Preparing Bank reconciliation & any journal entries;

The following information is for Neopolitan Ltd in July

1.Cash balance per bank, July 31, $10,670

2. Cash balance per general ledger cash account, July 31, $8,953

3. Bank Service Charge, $40

4. Deposits in Transit, $1,968

5. Electronic receipts from customers in payment of their accounts, $1,276, not previously recorded by the company

6. Outstanding cheques, $2,359

7. Cheque #373 was correctly written in the amount of $890 but was incorrectly recorded by the company’s bookkeeper at $980.

Instructions

a) Prepare the bank reconciliation at July 31

b) Prepare any journal entries required from the reconciliation

aaaaa bonded company reported the following on its 12/31/2017 financial statements:

Accounts Receivable (net of a $16,000 Allowance) of $104,000

Consider that during 2018 Layer Cake accrued bad debt at 3% of credit sales, reported actual customer write offs of $21,000, credit sales of $800,000, and cash collections from customers as payment on account of $789,000. Additionally, the controller determined (from a detailed 12/31 aging analysis) that it would be appropriate to report the receivables on the 12/31/2018 balance sheet at a net realizable value of $88,000. What value will Layer Cake report as bad debt expense for the twelve months ended at 12/31/2018?

1.

artificial price used when goods or services are transferred from one segment of the company to another.

2.

Income -(investment x cost of capital percentage)

3.

What is a balanced scorecard?

4.

When preparing the cash budget, what should be considered?

Please solve by hand

A company is investing in a new expansion project which will cost $180,000 paid over 3 equal payments of $60,000. one payment is due now, one at the end of the first year and one at the end of the 2nd year. The project will start generating revenues of $44,000 per year at the end of the third year and up to and including the 10th year. Minimum Acceptable Rate of Return (MARR) = 8%. Please note that because this project is an investment, MARR provides the mathematical interest rate used for calculations (i).

a) Draw the cash flow diagram (CFD) for this investment showing cost and revenue components of the CFD.

b) If all the initial costs needed for this investment are to be financed from a line of credit. What is remarkable about a line of credit, as opposed to a loan, is that you can borrow the money whenever you want. Interest will only accrue after you borrow. The credit limit will always be available, even if you choose not to use it. That is, money can be borrowed whenever needed from an account up to $500,000.

Find the maximum interest rate for this line of credit so that the project is feasible. The company decided to pay back this money to the line of credit as a lump sum (one payment) at the end of the project (whenever the last revenue is received.

The Nederlander Organization is a theatrical organization that owns concert venues and Broadway theaters. Nederlander describes itself as a lifestyle company, which puts them in a specific niche with a specific type of customer. The organization engages in promotional activities for various concerts as well as production of Broadway shows. Nederlander Organization has leveraged these relationships with their Audience Rewards program, a type of sales promotion that has allowed them to build strong relationships with customers by enhancing their experience. The unique nature of the industry and smaller size of their target market allow Nederlander to create a valuable experience for customers through personal selling and sales promotion activities. The Audience Rewards is similar to a frequent-flyer program. Nederlander’s sales promotion program strongly benefits smaller venues. The Audience Rewards program also depends on outside relationships with major companies that sponsor the rewards for the program. Nederlander’s target market is an attractive opportunity for large companies. A market dominated by 30- to 59-year-old females with an annual income of approximately $200,000 appeals to their corporate partners because they want to get access to their customers. In addition to the many benefits of this program, sales promotion has provided Nederlander Organization with a competitive advantage over other companies. Questions for Discussion 1. Why do you think more targeted promotional efforts such as personal selling and sales promotion are necessary for Nederlander’s specific target market? 2. How does Nederlander’s Audience Rewards program result in a competitive advantage? 3. Describe how Nederlander’s strong customer relationship management results in increased loyalty to the organization.

Kaila Company’s Body Lotion Division produces a body lotion that is used by manufacturers of various body butter products. Sales and cost data on the body lotion follow:

Selling price per unit on the intermediate market . . . . . . . . .$70

Variable costs per unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $45

Fixed costs per unit (based on capacity) . . . . . . . . . . . . . . . $10

Capacity in units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,000

Number of body lotion:

Produced during the year . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,000

Sold to outside customers . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,000

Kaila Company has a Body Butter Division that could use this body lotion in one of its products. The

Body Butter Division will need 5,000 body lotions per year. It has received a quote of $60 per body lotion

from another manufacturer.

Required:

1. Assume that the Body Lotion Division is now selling only 20,000 body lotions per year to outside

customers. Can the selling division and buying division negotiate for the transfer price? Calculate the lower and upper acceptable transfer price!

2. Assume that the Body Lotion Division is selling 28,000 of the body lotions it can produce to outside

customers. Can the selling division and buying division negotiate for the transfer price? Calculate the lower and upper acceptable transfer price!

3. Assume that the Body Lotion Division selling all the speackers at cost to Body Butter Division. Can they still get profit for their divison? Which one is better, negotiated transfer price or transfer at cost for the selling division?

1. The following differences enter into the reconciliation of financial income and taxable income of Abbott Company for the year ended December 31, 2020, its first year of operations. The enacted income tax rate is 20% for all years.

         Pretax accounting income                                                                  $800,000

         Excess tax depreciation                                                                      (480,000)

         Litigation accrual                                                                                      70,000

         Unearned rent revenue deferred on the books but appropriately

               recognized in taxable income                                                            60,000

         Interest income from New York municipal bonds                           (20,000)

         Taxable income                                                                                    $430,000

1.   Excess tax depreciation will reverse equally over a four-year period, 2021-2024.

2.   It is estimated that the litigation liability will be paid in 2024.

3.   Rent revenue will be recognized during the last year of the lease, 2024.

4.   Interest revenue from the New York bonds is expected to be $20,000 each year until their maturity at the end of 2024.

(a)   Prepare a schedule of future taxable and (deductible) amounts.

(b)   Prepare a schedule of the deferred tax (asset) and liability at the end of 2020.

(c)   Since this is the first year of operations, there is no beginning deferred tax asset or liability. Compute the net deferred tax expense (benefit).

(d)   Prepare the journal entry to record income tax expense, deferred taxes, and the income taxes payable for 2020.