4. Jellystone National Park is located 10 minutes away from city A and 20 minutes away from city B. Cities A and B have 200; 000 inhabitants each, and residents in both cities have the same income and preferences for national parks. Assume that the cost for an individual to go to a national park is represented by the cost of the time it takes her to get into the park. Also assume that the cost of time for individuals in cities A and B is $:50 per minute. You observe that each inhabitant of city A goes to Jellystone 10 times a year, while each inhabitant of city B goes only 5 times a year. Assume the following: the only people who go to the park are the residents of cities A and B; the cost of running Jellystone is $1; 500; 000 a year; and the social discount rate is 10%. Also assume that the park lasts forever.
(a) Compute the cost per visit to Jellystone for an inhabitant of each city.
(b) Assuming that those two observations (cost per visit and number of visits per inhabitant of city A, and cost per visit and number of visits per inhabitant of city B) correspond to two points on the same linear individual demand curve for visits to Jellystone, derive that individual demand curve (the cost for the price, and the number of visits for the quantity).
(c) With the individual demand curve from (b), calculate the consumer surplus for an inhabitant in city A and in city B, respectively. (Note that inhabitants in the two cities may not pay the same price.) What is the total consumer surplus of the two cities entire population combined?
(d) The total consumer surplus measures the total bene t of the park to the inhabitants in the two cities. There is a timber developer who wants to buy Jellystone to run his business. He is offering $100 million for the park. Should the park be sold? Show the process you obtain your conclusion.
In: Economics
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
April 1 Nozomi invested $39,000 cash and computer equipment worth $35,000 in the company in exchange for common stock. 2 The company rented furnished office space by paying $1,800 cash for the first month’s (April) rent. 3 The company purchased $1,000 of office supplies for cash. 10 The company paid $2,400 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. 14 The company paid $1,300 cash for two weeks' salaries earned by employees. 24 The company collected $22,000 cash on commissions from airlines on tickets obtained for customers. 28 The company paid $1,300 cash for two weeks' salaries earned by employees. 29 The company paid $400 cash for minor repairs to the company's computer. 30 The company paid $1,350 cash for this month's telephone bill. 30 The company paid $1,700 cash in dividends.
The company's chart of accounts follows:
101 Cash 405 Commissions Earned 106 Accounts Receivable 612 Depreciation Expense—Computer Equip. 124 Office Supplies 622 Salaries Expense 128 Prepaid Insurance 637 Insurance Expense 167 Computer Equipment 640 Rent Expense 168 Accumulated Depreciation—Computer Equip. 650 Office Supplies Expense 209 Salaries Payable 684 Repairs Expense 307 Common Stock 688 Telephone Expense 318 Retained Earnings 901 Income Summary 319 Dividends
Use the following information:
Two-thirds (or $133) of one month’s insurance coverage has expired. At the end of the month, $600 of office supplies are still available. This month’s depreciation on the computer equipment is $300. Employees earned $440 of unpaid and unrecorded salaries as of month-end. The company earned $1,900 of commissions that are not yet billed at month-end. Required: 1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts. 3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30. 4. Journalize and post the adjusting entries for the month and prepare the adjusted trial balance. 5a. Prepare the income statement for the month of April 30, 2017. 5b. Prepare the statement of retained earnings for the month of April 30, 2017. 5c. Prepare the balance sheet at April 30, 2017. 6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b. 6b. Post the journal entries to the ledger. 7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
| April | 1 | Nozomi invested $46,000 cash and computer equipment worth $25,000 in the company in exchange for common stock. | ||
| 2 | The company rented furnished office space by paying $1,500 cash for the first month’s (April) rent. | |||
| 3 | The company purchased $1,300 of office supplies for cash. | |||
| 10 | The company paid $2,300 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
| 14 | The company paid $1,600 cash for two weeks' salaries earned by employees. | |||
| 24 | The company collected $17,500 cash on commissions from airlines on tickets obtained for customers. | |||
| 28 | The company paid $1,600 cash for two weeks' salaries earned by employees. | |||
| 29 | The company paid $500 cash for minor repairs to the company's computer. | |||
| 30 | The company paid $1,400 cash for this month's telephone bill. | |||
| 30 | The company paid $2,100 cash in dividends. |
The company's chart of accounts follows:
| 101 | Cash | 405 | Commissions Earned |
| 106 | Accounts Receivable | 612 | Depreciation Expense—Computer Equip. |
| 124 | Office Supplies | 622 | Salaries Expense |
| 128 | Prepaid Insurance | 637 | Insurance Expense |
| 167 | Computer Equipment | 640 | Rent Expense |
| 168 | Accumulated Depreciation—Computer Equip. | 650 | Office Supplies Expense |
| 209 | Salaries Payable | 684 | Repairs Expense |
| 307 | Common Stock | 688 | Telephone Expense |
| 318 | Retained Earnings | 901 | Income Summary |
| 319 | Dividends | ||
Use the following information:
Two-thirds (or $128) of one month’s insurance coverage has expired.
At the end of the month, $600 of office supplies are still available.
This month’s depreciation on the computer equipment is $300.
Employees earned $500 of unpaid and unrecorded salaries as of month-end.
The company earned $2,300 of commissions that are not yet billed at month-end.
Required:
1. & 2. Prepare journal
entries to record the transactions for April and post them to the
ledger accounts in Requirement 6b. The company records prepaid and
unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b,
prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for
the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of
April 30, 2017.
5b. Prepare the statement of retained earnings for
the month of April 30, 2017.
5c. Prepare the balance sheet at April 30,
2017.
6a. Prepare journal entries to close the temporary
accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency,
Adventure Travel. The following transactions occurred during the
company’s first month.
| April | 1 | Nozomi invested $30,000 cash and computer equipment worth $20,000 in the company in exchange for common stock. | ||
| 2 | The company rented furnished office space by paying $1,800 cash for the first month's (April) rent. | |||
| 3 | The company purchased $1,000 of office supplies for cash. | |||
| 10 | The company paid $2,400 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
| 14 | The company paid $1,600 cash for two weeks' salaries earned by employees. | |||
| 24 | The company collected $8,000 cash on commissions from airlines on tickets obtained for customers. | |||
| 28 | The company paid $1,600 cash for two weeks' salaries earned by employees. | |||
| 29 | The company paid $350 cash for minor repairs to the company's computer. | |||
| 30 | The company paid $750 cash for this month's telephone bill. | |||
| 30 | The company paid $1,500 cash in dividends. |
The company's chart of accounts follows:
| 101 | Cash | 405 | Commissions Earned |
| 106 | Accounts Receivable | 612 | Depreciation Expense—Computer Equip. |
| 124 | Office Supplies | 622 | Salaries Expense |
| 128 | Prepaid Insurance | 637 | Insurance Expense |
| 167 | Computer Equipment | 640 | Rent Expense |
| 168 | Accumulated Depreciation—Computer Equip. | 650 | Office Supplies Expense |
| 209 | Salaries Payable | 684 | Repairs Expense |
| 307 | Common Stock | 688 | Telephone Expense |
| 318 | Retained Earnings | 901 | Income Summary |
| 319 | Dividends | ||
Use the following information:
Two-thirds (or $133) of one month’s insurance coverage has expired.
At the end of the month, $600 of office supplies are still available.
This month’s depreciation on the computer equipment is $500.
Employees earned $420 of unpaid and unrecorded salaries as of month-end.
The company earned $1,750 of commissions that are not yet billed at month-end.
Required:
1. & 2. Prepare journal entries to record the
transactions for April and post them to the ledger accounts in
Requirement 6b. The company records prepaid and unearned items in
balance sheet accounts.
3. Using account balances from Requirement 6b,
prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for
the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of
April 30, 2017.
5b. Prepare the statement of retained earnings for
the month of April 30, 2017.
5c. Prepare the balance sheet at April 30,
2017.
6a. Prepare journal entries to close the temporary
accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
| April | 1 | Nozomi invested $41,000 cash and computer equipment worth $25,000 in the company in exchange for common stock. | ||
| 2 | The company rented furnished office space by paying $2,600 cash for the first month’s (April) rent. | |||
| 3 | The company purchased $2,000 of office supplies for cash. | |||
| 10 | The company paid $3,000 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
| 14 | The company paid $1,300 cash for two weeks' salaries earned by employees. | |||
| 24 | The company collected $23,500 cash on commissions from airlines on tickets obtained for customers. | |||
| 28 | The company paid $1,300 cash for two weeks' salaries earned by employees. | |||
| 29 | The company paid $400 cash for minor repairs to the company's computer. | |||
| 30 | The company paid $1,350 cash for this month's telephone bill. | |||
| 30 | The company paid $2,000 cash in dividends. |
The company's chart of accounts follows:
| 101 | Cash | 405 | Commissions Earned |
| 106 | Accounts Receivable | 612 | Depreciation Expense—Computer Equip. |
| 124 | Office Supplies | 622 | Salaries Expense |
| 128 | Prepaid Insurance | 637 | Insurance Expense |
| 167 | Computer Equipment | 640 | Rent Expense |
| 168 | Accumulated Depreciation—Computer Equip. | 650 | Office Supplies Expense |
| 209 | Salaries Payable | 684 | Repairs Expense |
| 307 | Common Stock | 688 | Telephone Expense |
| 318 | Retained Earnings | 901 | Income Summary |
| 319 | Dividends | ||
Use the following information:
Two-thirds (or $167) of one month’s insurance coverage has expired.
At the end of the month, $700 of office supplies are still available.
This month’s depreciation on the computer equipment is $500.
Employees earned $410 of unpaid and unrecorded salaries as of month-end.
The company earned $1,650 of commissions that are not yet billed at month-end.
Required:
1. & 2. Prepare journal
entries to record the transactions for April and post them to the
ledger accounts in Requirement 6b. The company records prepaid and
unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b,
prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for
the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of
April 30, 2017.
5b. Prepare the statement of retained earnings for
the month of April 30, 2017.
5c. Prepare the balance sheet at April 30,
2017.
6a. Prepare journal entries to close the temporary
accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency,
Adventure Travel. The following transactions occurred during the
company’s first month.
| April | 1 | Nozomi invested $30,000 cash and computer equipment worth $20,000 in the company in exchange for common stock. | ||
| 2 | The company rented furnished office space by paying $1,800 cash for the first month's (April) rent. | |||
| 3 | The company purchased $1,000 of office supplies for cash. | |||
| 10 | The company paid $2,400 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
| 14 | The company paid $1,600 cash for two weeks' salaries earned by employees. | |||
| 24 | The company collected $8,000 cash on commissions from airlines on tickets obtained for customers. | |||
| 28 | The company paid $1,600 cash for two weeks' salaries earned by employees. | |||
| 29 | The company paid $350 cash for minor repairs to the company's computer. | |||
| 30 | The company paid $750 cash for this month's telephone bill. | |||
| 30 | The company paid $1,500 cash in dividends. |
The company's chart of accounts follows:
| 101 | Cash | 405 | Commissions Earned |
| 106 | Accounts Receivable | 612 | Depreciation Expense—Computer Equip. |
| 124 | Office Supplies | 622 | Salaries Expense |
| 128 | Prepaid Insurance | 637 | Insurance Expense |
| 167 | Computer Equipment | 640 | Rent Expense |
| 168 | Accumulated Depreciation—Computer Equip. | 650 | Office Supplies Expense |
| 209 | Salaries Payable | 684 | Repairs Expense |
| 307 | Common Stock | 688 | Telephone Expense |
| 318 | Retained Earnings | 901 | Income Summary |
| 319 | Dividends | ||
Use the following information:
Two-thirds (or $133) of one month’s insurance coverage has expired.
At the end of the month, $600 of office supplies are still available.
This month’s depreciation on the computer equipment is $500.
Employees earned $420 of unpaid and unrecorded salaries as of month-end.
The company earned $1,750 of commissions that are not yet billed at month-end.
Required:
1. & 2. Prepare journal entries to record the
transactions for April and post them to the ledger accounts in
Requirement 6b. The company records prepaid and unearned items in
balance sheet accounts.
3. Using account balances from Requirement 6b,
prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for
the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of
April 30, 2017.
5b. Prepare the statement of retained earnings for
the month of April 30, 2017.
5c. Prepare the balance sheet at April 30,
2017.
6a. Prepare journal entries to close the temporary
accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month. April 1 Nozomi invested $43,000 cash and computer equipment worth $20,000 in the company in exchange for common stock. 2 The company rented furnished office space by paying $2,800 cash for the first month’s (April) rent. 3 The company purchased $1,400 of office supplies for cash. 10 The company paid $2,100 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. 14 The company paid $1,300 cash for two weeks' salaries earned by employees. 24 The company collected $17,500 cash on commissions from airlines on tickets obtained for customers. 28 The company paid $1,300 cash for two weeks' salaries earned by employees. 29 The company paid $350 cash for minor repairs to the company's computer. 30 The company paid $850 cash for this month's telephone bill. 30 The company paid $1,700 cash in dividends. The company's chart of accounts follows: 101 Cash 405 Commissions Earned 106 Accounts Receivable 612 Depreciation Expense—Computer Equip. 124 Office Supplies 622 Salaries Expense 128 Prepaid Insurance 637 Insurance Expense 167 Computer Equipment 640 Rent Expense 168 Accumulated Depreciation—Computer Equip. 650 Office Supplies Expense 209 Salaries Payable 684 Repairs Expense 307 Common Stock 688 Telephone Expense 318 Retained Earnings 901 Income Summary 319 Dividends Use the following information: Two-thirds (or $117) of one month’s insurance coverage has expired. At the end of the month, $600 of office supplies are still available. This month’s depreciation on the computer equipment is $400. Employees earned $330 of unpaid and unrecorded salaries as of month-end. The company earned $1,550 of commissions that are not yet billed at month-end. Required: 1. & 2. Prepare journal entries to record the transactions for April and post them to the ledger accounts in Requirement 6b. The company records prepaid and unearned items in balance sheet accounts. 3. Using account balances from Requirement 6b, prepare an unadjusted trial balance as of April 30. 4. Journalize and post the adjusting entries for the month and prepare the adjusted trial balance. 5a. Prepare the income statement for the month of April 30, 2017. 5b. Prepare the statement of retained earnings for the month of April 30, 2017. 5c. Prepare the balance sheet at April 30, 2017. 6a. Prepare journal entries to close the temporary accounts and then post to Requirement 6b. 6b. Post the journal entries to the ledger. 7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
| April | 1 | Nozomi invested $44,000 cash and computer equipment worth $35,000 in the company in exchange for common stock. | ||||||||||||||||||||||||||||||||||||||||||||||||||
| 2 | The company rented furnished office space by paying $2,500 cash for the first month’s (April) rent. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 3 | The company purchased $1,800 of office supplies for cash. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 10 | The company paid $2,300 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 14 | The company paid $1,000 cash for two weeks' salaries earned by employees. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 24 | The company collected $16,500 cash on commissions from airlines on tickets obtained for customers. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 28 | The company paid $1,000 cash for two weeks' salaries earned by employees. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 29 | The company paid $400 cash for minor repairs to the company's computer. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 30 | The company paid $1,200 cash for this month's telephone bill. | |||||||||||||||||||||||||||||||||||||||||||||||||||
| 30 |
The company paid $2,400 cash in dividends. The company's chart of accounts follows:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
| April | 1 | Nozomi invested $34,000 cash and computer equipment worth $35,000 in the company in exchange for common stock. | ||
| 2 | The company rented furnished office space by paying $1,700 cash for the first month’s (April) rent. | |||
| 3 | The company purchased $1,900 of office supplies for cash. | |||
| 10 | The company paid $3,000 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
| 14 | The company paid $1,200 cash for two weeks' salaries earned by employees. | |||
| 24 | The company collected $19,500 cash on commissions from airlines on tickets obtained for customers. | |||
| 28 | The company paid $1,200 cash for two weeks' salaries earned by employees. | |||
| 29 | The company paid $400 cash for minor repairs to the company's computer. | |||
| 30 | The company paid $1,000 cash for this month's telephone bill. | |||
| 30 | The company paid $1,600 cash in dividends. |
The company's chart of accounts follows:
| 101 | Cash | 405 | Commissions Earned |
| 106 | Accounts Receivable | 612 | Depreciation Expense—Computer Equip. |
| 124 | Office Supplies | 622 | Salaries Expense |
| 128 | Prepaid Insurance | 637 | Insurance Expense |
| 167 | Computer Equipment | 640 | Rent Expense |
| 168 | Accumulated Depreciation—Computer Equip. | 650 | Office Supplies Expense |
| 209 | Salaries Payable | 684 | Repairs Expense |
| 307 | Common Stock | 688 | Telephone Expense |
| 318 | Retained Earnings | 901 | Income Summary |
| 319 | Dividends | ||
Use the following information:
Required:
1. & 2. Prepare journal
entries to record the transactions for April and post them to the
ledger accounts in Requirement 6b. The company records prepaid and
unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b,
prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for
the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of
April 30, 2017.
5b. Prepare the statement of retained earnings for
the month of April 30, 2017.
5c. Prepare the balance sheet at April 30,
2017.
6a. Prepare journal entries to close the temporary
accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.
In: Accounting
On April 1, 2017, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company’s first month.
| April | 1 | Nozomi invested $30,000 cash and computer equipment worth $30,000 in the company in exchange for common stock. | ||
| 2 | The company rented furnished office space by paying $2,000 cash for the first month’s (April) rent. | |||
| 3 | The company purchased $1,800 of office supplies for cash. | |||
| 10 | The company paid $2,300 cash for the premium on a 12-month insurance policy. Coverage begins on April 11. | |||
| 14 | The company paid $1,700 cash for two weeks' salaries earned by employees. | |||
| 24 | The company collected $20,000 cash on commissions from airlines on tickets obtained for customers. | |||
| 28 | The company paid $1,700 cash for two weeks' salaries earned by employees. | |||
| 29 | The company paid $550 cash for minor repairs to the company's computer. | |||
| 30 | The company paid $850 cash for this month's telephone bill. | |||
| 30 | The company paid $1,900 cash in dividends. |
The company's chart of accounts follows:
| 101 | Cash | 405 | Commissions Earned |
| 106 | Accounts Receivable | 612 | Depreciation Expense—Computer Equip. |
| 124 | Office Supplies | 622 | Salaries Expense |
| 128 | Prepaid Insurance | 637 | Insurance Expense |
| 167 | Computer Equipment | 640 | Rent Expense |
| 168 | Accumulated Depreciation—Computer Equip. | 650 | Office Supplies Expense |
| 209 | Salaries Payable | 684 | Repairs Expense |
| 307 | Common Stock | 688 | Telephone Expense |
| 318 | Retained Earnings | 901 | Income Summary |
| 319 | Dividends | ||
Use the following information:
Required:
1. & 2. Prepare journal
entries to record the transactions for April and post them to the
ledger accounts in Requirement 6b. The company records prepaid and
unearned items in balance sheet accounts.
3. Using account balances from Requirement 6b,
prepare an unadjusted trial balance as of April 30.
4. Journalize and post the adjusting entries for
the month and prepare the adjusted trial balance.
5a. Prepare the income statement for the month of
April 30, 2017.
5b. Prepare the statement of retained earnings for
the month of April 30, 2017.
5c. Prepare the balance sheet at April 30,
2017.
6a. Prepare journal entries to close the temporary
accounts and then post to Requirement 6b.
6b. Post the journal entries to the ledger.
7. Prepare a post-closing trial balance.
In: Accounting