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...
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...
variance can be explained by the following: $1,590 (530 actual pounds used X $3 standard cost) vs. the standard of $1,500 (100 units of output X 5 standard pounds = 500 standard pounds x $3 standard cost). Join PRO to...
the first costs are assumed to have been the first costs out of inventory to become part of the cost of goods sold. Under the LIFO cost flow assumption, the inventory will be valued at the older costs, since the more...
cannot be determined, it should be charged to expense immediately. For example, the entire cost of a television advertisement that is shown during the Olympics will be charged to advertising expense in the year that the...
on the income statement) and has also earned the reported amount of net income or net loss. Neither the draws made by the sole proprietor nor the dividends distributed by a regular corporation are reported on the income...
, the payment will be a debit of $27,720 to Accounts Payable, a debit of $280 to Purchase Discounts, a credit to Cash for $28,000. Purchase Discounts Lost is an income statement account.] Join PRO to Track Progress Mark...
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...
or as an asset, the amounts must be adjusted so that the financial statements report the expense (reported as the cost of goods sold on the income statement for the year) at $6,900 and the asset inventory (reported on...
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...
+ $2,000 = $7,000. 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 Refresh your skills to re-enter the...
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 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...
amount per unit produced or used. Therefore, the total amount of the variable cost will change proportionately with the change in volume or activity. Learn more about variable costs Join PRO to Track Progress Mark the...
in the balance sheet account Inventory: $400 (80 units X $5) Cost of goods sold: $4,600 ($5,000 – $400) or (920 units X $5) Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance...
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 an explicit cost presented as salary expense on the corporation’s income statement. Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping...
. 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...
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...
inventory, the finished goods inventory, and the cost of goods sold. 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...
. 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 workforce Pass...
sheet will report Deferred revenues of $10,000 (the company’s remaining obligation/liability from the $30,000 it received on December 27). Join PRO to Track Progress Mark the Question as Read Must-Watch Video...
corporation. 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...
Issue Costs for $1,200 ($24,000/20 six-month periods) Debit Interest Expense for $1,200 Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to Advance Your Accounting and Bookkeeping...
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...
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...
) 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...
of Gains Other examples of gains that could appear on a company’s income statement include: Gain on sale of investments Gain on sale of building Gain on legal settlement Gain on early extinguishment of debt Join PRO...
and the amount can be estimated, it should be recorded in the accounts and the amount of the liability reported on the balance sheet.) Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to...
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...
. If the displays continue to be used in the 11th year, there will be no depreciation expense in the 11th year and the accumulated depreciation will continue to be $120,000. Join PRO to Track Progress Mark the Question...
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...
– Corporation Income Statement: Retail/Whsle – Corporation, Multiple-Step Statement of Cash Flows: Corporation, Indirect Method Join PRO to Track Progress Mark the Question as Read Must-Watch Video Learn How to...
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...
An individual owner of a business that is not incorporated.
See sole proprietorship.
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...
Another word for purchasing.
The amount received from the sale of an asset, from the issuance of bonds or stock, or from a bank loan.
A word to describe whether a company is able to earn more revenues than expenses.
Dollars of gross profit divided by the dollars of net sales. Also known as gross margin.
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