Business College

Lucy's Music Emporium opened its doors on January 1, 2015, and it was granted permission to use the same depreciation calculations for shareholder reporting and income tax purposes. The company planned to depreciate its fixed assets over 20 years, but in December 2015 management realized that the assets would last for only 15 years. The firm's accountants plan to report the 2015 financial statements based on this new information. How would the new depreciation assumption affect the company's financial statements? a. The firm's reported 2015 earnings per share would increase. b. The firm's EBIT would increase. c. The firm's net liabilities would increase. d. The firm's reported net fixed assets would increase.

Answers

Answer 1

Answer:

The firm's cash position in 2015 and 2016 would increase.

Explanation:

In the case when the life of an asset would decrease that represents the depreciation would rise and if the depreciation rise so the EBIT and EPS would reduced and in the case when the EBIT reduced, so automatically the tax expense is also reduce

So, the cash position of the firm woud increase

Hence, the above represents the answer

Related Questions

To make valid computations of adjustments for the sales comparison approach to value, elements of comparison must be applied in a specific order. Which one of these elements listed has the highest priority?

Answers

Hello. You forgot to enter the answer options. The response options are:

Location

Market conditions

Conditions of sale

Physical characteristics

Answer:

Physical characteristics

Explanation:

The physical characteristics of the analyzed system, must have priority in determining the approach of comparing sales to value. This is because these characteristics have a strong influence on the composition of the product and the constancy of sales, in addition to determining the entire functioning of the system.

The one of the element that has the highest priority is Physical characteristics

The following information should be considered:

The physical characteristics of the analyzed system, must have priority in determining the approach of comparing sales to value. This is due to the characteristics that contains a strong influence on the composition of the product and the constancy of sales, in addition to measure the overall functioning of the system.

Learn more: brainly.com/question/16911495

A pizza monopolist employing third-degree price discrimination charges students $10 per pizza and everyone else $15 per pizza Students must show the ID before they can get the discount The marginal cost of this monopolist is $5 whether or not the customer is a student. The price elasticity of demand for the students is

Answers

Answer:

The price elasticity of demand for the students is:

inelastic.

Explanation:

The price elasticity of demand for the students is inelastic because there is no change in the quantity demanded by students that changes the price at which pizza is sold to the students.  If one student buys the pizza, the price charged remains $10 and if 1,000 students buy the pizza, the price remains $10 per unit.  Therefore, students' demand for the pizza is said to be static irrespective of price because the price is fixed.

Other Questions
A pizza monopolist employing third-degree price discrimination charges students $10 per pizza and everyone else $15 per pizza Students must show the ID before they can get the discount The marginal cost of this monopolist is $5 whether or not the customer is a student. The price elasticity of demand for the students is The diagram represents a plant leaf cell and two different molecules used in the process of photosynthesis. Molecule 1 and 2 are most likely A. Carbon dioxide and waterB. Nitrogen and waterC. carbon dioxide and nitrogen D. Nitrogen and oxygen Pls help Im so confused :( Many small freshwater organisms have a structure called a contractile vacuole, which pumps water out their body. Explain how this process is an example of active transport. what is dark matter can we travel faster than speed of lightwhat is chlorophyll It took Davina 45 minutes to clean her room. How many seconds did it take her Bananas cost $0.79 a pound. Mrs. Huff bought ppounds of bananas. She paid a total of $7.90.Write an equation to represent the situation. 5. Studying light from a star allows us to a. determine a star's temperature b. determine what elements the star is made of c. determine how a star is moving (toward, away, fast, slow) d. all of these e. none of these The ratio of fifth graders to sixth graders is 4 to 5. If one of the grade totals is 160,select the possible totals for the other grade.2001604032128 Discuss what the types of stnovial joints and joint movements of the knee, wrist, and shoulder joint, and describe how the joint mimic objects in the home The value of a car depreciates every year ata constant rate, Gary bought a car for $25,000 in the year 2013. If the value of the car is expected to depreciate 15% annually, what can Gary expect for the value of his car in the year 2017? The proportional relationship between the number of inches a candle has burned away, b, at any time in hours, t, can be represented by the equation b = 0.25tb=0.25t. What is the constant of proportionality from the time in hours to the inches of candle that has burned away? Young Gavin has a much harder time learning to button his clothes than his siblings had. He never has seemed to get the knack of stringing beads, and his attempts at writing are also quite sloppy. Which might Gavin's pediatrician say to his parents about this WILL GIVE 20 POINTSRead the sentence and choose the option with the correct number which matches the sentence. El silln cuesta novecientos dlares. A. 900 B. 9.000 C. 500 D. 5.000 What is the slope of the line? what is the slope intercept form of a linear function Points (3, 5) and (3, 5) on the coordinate grid below show the positions of two players on a tennis court:A coordinate plane is shown. There is a point at 3, 5 labeled Player 2. There is a point at negative 3, 5 labeled Player 1.Which statement best describes the relationship between the positions of the two players? (4 points)A)Player 2's position is Player 1's position reflected across the y-axis; only the signs of the y-coordinates of Player 1 and Player 2 are different.B)Player 2's position is Player 1's position reflected across the x-axis; only the signs of the x-coordinates of Player 1 and Player 2 are different.C)Player 2's position is Player 1's position reflected across the x-axis; only the signs of the y-coordinates of Player 1 and Player 2 are different.D)Player 2's position is Player 1's position reflected across the y-axis; only the signs of the x-coordinates of Player 1 and Player 2 are different. PLEASE HELP ASAP!!! Find the values of the variables and round to the nearest hundredth if necessary. The Stolen Valor Act dealt with lies that were told about Who pays for the Supreme Court judges' salaries?