Questions
Data from 2010 & 2011, in millions (source: Billboard Magazine): Company            Annual Revenue Market Valuation Spotify            

Data from 2010 & 2011, in millions (source: Billboard Magazine):

Company            Annual Revenue Market Valuation

Spotify                145 3,000

Warner Music     2,888                   3,300

Live Nation         5,600                   1,700

Pandora 241 1,300

EMI                    1,800                   1,900

3a) Find the correlation between annual revenue and market valuation. Is it statistically significant?

3b) Why is the correlation between revenue and market valuation so low?.

In: Statistics and Probability

1. Of the following adjusting entries, which one results in a decrease in liabilities and the...

1. Of the following adjusting entries, which one results in a decrease in liabilities and the recognition of a revenue at the end of an accounting period?
A. The entry to record interest accrued on a note payable.
B. The entry to record interest accrued on a note receivable.
C. The entry to record the earned portion of rent previously received in advance from a tenant and recorded in a real account.
D. The entry to write off a portion of prepaid insurance used in the accounting period and originally recorded in a real account.
E. None of the above.
2. Liam Corporation, which maintains its accounts on the basis of a fiscal year ending December 31, began the active management of an office building on December 1, 2012 for an agreed monthly fee of $60,000. The first cash collection was due on January 3, 2013. The adjusting entry required at December 31, 2012 would be:
A. A debit to Rental Commissions Receivable for $60,000 and a credit to Rental Commissions Revenue for $60,000.
B. A $60,000 debit to Unearned Rental Commissions and a $60,000 credit to Rental Commissions Revenue.
C. A debit to Cash for $60,000 and a credit to Rental Commissions Revenue for $60,000.
D. A debit to Cash for $60,000 and a credit to Unearned Rental Commissions for $60,000.
E. None of the above.
3. The accountant for the Herb Company forgot to make an adjusting entry to record accrued salaries owed employees at the end of the year. The wages will be paid in the next year. The effect of this error would be:
A. An overstatement of assets and of net income offset by an understatement of owner’s equity.
B. An overstatement of net income and an understatement of assets.
C. An understatement of assets, net income, and owner’s equity.
D. An overstatement of liabilities offset by an understatement of owner’s equity.
E. None of the above.

4. Sophie Company made several purchases of office supplies totaling $11,200 during its first year of operations and recorded all purchases by debiting a temporary account. At December 31, the amount of unused supplies on hand was determined by count to amount to $3,600. The proper adjusting entry would be:
A. Debit Office Supplies Expense $3,600 and credit Office Supplies $3,600.
B. Debit Accounts Payable $3,600 and credit Office Supplies $3,600.
C. Debit Office Supplies $3,600 and credit Office Supplies Expense $3,600.
D. Debit Office Supplies Expense $7,600, and credit Office Supplies $7,600.
E. None of the above.
5. Willycom Company borrowed $80,000 from China Bank on September 2, 2012. Willycom signed a 180 day, 12% note payable to China Bank. On December 31, 2012, part of the adjusting entry should include:
A. Debit Interest Expense for $3,200.
B. Credit Interest Payable for $4,800.
C. Debit Interest Expense for $9,600.
D. Credit Note Payable for $80,000.
None of the above


Use the following information to answer questions the next 2 questions:
On December 31, 2012, Lauren Company prepared year-end financial statements. Lauren failed to record any of the following necessary adjusting entries. What would be the effect of failing to record each of the following necessary, but unrecorded, adjusting journal entries on Lauren Company’s year-end financial statements?
6. Lauren Co. failed to correctly record the amount of insurance that had expired at the end of the year; it had originally recorded the cost of the insurance by a debit to Prepaid Insurance.
A. Total assets are understated.
B. Total liabilities are overstated.
C. Total owners’ equity is overstated.
D. Net income is understated.
E. None of the above
7. Lauren Co. failed to correctly record the amounts owed to them by its customers for services performed but not yet paid to Lauren Co. by the end of the year.
A. Total assets are overstated.
B. Total liabilities are understated.
C. Total owners’ equity is overstated.
D. Net income is overstated.
E. None of the above

In: Accounting

1. Of the following adjusting entries, which one results in a decrease in liabilities and the...

1. Of the following adjusting entries, which one results in a decrease in liabilities and the recognition of a revenue at the end of an accounting period?
A. The entry to record interest accrued on a note payable.
B. The entry to record interest accrued on a note receivable.
C. The entry to record the earned portion of rent previously received in advance from a tenant and recorded in a real account.
D. The entry to write off a portion of prepaid insurance used in the accounting period and originally recorded in a real account.
E. None of the above.
2. Liam Corporation, which maintains its accounts on the basis of a fiscal year ending December 31, began the active management of an office building on December 1, 2012 for an agreed monthly fee of $60,000. The first cash collection was due on January 3, 2013. The adjusting entry required at December 31, 2012 would be:
A. A debit to Rental Commissions Receivable for $60,000 and a credit to Rental Commissions Revenue for $60,000.
B. A $60,000 debit to Unearned Rental Commissions and a $60,000 credit to Rental Commissions Revenue.
C. A debit to Cash for $60,000 and a credit to Rental Commissions Revenue for $60,000.
D. A debit to Cash for $60,000 and a credit to Unearned Rental Commissions for $60,000.
E. None of the above.
3. The accountant for the Herb Company forgot to make an adjusting entry to record accrued salaries owed employees at the end of the year. The wages will be paid in the next year. The effect of this error would be:
A. An overstatement of assets and of net income offset by an understatement of owner’s equity.
B. An overstatement of net income and an understatement of assets.
C. An understatement of assets, net income, and owner’s equity.
D. An overstatement of liabilities offset by an understatement of owner’s equity.
E. None of the above.

4. Sophie Company made several purchases of office supplies totaling $11,200 during its first year of operations and recorded all purchases by debiting a temporary account. At December 31, the amount of unused supplies on hand was determined by count to amount to $3,600. The proper adjusting entry would be:
A. Debit Office Supplies Expense $3,600 and credit Office Supplies $3,600.
B. Debit Accounts Payable $3,600 and credit Office Supplies $3,600.
C. Debit Office Supplies $3,600 and credit Office Supplies Expense $3,600.
D. Debit Office Supplies Expense $7,600, and credit Office Supplies $7,600.
E. None of the above.
5. Willycom Company borrowed $80,000 from China Bank on September 2, 2012. Willycom signed a 180 day, 12% note payable to China Bank. On December 31, 2012, part of the adjusting entry should include:
A. Debit Interest Expense for $3,200.
B. Credit Interest Payable for $4,800.
C. Debit Interest Expense for $9,600.
D. Credit Note Payable for $80,000.
E. None of the above.
Use the following information to answer questions the next 2 questions:
On December 31, 2012, Lauren Company prepared year-end financial statements. Lauren failed to record any of the following necessary adjusting entries. What would be the effect of failing to record each of the following necessary, but unrecorded, adjusting journal entries on Lauren Company’s year-end financial statements?
6. Lauren Co. failed to correctly record the amount of insurance that had expired at the end of the year; it had originally recorded the cost of the insurance by a debit to Prepaid Insurance.
A. Total assets are understated.
B. Total liabilities are overstated.
C. Total owners’ equity is overstated.
D. Net income is understated.
E. None of the above
7. Lauren Co. failed to correctly record the amounts owed to them by its customers for services performed but not yet paid to Lauren Co. by the end of the year.
A. Total assets are overstated.
B. Total liabilities are understated.
C. Total owners’ equity is overstated.
D. Net income is overstated.
E. None of the above

In: Accounting

Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This...

Comparative financial statements for Weaver Company follow:

Weaver Company
Comparative Balance Sheet
at December 31
This Year Last Year
Assets
Cash $ 5 $ 12
Accounts receivable 309 230
Inventory 156 196
Prepaid expenses 8 6
Total current assets 478 444
Property, plant, and equipment 510 430
Less accumulated depreciation (85 ) (72 )
Net property, plant, and equipment 425 358
Long-term investments 28 35
Total assets $ 931 $ 837
Liabilities and Stockholders' Equity
Accounts payable $ 302 $ 226
Accrued liabilities 72 79
Income taxes payable 74 64
Total current liabilities 448 369
Bonds payable 200 172
Total liabilities 648 541
Common stock 163 200
Retained earnings 120 96
Total stockholders’ equity 283 296
Total liabilities and stockholders' equity $ 931 $ 837
Weaver Company
Income Statement
For This Year Ended December 31
Sales $ 754
Cost of goods sold 450
Gross margin 304
Selling and administrative expenses 223
Net operating income 81
Nonoperating items:
Gain on sale of investments $ 6
Loss on sale of equipment (3 ) 3
Income before taxes 84
Income taxes 23
Net income $ 61

During this year, Weaver sold some equipment for $18 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $7 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $37 of its own stock. This year Weaver did not retire any bonds.

Required:

1. Using the indirect method, determine the net cash provided by/used in operating activities for this year. (List any deduction in cash and cash outflows as negative amounts.)

Required information

[The following information applies to the questions displayed below.]

Comparative financial statements for Weaver Company follow:

Weaver Company
Comparative Balance Sheet
at December 31
This Year Last Year
Assets
Cash $ 5 $ 12
Accounts receivable 309 230
Inventory 156 196
Prepaid expenses 8 6
Total current assets 478 444
Property, plant, and equipment 510 430
Less accumulated depreciation (85 ) (72 )
Net property, plant, and equipment 425 358
Long-term investments 28 35
Total assets $ 931 $ 837
Liabilities and Stockholders' Equity
Accounts payable $ 302 $ 226
Accrued liabilities 72 79
Income taxes payable 74 64
Total current liabilities 448 369
Bonds payable 200 172
Total liabilities 648 541
Common stock 163 200
Retained earnings 120 96
Total stockholders’ equity 283 296
Total liabilities and stockholders' equity $ 931 $ 837
Weaver Company
Income Statement
For This Year Ended December 31
Sales $ 754
Cost of goods sold 450
Gross margin 304
Selling and administrative expenses 223
Net operating income 81
Nonoperating items:
Gain on sale of investments $ 6
Loss on sale of equipment (3 ) 3
Income before taxes 84
Income taxes 23
Net income $ 61

During this year, Weaver sold some equipment for $18 that had cost $31 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $13 that had cost $7 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $37 of its own stock. This year Weaver did not retire any bonds.

Weaver Company
Statement of Cash Flows—Indirect Method (partial)
0
$0
Weaver Company
Statement of Cash Flows
For This Year Ended December 31
Operating activities:
Investing activities:
0
Financing activities:
0
0
Beginning cash and cash equivalents
Ending cash and cash equivalents $0

In: Accounting

Use the distribution in the form of the stem-leaf plot. Stem      Leaves 1                 1478 2        &nbs

Use the distribution in the form of the stem-leaf plot.

Stem      Leaves

1                 1478

2              01237888

3                  189          


16/ The mid-point of the third class is

A./   32   B/   36 C/    34.5 D/   35

17/ The median is

A./   24 B/  23 C/ 25   D/ 5

18/ The relative frequency for the third class is:

A./   20%   B/  50% C/    66% D/   40%

19/ The heights of a group of professional basketball players are summarized in the frequency distribution below. Find the mean height from this frequency table.

Height s (in)           Frequency

70-72                            4

73-75                            6

76-78                            8

79-81                            2


A./   75.2 in   B/  76.8 in C/    74.0 in D/   77.5 in

20/ The temperatures ( in ºF ) in a room is recorded at the top of hours are

67, 68, 70 , 5, 77, 77, 78, 80, 78, 79, 74, 74. Choose best answer:

a/  It is a typo

b/  highest temperature is probably 95

c/  5 is not an outlier

d/  5 is an outlier


21/ The variance of 6 washing machines with prices:  $ 800, $784, $ 1,235, $860, $1,036 and $770 is


A/ 196.4 B/   34,295.3 C/ 26,002.7 D/ 185.2


22/ The coefficient of variation ( round to closest %) for the set of data  :

1, 3, 3, 5, 5, 6, 7, 8, 9 ,12, 15, 24  is


A   74% B/ 67% C/ 24% D/ 78 %

23/ Human body temperatures have the mean of 98.2º  and a standard deviation of 0.6º.

Amy’s temperature can be described by z = 0.9. What is her temperature?

A/ 98.2º B/ 97.8º C/   98.7º D/ 99.3º


24/ The upper bound for the outlier for the data set

-11, 14, 22, 22, 22, 23, 31, 31, 42, 44, 44, 75    is


A/  74.5 B/  75 C/ 84 D/   68

  

25/ The box-plot of a data with 5- point summary   2, 6, 8, 11, 18

A/is positive skewed. B/ is negative skewed.

C/ is symmetric D/ perfect skewed

In: Math

1. On October 1, BSS placed an order for 100 golf shirts at a unit cost...

1.

On October 1, BSS placed an order for 100 golf shirts at a unit cost of $21, under terms 2/10, n/30. Record the place of the order for golf shirts.
2.

The order placed on October 1 was received by BSS on October 10, but 10 golf shirts had been damaged in shipment. Record the inventory purchased on account.
3.

On October 11, the 10 damaged golf shirts were returned. Record the return of the damaged inventory.
4.

On October 12, BSS complained that the remaining golf shirts were slightly defective so the supplier grated a $290 allowance. Record the allowance received for the defective inventory purchased.
5.

On October 13, BSS paid for the golf shirts. Record the payment in full.
6.

During the first week of October BSS received student and faculty orders for 90 golf shirts, at a unit price of $39.00, on terms 2/10, n/30. The golf shirts were delivered to the customers on October 18. Record the sales revenue on account for the order.
7.

During the first week of October BSS received student and faculty orders for 90 golf shirts, at a unit price of $39.00, on terms 2/10, n/30. The golf shirts were delivered to the customers on October 18. Record the cost of goods sold for the order.
8.

Customers were unhappy with the golf shirts, so BSS permitted them to be returned or gave an allowance of $9.00 per shirt. On October 21, one-half of the golf shirts were returned by customers. Record the return of the unsatisfactory merchandise sold on account.
9.

Customers were unhappy with the golf shirts, so BSS permitted them to be returned or gave an allowance of $9.00 per shirt. On October 21, one-half of the golf shirts were returned by customers. Record the cost of goods returned.
10.

Customers were unhappy with the golf shirts, so BSS permitted them to be returned or gave an allowance of $9.00 per shirt. On October 22, the remaining 45 customers were granted the allowance. Record the allowance granted for the defective inventory sold on account.
11.

On October 25, the customers paid their remaining balances due on account. Record the customers' payments in full.
12.

As of October 31, the payment of inventory ordered in full dated October 13 had not yet cleared the bank. Record the Otober 13 check that had not yet cleared the bank.

value:
1.33 points

Required information

C6-1 Part 1

Required:
1b.

Prepare journal entries for the transactions described above, using the date of each transaction as its reference. Assume BSS uses perpetual inventory accounts. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

1a.

Report the financial effects of the above transactions in a multistep income statement for the month ended October 31 prepared for internal use. Assume operating expenses, other than cost of goods sold, are $100 and income tax expense is $135.

In: Accounting

Please, I need correct answers. Thank you, Short Answers 1-Why does it matter how and when...

Please, I need correct answers. Thank you,

Short Answers

1-Why does it matter how and when a company recognizes revenue?

2-Why is determining when to recognize revenue more difficult under accrual accounting vs. cash accounting?

In: Accounting

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for...

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company's fiscal year-end. The 2017 balance sheet disclosed the following: 


Current assets: 

   Receivables, net of allowance for uncollectible accounts of $34,000 $ 452,000 


During 2018, credit sales were $1,770,000, cash collections from customers $1,850,000, and $39,000 in accounts receivable were written off. In addition, $3,400 was collected from a customer whose account was written off in 2017. An aging of accounts receivable at December 31, 2018, reveals the following: 

Age GroupPercentage of Year-End Receivables in GroupPercent Uncollectible
0-60 days60%3%
61-90 days105
91-120 days2025
Over 120 days1045

2. Prepare the year-end adjusting entry for bad debts according to each of the following situations: 

a. Bad debt expense is estimated to be 2% of credit sales for the year. 

b. Bad debt expense is estimated by computing net realizable value of the receivables. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable. 

c. Bad debt expense is estimated by computing net realizable value of the receivables. The allowance for uncollectible accounts is determined by an aging of accounts receivable. 

3. For situations (a)–(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2018 balance sheet?


In: Accounting

Raintree Cosmetic Company sells its products to customers on acredit basis. An adjusting entry for...

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company’s fiscal year-end. The 2020 balance sheet disclosed the following: 


Current assets: 

   Receivables, net of allowance for uncollectible accounts of $46,000 $ 512,000 


During 2021, credit sales were $1,830,000, cash collections from customers $1,910,000, and $55,000 in accounts receivable were written off. In addition, $4,600 was collected from a customer whose account was written off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following: 

Percentage of Year-End Percent Age Group Receivables in Group Uncollectible 0−60 days 60 % 3 % 61−90 days 10 5 91−120 days 20 25 Over 120 days 10 45 


Required:

 1. Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previously written off.

 2. Prepare the year-end adjusting entry for bad debts according to each of the following situations: Bad debt expense is estimated to be 2% of credit sales for the year. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is determined by an aging of accounts receivable.

 3. For situations (a)−(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balance sheet?

In: Accounting

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for...

Raintree Cosmetic Company sells its products to customers on a credit basis. An adjusting entry for bad debt expense is recorded only at December 31, the company’s fiscal year-end. The 2020 balance sheet disclosed the following:

Current assets:

Receivables, net of allowance for uncollectible accounts of $30,000

$432,000

During 2021, credit sales were $1,750,000, cash collections from customers $1,830,000, and $35,000 in accounts receivable were written off. In addition, $3,000 was collected from a customer whose account was written off in 2020. An aging of accounts receivable at December 31, 2021, reveals the following:

Age Group

Percentage of Year-End
Receivables in Group

Percent
Uncollectible

0–60 days

65%

4%

61–90 days

20

15

91–120 days

10

25

Over 120 days

  5

40

Required:

  1. Prepare summary journal entries to account for the 2021 write-offs and the collection of the receivable previously written off.
  2. Prepare the year-end adjusting entry for bad debts according to each of the following situations:
    1. Bad debt expense is estimated to be 3% of credit sales for the year.
    2. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is estimated to be 10% of the year-end balance in accounts receivable.
    3. Bad debt expense is estimated by adjusting the allowance for uncollectible accounts to the balance that reduces the carrying value of accounts receivable to the amount of cash expected to be collected. The allowance for uncollectible accounts is determined by an aging of accounts receivable.
  3. For situations (a)–(c) in requirement 2 above, what would be the net amount of accounts receivable reported in the 2021 balance sheet?

In: Accounting