Company is in the process of preparing its budget for next year. Cost of goods sold has been estimated at 60 percent of sales. Merchandise purchases are to be made during the month preceding the month of the sales. Button pays 60 percent in the month of purchase and 40 percent in the month following. Wages are estimated at 20 percent of sales and are paid during the month of sale. Other operating costs amounting to 10 percent of sales are to be paid in the month following the sale.
Month Sales Revenue
December $170,000
January 250,000
February 120,000
March 200,000
April 160,000
Prepare a schedule of cash disbursements for January, February, and March
In: Finance
Millstone Company produces only one product. Normal capacity is 20,000 units per year, and the unit sales price is $5. Relevant costs are: Unit Variable Cost Total Fixed Cost Materials $1.00 Direct labor 1.20 Factory Overhead 0.50 $15000 Marketing expenses 0.30 5000 Administrative expenses 6000
Required: Compute the following: (1) The break-even point in units of product
(2) The break-even point in dollars of sales
(3) The number of units of product that must be produced and sold to achieve a profit of $10,000
(4) The sales revenue required to achieve a profit of $10,000
In: Accounting
1) An economy is facing a recession. The gap is $20 billion and the MPS is 0.1
A) Applying Keynesian (Demand-side) economics how much must the government change spending to close the gap - Be explicit - Show math work
B) If they chose to use a tax cut, what would they do? How much must the tax revenue change-show work
C) In both A and B, which curve will shift and in what direction?
2) What would supply-side economists recommend to close a gap?-Explain
3) If the aggregate supply curve shifts back, what happens to inflation and what is this type of inflation called.
In: Economics
1. Using the concepts of demand and supply, explain why cannabis prices declined sharply by 70% in Colorado between 2014 and 2018. Use a diagram of the cannabis market to illustrate your point.
2. With the help of a numerical example, explain why California and Maine tax cannabis by weight rather than by price.
3. Using the concept of substitutes and complements, explain with the help of a diagram how legalising cannabis may possibly affect the sales of alcohol and cigarettes. When the State government evaluates the effect of legalising cannabis on tax revenue, should it look only at the sales of cannabis? Or, should it also consider the changes in the sales of alcohol and cigarettes?
In: Operations Management
The following information is available for Chenard Corporation for the year ended December 31, 2017.
Beginning cash balance $35,000
Accounts payable decrease 3,200
Depreciation expense 76,000
Accounts receivable increase 8,200
Inventory increase 13,000
Net income 269,100
Cash received for sale of land at book value 35,000
Sales revenue 747,000
Cash dividends paid 12,000
Income tax payable increase 4,700
Cash used to purchase building 144,000
Cash used to purchase treasury stock 32,000
Cash received from issuing bonds 206,000
Prepare a statement of cash flows using the indirect method.
In: Accounting
Which one of the following bases of income and expense recognition is acceptable for Financial reporting under current GAAP?
A. Cash basis
B. Modified cash basis
C. Accrual basis
D. All of these
Under the cash basis, expenses are recognized when
A. They are paid by the entity
B. The costs expire or as assets are used
C. The revenue are recognized that the expenses helped to produce
D. Cash is received from revenues that the expenses helped to produce
Which of the following transactions will not be recognized in cash basis accounting?
A. Unsold inventory at the end of the period
B. Collection of account sales
C. Payment of utilities
D. Purchase of equity shares in Dogs Corporation
In: Accounting
The company sells an industrial line of products that are all subject to a 3-year warranty. Prior experience has resulted in an average warranty cost of 3% of revenue for its products. The company had an accrued warranty liability of $500,000 at December 2018. During January of 2019, product sales were $6 million, and the actual warranty costs incurred were $145,000.
a. Prepare journal entries to record product sales (assume all credit sales), the warranty accrual, and actual warranty costs incurred in January of 2019.
b. Show a T-account with for the transactions in the Estimated Warranty Liability account for January, with the correct ending balance for this liability.
In: Accounting
| Cost | Retail | |
| Inventory | 247,100 | 390,000 |
| Purchases | 930,823 | 1,484,000 |
| Purchase returns | 59,000 | 78,500 |
| Purchase Discounts | 18,400 | |
| Gross sales revenue | 1,410,500 | |
| Sales returns | 98,700 | |
| Markups | 118,400 | |
| Markup cancellation | 39,600 | |
| Markdowns | 45,300 | |
| Markdown cancellation | 20,000 | |
| Freight in | 42,800 | |
| Employee discount granted | 7,900 | |
| Loss from breakage (normal) | 5,000 |
Assuming that Marin Inc. uses the conventional retail inventory
method, compute the cost of its ending inventory at December 31,
2021. (Round ratios for computational purposes to 0
decimal places, e.g 78% and final answer to 0 decimal places, e.g.
28,987.)
In: Accounting
On January 2, 2019, Royal Class Air Conditioning and Heating sold and installed an HVAC system to Peak Co. for $2,750. The selling price is allocated as follows: (1) 90% for the HVAC unit and (2) 10% for an ongoing 4-year service contract for the HVAC unit.
a. Determine each of the following related to this sale:
1. Identify the contract between the company and the customer.
2. Identify the performance obligations of Royal Class.
3. Determine the transaction price.
4. Allocate the transaction price to the performance obligations.
b. What amount of revenue should Royal Class recognize for the year ended December 31, 2019?
In: Accounting
Example 4:
Suppose that the monopolist faces a demand curve for its widgets as q = 9 - 0.2p. The firm’s marginal revenue and cost functions are: MR(q) = 45 – 10q and MC(q) = 15 + 5q. The firm’s total cost function is C(q) = 2.5q2 + 15q + 3.
In: Economics