A firm has a fixed cost of $20,000 in its first year of operation. When the firm produces 1,000 units of output, its total costs are $80,000. When it produces 1,100 units of output, its variable costs are $70,000. If the marginal cost of each of the 100 additional units of output is the same then the marginal cost of producing the 1,050th unit of output is less than $90.
True
false
The average variable cost curve and average total cost curve will eventually intersect as output increases because average fixed cost eventually becomes negative.
True
False
If marginal cost is rising, then it is likely that marginal product is decreasing because the additional input costs are spread over fewer units of output.
True
False
In: Economics
Naranjo Company designs industrial prototypes for outside companies. Budgeted overhead for the year was $160,000, and budgeted direct labor hours were 16,000. The average wage rate for direct labor is expected to be $20 per hour. During June, Naranjo Company worked on four jobs. Data relating to these four jobs follow: Job 39 Job 40 Job 41 Job 42 Beginning balance $23,300 $32,900 $19,700 $700 Materials requisitioned 19,800 20,800 12,900 15,200 Direct labor cost 10,900 17,900 7,550 6,100 Overhead is assigned as a percentage of direct labor cost. During June, Jobs 39 and 40 were completed; Job 39 was sold at 120 percent of cost. (Naranjo had originally developed Job 40 to order for a customer; however, that customer was near bankruptcy and the chance of Naranjo being paid was growing dimmer. Naranjo decided to hold Job 40 in inventory while the customer worked out its financial difficulties. Job 40 is the only job in Finished Goods Inventory.) Jobs 41 and 42 remain unfinished at the end of the month.
Required: 1. Calculate the balance in Work in Process as of June 30. $
2. Calculate the balance in Finished Goods as of June 30. $
3. Calculate the cost of goods sold for June. $
4. Calculate the price charged for Job 39. Round your answer to the nearest cent. $
In: Accounting
At the beginning of Year 2, the Redd Company had the following
balances in its accounts:
| Cash | $ | 16,800 |
| Inventory | 9,000 | |
| Land | 3,900 | |
| Common stock | 17,000 | |
| Retained earnings | 12,700 | |
During Year 2, the company experienced the following
events:
Record the events in general journal format. Assume that the perpetual inventory method and gross method is used.
In: Accounting
At the beginning of Year 2, the Redd Company had the following
balances in its accounts:
| Cash | $ | 15,300 |
| Inventory | 5,500 | |
| Land | 2,300 | |
| Common stock | 12,000 | |
| Retained earnings | 11,100 | |
During Year 2, the company experienced the following events:
Purchased inventory that cost $11,500 on account from Ross Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of $830 were paid in cash.
Returned $600 of the inventory it had purchased from Ross Company because the inventory was damaged in transit. The seller agreed to pay the return freight cost.
Paid the amount due on its account payable to Ross Company within the cash discount period.
Sold inventory that had cost $8,000 for $14,000 on account, under terms 2/10, n/45.
Received merchandise returned from a customer. The merchandise originally cost $1,350 and was sold to the customer for $2,400 cash. The customer was paid $2,400 cash for the returned merchandise.
Delivered goods FOB destination in Event 4. Freight costs of $720 were paid in cash.
Collected the amount due on the account receivable within the discount period.
Sold the land for $4,100.
Recognized accrued interest income of $400.
Took a physical count indicating that $6,800 of inventory was on hand at the end of the accounting period. (Hint:Determine the current balance in the inventory account before calculating the amount of the inventory write down.)
e. Use a single general journal to close all revenue, gain, and expense accounts to the retained earnings account. Post the journal entry to the ledger accounts created in Part c and prepare a post-closing trial balance. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
In: Accounting
At the beginning of Year 2, the Redd Company had the following
balances in its accounts:
| Cash | $ | 16,800 |
| Inventory | 4,000 | |
| Land | 2,000 | |
| Common stock | 12,000 | |
| Retained earnings | 10,800 | |
During Year 2, the company experienced the following
events:
Purchased inventory that cost $11,200 on account from Ross Company under terms 2/10, n/30. The merchandise was delivered FOB shipping point. Freight costs of $800 were paid in cash.
Returned $600 of the inventory it had purchased from Ross Company because the inventory was damaged in transit. The seller agreed to pay the return freight cost.
Paid the amount due on its account payable to Ross Company within the cash discount period.
Sold inventory that had cost $8,000 for $13,500 on account, under terms 2/10, n/45.
Received merchandise returned from a customer. The merchandise originally cost $1,200 and was sold to the customer for $2,100 cash. The customer was paid $2,100 cash for the returned merchandise.
Delivered goods FOB destination in Event 4. Freight costs of $800 were paid in cash.
Collected the amount due on the account receivable within the discount period.
Sold the land for $3,500.
Recognized accrued interest income of $500.
Took a physical count indicating that $6,500 of inventory was on hand at the end of the accounting period. (Hint:Determine the current balance in the inventory account before calculating the amount of the inventory write down.)
Use a single general journal to close all revenue, gain, and expense accounts to the retained earnings account. Post the journal entry to the ledger accounts created in Part c and prepare a post-closing trial balance. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
In: Accounting
On January 1 of year 1, Falk Company signed a contract to lease space in a building for 3 years. The lease contract calls for annual (prepaid) rental payments of $141,000 on each January 1 throughout the life of the lease and for the lessee to pay for all additions and improvements to the leased property. Present value of the three lease payments is $392,400.
Required:
1. Assume the lease is accounted for as a finance lease. Prepare entries for Falk to record (a) the lease asset and obligation at January 1, Year 1, and (b) the $130,800 per year straight-line amortization at December 31 of Year 1, 2, and 3.
a).Record lease asset and obligation.
b).Record annual amortization of RoU asset.
Required:
2.Assume the lease is accounted for as an operating lease. Prepare entries for Falk to record (a) the lease asset and obligation at January 1, Year 1, and (b) the annual straight-line amortization at December 31 of Year 1, 2, and 3 equal to $140,986, $120,872, and $130,542, respectively. (Do not round your intermediate calculations.)
a).Record the lease asset and obligation at January 1, Year 1.
b).Record the annual straight-line amortization at December 31 of Year 1.
c).Record the annual straight-line amortization at December 31 of Year 2
d).Record the annual straight-line amortization at December 31 of Year 3.
In: Accounting
At the beginning of the year, a company's balance sheet reported the following balances: Total Assets = $165,000; Total Liabilities = $24,300; Total Paid-in capital of $56,700; and Retained earnings = $84,000. During the year, the company reported revenues of $49,600 and expenses of $32,400. In addition, dividends for the year totaled $21,600. Assuming no other changes to Retained earnings, the balance in the Retained earnings account at the end of the year would be:
In: Accounting
At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $294,000 and Total Liabilities of $113,500. During the year, the company reported total revenues of $347,000 and expenses of $268,500. Also, owner withdrawals during the year totaled $70,000. Assuming no other changes to owner's capital, the balance in the owner's capital account at the end of the year would be: Multiple Choice $189,000. $256,000. $186,000. $296,500. $183,000.
In: Accounting
Jet Company's summarized financial statement information for the beginning of the year is as follows:
Marketable Securities $50,000
All Other Assets $150,000
Total Liabilities $80,000
Total Stockholders' Equity $120,000
During the year, Jet had Revenue of $77,000, Expenses of $46,000 and paid cash dividends of $7,000. Marketable Securities increased in value by 16% , liabilities remained unchanged for the year and Jet had 15,000 shares outstanding all year. Calculate the information that Jet would report on its financial statements at the end of the year.
TOTAL ASSETS =
TOTAL EQUITY =
In: Accounting
Jet Company's summarized financial statement information for the beginning of the year is as follows:
Marketable Securities $50,000
All Other Assets $150,000
Total Liabilities $80,000
Total Stockholders' Equity $120,000
During the year, Jet had Revenue of $77,000, Expenses of $46,000 and paid cash dividends of $7,000. Marketable Securities increased in value by 16% , liabilities remained unchanged for the year and Jet had 15,000 shares outstanding all year. Calculate the information that Jet would report on its financial statements at the end of the year.
Net income =
Total assets =
Total liabilities =
Total equity =
Eps =
In: Accounting