An analysis of the accounts of Crane Company reveals the
following manufacturing cost data for the month ended September 30,
2020.
| Inventories | Beginning | Ending | ||
| Raw materials | $12,700 | $10,300 | ||
| Work in process | 7,700 | 5,300 | ||
| Finished goods | 10,800 | 12,600 |
Costs incurred: raw materials purchases $62,300, direct labor
$48,200, manufacturing overhead $26,900. The specific overhead
costs were: indirect labor $6,000, factory insurance $4,900,
machinery depreciation $6,400, machinery repairs $2,800, factory
utilities $3,900, miscellaneous factory costs $1,770. Assume that
all raw materials used were direct materials.
Prepare the cost of goods manufactured schedule for the month ended September 30, 2020.
In: Accounting
Required information
In 2018, the Westgate Construction Company entered into a contract
to construct a road for Santa Clara County for $10,000,000. The
road was completed in 2020. Information related to the contract is
as follows:
| 2018 | 2019 | 2020 | |||||||
| Cost incurred during the year | $ | 2,156,000 | $ | 3,388,000 | $ | 2,371,600 | |||
| Estimated costs to complete as of year-end | 5,544,000 | 2,156,000 | 0 | ||||||
| Billings during the year | 2,130,000 | 3,414,000 | 4,456,000 | ||||||
| Cash collections during the year | 1,865,000 | 3,300,000 | 4,835,000 | ||||||
Westgate recognizes revenue over time according to percentage of
completion.
3. Complete the information required below to
prepare a partial balance sheet for 2018 and 2019 showing any items
related to the contract. (Do not round intermediate
calculations.)
In: Accounting
On December 31, 2018, Kohl Company performed engineering consulting services for Hemingway, Inc. Hemingway was short of cash, and Kohl Co. agreed to accept a $200,000 zero-interest-bearing note due December 31, 2020, as payment in full. Hemingway is somewhat of a credit risk and typically borrows funds at a rate of 10%. Kohl is much more creditworthy and has various lines of credit at 6%.
Prepare the following journal entries for Kohl Co.:
(a) Prepare the journal entry to record the transaction of December 31, 2018
(b) Prepare the adjusting journal entry for December 31, 2019
(c) Prepare the adjusting journal entry and the collection of the note for December 31, 2020
Please show supporting computations.
In: Accounting
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In: Accounting
The Burger Division of Good Meat Company reported the following results for 2020: Sales $800,000 Variable costs 420,000 Controllable fixed costs 100,000 Average operating assets 4,000,000 Management is considering the following independent alternative courses of action in 2021 in order to maximize the return on investment for the division 1. Reduce controllable fixed costs by 50% with no change in sales or variable costs 2 Reduce average operating assets by 30% with no change in control margin 3. Increase sales $200,000 with no change in the contribution margin percentage Required a) Calculate the return on investment for 2020 b) Calculate the expected return on investment for each of the alternative courses of action Show all your work
In: Accounting
The December 31, 2020 inventory of Ivanhoe Company consisted of
four products, for which certain information is provided
below.
| Product | Original Cost | Replacement Cost |
Estimated Disposal Cost |
Expected Selling Price |
Normal Profit on Sales |
||||||||||
| A | $29.00 | $27.00 | $5.50 | $42.00 | 25.00% | ||||||||||
| B | $41.00 | $39.00 | $9.00 | $49.00 | 20.00% | ||||||||||
| C | $148.00 | $143.00 | $22.00 | $185.00 | 20.00% | ||||||||||
| D | $20.00 | $14.70 | $5.00 | $26.00 | 20.00% | ||||||||||
Using the lower-of-cost-or-market approach applied on an
individual-item basis, compute the inventory valuation that should
be reported for each product on December 31, 2020.
(Round answers to 2 decimal places, e.g.
52.75.)
| Product | ||
| A | $ | |
| B | $ | |
| C | $ | |
| D | $ |
In: Accounting
MSK Construction Company contracted to construct a factory building for $525,000. Construction started during 2019 and was completed in 2020. Information relating to the contract follows:
| 2019 | 2020 | ||||||
| Costs incurred during the year | $ | 290,000 | $ | 150,000 | |||
| Estimated additional cost to complete | 145,000 | — | |||||
| Billings during the year | 260,000 | 265,000 | |||||
| Cash collections during the year | 240,000 | 285,000 | |||||
Required:
Record the preceding transactions in MSK’s books assuming it recognizes revenue over time and uses costs incurred to measure the extent to which its performance obligation has been satisfied.
Record the preceding transactions in MSK’s books assuming it recognizes revenue at a point in time when control of the completed factory is transferred to the customer at the end of the project.
In: Accounting
Mr Ahmed Kumar runs a snack distribution business located in the Light Industrial area in Lusaka. The following list of balances was extracted from his ledger as at 31 March, 2020; the end of his most recent financial year.
K
Capital 83,887
Sales 259,870
Trade accounts payable 19,840
Returns outwards 13,407
Allowance for doubtful debts 512
Discounts allowed 2,306
Discounts received 1,750
Purchases 135,680
Returns inwards 5,624
Carriage outwards 4,562
Drawings 18,440
Carriage inwards 11,830
Rent, rates and insurance 25,973
Heating and lighting 11,010
Postage, stationery and telephone 2,410
Advertising 5,980
Salaries and wages 38,521
Bad debts 2,008
Cash in hand 534
Cash at bank 4,440
Inventory as at 1st April 2019 15,654
Trade accounts receivable 24,500
Fixtures and fittings - at cost 120,740
Prov. for depreciation on fixtures and fittings – 31/03/2020 63,020
Depreciation 12,074
The following additional information as at 31st March, 2020 is available:
(a) Inventory at the close of business was valued at K17,750
(b) Insurances have been prepaid by K1,120
(c) Heating and lighting is accrued by K1,360
(d) Rates have been prepaid by K5,435
(e) The allowance for doubtful debts is to be adjusted so that it is 3% of trade accounts receivable.
Required:
For the year 2020, prepare Mr Kumar’s:
[10 Marks]
[10 Marks]
[10 Marks]
[10 Marks]
[Total: 40 Marks]
In: Accounting
The following information is available about Ancora Co. (Ancora): 1. Ancora's cash balance on December 31, 2019, was $70,000. 2. Actual sales for November and December 2019, and expected sales for January and February 2020, are as follows: November 2019 December 2019 January 2020 February 2020 (actual) (actual) (estimate) (estimate) Cash sales $ 75,000 $ 90,000 $ 60,000 $ 50,000 Credit sales 560.000 650,000 480,000 430,000 Sales on account are collected over a three-month period at the following rate: 30% collected in the month of sale, 50% collected in the month following sale and 17% collected in the second month following sale. The remaining 3% is uncollectable and is written off 3. Ancora's gross profit on sales is 35%. 4. Ancora's policy is to hold inventory at the end of the month equal to 40% of next month's budgeted sales. Inventory purchases in a given month are paid for as follows: 30% are paid in the month of purchase and 70% in the month following 5. Selling and administrative expenses are budgeted at $400,000 for January 2020. This amount includes $120,000 for depreciation 6 Equipment costing $150 000 was expected to be purchased for cash during January 2020 7 On December 15, 2019. Ancora declared a $100.000 dividend to be paid on January 15, 2020 8 Ancora must maintain a minimum cash balance of $50.000 An open line of credit is available from Ancora's bank. REQUIRED: Prepare Ancora's cash budget for the month of Jan 2020 and calculate Ancora's budgeted account receivable and accts payable closing balance at Jan 31, 20.
PLEASE PROVIDE TYPE WRITTEN ANSWER AND NOT HAND-WRITTEN SINCE IT'S HARD TO UNDERSTAND HAND WRITING.
In: Accounting
Mr Ahmed Kumar runs a snack distribution business located in the Light Industrial area in Lusaka. The following list of balances was extracted from his ledger as at 31 March, 2020; the end of his most recent financial year.
K
Capital 83,887
Sales 259,870
Trade accounts payable 19,840
Returns outwards 13,407
Allowance for doubtful debts 512
Discounts allowed 2,306
Discounts received 1,750
Purchases 135,680
Returns inwards 5,624
Carriage outwards 4,562
Drawings 18,440
Carriage inwards 11,830
Rent, rates and insurance 25,973
Heating and lighting 11,010
Postage, stationery and telephone 2,410
Advertising 5,980
Salaries and wages 38,521
Bad debts 2,008
Cash in hand 534
Cash at bank 4,440
Inventory as at 1st April 2019 15,654
Trade accounts receivable 24,500
Fixtures and fittings - at cost 120,740
Prov. for depreciation on fixtures and fittings – 31/03/2020 63,020
Depreciation 12,074
The following additional information as at 31st March, 2020 is available:
(a) Inventory at the close of business was valued at K17,750
(b) Insurances have been prepaid by K1,120
(c) Heating and lighting is accrued by K1,360
(d) Rates have been prepaid by K5,435
(e) The allowance for doubtful debts is to be adjusted so that it is 3% of trade accounts receivable.
Required:
For the year 2020, prepare Mr Kumar’s:
[10 Marks]
[10 Marks]
[10 Marks]
[10 Marks]
[Total: 40 Marks]
In: Accounting