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this asset’s account balance must be decreased. Therefore, the second part of the entry will have to be a debit. In this transaction the account Rent Expense will be debited for $600. (Recall that expenses must be...
. (This is the $20 of gross wages per hour plus the $9.04 fringe benefit cost per hour.) Similarly, the employee is earning $29.04 for every hour worked. Join PRO to Track Progress Mark the Question as Read Must-Watch...
on the Additional Medicare Tax for higher income ($200,000+) taxpayers can be found on IRS.gov. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping...
with $560 for setting up the machine. If the company finds its prices to be higher than its competition, it should find ways to reduce the number of hours necessary to set up the machine and/or find other areas for...
must match each employee’s Medicare tax of 1.45% (but does not match the employee’s Additional Medicare Tax). Information on the Additional Medicare Tax can be found at www.irs.gov. Join PRO to Track Progress Mark...
the readers of the accounting reports with variances being reported to indicate on the report: “( ) = an unfavorable effect on net income.” Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn...
not change when there is an increase in an activity such as sales or production. Learn more about fixed expenses What is a fixed cost? A fixed cost is one that does not change in total within a reasonable range of...
underabsorbed the fixed overhead by $15,000 ($985,000 absorbed – $1,000,000 of actual costs). Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping...
present value, and (2) the internal rate of return. These calculations involve discounting the future cash flows since a dollar in the distant future will be less valuable than a dollar in the near future, and both of...
efficiency variance of $4,000 + the unfavorable direct labor rate variance of $5,520 is the total unfavorable direct labor variance of $9,520. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn...
will be allocated $20. Indirect manufacturing costs are also referred to as manufacturing overhead, factory overhead, or burden. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance...
be significant if the items become obsolete due to breakthroughs in technology. If the company cuts back on the quantity of goods it orders or the quantity of goods it produces in order to reduce its holding costs, the...
to operate its equipment. Therefore, the electricity cost is a direct production department cost that is variable since it changes with the volume of products manufactured. On the other hand the salaries of the...
for the shipping costs, which will be an expense in January when the sale is reported. The buyer records the purchase, accounts payable, and the increase in inventory on January 2 when the buyer becomes the owner of the...
and every item in inventory. By reviewing the turnover ratio for each item, the slow moving items cannot be hidden by the overall turnover ratio. Join PRO to Track Progress Mark the Question as Read Must-Watch Video...
, a unit cost is developed for the units processed in each production department. This is done by dividing the department’s costs by the units processed. Join PRO to Track Progress Mark the Question as Read Must-Watch...
of the points as well as any outlier(s). Also keep in mind that correlation does not guarantee there is a cause and effect relationship. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to...
, the cost of the production facilities’ rent might be assigned to the products at the rate of $4 per machine hour, but the rent actually occurs at the rate of $10,000 per month regardless of the number of machine...
are then allocated by the activity that is causing the costs in each cost pool. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform...
person confirms that the petty cash custodian’s cash and receipts adds up to the imprest amount. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and...
of $100,000 + positive PV of $89,730). The negative NPV means the investment will be rejected. However, the investment is expected to provide a return of approximately 15%. Join PRO to Track Progress Mark the Question...
. The company will then have to pay the endorsers/payees the amounts on the checks plus any fees their banks charged for handling the NSF checks. The payees may require the company to pay for future transactions...
of $42,000 Cost of goods available: $57,000 ($15,000 + $42,000) Cost of goods sold: sales of $50,000 X 80% = $40,000 Ending Inventory at July 31 at its estimated cost: $17,000 ($57,000 cost of goods available minus...
(or if SalesMax did not offer an early payment discount), GoodCorp will debit Accounts Payable for $1,140 and will credit Cash for $1,140. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How...
the death spiral. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job Refresh your skills to re-enter the...
PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job Refresh your skills to re-enter the workforce Pass your...
occurring. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job Refresh your skills to re-enter the...
inventory will be reported at a cost of $32 (2 units at $11 and 1 unit at $10). Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform...
be found at www.irs.gov. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job Refresh your skills to...
net cost of the borrowed money is $480,000 ($800,000 of interest minus $320,000 of income tax savings) or 4.8% ($480,000/$10,000,000). For a corporation with a combined tax rate of 30%, the net cost of the borrowed...
been amortized over its 3-year term. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job Refresh your...
, employees and customers. All of the components of net working capital should be examined in detail and managed properly. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your...
that some products should be promoted more aggressively and some products should be phased out. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping...
important because of its effect on the following: Cost of goods sold for more than one accounting period The amount of a company’s current assets The company’s working capital The company’s current ratio Join PRO...
for $2,000 and will credit Common Stock for $2,000. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job...
) Employer’s Tax Guide at the website www.irs.gov. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping Career Perform better at your current job...
Another word for purchasing.
To assign or allocate on a logical basis. For example, the materials price variance in a standard costing system is prorated to the following categories: materials inventory, work-in-process inventory, finished goods...
An individual owner of a business that is not incorporated.
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