BUSINESS COLLEGE

On January 1, Year 1, Stratton Company borrowed $100,000 on a 10-year, 7% installment note payable. The terms of the note require Stratton to pay 10 equal payments of $14,238 each December 31 for 10 years. The required general journal entry to record the first payment on the note on December 31, Year 1 is:

Answers

Answer 1
Answer:

Answer:

Dr interest expense $7,000

Dr notes payable $7,238

Cr cash                                     $14,238    

Explanation:

The first task is to compute interest expense on the loan in year 1 which is shown below:

interest expense=$100,000*7%

interest expense=$7,000

Principal repayment=repayment-interest repayment

Principal repayment=$14,238-$7,000=$7,238

The double entries are to debit interest expense and notes payable with $7,000 and $7,238 respectively while cash is credited with $14,238 as an outflow of cash.

Related Questions

The standard costs and actual costs for direct materials for the manufacture of 2,300 actual units of product are Standard Costs Direct materials (per completed unit) 1,040 kilograms @$8.65 Actual Costs Direct materials 2,300 kilograms @ $8.05 Round your final answer to the nearest dollar. The amount of direct materials price variance is
The following income statement is provided for Vargas, Inc. Sales revenue (2,500 units × $60 per unit) $ 150,000 Cost of goods sold (variable; 2,500 units × $20 per unit) (50,000 ) Cost of goods sold (fixed) (8,000 ) Gross margin 92,000 Administrative salaries (42,000 ) Depreciation (10,000 ) Supplies (2,500 units × $4 per unit) (10,000 ) Net income $ 30,000 What is this company's magnitude of operating leverage?
Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 860,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 12%. The income tax rate was 40% and the dividend per share of common stock was $0.40 this year. The market value of the company’s common stock at the end of the year was $21. All of the company’s sales are on account.Weller CorporationComparative Balance Sheet(dollars in thousands)This Year Last YearAssets Current assets: Cash $ 976 $ 1,920 Accounts receivable, net 15,000 10,050 Inventory 10,000 8,440 Prepaid expenses 1,860 2,220 Total current assets 27,836 22,630 Property and equipment: Land 6,600 6,600 Buildings and equipment, net 19,800 19,600 Total property and equipment 26,400 26,200 Total assets $ 54,236 $ 48,830 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 10,100 $ 8,600 Accrued liabilities 720 1,000 Notes payable, short term 360 360 Total current liabilities 11,180 9,960 Long-term liabilities: Bonds payable 6,250 6,250 Total liabilities 17,430 16,210 Stockholders' equity: Common stock 860 860 Additional paid-in capital 4,500 4,500 Total paid-in capital 5,360 5,360 Retained earnings 31,446 27,260 Total stockholders' equity 36,806 32,620 Total liabilities and stockholders' equity $ 54,236 $ 48,830 Weller CorporationComparative Income Statement and Reconciliation(dollars in thousands)This Year Last YearSales $ 85,000 $ 80,000 Cost of goods sold 55,000 51,000 Gross margin 30,000 29,000 Selling and administrative expenses: Selling expenses 9,100 8,600 Administrative expenses 12,600 11,600 Total selling and administrative expenses 21,700 20,200 Net operating income 8,300 8,800 Interest expense 750 750 Net income before taxes 7,550 8,050 Income taxes 3,020 3,220 Net income 4,530 4,830 Dividends to common stockholders 344 645 Net income added to retained earnings 4,186 4,185 Beginning retained earnings 27,260 23,075 Ending retained earnings $ 31,446 $ 27,260 Required: Compute the following financial data for this year:1. Gross margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)2. Net profit margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)4. Return on equity. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).)
Suppose that your state raises its sales tax from 5 percent to 6 percent. The state revenue commissioner forecasts a 20 percent increase in sales tax revenue. Which of the following are plausible as a result of this increase in the sales tax. Is this plausible? Explain.
Investing in stocks is like gambling when:a. both have a short time horizon b. both involve risk c. both involve an initial outflow of cash d. both result in long-term loses.

Potential effects of departmental performance reports on employee behavior include all of the following except: Including indirect expenses can lead to a manager being more careful in using service department's costs. Using budgeted service department costs insures that operating departments are not held responsible for excessive service department costs. Including uncontrollable costs can serve to improve a manager's morale.

Answers

Potential effects of departmental performance reports on employee behavior except including uncontrollable costs served to improve manager's morale.

Explanation:

  • Performance management plays an important role to keep a proper record of all the works that are being performed in a company .
  • A proper performance management also shows an important effect on the behavior of the employees.
  • If the employees are boosted properly by the managers they will increase the productivity .
  • This will help the company to earn profits. Departmental performance keep record of all the expenses that are being done during the production process . It also help the manager to gain information and can adopt proper strategy to reduce expenses.

Crane uses the periodic inventory system. For the current month, the beginning inventory consisted of 7400 units that cost $11.00 each. During the month, the company made two purchases: 3100 units at $12.00 each and 12200 units at $12.50 each. Crane also sold 12700 units during the month. Using the average cost method, what is the amount of cost of goods sold for the month

Answers

Answer:

$151,673

Explanation:

Average cost method calculate the cost of the inventory on the average price basis. Cost of goods sold is the cost of the goods sold in the given period.

Description                   Units       Rate                   Value    

Beginning Inventory     7,400    $11.00                 $81,400

Purchases                     3,100     $12.00                $37,200

Purchases                     12,200   $12.50               $152,500

Total  Inventory            22,700   $11.94273128    $271,100

Sale                               12,700    $11.94273128    $151,673

Cost of Goods Sold = $271,100 x 12,700 / 22,700 = $151,673

Larry Bar opened a frame shop and completed these transactions: Larry started the shop by investing $41,100 cash and equipment valued at $19,100 in exchange for common stock. Purchased $180 of office supplies on credit. Paid $2,300 cash for the receptionist's salary. Sold a custom frame service and collected $5,600 cash on the sale. Completed framing services and billed the client $310. What was the balance of the cash account after these transactions were posted?

Answers

Answer:

$44,400

Explanation:

The computation of the balance of the cash account after posting of these transactions are shown below:

= Invested cash amount - cash paid for receptionist's salary + cash collection from sale of frame service

= $41,100 - $2,300 + $5,600

= $44,400

The other items do not involved any cash transactions. Therefore they are not relevant and thus they not considered in the computation part

A profit margin of 10% indicates that: Multiple Choice for every $1 in net income, the company generates $0.10 in net sales. for every $1 in net income, the company generates $0.90 in net sales. for every $1 in net sales, the company generates $0.10 in net income. for every $1 in net sales, the company generates $0.90 in net income.

Answers

Answer:

A profit margin of 10% indicates that:

for every $1 in net sales, the company generates $0.10 in net income.

Explanation:

Company B's profit margin measures the degree to which the company makes extra money after deducting the expenses from the sales revenue.  When expressed as a percentage, it indicates how many cents of profit has been generated for each dollar of sales.

Final answer:

A profit margin of 10% denotes that for every $1 in net sales, the company produces $0.10 in net income. It is calculated by dividing the net income by the net sales and multiplying the result by 100.

Explanation:

A profit margin of 10% indicates that for every $1 in net sales, the company generates $0.10 in net income. This is because the profit margin is calculated by dividing the net income by the net sales and then multiplying the result by 100 to get a percentage. In this case, a profit margin of 10% signifies that the company is able to generate 10 cents of profit from each dollar of sales.

Learn more about Profit Margin here:

brainly.com/question/34586882

#SPJ12

Wolf Company used $5,940 of indirect raw materials and $56,700 of direct raw materials during the period. The company incurred $37,800 of direct factory labor and $6,480 of indirect factory labor during the period. What amount will Wolf assign to Manufacturing Overhead

Answers

Answer:

Overhead= $12,420

Explanation:

Giving the following information:

Wolf Company used $5,940 of indirect raw materials and $6,480 of indirect factory labor during the period.

Factory overhead costs are the costs that can't be directly assigned to a product, service or job. This is why companies assigned overhead using manufacturing overhead rates.

In this case, the overhead is the sum if indirect material and indirect labor:

Overhead= 5,940 + 6,480= $12,420

True or False: In most cases, the only way publishers of media websites generate revenue is by charging advertisers to display ads on their sites.

Answers

Based on internet and website analysis, it is false that the only way publishers of media websites generate revenue is by charging advertisers to display ads on their sites.

How do websites generate revenue?

Websites generate revenue in many ways, which include the following:

  • Display Advertisement
  • Subscription and Membership
  • Sponsored Contents
  • Events
  • Affiliate Marketing
  • Digital Marketing, etc.

Hence, in this case, it is concluded that the correct answer is False.

Learn more about how websites generate revenue here: brainly.com/question/2833175

Final answer:

The statement is false. Publishers of media websites generate revenue not only through advertising but also from digital subscriptions, pay per view on premium content, and other diversified income streams.

Explanation:

The statement is false: the only way publishers of media websites generate revenue is not only by charging advertisers to display ads on their sites. While advertising is certainly a significant source of revenue, it is not the only one. Many publishers have diversified their income streams to include options such as digital subscriptions or pay per view for premium content.

For instance, let’s consider the decline in advertising revenues for print media, which dropped from $46 billion in 2012 to just $20.5 billion in 2020. In response to this shift, many publishers have enhanced their online presence as the number of people looking for news and entertainment online has increased. Even though advertising revenues have dipped, digital subscriptions allow news outlets to stay financially viable.

Digital paywalls where readers have to purchase online subscriptions to access specific content, are another way of generating income. Websites like Politico.com, Daily Kos, and even established newspapers like The New York Times have capitalized on this strategy. The availability and ease of online publication have enabled more niche media outlets to form and compete in the digital media market.

Learn more about Media Websites Revenue here:

brainly.com/question/34762442

#SPJ11
Other Questions
Required information Use the following information for the Problems below. Lansing Company’s 2017 income statement and selected balance sheet data (for current assets and current liabilities) at December 31, 2016 and 2017, follow. LANSING COMPANY Income Statement For Year Ended December 31, 2017 Sales revenue $ 118,200 Expenses Cost of goods sold 49,000 Depreciation expense 15,500 Salaries expense 25,000 Rent expense 9,700 Insurance expense 4,500 Interest expense 4,300 Utilities expense 3,500 Net income $ 6,700 LANSING COMPANY Selected Balance Sheet Accounts At December 31 2017 2016 Accounts receivable $ 6,300 $ 7,200 Inventory 2,680 1,890 Accounts payable 5,100 6,000 Salaries payable 1,020 770 Utilities payable 360 230 Prepaid insurance 330 420 Prepaid rent 360 250 Problem 16-1A Indirect: Computing cash flows from operations LO P2 Required: Prepare the cash flows from operating activities section only of the company’s 2017 statement of cash flows using the indirect method. (Amounts to be deducted should be indicated with a minus sign.) LANSING COMPANY Cash Flows from Operating Activities—Indirect Method For Year Ended December 31, 2017 Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operations:
Finishing Touches has two classes of stock authorized: 8%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2021, its first year of operations: January 2 Issues 100,000 shares of common stock for $35 per share. February 6 Issues 3,000 shares of 8% preferred stock for $11 per share. September 10 Purchases 11,000 shares of its own common stock for $40 per share. December 15 Resells 5,500 shares of treasury stock at $45 per share. In its first year of operations, Finishing Touches has net income of $160,000 and pays dividends at the end of the year of $94,500 ($1 per share) on all common shares outstanding and $2,400 on all preferred shares outstanding. Required: Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2021. (Amounts to be deducted should be indicated by a minus sign.)
Which of the following deposit requirements pertains to a monthly depositor who has accumulated employment taxes of $2,900 at the end of October
Shown below are selected data from the financial statements of the Supreme Company. (Dollar amounts are in millions, except for the per share data). Income statement data: $'000 Net sales $1,230 Cost of goods sold $520 Operating expenses $440 Net income $390 Balance sheet data: $'000 Average total equity $2,400 Average total assets $4,000 Supreme reported earnings per share for the year of $4 and paid cash dividends of $1 per share. At year-end, the Wall Street Journal listed Supreme's capital stock as trading at $88 per share. Required: Compute the following: a). Gross profit rate b). Supreme's operating income (in millions) c). Return on assets d). Return on equity e). Price-earning ratio