Answer and Explanation:
The journal entry is
Salaries and Wages Payable $50,000
Salaries and Wages Expense $25,000
To Cash $75,000
(Being cash paid is recorded)
Here salaries & wages payable and salaries & wages expense is debited as it decreased the liabilities & increased the expense while the cash is credited as it decreased the assets
Castle Leasing Company signs a lease agreement on January 1, 2020, to lease electronic equipment to Jan Way Company. The term of the non-cancelable lease is 2 years, and payments are required at the end of each year. The following information relates to this agreement.
1. Jan Way has the option to purchase the equipment for $16,000 upon termination of the lease. It is not reasonably certain that Jan Way will exercise this option.
2. The equipment has a cost of $120,000 and fair value of $160,000 to Castle Leasing. The useful economic life is 2 years, with a residual value of $16,000.
3. Castle Leasing desires to earn a return of 5% on its investment.
4. Collectibility of the payments by Castle Leasing is probable. Instructions
a. Prepare the journal entries on the books of Castle Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021.
b. Assuming that Jan Way exercises its option to purchase the equipment on December 31, 2021, prepare the journal entry to record the sale on Castle Leasing's books.
Answer:
A. 01-01-2020
Dr Lease receivable $160,000
Dr Cost of goods sold $105,488
Cr Sales $145,488
Cr Inventory $120,000
12/31/20
Dr Cash $78,244
Cr Lease receivable $70,244
Cr Interest revenue $8,000
12/31/21
Dr Cash $78,244
Cr Lease receivable $73,756
Cr Interest revenue $4,488
B. Dec 31,2021
Dr Cash $ 16,000
Cr Sales revenue $ 16,000
Explanation:
Preparation of the journal entries
First step is to Compute the annual payments
Present Value of lease payment
Fair value $160,000
less: present value of residual value $14,512
(16000*0.90703)
Present value of lease payment $145,488
Annual lease payment (145488/1.85941) = $78,244
Present value of $ 1 at 5 % 2 periods = 0.90703
Present value of an ordinary annuity of $ 1 at 5 % 2 periods = 1.85941
Second step is to computer the Lease Amortization Schedule
CASTLE LEASING COMPANY (Lessor)
Lease Amortization Schedule
1/1/20 $160,000
12/31/20 $78,244 $8,000 $70,244 $89,756
12/31/21 $78,244 $4,488 $73,756 $16,000
12/31/21 $16,000 0 $16,000 0
12/31/20
($160,000*5%)=$8,000
$78,244-$8,000=$70,244
$160,000-$70,244=$89,756
12/31/21
($89,756*5%)=$4,488
$78,244 -$4,488=$73,756
$89,756-$73,756=$16,000
Lease Receivable = ($78,244 × 1.85941) + ($16,000 × 0.90703)
Lease Receivable = $160,000
Cost of Goods Sold = $120,000 - ($16,000 × 0.90703)
Cost of Goods Sold= $105,488
Sales Revenue = $160,000 - (16,000 × 0.90703) Sales Revenue = $145,488
Now let prepare the JOURNAL ENTRIES
A. Preparation of the journal entries on the books of Castle Leasing to reflect the payments received under the lease and to recognize income for the years 2020 and 2021.
01-01-2020
Dr Lease receivable $160,000
Dr Cost of goods sold $105,488
Cr Sales $145,488
Cr Inventory (given) $120,000
( To record lease )
12/31/20
Dr Cash $78,244
Cr Lease receivable $70,244
Cr Interest revenue $8,000
($160,000*5%)
(To record interest revenue for Dec 2020)
12/31/21
Dr Cash $78,244
Cr Lease receivable $73,756
Cr Interest revenue $4,488
(To record interest revenue for Dec 2021)
B. Preparation of the journal entry to record the sale on Castle Leasing's books.
Dec 31,2021
Dr Cash $ 16,000
Cr Sales revenue $ 16,000
( To record sale on castle leasing's books )
DW has an ending Retained Earnings balance of $51,600. If during the year DW paid dividends of $4,100 and had net income of $21,100, then what was the beginning Retained Earnings balance
Answer:
$34,600
Explanation:
The computation of beginning retained earnings balance is seen below:
But we know that;
Ending balance of retained earnings = Beginning balance of retained earnings + Net income - Dividend paid
$51,600 = Beginning retained earnings + $21,100 - $4,100
Beginning retained earnings = $51,600 - $21,100 + $4,100
Beginning retained earnings = $34,600
3. The media consumer who gets news and information in a crossover fashion, from a variety of sources is known as a(n) _______________ consumer.
Answer:
Hybrid
Explanation:
Waterway Industries has 24000 units in beginning finished goods. If sales are expected to be 130000 units for the year and Waterway desires ending finished goods of 30000 units, how many units must the company produce
Answer:
136,000 units
Explanation:
Given the following information,
Beginning finished goods = 24,000 units
Sales = 130,000 units
Ending finished goods = 30,000 units
Computation of units the company must produce.
= Sales + Ending finished goods - Beginning finished goods
= 130,000 + 30,000 - 24,000
= $136,000 units
Therefore, the company must produce 136,000 units
Calista works as an IT manager for an engineering firm. When it comes time to replace the company's computers, the firm's president gives Calista a budget and tells her to pick computers that will best suit the company's needs. This is an example of making a decision through:_______
a. consensus.
b. expert opinion.
c. majority vote.
d. minority decision.
Answer:
b. expert opinion.
Explanation:
Remember, we are told that Calista has the job role of IT (Information Technology) manager.
Hence, in such an organization, we would expect the IT manager to provide the best expert opinion on the best computers that would replace the present computers while sticking to the company's budget.
If a firm covers the cost of production for its product and also adds a 15% profit to the price it charges its customer, then this is considered ________. Group of answer choices break-even regulation price-cap regulation Average cost pricing regulation cost-plus regulation
Answer:
cost-plus regulation
Explanation:
Pricing regulation is the strategy the a government uses in controlling the price of commodities at the retail markets and other stages in the production process.
The cost-plus regulation of prices allows businesses the set prices on goods that will meet up with the cost of production of the good and also add a normal rate of profit.
In the given instance the firm covers the cost of production for its product and also adds a 15% profit to the price it charges its customer.
This is cost-plus regulation.
The supply and demand model assists in analyzing the: relationship between education and employment. growth in the overall level of economic activity. determinants of market price and quantity. connection between trade and U.S. employment levels.
Answer: determinants of market price and quantity.
Explanation:
The supply and demand model is important as it helps in analyzing the impact of the variables like price, quantity, tastes, preferences, the prices of related goods, technology, etc.
The The supply and demand model assists in getting the equilibrium price and the equilibrium quantity of a good in the market. Therefore, the correct option is C.
If the U.S. engages in free trade and the international price of skateboards is $75, it would import _____ skateboards from the rest of the world.
ifthe U.S. engages in free trade and the international price of skateboards is $75, it would import _____ skateboards from the rest of the world.
Explanation:
answer would be 210
Why is it a good idea to have a security policy that defines the incident response process in your organization
(ANSWER FAST)(35 POINTS)
The trade-off for working long hours, tough shifts, and handling tragedy with grace is that many health care jobs are some of the jobs out there.
highest paying
most highly respected
most famous
most stressful
Answer:
highest paying
Explanation:
not sure tho tell me if im right
Pearson Motors has a target capital structure of 45% debt and 55% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 12%, and its tax rate is 25%. Pearson's CFO estimates that the company's WACC is 12.20%. What is Pearson's cost of common equity
Answer:
14.82 %
Explanation:
WACC = Cost of equity x Weight of equity + Cost of Debt x Weight of Debt
where,
After tax cost of debt = Interest x (1 - tax rate)
= 12 % x (1 - 0.25)
= 9 %
therefore,
Let the Cost of equity be Ce
12.20% = Ce x 0.55 + 9 % x 0.45
12.20% = 0.55 Ce + 4.05
Ce = 14.82 %
thus
Pearson's cost of common equity is 14.82 %
The margin of safety ratio is computed as actual sales divided by break-even sales. is used to determine the break-even point. indicates what percent decline in sales could be sustained before the company would operate at a loss. measures the ratio of fixed costs to variable costs.
Answer:
indicates what percent decline in sales could be sustained before the company would operate at a loss.
Explanation:
Since, Margin of safety ratio = Expected Sales - Break even sales
therefore,
The correct statement is : The margin of safety ratio indicates what percent decline in sales could be sustained before the company would operate at a loss.
ou plan to deposit $5,900 at the end of each of the next 20 years into an account paying 10.8 percent interest. a. How much will you have in your account if you make deposits for 20 years
Answer:
$326,622.73
Explanation:
Calculation to determine How much will you have in your account if you make deposits for 20 years
Using this formula
Future value = Annuity × {( 1 + interest rate) ^ time period - 1} ÷ interest rate
Future value = $5,900 × {( 1 + 0.097 ^ 20 years - 1} ÷ 0.097
Future value= $5,900 × 55.3597842916
Future value= $326,622.73
Therefore the amount you will have in your account if you make deposits for 20 years is $326,622.73
The Heating Division of Kobe International produces a heating element that it sells to its customers for $42 per unit. Its variable cost per unit is $21, and its fixed cost per unit is $9. Top management of Kobe International would like the Heating Division to transfer 14,500 heating units to another division within the company at a price of $30. Assume that the Heating Division has sufficient excess capacity to provide the 14,500 heating units to the other division. What is the minimum transfer price that the Heating Division should accept
Answer:
$21
Explanation:
The computation of the minimum transfer price that should be accepted is shown below:
here the minimum transfer price should be equivalent to the variable cost per unit i.e. $21
Because the fixed cost is irrelevant in the given situation as it is remain fixed whether the production is increased or not
hence, the minimum transfer price is $21
Hart Attorney at Law experienced the follwoing transactions in 2016, the first year of operations:
1. Accepted $36,000 on 4/1/16, as a retainer for services to be performed evenly over the next 12 months
(2) Performed legal services for cash of $54,000
(3) Purchased $2,800 of office suppies on account
(4) Paid $2,400 of the amount due on accounts payable
(5) Paid a cahs dividend to the stockholders of $5,000
(6) Paid cash for operationg expenses of $31,000
(7) Determined that at the end of the accounting period $200 of office supplies remained on hand
(8) On 12/31/16, recognized the revenue that had been earned for services performed in accordance with Transaction 1
Problem: Show the effects of the events on the fianncial statements using a horizontal statement model.
Answer:
The accounting equation therefore holds as follows:
Total assets = Total liabilities + Total Stockholders’ Equity = $51,800
Explanation:
Note: See the attached excel file for the horizontal statement model showing the effects of the events on the financial statements.
The following calculations are made in the attached excel:
For Event 7, we have:
Office supplies = Amount of office supplies purchased - Office supplies remained on hand = $2,800 - $200 = $2,600
For Event 8, we have:
Amount of revenue that is recognized = Number of months from April 1 to December 31 * (Amount accepted on April 1 / Number of months in year) = 9 * ($36,000 /12) = 9 * $3,000 = $27,000
Also, the following can be obtained from the attached excel file:
Total assets = $51,600 + $200 = $51,800
Total liabilities = $400 + $9,000 = $9,400
Total Stockholders’ Equity = $42,400
Total liabilities + Total Stockholders’ Equity = $9,400 + $42,400 = $51,800
The accounting equation therefore holds as follows:
Total assets = Total liabilities + Total Stockholders’ Equity = $51,800
How much total interest will she pay over the course of the mortage for this house
Answer:
How are we suppose to know??????
Explanation:
For airlines that sell flights from New York City to Boston, Amtrak trains are primarily a __________ Group of answer choices Potential entrant Buyer Supplier Rival Substitute product
Answer: rival
Explanation:
For airlines that sell flights from New York City to Boston, Amtrak trains are primarily a rival.
A rival in a business environment simply refers to ones competitor. In this case, the companies are all in the same industry and competes against each other, seeks competitive advantage over one another and seeks to capture a bigger market.
Your business sponsor and customer informed you that you have to deliver your project much sooner than anticipated. When you break the news to your team, they are not happy with the decision for they are concerned that the project will now fail. Using the information you learned from readings, what can you do as a leader to ensure your project team that this is the right thing to do
Answer:
Motivate the team
Explanation:
The team needs to be motivated to be working hard and the project does not fail. The workers can be motivated with extensive work plan which is also needs to be achievable, split the work in small tasks and goals so the workers stay motivated while working. Attach monetary rewards for completing the tasks on time, overtime can also be included with enough motivating $/hour.
Sales $3,400,000 $2,100,000 Contribution margin $1,500,000 $900,000 Divisional segment margin $1,000,000 $300,000 Net operating income last year for SegR-1882 Corporation was $550,000. In last year's income statement segmented by division, what were SegR-1882's total common fixed expenses
Answer: $750,000
Explanation:
Based on the information given, in last year's income statement segmented by division, SegR-1882's total common fixed expenses will be calculated thus:
Note that Net operating income = Total segment margin - Common fxed expenses
Therefore, Common fixed expense = Net operating income - Total segment margin
Common fixed expenses:
= $1,300,000 - $550,000
= $750,000
Therefore, common fixed expenses is $750,000
Note that total segment margin = $1,000,000 + $300,000 = $1,300,000
Stan is going to work for the next 30 years and then retire. Starting the day he retires, he would like to withdraw $90,000 per year (in monthly installments) from an investment account for a twenty-five year retirement. At the end of his retirement, he would like to leave a bequest of $100,000 to his heirs. He currently has $10,000 in his investment account for these purposes. Stan plans to save for retirement by making monthly deposits into the investment account, beginning two years from now and ending the month before he retires. The investment account pays 9 percent compounded monthly. Construct a flexible spreadsheet model to answer the following questions:
1. How much must Stan invest each month to accomplish his retirement goals?
2. If Stan's employer will contribute $0.50 for every $1.00 he invests, how much of the deposit in #1 will Stan have to contribute?
Stan is going to work for the next 30 years and then retire. Starting the day he retires, he would like to withdraw 90,000 per year (in monthly installments) from an investment account for a twenty-five year retirement. At the end of his retirement, he would like to leave a bequest of90,000peryear(inmonthlyinstallments)fromaninvestmentaccountforatwenty−fiveyearretirement.Attheendofhisretirement,hewouldliketoleaveabequestof100,000 to his heirs. He currently has $10,000 in his investment account for these purposes. Stan plans to save for retirement by making monthly deposits into the investment account, beginning two years from now and ending the month before he retires. The investment account pays 9 percent compounded monthly. Construct a flexible spreadsheet model to answer the following questions:
1. How much must Stan invest each month to accomplish his retirement goals?
2. If Stan's employer will contribute 0.50 for every0.50forevery1.00 he invests, how much of the deposit in #1 will Stan have to contribute?
If from 1980 to 2005, the average growth rate of aggregate output for the economy of Groland was 4.5%, while over the same time, Groland's population grew an average of 2.0% per year, then aggregate output per person grew at an average of _____ each year
Question 2 of 8
2.0 Points
Income earned by the business from activities unrelated to its primary operations would be
classified as........ in the statement that measures its performance for a particular period.
Answer:
This type of income is known as non-operating income in the financial statements
Explanation:
Non-operating income, as the world implies, is the income that a firm earns from activities that are not related to its main economic activity. An example would be a mall, whose main activity is the rental and management of commercial real estate, earning some income from short-term investments in the secondary market. This interest would be reported as non-operating income, and would be treated as such for financial, accounting, and tax purposes.
Bob went out with his friends to celebrate his birthday. They went to a bar where they drank copious quantities of alcohol. In the morning, Bob had not slept and was still obviously intoxicated. He found his way to a car dealership near his house and entered into a contract to buy a Mercedes Benz SUV for the cost of $140,000.00. The car salesman could smell alcohol on Bob's breath, he noticed his eyes were bloodshot and "glossy" while they were signing the papers relating to the sale, and when Bob left he could see that he was unsteady on his feet. Bob left the dealership and went home and went to bed. He slept for two days. The car salesman from the dealership called Bob 4 days later to tell him that his vehicle was ready for pick up. Bob had no memory of the buying any car.
In these circumstances:
A. the contract is void ab initio because Bob lacked capacity to contract due to his intoxication
B. Bob can avoid or repudiate the contract within a reasonable time after he regains capacity and sobers up
C. Bob cannot avoid the contract because he is responsible for his intoxication and the car salesman had no way of knowing Bob was intoxicated at the time of entering into the contract
Sandhill Co. purchased machinery that cost $2800000 on January 4, 2019. The entire cost was recorded as an expense. The machinery has a 9-year life and a $180000 residual value. The error was discovered on December 20, 2021. Ignore income tax considerations.
Before the correction was made, and before the books were closed on December 31, 2013, retained earnings was understated by:____.
Answer:
$2,217,777.78
Explanation:
The computation is shown below:
The accumulated depreciation amount till 31 Dec 2013
= ($2,800,000 - $180,000) ÷ 9 × 2
= $582,222.22
Now the expenses recorded as the purchase is $2,800,000
so,
The Retained earnings understated by
= $2,800,000 - $582,222.22
= $2,217,777.78
Knowledge Check 01 Feline Watch Company makes wrist watches out of silver metal sheets. Feline sold 200 watches in the month of June. It projects July and August sales to be 400 and 600 respectively. The company`s policy is to have 50% of next month`s sales in inventory. If the June ending inventory of watches is 200, how many watches must be produced in July
Answer:
the number of watches to be produced in July is 500
Explanation:
The calculation of the number of watches to be produced in July is given below;
Units Expected to be sale 400
Add: Desired ending inventory 300 (50% of 600)
Total available 700
Less: Beginning Inventory -200
Units to be produced 500
Hence, the number of watches to be produced in July is 500
organization which has no interaction with its external environment is called
Answer:
Closed system
Explanation:
An organization that has no interaction with its external environment is called a "Closed System"
A Closed System is a form of management system whereby the organization is operated or run solely on its own without any form of interaction or influence from the outside world. This is the opposite of the Open system.
Hence, Closed System operates such that the system doesn't affect the outside and the outside doesn't affect it either. It also regulates and influences itself.
If a member firm believes that a senior citizen with an account at the firm is being financially exploited, the member would contact the client's A attorney B closest relative C trusted contact person D registered representative
Answer:
C trusted contact person
Explanation:
If a member firm believes that a senior citizen with an account at the firm is being financially exploited, the member would contact the client's "trusted contact person."
Option A is not correct because contacting the client's attorney would lead to legal action, which may affect the firm as well.
Option B is not correct because contacting the client's close relative might not be in the best interest of the client.
Option D is not correct because contacting the client's registered representative might not yield the expected outcome as the registered representative's main function is to involve in trading investment products and securities.
Hence, option C is correct because a trusted contact person is a person that the client has authorized the brokerage firm to contact in a situation such as when the client account may be exposed to financial exploitation.
KLM Corporation's quick assets are $6,123,000, its current assets are $13,440,000 and its current liabilities are $8,144,000. Its acid-test ratio equals:
Answer:
the acid-test ratio is 0.75 times
Explanation:
The computation of the acid-test ratio is shown below:
We know that
Acid-test ratio is
= Quick assets ÷ current liabilities
= $6,123,000 ÷ $8,144,000
= 0.75 times
Hence, the acid-test ratio is 0.75 times
basically we divided the quick assets from the current liabilities so that the acid-test ratio could come
The common stock of Swifty Inc. is currently selling at $120 per share. The directors wish to reduce the share price and increase share volume prior to a new issue. The per share par value is $10; book value is $75 per share. 10.50 million shares are issued and outstanding.
Required:
Prepare the necessary journal entries assuming the following.
a. The board declares and issues a 2-for-1 stock split.
b. The board declares and issues a 100% stock dividend.
c. Briefly discuss the accounting and securities market differences between these two methods of increasing the number of shares outstanding.
Answer:
A. No Entry
No Entry
B. Dr Retained Earnings $105,000,000
Cr Common Stock Dividend Distributable $105,000,000
Dr Common Stock $105,000,000
Cr Common Stock $105,000,000
Explanation:
A. Preparation of the necessary journal entries assuming the The board declares and issues a 2-for-1 stock split.
No Entry
No Entry
B. Preparation of the necessary journal entries assuming theThe board declares and issues a 100% stock dividend.
Dr Retained Earnings $105,000,000
Cr Common Stock Dividend Distributable $105,000,000
($10 x 10.50 million)
(To record the declaration)
Dr Common Stock $105,000,000
Cr Common Stock $105,000,000
(To record the distribution)
If the labor force averaged 237 million in 2008–2011, by how much in percentage terms did the state and local layoffs described in the "In The News" add to the national unemployment rate, assuming all laid-off workers were actively seeking work?
Instructions: Enter your response rounded to two decimal places.
________ %
Answer:
Follows are the response to the given question:
Explanation:
unemployed people from 2008 to 2011 = 600,000
labor force from 2008 to 2011 = 237,000,000
Calculating the unemployment rate:
[tex]= (\frac{total \ unemployed \ people}{labor\ force}) \times 100[/tex]
[tex]= (\frac{600,000}{237,000,000}) \times 100\\\\= 0.0025 \times 100\\\\ = 0.25\%[/tex]
From 2008 to2011 there is 0.25% of the unemployment rate was added.