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Alex73 [517]
3 years ago
7

The following transactions occur for Badger Biking Company during the month of June: Provide services to customers on account fo

r $35,000. Receive cash of $27,000 from customers in (a) above. Purchase bike equipment by signing a note with the bank for $20,000. Pay utilities of $3,500 for the current month. Analyze each transaction and indicate the amount of increases and decreases in the accounting equation. (Decreases to account classifications should be entered as a negative.)
Business
1 answer:
Taya2010 [7]3 years ago
6 0

Answer:

a) Assets increase by 35,000 (account receivable )

   Equity increase by 35,000 (sales revenue)

b) no effect

c) Assets increase by 20,000 (equipment)

Liabilities increase by 20,000 (note payable)

d) Assets decrease by 3500 (cash)

   Equity decrease by 3500 (utilities expense)

Explanation:

Accounting Equation:

Assets = Liaiblities + Equity

Assets: things and right owned by the company and able to generate cash in the future

Liabilities: obligation to do or pay assumed by the company

Equity: contribution from owners and earnings/losses

a) Provide services to customers on account for $35,000.

As the company has the right to claim the invoince aginst his customers and is also earning a profit from this sale

b) Receive cash of $27,000 from customers in (a) above.

we are "trading" one assets (account receivable) for another (cash) As the amount collected decerase the amount owed by the customer the effect of income from cash and decrease in amount to collect balance.

c) Purchase bike equipment by signing a note with the bank for $20,000.

the new equipment is an asset, it wil lgenerate earnings in the future. While the promissory note is an obligation thus, liability.

d) Pay utilities of $3,500 for the current mont.

the utulities paid will not generate incoem in the future are cost incurred thus, expenses which decreases the earnings of the business.

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Lindsey Company uses activity-based costing. The company has two products: A and B. The annual production and sales of Product A
saul85 [17]

Answer:The activity-based costing cost per unit of Product A=$9.21

Explanation:

                             Product A       Product B

Units Produced    8000 units      6000 units

Activity Cost Pool Total Cost Product A Product B  Total Activity

Activity 1                  $26,400       170             380          550

Activity 2                  $54,365       950            360         1,310

Activity 3                   $136,880     900            3,820      4,720

 

              Activity−basedcost  for Poduct A

Activity−basedcost for Activity1= total Cost/total no. of activityx activity for particular product which is product A

=26,400/550 x 170= 8160

Activity−basedcost for Activity2= total Cost/total no. of activityx activity for particular product which is product A

=54,365/1310 x 950=39,425

Activity−basedcost for Activity3= total Cost/total no. of activityx activity for particular product which is product A

=136,880/4720 x 900=26100

Total activity based cost for Product A = $8,160 + $39,425 +$26,100=$73,685

The activity-based costing cost per unit of Product A = Total activity based cost for Product A/ Units Produced  for product A=$73,685/8000=$9.21

6 0
2 years ago
A statue is decided by the courts. <br><br> True <br> False
kvasek [131]

Answer:

False is the correct answer.

Explanation:

8 0
2 years ago
A truck acquired at a cost of $80,000 has an estimated residual value of $8,000, has an estimated useful life of 200,000 miles,
Alexus [3.1K]

Answer:

a. $72,000

b. $0.36

c. $6,480

Explanation:

a. Depreciation cost = Cost of truck - Residual value

= $80,000 - $8,000

= $72,000

b. The depreciation rate = (Cost of truck - Residual value) ÷ Estimated total production

= ($80,000 - $8,000) ÷ 200,000 miles

= $72,000 ÷ 200,000 miles

= $0.36

c. The units-of-activity depreciation for the year per mile = Driven miles × Depreciation rate

= 18,000 × $0.36

= $6,480

6 0
3 years ago
Capital requirements for banks serve all of the following purposes EXCEPT:________.a.to offset the change in incentives caused b
SCORPION-xisa [38]

Answer:

b. to reduce deposits

Explanation:

A Capital requirement refers to the amount of capital that a financial institution must have to meet the requirements set by it's financial regulator. All of the answers provided are purposes that this hopes to accomplish except for reducing deposits. It actually hopes to increase deposits which means more customers that are coming in.

3 0
3 years ago
A 3-year project is expected to produce a cash flow of $82,400 in the first year and $148,600 in the second year. The project ha
givi [52]

Answer:

$163,100

Explanation:

First find the present value of cashflows at year 1 and 2

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PV = FV/(1+r)^n

PV = 82,400/(1.1275)^1

PV = $73082.0399

<u>PV of  $148,600;</u>

PV = FV/(1+r)^n

PV = 148,600 /(1.1275)^2

PV = $116,892.2473

From the cumulative present value of 303,764.34, find the balance after deducting the above PVs;

PV of cashflow yr3 = $303,764.34 -$73082.0399 -$116,892.2473

PV of cashflow yr3 = $113,790.053

Next, calculate year 3's cashflow;

Year 3 cashflow = 113790.053(1.1275)^3

Year 3 cashflow = $163,099.996

Expected cashflow in third year is approximately $163,100

3 0
3 years ago
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