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RECORDING BUSINESS TRANSACTIONS
STUDENT: ROMANA ADAS
STUDENT ID:22126156
Introduction
There have been a number of British manufacturing subsidiaries of Toyota Motor Manufacturing (UK) Ltd. since 1989. It is a subsidiary of the Japanese company. Approximately half of the company's
products are manufactured in Burnaston, Derbyshire, and the other half in Deeside, North Wales. A 3 year period was required to build the Burnaston factory after the demolition of the Burnaston House in March 1990, and the factory was completed just after the demolition of the Burnaston House.
Sixty seconds are needed to produce a single car at the fastest possible speed. In the Toyota Technology Challenge, Toyota Manufacturing UK and Rapid Electronics host a national engineering and technology competition for secondary students.
Accounting in the Car manufacturing business
Generally, General Ledgers are used to post, summarize, and report financial information. Business documents are primarily used to create General Ledger entries. For each business transaction, purchase invoices are typically required. Shoaib, 2022) will enable you to access account balances and general ledger accounts.
Importance of accounting in the automotive industry
A major part of the economy, and perhaps the most significant part of the economy, is the automobile industry. The total value of this industry exceeds a billion dollars in conclusion. Consequently, without the millions of workers employed in the automotive industry, it would not be possible to achieve global economic growth.
In order to meet the needs of these individuals, the automotive industry produces more than 65 million automobiles every year. Aside from that, there are a number of parties that are involved in this business. As a final point, I would like to mention that there are three main categories of automobile manufacturers:
OEM's (Original Equipment Manufacturers) are a group of companies that design and manufacture automobiles as well as sell them to customers.
Automotive manufacturers (OEMs), suppliers of auto parts and components, automotive finance companies are just a few of the businesses that make up the automotive industry (Accounting by Manufacturing Companies, no date). They include retailers of automobiles for the general public, OEMs, suppliers of auto parts and components, and automotive finance companies.
Likewise, car showrooms offer a wide variety of services to their clients, including sales, fixes, inspections, electronic testing, bodywork, and maintenance, in addition to a variety of other services. The process of creating a chart of accounts for a business that sells and repairs automobiles
is not as complex as you might have thought it to be.
Accounting process
In accounting, there are rules regarding the recording of sales
In order to gain a thorough understanding of your company's operations and the consequent
adequate gross margin, you must contemplate the different types of automobile transactions
generated by your F&I programs.
Thus, it is critical to properly structure your F&I program to ensure that your accounting transactions
are accurately documented and you have the most important information available for a business
investigation.
A general retail ledger should record retail prime and subprime vehicle transactions separately using
GAAP rules (Quatrro - Financial and Accounting Outsourcing Solutions, 2022).
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Retail business transactions
A client purchased stock for $7,500, so the initial price was $7,000, but reconditioning required at least $500, so trading is not permitted.
An extended service contract and CL&AH insurance are included with the $9,500 purchase price. During the period when a client is obtaining financing for the purchase of the vehicle, you can reserve the vehicle. As a first step, journal entries should always be recorded. An example would be a manufacturing company that purchases raw materials from a supplier, TLM company.
After the cycle has been completed, the closing entries are created. We have closed the manufacturing income summary account. Income statements eventually remove retained earnings. Close the manufacturing accounts first. As a result of the schedule of taxes and income statement in Red Car, Inc., subsequent closing entries are based on those accounts.
Accounting cycle
When organizations think about how they did previously, they need to follow a specific arrangement
of steps for ensuring that the financials they have are accurate, so that they can have a clear picture of how they did. As a rule, these means are referred to as the accounting cycle since they rehash the same essentials after each accounting period.
A company's financial statements are prepared based on the steps taken in a company's accounting cycle in order to ensure that each dollar transferred before, during, and after the accounting period is correctly accounted for and reflected therein. In order for companies to be able to maintain their historical records, it is very important that their financial statements are as accurate as possible. Investors, the IRS, banks, and others will examine your financial statements to determine whether or
not to offer you a loan or whether or not you have paid the appropriate amount of taxes to make a decision on whether to provide you with a loan or not (What Is The Accounting Cycle? no date).
You can compare the accounting cycle with a checklist you need to complete at the end of the accounting period. As soon as each step has been completed, you will be able to start fresh with your next accounting period.
Throughout each accounting period, the activities in this cycle are repeated on a monthly, quarter, and yearly basis, depending on what accounting period is being used. There will be many steps in the
accounting cycle that we will be able to examine individually and you will be able to understand exactly what actions are required for the next step.
The accounting cycle reflects the rules and procedures that all businesses have to adhere to if they are to achieve accurate numbers. This is why it is important to be aware of all steps, even those that are taking place behind the scenes. As technology and accounting continue to mix, the accounting process continues to become significantly less manual and much faster as the amount of manual work continues to decrease.
Reference
Accounting
by
Manufacturing
Companies
(no
date).
Available
at:
https://www.cliffsnotes.com/study-guides/accounting/accounting-principles-ii/
managerial-and-cost-accounting-concepts/accounting-by-manufacturing-companies.
Quatro - Financial and Accounting Outsorcing Solutions (2021) Automtive Accounting &
Bookeeping Services | Quattro
. Available at: https://www.quatrrobss.com/industries-
finance-and-accounting/automotive/.
Shoaib, W. (2022) How to Do Bookeping for the Automotive Industry?
Available at:
https://oakbusinessconsultant.com/coa-bookkeeping-for-the-automotive-industry-2/.
What Is The Accounting Cycle?
(no date). Available at: https://scalefactor.com/ask-the-
experts/the-accounting-cycle/.
Related Documents
Related Questions
Please do not give image format
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Required information
Blackwater Spring and Metal utilizes the same computerized spring-forming machinery in its U.S. and Malaysian plants.
The first cost was $750,000 with S= $150,000 aftern= 10 years. MACRS (Modified Accelerated Cost Recovery
System) depreciation with n=5 years is applied in the United States, and standard SL depreciation with n= 10 years is
used by the Malaysian facility.
Depreciation Rate (%) for Each MACRS Recovery Period in Years
Year
n=3
n=5
n=7
n= 10
n=15
n= 20
33.33
20.00
14.29
10.00
5.00
3.75
44.45
32.00
24.49
18.00
9.50
7.22
14.81
19.20
17.49
14.40
8.55
6.68
4.
7.41
11.52
12.49
I1.52
7.70
6.18
11.52
8.93
9.22
6.93
5.71
6.
5.76
8.92
7.37
.6.23
5.29
17
8.93
6.55
5.90
4.89
4.46
6.55
5.90
4.52
6.56
5.91
4.46
10
6.55
5.90
4.46
3.28
5.91
4.46
12
5.90
4.46
13
5.91
4.46
14
5.90
4.46
15
5.91
4.46
2.95
4.46
16
4.46
17-20
2.23
21
Use a spreadsheet to plot the book values for both methods on a single graph. (Please upload your response/solution using the controls below.)
arrow_forward
Requireu iIONiation
Use the following information for the Exercises below.
[The following information applies to the questions displayed below.]
Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of
$47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value.
During its second year, the machine produces 34,500 units of product.
Exercise 8-5 Units-of-production depreciation LO P1
Determine the machine's second-year depreciation using the units-of-production method.
Units-of-production Depreciation
Choose Numerator:
Choose Denominator:
Annual Depreciation Expense
%3D
Depreciation expense per unit
Year Annual Production (units)
Depreciation Expense
arrow_forward
please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image)
arrow_forward
Slater & Sons Corp manufactures electronic components for use in many consumer products. Their raw materials are purchased literally from all over the world. Depending on the country involved, purchase terms vary widely. Some suppliers, for example, require full prepayment, while others are content to receive payment within six months of receipt of the goods.
Because of this situation, Slater never closes its books until at least ten days after month end. In this way, it can sort out ownership of goods in transit, and document which goods were received by month end, and which were not.
Drew Bolton, a new accountant, was asked to record about $50,000 in inventory as having been received before month end. He argued that the shipping documents clearly showed that the goods were actually received on the 8th of the current month. His boss, busy with month-end reports, curtly tells Drew to check the shipping terms. He did so, and found the notation "FOB (free on board) shipper's dock" on…
arrow_forward
Whitehill Chemicals has two operating divisions. Its Formulation Division in the United States mixes,
processes, and tests basic chemicals, and then ships them to Ireland, where the company's
Commercial Division uses the chemicals to produce and sell various products. Operating expenses
amount to $26.6 million in the U.S. and $78.6 million in Ireland exclusive of the costs of any goods
transferred from the U.S. Revenues in Ireland are $201 million.
If the chemicals were purchased from one of the company's Irish mixing divisions, the costs would be
$39.6 million. However, if it had been purchased from an independent U.S. supplier, the cost would be
$52.6 million. The marginal income tax rate is 20 percent in the U.S. and 12 percent in Ireland.
Required:
What is the company's total tax liability to both jurisdictions for each of the two alternative transfer
pricing scenarios ($39.6 million and $52.6 million)?
Note: Enter your answers in dollars and not in millions of dollars.
Total tax…
arrow_forward
Whitehill Chemicals has two operating divisions. Its Formulation Division in the United States mixes, processes, and tests basic
chemicals, and then ships them to Ireland, where the company's Commercial Division uses the chemicals to produce and sell various
products. Operating expenses amount to $27.2 million in the U.S. and $79.2 million in Ireland exclusive of the costs of any goods
transferred from the U.S. Revenues in Ireland are $207 million.
If the chemicals were purchased from one of the company's Irish mixing divisions, the costs would be $40.2 million. However, if it had
been purchased from an independent U.S. supplier, the cost would be $53.2 million. The marginal income tax rate is 20 percent in the
U.S. and 12 percent in Ireland.
Required:
What is the company's total tax liability to both jurisdictions for each of the two alternative transfer pricing scenarios ($40.2 million and
$53.2 million)?
Note: Enter your answers in dollars and not in millions of dollars.
Total tax…
arrow_forward
Help me please
arrow_forward
Required information
Use the following information for the Exercises below. (Algo)
[The following information applies to the questions displayed below.]
Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of
$83,600. The machine's useful life is estimated at 20 years, or 398,000 units of product, with a $4,000 salvage value.
During its second year, the machine produces 33,800 units of product.
Exercise 8-5 (Algo) Units-of-production depreciation LO P1
Determine the machine's second-year depreciation using the units-of-production method.
Units-of-production Depreciation
Choose Numerator:
Choose Denominator:
Annual Depreciation Expense
Cost minus salvage
= Depreciation expense per unit
79 600
Year
Annual Production (units)
Depreciation Expense
Year 2
search
10:21 AM
(96)
68°F
10/1/2021
144
440
prt sc
delete
home
96
80
backspace
mUrn
lock
RI
H.
enter
B.
arrow_forward
Required information
Use the following information for the Exercises below. (Algo)
[The following information applies to the questions displayed below.]
Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of
$83,600. The machine's useful life is estimated at 20 years, or 398,000 units of product, with a $4,000 salvage value.
During its second year, the machine produces 33,800 units of product.
Exercise 8-4 (Algo) Straight-line depreciation LO P1
Determine the machine's second-year depreciation and year end book value under the straight-line method.
Straight-Line Depreciation
Choose Numerator: /
Annual Depreciation
Expense
Choose Denominator:
= Depreciation expense
Year 2 Depreciation
Year end book value (Year 2)
e to search
O 68°F
a
144
prt sc
delete
96
&
Y
K
arrow_forward
Required information
Use the following information for the Exercises below.
[The following information applies to the questions displayed below.]
Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of
$47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value.
During its second year, the machine produces 34,500 units of product.
Exercise 8-6 Double-declining-balance depreciation LO P1
Determine the machine's second-year depreciation using the double-declining-balance method.
Double-declining-balance Depreciation
es
Annual Depreciation
Expense
Depreciation expense
Choose Factors:
Choose Factor(%)
!!
First year's depreciation
Second year's depreciation
%3D
arrow_forward
Required information
Use the following information for the Exercises below.
Skip to question
[The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $43,500. The machine’s useful life is estimated at 10 years, or 385,000 units of product, with a $5,000 salvage value. During its second year, the machine produces 32,500 units of product.
Exercise 8-6 Double-declining-balance depreciation LO P1
Determine the machine’s second-year depreciation using the double-declining-balance method.
Required information
Use the following information for the Exercises below.
Skip to question
[The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $43,500. The machine’s useful life is estimated at 10 years, or 385,000 units of…
arrow_forward
Required information
Use the following information for the Exercises below. (Algo)
Skip to question
[The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $44,200. The machine's useful life is estimated at 10 years, or 392,000 units of product, with a $5,000 salvage value. During its second year, the machine produces 33,200 units of product.
Exercise 8-6 (Algo) Double-declining-balance depreciation LO P1
Determine the machine’s second-year depreciation using the double-declining-balance method.
arrow_forward
Required information
Use the following information for the Exercises below. (Algo)
Skip to question
[The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $44,200. The machine's useful life is estimated at 10 years, or 392,000 units of product, with a $5,000 salvage value. During its second year, the machine produces 33,200 units of product.
Exercise 8-4 (Algo) Straight-line depreciation LO P1
Determine the machine’s second-year depreciation and year end book value under the straight-line method.
arrow_forward
Please do not give solution in image format thanku
arrow_forward
Required information
Use the following information for the Exercises below.
[The following information applies to the questions displayed below.]
Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of
$47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value.
During its second year, the machine produces 34,500 units of product.
Exercise 8-4 Straight-line depreciation LO P1
Determine the machine's second-year depreciation and year end book value under the straight-line method.
Straight-Line Depreciation
Annual Depreciation
Expense
Choose Numerator: /
Choose Denon
tor:
!!
Depreciation expense
%3D
Year 2 Depreciation
Year end book value (Year 2)
arrow_forward
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Related Questions
- Please do not give image formatarrow_forwardRequired information Blackwater Spring and Metal utilizes the same computerized spring-forming machinery in its U.S. and Malaysian plants. The first cost was $750,000 with S= $150,000 aftern= 10 years. MACRS (Modified Accelerated Cost Recovery System) depreciation with n=5 years is applied in the United States, and standard SL depreciation with n= 10 years is used by the Malaysian facility. Depreciation Rate (%) for Each MACRS Recovery Period in Years Year n=3 n=5 n=7 n= 10 n=15 n= 20 33.33 20.00 14.29 10.00 5.00 3.75 44.45 32.00 24.49 18.00 9.50 7.22 14.81 19.20 17.49 14.40 8.55 6.68 4. 7.41 11.52 12.49 I1.52 7.70 6.18 11.52 8.93 9.22 6.93 5.71 6. 5.76 8.92 7.37 .6.23 5.29 17 8.93 6.55 5.90 4.89 4.46 6.55 5.90 4.52 6.56 5.91 4.46 10 6.55 5.90 4.46 3.28 5.91 4.46 12 5.90 4.46 13 5.91 4.46 14 5.90 4.46 15 5.91 4.46 2.95 4.46 16 4.46 17-20 2.23 21 Use a spreadsheet to plot the book values for both methods on a single graph. (Please upload your response/solution using the controls below.)arrow_forwardRequireu iIONiation Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 34,500 units of product. Exercise 8-5 Units-of-production depreciation LO P1 Determine the machine's second-year depreciation using the units-of-production method. Units-of-production Depreciation Choose Numerator: Choose Denominator: Annual Depreciation Expense %3D Depreciation expense per unit Year Annual Production (units) Depreciation Expensearrow_forward
- please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image)arrow_forwardSlater & Sons Corp manufactures electronic components for use in many consumer products. Their raw materials are purchased literally from all over the world. Depending on the country involved, purchase terms vary widely. Some suppliers, for example, require full prepayment, while others are content to receive payment within six months of receipt of the goods. Because of this situation, Slater never closes its books until at least ten days after month end. In this way, it can sort out ownership of goods in transit, and document which goods were received by month end, and which were not. Drew Bolton, a new accountant, was asked to record about $50,000 in inventory as having been received before month end. He argued that the shipping documents clearly showed that the goods were actually received on the 8th of the current month. His boss, busy with month-end reports, curtly tells Drew to check the shipping terms. He did so, and found the notation "FOB (free on board) shipper's dock" on…arrow_forwardWhitehill Chemicals has two operating divisions. Its Formulation Division in the United States mixes, processes, and tests basic chemicals, and then ships them to Ireland, where the company's Commercial Division uses the chemicals to produce and sell various products. Operating expenses amount to $26.6 million in the U.S. and $78.6 million in Ireland exclusive of the costs of any goods transferred from the U.S. Revenues in Ireland are $201 million. If the chemicals were purchased from one of the company's Irish mixing divisions, the costs would be $39.6 million. However, if it had been purchased from an independent U.S. supplier, the cost would be $52.6 million. The marginal income tax rate is 20 percent in the U.S. and 12 percent in Ireland. Required: What is the company's total tax liability to both jurisdictions for each of the two alternative transfer pricing scenarios ($39.6 million and $52.6 million)? Note: Enter your answers in dollars and not in millions of dollars. Total tax…arrow_forward
- Whitehill Chemicals has two operating divisions. Its Formulation Division in the United States mixes, processes, and tests basic chemicals, and then ships them to Ireland, where the company's Commercial Division uses the chemicals to produce and sell various products. Operating expenses amount to $27.2 million in the U.S. and $79.2 million in Ireland exclusive of the costs of any goods transferred from the U.S. Revenues in Ireland are $207 million. If the chemicals were purchased from one of the company's Irish mixing divisions, the costs would be $40.2 million. However, if it had been purchased from an independent U.S. supplier, the cost would be $53.2 million. The marginal income tax rate is 20 percent in the U.S. and 12 percent in Ireland. Required: What is the company's total tax liability to both jurisdictions for each of the two alternative transfer pricing scenarios ($40.2 million and $53.2 million)? Note: Enter your answers in dollars and not in millions of dollars. Total tax…arrow_forwardHelp me pleasearrow_forwardRequired information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $83,600. The machine's useful life is estimated at 20 years, or 398,000 units of product, with a $4,000 salvage value. During its second year, the machine produces 33,800 units of product. Exercise 8-5 (Algo) Units-of-production depreciation LO P1 Determine the machine's second-year depreciation using the units-of-production method. Units-of-production Depreciation Choose Numerator: Choose Denominator: Annual Depreciation Expense Cost minus salvage = Depreciation expense per unit 79 600 Year Annual Production (units) Depreciation Expense Year 2 search 10:21 AM (96) 68°F 10/1/2021 144 440 prt sc delete home 96 80 backspace mUrn lock RI H. enter B.arrow_forward
- Required information Use the following information for the Exercises below. (Algo) [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $83,600. The machine's useful life is estimated at 20 years, or 398,000 units of product, with a $4,000 salvage value. During its second year, the machine produces 33,800 units of product. Exercise 8-4 (Algo) Straight-line depreciation LO P1 Determine the machine's second-year depreciation and year end book value under the straight-line method. Straight-Line Depreciation Choose Numerator: / Annual Depreciation Expense Choose Denominator: = Depreciation expense Year 2 Depreciation Year end book value (Year 2) e to search O 68°F a 144 prt sc delete 96 & Y Karrow_forwardRequired information Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 34,500 units of product. Exercise 8-6 Double-declining-balance depreciation LO P1 Determine the machine's second-year depreciation using the double-declining-balance method. Double-declining-balance Depreciation es Annual Depreciation Expense Depreciation expense Choose Factors: Choose Factor(%) !! First year's depreciation Second year's depreciation %3Darrow_forwardRequired information Use the following information for the Exercises below. Skip to question [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $43,500. The machine’s useful life is estimated at 10 years, or 385,000 units of product, with a $5,000 salvage value. During its second year, the machine produces 32,500 units of product. Exercise 8-6 Double-declining-balance depreciation LO P1 Determine the machine’s second-year depreciation using the double-declining-balance method. Required information Use the following information for the Exercises below. Skip to question [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $43,500. The machine’s useful life is estimated at 10 years, or 385,000 units of…arrow_forward
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