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3 years ago

Matching is:________.

Business

1 answer:

Kay [80]3 years ago

5 0

Answer:

A. It is a valuation method.

Explanation:

The matching principle is used to assign same costs with the same revenues. For example the inventory bought to make the product would be assigned like wise to assure the guideline of matching principle.

It is a valuation method.

It is used to evaluate the accounting procedures.

For example let us assume that we are selling candies. But the advertisement is run once the candies have been manufactured and sealed. So the matching principle states that the advertisement expenses to be included in the income statement having the corresponding stock of candies manufactured and sold.

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ZanzabumX [31]

When you don't know a certain answer to a customer question be honest and tell them that you don't know the answer to this question however you will ask from your colleague about this question and will revert back to the customer.

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2 years ago

Suppose management estimated the market valuation of some obsolete inventory at $99,000; this inventory was recorded at $120,000

Annette [7]

Answer:

a. An audit adjustment is needed since the best case scenario, where the net realizable value is highest would result in $92,000 - $5,000 = $87,000.

b. the value of inventory must decerase by $99,000 - $87,000 = $12,000, so COGS must increase by that amount:

Dr Cost of goods sold 12,000

Cr Merchandise inventory 12,000

4 0

3 years ago

Warner Corp. sells goods on account for $10,000 on April 2. On April 20, the customer returns $3,000 of the merchandise. The cus

Studentka2010 [4]

Explanation:

The journal entry are as follows

On April 20

Sales returns A/c Dr $3,000

To Account receivable A/c $3,000

(Being the sales returned of goods is recorded)

While recording this given transaction, we debited the sales return account and credited the account receivable account so that the proper posting could be done

6 0

3 years ago

Ikerd Company applies manufacturing overhead to jobs on the basis of machine hours used. Overhead costs are expected to total $3

Slav-nsk [51]

Answer:

a. $2.4

b. $10,000 under-applied

c. Cost of goods sold A/c Dr $10,000

To Manufacturing overhead $10,000

Explanation:

a. The computation of the manufacturing overhead rate is shown below:

Manufacturing overhead rate = (Total estimated manufacturing overhead) ÷ (estimated direct labor-hours)

= $300,000 ÷ 125,000 hours

= $2.4

(B) Now we have to find the actual overhead which equals to

= Actual direct labor-hours × predetermined overhead rate

= 130,000 hours × $2.4

= $312,000

So, the ending overhead equals to

= Actual manufacturing overhead - actual overhead

= $322,000 - $312,000

= $10,000 under-applied

c. The adjusting entry is shown below:

Cost of goods sold A/c Dr $10,000

To Manufacturing overhead $10,000

(Being the under-applied overhead is adjusted)

5 0

3 years ago

intends on adding a new product line. the contribution margin ratio for the new product is 0.2. they have a target operating inc

FrozenT [24]

Answer:

The total fixed costs must be:

$36,000.

Explanation:

a) Data and Calculations:

Contribution margin ratio for the new product = 0.2

Target operating income = $60,000

Targeted sales volume in dollars = $480,000

Fixed costs = targeted sales volume in dollars multiplied by contribution margin ratio, minus target operating income

Fixed costs = ($480,000 * 0.2) - $60,000 = $36,000

b) The focus should be on the break-even formula for dollar sales with a target profit. When the formula is reversed, the fixed costs can be calculated as shown above.

3 0

2 years ago