During the last week of August, Oneida Company’s owner approaches the bank for a $101,000 loan to be made on September 2 and repaid on November 30 with annual interest of 16%, for an interest cost of $4,040. The owner plans to increase the store’s inventory by $60,000 during September and needs the loan to pay for inventory acquisitions. The bank’s loan officer needs more information about Oneida’s ability to repay the loan and asks the owner to forecast the store’s November 30 cash position. On September 1, Oneida is expected to have a $4,500 cash balance, $131,400 of net accounts receivable, and $100,000 of accounts payable. Its budgeted sales, merchandise purchases, and various cash disbursements for the next three months follow. Budgeted Figures* September October November Sales $ 230,000 $ 475,000 $ 460,000 Merchandise purchases 225,000 200,000 196,000 Cash payments Payroll 19,900 21,900 24,600 Rent 11,000 11,000 11,000 Other cash expenses 34,400 29,800 21,400 Repayment of bank loan 101,000 Interest on the bank loan 4,040 *Operations began in August; August sales were $180,000 and purchases were $100,000. The budgeted September merchandise purchases include the inventory increase. All sales are on account. The company predicts that 27% of credit sales is collected in the month of the sale, 44% in the month following the sale, 22% in the second month, 6% in the third, and the remainder is uncollectible. Applying these percents to the August credit sales, for example, shows that $79,200 of the $180,000 will be collected in September, $39,600 in October, and $10,800 in November. All merchandise is purchased on credit; 90% of the balance is paid in the month following a purchase, and the remaining 10% is paid in the second month. For example, of the $100,000 August purchases, $90,000 will be paid in September and $10,000 in October. Required: Prepare a cash budget for September, October, and November. (Round your final answers to the nearest whole dollar.)

On October 1, 20Y6, Jay Crowley established Affordable Realty, which completed the following transactions during the month:

The controller of Bridgeport Housewares Inc. instructs you to prepare a monthly cash budget for the next three months. You are presented with the following budget information:

The company expects to sell about 10% of its merchandise for cash. Of sales on account, 70% are expected to be collected in the month following the sale and the remainder the following month (second month following sale). Depreciation, insurance, and property tax expense represent $8,000 of the estimated monthly manufacturing costs. The annual insurance premium is paid in January, and the annual property taxes are paid in December. Of the remainder of the manufacturing costs, 80% are expected to be paid in the month in which they are incurred and the balance in the following month.

Current assets as of September 1 include cash of $36,000, marketable securities of $51,000, and accounts receivable of $105,800 ($83,000 from July sales and $22,800 from August sales). Sales on account for July and August were $76,000 and $83,000, respectively. Current liabilities as of September 1 include $8,000 of accounts payable incurred in August for manufacturing costs. All selling and administrative expenses are paid in cash in the period they are incurred. An estimated income tax payment of $14,000 will be made in October. Bridgeport’s regular quarterly dividend of $8,000 is expected to be declared in October and paid in November. Management desires to maintain a minimum cash balance of $35,000.

Required:

1. Prepare a monthly cash budget and supporting schedules for September, October, and November. Input all amounts as positive values except overall cash decrease and deficiency which should be indicated with a minus sign. Assume 360 days per year for interest calculations.

The Polaris Company uses a job-order costing system. The following data relate to October, the first month of the company’s fiscal year. a. Raw materials purchased on account, $210,000. b. Raw materials issued to production, $191,000 ($152,800 direct materials and $38,200 indirect materials). c. Direct labor cost incurred, $49,000; indirect labor cost incurred, $20,000. d. Depreciation recorded on factory equipment, $105,000. e. Other manufacturing overhead costs incurred during October, $130,000 (credit Accounts Payable). f. The company applies manufacturing overhead cost to production on the basis of $8 per machine-hour. A total of 76,300 machine-hours were recorded for October. g. Production orders costing $511,000 according to their job cost sheets were completed during October and transferred to Finished Goods. h. Production orders that had cost $453,000 to complete according to their job cost sheets were shipped to customers during the month. These goods were sold on account at 26% above cost.

Required: 1. Prepare journal entries to record the information given above

(1.a) Record the journal entry for purchase of raw material as given below:

(1.b) Journal entry for the issuance of material for production as given below:

(1.c) Journal entry for direct and indirect labor cost incurred as given below:

(1.d) Journal entry for recording depreciation as given below:

(1.e) Journal entry for manufacturing overheads incurred as given below:

1.f) Journalize the transaction of overheads absorbed as given below:

(1.g) Journal entry for finished goods as given below:

(1.h)Journal entry for finished goods available for sale as given below:

Each of the following scenarios describes a correlation between two variables. State whether the correlation is most likely due to a coincidence, a common underlying cause, or a direct cause. If there is an underlying cause, state what you think it is. If you believe that one variable directly causes the other, suggest possible physical causation.

1. Sales of winter boots are positively correlated with the sale of sidewalk salt.

2. I’ve noticed that the more hours I work each week, the more “Happy Meals” toys (from McDonald’s Restaurants) we collect at home.

3. A Kindergarten teacher noted that the amount of money he spends on art supplies each year is positively correlated with the amount he spends buying snacks for the class.

4. If I remember to bring my umbrella to work it doesn’t rain, but if I forget it at home it does. Sigh.

5. A large company notices that since it changed to more flexible hours, its absentee rate has fallen dramatically.

6. My neighbor the roofer hates when it rains. He says that the more days it rains, the less he earns a year.

7. The day on which we begin daylight savings time each fall was recently changed from mid-fall to early November and candy companies nationwide reported higher than usual sales in October.

8. People who drive red cars get caught speeding more often than those who drive other color cars.

9. Augsburg’s women’s hockey team wins more games when the three captains play.

10. The divorce rate in Maine is closely correlated to the per capita consumption of margarine in the United States. (This is actually a strong positive correlation.)

Exercise 13-13 - Topic - Non Financial and Current Liabilities

Ayayai Corporation offers enriched parental benefits to its staff. While the government provides compensation based on Employment Insurance legislation for a period of 12 months, Ayayai increases the amounts received and extends the period of compensation. The benefit program tops up the amount received to 100% of the employee’s salary for the first 12 months, and pays the employee 70% of his or her full salary for another 6 months after the EI payments have stopped.
Zeinab Jolan, who earns $52,000 per year, announced to her manager in early June 2020 that she was expecting a baby in mid-November. On October 29, 2020, 9 weeks before the end of the calendar year and Ayayai’s fiscal year, Zeinab applied for and began her 18-month maternity leave. Assume that the Employment Insurance program pays her a maximum of $720 per week for 52 weeks.
For the purpose of this question, ignore any tax, CPP, and EI deductions when making payments to Zeinab.

A.) Prepare all entries that Ayayai Corporation must make during its 2020 fiscal year related to the parental benefits plan in regard to Zeinab Jolan.

B.) Prepare one entry to summarize all entries that the company will make in 2021 relative to Zeinab Jolan’s leave.

C.) Calculate the amount of parental benefits payable at December 31, 2020, and 2021.

Explain how these amounts will be shown on Ayayai’s SFP. (Round answers to 0 decimal places, e.g. 5,275.)