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Anna35 [415]
3 years ago
14

Primo Industries collected $105,000 from customers in 2019. Of the amount collected, $25,000 was for services performed in 2018.

In addition, Primo performed services worth $40,000 in 2019, which will not be collected until 2020. Primo Industries also paid $72,000 for expenses in 2019. Of the amount paid, $30,000 was for expenses incurred on account in 2018. In addition, Primo incurred $42,000 of expenses in 2019, which will not be paid until 2020.
Required:
a. Compute 2014 cash-basis net income.
b. Compute 2014 accrual-basis net income.
Business
1 answer:
bearhunter [10]3 years ago
5 0

Answer:

a. $33,000.

b. $36,000.

Explanation:

Net income is calculated as sales minus cost of goods sold, selling, general and administrative expenses, operating expenses, depreciation, interest, taxes, and other expenses. It is also called net earnings.

Now, Cash accounting recognizes revenue and expenses only when money changes hands, but accrual accounting recognizes revenue when it's earned, and expenses when they're billed (but not paid).

a. 2014 Cash-basis net income:

Primo Industries collected $105,000 from customers in 2019

Primo Industries also paid $72,000 for expenses in 2019

=105,000-72,000

=$33,000

b. 2014 accrual-basis net income.

=(105,000-25000+40000)-(72000-30000+42000)

=120000-84000

=$36,000

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Answer:

debit Supplies and credit Supplies Expense for $1,060

Explanation:

Based on the information provided within the question it can be said that the best option in this scenario would be to debit Supplies and credit Supplies Expense for $1,060. Since the policy states that they need to expense all office supplies then they must do that, but since they still have $1060 which they do not have then they will need to credit that supply expense and pay it back later.

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3 years ago
Sunland Company, has 14700 shares of 4%, $100 par value, cumulative preferred stock and 60200 shares of $1 par value common stoc
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Answer:

2021 Common Stockholders dividends = $49,600

Explanation:

Preference Shareholders are always paid their dividends first before Common Stockholders. If dividend is not declared, Preference dividends are cumulated to the next period and are due !

<u>2019</u>

Preferred Stockholders Dividends = 14700 x $100 x 4% = $58,800

Common Stockholders dividends = $ 0

<u>2020</u>

Preferred Stockholders Dividends =  $58,800 (2019) + $54,200 (2020)

Common Stockholders dividends = $0

<u>2021</u>

Preferred Stockholders Dividends = $4,600 (2020 arrears) + $58,800 (2021) = $63,400

Common Stockholders dividends = $113,000 - $63,400 = $49,600

3 0
3 years ago
Bade Midwifery's cost formula for its wages and salaries is $1,230 per month plus $240 per birth. For the month of October, the
jasenka [17]

Answer:

wages and salaries activity variance= $1,000 unfavorable

Explanation:

Giving the following information:

Standard:

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Variable= $240 er birth

Actual:

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The actual wages and salaries for the month was $26,470.

To calculate the activity variance for wages, we need to use the following formula:

wages and salaries activity variance= (actual costs - standards costs)

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Answer:

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Explanation:

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6 0
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nadya68 [22]

Answer:

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So the auto insurance agent is also using this strategy with his existing customer, Maryam, who called him to renew her policy. He tells her about some new exciting features that has been included in their services. So he basically is promoting or pursuing a product development growth strategy.

3 0
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