New Approaches to Revenue Recognitions
Must include the following:
1. Historical development of financial accounting theory.
2. Current GAAP.
3. Compare and contrast U.S. GAAP and IFRS in respect to your topic.
4. Suggested changes or problem areas revealed in the debate arena.
5. Analyze points 2 and 3 in relation to the Conceptual Framework (include qualitative characteristics of useful information).
6. Suggest appropriate courses of action.
7. Provide a biblical application, supported by Scripture, in respect to your topic.
In: Accounting
Discuss carefully how import tariffs, import quotas, and VERs affect consumers, producers and government revenue in the importing country? Which import barriers is less distorting and why?
In: Economics
Sharp Focus Technology Ltd (Sharp) manufactures and sells three models of camera. Sales revenue and direct costs for November of 2019 are shown as follows: Model Beginner Intermediate Pro-level
Units produced and sold 400 200 100
Unit selling price $6,000 $15,000 $33,000 Direct materials $700,000 $1,600,000 $1,820,000 Direct labour $600,000 $750,000 $840,000 Machine hours consumed 300 90 60
Manufacturing overhead incurred in the month includes the following: Activity $ Engineering 300,000 Quality control 298,500 Machinery 751,500 Materials handling 300,000
-------------- 1,650,000.
The company adopts a simple costing system by allocating the manufacturing overhead based on the machine hours which are used to manufacture the three models.
Sharp’s CEO recently has learned that an activity-based costing system can provide more accurate cost information through analysing how the products use the activities during the operating processes. The following data were collected from operations in the quarter: Activity Cost driver Beginner Intermediate Pro-level Engineering No. of engineering hours 6 10 24 Quality control No. of inspection hours 36 120 204 Machinery No. of machine hours 300 90 60 Materials handling No. of orders 5 5 20
Required:
a ) Prepare a product line income statement showing the profitability % of each model: i using the current simple costing system ii using the activity-based costing system Show all workings clearly.
b) Compare and explain the differences in profitability of the three product models under both product costing systems. What are the implications for Sharp’s pricing strategy?
In: Accounting
The contribution margin income statement of Krazy Kustard Donuts for August 2016
Sales Revenue: $125,000
Variable Costs: COGS: $32,100, Selling Costs: $17,100, Administrative Costs: $800
Contribution Margin: $75,000
Fixed Costs: Selling Costs: $32,400, Administrative Costs: $10,800
Operating Income: $31,800
Krazy Kustard sells 4 dozen plain donuts for every dozen custard-filled donuts. A dozen plain donuts sells for $4.00, with total variable cost of $1.60 per dozen. A dozen custard-filled donuts sells for $8.00, with total variable cost of $ $3.20 per dozen.
1)Calculate the Weighted-Average Contribution margin.
2) Determine Krazy Kustard's monthly breakeven point in dozens of plain donuts and custard filled donuts. Prove your answer in preparing a summary contribution margin income statement at the breakeven level of sales. Show only 2 catagories of costs: Variable and fixed.
3)Compute Krazy Kustard's margin of safety in Dollars.
4)Compute the degree of operating leverage for Krazy Kustard Donuts. Estimate the new operating income if total sales increase by 40%. (Round the degree of operating leverage to 4 decimal places and the final answer to the nearest dollar. Assume the sales mix remains unchanged.)
5) Prove your answer to requirement 4 by preparing a contribution margin income statement with a 40% increase in total sales. (The sales mix remains unchanged)
In: Accounting
In: Economics
During the year ended December 31, 2018, Kelly’s Camera Shop had sales revenue of $195,000, of which $97,500 was on credit. At the start of 2018, Accounts Receivable showed a $12,000 debit balance and the Allowance for Doubtful Accounts showed a $650 credit balance. Collections of accounts receivable during 2018 amounted to $73,000.
Data during 2018 follow:
Required:
1. Give the required journal entries for the two events in December.
1. a. Record the write-off of a certain customer account from a prior year which is not collectible totaling $1,750.
2. Record the estimated bad debt losses at 2 percent of credit sales for the year.
2. a. Show how the amounts related to Accounts Receivable and Bad Debt Expense would be reported on the balance sheet and income statement for 2018.
| Kelly's Camera Shop | |
| Income Statement (partial) | |
| Year ending December 31, 2018 | |
| Operating Expenses |
2. b. Show how the amounts related to Accounts Receivable would be
reported on the balance sheet?
| Kelly's Camera Shop | |
| Balance Sheet (partial) | |
| At December 31, 2018 | |
| Current Assets |
3. On the basis of the data available, does the 2 percent rate appear to be reasonable?
In: Accounting
Redbird Properties, Inc. gathered the following information regarding the asset, liability, stockholders’ equity, revenue, and expense accounts as of the end of its second year in operations, December 31, 2019:
|
Rent Expense |
$7,000 |
|
Building |
36,320 |
|
Depreciation Expense |
4,750 |
|
Cost of Goods Sold |
10,000 |
|
Accounts Receivable |
8,200 |
|
Note Payable (5 yr) |
11,000 |
|
Common Stock |
16,970 |
|
Cash |
19,500 |
|
Salary Expense |
4,400 |
|
Dividends |
10,200 |
|
Retained Earnings, Jan 1 2015 |
17,085 |
|
Accounts Payable |
11,800 |
|
Accumulated Depreciation (Building) |
6,500 |
|
Income Tax Expense |
6,585 |
|
Sales |
48,800 |
|
Prepaid Rent |
2,500 |
|
Inventory |
2,000 |
|
Interest Expense |
700 |
Prepare, in good form, the heading and Asset section only of the classified Balance Sheet for Redbird Properties, Inc. for 2019. You will prepare the Liabilities & Stockholders' Equity section in the next question. (You can receive partial credit.)
| Blank 1. Fill in the blank, read surrounding text. | |||
| Blank 2. Fill in the blank, read surrounding text. | |||
| Blank 3. Fill in the blank, read surrounding text. | |||
| Blank 4. Fill in the blank, read surrounding text. | Blank 5. Fill in the blank, read surrounding text. | Blank 6. Fill in the blank, read surrounding text. | Blank 7. Fill in the blank, read surrounding text. |
| Blank 8. Fill in the blank, read surrounding text. | Blank 9. Fill in the blank, read surrounding text. | Blank 10. Fill in the blank, read surrounding text. | Blank 11. Fill in the blank, read surrounding text. |
| Blank 12. Fill in the blank, read surrounding text. | Blank 13. Fill in the blank, read surrounding text. | Blank 14. Fill in the blank, read surrounding text. | Blank 15. Fill in the blank, read surrounding text. |
| Blank 16. Fill in the blank, read surrounding text. | Blank 17. Fill in the blank, read surrounding text. | Blank 18. Fill in the blank, read surrounding text. | Blank 19. Fill in the blank, read surrounding text. |
| Blank 20. Fill in the blank, read surrounding text. | Blank 21. Fill in the blank, read surrounding text. | Blank 22. Fill in the blank, read surrounding text. | Blank 23. Fill in the blank, read surrounding text. |
| Blank 24. Fill in the blank, read surrounding text. | Blank 25. Fill in the blank, read surrounding text. | Blank 26. Fill in the blank, read surrounding text. | Blank 27. Fill in the blank, read surrounding text. |
| Blank 28. Fill in the blank, read surrounding text. | Blank 29. Fill in the blank, read surrounding text. | Blank 30. Fill in the blank, read surrounding text. | Blank 31. Fill in the blank, read surrounding text. |
| Blank 32. Fill in the blank, read surrounding text. | Blank 33. Fill in the blank, read surrounding text. | Blank 34. Fill in the blank, read surrounding text. | Blank 35. Fill in the blank, read surrounding text. |
| Blank 36. Fill in the blank, read surrounding text. | Blank 37. Fill in the blank, read surrounding text. | Blank 38. Fill in the blank, read surrounding text. | Blank 39. Fill in the blank, read surrounding text. |
| Blank 40. Fill in the blank, read surrounding text. | Blank 41. Fill in the blank, read surrounding text. | Blank 42. Fill in the blank, read surrounding text. | Blank 43. Fill in the blank, read surrounding text. |
| Blank 44. Fill in the blank, read surrounding text. | Blank 45. Fill in the blank, read surrounding text. | Blank 46. Fill in the blank, read surrounding text. | Blank 47. Fill in the blank, read surrounding text. |
| Blank 48. Fill in the blank, read surrounding text. | Blank 49. Fill in the blank, read surrounding text. | Blank 50. Fill in the blank, read surrounding text. | Blank 51. Fill in the blank, read surrounding text. |
| Blank 52. Fill in the blank, read surrounding text. | Blank 53. Fill in the blank, read surrounding text. | Blank 54. Fill in the blank, read surrounding text. | Blank 55. Fill in the blank, read surrounding text. |
| Blank 56. Fill in the blank, read surrounding text. | Blank 57. Fill in the blank, read surrounding text. | Blank 58. Fill in the blank, read surrounding text. | Blank 59. Fill in the blank, read surrounding text. |
| Blank 60. Fill in the blank, read surrounding text. | Blank 61. Fill in the blank, read surrounding text. | Blank 62. Fill in the blank, read surrounding text. | Blank 63. Fill in the blank, read surrounding text. |
| Blank 64. Fill in the blank, read surrounding text. | Blank 65. Fill in the blank, read surrounding text. | Blank 66. Fill in the blank, read surrounding text. | Blank 67. Fill in the blank, read surrounding text. |
| Blank 68. Fill in the blank, read surrounding text. | Blank 69. Fill in the blank, read surrounding text. | Blank 70. Fill in the blank, read surrounding text. | Blank 71. Fill in the blank, read surrounding text. |
| Blank 72. Fill in the blank, read surrounding text. | Blank 73. Fill in the blank, read surrounding text. | Blank 74. Fill in the blank, read surrounding text. | Blank 75. Fill in the blank, read surrounding text. |
| Blank 76. Fill in the blank, read surrounding text. | Blank 77. Fill in the blank, read surrounding text. | Blank 78. Fill in the blank, read surrounding text. | Blank 79. Fill in the blank, read surrounding text. |
In: Accounting
Briefly describe the five-step process.
Explain the importance of contracts when analyzing revenue arrangements.
How are fair value measurement concepts applied in implementation of the five-step process?
How does the five-step process reflect application of the definitions of assets and liabilities?
In: Accounting
1. Initial franchise fee revenue should be recognized when all material services or conditions relating to the sale have been substantially performed by the franchisor.
True or False
2. Under ASC Topic 606 for revenue recognition, a performance obligation is considered satisfied when control over the goods and services is transferred to the customer. Which of the following is not an indicator that control has transferred?
a. All of these are indicators that control has transferred.
b. The customer is legally obligated to pay for the goods or services.
c. The customer has legal title of the goods.
d. The customer has accepted the goods and has physical possession of the goods.
3. Balance sheets prepared in compliance with U.S. GAAP reflect a mixture of:
a. current value and discounted future cash flows.
b. discounted cash flows and future values.
c. historical cost and future cash values.
d. historical cost, fair value, net realizable value, and discounted present values.
4. The balance sheet provides information on all of the following except:
a. the market price of the company’s stock.
b. where the money came from.
c. how management invested its money.
d. assessing rates of return.
5. Current liabilities are reported on the balance sheet at:
a. future value.
b. historical cost.
c. discounted present value.
d. current market value.
6. Joe Carie, head accountant, is using the indirect method and the account balance from the balance sheet and income statement to prepare a statement of cash flows. Joe would use an increase in Accumulated Depreciation to:
a. increase cash flow from operating activities.
b. decrease cash flow from investing activities.
c. decrease cash flow from operating activities.
d. increase cash flow from investing activities.
In: Accounting
Moyas Corporation sells a single product for $20 per unit. Last year, the company's sales revenue was $300,000 and its net operating income was $16,000. If fixed expenses totaled $104,000 for the year, the break-even point in unit sales was:
Multiple Choice
9,000 units
13,000 units
15,000 units
15,800 units
In: Accounting