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You are applying the scattergraph method and find that the regression line you have drawn passes through a data point with the following coordinates: 7,500 units and $10,000. The regression line passes through the Y axis at the $4,000 point. Which of the following is the cost formula that represents the slope of this line?You are applying the scattergraph method and find that the regression line you have drawn passes through a data point with the following coordinates: 7,500 units and $10,000. T

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Randelle James Fiesta
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236 views

Post Quiz 1

You are applying the scattergraph method and find that the regression line you have drawn passes through a data point with the following coordinates: 7,500 units and $10,000. The regression line passes through the Y axis at the $4,000 point. Which of the following is the cost formula that represents the slope of this line?You are applying the scattergraph method and find that the regression line you have drawn passes through a data point with the following coordinates: 7,500 units and $10,000. T

Uploaded by

Randelle James Fiesta
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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POST QUIZ 1-CHAPTER 1-CAE06

1. The ledger of COLTISH UNDISCIPLINED Co. in 20x1 includes the following:


Jan. 1, Dec. 31,
20x1 20x1
Current assets 1,200,000 1,600,000
Noncurrent assets 4,000,000 2,600,000
Current liabilities 900,000 1,000,000
Noncurrent liabilities 5,500,000 3,000,000
Additional information:
- COLTISH’s working capital as of December 31, 20x1 is twice as much as the working
capital as of January 1, 20x1.
- Total equity as of January 1, 20x1 is ₱1,700,000. Profit for the year is ₱2,400,000 while
dividends declared amounted to ₱1,000,000. There were no other changes in equity during
the year.
How much is the total current assets as of December 31, 20x1?
Ans.
Solution:
Working capital = Current assets – Current liabilities
Working capital, Jan. 1, 20x1 = 1,200,000 – 900,000
Working capital, Jan. 1, 20x1 = 300,000

Working capital, Dec. 31, 20x1 = Working capital, Jan. 1, 20x1 times 2
Working capital, Dec. 31, 20x1 = 300,000 x 2 = 600,000

Working capital = Current assets – Current liabilities


600,000 = Current assets, Dec. 31, 20x1 – 1,000,000
Current assets, Dec. 31, 20x1 = 1,600,000

2. WASHY PALE Co. has the following information on December 31, 20x1: l Cost of sales is
₱260,000. l Operating expenses are 13% of sales and 20% of cost of sales. l Interest
expense is 5% of sales. l Income tax rate is 30%. There were no temporary differences
during the year. How much is the profit for the year?
Ans.
Solution:
Cost ratio is derived from the percentages of operating expenses over sales and cost
of sales as follows: Cost ratio = 13% / 20% = 65%

Amount
Sales 400,000 (260,000 COS ÷ 65%)

Cost of sales (260,000) (start)

Gross profit 140,000


Operating (400,000 x 13%) or (260,000
expenses (52,000) x 20%)

Interest expense (20,000) (400,000 x 5%)


Profit before tax 68,000
Income tax expense (20,400) (40,000 x 30%)

Profit after tax 47,600

3. The ledger of COLTISH UNDISCIPLINED Co. in 20x1 includes the following:


Jan. 1, Dec. 31,
20x1 20x1
Current assets 1,200,000 1,600,000
Noncurrent assets 4,000,000 2,600,000
Current liabilities 900,000 1,000,000
Noncurrent liabilities 5,500,000 3,000,000

Additional information:
- COLTISH’s working capital as of December 31, 20x1 is twice as much as the working
capital as of January 1, 20x1.
- Total equity as of January 1, 20x1 is ₱1,700,000. Profit for the year is ₱2,400,000 while
dividends declared amounted to ₱1,000,000. There were no other changes in equity during
the year.
How much is the total noncurrent assets as of December 31, 20x1?
Ans.
Solution:
Equity
1,700,000 Jan. 1
Dividends 1,000,000 2,400,000 Profit for the year
Dec. 31 3,100,000

Assets = Liabilities + Equity


(1,600,000 + Noncurrent assets) = (1,000,000 + 3,000,000) + 3,100,000
Noncurrent assets, Dec. 31, 20x1 = 4,000,000 + 3,100,000 – 1,600,000
Noncurrent assets, Dec. 31, 20x1 = 5,500,000

4. PRENTICE A LEARNER Co. reported profit after tax of ₱210,000. PRENTICE’s


income tax rate is 30%. Operating expenses for the year is 15% of sales and 25% of
cost of sales. Other expenses were 10% of sales. How much is the total sales?
Ans.
Solution:
Sales 100%
Cost of sales (15% / 25%) (60%)
Gross profit 40%
Operating expenses (15% of 100%) or (25% of 60%) (15%)
Other expenses (10% of 100%) (10%)
Profit before tax 15%

The profit after tax given in the problem is translated to profit before tax as shown
below:
Profit after tax (given) 210,000
Divide by: (100% less 30% tax rate) 70%
Profit before tax 300,000
Sales (300,000 Profit before tax ÷ 15%) 2,000,000

5. The ledger of COLTISH UNDISCIPLINED Co. in 20x1 includes the following:


Jan. 1, Dec. 31,
20x1 20x1
Current assets 1,200,000 1,600,000
Noncurrent assets 4,000,000 2,600,000
Current liabilities 900,000 1,000,000
Noncurrent liabilities 5,500,000 3,000,000

Additional information:
- COLTISH’s working capital as of December 31, 20x1 is twice as much as the
working capital as of January 1, 20x1.
- Total equity as of January 1, 20x1 is ₱1,700,000. Profit for the year is ₱2,400,000
while dividends declared amounted to ₱1,000,000. There were no other changes in
equity during the year.
How much is the total noncurrent liabilities as of January 1, 20x1?
Ans.
Solution:
Assets = Liabilities + Equity
(1,200,000 + 4,000,000) = (900,000 + Noncurrent liabilities) + 1,700,000
Noncurrent liabilities = 5,200,000 – 900,000 – 1,700,000
Noncurrent liabilities, Jan. 1, 20x1 = 2,600,000

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