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2 years ago

Which account will a merchandising business close out at the end of the year?

Business

1 answer:

Paha777 [63]2 years ago

8 0

Answer: B. Sales returns and allowances

Explanation:

Accounts receivable is not closed out because people will still be owning at year end. Prepaid Insurance is an unrecognized payment for an expense in another period so it is not closed out either.

Land is a fixed asset so it is not closed and Accumulated depreciation will be left open to keep depreciating assets.

Only account that will be closed is the Sales returns and Allowances account as these are periodic entries and so should be closed out in the period.

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owns a Dell laptop computer. She uses the computer in class and her classmates can see the Dell logo when she uses her laptop. O

erastovalidia [21]

Complete question:

Trudy owns a Dell laptop computer. She uses the computer in class and her classmates can see the Dell logo when she uses her laptop. One of her classmates is looking to purchase a new laptop and asks Trudy her opinion of Dell computers. Trudy informs her classmate that she is satisfied with her laptop and recommends that her classmate purchases one, too. For Dell, Trudy is exhibiting some of the benefits of _____.

a. brand recognition

b. brand equity

c. brand insistence

d. brand loyalty

e. brand mark

Answer:

For Dell, Trudy is exhibiting some of the benefits of brand loyalty .

Explanation:

Brand loyalty is described as favorable emotions towards the company and willingness to buy the same product or service consistently from the same company now and in the future, irrespective of the behavior of the rival or adjustments in the world.

Corporations spend large sums of money in customer support and promotions in order to create and retain brand awareness with the existing commodity.

Coca-Cola Corporation is an example of an established company that has culminated in consumers showing brand loyalty in light of Pepsi's beverages and advertisement campaigns over the years.

3 0

3 years ago

Morgan Company's budgeted income statement reflects the following amounts:Sales Purchases ExpensesJanuary $ 120,000 $ 78,000 $ 2

Whitepunk [10]

Answer:

e.$113,300

Explanation:

Download xlsx

7 0

3 years ago

Pro forma balance sheet Peabody & Peabody has 2019 sales of $10 million. It wishes to analyze expected performance and finan

zysi [14]

Answer:

Peabody & Peabody

a. Peabody & Peabody

Pro Forma Balance Sheet

December 31, 2021 ($000)

Cash 480

Marketable securities 200

Accounts receivable 1,440

Inventories 2,160

Total current assets 4,280

Net fixed assets 4,820

Total assets 9,100

Liabilities and Stockholders equity:

Accounts payable 1,680

Accruals 500

Other current liabilities 80

Total current liabilities 2,260

Long-term debt 2,000

Total liabilities 4,260

Common equity 3,900

Total liabilities and stockholders’ equity $8,160

Required Finance 940

b. From the statement prepared in part a, it is clear that Peabody & Peabody requires new financing of $940,000 for 2020 to meet the projected assets base.

Explanation:

a) Data and Calculations:

2019 Sales = $10 million

Pro Forma Balance Sheet

December 31, 2017 ($000)

Assets:

Cash 400

Marketable securities 200

Accounts receivable 1,200

Inventories 1,800

Total current assets 3,600

Net fixed assets 4,000

Total assets 7,600

Liabilities and Stockholders equity:

Accounts payable 1,400

Accruals 400

Other current liabilities 80

Total current liabilities 1,880

Long-term debt 2,000

Total liabilities 3,880

Common equity 3,720

Total liabilities and stockholders’ equity $7,600

Purpose: To analyze expected performance and financing needs for 2021.

1. Percent of Sales ($12 million)

Accounts receivable, 12% $1,440

Inventory, 18% $2,160

Accounts payable, 14% $1,680

Net profit margin, 3% $360

2. Market securities $200

3. Cash balance (desired minimum) $480

4. Net fixed assets 4,000

New equipment in 2020 650

Depreciation, 2020 (290)

New equipment in 2021 850

Depreciation, 2021 (390)

Net fixed assets $4,820

5. Accruals $500

8. Dividend payout = 50% of $360 = $180

Retained Earnings (current) = $180

Common Equity:

2019 3,720

Income 180 (Retained Earnings)

2020 3,900

5 0

3 years ago

Which of the following statement is false? Group of answer choices Financing activities include the obtaining of cash from issui

Lapatulllka [165]

Answer:

Interest payment on bonds payable is a cash outflow from financing activities.

Explanation:

The only statement which is false from the list is : Interest payment on bonds payable is a cash outflow from financing activities.

Interest payment on bonds payable is an expense in the income statement used to determine the income for the year. Net Income falls under the Cash flows from Operating Activities.

6 0

3 years ago

Shamrock Company had the following information available at the end of 2014.

mars1129 [50]

Answer and Explanation:

The preparation is presented below:

Shamrock Company

Statement of Cash Flows

For the Year Ended December 31, 2014

(Direct Method)

Cash flows from operating activities

Cash receipts:

Cash received from customers $1,153,660

Dividends received $2,500

Total cash receipts $1,156,160

Cash payments:

Cash paid to suppliers $762,690

Cash paid for operating expenses $225,230

Taxes paid $39,920

Interest paid $61,776

Total cash payments -$1,089,616

Net cash provided by operating activities $66,544

Cash flows from investing activities

Sale of short-term investments $14,080

Sale of land $55,590

Purchase of equipment -$124,570

Net cash used by investing activities -$54,900

Cash flows from financing activities

Proceeds from issuance of common stock $29,526

Principal payment on long-term debt -$9,580

Dividends paid -$23,890

Net cash used by financing activities -$3,944

Net increase in cash $7,700

Cash, January 1, 2014 $3,060

Cash, December 31, 2014 $10,760

Working notes

Sales Revenue $1,160,450

– Increase in Accounts Receivable $6,790

Cash received from customers $1,153,660

Cost of Goods Sold $748,980

+ Increase in Inventory $5,020

+ Decrease in Accounts Payable $8,690

Cash paid to suppliers $762,690

Operating Expenses $275,640

– Depreciation/Amortization Expense -$39,330

– Decrease in Prepaid Rent -$110,80

+ Increase in Prepaid Insurance $1,640

+ Increase in Office Supplies $520

– Increase in Wages Payable -$2,160

Cash paid for Operating Expenses $225,230

Income tax expense $40,350

Less:Increase in income taxes payable -$430

Taxes paid $39,920

Interest Expense $52,270

+ Decrease in Bond Premium $9,506

Interest paid $61,776

Reconciliation of Net Income to Net Cash Provided by Operating Activities:

Net income $58,420

Adjustments made to reconcile net income to net cash provided by operating activities:

Add: Depreciation expense $39,330

Add: Decrease in prepaid rent $110,80

Add: Increase in income taxes payable $430

Add: Increase in wages payable $2,160

Less: Increase in accounts receivable -$6,790

Less: Increase in inventory -$5,020

Less: Increase in prepaid insurance -$1,640

Less: Increase in office supplies -$520

Less: Decrease in accounts payable -$8,690

Less: Gain on sale of land -$8,320

Less: Gain on sale of short-term investments -$4,390

Less: Amortization of bond premium -$9,506

Total adjustments $8,124

Net cash provided by operating activities $66,544

8 0

3 years ago