The Robinson Company sells sports decals that can be personalized with a player”s name, team name, and jersey number for $5 each. Robinson buys the decals from a supplier for $1.50 each and spends an additional $0.50 in variable operating costs per decal. The results of last month”s operations are as follows: Sales $10,000 Cost of goods sold 3,000 Gross profit 7,000 Operating costs 2,500 […]

Seaver & Co., a CPA firm, prepare their own financial statements with a December 31 year-end. 1. As of December 31, Seaver & Co. have rendered $20,500 worth of services to clients for which they have not yet billed the client, and for which they have not made any accounting entry. 2. Seaver & Co. owns equipment (computers, etc.) having an original cost of $12,000. […]

Mary Smith sells gourmet chocolate chip cookies. The results of her last month of operations are as follows: Sales revenue Cost of goods sold (all variable) 25,575 Gross margin Selling expenses (20% variable) 8,000 Administrative expenses (60% variable) 12,000 Operating income $ 4,425 Required Prepare a contribution format income statement for Mary. If Mary sells her cookies for $1.60 each, how many cookies did she […]

Susan’s Sweets opened a candy shop on January 1. 1. Susan invested $100,000 in cash on January 1, 1999, and began business as a sole proprietorship. 2. Susan paid $20,000 for a six-month lease. The lease is renewable for another six months on July 1. 3. Susan purchased candy and other “sweetmeats” at a cost of $40,000 in cash. 4. Susan purchased store fixtures at […]

Matt’s Ski Shop is in the process of acquiring a vehicle for the business. The following transactions took place in December, 2000: 1. Verbally agreed to purchase a used car from Slee-Z-Auto for $3,500. 2. Paid $400 for a warranty on the used car. 3. Took the car on a test drive, found it faulty, and told the salesperson to deliver a different car. 4. […]

Sue’s Mediation League (SML) engaged in the following transactions in 2000: 1. On January 1, SML borrowed $250,000 at nine percent per year with interest due quarterly. 2. SML paid $1,000 to a good friend who helped obtain the loan. 3. SML had not yet paid any interest after the loan had been in effect for three months. 4. On June 30, SML paid the […]

Sharon’s Affairs and Parties (SAAP) engaged in the following transactions in 1999: 1. SAAP borrowed $150,000 at 10 percent per year to begin operations. 2. SAAP accrued the first month’s interest on the loan. 3. SAAP accrued the second month’s interest. 4. SAAP paid the interest due at the end of the second month. 5. Sharon loaned SAAP $10,000 at 24 percent interest per year. […]

Vendela has the following sales budget for the year ending December 31, 2014: Quarter 1 2 3 4 Year Expected unit Sales 4,000 3,500 5,000 5,500 18,000

Brinkley Company’s production budget for 2014 by quarters is as follows: (1) 6,000, (2) 7,000, (3), 8,000, and (4) 9,000. For the first quarter of 2015, the budget is 8,000 units. The manufacture of each unit requires three pounds of direct materials and an expected cost per unit of $2. The ending inventory of direct materials is expected to be 20% of the next quarter’s […]

Comparative data for the following investment centers of Thorson Company are shown below. DeKalb Madison Ann Arbor Urbana Controllable margin $ 48,000 (b) ‘120,000 $100 000 Average operating assets 400,000 500,000 800,000 (d) Return on investment (a) 14% (Cl -12% Instructions Compute the missing amounts using the ROI formula.