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3 years ago

Identify which accounting principle or assumption best describes each of the following

Business

1 answer:

ehidna [41]3 years ago

7 0

Answer:

A) Accrual principle

B) Cost principle

C) Economic entity principle

Explanation:

Accrual principle: indicates that accounting transactions should be recorded in the accounting periods when they actually occur, rather than in the periods when there are cash flows associated with them.

Cost principle: according to this concept, a business should only record its assets, liabilities, and equity investments at their original purchase costs.

Economic entity principle: implies that the transactions of a business should be kept separate from those of its owners and other businesses.

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Work-in-process that is being transferred into a department is debited to that work-in-process account, while work-in-process th

oksian1 [2.3K]

Answer:

True

Explanation:

Work in process refers to those goods which require further processing. When a department transfers work in process(WIP) to another department, the recipient department's stock of WIP is debited i.e debit the receiver principle.

Similarly work in process that is being transferred out of a department would be recorded like Purchase return i.e credit what goes out.

A debit in WIP account increases it's balance whereas a credit in WIP account reduces it's balance.

4 0

4 years ago

The monumental failure of Jack Welch, the legendary leader of GE (General Electric), is that he was great transactional leader b

sammy [17]

Answer:

False

Explanation:

6 0

3 years ago

Read 2 more answers

Cougar Corp (December 31st fiscal year end) purchased a piece of machinery, which it will use to produce inventory, on August 1s

Zanzabum

Answer:

accumulated depreciation = 241667

depreciation for 2016 = 6800

book value as December 2017 = 240000

Explanation:

solution

we know SLM depreciation per month is express as

depreciation = $\frac{cost -salvage value}{useful life}$

put here value

depreciation = $\frac{450000-50000}{4}$

depreciation = 100000

and

accumulated depreciation as of 31st December is

accumulated depreciation = $\frac{100000*(5+12+12)}{12}$

accumulated depreciation = 241667

and

depreciation per hour is

depreciation = $\frac{cost -salvage value}{estimated hours}$

depreciation = $\frac{450000-50000}{50000}$

depreciation per hour = 8

so depreciation for 2016 = 8500 × 8 = 6800

and

as depreciation by sum of year of digit method

depreciation = $\frac{(cost -salvage value)*useful life}{sum of year digit}$

so here sum of years digit = 1 + 2 + 3 + 4 = 10

so 1st year depreciation = $\frac{(450000-50000)*4}{10}$ = 160000

and next year depreciation = $\frac{(450000-50000)*3}{10}$ = 120000

so depreciation from august 2016 to july 2017 = 160000

and depreciation from august 2017 to December 2017 = $\frac{120000*5}{12}$ = 50000

so book value as December 2017 = 450000 - 160000 - 50000

book value as December 2017 = 240000

4 0

3 years ago

Now consider the case in which the manufacturer offers a marginal unit quantity discount for the plywood. The first 20,000 squar

Sindrei [870]

Answer:

Explanation:

We can use the following method to solve the given problem

We are given following

Annual demand,

D = 20000*12

D = 240,000 sqft

Fixed order cost, is given as

S = $ 400

Considering the unit cost, is given as

C = $ 1

Holding cost, H = 1*20% = $ 0.2

EOQ = sqrt(2DS/H)

= √(2*240000*400/0.2)

= 30,984 sq ft

This is higher than 20,000 and less than 40,000 sq ft. For this reason, the applicable price for this quantity is $ 0.98

For C = $ 0.98, holding cost, H = 0.98*20% = $ 0.196

Revised EOQ = sqrt(2*240000*400/0.196) = 31,298 sq ft

Total annual cost of EOQ policy = D*C + H*Q/2 + S*D/Q

= 240000*0.98 + 0.196*31298/2 + 400*240000/31298

= $ 241,334.5

Now consider the next level of price, C = $ 0.96

Holding cost, H = 0.96*20% = $ 0.192

EOQ = sqrt(2*240000*400/0.192)

= 31633 sqft

This amount is will not be feasible for this price, because it requires a minimum order of 40000 sqft.

Therefore, Q = 40,000

Total annual cost = 240000*0.96 + 0.192*40000/2 + 400*240000/40000

Total annual cost = $ 236,640

Total annual cost is lowest for order quantity of 40,000 sq ft.

1) Optimal lot size = 40,000 sq ft.

2) the annual cost of this policy

= $ 236,640

3) the cycle inventory of plywood at Prefab = Q/2 = 40000/2

At prefeb= 20,000 sq ft

4) let's assume the manufacturer sells all plywood at $ 0.96, then

Holding cost, H = 0.96*20%

H= $ 0.192

EOQ = sqrt(2*240000*400/0.192)

EOQ = 31633 sqft

Total annual cost = 240000*0.96 + 0.192*31633/2 + 400*240000/31633

Total annual cost = $ 236,471.6

Difference in total annual cost = 236640 - 236471.6 = $ 168.4

4 0

3 years ago

You are considering purchasing a new truck that will cost you $34,000. The dealer offers you 1.9% APR within monthly compounding

dmitriy555 [2]

Answer: $31,513.65

my monthly payment (principal) would be closest to $31,514

Explanation:

Using compound interest formula below to find the principal

A = p (1 + r/n)^nt

A= amount = $34,000

r = annual nominal rate = 1.9% = 0.019

n = number of compounding ; monthly compounding means 12 interest payments in a year

P= principal

t= time in years 48months = 48/12years = 4years

34,000 = p (1 + 0.019/12)^12(4)

34,000 = p (1 + 0.00158333333)^48

34,000 = p ( 1.00158333333)^48

34,000 = 1.07889755p

Divide both sides by 1.07889755

P = $31,513.6502

≈$31,514 to nearest whole number.

5 0

4 years ago