Zebra Company manufactures custom-designed skins (covers) for iPods® and other portable MP3 devices. Variable costs are $12.00 per custom skin, the price is $20, and fixed costs are $144,800. Required:

1.What is the contribution margin for one custom skin? Round your answer to the nearest cent. $ per custom skin

2. How many custom skins must Zebra Company sell to break even? custom skins

3. If Zebra Company sells 19,000 custom skins, what is the operating income? $

4. Calculate the margin of safety in units and in sales revenue if 19,000 custom skins are sold. Margin of safety in units units Margin of safety in sales revenue $

A project manager is evaluating a project and initially forecasts that the project will lasts for four years and has its annual marketing and support costs of $1,000,000 and its annual revenue of $10,000,000. The project pays a 40% tax rate on its pre-tax income and its cost of capital is 15%. While analysing a situation that competitors can run their big promotion programs during the project’s life, the manager proposes one solution to the situation by increasing the marketing and support costs by 60% of the originally forecasted level and simultaneously lowering the forecasted revenue by 30% of the originally forecasted level. The change in the net present value (NPV) of the project is closest to:

A project manager is evaluating a project and initially forecasts that the project will lasts for four years and has its annual marketing and support costs of $1,000,000 and its annual revenue of $10,000,000. The project pays a 40% tax rate on its pre-tax income and its cost of capital is 15%. While analysing a situation that competitors can run their big promotion programs during the project’s life, the manager proposes one solution to the situation by increasing the marketing and support costs by 60% of the originally forecasted level and simultaneously lowering the forecasted revenue by 30% of the originally forecasted level. The change in the net present value (NPV) of the project is closest to:

A. -$6,656,717.44

B. $6,166,753.26

C. $6,656,717.44

D. -$6,166,753.26

Malibu Corporation has monthly fixed costs of $66,000. It sells two products for which it has provided the following information.

Sales Price Contribution Margin

Product 1 $ 15 $ 9

Product 2 20 4

a. What total monthly sales revenue is required to break even if the relative sales mix is 30 percent for Product 1 and 70 percent for Product 2? (Round your answer to the nearest dollar amount.)

b. What total monthly sales revenue is required to earn a monthly operating income of $16,000 if the relative sales mix is 20 percent for Product 1 and 80 percent for Product 2? (Round your answer to the nearest dollar amount.)

2.

The following is a partial trial balance for General Lighting Corporation as of December 31, 2021:

There were 300,000 shares of common stock outstanding throughout 2021. Income tax expense has not yet been recorded. The income tax rate is 25%.

Required:

1. Prepare a single-step income statement for 2021, including EPS disclosures.

2. Prepare a multiple-step income statement for 2021, including EPS disclosures.

Dowe Cheatem & Howe, a law firm, started 2017 with accounts receivable of $60,000 and an allowance for uncollectible accounts of $5,000. The 2017 service revenue on account was $400,000, and cash collections on account totalled $410,000. During 2017, Dowe Cheatem & Howe wrote off uncollectible accounts receivable of $7,000. At December 31, 2017, the aging-of-receivables method indicated that Dowe Cheatem & Howe will not collect $10,000 of its accounts receivable. Journalize Dowe Cheatem & Howe
(a) service revenue, (b) cash collections on account,
(c) write-offs of uncollectible receivables, and (d) bad debt expense for the year.

Prepare a T-account for Allowance for Uncollectible Accounts to show your computation of bad debt e

Indigo Company is involved in four separate industries. The following information is available for each of the four industries.

Determine which of the operating segments are reportable based on the:

a. A US corporation has an account payable to an unrelated Irish company in 90 days. The amount of the payable is €500,000. The spot exchange rate for the euro is EUR/USD 1.2131. The company’s combined federal and state income tax rate is 27.3%; the Irish corporate income tax rate is 12.5%. The company expects the exchange rate for the euro to decline to 1.2030 prior to the account’s due date. When should the company make the payment? Explain.

b. If the payee on the account is an affiliated corporation, when should the company make the payment? Explain.

c. What is the payment described in part b called? How can the company justify the amount of the payment if it is challenged by the US Internal Revenue Service or Ireland’s Revenue authority?

On January 1, 2017, Metlock Company purchased 8% bonds having a maturity value of $240,000, for $260,219.71. The bonds provide the bondholders with a 6% yield. They are dated January 1, 2017, and mature January 1, 2022, with interest receivable January 1 of each year. Metlock Company uses the effective-interest method to allocate unamortized discount or premium. The bonds are classified in the held-to-maturity category.

1.)Prepare the journal entry at the date of the bond purchase.

2.)Prepare a bond amortization schedule.

3.)Prepare the journal entry to record the interest revenue and the amortization at December 31, 2017.

4.)Prepare the journal entry to record the interest revenue and the amortization at December 21, 2018.