Percent of account receivable method to estimate bad debits

At each calendar year-end mazie supply co. uses the percent of account receivable method to estimate bad debits. On December31,2013 it has outstanding accounts receivable of 55000 and estimated that 2% will be uncollectible . prepare the adjusting entry to record bad credit expense for the year 2013 under the assumption that the Allowance for doubtful accounts has (a) a 415 credit balance before the adjustment and (b) a 291 debit balance before the adjustment

When a company decides to go public

When a company decides to go public, it can typically obtain capital by issuing stocks or bonds. Suggest four (4) leading financial ratios that will be evaluated and how each will impact the company’s decision to obtain expansion funds. Determine whether the results of the ratios would alter the decision to go public.

The fiscal year ended Feb 2, 2013 (2012 Annual Report) for Kroger

For the fiscal year ended Feb 2, 2013 (2012 Annual Report) for Kroger:

1a Which CPA firm audited the financial statements?

1b What type of opinion was issued?

2a What are “deposits in transit”?

2b Are they properly classified on the balance sheet? Explain briefly.

3a Compute the rate of change in weekly sales from 2010 to 2011, and 2011 to 2012. Comment briefly.

3b Why use weekly sales instead of annual sales in making this calculation?

4a What factor causes the difference between basic and fully diluted earnings per share for 2012?

4b Is this difference material?

4c Compute basic earnings per share for 2012 as if there were no treasury stock. Comment.

5 What was the amount of cash dividends paid in fiscal 2012?

6a Compute current ratio and quick ratio for both years presented.

6b Identify any observable change.

6c Identify the major contributing factor to this change.

7 How does the company recognize revenue from sales of Kroger-branded gift cards?

8 Why did Kroger take a charge of $18 for goodwill impairment in 2010?

9 Does Kroger consolidate any entities that it owns less than 100%? Explain.

10a For 2012 and 2011, compute debt/equity and debt/tangible net worth ratios.

10b For the same years, compute the ratio of operating cash flow to interest charges, and to total debt.

10c Comment briefly on the riskiness of Kroger’s capital structure.

11a Why is the commitments and contingencies line blank on the balance sheet?

11b Briefly describe any material litigation Kroger was involved in in 2012, and the resolution of the matter.

12a What is the total number of restricted shares outstanding at the end of fiscal 2012?

12b Is this material to the total number of shares outstanding? Explain briefly.

13a Distinguish between capital and operating leases.

13b Which type of lease does Kroger make greater use of?

13c What was the total net rent expense for 2012?

14 What was the amount of advertising expense for 2012?

15 Kroger’s sales are for cash. Why are there accounts receivable on the balance sheet?

16a Kroger has three types of benefit plans: qualified, non-qualified, and other. What is the funded status of these plans as of the end of 2012?

16b How, if at all, is this funding status reflected in the balance sheet?

16c What amount of expense was recognized for these three types of plan in 2012?

16d Kroger’s pension fund assets are invested largely in three types of investment. Identify these, and comment briefly.

17a What segments (product types) does Kroger divide its operations into?

17b What trend is observable in the relative importance of these segments in terms of sales?

18a Compute the following for years 2012, 2011, and 2010: gross profit margin, operating profit margin, net profit margin (return on sales).

18b Comment on Kroger’s profitability based on the above.

Incremental Analysis

Describe what is meant by Incremental Analysis? Briefly describe an example from a situation you know or have read about?

Your recommendation for any company

Your recommendation for any company who processes the ordering technology relates to Accounting Information System. Specifically discuss internal controls.

Mifflin Corporation manufactures a single product

Mifflin Corporation manufactures a single product with the following standard costs:

Direct materialsäóî3 pounds plastic at $7 per pound

Direct laboräóî0.50 hours at $11.00 per hour

Variable manufacturing overhead 3.00

Fixed manufacturing overhead 4.00

The predetermined manufacturing overhead rate is $14 per direct labor hour ($7 í‡ 0.50) based on normal production of 2,700 direct labor hours (5,400 units) for the month. The master budget showed variable costs of $16,200 ($6.00 per hour) and total fixed overhead costs of $21,600 ($8.00 per hour). Actual costs for October for production of 3,500 units show:

Direct materials (10,620 pounds) $ 76,995

Direct labor (1,560 hours) $17,706

Variable overhead $17,175

Fixed overhead $9,305

Quantity purchased equals quantity used so ignore raw material inventory.

(a) Compute all of the materials and labor variances.

(b) Compute the total overhead variance.

Solution Summary

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ABC Company estimated its bad debts equal to 2.5%

ABC Company estimated its bad debts equal to 2.5% of its $850,000 credit sales for the year 2011. On December 31, 2011 ABC Company made an adjustment for the 2.5% amount. On July 1, 2012 the management decided that $2,000 account of Mary Smith was uncollectible and wrote it off using Allowance for Doubtful Accounts. On December 31, 2012 Mary Smith returned and paid her account in full. Please prepare the required four (4) journal entries for the above events. Each entry is worth five (5) points each.

SOX compliance surveys

By researching the results of SOX compliance surveys, assess the financial impact that SOX might have on your company if it decides to go public. Considering the impact of SOX compliance, take a position as to whether your company can overcome the challenges posed by SOX compliance if the decision is to go public. Based on your research, support your decision by identifying the potential advantages and disadvantages that SOX may have on your company. Provide specific examples.

Make a recommendation as the CEO regarding the alternative (i.e., going public or staying private) that will best support the company’s expansion goals. Support your position.

Accounting process

What is the accounting process? Please explain in detail

The practice of accounting and its use in businesses

How do the following relate to the practice of accounting and its use in businesses?

1. Preparation of closing entries, reversing entries and the post-closing trial balance

2. Preparation of a classified income statement, retained earnings statement and balance sheet

Car loan and a mortgage

The scenario is designed to help you determine and evaluate the payment amount of a car loan and a mortgage, based on the assumption that your household income is $36,000 per year or $3,000 per month.

Based on your income, you may spend 28% of your monthly income on housing, and 10% on a car loan. You are to put a 3% down payment on the house and a 10% down payment on the car.


Using Microsoft Excel, address the following issues:

1.What is the maximum car payment and mortgage payment you can afford with the following conditions: your monthly household income, 10% for the car payment, and 28% for the mortgage payments?

2.Assume a 10% down payment on the car and a 3% down payment on the house. Also, assume that you can get financing for the car at 7% for 60 months, and the house can be financed at 5% for 30 years. How much could you spend on the car and the house? You must submit your calculations in a Microsoft Excel document showing how answers were reached.

3.Create a complete amortization schedule for the car, using the information in questions 1 and 2.

4.Discuss the distributions of principal, interest and the balance over the life of the loan.

Stock splits and property dividend journal entries

Stock splits and property dividend journal entries

Symbol Two Corporation had the following transactions:

(a) The par value of the capital stock is reduced to $0.50 with a 2-for-1 stock split.

(b) A 10% stock dividend is declared and distributed at a time when the market value of the shares

is $25 per share.

(c) A property dividend is declared September 12, 2010, and paid October 1, 2010, in common shares

in another company held as an equity investment. The equity investment has a book value of

$50,000 and a fair market value of $205,000.

Create the journal entries for these.

Bio Industries had stock outstanding

On January 1, 2010, Bio Industries had stock outstanding as follows.

8% Noncumulative preferred stock, $100 par value, issued and outstanding 250,000 shares $25,000,000

Common stock, $1 par value, issued and outstanding 600,000 shares 600,000

To acquire the net assets of three smaller companies, Bio issued an additional 600,000 common shares.

The acquisitions took place as follows.

Date of Acquisition Shares Issued

MicroBio February 1, 2010 200,000

BioTech June 1, 2010 80,000

SuperBio November 1, 2010 320,000

On December 31, 2010, Bio recorded net income of $9,862,000 before taxes. No dividends on the common

or preferred were declared during 2010.

Assuming a 40% tax rate, compute the earnings per share data that should appear on the financial statements

of Bio Industries as of December 31, 2010.

Yellow Car common stock

On Jan 1 Yellow Car Company issued 15-year, $50,000,000 face value, 4% bonds, at par value.

Each $1,000 bond is convertible into 20 shares of Yellow Car common stock.

The bonds were not converted in the current year.

Yellow Car’s net income in the current year was $8,680,000, and its tax rate was 30%.

The company had 2,650,000 shares of common stock issued and outstanding throughout the current year.

(a) Solve for diluted EPS for the current year.

(b) Solve for diluted EPS for the current year, using the data found above, except instead of the bods, $50,000,000 of 6% convertible preferred stock was issued. Each $100 preferred share is convertible into 2 shares of Yellow Car common stock.

Accounting Information Systems (AIS) course

Describe your favorite topic from Accounting Information Systems (AIS) course. State why it is your favorite and how it will help you in your profession.

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