When bonds are issued at their face amount, the journal entry will include a __________ to _________

Judd Company has a beginning inventory in year one of $1,400,000 and an ending inventory of $1,694,000. The price level has incr

kotykmax [81]

Answer:

The ending inventory under the dollar-value LIFO method is $1,554,000.

Explanation:

The dollar-value LIFO method can be described as a variation on the last in, first out (LIFO) method which focuses on the estimation of a conversion price index that can be employed to compare the year-end inventory to the base year cost.

The ending inventory under the dollar-value LIFO method can be calculated as follows:

Beginning inventory at begining price level = $1,400,000

Ending inventory at ending price level = $1,694,000

Beginning price level = 100

Ending price level = 110

Beginning price index = Beginning price level / Beginning price level = 100 / 100 = 1.0

Ending price index = Ending price level / Beginning price level = 110 / 100 = 1.1

Ending inventory at base year prices = Ending inventory at ending price level / Ending price index = $1,694,000 / 1.1 = $1,540,000

Real-dollar quantity increase in inventory = Ending inventory at base year prices - Beginning inventory = $1,540,000 - $1,400,000 = $140,000

Value of real dollar quantity increase in inventory = Real dollar quantity increase in inventory * Ending price index = $140,000 * 1.1 = $154,000

Dollar value LIFO Ending inventory = Beginning inventory at begining price level + Value of real dollar quantity increase in inventory = $1,400,000 + $154,000 = $1,554,000

Therefore, the ending inventory under the dollar-value LIFO method is $1,554,000.

5 0

4 years ago

A customer holds 100 shares of ABC Corp $100 par convertible preferred stock convertible at a 10 to 1 ratio. If ABC declares and

Leviafan [203]

Answer:

B. 100 shares of ABC preferred stock

Explanation:

Shares are ownership stakes of a company that are given out to individuals who contribute to capital base of a company.

Preference shares are those whose owners recieve preference in payment of dividends, a fixed dividend is paid to them.

Ordinary shares recieve less preference when dividend is paid, usually coming last in divedend payment.

In this scenario ABC has decided to pay 10% stock dividend. This will be paid to ordinary share holders.

So the person with 100 preference shares will have 100 preference shares

10% of par value of $100 is 0.1 * 100= $10

Number of shares are 100 so the value is now 100 * $10 = $1,000

Since the conversion rate of preference to ordinary shares is 10:1

Number of preference shares= 1,000 ÷ 10= 100 preference shares

5 0

3 years ago

All of the following would be considered closing costs except for: a) A title search b) Cost of repainting the kitchen before mo

otez555 [7]

B/ <span>Cost of repainting the kitchen before moving in</span>

5 0

3 years ago

In the text, Curves is an example of which path? a. Looking across alternative industries b. Looking across strategic groups wit

Elena L [17]

Answer:

The correct option is D) Looking across complementary offerings

Explanation:

There are about 6 well-known paths to achieving a <em>Blue Ocean Strategy.</em>

Generally, the Blue Ocean Strategy (BOS) seeks to avoid locking horns with the competition by identifying niche areas that are critical to the attainment of a competition-free space. According to the BOS took kit, there are 6 paths to achieving a blue ocean strategy.

One of them is called looking across complementary offerings.

Another term for the Curve is Value Ramp. Value Ramp simply refers to a methodology for evaluating one's service/product offerings. It consists of a graph that plots a curve sloping upwards from left to right, showing the relationship between price and the value or perception of value being delivered by the business.

The principle offered here stated that the higher the perception of one's brand, the more one should be able to charge for their services.

Value is thought to increase as the business delivers more and more personalized services in a relationship-oriented fashion rather than generic products and services which are readily available off the shelf in most cases.

Cheers

7 0

3 years ago

Here I Sit Sofas has 7,100 shares of common stock outstanding at a price of $94 per share. There are 600 bonds that mature in 30

Zinaida [17]

Answer:

Weight of debt = 57.83 %

Explanation:

given data

number of shares = 7,100

price = $94 per share

number of bonds = 600

mature time = 30 year s

coupon rate = 6.8 percent

bonds par value = $2,000

sell = 108.5 percent

stock outstanding = 6,000 shares

stock outstanding price = $47 per share

to find out

capital structure weight of the debt

solution

first we get here Equity market value that is express as

Equity market value = number of shares × price per share

Equity market value = 7100 × $94

Equity market value = $667,400

and

current debt value will be here as

current debt value = number of bonds × price per bond

current debt value = 600 × (1.085 × 2000)

current debt value = $1,302,000

and now Preferred stock value will be

Preferred stock value = stock outstanding × stock outstanding price

Preferred stock value = 6,000 × $47

Preferred stock value = $282000

and total capital will be as

Total capital = Equity market value + current debt value + preferred stock value ..................1

put here value

Total capital = $667,400 + $1,302,000 + $282000

total capital = $2251400

so here Weight of debt will be

Weight of debt = debt value ÷ total capital ..............2

Weight of debt = $\frac{1,302,000}{2251400}$

Weight of debt = 0.578306

Weight of debt = 57.83 %

6 0

3 years ago

When bonds are issued at their face amount, the journal entry will include a __________ to __________.

When bonds are issued at their face amount, the journal entry will include a to .