Question: Aster Company is considering an investment in

> Isle Corp., a merchandising company, reports the following balance sheet at December 31. To prepare a master budget for January, February, and March, use the following information. a. The company’s single product is purchased for $30 pe

> Connick Company sells its product for $22 per unit. Its actual and budgeted sales follow. All sales are on credit where 40% is collected in the month of the sale, and the remaining 60% is collected in the month following the sale. Merchandise purchases c

> Sony Stereo began operations in March. March sales were $180,000 and purchases were $100,000. The beginning cash balance for April is $3,000. Sony’s owner approaches the bank for an $80,000 loan to be made on April 2 and repaid on June

> HOG Company makes its product for $60 per unit and sells it for $130 per unit. The sales staff receives a commission of 10% of sales. Its June income statement follows. Management expects June’s results to be repeated in July, August, a

> Dimsdale Sports, a merchandising company, reports the following balance sheet at December 31. To prepare a master budget for January, February, and March, use the following information. a. The company’s single product is purchased for $

> Aztec Company sells its product for $180 per unit. Its actual and budgeted sales follow. All sales are on credit. Collections are as follows: 30% is collected in the month of the sale, and the remaining 70% is collected in the month following the sale. M

> Oneida Company’s operations began in August. August sales were $215,000 and purchases were $125,000. The beginning cash balance for September is $5,000. Oneida’s owner approaches the bank for a $100,000 loan to be made

> The management of Zigby Manufacturing prepared the following balance sheet for March 31. To prepare a master budget for April, May, and June, management gathers the following information. a. Sales for March total 20,500 units. Budgeted sales in units fol

> Santana Rey expects second quarter 2022 net income of Business Solutions’s line of computer furniture to be the same as the first quarter’s net income (reported below) without any changes in strategy. Sales were 120 de

> Merline Manufacturing makes its product for $75 per unit and sells it for $150 per unit. The sales staff receives a commission of 10% of sales. Its December income statement follows. Management expects December’s results to be repeated

> Use Apple’s financial statements in Appendix A to answer the following. 1. How many shares of Apple common stock are issued and outstanding at (a) September 28, 2019, and (b) September 29, 2018? 2. What is the total amount of cash dividends paid to commo

> Rivera Co. sold 20,000 units of its only product and reported income of $20,000 for the current year. During a planning session for next year’s activities, the production manager notes that variable costs can be reduced 25% by installin

> The following costs result from the production and sale of 12,000 LEGO sets manufactured by LEGO Company for the year ended December 31. The LEGO sets sell for $20 each. Required 1. Prepare a contribution margin income statement for the year. 2. Compute

> Sun Co.’s monthly data for the past year follow. Management wants to use these data to predict future variable and fixed costs. Required 1. Estimate both the variable costs per unit and the total monthly fixed costs using the high-low

> Patriot Co. manufactures flags in two sizes, small and large. The company has total fixed costs of $240,000 per year. Additional data follow. The company is considering buying new equipment that would increase total fixed costs by $48,000 per year and re

> Burchard Company sold 40,000 units of its only product for $25 per unit this year. Manufacturing and selling the product required $525,000 of fixed costs. Its per unit variable costs follow. For the next year, management will use a new material, which wi

> Henna Co. produces and sells two products, Carvings and Mementos. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 50,000 units of each product. Incom

> Astro Co. sold 20,000 units of its only product and reported income of $25,000 for the current year. During a planning session for next year’s activities, the production manager notes that variable costs can be reduced 40% by installing

> The following costs result from the production and sale of 1,000 drum sets manufactured by Tight Drums Company for the year ended December 31. The drum sets sell for $500 each. Required 1. Prepare a contribution margin income statement for the year. 2.

> Milano Co. manufactures backpacks in two sizes, small and large. The company has total fixed costs of $520,000 per year. Additional data follow. The company is considering buying new equipment that would increase total fixed costs by $50,000 per year and

> Hip-Hop Co. manufactures and markets several products. Management is considering the future of one product, electronic keyboards, that has not been as profitable as planned. Because this product is manufactured and marketed independently of the other pro

> Take a step back in time and imagine Apple in its infancy as a company. The year is 1976, and Steve Wozniak, Steve Jobs, and Ron Wayne are the organizing partners. Required 1. Read the history of Apple from 1976 to 1980 at en.wikipedia.org/wiki/Apple I

> Connor Company sold 30,000 units of its only product for $28 per unit this year. Manufacturing and selling the product required $225,000 of fixed costs. Its per unit variable costs follow. For the next year, management will use a new material, which will

> Stam Co. produces and sells two products, BB and TT. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 50,000 units of each product. Income statements

> Alden Co.’s monthly data for the past year follow. Management wants to use these data to predict future variable and fixed costs. Required 1. Estimate both the variable costs per unit and the total monthly fixed costs using the high-lo

> Manufactures baseball bats. In addition to its work in process inventories, the company maintains inventories of raw materials and finished goods. It uses raw materials as direct materials in production and as indirect materials. Its factory payroll cost

> Based on customer interest in February, Santana expands her computer workstation furniture business to include mass production of standardized desks and chairs. She uses the weighted average method of process costing for these products. Desks are made in

> Belda Co. makes organic juice in two departments: Cutting and Blending. Direct materials are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company uses the FIFO method of process costing. Data

> Harson Co. manufactures a single product in two departments: Forming and Assembly. Information for the Forming department for May follows. 1. Compute equivalent units of production for both direct materials and conversion. 2. Compute cost per equivalent

> Ho Chee makes ice cream in two sequential processes: Mixing and Blending. Direct materials enter production at the beginning of each process. The following information is available regarding its March inventories. The following additional information des

> Refer to the information in Problem 20-3B. Assume that Switch uses the FIFO method of process costing. The units started and completed for January total 210,000. Required 1. Prepare the Cutting department’s production cost report for January using FIFO

> Switch Co. manufactures a single product in two departments: Cutting and Assembly. Information for the Cutting process for January follows. Required 1. Prepare the Cutting department’s production cost report for January using the weigh

> Use the table below and Apple’s financial statements in Appendix A to answer the following. 1. Compute times interest earned for each of the three years shown. 2. Is Apple in a good or bad position to pay interest obligations? Assume an

> Assumed data for Samsung and Apple follow. Required 1. Compute the degree of operating leverage for each company. 2. Based on the degree of operating leverage, which company’s income will increase more from an increase in unit sales?

> Brun Company produces its product through two processing departments: Mixing and Baking. Information for the Mixing department follows. Required 1. Prepare the Mixing department’s production cost report for November using the weighted

> Abraham Company uses weighted average process costing to account for its production costs. The company has two production processes. Conversion is added evenly throughout each process. Direct materials are added at the beginning of the first process. Add

> Dengo Co. makes a trail mix in two departments: Roasting and Blending. Direct materials are added at the beginning of each process, and conversion costs are added evenly throughout each process. The company uses the FIFO method of process costing. Octobe

> ComPro is designing a new smart phone. Each unit of this new phone will require $285 of direct materials; $10 of direct labor; $30 of variable overhead; $5 of variable selling, general, and administrative costs; $14 of fixed overhead costs; and $16 of fi

> Sung Company produces two models of its product with the same machine. The machine has a capacity of 200 hours per month. The following information is available.

> Micron Manufacturing produces telescopes. This month it produced 50 telescopes at a cost of $9,000. These telescopes were damaged in storage. Management has identified three alternatives for these telescopes. 1. They can be sold as scrap to a wholesaler

> MAX produces and sells power adapters. Its contribution margin income statement follows. A potential customer offers to buy 10,000 units for $5.80 each. These sales would not affect the company’s sales through its normal channels. Detai

> Ace produces and sells energy drinks. Its contribution margin income statement follows. A potential customer offers to buy 50,000 units for $3.00 each. These sales would not affect the company’s sales through its normal channels. Detail

> Matsu Company’s annual accounting period ends on October 31. The following information concerns the adjusting entries that need to be recorded as of that date. Entries can draw from the following partial chart of accounts: Cash; Accounts Receivable; Offi

> The accounting records of Tama Co. show the following assets and liabilities as of December 31 for Year 1 and for Year 2. Required 1. Prepare balance sheets for the business as of December 31 for Year 1 and Year 2. Hint: Report only total equity on the

> Refer to Apple’s financial statements in Appendix A to answer the following. 1. What percent of the original cost of Apple’s Property, Plant and Equipment account remains to be depreciated as of (a) September 28, 2019, and (b) September 29, 2018? Assume

> Use the information in Problem 1-3B to prepare the current year-end balance sheet for Audi Company.

> Use the information in Problem 1-3B to prepare the statement of owner’s equity for Audi Company for the current year ended December 31. Hint: The owner invested $100 cash during the year.

> As of December 31 of the current year, Audi Company’s records show the following. Required Prepare the income statement for Audi Company for the current year ended December 31.

> Archer Foods is considering whether to overhaul an old freezer or replace it with a new freezer. Information about the two alternatives follows. Management requires a 10% rate of return on its investments. Alternative 1: Keep the old freezer and have it

> Milan Co. is considering two alternative investment projects. Each requires a $300,000 initial investment. Project A is expected to generate net cash flows of $90,000 per year over the next five years. Project B is expected to generate net cash flows of

> Lopez Co. can invest in one of two alternative projects. Project Y requires a $240,000 initial investment for new machinery with a four-year life and no salvage value. Project Z requires a $240,000 initial investment for new machinery with a three-year l

> Project A requires a $240,000 investment for new machinery with a four-year life and no salvage value. The project yields the following annual results. Cash flows occur evenly within each year. Required 1. Compute Project A’s annual net

> Cortino Company is planning to add a new product to its line. To manufacture this product, the company needs to buy a new machine at a $300,000 cost with an expected four-year life and a $20,000 salvage value. Additional annual information for this new p

> King Company builds custom order fulfillment centers for large e-commerce companies. On June 1, the company had no inventories of work in process or finished goods but held the following raw materials. On June 3, the company began work on Job 450 for Enc

> Use Apple’s financial statements in Appendix A to answer the following. 1. What is the amount of Apple’s accounts receivable as of September 28, 2019? 2. Compute Apple’s accounts receivable turnover as of September 28, 2019. 3. Apple’s most liquid assets

> At the beginning of the year, Paella Company’s manager estimated total direct labor cost to be $1,500,000. The manager also estimated the following overhead costs for the year. For the year, the company incurred $725,000 of actual over

> Perez Company shows the following costs for three jobs worked on in September. Additional Information a. Raw Materials Inventory has an August 31 balance of $150,000. b. Raw materials purchases in September are $400,000, and total factory payroll cost i

> At the end of May, the job cost sheets at Cool Pool show the following costs accumulated on three jobs. Additional information a. Job 8 was started in April, and the following costs were assigned to it in April: direct materials, $8,000; direct labor, $

> A manufacturing company reports the following information. Required 1. Compute raw materials inventory turnover for the most recent two years. 2. Is the current year change in raw materials inventory turnover ratio favorable or unfavorable? 3. Compute d

> The following year-end information is taken from the December 31 adjusted trial balance and other records of Best Bikes. Required Identify each cost as either a product cost or a period cost. If a product cost, classify it as direct materials, direct la

> Selected comparative financial statement information of Bluegrass Corporation follows. Required 1. Compute each year’s current ratio. Round ratios to one decimal. 2. Express the income statement data in common-size percentâ€

> Selected comparative financial statements of Tripoli Company follow. Required 1. Compute trend percent’s for all components of both statements using 2015 as the base year. Round percent’s to one decimal. Analysis Com

> Refer to the information in Problem 16-1B. Required Prepare the operating activities section of the statement of cash flows using the direct method for the current year.

> Salt Lake Company’s current-year income statement and selected balance sheet data at December 31 of the current and prior years follow. Required Prepare the operating activities section of the statement of cash flows using the indirect

> Valdez issues $450,000 of 13%, four-year bonds dated January 1, 2021, that pay interest semiannually on June 30 and December 31. They are issued at $493,608 when the market rate is 10%. Required 1. Prepare the January 1 journal entry to record the bonds

> Use Apple’s financial statements in Appendix A to answer the following. 1. Identify the total amount of cash and cash equivalents for fiscal years ended (a) September 28, 2019, and (b) September 29, 2018. 2. Compute cash and cash equivalents as a percent

> Refer to the bond details in Problem 14-3B. Required 1. Compute the total bond interest expense over the bonds’ life. 2. Prepare an effective interest amortization table like the one in Exhibit 14B.2 for the bonds’ life. 3. Prepare the journal entries t

> Refer to the bond details in Problem 14-4B. Required 1. Prepare the January 1 journal entry to record the bonds’ issuance. 2. Determine the total bond interest expense to be recognized over the bonds’ life. 3. Prepare an effective interest amortization

> The following information is available for both Atlas Company and Bryan Company at the current year-end. Required 1. Compute the debt-to-equity ratio for both companies. 2. Which company has the riskier financing structure?

> On January 1, JCCC borrows $130,000 cash by signing a 4-year, 5% installment note. The note requires four equal payments consisting of accrued interest and principal on December 31 for each of the next four years. Required 1. Compute the amount of each

> On January 1, 2021, Gordon borrows $150,000 cash from a bank by signing a three-year installment note bearing 10% interest. The note requires equal payments of $60,316 each year on December 31. Required 1. Complete an amortization table for this install

> Gomez issues $240,000 of 6%, 15-year bonds dated January 1, 2021, that pay interest semiannually on June 30 and December 31. They are issued at $198,494 when the market rate is 8%. Required 1. Prepare the January 1 journal entry to record the bonds’ iss

> Ripken Company issues 9%, five-year bonds dated January 1, 2021, with a $320,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $332,988. Their annual market rate is 8% on the issue date. Required 1. Calculate

> Romero issues $3,400,000 of 10%, 10-year bonds dated January 1, 2021, that pay interest semiannually on June 30 and December 31. The bonds are issued at a price of $3,010,000. Required 1. Prepare the January 1 journal entry to record the bonds’ issuance

> Lasu, Ramirez, and Toney, who share income and loss in a 2:1:2 ratio (in percents: Lasu, 40%; Ramirez, 20%; and Toney, 40%), plan to liquidate their partnership. At liquidation, their balance sheet appears as follows. Required Prepare journal entries fo

> Gibbs, Hook, and Chan are partners and share income and loss in a 5:1:4 ratio (in percent’s: Gibbs, 50%; Hook, 10%; and Chan, 40%). The partnership’s capital balances are as follows: Gibbs, $606,000; Hook, $148,000; and Chan, $446,000. Gibbs decides to

> Refer to Apple’s financial statements in Appendix A. 1. What amount of accounts payable did Apple report on (a) September 28, 2019? (b) On September 29, 2018? 2. Compute days’ payable outstanding for fiscal year ended (a) September 28, 2019, and (b) Sep

> Cook, Jing, and Schwartz formed the CJS Partnership by making investments of $144,000, $216,000, and $120,000, respectively. They predict annual partnership net income of $240,000 and are considering the following alternative plans of sharing income and

> Albin, Peters, and Ramsey invested $164,000, $98,400, and $65,600, respectively, in a partnership. During its first calendar year, the firm earned $270,000. Required Prepare the entry to close the firm’s Income Summary account as of its December 31 year

> Bell and Green are forming a partnership. Bell invests $104,000 and Green invests $156,000. The partners agree that Bell will work one-fourth of the total time devoted to the partnership and Green will work threefourths. They have discussed the following

> Jen Novinska and Jeff Quinlan form a partnership. Novinska contributes the following items (at market value). Prepare the partnership’s journal entry to record Novinska’s investment.

> The July transactions of Acorn Industries are described in Problem 7-2B. Required 1. Prepare a general journal, purchases journal, and cash payments journal. Number all journal pages as page 3. Enter the transactions of Acorn Industries that should be j

> Acorn Industries completes these transactions during July of the current year (the terms of all its credit sales are 2/10, n/30). July 1 purchased $6,500 of merchandise on credit from Teton Company, terms 2/10, n/30. 3 Issued Check No. 300 to The Weekly

> Grassley Company completes these transactions during November of the current year (terms for all its credit sales are 2/10, n/30). Nov. 1 purchased $5,058 of office equipment on credit from Burn Supply, terms n/30. 2 Borrowed $88,500 cash from Wisconsin

> Shepard Company sold 4,000 units of its product at $100 per unit during the year and incurred operating expenses of $15 per unit in selling the units. It began the year with 840 units in inventory and made successive purchases of its product as follows.

> Seneca Co. began the year with 6,500 units of product in its January 1 inventory costing $35 each. It made four purchases of its product during the year as follows. The company uses a periodic inventory system. On December 31, a physical count reveals th

> Refer to the information in Problem 6-3B and assume the periodic inventory system is used. Required 1. Compute cost of goods available for sale and the number of units available for sale. 2. Compute the number of units in ending inventory. 3. Compute th

> Use Apple’s financial statements in Appendix A to answer the following. Required 1. What amount of inventories did Apple report as a current asset (a) on September 28, 2019? (b) On September 29, 2018? 2. Inventories make up what percent of total assets

> Aloha Company uses a perpetual inventory system. It entered into the following calendar-year purchases and sales transactions. (For specific identification, units sold consist of 80 units from beginning inventory, 300 units from the May 6 purchase, and 1

> The adjusted trial balance for Amara Co. on December 31 of the current year follows. Petra Amara invested $40,000 cash in the business during the year. The P. Amara, Capital account balance was $52,800 on December 31 of the prior year. Required 1. Prepar

> Following is the unadjusted trial balance for Alonzo Institute as of December 31. The Institute provides one-on-one training to individuals who pay tuition directly to the business and offers extension training to groups in off-site locations. Shown afte

> Edge Company produces two models of its product with the same machine. The machine has a capacity of 176 hours per month. The following information is available. Required 1. Determine the contribution margin per machine hour for each model. 2. How many u

> Hip Manufacturing produces denim clothing. This year it produced 3,000 denim jackets at a cost of $90,000. These jackets were damaged in the warehouse during storage. Management identified three alternatives for these jackets. 1. Jackets can be sold as s

> Haver Company currently pays an outside supplier $15 per unit for a part for one of its products. Haver is considering two alternative methods of making the part. Method 1 for making the part would require direct materials of $5 per unit, direct labor of

> FURY produces and sells skateboards. Its contribution margin income statement follows. A potential customer offers to buy 10,000 units for $42.00 each. These sales would not affect the company’s sales through its normal channels. Detail

> JART manufactures and sells underwater markers. Its contribution margin income statement follows. A potential customer offers to buy 50,000 units for $3.20 each. These sales would not affect the company’s sales through its normal channe

> Techcom is designing a new smart phone. Each unit of this new phone will require $230 of direct materials; $10 of direct labor; $22 of variable overhead; $18 of variable selling, general, and administrative costs; $30 of fixed overhead costs; and $10 of

> Seminole Co. began the year with 23,000 units of product in its January 1 inventory costing $15 each. It made four purchases of its product during the year as follows. The company uses a periodic inventory system. On December 31, a physical count reveals

> Refer to Apple’s financial statements in Appendix A to answer the following. Required 1. Assume that the amounts reported for inventories and cost of sales reflect items purchased in a form ready for resale. Compute the net cost of goods purchased for t

> Arnos Company’s annual accounting period ends on December 31. The following information concerns the adjusting entries to be recorded as of that date. Entries can draw from the following partial chart of accounts: Cash; Accounts Receivable; Office Suppli