Bethel Corp. is a retail company and had the following transactions during March, 2007, its first month of

Bethel Corp. is a retail company and had the following transactions during March, 2007, its first month of operations:

March 1 - The owner invested $12,000 into the business.

March 1 - The company bought inventory for cash of $7,500.

March 7 - This month's rent was paid in cash totaling $1,500.

March 12 - Advertising was incurred during

March for $540. The bill will be paid in April.

March 13 - The company sold merchandise for $9,000.

Cash collected from the customers for these goods was $7,000, the remainder will be collected next month. March 13 - The cost of the merchandise sold in the previous transaction was $5,000.

March 31 - During the month the employees were paid $1,000 in cash and an additional $300 of wages was owed to them, but had not been paid.

Required: Using the above transactions prepare the following statements: A. Income Statement (10 points) B. Balance Sheet (5 points)
 

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Your division is considering two projects with the following net cash flows Project A 0= -$25 1= $5 2= $10 3= $17 Project B 0= -$20 1= $10 2= $9 3= $6

Your division is considering two projects with the following net cash flows.

Project A 0= -$25 1= $5 2= $10 3= $17

Project B 0= -$20 1= $10 2= $9 3= $6

What are the projects NPV's assuming the WACC is 5%? 10%? and 15%?

What are the projects IRR,s at each of these WACC's?

If the WACC was 5% and project A and B were mutually exclusive, which project would you choose?

What if the WACC was 10%? 15%?

SOLUTION PREVIEW

	Project A								Project B
Year	Cash flows	PV @5%		PV @10%		PV @15%		Year	Cash flows	PV @5%		PV @10%		PV @15%
0	-25	$   -25.00		$   -25.00		$   -25.00		0	-20	$   -20.00		$   -20.00		$   -20.00
1	5	$       4.76		$       4.55		$       4.35		1	10	$       9.52		$       9.09		$       8.70

 File name: Project_A_and_B.xlsx  File type:  .doc  PRICE: $12

The ledger of Hixson Company at the end of the current year shows accounts receivable 120,000, sales

The ledger of Hixson Company at the end of the current year shows accounts receivable 120,000, sales 840,000 and sales returns and allowance 30,000.

 

Instructions

A) If Hixson uses the direct write off method to account for uncollectible accounts, journalize the adjusting entry at December 31, assuming Hixson determines that fells 1.400 balance is uncollectible.

B) If allowance for doubtful accounts has a credit balance of 2,100 in the trial balance journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 1 % of net sales, and (2) 10 % of accounts receivable

C) If allowance for doubtful accounts has a debit balance of $200 in the trial balance, journalize the adjusting entry at December 31, assuming bad debts are expected to be (1) 0.75% of net sales and (2) 6% of accounts receivable.

File name:E9-3-The-ledger-of-Hixson.doc File type:application/msword Price: $5

E10-2 Trudy Company incurred the following costs. 1. Sales tax on factory machinery purchased $5,000 2.

E10-2 Trudy Company incurred the following costs.

1. Sales tax on factory machinery purchased $5,000
2. Painting of and lettering on truck immediately upon purchase 700
3. Installation and testing of factory machinery 2,000
4. Real estate broker’s commission on land purchased 3,500
5. Insurance premium paid for first year’s insurance on new truck 880
6. Cost of landscaping on property purchased 7,200
7. Cost of paving parking lot for new building constructed 17,900
8. Cost of clearing, draining, and filling land 13,300
9. Architect’s fees on self-constructed building 10,000

Instructions:
 Indicate to which account Trudy would debit each of the costs.

 

File name: Trudy-Company.doc File type: application/msword  Price: $3

E10-13 Herzogg Company, organized in 2008, has the following transactions related to intangible assets

E10-13 Herzogg Company, organized in 2008, has the following transactions related to intangible assets. 1/2/08 Purchased patent (7-year life) $560,000
4/1/08 Goodwill purchased (indefinite life) 360,000
7/1/08 10-year franchise; expiration date
7/1/2018 440,000
9/1/08  Research and development costs 185,000

Instructions

 Prepare the necessary entries to record these intangibles. All costs incurred were for cash. Make the adjusting entries as of December 31, 2008, recording any necessary amortization and reporting all intangible asset balances accurately as of that date.

File name:Herzogg-Company.doc File type:application/msword Price: $4