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2 years ago

Grants Corporation prepared the following two income statements (simplified for illustrative purposes):

Business

1 answer:

SOVA2 [1]2 years ago

4 0

Corrected income statement for each quarter

Particulars First Quarter Second Quarter

Sales Revenue 12200 18800

Cost of goods sold

Beginning inventory 4100 4030

Purchases 3100 12700

Goods available for sale 7200 16730

Ending inventory 4030 9000

Cost of goods sold 3170 7730

Gross profit 9030 11070

Operating expenses 4800 5700

Pretax income 4230 5370

The income statement is one of the most common and important financial statements. The income statement, also known as the income statement (P&L), summarizes all income and expenses over a period of time, including the cumulative impact of income, profits, expenses, and loss transactions. The basic formula for the income statement is Income - Expenses = Net Income.

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When the activity level declines within the relevant range, what should happen with respect to the fixed cost per unit and varia

viktelen [127]

Answer:

The correct answer is option C.

Explanation:

The fixed costs are the cost that does not vary with the level of output. It does not vary with the level of activity. The total fixed cost remains constant in the entire production process.

The fixed cost per unit is the ratio of total fixed cost and level of output. It decreases as the output level increases and rises with a decline in activity.

The variable cost is the cost that is incurred on the variable inputs used in the production process. It directly varies with the volume of activity. The total variable cost will increase with the increase of output as more variable inputs are employed.

The variable cost per unit is the cost incurred on each unit of output. It does not change with the level of activity unless there is a change in input prices.

8 0

3 years ago

Consider Frank’s decision to go to college. If he goes to college, he will spend $21,000 on tuition, $11,000 on room and board,

slavikrds [6]

Consider Frank’s decision to go to college. Frank’s cost of going to college is $42,600.

What is the cost?

The term cost refers to the actual money are spend on the manufacturing of the product. The product are manufacture to spend on money are raw material, transportation, wages, salary, and other expenses add. The all expenses are add to identify the cost.

Frank was spend on money to $21,000 on tuition, $11,000 on room and board, $1,800 on books, 8800 to add the cost. The calculation was ($21,000 + $11,000 + $1,800 + $8800 ($16,000—$7,200) = 42,600. Frank’s cost of going to college is $42,600.

As a result, Frank’s cost of going to college is $42,600.

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5 0

1 year ago

Park Ridge Company is considering the replacement of a machine that is presently used in production. The following data are avai

Ainat [17]

Answer:

The Relevant Cost for Five Years $52,000.00

Explanation:

‘Relevant costs’ can be defined as any cost relevant to a decision. A matter is relevant if there is a change in cash flow that is caused by the decision.

The Park Ridge Company's Relevant Old Machine Cost for Five Years is

Disposal value now $32,000.00

Annual cash operating costs $20,000.00

Relevant Cost for Five Years $52,000.00

Old Machine

Original cost $200,000 is Sunk Cost

Useful life in years 10 5 - Will be used for the calculation of Depreciation, Therefore is an Irrelevant cost

Current age in years 5 0 - irrelevant year

Book value $100,000 - are not cash flows and so are not relevant.

Disposal value now $32,000 -

Disposal value in 5 years 0 is without a cost

4 0

3 years ago

Sales revenue for a sporting goods store amounted to $528,000 for the current period. All sales are on account and are subject t

weqwewe [10]

Answer:

The answer is A. A debit to Accounts Receivable for $ 586,080

Explanation:

Sales tax is an additional amount of money one pays based on a percentage of the selling price of goods and services that are purchased.

The sales tax amount will be added to sales revenue to form the total bill.

Sales revenue ----------------- $528,00

Sales tax -------------------------- 11%

Sales tax amount

$528,00 x 0.11

= $58,080

Therefore, total bill is:

$528,00 + $58,080

=$586,080.

Debit increases an asset(accounts receivable) while credit decreases an asset(accounts receivable).

Since the accounts receivable will increase, it will be on debit side.

8 0

3 years ago

Vista Camera Services started the year with total assets of $ 100 comma 000 and total liabilities of $ 55 comma 000. The revenue

Lubov Fominskaja [6]

Answer:

The amount of stockholders' equity at the end of the year is $35,000

Explanation:

For computing the ending balance of the stockholder equity, first we have to compute the beginning balance of equity which is shown below:

Total assets = Total liabilities + stockholder equity

$100,000 = $55,000 + stockholder equity

So, stockholder equity = $100,000 - $55,000

= $45,000

Now the ending balance of stockholder equity would equal to

= Opening balance of stockholder equity + revenues - expenses - dividend paid

= $45,000 + $120,000 - $80,000 - $50,000

= $35,000

4 0

3 years ago