Refer to Practice 7-15. Assume that the sale of the receivables was done with recourse. The estimated value of the recourse obligation is $1,300. Make the journal entry necessary on Cammo’s books to record the sale of these receivables with recourse. In Practice 7-15 Cammo Company sold receivables (without recourse) for $53,000. Cammo received $50,000 cash immediately from the factor (the company to whom the receivables were sold). The remaining $3,000 will be received once the factor verifies that none of the receivables is in dispute. The receivables had a face amount of $60,000; Cammo had previously established an Allowance for Bad Debts of $2,500 in connection with these receivables. Make the journal entry necessary on Cammo’s books to record the sale of these receivables.
> Discuss the financial and pricing techniques for motivating foreign distributors.
> As the global marketing manager for Coca-Cola, how would you monitor reactions around the world to a major competitor such as Pepsi?
> . Identify the ways to reach foreign markets by making a domestic sale.
> Why is it difficult – financially and legally – to terminate a relationship with overseas intermediaries? What should be done to prevent or minimize such difficulties?
> . What procedures should a firm follow in selecting a distributor?
> Use Figure 9.1 to identify the most important factors affecting the choice of foreign entry mode. Prioritize the factors.
> Discuss the possible implications that the firm’s choice of geographic expansion strategy may have on the ability of a local marketing manager of a foreign subsidiary to develop and implement marketing programmes.
> What are the differences between a global market segment and a national market segment? What are the marketing implications of these differences for a firm serving segments on a worldwide basis?
> What are the advantages and disadvantages of an opportunistic selection of international markets?
> Why is screening of foreign markets important? Outline the reasons why many firms do not systematically screen countries/markets.
> Identify some constraints in marketing to a traditional Muslim society. Use some of the examples in the chapter.
> Do you think that cultural differences between nations are more or less important than cultural variations within nations? Under what circumstances is each important?
> Identify the major dimensions used to analyse a competitor’s strengths and weaknesses profile. Do local, regional and global competitors need to be analysed separately?
> What is the reason for the ‘convergence of orientation’ in LSEs and SMEs?
> Using the following information, compute cash collected from customers. Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000 Cost of goods sold . . . . . . . . . . . . .
> The company constructed its own building. The cost of materials was $400,000. Labor cost incurred on the construction project was $600,000. Total overhead cost for the company for the year was $8,000,000; total labor cost (including the cost of construct
> Bad debt expense for the year was estimated to be $12,000. Total accounts written off as uncollectible during the year were $8,100. Make the necessary summary journal entries to record this information.
> The company exchanged a piece of land for a new piece of equipment. The equipment has a list price of $100,000, and the land has a historical cost of $35,000. The land has a current market value of $97,300. Make the journal entry necessary to record the
> Dandy Hardware Stores reported the following asset values in 2012 and 2013: In addition, Dandy Hardware had sales of $3,500,000 in 2013. Cost of goods sold for the year was $2,200,000. Compute Dandy Hardware’s fixed asset turnover rat
> On July 15, Mann Company sold $900,000 in accounts receivable for cash of $750,000. The factor withheld 10% of the cash proceeds to allow for possible customer returns or account adjustments. An Allowance for Bad Debts of $120,000 had previously been est
> Sterling Company’s bank statement for the month of March included the following information: Ending balance, March 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $32,346 Bank service charge for Mar
> Exploratory Company is an oil and gas exploration firm. During 2013, Exploratory engaged in 86 different exploratory projects, only 20 of which were successful. The total cost of this exploration effort was $24 million, $5.6 million of which was associat
> Combining the following information, compute the total amount of (1) Cash flow from investing activities and (2) Cash flow from financing activities. (a) Purchased a building for $120,000. Paid $40,000 and signed a mortgage with the seller for the remain
> Pringle Company has a substantial research department. Following are listed, in chronological order, some of the major activities associated with one of Pringle’s research projects. Project Started (a) Purchased special equipment to be used solely for th
> Trend Industries Company reported the following amounts on its 2012 and 2013 financial statements: 1. Compute the accounts receivable turnover for 2013. 2. What is the average collection period during 2013? (Use 365 days.)
> GoodeHill Company replaced some parts of its factory building during 2013: (a) The outside corrugated covering on the factory walls was removed and replaced. The job was done by an expert crew from Hollister Construction Company and will extend the life
> On July 23, Stevensonville Company purchased goods on account for $6,000. Stevensonville later returned defective goods costing $450. Record the purchase and the return of the defective goods assuming (1) A periodic inventory system and (2) A perpetual
> Olavssen Hardware regularly buys merchandise from Dawson Suppliers. Olavssen uses the net method to record purchases and discounts. On August 15, Olavssen Hardware purchased material from Dawson Suppliers. The invoice received from Dawson showed an invoi
> The following information was taken from the comparative financial statements of Tulip Corporation: Net income for year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 75,000 Sales revenu
> The company received a bank statement at the end of the month. The statement contained the following: Ending balance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $11,500 Bank servi
> McGraw Medical Center has received a bankruptcy notice for Phillip Hollister. Hollister owes the medical center $1,350. The bankruptcy notice indicates that the medical center can’t expect to receive payment of any of the $1,350. 1. Make the journal entr
> Refer to Practice 8-7 and Practice 8-10. Assume that the company uses the percentage-of-completion method and uses a cost-to-cost approach in estimating the percentage of completion. Make the journal entries to record revenue and cost for the constructio
> Organize the following summary information into the proper format for a statement of cash flows. Cash balance, beginning of year. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,800 Cash flow from financin
> Company S shipped goods costing $12,000 to Company T on consignment. The sales agreement states that Company T has 90 days to either sell the goods and pay Company S $18,000 for them or to return the goods to Company S. Make the journal entries necessary
> The company counted its ending inventory on December 31. None of the following items were included when the total amount of the company’s ending inventory was computed: • $15,000 in goods located in the company’s warehouse that are on consignment from an
> The following information from Tiny Company’s first year of operations is to be used in testing the accuracy of Accounts Receivable. The December 31, 2013, balance is $21,300. (a) Collections from customers, $53,000. (b) Merchandise purchased, $74,000. (
> Refer to Practice 7-2. Make all journal entries necessary to record both the sales and the cash collections. Use the net method of accounting for sales discounts. In Practice 7-2 On January 16, two credit sales were made, one for $300 and one for $400.
> Ratcliff Corporation purchased land, a building, a patent, and a franchise for the lump sum of $1,450,000. A real estate appraiser estimated the building to have a resale value of $600,000 (2/3 of the total worth of land and building). The franchise had
> The company sells satellite phone service. Customers are required to pay an initial fee of $360, followed by continuing service fees of $50 per month. The initial fee is not refundable. The company’s best estimate is that the average customer will contin
> Allred Shipping Co. acquired land, buildings, and equipment at a lump-sum price of $920,000. An appraisal of the assets at the time of acquisition disclosed the following values. Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> Refer to Practice 8-18. Indicate how the installment sales receivable would be reported in the balance sheet at the end of the year. In Practice 8-18 The company had sales during the year of $350,000. The gross profit percentage during the year was 20%.
> Bad debt expense is estimated using the percentage-of-accounts-receivable method. Total sales for the year were $600,000. The ending balance in Accounts Receivable was $200,000. An examination of the outstanding accounts at the end of the year indicates
> In exchange for land, the company received a 12-month note on January 1. The face amount of the note is $2,000, and the stated rate of interest is 12%, compounded annually. The 12% rate is equal to the market rate. The original cost of the land was $2,45
> Because of the extreme deterioration in the financial condition of a customer, the customer’s account in the amount of $7,500 was written off as uncollectible on July 23. By November 1, the customer’s financial condition had improved such that the custom
> The company paid $750,000 to buy a collection of assets. The assets had the following appraised values: Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $250,000 Buil
> Company A had sales for the year totaling $480,000. The net property, plant, and equipment balance at the beginning of the year was $160,000; the ending balance was $200,000. Compute the fixed asset turnover ratio.
> Using the following information, compute the cash balance. Restricted deposits in foreign bank accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 5,200 Cash overdraft . . . . . . . . . . . . . . . . . . . . . . . . . .
> Buyer Company purchased Target Company for $800,000 cash. Target Company had total liabilities of $300,000. Buyer Company’s assessment of the fair values it obtained when it purchased Target Company is as follows: Cash . . . . . . . . . . . . . . . . .
> Sales for the year were $400,000. The Accounts Receivable balance was $50,000 at the beginning of the year and $65,000 at the end of the year. Compute the average collection period using (1) The average accounts receivable balance and (2) The ending acco
> Cammo Company sold receivables (without recourse) for $53,000. Cammo received $50,000 cash immediately from the factor (the company to whom the receivables were sold). The remaining $3,000 will be received once the factor verifies that none of the receiv
> Stafford Company purchased Deaver Manufacturing for $1,400,000 cash on January 1. The book value and fair value of the assets of Deaver as of the date of the acquisition follow: In addition, Deaver had liabilities totaling $500,000 at the time of the a
> Using the following information, compute cash paid for income taxes. Reported income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $35,500
> Using the following information, compute cash flow from operating activities. (With the limited information given, only the indirect method can be used.) Decrease in inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> During the year, the company made the following research and development expenditures: Compute the total research and development (R&D) expense for the year assuming (1) The expenditures were for normal R&D, (2) The expenditures were for softwa
> On January 16, two credit sales were made, one for $300 and one for $400. Terms for both sales were 3/15, n/30. Cash for the $300 sale was collected on January 25; cash for the $400 sale was collected on February 14. Make all journal entries necessary to
> Using the following information, compute cash flow from operating activities. (With the limited information given, only the indirect method can be used.) Increase in accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> The company recently replaced the heating/cooling system for its building. The old system cost $160,000, and was 80% depreciated. The new system cost $210,000, which was paid in cash. The new system will extend the economic useful life of the building by
> On July 15, goods costing $8,400 were sold for $12,000 on account. The customer returned the goods before paying for them. Make the journal entry or entries necessary on the books of the seller to record the return of the goods. Assume that the goods are
> The company purchased a mining site that will have to be restored to certain specifications when the mining production ceases. The cost of the mining site is $800,000, and the restoration cost is expected to be $200,000. It is estimated that the mine wil
> Historically, warranty expenditures have been equal to 4% of sales. Total sales for the year were $750,000. Actual warranty repairs made during the year totaled $37,400. Make the necessary summary journal entries to record this warranty-related informati
> The company has received a donation of land from a rich local philanthropist. The land originally cost the philanthropist $48,000. On the date of the donation, it had a market value of $111,000. Make the journal entry necessary on the books of the compan
> The following aging of accounts receivable is as of the end of the year: Historical experience indicates the following: Age of Account ______________________Percentage Ultimately Uncollectible Less than 30 days . . . . . . . . . . . . . . . . . . . .
> Refer to the information in Practice 5-6. Compute cash paid for operating expenses. In Practice 5-6 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000 Cost of goods sol
> Refer to Practice 10-6. Make the journal entry necessary to record total interest paid for the year. Assume that all of the interest was paid in cash on December 31. In Practice 10-6 The company had the following loans outstanding for the entire year:
> Bad debt expense is estimated using the percentage-of-sales method. Total sales for the year were $600,000. The ending balance in Accounts Receivable was $100,000. Historically, bad debts have been 3% of total sales. The economic circumstances of credit
> Credit sales for the year were $150,000. Collections on account were $101,000. Make the necessary summary journal entries to record this information.
> The following summary data are for Gwynn Company: All current assets and current liabilities relate to operations. Instructions: 1. Compute net cash provided by (used in) operating activities for 2012 and 2013. 2. How would the numbers you computed in
> On December 31, 2013, analysis of Sayer Sporting Goods’ operations for 2013 revealed the following. (a) Total cash collections from customers, $105,260. (b) December 31, 2012, inventory balance, $12,180. (c) Total cash payments, $92,450. (d) Accounts rec
> The following data are for Ernst Company. (All inventory is purchased on account, and Accounts Payable relates only to the purchase of inventory.) INCOME STATEMENT DATA Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> A newly hired staff accountant prepared the pre-audit income statement of Be Fit Recreation Incorporated for the year ending December 31, 2013. The following information was obtained by Be Fit’s independent auditor. (a) Net revenues i
> Refer to the data for Novations, Inc., in Problem 5-47. In Problem 5-47 The table below shows the account balances of Novations, Inc., at the beginning and end of the company’s accounting period. The following additional information
> Selected account balances of Connell Company for 2013 along with additional information as of December 31 are as follows: Bad Debt Expense. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> The table below shows the account balances of Novations, Inc., at the beginning and end of the company’s accounting period. The following additional information is available: (a) All purchases and sales were on account. (b) Equipment
> The following financial statement information for Tronics Inc. is available: The following information relates to the firm’s common stock for the same period: Instructions: 1. For each year compute (a) Gross profit percentage. (b) R
> Sparkling Cleaner Company reported net income of $7,450 for 2013 but has been showing an overdraft in its bank account in recent months. The manager has contacted you as the auditor for an explanation. The comparative balance sheet was given to you for e
> In 2013, Laetner Industries decided to discontinue its Laminating Division, a separately identifiable component of Laetner’s business. At December 31, Laetner’s year-end, the division has not been completely sold. However, negotiations for the final and
> On June 4, Seller Company signed a sales agreement with Buyer Company to deliver and install a piece of factory equipment. The total contract price is $300,000. Customers usually buy an equipment/installation package, but Seller Company does sell equipme
> Comparative balance sheet data for the partnership of Bond and Wallin follow. Net income for the year was $22,000, and this was transferred in equal amounts to the partners’ capital accounts. Additional changes in the capital accounts
> Plush Textiles Inc. shows a retained earnings balance on January 1, 2013, of $580,000. For 2013, the income from continuing operations was $240,000 before income tax. Following is a list of special items: Income from operations of a discontinued textile
> Based on an analysis of the cash and other accounts, the following information was provided by the controller of Black Iron, Inc., a manufacturer of wood-burning stoves, for the year 2013. (a) Cash sales for the year were $210,000; sales on account total
> The following information relates to Spiker Manufacturing Inc. for the fiscal year ended July 31, 2013. Assume that there are no tax rate changes, a 30% tax rate applies to all items reported in the income statement, and there are no differences between
> The following information was obtained from analysis of selected accounts of Orlando Company for the year ended December 31, 2013. Increase in long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> On December 31, 2013, Hadley Company provides the following pre-audit income statement for your review: Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $185,00
> The following information was taken from the records of Glassett Produce Company for the year ended June 30, 2013. Borrowed on long-term notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $15,000 Issued
> Manchester Company manufactures and sells robot-type toys for children. Under one type of agreement with the dealers, Manchester is to receive payment upon shipment to the dealers. Under another type of agreement, Manchester receives payments only after
> Comparative balance sheet data for Tanzanite Imporium follow. In addition, new equipment was purchased for $60,000, payment consisting of $40,000 cash and a long-term note for $20,000. The short-term note payable was arranged with a supplier to finance i
> McGrath Co. on June 30, 2013, reported a retained earnings balance of $1,475,000 before closing the books. The books of the company showed the following account balances on June 30, 2013: Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
> What special accounting problems are introduced when a company purchases equipment on a deferred payment contract rather than with cash?
> Podracer Productions provides the following income statement for the year ended December 31, 2013: Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,530,600 Cos
> Ryan Company wishes to prepare a forecasted income statement and a forecasted balance sheet for 2014. Ryan’s balance sheet and income statement for 2013 follow. Balance Sheet _____________________________________________2013 Cash . . . . . . . . . . . .
> Ryan Company wishes to prepare a forecasted income statement, balance sheet, and statement of cash flows for 2014. Ryan’s balance sheet and income statement for 2013 follow: Balance Sheet ____________________________________________2013 Cash . . . . . .
> Romney and Associates wishes to forecast its net income for the year 2014. Romney has assembled balance sheet and income statement data for 2013 and has also done a forecast of the balance sheet for 2014. In addition, Romney has estimated that its sales
> Romney and Associates wishes to forecast its net income for the year 2014. In addition, for planning purposes Romney intends to construct a forecasted statement of cash flows for 2014. Romney has assembled balance sheet and income statement data for 2013
> Svedin Incorporated provides the following information relating to 2013: Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $14,200 Unrealized losses on available-fo
> Following are data from the financial statements for Houma Company. Compute the following for both 2012 and 2013: 1. Cash-flow-to-net-income ratio 2. Cash flow adequacy ratio 3. Cash times interest earned ratio
> J. Mair has been employed as a bookkeeper at Problems Inc. for a number of years. With the assistance of a clerk, Mair handles all accounting duties, including the preparation of financial statements. The following is a statement of earned surplus prepar
> The following information is available for Santiago Inc.: Compute the following for 2013: 1. Net income 2. Cash from operating activities
> Jacksonville Window Co. reports the following for 2013: Retained earnings, January 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $335,200 Selling expenses. . . . . . . . . . . . . . . . . . . . . . . . . . .
> The company reported the following information for the year: Ending work-in-process inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $100,000 Depreciation on factory building . . . . . . . . . . . . . . .
> The following information is available for Kelsey Inc. (All inventory is purchased on account, and Accounts Payable relates only to the purchase of inventory.) Compute the following for 2013: 1. The ending balance in accounts receivable 2. The amount o
