Jones Souvenirs Hut does customized, hand-crafted memorabilia for hotels, in which each batch of souvenirs is a job. The company uses a perpetual inventory system and has a highly labour-intensive production process, so it assigns manufacturing overhead based on direct labour cost. Joust’s predetermined overhead rate for 2017 was computed from the following data:

Total estimated factory overhead $2,400,000

Total estimated direct labour cost $2,000,000

The WIP account given below relates to the activities of Jones Souvenirs for the month of April:

WIP Inventory A/C

Additional data:

? Total material requisitioned …………………………………… $153,000

? Manufacturing Labour Costs incurred……………………… $163,500  (75% represents direct labour)

? Other manufacturing overheads incurred ………………… $94,275

? Two jobs were completed with total costs of $183,000 and $105,000 respectively. They were sold to the hotel on account at a margin of 33 1/3% on sales.

Required:

(a) Compute Jones Souvenirs predetermined manufacturing overhead rate for 2017.

(b) State the journal entries necessary to record the following transactions in the general journal.

(i) Total materials issued to production

(ii) Assign manufacturing labour to the appropriate accounts

(iii) Other manufacturing overhead incurred

(iv) Manufacturing overhead applied to production

(v) Move completed jobs to finished goods

(vi)Account for jobs completed and sold

(c) Post the manufacturing overhead transactions to the Manufacturing Overhead T-account. What is the balance on the account before performing end of period closing entries? Is manufacturing overhead under- or over- absorbed? State the journal entries necessary to dispose of the variance. Assume that the manufacturing overhead variance is immaterial.

(d) What is the balance in the Cost of Goods Sold account after the adjustment?

(e) Compute Jones Souvenirs gross profit earned on the jobs, after adjusting for the manufacturing overhead variance.

(f) Determine the balance in Work in Process Inventory on April 30

1. Net Present Value (NPV) and Internal Rate of Return (IRR) (question)

The City and County of Denver is completing a $45 million renovation of City Park Golf Course. To complete the renovation, the course has been closed to the public for 2.5 years (planned re-opening is Spring 2020). The project updated the course, built a new clubhouse that can accommodate golf and community events, resulted in a “net gain of 500 trees”, and reduced flood risk “for thousands of homes”.[1] All of these updates are expected to provide either increased revenue or reduced costs. Assume the $45 million cost was paid upfront by Denver and the following are the estimated cash receipts and disbursements associated with the project.[1] If the cost of capital is 6%, does the project make sense based on NPV and IRR over a 30-year useful life? Does your finding change if the cost of capital is actually 4%?

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Pollution Busters Inc. is considering a purchase of 10 additional carbon sequesters for $114,000 apiece. The sequesters last for only 1 year before becoming saturated. Then the carbon is sold to the government.

a. Suppose the government guarantees the price of carbon. At this price, the payoff after 1 year is $135,660 for sure. How would you determine the opportunity cost of capital for this investment?

b-1. Suppose instead that the sequestered carbon has to be sold on the London Carbon Exchange. Carbon prices have been extremely volatile, but Pollution Busters’ CFO learns that average rates of return from investments on that exchange have been about 24%. She thinks this is a reasonable forecast for the future. What is the opportunity cost of capital in this case in a percentage?

b-2. (Yes or No) If the expected return on the investment is still 19%, but instead depends on the price of carbon (so that it is no longer risk-free), then is the purchase of additional sequesters an attractive investment for the firm?

Rey Custom Electronics (RCE) sells and installs complete security, computer, audio, and video systems for homes. On newly constructed homes it provides bids using time-and-material pricing. The following budgeted cost data are available.

The company has budgeted for 5,770 hours of technician time during the coming year. It desires a $ 37.24 profit margin per hour of labor and an 80% profit on parts. It estimates the total invoice cost of parts and materials in 2017 will be $ 736,000 .

Compute the rate charged per hour of labor. (Round answer to 2 decimal places, e.g. 10.50.)

Compute the material loading percentage. (Round answer to 2 decimal places, e.g. 10.50.)

Previous time I tried this problem, I got the answer wrong.

The Muse Co. just issued a dividend of $3.64 per share on its common stock. The company is expected to maintain a constant 6.44 percent growth rate in its dividends indefinitely. If the stock sells for $62 a share, what is the company's cost of equity? (Enter your answer as a percentage, omit the "%" sign in your response, and round your answer to 2 decimal places. For example, 0.12345 or 12.345% should be entered as 12.35.)

You Answered

Correct Answer 12.69

I need a CORRECT answer with STEP-BY-STEP solution to the following (same one but with different numbers):

The Muse Co. just issued a dividend of $3.07 per share on its common stock. The company is expected to maintain a constant 6.57 percent growth rate in its dividends indefinitely.

If the stock sells for $61 a share, what is the company's cost of equity?

Rose, Inc. uses the dollar-value LIFO retail inventory method. For years ending 2015-2019 they counted the following dollar amounts for inventory at retail prices

2015 $124,000

2016 $138,600

2017 $157,500

2018 $149,240

2019 $155,700

As far as prices are concerned, the following year end price indexes were estimated as:

2015 1.00

2016 1.04

2017 1.10 (10 percent higher prices than in 2015)

2018 1.13

2019 1.15

The cost to retail percentage for those items added in each year were as follows – this means the comparison of purchases for cost versus retail has already been done and does not need to be repeated.

2015 60%

2016 61%

2017 62%

2018 63%

2019 62%

Required: Give the amounts that should be listed on the year-end balance sheet for each of the following years:

1. 2015

2. 2016

3. 2017

4. 2018

5. 2019

Kayla Company uses the perpetual inventory system and the LIFO method. The following information is available for the month of June:


June 1 Beginning inventory 200 units @ $5
12 Purchase on account 400 units @ $6
15 Sales on account 440 units
23 Purchase on account 300 units @ $7
27 Sales on account 360 units
The selling price (price the company charged the customers) was $10 per unit.

a) Show the calculation of cost of goods sold and ending inventory under LIFO.

b) What is the amount of Sales Revenue?

c) Prepare a journal entry for the sale of inventory on June 15.

d) In which financial statement does the amount of ending inventory appear?

e) In which financial statement do the amount of sales and amount of cost of goods sold appear?

f) What is the amount of gross margin for month June?

g) What is the gross margin percentage?

Cycle Wholesaling sells merchandise on credit terms of 2/10, n/30. A sale for $1,050 (cost of goods sold of $625) was made to Sarah’s Cycles on February 1. Assume Cycle Wholesaling uses a perpetual inventory system. Required: 1. to 3. Record the entry for sales, cost of goods sold and cash collected on February 9 and March 2. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

1. Give the journal entry Cycle Wholesaling would make to record the sale to Sarah's Cycles.
2. Give the journal entry to record the collection of the account, assuming it was collected in full on Feb 9, 2010.
3. Give the journal entry, assuming, instead, that the account was collected in full on march 2, 2010.
4. Calculate the gross profit percentage for the sale to Sarah's Cycles, assuming the account was collected in full on Feb 9, 2010.

Refer to the table below.

Suppose that aggregate demand increases such that the amount of real output demanded rises by $21 billion at each price level.

Instructions: Enter your answers as whole numbers.

a. By what percentage will the price level increase?  percent.

     Will this inflation be demand-pull inflation or will it be cost-push inflation? (Click to select)Cost-push inflationDemand-pull inflation.

b. If potential real GDP (that is, full-employment GDP) is $510 billion, what will be the size of the positive GDP gap after the change in aggregate demand? $ billion.

c. If the government wants to use fiscal policy to counter the resulting inflation without changing tax rates, would it increase government spending or decrease it? (Click to select)IncreaseDecrease.

Caspian Sea Drinks is considering the production of a diet drink. The expansion of the plant and the purchase of the equipment necessary to produce the diet drink will cost $27.00 million. The plant and equipment will be depreciated over 10 years to a book value of $2.00 million, and sold for that amount in year 10. Net working capital will increase by $1.34 million at the beginning of the project and will be recovered at the end. The new diet drink will produce revenues of $8.96 million per year and cost $1.64 million per year over the 10-year life of the project. Marketing estimates 19.00% of the buyers of the diet drink will be people who will switch from the regular drink. The marginal tax rate is 28.00%. The WACC is 14.00%. Find the IRR (internal rate of return).

Answer Format: Percentage Round to: 4 decimal places (Example: 9.2434%, % sign required. Will accept decimal format rounded to 6 decimal places (ex: 0.092434))