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Alja [10]
3 years ago
6

Aurora Corporation operated without insurance coverage for the first month of 2018. Then, on February 1, 2018, the company paid

the $4,800 premium on a two-year insurance policy with benefits beginning on that date. The company uses the accrual basis. How much insurance expense will be reported on the company's income statement for the year ended December 31, 2018?
Business
1 answer:
Neporo4naja [7]3 years ago
4 0

Answer:

$2,200

Explanation:

The computation of the insurance expense is shown below:

Given that

Premium on a two-year insurance policy = $4,800

So by considering this, under the accrual basis, the amount of insurance expense is

= Premium on a two-year insurance policy ÷ number of years -   Premium on a two-year insurance policy ÷ number of years × number of months ÷ total number of months in a year

= $4,800 ÷ 2 years  - $4,800 ÷ 2 years × 1 months ÷ 12 months

= $2,400 - $200

= $2,200

Or we can calculate it for 11 months also

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Ajax, Inc., issued callable bonds with a par value of $1,000,000 that require the payment of a call premium of $10,000. The bond
ivann1987 [24]

Answer:

Explanation:

The journal entry is shown below:

On September 30

Bonds payable A/c Dr $1,000,000

Loss on bond retirement A/c Dr $20,000

          To Discount on Bond A/c  $10,000

          To Cash A/c $1,010,000

(Being the callable bond is recorded)

The computation is shown below:

For cash

= Par value of bond + Premium

= $1,000,000 + $10,000

= $1,010,000

For Loss, it would be

= $1,010,000 - $990,000

= $20,000

And, the remaining amount would be transferred to discount on bond

7 0
3 years ago
The SCOR model looks at a firm’s supply chain activities in three levels of increasing detail. Level 1 views SCM activities as
Tpy6a [65]

Answer:

Source processes

Explanation:

The SCOR model looks at a firm´s supply chain activities in three levels of increasing detail. Level 1 views SCM activities as being structured around five core management processes including <u>Source processes</u> which are processes that procure goods and services to meet planned or actual demand.

Supply chain operations reference (SCOR):  It is a strategic planning tool that helps in identifying, improving and communicating supply chain management decisions within the company. It is a continuous improvement process and establishing a benchmark for the industry. It also works to develop a business process for satisfying customer´s demand. SCOR is based on five management process:

  • Plan
  • Sources.
  • Make.
  • Deliver.
  • Return.

Source process: This process of supply chain management is defined as steps to procure goods and services to meet the requirement for infrastructural arrangements.

8 0
3 years ago
Q 6.41: Which of the following companies is most likely to have lost sales due to an inventory shortage? Company 1 has an invent
V125BC [204]

Answer:

Company 1 is most likely to have lost sales due to an inventory shortage.

Explanation:

Inventory turnover is the ratio that how many time a business has sold or replaced the inventory during a given period. A business is considered more profitable if it has high inventory turnover.

Company with highest Inventory turnover may lost sales due to inventory shortage.  Company 1 1 has the highest inventory turnover of 46.3. Which may lead to to the shortage of stock because the inventory in stock is more likely to sold earlier than other companies. High inventory turnover will lead to low inventory days.

6 0
3 years ago
The form of business organization where an entity is legally separate from its owners and issues shares of stock is a.
Anna [14]

Answer:

corporation

Explanation:

4 0
2 years ago
Many companies recognize three major categories of costs of manufacturing a product. These are direct materials, direct labor, a
abruzzese [7]

Answer:

a)

Explanation:

a) is the overhead cost

b) are direct materials

c) is direct labor cost

d) is the overhead cost

7 0
3 years ago
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