Questions
Comparative balance sheet accounts of Splish Company are presented below. SPLISH COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS...

Comparative balance sheet accounts of Splish Company are presented below.

SPLISH COMPANY
COMPARATIVE BALANCE SHEET ACCOUNTS
AS OF DECEMBER 31

Debit Balances

2020

2019
Cash

$70,600

$50,500
Accounts Receivable

155,100

130,000
Inventory

75,600

61,100
Debt investments (available-for-sale)

55,100

84,300
Equipment

70,300

48,400
Buildings

144,400

144,400
Land

39,600

25,300
     Totals

$610,700

$544,000

Credit Balances
Allowance for Doubtful Accounts

$10,000

$7,900
Accumulated Depreciation—Equipment

21,000

14,100
Accumulated Depreciation—Buildings

37,300

28,200
Accounts Payable

66,400

60,600
Income Taxes Payable

11,900

9,900
Long-Term Notes Payable

62,000

70,000
Common Stock

310,000

260,000
Retained Earnings

92,100

93,300
     Totals

$610,700

$544,000


Additional data:

1. Equipment that cost $10,100 and was 60% depreciated was sold in 2020.
2. Cash dividends were declared and paid during the year.
3. Common stock was issued in exchange for land.
4. Investments that cost $34,600 were sold during the year.
5. There were no write-offs of uncollectible accounts during the year.


Splish’s 2020 income statement is as follows.

Sales revenue

$949,600
Less: Cost of goods sold

600,500
Gross profit

349,100
Less: Operating expenses (includes depreciation expense and bad debt expense)

247,700
Income from operations

101,400
Other revenues and expenses
   Gain on sale of investments

$14,900
   Loss on sale of equipment

(3,100

)

11,800
Income before taxes

113,200
Income taxes

44,600
Net income

$68,600


(a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Net cash flow from operating activities $


(b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

In: Accounting

Comparative balance sheet accounts of Carla Company are presented below. CARLA COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS...

Comparative balance sheet accounts of Carla Company are presented below.

CARLA COMPANY
COMPARATIVE BALANCE SHEET ACCOUNTS
AS OF DECEMBER 31

Debit Balances

2020

2019
Cash

$69,900

$50,600
Accounts Receivable

154,800

130,300
Inventory

75,700

61,400
Debt investments (available-for-sale)

55,100

84,600
Equipment

69,300

48,400
Buildings

145,700

145,700
Land

40,200

25,200
     Totals

$610,700

$546,200

Credit Balances
Allowance for Doubtful Accounts

$10,100

$7,900
Accumulated Depreciation—Equipment

21,000

14,000
Accumulated Depreciation—Buildings

36,800

28,100
Accounts Payable

65,600

59,500
Income Taxes Payable

12,000

10,100
Long-Term Notes Payable

62,000

70,000
Common Stock

310,000

260,000
Retained Earnings

93,200

96,600
     Totals

$610,700

$546,200


Additional data:

1. Equipment that cost $10,100 and was 60% depreciated was sold in 2020.
2. Cash dividends were declared and paid during the year.
3. Common stock was issued in exchange for land.
4. Investments that cost $35,100 were sold during the year.
5. There were no write-offs of uncollectible accounts during the year.


Carla’s 2020 income statement is as follows.

Sales revenue

$943,500
Less: Cost of goods sold

595,900
Gross profit

347,600
Less: Operating expenses (includes depreciation expense and bad debt expense)

247,500
Income from operations

100,100
Other revenues and expenses
   Gain on sale of investments

$14,900
   Loss on sale of equipment

(3,000

)

11,900
Income before taxes

112,000
Income taxes

45,500
Net income

$66,500


(a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Net cash flow from operating activities $


(b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

In: Accounting

q. 27 JBL Aircraft manufactures and distributes aircraft parts and supplies. Employees are offered a variety...

q. 27

JBL Aircraft manufactures and distributes aircraft parts and supplies. Employees are offered a variety of share-based compensation plans. Under its nonqualified stock option plan, JBL granted options to key officers on January 1, 2018. The options permit holders to acquire 6.5 million of the company's $1 par common shares for $22 within the next six years, but not before January 1, 2021 (the vesting date). The market price of the shares on the date of grant is $26 per share. The fair value of the 6.5 million options, estimated by an appropriate option pricing model, is $6 per option. Because the plan does not qualify as an incentive plan, JBL will receive a tax deduction upon exercise of the options equal to the excess of the market price at exercise over the exercise price. The tax rate is 40%.

Required:
1. Determine the total compensation cost pertaining to the incentive stock option plan.
2. & 3. Record the necessary journal entries on December 31, 2018, 2019, and 2020. Assume all of the options are exercised on August 21, 2022, when the market price is $27 per share.

Determine the total compensation cost pertaining to the incentive stock option plan. (Enter your answer in millions (i.e., 10,000,000 should be entered as 10).)
Total compensation cost million

req.2

journal 1.Record compensation expense on December 31, 2018.

journal 2.Record any tax effect related to compensation expense recorded in 2018.

journal 3.Record compensation expense on December 31, 2019.

journal 4. Record any tax effect related to compensation expense recorded in 2019.

journal 5.Record compensation expense on December 31, 2020.

journal 6.Record any tax effect related to compensation expense recorded in 2020.

journal 7.Record the exercise of the options on August 21, 2022 when the market price is $27 per share.

journal 8.Record any tax effect related to the exercise of the options.

In: Accounting

Problem 3-02A a-d (Part Level Submission) Cullumber's Hotel opened for business on May 1, 2020. Its...

Problem 3-02A a-d (Part Level Submission)

Cullumber's Hotel opened for business on May 1, 2020. Its trial balance before adjustment on May 31 is as follows.

CULLUMBER'S HOTEL
Trial Balance
May 31, 2020
Account Number Debit Credit
101 Cash $ 3,400
126 Supplies 2,100
130 Prepaid Insurance 3,000
140 Land 15,000
141 Buildings 60,600
149 Equipment 15,600
201 Accounts Payable $ 4,800
208 Unearned Rent Revenue 3,300
275 Mortgage Payable 40,000
301 Owner’s Capital 41,200
429 Rent Revenue 15,100
610 Advertising Expense 550
726 Salaries and Wages Expense 3,200
732 Utilities Expense 950     
$104,400 $104,400

In addition to those accounts listed on the trial balance, the chart of accounts for Cullumber’s Hotel also contains the following accounts and account numbers: No. 142 Accumulated Depreciation—Buildings, No. 150 Accumulated Depreciation—Equipment, No. 212 Salaries and Wages Payable, No. 230 Interest Payable, No. 619 Depreciation Expense, No. 631 Supplies Expense, No. 718 Interest Expense, and No. 722 Insurance Expense.

Other data:
1. Prepaid insurance is a 1-year policy starting May 1, 2020.
2. A count of supplies shows $700 of unused supplies on May 31.
3. Annual depreciation is $3,636 on the buildings and $1,560 on equipment.
4. The mortgage at an annual interest rate is 6%. (The mortgage was taken out on May 1.)
5. Two-thirds of the unearned rent revenue has been earned.
6. Salaries of $700 are accrued and unpaid at May 31.

(a)

Journalize the adjusting entries on May 31. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

No.

Date

Account Titles and Explanation

Debit

Credit
1. May 31
2. May 31
3. May 31
4. May 31
5. May 31
6. May 31
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In: Accounting

Sax Company signs a lease agreement dated January 1, 2019, that provides for it to lease...

Sax Company signs a lease agreement dated January 1, 2019, that provides for it to lease computers from Appleton Company beginning January 1, 2019. The lease terms, provisions, and related events are as follows:

1. The lease term is 5 years. The lease is noncancelable and requires equal rental payments to be made at the end of each year. The computers are not specialized for Sax.
2. The computers have an estimated life of 5 years, a fair value of $300,000, and a zero estimated residual value.
3. Sax agrees to pay all executory costs directly to a third party.
4. The lease contains no renewal or bargain purchase options.
5. The annual payment is set by Appleton at $83,222.92 to earn a rate of return of 12% on its net investment. Sax is aware of this rate. Sax’s incremental borrowing rate is 10%.
6. Sax uses the straight-line method to record depreciation on similar equipment.

Required:

1. Next Level Examine and evaluate each capitalization criteria and determine what type of lease this is for Sax.
2. Calculate the amount of the asset and liability of Sax at the inception of the lease (round to the nearest dollar).
3. Prepare a table summarizing the lease payments and interest expense.
4.

Prepare journal entries for Sax for the years 2019 and 2020.

All transactions on this page must be entered (except for post ref(s)) before you will receive Check My Work feedback.

PAGE 2019

GENERAL JOURNAL

Score: 23/88

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

1

2

3

4

5

6

7

Record the right-of-use asset and the lease liability on January 1. Use the Summary of Lease Payments and Interest Expense Schedule to determine amounts for the payment and amortize the right-of-use asset using the straight-line method on December 31.

4b. Prepare journal entries for Sax for the year 2020.

Question not attempted.

PAGE 2020

GENERAL JOURNAL

DATE ACCOUNT TITLE POST. REF. DEBIT CREDIT

1

2

3

4

5

In: Accounting

Schultz Electronics manufactures two ultra high-definition television models: the Royale which sells for $1,480, and a...

Schultz Electronics manufactures two ultra high-definition television models: the Royale which sells for $1,480, and a new model, the Majestic, which sells for $1,270. The production cost computed per unit under traditional costing for each model in 2020 was as follows.

Traditional Costing

Royale

Majestic
Direct materials

$640

$430
Direct labor ($20 per hour)

120

100
Manufacturing overhead ($39 per DLH)

234

195
Total per unit cost

$994

$725


In 2020, Schultz manufactured 25,000 units of the Royale and 10,000 units of the Majestic. The overhead rate of $39 per direct labor hour was determined by dividing total estimated manufacturing overhead of $7,887,400 by the total direct labor hours (200,000) for the two models.

Under traditional costing, the gross profit on the models was Royale $486 ($1,480 – $994) and Majestic $545 ($1,270 – $725). Because of this difference, management is considering phasing out the Royale model and increasing the production of the Majestic model.

Before finalizing its decision, management asks Schultz’s controller to prepare an analysis using activity-based costing (ABC). The controller accumulates the following information about overhead for the year ended December 31, 2020.

Activity
Cost Pools

Cost Drivers

Estimated
Overhead

Estimated Use of
Cost Drivers

Activity-Based
Overhead Rate
Purchasing Number of orders $1,209,000 39,000 $31/order
Machine setups Number of setups 980,500 18,500 $53/setup
Machining Machine hours 4,883,100 119,100 $41/hour
Quality control Number of inspections 814,800 29,100 $28/inspection


The cost drivers used for each product were:

Cost Drivers

Royale

Majestic

Total
Purchase orders 17,000 22,000 39,000
Machine setups 6,000 12,500 18,500
Machine hours 74,000 45,100 119,100
Inspections 11,000 18,100 29,100

Calculate cost per unit of each model using ABC costing. (Round answers to 2 decimal places, e.g. 12.25.)

In: Accounting

Elegant Furniture Company(Elegant) manufactures and sells modern furniture. The company’s products only include two models of...

Elegant Furniture Company(Elegant) manufactures and sells modern furniture. The company’s products only include two models of dining table: Deluxe and Simplicity. The selling prices and costs data for each unit of the products are as follows: Deluxe Simplicity $ $ Selling price 10,000 8,000 Direct materials (variable) 2,600 2,300 Direct labour (variable) 500 400 Manufacturing overhead (semi-variable, 90% fixed) 5,000 4,000 Selling expenses (variable) 400 400 Administrative expenses (fixed) 1,000 800 According to Elegant’s 2020 business plan, the company wants to achieve the target of manufacturing and selling at least 5,000 units of Deluxe and 2,000 units of Simplicity every month. Currently the company’s manufacturing process is limited by the machine capacity in the machining department. The total machine time available in the machining department is 78,000 minutes per month. Apart from this, there is no other relevant constraint on the manufacturing process. Each unit of Deluxe requires 12 minutes of machine time and each unit of Simplicity requires 6 minutes of machine time. Required:

(c) Assuming that there is unlimited demand for Deluxe and Simplicity at current selling prices, what product mix, i.e. how many units of Deluxe and Simplicity should Elegant produce and sell that will maximize its operating income while meeting its 2020 business plan? Show your calculations clearly.

(d) Assuming that the demand of Simplicity is limited to 2,500 units, what product mix should the company adopt to maximize operating income while meeting its 2020 business plan? Show your calculations clearly. (e) In view of the constraint on machining time, the production manager suggests to outsource the manufacture of Simplicity to a vendor who has offered a very competitive price. The management accountant has analysed and confirmed that there will be cost advantages from the outsourcing proposal. Suggest TWO strategic and qualitative issues that Elegant’s management may consider before making the decision. Question 2 Advanced Electronics Ltd (Advanced) manufactures and sells high-end electronic

In: Accounting

Additional Information: A.   Sold plant assets with a cost of $75,000 and accumulated depreciation of $7,500,...

Additional Information:
A.   Sold plant assets with a cost of $75,000 and accumulated depreciation of $7,500,
       yielding a gain of disposal of plant assets of $12,000.
B.   Purchased plant assets by paying cash.
C.   Issued Notes Payable for Cash.
D.   Sold investment in Walking Dead Co at cost (zero gain/loss).
E.   Issued Common Stock for Cash.
F.   Purchased Treasury Stock for Cash.
Requirements:
Prepare, in good form, a Statement of Cash Flows using the indirect method.
Statement of Cash Flows
Angela's Cleaning Consortium Seymour-Johnson, Inc.
Comparative Balance Sheet Income Statement
December 31, 2020 and 2019 For the Year Ended December 31, 2020
2020 2019 Net sales $ 386,000
ASSETS Cost of goods sold     (212,000)
Current assets Gross profit      174,000
   Cash $    66,500 $    62,000 Operating expenses
   Accounts receivable        95,000      113,000 Salaries and wages expense       (66,000)
   Merchandise inventory      172,000      165,000 Depreciation expense       (25,000)
      Total current assets      333,500      340,000 Other operating expenses       (28,000)
Long-term investments Income from operations        55,000
   Investment in Walking Dead Co.                 -        50,000 Other revenues and gains
Property, buildings, and equipment      507,000      304,000    Interest revenue        15,000
   Less: Accumulated depreciation       (59,500)       (42,000)    Dividend revenue          9,700
Total assets $ 781,000 $ 652,000    Gain on disposal of plant assets        12,000
Liabilities and Stockholders' Equity Other expenses and losses
Current liabilities    Interest expense       (15,000)
      Accounts payable $ 144,000 $ 175,000 Income before income taxes        76,700
      Accrued liabilities        17,000        47,000 Income tax expense       (14,000)
      Total current assets      161,000      222,000 Net Income $    62,700
   Long-term Liabilities
      Notes payable, long-term      160,000        90,000
         Total liabilities      321,000      312,000
Stockholders' equity
   Common stock      370,000      250,000
   Retained earnings      140,000        90,000
   Treasury stock       (50,000)                 -
         Total Stockholders’ Equity      460,000      340,000
Total Liabilities & Stockholders' Equity $ 781,000 $ 652,000

In: Accounting

Statement of Cash Flows Angela's Cleaning Consortium Seymour-Johnson, Inc. Comparative Balance Sheet Income Statement December 31,...

Statement of Cash Flows
Angela's Cleaning Consortium Seymour-Johnson, Inc.
Comparative Balance Sheet Income Statement
December 31, 2020 and 2019 For the Year Ended December 31, 2020
2020 2019 Net sales $ 386,000
ASSETS Cost of goods sold     (212,000)
Current assets Gross profit      174,000
   Cash $    66,500 $    62,000 Operating expenses
   Accounts receivable        95,000      113,000 Salaries and wages expense       (66,000)
   Merchandise inventory      172,000      165,000 Depreciation expense       (25,000)
      Total current assets      333,500      340,000 Other operating expenses       (28,000)
Long-term investments Income from operations        55,000
   Investment in Walking Dead Co.                 -        50,000 Other revenues and gains
Property, buildings, and equipment      507,000      304,000    Interest revenue        15,000
   Less: Accumulated depreciation       (59,500)       (42,000)    Dividend revenue          9,700
Total assets $ 781,000 $ 652,000    Gain on disposal of plant assets        12,000
Liabilities and Stockholders' Equity Other expenses and losses
Current liabilities    Interest expense       (15,000)
      Accounts payable $ 144,000 $ 175,000 Income before income taxes        76,700
      Accrued liabilities        17,000        47,000 Income tax expense       (14,000)
      Total current assets      161,000      222,000 Net Income $    62,700
   Long-term Liabilities
      Notes payable, long-term      160,000        90,000
         Total liabilities      321,000      312,000
Stockholders' equity
   Common stock      370,000      250,000
   Retained earnings      140,000        90,000
   Treasury stock       (50,000)                 -
         Total Stockholders’ Equity      460,000      340,000
Total Liabilities & Stockholders' Equity $ 781,000 $ 652,000
Additional Information:
A.   Sold plant assets with a cost of $75,000 and accumulated depreciation of $7,500,
       yielding a gain of disposal of plant assets of $12,000.
B.   Purchased plant assets by paying cash.
C.   Issued Notes Payable for Cash.
D.   Sold investment in Walking Dead Co at cost (zero gain/loss).
E.   Issued Common Stock for Cash.
F.   Purchased Treasury Stock for Cash.
Requirements:
Prepare, in good form, a Statement of Cash Flows using the indirect method.

In: Accounting

Comparative balance sheet accounts of Sweet Company are presented below. SWEET COMPANY COMPARATIVE BALANCE SHEET ACCOUNTS...

Comparative balance sheet accounts of Sweet Company are presented below.

SWEET COMPANY
COMPARATIVE BALANCE SHEET ACCOUNTS
AS OF DECEMBER 31

Debit Balances

2020

2019
Cash

$69,600

$51,100
Accounts Receivable

156,500

130,000
Inventory

75,700

60,800
Debt investments (available-for-sale)

55,000

85,300
Equipment

69,600

47,800
Buildings

144,900

144,900
Land

39,600

25,200
     Totals

$610,900

$545,100

Credit Balances
Allowance for Doubtful Accounts

$10,000

$8,000
Accumulated Depreciation—Equipment

20,800

14,100
Accumulated Depreciation—Buildings

37,000

27,900
Accounts Payable

66,500

59,800
Income Taxes Payable

11,900

10,000
Long-Term Notes Payable

62,000

70,000
Common Stock

310,000

260,000
Retained Earnings

92,700

95,300
     Totals

$610,900

$545,100


Additional data:

1. Equipment that cost $10,000 and was 60% depreciated was sold in 2020.
2. Cash dividends were declared and paid during the year.
3. Common stock was issued in exchange for land.
4. Investments that cost $34,800 were sold during the year.
5. There were no write-offs of uncollectible accounts during the year.


Sweet’s 2020 income statement is as follows.

Sales revenue

$955,000
Less: Cost of goods sold

601,700
Gross profit

353,300
Less: Operating expenses (includes depreciation expense and bad debt expense)

252,500
Income from operations

100,800
Other revenues and expenses
   Gain on sale of investments

$15,000
   Loss on sale of equipment

(2,900

)

12,100
Income before taxes

112,900
Income taxes

45,300
Net income

$67,600


(a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Net cash flow from operating activities $


(b) Prepare a statement of cash flows using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)

In: Accounting