Pargo Company is preparing its master budget for 2020. Relevant data pertaining to its sales, production, and direct materials budgets are as follows.
| Sales. Sales for the year are expected to total 2,000,000 units. Quarterly sales are 18%, 26%, 23%, and 33%, respectively. The sales price is expected to be $38 per unit for the first three quarters and $45 per unit beginning in the fourth quarter. Sales in the first quarter of 2021 are expected to be 15% higher than the budgeted sales for the first quarter of 2020. |
| Production. Management desires to maintain the ending finished goods inventories at 25% of the next quarter’s budgeted sales volume. |
| Direct materials. Each unit requires 2 pounds of raw materials at a cost of $10 per pound. Management desires to maintain raw materials inventories at 10% of the next quarter’s production requirements. Assume the production requirements for first quarter of 2021 are 504,000 pounds. |
Prepare the sales, production, and direct materials budgets by
quarters for 2020.
In: Accounting
In 2018, the Westgate Construction Company entered into a
contract to construct a road for Santa Clara County for
$10,000,000. The road was completed in 2020. Information related to
the contract is as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,610,000 | $ | 3,162,000 | $ | 2,230,800 | |||
| Estimated costs to complete as of year-end | 6,390,000 | 2,028,000 | 0 | ||||||
| Billings during the year | 2,100,000 | 3,672,000 | 4,228,000 | ||||||
| Cash collections during the year | 1,850,000 | 3,000,000 | 5,150,000 | ||||||
Westgate recognizes revenue over time according to percentage of completion.
4. Calculate the amount of revenue and gross
profit (loss) to be recognized in each of the three years assuming
the following costs incurred and costs to complete information.
(Do not round intermediate calculations and round your
final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.)
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,610,000 | $ | 3,850,000 | $ | 3,250,000 | |||
| Estimated costs to complete as of year-end | 6,390,000 | 3,150,000 | 0 | ||||||
In: Accounting
In 2018, the Westgate Construction Company entered into a contract to construct a road for Santa Clara County for $10,000,000. The road was completed in 2020. Information related to the contract is as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,610,000 | $ | 3,162,000 | $ | 2,230,800 | |||
| Estimated costs to complete as of year-end | 6,390,000 | 2,028,000 | 0 | ||||||
| Billings during the year | 2,100,000 | 3,672,000 | 4,228,000 | ||||||
| Cash collections during the year | 1,850,000 | 3,000,000 | 5,150,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
5. Calculate the amount of revenue and gross
profit (loss) to be recognized in each of the three years assuming
the following costs incurred and costs to complete information.
(Do not round intermediate calculations and round your
final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.)
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,610,000 | $ | 3,850,000 | $ | 4,050,000 | |||
| Estimated costs to complete as of year-end | 6,390,000 | 4,200,000 | 0 | ||||||
In: Accounting
Required information
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,156,000 | $ | 3,388,000 | $ | 2,371,600 | |||
| Estimated costs to complete as of year-end | 5,544,000 | 2,156,000 | 0 | ||||||
| Billings during the year | 2,130,000 | 3,414,000 | 4,456,000 | ||||||
| Cash collections during the year | 1,865,000 | 3,300,000 | 4,835,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
5. Calculate the amount of revenue and gross
profit (loss) to be recognized in each of the three years assuming
the following costs incurred and costs to complete information.
(Do not round intermediate calculations and round your
final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.)
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,156,000 | $ | 3,865,000 | $ | 4,095,000 | |||
| Estimated costs to complete as of year-end | 5,544,000 | 4,230,000 | 0 | ||||||
In: Accounting
Required information
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,156,000 | $ | 3,388,000 | $ | 2,371,600 | |||
| Estimated costs to complete as of year-end | 5,544,000 | 2,156,000 | 0 | ||||||
| Billings during the year | 2,130,000 | 3,414,000 | 4,456,000 | ||||||
| Cash collections during the year | 1,865,000 | 3,300,000 | 4,835,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
4. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign.)
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,156,000 | $ | 3,865,000 | $ | 3,265,000 | |||
| Estimated costs to complete as of year-end | 5,544,000 | 3,165,000 | 0 | ||||||
In: Accounting
In 2018, the Westgate Construction Company entered into a
contract to construct a road for Santa Clara County for
$10,000,000. The road was completed in 2020. Information related to
the contract is as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,580,000 | $ | 4,042,000 | $ | 2,175,800 | |||
| Estimated costs to complete as of year-end | 6,020,000 | 1,978,000 | 0 | ||||||
| Billings during the year | 2,060,000 | 4,562,000 | 3,378,000 | ||||||
| Cash collections during the year | 1,830,000 | 4,200,000 | 3,970,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
5. Calculate the amount of revenue and gross
profit (loss) to be recognized in each of the three years assuming
the following costs incurred and costs to complete information.
(Do not round intermediate calculations and round your
final answers to the nearest whole dollar amount. Loss amounts
should be indicated with a minus sign.)
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,580,000 | $ | 3,830,000 | $ | 3,990,000 | |||
| Estimated costs to complete as of year-end | 6,020,000 | 4,160,000 | 0 | ||||||
In: Accounting
Pharoah Company’s comparative balance sheets are presented
below:
Pharoah Company
Comparative Balance Sheets
December 31
2020
2019
Cash
$ 17,000
$ 17,500
Accounts receivable
25,000
22,400
Investments
19,850
16,050
Equipment
60,050
69,750
Accumulated depreciation—equipment
(13,750
)
(10,400
)
Total
$108,150
$115,300
Accounts payable
$ 14,750
$ 11,250
Bonds payable
10,400
30,000
Common stock
49,500
45,200
Retained earnings
33,500
28,850
Total
$108,150
$115,300
Additional information:
1.Net income was $18,450. Dividends declared and paid were $13,800.
2.Equipment which cost $9,700 and had accumulated depreciation of $1,700 was sold for $3,300.
3.No noncash investing and financing activities occurred during 2020
Prepare a statement of cash flows for 2020 using the indirect method.
Compute free cash flow. (Enter negative amount using
either a negative sign preceding the number e.g. -45 or parentheses
e.g. (45).)
| Free cash flow |
In: Accounting
In 2018, the Westgate Construction Company entered into a
contract to construct a road for Santa Clara County for
$10,000,000. The road was completed in 2020. Information related to
the contract is as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,072,000 | $ | 2,738,000 | $ | 2,849,000 | |||
| Estimated costs to complete as of year-end | 5,328,000 | 2,590,000 | 0 | ||||||
| Billings during the year | 2,160,000 | 2,650,000 | 5,190,000 | ||||||
| Cash collections during the year | 1,880,000 | 2,700,000 | 5,420,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
rev: 09_15_2017_QC_CS-99734
4. Calculate the amount of revenue and gross profit (loss) to be recognized in each of the three years assuming the following costs incurred and costs to complete information. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Loss amounts should be indicated with a minus sign.)
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,072,000 | $ | 3,880,000 | $ | 3,280,000 | |||
| Estimated costs to complete as of year-end | 5,328,000 | 3,180,000 | 0 | ||||||
In: Accounting
The following information applies to the questions displayed
below.]
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,184,000 | $ | 3,510,000 | $ | 2,316,600 | |||
| Estimated costs to complete as of year-end | 5,616,000 | 2,106,000 | 0 | ||||||
| Billings during the year | 2,120,000 | 3,574,000 | 4,306,000 | ||||||
| Cash collections during the year | 1,860,000 | 3,400,000 | 4,740,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
rev: 09_15_2017_QC_CS-99734
2-a. In the journal below, complete the
necessary journal entries for the year 2018 (credit "Various
accounts" for construction costs incurred).
2-b. In the journal below, complete the necessary
journal entries for the year 2019 (credit "Various accounts" for
construction costs incurred).
2-c. In the journal below, complete the necessary
journal entries for the year 2020 (credit "Various accounts" for
construction costs incurred).
In: Accounting
Whispering Ltd. sold $6,830,000 of 8% bonds, which were dated March 1, 2020, on June 1, 2020. The bonds paid interest on September 1 and March 1 of each year. The bonds' maturity date was March 1, 2030, and the bonds were issued to yield 10%. Whispering's fiscal year-end was February 28, and the company followed IFRS. On June 1, 2021, Whispering bought back $2,830,000 worth of bonds for $2,730,000 plus accrued interest.
a,Using 1. a financial calculator, or 2. Excel function PV, calculate the issue price of the bonds and prepare the entry for the issuance of the bonds. (Hint: Use the account Interest Payable in your entry).
b,Prepare the journal entry for the scheduled interest payment on September 1, 2020
c,Prepare any year-end entry required at February 28, 2021
d,Prepare the entry required for the redemption of face value $2,830,000 of the bonds on June 1, 2021.
In: Accounting