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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:

Ruby should go to college.

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3 years ago
Suppose you are committed to owning a $215,000 ferrari. if you believe your mutual fund can achieve an annual return of 10.8 per
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Answer: I must invest <u>$85424.14</u> today in order to buy a Ferrari nine years from now on the day I turn 30.

We have

Price of the Ferrari nine years from now (Future Value - FV)    $215000

Expected Rate of return on the mutual fund (r)    10.8%

Time until I turn 30  (n)   9 years

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6 0
3 years ago
Calfee Corporation is a manufacturer that uses job-order costing. The company has supplied the following data for the just compl
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Answer:

$200,000

Explanation:

The computation of the ending balance in the work in process inventory account is shown below:

But before that determined the overhead rate per direct labor

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Divide by DLH estimated 35000  

OH rate per DLH    $17  

Now

Beginning Inventory of WIP   $19,000  

Current manufacturing cost    

material                  $420,000  

Labour                   $641,000  

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Total Manufacturing cost      $1,622,000  

Total cost of WIP       $1,641,000  

Less: Cost of goods manufactured $1,441,000  

Ending inventory of WIP        $200,000

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3 years ago
Olivia is working on budgeting her time between studying for school, working at a part-time job, and training for a triathlon. W
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Answer:

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