Journal entries

November 9 The business purchased building worth $75000; paying $15,000 cash and the bank financed the balance with a note for 10 years at 9% annual interest rate. Interest is payable annually on november 1st of each year. The principal will be paid when the note matures.

November 11The Company purchased Copier, Computer, and Printer from Office Equipment, Inc. for $35,000. Terms are 2/10, n/30.

November 14 Purchased merchandise inventory from Madison Supply Company $15,000 on account. Credit term: 2/10, n/30.

November 14 Contracted with Truly Blessed, Inc. on Windsor Drive. The deal terms are: the business performs Accounting and Bookkeeping services, at a weekly rate of $3,500 per week. The customer gave the business a deposit on the contract of $6,500. Services start 15th of November 2020.

November 14 Hired Betsy Green at the rate of $700 per 5-day week (Monday - Friday), to be paid bi-weekly. Green will start work on November 16th.

November 15 Received accounting and bookkeeping contract from LittleTot Day Care, work starts November 16th. Terms are n/30.

November 17 The business borrows $20,000 from the Berks County bank; interest rate is 5% due 18 months from now.

November 18 The business joined Professional Associations of Bookkeepers. Membership dues paid $3,200 for 1 year.

November 20 Paid the amount due to Madison Supply Company

November 21 Ordered $1,000 of Office Supplies from Supplies We Are, Inc. The supplies will be delivered second week of December.

November 22 Performed accounting service to a client on account $20,000.

November 24 Received utility bill from Gas Company for the month and paid immediately $650.

November 25 Returned $450 of office supplies purchased on March 3 to We-Know-You Supplies, Inc. Vendor issued a credit memo to reduce the amount due on account.

November 26 Paid Betsy Green’s salary, for the first 2 weeks of work.

November 27 Received April Electric Bill from Reading Energy company, $650.

November 27Received payments in full from Fit-for-U Beauty Shop.

Novemer 27 Paid We-Know-You Supplies, Inc. account balance.

November 31 Sold 575 units of inventory item to a customer at $60 each for cash (cost $20 each). Assume the company uses a perpetual inventory system. This transaction requires two journal entries.

Thirty years ago, Starbucks was a single store in Seattle’s Pike Place Market selling premium roasted coffee. Today it is a global roaster and retailer of coffee with some 13,000 stores, more than 3,750 of which are to be found in 38 foreign countries. The strategy of its owner was to sell to the company’s own premium roasted coffee and freshly brewed espresso-style coffee beverages, along with a variety of pastries, coffee accessories, teas and other products, in a tastefully designed coffeehouse setting.

In 1995, with 700 stores the United States, Starbucks began exploring foreign opportunities. Its first target market was Japan. Although Starbucks had resisted a franchising strategy in North America, where its stores are company owned, Starbucks initially decided to license its format in Japan. However, the company also realized that a pure licensing agreement would not give it the control needed to ensure that the Japanese licenses’ closely followed Starbucks’ successful formula.

So the company established a joint venture with a local retailer, Sazaby Inc. Each company held a 50% stake in the venture, Starbucks Coffee of Japan. Starbucks initially invested $10 million in this venture, its first foreign direct investment. The Starbucks format was then licensed to the venture, which was charged with taking over responsibility for growing Starbucks’ presence in Japan.

After Japan, the company embarked on an aggressive foreign investment program. In 1998, it purchased Seattle Coffee, a British coffee chain with 60 retail stores, for $84 million. In Asia, Starbucks’ most common strategy was to license its format to a local operator in return for initial licensing fees and royalties on store revenues.

In 2006, Starbucks announced that it believed there was the potential for up to 15, 000 stores outside of the United States, with major opportunities in China, which the company now views as the largest single market opportunity outside of the United States. Currently the company only has 350 stores in China.

1. What could be the main reason that triggered Starbucks to pursue FDI in Britain? .

2. Starbucks decided to pursue international investment through licensing, what would be the cause of that? .

3. Assess the reasons why Starbucks chose to embark on a foreign market expansion strategy outside of the USA.

4. In your opinion what type of international business activity should have Starbucks used? Explain your answer.

11. Tybee Industries Inc. uses a job order cost system. The following data summarize the operations related to production for January, the first month of operations:

General Ledger

1. Journalize the entries to record the summarized operations. Record each item (items a-f) as an individual entry on January 31. Record item g as 2 entries. Refer to the Chart of Accounts for exact wording of account titles.

A large company has hired your friend. She confides in you about a problem with her boss. Her boss has asked customers to sign sales agreements just before the end of the year, indicating a sale has been made. Her boss has told these customers that he will give them 30 days, which is Page 489 well into next year, to change their minds. If they do not change their minds, then he will send the merchandise to them. If they do change their minds, her boss has agreed to cancel the orders, take back the merchandise, and cancel the invoices. Her boss has given the sales agreements to the Accounting Department, which has prepared invoices and recorded the sales. One of the people in accounting is keeping the invoices and shipping documents for these customers in a desk drawer either until the customers change their minds, in which case the sale will be canceled, or until the merchandise is sent at the end of the 30-day waiting period. Questions 1. Does this sales policy violate ANY of GAAP's rules? 2. Does this sales policy violate any legal statutes at the state or Federal level? If so, relate them to the act under consideration in this case. If not, state why not.

Operating cash inflows   Strong Tool Company has been considering purchasing a new lathe to replace a fully depreciated lathe that would otherwise last 5 more years. The new lathe is expected to have a​ 5-year life and depreciation charges of $2,020 in Year​ 1; $3,232 in Year​ 2; $1,919 in Year​ 3; $1,212 in both Year 4 and Year​ 5; and $505

in Year 6. The firm estimates the revenues and expenses​ (excluding depreciation and​ interest) for the new and the old lathes to be as shown in the following table

The firm is subject to a 40% tax rate on ordinary income.

a. Calculate the operating cash inflows associated with each lathe.​ (Note: Be sure to consider the depreciation in year​ 6.)

b. Calculate the operating cash inflows resulting from the proposed lathe replacement.

c. Depict on a time line the incremental operating cash inflows calculated in part b.

a. Calculate the operating cash inflows associated with the new lathe​ below:  ​(Round to the nearest​ dollar.)

​(Round to the nearest​ dollar.)

​(Round to the nearest​ dollar.)

​(Round to the nearest​ dollar.)

​(Round to the nearest​ dollar.)

Calculate the operating cash inflows associated with the old lathe​ below:  ​(Round to the nearest​ dollar.)

puts these designs into production by locating half its production facilities nearby in Spain, Portugal, and Morocco. It produces only a small quantity of each collection and is willing to experience occasional shortages to preserve an image of exclusivity. Clothes with a longer shelf life, like T-shirts, are outsourced to lower-cost suppliers in Asia and Turkey. With tight control on its manufacturing process, Zara can move more rapidly than any of its competitors and continues to deliver fresh styles to its stores every week. Logistics. Zara distributes all its merchandise, regardless of origin, from Spain. Its distribution process is designed so that the time from receipt of an order to delivery in the store averages 24 hours in Europe and 48 hours in the United States and Asia. Having 50 percent of its production facilities nearby is key to the success of this model. All Zara stores receive new shipments twice a week, and the small quantities of each collection entice consumers not only to return frequently but also to make purchase decisions more quickly. Because of its logistics and inventory policy, while an average shopper in Spain visits a main street store three times a year, shoppers to a Zara store average 17 trips. Some fans know exactly what day new shipments arrive and show up early to be the first in line, keeping the company’s sales strong throughout the year and even during slow economic times. The company also sells more products at full price—85 percent of its merchandise versus the industry average of 60 percent. Customers. Everything revolves around Zara’s customers. The retailer monitors customers’ changing needs, trends, and tastes through daily reports from shop managers about which products and styles have sold and which haven’t. Managers earn as much as 70 percent of their salaries from commission, so they have a strong incentive to stay on top of things. Zara’s designers don’t have to predict what fashion trends will be in the future. They react to customer feedback—good and bad—and if an idea fails, the line is withdrawn immediately. Zara cuts its losses and the impact is minimal due to the small quantities of each style produced. Stores. Zara does not run advertising campaigns. The retailer’s stores, in prestigioushigh-traffic locations around the world, are its key advertising element, featuring stylish and constantly changing window displays. Other retailers spend 3 percent to 4 percent of revenues on big brand-building campaigns, while Zara spends just 0.3 percent. The company has said it would rather use a percentage of revenue to open new stores than to advertise. Zara’s success comes from having complete control over all the parts of its business—design, production, and distribution. Louis Vuitton’s fashion director, Daniel Piette, described the company as “possibly the most innovative and devastating retailer in the world.” It has expanded aggressively throughout Europe as well as into emerging markets such as Asia, the Americas, and the Middle East, making sure it honors local tastes in each region. Zara was a latecomer to the Internet and launched its first online store only in 2011. However, the company now uses its Web site to test the waters before entering potential markets like China, Russia, and Canada with retail storefronts. While Zara has experience record sales as of late, it faces unique challenges ahead, including what to do in the United States, where obesity rates are much higher than in the rest of the world and roomy clothes are preferred to the slim fits and high fashion the company offers. It also needs to decide how to maintain its tight control on manufacturing as it expands throughout the world. Questions 1. Would Zara’s model work for other retailers? Why or why not? 2. What can Zara do to ensure successful growth around the world while maintaining the same level of speed and instant fashion?

Find the duration of a bond with a settlement date of May 27, 2020, and maturity date November 15, 2031. The coupon rate of the bond is 7.5%, and the bond pays coupons semiannually. The bond is selling at a bond-equivalent yield to maturity of 5.5%. Use Spreadsheet 16.2. (Do not round intermediate calculations. Round your answers to 4 decimal places.)

There is a hill 600 feet tall the slope of the road originally has a 27% grade(slope) and it is decreased to 14% to make it a legal road in the town. legal roads have a 12-15% grade maximum. Find the length of the new road and the percentage increase between the old and new road