The company FPA has the following income, expense, and loss items for the current year.

Sales $850,000
Tax-exempt interest $40,000
Long-term capital gain $85,000
Short-term capital loss $35,000
Passive activity loss $20,000
Cost of goods sold $480,000
Depreciation $40,000
Section 179 expense $50,000
Other operating expenses $200,000
Net operating loss (from previous year) $24,000
Prepare a calculation of taxable income for the following scenarios and indicate the tax form(s) to report the business activity:
 Sole proprietorship
 Partnership equally owned by Vinnie and Chandra
 Corporation owned by Kim
 S corporation owned equally by Henry, Iris, and Jasmine

Primarily the Tax information for the S-corporation, under the most recent tax law

How do I calcuate the FIT for this question? My calculations are wrong..................

Assume during the quarter ending December 31 of the current year, Cox Security Systems had 13 weekly paydays and three monthly paydays. The names of the employees of Cox Security Systems and their regular salaries are shown in the following payroll register. Note that Hall and Short are paid monthly on the last payday, while all others are paid weekly.

*Monthly

In addition to the regular salaries, the company pays an annual bonus based on the amount of earnings for the year. For the current year, the bonus amounts to 8% of the annual salary paid to each employee. The bonus is to be paid along with the regular salaries on December 28, but the amount of the bonus and the amount of the regular salary will be shown separately on each employee's earnings statement. Assume that all employees received their regular salary during the entire year.

The payroll register for the period ending December 28th is shown reflecting the following for each employee:

The wage-bracket method is used to withhold federal income tax from the regular salaries.

A flat 25% is withheld on the annual bonus.

Total salaries and bonuses are subject to a 2% state income tax and a 1% city income tax.

For Period Ending December 28, 20--

Complete the following form to show:

a. Total earnings paid during the quarter, including both the regular and the supplemental earnings.

b. Total amount of FICA taxes withheld during the quarter.

c. Total amount of federal income taxes withheld during the quarter.

d. Total amount of state income taxes withheld during the quarter.

e. Total amount of city income taxes withheld during the quarter.

f. Total net amount paid each employee during the quarter.

When computing withholding, round each amount to the nearest cent. If applicable, use rounded amount in subsequent computations. And use final rounded amount to determine the total.

My answers:

Job Order Costing and T-accounts

Arnold Company makes cabinets to customer order. Arnold applies overhead at the rate of 20% of direct labor cost. Jobs are marked up at 30% over cost.

On July 1, Finished Goods inventory consisted of Job 68, costing $9,300. Work in Process inventory consisted of three jobs: Job 70 for $3,200, Job 71 for $1,400, and Job 72 for $700.

During the month of July, Arnold worked on six jobs with the following direct materials and direct labor for the month:

Jobs 70, 71, 73 and 74 were completed during July. Jobs 68, 70, 71 and 74 were sold. (All completed jobs are first transferred to Finished Goods, then to Cost of Goods Sold as they are sold.)

Fill in the following job cost sheet and calculate the total cost by July 31 for each job.

Enter the appropriate numbers to the correct T-accounts for Work-in-Process, Finished Goods and Cost of Goods Sold for each of the following: (Hint: when entering amounts for a transaction that includes more than one job, enter them in order of the job number. That is, if a transaction included amounts for Jobs 70 and 72, the amount for Job 70 would be entered before the amount for Job 72.)

Use the Interactive Graph to answer the following questions:

If direct labor added to Job 73 equaled $2,400, the ending balances of each of the following accounts would be affected in what way?

If the overhead rate based on direct labor was 40%, the ending balances of each of the following accounts would be affected in what way?

Instructions: Please make sure everything is correct if not correct and give correct calculation pls.

Absorption and Variable Costing Income Statements for Two Months and Analysis

During the first month of operations ended July 31, Head Gear Inc. manufactured 26,800 hats, of which 25,500 were sold. Operating data for the month are summarized as follows:

During August, Head Gear Inc. manufactured 24,200 designer hats and sold 25,500 hats. Operating data for August are summarized as follows:

Required:

1a. Prepare an income statement for July using the absorption costing concept. Enter all amounts as positive numbers.

1b. Prepare an income statement for August using the absorption costing concept. Enter all amounts as positive numbers.

2a. Prepare an income statement for July using the variable costing concept. Enter all amounts as positive numbers.

2b. Prepare an income statement for August using the variable costing concept. Enter all amounts as positive numbers.

3a. For July, income from operations reported under variable costing is less than absorption costing due to part of fixed manufacturing costs that are expensed.

3b. When large changes in inventory levels occur from one period to the next, it is possible for management to misinterpret such increases (or decreases) in income from operations as due to changes in:

costs.

prices.

sales volume.

"sales volume", "prices" and "costs" are correct.

None of these choices is correct.

The correct answer is:
d

4. Based on your answers to (1) and (2), did Head Gear Inc. operate more profitably in July or in August? Explain.

Head Gear Inc. was more profitable in July than Augustmore profitable in July than August under the variable costing concept. The difference in income reported under the absorption costing concept is due to allocating fixed manufacturing costs to the July 31 ending inventory .

Per unit data concerning a product manufactured by XYZ Co. are given below:

The above per unit data are based on annual production of 10,000 units. The company has received a special, one-time-only order for 500 units of the product with a selling price of $60. There would be no variable selling expense on this special order and the total fixed manufacturing overhead and total fixed selling and administrative expenses of the company would not be affected by the order. If XYZ accepts the order, it will have no effect on other customers. Assuming that XYZ has excess capacity and can fill the order without cutting back on the production of any product, what is the financial advantage (disadvantage) of company accepting the special order?

1. XYZ manufactures and sells a number of products, including Product G. Results for last year for the manufacture and sale of Product G are as follows:

   Sales		$50,000
   Less expenses:
   Variable costs	$40,000
   Fixed costs	36,000	76,000
   Net operating loss		$(26,000)

   XYZ is trying to decide whether or not to discontinue Product G. Two thirds of fixed costs are avoidable if the product is dropped. Assume that dropping Product G will have no effect on other products. What is the financial advantage (disadvantage) of dropping Product G?
   

   	A.	$14,000 financial advantage
   	B.	$26,000 financial advantage
   	C.	$2,000 financial advantage
   	D.	$40,000 financial advantage

2. Which of the following equation is NOT valid regarding spending variances shown in the flexible budget performance report?

   	A.	Total spending variance for fixed overhead = fixed overhead budget variance + fixed overhead volume variance.
   	B.	Total spending variance for direct labor = labor rate variance + labor efficiency variance.
   	C.	Total spending variance for variable overhead = variable overhead rate variance + variable overhead efficiency variance.
   	D.	Total spending variance for direct materials = material price variance + material quantity variance, if actual quantity purchased = actual quantity used.

3. Suppose a company applies variable manufacturing overhead to products on the basis of direct labor-hours. If the company’s labor efficiency variance is favorable, which of the following statement is TRUE?

   	A.	The company’s fixed overhead volume variance must be favorable as well.
   	B.	The company’s variable overhead rate variance must be favorable as well.
   	C.	The company’s labor rate variance must be favorable as well.
   	D.	The company’s variable overhead efficiency variance must be favorable as well.

Periwinkle plc manufactures Product X using three different raw materials. The product details are as follows:
i. Selling price per unit £250. Seventy-five percent of sales are collected in the first month and these customers receive a 0.5% discount. The remainder is collected in the following month.
ii. Direct labour per unit 8 hrs
iii. Labour rate 7.50 per hour
iv. Materials requirement per unit:
Material Required Price

A 3  kg $3.50 per kg
B 2 kg $5.00 per kg
C 4 kg $4.50 per kg
v. The company is considering its budgets for next year and has made the following
estimates of sales demand for Product X for July to October:
June 350 units
July 400 units
August 300 units
September 600 units
October 450 units
November 300 units
vi. It is company policy to hold stocks (inventories) of finished goods at the end of each month equal to 50 per cent of the following month’s sales demand.
vii. Raw material stocks (inventories) are expected to be 40% of the following month’s requirements. Material is paid for on a cash basis.
viii. Labour is paid on an hourly rate based on attendance. In addition to the unit direct labour hours shown above.
i$4.50 per kg
v. The company is considering its budgets for next year and has made the following
estimates of sales demand for Product X for July to October:
June 350 units
July 400 units
August 300 units
September 600 units
October 450 units
November 300 units
vi. It is company policy to hold stocks (inventories) of finished goods at the end of each
month equal to 50 per cent of the following month’s sales demand.
vii. Raw material stocks (inventories) are expected to be 40% of the following month’s
requirements. Material is paid for on a cash basis.
viii. Labour is paid on an hourly rate based on attendance. In addition to the unit direct
labour hours shown above.

Overheads for the period are expected to be:
Variable Overheads
Production $40 per unit
Selling and Administration $35 per unit
Fixed Overheads (monthly)

Production overheads $10 000 (including $3000 depreciation)

Selling and Administration $4000 (including $300 depreciation)

x. In September, Periwinkle plans to dispose of machinery. This is expected to realize $15 000. This machinery will be replaced in August with a new piece of

equipment at a cost of $45 000, to be paid in two equal instalments in August and September.

xi. The company will receive a tax refund of $6 000 Equipment.

xii. Periwinkle’s policy is to maintain a minimum cash balance of $10 000. The company can draw down (In multiples of $1 000) on a line of credit at a rate of $15%

per annum. This is repaid when there is surplus cash. Borrowing occurs on the first day of the month, repayments are made on the last day of the month.
Requirements:
a) Prepare the following budgets for the quarter from July to September inclusive:
i. Sales budget
ii. Schedule of cash collections
iii. Production budget in units
iv. Raw material purchases budget in kgs and value
v. Labour requirements budget in hours and value.
vi. Production overhead budget
vii. Selling and Administration Budget
viii. Cash budget

Tandy, Inc. is in the business of manufacturing men’s and women’s leather computer bags. On January 1, 2019 they started their new fiscal year. The following is their trial balance as of December 31, 2018:

       Account                      Dr                 Cr

       Cash                                   $   43,200

       Accounts Receivable                 $     9,000

       Raw Materials Inventory (1)       $    20,240

       Work in Process Inv. (2)                     $            0

       Finished Goods Inv. (3)               $     8,100

       Land                                   $ 225,000

       Equipment                         $ 310,000

       Vehicles                      $   84,200

       Accumulated Depreciation                             $     55,100

       Long-term Investments              $   78,500

       Accounts Payable                                    $     14,700

       Wages Payable                                               $       8,470

       Mortgage Payable (4)                                      $   214,500

       Common Stock (5)                                   $     25,000

       APIC                                                       $ 125,000

       Retained Earnings                                    $   335,470

              Totals                          $    778,240             $   778,240

1. Includes 2,860 feet of leather at $4 per foot, 5,000 feet of nylon lining at $1.25 per foot, and 510 golden buckles at $5 per buckle

2. No bags are currently in process at the beginning of January

3. Includes 150 completed bags (manufacturing overhead has been applied)

4. Monthly payments (interest and principle) are $ 2,500

5. $0.10 par value, 300,000 share authorized and 250,000 share outstanding

For the coming year, you have been put in charge of creating the operational budget schedules and the cash budget. Below is information for the first three months of the fiscal year.

Sales Forecasts

For this coming year, you have raised your sales price to $205 per bag. Based on sales contracts you have signed with your major corporate customers, you anticipate the following sales for the first three months of 2019:

       January         250 bags

       February 225 bags

       March           190 bags

According to the terms of the sales contracts you require each customer to pay 80% of the sales price in the month of sale and 20% in the month following. In December 2018, Tandy had $30,000 in total sales.

The production process

Each bag produced requires 4 feet of leather, 9 feet of nylon, 3 gold buckles, and 3.5 hours of direct labor. Currently you are paying your assembly workers $17 / hour (all wages are paid in the quarter they are incurred). In order to meet the following month’s demand, Tandy desires to keep 45% of the next month’s sales in Finished Goods Inventory. Tandy is forecasting sales in April, 2019 of 285 bags. Additionally, they also keep 30% of next month’s production needs in raw materials inventory. Tandy anticipates production of 255 units in April, 2019. Tandy has signed contracts with their suppliers to purchase leather at $4 a foot and buckles at $5 per buckle for the following year. Their policy is to pay for 75% of raw materials at the time of purchase and the remaining 25% in the following month. Tandy incurred $ 8,000 of total materials purchases in December of 2018.

Selling, General and Administrative Expenses

Tandy anticipates the following expenses for January through March (all expenses are fixed and stated in the aggregate for all three months):

       Sales & Delivery                 $ 12,500

       Executive’s Salaries            $ 44,100

       Advertising Expenses          $   5,500

       Mortgage Payments            $   7,500

       Utilities on Admin offices    $   4,500

Required :Please complete the entire operational budget using Microsoft Excel

What is the projected ending cash balance in March?

Notes: Please list out the working process.

Your company is considering to take a loan from the local bank.

Bank charges a 1.25% interest rate per quarter.

Then the rate 1.25*4 =5% is called ____