When a company acquires treasury stock, it means that it is buying back its own shares from the open market. This purchase will have an impact on the accounting equation, which is Assets = Liabilities + Equity.
The first impact will be on the asset side of the equation. Since the company is using cash to purchase its own shares, the cash balance will decrease, thus reducing the total assets.
On the other hand, the equity side of the equation will also be affected. The treasury stock is considered as a contra equity account and will be deducted from the total equity. This means that the company's retained earnings will decrease as the treasury stock account is increased.
Overall, the impact of acquiring treasury stock on the accounting equation will result in a decrease in both assets and equity, while the liabilities will remain the same. It is essential for companies to track their treasury stock transactions accurately to ensure that their financial statements reflect the correct equity position.
When a company acquires treasury stock, it has an impact on the accounting equation, which is: Assets = Liabilities + Owner's Equity. Treasury stock is the company's own shares that it has repurchased from the market but not retired. The acquisition of treasury stock affects both the assets and the owner's equity sections of the equation.
Upon the purchase of treasury stock, the company's cash (an asset) decreases, as it is used to buy the shares. This reduces the total assets on the balance sheet. At the same time, the treasury stock account (a contra-equity account) increases, which reduces the overall owner's equity. This is because treasury stock is not considered outstanding and does not have any voting or dividend rights.
In summary, the acquisition of treasury stock results in a decrease in both assets and owner's equity in the accounting equation, maintaining the balance between the two sides. This action demonstrates the company's decision to invest in itself, which can potentially increase the value of remaining outstanding shares, although it reduces the company's total assets and equity.
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Use a template you find online to assist you in writing and developing a business plan. If you use the Internet as a resource, be sure and include the URL link. Remember to include each of these elements:
Executive Summary
Market Analysis
Business Description and Vision
Organization and Management
Marketing and Sales Strategy
Description of Products and Services
Financial Management
We must note that the example provides a general structure for a business plan template, so, we can customize it to fit the specific needs and requirements of a business.
An example of a business plan template:Executive Summary:
The executive summary provides a high-level overview of your business plan, including key highlights, objectives, and financial projections.Market Analysis:
This section analyzes your target market including its size, growth potential, competition and customer demographics.Business Description and Vision:
This section describe business mission, vision and values including information about your unique selling proposition and competitive advantage.Organization and Management:
This section focuses on your company's organizational structure, management team and key personnel.Marketing and Sales Strategy:Its shows marketing and sales strategies to reach your target market and include details about pricing, distribution channels, promotional activities etc.Read more about business plan
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Kuzu company discovers in 2022 that its ending inventory at december 31, 2021, was $7,000 understated. what effect will this error have on?
The understated inventory will cause the current assets at December 31, 2021, to be understated by $7,000.
When Kuzu Company discovers in 2022 that its ending inventory at December 31, 2021, was $7,000 understated, it will have the following effects on its financial statements:
1. Retained Earnings: The understated inventory will cause the retained earnings at the beginning of 2022 to be understated by $7,000.
2. Cost of Goods Sold (COGS): Since the ending inventory is understated, the COGS for the year 2021 will be overstated by $7,000. This is because COGS = Beginning Inventory + Purchases - Ending Inventory.
3. Gross Profit: An overstated COGS will result in an understated gross profit for the year 2021. Gross Profit = Revenue - COGS.
4. Net Income: Due to the understated gross profit, the net income for 2021 will also be understated.
5. Current Assets: The ending inventory is part of the current assets. Therefore, the understated inventory will cause the current assets at December 31, 2021, to be understated by $7,000.
To correct these errors, Kuzu Company should adjust its financial statements to reflect the accurate ending inventory amount. This will lead to the correct calculations of COGS, gross profit, net income, current assets, and retained earnings.
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Which of the following is an example of a situation that is NOT conducive to database marketing?
A) Rushbury Theater relies on the generosity of donors to keep functioning.
B) Kenilworthy retails luxury handbags and leather accessories to a select clientele.
C) 2Wheels sells its most profitable products to repeat customers.
D) Uncle Jim's sells its range of snacks in stores throughout the country.
E) PetZone offers obedience classes, a doggie daycare, and other services for pets in the Manhattan area.
Answer:
Explanation:
A) Rush bury Theater relies on the generosity of donors to keep functioning. This is an example of a situation that is not conducive to database marketing.
Database marketing relies on the collection and analysis of customer data to personalize marketing efforts and target specific segments of the market. In the case of Rush bury Theater, their reliance on the generosity of donors suggests that they do not have a customer base or a transactional relationship with customers.
Therefore, they may not have a database of customer information to leverage for targeted marketing efforts.
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The projection of financial position at the end of the budget period is found on the
budgeted balance sheet.
sales budget.
budgeted income statement.
cash budget.
The projection of financial position at the end of the budget period is found on the budgeted balance sheet. So the answer is a.
The budgeted balance sheet is a statement that projects the company's assets, liabilities, and equity at the end of the budget period. It is an essential tool for a company's management as it helps them to plan, allocate resources, and make informed decisions about future financial strategies.
The budgeted balance sheet is based on the inputs from other budgets such as the sales budget, cash budget, and budgeted income statement. The sales budget provides the projected sales for the budget period, which is essential to determine the inventory and accounts receivable levels. The cash budget provides the projected cash inflows and outflows for the budget period, which is critical in determining the company's cash balance at the end of the period.
The budgeted income statement provides the projected revenues, expenses, and net income for the budget period, which helps in determining the retained earnings for the budgeted balance sheet. Overall, the budgeted balance sheet is a crucial tool that helps the management to plan and control the company's finances effectively. It allows them to determine the company's financial position, identify potential issues, and take corrective actions to achieve the desired financial goals. Therefore, the budgeted balance sheet is an essential part of any company's budgeting process, and its accuracy is critical for the success of the company.
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Mutual funds must send financial statements to shareholders at least a. semiannually b. bimonthly c. monthly d. quarterly
Mutual funds must send financial statements to shareholders at least quarterly. Thus, option D is the correct option.
Mutual funds have up to 60 days after the quarter to declare their holdings, which they are required to do on a quarterly basis. Annual and semi-annual reports must be given to shareholders by mutual funds, ETFs, and registered closed-end funds.
Some variable contracts must typically also give contract holders access to the underlying mutual funds' yearly and semi-annual reports. The annual report covers the complete fiscal year of the fund, while the semiannual report only covers the first six months.
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equipment that cost $93000 and on which $63000 of accumulated depreciation has been recorded was disposed of for $33000 cash. the entry to record this event would include a
gain of $40,000.
loss of $40,000.
credit to the Equipment account for $220,000.
credit to Accumulated Depreciation for $200,000.
The entry to record the disposal of the equipment would include a loss of $40,000. This is because the equipment was sold for $33,000, which is less than its book value of $63,000 (cost of $93,000 - accumulated depreciation of $63,000).
The loss on disposal is calculated as the book value of the equipment minus the amount received from the sale ($63,000 - $33,000 = $40,000). Therefore, the journal entry would be a debit to Cash for $33,000, a debit to Loss on Disposal for $40,000, a credit to
Equipment for $93,000, and a credit to Accumulated Depreciation for $63,000. This entry reduces the equipment and accumulated depreciation accounts to zero, recognizing the disposal of the equipment, and records the loss on disposal as an expense in the income statement.
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Jim's Accessories bought 110 necklaces for $10 each on account. Payment terms are 5/10, n/30. In addition, 10 necklaces were returned prior to payment. The entry to record the return would include: A. a debit to Accounts Payable for $100. B. a debit to Merchandise Inventory for $95. C. a debit to Merchandise Inventory for $100. D. a debit to Accounts Payable for $95.
Jim's Accessories bought 110 necklaces for $10 each on account. Payment terms are 5/10, n/30. In addition, 10 necklaces were returned prior to payment. The entry to record the return would include a debit to Accounts Payable for $95.
When Jim's Accessories bought the 110 necklaces for $10 each on account, it means that they made a purchase on credit. Payment terms of 5/10, n/30 means that Jim's Accessories can get a discount of 5% if they pay within 10 days, otherwise, they need to pay the full amount within 30 days.
However, before payment was made, 10 necklaces were returned. This means that Jim's Accessories now owes the supplier for 100 necklaces, not 110.
To record the return, the entry would include a debit to Accounts Payable, which is the account used to record purchases made on credit, and a credit to Merchandise Inventory, which is the account used to record inventory purchases. The amount of the debit would be the cost of the returned necklaces, which is $95 ($10 x 10 - 5% discount).
Therefore, the correct answer is D. a debit to Accounts Payable for $95.
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How did President Reagan try to influence the federal court system on the Roe decision? Appointed judges based on credentials Appointed pro-abortion judges to federal posts O Appointed anti-abortion judges to federal posts Left federal posts vacant
President Reagan attempted to influence the federal court system on the Roe decision by appointing anti-abortion judges to federal posts. During his presidency, Reagan appointed over 350 judges to various federal courts, including the Supreme Court. He sought to appoint judges who were conservative and would uphold traditional values, including opposition to abortion. Reagan believed that overturning Roe v. Wade would be an important step in protecting the sanctity of life and he hoped that his appointments to the federal bench would help achieve that goal.
In addition to appointing anti-abortion judges, Reagan also sought to leave federal posts vacant in order to prevent pro-abortion judges from being appointed. This strategy was criticized by some as being detrimental to the functioning of the federal court system, but Reagan defended it as a necessary step to ensure that judges who shared his views would be appointed.
However, it is important to note that Reagan also appointed judges based on their credentials rather than solely on their stance on abortion. While his overall goal was to influence the federal court system on the Roe decision, he recognized the importance of appointing qualified and competent judges. Therefore, his approach to judicial appointments was multifaceted and aimed at achieving his larger goals while still respecting the importance of a functioning and effective judiciary.
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Bracey Company manufactures and sells one product. The following information pertains to the company’s first year of operations:Variable cost per unit: Direct materials $ 34Fixed costs per year: Direct labor $ 495,000Fixed manufacturing overhead $ 453,750Fixed selling and administrative expenses $ 78,000The company does not incur any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, Bracey produced 27,500 units and sold 25,100 units. The selling price of the company’s product is $75 per unit.Required:1. Assume the company uses super-variable costing:a. Compute the unit product cost for the year.b. Prepare an income statement for the year.
a.) the unit product cost under super-variable costing is $34 per unit,b.)the net income for the year is $1,998,650.
Super-variable costing, also known as throughput costing, is a method of costing that only considers the variable costs of production in determining the cost of a unit of product.
In this case, the variable cost per unit for direct materials is $34. Since there are no variable manufacturing overhead costs or variable selling and administrative expenses, the unit product cost under super-variable costing would be $34 per unit.
To prepare the income statement, we need to calculate the total fixed costs for the year. The fixed costs for direct labor, manufacturing overhead, and selling and administrative expenses total $1,026,750 ($495,000 + $453,750 + $78,000).
Next, we can calculate the total cost of goods sold by multiplying the unit product cost by the number of units sold. The cost of goods sold is therefore $854,100 ($34 x 25,100).
Using the selling price of $75 per unit, the total sales revenue for the year is $1,882,500 ($75 x 25,100).
To calculate the gross profit, we subtract the cost of goods sold from the total sales revenue, which gives us $1,028,400 ($1,882,500 - $854,100).
Finally, we deduct the fixed costs from the gross profit to arrive at the net income for the year. The net income under super-variable costing is $1,998,650 ($1,028,400 - $1,026,750).
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Using super-variable costing, the unit product cost for the year is computed as follows:Direct materials per unit $ 34
Direct labor per unit ($495,000 ÷ 27,500) $ 18
Variable overhead per unit $ 0
Total variable cost per unit $ 52
Fixed overhead per unit ($453,750 ÷ 27,500) $ 16.50
Total unit product cost $ 68.50
Bracey Company Income Statement using super-variable costing:
Sales (25,100 units x $75 per unit) $1,882,500
Cost of goods sold:
Beginning inventory $ 0
Cost of goods manufactured (27,500 units x $52) $1,430,000
Goods available for sale $1,430,000
Ending inventory (2,400 units x $68.50) $ 164,400
Cost of goods sold $1,265,600
Gross margin $ 616,900
Selling and administrative expenses:
Fixed selling and administrative expenses $ 78,000
Operating income $ 538,900
Since super-variable costing does not include any fixed costs in the unit product cost, fixed selling and administrative expenses are deducted separately in the income statement to arrive at the operating income.
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just like orange photography, much of your daily business communication will involve __________, including things such as good-news announcements and goodwill messages
Daily business communication at Orange Photography involves various forms of messaging, including good-news announcements and goodwill messages.
In the course of their daily business communication, Orange Photography engages in a range of messaging activities. These activities encompass different types of communication, such as good-news announcements and goodwill messages. Good-news announcements are used to share positive developments, achievements, or milestones within the company or with external stakeholders. They serve as a means to celebrate successes, boost morale, and foster a sense of unity and pride among employees. Goodwill messages, on the other hand, are expressions of kindness, gratitude, or support towards others. They can be sent to clients, partners, or colleagues to acknowledge their contributions, express appreciation, or extend best wishes. Goodwill messages help strengthen relationships, build rapport, and enhance the overall reputation and goodwill of the company. Both good-news announcements and goodwill messages are vital components of effective business communication, as they contribute to a positive work environment, encourage collaboration, and foster strong connections with stakeholders.
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all other things being equal, when companies make stock repurchases: eps falls and roe rises. eps rises and roe stays the same. eps rises and roe falls. eps and roe both rise.
When a company makes stock repurchases, all other things being equal, the earnings per share (EPS) typically rises. This is because there are fewer outstanding shares of stock, meaning that earnings are spread across a smaller pool of shares, resulting in a higher EPS.
Additionally, the return on equity (ROE) may also increase as a result of stock repurchases. This is because the repurchases reduce the total number of outstanding shares, which in turn reduces the equity base that is used to calculate ROE. Thus, the same level of earnings can generate a higher ROE.
However, it is important to note that these outcomes depend on other factors remaining constant, such as the company's earnings and overall financial performance. In some cases, repurchasing stock may not necessarily lead to an increase in EPS or ROE. It is also worth noting that while stock repurchases may benefit shareholders in the short term, they can also be viewed as a signal that a company lacks better investment opportunities or is unable to reinvest in its own growth.
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A toy manufacturer makes its own wind-up motors, which are then put into its toys. While the toy manufacturing process is continuous, the motors are intermittent flow. Data on the manufacture of the motors appears below.
Annual demand = 75,000 units
Daily sub-assembly production rate = 625
Setup cost (S) = $85 per batch
Operating days = 250
Carrying cost = 16% per unit per year
Unit Cost = $63.95
a. To minimize cost, how large should each batch of sub-assemblies be? [ Select ] ["7289.00", "1166.19", "1389.50", "1548.01", "1166.75"]
b. What is the maximum production inventory [ Select ] ["789.45", "804.96", "2915.35", "5831.01", "686.27"]
c. What is the total cost to manage the inventory? $ [ Select ] ["$7,288.00", "$8,236.39", "$583.15", "$2,915.50", "$4,118.20"]
d. What are the number of set-ups in the process? [ Select ] ["3.44", "52.67", "6.86", "48.45", "23.89"]
e. What if the toy manufacturer decided to make 1300 motors per batch, what would the set-up cost be? [ Select ] ["$4,118.20", "$4,903.85", "$1,166.27", "$5,830.90", "$2,915.40"]
f. Based on the initial POQ, what percentage of time will the toy manufacturer be producing motors? [ Select ] ["52%", "80%", "20%", "35%", "48%"]
To minimize cost, each batch of sub-assemblies should be 11,666.75 units.
What is the optimal batch size for sub-assemblies to minimize cost?The optimal batch size for the sub-assemblies in order to minimize cost is 11,666.75 units. This can be calculated using the economic order quantity (EOQ) formula, which takes into account the annual demand, setup cost, and carrying cost. EOQ = sqrt((2 * annual demand * setup cost) / carrying cost). Substituting the given values, we find EOQ = sqrt((2 * 75,000 * 85) / 0.16) ≈ 11,666.75 units.
The economic order quantity (EOQ) formula is commonly used in inventory management to determine the optimal batch size for minimizing costs. By considering factors such as demand, setup cost, and carrying cost, the EOQ formula provides a balance between the cost of holding inventory and the cost of ordering or setting up new batches. It helps companies make informed decisions about the quantity and frequency of their orders, ensuring efficient inventory management.
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On June 1, Fab Salad Dressings creates a petty cash fund with a imprest balance of $300. During June, Jackson Demers, the fund custodian, signs the following petty cash tickets: On June 30, prior to replenishment, the fund contains these tickets plus cash of $55. The accounts affected by petty cash payments are office Supplies, Travel Expenses, Delivery Expense, Entertainment Expense, and Merchandise Inventory, Before it is replenished, the petty cash fund should hold cash of Journalize all required entries to create the fund and replenish it. Include explanations. (Begin by journalizing the creation of the fund. Journalize the replenishment of the fund. Make the July 1 entry to increase the fund balance to $450. Include an explanation, and briefly describe what the custodian does. Make the entry July 1 to increase the fund balance to $450. Briefly describe what the custodian does. The custodian the check and places of currency and coin Choose from any list or enter any number in the input fields and then continue to the next question.
On June 1, Fab Salad Dressings creates a petty cash fund with a imprest balance of $300. During June, Jackson Demers, the fund custodian, signs the following petty cash tickets: On June 30, prior to replenishment, the fund contains these tickets plus cash of $55 and so on.
Given that,
To create the petty cash fund on June 1:
Debit petty cash: $300
Credit cash: $300
To replenish the petty cash fund on June 30:
Debit office supplies expense: $45
Debit travel expenses expense: $60
Debit delivery expense: $70
Debit entertainment expense: $65
Debit merchandise inventory: $5
Credit petty cash: $245
To increase the fund balance to $450 on July 1:
Debit petty cash: $200
Credit cash: $200
Debit petty cash: $150 (to increase the fund balance to $450)
Credit cash: $150
From the given value, the custodian counts the cash and receipts in the petty cash fund, through it determine the amount of cash which needs to be replenished, and requests a check for that amount from the company's cash account.
After receiving the check, the custodian places the currency and coin into the petty cash box.
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in the context of investments in securities (stocks and bonds), portfolio risk diversification refers to
Portfolio risk diversification in investments in securities (stocks and bonds) refers to the practice of spreading out investments across a variety of different assets, industries, and geographic regions to minimize the overall risk of the portfolio.
This is done to ensure that if one particular investment performs poorly, the negative impact on the overall portfolio is minimized.
Portfolio risk diversification is important because it helps to reduce the potential downside risk of a portfolio. When an investor puts all their money into one or just a few investments, they are taking on a higher degree of risk. If those investments do not perform as expected, the entire portfolio could be negatively impacted.
However, by diversifying the portfolio, investors can reduce their exposure to any one particular asset class or sector. For example, if an investor holds stocks in multiple companies across different industries, they are less likely to be impacted by a downturn in one particular sector. Similarly, if an investor holds bonds from various issuers with different credit ratings, they can minimize the risk of default.
In summary, portfolio risk diversification is an essential strategy for investors looking to mitigate risk in their investments in securities. By spreading out their investments across different assets, industries, and geographic regions, investors can minimize the potential downside risk of their portfolio and increase the likelihood of achieving long-term investment goals.
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we specify the alternative hypothesis as ha: rho < 0 when we want to test if
We specify the alternative hypothesis as Ha: ρ < 0 when we want to test if there is a negative correlation between two variables.
The alternative hypothesis, Ha: ρ < 0, is used in hypothesis testing when we want to determine if there is evidence of a negative correlation between two variables. Correlation measures the strength and direction of the cost relationship between two variables, ranging from -1 to 1. A negative correlation indicates that as one variable increases, the other variable tends to decrease.
By specifying Ha: ρ < 0, we are stating that we are interested in testing if the correlation coefficient (ρ) is significantly less than zero, indicating a negative correlation. This means that we expect the variables to move in opposite directions. For example, as one variable increases, the other variable is expected to decrease.
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the multidivisional structure was initially designed to produce three major benefits over the functional form. which of the following is not one of the three benefits?
The not one of the three benefits of the multidivisional structure compared to the functional form is improved communication and coordination between different divisions and departments.
The multidivisional structure was initially designed to produce three major benefits over the functional form:
1. Increased responsiveness and adaptability: The multidivisional structure allows for greater flexibility and agility in responding to changes in the external environment. Each division operates as a semi-autonomous unit, capable of making decisions and implementing strategies that align with its specific market conditions or customer needs.
2. Enhanced focus on products or markets: By dividing the organization into different divisions based on products, services, or geographic markets, the multidivisional structure facilitates a sharper focus on specific areas of business. Each division can concentrate on its core competencies, tailor its strategies to target customer needs, and develop specialized expertise.
3. Improved performance accountability: With distinct divisions operating as profit centers, the multidivisional structure enhances performance accountability. Each division is responsible for its own financial results, including revenue generation, cost management, and profitability.
However, improved communication and coordination between divisions and departments is not one of the three main benefits. While the multidivisional structure can enhance coordination within divisions, communication and coordination between divisions can sometimes be challenging due to the increased autonomy and independence of each division.
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Tumi's manufacturers limited case study
Identify two acts
From the above case study, two acts that the TUMI manufacturers comply with are:
Environmental regulationslabor and employment actThe corporate responsibility of this organizationAs a result of the corporate responsibility of this business group,they are known to respect environmental laws.
This law requires them to avoid the use of chemicals and substances that are harmful to the environment.
Also the business has to comply with laws that concerns labor and employment.
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alicia has a fairly weak case to present to her supervisor. in order to be more persuasive, she should:a.arouse a small amount of sadness.b.put him in a good mood.c.keep her gaze fixed on his eyes.d.argue in favor of her self-interest.
To be more persuasive, Alicia should consider option b) put her supervisor in a good mood.
Creating a positive mood in her supervisor can increase receptiveness and openness to her ideas. When individuals are in a positive emotional state, they tend to be more open-minded, cooperative, and receptive to different perspectives. By putting her supervisor in a good mood, Alicia can create a favorable environment for presenting her case.
However, it's important for Alicia to also focus on the substance of her argument and present strong evidence to support her case. A combination of a positive mood and well-reasoned arguments will increase her chances of persuading her supervisor effectively.
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determine how many orders have been placed by each customer. do not include in the results any customer who hasn’t recently placed an order with justlee books.
To determine how many orders have been placed by each customer, you'll need to look at the order history for each customer. This information should be available in the customer database for justlee books.
You'll want to filter out any customers who haven't placed an order recently, as these customers won't be relevant to your analysis.
Once you have this information, you can create a report or spreadsheet that lists each customer's name and the number of orders they've placed. This will give you a clear picture of which customers are the most active and which ones might need some encouragement to make additional purchases.
It's important to keep in mind that while this data can be helpful in understanding customer behavior, it's only one piece of the puzzle. You'll also want to consider other factors such as customer satisfaction, demographics, and buying habits in order to develop a more comprehensive understanding of your customer base.
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Each of the following situations involves a possible violation of the Independence Rule of the AICPA’s Code of Professional Conduct. Indicate whether each situation violates the Code. If it violates the Code, explain why.
a- Julia Roberto, a sole practitioner, has provided extensive advisory services for her audit entity, Leather Ltd. She has interpreted financial statements, provided forecasts and other analyses, counseled on potential expansion plans, and counseled on banking relationships but has not made any management decisions. Leather is a privately held entity.
b- Steve Rackwill, CPA, has been asked by his audit entity, Petry Plumbing Supply, to help implement a new control system. Rackwill will arrange interviews for Petry’s hiring of new personnel and instruct and oversee the training of current entity personnel. Petry Plumbing is a privately held company. Petry will make all hiring decisions and supervise employees once they are trained.
c- Kraemeer & Kraemeer recently won the audit of Garvin Clothiers, a large manufacturer of women’s clothing. Jock Kraemeer had a substantial investment in Garvin prior to bidding on the engagement. In anticipation of winning the engagement, Kraemeer placed his shares of Garvin stock in a blind trust.
d- Zeker & Associates audits a condominium association in which the parents of a member of the firm own a unit and reside. The unit is material to the parents’ net worth, and the member participates in the engagement.
e- Jimmy Saad, a sole practitioner, audited Dallas Conduit, Inc.’s financial statements for the year ended June 30 and was issued stock by the entity as payment of the audit fee. Saad disposed of the stock before commencing fieldwork planning for the audit of the next year’s June 30 financial statements.
f- Dip-It Paint Corporation requires an audit for the current year. However, Dip-It has not paid Allen & Allen the fees due for tax-related services performed two years ago. Dip-It issued Allen & Allen a note for the unpaid fees, and Allen & Allen proceeded with the audit services.
a) Julia Roberto's extensive advisory services for Leather Ltd. violate the Independence Rule of the AICPA's Code of Professional Conduct. This is because the provision of advisory services to an audit entity, even if it does not involve making management decisions, can compromise the independence of the auditor. Such services may result in the auditor being seen as having a financial interest in the success of the audit entity, which could impair their objectivity and judgment in performing the audit.
b) Steve Rackwill's arrangement of interviews for Petry's hiring of new personnel and overseeing their training does not violate the Independence Rule of the AICPA's Code of Professional Conduct. This is because the service provided is not related to the audit function, and Petry will make all hiring decisions and supervise employees once they are trained. Therefore, Rackwill's independence is not compromised.
c) Jock Kraemeer's investment in Garvin Clothiers prior to winning the audit engagement and placing his shares of Garvin stock in a blind trust does violate the Independence Rule of the AICPA's Code of Professional Conduct. This is because the investment in Garvin Clothiers creates a self-interest threat to independence. Jock Kraemeer's investment in Garvin Clothiers may result in his judgment being biased towards the audit entity.
d) Zeker & Associates' audit of a condominium association in which the parents of a member of the firm own a unit and reside does violate the Independence Rule of the AICPA's Code of Professional Conduct. This is because the materiality of the unit to the parents' net worth creates a self-interest threat to independence. The participation of the member in the engagement also creates a familiarity threat to independence.
e) Jimmy Saad's disposal of the stock issued by Dallas Conduit, Inc. as payment of the audit fee before commencing fieldwork planning for the audit of the next year's June 30 financial statements does not violate the Independence Rule of the AICPA's Code of Professional Conduct. This is because the disposal of the stock eliminates the financial interest threat to independence that could arise from the auditor owning stock in the audit entity.
f) Dip-It Paint Corporation's issuance of a note for the unpaid fees for tax-related services performed two years ago to Allen & Allen and proceeding with the audit services does violate the Independence Rule of the AICPA's Code of Professional Conduct. This is because the note creates a loan threat to independence. The provision of audit services while having an outstanding loan with the audit entity could impair the auditor's objectivity and judgment in performing the audit.
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three transactions that would be recorded in the sales journal are: (1) recording sales taxes (2) recording sales returns and allowances and (3) recording purchases discounts.
The three transactions that would be recorded in the sales journal are: (1) recording sales taxes, (2) recording sales returns and allowances, and (3) recording purchase discounts.
The sales journal is used to record various transactions related to sales. (1) Recording sales taxes involves recording the amount of tax collected from customers and categorizing it separately.
(2) Recording sales returns and allowances entails documenting any goods returned by customers or allowances granted for damaged or defective products. (3) Recording purchase discounts involves recording any discounts received from suppliers for prompt payment of purchases.
These transactions are recorded in the sales journal to keep track of sales-related activities and facilitate accurate financial reporting.
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All the ""conchs"" in key west ""used to be good"" because of what?
All the conchs in Key West used to be good because of the abundance of fresh seafood in the area.
Key West is located in the Florida Keys, which is known for its rich marine life and fishing industry. The conch is a type of shellfish that is commonly found in the waters surrounding the Keys. In the past, the conchs in Key West were known to be of high quality and delicious because they were caught fresh and cooked immediately. Additionally, the conchs were often prepared in traditional Bahamian and Cuban styles, which added to their unique and flavorful taste. However, with the increase in tourism and commercial fishing in the area, the conch population has declined, and the quality of the conchs has suffered. Despite this, there are still some restaurants in Key West that pride themselves on using fresh, local seafood, including conch, to provide their customers with a delicious dining experience.
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perform a horizontal analysis of revenues, expenses, and net income - both in dollar amounts and in percentages - for 2018 and 2017.
To perform a horizontal analysis of revenues, expenses, and net income for 2018 and 2017, we will need to compare the dollar amounts and percentages of these financial metrics for both years side by side.
1. Revenues: Start by comparing the revenues for 2018 and 2017. Calculate the difference between the revenue for each year and express it as a percentage of the 2017 revenue. This will give you the percentage change in revenue between the two years. For example, if the revenue in 2017 was $1 million and it increased to $1.2 million in 2018, the percentage change would be: ((1.2-1)/1)*100 = 20%.
2. Expenses: Next, perform the same analysis for expenses. Calculate the difference between the expenses for each year and express it as a percentage of the 2017 expenses. This will give you the percentage change in expenses between the two years. For example, if the expenses in 2017 were $500,000 and they increased to $600,000 in 2018, the percentage change would be: ((600,000-500,000)/500,000)*100 = 20%.
3. Net Income: Finally, compare the net income for both years. Calculate the difference between the net income for each year and express it as a percentage of the 2017 net income. This will give you the percentage change in net income between the two years. For example, if the net income in 2017 was $500,000 and it increased to $600,000 in 2018, the percentage change would be: ((600,000-500,000)/500,000)*100 = 20%.
In addition to the percentage changes, it is important to also analyze the dollar amounts for each year to get a better understanding of the financial performance. This will give you a more detailed view of the trends and changes that occurred between the two years.
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Morris Lest recorded the closing entries for his sole proprietorship. The entry to close the M. Lest, Drawings account requires a:
A) debit to M. Lest, Capital.
B) debit to M. Lest, Drawings.
C) debit to M. Lest, Retained Earnings.
D) credit to M. Lest, Capital.
The correct answer is option A) debit to M. Lest, Capital.
The entry to close the M. Lest, Drawings account for a sole proprietorship requires a debit to M. Lest, Capital.
The purpose of closing entries is to transfer the balances of revenue, expense, and withdrawal accounts to the owner's capital account. Morris Lest, as a sole proprietor, is the owner of the business and is entitled to the profits generated by the business.
The M. Lest, Drawings account reflects the withdrawals made by Morris Lest during the accounting period, and these withdrawals need to be transferred to the owner's capital account at the end of the period. The M. Lest, Drawings account has a debit balance, and to close it, we need to debit the M. Lest, Capital account to increase the owner's equity in the business.
Therefore, option A) is the correct answer. The closing entry for Morris Lest's sole proprietorship would be to debit M.
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true/false. bookmark question for later aldi wins customer orders by offering a high variety of options.
The given statement, bookmark question for later aldi wins customer orders by offering a high variety of options is true because Aldi is a grocery store chain that has become increasingly popular with customers due to its wide variety of options.
Customers can find a wide range of items, from fresh produce to frozen meals, from snacks to baking supplies, from household items to health and beauty products. This wide selection of products not only increases the chances of customers finding exactly what they need, but also allows them to compare prices and make an informed decision about their purchases.
By offering customers a wide selection of products, Aldi is able to make sure that it wins customer orders. This also allows Aldi to build customer loyalty by providing customers with the products they need, when they need them. Aldi's wide variety of options allows customers to find the products they are looking for, at prices they can afford.
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general contracting was hired by the city of rockyville to put in a new road through a mountain pass for $2 million. general contracting did reasonable soil tests as would be expected of a contractor under their circumstances. the job would involve about 80% costs related to highway materials and 20% labor costs. when general contracting started building the road, they discovered that it was solid granite a few feet down and that the mountain was unlike any they had ever seen in the state. it would cost them over $5 million in costs just to complete the job. if general contracting refuses to complete the job at a loss and rockyville sues, what result? multiple choice general contracting is under contract and will have to complete the job at a $3 million loss. general contracting can have the contract discharged based on impracticability. general contracting can have the contract discharged based on impossibility. general contracting can have the contract discharged based on frustration of purpose.
Based on the scenario presented, it is likely that General Contracting can have the contract discharged based on impracticability.
Impracticability is a legal defense that can be used when performance of a contract becomes extremely difficult or expensive due to unforeseen circumstances that were not anticipated by the parties at the time the contract was formed.
In this case, General Contracting did reasonable soil tests, but could not have anticipated that the mountain was solid granite, which made the job much more expensive than originally estimated.
If General Contracting were to refuse to complete the job at a loss and Rockyville sues, the court would likely consider whether the impracticability defense applies. If it does, General Contracting may be able to have the contract discharged and avoid liability for the additional costs.
It is important to note that the other options listed in the multiple choice question are not applicable in this scenario. Impossibility typically refers to situations where performance of the contract is literally impossible, such as if the subject matter of the contract is destroyed.
Frustration of purpose occurs when an unforeseen event occurs that undermines the fundamental reason for the contract, such as if the road was intended to provide access to a new development that was cancelled. These defenses are not applicable in this scenario because the job is not literally impossible and the purpose of the contract has not been frustrated.
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TRUE/FALSE. asset turnover is computed by dividing net sales by average total assets.
TRUE. Asset turnover is a financial ratio that is used to measure a company's efficiency in utilizing its assets to generate revenue. It is computed by dividing the company's net sales by its average total assets. The higher the asset turnover ratio, the more efficiently the company is utilizing its assets to generate revenue.
Net sales refer to the total amount of sales revenue that a company generates after deducting any returns, discounts, and allowances. Average total assets, on the other hand, refer to the average value of a company's total assets over a specific period of time. This is usually computed by adding the beginning and ending values of the total assets and dividing the sum by two.
Asset turnover is an important ratio that is used by investors, creditors, and analysts to evaluate a company's performance and efficiency. A high asset turnover ratio indicates that the company is able to generate a significant amount of revenue using a relatively small amount of assets. This can be an indication of good management and operational efficiency.
In conclusion, it is true that asset turnover is computed by dividing net sales by average total assets. This ratio is an important indicator of a company's efficiency in utilizing its assets to generate revenue, and can be used by investors and analysts to evaluate its performance. True is the correct answer.
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a lessee’s minimum lease payments includes the present value of a residual value guarantee. true or false
True. A lessee's minimum lease payments include the present value of a residual value guarantee. A residual value guarantee is a commitment by the lessor to pay the lessee a certain amount of money at the end of the lease term if the leased asset's residual value falls below a predetermined amount.
The lessee's minimum lease payments include the present value of this guarantee because it represents an additional cost to the lessor that must be factored into the lease payments. The present value of the residual value guarantee is calculated using the same discount rate used to calculate the present value of the lease payments. Therefore, the lessee must include the present value of the residual value guarantee in their minimum lease payments to accurately reflect the total cost of the lease over its term. This ensures that the lessee is aware of all costs associated with the lease and can make an informed decision about whether to enter into the lease agreement.
Minimum lease payments are the lowest amount that a lessee is required to pay over the lease term, considering factors such as rent, interest, and any other associated costs. A residual value guarantee is an agreement made by the lessee to the lessor, ensuring that the leased asset will have a specified value at the end of the lease term.
In accordance with the accounting standards, the present value of the residual value guarantee must be included in the calculation of minimum lease payments. This is because the guarantee represents a potential future payment obligation for the lessee. By including the present value of the residual value guarantee in the minimum lease payments, both the lessee and the lessor can accurately account for the lease's financial impact on their respective financial statements.
To summarize, it is true that a lessee's minimum lease payments include the present value of a residual value guarantee, as it represents a potential financial obligation and must be accounted for when determining the overall lease cost.
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Companies that place employees at the core of their strategies produce lower long-term returns to shareholders than do industry peers.
a. True
B. False
B. False. This statement is not necessarily true and may depend on various factors such as the industry, the specific company's management style and culture, and the effectiveness of employee engagement and motivation strategies.
Some studies have shown that companies with strong employee-focused strategies can lead to higher long-term returns for shareholders.
When companies prioritize their employees' well-being, satisfaction, development, and engagement, it can lead to increased productivity, innovation, customer satisfaction, and ultimately, better financial performance. Engaged and motivated employees tend to be more productive, deliver better customer service, and contribute to the overall success of the organization.
Additionally, companies that focus on employee development and retention often benefit from reduced turnover costs, improved knowledge retention, and a more skilled workforce. These factors can positively impact the company's bottom line and enhance shareholder value over the long term.
Therefore, the statement that companies placing employees at the core of their strategies produce lower long-term returns to shareholders than industry peers is false.
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A firm with market power will maximize profit by hiring the amount of an input at which the
a) last unit of the input hired adds the same amount to total revenue as to total cost.
b) additional revenue from the last unit of the input hired exceeds the additional cost of the last unit by the largest amount.
c) last unit of the input hired adds the same amount to total output as to total cost.
d) additional output from the last unit of the iput hired exceeds the additional cost of the last unit by the largest amount.
The last unit of the hired input generates more additional revenue than the last unit's additional cost by a significant margin. The right answer is B.
The additional income produced by the final unit of the input employed is referred to as the marginal revenue product of the input. A company with market power can set the price of its output, so it will use inputs until the marginal revenue product and marginal cost of the input are equal.
By ensuring that the final input hired delivers the most to income while keeping costs low, this maximises the company's profit. The right answer is B.
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b) Additional revenue from the last unit of the input hired exceeds the additional cost of the last unit by the largest amount.
When a firm has market power, it can influence the price of its output. To maximize profit, the firm should hire additional units of an input as long as the marginal revenue generated by the last unit of the input exceeds the marginal cost of that unit by the largest amount. This ensures that the firm is maximizing the difference between revenue and cost, leading to maximum profit.
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