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Nostrana [21]
3 years ago
7

Matthew, Inc. owns 30 percent of the outstanding stock of Lindman Company and has the ability to significantly influence the inv

estee’s operations and decision making. On January 1, 2018, the balance in the Investment in Lindman account is $348,000. Amortization associated with this acquisition is $16,900 per year. In 2018, Lindman earns an income of $98,000 and declares cash dividends of $49,000. Previously, in 2017, Lindman had sold inventory costing $29,400 to Matthew for $42,000. Matthew consumed all but 25 percent of this merchandise during 2017 and used the rest during 2018. Lindman sold additional inventory costing $46,200 to Matthew for $70,000 in 2018. Matthew did not consume 40 percent of these 2018 purchases from Lindman until 2019. What amount of equity method income would Matthew recognize in 2018 from its ownership interest in Lindman? What is the equity method balance in the Investment in Lindman account at the end of 2018?
Business
2 answers:
valentina_108 [34]3 years ago
5 0

Answer:

$326186

Explanation:

Matthew, Inc. owns 30 percent of the outstanding stock of Lindman Company and has the ability to significantly influence the investee’s operations and decision making. On January 1, 2018, the balance in the Investment in Lindman account is $348,000. Amortization associated with this acquisition is $16,900 per year. In 2018, Lindman earns an income of $98,000 and declares cash dividends of $49,000. Previously, in 2017, Lindman had sold inventory costing $29,400 to Matthew for $42,000. Matthew consumed all but 25 percent of this merchandise during 2017 and used the rest during 2018. Lindman sold additional inventory costing $46,200 to Matthew for $70,000 in 2018. Matthew did not consume 40 percent of these 2018 purchases from Lindman until 2019. What amount of equity method income would Matthew recognize in 2018 from its ownership interest in Lindman? What is the equity method balance in the Investment in Lindman account at the end of 2018?

Let's use equity method

The Proportionate share of his investment in 2018 is:

Share % x (Net Income - acquisition amortization +/- upstream profits +/- downstream profits)

30% x (98,000 - 16,900 + No upstream from 2017 as it was sold by end of 2018  + (40% x (70,000 - 46,200)) + No downstream profits

30% x (81,100 + 9520)

30% x 90620

$27186

Equity Balance is:

Cost of investment + Proportionate share of Investment - Dividends

348,000 + 27186 - 49,000

$326186

zepelin [54]3 years ago
4 0
20p and a kit kat init
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If the expected sales volume for the current period is 7,000 units, the desired ending inventory is 400 units, and the beginning
Ksivusya [100]

Answer:

7,000 units

Explanation:

Calculation for the number of units set forth in the production budget, representing total production for the current period

Using this formula

Number of units =Current period +Ending inventory - Beginning inventory

Where,

Current period =7,000 units

Ending inventory=400 units

Beginning inventory =400 units

Let make plug in the formula above

Number of units =7,000 units + 400 units-400 units

Number of units =7,000 units

Therefore the Number of units will be 7,000 units

5 0
3 years ago
Holly's Ham, Inc. sells hams during the major holiday seasons. During the current year 11,000 hams were sold resulting in $220,0
aalyn [17]

Answer:

The break-even point in sales dollars is: C. $32,000

Explanation:

During the current year 11,000 hams were sold resulting in $220,000 of sales revenue, $55,000 of variable costs, and $24,000 of fixed cost.

Contribution margin ratio = (Sales - Total Variable cost)/Sales = ($220,000 - $55,000)/$220,000 = 0.75

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Break-even point in sales dollars = Fixed cost/Contribution margin ratio = $24,000/0.75 = $32,000

4 0
3 years ago
The following trial balance was taken from the records of Fairport Manufacturing Company at the beginning of 2019:
Rainbow [258]

Answer:

Fairport Manufacturing Company

T-accounts

Cash

Account Titles                                Debit        Credit

Beginning balance                   $ 20,000

Accounts payable                                         $10,500

Wages payable                                               18,000

Selling and distribution expense                     1,800

Utilities and Rent for production                    9,300

Sales Revenue                            36,000

Ending balance                                           $16,400

Raw materials inventory

Account Titles                                Debit        Credit

Beginning balance                   $ 1,800

Accounts Payable                      11,400

Work-in-Process                                           $10,800

Ending balance                                              $2,400

Work in process inventory

Account Titles                                Debit        Credit

Beginning balance                   $ 2,400

Raw materials                            10,800

Wages Payable                          19,950

Overhead Applied                      11,970

Finished Goods Inventory                          $24,000

Ending balance                                             $21,120

Finished goods inventory

Account Titles                                Debit        Credit

Beginning balance                   $ 4,200

Work-in-Process                        24,000

Cost of goods sold                                       $25,500

Ending balance                                               $2,700

Property, plant, and equipment

Account Titles                                Debit        Credit

Beginning balance                   $ 15,000

Accumulated depreciation

Account Titles                                Debit        Credit

Beginning balance                                        $ 6,000

Depreciation expense                                     3,000

Ending Balance                         $9,000

Accounts Payable

Account Titles                                Debit        Credit

Raw materials                                               $12,000

Cash                                            $10,500

Ending balance                             $1,500

Wages Payable

Account Titles                               Debit         Credit

Work-in-Process                                          $19,950

Cash                                           $18,000

Ending balance                            $1,950

Common stock

Account Titles                                Debit        Credit

Beginning balance                                        $ 16,800

Retained earnings

Account Titles                                Debit        Credit

Beginning balance                                        $ 20,600

Production Supplies

Account Titles                                Debit        Credit

Accounts Payable                                              $600

Overhead                                      $422

Ending balance                              $178

Overhead Expenses

Account Titles                               Debit          Credit

Work-in-Process                                            $11,970

Cash (Utilities)                               9,300

Depreciation expense                  3,000

Production supplies                         422

Cost of goods sold (Underapplied)                  752

Sales Revenue

Account Titles                                Debit        Credit

Cash                                                             $36,000

Income Summary                       $36,000

Cost of Goods Sold

Account Titles                                Debit        Credit

Finished Goods Inventory       $25,500

Overhead (underapplied)                752

Income Summary                                        $26,252

Selling and Distribution Expense

Account Titles                               Debit          Credit

Cash                                          $1,800

Utilities and Rent

Account Titles                               Debit          Credit

Cash                                            $9,300

Overhead                                                       $9,300

Depreciation Expense - Plant & Equipment

Account Titles                               Debit          Credit

Accumulated Depreciation        $3,000

Overhead                                                       $3,000

b) Schedule of Cost of Goods Manufactured and Sold:

WIP Beginning Inventory         $ 2,400

Raw materials                            10,800

Direct labor                                19,950

Overhead Applied                      11,970

Cost of goods in production  $45,120

Ending WIP Inventory                21,120

Cost of manufactured           $24,000

Finished Goods Inventory     $ 4,200

Cost of manufactured            24,000

Cost of goods available       $28,200

Ending FG Inventory                 2,700

Cost of goods sold              $25,500

Income Statement for the year ended December 31, 2019:

Sales Revenue                      $36,000

Cost of Goods Sold                 26,252

Gross profit                                9,748

Selling and distribution exp.      1,800

Net income                              $7,948

Retained Earnings, January 1, 2019 $20,600

Net income                                             7,948

Retained Earnings, December 31,    $28,548

Balance Sheet as of December 31, 2019:

Assets:

Cash                                          $ 16,400

Raw materials inventory               2,400

Work in process inventory          21,120

Finished goods inventory            2,700

Production Supplies                         178     $42,798

Property, plant, and equipment 15,000

Accumulated depreciation          9,000      $6,000

Total assets                                                $48,798

Liabilities and Equity:

Accounts Payable                                        $1,500

Wages Payable                                              1,950

Total liabilities                                             $3,450

Common stock                         $16,800

Retained earnings                     28,548  $45,348

Total liabilities and equity                       $48,798

Explanation:

a) Data and Calculations:

Trial Balance at January 1, 2019:

Account Titles                                Debit        Credit

Cash                                         $ 20,000

Raw materials inventory                1,800

Work in process inventory           2,400

Finished goods inventory            4,200

Property, plant, and equipment 15,000

Accumulated depreciation                           $ 6,000

Common stock                                               16,800

Retained earnings                                         20,600

Total                                       $ 43,400      $ 43,400

Analysis of Transactions for the period:

1. Raw materials $11,400 Production Supplies $600 Accounts payable $12,000

2. Work-in-Process $10,800 Raw materials $10,800

3. Accounts payable $10,500 Cash $10,500

4. Work-in-Process $19,950 Wages Payable $19,950

5. Wages Payable $18,000 Cash $18,000

6. Work-in-Process $11,970 Overhead Applied $11,970 ($12,600 * 950/1,000)

7. Selling and Administrative expense $1,800 Cash $1,800

8. Utilities and Rent for production $9,300 Cash $9,300

9. Depreciation Expense-Plant and Equipment $3,000 Accumulated Depreciation $3,000

10. Finished Goods Inventory $24,000 Work-in-Process $24,000

11. Cost of Goods Sold $25,500 Finished Goods Inventory $25,500

12. Cash $36,000 Sales Revenue $36,000

13. Overhead $422 Production Supplies $422 ($600 - $178)

14. Cost of Goods Sold $752 Underapplied Overhead $752

Adjusted Trial Balance at December 31, 2019:

Account Titles                                Debit        Credit

Cash                                          $ 16,400

Raw materials inventory               2,400

Work in process inventory          21,120

Finished goods inventory            2,700

Property, plant, and equipment 15,000

Accumulated depreciation                          $ 9,000

Accounts Payable                                            1,500

Wages Payable                                                1,950

Common stock                                               16,800

Retained earnings                                         20,600

Production Supplies                        178

Sales Revenue                                               36,000

Cost of Goods Sold                 26,252

Selling and distribution exp.      1,800

Totals                                    $85,850        $85,850

3 0
2 years ago
How do the Holland Codes help individuals make career choices?
nlexa [21]

Answer:

Holland codes are also known as Holland Occupational Themes, which is a theory based on Vocational choice and careers. The theory was revealed by John L. Holland, who was an American Psychologist.

Explanation:

The Holland codes are involved in career counseling practices and researches. The basic theory was that the occupational preferences of the individuals were surrounded by the underlying character of the individual. The theory is centered on the following six personality traits:

  • Realistic - They like to work with hands, assembling and building things, working on tools and machines. They like to work outdoor.
  • Investigative -  They are more into discovering new ideas, investigating and, asking the questions to solve the problem.
  • Artistic- They are more performance-oriented, more expressive, and good at designing and creating things.
  • Social- They like working with people and are concerned about the welfare and well-being of other people.
  • Enterprising - They like leading, influencing, and encouraging others.
  • Conventional- They like following the procedures to work, planning the events, and work. They also like working indoor.

The Holland codes state that the people who possess similar personality traits aim to create an environment that fits them best and their type of work. Holland further stated that when people choose to work in a situation that is related to their personality, they are more contented and successful.  

7 0
3 years ago
Maturity Dates of Notes Receivable Determine the maturity date and compute the interest for each of the following notes: (Use 36
expeople1 [14]

Answer:

Maturity Dates and Interests of Notes Receivable:

Date of Note          Principal   Interest     Term          Maturity Date

                                                   Rate                       Month       Day   Interest

a. August 5             $6,000         8%     130 days   December   13    $173.33

b. May 10                 16,800          7%     100 days   August        18     326.67

c. October 20         24,000         9%      55 days   December   14     330.00

d. July 06                  4,500        10%      70 days   September  14       87.50

e. September 15      9,000          8%      85 days   December    9     170.00

Total                    $60,300                                                              $1,087.50

Explanation:

a) Data and Calculations:

   Date of Note      Principal   Interest     Term          Maturity Date

                                                   Rate                          Calculations

a. August 5             $6,000         8%     130 days   Dec. 13(26+30+31+30+13)

b. May 10                 16,800          7%     100 days   Aug. 18 (21+30+31+18)

c. October 20         24,000         9%      55 days   Dec. 14 (11+30+14)

d. July 06                  4,500        10%      70 days   Sept. 14 (25+31+14)

e. September 15      9,000          8%      85 days   Dec. 9 (15+31+30+9)

Calculation of Interests:

a. = $173.33 ($6,000 * 8% * 130/360)

b. = $326.67 ($16,800 * 7% * 100/360)

c. = $330.00 ($24,000 * 9% * 55/360)

d. = $87.50 ($4,500 * 10% * 70/360)

e. = $170 ($9,000 * 8% * 85/360)

8 0
3 years ago
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