BUSINESS COLLEGE

At the end of 2020, Aramis Company has accounts receivable of $800,000 and an allowance for doubtful accounts of $40,000. On January 16, 2021, Aramis Company determined that its receivable from Ramirez Company of $6,000 will not be collected, and management authorized its write-off.a) Prepare the journal entry for Aramis Company to write off the Ramirez receivableb) What is the net realizable value of Aramis Company's accounts receivable before the write off of the Ramirez receivable?

c) What is the net realizable value of Aramis Company's accounts receivable after the write off of the Ramirez receivable?

Answers

Answer 1

Answer:

Journal entry for write off the Ramirez receivable

Debit Allowance for doubtful Accounts $6,000

Credit Accounts receivables $6,000

Net realizable Receivables (beginning balance)

= accounts receivable of $800,000 Less allowance for doubtful accounts of $40,000

Net realizable receivable = $760,000

Net realizable Receivables (closing balance)

= accounts receivable of $800,000

Less adjustment for write off $6,000

Closing Accounts receivables balance $794,000

Less

Opening allowance for doubtful accounts of $40,000

Less debt write off $6,000

Closing allowance for doubtful account = $34,000

Closing Net realizable receivable = $760,000

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Answers

Answer:

(a)

Preferred stock Dividend = ( 10,000 x 100 ) x 8% = $80,000

Cumulative Dividend

Date Dividend for the year Balance

December 31, 2015 $80,0000 $80,000

December 31, 2016 $80,0000 $160,000

December 31, 2017 $80,0000 $240,000

Payable of $240,000 Dividend will be reported on the Balance Sheet.

(b) Dr. Cr.

Preferred Stock (4,000 x $100) $400,000

Common stock ((4000 x 7) x $10) $280,000

Paid-In Capital in excess of Par - Common share $120,000

(c)

Cash ( 4000 x 107 ) $428,000

Preferred Stock (4000 x $100) $400,000

Paid-In Capital in excess of Par - Preferred share $28,000

It will be reported in balance sheet as follow:

Equity $

Preferred Stock 400,000

Paid-In Capital in excess of Par - Preferred share 28,000

Explanation:

(a) Last dividend was paid on December 31, 2014, the subsequent 3 years are outstanding until December 31, 2017, so the total payable dividend is $240,000 which will be reported on Balance sheet.

(b) 4000 preferred shares on par value are converted to 7 common shares each at $10 par value.

(c) Preferred stock issued @ $107 will be reported as Preferred stock of $400,000 and Paid-In Capital in excess of Par - Preferred share of $28,000.

Suppose that Italy and Austria both produce fish and shoes. Italy’s opportunity cost of producing a pair of shoes is 5 pounds of fish, while Austria’s opportunity cost of producing a pair of shoes is 10 pounds of fish. By comparing the opportunity cost of producing shoes in the two countries, you can tell that _____ has a comparative advantage in the production of shoes, and ______ has a comparative advantage in the production of fish.

Suppose that Italy and Austria consider trading shoes and fish with each other. Italy can gain from specialization and trade as long as it receives more than _______ of fish for each pair of shoes it exports to Austria. Similarly, Austria can gain from trade as long as it receives more than _______ of shoes for each pound of fish it exports to Italy.

Based on your answers to the previous question, which of the following terms of trade (that is, price of shoes in terms of fish) would allow both Austria and Italy to gain from trade? Check all that apply.

(A) 8 pounds of fish per pair of shoes
(B) 1 pound of fish per pair of shoes
(C) 15 pounds of fish per pair of shoes
(D) 3 pounds of fish per pair of shoes

Answers

Answer:

Section 1..... Italy has a comparative advantage in the production of shoes, and Austria has a comparative advantage in the production of fish.

Section 2.... 5 pounds of fish, ; 1/10 pairs of shoes

Section 3..... A and C.

Explanation:

The comparative advantage is known to be a term that is in use in the economic world,where a country or company has the ability of producing goods at extremely lower cost compared to that of its partners or competitors.

This is very important because, the country or company will be able to produce its goods by making use of fewer resources.

And thereby gives the country or company an edge in selling its goods at a reasonable lower price when compared with that of its competitors.

In this case, it is summarized or concluded that, Italy has a lower opportunity cost of producing shoes. So, Italy has a comparative advantage in shoes and Sweden has a comparative advantage in fish.

Free-Flo Pipes & Plumbing Corporation is a private employer involved in an employment discrimination suit under the Civil Rights Act. Punitive damages may be recovered against Free-Flo only if the employer ...a. can easily afford to pay the amount.
b. has one hundred or more employees.
c. consents.
d. acted with malice or reckless indifference.

Answers

Answer: Acted with mallice and reckless indifference

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In the month of September, a department had 500 units in the beginning work in processinventory that were 60% complete. These units had $30,000 of materials costs and$22,500 of conversion costs. Materials are added at the beginning of the process andconversion costs are added uniformly throughout the process. During September, 10,000units were completed and transferred to the finished goods inventory and there were2,000 units that were 25% complete in the ending work in process inventory onSeptember 30. During September, manufacturing costs charged to the department were:Materials $690,000; Conversion costs $765,000.The cost assigned to the units transferred to finished goods during September was

Answers

Answer:

135,000 transferred out under Weighted average method

Explanation:

W/A method:

equivalent units materials 10,000 + 2,000 = 12,000 units at 100%

material cost: 690,000 + 30,000 = 720,000

720,000 / 12,000 = 60

equivalent units conversion 10,000 + 500 = 10,500

conversion cost 22,500 + 765,000 = 787,500

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75 + 60 = 135 cost per unit

10,000 x 135 = 135,000 transferred out

Payments made to an insurance company in return for a policy of insurance are called :A. risk expenses
B. premiums
C. risk expenditures
D. deductibles

Answers

Answer:

The answer is B.

Explanation:

A premium is the money a business or an individual pays for an insurance policy or it is the price of an insurance policy. They are many policies individuals or businesses can buy and they include healthcare insurance, home insurance, auto insurance, life etc.

Premium can be paid monthly, quarterly, semi-annually or yearly.

The premium paid by a business or an individual is income for the insurance company. Businesses or individuals pay premium in advance. While premium paid in advance is an asset to the business or individual at initiation, it is a liability to the insurance company.

Answer:

The correct answer is letter "B": premiums.

Explanation:

Insurance premiums are the payments individuals make to companies providing policies for the coverage of health care, vehicles, and home. Once an individual enrolls for insurance earns the obligation of making payments to the insurance company so they can render the services agreed on the policy. Premiums are calculated according to the risk of the insured in using the coverage and are paid on a regular basis or in a lump sum.

The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done.a) true
b) false

Answers

The total overhead variance is the difference between actual overhead cost and overhead cost applied to work done is True

Final answer:

The statement in question is true. Overhead variance is determined by the difference between actual and applied overhead costs. This kind of analysis helps in understanding cost inefficiencies and making future budgets.

Explanation:

The statement 'The total overhead variance is the difference between actual overhead costs and overhead costs applied to work done' is true. In cost accounting, overhead variance is indeed determined by the difference between the real, or actual overhead expenses for a certain period and the overhead costs which were anticipated or pre-applied to the work done in that same period. This kind of variance analysis helps the business to understand where and how their cost estimates were off, and make necessary adjustments for future cost predictions and budgeting. For example, if the actual overhead costs are higher than the applied overhead costs, it could signify inefficiency in the production process. Conversely, if the applied overhead costs are higher than the actual costs, it signifies cost efficiency.

Learn more about Overhead Variance here:

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