George is offered an investment opportunity by his friend Ray. He asks George for $6,900 and offers to repay him $12,990 after a
1 answer:
Answer:
Depositing in bank is a better option.
Explanation:
For this solution, we can either determine the interest rate given to George by his one of the friend or the future worth method,
Future worth method is used here,
Given that,
PV = $6,900
R = 9%
N = 10 Years
FV = 6,900 × 2.3673
FV = $16,334.81
Since, the future worth of investing in bank is more than the money to be offered by the George's friend (16,334.81 > 12,900) and hence, depositing in bank is a better option.
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Answer:
Direct labor rate variance = (SR - AR) AH
October = ($15 - $15.20) 16,250 = - $3,250 Unfavorable
November = ($15 - $15.25) 22,000 = - $5,500 Unfavorable
Direct Labor Efficiency Variance = (SH - AH) SR
October = (16,800 - 16,250) $15 = 8,250 Favorable
November = (18,000 - 22,000) $15 = - $60,000 Unfavorable
Direct Labor Cost Variance = Standard Cost - Actual Cost
October = $252,000 - $247,000 = $5,000 Favorable
November = $270,000 - $335,500 = - $65,500 Unfavorable
Explanation:
Computing variances for each month
Particulars October November Equation
Total units produced 5,600 units 6,000 units (a)
Standard hour per unit 3 hours 3 hours (b)
Total standard hour SH 16,800 18,000 (c) = (a)*(b)
Total standard cost
of labor @ $15 SR per hour $252,000 $270,000 (d) = (c) * 15
Actual hours used AH 16,250 22,000 (e)
Actual cost $247,000 $335,500 (f)
Actual Rate per hour AR $15.20 $15.25 (g) = (f)/(e)
Using the above information we have
Direct labor rate variance = (SR - AR) AH
October = ($15 - $15.20) 16,250 = - $3,250 Unfavorable
November = ($15 - $15.25) 22,000 = - $5,500 Unfavorable
Direct Labor Efficiency Variance = (SH - AH) SR
October = (16,800 - 16,250) $15 = 8,250 Favorable
November = (18,000 - 22,000) $15 = - $60,000 Unfavorable
Direct Labor Cost Variance = Standard Cost - Actual Cost
October = $252,000 - $247,000 = $5,000 Favorable
November = $270,000 - $335,500 = - $65,500 Unfavorable
Complete Question:
PB10-2 Recording and Reporting Current Liabilities with Evaluation of Effects on the Debt-to-Assets Ratio [LO 10-2, LO 10-5]
Tiger Company completed the following transactions. The annual accounting period ends December 31.
Jan. 3 Purchased merchandise on account at a cost of $24,000. (Assume a perpetual inventory system.) Jan.
27 Paid for the January 3 purchase.
Apr. 1 Received $80,000 from Atlantic Bank after signing a 12-month, 5 percent promissory note.
June 13 Purchased merchandise on account at a cost of $8,000.
July 25 Paid for the June 13 purchase.
July 31 Rented out a small office in a building owned by Tiger Company and collected eight months’ rent in advance amounting to $8,000.
Dec. 31 Determined wages of $12,000 were earned but not yet paid on December 31 (Ignore payroll taxes).
Dec. 31 Adjusted the accounts at year-end, relating to interest.
Dec. 31 Adjusted the accounts at year-end, relating to rent.
Required:
1. & 2. Prepare journal entries for each of the transactions through August 1 and any adjusting entries required on December 31.
3. Show how all of the liabilities arising from these items are reported on the balance sheet at December 31.
Answer:
Prepared journal Entries for Questions 1, 2 and 3 are attached as images in this order
1 Journal Entry Worksheet 1 (image 1)
2 Journal Entry Worksheet 1 (image 2)
3 Journal Entry Balance sheet 1 (image 3)
