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AleksandrR [38]
3 years ago
6

At the beginning of 20x1, Sun Angel Corporation began offering a two-year warranty on its products. The warranty program was exp

ected to cost Sun Angel 1% of net sales in the first 12 months and 3% of net sales in the second 12-month period. Net sales made under warranty in 20x1 were $180 million. Fifteen percent of the units sold were returned in 20x1 and repaired or replaced at a cost of $5.3 million. The amount reported on Sun Angel's 20x1 year end balance sheet for Est. Warranty Liability is: Group of answer choices
Business
1 answer:
Anettt [7]3 years ago
6 0

Answer:

The correct answer is 1,900,000 dollars.

Explanation:

This question requires us to calculate the amount that the Sun angel will recognize as warrantly liability in it balance sheet for the year ended at 20x1.

The sales made during the year is 180 millions dollars. So the company will recognize the provision as follow (during the year)

(180M * 4%= 7.2M)

Debit Warrantly Expense    $7.2M

Credit Liability                      $7.2M

Claim entertain during the year that has reduce the above recognize liabilty is

Debit Liabilty                    $5.3M

Credit Cash                      $5.3M

Liability to be reported = $7.2M - $5.3M = 1,900,000 dollars

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A firm's bonds have a maturity of 10 years with a $1,000 face value, a 9 percent semiannual coupon, are callable in 5 years at $
Sladkaya [172]

Answer:

Yield to maturity is 3.94%

Explanation:

Yield to maturity is the annual rate of return that an investor receives if a bond bond is held until the maturity.

Face value = F = $1,000

Coupon payment = $1,000 x 9% = $90/2  = $45 semiannually

Selling price = P = $1080

Number of payment = n = 10 years x 2 = 20

Yield to maturity = [ C + ( F - P ) / n ] / [ (F + P ) / 2 ]

Yield to maturity = [ $45 + ( 1000 - 1080 ) / 20 ] / [ (1,000 + 1080 ) / 2 ]

Yield to maturity = [ $45 - 4 ] / 1040 = $41 /1040 = 0.394 = 3.94%

4 0
3 years ago
On January 1, 2019, Pepin Company adopts a compensatory share option plan for its 50 executives. The plan allows each executive
bazaltina [42]

Answer:

On 31 December 2019: Debit Compensation expense for $39,667; and Credit Paid-in capital from share options for $39,667.

On 31 December 2020: Debit Compensation expense for $39,667; and Credit Paid-in capital from share options for $39,667.

On 31 December 2021: Debit Compensation expense for $41,067; and Credit Paid-in capital from share options for $41,067.

On 06 January 2022: Debit Cash for $48,000; Debit Paid-in capital from share options for $22,400; Credit Common stock for $3,200; and Credit Paid in capital in excess of par- common stock (balancing figure) for $67,200.

Explanation:

Note: See part b of the the attached excel file for the journal entries

Also note that before the journal entries are recorded, the current compensation expense for year 2019, 2020 and 2021 are first calculated. See part a of the attached excel file for the calculation of the the current compensation expense for year 2019, 2020 and 2021.

In part a of the attached excel file, the estimated compensation cost for 2019, 2020 and 2021 are calculated as follows:

Estimated compensation cost for 2019 = Option value on the grant date * Number of executives * (1 - Expected option forfeited rate) * Number of shares in the option = $14 * 50 * (1 - 15%) * 200 = $119,000

Estimated compensation cost for 2020 = Option value on the grant date * Number of executives * (1 - Expected option forfeited rate) * Number of shares in the option = $14 * 50 * (1 - 15%) * 200 = $119,000

Estimated compensation cost for 2021 = Option value on the grant date * (Number of executives - Actual executives turnover for the entire service period) * Number of shares in the option = $14 * (50 - 7) * 200 = $120,400

On 06 January 2022, the calculation of the entries used in the part b of the attached excel file are as follows:

w.1. Cash = Number of executives who exercise their options * Number of shares in the option * Purchase price per share after completing a 3-year service period = (8 * 200 * $30) = $48,000  

w.2. Paid-in capital from share options = Number of executives who exercise their options * Number of shares in the option * Option value on the grant date = (8 * 200 * 14) = $22,400

w.3. Common Stock = Number of executives who exercise their options * Number of shares in the option * Sahre par value = (8 * 200 * $2) = $3,200

w.4. Paid in capital in excess of par- common stock (balancing figure)  = Cash + Paid-in capital from share options - Common Stock = $48,000 + $22,400 - $3,200 = $67,200

Download xlsx
6 0
3 years ago
"Americans in this decade are less likely than in the prior decade to say they want to lose weight, with the average dropping fr
Scilla [17]

Answer a. Estimate a population proportion.

Explanation:

A population proportion denotes a specific attribute of a population measured in percentage, the above analysis is on losing weight by the populace.

A mean only refers to the average of the population without reference to a particular quality.

The analysis is not testing a claim but it's only making reference to earlier findings on the population. A claim would have given us a specific quality which the population has been predicted or established to adhere to.

4 0
3 years ago
Studying business ethics will not necessarily
Serga [27]

Business ethics will never tell you exactly what to do in all decisions. The study of business ethics is designed to help you understand the importance of your decisions, inform you of impacts, describe the ethical decision-making process, and help you recognize ethical issues, but it will not tell you what to do. It will simply give you the tools necessary to make a decision.

7 0
3 years ago
On March 3, Cobra Inc. purchased a desk for $330 on account. On March 22, Cobra purchased another desk for $460 also on account,
Olin [163]

Answer:

Cobra Inc.

The amount that Cobra should report for desks is $790.

Explanation:

a) Data and Calculations:

Purchases on March 3 =    $330

Purchases on March 22 = $460

Payment on March 24 =   ($460)

Amount unpaid =               $330

b) The amount that Cobra Inc. should report as Accounts Payable at the end of March is $330.  However, in reporting for the desks, it should report $790 in assets.  This amount represents the value of desks that the company is possessing, which is financed by company cash and creditors.

4 0
3 years ago
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