At the beginning of the year (January 1), Buffalo Drilling has $10,000 of common stock outstanding and retained earnings of $7,5
00. During the year, Buffalo reports net income of $7,800 and pays dividends of $2,500. In addition, Buffalo issues additional common stock for $7,300. Required: Prepare the statement of stockholders' equity at the end of the year (December 31).
1 answer:
Answer:
Explanation:
For preparing the statement, first we have to compute the ending balance of the common stock and the retained earning
Ending balance of the common stock = Beginning balance + Additional common stock issued
= $10,000 + $7,300
= $17,300
Ending balance of the retained earnings = Beginning balance + Net income - dividend paid
= $7,500 + $7,800 - $2,500
= $12,800
So, the total stockholder equity = Ending balance of the common stock + Ending balance of the retained earnings
= $17,300 + $12,800
= $30,100
The statement of stockholder equity is shown in the spreadsheet. Kindly find the attachment below.
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Answer:
The capacity of the lathe department is 3200 parts/week. The workers capacity is the bottleneck.
Explanation:
In this case we have to compare the machine capacity and the worker capacity, and detecting shich one is limitating the capacity of the department.
Machine capacity
The time it takes for a machine to process a batch is
In 40-hour week, every machine can process 2 batches/week.
With 20 machines, the capacity of the department is 2*20=40 batch/week (4000 pcs/week).
Workers capacity
With 40-hour week and 5-hours setup, every worker can make (40/5)=8 setups a week.
If the department has 4 workers, the amount of setups that can be done is 4*8=32 setups/week. That means that only 32 batches can be processed per week (3200 pcs/week).
The workers resource is the limitating capacity, and therefore the capacity of the lathe department.