Answer:
Option B, both input and output prices will increase
Explanation:
Since the demand far smart watches is increasing, the price of watches will escalate to cater the opportunity cost. With the rising demand for smart watch, the demand for specialized input will also increase. Considering the growth in demand for specialized input, its cost shall also escalate to take the benefit of opportunity. Along with raw material, variable costs such as transportation, manpower, electricity etc. will also increase both in input (bringing raw material and producing final product) and output (export of the final product)
In nut shell, both the input and output price will increase.
Answer:
C. Expense $300 of the expense on the income statement.
Explanation:
The correct answer is C.
On 31 December 2016, Sengal Company should report Rent expense of $300 on the income statement.
The initial journal entry was:
Dr Prepaid rent $1, 200
Cr Cash $1, 200
This journal entry recognizes the prepaid rent as an asset to the company because the rent is paid in advance, and they have not yet made use of the property they are renting. The payment is an annual payment, meaning that it is for 12 months. Assuming that the end of the financial year is at 31 December 2016, we know that a portion of the $1, 200 is in excess.
The monthly rent expense is $1,200 / 12 = $100. This means that only $100 is the expense for each month. By 31 December, only $300 was the rent expense. [ $100 x 3]. Sengal Company had paid $900 [$1, 200 - $300] in advance and that $900 was to remain as an asset (prepaid rent). The $300 should be recorded as an expense in the income statement and removed as an asset from the balance sheet.
The subsequent journal entry to record the expense is:
Dr Rent expense $300
Cr Prepaid rent $300
At the end of the financial year [31 December 2016], all income statement accounts must be correctly accounted for. This is because all income and expenses are closed of at year end and are not carried forward into the next financial year. This is according to the GAAP principle of ‘Matching’ which states that all income and expenses should be matched to the correct year in which they occur.
Answer:
27.79
Explanation:
According to the given situation, the computation of average fixed inspection cost per unit is shown below:-
Average fixed cost of inspection = Inspection cost ÷ Machine hous in a month
= $197,309 ÷ 7,100
= 27.79
Therefore for computing the average fixed inspection cost per unit we simply applied the above formula.
Answer:
A
Explanation:
In this question, we will calculate the appropriate total budget for the department.
We employ a mathematical approach as follows;
direct labor =$136,000
direct material =$156,000
fixed factory overhead = $10,100
total cost will be ---- 136,000 + 156,000+ 10,100 = $302,100 (for 7,000 hrs of production)
the cost of 1 hr of production is 302,100/7,000= $43.16
so in order to extend it to 10,300 we need (10,300-7,000) = 3,300 more hrs of production
3,300 * 43.16 = 142,419
adding this to 302,100 + 142,419 = $444,519
Answer:
The answer is:
April 10, 2019:
Dr Cash 96,900
Cr Treasury stock 91,800
Cr Paid-in capital 5,100
(to record resell of 1,700 repurchase shares at $57)
Explanation:
While the share was repurchased at $54 each; the Treasury stock account is debited at 54 x 1,700 = 91,800. Thus, when resell takes place, treasury stock account must be credited by 91,800.
Cash receipt is 57 x 1,700 = 96,900. Thus, this amount is debited in Cash Account.
The difference between the Dr Cash and Cr Treasury stock will Credited in to Paid-in Capital Account at the amount 5,100; which is also calculated as 1,700 x ( 57-54).
