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3 years ago

fifo uses the cost for cost of goods sold on the income statement and the cost for inventory on the balance sheet.

1 answer:

4 0

fifo uses the oldest cost for cost of goods sold on the income statement and the newest cost for inventory on the balance sheet.

FIFO is an inventory accounting system that means first in, first out. This means that the first goods that are bought are the first that are assumed to be sold and the newest goods are assumed to remain in inventory.

For example, if you purchase 1 unit of a good at $3 on 1/3/21 and a second unit of the good at $5 on 31/03/21. Only one unit of the good is sold If the FIFO method is used, the cost of good sold would be $3 and the ending inventory would be $5.

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Kier Company issued $700,000 in bonds on January 1, Year 1. The bonds were issued at face value and carried a 4-year term to mat

mezya [45]

Answer: Interest expense = $45500

Cash outflow = $45500

Explanation:

Based on the information that were given in the question, the amounts of interest expense and cash flows from operating activities, that will be reported in the financial statements for the year ending December 31, Year 1 will be calculated thus:

Interest expense = $700,000 × 6.50%

= $700,000 × 0.065

= $45500

The interest expense of $45500 will be reported on December 31, Year 1 in the income statement and will also be reported in the cash outflow as well. Therefore,

Interest expense = $45500

Cash outflow = $45500

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3 years ago

Brooke and Sandy both attend the same college and have the same expenses for tuition, books, and supplies. However, Brooke is a

baherus [9]

Answer: Option (B) is correct.

Explanation:

Opportunity cost is the benefit that is foregone for an individual by choosing one alternative over other alternatives available to him.

If the opportunity cost is lower for an individual then this will benefit him whereas if the opportunity cost is higher then this will not benefit the individuals.

The opportunity cost of attending college for Brooke is the amount that she could earn as an actress i.e. $2 million per year.

The opportunity cost of attending college for Sandy is the amount that he could earn by serving hamburgers i.e. $10,000 a year.

Therefore, opportunity cost of attending college is greater for Brooke than for Sandy.

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4 years ago

The most recent financial statements for Bello Co. are shown here: Income Statement Balance Sheet Sales $ 20,700 Current assets

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Question : What is sustainable growth Rate

Answer:

Sustainable growth Rate = 1.69 %

Explanation:

Sustainable growth Rate = Return on Equity x Retention Rate

Where Return on Equity = Asset Utilization Rate x Profitability Rate x Financial Utilization Rate

Asset Utilization Rate= Total Sales/Total Assets

= 20,700/46,260 = 0.45

Profitability Rate = Net Income/ Total Assets

= 4,940/46,260 = 0.11

Financial Utilization Rate = total debt/ Total equity

= 16,780/ 29,480 = 0.57

Return on Equity = 0.45 x 0.11 x 0.57

=0.028

Retention Rate = 1- dividend pay out ratio

= 1-0.40

= 0.60

Sustainable growth Rate = 0.028 x 0.60

= 1.69 %

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4 years ago

Jason works part-time at a grocery store after school. Jason has worked at the store for two years but still hasn't received a w

ehidna [41]

Answer:

a. Jason works harder than the other employees

Explanation:

In this scenario, the statement that would strengthen Jason's case would be that he works harder than the other employees. If Jason is able to provide proof of this then that would indicate that effort and work-efficiency is not the reason for Jason not receiving a wage increase. This would mean that the reason is either personal or superficial which are all labor-market discrimination. Therefore, if Jason can prove that he does actually work harder than the other employees it would drastically increase his chances of winning the court case against his employer.

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3 years ago

A company can manufacture a product with off-the-shelf hand tools. Fixed manufacturing costs are $1200 for tools and $1.60 manuf

mixer [17]

Answer:

3.06 years

Explanation:

The break-even point is when the total revenue equals the total production costs. In case of the change in manufacturing plan, the break even point is when the additional fixed costs are equal to the savings from the reduced manufacturing costs

Total Manufacturing Costs

<em>Opt 1: Hand Tool Method</em>

Cost = 1.60$/unit*4200unit/year*xyear

Cost = $6720x

<em>Opt 2: Automated System</em>

Cost = 0.65$/unit*4200unit/year*xyear

Cost = $2730x

Additional Fixed Costs

Additional Fixed Cost = $13400 - $1200

Additional Fixed Cost = $12200

Break Even Point

Additional Fixed Cost = Opt 1 Manufacturing Cost - Opt 2 Manufacturing Cost

$12200 = $6720x - $2730x

12200 = 3990x

x = 3.06 years

Assumptions:

The annual volume is the same every year
The tools/system costs are a one time costs
No depreciation of the system has been considered
The manufacturing cost per unit is the same every year
There are no other additional costs/expenses

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4 years ago

fifo uses the ______ cost for cost of goods sold on the income statement and the ______ cost for inventory on the balance sheet.

fifo uses the cost for cost of goods sold on the income statement and the cost for inventory on the balance sheet.