Budgeting Basics for Students: Winter 2024 Guide
29. Nailed It! Construction (Nailed It! or the “Company”), an SEC registrant, is a construction...
Nailed It! Construction
Nailed It! Construction (Nailed It! or the “Company”), an SEC registrant, is a
construction company that manufactures commercial and residential buildings. On March
1, 20X1, the Company entered into an agreement with a customer, Village Apartments, to
construct a residential apartment building for a fixed price of $1.5 million. The Company
estimates that it will incur costs of $1 million to complete construction of the apartment
building. The apartment building will only transfer to Village Apartments once the
construction of the entire building is complete. In addition, Village Apartments has
various design requirements that would require Nailed It! to incur significant costs to
rework the building prior to selling it to a customer other than Village Apartments.
To construct the apartment building, Nailed It! acquires standard materials that it
regularly uses in construction contracts for both residential and commercial buildings.
These materials are used to manufacture generic component parts for inclusion in Village
Apartments’ residential buildings. These standard materials remain interchangeable with
other items until they are deployed in a Village Apartments building. The Company has
made the following purchases and incurred the following costs throughout the
construction progress:
• As of June 30, 20X1, in total, Nailed It! has purchased $75,000 of component
parts. As of June 30, 20X1, $25,000 of component parts remain in inventory and
$50,000 have been integrated into the project. Further, Nailed It! has incurred
$12,500 of direct costs to integrate the component parts into the Village
Apartments construction project during the three months ended June 30, 20X1.
• During the three months ended September 30, 20X1, Nailed It! purchased an
additional $500,000 of component parts ($575,000 in total). Of the $575,000 of
component parts, $325,000 remain in inventory and $200,000 have been
integrated into the project during the three months ended September 30, 20X1.
During the three months ended September 30, 20X1, Nailed It! incurred an
additional $50,000 of direct costs to integrate the component parts into the Village
Apartments construction project.
• As of September 30, 20X1, Nailed It! determined that the project was over budget
and revised its cost estimate from $1 million to $1.25 million.
• As of December 31 20X1, the construction project was completed. During the
three months ended December 31, 20X1, Nailed It! purchased an additional
$425,000 of generic component parts ($1 million in total). Of the $1 million
component parts, $0 remain in inventory and $750,000 were integrated into the
project during the three months ended December 31, 20X1. Nailed It! has
incurred $187,500 of direct costs to integrate the component parts into the Village
Apartments construction project during the three months ended December 31,
30. Check my work GLO205-Based on Problem 2-2A Aracel Engineering Aracel Engineering completed the follo
Engineering Aracel Engineering completed the following transactions in the month of June. Using the following transactions, record journal entries, create financial statements, and assess the impact of each transaction on the financial statements. 1 Jenna Aracel, the owmer, invested $100,e00 cash, office equipment with a value of $5,000, and $60,000 of drafting equipment to launch the company in exchange for common stock. 2 The company purchased land worth $49,00e for an office by paying $6,300 cash and signing $42,700. 3 The company purchased a portable building with $55,eee cash and moved it onto the land acquired on June 2 4 The company paid $3,000 cash for the premium on an 18-month insurance po1icy. 5 The company completted and delivered a set of plans for a client and collected $6,200 cash. 6 The company purchased $20,e00 of additional drafting equipment by paying $9,500 cash and signing a long-term note payable for $10,500. 7 The company completed $14,0e0 of engineering services for a client. This amount is to be received in 30 days. 8 The company purchased $1,150 of additional office equipment on credit. 9 The company completed engineering services for $22,e00 on credit. Jun. Jun. a long-term note payable for Jun. Jun. Jun. Jun. Jun. Jun. Jun. Jun. 10 The company received a bill for rent of equipment that was used on a recently completed job. The $1,333 rent cost must be paid within 30 days. Jun. 12 The company collected $7,0ee cash in partial payment from the client described billed on June 9. 14 The company paid $1,200 cash for wages to a drafting assistant. Jun. Jun. 17 The company paid $1,150 cash to settle the account payable created in on June 8. 20 The company paid $925 cash for minor maintenance of its drafting uapen Jun. Jun. Jun. 28 The company paid $1,200 cash for wages to a drafting assistant. Jun. 29 The company paid $2,500 cash for advertisenents on the web during June. 23 The company paid $9,480 cash in dividends. St Retained Earnings Impact on Income Statement General Ledger General Journal Balance Sheet Trial Balance Requirement Equity Every journal entry must keep the accounting equation in balance. Prepare the journal entries for each of the transactions, entering the debits before the credits. Each transaction is automatically posted to the General Ledger and the Trial Balance as soon as you click "Record Entry". Show less & View journal entry worksheet View transaction list. Credit Debit Account Title Date No 100.000 Cash Jun 01 5 of 5 Next
31. On Nov. 30, 2013, the end of the fiscal year, the following information is available to enable...
On Nov. 30, 2013, the end of the fiscal year, the following information is available to enable you to prepare Edgar Detoya Company's adjusting entries:
A. The Supplies account showed a beginning balance of P21,740. Purchases during the year were P45,260. The ending inventory revealed supplies on hand of P13,970.
B. The Prepaid Insurance account showed the following on November 30:
Beginning Balance ---------------P35,800
July 1-----------------------------------P42,000
October 1----------------------------P72,720
The beginning balance represented the unexpired portion of a one-year policy purchased in September 2012. The July 1 entry represented a new one-year policy, and the Oct. 1 entry is additional coverage in the form of a three-year policy
C. The following table contains the cost and annual depreciation for buildings and equipment, all of which Detoya Company purchased before the current year:
D. On September 1, the company completed negotiations with a client and accepted an advance of P168,000 for services to be performed next year. The P168,000 was credited to Unearned Service Revenues.
E. The company calculated that as of November 30, it had earned P40,000 on a P110,000 contract that would be completed and billed in January
F. Among the liabilities of the company is a note payable in the amount of P3,000,000. On November 30, the accrued interest on this note amounted to P150,000,
G. Assume that on, December 3, a Saturday, the company, which is on a six-day workweek, will pay its regular salaried employees P123,000.
H. On November 29, the company completed negotiations and signed a contract to provide services to a new client at an annual rate of P175,000.
32. 1. Which of the following statements is true regarding Fixed and Variable Costs?: A. Fixed costs are
1. Which of the following statements is true regarding Fixed and Variable Costs?: A. Fixed costs are constant in total, & variable costs are constant per unit. B. Both costs are constant when considered on a per-unit basis. C. Both costs are constant when considered on a total basis. D. Variable costs are constant in total, & fixed costs are constant per unit. 2. Which of the following is most typically a variable manufacturing cost?: A. Depreciation costs computed using the straight-line method B. Direct labor costs C. Factory rent D. The President’s salary 3. Utilities are typically a ‘mixed cost,’ containing both a fixed and variable element. Given the following history of electric bills and machine hours, use the “High/Low Method” to determine the variable cost component per machine hour: Machine Cost Hours July $4,200 21,900 August $4,000 20,300 September $4,100 21,100 October $3,700 18,200 November $3,900 18,500 December $4,500 23,400 A. Approx. $12.50 per machine hour B. Approx.
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1. Which of the following statements is true regarding Fixed and Variable Costs?:
A. Fixed costs are constant in total, & variable costs are constant per unit.
B. Both costs are constant when considered on a per-unit basis.
C. Both costs are constant when considered on a total basis.
D. Variable costs are constant in total, & fixed costs are constant per unit.
2. Which of the following is most typically a variable manufacturing cost?:
A. Depreciation costs computed using the straight-line method
B. Direct labor costs
C. Factory rent
D. The President’s salary
3. Utilities are typically a ‘mixed cost,’ containing both a fixed and variable element. Given the following history of electric bills and machine hours, use the “High/Low Method” to determine the variable cost component per machine hour:
Machine
Cost Hours
July $4,200 21,900
August $4,000 20,300
September $4,100 21,100
October $3,700 18,200
November $3,900 18,500
December $4,500 23,400
A. Approx. $12.50 per machine hour
B. Approx. $.15 per machine hour
C. Approx. $4.86 per machine hour
D. Approx. $.08 per machine hour
4. If a calculator will sell for $42 each, the Variable Costs to produce it are $24 per unit, and the Fixed Costs per month are $39,600, then how many calculators must be sold per month to Break Even?
A. 943 units
B. 1,650 units
C. 2,200 units
D. 3,300 units
5. Which of the following products is more likely to be costed and controlled under a Job Order Costing system, rather than a Process Costing system?
A. Cans of paint
B. Limousines
C. Bottles of beer
D. Household light bulbs
6. The “Margin of Safety” in dollars can be calculated by:
A. Sales – (Fixed Expenses / Contribution Margin Ratio)
B. Sales – (Fixed Expenses / Variable Expense per unit)
C. Sales – (Fixed Expenses + Variable Expenses)
D. Sales – Net Operating Income
7. If a company’s Degree of “Operating Leverage” is 4.5, then an increase in Sales of 5% will cause your Net Operating Income to increase by:
A....
33. 2. One-third of the unearned rent revenue was recognized during the quarter. Unearn
2. One-third of the unearned rent revenue was recognized during the quarter. Unearned Rent Revenue 9,900 Rent Revenue 60,000 Prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Additional accounts are: Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expense. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
34. DeLong Corporation was organized on January 1, 2017. It is authorized to issue 14,000 shares of 8...
DeLong Corporation was organized on January 1, 2017. It is authorized to issue 14,000 shares of 8%, $100 par value preferred stock, and 538,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year.
Jan. | 10 | Issued 75,000 shares of common stock for cash at $4 per share. | |
Mar. | 1 | Issued 5,050 shares of preferred stock for cash at $110 per share. | |
Apr. | 1 | Issued 24,000 shares of common stock for land. The asking price of the land was $92,000. The fair value of the land was $87,500. | |
May | 1 | Issued 83,500 shares of common stock for cash at $4.50 per share. | |
Aug. | 1 | Issued 10,000 shares of common stock to attorneys in payment of their bill of $38,000 for services performed in helping the company organize. | |
Sept. | 1 | Issued 11,000 shares of common stock for cash at $7 per share. | |
Nov. 1 Issued 2,000 shares of preferred stock for cash at $109 per share. Post to the stockholders’ equity accounts. Prepare the paid-in capital section of stockholders’ equity at December 31, 2017. |
35. The Lakeshore Hotel’s guest-days of occupancy and custodial
The Lakeshore Hotel’s guest-days of occupancy and custodial supplies expense over the last seven months were;
Guest-days is a measure of the overall activity at the hotel. For example, a guest who stays at the hotel for three days is counted as three guest-days.
Required:
1. Using the high-low method, estimate a cost formula for custodial supplies expense.
2. Using the cost formula you derived above, what amount of custodial supplies expense would you expect to be incurred at an occupancy level of 11,000guest-days?
36. Jack Shellenkamp owns and manages a computer repair service, whi
Jack Shellenkamp owns and manages a computer repair service, which had the following trial balance on December 31, 2009 (the end of its fiscal year).
Summarized transactions for January 2010 were as follows:
1. Advertising costs, paid in cash, $1,000.
2. Additional repair parts inventory acquired on account $4,000.
3. Miscellaneous expenses, paid in cash, $2,000.
4. Cash collected from customers in payment of accounts receivable $14,000.
5. Cash paid to creditors for accounts payable due $15,000.
6. Repair parts used during January $4,000.
7. Repair services performed during January: for cash $6,000; on account $9,000.
8. Wages for January, paid in cash, $3,000.
9. Jack’s drawings during January were $3,000.
Instructions
(a) Open T accounts for each of the accounts listed in the trial balance, and enter the opening balances for 2010.
(b) Prepare journal entries to record each of the January transactions. (Omit explanations.)
(c) Post the journal entries to the accounts in the ledger. (Add accounts as needed.)
(d) Prepare a trial balance as of January 31,2010.
37. 1. Outline the industry-standard techniques and methods that should be used to complete the...
1. Outline the industry-standard techniques and methods that should be used to complete the following routine calculations:
a. Goods and Services Tax (GST)
b. Simple interest
c. Compound interest
d. Basic loan calculations
e. Straight line depreciation
2. Identify the typical computational errors that can occur when performing calculations, and for each outline explain the ways in which you would check for these errors
3. Identify the equipment and software required to conduct routine financial calculations, and discuss their key features
38. Blane Company has the following data: Total Sales $800,000 Total Variable Costs $30
Blane Company has the following data: Total Sales $800,000 Total Variable Costs $300,000 Fixed Costs $200,000 Units sold 50,000 units What will operating income be if units sold double to 100,000 units?