Answer:
D. $ 3,039 million
Explanation:
Net Operating Assets = Operating Assets - Operating Liabilities
Net Operating Assets = $6,566 million - 3,527 million
Net Operating Assets = $3,039 million
Answer:
$33,120,000
Explanation:
Calculation for What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project
Using this formula
Proper Cash Flow Amount = (Expected Cost of Selling + Cost of Building Manufacturing Plant + Cost of Grading)
Let plug in the formula
Proper Cash Flow Amount = ($10,500,000 + $21,700,000 + $920,000)
Proper Cash Flow Amount = $33,120,000
Therefore the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project will be $33,120,000
(a) $30
(b) $40
(c) $50
2. Compare these proceeds to what you would realize if you simply continued to hold the shares.
Answer:
1. What will be the value of your portfolio in January (net of the proceeds from the options) if the stock price ends up at:
(a) $30 ⇒ $170,000
(b) $40 ⇒ $195,000
(c) $50 ⇒ $220,000
call strike price $45
call premium received $2
put strike price $35
put premium paid $3
you pay $2 - $3 = -$1
stock price
$30 $40 $50
stock value $30 $40 $50
put value $5 - -
call value - - -$5
premium paid -$1 -$1 -$1
net stock value $34 $39 $44
total # of stocks 5,000 5,000 5,000
portfolio's value $170,000 $195,000 $220,000
2. Compare these proceeds to what you would realize if you simply continued to hold the shares.
if you hold the stocks:
(a) $30 ⇒ $150,000 - $170,000 = -$20,000 (you gain by using a collar)
(b) $40 ⇒ $200,000 - $195,000 = $5,000 (you lose by using a collar)
(c) $50 ⇒ $250,000 - $220,000 = $30,000 (you lose by using a collar)
2. Incurred manufacturing overhead costs as follows: indirect materials $17,000 (including broom polish and specially crafted scissors to trim stray twigs), indirect labor $20,000 (Hansel and Gretel clean the shop and run errands for the elves), depreciation expense on equipment $12,000 (Broomhilda has multiple molding stations for each broom she creates), and various other manufacturing overhead costs on account $16,000.
3. Assigned direct materials and direct labor to jobs as follows:
Job no. Direct Materials Direct Labor
50 10,000 5,000
51 39,000 25,000
52 30,000 20,000
Required:
a. Calculate the predetermined overhead rate for September, assuming Broomhilda estimates total manufacturing overhead costs of $840,000 and direct labor costs of $700,000 for September.
b. Open job cost sheets for Jobs 50, 51, and 52. Enter the September 1 balances on the job cost sheet for Job 50.
c. Prepare the journal entries to record the purchase of raw materials, and the manufacturing overhead costs incurred during the month of March.
d. Prepare the summary journal entries to record the assignment of direct materials, direct labor, and manufacturing overhead costs to production. In assigning overhead costs, use the overhead rate calculated in (1). Post all costs to the job cost sheets as necessary.
e. Total the job cost sheets for any job(s) completed during the month. Prepare the journal entry (or entries) to record the completion of any job(s) during the month.
f. Prepare the journal entry (or entries) to record the sale of any job(s) during the month.
g. What is the balance in the Finished Goods Inventory account at the end of the month? What job(s) does this balance consist of? 8. What is the amount of over- or underapplied overhead? Prepare the journal entry to close this to Cost of Goods Sold
Answer:
Broomhilda
a. Predetermined overhead rate = overhead costs/direct labor costs
= $840,000/$700,000
= $1.20 per direct labor cost
b. Job Cost Sheets for Job 50 Job 51 Job 52
Beginning balances:
Direct materials $20,000
Direct labor $12,000
Manufacturing overhead $16,000
c. Journal Entries for the purchase of raw materials and manufacturing overhead costs:
Debit Raw materials $90,000
Credit Accounts Payable $90,000
To record the purchase of raw materials on account.
Debit Manufacturing overhead $65,000
Credit Raw materials $17,000
Credit Wages $20,000
Credit Depreciation expense $12,000
To record the manufacturing overhead incurred.
d. Debit Job 50 $21,000
Credit Raw materials $10,000
Credit Direct labor $5,000
Credit Manufacturing overhead $6,000
To record the assignment of direct materials, direct labor, and manufacturing overhead costs to Job 50.
Debit Job 51 $94,000
Credit Raw materials $39,000
Credit Direct labor $25,000
Credit Manufacturing overhead $30,000
To record the assignment of direct materials, direct labor, and manufacturing overhead costs to Job 51
Debit Job 52 $74,000
Credit Raw materials $30,000
Credit Direct labor $20,000
Credit Manufacturing overhead $24,000
To record the assignment of direct materials, direct labor, and manufacturing overhead costs to Job 52
e. Job Cost Sheets for Job 50 Job 51 Job 52
Beginning balances:
Direct materials $20,000
Direct labor $12,000
Manufacturing overhead $16,000
Direct materials $10,000 $39,000 $30,000
Direct labor $5,000 $25,000 $20,000
Manufacturing overhead $6,000 $30,000 $24,000
Total $69,000 $94,000
f. Debit Accounts Receivable $280,000
Credit Sales Revenue $280,000
To record the sale of goods (Jobs 49 and 50 for $122,000 and $158,000, respectively).
Debit Cost of Goods Sold $159,000
Credit Job 49 $90,000
Credit Job 50 $69,000
To record the cost of goods sold for Jobs 49 and 50.
g. Finished Goods Inventory balance = $94,000
This balance consists of Raw materials $39,000, Direct labor $25,000, and Manufacturing overhead $30,000 for Job 51.
h. The amount of over-or underapplied overhead:
Overhead incurred = $65,000
Overhead applied = $60,000
Underapplied = $5,000
Debit Cost of Goods Sold $5,000
Credit Manufacturing overhead $5,000
To close the underapplied overhead to the cost of goods sold.
Explanation:
Jobs 50 costs prior to September:
direct materials $20,000,
direct labor $12,000, and
manufacturing overhead $16,000
Total costs so far = $$48,000
Job 49 completed at a cost of $90,000
Beginning balance of Raw Materials Inventory = $15,000
Started Jobs 51 and 52, completed Jobs 50 and 51
Sold Jobs 49 and 50 on account for $122,000 and $158,000, respectively.
Additional events:
Raw materials purchased on account = $90,000
Manufacturing overhead incurred:
indirect materials $17,000
indirect labor $20,000
depreciation expense on equipment $12,000
Various manufacturing overhead = $16,000
Total = $65,000
Assignment of direct materials and direct labor to jobs:
Job no. Direct Materials Direct Labor Manufacturing overhead
50 10,000 5,000 $6,000
51 39,000 25,000 $30,000
52 30,000 20,000 $24,000
Estimated total manufacturing overhead costs = $840,000
Estimated direct labor costs = $700,000
Predetermined overhead rate = overhead costs/direct labor costs
= $840,000/$700,000
= $1.20 per direct labor cost
Answer:
Option (b) is correct.
Explanation:
Given that,
Net sales = $4,885,340
Cost of goods sold = (2,942,353 )
Selling expenses = (884,685 )
Operating income = $1,058,302
Interest expense = $(55,240 )
Earnings before income taxes = $1,003,062
Income tax expense = $(401,225 )
Net income = $ 601,837
EBIT = Net income + Income tax expense + Interest expense
= $1,003,062 + $401,225 + $55,240
= $1,058,302
Times interest earned ratio in 2017:
= EBIT ÷ Interest expense
= $1,058,302 ÷ $55,240
= 19.1582 or 19.16
Answer:
E = 74.27%
Preferred = 8.10%
Debt = 17.63%
Explanation:
We are asked for the structure weight.
Equity 55,000 shares x 31 = 1,705,000
Preferred stock 3,000 x 62 = 186,000
Debt 400,000 x 101.2/100 = 404,800
Value of the Firm 2,295,800
Now we divide each component by the value of the firm.
Equity weight 1,705,000/2,295,800 = 0,742660 = 74.27%
Preferred stock 186,000 / 2,295,800 = 0,081017 = 8.10%
Debt 404,800/ 2,295,800 = 0,17632197 = 17.63%
Answer:
There is a change of $27,500 (decrease)
Explanation:
Cash realizable value is the amount of money that the company expects to receive from their accounts receivable after deducting all uncollectible accounts.
First, we must compute the change in gross accounts receivable from the transactions happened during the year.
Sales on account less collections less write-offs = change in Gross accounts receivable.
$866,000 - ($522,000 + $42,500) = $301,500 (increase in gross accounts receivable)
Finally, we can now compute the change in cash realization value by deducting uncollectible accounts to gross accounts receivable.
$301,500 - $329,000 = ($27,500)