Ms. Magan Dah and her sister, Ms. Supla Dah got into the cakes and pastries business almost by accident. Magan, a BSHRM graduate, often bake cakes as gifts for friends. Occasionally, they would set up a booth at a trade fair and sell a few of the cakes. The day came when a buyer for a major department store offered them a contract to produce 1,500 cakes of various flavors for $10,000. The sisters realized that it was time to get down to business. To make bookkeeping simpler, they have priced all the cakes at $8. Variable cost per unit is $6 and they have to rent a facility for $4,000 a month. 1) Calculate the breakeven. 2) Calculate their COGS on the department store order. 3) Calculate their Operating Ex enses on the department store order.
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- Ms. Magan Dah and her sister, Ms. Supla Dah got into the cakes and pastries business almost by accident. Magan, a BSHRM graduate often bake cakes as gifts for friends: Occasionally, they would set up a booth at a trade fair and sell a few of the cakes. The day came when a buyer for a major department store offered them a contract to produce 1,500 cakes of various flavors for $10.000. The sisters realized that it was time to get down to business. To make bookkeeping simpler, they have priced all the cakes at $8 Variable cost per unit is $6 and they have to rent a facility for $4,000 a month 4) Calculate their EBIT on the department store order. 8)If the store refuses to pay more than $58.00 per unit but is willing to negotiate quantity, what quantity of cakes will result to an EBIT of $4,000?Ms. Magan Dah and her sister, Ms. Supla Dah got into the cakes and pastries business almost by accident. Magan, a BSHRM graduate often bake cakes as gifts for friends: Occasionally, they would set up a booth at a trade fair and sell a few of the cakes. The day came when a buyer for a major department store offered them a contract to produce 1,500 cakes of various flavors for $10.000. The sisters realized that it was time to get down to business. To make bookkeeping simpler, they have priced all the cakes at $8 Variable cost per unit is $6 and they have to rent a facility for $4,000 a month. 1) Calculate the breakeven. 2) Calculate their COGS on the department store order. 3) Calculate their Operating Expenses on the department store order 4) Calculate their EBIT on the department store order.During their senior year at Clarkson College, two business students, Gerry Keating and Louise Lamont, began a part-time business making personal computers. They bought the various components from a local supplier and assembled the machines in the basement of a friend's house. Their only cost was $363 for parts; they sold each computer for $638. They were able to make three machines per week and to sell them to fellow students. The activity was appropriately called Keating & Lamont Computers (KLC). The product quality was good, and as graduation approached, orders were coming in much faster than KLC could fill them. A national CPA firm made Ms. Lamont an attractive offer of employment, and a large electronics company was ready to hire Mr. Keating. Students and faculty at Clarkson College, however, encouraged the two to make KLC a full-time venture. The college administration had decided to require all students in the schools of business and engineering to buy their own computers…
- During their senior year at Clarkson College, two business students, Gerry Keating and Louise Lamont, began a part-time business making personal computers. They bought the various components from a local supplier and assembled the machines in the basement of a friend's house. Their only cost was $364 for parts; they sold each computer for $633. They were able to make three machines per week and to sell them to fellow students. The activity was appropriately called Keating & Lamont Computers (KLC). The product quality was good, and as graduation approached, orders were coming in much faster than KLC could fill them. A national CPA firm made Ms. Lamont an attractive offer of employment, and a large electronics company was ready to hire Mr. Keating. Students and faculty at Clarkson College, however, encouraged the two to make KLC a full-time venture. The college administration had decided to require all students in the schools of business and engineering to buy their own computers…One of Natalie’s friends, Curtis Lesperance, runs a coffee shop where he sells specialty coffees and prepares and sells muffins and cookies. He is eager to buy one of Natalie’s fine European mixers, which would enable him to make larger batches of muffins and cookies. However, Curtis cannot afford to pay for the mixer for at least 30 days. He asks Natalie if she would be willing to sell him the mixer on credit. Natalie comes to you for advice. She asks you to address the questions below. Curtis has given me a set of his most recent financial statements. What calculations should I do with the data from these statements, and what questions should I ask him after I have analyzed the statements? How will this information help me decide if I should extend credit to Curtis? Is there an alternative other than extending credit to Curtis for 30 days? I am thinking seriously about being able to have my customers use credit cards. What are some of the advantages and disadvantages of letting my…One of Natalie’s friends, Curtis Lesperance, runs a coffee shop where he sells specialty coffees and prepares and sells muffins and cookies. He is eager to buy one of Natalie’s fine European mixers, which would enable him to make larger batches of muffins and cookies. However, Curtis cannot afford to pay for the mixer for at least 30 days. He asks Natalie if she would be willing to sell him the mixer on credit. Natalie comes to you for advice. She asks the following questions. “Curtis has given me a set of his most recent financial statements. What calculations should I do with the data from these statements, and what questions should I ask him after I have analyzed the statements? How will this information help me decide if I should extend credit to Curtis?” “Is there an alternative other than extending credit to Curtis for 30 days?” “I am thinking seriously about being able to have my customers use credit cards. What are some of the advantages and disadvantages of letting my…
- Pepe and Pilar decided to open a souvenir shop during the town's fiesta. They agreed to manage the stall in rotation, with Pepe reporting in the first seven hours starting at seven o'clock in the morning and Pilar from three o'clock in the afternoon up to nine o'clock in the evening. This arrangement required for profits to be divided equally. The transactions are as follows: 1. Pepe purchased the souvenirs at a cost of P150,000. 2. Pilar paid for the stall operating expenses, P50,000. 3. Cash sales were made and withheld by cach operator: Pepc, P125,000 and Pilar, P150,000. Pepe returned the remaining unsold souvenirs and got a cash refund of P15,000. 4. Profit was determined at the end of the town fiesta. 5. Cash settlement was made by the operators. Required: a) Record in each book only the transactions affecting each operator. b) Determine profit or loss and made the entry in each book. c) Record cash settlement supported by an accountability table.One of Natalie’s friends, Curtis Lesperance, runs a coffee shop where he sells specialty coffees and prepares and sells muffins and cookies. He is eager to buy one of Natalie’s fine European mixers, which would enable him to make larger batches of muffins and cookies. However, Curtis cannot afford to pay for the mixer for at least 30 days. He asks Natalie if she would be willing to sell him the mixer on credit. Natalie comes to you for advice. She asks the following questions. “Is there an alternative other than extending credit to Curtis for 30 days?”Jenny operated a small shop selling hygienic supplies and bought facial masks worth $15,000 from the supplier, Amy. Jenny visited Amy’s office and gave Amy an uncrossed bearer cheque for full payment. When Amy finished her job and rushed to meet her customer by taking the MTR, she lost the cheque somewhere on the way accidentally. William found the cheque left on the floor of the MTR platform and picked it up. William was unemployed for six months and needed $15,000 to pay this month rent. After noticing the characteristic of this cheque, this was a bearer cheque. William took this bearer cheque to Isaac, his landlord, to pay this month’s rent of $15,000.Isaac deposited this cheque to her ABC Bank. The cheque was duly cleared through the Isaac’s bank and paid by Jenny’s CDE Bank. a) Explain how to apply “Holder in Due Course” (HIDC) in this case. b) Who is the true owner of this cheque from three parties of Amy, William and Isaac?c) If the cheque was crossed and the words “not…
- Coby is plumber who engages Peter to buy materials on his behalf. Peter is given a limit of $1,500 on purchases that he makes on Coby’s behalf. U-Bend Pty Ltd is a wholesaler of PVC piping from whom Peter has purchased pipes before . The company was selling piping at a discount price. Peter purchase a quantity of this piping for $2,000 and arranged for delivery. Peter thought it was too good a deal to pass up, even though it was in excess of his limit of $1,500 . Coby is refusing to accept the delivery of the pipes from U- Bend Pty Ltd Under Agency Law, will Coby be bound by the purchase?Mr. Juan is a retired government employee who is good at baking. One day he decides to put up a bakery shop in your barangay. He renovated a portion of his house to serve as the area of the production of bread. He purchase baking equipment and raw materials to produce five different types of bread. Mr. Juan also hires Jose to help him with the baking and at the same time, to be in-charge of sales. Mr. Juan pays Jose on weekly basis. Every day, Mr. Juans wife deposits the daily cash sales in their bank account at XY Savings Bank. Question: With the help of accounting, what possible decisions or questions of Mr. Juan can accounting provide an answer to?Alice Trading runs 10 branches and pays for a variety of expenses. Zabrina, the Accounts Payable Clerk of Alice Trading writes the checks for each supplier and the Accounting Manager signs the checks. Zabrina decided she needs a raise and the Manager told her to wait for six months. Zabrina devised a plan to get a raise on her own. She created a new supplier account for her friend’s business, Prime Auto Parts. Zabrina also created two purchase orders for Prime Auto Parts for ₱20,000 and ₱15,000 and wrote checks to pay these invoices. She knows the Manager will sign all checks only looking at the checks over ₱30,000. She delivers the checks to her friend who will encash the checks and give the money to Zabrina. Is this a good way for Zabrina to obtain a raise? Eventually, what will be the effect of her actions? How can Jiffy prevent this type of incident?