Leach Inc. experienced the following events for the first two years of its operations:

Year 1:

Issued $10,000 of common stock for cash.
Provided $78,000 of services on account.
Provided $36,000 of services and received cash.
Collected $69,000 cash from accounts receivable.
Paid $38,000 of salaries expense for the year.
Adjusted the accounting records to reflect uncollectible accounts expense for the year.
Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.
Closed the revenue account. Closed the expense account.

Year 2:
Wrote off an uncollectible account for $650.
Provided $88,000 of services on account.
Provided $32,000 of services and collected cash.
Collected $81,000 cash from accounts receivable.
Paid $65,000 of salaries expense for the year.
Adjusted the accounts to reflect uncollectible accounts expense for the year.
Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.

Required

a. Record the Year 1 and Year 2 events in general journal form and post them to T-accounts.
b. Prepare the income statement, statement of changes in stockholders’ equity, balance sheet, and statement of cash flows for Year 1 and Year 2.
c. What is the net realizable value of the accounts receivable at Year 1 and Year 2?

Answers

Answer 1

Answer:

a.1) year 1

Issued $10,000 of common stock for cash.

Dr cash 10,000

    Cr common stock 10,000

Provided $78,000 of services on account.

Dr accounts receivable 78,000

    Cr service revenue 78,000

Provided $36,000 of services and received cash.

Dr cash 36,000

    Cr service revenue 36,000

Collected $69,000 cash from accounts receivable.

Dr cash 69,000

    Cr accounts receivable 69,000

Paid $38,000 of salaries expense for the year.

Dr wages expense 38,000

    Cr cash 38,000

Adjusted the accounting records to reflect uncollectible accounts expense for the year.  Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.

Dr bad debt expense 450

    Cr accounts receivable 450

Closed the revenue account. Closed the expense account.

Dr service revenue 114,000

    Cr income summary 114,000

Dr income summary 38,450

    Cr wages expense 38,000

    Cr bad debt expense 450

Dr income summary 75,550

    Cr retained earnings 75,550

b.1) income statement year 1

Service revenue           $114,000

Expenses:

Wages $38,000Bad debt $450    ($38,450)

Net income                   $75,550

balance sheet year 1

Assets:

Cash $77,000

Accounts receivable $8,550

total assets                                           $85,550

Equity:

Common stock $10,000

Retained earnings $75,550

total equity                                            $85,550

statement of cash flows year 1

Cash flows form operating activities:

Net income                                      $75,550

adjustments:

Increase in accounts receivable     ($8,550)

net cash from operating activities  $67,000

Cash flow from financing activities:

Common stocks issued                   $10,000

Net cash increase                           $77,000

beginning cash balance                          $0

Ending cash balance                      $87,000

a.2) Year 2:

Wrote off an uncollectible account for $650.

Dr bad debt expense 650

    Cr accounts receivable 650

Provided $88,000 of services on account.

Dr accounts receivable 88,000

    Cr service revenue 88,000

Provided $32,000 of services and collected cash.

Dr cash 32,000

    Cr service revenue 32,000

Collected $81,000 cash from accounts receivable.

Dr cash 81,000

    Cr accounts receivable 81,000

Paid $65,000 of salaries expense for the year.

Dr wages expense 65,000

    Cr cash 65,000

Adjusted the accounts to reflect uncollectible accounts expense for the year.  Leach estimates that 5 percent of the ending accounts receivable balance will be uncollectible.

Dr bad debt expense 745

    Cr accounts receivable 745

b.2) income statement year 2

Service revenue             $120,000

Expenses:

Wages $65,000Bad debt $1,395    ($38,450)

Net income                      $53,605

balance sheet year 2

Assets:

Cash $125,000

Accounts receivable $14,155

total assets                                           $139,155

Equity:

Common stock $10,000

Retained earnings $129,155

total equity                                            $139,155

statement of cash flows year 2

Cash flows form operating activities:

Net income                                      $53,605

adjustments:

Increase in accounts receivable     ($5,605)

net cash from operating activities  $48,000

Net cash increase                           $48,000

beginning cash balance                 $77,000

Ending cash balance                    $125,000

c) net realizable value of accounts receivable at year 1 = $8,550

net realizable value of accounts receivable at year 2 = $14,155

Answer 2

a. Recording the Year 1 and Year events in general journal form and posting to T-accounts for Leach Inc. are as follows:

General Journal

Year 1:

Debit Cash $10,000

Credit Common stock $10,000

Debit Accounts Receivable $78,000

Credit Service Revenue $78,000

Debit Cash $36,000

Credit Service Revenue $36,000

Debit Cash $69,000

Credit Accounts Receivable $69,000

Debit Salaries Expense $38,000

Credit Cash $38,000

Adjustment:

Debit Bad Debts Expense $450

Credit Uncollectible Allowance $450

Year 2:

Debit Accounts Receivable $650

Credit Uncollectible Allowance $650

Debit Accounts Receivable $88,000

Credit Service Revenue $88,000

Debit Cash $32,000

Credit Service Revenue $32,000

Debit Cash $81,000

Credit Accounts Receivable $81,000

Debit Salaries Expense $65,000

Credit Cash $65,000

Adjustment:

Debit Bad Debts Expense $968

Credit Uncollectible Allowance $968

T-accounts:

Year 1:

Cash Account

Common stock             $10,000

Service Revenue         $36,000

Accounts Receivable  $69,000

Salaries Expense                            $38,000

Balance                                           $77,000

Uncollectible Allowance

Bad debts Expense                           $450

Common Stock

Cash account                                 $10,000

Accounts Receivable

Service Revenue       $78,000

Cash                                            $69,000

Balance                                         $9,000

Service Revenue

Accounts Receivable                $78,000

Cash                                           $36,000

Income Summary     $114,000

Salaries Expense

Cash                          $38,000

Income Summary                    $38,000

Bad Debts Expense

Uncollectible Allowance $450

Income Summary                    $450

Year 2:

Cash Account

Balance                         $77,000

Service Revenue         $32,000

Accounts Receivable   $81,000

Salaries Expense                           $65,000

Balance                                        $125,000

Uncollectible Allowance

Balance                                             $450

Accounts Receivable      $650

Bad debts expense                           $968

Balance                           $768

Common Stock

Balance                                         $10,000

Accounts Receivable

Balance                         $9,000

Service Revenue       $88,000

Uncollectible allowance                   $650

Cash                                             $81,000

Balance                                        $15,350

Service Revenue

Accounts Receivable                $88,000

Cash                                           $32,000

Income Summary     $120,000

Salaries Expense

Cash                          $65,000

Income Summary                    $65,000

Bad Debts Expense

Uncollectible Allowance $968

Income Summary                    $968

b. The preparation of the income statement, statement of changes in stockholders' equity, balance sheet, and statement of cash flows for Year 1 and Year 2 are as follows:

Leach Inc.

Income Statements for Year 1 and Year 2:

                                            Year 1                      Year 2

Service Revenue             $114,000                  $120,000

Salaries Expense 38,000                 $65,000

Bad Debts Expense  450  38,450           968    65,968

Net income                     $75,550                   $54,032

Leach Inc.

Statements of Changes in Stockholders' Equity for Year 1 and  Year 2:

                                            Year 1                      Year 2

Beginning balance            $10,000                  $85,550

Net income                          75,550                    54,032

Ending balance                $85,550                 $139,582

Leach Inc.

Balance Sheets at Year 1 and Year 2:

                                            Year 1                      Year 2

Assets:

Cash                                 $77,000                  $125,000

Accounts Receivable          9,000                       15,350

Uncollectible Allowance       (450)                         (768)

Total assets                     $85,550                 $139,582

Equity:

Ending balance              $85,550                 $139,582

Leach Inc.

Statements of Cash Flows for Year 1 and 2:

Operating Activities:                 Year 1        Year 2

Net income                              $75,550    $54,032

Changes in working capital:

Accounts receivable               (8,550)        (6,032)

Operating cash flows          $67,000     $48,000

Financing Activities:

Common Stock                   $10,000        $0

Increase in cash flows       $77,000      $48,000

c. The net realizable value of the accounts receivable at Year 1 is $8,550 ($9,000 - $450) and Year 2 is $14,582 ($15,350 - $768).

Data Analysis:

Year 1:

Cash $10,000 Common stock $10,000

Accounts Receivable $78,000 Service Revenue $78,000

Cash $36,000 Service Revenue $36,000

Cash $69,000 Accounts Receivable $69,000

Salaries Expense $38,000 Cash $38,000

Adjustment:

Bad Debts Expense $450 Uncollectible Allowance $450

Year 2:

Uncollectible Allowance $650 Accounts Receivable $650

Accounts Receivable $88,000 Service Revenue $88,000

Cash $32,000 Service Revenue $32,000

Cash $81,000 Accounts Receivable $81,000

Salaries Expense $65,000 Cash $65,000

Adjustment:

Bad Debts Expense $968 Uncollectible Allowance $968

= $968 ($650 + $768 - $450)

$768 ($15,350 x 5%)

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Related Questions

financial statement information and additional data for Stanislaus Co. is presented below. Prepare a statement of cash flows for the year ending December 31, 2014December 31 2013 2014Cash $42,000 $75,000Accounts receivable (net) 84,000 144,200Inventory 168,000 206,600Land 58,800 21,000Equipment 504,000 789,600TOTAL $856,800 $1,236,400Accumulated depreciation $84,000 $115,600Accounts payable 50,400 86,000Notes payable - short-term 67,200 29,400Notes payable - long-term 168,000 302,400Common stock 420,000 487,200Retained earnings 67,200 215,800TOTAL $856,800 $1,236,400Additional data for 2014:1. Net income was $240,000, see income statement below.2. Depreciation was $31,600.3. Land was sold at its original cost.4. Dividends were paid.5. Equipment was purchased for $184,000 cash.6. A long-term note for $101,000 was used to pay for an equipment purchase.7. Common stock was issued8. Company issued $33,400 long-term note payable. Income Statement For the year ended December 31, 2014Sales revenue…………….. $1,200,000Cost of goods sold……… .......480,000Gross profit .............................720,000Selling and administrative expenses….. 360,000Pre-tax operating income .......................340,000Income taxes ..........................................120,000Net income……………………………… $240,0001. Prepare the statement of cash flow using the indirect method2. Prepare the statement of cash flow using the direct method

Answers

Answer:

Statement of cash flow for the year ended December 31, 2014

Cash flow from Operating Activities

Cash Receipts from Customers                       $1,139,800

Cash Paid to Suppliers and Employees           ($811,600)

Cash Generated from operations                     $328,200

Income tax paid                                                 ($120,000)

Net Cash from Operating Activities                 $208,200

Cash flow from Investing Activities

Purchase of Equipment                                     ($101,000)

Proceeds from Sale of Land                               $37,800

Net Cash from Investing Activities                      $63,200

Cash flow from Financing Activities

Issue of Note Payables                                      $33,400

Repayment of Note Payables                           ($37,800)

Issue of Common Stock                                     $67,200

Dividends Paid                                                   ($91,400)

Net Cash from Financing Activities                  ($28,600)

Movement during the year                                $33,000

Beginning Cash and Cash Equivalents             $42,000

Ending Cash and Cash Equivalents                   $75,000

Explanation:

The Direct Method has been used to to prepare Cash flow Statement. See also calculation of the respective line items done below.

Cash Receipts from Customers calculation :

Total Trade Receivables T - Account

Debit :

Beginning Balance                              $84,000

Sales Revenue                                $1,200,000

Totals                                               $1,284,000

Credit :

Cash Receipts from Customers      $1,139,800

Ending Balance                                  $144,200

Totals                                               $1,284,000

Cash Paid to Suppliers and Employees calculation :

Cost of goods sold                                          $480,000

Add Selling and administrative expenses     $360,000

Adjustment for Non -Cash Items :

Depreciation                                                      ($31,600)

Adjustment for Working Capital Items :

Increase in Inventory                                         $38,800

Increase in Accounts Payables                        ($35,600)

Cash Paid to Suppliers and Employees           $811,600

Note payable T - Account

Debit :

Ending (29,400 + 302,400)                             $331,800

Cash (Balancing figure)                                     $37,800

Totals                                                               $369,600

Credit :

Beginning (67,200 + 168,000)                       $235,200

Equipment                                                        $101,000

Cash                                                                   $33,400

Totals                                                               $369,600

Equipment T - Account

Debit :

Beginning Balance                                        $504,000

Note Payable                                                   $101,000

Cash                                                                 $184,000

Totals                                                              $789,000

Credit :

Ending Balance                                              $789,600

Disposal                                                                      $0

Totals                                                              $789,000

Calculation of Dividends

Beginning Retained Earnings Balance          $67,200

Add Income for the year                              $240,000

Less Ending Retained Earnings Balance     $215,800

Dividends Paid                                                 $91,400

Nutritional Foods reports merchandise inventory at the​ lower-of-cost-or-market. Prior to releasing its financial statements for the year ended August ​31, 2019​, Nutritional's preliminary income​ statement, before the​ year-end adjustments, appears as​ follows:

NUTRITIONAL FOODS
Income Statement (Partial)
Year Ended March 31, 2017
Sales Revenue ........ $117,000
Cost of Goods Sold ..... 45,000
Gross Profit ........ $72,000

Nutritional has determined that the current replacement cost of ending merchandise inventory is $17,000. Cost is $19,000.

Required:
a. Journalize the adjusting entry for merchandise​ inventory, if any is required.
b. Prepare a revised partial income statement to show how Nutritional Foods should report sales, cost of goods sold, and gross profit.

Answers

Answer:

a) since the cost of ending inventory is higher than the replacement value, then ending inventory must decrease, which will result in higher COGS. The adjusting journal entry is:

March 31, 2017, inventory adjustment

Dr Cost of goods sold 2,000

    Cr Merchandise inventory 2,000

b) revised income statement

NUTRITIONAL FOODS

Income Statement (Partial)

Year Ended March 31, 2017

Sales Revenue ........ $117,000

Cost of Goods Sold ..... $47,000

Gross Profit ........ $70,000

Because there isn't one single measure of inflation, the government and researchers use a variety of methods to get the most balanced picture of how prices fluctuate in the economy. Two of the most commonly used price indexes are the consumer price index (CPI) and the GDP deflator.

The GDP deflator for this year is calculated by dividing the____________________ using by_____________________________ the using___________ and multiplying by 100. However, the CPI reflects only the prices of all goods and services .

Indicate whether each scenario will affect the GDP deflator or the CPI for the United States.

a. A decrease in the price of a Chinese-made car that is popular among U.S. consumers.
b. An increase in the price of a Waterman Industries deep-water reel, which is a commercial fishing product used for deep-sea fishing, made in the U.S., but not bought by U.S. consumers.

Answers

Answer:

1. The GDP deflator for this year is calculated by dividing the Value of all goods and services produced in the economy this year using  this year's prices by the Value of all goods and services produced in the economy in the base year using the base year's prices and multiplying by 100.

However, the CPI reflects only the prices of all goods and services bought by consumers.

2. a. A decrease in the price of a Chinese-made car that is popular among U.S. consumers. Affects CPI.

This affects CPI because the CPI reflects only the prices of goods and services purchased by customers.

b. An increase in the price of a Waterman Industries deep-water reel, which is a commercial fishing product used for deep-sea fishing, made in the U.S., but not bought by U.S. consumers. Affects GDP Deflator.

This is a good produced in the United States so it will affect the GDP Deflator as that deals with GDP.

With respect to dividends and priority in liquidation, what has priority over common stock? Group of answer choices Treasury Stock Debt Capital Preferred Stock nonconvertible common equity

Answers

Answer:

Preferred stock

Explanation:

Preferred stock is a stock that has properties of both stocks and bonds. this is why they are referred to as an hybrid instrument.  Preferred stock holders have priority over common shareholders with respect to dividends and liquidation,

It is important that marketers be able to identify which strategy a competitor is using so that they better understand how to position their own products and services. You will see a list of recent or potential strategic decisions made by large firms, and your job is to identify which type of strategy was used in each example.

While there are a variety of strategies across industries, most fall under four basic categories.

1. Market penetration strategies emphasize selling more existing products and services to existing customers.
2. Product development strategies involve creating new goods or services for existing markets.
3. Market development strategies focus on selling existing products or services to new customers. The targeted new customers could be a different gender, age group, or international market.
4. Finally, diversification strategies involve offering new products that are unrelated to the existing products produced by the organization.


Select the most appropriate category of emotional intelligence for below mention behaviors.

i. Arm and Hammer selling baking soda for new purposes.

a. Market penetration
b. Product development
c. Market development
d. Diversification

ii. Apple opening mini-stores within Target

a. Market penetration
b. Product development
c. Market development
d. Diversification

iii. Disney purchasing ESPN

a. Market penetration
b. Product development
c. Market development
d. Diversification

Answers

Answer:

1. Market development

2. Market penetration

3. Diversification

Explanation:

we have already been given a definition of these concepts from question

1.

for Ann and hammer: it is market development because they are trying to create a product for new purposes

2.

for apple: since they are opening mini stores within target they are trying to have an expansion approach where more products and services would be sold to their customers.

3.

for disney: they are diversifying into a new product entirely. ESPN is a well known channel for sporting related activities.

A company has total equity of $2,160, net working capital of $240, long-term debt of $1,070, and current liabilities of $4,500. What is the company's net fixed assets?

Answers

Answer:

$2,990

Explanation:

A company's fixed asset consist of its plants and machineries, motor vehicles , buildings etc.

To get the company's net fixed asset, we would subtract the networking capital from total equity and add up long term debt.

Therefore,

Net fixed asset = $2,160 total equity - $240 working capital + $1,070 long term debt

= $2,990

Hence net fixed asset is $2,990

Please discuss the following two scenarios: Both scenarios consist of a loan of $1000 on Jan.1 - to be paid back on Dec. 31. A is the lender and B is the debtor.

Scenario 1: On Nov. 7th, A calls B to see how he is doing. B says he is not doing well. A asks if B will be able to pay the $1000 on Dec. 31. B says probably not. A asks how much B will have and B says about $700. A tells B to pay him $700 on Dec. 31 and that he will not owe him the additional $300. A puts it in writing. On Dec. 31, B pays the agreed upon $700. Then on January 15th, A calls B and tells him that he wants the additional $300.

Scenario 2: Same situation, but on the Nov. 7th phone call, A tells B to pay him the $700 now and then he will not owe him the additional $300. It is put in writing. B pays $700 on Nov. 7th. Then on January 15th, A calls B and tells him that he wants to additional $300. In which scenario can A get the additional $300.

In which scenario can A get the additional $300? It could be in both scenarios, neither or one of them. What do you think?

Answers

Answer:

Neither

Explanation:

When A creates a deal of B paying only $700 now or on 31st December with a written commitment that he will not owe $300, it means A has decided to write off the $300. Had A not created any written document and just asked B to pay $700 now and then later on reminded and demanded $300 it would have been fine. A would still be legally right in maintaining that B still owes the balance $300.  

However, giving a written commitment of waving off the $300 on payment of $700 now or by 31st Dec which B accepts and also adheres to by paying means that B has fulfilled the new agreement. As A has only floated the new agreement, he cannot go back from his own statements.

The revenues budget identifies: a. expected cash flows for each product b. actual sales from last year for each product c. the expected level of sales for the company d. the variance of sales from actual for each product

Answers

Answer:

c. the expected level of sales for the company

Explanation:

Revenue/Sales Budget is the first budget to be prepared by most companies because most businesses are sales led.

This Budget shows, the expected level of sales for the company.

What was the non-live show revenue (merchandising + record sales + etc) for the Amzai Brothers during September-December 2019?

Answers

Full question attached

Answer and Explanation:

Answer and explanation attached

Firms may not include all income taxes for a period on the line for income tax expense in the income statement. Other places that income tax expenses may occur include all of the following except: Select one: a. Extraordinary Items b. Other Comprehensive Income c. Common Stock d. Discontinued Operations

Answers

Answer:

Option C

Explanation:

Firms may not include all income taxes for a period on the line for income tax expense in the income statement. Other places that income tax expenses may occur include all of the following except Common Stock. Common stock is a form of corporate equity ownership, a type of security. Common stock is reported in the stockholder's equity section of a company's balance sheet.

Balance Sheet Data Income Statement Data
Cash $600,000 Accounts payable $720,000 Sales $12,000,000
Accounts receivable 1,200,000 Accruals 240,000 Cost of goods sold 7,200,000
Inventory 1,800,000 Notes payable 960,000 Gross profit 4,800,000
Current assets 3,600,000 Current liabilities 1,920,000 Operating expenses 3,000,000
Long-term debt 2,400,000 EBIT 1,800,000
Total liabilities 4,320,000 Interest expense 403,200
Common stock 720,000 EBT 1,396,800
Net fixed assets 3,600,000 Retained earnings 2,160,000 Taxes 488,880
Total equity 2,880,000 Net income $907,920
Total assets $7,200,000 Total debt and equity $7,200,000
If I remember correctly, the DuPont equation breaks down our ROE into three component ratios: the turnover ratio, and the the total asset And, according to my understanding of the DuPont equation and its calculation of ROE, the three ratios provide insights into the company's effectiveness in using the company's assets, and Hydra Cosmetics Inc. DuPont Analysis Ratios Value Correct/Incorrect Value Correct/Incorrect Ratios Asset management ratio Total assets turnover 1.67 Profitability ratios Gross profit margin (%) Operating profit margin (%) Net profit margin (%) Return on equity (%) 40.00 11.64 14.55 40.58 Financial ratios Equity multiplier 1.67 Do not round intermediate calculations and round your final answers up to two decimals. Hydra Cosmetics Inc. DuPont Analysis Calculation Value Numerator Denominator Ratios Profitability ratios Gross profit margin (%) Operating profit margin (%) Net profit margin (%) Return on equity (%) Asset management ratio Total assets turnover Financial ratios Equity multiplier Check all that apply. Reduce the company's operating expenses, its cost of goods sold, and/or the interest rate on its borrowed funds because this will increase the company's net profit margin. Increase the cost and amount of assets necessary to generate each dollar of sales because it will increase the company's total assets turnover. Increase the efficiency of its assets so that it generates more sales with each dollar of asset investment and increases the company's total assets turnover. Increase the interest rate on its notes payable or long-term debt obligations because it will reduce the company's net profit margin.

Answers

Question attached

Answer and Explanation:

Find answer and explanation attached

Consider a second-price, sealed-bid auction with a seller who has one unit of the object which he values at s and two buyers 1, 2 who have values of v1 and v2 for the object. The values s, v1, v2 are all independent, private values. Suppose that both buyers know that the seller will submit his own sealed bid of s (and will keep the item if bid s wins), but they do not know the value of s. The buyers know that the seller must submit his bid before seeing the buyer’s bids and they know that the seller will actually run a second price auction with the three bids he has: his own bid and the two buyer’s bids. Each buyer knows his own value but not the other buyer’s value.

Now suppose that the seller opens the bids from the buyers and then submits his own bid after seeing the bids from the two buyers. The seller runs a second price auction with these bids in the sense that the object is awarded to the highests bidder (one of the two buyers or the seller) and that bidder pays the second highest bid. Now is it optimal for the buyers to bid truthfully; that is, should they each bid their true value? Give a brief explanation for your answer.

Answers

Answer and Explanation:

Given that this is a second price bid auction whereby the second highest bid is the price that the highest bidder pays for the item up for auction sale, so that b1>b2 then b1 gets item for the price of b2.

Truthfulness of true value is the dominant strategy here which means each player should aim to be truthful with their bid regarding their true value regardless of what other bidders are bidding. Therefore truthfulness of value is the optimal strategy with the best payoff for bidders

What will be the nominal rate of return on a perpetual preferred stock with a $100 par value, a stated dividend of 8% of par, and a current market price of (a) $62, (b) $81, (c) $97, and (d) $136

Answers

Answer and Explanation:

The computation of the risk premium is shown below:-

Rate of return = Dividend ÷ Current market price of preferred stock

The dividend should be

= $100 × 8%

= $8

a Rate of return = $8 ÷ $62

= 12.90%

b. Rate of return = $8 ÷ $81

= 9.88%

c. Rate of return = $8 ÷ $97

= 8.25%

d. Rate of return = $8 ÷ $136

= 5.88%

The following information is available for Mergenthaler Corporation for the year ended December 31, 2022:

Collection of principal on long-term loan to a supplier $16,000
Acquisition of equipment for cash 10,000
Proceeds from the sale of long-term investment at book value 22,000
Issuance of common stock for cash 20,000
Depreciation expense 25,000
Redemption of bonds payable at carrying (book) value 34,000
Payment of cash dividends 6,000
Net income 30,000
Purchase of land by issuing bonds payable 40,000

In addition, the following information is available from the comparative balance sheet for Mergenthaler at the end of 2022 and 2021:

2021 2022
Cash $148,000 $91,000
Accounts receivable (net) 25,000 15,000
Prepaid insurance 19,000 13,000
Total current assets $192,000 $119,000
Accounts payable $30,000 $19,000
Salaries and wages payable 6,000 7,000
Total current liabilities $36,000 $26,000

Required:
Prepare Mergenthaler's statement of cash flows for the year ended December 31, 2014, using the indirect method.

Answers

Answer:

Cash Flow from Operating Activities          Amount$

Net Income                                                        30000

Add Depreciation Expense                              25000

Increase in Accounts Payable                          11000

Increase in Accounts Receivables                  -10000

Increase in Prepaid Insurance                         -6000

Decrease in Salaries and Wages Payable       -1000

Net Cash Flow from Operating Activities A  49000

Cash Flow from Investing Activities

Acquisition of Equipment for Cash                      -10000

Proceeds from Sale of Long-Term Investment    22000

Net Cash Flow from Investing Activities B         12000

Cash Flow from Financing Activities

Redemption of Bonds Payable                            -34000

Proceeds from Issuance of Common Stock        20000

Payment of Cash Dividends                                 -6000

Collection of Principal on Long-Term Loan         16000

Net Cash Used in Financing Activities C           -4000

Opening Cash Balance                                        91000

Add Increase in Cash (A+B+C)                             57000

Closing Cash Balance                                          148000

When all of a firm's inputs are doubled, input prices do not change, and this results in the firm's level of production more than doubling, a firm is operating:

Answers

Answer: (B) on the downward-sloping portion of its long-run average total cost curve.

Explanation:

The downward-sloping portion of a company's Long Run Average Total Cost(LRATC) curve is the part where increasing returns to scale is witnessed.

This is because the costs that are incurred by the company leads to higher proportional output thereby reducing the average cost and pulling the LRATC down.

In this scenario, the inputs doubled and the firm's level of production more than doubled which means that with outputs increasing more than costs, the Average cost is reducing and the slope is downward sloping.

Thirteen students entered the business program at Sante Fe College 2 years ago. The following table indicates what each student scored on the high school SAT math exam and their​ grade-point averages​ (GPAs) after students were in the Sante Fe program for 2 years.
Student A B C D E F G
SAT Score 421 375 585 693 608 392 418
GPA 2.93 2.87 3.03 3.42 3.66 2.91 2.12
Student H I J K L M
SAT Score 484 725 506 613 706 366
GPA 2.50 3.24 1.97 2.73 3.88 1.58 ​
The​ least-squares regression equation that shows the best relationship between GPA and the SAT score is:________ ​(round your responses to four decimal ​places)​

Answers

Answer:

ŷ = 0.0035X + 1.0030

Explanation:

Given the data :

Student A B C D E F G H I J K L M

SAT Score: 421 375 585 693 608 392 418 484 725 506 613 706 366

GPA: 2.93 2.87 3.03 3.42 3.66 2.91 2.12 2.50 3.24 1.97 2.73 3.88 1.58 ​

We can obtain the Least square regression calculator, we can obtain the least square regression equation in the Format :

y = mx + c

Where ; m = gradient / slope

x = predictor variable ; c = intercept

y = Independent variable.

The model equation produced by the calculator is :

ŷ = 0.0035X + 1.0030

y predicted variable ; x = explanatory variable

0.0035 = slope or gradient ; 1.0030 = intercept

The Correct Answer is: ŷ = 0.0035X + 1.0030Given the data that is:Then Student is A B C D E F G H I J K L M sat score is421 375 585 693 608 392 418 484 725 506 613 706 366GPA :That is 2.93 2.87 3.03 3.42 3.66 2.91 2.12 2.50 3.24 1.97 2.73 3.88 1.58 ​Then We can obtain the Least square regression calculator, we can obtain the least square regression equation in the Format is :Then y = mx + cWhere; m = gradient / slopeThen x is = predictor variable ; c = intercepty is = Independent variable.After that The model equation produced by the calculator is :Then ŷ is = 0.0035X + 1.0030Now y predicted variable; x is = explanatory variableThus, 0.0035 = slope or gradient ; 1.0030 = intercept

Find out more information about sat score here:

https://brainly.com/question/2264831

Who was the first missionary to arrive in Africa?​

Answers

the london missionary sent david livingstone to south africa in 1840.

Answer:

David Livingstone in 1840.

Hope this helps ; )   Enjoy your day!

At January 1, 2021, Cafe Med leased restaurant equipment from Crescent Corporation under a nine-year lease agreement. The lease agreement specifies annual payments of $29,000 beginning January 1, 2021, the beginning of the lease, and at each December 31 thereafter through 2028. The equipment was acquired recently by Crescent at a cost of $207,000 (its fair value) and was expected to have a useful life of 13 years with no salvage value at the end of its life. (Because the lease term is only 9 years, the asset does have an expected residual value at the end of the lease term of $94,113.) Crescent seeks a 12% return on its lease investments. By this arrangement, the lease is deemed to be an operating lease.

Required:
a. What will be the effect of the lease on Cafe Med's earnings for the first year (ignore taxes)?
b. What will be the balances in the balance sheet accounts related to the lease at the end of the first year for Café Med (ignore taxes)?

Answers

Answer:

Café Med

a. Café Med's earnings for the first year will be reduced by $58,000 (Operating lease expense for January 1 and December 31, 2021).

b. In Café Med's Balance Sheet, at the end of the first year, there will be a liability balance or Lease Expense Payable of $29,000 for the balance due to be paid on December 31, 2021.

Explanation:

Lease annual payments = $29,000

First payment date = January 1, 2021

Subsequent payment dates = December 31, 2021 to 2028.

Period of lease agreement = 9 years < 75% (9/13)

Cost of equipment to Crescent = $207,000

Lifespan of equipment = 13 years

Residual value at end of the lease term = $94,113

b) Café Med will recognize this lease arrangement as an operating lease.  This is based on periodic rental payment on a straight-line basis, which is recorded as an operating lease expense.  The liability arising will be for unpaid rentals at the end of the accounting period.

A Corporation has two divisions: the South Division and the West Division. The corporation's net operating income is $26,900. The South Division's divisional segment margin is $42,800 and the West Division's divisional segment margin is $29,900. What is the amount of the common fixed expense not traceable to the individual divisions

Answers

Answer:

$45,800

Explanation:

Common fixed expense not traceable to the individual divisions = South division's divisional segment margin + west division's divisional segment - corporation's net operating income

Common fixed expense not traceable to the individual divisions = $42,800 + $29,900 - $26,900

Common fixed expense not traceable to the individual divisions = $45,800

Assessment
A customer hands you $3,850 in cash and would like to purchase 14 prepaid cards of
$275 each. The customer hands you the cash with an expired ID, and is expecting you to
process the transaction.
You must decline the transaction for the following reasons: (Select all that apply)
A customer may not purchase more than $2,000 in prepaid cards within a 24-hour period.
We do not sell prepaid cards.
The POS will prompt for customer ID for all prepaid card purchases.
Customer ID must be a valid (not expired) government issued photo ID (US or Canadian
issued driver's license, state ID, passport; US military ID, US Territory ID)
The customer appears to be purchasing prepaid cards just below the threshold where an ID
would be needed.
The customer is attempting to purchase more than the allowable number of gift cards in a
single transaction.

Answers

Answer:

You must decline the transaction for the following reasons:

A customer may not purchase more than $2,000 in prepaid cards within a 24-hour period.

Customer ID must be a valid (not expired) government issued photo ID (US or Canadian  issued driver's license, state ID, passport; US military ID, US Territory ID)

Customers may not purchase more than $250 at the assisted check out (ACO).

Explanation:  

A customer may not purchase more than $2,000 worth of prepaid products in one business day.

POS will prompt cashiers for an ID at $300:

POS will prompt cashiers to scan or manually enter a valid ID for purchases  at   $300.

Customers may not purchase more than 10 prepaid cards in one day.

Customers may not purchase more than $250 at the assisted check out (ACO).

Managing our prepaid card limits on a daily basis is run, similar to our money order process. The 2,000 daily limits for prepaid/gift cards is accomplished through a partnership with  APPRISS.

 Note :

The POS Register does not allow a single transaction over $2,000 to ensure CVS/pharmacy is in compliance with federal regulations.

Breaking up transactions to allow the purchase of more than $2,000

in prepaid products to one customer, couple or group is strictly against CVS/pharmacy policy and may result in disciplinary action up to, and including, termination of employment.

On January 1, 2021, Marigold Corp. had 461,000 shares of common stock outstanding. During 2021, it had the following transactions that affected the Common Stock account.

February 1 Issued 124,000 shares
March 1 Issued a 10% stock dividend
May 1 Acquired 104,000 shares of treasury stock
June 1 Issued a 3-for-1 stock split
October 1 Reissued 61,000 shares of treasury stock

Required:
Determine the weighted-average number of shares outstanding as of December 31, 2021.

Answers

Answer:

Marigold Corp.

Weighted-average number of shares outstanding as of December 31, 2021:

Date           Outstanding Shares             Number   Weight     Weighted

January 1,   Beginning                             461,000    12/12         461,000

February 1  Issue of new                        124,000     11/12          113,667    

March 1      Stock dividend                      58,500     10/12          48,750

May 1         Treasury stock                    -104,000      8/12         -69,333

June 1        Issue 3-for-1 split               1,618,500      7/12         944,125

October 1  Reissue of Treasury Stock    61,000      3/12          15,250

Dec. 31     Total Outstanding shares 2,219,000         12      1,513,459

Explanation:

a) Data and Calculations:

Date           Outstanding Shares            Number

January 1,  Beginning                              461,000

February 1 Issue of new                         124,000

March 1     Stock dividend                       58,500 (10% of 461,000 + 124,000)

May 1        Treasury stock                     -104,000

June 1       Issue 3-for-1 split                1,618,500 (539,500 x 3)

October 1 Reissue of Treasury Stock     61,000

Dec. 31     Total Outstanding shares 2,219,000

b) The months remaining to the end of the year are used to assign weights to the shares.

Tom Cruise Lines Inc. issued bonds five years ago at $1,000 per bond. These bonds had a 20-year life when issued and the annual interest payment was then 13 percent. This return was in line with the required returns by bondholders at that point as described below:
Real rate of return 4 %
Inflation premium 5
Risk premium 4
Total return 13 %
Assume that five years later the inflation premium is only 3 percent and is appropriately reflected in the required return (or yield to maturity) of the bonds. The bonds have 15 years remaining until maturity. Use Appendix B and Appendix D.

Answers

Answer:

$1,161.23

since the coupon rate is higher than the market rate, the bonds will be priced at a premium

Explanation:

In order to calculate the current market price of the bonds we can use the yield to maturity formula:

YTM = {coupon + [(face value - market value)/n]} / [(face value + market value)/2]

YTM = 11%n = 15 yearscoupon = $130face value = $1,000

0.11 = {130 + [(1,000 - market value)/15]} / [1,000 + market value)/2]

0.11 x [1,000 + market value)/2] = 130 + [(1,000 - market value)/15]

0.11 x (500 + 0.5M) = 130 + 66.67 - 0.067M

55 + 0.055M = 196.67 - 0.067M

0.122M = 141.67

M = 141.67 / 0.122 = $1,161.23

Hector was prosecuted following police seizure of 80 pounds of drugs from his airplane. The seizure was held to be unlawful, the evidence was sup- pressed, and the suit against Hector was dismissed. He sued the government officials involved in his arrest and prosecution to recover $3,500 in bail bond expenses, $23,000 in attorney's fees, and $2,000 in travel costs. The district court held he could not recover the costs incurred during the criminal prosecution. Hector appealed. Can he recover the costs? (Hector v. Watt, 235 F.3d 154, 3rd Cir. (2000)]

Answers

Answer:

Hector will lose.

Explanation:

If someone suffers an illegal search or seizure, he/she can recover any costs associated with that incident, e.g. property damage, injuries (both physical or to their reputation, lawyers, etc.). But if the illegal search actually results in some criminal evidence being discovered, then you cannot recover any costs.  Anything seized illegally will be dismissed, but the reward is not going to jail even if they committed a crime, they get no money back.

Why only ask for a refund of his lawyer's fees, he should also ask for a refund for the value of the drugs? This lawsuit is absolutely ridiculous.

Adelberg Corporation makes two products: Product A and Product B. Annual production and sales are 1,500 units of Product A and 1,500 units of Product B. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.4 direct labor-hours per unit and Product B requires 0.2 direct labor-hours per unit. The total estimated overhead for next period is $87,630. The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports. The new activity-based costing system would have three overhead activity cost pools--Activity 1, Activity 2, and General Factory--with estimated overhead costs and expected activity as follows:
Expected Activity
Activity Cost Pool Estimated Overhead Costs Product A Product B Total
Activity 1 $ 41,400 1,000 500 1,500
Activity 2 15,720 800 400 1,200
General Factory 30,510 600 300 900
Total $ 87,630
(Note: The General Factory activity cost pool's costs are allocated on the basis of direct labor-hours.)
The overhead cost per unit of Product B under the activity-based costing system is closest to:_________
a. $42.90
b. $9.10
c. $21.30
d. $63.92

Answers

Answer:

Results are below.

Explanation:

First, we need to calculate the predetermined overhead rate for each activity:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Activity 1= 41,400/1,500= $27.6 per unit of activity

Activity 2= 15,720/1,200= $13.1 per unit of activity

General Factory= 30,510/900= $33.9 per direct labor hour

Now, we can allocate overhead to product B:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Activity 1= 27.6*500= $13,800

Activity 2= 13.1*400= $5,240

General Factory= 33.9*300= $10,170

Total allocated overhead= $29,210

Unitary allocated overhead= 29,210/1,500= $19.47

The given statements pertain to aggregate supply and aggregate demand. Label each statement as being either true or false.
Statement 1: An increase in the cost of energy affects both aggregate supply and aggregate demand.
A. True
B. False
Statement 2: One of the factors that increase aggregate demand is the consumption of more imports.
A. True
B. False
Statement 3: If the value of people's stock portfolios increases or if peoples houses appreciate in value, then this very easily could lead to an increase in aggregated demand.
A. True
B. False

Answers

Answer:

Statement 1: An increase in the cost of energy affects both aggregate supply and aggregate demand.

A. True

An increase in energy costs reduces both aggregate supply and demand.

Statement 2: One of the factors that increase aggregate demand is the consumption of more imports.

B. False

If net exports decrease (exports - imports), then the aggregate demand curve will shift to the left, which means it will decrease.

Statement 3: If the value of people's stock portfolios increases or if peoples houses appreciate in value, then this very easily could lead to an increase in aggregated demand.

A. True

This would lead to an increase in the net worth of households, which generally leads to higher spending.

Presented below are condensed financial statements adapted from those of two actual companies competing as the primary players in a specialty area of the food manufacturing and distribution industry. ($ in millions, except per share amounts.)
Balance Sheets
Metropolitan Republic
Assets $ 179.3 $ 37.1
Cash
Accounts receivable (net) 422.7 325.0
Short-term investments — 4.7
Inventories 466.4 635.2
Prepaid expenses and other current assets134.6 476.7
Current assets $ 1,203.0 1,478.7
Property, plant, and equipment (net) 2,608.2 2,064.6
Intangibles and other assets 210.3 464.7
Total assets $ 4,021.5 $4,008.0
Liabilities and Shareholders’ Equity
Accounts payable $ 467.9 691.2
Short-term notes 227.1 557.4
Accruals and other current liabilities 585.2 538.5
Current liabilities $ 1,280.2 1,787.1
Long-term debt 535.6 542.3
Deferred tax liability 384.6 610.7
Other long-term liabilities 104.0 95.1
Total liabilities $ 2,304.4 3,035.2
Common stock (par and additional paid-in capital)
144.9 335.0
Retained earnings 2,476.9 1,601.9
Less: treasury stock (904.7) (964.1)
Total liabilities and shareholders’ equity $
4,021.5 4,008.0
Income Statements
Net sales 5,698.0 7,768.2
Cost of goods sold (2,909.0) (4,481.7)
Gross profit $ 2,789.0 3,286.5
Operating expenses (1,743.7 ) (2,539.2)
Interest expense (56.8) (46.6)
Income before taxes $ 988.5 700.7
Tax expense (394.7) (276.1)
Net income 593.8 424.6
Net income per share $ 2.40 6.50
Note: Because comparative statements are not provided you should use year-end balances in place of average balances as appropriate.
Required:
Calculate the rate of return on assets for the following companies
Calculate the return on assets for both companies.
Calculate the Rate of return on shareholders’ equity for the following companies
Calculate the equity multiplier for the following companies.
Calculate the acid-test ratio and current ratio for the following companies.
Calculate the receivables and inventory turnover ratios the following companies.
Calculate the times interest earned ratio for the following companies.

Answers

Answer and Explanation:

We refer to balance sheet figures for each company stated above to retrieve figures for our calculations and use the following formulas for calculations:

For return on assets= net imcome/total assets

For rate of return on shareholders equity =net income/equity

For equity multiplier= total assets/ total equity

For acid-test ratio=liquid assets/current liabilities

For current ratio =current assets/current liabilities

For receivables = credit sales /acct receivables and inventory turnover ratios=cost of goods/inventory

For times interest earned ratio=ebit/interest expenses

If a Treasury note has a bid price of $975, the quoted bid price in the Wall Street Journal would be

Answers

Answer:

the quoted bid price would be 97:16

Explanation:

the quoted ask price will be 97:50

The quoted bid price is the price at which buyers are willing to purchase a security, while the quoted ask is the price at which sellers are willing to sell their securities. There is always a difference between both of them, and it is called the spread.

On September 1, 2019, Fast Track, Inc., was started with $25,000 invested by the owners as contributed capital. On September 30, 2019, the accounting records contained the following amounts:
Unearned revenue $ 500
Accounts payable 2,200
Prepaid expenses $ 1,000
Dividends declared 2,300
Accounts receivable 2,200
Office equipment 20,000
Accumulated depreciation 500
Office supplies 1,750
Cash 9,500
Office supplies expense 600
Consulting fees revenue 19,200
Rent expense 2,400
Contributed capital 25,000
Salary expense 6,900
Depreciation expense 500
Telephone expense 250
Required:
Prepare a classified income statement, a statement of retained earnings and a classified balance sheet for the first month of Fast Track’s operation.

Answers

Answer:

Fast Track, Inc.

Income Statement

For the year ended December 31, 2019

Revenues:

Consulting fees revenue                              $19,200

Expenses:

Office supplies expense $600 Rent expense $2,400 Salary expense $6,900 Depreciation expense $500 Telephone expense $250                 ($10,650)

Net income                                                    $8,550

Fast Track, Inc.

Statement of Retained Earnings

For the year ended December 31, 2019

Beginning balance September 1, 2019      $0

Net income                                               $8,550

Subtotal                                                    $8,550

Dividends                                                ($2,300)

Ending balance December 31, 2019       $6,250

Fast Track, Inc.

Balance Sheet

For the year ended December 31, 2019

                             ASSETS

Current assets

Cash $9,500

Accounts receivable $2,200

Office supplies $1,750

Prepaid expenses $1,000

Total current assets                            $14,450

Property, plant and equipment

Office equipment $20,000

Accumulated depreciation ($500)

Total P, P & E                                        $19,500

Total assets                                                             $33,950

              LIABILITIES AND EQUITY

Current liabilities

Unearned revenue $500

Accounts payable $2,200

Total liabilities                                         $2,700

Equity

Common stock $25,000

Retained earnings $6,250

Total equity                                            $31,250

Total liabilities + equity                                             $33,950

Robert needs his daily fix of coffee in the mid-afternoon and visits different coffee shops that will give him as much utility as possible, given his $20/month food budget. On Monday, the Blue Coffee Shop was selling espresso shots for $3 each and Robert added 3 shots to his cappuccino. By Friday, the Purple Coffee Shop offered espresso shots for $2 each, while all other prices remained the same, so Robert was bold and added 4 espresso shots to his hot beverage.

Required:
Given this information, plot Robert's demand curve for espresso shots.

Answers

Answer:

I drew Robert's demand curve for espresso shots assuming that it was a linear curve since the information contained in the question is limited to that.  

A demand curve generally is downward sloping, since an increase in price will usually result in a higher quantity demanded (at least for normal goods).  

Alice and Bob entered into a forward contract some time ago. Alice has the long position, while Bob has the short position. The forward contract will mature in three months and has a delivery price of $40. The current forward price for the contract is $42. The three-month risk-free interest rate (with continuous compounding) is 8%. What is the value Bob's position?

Answers

Answer:

$ - 1.96

Explanation:

After three months, Alice (long the contract) can buy the underlying by paying the delivery price of $40 which is $2 less than $42 the long position would have to pay if the contract was entered today.

DATA

Delivery price = $40

The three-month risk-free interest rate (with continuous compounding) =8%.

The current forward price = $42

Solution

So based on the present situation, Alice would be in $2 profit at the end of 3 months and Bob would be in $2 loss

Present value of Bob's loss (with continuous compounding) = 2\times e^{-0.08\times 0.25}

Present value of Bob's loss (with continuous compounding) = $1.96

The value of Bob's position is $ - 1.96

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