Answer:
1) CR Cash/Bank $51,229.35 , DR Bonds Receivable Account $50,000 and DR Premium on Bond Payable Account.
(2) Please see attached for Investment Interest Income Amortization Schedule
(3) Recording of Interest Received
June 30, 2019
CR Income statement (Interest Received) -$3,000, CR Premium on Bond Receivable $250
December 31, 2021
CR Income Statement (Interest Received) -$2915.44
Explanation:
(1) CR Cash/Bank $51,229.35 , DR Bonds Receivable Account $50,000 and DR Premium on Bond Payable Account.
(2) Please see attached for Investment Interest Income Amortization Schedule
(3) Recording of Interest Received
June 30, 2019
CR Income statement (Interest Received) -$3,000, CR Premium on Bond Receivable $250
December 31, 2021
CR Income Statement (Interest Received) -$2915.44
Answer:
Explanation:
Present value of annuity due = (1+interest rate)*Annuity[1-(1+interest rate)^ -time period]/rate
=(1+0.075)*25000*[1-(1.075)^-15]/0.075
=$25000*9.489153726
=$237,228.84
Answer:
Instructions are listed below
Explanation:
Giving the following information:
Total manufacturing overhead= $ 2,986,000
The firm estimates total direct labor cost for the year to be $1,866,250.
The firm uses direct labor cost as the cost driver to apply overhead to clients.
1) Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base= 2986000/1866250= $1.6 per direct labor $
2) the firm worked for many clients; data for two of them follow: Gargus account Direct labor $ 3,200
Feller account Direct labor $ 9,200
Allocated MOH= Actual amount of allocation base*Estimated manufacturing overhead rate
Gargus overhead= 3200*1.6= 5120
Feller= 9200*1.6= 14720
3) Total cost Gargus= 3200 + 5120= $8,320
TC Feller= 14720 + 9200= $23,920
Answer:
Total cash disbursement= $40,210
Explanation:
Giving the following information:
The sales budget shows 2,700 units are planned to be sold in March. The variable selling and administrative expense are $3.20 per unit.
The budgeted fixed selling and administrative expense are $35,770 per month, which includes depreciation of $4,200 per month.
Th<u>e depreciation expense is not a cash disbursement. </u>
Total cash disbursement= total variable cost + total fixed cost
Total cash disbursement= 2,700*3.2 + (35,770 - 4,200)
Total cash disbursement= $40,210
Answer:
A. $22,000 decrease
Explanation:
The reason behind Granfield Company interested in predicting the increase or decrease in net income when they purchase new machinery by selling an old one is because you have the Cash coming through so that they don't run out of money. As per Generally Accepted Accounting Principles (GAAP) the other name of Profits is Net Income. The company may not have Cash in the bank but their Net Income may be in millions. So, when Companies like Granfield when usually invests are usually concerned about their investments that weather they will be profitable or not. In this instance of Granfield Company, they predict that by acquiring the new machinery they will save on manufacturing overhead by $19,000 over 4 years which accumulates to $76,000.
Annual Savings = $19,000 x 4 = $76,000
We are told to ignore the time value of money here so if the proceeds from previous machinery are $22,000, then add the proceeds from machinery and annual savings and we get a total of $98,000
Annual Savings $76,000
Add: Proceeds from Sale of Machine $22,000
Total Savings $98,000
To find the increase or decrease in net income or the effect of purchase of new machinery and disposal of old machinery on net income can be calculated as follows;
Total Savings $98,000
Less: Purchase of New Machinery $120,000
Decrease in Net Income $22,000
Hence the Net Income will decrease by $22,000 which means there will be a decrease in retained earnings and stockholders' equity.
Option A is the Correct answer.
