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gtnhenbr [62]
2 years ago
10

During its first year of operations, Mack's Plumbing Supply Co. had sales of $3,250,000, wrote off $27,800 of accounts as uncoll

ectible using the direct write-off method, and reported net income of $487,500. Determine what the net income would have been if the allowance method had been used, and the company estimated that 1% of sales would be uncollectible.
Business
1 answer:
ArbitrLikvidat [17]2 years ago
3 0

Answer:

482.500

Explanation:

With the direct write-off method all accounts when detected as uncollectible, the amount of the client's debt is charged to the expense, while an estimate is made with the allowance method (this method is the most accepted accounting)

The direction of these methods in this case is translated in this way

allowance method 3,250,000 X 1% = 32,500.

Direct writte off 27,800

The difference between these values, which is 4,700, corresponds to a higher forecast, therefore, to a higher expense for the year, so that the net result will be reduced

Net result 487,500 minus 4,700 = 482,800

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Knox Company has a new product with a projected selling price of $6.00 each. It estimates that it could sell 100,000 units annua
Pachacha [2.7K]

Answer:

350,000

And if done per unit, $3.50

Explanation:

Both sales and variable cost are dependent on the number of units sold.

The sales less the variable cost gives the contribution margin. The contribution margin less the fixed cost gives the net operating income.

The target cost of the product is the difference between the selling price and the anticipated profit.

Target cost per unit

= $6.00 - $2.50

= $3.50

Total Target cost = $3.50 * 100,000

= $350,000

6 0
3 years ago
Which of the following is true regarding the Statement of Revenues, Expenses, and Changes in Net Position for a public college c
blsea [12.9K]

Answer:

All of these options is true

Explanation:

Statement of revenue and expenses is a comprehensive report showing the amount of profit earned minus the amount of operating expenses.

It provides information regarding the organization's operation as well as the revenue generated.

Revenue earned is collated as receipts and included in the statement of revenue and expenses.

Regarding the Statement of Revenues, Expenses, and Changes in Net Position for a public college choosing to report as a special-purpose entity engaged in business-type activities, the following apply:

  • State appropriations should be reported as non-operating income
  • Both contributions for plant and for endowment purposes must be reported separately after both operating and non-operating revenues and expenses
  • An operating income figure must be displayed
4 0
2 years ago
If taxes are levied specifically for payment of interest and principal on long-term debt, those taxes are:
lys-0071 [83]

Answer:

Recognized as revenues in the debt service fund.

Explanation:

Debt Service fund is a term that is used to describes a form of cash reserve utilized in the payment of interest and principal on specific kinds of debt for a given period. For example, bond premiums are commonly imposed by state law to be moved to debt service funds.

Hence, If taxes are levied specifically for payment of interest and principal on long-term debt, those taxes are: Recognized as revenues in the debt service fund.

8 0
3 years ago
A company makes tools, such as hammer and tape measures. One of their primary raw materials is steel and if they run out of stee
Sedbober [7]

Answer:

D. continuous review system

Explanation:

In the context of manufacturing it seems that the system being described would be a continuous review system. Like mentioned in the question this is a system that automatically adjusts the stock level in real time when a product moves in or out of stock, and automatically triggers an order for more stock as soon as the stock level hits a low quantity point is hit.

3 0
3 years ago
A baking company has different product ranges like whole-wheat pizzas for the diet-conscious and rich cookies for children and y
Sidana [21]

Answer:

D. market segments

Explanation:

4 0
2 years ago
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