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valina [46]
2 years ago
12

The following transactions occurred during December 31, 2021, for the Microchip Company. On October 1, 2021, Microchip lent $115

,000 to another company. A note was signed with principal and 8% interest to be paid on September 30, 2022. On November 1, 2021, the company paid its landlord $5,400 representing rent for the months of November through January. Prepaid rent was debited. On August 1, 2021, collected $10,800 in advance rent from another company that is renting a portion of Microchip’s factory. The $10,800 represents one year’s rent and the entire amount was credited to deferred rent revenue. Depreciation on office equipment is $4,050 for the year. Vacation pay for the year that had been earned by employees but not paid to them or recorded is $7,550. The company records vacation pay as salaries expense. Microchip began the year with $1,850 in its asset account, supplies. During the year, $6,200 in supplies were purchased and debited to supplies. At year-end, supplies costing $3,100 remain on hand. Required: 1. & 2. If Microchip’s accountant employed reversing entries for accruals, prepare the adjusting entries at the end of 2021 for only those entries that would be reversed. 3. Prepare the appropriate reversing entries at the beginning of 2022.
Business
1 answer:
const2013 [10]2 years ago
3 0

Answer:

Reversing entries are given below

Explanation:

The accountant would reverse the adjusting entries of the accrual of salaries payable and the accruals of interest receivable.

December 31, 2021 (To record interest receivable)

                                                                        DEBIT               CREDIT

Interest receivable [$115,000*8%*3/12]         2300

Interest revenue                                                                          2300

December 31, 2021 (To record salaries payable)

                                         DEBIT            CREDIT

Salaries expense            7550

Salaries payable                                       7550

January 1, 2022  (To reverse the entry recorded on December 31, 2021)

                                             DEBIT           CREDIT

Interest revenue                   2300

Interest receivable                                      2300

January 1, 2022  (To reverse the entry recorded on December 31, 2021)

                                              DEBIT              CREDIT

Salaries payable                     7550

Salaries expense                                               7550

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Solution:

Given information:

The fixed operating costs are$430,000.

The variable costs per unit are $2.95.

The selling price of the product is $4.50.

Calculation of the break-even point:

The formula to calculate the break-even point is:  

Break-even point = Fixed costs / Selling price per unit -Variable costs per unit  

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                            = 430,000 / 1.55 = 277,419

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2 years ago
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3 years ago
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Percentage change between two periods:

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3 years ago
Suppose Lisa's utility function is 4XY, where X is the consumption of beer and Y is consumption of pizza. For this utility funct
Evgesh-ka [11]

Answer:

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Bundle 2: Beer = 3; Pizza = 4

Bundle 3: Beer = 4; Pizza = 3

Bundle 4: Beer = 12; Pizza = 1

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Given that;

Lisa utility function UF(X,Y) = 4XY

where;

X = beer

Y = Pizza

MU_X = 4Y

MU_Y = 4X

The utility level = 48

so, UF(X,Y) = 4XY

putting different values of X (i.e beer ) given to us in this equation, we can calculate the values of Y(i.e pizza) to fulfill the utility

So; when X (beer) = 2

48 = 4×2×Y

48 = 8Y

Y = 48/8

Y = 6

Thus, Bundle 1: Beer = 2; Pizza = 6

when X (beer) = 3

48 = 4×3×Y

48 = 12 Y

Y = 48/12

Y = 4

Thus; Bundle 2: Beer = 3; Pizza = 4

when X (beer) = 4

48 = 4×4×Y

48 = 16 Y

Y = 48/16

Y = 3

Thus; Bundle 3: Beer = 4; Pizza = 3

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48 = 4×12×Y

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Y = 48/48

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Total outstanding common stock

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Diluted earnings per share = $270,000/372,000

= $0.73

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