Handout 1-1
classic upholstery shop
tyler smith had worked in an upholstery shop for 10 years. last year, ty
lately, tyler had been unhappy with the shop's owner. convinced that he
that did better work at a lower cost, tyler decided to go into business form
upholstery shop.
year, tyler's wages were $20,000.
i that he could run an upholstery shop
ness for himself and opened classic
to get the business going, tyler decided to invest heavily in advertising. he spent pas
aimed at consumers and another $2,000 on advertising aimed at getting work it
interior design stores. tyler also purchased industrial sewing machines costing $4,000
and equipment costing $3,000. he estimated that the sewing machines can be used 10
before maintenance costs will be too high and the machines will need to be replaced.
equipment are not as durable and will have to be replaced in three years.
ing. he spent $6,000 on advertising
etting work from interior decorators and
machines costing $4,000 and other tools
machines can be used for about five years
eed to be replaced. the other tools and
ar
at the end of the first year of business, tyler had received $80,000 in cash from cus
work. tyler was owed another $2,500 from customers who are not required to pay ca
every 30 days.
$80,000 in cash from customers for upholstery
lot required to pay cash but are billed
a review of tyler's checkbook shows he paid the following expenses (in addition
previously) during the first year of business:
a the following expenses (in addition to those mentioned
upholstery fabric
other supplies
wages—part-time assistant
rent
insurance (two-year policy)
utilities
miscellaneous expenses
$40,000
10,000
9,500
4,800
3,200
2,500
1,700
tyler's utility bill for the last month of the year has not arrived. he estimates that the bill will be
approximately $320.
tyler keeps some stock of upholstery fabric in popular colors on hand for customers who do not want to
wait for special-order fabric to arrive. at the end of the year, about $14,000 of the fabric purchased
during the year was in his store stock. in addition, $2,300 in supplies had not been used.
how much profit did tyler make in his first year of business? do you think it was a good idea to open the upholstery shop, or would tyler be better
ff with his old job?

On april 1, 2017, jiro nozomi created a new travel agency, adventure travel. the following transactions occurred during the company’s first month. april 1 nozomi invested $30,000 cash and computer equipment worth $20,000 in the company in exchange for common stock.2 the company rented furnished office space by paying $1,800 cash for the first month's (april) rent.3 the company purchased $1,000 of office supplies for cash.10 the company paid $2,400 cash for the premium on a 12-month insurance policy. coverage begins on april 11.14 the company paid $1,600 cash for two weeks' salaries earned by employees.24 the company collected $8,000 cash on commissions from airlines on tickets obtained for customers.28 the company paid $1,600 cash for two weeks' salaries earned by employees.29 the company paid $350 cash for minor repairs to the company's computer.30 the company paid $750 cash for this month's telephone bill.30 the company paid $1,500 cash in dividends. the company's chart of accounts follows: 101 cash 405 commissions earned106 accounts receivable 612 depreciation expense—computer equip.124 office supplies 622 salaries expense128 prepaid insurance 637 insurance expense167 computer equipment 640 rent expense168 accumulated depreciation—computer equip. 650 office supplies expense209 salaries payable 684 repairs expense307 common stock 688 telephone expense318 retained earnings 901 income summary319 dividends use the following information: two-thirds (or $133) of one month’s insurance coverage has expired. at the end of the month, $600 of office supplies are still available. this month’s depreciation on the computer equipment is $500.employees earned $420 of unpaid and unrecorded salaries as of month-end. the company earned $1,750 of commissions that are not yet billed at month-end. required: 1. & 2. prepare journal entries to record the transactions for april and post them to the ledger accounts in requirement 6b. the company records prepaid and unearned items in balance sheet accounts.3. using account balances from requirement 6b, prepare an unadjusted trial balance as of april 30.4. journalize and post the adjusting entries for the month and prepare the adjusted trial balance.5a. prepare the income statement for the month of april 30, 2017.5b. prepare the statement of retained earnings for the month of april 30, 2017.5c. prepare the balance sheet at april 30, 2017.6a. prepare journal entries to close the temporary accounts and then post to requirement 6b.6b. post the journal entries to the ledger.7. prepare a post-closing trial balance.

The uptowner just paid an annual dividend of $4.12. the company has a policy of increasing the dividend by 2.5 percent annually. you would like to purchase shares of stock in this firm but realize that you will not have the funds to do so for another four years. if you require a rate of return of 16.7 percent, how much will you be willing to pay per share when you can afford to make this investment?

Which of the following is not one of the four principles of bottleneck management? a. increasing capacity at non-bottleneck stations is a mirageb. lost time at the bottleneck is lost system capacity. c. release work orders to the system at the bottleneck's capacity pace. d. increased bottleneck capacity is increased system capacity. e. bottlenecks should be moved to the end of the system process.