The beginning inventory for Waldo Co and data on purchases and sales for a three-month period are shown in Problem 7-1A

PR 7-2A LIFO Perpetual Inventory

The beginning inventory for Waldo Co and data on purchases and sales for a three-month period are shown in Problem 7-1A.

Instructions
1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 4, using the last-in, first-out method.
2. Determine the total sales, the total cost of merchandise sold, and the gross profit from sales for the period.
3. Determine the ending inventory cost.

Click here for the solution: The beginning inventory for Waldo Co and data on purchases and sales for a three-month period are shown in Problem 7-1A

Eric Johnson (using data from Problem 1.6) determines his costs to be as follows

Problems 1.7 Eric Johnson (using data from Problem 1.6) determines his costs to be as follows:

• Labor: $10 per hour
• Resin: $5 per pound
• Capital expense: 1% per month of investment
• Energy: $.50 per BTU.

Show the percent change in productivity for one month last year versus one month this year, on a multifactor basis with dollars as the common denominator.

Data from Problem 1.6
Last Year Now
Units produced 1,000 1,000
Labor (hours) 300 275
Resin (pounds) 50 45
Capital invested ($) 10,000 11,000
Energy (BTU) 3,000 2,850


Click here for the solution: Eric Johnson (using data from Problem 1.6) determines his costs to be as follows

Refer to Problem 4.2. Develop a forecast for years 2 through 12 using exponential smoothing with a= .4 and a forecast for year 1 of 6

Problem 4.3 Refer to Problem 4.2. Develop a forecast for years 2 through 12 using exponential smoothing with a= .4 and a forecast for year 1 of 6. Plot your new forecast on a graph with the actual data and the naive forecast. Based on a visual inspection, which forecast is better
Year 1 2 3 4 5 6 7 8 9 10 11
Demand 7 9 5 9 13 8 12 13 9 11 7


Click here for the solution: Refer to Problem 4.2. Develop a forecast for years 2 through 12 using exponential smoothing with a= .4 and a forecast for year 1 of 6

The April transactions of Wise Company are described in Problem 7-1A

ACC 225 Week 7

Problem 7-3A

The April transactions of Wise Company are described in Problem 7-1A.

Required
1. Prepare a general journal, a purchases journal like that in Exhibit 7.9, and a cash disbursements journal like that in Exhibit 7.11. Number all journal pages as page 3. Review the April transactions of Wise Company and enter those transactions that should be journalized in the general journal, the purchases journal, or the cash disbursements journal. Ignore any transactions that should be journalized in a sales journal or cash receipts journal.
2. Open the following general ledger accounts: Cash, Inventory, Office Supplies, Store Supplies, Store Equipment, Accounts Payable, Long-Term Notes Payable, Sales Salaries Expense, and Advertising Expense. Enter the March 31 balances of Cash ($85,000), Inventory ($125,000), and Long-Term Notes Payable ($210,000). Also open accounts payable subsidiary ledger accounts for Ned’s Supply, Negi Company, Price Company, and Madison, Inc.
3. Verify that amounts that should be posted as individual amounts from the journals have been
posted. (Such items are immediately posted.) Foot and crossfoot the journals and make the monthend postings.
4. Prepare a trial balance of the general ledger and a schedule of accounts payable.


Click here for the solution: The April transactions of Wise Company are described in Problem 7-1A

ACC 225 Week 9 Final Project: Comprehensive Problem-Perpetual: Denney Enterprises

ACC 225 Week 9
Use the spreadsheet in Course Materials named Final Project to complete the problems. Use the tabs labeled P07D and Given P07D.

Inv. No. Check
Date Description Name or Date No. Terms Amount
Dec. 16 Merchandise sold (cost $4,600) Hanna Seppa 916 2/10, n/30 $7,700
17 Received credit memo on returned merch. Funk Company Dec. 15 1,040
17 Purchased office supplies KK's Supply Company Dec. 16 n/10 EOM 615
18 Received credit memo on returned merch. KK's Supply Company Dec. 17 40
20 Issued credit memo on returned merch. Bo Brown Dec. 15 500
21 Purchased store equipment KK's Supply Company Dec. 21 n/10 EOM 6,700
22 Received payment less discount Hanna Seppa Dec. 12
23 Paid invoice less discount Crossland Company Dec. 15 623
24 Sold merchandise on credit (cost $600) Shilo Jones 917 1,200
24 Paid inv. less discount and return Funk Company Dec. 15 624
25 Received payment less discount and return Bo Brown Dec. 15
26 Purchased merchandise and invoice Crossland Company Dec. 25 2/10, n/60 8,100
29 Sold office supplies for cash at cost 50
30 Issued check to owner for personal use Cadence Denney 625 2,500
31 Check issued for sales salaries Jamie Inman 626 2,020
31 Issued check for electric bill Access Electric Company 627 710
31 Cash sales for last half of month (cost $11,200) 29,600

Check figure: Trial balance totals $219,408


Click here for the solution: ACC 225 Week 9 Final Project: Comprehensive Problem-Perpetual: Denney Enterprises

For each of the following problems, provide an audit procedure that would have identified the problem

Problem 10-28 For each of the following problems, provide an audit procedure that would have identified the problem.
(a) The allowance for doubtful accounts estimated by management is too small.
(b) Cash received in payment of an account receivable is deposited in the bank in the current period but is not posted to the accounts receivable record, trial balance, or general ledger until the subsequent period.
(c) For a month, sales are transacted using an outdated price list with amounts that are too low. The transactions are recorded accurately based on the price list used. Management is not aware the problem occurred.
(d) Cash for the exact amounts of sales are regularly pocketed by employees and not recorded on the sales terminal. Customers do not ask for receipts.
(e) Management records false sales close to year end and posts them as Accounts Receivable.
(f) Sales on account for services that take place in the first two days of the subsequent year are posted in the current year.


Click here for the solution: For each of the following problems, provide an audit procedure that would have identified the problem

Refer to the information given in the preceding problem for Great Outdoze, Inc

8-30 Refer to the information given in the preceding problem for Great Outdoze, Inc. Assume that direct material is the only unit-level manufacturing cost. The company has committed its spending for direct labor and overhead (variable and fixed).

Required:
1. Calculate the product cost per sleeping bag under throughput costing.
2. Prepare an income statement for the year 20x4 using throughput costing.
3. Give an argument for and against throughput costing.

Check: 2. Throughput costing, gross margin: $1,980,000


Click here for the solution: Refer to the information given in the preceding problem for Great Outdoze, Inc

Using the information from Problem 47, determine the basis of the property contributed in the hands of the corporation in each instance

48. Using the information from Problem 47, determine the basis of the property contributed in the hands of the corporation in each instance. Assume that the 80% rule is met in all cases.


Click here for the solution: Using the information from Problem 47, determine the basis of the property contributed in the hands of the corporation in each instance

Challenge Problem: Consider a market with only the following three risky assets

Challenge Problem: Consider a market with only the following three risky assets:

Expected Return % per month Risk % Covariance with market
Asset 1 2.03 2 1.12
Asset 2 1.79 1 0.90
Asset 3 1.49 1 0.62
Market Portfolio 0.92

a) Consider the market portfolio comprised of 4% invested in Asset 1, 76% invested in Asset 2, and 20% invested in Asset 3. What is the expected return of this portfolio?
b) What are the betas of the three risky assets?
c) Suppose the riskless rate of interest is 0.8% (8/10ths of one percent per month). Are these three securities priced correctly?
d) What is the beta of the market portfolio calculated as a weighted average of the betas of its components?


Click here for the solution: Challenge Problem: Consider a market with only the following three risky assets

Use the financial statements for Bernard Company from Problem 9-22 to calculate the following for 2012 and 2011

Chapter 9 Problem. Complete the following problem from Chapter 9 and submit to your instructor. Problem: 9-23. This problem will be graded for accuracy.

Use the financial statements for Bernard Company from Problem 9-22 to calculate the following for 2012 and 2011.

a. Working capital
b. Current Ratio
c. Quick Ratio
d. Accounts receivable turnover (beginning receivables at 01/01/2011, was $47,000)
e. Average number of days to collect accounts receivable
f. Inventory turnover (beginning inventory at 01/01/2011, was $140,000)
g. Average number of days to sell inventory
h. Debt to asset ratio
i. Debt to equity ratio
j. Times interest earned
k. Plant assets to long-term debt
l. Net margin
m. Asset turnover
n. Return on investment (ROI)
o. Return on Equity (ROE)
p. Earnings per share
q. Book value per share of common stock
r. Price-earnings ratio (market price per share, 2011, $11.75; 2012, $12.50)
s. Dividend yield on common stock

Click here for the solution: Use the financial statements for Bernard Company from Problem 9-22 to calculate the following for 2012 and 2011

Use the assets and partners’ bases from Problem 28. Assume the partnership distributes all its assets in a liquidating distribution

Use the assets and partners’ bases from Problem 28. Assume the partnership distributes all its assets in a liquidating distribution. In deciding the allocation of assets, what issues should the partnership consider to minimize each partner’s taxable gains?

Click here for the solution: Use the assets and partners’ bases from Problem 28. Assume the partnership distributes all its assets in a liquidating distribution

Given Robinson’s 2010 and 2011 financial information presented in problem 2 and 4

Given Robinson’s 2010 and 2011 financial information presented in problem 2 and 4,
a. Compute it’s operating and cash conversion cycle in each year.
b. What was Robinson’s net investment in working capital each year?

Click here for the solution: Given Robinson’s 2010 and 2011 financial information presented in problem 2 and 4

Puckett Co. has office furniture that cost $75,000 and that has been depreciated $50,000

Problem 10-6A (P10-6A) Puckett Co. has office furniture that cost $75,000 and that has been depreciated $50,000. Record the disposal under the following assumptions
(a) it was scrapped as having no value
(b) it was sold for 21,000
(c) it was sold for $31,000

Click here for the solution: Puckett Co. has office furniture that cost $75,000 and that has been depreciated $50,000

Ortega Industries Inc. manufactures in separate processes furniture for homes

Problem 3-2A (P3-2A) Ortega Industries Inc. manufactures in separate processes furniture for homes. In each process, materials are entered at the beginning, and conversion costs are incurred uniformly. Production and cost data for the first process in making two products in two different manufacturing plants are as follows.

Cutting Department
Plant 1 Plant 2
Production Data—July T12-Tables C10-Chairs
Work in process units, July 1 –0– –0–
Units started into production 20,000 16,000
Work in process units, July 31 3,000 500
Work in process percent complete 60 80
Cost Data—July
Work in process, July 1 $ –0– $ –0–
Materials 380,000 288,000
Labor 234,400 125,900
Overhead 104,000 96,700
Total $718,400 $510,600

Hint:
Complete four steps necessary to prepare a production cost report.

Instructions
(a) For each plant:

1. Compute the physical units of production.
2. Compute equivalent units of production for materials and for conversion costs.
3. Determine the unit costs of production.
4. Show the assignment of costs to units transferred out and in process.

Check:
(a) (1) T12: Transferred out 17,000 units; WIP 3,000 units
(2) T12: Materials 20,000 e.u.; CC 18,800 e.u.
(3) T12: Materials $19; CC $18
(4) T12: Transferred out $629,000; WIP $89,400

Click here for the solution: Ortega Industries Inc. manufactures in separate processes furniture for homes

(Comprehensive Accounting Cycle Problem) The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted

Problem 5-26 Comprehensive Accounting Cycle Problem (Uses Percent of Revenue Allowance Method)

The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted.

AND SO ON

Required
a. Organize the transaction data in accounts under an accounting equation.
b. Prepare an income statement, a statement of changes in stockholders' equity, a balance sheet, and a statement of cash flows for 2011.

Check:
Net Income: $236,710
Total Assets: 1,142,950

Click here for the solution: (Comprehensive Accounting Cycle Problem) The following trial balance was prepared for Gifts, Etc., Inc., on December 31, 2010, after the closing entries were posted

Quentin Giordano owns a small retail ice cream parlor

Problem 16-17 Using the Payback Period and Unadjusted Rate of Return to Evaluate Alternative Investment Opportunities

Quentin Giordano owns a small retail ice cream parlor. He is considering expanding the business and has identifies two attractive alternatives. One involves purchasing a machine that would enable him to serve frozen yogurt to customers. The machine would cost $4,050 and has an expected useful life of three years with no salvage value. Additional annual cash revenues and cash operating expenses associated with selling yogurt are expected to be $2,970 and $450, respectively.
Alternatively, he could purchase for $5,040 the equipment necessary to serve cappuccinos. That equipment has an expected useful life of four years and no salvage value. Additional annual cash revenue and cash operating expenses associated with selling cappuccinos are expected to be $4,140 and $1,215, respectively.
Income before taxes earned by the ice cream parlor is taxed at an effective rate of 20 percent.

A. Determine the payback period and unadjusted rate of return (use average investment.) for each alternative.

B. Indicate which investment alternative you would recommend. Explain your choice.

Check:
a. Payback Period of the Yogurt Investment: 1.77 Years
Unadjusted Rate of Return of the Cappuccino Investment: 52.86%

Click here for the solution: Quentin Giordano owns a small retail ice cream parlor

ACC 421 Week 5 (Time Value Concepts Applied to Solve Business Problems) Answer the following questions related to Derek Lee Inc

ACC 421 Week Five (Week 5)

Problem 6-7 (P6-7) (Time Value Concepts Applied to Solve Business Problems) Answer the following questions related to Derek Lee Inc.

(a) Derek Lee Inc. has $572,000 to invest. The company is trying to decide between two alternative uses of the funds. One alternative provides $80,000 at the end of each year for 12 years, and the other is to receive a single lump sum payment of $1,900,000 at the end of the 12 years. Which alternative should Lee select? Assume the interest rate is constant over the entire investment.

(b) Derek Lee Inc. has completed the purchase of new Dell computers. The fair market value of the equipment is $824,150. The purchase agreement specifies an immediate down payment of $200,000 and semiannual payments of $76,952 beginning at the end of 6 months for 5 years. What is the interest rate, to the nearest percent, used in discounting this purchase transaction?

(c) Derek Lee Inc. loans money to John Kruk Corporation in the amount of $600,000. Lee accepts an 8% note due in 7 years with interest payable semiannually. After 2 years (and receipt of interest for 2 years), Lee needs money and therefore sells the note to Chicago National Bank, which demands interest on the note of 10% compounded semiannually. What is the amount Lee will receive on the sale of the note?

(d) Derek Lee Inc. wishes to accumulate $1,300,000 by December 31, 2017, to retire bonds outstanding. The company deposits $300,000 on December 31, 2007, which will earn interest at 10% compounded quarterly, to help in the retirement of this debt. In addition, the company wants to know how much should be deposited at the end of each quarter for 10 years to ensure that $1,300,000 is available at the end of 2017. (The quarterly deposits will also earn at a rate of 10%, compounded quarterly.) (Round to even dollars.)

Click here for the solution: ACC 421 Week 5 (Time Value Concepts Applied to Solve Business Problems) Answer the following questions related to Derek Lee Inc

Problem 3-1A (P3-1A) Kasten Company manufactures bowling balls through two processes: Molding and Packaging

Problem 3-1A (P3-1A) Kasten Company manufactures bowling balls through two processes: Molding and Packaging. In the Molding Department, the urethane, rubber, plastics, and other materials are molded into bowling balls. In the Packaging Department, the balls are placed in cartons and sent to the finished goods warehouse. All materials are entered at the beginning of each process. Labor and manufacturing overhead are incurred uniformly throughout each process. Production and cost data for the Molding Department during June 2008 are presented below.

Production Data June
Beginning work in process units –0–
Units started into production 20,000
Ending work in process units 2,000
Percent complete—ending inventory 60%
Cost Data
Materials $198,000
Labor 50,400
Overhead 112,800
Total $361,200

Hint:
Complete four steps necessary to prepare a production cost report.

Instructions
(a) Prepare a schedule showing physical units of production.
(b) Determine the equivalent units of production for materials and conversion costs.
(c) Compute the unit costs of production.
(d) Determine the costs to be assigned to the units transferred and in process for June.
(e) Prepare a production cost report for the Molding Department for the month of June.

Check:
(c) Materials $9.90; CC $8.50
(d) Transferred out $331,200; WIP $30,000
 

Click here for the solution: Problem 3-1A (P3-1A) Kasten Company manufactures bowling balls through two processes: Molding and Packaging

Problem 3-3A (P3-3A) Fiedel Company manufactures its product, Vitadrink, through two manufacturing processes: Mixing and Packaging

Problem 3-3A (P3-3A) Fiedel Company manufactures its product, Vitadrink, through two manufacturing processes: Mixing and Packaging. All materials are entered at the beginning of each process. On October 1, 2008, inventories consisted of Raw Materials $26,000, Work in Process—Mixing $0, Work in Process—Packaging $250,000, and Finished Goods $289,000. The beginning inventory for Packaging consisted of 10,000 units that were 50% complete as to conversion costs and fully complete as to materials. During October, 50,000 units were started into production in the Mixing Department and the following transactions were completed.

1. Purchased $300,000 of raw materials on account.
2. Issued raw materials for production: Mixing $210,000 and Packaging $45,000.
3. Incurred labor costs of $248,900.
4. Used factory labor: Mixing $182,500 and Packaging $66,400.
5. Incurred $790,000 of manufacturing overhead on account.
6. Applied manufacturing overhead on the basis of $22 per machine hour. Machine hours were 28,000 in Mixing and 6,000 in Packaging.
7. Transferred 45,000 units from Mixing to Packaging at a cost of $979,000.
8. Transferred 53,000 units from Packaging to Finished Goods at a cost of $1,315,000.
9. Sold goods costing $1,604,000 for $2,500,000 on account.

Hint:
Journalize transactions.

Instructions
Journalize the October transactions.

Click here for the solution: Problem 3-3A (P3-3A) Fiedel Company manufactures its product, Vitadrink, through two manufacturing processes: Mixing and Packaging