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Step2247 [10]
3 years ago
8

Bedrock Company reported a December 31 ending inventory balance of $414,000. The following additional information is also availa

ble: The ending inventory balance of $414,000 included $72,400 of consigned inventory for which Bedrock was the consignor. The ending inventory balance of $414,000 included $22,800 of office supplies that were stored in the warehouse and were to be used by the company's supervisors and managers during the coming year. Based on this information, the correct balance for ending inventory on December 31 is: Multiple Choice a.$362,800 b.$247,000 c.$342,200 d.$391,200
Business
1 answer:
Paha777 [63]3 years ago
3 0

Answer:

The corrected balance of ending inventory is $391200 and option d is the correct answer.

Explanation:

The amount of goods sent on consignment by Bedrock of $72400 are already included in the inventory value. These goods belong to Bedrock, the consignor, until they are sold off by the consignee. Thus, no adjustment is needed for this amount.

The ending inventory balance only needs one adjustment that is for office supplies. The office supplies are office consumables and a separate asset than the inventory of the business which is solely for the purpose of selling operations. Thus, the office supplies amount will be deducted from the inventory value.

The correct balance = 414000 - 22800 = $391200

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Suppose the Fed carries out an open market sale of $100m and simultaneously decreases the minimum required reserve ratio from 10
andrey2020 [161]

Answer:

loanable amount after Fed operation = $950 M

Securities after fed operation = $50 M

attached below is the T-account table

Explanation:

Given data:

For assets : securities = $100 M ,  Loans = $800 M

For Liabilities :  Constant demand deposit = $1000 M

difference between the assets and liability = $100 M  and this makes the Banking system unbalanced hence the Banking system needs the intervention of the Fed. and the reduction in the required reserve ratio from 10% to 5% is the right action

How with the reserve ratio reduced to: 0.05

hence required  Minimum required securities after operation = 0.05 * 1000 M = 50 M

Note : Total demand deposits = securities + loanable amount

therefore loanable amount after Fed operation = $1000 M - $50 M = $950

Attached below is the T-table

When both tables are compared it can be seen that there is a significant increase  in the loanable amount after the Fed's operations and increase in Loanable amount transcends to increase in Monetary base

5 0
3 years ago
Bad Debts account has a credit balance of $8,000 before the adjusting entry for bad debts expense. After analyzing the accounts
White raven [17]

Answer:

$14,300

Explanation:

Based on the information given we were told that the​ management of the company estimated that the amount in the uncollectible accounts will be the amount of $14,300 which means that the amount of $14,300 will be the balance of the Allowance for Bad Debts that should be reported on the company balance​ sheet.

5 0
3 years ago
The stockholders' equity section of the balance sheet for Potawatomi Corporation appeared as follows before its recent stock div
adell [148]

Answer:

Common stock = $110,000

Additional paid-in capital  = $130,000

Retained earnings = $170,000

Explanation:

Computation of the given data are as follows:

Common stock after issuing stock dividend = $100,000 + ( 10,000 ×10% × $10)

= $100,000 + 10,000 = $110,000

Additional paid-in capital after issuing stock dividend = 120,000 +  ( 10,000 ×10% × $10)

= 120,000 + 10,000 = $130,000

Retained earnings after issuing stock dividend = 150,000 +  ( 10,000 ×10% × $20)

= 150,000 + 20,000 = $170,000

7 0
3 years ago
Assume that you are a loan officer of a bank. A local church is seeking a $4 million, 20-year loan to construct a new classroom b
n200080 [17]

Answer:

Explanation:

a.

There is little information on how funds are used or how much money is spent to manage the church. The financial statements have been prepared incorrectly.

Interpretation:

While drafting the financial accounts, the church committed many errors. The church's revenue is equivalent to its daily operations operating expenditures. They have approximately $3 million in funding assets that they do not owe any money on.  

It may be deduced that the church is attempting to preserve asymmetric information, and therefore it will be better to justify its sources of income and use of money in order to determine whether they can or they cannot pay the debt.

b.

The revenue from various channels must be detailed in the yearly report so that the loan officer may make an informed judgment.

Interpretation:

Since payments and contributions account for 90% of revenue and revenue from other sources accounts for 10%, it's surprising how the church earns money in other ways as stated on the income statement. As a result, it's important to understand what other potential revenue streams the church has before approving the loan.

c.

The officer in charge of the loan should check the church's book records to make sure and guarantee that there are no outstanding loans. This situation necessitates a thorough examination and assessment.

Interpretation:

The church has $3 million worth of equipment. The church's expenses, on the other hand, are equivalent to the church's income. As a result, it's unclear how the church acquired the equipment without taking out a loan. As a result, the church must be urged to produce a full breakdown of its expenses, which may be thoroughly and fully studied to see whether there are any financing charges that the church is attempting to hide in its yearly reports.

d.

There is no direct or primary source of income for the church. It solely makes money from charity donations.

Interpretation:

The church's only sources of income are fundraisers and charitable donations. It also doesn't possess any significant revenue streams. Because the church is attempting to conceal numerous possible pieces of information, this may be a case of micro-management by the proprietors, and so these issues should be considered by the officer in charge of the loan before accepting the loan.

8 0
3 years ago
Lakeside Inc. produces a product that currently sells for $64.80 per unit. Current production costs per unit include direct mate
iren [92.7K]

Answer:

a. Incremental costs = (Direct materials + Direct labor) * 20%

Incremental costs = ($26 + $28) * 20%

Incremental costs = $54 * 20%

Incremental costs = $10.8

Incremental selling price = $72 - $64.8 = $7.2

Incremental profit (loss) = Incremental selling price - Incremental costs = $7.2 - $10.8 = $(3.6)

b. No. As there is Incremental loss, it should not be processed further

5 0
2 years ago
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