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Drupady [299]
3 years ago
12

brainly Stuart Manufacturing Company was started on January 1, year 1, when it acquired $89,000 cash by issuing common stock. St

uart immediately purchased office furniture and manufacturing equipment costing $32,000 and $40,000, respectively. The office furniture had an eight-year useful life and a zero salvage value. The manufacturing equipment had a $4,000 salvage value and an expected useful life of six years. The company paid $12,000 for salaries of administrative personnel and $21,000 for wages to production personnel. Finally, the company paid $26,000 for raw materials that were used to make inventory. All inventory was started and completed during the year. Stuart completed production on 10,000 units of product and sold 8,000 units at a price of $9 each in year 1. (Assume that all transactions are cash transactions and that product costs are computed in accordance with GAAP.) calculate assets
Business
1 answer:
HACTEHA [7]3 years ago
5 0

Answer:

Stuart Manufacturing Company

Assets = $107,200

Explanation:

a) Data and Calculations:

Cash Account

Common stock $89,000

Furniture            (32,000)

Equipment         (40,000)

Salaries               (12,000)

Wages                (21,000)

Raw materials   (26,000)

Sales                   72,000

Cash balance  $30,000

Inventory:

Cost = $26,000

Units produced = 10,000 units

Cost per unit = $2.60 ($26,000/10,000)

Cost of goods sold = 8,000 * $2.60 = $20,800

Ending inventory = 2,000 * $2.60 = $5,200

Sales Revenue = 8,000 * $9 = $72,000

Assets:

Cash                     $30,000

Ending inventory     5,200

Furniture               32,000

Equipment            40,000

Total                  $107,200

b) An asset is something that brings in future cash flows to the business entity.  It is made up of Cash and Cash Equivalents, Inventories, Property, Plant, Equipment, and other business investments.  Assets are funded from finance provided by creditors and the equity owners, and they generate economic values.

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you are considering starting a business to provide high quality bookkeeping services targeted to restaurants and other food serv
tiny-mole [99]

The potential for industry growth, whether it seems as though competition will only get stronger or weaker, and the company's competence in carrying out industry key success factors.

An organized subset of economic activity is the subject of this article. See Manufacturing and Industrial society for information on mass manufacturing and its implications. An industry is a division of an economy that creates a cluster of closely linked goods, services, or raw materials (for a list of additional uses, see Industry macroeconomics). One may cite the wood business or the insurance industry as examples.

Industry classifications often use a company's or group's major source of revenue when evaluating it to place it inside a certain industry. For instance, "statistical units" are categorized by the "economic activity in which they primarily participate" according to the International Standard Industrial Classification (ISIC), which is utilized directly or through derivations for the official statistics of the majority of countries worldwide.

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7 0
1 year ago
On January 1 of this year, Thomas Insurance Corporation issued bonds with a face value of $ 4,000,000 and a coupon rate of 9 per
e-lub [12.9K]

Bonds Payable amount reflected in balance sheet = $2192890

Face Value = $2000000

Coupon Rate = 10%

Maturity Period = 10 years

Number of compounding = 2

Interest = $2000000 * 10% * 6/12 = $100000

Period = 2 * 10 = 20

Maturity Value = Face Value = $2000000

Market Interest Rate semiannually = 0.085 / 2 = 0.0425

Market Value = Present Value of Future Cash Flows

= PV of Interest + PV of maturity value

= (Interest * PVAF (4.25%, 20)) + (Maturity Value * PVIF (4.25%, 20))

= (100000 * 13.29437) + (2000000 * 0.434989)

= $1329437 + $869978

= $2199415

Since market value is greater than face value, we can say that bonds are issued at a premium.

Premium = $2199415 - $2000000 = $199415

Journal Entry to record the issuance of bonds:

Cash a/c                                               Dr          $2199415

     To Bonds Payable a/c                                 $2000000                            

     To Premium on the issue of bonds            $199415

Bonds Payable amount is a liability account that carries the quantity owed to bondholders by way of the company. This account usually seems in the lengthy-term liabilities section of the stability sheet, on account that bonds usually mature in more than one year.

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6 0
2 years ago
On July 1, 2020, Whispering Co. pays $13,620 to Metlock Insurance Co. for a 3-year insurance policy. Both companies have fiscal
S_A_V [24]

Answer:

jul-01 Prepaid expenses   13.620  

jul-01      Cash                              13.620

     

dec-31 Insurance policy expense 2.270  

dec-31     Prepaid expenses    2.270

Explanation:

Paid 1-jul 13620    

     

Three Years 13.620 36 months    

Monthly 378 month    

Current Year 2.270 6 months    

           

jul-01 Prepaid expenses   13.620  

jul-01      Cash                              13.620

     

dec-31 Insurance policy expense 2.270  

dec-31     Prepaid expenses    2.270

4 0
3 years ago
Suppose some banks decide to increase their holdings of excess reserves relative to deposits. Ceteris paribus, this action will
slava [35]

The action of the bank will put decreased pressure on the money supply, and to reduce the impact of this action, the Fed could decrease the discount rate.

Basically, a decrease in discount rate will make it easy and cheaper for commercial banks to borrow money from Federal Reserve System and thus, results to increase in available credit and lending in the economy

Therefore, if the commercial banks decide to increase their holdings of excess reserves supposed to be remitted to Feds, then, this will put <u>decreased</u> pressure on the money supply, and the Fed would act by <u>decreasing</u> the discount rate.

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5 0
2 years ago
The W. J. Clinton Company issued 750 shares of $1 stated value common stock in exchange for land from the Whitewater Investment
MrMuchimi

Explanation:

The journal entry is as follows:

Land  Dr $70,000

Additional paid in capital  $5,000

             To Common stock $75,000

(Being the common stock is issued in exchanged for cash)

The computation of the additional paid in capital is shown below:

= Common stock - the appraised value of land

where,

The common stock = 750 shares × $100 = $75,000

And, the  appraised value of land is $70,000

So, the remaining balance is

= $75,000 - $70,000

= $5,000

The $5,000 would be recorded as an additional paid in capital

4 0
3 years ago
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