During 2020, Martinez Company started a construction job with a contract price of $1,610,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$405,900 | $766,500 | $1,076,000 | |||
|
Estimated costs to complete |
584,100 | 328,500 | –0– | |||
|
Billings to date |
300,000 | 893,000 | 1,610,000 | |||
|
Collections to date |
267,000 | 809,000 | 1,435,000 |
Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
|
Gross profit recognized in 2020 |
$enter a dollar amount |
|
|---|---|---|
|
Gross profit recognized in 2021 |
$enter a dollar amount |
|
|
Gross profit recognized in 2022 |
$enter a dollar amount |
List of Accounts
Question Part Score
--/3
Prepare all necessary journal entries for 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. For costs incurred use account Materials, Cash, Payables.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
(To record cost of construction.) |
||
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
(To record progress billings.) |
||
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
(To record collections.) |
||
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
(To recognize revenue.) |
List of Accounts
Question Part Score
--/9
Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Gross profit |
$enter a dollar amount |
$enter a dollar amount |
$enter a dollar amount |
In: Accounting
Time Warner Cable Case Study, Memo #4 . Please see below especially the first two questions in bold
1] If we lower the price, do you think this is likely to lead to higher revenue?
2}how much potential revenue can we generate and how low should we go with our price?
Time Warner Cable Case Study, Memo #4 . As you are aware, we recently added the EPIX Movie Channels as part of a new tier of programming for our digital video subscribers. The EPIX channels are sold as an add on package for $9.75 per month, but we would like to potentially increase our contribution margin from our subscriber base. Currently we have 15,059 subscribers, generating monthly revenue of $146,823. In an earlier study, our marketing department generated data on sales quantities at various price levels. In addition, we have included the licensing cost as well as regional expenses. Please provide a recommendation of the profit-maximizing price, and the how much our profits will increase if we adjust price to the recommended level. Also please note whether this will impact our revenue. Build a regression and find the most significant model. Calculate elasticity. Find maximizing price level.
|
In: Economics
To determine how much money you have to invest, add up the investment for the 4 projects. Multiple this total by 80% to get how much money your company has to spend. Choose the best combination of projects for the company to invest in. Show one break even analysis.
Total Investment = $198420.19
Projects:
#1
Invest $60000 in a 3D Printer
Training and installation $10000
Revenue per year $18000
Cost per year $3000
Market Value year 11 $30000
#2
Invest 42276 Euros in a Flow Jet Cutter
Installation $8000
Revenue per year $14000
Cost per year $4000
Market Value year 11 $15000
#3
Invest $40000 bar coding system
Setup, training $10000
Labor savings 1st year $15000 +3%/year
Cost per year $2500
Market Value year 11 $14000
#4
Invest $88000 in an Engineering software simulation tool
Training $12000
Revenue per year $27000
Cost per year $5000
Market Value year 11 $25000
#5
Invest 20325 Euros in a conveyor
Install $5000
Savings 1st year $11000, plus 3%/year
Cost per year $4000
Market Value year 11 $25000
#6
Invest $53000 in an automated inspection tool
Calibration, setup $12000
Savings 1st year $19000 plus 3%/year
Cost per year $5000
Market Value year 11 $25000
#7
Invest $82000 in packaging equipment
Installation $8000
Revenue 1st year $22000, + 4% per year
Cost per year $4500
Market Value year 11 $35000
#8
Invest 15477 Euros in automated paint box
Training $1000
Savings 1st year $7000 plus 3%/year
Cost per year $3500
Market Value year 11 $20500
From the Finance Department:
The following information is for all the projects:
11 Year life
MACRS GDS 7 year property
Federal Corporate Tax Rate = 21%
State Corporate Tax Rate = 6.3291%
Use current currency exchange rate as needed
Use inflation rates given
In: Finance
During 2020, Shamrock Company started a construction job with a contract price of $1,600,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$405,900 | $830,680 | $1,074,000 | |||
|
Estimated costs to complete |
584,100 | 262,320 | –0– | |||
|
Billings to date |
302,000 | 898,000 | 1,600,000 | |||
|
Collections to date |
272,000 | 818,000 | 1,420,000 |
Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
|
Gross profit recognized in 2020 |
$enter a dollar amount |
|
|---|---|---|
|
Gross profit recognized in 2021 |
$enter a dollar amount |
|
|
Gross profit recognized in 2022 |
$enter a dollar amount |
Prepare all necessary journal entries for 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. For costs incurred use account Materials, Cash, Payables.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
(To record cost of construction.) |
||
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
(To record progress billings.) |
||
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
(To record collections.) |
||
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
(To recognize revenue.) |
Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Gross profit |
$enter a dollar amount |
$enter a dollar amount |
$enter a dollar amount |
In: Accounting
Following are the 2019 income statements for Katy Com and Mike Com, competitors in the computer industry. Use these financial statements to answer the required.
|
Katy Com Income Statements |
|
(in millions) |
Sept. 24, 2019 |
Sept. 26, 2018 |
Sept. 27, 2017 |
|||
|
Net sales |
$215,639 |
$233,715 |
$182,795 |
|||
|
Cost of sales |
131,376 |
140,089 |
112,258 |
|||
|
Gross margin |
84,263 |
93,626 |
70,537 |
|||
|
Operating expenses |
||||||
|
Research and development |
10,045 |
8,067 |
6,041 |
|||
|
Selling, general and administrative |
14,194 |
14,329 |
11,993 |
|||
|
Total operating expenses |
24,239 |
22,396 |
18,034 |
|||
|
Operating income |
60,024 |
71,230 |
52,503 |
|||
|
Other income/(expense), net |
1,348 |
1,285 |
980 |
|||
|
Income before provision for income taxes |
61,372 |
72,515 |
53,483 |
|||
|
Provision for income taxes |
15,685 |
19,121 |
13,973 |
|||
|
Net income |
$ 45,687 |
$53,394 |
$39,510 |
|
Mike Com
Income Statements |
|
(in millions) |
June 30, 2019 |
June 30, 2018 |
June 30, 2017 |
|||
|
Revenue |
||||||
|
Product |
$61,502 |
$75,956 |
$72,948 |
|||
|
Service and other |
23,818 |
17,624 |
13,885 |
|||
|
Total revenue |
85,320 |
93,580 |
86,833 |
|||
|
Cost of revenue |
||||||
|
Product |
17,880 |
21,410 |
16,681 |
|||
|
Service and other |
14,900 |
11,628 |
10,397 |
|||
|
Total cost of revenue |
32,780 |
33,038 |
27,078 |
|||
|
Gross margin |
52,540 |
60,542 |
59,755 |
|||
|
Research and development |
11,988 |
12,046 |
11,381 |
|||
|
Sales and marketing |
14,697 |
15,713 |
15,811 |
|||
|
General and administrative |
4,563 |
4,611 |
4,677 |
|||
|
Impairment, integration, and restructuring |
1,110 |
10,011 |
127 |
|||
|
Operating income |
20,182 |
18,161 |
27,759 |
|||
|
Other income (expense), net |
(431 |
) |
346 |
61 |
||
|
Income before income taxes |
19,751 |
18,507 |
27,820 |
|||
|
Provision for income taxes |
2,953 |
6,314 |
5,746 |
|||
|
Net income |
$16,798 |
$12,193 |
$22,074 |
Required:
|
a. |
How do the two companies account for R&D expenditures? |
|
b. |
Katy’s and Mike's R&D expense includes many different types of costs. List three specific costs included in R&D expense on the income statement. |
|
c. |
Compare R&D expenses of the two companies. What trend do you notice in the R&D expenses of each company over time? (Hint: determine the common-size R&D amounts. Consider both direct R&D expenses as well as acquired R&D.) |
In: Accounting
During 2020, Blossom Company started a construction job with a contract price of $1,590,000. The job was completed in 2022. The following information is available.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Costs incurred to date |
$410,000 | $901,180 | $1,067,000 | |||
|
Estimated costs to complete |
590,000 | 197,820 | –0– | |||
|
Billings to date |
297,000 | 903,000 | 1,590,000 | |||
|
Collections to date |
271,000 | 805,000 | 1,434,000 |
Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used.
|
Gross profit recognized in 2020 |
$enter a dollar amount |
|
|---|---|---|
|
Gross profit recognized in 2021 |
$enter a dollar amount |
|
|
Gross profit recognized in 2022 |
$enter a dollar amount |
Prepare all necessary journal entries for 2021.
(Credit account titles are automatically indented when
amount is entered. Do not indent manually. If no entry is required,
select "No Entry" for the account titles and enter 0 for the
amounts. For costs incurred use account Materials, Cash,
Payables.)
|
Account Titles and Explanation |
Debit |
Credit |
|---|---|---|
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
enter an account title to record cost of construction |
enter a debit amount |
enter a credit amount |
|
(To record cost of construction.) |
||
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
enter an account title to record progress billings |
enter a debit amount |
enter a credit amount |
|
(To record progress billings.) |
||
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
enter an account title to record collections |
enter a debit amount |
enter a credit amount |
|
(To record collections.) |
||
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
enter an account title to recognize revenue |
enter a debit amount |
enter a credit amount |
|
(To recognize revenue.) |
Compute the amount of gross profit to be recognized each year,
assuming the completed-contract method is used.
|
2020 |
2021 |
2022 |
||||
|---|---|---|---|---|---|---|
|
Gross profit |
$enter a dollar amount |
$enter a dollar amount |
$enter a dollar amount |
In: Accounting
Required information
[The following information applies to the questions
displayed below.]
Washington County’s Board of Representatives is considering the construction of a longer runway at the county airport. Currently, the airport can handle only private aircraft and small commuter jets. A new, long runway would enable the airport to handle the midsize jets used on many domestic flights. Data pertinent to the board’s decision appear below.
| Cost of acquiring additional land for runway | $ | 75,000 | |
| Cost of runway construction | 355,000 | ||
| Cost of extending perimeter fence | 23,158 | ||
| Cost of runway lights | 40,000 | ||
| Annual cost of maintaining new runway | 20,000 | ||
| Annual incremental revenue from landing fees | 45,000 | ||
In addition to the preceding data, two other facts are relevant to the decision. First, a longer runway will require a new snowplow, which will cost $155,000. The old snowplow could be sold now for $15,500. The new, larger plow will cost $13,000 more in annual operating costs. Second, the County Board of Representatives believes that the proposed long runway, and the major jet service it will bring to the county, will increase economic activity in the community. The board projects that the increased economic activity will result in $66,000 per year in additional tax revenue for the county.
In analyzing the runway proposal, the board has decided to use a 10-year time horizon. The county’s hurdle rate for capital projects is 6 percent.
Use Appendix A for your reference. (Use appropriate factor(s) from the tables provided.)
In analyzing the runway proposal, the board has decided to use a 10-year time horizon. The county’s hurdle rate for capital projects is 6 percent. The County Board of Representatives believes that if the county conducts a promotional effort costing $35,500 per year, the proposed long runway will result in substantially greater economic development than was projected originally. However, the board is uncertain about the actual increase in county tax revenue that will result.
Required:
Suppose the board builds the long runway and conducts the promotional campaign. What would the increase in the county’s annual tax revenue need to be in order for the proposed runway’s internal rate of return to equal the county’s hurdle rate of 6 percent? (Round intermediate and final answer to the nearest dollar amount.)
In: Accounting
During 2020, Sage Company started a construction job with a contract price of $1,620,000. The job was completed in 2022. The following information is available. 2020 2021 2022 Costs incurred to date $444,400 $867,420 $1,060,000 Estimated costs to complete 565,600 230,580 –0– Billings to date 301,000 904,000 1,620,000 Collections to date 272,000 814,000 1,411,000 Compute the amount of gross profit to be recognized each year, assuming the percentage-of-completion method is used. Gross profit recognized in 2020 $enter a dollar amount 1060000 Gross profit recognized in 2021 $enter a dollar amount Gross profit recognized in 2022 $enter a dollar amount SHOW LIST OF ACCOUNTS Prepare all necessary journal entries for 2021. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. For costs incurred use account Materials, Cash, Payables.) Account Titles and Explanation Debit Credit enter an account title to record cost of construction enter a debit amount enter a credit amount enter an account title to record cost of construction enter a debit amount enter a credit amount (To record cost of construction.) enter an account title to record progress billings enter a debit amount enter a credit amount enter an account title to record progress billings enter a debit amount enter a credit amount (To record progress billings.) enter an account title to record collections enter a debit amount enter a credit amount enter an account title to record collections enter a debit amount enter a credit amount (To record collections.) enter an account title to recognize revenue enter a debit amount enter a credit amount enter an account title to recognize revenue enter a debit amount enter a credit amount enter an account title to recognize revenue enter a debit amount enter a credit amount (To recognize revenue.) SHOW LIST OF ACCOUNTS Compute the amount of gross profit to be recognized each year, assuming the completed-contract method is used. 2020 2021 2022 Gross profit $enter a dollar amount $enter a dollar amount
In: Accounting
Required information
[The following information applies to the questions
displayed below.]
In 2021, 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 2023. Information related to the contract is
as follows:
| 2021 | 2022 | 2023 | |||||||
| Cost incurred during the year | $ | 2,640,000 | $ | 2,300,000 | $ | 2,926,000 | |||
| Estimated costs to complete as of year-end | 6,160,000 | 2,660,000 | 0 | ||||||
| Billings during the year | 2,080,000 | 2,860,000 | 5,060,000 | ||||||
| Cash collections during the year | 1,840,000 | 2,800,000 | 5,360,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
Required:
1. Calculate the amount of revenue and gross
profit (loss) to be recognized in each of the three years.
(Do not round intermediate calculations. Loss amounts
should be indicated with a minus sign.)
2-a. In the journal below, complete the
necessary journal entries for the year 2021 (credit "Various
accounts" for construction costs incurred).
2-b. In the journal below, complete the necessary
journal entries for the year 2022 (credit "Various accounts" for
construction costs incurred).
2-c. In the journal below, complete the necessary
journal entries for the year 2023 (credit "Various accounts" for
construction costs incurred).
3. Complete the information required below to prepare a partial balance sheet for 2021 and 2022 showing any items related to the contract. (Do not round intermediate calculations.)
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.)
| 2021 | 2022 | 2023 | |||||||
| Costs incurred during the year | $ | 2,640,000 | $ | 3,840,000 | $ | 3,240,000 | |||
| Estimated costs to complete as of year-end | 6,160,000 | 3,140,000 | 0 | ||||||
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.)
| 2021 | 2022 | 2023 | |||||||
| Costs incurred during the year | $ | 2,640,000 | $ | 3,840,000 | $ | 4,020,000 | |||
| Estimated costs to complete as of year-end | 6,160,000 | 4,180,000 | 0 | ||||||
In: Accounting
In 2021, 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 2023. Information related to
the contract is as follows:
202120222023
Cost incurred during the year$2,204,000 $3,192,000 $2,424,400
Estimated costs to complete as of year-end 5,396,000 2,204,000 0
Billings during the year 2,140,000 3,256,000 4,604,000
Cash collections during the year 1,870,000 3,200,000 4,930,000
Westgate recognizes revenue over time according to percentage of
completion.
Required:
1. Calculate the amount of revenue and gross profit (loss) to be
recognized in each of the three years. (Do not round intermediate
calculations. Loss amounts should be indicated with a minus
sign.)
2-a. In the journal below, complete the
necessary journal entries for the year 2021 (credit "Various
accounts" for construction costs incurred).
2-b. In the journal below, complete the necessary
journal entries for the year 2022 (credit "Various accounts" for
construction costs incurred).
2-c. In the journal below, complete the necessary
journal entries for the year 2023 (credit "Various accounts" for
construction costs incurred).
3.Complete the information required below to prepare a partial balance sheet for 2021 and 2022 showing any items related to the contract. (Do not round intermediate calculations.)
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.)
| 2021 | 2022 | 2023 | |||||||
| Costs incurred during the year | $ | 2,204,000 | $ | 3,870,000 | $ | 3,270,000 | |||
| Estimated costs to complete as of year-end | 5,396,000 | 3,170,000 | 0 | ||||||
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.)
| 2021 | 2022 | 2023 | |||||||
| Costs incurred during the year | $ | 2,204,000 | $ | 3,870,000 | $ | 4,110,000 | |||
| Estimated costs to complete as of year-end | 5,396,000 | 4,240,000 | 0 | ||||||
In: Accounting