Generalize the formula for excess burden when supply curve is
perfectly elastic to the case where supply curve is upward sloping
and the elasticity of
supply is n. Show buyers price increases by n/(n+e)*tbPb and
sellers price decreases by e/(n+e)*tbPb
Derive the change of quantity traded from it.
In: Economics
Sycamore Plastics (SP) is a manufacturer of polyethylene plastic pellets used as a raw material by manufacturers of plastic goods around the U.S. SP currently operates four manufacturing centers in Philadelphia, PA; Atlanta, GA; St. Louis, MO; and Salt Lake City, UT. The plants have different capacities and production costs as indicated in the table below.
| PLANT | MAXIMUM
CAPACITY (× 100,000 LBS.) |
PROD.
COST (PER 1,000 LBS.) |
| Philadelphia | 8.1 | $322.00 |
| Atlanta | 9.2 | $272.00 |
| St. Louis | 12.1 | $302.00 |
| Salt Lake City | 10.1 | $247.00 |
SP currently has six contract
customers located in New York City; Birmingham, AL; Terre Haute,
IN; Dallas, TX; Spokane, WA; and San Diego, CA. Transportation
costs between the plants and various customers, as well as
contracted demand from each customer, are shown in the table
below.
| TRANSPORT COSTS PER 1,000 LBS. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| FROM/TO | NYC | BIRMINGHAM | TERRE HAUTE | DALLAS | SPOKANE | SAN DIEGO | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Philadelphia | $46 | $53 | $57 | $63 | $72 | $85 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Atlanta | 56 | 43 | 59 | 60 | 74 | 82 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| St. Louis | 58 | 61 | 51 | 55 | 59 | 70 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Salt Lake City | 73 | 72 | 68 | 58 | 52 | 60 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Total Demand (× 1,000 lbs.) |
526 | 415 | 926 | 601 | 334 | 401 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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In: Statistics and Probability
Val’s Hair Emporium operates a hair salon. Its unadjusted trial balance as of December 31, 2018, follows, along with information about selected accounts.
| Account Names | Debit | Credit | Further Information | |||||||
| Cash | $ | 4,800 | As reported on December 31 bank statement. | |||||||
| Supplies | 5,300 | Based on count, only $1,800 of supplies still exist. | ||||||||
| Prepaid Rent | 9,000 |
This amount was paid November 1 for rent through the end of January. |
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| Accounts Payable | $ | 2,000 |
This represents the total amount of bills received for supplies and utilities through December 15. Val estimates that the company has received $550 of utility services through December 31 for which it has not yet been billed. |
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| Salaries and Wages Payable |
0 |
Stylists have not yet been paid $200 for their work on December 31. |
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| Income Tax Payable | 0 |
The company has paid last year’s income taxes but not this year’s taxes. |
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| Common Stock | 3,000 | This amount was contributed for common stock in prior years. | ||||||||
| Retained Earnings | 800 | This is the balance reported at the end of last year. | ||||||||
| Service Revenue | 92,400 | Customers pay cash when they receive services. | ||||||||
| Salaries and Wages Expense |
30,100 |
This is the cost of stylist wages through December 30. |
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| Utilities Expense | 13,200 | This is the cost of utilities through December 15. | ||||||||
| Rent Expense | 30,000 | This year’s rent was $3,000 per month. | ||||||||
| Supplies Expense | 5,800 |
This is the cost of supplies used through November 30. |
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| Income Tax Expense | 0 | The company has an average tax rate of 20%. | ||||||||
| Totals | $ | 98,200 | $ | 98,200 | ||||||
In: Accounting
The following data were selected from the records of Sykes Company for the year ended December 31, Current Year. Balances January 1, Current Year Accounts receivable (various customers) $ 117,000 Allowance for doubtful accounts 6,000 In the following order, except for cash sales, the company sold merchandise and made collections on credit terms 4/10, n/30 (assume a unit sales price of $700 in all transactions and use the gross method to record sales revenue). Transactions during Current Year
Sold merchandise for cash, $248,000.
Sold merchandise to R. Smith; invoice price, $11,500.
Sold merchandise to K. Miller; invoice price, $23,000.
Two days after purchase date, R. Smith returned one of the units purchased in (b) and received account credit.
Sold merchandise to B. Sears; invoice price, $26,000.
R. Smith paid his account in full within the discount period.
Collected $99,000 cash from customer sales on credit in prior year, all within the discount periods.
Miller paid the invoice in (c) within the discount period.
Sold merchandise to R. Roy; invoice price, $20,500.
Three days after paying the account in full, K. Miller returned seven defective units and received a cash refund.
After the discount period, collected $6,000 cash on an account receivable on sales in a prior year.
Wrote off a prior year account of $5,000 after deciding that the amount would never be collected.
The estimated bad debt rate used by the company was 1.0 percent of credit sales net of returns.
In: Accounting
Interpreting the Accounts Receivable Footnote
Hewlett-Packard Company reports the following in its 2015 10-K
report.
| October 31 (in millions) |
2015 |
2014 |
|---|---|---|
| Accounts receivable | $13,363 | $13,832 |
Footnotes to the company's 10-K provide the following additional
information relating to its allowance for doubtful accounts.
| For the fiscal years ended October
31 (in millions) |
2015 |
2014 |
2013 |
|---|---|---|---|
| Allowance for doubtful accounts-accounts receivable | |||
| Balance, beginning of period | $232 | $332 | $464 |
| Provision for doubtful accounts | 46 | 25 | 23 |
| Deductions, net of recoveries | (89) | (125) | (155) |
| Balance, end of period | $189 | $232 | $332 |
(a) What is the gross amount of accounts receivables for
Hewlett-Packard in fiscal 2015 and 2014?
| ($ millions) | 2015 | 2014 |
|---|---|---|
| Gross accounts receivable | Answer | Answer |
(b)What is the percentage of the allowance for doubtful accounts to
gross accounts receivable for 2015 and 2014? (Round your answers to
two decimal places.)
| ($ millions) | 2015 | 2014 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Percentage of uncollectible accounts to gross accounts
receivable(d)Compute Hewlett-Packard's write-offs as a percentage
of the allowance account at the beginning of the year. (Round your answers to two decimal places) 2015 write-offs as a percentage of beginning of year allowance: Answer % 2014 write-offs as a percentage of beginning of year allowance: Answer % 2. Revenue Recognition: We generally recognize sales, net of estimated returns, at the time the member takes possession of merchandise or receives services. When we collect payment from customers prior to the transfer of ownership of merchandise or the performance of services, the amount recieved is generally recorded as deferred revenue on the consolidated balance sheets until the sales or service is completed. Membership fee revenue represents annual membership fees paid by our memberships. We account for membership fee revenue, net of estimated refunds, on a deferred basis, whereby revenue is recognized ratably over the one-year membership period.
(b) Use the balance sheet information on Costco's Deferred Membership Fees liability account and its income statement revenues related to Membership Fees earned during 2016 to compute the cash that Costco received during 2016 for membership fees. Total cash received (in $ millions) = $Answer
|
Answer % | Answer % | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
In: Accounting
On December 31, 2018, Marsh Company held Xenon Company bonds in its portfolio of available-for-sale securities. The bonds have a par value of $14,000, carry a 10% annual interest rate, mature in 2025, and had originally been purchased at par. The market value of the bonds at December 31, 2018 was $12,000. The December 31, 2018, balance sheet showed the following:
|
Marsh Company |
|
Partial Balance Sheet |
|
December 31, 2018 |
|
1 |
Assets |
|
|
2 |
Investment in Available-for-Sale Securities |
$14,000.00 |
|
3 |
Less: Allowance for Change in Fair Value of Investment |
(2,000.00) |
|
4 |
$12,000.00 |
|
|
5 |
Shareholders’ Equity: |
|
|
6 |
Unrealized Holding Gain/Loss |
$(2,000.00) |
On January 1, 2019, Marsh acquired bonds of Yellow Company with a par value of $16,000 for $16,200. The Yellow Company bonds carry an annual interest rate of 12% and mature on December 31, 2023. Additionally, Marsh acquired Zebra Company bonds with a face value of 19,000 for $18,600. The Zebra Company bonds carry an 8% annual interest rate and mature on December 31, 2028. At the end of 2019, the respective market values of the bonds were: Xenon, $13,000; Yellow, $17,000; and Zebra, $20,000. Marsh classifies all of the debt securities as available-for-sale as it does not intend to hold them to maturity nor does it intend to actively buy and sell them. Assume that Marsh uses the straight-line method to amortize any discounts or premiums.
Required:
| 1. | Prepare the journal entries necessary to record the purchase of the investments on January 1, 2019, the annual interest payments on December 31, 2019, and the adjusting entry needed on December 31, 2019. |
| 2. | What would Marsh disclose on its December 31, 2019, balance sheet related to these investments? |
| CHART OF ACCOUNTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Marsh Company | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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In: Accounting
On December 31, 2018, M Company held X Company bonds in its portfolio of available-for-sale securities. The bonds have a par value of $15,000, carry a 10% annual interest rate, mature in 2025, and had originally been purchased at par. The market value of the bonds at December 31, 2018 was $13,000. The December 31, 2018, balance sheet showed the following:
|
M Company |
|
Partial Balance Sheet |
|
December 31, 2018 |
|
1 |
Assets |
|
|
2 |
Investment in Available-for-Sale Securities |
$15,000.00 |
|
3 |
Less: Allowance for Change in Fair Value of Investment |
(2,000.00) |
|
4 |
$13,000.00 |
|
|
5 |
Shareholders’ Equity: |
|
|
6 |
Unrealized Holding Gain/Loss |
$(2,000.00) |
On January 1, 2019, M acquired bonds of Y Company with a par value of $16,000 for $16,200. The Y Company bonds carry an annual interest rate of 12% and mature on December 31, 2023. Additionally, M acquired Z Company bonds with a face value of 18,000 for $17,600. The Z Company bonds carry an 8% annual interest rate and mature on December 31, 2028. At the end of 2019, the respective market values of the bonds were: X, $14,000; Y, $17,000; and Z, $20,000. M classifies all of the debt securities as available-for-sale as it does not intend to hold them to maturity nor does it intend to actively buy and sell them. Assume that M uses the straight-line method to amortize any discounts or premiums.
Required:
| 1. | Prepare the journal entries necessary to record the purchase of the investments on January 1, 2019, the annual interest payments on December 31, 2019, and the adjusting entry needed on December 31, 2019. |
| 2. | What would M disclose on its December 31, 2019, balance sheet related to these investments? |
| CHART OF ACCOUNTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| M Company | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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In: Accounting
An employee of a small software company in Minneapolis bikes to work during the summer months. He can travel to work using one of three routes and wonders whether the average commute times (in minutes) differ between the three routes. He obtains the following data after traveling each route for one week.
Route 1 30 26 34 34 32
Route 2 23 22 28 25 20
Route 3 27 29 24 30 27
Construct an ANOVA table. (Round intermediate calculations to at least 4 decimal places. Round "SS", "MS", "p-value" to 4 decimal places and "F" to 3 decimal places.)
a-2. At the 5% significance level, do the average commute times differ between the three routes. Assume that commute times are normally distributed.
Yes since the p-value is less than significance level.
No since the p-value is less than significance level.
No since the p-value is not less than significance level.
Yes since the p-value is not less than significance level.
b. Use Tukey’s HSD method at the 5% significance level to determine which routes' average times differ. (You may find it useful to reference the q table). (If the exact value for nT − c is not found in the table, use the average of corresponding upper & lower studentized range values. Negative values should be indicated by a minus sign. Round your answers to 2 decimal places.)
| population mean difference | confidence interval | do the average times differ |
| uroute1-uroute2 | ||
| uroute1-uroute3 | ||
| uroute2-uroute3 |
In: Statistics and Probability
Question 3
The accounting records of Nutronics Inc include the following information for the year ended Dec 31. 2017
|
Dec 31, 2017 |
Jan 1, 2017 |
|
|
Raw material inventory Work in process Finished goods inventory Direct Material used Direct labor Manufacturing overhead Selling expenses Administrative expenses Sales revenue |
$24,000 8,000 90,000 210,000 120,000 192,000 170,000 140,000 720,000 |
$20,000 12,000 80,000 |
Required
A. Prepare a schedule of Cost of goods manufactured
B. Assume that the company manufactures a single product and that 20,000 units were completed during the year. What is the average per unit cost of manufacturing this product?
C. Assume that the company decides to sell the product at selling price at $25 per unit. What is your advice?
D. IGNORE YOUR ADVICE IN PART C. Assume the company sells a number of products. Compute the Cost of goods sold
E. Prepare an Income Statement for the company for the year ended Dec 31,
F. How is the company DOING FINANCIALLY in your opinion?
In: Accounting
1. On January 2, 2020, Murphy Company purchased land that cost $410,000, a building on the land that cost $1,450,000, and equipment that cost $70,000. The building has an estimated useful life of 29 years. The equipment has an estimated useful life of 7 years.
Required: Prepare the property, plant, and equipment section of the balance sheet as of December 31, 2020. Note: Use straight-line depreciation with no salvage value. Murphy Company Balance Sheet (partial) December 31 Property, Plant, and Equipment Buildings Accumulated Depreciation, Buildings Total Property, Plant, and Equipment
2. On December 31, Perez Company has earned interest revenue of $2,200 on outstanding notes, even though the company will not actually receive the interest until the following year.
Required:
Journalize the adjusting entry on December 31.
3. On January 1, Williams Company purchased a large piece of equipment for $46,200. It has an estimated useful life of 7 years.
Required:
Journalize the adjusting entry on December 31.
Note: Use straight-line depreciation with no salvage
value.
In: Accounting