BUSINESS COLLEGE

The December 31, 2018, balance sheet of Whelan, Inc., showed $136,000 in the common stock account and $2,610,000 in the additional paid-in surplus account. The December 31, 2019, balance sheet showed $146,000 and $2,910,000 in the same two accounts, respectively. The company paid out $141,000 in cash dividends during 2019.Required:

What was the cash flow to stockholders for the year?

Answers

Answer 1

Answer:

Answer:

$169,000 negative

Explanation:

Equity = Common stock + Additional paid in surplus

Total equity at beginning= Common stock + Additional paid in surplus

=136,000+2,610,000=$2,746,000

Total equity at end= Common stock + Additional paid in surplus

=146,000+2,910,00)=$3,056,000

Hence new equity = Total equity at End - Total equity at beginning

3,056,000-2,746,000=$310,000

Cash flow to stockholders = Dividends paid - New equity

= 141,000-310,000

= -169,000

=$169,000 negative

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On January 1, 2021 M.T. Glass purchased the following investments: 1. 7,500 shares (representing 15%) of ZZ Company stock for $98,000 2. 25,000 shares (representing 40%) of AA Company stock for $440,000 M.T. Glass recorded the sale of some of its investments in 2022 as follows: 1. September 1 sold 5,000 shares of the ZZ Company stock for $76,000 2. December 31 sold 4,000 shares of the AA Company stock for $120,000 AA Company and ZZ Company reported the following information for the years 2021 and 2022: AA Company ZZ Company Net income in 2021 $260,000 $200,000 Dividends paid to M.T. Glass in 2021 $24,000 $15,000 Market value at Dec 31, 2021 $27 per share $22 per share Net income in 2022 $160,000 $225,000 Dividends paid to M.T. Glass in 2022 $41,000 $5,000 Market value at Dec 31, 2022 $24 per share $28 per share Calculate the amount of the realized gain reported in M.T. Glass' 2022 income statement resulting from the sale of the AA Company stock.

Answers

Answer:

$15000

Explanation:

If the investor the outstanding shares of the other company which is less than 20% then we can report the unrealized gains or losses in the income statement. The unrealized gain can be calculated as follows:

check the attachment below

The Kilp Sisters Trust is required to distribute $60,000 annually equally to its two income beneficiaries, Clare and Renee. If trust income is not sufficient to pay these amounts, the trustee can invade corpus to the extent necessary. During the current year, the trust generates only taxable interest income and records DNI of $160,000; the trustee distributes $30,000 to Clare and $150,000 to Renee. a. How much of the $150,000 distributed to Renee is included in her gross income? $.
b. How much of the $30,000 distributed to Clare is included in her gross income? $ is included in her gross income.
c. The distributions which are composed of trust accounting income that is required to be distributed currently come under .

Answers

Answer:

Results for Renee are as follows:

After the first tier distributions ($60000/2 = $30000 to each income beneficiaries) are accounted for, $100000 DNI remains to be assigned to the beneficiaries on the second tier ($160000 DNI - $60000 DNI used for first tier distribution).

Amount received DNI received = Gross income,

portfolio income

First tier $30,000.00 $30,000.00

Second tier $1,20,000.00 $ 1,00,000.00

Total $1,50,000.00 $ 1,30,000.00

Results for Clare are as follows:

Amount received DNI received = Gross income,

portfolio income

First tier $30,000.00 $ 30,000.00

Second tier $ - $ -

Total $30,000.00 $ 30,000.00

The distributions which are composed of trust accounting income that is required to be distributed currently come under First Tier Distribution.

QS 3-7 Adjusting prepaid (deferred) expenses LO P1 For each separate case, record the necessary adjusting entry. On July 1, Lopez Company paid $1,200 for six months of insurance coverage. No adjustments have been made to the Prepaid Insurance account, and it is now December 31. Zim Company has a Supplies account balance of $5,000 at the beginning of the year. During the year, it purchased $2,000 of supplies. As of December 31, a physical count of supplies shows $800 of supplies available. Prepare the year-end adjusting entries to reflect expiration of the insurance and correctly report the balance of the Supplies account and the Supplies Expense account as of December 31.

Answers

Answer:

S/n General Journal Debit Credit

a Insurance expense $1,200

Prepaid Insurance $1,200

(To record insurance expired)

b Supplies expense $6,200

Supplies $6,200

($5,000 + $2,000 - $800)

(To record supplies used)

Final answer:

Lopez company should adjust their prepaid insurance and Zim company should adjust their supplies account due to their use during the year. Both adjustments will be debits to relevant expense accounts & credits to Prepaid Insurance for Lopez, and Supplies for Zim.

Explanation:

The two adjustments that need to be made are for the prepaid insurance and the supplies. To compute the adjustment for the prepaid insurance, we would divide the total insurance payment by the number of months covered to find the monthly cost. For Lopez Company, six months of insurance is valued at $1,200, therefore the monthly cost is $200. From July 1 to December 31, six months have passed, so $1,200 of insurance has been used up. As a result, we need to debit the Insurance Expense account by $1,200 and credit Prepaid Insurance by $1,200.

Regarding Zim Company, the beginning balance in the Supplies account was $5,000, and it purchased $2,000 more throughout the year - that sum up to $7,000 of total supplies. At the end of the year, they still had $800 left, so they used $6,200 of supplies during the year. The adjustment will be a debit to Supplies Expense by $6,200 and a credit to Supplies by $6,200, reflecting the fact that those supplies are no longer available for use.

Learn more about Adjusting Entries here:

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A produce distributor uses 773 packing crates a month, which it purchases at a cost of $11 each. The manager has assigned an annual carrying cost of 33 percent of the purchase price per crate. Ordering costs are $28. Currently the manager orders once a month. How much could the firm save annually in ordering and carrying costs by using the EOQ?

Answers

$\sqrt(2*773*28)/(33)$ Answer:

Explanation:

Using the EOQ Formula = EOQ $\sqrt(2*D*O)/(H)$

D = Demand = 773

O = Ordering Cost =28

H = holding Cost = 11*33% =3.63

So we have :

EOQ= $\sqrt(2*D*O)/(H)$

EOQ= $\sqrt(2*773*28)/(3.63)$

EOQ= $\sqrt(43288\n)/(3.63)$

EOQ= $√(11925.06887)$

EOQ= 109.20196

Previous per unit order cost = 28/773 =0.03622

No of Orders = D/o

No of Orders = 773/109.20196 =7.0786

Cost per order =109.20196*0.03622 =3.9555

Total order cost= 7.0786*3.9555=27.9998

At EOQ holding Cost is equal to Order Cost

New Order cost =27.9998

Holding Cost = 27.9998

New cost As per EOQ = 56

Previous (33+28) = 61

Net Saving = 5

McCoy Brothers manufactures and sells two products, A and Z in the ratio of 5:2. Product A sells for $75; Z sells for $95. Variable costs for product A are $35; for Z $40. Fixed costs are $418,500. Compute the contribution margin per composite unit

Answers

Answer:

Weighted average contribution margin= $44.29

Explanation:

Giving the following information:

Sales proportion:

Product A= 5/7= 0.714

Product Z= 2/7= 0.286

Product A sells for $75; Z sells for $95.

Variable costs for product A are $35; for Z $40.

To determine the contribution margin per composite unit, we need to use the following formula:

Weighted average contribution margin= (weighted average selling price - weighted average unitary variable cost)

Weighted average contribution margin= (0.714*75 + 0.286*95) - (0.714*35 + 0.286*40)

Weighted average contribution margin= 80.72 - 36.43

Weighted average contribution margin= $44.29

The following are budgeted data:Sales (units ) Production (units)April 15,000 18,000May 20,000 19,000June 18,000 16,000Two pounds of material is required for each finished unit. The inventory of materials at the end of each month should equal 20% of the following month's production needs.Purchases of raw materials for May should be:a.36,800 poundsb.39,200 poundsc.52,000 poundsd.38,000 pounds

Answers

Answer:

Total= 36,800 pounds

Explanation:

Giving the following information:

Sales (units ) - Production (units):

May: 20,000 - 19,000

June: 18,000 - 16,000

Two pounds of material is required for each finished unit. The inventory of materials at the end of each month should equal 20% of the following month's production needs.

Purchases for May= production for the month + desired ending inventory - beginning inventory

Production= 19,000*2 pounds= 38,000 pounds

Desired ending inventory= (16,000*2)*0.2= 6,400 pounds

Beginning inventory= (38,000*0.2)= (7,600)

Total= 36,800 pounds

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