Room: 002 -AM \$?????: Financial Accounting II Prepare Joumal Enties to record Z Com's transaction d : (4pts) a. Sold \( \$ 420,800 \) of merchandise on credit b. Wrote off \( \$ 2,500 \) of uncollectible account receivable c. Received 238,000 cash in payment of account receivable d. In adjusting the account on Dec 31 , the company estimated that \( 1 \% \) of account receivable will be uncollectible. Fee company purchase a machine in its factory at January 2 at a cost of \( \$ 52,200 \). The machine's useful life is estimate at 10 years, or 360,000 units of product, with a salvage value \( \$ 5,000 \). During the second year the machine produced 30,000 units of product. Determine the machine's second year depreciation under the (3pts) a. Straight-line method b. Units of production c. Double declining balance method AB Co. disposes of a machine costing \( \$ 50,000 \) with accumulated depreciation of \( \$ 32,800 \). Prepare the journal entries to record the disposal under each following separate assumptions: \( (3 p t s) \) a. Machine is sold for \( \$ 10,000 \) cash. b. Machine is traded in a similar but newer machine having a cost \( \$ 54,500 \). A \( \$ 15,000 \) trade in allowance is received is received, and the balance is paid in cash. Joo Co. borrows \( \$ 250,000 \) cash on December 5,2007 , by signing a 90 days, \( 9 \% \) note . (10pts) a. On what date does this note mature? . How much interest expense result from this note in 2007 and 2008 ? 2. Journal Entries (1) Issuance of note, (2) Accrual interest on 2007, (3) Payment of note at maturity 6 ??? ????
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Journal entries for Z Com's transactions: a. Sold $420,800 of merchandise on credit: Accounts Receivable - $420,800 Sales - $420,800 b. Wrote off $2,500 of uncollectible accounts receivable: Bad Debt Expense - $2,500 Allowance for Doubtful Accounts - $2,500 c. Show more…
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Cash budgeting, budgeted balance sheet (Continuation of 6 -42) (Appendix) Refer to the information in Problem $6-42$ Budgeted balances at January 31,2018 are as follows: Customer invoices are payable within 30 days. From past experience, Skulas's accountant projects $40 \%$ of invoices will be collected in the month invoiced, and $60 \%$ will be collected in the following month. Accounts payable relates only to the purchase of direct materials. Direct materials are purchased on credit with $50 \%$ of direct materials purchases paid during the month of the purchase, and $50 \%$ paid in the month following purchase. Fixed manufacturing overhead costs include $ 64,000$ of depreciation costs and fixed nonmanufacturing overhead costs include $ 10,000$ of depreciation costs. Direct manufacturing labor and the remaining manufacturing and nonmanufacturing overhead costs are paid monthly. All property, plant, and equipment acquired during January 2018 were purchased on credit and did not entail any outflow of cash. There were no borrowings or repayments with respect to long-term liabilities in January 2018 On December $15,2017,$ Skulas's board of directors voted to pay a $ 160,000$ dividend to stockholders on January 31,2018 1. Prepare a cash budget for January $2018 .$ Show supporting schedules for the calculation of collection of receivables and payments of accounts payable, and for disbursements for fixed manufacturing and nonmanufacturing overhead. 2. Skulas is interested in maintaining a minimum cash balance of $ 120,000$ at the end of each month. Will Skulas be in a position to pay the $ 160,000$ dividend on January $31 ?$ 3. Why do Skulas's managers prepare a cash budget in addition to the revenue, expenses, and operating income budget? 4. Prepare a budgeted balance sheet for January 31,2018 by calculating the January 31,2018 balances in (a) cash (b) accounts receivable (c) inventory (d) accounts payable and (e) plugging in the balance for stockholders' equity.
1. How would the answer to Problem $2-34$ be modified if you were asked for a schedule of cost of goods manufactured and sold instead of a schedule of cost of goods manufactured? Be specific. 2. Would the sales manager's salary (included in marketing, distribution, and customer-service costs) be accounted for any differently if the Howell Corporation were a merchandising-sector company instead of a manufacturing-sector company? Using the flow of manufacturing costs outlined in Exhibit $2-9$ (p. 42 ), describe how the wages of an assembler in the plant would be accounted for in this manufacturing company. 3. Plant supervisory salaries are usually regarded as manufacturing overhead costs. When might some of these costs be regarded as direct manufacturing costs? Give an example. 4. Suppose that both the direct materials used and the plant and equipment depreciation are related to the manufacture of 1 million units of product. What is the unit cost for the direct materials assigned to those units? What is the unit cost for plant and equipment depreciation? Assume that yearly plant and equipment depreciation is computed on a straight-line basis. 5. Assume that the implied cost-behavior patterns in requirement 4 persist. That is, direct material costs behave as a variable cost, and plant and equipment depreciation behaves as a fixed cost. Repeat the computations in requirement $4,$ assuming that the costs are being predicted for the manufacture of 1.2 million units of product. How would the total costs be affected? 6. As a management accountant, explain concisely to the president why the unit costs differed in requirements 4 and 5.
Various cost-behavior patterns. (CPA, adapted) Select the graph that matches the numbered manufacturing cost data (requirements 1-9). Indicate by letter which graph best fits the situation or item described. The vertical axes of the graphs represent total cost, and the horizontal axes represent units produced during a calendar year. In each case, the zero point of dollars and production is at the intersection of the two axes. The graphs may be used more than once. 1. Annual depreciation of equipment, where the amount of depreciation charged is computed by the machine-hours method. 2. Electricity bill-a flat fixed charge, plus a variable cost after a certain number of kilowatt-hours are used, in which the quantity of kilowatt-hours used varies proportionately with quantity of units produced. 3. City water bill, which is computed as follows: The gallons of water used vary proportionately with the quantity of production output. 4. cost of direct materials, where direct material cost per unit produced decreases with each pound of material used (for example, if 1 pound is used, the cost is $\$ 10$; if 2 pounds are used, the cost is $\$ 19.98$; if 3 pounds are used, the cost is $\$ 29.94$, with a minimum cost per unit of $\$ 9.20$ 5. Annual depreciation of equipment, where the amount is computed by the straight-line method. When the depreciation schedule was prepared, it was anticipated that the obsolescence factor would be greater than the wear-and-tear factor. 6. Rent on a manufacturing plant donated by the city, where the agreement calls for a fixed-fee payment unless 200,000 labor-hours are worked, in which case no rent is paid. 7. Salaries of repair personnel, where one person is needed for every 1,000 machine-hours or less (that is, 0 to 1,000 hours requires one person, 1,001 to 2,000 hours requires two people, and so onl. 8. cost of direct materials used (assume no quantity discounts). 9. Rent on a manufacturing plant donated by the county, where the agreement calls for rent of $\$ 100,000$ to be reduced by $\$ 1$ for each direct manufacturing labor-hour worked in excess of 200,000 hours, but a minimum rental fee of $\$ 20,000$ must be paid.
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