Blue Company began operations on January 2, 2016. It employs 10
individuals who work 8-hour days and are paid hourly. Each employee
earns 12 paid vacation days and 7 paid sick days annually. Vacation
days may be taken after January 15 of the year following 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 |
|||||||
| $12 | $13 | 0 | 10 | 5 | 6 | |||||||
Blue Company has chosen not to accrue paid sick leave until used,
and has chosen to accrue vacation time at expected future rates of
pay without discounting. The company used the following projected
rates to accrue vacation time.
|
Year in Which Vacation |
Projected Future Pay Rates |
|
| 2016 | $12.36 | |
| 2017 | 13.34 |
Prepare journal entries to record transactions related to compensated absences during 2016 and 2017
Compute the amounts of any liability for compensated absences that should be reported on the balance sheet at December 31, 2016 and 2017.
In: Accounting
Homestead Oil Corp. was incorporated on January 1, 2016, and issued the following stock for cash:
700,000 shares of no-par common stock were authorized; 150,000 shares were issued on January 1, 2016, at $18.00 per share.
250,000 shares of $110 par value, 8.00% cumulative, preferred stock were authorized, and 71,000 shares were issued on January 1, 2016, at $140 per share.
Net income for the years ended December 31, 2016 and 2017, was $1,450,000 and $2,490,000, respectively.
No dividends were declared or paid during 2016. However, on December 28, 2017, the board of directors of Homestead declared dividends of $1,600,000, payable on February 12, 2018, to holders of record as of January 19, 2018.
Prepare the journal entries to record each of the below transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
The issuance of common stock and preferred stock on January 1, 2016.
The declaration of dividends on December 28, 2017.
The payment of dividends on February 12, 2018.
Note: Enter debits before credits.
|
b. Of the total amount of dividends declared during 2017, how much will be received by preferred shareholders?
|
In: Accounting
|
Benjamin, Inc., operates an export/import business. The company has considerable dealings with companies in the country of Camerrand. The denomination of all transactions with these companies is alaries (AL), the Camerrand currency. During 2015, Benjamin acquires 20,000 widgets at a price of 8 alaries per widget. It will pay for them when it sells them. Currency exchange rates for 1 AL are as follows: |
| September 1, 2015 | $ | 0.46 | |
| December 1, 2015 | 0.44 | ||
| December 31, 2015 | 0.48 | ||
| March 1, 2016 | 0.45 | ||
| a. |
Assume that Benjamin acquired the widgets on December 1, 2015, and made payment on March 1, 2016. What is the effect of the exchange rate fluctuations on reported income in 2015 and in 2016?
|
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In: Accounting
The following are the financial statements of Rigolo Inc.
Balance sheet
|
20116 |
2015 |
|
|
Assets Current assets Cash & cash equivalents Account receivables Inventory Other current assets Total current assets L.T. Assets PPE Total Assets Liabilities & Shareholders’ Equity Current liabilities Accounts payable Current maturities of notes payable Accrued expenses Other current liabilities Total current liabilities L.T. Liabilities Bank loans Total liabilities Shareholders’ equity Common stock Retained earnings Total shareholders equity Total shareholders equity & liab. The balance is well-balanced |
4,100 2,733,148 1,389,390 13,901 4,140,539 322,586 4,463,125 276,556 1,834,858 151,817 128,632 2,391,863 1,824,764 4,216,627 46,499 199,999 246,498 4,463,125 |
3,100 1,941,002 1,468,257 0 3,412,359 60,640 3,472,999 256,419 337,881 169,067 161,905 925,272 2,400,000 3,325,272 46,499 101,228 147,727 3,472,999 |
Statement of income
|
2016 |
2015 |
|
|
Revenue Cost of Good Sold Gross profit on sales Operating expenses Repairs and maintenance Depreciation & Amortization Interest expense Total expenses Net income before taxes Provision for income taxes Net income |
$17,285,211 14,947,152 2,338,059 1,871,538 84,483 25,688 215,246 2,196,955 141,104 42,333 98,771 |
$13,999,979 11,920,400 2,079,579 1,529,231 107,123 24,410 255,003 1,915,767 163,812 65,525 98,287 |
Rigolo Inc, has paid $10,000 to its preferred shareholders in 2016
Tasks: (i) Compute the ROA
(ii) Compute the ROCE
(iii) Compute the Account Receivable Turnover
(iv) Compute the Inventory Turnover
(v) Compute the Basic EPS
(vi) Compute the diluted EPS
Note: Provide for each ratio: the financial meaning and the formula used for its computation. Do not just put numbers.
In: Accounting
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