Emma Engineering Group receives royalties on a technical manual written by two of its engineers and sold to a publishing company. Royalties are 10% of net sales, receivable on October 1 for sales in January through June and on April 1 for sales in July through December of the prior year. Sales of the manual began in July 2015, and Emma accrued royalty revenue on $30,400 of sales at December 31, 2015.
Emma received royalties of $2,889 on April 1, 2016. By what amount will Emma debit or credit royalty revenue on April 1?
Answer with the amount and either a D or C right beside the amount no space. Example: if your answer is $1,000 debit, put 1,000D
In: Accounting
Jordan Enterprises has estimated the contribution margin P−MCPP−MCP for its Air Express model of basketball shoes to be 40 percent. Based on market research and past experience, Jordan estimates the following relationship between the sales for Air Express and advertising/promotional outlays:
|
Advertising/Promotional Outlays |
Sales Revenue |
|---|---|
|
($) |
($) |
| 500,000 | 4,000,000 |
| 600,000 | 4,500,000 |
| 700,000 | 4,900,000 |
| 800,000 | 5,200,000 |
| 900,000 | 5,450,000 |
| 1,000,000 | 5,600,000 |
What is the marginal revenue from an additional dollar spent on advertising if the firm is currently spending $1,000,000 on advertising?_
What level of advertising would you recommend to Jordan’s management? (800,000, 600,000, 1,000,000, 900,000, 500,000, or 700,000 .
In: Accounting
A business with $50,000 in assets is currently generating accounting costs of $2,000 and expects a normal rate of return of 10%. Which of the following must be true.
I. The firm has a total economic costs of more than $6500
II. If the firm has no other source of economic costs, then it should close the business if the total revenue is $8,000
III. If the total revenue is $5700, then the firm can be making an economic profit if the owner is doing some of the work herself.
a) None of them must be true
b) Only I must be true
c) Only II must be true
d) Only I and II must be true
e) All 3 must be true
In: Economics
The exclusive Swink Golf Driving Range has had a standard price of $18.00 per hour. The facility has 41 golfing stations, with average usage of 50%, 9 hours a day, 7 days a week. Morgan Swink, the owner, would like to enhance revenue. He proposes new pricing at $14 per hour on weekdays and $25 per hour on weekends. He estimates that weekday usage will increase to 60% and weekend usage will remain at 50%, even with the price increase. Variable cost is a consistent $3 per hour. Which strategy is better? Total revenue under the current pricing is $ nothing (round your response to the nearest dollar)
In: Operations Management
The following table depicts the price and cost structure of a profit-maximizing firm:
Quantity | Price per Unit | Total Cost |
0 | 25 | 10 |
1 | 25 | 15 |
2 | 25 | 30 |
3 | 25 | 55 |
4 | 25 | 90 |
5 | 25 | 135 |
a.) What is the firm’s fixed cost?
b.) What is the variable cost of producing two units of output?
c.) What is the marginal cost of the second unit produced?
d.) What is the firm’s total revenue from selling two units of output?
e.) What is the marginal revenue from the second unit sold?
f.) What is the firm’s profit-maximizing level of output?
In: Economics
James House is planning on starting a cleaning services business but has not decided whether he should focus on residential clients or commercial clients. His estimates of revenue, variable expenses, and fixed expenses are shown below.
| Residential | Commercial | |
| Revenue | $25 per hour | $35 per hour |
| Variable expense | $15 per hour | $20 per hour |
| Fixed expense | $500 per month | $825 per hour |
Required:
1. At what volume of hours per month will James be indifferent between focusing on residential versus commercial clients?
2. Calculate the number of break-even hours for residential clients and commercial clients.
In: Accounting
|
On December 31, 2016, Ditka Inc. had Retained Earnings of $279,800 before its closing entries were prepared and posted. During 2016, the company had service revenue of $180,100 and interest revenue of $87,300. The company used supplies in the amount of $93,900, advertising expenses were $17,600, salaries and wages totaled $20,100, and income tax expense was calculated as $16,100. During the year, the company declared and paid dividends of $7,200. |
| Required: |
| a. | Prepare the closing entries dated December 31, 2016. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) |
| b. |
Prepare T-account for the Retained Earnings account. |
In: Accounting
Emma Engineering Group receives royalties on a technical manual written by two of its engineers and sold to a publishing company. Royalties are 10% of net sales, receivable on October 1 for sales in January through June and on April 1 for sales in July through December of the prior year. Sales of the manual began in July 2015, and Emma accrued royalty revenue on $34,400 of sales at December 31, 2015. Emma received royalties of $3,853 on April 1, 2016. By what amount will Emma debit or credit royalty revenue on April 1? Answer with the amount and either a D or C right beside the amount no space. Example: if your answer is $1,000 debit, put 1,000D
In: Accounting
On January 1, 2017, Monty Company purchased 9% bonds having a maturity value of $290,000, for $313,782.32. The bonds provide the bondholders with a 7% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest receivable January 1 of each year. Monty Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category.
Prepare the journal entry at the date of the bond purchase.
Prepare a bond amortization schedule.
Prepare the journal entry to record the interest revenue and the amortization at December 31, 2017.
Prepare the journal entry to record the interest revenue and the amortization at December 31, 2018.
In: Accounting
Solomon Company, which expects to start operations on January 1, 2018, will sell digital cameras in shopping malls. Solomon has budgeted sales as indicated in the following table. The company expects a 10 percent increase in sales per month for February and March. The ratio of cash sales to sales on account will remain stable from January through March.
Required
Complete the sales budget by filling in the missing amounts.
|
Determine the amount of sales revenue Solomon will report on its first quarter pro forma income statement.
Sales Revenue: _____
In: Accounting