Flow Adequacy Ratio (Liquidity): Acid Ration= Current assets (excluding inventory and prepayments)/ current liabilities= |
1672(554-77)/651=1.60 |
|
Debt to Total Assets Ratio Short-Term Debt + Long-Term Debt/ Total Assets= |
4018/11480=0.35 |
|
Debt Coverage Ratio (Solvency)= Net Operating Income/ The Debt Service= |
1590/179=0.89 |
|
Cash Flow to Sales Ratio (Profitability) Operating cash flow/net sales= |
1434/3562=0.40 |
|
FORESCUE |
CASH FLOW FROM OPERATING ACTIVITIES |
CASH FLOW FROM INVESTING ACTIVITIES |
CASH FLOW FROM FINANCING |
|
2018 US $M |
$1,601 |
$-936 |
$-1,626 |
|
Forescue |
Ratio |
|
Working Capital Ratio -Current assets/ Current liabilities= |
1650/1239=1.33 |
|
Cash Flow Adequacy Ratio (Liquidity): Acid Ration= Current assets (excluding inventory and prepayments)/ current liabilities= |
1650(496+120)/1239=0.83 |
|
Debt to Total Assets Ratio (Short-Term Debt+Long-Term Debt/ Total Assets= |
8117/1650=4.92 |
|
Debt Coverage Ratio (Solvency)= Net Operating Income/ The Debt Service= |
1601/8117=0.20 |
|
Cash Flow to Sales Ratio (Profitability) Operating cash flow/net sales= |
1601/6718=0.24 |
Part 3:
Based on the analysis, you are required to make conclusions and recommendation which will answer the following questions:
In: Accounting
Personal Electronix sells iPads and iPods. The business is divided into two divisions along product lines. CVP income statements for a recent quarter’s activity are presented below.
|
iPad Division |
iPod Division |
Total |
||||
|---|---|---|---|---|---|---|
| Sales | $755,200 | $424,800 | $1,180,000 | |||
| Variable costs | 543,744 | 246,384 | 790,128 | |||
| Contribution margin | $211,456 | $178,416 | 389,872 | |||
| Fixed costs | 133,151 | |||||
| Net income | $256,721 |
Determine sales mix percentage and contribution margin ratio for each division. (Round answers to 0 decimal places, e.g. 15%.)
|
Sales Mix Percentage |
||
|---|---|---|
| iPad division |
enter a percentage number rounded to 0 decimal places % |
|
| iPod division |
enter a percentage number rounded to 0 decimal places % |
|
Contribution Margin Ratio |
||
|---|---|---|
| iPad division |
enter a percentage number rounded to 0 decimal places % |
|
| iPod division |
enter a percentage number rounded to 0 decimal places % |
eTextbook and Media
Calculate the company’s weighted-average contribution margin ratio. (Round computations and final answer to 2 decimal places, e.g. 15.26%.)
| Weighted-average contribution margin ratio |
enter a percentage number of the weighted-average contribution margin ratio rounded to 2 decimal places % |
eTextbook and Media
Calculate the company’s break-even point in dollars. (Round computations to 2 decimal places and final answer to 0 decimal places, e.g. 1,526.)
| Break-even point |
$enter the break-even point in dollars rounded to 2 decimal places |
eTextbook and Media
Determine the sales level in dollars for each division at the break-even point. (Round computations to 2 decimal places and final answers to 0 decimal places, e.g. 1,526.)
|
Break-even point |
||
|---|---|---|
| iPad division |
$enter a dollar amount rounded to 2 decimal places |
|
| iPod division |
$enter a dollar amount rounded to 2 decimal places |
In: Accounting
In: Accounting
Fickel Company has two manufacturing departments—Assembly and Testing & Packaging. The predetermined overhead rates in Assembly and Testing & Packaging are $27.00 per direct labor-hour and $23.00 per direct labor-hour, respectively. The company’s direct labor wage rate is $29.00 per hour. The following information pertains to Job N-60:
| Assembly | Testing & Packaging | ||||||
| Direct materials | $ | 415 | $ | 55 | |||
| Direct labor | $ | 348 | $ | 87 | |||
Required:
1. What is the total manufacturing cost assigned to Job N-60? (Do not round intermediate calculations.)
2. If Job N-60 consists of 10 units, what is the unit product cost for this job? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
In: Accounting
Discuss the pricing basis on which divisions should offer to transfer goods in order that corporate profit-maximizing decisions should take place.
Word count for this discussion response - 150 words maximum
In: Accounting
Kick and Swing Inc. is a wholesaler of sporting goods equipment for retailers in a local metropolitan area. The company buys sporting goods equipment direct from manufacturers and then resells them to individual retail stores in the regional area. The raw data in Figure 14-20 illustrate some of the information required for the company’s purchase order system. As you can see, this information is characteristic of accounting purchase order systems but is not well organized. In fact, because of the repeating groups in the right-most columns, it cannot even be stored in a database.
| Purchase Order Number | Date | Customer Number | Customer Name | Customer Phone Number | Item Number | Item Description | Unit Cost | Unit | Quantity Ordered |
| 12345 | 01/03/2011 | 123-8209 | Charles Dresser, Inc. | (752)433-8733 | X32655 | Baseballs | $33.69 | dozen | 20 |
| X34598 | Footballs | 53.45 | dozen | 10 | |||||
| Z34523 | Bball Hoops | 34.95 | each | 20 | |||||
| 12346 | 01/03/2011 | 123-6733 | Patrice Schmidt’s | (673)784-4451 | X98673 | Softballs | 35.89 | dozen | 10 |
| X34598 | Footballs | 53.45 | dozen | 5 | |||||
| Sports | X67453 | Soccer balls | 45.36 | dozen | 10 |
FIGURE 14-20 Some purchasing data for Kick and Swing.
Requirements
Store this data in a spreadsheet to make it easy to manipulate. Then perform each of the following tasks in turn:
In: Accounting
write a journal article on financial accounting
In: Accounting
BE9-1 Bali Corp. has $10,000 in surplus funds to invest and is considering investing in either Company A or Company B. Company A promises to return the $10,000 original amount invested in three years’ time and pay a 2% annual return on the principal amount. Company B does not promise to repay the original amount invested, but indicates that it is likely that the $10,000 investment will be worth more than $10,000 if Company B is profitable. Whether Bali will receive an annual return on the investment depends on Company B’s cash flows and whether Company B’s board of directors votes to distribute the cash. (a) Identify whether the potential investments are investments in debt or in equity securities. (b) Explain how you determined your answer.
In: Accounting
Presented below is an income statement for Crane Company for the
year ended December 31, 2020.
| Crane
Company Income Statement For the Year Ended December 31, 2020 |
|||
| Net sales | $786,000 | ||
| Costs and expenses: | |||
| Cost of goods sold | 555,000 | ||
| Selling, general, and administrative expenses | 77,000 | ||
| Other, net | 30,000 | ||
| Total costs and expenses | 662,000 | ||
| Income before income taxes | 124,000 | ||
| Income taxes | 37,200 | ||
| Net income | $86,800 | ||
Additional information:
| 1. | "Selling, general, and administrative expenses" included a usual but infrequent charge of $8,000 due to a loss on the sale of investments. | ||
| 2. | "Other, net" consisted of interest expense, $10,000, and a discontinued operations loss of $20,000 before taxes. If the discontinued operations loss had not occurred, income taxes for 2020 would have been $43,200 instead of $37,200. | ||
| 3. | Crane had 20,000 shares of common stock outstanding during 2020. |
Using the single-step format, prepare a corrected income statement,
including the appropriate per share disclosures.
In: Accounting