The condensed product-line income statement for Rhinebeck Company for the month of October is as follows:
Rhinebeck Company
Product-Line Income Statement
For the Month Ended October 31
Hats Gloves Mufflers
Sales $71,000 $105,700 $45,000
Cost of goods sold (32,600) (42,300) (27,000)
Gross profit $38,400 $63,400 $18,000
Selling and administrative27400 (42,800) (25000)
expenses
Operating income (loss) $11,000 (20,600) $(7,000) Fixed costs are 20% of the cost of goods sold and 30% of the selling and administrative expenses. Rhinebeck Company assumes that fixed costs would not be materially affected if the Gloves line were discontinued.
Prepare a differential analysis dated October 31 to determine if Mufflers should be continued (Alternative 1) or discontinued (Alternative 2).

Answers

Answer 1

Answer:

Mufflers should be continued (Alternative 1)

Explanation:

Preparation of a differential analysis dated to determine if Mufflers should be continued (Alternative 1) or discontinued (Alternative 2).

DIFFERENTIAL ANALYSIS

Continued (Alternative 1); Discontinued (Alternative 2); Differential effect on income Alternative 2)

October 31

Revenue $45,000 $0 ($45,000)

Costs:

Variable cost of goods sold ($21,600) $0 $21,600

[$27,000*(1-20%)]

Variable selling and administrative expense

($17,500) $0 $17,500

[$25,000*(1-30%)]

Fixed income ($12,900) ($12,900) $0

[($27,000*20%)+($25,000*30%)]

Income(Loss) ($7,000) ($12,900) ($5,900)

Based on the above Differential Analysis MUFFLERS SHOULD BE CONTINUED reason been that the income will decrease by $5,900 if Mufflers discontinued.


Related Questions

Burns Industries currently manufactures and sells 18,000 power saws per month, although it has the capacity to produce 33,000 units per month. At the 18,000-unit-per-month level of production, the per-unit cost is $61, consisting of $38 in variable costs and $23 in fixed costs. Burns sells its saws to retail stores for $78 each. Allen Distributors has offered to purchase 4,800 saws per month at a reduced price. Burns can manufacture these additional units with no change in its present level of fixed manufacturing costs. Using an incremental analysis approach, Burns should consider accepting this special order only if the price per unit offered by Allen is at least:

Answers

Answer:

Burns Industries

Using an incremental analysis approach, Burns should consider accepting this special order only if the price per unit offered by Allen is at least:

above $38 (the variable cost per unit).

Explanation:

a) Data and Calculations:

Monthly production and sales units = 18,000

Production capacity per month = 33,000 units

Costs at the 18,000-unit-per-month level of production:

Variable costs = $38

Fixed costs =        23

Total per unit =  $61

Selling price per unit = $78

Special offer for 4,800 saws per month, without changing the fixed manufacturing costs.

b) Incremental analysis approach is a management decision technique that specifies that only relevant, marginal, or differential costs should be taken into account.  It rules out the inclusion of sunk or fixed costs, which do not change between alternatives.

After a few years of successful business, Thomas saw the need to diversify his business to take advantage of the growth potential of new markets. Doing so also reduces the business risk. He set up a new company that sells 3 models of tables: Russian style, Italian style, and Mexican style. His targeted market was in NYC where there is huge demand for those products. Operating results for June are below:


a. If Italian style is discontinued, management estimates that sales of Russian style will increase by 20%. In good form, prepare an incremental analysis to determine if Italian style should be discontinued.
b. What qualitative factors should Thomas consider relating question (a)?
c. Should Italian style be discontinued based solely on quantitative aspects? Briefly justify your response.
d. Without creating new income statements, and using your results from your analysis in part A, determine the amount of the company’s new net income if Italian style is discontinued. Show your calculations.

I have the work completed...I just need to check my work. I would appreciate any help as soon as possible.

Answers

It seems to me personally that your work is acceptable from what I am shown. The only little thing I would change is instead of using the actual number in your sentences, spell the number to make it look more professional. For example instead of using 3 in a sentence just type or write three.

Hope this helps have an excellent day!

Assume you just purchased 100 shares of Apple stocks at $300. You are worrying that the competition from other tablet PC and smart phone producers will have a negative impact on Apple stock prices in 1 month. Generally speaking, you are still quite bullish on Apple stock. In order to hedge against this downside risk, you establish a protective put position by buying a put option contract with around 1-month maturity on Apple stock. However, the premium of the put option with strike price at $300 is $12, which is quite expensive. If you feel purchasing the put option with strike price at $300 and $12 premium is too expensive, what else can we do to reduce the cost of protective put position

Answers

Answer:

If you believe that the premium is too expensive, then you should try to purchase another put option with a lower strike price. This will probably reduce your potential profits, but it will also decrease the amount of money that you will pay for the put options. For example, a put option with a strike price of $290 might be worth $5.

Mars Inc., an oil and gas incorporation, opened its first unique service station in Mexico. The service station consisted of pumping islands, convenience stores, and separate food courts. Owing to the station's success, the company opened more than 300 service stations worldwide. Identify the offensive strategic goal that can explain why Mars expanded its services globally. Group of answer choices To increase long-term growth and profit prospects To prevent global consolidation To preempt competitors' from opening similar stores To avoid being locked out of markets by arriving too late

Answers

Answer: To increase long-term growth and profit prospects

Explanation:

The company saw that the unique service station was a success which meant that it brought in profits. They therefore applied the business model to other places so that they could make profits from there as well.

This will increase the long-term growth of the company as well as profit prospects because there will now be a chance of making the same profits as they did from the first station but this time, from 300 stations. The increased market presence coupled with the services they offer, makes for huge growth and profit prospects.

Marigold Corporation had net income of $170000 and paid dividends to common stockholders of $51000 in 2019. The weighted average number of shares outstanding in 2019 was 34000 shares. Marigold Corporation's common stock is selling for $32 per share on the New York Stock Exchange. Marigold Corporation's price-earnings ratio is :__________

a. 4.92 times.
b. 9.14 times.
c. 6.40 times.
d. 5.00 times.

Answers

Answer:

P/E ratio = 6.40 times

Option c is the correct answer.

Explanation:

The P/E ratio or price earnings ratio measures the price that the investors are willing to pay for each $1 of earnings of the company. It is calculated as follows,

P/E ratio = Price per share / Earnings per share

We can calculate the earnings per share by dividing the net income by the number of shares outstanding.

P/E ratio = 32 / (170000 / 34000)

P/E ratio = 6.40 times

Describe four ways in which the government creates an enabling business environment.
(4 mks)

Answers

Answer:

Provision of credit facilities at favourable rates.

Ensuring political stability and good will.

Training and educating the population to create a pool of skilled manpower.

Marketing of final products for producers.

Waterway Industries is planning to sell 1000 boxes of ceramic tile, with production estimated at 670 boxes during May. Each box of tile requires 44 pounds of clay mix and a 0.75 hour of direct labor. Clay mix costs $0.40 per pound and employees of the company are paid $16 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Waterway has 4200 pounds of clay mix in beginning inventory and wants to have 3900 pounds in ending inventory. What is the total amount to be budgeted for manufacturing overhead for the month

Answers

Answer:

Allocated MOH= $8,844

Explanation:

Giving the following information:

Production= 670 boxes

Each box of tile requires 0.75 hours of direct labor.

Direct labor rate= $16 per hour.

Manufacturing overhead is applied at a rate of 110% of direct labor costs.

First, we need to determine the total direct labor costs:

Direct labor hours= 670*0.75= 502.5

Direct labor costs= 502.5*16= $8,040

To calculate the applied overhead, we need to use the following formula:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 1.1*8,040

Allocated MOH= $8,844

Why did bank runs cause banks to fail?

Answers

Answer:

Another phenomenon that compounded the nation's economic woes during the Great Depression was a wave of banking panics or “bank runs,” during which large numbers of anxious people withdrew their deposits in cash, forcing banks to liquidate loans and often leading to bank failure.

Explanation:

Answer:

It caused them to fail becuase people withdrew their deposits in cash, t o liquidate loans.

Explanation:

“Bank runs” was when  large numbers of anxious people withdrew their deposits in cash, forcing banks to liquidate loans , leading to bank failure.

How do deductions affect the amount of a paycheck?

Answers

Deductions are amounts that are subtracted from an employee's gross pay (their total earnings before any deductions or taxes are taken out) to determine their net pay.

Several types of deductions may be taken out of a paycheck, including taxes, insurance premiums, and retirement plan contributions.

Additionally, some deductions, such as those for 401(k) contributions, are made on a pre-tax basis, which means that they are taken out of an employee's gross pay before taxes are calculated. Other deductions, such as taxes and insurance premiums, are taken out of an employee's gross pay after taxes have been calculated.

Employers must abide by the laws and regulations of the state and federal governments when it comes to deductions, and provide their employees with detailed information about the deductions taken out of their paychecks.

In summary, deductions are amounts that are subtracted from an employee's gross pay to determine their net pay and can include taxes, insurance premiums, and retirement plan contributions. Employers must take these deductions legally and should provide employees with detailed information about what deductions are being taken out of their paychecks.

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Fitz Company reports the following information.
Selected Annual Income Statement Data
Net income $373,000
Depreciation expense 45,200
Amortization expense 8,800
Gain on sale of plant assets 6,300
Selected Year-End Balance Sheet Data
Accounts receivable decrease $ 140,100
Inventory decrease 51,500
Prepaid expenses increase 6,800
Accounts payable decrease 9,700
Salaries payable increase 2,300
Use the indirect method to prepare the operating activities section of its statement of cash flows for the year ended December 31.

Answers

Answer:

operating activities section

Net income                                                               373,000

Adjustment for non cash items :

Depreciation expense                                               45,200

Amortization expense                                                 8,800

Gain on sale of plant assets                                      (6,300)

Adjustment for Changes in Working Capital :

Accounts receivable decrease                                140,100

Inventory decrease                                                    51,500

Prepaid expenses increase                                      (6,800)

Accounts payable decrease                                     (9,700)

Salaries payable increase                                          2,300

Net Cash Provided by Operating Activities           598,100

Explanation:

The operating activities section of its statement of cash flows for the year ended December 31 has been prepared above using indirect method.

Does anyone know if can I take Spanish class in college if I speak Spanish perfectly? Would there be a problem or not?

Answers

Well depending on how quick you learn but otherwise I think you’ll do great

Graham Corp. has 1,000 cartons of oranges that were harvested at a cost of $26,500. The oranges can be sold as is for $30,000. The oranges can be processed further into orange juice at an additional cost of $12,500 and be sold at a price of $46,000. The net benefit (additional income) from processing the oranges into orange juice instead of selling as is would be: rev: 12_08_2020_QC_CS-243270 Multiple Choice $16,000. $(16,000). $(3,500). $3,500. $33,500.

Answers

Answer:

C. $3,500

Explanation:

The total cost of orange juice = $26,500 + $12,500

The total cost of orange juice = $39,000

So, the profit on the orange juice = $46,000 - $39,000 = $7,000

Profit when oranges are sold without juice = $30,000 - $26,500

Profit when oranges are sold without juice = $3,500

So, extra income = $7,000 - $3,500 = $3,500

Thus, the net benefit (additional income) from processing the oranges into orange juice instead of selling as is would be is $3,500

The Feline Company has been having some difficulties estimating its manufacturing overhead costs. In the past, manufacturing overhead costs have been related to production levels. However, some production managers have indicated that the size of their production lots might also be having an impact on the amount of their monthly manufacturing overhead costs. In order to investigate this possibility, the company collected information on its monthly manufacturing overhead costs, production in units, and average production lot size for 2020.
Month Production (Units) Manufacturing Overhead Cost Average Monthly Production Lot Size
1 75,000 $ 925,800 20
2 90,000 843,875 19
3 65,000 910,125 24
4 80,000 946,000 19
5 55,000 879,000 24
6 50,000 825,000 18
7 85,000 960,000 22
8 105,000 1,053,500 25
9 102,000 1,020,000 23
10 68,000 905,000 20
11 75,000 938,000 22
12 95,000 995,000 24
Required:
(a.) Use the high-low method to estimate next month's manufacturing overhead costs, assuming the company is planning to produce 92,000 units.
(b.) Use the high-low method to estimate next month's manufacturing overhead costs, assuming the company is planning to run a 21-lot size.

Answers

Answer:

A

Explanation:

B MC Qu. 20-87 Masterson Companys budgeted production... Masterson Company's budgeted production calls for 69,000 units in April and 65,000 units in May of a key raw material that costs $1.75 per unit. Each month's ending raw materials inventory should equal 30% of the following month's budgeted materials. The April 1 inventory for this material is 20,700 unit. What is the budgeted materials needed in units for April

Answers

Answer:

67,800 units

Explanation:

Given the information above,

The budgeted production for April = 69,000 units

The budgeted production for May = 65,000 units

The cost of raw material per unit = $1.75

At the end of each month, the inventory should be = 30%

The April 1 inventory = 20,700 units

Therefore, the budgeted material in units required for April production

= Materials needed + Ending inventory requirement - Beginning inventory available

= 69,000 + (65,000 × 30%) - 20,700

= 69,000 + 19,500 - 20,700

= 67,800 units

11,400 shares of common stock outstanding at a price of $48 per share, It has also issued 300 bonds with a coupon rate of 6.7 percent paid semiannually, and 275 shares of preferred stock that sells a price of $90 per share The bonds mature in 29 years, have a Par value of $1,000, and sell at 108 percent of par. What is the capital structure weight of the common stock

Answers

Answer:

0.4485

Explanation:

Calculation to determine the capital structure weight of the common stock

First step is to calculate the Value of Common Stock

Value of Common Stock = 11,400(48)

Value of Common Stock= $547,200

Second step is to calculate Value of Preferred Stock

Value of Preferred Stock = 275(90)

Value of Preferred Stock = $24,750

Third step is to calculate the Value of Debt

Value of Debt = 1.08(2,000)(300)

Value of Debt= $648,000

Now let calculate the Weight of common stock

Weight of common stock =$547,200 /(547,200 + 24,750 + 648,000)

Weight of common stock=$547,200/$1,219,950

Weight of common stock = 0.4485

Therefore the capital structure weight of the common stock is 0.4485

3. You have Birr 1,500 to invest today at 7% interest compounded annually. Find how much you will have accumulated in the account at the end of (1) 3 years, (2) 6 years, and (3) 9 years.

Answers

1-The amount accumulated at the end of 3 years is Birr 1,837.56

2-The amount accumulated at the end of 6 years is Birr 2,251.10

3-The amount accumulated at the end of 9 years is Birr 2,757.69

The formula to calculate compound interest is

A=P(1+r/n)∧nt

Where, A=  final amount

P= initial Principal

r= rate of interest

t= time period

n= number of times interest applied(annually, quarterly etc)

1- P=1500   r=7%   t=3   n=1

Amount=1500(1+0.07/1)∧3

=1837.56

2- P=1500   r=7%  t=6 years  n=1

Amount = 1500(1+0.07/1)∧6

=2251.10

3- P=1500   rate=7% time t=9 years  n=1

Amount= 1500(1+0.07/1)∧9

=2757.69

Therefore Amount at the end of 3 years is 1837.56

6 years is 2251.10 and at the end of 9 years is 2757.69

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Linda, who files as a single taxpayer, had AGI of $280,000 for 2018. She incurred the following expenses and losses during the year:
Medical expenses (before the 7.5%-of-AGI limitation) $33,000
State and local income taxes 4,800
State sales tax 1,300
Real estate taxes 6,000
Home mortgage interest 5,000
Automobile loan interest 750
Credit card interest 1,000
Charitable contributions 7,000
Casualty loss (before 10% limitation but after $100 floor; not in a Federally declared disaster area) 34,000
Unreimbursed employee business expenses 7,600
Calculate Linda’s allowable itemized deductions for the year.
$______________.
*The AGI limit for medical expenses is 7.5% now for 2018. It was 10% in previous years.*
*Also in 2018, taxpayers can't claim unreimbursed employee expenses because it is now considered personal exp in 2018-2025 due to new tax rules.*

Answers

Answer:

$27,000

Explanation:

Calculation to determine Linda’s allowable itemized deductions for the year.

Local and state taxes $10,000

Home mortgage interest $5,000

Charitable contributions $7,000

Unreimbursed employee expenses Eliminated from 2019

Medical Expense $5,000

[$33,000-(280,000*10%)]

Casualty Loss Eliminated from 2019

Linda's Allowable itemized deduction for the year $27,000

($10,000+$5,000+$7,000+$5,000)

Therefore Linda's Allowable itemized deduction for the year is $27,000

Explain right to be heard with examples

Answers

The right to be heard means that, depending on their age and maturity, children can be involved in decisions and issues that affect them.

What is the right to be heard?The right to be heard (including the participation of children) is a principle of child rights as defined in the United Nations Convention on the Rights of the Child. According to article 12 of the Convention, children have the right to express their views on all matters that affect them, and their views must be given due weight according to their age and maturity. This right applies equally to children's participation in social and political affairs, and to judicial and administrative proceedings. As a general principle, children's right to be heard should be addressed not only as vulnerable individuals with special protection needs, but also as informed decision makers, rights holders and active members of society. It reflects the child's notion of 'agency', The right to a hearing in article 12 is closely related to other articles of the Convention, which together form the so-called 'participation rights' of children and the recognition of children as citizens with rights holders. Emphasis on understanding.

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A company has won an important government contract. Several employees have been transferred from their existing projects to support a new contract. Some of the employees who have transferred will be working long hours and still need access to their project information to transition work to their replacements.
Which of the following should be implemented to validate that the appropriate offboarding process has been followed?
A. Separation of duties
B. Time-of-day restrictions
C. Permission auditing
D. Mandatory access control

Answers

Answer:

C. Permission auditing

Explanation:

Since in the question it is mentioned that some of the employees would have been transferred and still they need to access the project information in order to transit the work to their replacements

So for this the permission auditing should be implemented so that the employees could get the relevant information what they need and according to that they can do the work

Therefore, the option c is correct

Assume you work for a company as an accountant and you have been asked to calculate the depreciation expense for each year of a new machine that your company purchased on April 1, 2021, at a cost of $ 350,000. You have estimated that the machine will have a salvage value of $15,000. The machine is expected to be used for 27,800 working hours during its 5-year life.

a) Prepare the depreciation schedule for each year of the useful life under
straight line method.

b) Compute the depreciation expense for 2021, 2022 and 2023 under units-of activity method, assuming machine usage was 2700 hours in 2021 and 3500 hours and 2200 hours in 2022 and 2023 respectively.

Answers

Answer:

a) Depreciation Schedule under Straight-Line Method:

Date               Cost         Depreciation     Accumulated    Net Book Value

                                           Expense        Depreciation

April 1, 2021 $350,000     $50,250            $50,250            $299,750

2022              350,000        67,000              117,250              232,750

2023              350,000        67,000             184,250               165,750

2024              350,000        67,000            251,250                 98,750

2025              350,000        67,000            318,250                  31,750

b) Depreciation expense under the units-of-activity method:

2021       2,700 * $12.05 = $32,535

2022     3,500 * $12.05 = $42,175

2023     2,200 * $12.05 = $26,510

Explanation:

a) Data and Calculations:

Cost of equipment on April 1, 2021 = $350,000

Estimated salvage value = $15,000

Depreciable amount = $335,000

Estimated useful life = 5 years

Annual Depreciation:

Straight-line method = $67,000 ($335,000/5)

Expected machine usage hours = 27,800

Depreciation rate under the unit-of-activity method = $335,000/27,800

= $12.05

Sardi Incorporated is considering whether to continue to make a component or to buy it from an outside supplier. The company uses 13,600 of the components each year. The unit product cost of the component according to the company's cost accounting system is given as follows: Direct materials $ 9.40 Direct labor 6.40 Variable manufacturing overhead 2.20 Fixed manufacturing overhead 4.20 Unit product cost $ 22.20 Assume that direct labor is a variable cost. Of the fixed manufacturing overhead, 30% is avoidable if the component were bought from the outside supplier. In addition, making the component uses 3 minutes on the machine that is the company's current constraint. If the component were bought, time would be freed up for use on another product that requires 6 minutes on this machine and that has a contribution margin of $5.80 per unit. When deciding whether to make or buy the component, what cost of making the component should be compared to the price of buying the component

Answers

Answer:

See below

Explanation:

Sardi Inc.

Cost of making components

Direct materials = $9.40

Direct labor = $6.40

Variable manufacturing overhead = $2.20

Fixed manufacturing overhead = (30% × $4.20 is avoidable) = $1.26

Opportunity cost = ($5.80 per unit ÷ 6 minutes per unit) × 3 minutes = $2.90

Total cost

= $9.40 + $6.40 + $2.20 + $1.26 + $2.90

= $22.16

Therefore, the cost of making the component should be compared to the price of buying the component at $22.16

Hedge funds report average returns in December that are higher than their average returns in other months. This phenomenon __________. I. is called the Santa effect II. often results from over generous valuation of illiquid assets III. appears stronger for lower-liquidity funds IV. can be explained by managers' attempts to inflate assets to collect higher performance bonuses Group of answer choices g

Answers

Answer:

I, II, III, and IV

Explanation:

A hedge fund is made up of relatively liquid assets that are used to improve performance though short selling, leverage and derivatives.

There is use of complex trading techniques, risk management, and portfolio construction.

Usually a spike in returns occurs during December, this is called the Santa effect.

Managers receive an incentive fee when there is a good past performance of hedge funds.

So during December they tend to inflate the value of hedge funds.

This results in stronger valuation for low liquidity funds

Different textbooks were grouped in various ways but in general the six main external environments are economy citing culture politics and law competition technology and natural environment yes or no

Answers

It is true that in general, the six main external environments are economy culture, politics and law, competition, technology and natural environment.

What are the factors in external environment?

An external environment is made up of all the outside factors or influences that have an impact on how a business operates. To maintain the flow of operations, the company must act or react.

The external environment is divided into two types: microenvironment and macroenvironment in which the micro environment consists of the factors that directly impact the operation of a company while the macro environment consists of general factors that a business typically has no control over.

Businesses should consider the following external environment factors which are political, economic, social and cultural, legal, technological, and environmental/natural.

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The eleven southern New Jersey stores of Elder Dry Goods have been hurt in recent months by a large increase in shoplifting losses. The company's risk manager concluded that while the frequency of shoplifting losses has been high, the severity remains relatively low.

Required:
Which risk management techniques would be most appropriate for this problem?

Answers

Answer: loss control and retention

Explanation:

The options to the question are:

A. retention

B) loss control and retention

C) transfer through insurance

D) avoidance

Based on the information given in the question, management techniques would be most appropriate for this problem is the loss control and retention.

Loss control also referred to as risk reduction can be done through the prevention of loss by reducing the probability of risk, thereby minimizing the loss. This will be vital in this scenario as the shoplifting will reduce.

You are considering a project that requires an initial investment of $98,000 with a cost of capital of 14%. You expect the project to have a five-year life, and produce cash flows of $19,000 in year 1, $32,000 in year 2, $64,000 in year 3, $26,000 in year 4 and $10,000 in year 5. What is this project’s net present value? Group of answer choices

Answers

Answer:

NPV= 7,076.59

Explanation:

Giving the following information:

Initial investment= $98,000

Cash flows:

Cf1= 19,000

Cf2= 32,000

Cf3= 64,000

Cf4= 26,000

Cf5= 10,000

To calculate the NPV, we need to use the following formula:

NPV= -Io + ∑[Cf/(1+i)^n]

∑[Cf/(1+i)^n]:

Cf1= 19,000/1.14= 16,666.67

Cf2= 32,000/1.14^2= 24,622.96

Cf3= 64,000/1.14^3= 43,198.18

Cf4= 26,000/1.14^4= 15,394.09

Cf5= 10,000/1.14^5= 5,193.69

∑[Cf/(1+i)^n]= 105,076.59

Now, the NPV:

NPV= -98,000 + 105,076.59

NPV= 7,076.59

cuáles son las tres partes de una fracción​

Answers

No Espanol English please?

In the Basic Solow Model without exogenous growth, if the population, and therefore the labor supply, doubles:_______

a. Steady state output per worker will fall by half.
b. Steady state output per worker will fall by more than half.
c. Steady state output per worker will fall by less than half.
d. Steady state output per worker will be unchanged.

Answers

Answer:

In the Basic Solow Model without exogenous growth, if the population, and therefore the labor supply, doubles steady state output per worker will be unchanged.

Explanation:

According to the given scenario options A, B and C are ruled out. Hence, the answer to the above question is option D. Steady state output per worker will be unchanged.

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The United Nations has never focused on the international rights of consumer
True or false

Answers

Answer:

true they have never focused on rights of consumers

Explanation:

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the following information pertains to Lightning Inc., at the end of December: Credit Sales $ 60,000 Accounts Payable 10,000 Accounts Receivable 7,000 Allowance for Uncollectible Accounts 400 credit Cash Sales 20,000 Lightning uses the aging method and estimates it will not collect 2% of accounts receivable not yet due, 10% of receivables up to 30 days past due, and 40% of receivables greater than 30 days past due. The accounts receivable balance of $7,000 consists of $3,500 not yet due, $2,000 up to 30 days past due, and $1,500 greater than 30 days past due. What is the appropriate amount of Bad Debt Expense

Answers

Answer:the appropriate amount of Bad Debt Expense=$870

Explanation:

Given that for Lightning Inc., at the end of December:  

Credit Sales $60,000

Accounts Payable 10.000

Accounts Receivable 7.000

Allowance for Uncollectible Accounts 400

creditCash Sales 20,000  

Using the  aging method and estimates it states that the following would be uncollectible

1. 2% of accounts receivable not yet due, $3500   which is

2 %  x 3500= $70

2. 10% of receivables less than 30 days past due, $2000 which is

  10% x 2000=$200

3. 40% of receivables greater than 30 days past due,$1500 which is

40% x$1500=$600

Appropriate amount of Bad Debt Expense= Allowance for Uncollectible Accounts =$70+$200+$600==$870

Therefore, Bad debt expense =$870  

Allowance for Uncollectible Accounts=$870

s

Project requirements are all the key players of a project that must be listed to ensure the project can begin.

True

False

Answers

"Project requirements are all the key players of a project that must be listed to ensure the project can begin."

True.

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