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arlik [135]
2 years ago
5

Alpaca Corporation had revenues of $300,000 in its first year of operations. The company has not collected on $20,000 of its sal

es and still owes $25,200 on $75,000 of merchandise it purchased. The company had no inventory on hand at the end of the year. The company paid $14,000 in salaries. Owners invested $23,000 in the business and $23,000 was borrowed on a five-year note. The company paid $3,000 in interest that was the amount owed for the year, and paid $6,800 for a two-year insurance policy on the first day of business. Alpaca has an effective income tax rate of 9%.
Compute net income for the first year for Alpaca Corporation:
a) $ 183,092
b) $ 186,186
c) $ 225,000
d) $ 204,600
Business
1 answer:
madam [21]2 years ago
6 0

Answer: Option (b) is correct.

Explanation:

Given that,

Revenues = $300,000

Merchandise it purchased = $75,000

Salaries paid = $14,000

Owners invested = $23,000

Borrowed on a five-year note = $23,000

Interest paid = $3,000

Paid for a two-year insurance policy = $6,800

Income tax rate = 9%

Gross Margin = Revenues - Cost of Goods Sold

                       = $300,000 - $75,000

                       = $225,000

Profit before tax = Gross Margin - Salaries - Insurance payment - Interest

                          = $225,000 - 14,000 - 3,400 - 3,000

                          = $204,600

Net Income = Profit before tax - Tax at 9%

                    = $204,600 - 18,414

                    = $186,186

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olya-2409 [2.1K]

Answer:

Alpha Company:

  • inventory turnover ratio = 3.62
  • days in inventory = 101 days

Omega Company

  • inventory turnover ratio = 4.13
  • days in inventory = 89 days

Explanation:

                                         Alpha Company       Omega Company

Beginning inventory                $49,500                       $71,000

<u>Cost of goods purchased     $200,000                   $299,000 </u>

Cost of goods available

for sale                                   $249,500                    $370,000

<u>Ending inventory                     $57,000                      $73,000 </u>

Cost of goods sold                 $192,500                   $297,000

inventory turnover rate = cost of goods sold / the average inventory

average inventory = (beginning inventory + ending inventory) / 2

days in inventory = 365 days / inventory turnover ratio

                                          Alpha Company             Omega Company

average inventory                  $53,250                         $72,000

inventory turnover         $192,500 / $53,250      $297,000 / $72,000

                                           = 3.62                              = 4.13

days in inventory             365 / 3.62                        365 / 4.13

                                        = 100.83 ≈ 101 days          = 88.38 ≈ 89 days

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2 years ago
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Explanation:

6 0
2 years ago
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Monica [59]

Answer:

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Explanation:

Actual Quantity = 243,000 lbs

Standard Quantity:

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= 40,000 units × 6 lbs

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4 0
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Explanation:

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Answer:

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