Problem 12-04A The income statement of Kingbird, Inc. is presented here. Kingbird, Inc. Income Statement For the Year Ended November 30, 2020 Sales revenue $7,465,900 Cost of goods sold Beginning inventory $1,868,500 Purchases 4,450,600 Goods available for sale 6,319,100 Ending inventory 1,331,800 Total cost of goods sold 4,987,300 Gross profit 2,478,600 Operating expenses 1,120,500 Net income $1,358,100 Additional information: 1. Accounts receivable increased $205,900 during the year, and inventory decreased $536,700. 2. Prepaid expenses increased $179,800 during the year. 3. Accounts payable to suppliers of merchandise decreased $345,700 during the year. 4. Accrued expenses payable decreased $105,800 during the year. 5. Operating expenses include depreciation expense of $95,300. Prepare the operating activities section of the statement of cash flows using the direct method

Answer:

Cash Flow From Operating Activities

Cash Receipt from Customers                       $7,260,000

Cash Paid to Suppliers and Employees       ($6,294,700)

Cash Provided by Operating Activities            $965,300

Explanation:

Step 1 : Cash Paid to Suppliers and Employees Calculation

Cost of goods sold                                         $4,987,300

Add Operating expenses                                $1,120,500

Total                                                                 $6,107,800

Adjustments :

Depreciation expense                                        $95,300

Decrease in Inventory                                     ($536,700)

Increase in Prepaid Expenses                          $179,800

Decrease in Accounts Payable                        $345,700

Decrease in Accrued Expense Payable          $105,800

Cash Paid to Suppliers and Employees       $6,294,700

Step 2 : Cash Receipt from Customers Calculation

Sales revenue                                                $7,465,900

Less Increase in Accounts receivable          ($205,900)

Cash Receipt from Customers                      $7,260,000

Exercise 11-7 Sell or Process Further Decisions [LO11-7] Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the split-off point total $300,000 per quarter. For financial reporting purposes, the company allocates these costs to the joint products on the basis of their relative sales value at the split-off point. Unit selling prices and total output at the split-off point are as follows: Product Selling Price Quarterly Output A $ 10.00 per pound 11,000 pounds B $ 4.00 per pound 17,300 pounds C $ 16.00 per gallon 2,200 gallons Each product can be processed further after the split-off point. Additional processing requires no special facilities. The additional processing costs (per quarter) and unit selling prices after further processing are given below: Product Additional Processing Costs Selling Price A $ 48,250 $ 14.10 per pound B $ 68,055 $ 9.10 per pound C $ 23,780 $ 23.10 per gallon Required: 1. What is the financial advantage (disadvantage) of further processing each of the three products beyond the split-off point

"Which of the following is true? Airfreight A. has lower transporting rates than trucks. B. efficiently delivers all types of goods. C. serves many more locations than trucks. D. is best for goods that are heavy relative to their sales value, such as iron ore. E. can help reduce inventory costs."

Use the following information of VPI Co. to prepare a statement of cash flows for the year ended December 31 using the indirect method.
Cash balance at prior year-end $43,600 Gain on sale of machinery $2,900
Increase in inventory 8,600 Cash received from sale of
machinery 11,300
Depreciation expense 7,600 Increase in accounts payable 3,300
Cash received from issuing stock 11,600 Net income 59,000
Cash paid for dividends 4,600 Decrease in accounts
receivable 6,600

Frasquita acquired equipment from the manufacturer on 6/30/2021 and gave a noninterest-bearing note in exchange. Frasquita is obligated to pay $550,000 on 4/30/2022 to satisfy the obligation in full. If Frasquita accrued interest of $15,000 on the note in its 2021 year-end financial statements, what amount would it have recorded the equipment for on 6/30/2021

Compute the current ratio for the fiscal years ending January 31, 2016, and February 1, 2015. a-2. Compute the quick ratio for the fiscal years ending January 31, 2016, and February 1, 2015. a-3. Compute the amount of working capital for the fiscal years ending January 31, 2016, and February 1, 2015. a-4. Compute the percentage change in working capital from the prior year for the fiscal years ending January 31, 2016, and February 1, 2015. a-5. Compute the percentage change in cash and cash equivalents from the prior year for the fiscal years ending January 31, 2016, and February 1, 2015.

How does implementing change affect strategic relationship management?
A. It upsets the balance between the needs of key positions.
ОО
B. There is very little impact on relationship management.
O C. Change doesn't impact internal relationships.
O D. It makes fewer resources available to satisfy stakeholders.

Why is it important for everyone in an organization to have the opportunity to
contribute to the mission statement?
A. So it defines expected outcomes clearly
B. So that it will be accepted and used by employees
C. So employees know the organization's history
O D. So the organization can track progress toward meeting its goals

Suppose that the global crude oil price has risen due to refinery breakdowns caused by middle-east politics and warfare. Crude oil is an input in the gasoline production. At the same time, the demand for driving and, therefore, the demand for gasoline has also risen in the United States. You can accurately predict that the domestic price of gasoline is:_______

Choose all of the items that are examples of fiscal policy.
a. There is an increase in income tax rates.
b. The Federal Reserve purchases bonds on the open market.
c. The estate tax is repealed.
d. Government increases military spending.
e. Public money is used to build a high-speed train that connects Los Angeles and Las Vegas.
f. The Federal Reserve increases the money supply by decreasing the reserve-ratio requirement.
g. To help domestic firms, government sets a quota on the number of goods that can be imported.

There are some excellent free personal finance apps available: Mint, GoodBudget, Mvelopes, BillGuard, PocketExpense, HomeBudget, and Expensify. After using Mint, you realize you need to pay off one of your high interest loans to reduce your interest expense. You decide to discount a $5,250, 345-day note at 3% to your bank at a discount rate of 4.5% on day 210. What are your proceeds

Suppose the Kalamazoo Brewing Company (KBC) currently sells its microbrews in a seven-state area: Illinoise, Indiana, Michigan, Minnesota, Mississippi, Ohio, and Wisconsin. The company's marketing department has collected data from its distributers in each state. This data consists of the quantity and price (per case) of microbrews sold in each state, as well as the average income (in thousands of dollars) of consumers living in various regions of each state. The data for each state are available via the link below--please note there are multiple tabs at the bottom of the spreadsheet, each refers to one of the seven states selling the Kalamazoo Brewing Company’s microbrews.
Excel Data File
Quantity Price Income
575 31.26 33.95
674 30.69 35.51
616 31.54 28.78
183 27.41 30.44
501 29.75 31.28
578 29.48 33.77
590 28.94 38.31
445 28.17 34.01
603 28.58 32.53
713 28.57 31.69
337 30.06 32.26
230 29.36 31.57
403 28.81 32.75
383 32.52 29.48
568 32.02 35.91
698 32.91 34.85
826 28.45 34.06
789 26.85 38.92
645 30.49 35.94
601 31.72 38.05
467 31.23 36.48
429 31.28 37.61
552 28.89 38.29
553 31.13 36.9
562 27.52 39.22
352 30.02 34.21
611 31.38 33.97
346 29.08 38.53
354 28.8 34.4
401 27.64 34.01
253 30.47 34.24
524 30.97 38.29
211 32.85 34.66
666 30.11 41.38
468 29.48 32.14
585 28.41 29.16
578 29.96 35.05
656 30.46 37.11
571 32.86 32.94
454 28.49 32.7
510 30.67 33.14
672 31.92 33.73
499 28.44 41.92
560 27.94 35.06
848 29.74 32.71
617 29.54 37.96
530 31.34 37.38
649 30.08 35.55
824 29.13 42.89
626 31.72 37.17
Assuming that the underlying demand relation is a linear function of price and income, use your spreadsheet program to obtain least squares estimates of Ohio’s demand for KBC microbrews. Instruction:
If the estimate is negative, enter a negative number (-) in the equation.

Answer the question on the basis of the following cost data.

Output Average Fixed Cost Average Variable Cost
1 $50.00 $100.00
2 25.00 80.00
3 16.67 66.67
4 12.50 65.00
5 10.00 68.00
6 8.37 73.33
7 7.14 80.00
8 6.25 87.50

The marginal cost curve would intersect the average variable cost curve at about: ____________

a. 2 units of output.
b. 4 units of output.
c. 6 units of output.
d. 7 units of output.

Woolsey Corporation, a US company, expects to sell gods to a foreign customer at a price of 250,000 FC, with delivery and payment to be made on October 24, 2020. On July 24, 2020, Woolsey purchased a three-month put option for 250,000 FC and designated this option as a cash flow hedge of a forecasted foreign currency transaction expected to be completed in late October 2020. Assume that the transaction occurs on October 24, 2020 as expected. The option cost $4,000 and has a strike price of $2.17 per FC. The following spot exchange rates apply:

Suppose 5 years have gone by and the company has to make a decision on how to move forward. It can either pay out all earnings as dividends without considering any growth opportunities or choose a growth strategy where the company will expand into new lines of business in global markets. If the management chooses this strategy, the payout ratio will be reduced down to 20% from 35%, and the company will be able to maintain a growth rate of 7% forever. Which strategy should the management choose to maximize shareholder value

Below are amounts found in the income statements of three companies.

Company Sales Revenue Cost of Goods Sold Operating Expenses Non-operating Expenses Income Tax Expense
Henry $12,000 $3,000 $4,000 $1,000 $1,000
Grace 15,000 10,000 6,000 3,000 0
James 20,000 12,000 2,000 0 2,000

Required:
a. For each company, calculate (a) gross profit, (b) operating income, (c) income before income taxes, and (d) net income.
b. For each company, calculate the gross profit ratio and indicate which company has the most favorable ratio.

Cala Manufacturing purchases land for $281,000 as part of its plans to build a new plant. The company pays $35,400 to tear down an old building on the lot and $52,330 to fill and level the lot. It also pays construction costs $1,320,800 for the new building and $83,373 for lighting and paving a parking area. Prepare a single journal entry to record these costs incurred by Cala, all of which are paid in cash.

Bengal Co. provides the following unit sales forecast for the next three months: July August September Sales units 5,800 6,500 6,360 The company wants to end each month with ending finished goods inventory equal to 30% of the next month's sales. Finished goods inventory on June 30 is 1,740 units. The budgeted production units for July are:

Use the following information:
Windswept, Inc. 2017
Income Statement
($ in millions)
Net sales $10,200
Cost of goods sold 7,800
Depreciation 355
Earnings before interest and taxes $2,045
Interest paid 94 Taxable income $1,951
Taxes 585
Net income $ 1,366
Windswept, Inc. 2016 and 2017
Balance Sheets ($ in millions)
2016 2017 2016 2017
Cash $340 $360 Accounts payable $1,820 $1,680
Accounts rec. 1,050 950 Long-term debt 1,040 1,500
Inventory 1,820 1,740 Common stock 3,300 3,110
Total $3,210 $3,050 Retained earnings 620 870
Net fixed assets3,570 4,110
Total assets $6,780 $7,160 Total liab & equity $6,780 $7,160
What amount should be included in the financing section of the 2010 statement of cash flows for dividends paid?

Five-A-Day, a company that produces and distributes organic vegetables for grocery stores, wants to market its vegetables in such a way that children will want to buy them. To accomplish this, the company creates an advertising campaign that features children dressed up in vegetable costumes attending a Halloween party and eating vegetables and dips as a snack. The company also packages cut up vegetables in grab-and-go containers in fun shapes and colorful designs to attract children's attention in the grocery store. Which marketing function does this scenario most closely described

Are monopolistically competitive firms efficient in​ long-run equilibrium? Monopolistically competitive firms A. are productively efficient because they produce at minimum average total cost and they are not allocatively efficient because they produce where price is equal to marginal revenue. B. are not productively efficient because they do not produce at minimum marginal cost and they are allocatively efficient because they produce where price is equal to marginal revenue. C. are not productively efficient because they do not produce at minimum marginal cost and they are allocatively efficient because they produce where marginal cost equals marginal revenue. D. are not productively efficient because they do not produce at minimum average total cost and they are not allocatively efficient because they produce where price is greater than marginal cost. E. are not productively efficient because they do not produce at minimum average total cost and they are not allocatively efficient because they produce where price is less than marginal cost.

What two factors are necessary for demand?

It costs Bonita Industries $12 of variable and $5 of fixed costs to produce one bathroom scale which normally sells for $35. A foreign wholesaler offers to purchase 3100 scales at $15 each. Garner would incur special shipping costs of $1 per scale if the order were accepted. Bonita has sufficient unused capacity to produce the 3100 scales. If the special order is accepted, what will be the effect on net income?
a. $46500 increase.
b. $6200 increase.
c. $6200 decrease.
d. $9300 decrease.

Fill in the blanks with the words given below.
a. Cancer
b. malignant tumor
c. benign tumor
d. metastasis
e. carcinoma
1. A________is a lump of abnormal cells that, although growing out of control, remains at its original site.
2. A________is an abnormally growing mass of cells that is actively spreading through the body.
3. A_________ is the spread of cancer cells from their site of origin to other sites in the body.
4. An individual with a malignant tumor is said to have_________
5. The most common type of cancer is a_______ this type always originates in tissues that line .

The following transactions took place for Smart Solutions Inc. 2017.

a. July 1 Loaned $64,000 to an employee of the company and received back a one-year, 9 percent note.
b. Dec. 31 Accrued interest on the note. 2018.
c. July 1 Received interest on the note. (No interest has been recorded since December 31.)
d. July 1 Received principal on the note.

Required:
Prepare the journal entries that Smart Solutions Inc. would record for the above transactions.

ando Company incurs a $10.00 per unit cost for Product A, which it currently manufactures and sells for $13.50 per unit. Instead of manufacturing and selling this product, the company can purchase it for $5.00 per unit and sell it for $11.90 per unit. If it does so, unit sales would remain unchanged and $5.00 of the $10.00 per unit costs of Product A would be eliminated. 1. Prepare Incremental cost analysis. Should the company continue to manufacture Product A or purchase it for resale

The fictional global firm of Knickerbockers Socks established itself in the international trade industry ten years ago and has been an active participant with intra-industry trade in developed countries. Because of the way Knickerbockers operates, it can take advantage of economies of scale. What do economies of scale make possible for its sock customers

An effective performance management system is comprised of four steps: defining performance, monitoring and evaluating performance, reviewing performance, and providing consequences. This activity is important because, when administered properly, an effective performance management system is a powerful tool in your managerial repertoire for enhancing individual, group, and organizational effectiveness.
The goal of this exercise is to challenge your knowledge of the steps in the performance management process. cuook. Match each person to the step of performance management that his or her description best exemplifles.
1. Define Performance
2. Review Performance
3. Provide Consequences
4. Monitor and Evaluate Performance
Match eech of the options above to the items below.
A. Aileen and her supervisor discuss how the market is looking and how much of an increase sales she believes is realistic and attainable for this year.
B. Quentin has a discussion with his supervisor about how sales are going and whether or not it looks like he will make this year's budgeted sales figures.
C. While Vonda's sales are strong, they do not appear to be in line with what she and her supervisor anticipated, so they are meeting to discuss how she can boost her sales In time to meet her goals.
D. Yang receives his bonus check when he beats his sales goals by 10%.

Finlay, Inc., issued 10,000 shares of $51 par value preferred stock at $69 per share and 14,000 shares of no-par value common stock at $10 per share. The common stock has no stated value. All issuances were for cash. a. Prepare the journal entries to record the share issuances. b. Prepare the journal entry for the issuance of the common stock assuming that it had a stated value of $5 per share. c. Prepare the journal entry for the issuance of the common stock assuming that it had a par value of $1 per share.

A form of marketing in which a product or service is promoted by an individual that an audience looka up to is ___ marketing.

Adjusted Trial Balance
Account Title Debit Credit
Cash 1,500
Accounts Receivable 1,460
Prepaid Insurance 800
Supplies 900
Equipment 5,500
Accumulated Depreciation-Equipment 550
Accounts Payable 1,300
Wages Payable 760
Owner, Capital 6,550
Owner, Drawing 1,400
Service Revenue 8,900
Wages Expense 3,000
Rent Expense 1,500
Supplies Expense 900
Utilities Expense 600
Depreciation Expense—Equipment 500
18,060 18,060

Required:
From the above adjusted trial balance, journalize the necessary closing entries.