Answer:
$54,000 cost basis in ABC; $6,000 cost basis in DEF
Explanation:
The original cost basis is the price that was paid for the shares. This means that 1,000 shares at $60 each gives a cost basis of $60,000.
Now if the subsidiary DEF is worth 10% of ABC which has a cost basis of $60,000, then the share of DEF that customers will have will be 10% of $60,000.
(10÷100) x $60,000 = 0.1 x $60,000
= $6,000.
Now, if DEF is worth $6,000 (i.e 10%) of ABC, then ABC's worth will now be $60,000 - $6,000 = $54,000.
The original cost basis is that price that was paid for the shared initially. This means that it has no effect on the increase in value of the shares.
Cheers.
Suppose the countries of Iceland and Norway set up a free trade area, eliminating all trade barriers between themselves but maintaining tariffs on imports from the rest of the world. Now, Iceland begins to import wool from Norway. However, Iceland had previously been importing wool from England, which produced wool more cheaply than both Iceland and Norway. What is this an example of
Answer:
Trade Bloc
Explanation:
Trade Bloc is a type of agreement between two sovereign nations in which barriers to trade are either reduced or totally eliminated between the two nations. This type of agreement can either be one agreement between several nations or a part of a regional organization.
So, the example of Iceland and Norway is an example of a trade bloc.
Global Technology’s capital structure is as follows: Debt 15 % Preferred stock 50 Common equity 35 The aftertax cost of debt is 6.00 percent; the cost of preferred stock is 10.00 percent; and the cost of common equity (in the form of retained earnings) is 13.00 percent. Calculate the Global Technology’s weighted cost of each source of capital and the weighted average cost of capital.
Answer:
1. 0.9% ; 5% ; 4.55%
2. 10.45%
Explanation:
Cost of equity = 13%
After tax cost of debt= 6%
Cost of preferred stock = 10%
Weight of debt = 15%
Weight of preferred stock = 50%
Weight of equity = 35%
Therefore;
1
•After tax weighted cost of debt = weight of debt × after tax cost of debt
= 0.15 × 0.06
= 0.009
= 0.9%
•Weighted preferred stock cost = Weight of preferred stock × cost of preferred stock
= 0.50 × 0.10
= 0.05
= 5%
•Weighted common equity stock cost = weight of equity × cost of equity
= 0.35 × 0.13
= 0.0455
= 4.55%
2.
• Weighted average cost of the firm
= After tax weighted cost of debt + Weighted preferred stock cost + Weighted common equity stock cost
= 0.9% + 5% + 4.55%
= 10.45%
You invest $100 in stocks and sell them one year later for $115. Use the instructions in Lesson 3 to calculate the ROI dollar amount and percentage. (2.0 points) TIP: Subtract the initial investment from the total return to get the ROI dollar amount. Then divide the ROI dollar amount by the initial investment, and multiply that number by 100 to get the percentage.
Answer:
ROI in dollar amount = $15
ROI in percentage = 15%
Explanation:
Given:
Initial investment = $100
Sale value = $115
Find:
ROI in dollar amount
ROI in percentage
Computation:
⇒ ROI in dollar amount = Sale value - Initial investment
ROI in dollar amount = $115 - $100
ROI in dollar amount = $15
⇒ ROI in percentage = [ROI in dollar amount / Initial investment]100
ROI in percentage = [$15 / $100]100
ROI in percentage = 15%
Answer:
15%
Explanation:
Joe Jones, the proprietor of Joe Jones Financial Planning Inc., which is registered as an investment adviser in New York State, has decided that he can expand his business by setting up an Internet website. He includes a questionnaire that solicits individuals to transmit information about their investment objective, financial situation, financial needs, risk tolerance level and investment time horizon, which he will use to create a financial model and plan for a fee. Which statement is TRUE
Available Options are:
A. Joe Jones financial planning Inc. must register with the S EC as an investment advisor but is not required to register as an investment advisor in each state where customers complete the questionnaire
B. Joe Jones financial planning Inc. is not required to register with the SEC as an investment advisor, but the firm is required to register as an investment advisor in each state where customers complete the questionnaire
C. Joe Jones financial planning Inc. is required to register with the SEC as an investment advisor, and the firm is required to register as an investment advisor in each state where customers complete the questionnaire
Answer:
Option B is correct.
Explanation:
Because the reason is that Joe Jones financial planning Inc., is not a large size firm hence they are not required to register with the SEC whereas they are required to register as an investment advisor in each state where they are operational as an investment advisor and are processing cases of customers who complete the questionnaire.
Which of the following is an advantage of having a moderate level of organizational conflict? It encourages distorted perceptions and stereotypes. It helps reduce organizational politics. It energizes people to evaluate alternatives. It boosts employee motivation. It promotes organizational cohesion.
Answer:
It energizes people to evaluate alternatives.
Explanation:
The organizational conflict refers to disputes at work because of differences of opinions, needs, interests, among others. This conflict should not be eliminated but used in a beneficial way because a moderate level of conflict can be necessary to have different views on a matter which can improve the work and find the best way to handle things. According to this, the answer is that the advantage of having a moderate level of organizational conflict is that it energizes people to evaluate alternatives.
The other options are not right because encouraging distorted perceptions and stereotypes would be considered a disadvantage. Also, moderate conflicts won't reduce efforts some people make to influence others to follow their ideas and it won't increase employee motivation as it can sometimes affect it when there is a dispute. Additionally, moderate conflict won't promote organizational cohesion because it can make it hard at certain moments for employees to work together and as a single unit.
A price ceiling A. is an illegal price. B. is the maximum price that can legally be charged. C. is the price that exists in a black market. D. Both answers A and B are correct. E. Both answers B and C are correct.
Answer:
The correct answer is the option B: is the maximun price that can legally be charged.
Explanation:
To begin with, the concept known as "price ceiling" in the economics field refers to the practice that the government uses in order to establish a maximun price that is the one that can be legally charged to the consumers regarding certain products. This policy comprehends an instrument for the government that it uses it with the purpose to guarantee particular products or services that might be essential to the society so therefore the people can buy it.
In her research paper, Kirstein copied a few paragraphs from a renowned author's work verbatim without placing them within quotation marks or citing the source. The review board rejected her paper on grounds of plagiarism. In this scenario, Kirstein has committed:_________.
Answer:
Word-for-word.
Explanation:
Word for word plagiarism is seen to be an unethical form of writing where the said student or researcher is seen to copy a fellow researchers works verbatim and particularly word for word with also quotation marks too. In as much as this is a bad form for writers, people are always seen to commit themselves in still doing it. This can cause a lawsuit in some places depending on the researcher whose work is been stolen/copied.
In all, it is been tagged an act of intellectual dishonesty which comes with uneasy consequences when it is done to a wrong person; a plagiarized assignment may lead to a failing grade, a suspension, or an expulsion.
Which is an accurate comparison of corporate income taxes and individual income taxes? Corporate income taxes are just about equal to individual income taxes. Corporate income taxes are less than a quarter of individual income taxes. Corporate income taxes are over twice as much as individual income taxes. Corporate income taxes are approximately 50 percent of individual income taxes.
Answer:
Corporate income taxes are approximately 50 percent of individual income taxes.
Explanation:
In the United States, corporate income tax rates have a flat rate of 21%, meaning that all corporations, regardless of profits, pay the same rate.
Individual income taxes, on the other hand, are progressive, meaning that the rates are different depending on income: the higher the income, the higher the individual income tax rate. However, the highest marginal rate is 37%, which is approxiametly twice as much as the flat corporate rate of 21%.
A school district needs to arrange transportation for at least 360 students for a field trip. The district can use large buses or small buses. The large buses hold 60 students each and have an operating expense of $300 for the day. The small buses hold 45 students each and have an operating expense of $200 for the day. The district only has chaperones for, at most, seven buses. What is the minimum cost for the transportation for the field trip if each bus has chaperones
Answer:
$1700
Explanation:
The total number of students are 360 and the best option in selecting large bus or small bus is the one with lowest cost per student.
Large bus cost per student = $300 / 60 students = $5 per student
Small bus cost per student = $200 / 45 students = $4.44 per student
This means that the small bus is the best option.
So by using hit and trail basis,
(45 students * 4 mini buses) + (60 students * 3 Large Buses) = 360 Students
As we have the limit for 7 buses, the above scenario is the best option here and the total cost for 4 mini bus and 3 large buses is as under:
Total Cost = $200 * 4 Mini Buses + $300 * 3 Large Buses
Total Cost = $800 + $900 = $1700
Answer:
1,700
Explanation:
its on edge
An increase in household saving causes consumption to a. fall and aggregate demand to increase. b. rise and aggregate demand to increase. c. rise and aggregate demand to decrease. d. fall and aggregate demand to decrease.
Answer: d. fall and aggregate demand to decrease.
Explanation: When household savings increase, the consumption will fall, as the money which should be spent on consumption such as food, clothing and other products will reduce in other to foster household saving. Also, aggregate demand which is used to measure the total amount of demand for goods and services produced in an economy will also decrease as increase in aggregate demand will inadvertently lead to decrease in household saving.
Therefore, increase in savings requires reduction in spending and demand for products.
Consumption is termed as the process of consuming goods and services by the customers or the households. This is also known as the degree of quantity demanded as it depends on the power of consumption of the individual.
The correct answer is d. fall and aggregate demand to decrease.
When household savings increase, consumption falls because the money available for consumption, such as food, clothes, and other goods, is reduced in order to encourage household savings.
Furthermore, aggregate demand, which is used to assess the overall degree of consumer spending generated in an economy, would fall since a rise in consumer spending will accidentally result in a drop in household savings.
As a consequence, growing savings necessitates lowering expenditure and product demand.
To know more about the consumption of the individuals, refer to the link below:
https://brainly.com/question/14253809
duties of an office clerk
Answer:
what do you need to know
How does the ability to discriminate correctly affect his or her earnings? A. If the negotiated price is higher than the reservation price, a sale is lost, and if the negotiated price is lower than the reservation price, some profit is lost. B. If the negotiated price is higher than the reservation price, some profit is lost, and if the negotiated price is lower than the reservation price, a sale is lost. C. If the reservation price is higher or lower than the reservation price, revenue is gained. D. If the reservation price is higher or lower than the reservation price, a sale is lost. E. If the negotiated price equals the reservation price, profit equals zero.
Answer:
if the negotiated price equals the reservation price profit is zero
Strategists should: Select one: a. Understand the nature of principal-agent and principal-principal conflicts to create better governance mechanisms. b. Develop firm-specific capabilities to differentiate on governance dimensions. c. Understand the rules, anticipate changes, and be aware of differences, especially when doing business abroad. d. All of the above.
Answer:
d. All of the above.
Explanation:
A strategist can be defined as any individual who is knowledgeable, intuitive, brilliant, intelligent in planning the best way to achieve aims, goals and overwhelming success in a particular task or area. They are very good at strategizing the best way to gain advantage in real life situations.
Generally, a strategist should be very good at setting goals, identify the best to achieve these goals and using available resources to execute his plans.
Hence, a strategists should:
a. Understand the nature of principal-agent and principal-principal conflicts to create better governance mechanisms.
b. Develop firm-specific capabilities to differentiate on governance dimensions.
c. Understand the rules, anticipate changes, and be aware of differences, especially when doing business abroad.
Also, a strategist should use his knowledge about corporate governance in answering the four (4) fundamental questions in strategy, which are;
- Why are we (organization) here?
- What do we (organization) stand for?
- Where are we heading (mission and vision)?
- How do we get their (goals)?
Dave and Ellen are newly married and living in their first house. The yearly premium on their homeowner's insurance policy is $450 for the coverage they need. Their insurance company offers a 5 percent discount if they install dead-bolt locks on all exterior doors. The couple can also receive a 2 percent discount if they install smoke detectors on each floor. They have contacted a locksmith, who will provide and install dead-bolt locks on the two exterior doors for $50 each. At the local hardware store, smoke detectors cost $7 each, and the new house has two floors. Dave and Ellen can install them themselves.
a. How many years will it take Dave and Ellen to earn back in discounts the cost of the dead-bolts?
b. How many years will it take Dave and Ellen to earn back in discounts the cost of the smoke detectors?
c.Would you recommend Dave and Ellen invest in the safety items, if they plan to stay in that house for about 5 years?
Answer:
1.Annual discount for dead-bolts $22.50
Recovery period 4.44 years
2.Annual discount for smoke alarms $9.00
Recovery period 1.5 years
3. Yes
Explanation:
1. Calculation for the years it will take Dave and Ellen to earn back the cost of the dead-bolts
a. We were going to calculate for the Annual discount for dead-bolts using this formula Annual discount for dead bolts =Discount percent × Annual premium
Let plug in the formula
Annual discount for dead-bolts =0.05 × $450
Annual discount for dead-bolts =$22.50
b. We are to find Recovery period using this formula Recovery period=Cost of dead bolts / Annual discount for dead-bolts
Let plug in the formula
Recovery period= (2 × $50) / $22.50
Recovery period=100/$22.50
Recovery period= 4.44years
2. Calculation for the years it will take Dave and Ellen to earn back the cost of the smoke detectors
a. We are going to calculate for the Annual discount for smoke alarms using this formula Annual discount for smoke alarms =Discount percent × Annual premium
Let plug in the formula
Annual discount for smoke alarms =0.02 × $450
Annual discount for smoke alarms =$9.00
b. We are going to find the Recovery period using this formula Recovery period=Cost of smoke alarms / Annual discount for smoke alarms
Let plug in the formula
Recovery period=(2 × $7) / $9.00
Recovery period=14/$9.00
Recovery period= 1.5 years
3. Yes I Would recommend both Dave and Ellen to invest in the safety items, if they plan to stay in that house for about 5 years as they should recover most of their costs within the planned tenancy of the house and for their personal safety they should install the items regardless of all the recovery time period.
When a firm is given monopoly power, it loses its freedom of contract, and a governmental body is given the power to determine the provisions of its contracts. The government agency is providing ________.
Answer:
The government agency is providing basic and/or essential services that further deepen the interests of members of the public
Explanation:
The assertion that a firm with a monopoly power loses it freedom of contract is very true. Monopolies by its realities come with features that ultimately cater for the interests of the firm, instead of the consumers. One of these is charging an astronomical high price on a particular item of commodity, and not taking cognizance of the purchasing power of the public. A firm could to this, and ultimately get away because its the only delivering such services - the one with the enormous monopoly power. Here, there is no stiff competition among goods that may offer liberty of choices to ordinary consumers.
To mitigate these numerous power of monopolies, governmental body has been giving the power to regulate and maintain an oversight functions. They now determine the provisions of contracts. The main objective of government agency, thus, is to ensure a firm with a monopoly power considers the basic and essential interests of the members of the public - the end users. Here, members of the public are insulated from unnecesary exploitation by the monopolies.
Give difference between thermoplastics and thermosetting plastic ?
Answer:
Thermoplastic becomes soft and melt when heated.They can be formed into desired shape. WHILE
Thermoset do not melt even at high temperature. once it softens, it can be moulded and can be moulded only once
Which of the following statements support the claim that incentives matter? Explain why or why not. 1. When income transfers to the ablebodied poor increase, the recipients will have less incentive to work. 2. An increase in the fines associated with downloading music and videos protected by copyright laws reduces the number of people engaging in this activity. 3. An increase in the number of people downloading music and videos negatively impacts the commercial production of music and videos.
Answer:
1. When income transfers to the ablebodied poor increase, the recipients will have less incentive to work.
The incentive to work for most people is earning a wage to make a living.
For the poor, this incentive is even more so, because usually, the lack of work for them means severe lacking in their material needs: shelter, food, clothing, electricity, drinking water, and so on.
If the poor are given income transfers from the government, they will have less incentive to work simply because they now obtain some income without the need of doing so.
The incentive to work is reduced even more if the income transfers to the ablebodied poor increase so much that they become higher than the minimum wage. In a situation like this, many ablebodied poor will simply stop searching jobs because they can earn more money from the government by not working.
Who may pay for the services of alcoholic beverage in a private club
Answer:
Members Only
Explanation:
An insurance company is likely to attract customers like Clancy who want to purchase insurance because he knows better that the company that he is more likely to make a claim on a policy. What is the term used to describe the situation above
Answer: adverse selection
Explanation:
From the question, we are told that an
insurance company is likely to attract customers like Clancy who want to purchase insurance because he knows better that the company that he is more likely to make a claim on a policy.
The idea above is called adverse selection. This is a situation whereby either the seller or the buyer believes that he or she has more information than the other person regarding a particular product.
A 10-year corporate bond has a 6 percent coupon, a call premium of $60, and a first call date in year 4. Market interest rates are 6.5 percent and are expected to rise for an extended period. If you plan to hold the bond, which yield should you most consider before buying the bond
Answer:
YTC = 8.3%
Explanation:
you should calculate the yield to call (YTC)
YTC = {coupon + [(call value - market value)/n]} / [(call value + market value)/2]
but we first need to calculate the market value:
PV of face value = $1,000 / (1 + 6.5%)¹⁰ = $532.73
PV of coupons = $60 x 7.18883 (PV annuity factor, 6.5%, 10 periods) = $431.33
market price = $532.73 + $431.33 = $964.06
YTC = {60 + [(1,060 - 964.06)/4]} / [(1,060 + 964.06)/2] = 83.985 / 1,012.03 = 8.3%
Brodrick Company expects to produce 20,000 units for the year ending December 31. A flexible budget for 20,000 units of production reflects sales of $400,000; variable costs of $80,000; and fixed costs of $150,000. If the company instead produces and sells 26,000 units for the year, calculate the expected level of income from operations.
Answer:
For 20,000 units, we have 170,000
For 26,000 units, we have 266,000
Explanation:
Here, we are to calculate the expected level of income from operations.
Formulas that can come in handy from the table are;
Variable amount per unit = sales/number of units
contribution margin = Sales - Variable cost
Income from operations = Contribution margin - fixed cost
Please, kindly checked attached image for tabulated result calculations.
mark, a civil engineer, entered into a contract with david. as per the contract, mark agreed to design and build a house for david for a specified fee. mark provided david with an estimation of the total cost and the contract was mutually agreed upon. however, during construction, when mark increased the price due to a miscalculation on his part, david refused to pay the amount. this scenario is an example of a _____ mistake.
Answer:
Unilateral Mistake
Explanation:
In a contract between two parties, a unilateral mistake occurs when one party in the contract makes a mistake regarding cost, the definition of a term or word, or measurement. The outcome of such a mistake is usually a conflict between the two parties. To resolve this problem, the contract could be canceled (if the other party becomes aware of the mistake), or reformed (if only one party is aware of the mistake).
When Mark made a mistake about the cost of building the house for David, he made a unilateral mistake as the mistake was committed by him alone. David's refusal of the amended cost is resulting in a conflict that would likely lead to the cancellation of the contract.
Claremont Company specializes in selling refurbished copiers. During the month, the company sold 180 copiers at an average price of $3,000 each. The budget for the month was to sell 175 copiers at an average price of $3,200. The expected total sales for 180 copiers were.
Answer:
$576,000
Explanation:
Since the company sold 180 copiers, each at $3,000
175 budgeted for the month was sold at $3,200
Therefore, we sum the above
$3,000 + $3,200
=$6,200
Also, multiply the above outcome with the actual copiers sold
$6,200× 180
=$1,116,000
Therefore; to get the expected total sales for 180 copiers;
$3,000 × 180
=$540,000
Then
=$1,116,000- $540,000
=$576,000
A study examined the economic rewards of obtaining an MBA degree. The researchers made inferences based on wage data collected for a sample of individuals who sat for a particular examination required for most MBA programs. The researchers used data from an earlier article which used random sampling of those who took the exam during a selected time period to draw conclusions about the potential economic benefits of obtaining a an MBA degree. Complete parts Bold a through Bold c below. nothing nothing nothing nothing a. For this study, describe the population of interest. A. All people who have an MBA. B. All those who took the exam during the selected time period.
Answer:
Option B. All those who took the exam during the selected time period.
Explanation:
The reason is that the population of interest is based on the people who took the exam during the selected period because it helps in estimating the actual economic benefits to the people who opted the MBA prgram. So basically we are using the earliar research papers which will help in understanding what value the MBA degree has generated. So the option B is correct.
The Fed has decided to expand the money supply, leading to lower interest rates. As a partner in a tech start-up, you react to these lower interest rates by deciding to expand your operations and begin marketing your new artificial intelligence prototype. What impacts would this decision have on the macroeconomy
Answer:
reducing unemployment and raising GDP and increasing the investment part of GDP
Explanation:
This is the expansion monetary policy. Hiring more people results in business expansion, which reduces unemployment. In addition, more goods and services will be available that will increase GDP as a result of trade expansion. Finally, as business investment increases, so does the share of investment in GDP.correct answer is reducing unemployment and raising GDP and increasing the investment part of GDPIf the dollar buys fewer bananas in Honduras than in Guatemala, then traders could make a profit by
a. buying bananas in Honduras and selling them in Guatemala, which would tend to raise the price of bananas in Honduras.
b. buying bananas in Honduras and selling them in Guatemala, which would tend to raise the price of bananas in Guatemala.
c. buying bananas in Guatemala and selling them in Honduras, which would tend to raise the price of bananas in Guatemala.
d. buying bananas in Guatemala and selling them in Honduras, which would tend to raise the price of bananas in Honduras.
Answer:
The correct answer is C)
Explanation:
Given that the price for bananas is cheaper in Guatemala, suppliers will be driven to make a quick profit just by buying from the Guatemalan market to sell in the Honduras economy.
This, however, will cause the prices of bananas to rise in Guatemala. Because, according to the basic principles of economics, the higher the demand the higher the price.
Cheers!
Generally speaking, personal selling often works better than other forms of promotion if Select one: a. the complexity of the product increases. b. the value of the product decreases. c. the number of potential customers increases. d. the role of social media increases.
Answer:
a. the complexity of the product increases.
Explanation:
Generally speaking, personal selling often works better than other forms of promotion if the complexity of the product increases.
Personal selling can be defined as a promotional process in which a sales person engages a customer and tries to convince him or her to buy a product. The process involves a face-to-face interaction or communication and as such it is also referred to as the face-to-face selling.
Basically, it is a purchase situation involving a face-to-face interaction between the sales person and the customers, in an attempt to sell a product to them.
Also, note that if the complexity of the product increases, the most effective, efficient and best form of promotion would be personal selling because the sales person will have to explain and demonstrate to the potential customers how to use the product.
Hence, products that are technically complex or have complex features such as mobile phones, office equipments, factory equipment, cars are usually sold using the personal selling method. Any organization or business entity using the personal selling method must ensure their sales personnel have good interpersonal skills, ability, outspoken and very friendly with people.
Assume that you work for a company that produces different types of flavored salty snacks for many different target markets (for example, flavored potato chips or flavored sunflower seeds). One part of your job is to explore regularly what flavors your potential customers might like. Taste preferences constantly change, and you may not always be aware of all the flavors people crave. With the above research objective in mind, which type of research would you most likely conduct on a regular basis
Answer:
Focus group
Explanation:
The focus group refers to the people who are involved in a group to discuss about the topic that is related to the research of the market or the analysis of something or discussing for the new product.
It is an open discussion so that everyone who is in a group put their ideas and analyzed it what reactions would be received from an entire population
Since in the question, the taste and preferences changes constantly and the problem is that you are not aware of the flavours what actually people want so it should be discussed in a group so that proper analysis could be made by considering everyone perceptions
Therefore this research represent the focus group
A firm is issuing new debt to finance some capital investment project. The firm will issue 20,000 new $1,000 face-value bonds that will mature in 20 years. The bonds have a coupon rate of 8% and are currently priced at par. The flotation costs that are associated with this new bond issue are expected to be $10 per bond. Further, the company has a marginal tax rate of 34%. Given this information, the before-tax cost of debt is _______________.
Answer:
8.09%
Explanation:
the coupon paid by each bond = $1,000 x 8% = $80
the net amount of money received from each bond = $990
n = 20
now we must find the yield to maturity:
YTM = {coupon + [(face value - market value)/n]} / [(face value + market value)/2]
YTM = {$80 + [($1,000 - $990)/20]} / [($1,000 + $990)/2] = $80.50 / $995 = 0.0809 = 8.09%
On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimate bad debt included the following: Accounts Receivable, debit balance of $98,800; Allowance for Doubtful Accounts, credit balance of $1,121. What amount should be debited to Bad Debts Expense, assuming 5% of outstanding accounts receivable at the end of the current year are estimated to be uncollectible
Answer:
Amount of Bad debts expenses is $3,819
Explanation:
Estimated balance of allowance for doubtful debts account = Accounts receivables * 5%
= $98,800 * 5%
= $98,800 * 0.05
= $4,940
Calculation
Estimated balance of allowance for doubtful debts account = $4,940
Less: Un adjusted credit balance in allowance account = ($1,121)
Bad debts expenses= $3,819
The un-adjusted credit balance is deducted from the estimated balance of allowance accounts. The un-adjusted debit balance is added to the estimated balance of allowance accounts.