Question 1
Problem 15-9 Unguaranteed residual value; executory costs; sales-type lease [LO15-6, 15-8, 15-9] Rhone-Metro Industries manufactures equipment that is sold or leased. On December 31, 2013, Rhone-Metro leased equipment to Western Soya Co. for a four-year period ending December 31, 2017, at which time possession of the leased asset will revert back to Rhone-Metro. The equipment cost $580,000 to manufacture and has an expected useful life of six years. Its normal sales price is $628,656. The expected residual value of $40,000 at December 31, 2017, is not guaranteed. Equal payments under the lease are $174,000 (including $4,000 executory costs) and are due on December 31 of each year. The first payment was made on December 31, 2013. Collectibility of the remaining lease payments is reasonably assured, and Rhone-Metro has no material cost uncertainties. Western Soya?s incremental borrowing rate is 11%. Western Soya knows the interest rate implicit in the lease payments is 9%. Both companies use straight-line depreciation. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: 1. Show how Rhone-Metro calculated the $174,000 annual lease payments. 2. How should this lease be classified (a) by Western Soya Co. (the lessee) and (b) by Rhone-Metro Industries (the lessor)?e-Metro calculated the $174,000 annual lease payments. 3. Prepare the appropriate entries for both Western Soya Co. and Rhone-Metro on December 31, 2013. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) Western Soya Co. (Lessee) Record lease. Record cash payment. Rhone-Metro Journal Entries Record lease. Record cash Received. 5. Prepare the appropriate entries for both Western Soya and Rhone-Metro on December 31, 2014 (the second lease payment and depreciation). (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) Record depreciation expense. Record operating expense. Record cash payment. Record cash received. 6. Prepare the appropriate entries for both Western Soya and Rhone-Metro on December 31, 2017, assuming the equipment is returned to Rhone-Metro and the actual residual value on that date is $1,200. (If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Enter your answers in whole dollars.) Record operating expense. Record depreciation expense. Record the end of the lease. Also Record the end of the lease. Use the images for question 1 and 4
Question 2
1. In periods of rising prices, the inventory costing method which results in the inventory value on the balance sheet that is closest to current cost is the a. FIFO method. b. LIFO method. c. average cost method. d. tax method. 2. Two companies report the same cost of goods available for sale but each employs a different inventory costing method. If the price of goods has increased during the period, then the company using a. LIFO will have the highest ending inventory. b. FIFO will have the highest cost of good sold. c. FIFO will have the highest ending inventory. d. LIFO will have the lowest cost of goods sold. 3. If companies have identical inventoriable costs but use different inventory costing methods when the price of goods have not been constant, then the a. cost of goods sold of the companies will be identical. b. cost of goods available for sale of the companies will be identical. c. ending inventory of the companies will be identical. d. net income of the companies will be identical. 4. In a period of increasing prices, which inventory costing method will result in the lowest amount of income tax expense? a. FIFO b. LIFO c. Average Cost d. Income tax expense for the period will be the same under all assumptions. 5. The managers of Tong Company receive performance bonuses based on the net income of the firm. Which inventory costing method would result in the highest bonuses for the managers in periods of rising prices? a. LIFO b. Average Cost c. FIFO d. Physical inventory method
Question 3
Please help. 1. Process cost accounting is used when A) the production process is continuous. B) production is aimed at filling a specific customer order. C) dissimilar products are involved. D) costs are to be assigned to specific jobs. 2. In a process cost system, A) a W-I-P account is kept for each product. B) a materials requisition must identify the job on which the materials will be used. C) a W-I-P account is kept for each process. D) one W-I-P account is maintained for all the processes, similar to a job order cost system. 3. Department 1 of a two department production process shows: Units Beginning Work in Process 10,000 Ending Work in Process 15,000 Total units to be accounted for 40,000 How many units were started into production in Department 1? A) 25,000. B) 65,000. C) 55,000. D) 30,000. 4. Department 1 of a two department production process shows: Units Beginning Work in Process 10,000 Ending Work in Process 15,000 Total units to be accounted for 40,000How many units were transferred out to Department 2? A) 25,000. B) 65,000. C) 55,000. D) 30,000. 5. A department adds raw materials to a process at the beginning of the process and incurs conversion costs uniformly throughout the process. For the month of January, there were no units in the beginning work in process inventory 30,000 units were started into production in January and there were 8,000 units that were 45% complete in the ending work in process inventory at the end of January. What were the equivalent units of production for materials for the month of January? A) 33,600 equivalent units B) 25,600 equivalent units C) 30,000 equivalent units D) 38,000 equivalent units 6. A department adds raw materials to a process at the beginning of the process and incurs conversion costs uniformly throughout the process. For the month of January, there were no units in the beginning work in process inventory 30,000 units were started into production in January and there were 8,000 units that were 45% complete in the ending work in process inventory at the end of January.What were the equivalent units of production for conversion costs for the month of January? A) 33,600 equivalent units B) 25,600 equivalent units C) 30,000 equivalent units D) 38,000 equivalent units 7. When manufacturing overhead costs are assigned to production in a process cost system, they are debited to A) the Finished Goods Inventory account. B) Cost of Goods Sold. C) a Manufacturing Overhead account. D) the Work in Process account. 8. In the month of June, a department had 7,000 units in beginning work in process that were 90% complete. During June, 14,000 units were transferred into production from another department. At the end of June there were 1,000 units in ending work in process that were 30% complete. Materials are added at the beginning of the process while conversion costs are incurred uniformly throughout the process.How many units were transferred out of the process in June? A) 20,000 units B) 21,000 units C) 22,000 units D) 15,000 units 9. In the month of June, a department had 7,000 units in beginning work in process that were 90% complete. During June, 14,000 units were transferred into production from another department. At the end of June there were 1,000 units in ending work in process that were 30% complete. Materials are added at the beginning of the process while conversion costs are incurred uniformly throughout the process.The equivalent units of production for materials for June was A) 20,000 equivalent units. B) 21,000 equivalent units. C) 22,000 equivalent units. D) 20,300 equivalent units. 10. In the month of June, a department had 7,000 units in beginning work in process that were 90% complete. During June,14,000 units were transferred into production from another department. At the end of June there were 1,000 units in ending work in process that were 30% complete. Materials are added at the beginning of the process while conversion costs are incurred uniformly throughout the process.The equivalent units of production for conversion costs for June was A) 20,000 equivalent units. B) 21,000 equivalent units. C) 20,700 equivalent units. D) 20,300 equivalent units.
Question 4
200?300 words and 1 page showing calculations Details: Your CEO has limited knowledge of management accounting but of course, is vitally interested in forecasting profitability under different scenarios. He asked you, the management accountant, to begin your report by answering a few basic questions he's always wondered about. He has also given you some data to review and has asked you to report on the expected profitability under some given scenarios. Company Data ?Company's average selling price (SP) per unit = $20 ?Product's variable cost per unit = $10 ?Company's budgeted fixed costs for the upcoming year are expected to be $500,000 You must complete the following: ?Write a report of 200?300 words including the following: ?What are two situations when the CEO would use CVP analysis? ?In simple terms, ?what is contribution margin? ?do managers want contribution margin to be a bigger or smaller figure? Why? ?What kind of firm needs to have a large contribution margin to be profitable: a firm with low or high SG&A expenses? Why? ?Give an example of such a firm. ?Include at least 1 page of calculations for the following scenario analyses: ?What is the break-even point, in units and dollars, for the basic data? ?The sales department thinks it could sell the product at a slightly higher price of $25/unit, but if the price is raised, it may lose 10% of sales volume in units. ?What would the expected profitability be if this higher selling price/unit in fact occurred? ?Based on this, should they raise the price? Why? Why not? ?As an alternative, increasing the sales price to $25/unit, the CEO is thinking of hiring a new VP of Marketing to ease his own workload at a total of $80,000 compensation and benefit cost. ?How much more volume, above the break-even unit volume determined earlier, would have to be sold to cover this additional cost? ?Obviously, the CEO does not want everyone to work hard just to break even. Using just to the original data given, ?what unit volume must be sold for the firm to earn $250,000 of profit? Please submit your assignment. This needs to be original work please,Just let me know if this is a go or not, if not I need to get started on this asap. Thanks
Question 5
Ratio analysis - comprehensive problem, 2008 data. This problem is based on the 2008 annual report of Intel Corporation. a. Compute the following profitability measures for the year ended December 27, 2008. 1. Return on investment, based on net income (perform a DuPont analysis). 2. Return on equity, based on net income. 3. Price/earnings ratio. Use $14.18 as the year end market price. 4. Dividend yield. 5. Dividend payout ratio. b. Compute the following liquidity measures at December 27, 2008: 1. Working capital. 2. Current ratio. 3. Acid-test ratio. c. Compute the following activity measures for the year ended December 27, 2008: 1. Number of days sales in accounts receivable, based on a 365 day year. 2. Number of days' sales in inventory, based on a 365 day year. 3. Accounts receivable turnover. 4. Inventory turnover. 5. Turnover of net property, plant, and equipment. d. Compute the following financial leverage measures at December 27, 2008: 1. Debt ratio. 2. Debt/equity ratio. e. Compute the following physical measures of Intel's profitability at December 27, 2008: 1. Net revenues per employee. 2. Operating income per employee. (Hint: The number of employees at year-end is disclosed on page 685 of the Intel annual report in the appendix.) b.,How long does it usually take for the expert tutor to get back with the potential client?,Ok thanks - I submitted 3 questions. Are you evaluating all of them? Please advise. If, you accept them, can you have me an answer by 8:00 P. M. Central time tonight. You answered one of my questions last week and it was correct. Once again, thanks in advance for your cooperation concerning this very important matter.,Thank You!
