Accounting Answers

The sales and distribution team of the company i-Ace Solutions forecasted the demand of one of their products,

product-A at their four big retailers, in the next quarter. Accordingly, they also collected the data of the supply

capacity of their various distributors.

It was observed that the demands for retailer1, retailer 2, retailer 3 and retailer 4 are 6, 10, 15 and 4 quintals

respectively. Similarly, the supply capacities of the three suppliers S1, S2 and S3 are 14, 6 and 5 quintals

respectively.

The table 2 given above mentions the transportation cost involved in transporting one quintal of item A from

each distributor (S1, S2 and S3) to each retailer (R1, R2, R3 and R4).

Using North-West corner method determine an initial basic feasible solution of the transportation problem and

the total transportation cost.

How is the equity value of a business calculated considering only the accounts in the owner's equity section of the trial balance? 

A company has issued 1200 equity shares of Rs.10each to the public and called the amount of thereon as under

With application Rs.2.50 per share

(Including premium of Rs 2)

On allotment of Rs 4.50per share

On final call Rs 5Per share

Mr Raj pawar has purchased 130 shares He failed to pay on final call and therefore his shares were forfeited these forfeited share were re issued to Mr.Ravindra Raut at an agreed price of Rs.10.50per share

Prepare and pass the necessary Journal entries

12 Performed fashion designing services for Bb. Pilipinas Organization worth P80,250, on account.

16 Received bill from National Bookstore for office supplies, P8,500. (Use Expense Method)

17 Catriona Gray paid cash for services rendered, P14,790.

22 Paid Shell Station for gasoline for service vehicle, P1,500.

24 Performed customized wedding gown designing services to Jennylyn Mercado and was billed for services

rendered, P17,500.

27 Paid Robinsons Cybergate P4,500 to apply on account.

29 Received P80,250 from Bb. Pilipinas Organization in full payment of account.

30 Billed Rabiya Mateo for services rendered, P21,600.

31 Receive and paid telephone bill, P2,300.

31 Paid salaries to employees, P31,500.

31 Beatrice withdrew cash for personal use, P18,000.

If the government levies an additional tax on lucury items the price of these items will rise how ever this will cause demand to decrease and as aresult the price will fall back down perhaps even to their original levels. Do you agree with this statement ? Explain

what is the future value of an annuity if the size of each payment is 2, 500, payable at the end of each quarter for five years at an interest rate of 9%

On 1 January 2020 Power Lid purchased a vehicle for $12 000 cash. It is the policy of the company

to depreciate vehicles at the rate of 20 % per annum under the straight-line method.

On 1 May 2020 the company bought a furniture for $4 000 by cheque. It is estimated that the

furniture will have a useful life of 3 years after which it will have scrap value of $100

a) Calculate depreciation for the vehicle for the year ended 31 December 2020 and 2021.

b) Calculate depreciation for the furniture for the year ended 31 December 2020 and 2021.

1)    How much money would you need to deposit into a bank account today at 6% per year in order to be able not to work and be able to withdraw $7,000 at the end of each year for the following 15 years?    (2 Points)

Xis considering purchasing a new piece of heavy machinery for $18.50 million. The machinery will be depreciated to zero book value over10 years using the straight-line depreciation method but is expectedto have a residual market value (selling price) at the end of the 10 years equal to $0.90 million. During the first year the machinery is expected to increase the company’s revenues by $1.70 million and, in addition, enable the company to save $1.50 million in employee salaries. Both of these numbers are to remain constant for the rest of themachinery’s useful life. The incometax rate is 18%; the company will use 80% equity and 20% debt to finance to investment; the risk-free rate in the country is 2.90%, the company’s beta has been estimated 1.10, and the market risk premium is 4.90% while cost of debt (before tax) is 3.50%.

a)Estimate the project’s cash flows.   (4 Points)

b)Estimate the project’s WACC.   (2 Points)

c)Estimate the project’s NPV.   (1 Point)

d) Estimate the project’s IRR.    (1 Point)

1. Company X wrote a check for 9,500.00 payable to Andrew Reyes and it cleared with the bank for the same amount. The accounting book of the company however shows that the same check issued to Mr. Reyes was recorded as 5,900.00. What is the effect of this entry to the bank or book balance? What will you do to reconcile the book and bank balances?