Proops Company has a weighted-average unit contribution margin of $30 for its two products, Drew and Carey. Expected sales for Proops are 40,000 Drews and60,000 Careys. Fixed expenses are $1,800,000. At the expected sales level, Proops' net income will be:
Parallel Consulting Ltd began 1 Jan 2006 with 200,000 shares of $1 par value common stock outstanding. The stockholders' equity is as follows: Stockholders' equity Capital stock: Ordinary share, $1 par value, 1,000,000 shares authorized, 200,000 shares issued and outstanding $200,000 Additional paid-in capital: Sh
1. Gaw Company owns 15% of the common stock of Teal Corporation and used the fair-value method to account for this investment. Teal reported net income of $110,000 for 2002 and paid dividends of $60,000 on October 1, 2002. How much income should Gaw recognize on this investment in 2002? A) $16,500 B) $ 9,000 C) $25,500
On January 1, 2003, Bangle Company purchased 30% of the voting common stock of Sleat Corp. for $1,000,000. Any excess of cost over book value was assigned to goodwill. During 2003, Sleat paid dividends of $24,000 and reported a net loss of $140,000. What is the balance in the investment account on December 31, 2003? A) $950
Cashen Co. paid $2,400,000 to purchase all of the common stock of Janex Corp. on January 1, 2001. Janex's reported earnings for 2003 totaled $432,000, and it paid $120,000 in dividends during the year. The amortization of allocations related to the investment was $24,000. Cashen's net income, not including the investment, was
Use the following information to answer Questions 21 and 22. On January 1, 2002, Cale Corp. paid $1,020,000 to purchase Kaltop Co. Kaltop maintained separate incorporation. Cale used the equity method to account for the investment. The following information is available for Kaltop's assets, liabilities, and stockholders' e
When Jolt Co. acquired 75% of the common stock of Yelts Corp. Yelts owned land with a book value of $70,000 and a fair market value of $100,000. What amount should have been reported for the land on a consolidated balance sheet, assuming the Economic Unit Concept was used? A $70,000 B $75,000 C $85,000 D $92,500
Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair market value of Float's net assets was $1,850,000, and the book value was $1,500,000. What is the dollar amount of Noncontrolling Interest which should appear on a balance sheet prepared immediately after consolidation according to the Econom
Perch Co. acquired 80% of the common stock of Float Corp. for $1,600,000. The fair market value of Float's net assets was $1,850,000, and the book value was $1,500,000. What amount of Goodwill should have been recognized according to the Economic Unit Concept? A $150,000 B $250,000 C $0 D $120,000 E $170,000
Reisen Travel offers helicopter service from suburban towns to John F. Kennedy International Airport in New York City. Each of its 10 helicopters makes between 1,000 and 2,000 round-trips per year. The records indicate that a helicopter that has made 1,000 round-trips in the year incurs an average operating cost of $300 per roun
Provide appropriate supporting analysis for your answer choice. Abbey Company, which has only one product, has provided the following data concerning its most recent month of operations: Selling price $129 Units in beginning inventory 0 Units produced 6,300 Units sold 6,100 Units in ending inventory 200
Sharon, a single taxpayer, has taxable income of $100,000, a regular tax liability of $26,560, a positive AMT adjustment due to limitations on itemized deductions of $20,000, and tax preferences of $25,000 in 2006. What is Sharon's AMT for 2006? Can you please show me step by step how this is calculated?
Cade Company produces a single product. The cost of producing and selling a single unit of this product at the company's normal activity level of 40,000 units per month is as follows: Direct materials $38.80 Direct labor $9.70 Variable manufacturing overhead $2.30 Fixed manufacturing overhead $18.10 Variable se
Explain the advantages and disadvantages of a cafeteria plan?Please explain and provide a reference.
Maenhout Corporation uses the FIFO method in its process costing system. Operating data for the Casting Department for the month of September appear below: Units Percentage Complete Beginning work in process inventory
During its fiscal year, Morey Corporation had outstanding 600,000 shares of $6.50 preferred stock and 2,000,000 shares of uncommon stock. Morey's net income for the year was $19,550,000. The company also had granted stock options to employees for 200,000 shares of common stock at $10 per share. The average price of the compan
Background information A company has two major businesses that it operates. One business manufactures and sells unicycles for commercial use in circuses, etc. (total sales of $150M), and the other sells bicycles to the public (total sales of $20M). The unicycle business occupies 75,000 square feet of the manufacturing wareho
The Congress Company has identified two methods for producing playing cards. One method involves using a machine having a fixed cost of $10,000 and variable costs of $1.00 per deck of cards. The other method would use a less expensive machine (fixed cost = $5,000), but it would require greater variable costs ($1.50 per deck of
How are the tax benefits of net operating losses (NOL) disclosed on financial statements? Which is more beneficial to an organization, a NOL carry-forward or a NOL carry-back? Why? When would a company decide to forego a carry-back?
Why are there differences between taxable and financial income? What are some examples of permanent and temporary differences? Why do these differences exist? How do they affect the financial statements?
In January 2004, Wilkinson, Inc., acquired 20 percent of the outstanding common stock of Bremm, Inc., for $700,000. This investment gave Wilkinson the ability to exercise significant influence over Bremm. Bremm's assets on that date were recorded at $3,900,000 with liabilities of $900,000. Any excess of cost over book value of t
When should a consolidated entity recognize a goodwill impairment loss? a. If both the market value of a reporting unit and its associated implied goodwill fall below their respective carrying values. b. Whenever the market value of the entity declines significantly. c. If the market value of a reporting unit falls b
During 2006, Edgemont Corporation had revenues of $230,000 and expenses, including income taxes, of $190,000. On December 31, 2005, Edgemont had assets of $350,000, liabilities of $80,000, and capital stock of $210,000. Edgemont paid a cash dividend of $25,000 in 2006. No additional stock was issued.
What are some examples that lead to economic profit or loss, but not necessarily a recognizable event for accounting purposes?
Assume that the following data describe the condition of the banking system: Total Reserves: $200 billion Transactions Deposits: $800 billion Cash held by the public: $100 billion Reserve Requirement: 0.20 a) How large is the money supply (M1)? b) How large are the required reserves? c) How large are excess re
A firm has the following income statement. What is its net operating profit after taxes (NOPAT)? Sales $1,000 Costs 600 Depreciation 250 EBIT $ 150 Interest expense 50 EBT $ 100 Taxes (40%) 40 Net income $ 60
I need to identify and describe at least three of the largest variable expenses for Microsoft and Novell, Inc's most recent fiscal years. Explain the financial impact each of those expenses has had on the companies' margins and profitability.
Eastern Telecom is trying to decide whether to increase its cash dividend immediately or use the funds to increase its future growth rate. It will use the dividend valuation model. P=d/k-g P= Price of the stock today D1= Dividend at end of the first year D x (1 x g) D0= Dividend today K= Required rate o
Owner's equity accounts for a company are below: common stock ($1 par value) $ 10,000 Capital Surplus 180,000 Retained earnings 586,000 Total owners equity $776,500 a. If the company's stock sells for $25 per share and a 10 % stock dividend
A bank sells a customer $500 of American Express traveler's checks for which the bank collects from the customer $505. (The bank charges 1% fee for this service.) How does the bank record this transaction? How does this transaction affect American Express' balance sheet?