9. On December 11, 2015, Jaron Co received magazine subscriptions for 2016 in cash for $200. Make the entry to record the receipt of this cash in 2015.
10. If you buy lunch for $16.35 that includes 9% sales tax, how much did the restaurant charge you for lunch and how much do they owe for sales taxes?
11. United Supply has a $25 million liability at December 31, 2015, of which $5 million is payable in each of the next five years. What portion of the $25 million is current and what amount is long term at 12/31/15?
Current:_________________________ Long-term: ___________________________
12. For each of the following, determine the correct way to treat the situation: i.e. record in the books, disclosure required or no reporting needed and any amount that is to be reported or disclosed.
a. The likelihood of a payment occurring is probable, and the estimated amount is $1.3 million
b. The likelihood of a payment occurring is probable, and the amount is estimated to be in the range of $1.1 million to $1.6 million.
c. The likelihood of a payment occurring is reasonably possible, and the estimated amount is $1.3 million.
d. The likelihood of a payment occurring is remote, while the estimated potential amount is $1.3 million.
13. Axel Inc offers its employees free medical, dental and life insurance coverage. It also matches employee contributions to a voluntary retirement plan dollar for dollar. Assume that no employee's wages exceed the relevant wage bases. Payroll information for the payroll period ending January 15 are below. Make the appropriate journal entries in good form to record the payroll.
Wages and salaries $2,750,000.00
Employee contributions to voluntary retirement plan $130,000.00
Medical Insurance premiums paid by employer $50,000.00
Dental Insurance premiums paid by employer $17,500.00
Life Insurance premiuims paid by employer $8,750.00
Federal and state income tax withheld $540,000.00
FICA rate 7.65%
Federal and state unemployment tax rate 6.20%
9. On December 11, 2015, Jaron Co received magazine subscriptions for 2016 in cash for $200. Make the entry to record the receipt of this cash in 2015.
10. If you buy lunch for $16.35 that includes 9% sales tax, how much did the restaurant charge you for lunch and how much do they owe for sales taxes?
11. United Supply has a $25 million liability at December 31, 2015, of which $5 million is payable in each of the next five years. What portion of the $25 million is current and what amount is long term at 12/31/15?
Current:_________________________ Long-term: ___________________________
12. For each of the following, determine the correct way to treat the situation: i.e. record in the books, disclosure required or no reporting needed and any amount that is to be reported or disclosed.
a. The likelihood of a payment occurring is probable, and the estimated amount is $1.3 million
b. The likelihood of a payment occurring is probable, and the amount is estimated to be in the range of $1.1 million to $1.6 million.
c. The likelihood of a payment occurring is reasonably possible, and the estimated amount is $1.3 million.
d. The likelihood of a payment occurring is remote, while the estimated potential amount is $1.3 million.
13. Axel Inc offers its employees free medical, dental and life insurance coverage. It also matches employee contributions to a voluntary retirement plan dollar for dollar. Assume that no employee's wages exceed the relevant wage bases. Payroll information for the payroll period ending January 15 are below. Make the appropriate journal entries in good form to record the payroll.
Wages and salaries $2,750,000.00
Employee contributions to voluntary retirement plan $130,000.00
Medical Insurance premiums paid by employer $50,000.00
Dental Insurance premiums paid by employer $17,500.00
Life Insurance premiuims paid by employer $8,750.00
Federal and state income tax withheld $540,000.00
FICA rate 7.65%
Federal and state unemployment tax rate 6.20%
Related questions
Arlington Corporation's financial statements (dollars and sharesare in millions) are provided here.
| Balance Sheetsas of December 31 | |||
| 2016 | 2015 | ||
| Assets | |||
| Cash and equivalents | $ 14,000 | $ 12,000 | |
| Accounts receivable | 35,000 | 30,000 | |
| Inventories | 32,135 | 29,000 | |
| Total currentassets | $ 81,135 | $ 71,000 | |
| Net plant and equipment | 53,000 | 49,000 | |
| Total assets | $134,135 | $120,000 | |
| Liabilities andEquity | |||
| Accounts payable | $ 10,200 | $ 9,500 | |
| Accruals | 8,000 | 6,000 | |
| Notes payable | 6,900 | 5,300 | |
| Total currentliabilities | $ 25,100 | $ 20,800 | |
| Long-term bonds | 15,000 | 15,000 | |
| Total liabilities | $ 40,100 | $ 35,800 | |
| Common stock (4,000 shares) | 50,000 | 50,000 | |
| Retained earnings | 44,035 | 34,200 | |
| Common equity | $ 94,035 | $ 84,200 | |
| Total liabilities and equity | $134,135 | $120,000 | |
| IncomeStatement for Year Ending December 31, 2016 | |
| Sales | $208,000 |
| Operating costs excludingdepreciation and amortization | 160,000 |
| EBITDA | $ 48,000 |
| Depreciation &amortization | 6,000 |
| EBIT | $ 42,000 |
| Interest | 6,250 |
| EBT | $ 35,750 |
| Taxes (40%) | 14,300 |
| Net income | $ 21,450 |
| Dividends paid | 11,615 |
Enter your answers in millions. For example, an answer of$25,000,000,000 should be entered as 25,000.
What was net operating working capital for 2015 and 2016?
| 2015 | $ million |
| 2016 | $ million |
What was Arlington's 2016 free cash flow?
$ million
Construct Arlington's 2016 statement of stockholders'equity.
| CommonStock | Retained Earnings | TotalStockholders' Equity | ||
| Shares | Amount | |||
| Balances, 12/31/15 | million | $ million | $ million | $ million |
| 2016 Net Income | million | |||
| Cash Dividends | million | |||
| Addition to retained earnings | million | |||
| Balances, 12/31/16 | million | $ million | $ million | $ million |
What was Arlington's 2016 EVA? Assume that its after-tax cost ofcapital is 10%. Round your answer to two decimal places.
$ million
What was Arlington's MVA at year-end 2016? Assume that its stockprice at December 31, 2016 was $25.
