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Reil [10]
3 years ago
12

Metlock Windows manufactures and sells custom storm windows for three-season porches. Metlock also provides installation service

for the windows. The installation process does not involve changes in the windows, so this service can be performed by other vendors. Metlock enters into the following contract on July 1, 2020, with a local homeowner. The customer purchases windows for a price of $2,280 and chooses Metlock to do the installation. Metlock charges the same price for the windows irrespective of whether it does the installation or not. The installation service is estimated to have a standalone selling price of $630. The customer pays Metlock $1,980 (which equals the standalone selling price of the windows, which have a cost of $1,140) upon delivery and the remaining balance upon installation of the windows. The windows are delivered on September 1, 2020, Metlock completes installation on October 15, 2020, and the customer pays the balance due.
Required:
Prepare the journal entries for Geraths in 2020.
Business
1 answer:
Xelga [282]3 years ago
6 0

Answer:

June 1 2020

No entry

September 1, 2020

Dr Cash $1,980

Dr Accounts receivable $300

Cr Sales revenue $1,730

Cr Unearned sales revenue $550

September 1, 2020

Dr Cost of goods sold $1,140

Cr Inventory $1,140

October 15 2020

Dr Cash $300

Dr Unearned service revenue $550

Cr Accounts receivable $300

Cr Service Revenue $550

Explanation:

Preparation of the journal entries for Geraths in 2020

June 1 2020

No entry

September 1, 2020

Dr Cash $1,980

Dr Accounts receivable $300

($1,730+$550+$1,980)

Cr Sales revenue $1,730

($1,980/$2,610*$2,280)

($1,980+$630=$2,610)

Cr Unearned sales revenue $550 ($630/$2,610*$2,280)

September 1, 2020

Dr Cost of goods sold $1,140

Cr Inventory $1,140

October 15 2020

Dr Cash $300

Dr Unearned service revenue $550

Cr Accounts receivable $300

Cr Service Revenue $550

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When receiving food, you can refuse to accept when if
aliya0001 [1]

Answer:

When receiving food, you can refuse to accept when if it has a foul odor

Explanation:

Such foul odor makes such food to be rejected because of the health implication as well as it does not equate to the money paid for such services rendered.

5 0
3 years ago
Empire Electric Company (EEC) uses only debt and common equity. It can borrow unlimited amounts at an interest rate of rd = 9%,
solniwko [45]

Answer:

cost of common equity = 14.46%

WACC = 11.29%

accept = Project A

Explanation:

Cost of common equity is the return that is required by Holders of Common Stock.

The available details can be used to calculate the cost of common equity using the Dividend Growth Model as follows :

Cost of common equity = (Next year`s Dividend / Current Market Price of a Stock) + Expected Growth

                                        = ($2.20/$26)+6%

                                        = 14.46%

WACC is the minimum return that a project must offer before it can be accepted.It shows the risk of the company.

Cost of Debt = Market Interest Rate × (1 - tax rate)

                     = 9.00% × (1-0.40)

                     = 5.40%

Capital Source                Weight                 Cost                 Total

Debt                                   35%                  5.40%               1.89%

Common Equity                65%                 14.46%               9.40%

Total                                 100%                 19.86%              11.29%

Therefore WACC is 11.29%

When evaluating projects, Compare the Project`s Internal Rate of Return (IRR) to the WACC.

<u>Project A</u>

IRR 12% > WACC 11.29%

Therefore Accept

<u>Project B/S</u>

IRR 11% < WACC 11.29%

Therefore Do Not Accept

3 0
3 years ago
Foley Foods is a mid-size food processing facility that has had a significant increase in business lately. The firm needs to hir
pishuonlain [190]

Answer:

As a government contractor, Foley Food must have an employee assistance program.

Explanation:

For Foley foods to increase its productivity need, the firm will have to hire new workers to assist other workers for the night shift, as to improve its productivity needs.

With not having more workers to assist in the night, their employees are faced with a potential stress and burnout which are synonymous to employee exhaustion and disillusionment. And since the firms had been able to recognize their limitations, its advisable to hire more workers.

8 0
3 years ago
Strategy at a ________ level is primarily focused on the products and services provided to customers and on finding ways to deve
seraphim [82]

Answer:

2. business unit

Explanation:

The business-level unit strategy refers to the strategy that mainly focused on the company products and the services that would be provided to the customers with the aim of gaining maximum profit, competitive advantage so that the company goals and the objectives could be accomplished.  

Offering them better products and services create the long term relation with the customer that would result in a sustainable competitive advantage so that it could create a standardized position in a market

8 0
3 years ago
The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed wh
Genrish500 [490]

Answer:

c. $1,740 F

Explanation:

The $\text{material quantity variance}$ is the measure of the $\text{difference}$ between the amount of materials that is used in actual for the production process and the amount of the material that was expected or estimated to be used in the production process.

It is given that the Snuggs Corporation applies the variable overhead on direct labor hour basis.

Therefore, the SQ = 2.8 ounces per unit x 1100 units =   3080 ounces

The materials quantity variance = (AQ - SQ) x SP

                                            = (2790 ounces - 3080 ounces) x $ 6 per ounce

                                            = (-290 ounces) x $ 6

                                            = $ 1740 F

4 0
3 years ago
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