On January 1, 2016, Knorr Corporation issued $1,400,000 of 6%, 5-year bonds dated January 1, 2016. The bonds pay interest annually on December 31. The bonds were issued to yield 7%. Bond issue costs associated with the bonds totaled $27,560.53.
Required: Prepare the journal entries to record the following:
January 1, 2016 Sold the bonds at an effective rate of 7%
December 31, 2016 First interest payment using the effective interest method
December 31, 2016 Amortization of bond issue costs using the straight-line method
December 31, 2017 Second interest payment using the effective interest method
December 31, 2017 Amortization of bond issue costs using the straight-line method
In: Accounting
On april 1, 2016 SBD corp paid $120000 for rent on warehouse space one year in advance. On october 1 2016 SBD corp entered into a lease agreement to rent out its old warehouse space it was no longer using. This agreement calls for SBD to receive $8000 per month from the lessee, due and payable at the end of the 4 month lease term. At december 31 2016 none of the rental payments from the lessee had yet been received.
1) if SBD makes the appropirate adjusting entry how much will be reported on the december 31 2016 income statement for rent expense
2) If SBD makes the appropriate adjusting entry how much will be reported on the december 31 2016 balance ssheet as prepaid rent and rent receivable respectively
In: Accounting
On January 1, 2016, Knorr Corporation issued $800,000 of 6%, 5-year bonds dated January 1, 2016. The bonds pay interest annually on December 31. The bonds were issued to yield 7%. Bond issue costs associated with the bonds totaled $18,848.31.
Required:
Prepare the journal entries to record the following:
January 1, 2016, Sold the bonds at an effective rate of 7%
December 31, 2016, First interest payment using the effective interest method
December 31, 2016, Amortization of bond issue costs using the straight-line method
December 31, 2017, Second interest payment using the effective interest method
December 31, 2017, Amortization of bond issue costs using the straight-line method
In: Accounting
The notes receivable held by the Tolleson Company on August 3, 2016, are summarized below. On August 4, 2016, Tolleson discounted all of these notes at Neighborhood Bank and Trust at a discount rate of 12 percent. Note No. Date Face Amount Period Interest Rate 31 Apr. 4, 2016 $ 33,000 6 months 10 % 32 June 11, 2016 17,100 120 days 7 % 33 July 31, 2016 14,800 60 days 12 % Compute the net proceeds received from discounting each note. (Use 360 days a year.) Analyze: What is the net interest income or expense to be reported from these transactions assuming all notes are paid when due? (Do not round intermediate calculations and round your final answer to 2 decimal places.)
In: Accounting
The following information is extracted from Shelton Corporation’s accounting records at the beginning of 2016:
| Accounts Receivable | $64,000 | |
| Allowance for Doubtful Accounts | 1,300 | (credit) |
During 2016, sales on credit amounted to $574,000, $551,800 was collected on outstanding receivables and $3,200 of receivables were written off as uncollectible. On December 31, 2016, Shelton estimates its bad debts to be 4% of the outstanding gross accounts receivable balance.
| Required: | |
| 1. | Prepare the journal entry necessary to record Shelton’s estimate of bad debt expense for 2016. |
| 2. | Prepare the Accounts Receivable section of Shelton’s December 31, 2016, balance sheet. |
| 3. | Compute Shelton’s receivables turnover. (Round to one decimal place.) |
| 4. | If Sheldon uses IFRS, what might be the heading for the accounts receivable section in Requirement 2? |
In: Accounting
On January 1, 2016, Knorr Corporation issued $800,000 of 6%, 5-year bonds dated January 1, 2016. The bonds pay interest annually on December 31. The bonds were issued to yield 7%. Bond issue costs associated with the bonds totaled $18,848.31. Required: Prepare the journal entries to record the following: January 1, 2016 Sold the bonds at an effective rate of 7% December 31, 2016 First interest payment using the effective interest method December 31, 2016 Amortization of bond issue costs using the straight-line method December 31, 2017 Second interest payment using the effective interest method December 31, 2017 Amortization of bond issue costs using the straight-line method
In: Accounting
The January 28, 2017 (fiscal year 2016) financial statements of Caleres, Inc. reported the following information (in thousands):
|
Caleres, Inc. |
2016 |
2015 |
|
Cost of sales |
$1,517,397 |
$1,529,527 |
|
Inventories, net |
585,764 |
546,745 |
|
LIFO reserve |
4,345 |
4,094 |
The footnotes to the 2016 financial statements of Skechers U.S.A., Inc. reported that the company uses the FIFO method of accounting for inventories. Financial statements reported the following (in thousands):
|
Skechers U.S.A., Inc. |
2016 |
2015 |
|
Cost of sales |
$1,928,715 |
$1,723,315 |
|
Inventories, net |
700,515 |
620,247 |
a. Calculate the two companies’ days-inventory-outstanding ratios for 2016 to allow for a comparison.
b. Which company is more efficient with its inventory?
c. Suggest two ways that Calares might improve the days-inventory-outstanding.
In: Finance
Question (Call Option) On August 15, 2016, Outkast Co. invested idle cash by purchasing a call option on Counting
Crows Inc. common shares for $360. The notional value of the call option is 400 shares, and the option price is $40. The option
expired on January 31, 2017. The following data are available concerning the call option.
Market Price of Counting Time Value of Call
Date Crows Shares Option
September 30, 2016 $48 per share $180
December 31, 2016, 46 per share 65
January 15, 2017, 47 per share 30
Instructions
Prepare the journal entries for Outkast for the following dates.
(a) Investment in a call option on Counting Crows shares on August 15, 2016.
(b) September 30, 2016—Outkast prepares financial statements.
(c) December 31, 2016—Outkast prepares financial statements.
(d) January 15, 2017—Outkast settles the call option on the Counting Crows shares.
In: Computer Science
Meridian Industries manufactures and sells two models of watches, Prime and Luxuria. It expects to sell 3,000 units of Prime and 1,000 units of Luxuria in 2016.The following estimates are given for 2016:
Prime Luxuria
Selling price $200 $500
Direct materials 20 50
Direct labor 40 150
Manufacturing overhead 40 100
Meridian had an inventory of 200 units of Prime and 75 units of Luxuria at the end of 2015. It has decided that as a measure to counter stock outages it will maintain ending inventory of 350 units of Prime and 200 units of Luxuria. Each Luxuria watch requires one unit of Crimpson and has to be imported at a cost of $10. There were 100 units of Crimpson in stock at the end of 2015.The management does not want to have any stock of Crimpson at the end of 2016.
How many units of Prime watches must be produced in 2016?
What is the amount budgeted for purchase of Crimpson in 2016?
What is the total budgeted cost of sold for Meridian Industries in 2016?
In: Accounting
Sweet Acacia Incorporated began operations on January 2, 2016.
Sweet Acacia employs 10 individuals who work 8-hour days and are
paid hourly. Each employee earns 12 paid vacation days and 5 paid
sick days annually. Vacation days may be taken after February 28 of
the year in which they are earned. Sick days may be taken as soon
as they are earned; unused sick days accumulate. Additional
information is as follows.
Actual Hourly | Vacation Days Used | Sick Days Used | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
2016 | 2017 | 2016 | 2017 | 2016 | 2017 | |||||||
| $11 | $13 | 2 | 10 | 4 | 3 | |||||||
Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2016 and 2017.
2016 | 2017 | |||
|---|---|---|---|---|
| Vacation Wages Payable | $enter a dollar amount | $enter a dollar amount | ||
| Sick Pay Wages Payable | $enter a dollar amount |
In: Accounting