Question 3 - Homework 1
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Question 3 - Homework 1 - Connect
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Explanation
Note: Intermediate answers are shown below as rounded, but the full answer was used to
complete the calculation.
The time line is:
0
PV
$
To find the PV of a lump sum, we use:
PV = FV/(1 + r
)
t
PV = $191,000/(1.11)
8
PV = $82,879.96
Calculator Solution:
Enter
8
11%
±$191,000
N
I/Y
PV
PMT
FV
Solve for
$82,879.96
Homework 1
90/100 Total points awarded
Help Exit
Submitted
Suppose you are committed to owning a $191,000 Ferrari. If you believe your mutual
fund can achieve an annual rate of return of 11 percent and you want to buy the car in 8
years (on the day you turn 30), how much must you invest today? (Do not round
intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Investment
$
82,880.32
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On April 1, Jiro Nozomi created a new travel agency, Adventure Travel. The following transactions occurred during the company's first
month.
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April 2 Nozomi invested $36,000 cash and computer equipment worth $35,000 in the company in exchange for its common
stock.
167 Computer Equipment
168 Accumulated Depreciation-Computer Equipment.
209 Salaries Payable
307 Common Stock
318 Retained Earnings
319 Dividends
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April 3 The company rented furnished office space by paying $2,200 cash for the first month's (April) rent.
April 4 The company purchased $1,800 of office supplies for cash.
2
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Your company is considering a new project that will require $2,000,000 of new equipment at the start of the project. The equipment will have a depreciable life of 10 years and
will be depreciated to a book value of $250,000 using straight-line depreciation. The cost of capital is 12 percent, and the firm's tax rate is 21 percent Estimate the present
value of the tax benefits from depreciation.
Multiple Choice
$68,250
$207,646
$175,000
S988.789
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Before considering a net operating loss carryforward of $77 million, Fama Corporation reported $270 million of pretax accounting and
taxable income in the current year. The income tax rate for all previous years was 34%. On January 1 of the current year, a new tax law was
enacted, reducing the rate to 28% effective immediately. Fama's income tax payable for the current year would be:
Note: Round your answer to the nearest whole million.
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$66 million.
$118 million.
$64 million.
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AstroTech Semiconductor incurred the following costs in 2024 related to a new product design:
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2. Research and development expense under IFRS
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Clear Water Company reports the following balance sheet accounts as of December 31.
Buildings
Accounts receivable
Land
Merchandise inventory
Accounts payable
Cash
Notes payable (due in 7 years)
office supplies
Common stock
Retained earnings
Wages payable
Prepare a classified balance sheet.
Current assets
Total current assets
Plant assets
Clear Water Company
Balance Sheet
December 31
Assets
$ 25,000
2,000
11,000
7,000
5,000
8,000
30,000
1,000
10,000
6,000
3,000
$
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Ziehart Pharmaceuticals reported Net Sales of $180,000 and Cost of Goods Sold of $59,000. Candy Electronics Corp. reported Net
Sales of $38,000 and Cost of Goods Sold of $27,800.
1. Calculate the gross profit percentage for both companies. (Round your answers to 1 decimal place.)
Gross Profnt
Ziehart Pharmaceuticals
Candy Electronics Corp.
2. Which company has a greater proportion of its sales available to cover expenses other than cost of goods sold?
O Ziehart Pharmaceuticals
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Supply the missing dollar amounts for each of the following independent cases:
Sales
Revenue
Beginning
Inventory
Cost of Goods
Available for Sale
Cost of
Goods Sold
Cases
Purchases
Cost of
Gross Profit
Ending Inventory
A
S.
1,250
S.
650
1,350
860
1,450
750
1,350
660
IC
650
750
850
950
1,360
1,150
1,200
800
1,550
600
1.450
1,060
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Question 2 - Inventory and Over X
36
56
46
51
189
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Cost
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$5
8
9
10
Total
$ 180
448
a. Calculate the cost of ending inventory using the weighted-average method (ending inventory shows 57 units). (Round the "average
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On January 1, 2018, Maywood Hydraulics leased drilling equipment from Aqua Leasing for a five-year period ending December 31,
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Compute the MIRR statistic for Project X and note whether the firm should accept or reject the project with the cash flows shown as follows if the appropriate cost of
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Time:
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3
4
Cash flow:
-175
75
100
75
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13.89 percent, accept
15.73 percent, accept
13.26 percent, accept
13.26 percent, reject
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The following is the adjusted trial balance of Sierra Company.
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Account Title
Cash
Prepaid insurance
Notes receivable (due in 5 years)
Buildings
Accumulated depreciation-Buildings
Accounts payable
Notes payable (due in 3 years).
Common stock
Retained earnings
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Insurance expense
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Adjusted Trial Balance
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8,798
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(2) Prepare a statement of retained earnings for the year ended December 31. The Retained earnings account balance was $13,500 on
December 31 of the prior year.
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The Pizza Merchandise Company has budgeted $45,000 in sales for the month of December. The company's cost of goods sold is 30% of
sales. If the company has budgeted to purchase $23,000 in merchandise during December, then the budgeted change in inventory levels
over the month of December is:
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$9,500 increase.
$8,500 decrease.
$22,000 decrease.
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April 1
June 1
November 1
Cost of ending inventory
Number
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Refreshers
Question 3- Inventory and Overi X
37
57
47
52
193
FIN
Cost
per unit.
$4
7
8
9
Total
$
148
399
376
468
$ 1,391
a. Calculate the cost of ending inventory using the FIFO (ending inventory shows 58 units).
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Cost of goods sold
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The beginning account balances for Terry's Auto Shop as of January 1, Year 2, follow.
Account Titles
Cash
Inventory
Common Stock
Retained Earnings
Beginning Balances
$ 6,170
3,050
7,320
1,900
The following events affected the company during the Year 2 accounting period.
1. Purchased merchandise on account that cost $4,250
Hint
2. The goods In Event 1 were purchased FOB shipping point with freight cost of $235 cash.
Print
3. Returned $490 of damaged merchandise for credit on account
4. Agreed to keep other damaged merchandise for which the company received a $205 allowance.
5. Sold merchandise that cost $2,650 for $4,830 cash.
6. Delivered merchandise to customers in Event 5 under terms…
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Journal entry worksheet
1
On December 31 Wintergreen, Inc., issued $150,000 of 7 percent, 10-year
bonds at a price of 93.25.
Note: Enter debits before credits.
Date
Dec. 31
General Journal
Cash
Discount on bonds payable
Bonds payable
Record entry
Clear entry
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Type of Asset
Building
Warehouse
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Cost
15
$813,000
%
103,000
All assets are depreciated by the straight-line method. Bramble Corp. uses a calendar year in preparing annual adjusting entries and
financial statements. After discussion, management has agreed to accept Victor's proposed changes. (The "Proposed" useful life is
total life, not remaining life.)
F5
Accumulated
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31
$154,800
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Exercise 9-16 (Static) Flexible Budgets in a Cost Center [LO9-1, LO9-2]
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared
monthly for each department. The planning budget and flexible budget for the Production Department are based on the following
formulas, where g is the number of labor-hours worked in a month:
6.25/10
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Cost Formulas
Direct labor
$15.80g
$8,200 + $1.60g
$6,400 + $0.80g
$1,100 + $0.40g
$23,000 + $3.70g
Scored
Indirect labor
Utilities
Supplies
Equipment depreciation
Factory rent
Property taxes
Factory administration
$8,400
$2,100
$11,700 +…
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Given the following:
January 1 inventory
April 1
June 1
November 1
Cost of ending inventory
Number
purchased
cra
Question 4 - Inventory and Over X
52
72
62
67
253
E
Cost
per unit
$4
7
8
9
Total
$
a. Calculate the cost of ending inventory using the LIFO (ending inventory shows 73 units).
+
208
504
496
603
$ 1,811
b. Calculate the cost of goods sold using the LIFO (ending inventory shows 73 units).
Cost of goods sold
O
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Return to the original data. Monk Builders has just signed a contract with the state government to replace the windows in low-
income housing units throughout the state. Monk needs 80,000 windows to complete the job and has offered to buy them from
Wilson at a price of $120.00 per window. Monk will pick up the windows at Wilson's plant, so Wilson will not incur the $2 per
window shipping charge. In addition, Wilson will not need to pay a distributor's commission, since the windows will not be sold
through a distributor.
Calculate the contribution from special order, contribution lost from regular sales and the net…
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What is the holding period return for the year on a bond with a par value of $1,000 and a coupon rate of 8.5% if its price at the
beginning of the year was $1,215 and its price at the end of the year was $1,020? Assume interest is paid annually.
Multiple Choice
-11.00%
-10.78%
--9.05%
10.50%
O O O 0
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Products X, Y, and Z are produced from the same process at a cost of $5,880. Five thousand pounds of raw material yields 2,600 X, 3,600 Y,
and 2,100 Z. Selling prices are: X $2 per unit, Y $4 per unit, and Z valueless. The ending inventory of X is 72 units. What is the value of the
ending inventory if joint costs are allocated using net realizable value?
Multiple Choice
$24.87.
$34.40.
$43.20.
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Land
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Inventory
$ 229,500
306,000
612,000
382,500
No
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TB Problem 10-213 (Algo) Watson Company purchased assets...
Watson Company purchased assets of Holmes Limited at auction for $1,400,000. An independent'appraisal of the fair value of the
assets acquired is listed below:
Required:
Prepare the journal entry to record the purchase of the assets.
Note: If no entry is required for a transaction/event, select "No journal entry required" in the first account field.
View transaction list View journal entry worksheet
Transaction
1
Land
Building
Calamar
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General Journal
Prey
L
BBA
RUM
Debit
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306.000
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For each of the following separate situations, determine how much revenue is recognized in December (using accrual basis
accounting).
a. On December 7, Oklahoma City Thunder sold a $124 ticket to a basketball game to be played in March.
b. Tesla sold and delivered a $92,000 car on December 25. The customer will not pay until February.
c. Deloitte signs a contract on December 1 to provide 40 days of advisory services with receipt of $44,000 due at the end of the
contract. On December 31, 75% of the services have been completed.
Situations
Revenue recognized
a. Sale of a ticket to a basketball game
b. Sale of a car on credit
c. Contract to provide advisory services
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1th ed X V VitalSource: Thank You for Your X
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Cash flows during the first year of operations for the Harman-Kardon Consulting
Company were as follows: Cash collected from customers, $340,000; Cash paid for
rent, $40,000; Cash paid to employees for services rendered during the year,
$120,000; Cash paid for utilities, $50,000.
In addition, you determine that customers owed the company $60,000 at the end
of the year, and no bad debts were anticipated. Also, the company owed the gas and
electric company $2,000 at year-end, and the rent payment was for a two-year period.
Calculate accrual net income for the year.
Jul 17, 2023, 10:38 PM
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Exercise 7-16 (Algo) Record amortization expense (LO7-5)
On January 1, 2024, Weaver Corporation purchased a patent for $255,000. The remaining legal life is 20 years, but the company
mates the patent will be useful for only six more years. In January 2026, the company incurred legal fees of $75,000 in
successfully defending a patent infringement suit. The successful defense did not change the company's estimate of useful life.
Weaver Corporation's year-end is December 31.
Required:
1. Record the purchase in 2024; amortization in 2024; amortization in 2025; legal fees in 2026; and amortization in 2026.
2. What is the balance in the Patent account at the end of 2026?
Complete this question by entering your answers in the tabs below.
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Labor Variances.
Verde Company produces wheels for bicycles. During the year, 656,000 wheels were produced. The actual labor used was 364,000 hours at $9.20 per hour. Verde
has the following labor standards: 1) $10.40 per hour; 2) 0.48 hour per wheel.
Required:
1. Compute the labor rate variance.
2. Compute the labor efficiency variance.
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Entries for notes payable
Bennett Enterprises issues a $660,000, 45-day, 9%, note to Spectrum Industries for merchandise inventory.
Assume a 360-day year. If required, round your answers to the nearest dollar.If an amount box does not require an entry, leave it blank.
a. Journalize Bennett Enterprises' entries to record:
1. the issuance of the note.
2. the payment of the note at maturity.
2
b. Journalize Spectrum Industries' entries to record:
1. the receipt of the note.
2. the receipt of the payment of the note at maturity.
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QUESTION 6
On 1.1.2017, MEERA Bhd grants to an employee the right to choose either 12,000 shares or
cash payment equal to the value of 10,000 shares (phantom shares). The grant conditional
upon the employee remaining in the company's employ for three years. If the employee
chooses the share alternative, the shares must be held for three years after vesting date.
At grant date, the company's share price is RM5.00. At the end of year 2017, 2018 and 2019,
the share price is RM5.20, RM5.60 and RM6.20, respectively. After taking into account the
post-vesting transfer restrictions, the grant date fair value of the share alternative is RM4.90.
MEERA shares have a nominal value of RM1 each.
Required:
a) Compute the amounts of expense and the related liability and equity…
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Question 8 of 15
Current Attempt in Progress
Crane Company has completed all of its operating budgets. The sales budget for the year shows 52,000 units and total sales of
$2,340,000. The total unit cost of producing one unit is $20. Selling and administrative expenses are expected to be $312,000. Interest
is estimated to be $10,400. Income taxes are estimated to be $208,000.
Prepare a budgeted multiple-step income statement for the year ending December 31, 2022.
CRANE COMPANY
Budgeted Income Statement
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