Answer:
since the special order does not affect current normal sales, its analysis should only consider incremental expenses, not regular expenses:
A) Income statement without the special order
total revenue = $68 x 80,100 = $5,446,800
- COGS = ($2,446,880)
- Direct materials $897,120
- Direct labor $608,760
- Overhead $941,000
gross profit = $2,999,920
- SG&A = ($1,022,000)
- Selling exp. $559,000
- Administrative exp. $463,000
net income = $1,977,920
B) incremental revenue from special order = 14,900 x $63 = $938,700
incremental costs:
- direct materials = ($897,120 / 80,100 units) x 17,900 = $200,480
- direct labor = ($608,760 / 80,100 units) x 17,900 = $136,040
- overhead = ($658,700 / 80,100 units) x 17,900 = $147,200
- selling expenses = [($335,400 / 80,100 units) x 17,900] + ($2.70 x 17,900) = $74,952 + $48,330 = $123,282
- administrative expenses = $940
- total incremental costs = $607,942
incremental gain from special order = $938,700 - $607,942 = $330,758
Income statement with the special order
total revenue = $6,385,500
- COGS = ($2,930,600)
- Direct materials $1,097,600
- Direct labor $744,800
- Overhead $1,088,200
gross profit = $3,454,900
- SG&A = ($1,146,222)
- Selling exp. $682,282
- Administrative exp. $463,940
net income = $2,308,678
Answer:
D - Assets: No Effect, Liabilities: No Effect, Stockholders Equity: No Effect
Explanation:
According to the ALLOWANCE METHOD, when an account receivable is written off as uncollectible, the record is: Debit on Allowance for Doubtful Accounts and credit on Accounts Receivable for the same amount. Allowance for Doubtful Accounts has credit balance, because is a contra-asset account, and Accounts Receivable has debit balance so the accounting entry has no effect on the total amount of asset and don´t affect the others components of the financial statements. The expense was recorded when the Allowance for Doubtful Accounts was recognized against Bad Debts Expense at the end of the previous accounting period.
Answer:
Planner
Explanation:
I am not 100% sure. But I think I'm close.
Sorry anyways.
Answer:
The correct answer is "2,40,000". The further explanation is given below.
Explanation:
The given fair value is:
= $240,000
The presentation in books of lessee will be:
⇒
⇒
On putting the values, we get
⇒
⇒
⇒ ($)
Presentation in books of Lessor
, the fair value of assets will be
= ($)