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4 years ago

When products held in inventory are sold:

Business

1 answer:

Elanso [62]4 years ago

3 0

Answer:

C.)Finished Goods Inventory is credited.

Explanation:

The journal entry at the time of product sold which are held in inventory is shown below:

Cost of Goods Sold A/c Dr XXXXX

To Finished goods inventory A/c XXXXX

(Being the product sold is recorded)

For recording this transaction, we debited the cost of goods sold and credited the finished goods inventory account so that the correct posting could be done

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Pina Colada Corp. holds Tamarisk, Inc. $44400, 120-day, 15% note. The entry made by Pina Colada Corp. when the note is collected

Dafna1 [17]

Answer and Explanation:

The journal entry is shown below

Cash $46,620

To Notes Receivable $44,400

To Interest receivable ($44,400 × 15% × 120 days ÷ 360 days)

(Being the cash received is recorded)

Here we debited the cash as it increased the assets and at the same time we credited the interest receivable and the note receivable as it decreased the assets

The same is to be considered

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3 years ago

The Wood Division of Bramble Corp. manufactures rubber moldings and sells them externally for $45. Its variable cost is $25 per

Lyrx [107]

Answer:

c. $45

Explanation:

Transfer price is the price charged for a product which is transferred to other department/ division / subsidiary of same company / group. The minimum selling price in the absence of any excess capacity is the price available in the market, because the company has demand for the product and it does not lost the sale if transfer not takes place. The product can be sold in the market. So the Transfer price should be $45.

4 0

3 years ago

Read 2 more answers

Dome Metals has credit sales of $270,000 yearly with credit terms of net 90 days, which is also the average collection period. A

bixtya [17]

Answer:

Net change in income = $8,100

Explanation:

Given:

Current credit sales= $270,000 per year.

Average collection period= 90 days

A 2/15, net 90 means a 20℅ discount if payment is made within 15 days.

Which means new credit terms increase will be

(90/15) * 20℅ = 120℅

We now find the following:

•Revised sales will be = (current sales * new credit terms increase)

= $270,000 * 120℅ = $324,000

•Increase in sales = ( new sales - current sales)

=$324,000 - $270,000 = $54,000

•Profit increase = (profit percent * Increase in sales)

= 15℅ * $54,000 = $8,100

• Average receivable under existing policy =

= $270,000 * (90/360) = $67,500

• Average under new policy =

$325,000 * (15/360) = $13,500

• Receivable reduction= $67,500 - $13,500 = $54,000

• Interest savings

= $54,000 * 12℅ = $6,480

• Cost of discount =

$324,000 * 2℅ = $6,480

Therefore the net change in income if new credit terms are adopted will be = (increase in profit + interest savings - cost of discount)

= $8,100+$6,480-$6,480

= $8,100

3 0

3 years ago

Adam and Alyssa are equal partners in the PartiPilo Partnership. The partners formed the partnership three years ago by contribu

Rina8888 [55]

Answer and Explanation:

Partnership can be defined as a form of business which is often carried out by two or more people with the sole aim of making profit.

a) Adam receives only money in the distribution and the distribution exceeds his basis.

Particular Amount

Distribution $16,000

Less: Basis $12,000

Recognized Gain $4,000

b) Adam has $0 remaining basis in his partnership interest due to the fact that all the money or cash he received in the partnership distribution is allocated in outside basis and not within basis.

c) Alyssa has not recognized any gain or loss from the current distribution due to the fact that the cash Alyssa received in distribution is fully adjusted in the outside basis.

d) After adjusting the money received against the outside basis the remaining outside basis of $4,000 will be adjusted by property, which is why Alyssa will assign $4,000 basis to the property.

Particular Amount

Basis $12,000

Less: cash distribution $8,000

Less: Property $4,000

Remaining basis $0

Therefore Alyssa remaining basis in her partnership interest will be $0

4 0

3 years ago

You own 100 shares a $50 par value preferred stock. The stock has a 12% dividend rate, and a current market price of $85 per sha

andriy [413]

Answer:

Option (a) is correct.

Explanation:

Value of stock:

= Present value of all cash flows

$=Dividend[\frac{1-\frac{1}{(1+r)^{n} } }{r}] + Par\ value[\frac{1}{(1+r)^{n} }]$

$=50\times 0.12[\frac{1-\frac{1}{(1.08)^{5} } }{0.08}] + 50[\frac{1}{(1.08)^{5} }]$

= $6 × 3.9927 + $50 × 0.6806

= $23.96 + $34.03

= $57.99 or $58

5 0

3 years ago