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ACCOUNTING The following accounts and related balances of Bluebird Designers, Inc., as of December 31, 2012, are arranged in no particular order. $$ \begin{matrix} \text{Cash.............................................. } & \text{\$ 45,000 } & \text{Interest expense.......................... } & \text{ \$ 16,300 }\\ \text{Accounts receivable, net................ } & \text{25,000 } & \text{Property, plant, and equipment, net....................... } & \text{359,000 }\\ \text{Paid-in capital in excess of par—common....................... } & \text{53,800 } & \text{Common stock, \$2 par, 500,000 shares authorized, 110,000 shares issued............. } & \text{ 220,000 }\\ \text{Accrued liabilities.......................... } & \text{22,000 } & \text{Prepaid expenses........................ } & \text{14,000 }\\ \text{Long-term note payable................} & \text{97,000 } & \text{Common stockholders’ equity, December 31, 2011.... } & \text{220,000 }\\ \text{Inventory.......................................} & \text{89,000 } & \text{Net income................................. } & \text{90,000 }\\ \text{Dividends payable......................... } & \text{9,000 } & \text{Total assets, December 31, 2011................ } & \text{500,000 }\\ \text{Retained earnings.......................... } & \text{?} & \text{Treasury stock, 8,000 shares at cost................ } & \text{23,000}\\ \text{Accounts payable.......................... } & \text{135,000 } & \text{Net sales..................................... } & \text{ 750,000}\\ \text{Trademarks, net............................ } & \text{9,000}\\ \text{Goodwill....................................... } & \text{18,000}\\ \end{matrix} $$ Prepare Bluebird’s classified balance sheet in the account format at December 31, 2012. Use DuPont analysis to compute rate of return on total assets and rate of return on common stockholders’ equity for the year ended December 31, 2012. Do these rates of return suggest strength or weakness? Give your reason. What additional information might help you make your decision? Verified answer
ACCOUNTING Skulas, Inc., manufactures and sells snowboards. Skulas manufactures a single model, the Pipex. In late 2017, Skulas’s management accountant gathered the following data to prepare budgets for January 2018: Skulas’s CEO expects to sell 2,900 snowboards during January 2018 at an estimated retail price of $650 per board. Further, the CEO expects 2018 beginning inventory of 500 snowboards and would like to end January 2018 with 200 snowboards in stock. Variable manufacturing overhead is$7 per direct manufacturing labor-hour. There are also $81,000 in fixed manufacturing overhead costs budgeted for January 2018. Skulas combines both variable and fixed manufacturing overhead into a single rate based on direct manufacturing labor-hours. Variable marketing costs are allocated at the rate of$250 per sales visit. The marketing plan calls for 38 sales visits during January 2018. Finally, there are $35,000 in fixed nonmanufacturing costs budgeted for January 2018.$ $$ \begin{matrix} \text{Materials and Labor Requirements} & \text{ }\\ \text{Direct materials} & \text{ }\\ \text{Wood} & \text{9 board feet (b.f.) per snowboard}\\ \text{Fiberglass} & \text{10 yards per snowboard}\\ \text{Direct manufacturing labor} & \text{5 hours per snowboard}\\ \end{matrix} $$ $$ \begin{matrix} \text{ } & \text{Direct Materials Inventories}\\ \text{ } & \text{Beginning Inventory 1/1/2018} & \text{Ending Inventory 1/31/2018}\\ \text{Wood} & \text{2.040 b.f.} & \text{1.540 b.f.}\\ \text{Fiberglass} & \text{1.040 yards} & \text{2.040 yards}\\ \end{matrix} $$ $$ Other data include: $$ $$ \begin{matrix} \text{ } & \text{2017 Unit Price} & \text{2018 Unit Price}\\ \text{Wood} & \text{\$ 32.00 per b.f.} & \text{\$ 34.00 per b.f.}\\ \text{Fiberglass} & \text{\$ 8.00 per yard} & \text{\$ 9.00 per yard}\\ \text{Direct manufacturing labor } & \text{\$ 28.00 per hour} & \text{\$ 29.00 per hour}\\ \end{matrix} $$ $The inventoriable unit cost for ending finished-goods inventory on December 31, 2016, is$374.80. Assume Skulas used a FiFO inventory method for both direct materials and finished goods. Ignore work in process in your calculations. 1. Prepare the January 2018 revenues budget (in dollars). 2. Prepare the January 2018 production budget (in units). 3. Prepare the direct material usage and purchases budgets for January 2018. 4. Prepare a direct manufacturing labor costs budget for January 2018. 5. Prepare a manufacturing overhead costs budget for January 2018. 6. What is the budgeted manufacturing overhead rate for January 2018? 7. What is the budgeted manufacturing overhead cost per output unit in January 2018? 8. Calculate the cost of a snowboard manufactured in January 2018. 9. Prepare an ending inventory budget for both direct materials and finished goods for January 2018. 10. Prepare a cost of goods sold budget for January 2018. 11. Prepare the budgeted income statement for Skulas, Inc., for January 2018. 12. What questions might the CEO ask the management team when reviewing the budget? Should the CEO set stretch targets? Explain briefly. 13. How does preparing the budget help Skulas's management team better manage the company? Verified answer ACCOUNTING The general ledger for Show biz Video shows the following at December 31: $$ \begin{array}{llll} \mathbf{\text{General Ledger }} & \text{ } & \text{ } & \text{ }\\ \text{101 Cash in Bank} & \text{$12,000$} & \text{207 Accts. Pay. -} & \text{ }\\ \text{105 Accts. Rec. - G. Cohen} & \text{$3,000$} & \text{New Media Suppliers} & \text{$3,000$}\\ \text{110 Accts. Rec. - J. Coletti} & \text{900} & \text{209 Accts. Pay. - Palace Films} & \text{$14,000$}\\ \text{113 Accts. Rec. - Flannery} & \text{$1,800$} & \text{301 Greg Failla, Capital} & \text{$33,775$}\\ \text{115 Accts. Rec. - Spring} & \text{ } & \text{305 Greg Failla, Withdrawals} & \text{$4,000$}\\ \text{Branch School District} & \text{$1,500$} & \text{310 Income Summary} & \text{\_\_\_}\\ \text{130 Office Equipment} & \text{$5,000$} & \text{401 Video Rental Revenue} & \text{$9,600$}\\ \text{135 Office Furniture} & \text{$8,000$} & \text{405 VCR Rental Revenue} & \text{$3,500$}\\ \text{140 Computer Equipment} & \text{$10,000$} & \text{501 Advertising Expense} & \text{$1,600$}\\ \text{145 Video Tapes} & \text{$20,000$} & \text{505 Equipment Repair} & \text{ }\\ \text{150 Video Equipment} & \text{$9,000$} & \text{Expense} & \text{$1,200$}\\ \text{201 Accts. Pay. - Broad Street} & \text{ } & \text{510 Maintenance Expense} & \text{400}\\ \text{Office Supply} & \text{400} & \text{520 Rent Expense} & \text{$1,000$}\\ \text{205 Accts. Pay.} & \text{ } & \text{530 Utilities Expense} & \text{375}\\ \text{Computer Horizons} & \text{15,500} & \text{ } & \text{ }\\ \end{array} $$ Using the preceding account names and balances: 1. Prepare the six-column work sheet. The period covered is one month. 2. Prepare the financial statements. Greg Failla invested $10,000 during the month. 3. Record the closing entries on page 12 of the general journal. 4. Post the closing entries. 5. Prepare a post-closing trial balance. Verified answer
ACCOUNTING Cora Manufacturing makes fashion products and competes on the basis of quality and leading-edge designs. The company has two divisions, clothing and cosmetics. Cora has $5,000,000 invested in assets in its clothing division. After-tax operating income from sales of clothing this year is$1,000,000. The cosmetics division has $12,500,000 invested in assets and an after-tax operating income this year of$2,000,000. The weighted- average cost of capital for Cora is 6%. The CEO of Cora has told the manager of each division that the division that “performs best” this year will get a bonus. 1. Calculate the ROI and residual income for each division of Cora Manufacturing, and briefly explain which manager will get the bonus. What are the advantages and disadvantages of each measure? 2. The CEO of Cora Manufacturing has recently heard of another measure similar to residual income called EVA. The CEO has the accountant calculate adjusted incomes for clothing and cosmetics and finds that the adjusted after-tax operating incomes are $634.200 and$2.181.600, respectively. Also, the clothing division has $470.000 of current liabilities, while the cosmetics division has only$380.000 of current liabilities. Using the preceding information, calculate the EVA for each division and discuss which manager will get the bonus. 3. What nonfinancial measures could Cora use to evaluate divisional performances? Verified answer Recommended textbook solutionsOther Quizlet setsRelated questionsWhat account do you find on a balance sheet report?The balance sheet includes information about a company's assets and liabilities. Depending on the company, this might include short-term assets, such as cash and accounts receivable, or long-term assets such as property, plant, and equipment (PP&E).
What account do you find on a balance sheet report quizlet?Recorded on the balance sheet (right side), include loans, accounts payable, mortgages, deferred revenues and accrued expenses. A company's debts or obligations which are due within one year. Appear on the company's balance sheet and include short term debt, accounts payable, accrued liabilities and other debts.
What items are found on a balance sheet quizlet?Assets, liabilities, stock and retained earnings are on the balance sheet. Accounts Payable (L), Inventory (A), Wages Payable (L), and Deferred Revenue (L) are found on the balance sheet. Expenses are on the income statement. Revenue minus Expenses equals Net Income.
What is reported on a balance sheet?Balance Sheet Basics
This financial statement details your assets, liabilities and equity, as of a particular date. Although a balance sheet can coincide with any date, it is usually prepared at the end of a reporting period, such as a month, quarter or year.
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