BUSINESS COLLEGE

Effie Company uses a periodic inventory system. Details for the inventory account for the month of January, 2018 are as follows: Units Per unit price Total Balance, 1/1/18 200 $5.00 $1,000 Purchase, 1/15/18 100 5.30 530 Purchase, 1/28/18 100 5.50 550 An end of the month (1/31/18) inventory showed that 160 units were on hand. If the company uses FIFO and sells the units for $10 each, what is the gross profit for the month

Answers

Answer 1
Answer:

Answer:

the gross profit for the month is $1,180

Explanation:

FIFO Inventory System Sell the Older Inventory Acquired first followed by the Recent Acquired Inventory

Trading Account of Effie Company

Sales (240 units × $10.00)                          $2,400

Less Cost of Sales :

200 units × $5.00 :                 $1,000

40 units × $5.50    :                 $  220

Total Cost of Sales                                     ( $1,220)    

Gross Profit                                                    $1,180

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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 q is the number of labor-hours worked in a month: Cost Formulas Direct labor $16.30q Indirect labor $4,100 + $2.00q Utilities $5,100 + $0.50q Supplies $1,300 + $0.40q Equipment depreciation $18,100 + $2.50q Factory rent $8,500 Property taxes $2,700 Factory administration $13,300 + $0.60q The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 66,780 Indirect labor $ 11,680 Utilities $ 7,590 Supplies $ 3,190 Equipment depreciation $ 28,100 Factory rent $ 8,900 Property taxes $ 2,700 Factory administration $ 15,050 Required: 1. Prepare the Production Department’s planning budget for the month. 2. Prepare the Production Department’s flexible budget for the month. 3. Calculate the spending variances for all expense items.

Answers

Answer:

Packaging Solutions Corporation

1. Planning Budget

Direct labor                              $68,460

Indirect labor                            $12,500

Utilities                                       $7,200

Supplies                                     $2,980

Equipment depreciation        $28,600

Factory rent                              $8,500

Property taxes                          $2,700

Factory administration           $15,820

2. Flexible Budget

Direct labor                             $65,200

Indirect labor                            $12,100

Utilities                                       $7,100

Supplies                                   $2,900

Equipment depreciation        $28,100

Factory rent                             $8,500

Property taxes                         $2,700

Factory administration          $15,700

3. Spending Variances:

                                                  Flexible  Actual       Spending

                                                  Budget  Budget       Variance

Direct labor                             $65,200  $66,780     $1,580 U

Indirect labor                            $12,100    $11,680       $420 F

Utilities                                       $7,100    $7,590       $490 U

Supplies                                   $2,900     $3,190       $290 U

Equipment depreciation        $28,100  $28,100        $0     None

Factory rent                             $8,500   $8,500        $0     None

Property taxes                         $2,700   $2,700        $0     None

Factory administration          $15,700  $15,050        $650 F

Explanation:

a) Data and Calculations:

Planned labor-hours in March = 4,200

Actual labor-hours in March = 4,000

Cost Formulas

Direct labor $16.30q

Indirect labor $4,100 + $2.00q

Utilities $5,100 + $0.50q

Supplies $1,300 + $0.40q

Equipment depreciation $18,100 + $2.50q

Factory rent $8,500

Property taxes $2,700

Factory administration $13,300 + $0.60q

Actual Cost Incurred In March:

Direct labor                      $ 66,780

Indirect labor                     $ 11,680

Utilities                               $ 7,590

Supplies                             $ 3,190

Equipment depreciation $ 28,100

Factory rent                      $ 8,900

Property taxes                  $ 2,700

Factory administration   $ 15,050

Flexible Budget:

Direct labor $16.30 * 4,000 = $65,200

Indirect labor $4,100 + $2.00  * 4,000 = $12,100

Utilities $5,100 + $0.50 * 4,000 = $7,100

Supplies $1,300 + $0.40 * 4,000 = $2,900

Equipment depreciation $18,100 + $2.50 * 4,000 = $28,100

Factory rent $8,500

Property taxes $2,700

Factory administration $13,300 + $0.60 * 4,000 = $15,700

Planning Budget

Direct labor $16.30 * 4,200 = $68,460

Indirect labor $4,100 + $2.00 * 4,200 = $12,500

Utilities $5,100 + $0.50 * 4,200 $7,200

Supplies $1,300 + $0.40 * 4,200 $2,980

Equipment depreciation $18,100 + $2.50 * 4,200 = $28,600

Factory rent $8,500

Property taxes $2,700

Factory administration $13,300 + $0.60 * 4,200 = $15,820

Final answer:

The problem involves calculating the planning budget, flexible budget, and spending variances for the Production Department of Packaging Solutions Corporation. The planning budget is based on the expected output, the flexible budget adjusts according to actual results, and the spending variances give the difference between budgeted and actual costs.

Explanation:

The question falls under the field of cost accounting in Business studies. Here, we'll need to calculate the planning budget, the flexible budget, and the spending variances for the Production Department of Packaging Solutions Corp.

1. Planning Budget: The planning budget is based on the expected labor-hours and the production output associated with those labor-hours. In this case, the planned labor hours were 4,200.

2. Flexible Budget:

The flexible budget adjusts the planning budget to reflect actual operational results. The actual hours worked in March were 4,000, which is what we'll use for the flexible budget calculations.

3. Spending Variances:

Spending variances are the differences between what was budgeted (either in the planning budget or the flexible budget) and actual results. They can be calculated by subtracting the actual costs from the budgeted costs. This will provide insights into areas where spending was over or under the budgeted amounts.

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What is an advantage of taking out a long-term loan instead of a short-termloan?

A. A long-term loan usually requires a low debt-to-income ratio.

B. A long-term loan usually has a lower total cost.

C. A long-term loan usually has a lower interest rate.

D. A long-term loan usually requires no credit check.

Answers

One of the major advantages of taking a long-term loan is that a long-term loan usually has a lower interest rate. Therefore (C) is the correct option.

What is a long-term loan?

A long-term loan is a financial instrument with a one-year maturity. Both private and public institutions are accepting applications for this loan. Collateral is generally needed for long-term loans.

The loan's interest rate is lower than that of a short-term loan because it must be repaid over a three-to ten-year period.

Therefore, (C) is the correct option.

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pproximately how much should be accumulated by the beginning of retirement to provide a $2,500 monthly check that will last for 25 years, during which time the fund will earn 6% interest with monthly compounding?

Answers

Answer:

$388,017.16

Explanation:

The amount that shall be accumulated at the beginning of retirement to provide a $2,500 for the period of 25 years shall be determined through the present value of annuity formula which is mentioned below:

Amount that should be accumulated=R[(1-(1+i)^-n)/i]

In the given question

R=monthly check that will be received=$2,500

n=number of months during which monthly checks will be  received=25*12=300

i=interest rate compounded monthly=6/12=0.50%

Amount that should be accumulated=2500[(1-(1+0.50%)^-300)/0.50%]

                                                            =$388,017.16

1. What is the ending balance in the accounts listed below given the following transactions: a. RWV borrows $1,100,000 in the form of a note payable. b. RWV purchases land for $250,000. c. RWV builds a building for $750,000. d. RWV orders $7,500 worth of food, which will be paid for later. e. RWV provides services worth $95,000, and will bill for the services later. f. RWV pays salaries to employees totaling $45,000. g. RWV pays $7,500 towards the food it previously ordered. h. RWV uses $5,000 worth of food. i. RWV pays $17,000 of G

Answers

Answer:

RWV

Ending Account Balances:

Account Details               Debit     Credit

Notes Payable                              $1,100,000

Cash                           $30,500

Land                           250,000

Building                      750,000

Supplies (Food)             2,500

Accounts Receivable  95,000

Service Revenue                               95,000

Salaries Expense       45,000

Supplies (Food) Exp.   5,000

G                                 17,000

Totals                  $1,195,000      $1,195,000

Explanation:

a) Notes Payable

Account Details         Debit     Credit

Cash                                       $1,100,000

a) Cash Account

Account Details         Debit       Credit

Notes Payable     $1,100,000

Land      (b)                                 $250,000

Building   (c)                                 750,000

Salaries         (f)                              45,000

Supplies (Food)  (g)                         7,500

G (i)                                                 17,000

Balance c/d                                $30,500

b) Land

Account Details         Debit       Credit

Cash                     $250,000

c) Building

Account Details         Debit       Credit

Cash                    $750,000

d) Supplies (Food)

Account Details         Debit       Credit

Accounts Payable    $7,500

Supplies (Food) Expense (h)    $5,000

Balance c/d                               $2,500

Accounts Payable

Account Details         Debit       Credit

Supplies   (d)                           $7,500

Cash (g)                   $7,500

e) Accounts Receivable

Account Details         Debit       Credit

Service Revenue    $95,000

Service Revenue

Account Details         Debit       Credit

Accounts Receivable  (e)        $95,000

f) Salaries Expense

Account Details         Debit       Credit

Cash                       $45,000

h) Supplies (Food) Expense

Account Details         Debit       Credit

Supplies (Food)       $5,000

i) G

Account Details         Debit       Credit

Cash                       $17,000

I'm having a difficult time with my accounting workbook. I post the adjusting entries, but my balance sheet never equalizes. Can someone point me where i'm going wrong? 1. A supplier shipped $3,000 of ingredients on 12/29/17. Peyton receives an invoice for the goods, as well as a bill for freight for $175, all dated 12/29/17. Goods were shipped FOB supplier’s warehouse.
2. At 12/31/17, Peyton has $200 worth of merchandise on consignment at Bruno’s House of Bacon.
3. On 12/23/17, Peyton received a $1,000 deposit from Pet Globe for product to be shipped by Peyton in the second week of January.
4. On 12/03/2017, a mixer with cost of $2,000, accumulated depreciation $1,200, was destroyed by a forklift. As of 12/23/17, insurance company has agreed to pay $700 in January, 2018, for accidental destruction.
5. Note about later borrowing financials will show loan from parents repaid and use of bank financing.
PEYTON APPROVED
TRIAL BALANCE
As of December 31, 2017
Unadjusted trial balance Adjusting entries Adjusted trial balance
Dr Cr ref Dr Cr ref Dr Cr
Cash 67,520.04 67,520.04
Accounts Receivable 68,519.91 68,519.91
Other Receivable - Insurance Baking Supplies 15,506.70 15,506.70
Merchandise Inventory 1,238.07 1,238.07
Consignment Inventory Prepaid Rent 2,114.55 2,114.55
Prepaid Insurance 2,114.55 2,114.55
Misc. Supplies 170.49 170.49
Baking Equipment 14,000.00 14,000.00
Accumulated Depreciation 1,606.44 1,606.44
Customer Deposit - Accounts Payable 20,262.11 20,262.11
Wages Payable 3,383.28 3,383.28
Interest Payable 211.46 211.46
Notes Payable 5,000.00 5,000.00
Common Stock 20,000.00 20,000.00
Beginning Retained earnings 50,144.84 50,144.84
Dividends 105,000.00 105,000.00
Bakery Sales 327,322.55 327,322.55
Merchandise Sales 1,205.64 1,205.64
Cost of Goods Sold - Baked 105,834.29 105,834.29
Cost of Goods Sold - Merchandise 859.77 859.77
Rent Expense 24,549.19 24,549.19
Wages Expense 10,670.72 10,670.72
Misc. Supplies Expense 3,000.46 3,000.46
Business License Expense 2,045.77 2,045.77
Misc. Expense 1,363.84 1,363.84
Depreciation Expense 677.86 677.86
Insurance Expense 1,091.08 1,091.08
Advertising Expense 1,549.74 1,549.74
Interest Expense 818.31 818.31
Telephone Expense 490.98 490.98
Gain/Loss on disposal of equipment 429,136.32 429,136.32 - - 429,136.32 429,136.32

Answers

Answer:

PEYTON APPROVED

TRIAL BALANCE

As of December 31, 2017

                                        Unadjusted           Adjusting          Adjusted

                                      Trial balance             Entries         Trial balance

                                   Dr                Cr  ref   Dr         Cr  ref   Dr            Cr

Cash                          67,520.04           3   1,000              68,520.04

Accounts Receivable 68,519.91                                         68,519.91

Other Receivable -

Insurance Baking

 Supplies                  15,506.70                                         15,506.70

Merchandise

 Inventory                  1,238.07             1  3,175             1     4,413.07

Consignment

 Inventory                                            2   200             2      200

Prepaid Rent             2,114.55                                             2,114.55

Prepaid Insurance    2,114.55                                             2,114.55

Misc. Supplies             170.49                                               170.49

Baking Equipment 14,000.00              4  2,000          4 12,000.00

Accumulated Depreciation   1,606.44 4                      4                    406.44

Customer Deposit

- Accounts Payable            20,262.11                                           20,262.11

Wages Payable                     3,383.28                                            3,383.28

Interest Payable                        211.46                                                211.46

Notes Payable                     5,000.00                                           5,000.00

Common Stock                 20,000.00                                        20,000.00

Beginning Retained

 earnings                           50,144.84                                          50,144.84

Dividends                        105,000.00                                       105,000.00

Bakery Sales                   327,322.55                                      327,322.55

Merchandise Sales              1,205.64                                           1,205.64

Cost of Goods

Sold - Baked 105,834.29                                         105,834.29

Cost of Goods

Sold -

 Merchandise    859.77                                                 859.77

Rent Exp.       24,549.19                                            24,549.19

Wages Exp.   10,670.72                                             10,670.72

Misc. Supplies

 Expense       3,000.46                                              3,000.46

Business

License

Expense       2,045.77                                               2,045.77

Misc.

 Expense      1,363.84                                                1,363.84

Depreciation

 Expense        677.86                                                  677.86

Insurance

 Expense      1,091.08                                                1,091.08

Advertising

Expense     1,549.74                                                 1,549.74

Interest

 Expense       818.31                                                     818.31

Telephone

Expense      490.98                                                   490.98

Gain/Loss on

disposal of equipment 429,136.32 429,136.32 - - 429,136.32 429,136.32

Explanation:

a) Data and Calculations:

PEYTON APPROVED

TRIAL BALANCE

As of December 31, 2017

Unadjusted trial balance Adjusting entries Adjusted trial balance

Dr Cr ref Dr Cr ref Dr Cr

Cash 67,520.04 67,520.04

Accounts Receivable 68,519.91 68,519.91

Other Receivable - Insurance Baking Supplies 15,506.70 15,506.70

Merchandise Inventory 1,238.07 1,238.07

Consignment Inventory Prepaid Rent 2,114.55 2,114.55

Prepaid Insurance 2,114.55 2,114.55

Misc. Supplies 170.49 170.49

Baking Equipment 14,000.00 14,000.00

Accumulated Depreciation 1,606.44 1,606.44

Customer Deposit - Accounts Payable 20,262.11 20,262.11

Wages Payable 3,383.28 3,383.28

Interest Payable 211.46 211.46

Notes Payable 5,000.00 5,000.00

Common Stock 20,000.00 20,000.00

Beginning Retained earnings 50,144.84 50,144.84

Dividends 105,000.00 105,000.00

Bakery Sales 327,322.55 327,322.55

Merchandise Sales 1,205.64 1,205.64

Cost of Goods Sold - Baked 105,834.29 105,834.29

Cost of Goods Sold - Merchandise 859.77 859.77

Rent Expense 24,549.19 24,549.19

Wages Expense 10,670.72 10,670.72

Misc. Supplies Expense 3,000.46 3,000.46

Business License Expense 2,045.77 2,045.77

Misc. Expense 1,363.84 1,363.84

Depreciation Expense 677.86 677.86

Insurance Expense 1,091.08 1,091.08

Advertising Expense 1,549.74 1,549.74

Interest Expense 818.31 818.31

Telephone Expense 490.98 490.98

Gain/Loss on disposal of equipment 429,136.32 429,136.32 - - 429,136.32 429,136.32

b) The adjustments are made in the Adjusting entries column and referenced accordingly, while the effect is reflected in the adjusted trial balance column.

If a customer values good A at $15, and it costs the firm $10 to produce, current profit per unit is

Answers

Answer:

5

Explanation:

15 - 10 = 5
Other Questions
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