Samah Nylon Company is a manufacturer and seller of Tennis Rackets.  Information on budgeted sales in units is given below. Use this information to answer all parts of question one.

                     Month                                        Units

February 2018                                    30,000

March 2018                                         34,000

April 2018                                           52,000

May 2018                                            57,000

June 2018                                            65,000

July 2018                                            40,000

Aug 2018                                            60,000                                    

Required:                    

The selling price per unit is AED 40.

All sales are on account. Based on past experience, sales are collected in the following pattern:

The company maintains finished goods inventories equal to 28% of the following month's sales. The ending inventory on 31^stMarch was 10,500 units.

Each Racket requires 5 pounds of raw materials.

The company requires that the ending inventory of raw materials be equal to 30% of the following month's production needs. The beginning inventory of materials on April 1^stwas 64,875 units

The raw materials costs $1.40 per pound.

60% of a month's purchases of raw materials is paid for in the month of purchase; the remainder is paid for in the following month.  The accounts payable balance at the end of March was AED 44,604 to be paid in full in April.

Required:

Prepare a sales budget, by month and in total, for the second quarter. (Show your budget in both units and dollars.)

Prepare a schedule of expected cash collections, by month and in total, for the second quarter.

Prepare a production budget for each of the months of April-July.

Prepare a direct materials budget, by month and in total, for the second quarter.

Prepare a schedule of expected cash disbursements, by month and in total, for the second quarter.

Belden, Inc. acquires 30 percent of the outstanding voting shares of Sheffield, Inc. on January 1, 2017, for $306,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $784,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's excess cost over book value in its 30 percent purchase. The copyright had a remaining life of 16 years at January 1, 2017. No goodwill resulted from Belden's share purchase. Sheffield reported net income of $172,000 in 2017 and $250,000 of net income during 2018. Dividends of $96,000 and $92,000 are declared and paid in 2017 and 2018, respectively. Belden uses the equity method. On its 2018 comparative income statements, how much income would Belden report for 2017 and 2018 in connection with the company's investment in Sheffield? If Belden sells its entire investment in Sheffield on January 1, 2019, for $432,000 cash, what is the impact on Belden's income? Assume that Belden sells inventory to Sheffield during 2017 and 2018 as follows.

What amount of equity income should Belden recognize for the year 2018? Year Cost to Belden Price to Sheffield Year-End Balance (at Transfer Price) 2017 $32,240 $52,000 $20,000 (sold in following year) 2018 34,220 59,000 40,000 (sold in following year)

Please answer the following question,

Vanstone Corp., a public company, adopted a stock option plan on November 30, 2017, that designated 70,000 common shares as available for the granting of options to officers of the corporation at an exercise price of $8 a share. The market value was $12 a share on November 30, 2017.

On January 2, 2018, options to purchase 28,000 shares were granted to President Don Pedro: 15,000 for services to be rendered in 2018, and 13,000 for services to be rendered in 2019. Also on that date, options to purchase 14,000 shares were granted to Vice-President Beatrice Leonato: 7,000 for services to be rendered in 2018, and 7,000 for services to be rendered in 2019. The shares' market value was $14 a share on January 2, 2018. The options were exercisable for a period of one year following the year in which the services were rendered. On January 2, 2018, the value of the options was estimated at $400,000.

In 2019, neither the president nor the vice-president exercised their options because the shares' market price was below the exercise price. The shares' market value was $7 a share on December 31, 2019, when the options for 2018 services lapsed.

On December 31, 2020, both the president and vice-president exercised their options for 13,000 and 7,000 shares, respectively, when the market price was $16 a share. The company's year-end is December 31.

Instructions

1) Prepare the necessary journal entries in 2017 when the stock option plan was adopted, in 2018 when the options were granted, in 2019 when the options lapsed, and in 2020 when the options were exercised.

Bonny Corp. has a defined benefit pension plan for its employees who have an average remaining service life of 10 years. The following information is available for 2016 and 2017 related to the pension plan:

Bonny Corp. had no beginning balance in its AOCI—net actuarial (gain) loss on January 1, 2017. The actuarial (gains) losses on PBO arose due to changes in assumptions made by the actuaries regarding salary increases (2017) and mortality estimates (2018).

Required:

Compute Bonny’s PBO at December 31, 2017, and December 31, 2018.

Compute the fair value of plan assets at December 31, 2017, and December 31, 2018.

Compute the funded status of the plan at December 31, 2017, and December 31, 2018.

Compute the year-end balance in AOCI—net actuarial loss (gain) for Bonny Corp. for 2017 and 2018.

Compute OCI for the years ended December 31, 2017, and December 31, 2018.

(For parts 3, 4 and 5, liabilities and losses should be indicated by a minus sign.)

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:

1. On December 10, a customer balance of $1,750 from a prior year was determined to be uncollectible, so it was written off.
2. On December 31, a decision was made to continue the accounting policy of basing estimated bad debt losses on 2 percent of credit sales for the year.

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.

2. b. Show how the amounts related to Accounts Receivable would be reported on the balance sheet?

3. On the basis of the data available, does the 2 percent rate appear to be reasonable?

Fuzzy Monkey Technologies, Inc., purchased as a short-term investment $60 million of 6% bonds, dated January 1, on January 1, 2018. Management intends to include the investment in a short-term, active trading portfolio. For bonds of similar risk and maturity the market yield was 8%. The price paid for the bonds was $46 million. Interest is received semiannually on June 30 and December 31. Due to changing market conditions, the fair value of the bonds at December 31, 2016, was $50 million.

Required: 1.Prepare the relevant journal entries on the respective dates (record the interest at the effective rate). (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations. Enter your answers in millions rounded to 2 decimal places, (i.e., 5,500,000 should be entered as 5.50).)

a. Record Fuzzy Monkey’s investment on bonds on January 1, 2018.

b. Record the interest revenue on June 30, 2018.

c. Record the interest revenue on December 31, 2018

2. At what amount will Fuzzy Monkey report its investment in the December 31, 2018, balance sheet?

3. Prepare any entry necessary to achieve this reporting objective.

a. Record any necessary entry to report the investment at the correct value on the balance sheet. For December 31, 2018

4. How would Fuzzy Monkey's 2018 statement of cash flows be affected by this investment?

a. Operating cash flow

b. Investing Cash flow

Belden, Inc. acquires 30 percent of the outstanding voting shares of Sheffield, Inc. on January 1, 2017, for $320,000, which gives Belden the ability to significantly influence Sheffield. Sheffield has a net book value of $804,000 at January 1, 2017. Sheffield's asset and liability accounts showed carrying amounts considered equal to fair values except for a copyright whose value accounted for Belden's excess cost over book value in its 30 percent purchase. The copyright had a remaining life of 16 years at January 1, 2017. No goodwill resulted from Belden's share purchase.

Sheffield reported net income of $178,000 in 2017 and $250,000 of net income during 2018. Dividends of $76,000 and $96,000 are declared and paid in 2017 and 2018, respectively. Belden uses the equity method.

1. On its 2018 comparative income statements, how much income would Belden report for 2017 and 2018 in connection with the company's investment in Sheffield?

2. If Belden sells its entire investment in Sheffield on January 1, 2019, for $414,000 cash, what is the impact on Belden's income?

3. Assume that Belden sells inventory to Sheffield during 2017 and 2018 as follows. What amount of equity income should Belden recognize for the year 2018?

The plant asset and accumulated depreciation accounts of Pell Corporation had the following balances at December 31, 2017:

Transactions during 2018 were as follows:

1. On January 2, 2018, machinery and equipment were purchased at a total invoice cost of $345,000, which included a $7,200 charge for freight. Installation costs of $44,000 were incurred.
2. On March 31, 2018, a small storage building was donated to the company. The person donating the building originally purchased it three years ago for $36,000. The fair value of the building on the day of the donation was $23,000.
3. On May 1, 2018, expenditures of $67,000 were made to repave parking lots at Pell’s plant location. The work was necessitated by damage caused by severe winter weather.
4. On November 1, 2018, Pell acquired a tract of land with an existing building in exchange for 10,000 shares of Pell's common stock that had a market price of $39 per share. Pell paid legal fees and title insurance totaling $40,000. Shortly after acquisition, the building was razed at a cost of $52,000 in anticipation of new building construction in 2019.
5. On December 31, 2018, Pell purchased a small storage building by giving $16,950 cash and an old automobile purchased for $26,500 in 2014. Depreciation on the old automobile recorded through December 31, 2018, totaled $15,200. The fair value of the old automobile was $5,450.

Excerpts from Dowling Company's December 31, 2018 and 2017, financial statements and key ratios are presented below (all numbers are in millions):

Dowling's return on equity for 2018 is (rounded):