United Snack Company sells 40-pound bags of peanuts to university
dormitories for $60 a bag. The fixed costs of this operation are
$671,600, while the variable costs of peanuts are $0.35 per
pound.
a. What is the break-even point in bags?
|
b. Calculate the profit or loss (EBIT) on 11,000 bags and on 24,000 bags.
|
c. What is the degree of operating leverage at
19,000 bags and at 24,000 bags? (Round your answers to 2 decimal
places.)
|
d. If United Snack Company has an annual interest
expense of $35,000, calculate the degree of financial leverage at
both 19,000 and 24,000 bags. (Round your answers to 2 decimal
places.)
|
e. What is the degree of combined leverage at both a sales level of 19,000 bags and 24,000 bags? (Round your answers to 2 decimal places.)
|
In: Accounting
United Snack Company sells 40-pound bags of peanuts to
university dormitories for $42 a bag. The fixed costs of this
operation are $417,120, while the variable costs of peanuts are
$0.26 per pound.
a. What is the break-even point in bags?
b. Calculate the profit or loss (EBIT) on
12,000 bags and on 25,000 bags.
c. What is the degree of operating leverage at
20,000 bags and at 25,000 bags? (Round your answers to 2
decimal places.)
d. If United Snack Company has an annual
interest expense of $26,000, calculate the degree of financial
leverage at both 20,000 and 25,000 bags. (Round your
answers to 2 decimal places.)
e. What is the degree of combined leverage at
both a sales level of 20,000 bags and 25,000 bags? (Round
your answers to 2 decimal places.)
In: Finance
United Snack Company sells 60-pound bags of peanuts to university dormitories for $58 a bag. The fixed costs of this operation are $545,200, while the variable costs of peanuts are $0.34 per pound.
a. What is the break-even point in bags?
b. Calculate the profit or loss (EBIT) on 12,000 bags and on 25,000 bags.
c. What is the degree of operating leverage at 20,000 bags and at 25,000 bags? (Round your answers to 2 decimal places.)
d. If United Snack Company has an annual interest expense of $34,000, calculate the degree of financial leverage at both 20,000 and 25,000 bags. (Round your answers to 2 decimal places.)
e. What is the degree of combined leverage at both a sales level of 20,000 bags and 25,000 bags? (Round your answers to 2 decimal places.)
In: Finance
United Snack Company sells 60-pound bags of peanuts to
university dormitories for $40 a bag. The fixed costs of this
operation are $305,000, while the variable costs of peanuts are
$0.25 per pound.
a. What is the break-even point in bags?
|
b. Calculate the profit or loss (EBIT) on 5,000 bags and on 18,000 bags.
|
c. What is the degree of operating leverage at 17,000 bags and at 22,000 bags? (Round your answers to 2 decimal places.)
| Bags | Degree of Operating Leverage | |
| 17,000 | ||
| 22,000 | ||
d. If United Snack Company has an annual interest expense of $25,000, calculate the degree of financial leverage at both 17,000 and 22,000 bags. (Round your answers to 2 decimal places.)
| Bags | Degree of Financial Leverage | |
| 17,000 | ||
| 22,000 | ||
e. What is the degree of combined leverage at
both a sales level of 17,000 bags and 22,000 bags? (Round
your answers to 2 decimal places.)
| Bags | Degree of Combined Leverage | |
| 17,000 | ||
| 22,000 | ||
In: Finance
A review of the ledger of Cullumber Company at December 31,
2020, produces the following data pertaining to the preparation of
annual adjusting entries.
| 1. | Prepaid Insurance $9,808. The company has separate insurance policies on its buildings and its motor vehicles. Policy B4564 on the building was purchased on April 1, 2019, for $7,344. The policy has a term of 3 years. Policy A2958 on the vehicles was purchased on January 1, 2020, for $4,300. This policy has a term of 2 years. |
| 2. | Unearned Rent Revenue $436,200. The company began subleasing office space in its new building on November 1. At December 31, the company had the following rental contracts that are paid in full for the entire term of the lease. |
| Date | Term (in months) |
Monthly Rent |
Number of Leases |
|||
| Nov. 1 | 9 | $5,200 | 4 | |||
| Dec. 1 | 6 | $8,300 | 5 |
| 3. | Notes Payable $143,000. This balance consists of a note for 9 months at an annual interest rate of 9%, dated November 1. |
| 4. | Salaries and Wages Payable $0. There are 10 salaried employees. Salaries are paid every Friday for the current week. 5 employees receive a salary of $750 each per week, and 5 employees earn $550 each per week. Assume December 31 is a Tuesday. Employees do not work weekends. All employees worked the last 2 days of December. |
Prepare the adjusting entries at December 31, 2020.
(Credit account titles are automatically indented when
the amount is entered. Do not indent
manually.)
|
No. |
Date |
Account Titles and Explanation |
Debit |
Credit |
| 1. | Dec. 31 | |||
| 2. | Dec. 31 | |||
| 3. | Dec. 31 | |||
| 4. | Dec. 31 | |||
In: Accounting
Note: Not all sales are always collected. Remember Bad Debt Expense. So don’t worry if the problems do not add up to 100%.
1. ABC Company has the following sales budget for the last six months of 2020:
July $9,000
August $8,000
September $11,000
October $9,000
Historically, the cash collection of sales has been as follows:
35% of sales collected in the month of sale,
45% of sales collected in the month following the sale,
20% of sales collected in the second month following the sale.
What are expected cash collections for September? For October?
February $175,000
March $160,000
April $145,000
May $135,000
June $130,000
Collection history for the company indicates that 50% of sales are collected in the month of the sale, 38% is collected in the following month, and 12% of sales are uncollectible.
How much are total budgeted cash receipts for April? For May? For June?
February $130,000
March $170,000
April $200,000
Collection history for the company indicates that 60% of sales are collected in the month of the sale, 36% is collected in the following month, and 4% of sales are uncollectible. How much are budgeted cash receipts for April?
In: Accounting
At the beginning of 2020, Dexter Company estimated that it would incur $220,000 of manufacturing overhead cost during 2020 and use 20,000 direct labor hours. On January 1, 2020, beginning balances of Materials Inventory, Work in Process Inventory, and Finished Goods Inventory were $60,000, $-0-, and $115,000, respectively.
Required:
Using the following account letters, indicate the journal entries to record the following for 2020. For example, the payment of an account payable would be: A, C. List the debit letter(s) first. Also indicate the entry amounts for 2, 3, 5, 6 and 7.
1. Purchased materials on account, $425,000.
2. Of the $425,000 total dollar value of materials used, $395,000 represented direct material.
3. Determined total factory labor, $228,000 (19,000 hrs. @$12/hr.). Of the factory labor, 16,500 were direct labor hours.
4. Incurred actual manufacturing overhead other than those items already recorded, $110,000. (Credit Accounts Payable and Accumulated Depreciation)
5. Applied manufacturing overhead based on direct labor hours to production.
6. Ending inventory of work in process was $75,000. Record the cost of goods manufactured.
7. Transferred the balance in Manufacturing Overhead to the appropriate account.
A. Accounts Payable
B. Accumulated Depreciation
C. Cash
D. Cost of Goods Sold
E. Finished Goods Inventory
F. Materials Inventory
G. Manufacturing Overhead
H. Wages Payable
I. Work in Process Inventory
In: Accounting
Softlux Inc. is a carpet manufacturer. For June 2020, the company had the following standards for one of its product lines: decorative mats.
Units produced 2,000
Direct materials per mat (in kilograms) 3
Cost per kilograms of direct materials $22.50
Standard direct manufacturing labour cost (per hour) $20.00
Standard manufacturing labour time (hours per mat) 2
The following data were compiled regarding actual performance:
Direct materials used (in kilograms) 6,400
Direct materials purchased (in kilograms) 6,500
Cost per kilogram of direct materials $24.00
Direct manufacturing labour hours 3,900
Total direct manufacturing labour cost $87,750
Required:
(A) Compute the materials price variance and the materials usage variance, and indicate whether the variance is favourable or unfavourable.
(B) Compute the labour rate variance and the labour efficiency variance, and indicate whether the variance is favourable or unfavourable.
(C) For each variance, provide a plausible explanation of why the variance occurred.
In: Accounting
A company produces and sells two products – A and B. During
January 2020 A were sold at the
amount of $19,200 and its variable expenses were $6,336. B were
sold at the amount of $32,800
and its variable expenses were $11,344. Fixed expenses were
$32,280.
Compute
1. Break-even point for the company in total sales dollars. Show
your calculation
2. If the sales mix shifts toward A without changes in total
sales, what is the company’s break-
even point? Explain.
In: Accounting
A . Prepare income statements for the XXX company in December 2020. Use the following information please :
B. What is the Gross Margin %?
C. What is Basic EPS? What is Diluted EPS?
***************Use below Information *********
Cost of Goods Sold. 600,000
Purchased patents 50,000
Sales Returns 30,000
Sales 1,505,000
Allowance for Doubtful Accounts 60,000
Trademarks 15,000
Sales and marketing expenses 220,000
Accounts Payable 65,000
Engineering Expenses 300,000
Contributed Capital 300,000
G&A Expenses 165,000
Goodwill 150,000
Sales Discounts 18,000
Sales Tax Payable 5,000
Interest Expense 32,000
Tax rate 35%
Loss on investments 10,000
Copyrights 30,000
Wages payable 100,000
Losses on division scheduled
for closing 100,000 before tax.
There are 500,000 average common shares outstanding and 100,000 equivalent shares.
In: Accounting