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Doss [256]
3 years ago
14

On November​ 1, 2018, Arch Services issued $ 305 comma 000 of eightminusyear bonds with a stated rate of 11​% at par. Interest p

ayments occur each April 30 and October 31. On December​ 31, 2018, Arch made an adjusting entry to accrue interest at yearminusend. What is the amount of Interest Expense that will be recorded on December​ 31, 2018?​ (Do not round any intermediate​ calculations, and round your final answer to the nearest​ dollar.)
Business
1 answer:
Jobisdone [24]3 years ago
7 0

Answer:

$5,603

Explanation:

The calculation of Interest Expense is shown below:-

Interest made accrued on Dec 31, 2018 = Services issued × Stated rate × Remaining months ÷ Number of Months in a year

= $305,000 × 11% × 2 ÷ 12

= $305,000 × 11% × 0.167

= $5,603

Therefore for computing the Interest Expense we simply applied the above formula.

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What happens if the amount of Bad Debt Expense is overstated at year end? A : Net income will be overstated. B : Allowance for D
Yuri [45]

Answer:

D. Net Accounts Receivable will be understated

Explanation:

5 0
3 years ago
The management at Climate Action Development needs to recruit campaign managers for its Renewable Energy Project. They are looki
Rzqust [24]

Answer: (E) Personality

Explanation:

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It is also known as the personality psychology for evaluating the characteristics of the person for recruiting the right candidate for the specific profile by testing the individual person personality factor.  

 Therefore, Option (E) is correct.  

5 0
3 years ago
Cahalane Corporation has provided the following data for its two most recent years of operation: Selling price per unit $ 91 Man
ankoles [38]

Answer:

A. The amount of fixed overhead deferred in inventories is $60,000

Explanation:

Unit product cost      

                                            Year 1      Year 2  

Direct materials                      $12         $12

Direct labor                              $5        $5  

Variable manufacturing

overhead                                     $5      $5  

Fixed overhead

                                                   $48      $36  

                           ($432,000 ÷ 9,000)   ($432,000 ÷ 12,000)

unit product cost                       $70      $58

Fixed overhead deferred (1,000 × $48)   $48,000  

Fixed overhead released                                             -$48000  

Fixed overhead deferred (3000 × $36)                        $108,000  

Net                                                             $48,000        $60,000

The amount of fixed overhead deferred in inventories is $60,000

8 0
3 years ago
Gentle Ben's Bar and Restaurant uses 6,700 quart bottles of an imported wine each year. The effervescent wine costs $4 per bottl
Marat540 [252]

Answer:

a. The answer is:762 bottlé.

b. The answer is: 487 bottles.

Explanation:

a. The economic order quantity is calculated as: \sqrt{(2xDxS/H)} = \sqrt{2 x 6968 x 25)/0.6 = 762 units because: D = annual demand = Weekly demand x week opening per year = 134 x 52 = 6968; S = Cost per order = 25; H = Holding cost per unit = 15% x purchase price = 15% x 4 = 0.6

b. Inventory level to place order:

With the inventory system providing a 95 percent service probability, z level is 1.64 (using the NORM.S.INV function in excel).

So Inventory level to place order = 134 * 3 + 1.64 * 30 * 3^0.5= 487 bottles.

7 0
3 years ago
On January 1, 2021, the general ledger of TNT Fireworks includes the following account balances:
ivolga24 [154]

Answer:

TNT Fireworks

1. Adjusting Entries on January 31:

Accounts                              Debit         Credit

a. Depreciation Expense     $375

Accumulated Depreciation                $375

b. Uncollectible Expense   $5,620

Allowance for Uncollectible Accounts $5,620

c. Accrued interest revenue $120

Interest Revenue                                 $120

d. Salaries Expense           $34,000

Salaries payable                                 $34,000

e. Income Tax Expense     $10,400

Income tax payable                            $10,400

2. Adjusted Trial Balance as of January 31, 2021:

Accounts                              Debit         Credit

Cash                                   $ 2,600

Accounts Receivable       238,400

Allowance for Uncollectible Accounts $9,220

Inventory                            12,600

Notes Receivable

(5%, due in 2 years)        28,800

Land                                169,000

Equipment                       20,900

Accumulated Depreciation                      375

Depreciation Expense         375

Salaries Expense           65,200

Utilities Expense             17,900

Income Tax Expense     10,400

Uncollectible Expense   5,620

Accounts Payable                             102,200

Salaries Payable                                34,000

Income Taxes Payable                      10,400

Common Stock                              234,000

Retained Earnings                           69,600

Sales Revenue                              234,000

Interest Revenue                                  120

Accrued Interest

Receivable                      120

Cost of Goods Sold 122,000

Total                      $693,925  $693,915

3. Multi-step Income Statement for the period ended January 31, 2021:

Sales Revenue                              234,000

Cost of goods sold                        122,000

Gross profit                                  $112,000

Interest Revenue                                 120

Total revenue                              $112,120

Depreciation Expense         375

Salaries Expense           65,200

Utilities Expense             17,900

Uncollectible Expense   5,620  $89,095

Income before tax                      $23,025

Income Tax Expense                    10,400

Net Income                                 $12,625

Retained Earnings, January 1     69,600

Retained Earnings, January 31 $82,225

4. Classified Balance Sheet as of January 31, 2021:

Assets:

Cash                                                   $ 2,600

Accounts Receivable       238,400

Uncollectible Accounts       9,220   229,180

Accrued Interest Receivable                   120

Inventory                                             12,600

Current assets                              $244,500

Notes Receivable

(5%, due in 2 years)         28,800

Land                                  169,000

Equipment            20,900

Accumulated Dep.     375 20,525  218,325

Total assets                                  $462,825

Liabilities:

Accounts Payable           102,200

Salaries Payable               34,000

Income Taxes Payable     10,400 $146,600

Equity:

Common Stock             234,000

Retained Earnings          82,225  $316,225

Total liabilities and Equity           $462,825

5. Closing Journal Entries:

Accounts                              Debit         Credit

Income Summary             $221,495

Depreciation Expense                                  375

Salaries Expense                                    65,200

Utilities Expense                                      17,900

Income Tax Expense                              10,400

Uncollectible Expense                             5,620

Cost of Goods Sold                             122,000

To close temporary accounts to the income summary.

Sales Revenue                 234,000

Interest Revenue                     120

Income Summary                              $234,120

To close temporary accounts to the income summary.

Cash                                   $ 2,600

Accounts Receivable       238,400

Inventory                             12,600

Notes Receivable

(5%, due in 2 years)         28,800

Accrued Interest

Receivable                             120

Land                                169,000

Equipment                       20,900

Allowance for Uncollectible Accounts $9,220

Accumulated Depreciation                        375

Accounts Payable                               102,200

Salaries Payable                                   34,000

Income Taxes Payable                         10,400

Common Stock                                 234,000

Retained Earnings                              82,225

To close permanent accounts to the balance sheet.

Explanation:

a) Data and Calculations:

Accounts                              Debit         Credit

Cash                                 $ 60,100

Accounts Receivable         27,800

Allowance for

 Uncollectible Accounts                       $ 3,600

Inventory                            37,700

Notes Receivable

 (5%, due in 2 years)        28,800

Land                                 169,000

Accounts Payable                                  16,200

Common Stock                                   234,000

Retained Earnings                                69,600

Totals                          $ 323,400   $ 323,400

See workings attached.

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8 0
3 years ago
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