Describe the two of the asset categories in working capital. Why is working capital so important?
Q: Corporation Ltd is considering raisng additional equiry via a rights issue, in the amount of…
A: Existing shareholders are extended an opportunity to acquire extra new shares of the firm via the…
Q: Given a discount rate of 6.3 percent per year, what is the value at Year 7 of a perpetual stream of…
A: It has been provided: Discount rate = 6.3% Perpetual stream = $2,350 Starting at the year 15…
Q: Muy Bueno Bakery sells its special chocolate cake for $37. The total cost to produce the cake is…
A: The selling price is the amount at which the product is sold to the buyer. The variable costs is the…
Q: Sarika(35) is single. Her 2020 federal itemized deductions totaled $14,400, of which she claimed…
A: Itemized Deduction: Itemized deduction is the amount that taxpayers can deduct from their adjusted…
Q: Determine the amount to be paid in full settlement of each of two invoices, (a) and (b), assuming…
A: Full settlement refers to a process in which dues payable to an employee is to be calculated who…
Q: e Properties LLC. Alpine builds and manages rental real estate, and Ray and Matias each works full…
A: Partnership refers to the legal form of agreement between two or more persons who decide to mutually…
Q: Which of the following reflects the effect of the year-end adjustment to record estimated…
A: These are the accounting transactions that are having a monetary impact on the financial statement…
Q: Using the following information, determine the activity rate for the purchasing activity. Activity…
A: Under activity based costing, cost are calculated for each activity based on their consumption or…
Q: Baxter Company reported a net loss of $16,324 for the year ended December 31. During the year,…
A: Cash Flow from Operating Activities - Cash Flow Statement starts with the operating activities. It…
Q: Describe how the nature of evidence used to evaluate the control environment differs from the nature…
A: ANSWER:- For many control activities, documentation of their performance is more objectively…
Q: A building is acquired on January 1 at a cost of $ Compute depreciation expense for the first three…
A: The depreciation expense is charged on fixed assets as reduction in the value of fixed assets with…
Q: On December 31, Year 1, the Loudoun Corporation estimated that 3% of its credit sales of $112,500…
A: The answer for the multiple choice question and relevant explanation are presented hereunder :…
Q: On January 1, Vera Clothing Inc. issued 10,000 shares of common stock, $5 par for $200,000. Related…
A: 1. Legal and accounting fees and administrative fee of $5,000 each will be deducted…
Q: Unearned revenues Example Assume that on September 30, 2022, Iberia sells 500 tickets from Madrid to…
A: Journal Entry :— It is an act of recording transaction in books of account when transaction…
Q: EastGate Physical Therapy Inc. is planning its cash payments for operations for the first quarter…
A: Cash payments are those which are paid in the form of cash. Cash payment by any entity could be made…
Q: Laker Company reported the following January purchases and sales data for its only product. The…
A:
Q: 1. Madeoff donated stock (capital gain property) to a public charity. He purchased the stock three…
A: As per the Honor code of Bartleby we are bound to given the answer of first question part only,…
Q: For 20Y2, McDade Company reported a decline in net income. At the end of the year, T. Burrows, the…
A: Horizontal analysis means to compare the financial position of an entity's current year with its…
Q: Listed below are five items that may—or may not—require disclosure in the notes that accompany…
A: GAAP The term generally recognized accounting principles is abbreviated as GAAP. It is a collection…
Q: On September 1, Year 1, West Company borrowed $30,000 from Valley Bank. West agreed to pay interest…
A: Answer:- Option (1) 500 is correct answer Explanation:- Accounts Payable $ 30,000 Interest…
Q: The manufacturing overhead budget at Franklyn Corporation is based on budgeted direct labor-hours.…
A: Flexible budget is prepared to analyze the profitability of the business at different levels of…
Q: Flounder's Recording Studio rents studio time to musicians in 2-hour blocks. Each session includes…
A: Total cost is the cost incurred including both the product cost and the period cost . Thus it is the…
Q: Vaughn's Market recorded the following events involving a recent purchase of inventory: Received…
A: Received goods for $132,000 terms 2/15, n/30 - i.e., merchandise inventory (MI) and accounts Payable…
Q: rom April 1 through October 31, Coles County Highway Department hires temporary employees to mow and…
A: Use the information from the high- and low-volume months to develop a cost-estimating equation for…
Q: Clarissa company’s accounting records provided the following information: 1/1/20B 12/31/20B Current…
A: The economic resources owned by a firm are called assets. The claims of outsiders (other than…
Q: which of the following occurs if a company decreases its selling price per unit? a. net income…
A: The contribution margin is calculated as difference between sales and variable costs. The…
Q: Flint Corporation makes a commercial-grade cooking griddle. The following information is available…
A: Fixed manufacturing overhead per unit = Fixed manufacturing overhead/Annual volume Fixed selling and…
Q: Harding Corporation acquired real estate that contained land, building and equipment. The property…
A: The Asset like land, building and equipment are the fixed assets for the firm and as shown under the…
Q: Write up a three column cash book from the following details: March 1 Balances brought…
A:
Q: 4. Prepare a detailed overhead variance report that shows the variances for individual items of…
A: SOLUTION:- 4.…
Q: C. December 1. Wrote check to establish a petty cash fund, $200 CK NO. 21. d. December 9. Used debit…
A: Journal Entry: Journalizing entails recoding business transactions in the Journal in a chronological…
Q: 4) On January 1, 2020, Ehrlich had outstanding 300,000 shares of $2 par value common stock and…
A: Introduction: Basic earnings per share is the earnings per share available to common stockholders'…
Q: hammed is in serious financial difficulty and is unable to meet current unsecured obligations of…
A: There are situations in the life of business when one is able to pay the obligations and due to…
Q: 7) ABC Company purchased $1,200,000 of 7%, 5-year bonds from XYZ, Inc. on January 1, 2021, with…
A: Bond is that debt instrument which is used by the organisation to finance its long term fund needs,…
Q: On January 1, Year 2, Kincaid Company's Accounts Receivable and the Allowance for Doubtful Accounts…
A: The answer for the multiple choice question and relevant explanation are presented hereunder : There…
Q: Required d: Assume monthly volume of 27,000 units. What is the margin of safety percentage…
A: Introduction:- CVP analysis is used to identify the changes in costs and volume affect a company's…
Q: Colter Company prepares monthly cash budgets. Relevant data from operating budgets for 2022 are as…
A: SCHEDULE OF EXPECTED COLLECTION FROM CUSTOMERS Schedule of Expected Collection from Customers is…
Q: When preparing Statement of Cash Flows, the following items can be classified as investing…
A: A cash flow statement indicates cash inflow and cash outflow information for a particular time…
Q: labor (7 hours @ $14 per hour) e overhead (7 hours@ $6 per hour) verhead (7 hours @ $12 per hour). d…
A: Controllable variance is the difference of the actual overheads cost and budgeted overhead cost for…
Q: Assuming a perpetual inventory system and using the weighted average method to determine the…
A: Introduction:- Calculation of Weighted average cost per unit on October-29 as follows:- =Weighted…
Q: On January 1, Year 1, Marino Moving Company paid $64,000 cash to purchase a truck. The truck was…
A: Introduction: As per straight-line method, annual depreciation is charged on the basis of expected…
Q: Jack and Rose are partners sharing profits and losses equally. The terms of their agreement are: (i)…
A:
Q: Parwin Corporation plans to sell 36,000 units during August. If the company has 14,500 units on hand…
A: Units Produced :— It is the number of units that must be produced to generate desired sales units.…
Q: Francis works for a local fly fishing shop. The shop allows employees to purchase two fly rods per…
A: Working :- 1) Calculation of discount when sold to francis :- Retail price of rod - price at which…
Q: Which of the following statements is true of corporations in 2021? Select one: a. Capital losses of…
A: ANSWER ;- Option (c) is correct If a corporation has a long-term capital loss that is carried back,…
Q: Travel Warehouse Ltd. distributes suitcases to retail stores. At the end of June, Travel Warehouse's…
A: Perpetual Inventory System Through the use of point-of-sale systems, perpetual inventory systems…
Q: ndigo Corp. carries an account in its general ledger called Investments, which contained debits for…
A: Available-for-Sale Securities(AFS) AFSs are debt or equity securities that are acquired with the…
Q: Expo Lube is interested in producing and selling an industrial line of oil filters. Market research…
A: Target cost is the estimated cost by deducting the desired profit margin from the competitive market…
Q: Danielle purchased a home with her husband, Neville, in March of 2021 for $700,000 in a separate…
A: As per the given information: Purchased a home in March of 2021 - $700,000 In June of 2021…
Q: Smith Company reports the following information: Cost of goods manufactured $68,250 Direct materials…
A: The cost of goods manufactured includes the total cost of goods that are finished during the period.…
Describe the two of the asset categories in
Why is working capital so important?
A growing business typically has cash flow problems because profits tend to be reinvested
back into the business. Describe how you would solve that.
4. What role does inventory management play in an overall business plan and describe
the benefits of just in time inventory management.
5. Describe one of the methods for managing cash disbursements or cash receipts and
how it impacts profitability.
Step by step
Solved in 2 steps
- A fellow student studying managerial accounting says. The net present value (NPV) weighs early receipts of cash much more heavily than more distant receipts of cash. Do you agree or disagree? Why?Consider the dilemma you might someday face if you are the chief financial officer of a company that is struggling to maintain a positive cash flow, despite the fact that the company is reporting a substantial positive net income. Maybe the problem is so severe that there is often insufficient cash to pay ordinary business expenses, like utilities, salaries, and payments to suppliers. Assume that you have been asked to communicate to your board of directors about your companys year, in retrospect, as well as your vision for the companys future. Write a memo that expresses your insights about past experience and present prospects for the company. Note that the challenge of the assignment is to keep your integrity intact, while putting a positive spin on the situation, as much as is reasonably possible. How can you envision the situation turning into a success story?1. Describe the two of the asset categories in working capital. 2. Why is working capital so important?3. A growing business typically has cash flow problems because profits tend to be reinvested back into the business. Describe how you would solve that.4. What role does inventory management play in an overall business plan and describe the benefits of just in time inventory management.5. Describe one of the methods for managing cash disbursements or cash receipts and how it impacts profitability.
- 2. Why is working capital so important?3. A growing business typically has cash flow problems because profits tend to be reinvested back into the business. Describe how you would solve that.4. What role does inventory management play in an overall business plan and describe the benefits of just in time inventory management.5. Describe one of the methods for managing cash disbursements or cash receipts and how it impacts profitability.Wellson Ltd. has current assets, including cash, accounts receivable, and inventory, and current liabilities, including accounts payable and short-term notes payable. Wellson manages its working capital by focusing on management of current assets. Wellson has effective systems in place for granting credit to customers, collecting overdue accounts, and managing inventory. (a) Discuss why management of working capital is important for effective business operations. (b) Discuss how Wellson can improve its management of working capital1. What is a Working capital management?a. It is the placement of the firm’s debt and equity issues.b. It is the financing and management of the firm’s current assets.c . It is also known as inventory management .d. It is the management of the firm’s capital assets. 2. What is the transactional motive of holding cash?a. To keep a cash reserve for purchasing goods and services to balance out the cash inflows and outflows.b. To keep the cash for all the transactions made during a periodic term.c. To keep the cash for transactions mandatory for day to day activities. d. To keep the transactions for foreign trading.3. Below are all components of working capital except:a. Cash c. Marketable Securities b. Inventories d. Notes Payable 4. In what order will a company’s current assets appear on a classified balance sheet?a. Alphabetical order c. From largest to smallest amountb. Company’s choice d. Order of Liquidity 5. Which of the following would not be important in examining the firm's…
- 3. A growing business typically has cash flow problems because profits tend to be reinvested back into the business. Describe how you would solve that.4. What role does inventory management play in an overall business plan and describe the benefits of just in time inventory management.5. Describe one of the methods for managing cash disbursements or cash receipts and how it impacts profitability.Identify if it will Increase, Decrease or No effect. 1.What will happen to the company’s liquidity when some of its products are sold from inventory? 2.What happens to the owner’s assets when the company purchases equipment with its cash? 3.What happens to the owner’s assets when the company repays the bank that had lent?A. In the long run it is more important for a business to have positive cash flows from itsoperating activities, investing activities or financing activities? Why?B. Identify three factors that may cause net income to differ from net cash flows from operatingactivities.C. Describe how the Statement of Cash Flows helps investors and creditors perform each ofthe following functions: predict future cash flows; evaluate management decisions; predictthe ability to make debt payments to lenders and pay dividends to stockholders.D. Name and explain the three (3) categories of cash-flow activities.
- which of the following statements regarding free cash flow is true? a.Free cash flow measures the operating cash flow of a company after the purchase of inventory. b.Free cash flow is a valuable tool for evaluating net income. c.Free cash flow ignores productive capacity. d.None of these choices are correct.The users of financial information can understand the strength and weakness of the business concern with the help of: a.Profit and loss account b.Balance Sheet c.Statement of cash flows d.Profit and loss appropriation account *Repy fast plz***The following are goals‘andobjectives in working-capitalmanagement. Which is the LEASTACCURATE? a. Payables management includes the analysis of the business's use of trade payables and short-term non-trade payables but not long-term non-trade payables.b. Availability of money marketable securities support the cash management function by providing a return on excess cash.c. Receivable management involves setting the credit term but not the implementation of how receivables are collected.d. Inventory management allows the entity to determine the best level of this asset while balancing the risk of over- and under- stocking.
