Answer:
RTN Industries and Austin Cattle Company
Journal Entries
1. 30% with significant influence:
Jan. 4, 2011: Debit Investment in Austin Cattle Company $648,000
Credit Cash $648,000
To record the cost of the investment by purchasing 20,000 shares or 30% stake in Austin Cattle Company.
December 6, 2011:
Debit Cash $60,000
Credit Investment in Austin $60,000
To record the receipt of dividend.
December 31, 2011:
Debit Investment in Austin Cattle Company $96,000
Credit Investment Income $96,000
To record RTN share of Austin's net income.
2. 10% share:
Jan. 4, 2011: Debit Investment in Austin Cattle Company $648,000
Credit Cash $648,000
To record investment in 10% share of Austin Cattle Company.
Dec. 6, 2011: Debit Cash $60,000
Credit Dividend Income $60,000
To record the receipt of dividend income.
Explanation:
a) Data and Calculations:
Cost of investment in Austin Cattle Company = $648,000
Number of shares held in Austin = 20,000
Percentage of shareholding = 30%
Total number of shares in Austin Cattle = 66,667(20,000/30%)
Austin's reported net income for 2011 = $320,000
RTN share of the net income = $96,000 ($320,000 * 30%)
Analysis:
Investment in Austin Cattle Company $648,000 Cash $648,000
Investment in Austin Cattle Company $96,000 Investment Income $96,000
Cash $60,000 Investment in Austin $60,000
2. If the 20,000 shares represent a 10% interest in the net assets of Austin rather than a 30% interest, the cost method is used:
Analysis:
Investment in Austin Cattle Company $648,000 Cash $648,000
Cash $60,000 Dividend Income $60,000
You are given the following data on the Employed, Unemployed, and the Labor Force for 1997: Population 16 years old or over (millions) 203.1 Employed (millions) 129.6 Unemployed (millions) 6.7 The total labor force in millions in the economy for 1997 equals:__________
Answer:
136.30 million
Explanation:
Total Labor force = Total of the Unemployed + Total of the Employed
Total Labor force = 129.6 million + 6.7 million
Total Labor force = 136.30 million
So, the total labor force in millions in the economy for 1997 equals 136.30 million
the role of manager to organization is to?
Answer:
A manager has to perform functions like planning, organizing, staffing, directing and controlling. All these functions are essential for running an organization smoothly and achieving enterprise objectives. Planning is required for setting goals and establishing strategies for coordinating activities.
The Anthony Company normally takes 30 days to pay for its average daily credit purchases of $2,000. It has average daily sales of $3,000, and collects accounts in 25 days. What is its net credit position
Answer:
The answer is "15000".
Explanation:
Receivable account [tex]=3000\times 25 =75000\\\\[/tex]
Payable account [tex]= 2000\times 30=60000\\\\[/tex]
Calculating the net credit position =Receivable account - Payable account
[tex]=75000-60000\\\\=15000[/tex]
4) The returns on the Bledsoe small-cap fund are the most volatile of all the mutual funds offered in the 401k plan. Why would you ever want to invest in the fund
Answer:
The summary of the given question is summarized in the explanation below.
Explanation:
Users might also opt for investment in a somewhat more "unstable" investment, and that we might risk lower because everything depends instead on the sensitivity of something like the participant's risks.A cautious investor can't invest throughout the micro-cap financing, whereas a risky investor is otherwise able to bear the risk as well as therefore an investment upon that condition increased risk would be equivalent to greater rewards.Josh is a full-time college student who is not working or looking for a job. The Bureau of Labor Statistics counts Josh as a. employed. b. unemployed. c. not in the labor force. d. marginally attached worker .
Answer:
b. unemployed
Master Corp. issued 8%, $80,000 bonds on February 1, 2020. The bonds pay interest semiannually each July 31 and January 31 and were issued to yield 7%. The bonds mature January 31, 2030, and the company uses the effective interest method to amortize bond discounts or premiums.
Required:
a. Prepare journal entries on the following dates.
1. February 1, 2020—Issuance of bonds.
2. July 31, 2020—Interest payment.
3. December 31, 2020—Interest accrual.
4. January 31, 2021—Interest payment. b. Indicate how the balance sheet and income statement of Master
b. Corp. for the year ended December 31, 2020, would reflect these transactions.
c. What is the total cost of financing assuming that the bonds remain outstanding for the full term?
d. What is the total cost of financing assuming that the bonds remain outstanding for the full term if the straight-line interest method was used to amortize the premium?
e. If the company were to have instead amortized the premium using the straight-line interest method, would interest expense recognized be lower or higher in 2020?
f. If the company were to have instead amortized the premium using the straight-line interest method, would interest expense recognized be lower or higher in 2030?
Answer:
Master Corp.
a. Journal Entries:
1. Feb. 1, 2020:
Debit Cash $85,685
Credit 8% Bonds Payable $80,000
Credit Bonds Premium $5,685
To record the issuance of bonds at premium.
2. July 31, 2020:
Debit Interest Expense $2,999
Debit Bonds Premium $201
Credit Cash $3,200
To record the first payment of interest on the bonds and amortization of premium.
December 31, 2020:
Debit Interest Expense $2,493
Debit Bonds Premium $174
Credit Interest Payable $2,667
To accrue interest expense and bonds payable.
4. January 31, 2021:
Debit Interest Expense $499
Debit Bonds Premium $34
Debit Interest Payable $2,667
Credit Cash $3,200
To record the payment of interest.
b. Balance Sheet as of December 31, 2020:
Liabilities:
Bonds Payable $80,000
Bonds Premium $5,310 ($5,685 - 201 - 174)
Income Statement for the year ended December 31, 2020:
Interest Expense $5,492
c. The total cost of financing the bonds for full term is $58,315.04.
d. The total cost of financing is $58,315.04
e. Interest expense would have remained the same.
f. The interest expense would have remained the same as it is not dependent on the premium amortization method used.
Explanation:
a) Data and Calculations:
February 1, 2020:
Face value of issued bonds = $80,000
Price of issued bonds = $85,685
Premium on bonds = $5,685
N (# of periods) 20
I/Y (Interest per year) 8
PMT (Periodic Payment) = $ 3,200
Results:
PV = $85,684.96
Sum of all periodic payments = $64,000.00
Total Interest $58,315.04
July 31, 2020:
Cash payment = $3,200 ($80,000 * 4%)
Interest Expense 2,999 ($85,685 * 3.5%)
Premium amortized $201
December 31, 2020:
Interest Payable = $2,667 ($80,000 * 4% * 5/6)
Interest expense = $2,493
Premium amortized $174
January 31, 2021:
Interest Expense $499
Bonds Premium $34
Interest Payable $2,667
Several market participants interact in developed markets to organize the exchange of funds from buyers to sellers. Such institutions as investment banks, commercial banks, financial services corporations, credit unions, pension funds, life insurance companies, mutual funds, exchange traded funds, hedge funds, and private equity companies play a key role in facilitating these transfers.
Required: Identify the financial institution based on each description given below:
a. These financial conglomerates provide a range of services, such as investment banking, commercial banking, and financial advising.
b. These are financial intermediaries that share the financial risk of the untimely demise of their policyholders, who make regular payments to financial intermediaries for taking this risk.
c. With the use of advanced investment techniques, these largely unregulated portfolios are invested in securities. The investment objective is to offset potential losses by investing in counterbalancing securities. They are open to only a select class of investors.
Answer:
a. financial services corporations
b. life insurance companies
c. hedge funds
Explanation:
a. financial services corporations
The financial services corporations provide different services, to people such as investment banking, commercial banking, and financial advising.
b. life insurance companies
They're financial intermediaries that share the financial risk of the untimely demise of their policyholders, who make regular payments to financial
c. hedge funds
Hedge fund is an investment that protects the portfolios from the uncertainties in the market while maximizing returns. The investment objective is to offset potential losses by investing in counterbalancing securities.
LMNO Partnership has operated for several years. Currently, the partnership has the following account balances: Assets Liabilities Cash $ 100,000 Notes Payable $50,000 Land 200,000 Equity Larry, Capital $60,000 Marge, Capital 70,000 Nancy, Capital 80,000 Owen, Capital 40,000 Larry, Marge, Nancy, and Owen share equally in profits and losses. LMNO Partnership has decided to dissolve their operation. If LMNO is able to sell the land for $250,000 and uses the proceeds to pay off the Notes Payable, how much will Larry receive in return for his partnership interest
Answer:
LMNO Partnership
Larry will receive $72,500 in return for his partnership interest.
Explanation:
a) Data and Calculations:
Assets Liabilities
Cash $ 100,000
Land 200,000
Total assets = $300,000
Notes Payable $50,000
Equity:
Larry, Capital $60,000
Marge, Capital 70,000
Nancy, Capital 80,000
Owen, Capital 40,000
Total equity = $250,000
Total equity and liabilities = $300,000
Profit and loss sharing = equally (25% each)
Cash balance after the sale of land and settlement of debt:
Cash balance $100,000
Sale of land $250,000
Settlement of notes payable (50,000)
Balance to be distributed to partners $300,000
Statement of capital liquidation:
Larry Marge Nancy Owen Total
Capital accounts $60,000 $70,000 $80,000 $40,000 $250,000
Profit from land sale 12,500 12,500 12,500 12,500 50,000
Capital balances $72,500 $82,500 $92,500 $52,500 $300,000
Cash distribution ($72,500) ($82,500) ($92,500) ($52,500) ($300,000)
Capital balances $0 $0 $0 $0 $0
1. Prepare general journal entries to record the transactions above for Spade Company by using the following accounts: Cash; Accounts Receivable; Office Supplies; Office Equipment; Accounts Payable; Common Stock; Dividends; Fees Earned; and Rent Expense. 2. Post the above journal entries to T-accounts, which serve as the general ledger for this assignmen
Question Completion:
The transactions of Spade Company appear below. a. Kacy Spade, owner, invested $18,750 cash in the company in exchange for common stock. b. The company purchased office supplies for $544 cash. c. The company purchased $10,369 of office equipment on credit. d. The company received $2,212 cash as fees for services provided to a customer. e. The company paid $10,369 cash to settle the payable for the office equipment purchased in transaction c. f. The company billed a customer $3,975 as fees for services provided. g. The company paid $530 cash for the monthly rent. h. The company collected $1,670 cash as partial payment for the account receivable created in transaction f. i. The company paid $1,000 cash in dividends to the owner (sole shareholder).
Answer:
Spade Company
General Journal Entries:
a. Debit Cash $18,750
Credit Common stock $18,750
To record cash contributed in exchange of common stock.
b. Debit Office supplies $544
Credit Cash $544
To record the purchase of office supplies.
c. Debit Office Equipment $10,369
Credit Accounts Payable $10,369
To record the purchase of office equipment on account.
d. Debit Cash $2,212
Credit Fees Earned $2,212
To record the receipt of cash for earned fees.
e. Debit Accounts Payable $10,369
Credit Cash $10,369
To record the payment for office equipment.
f. Debit Accounts Receivable $3,975
Credit Fees Earned $3,975
To record the supply of services on account.
g. Debit Rent Expense $530
Credit Cash $530
To record payment for monthly rent.
h. Debit Cash $1,670
Credit Account receivable $1,670
To record the receipt of cash on account.
i. Debit Dividends $1,000
Credit Cash $1,000
To record the payment of cash dividend.
2. T-accounts:
Cash
Account Title Debit Credit
Common stock $18,750
Office supplies $544
Fees Earned 2,212
Accounts Payable 10,369
Rent Expense 530
Account receivable 1,670
Dividends 1,000
Accounts receivable
Account Title Debit Credit
Fees Earned $3,975
Cash $1,670
Office Supplies
Account Title Debit Credit
Cash $544
Office Equipment
Account Title Debit Credit
Accounts Payable $10,369
Common Stock
Account Title Debit Credit
Cash $18,750
Accounts Payable
Account Title Debit Credit
Office Equipment $10,369
Cash $10,369
Fees Earned
Account Title Debit Credit
Cash $2,212
Accounts Receivable 3,975
Rent Expense
Account Title Debit Credit
Cash $530
Dividends
Account Title Debit Credit
Cash $1,000
Explanation:
a) Data and Analysis:
a. Cash $18,750 Common stock $18,750
b. Office supplies $544 Cash $544
c. Office Equipment $10,369 Accounts Payable $10,369
d. Cash $2,212 Fees Earned $2,212
e. Accounts Payable $10,369 Cash $10,369
f. Accounts Receivable $3,975 Fees Earned $3,975
g. Rent Expense $530 Cash $530
h. Cash $1,670 Account receivable $1,670
i. Dividends $1,000 Cash $1,000
arett Motors is trying to decide whether it should keep its existing car washing machine or purchase a new one that has technological advantages (which translate into cost savings) over the existing machine. Information on each machine follows: Old machine New machine Original cost $9,000 $20,000 Accumulated depreciation 5,000 0 Annual cash operating costs 9,000 4,000 Current salvage value of old machine 2,000 Salvage value in 10 years 500 1,000 Remaining life 10 yrs 10 yrs Refer to Jarett Motors. The $4,000 of annual operating costs that are common to both the old and the new machine are an example of a(n) Select one: a. opportunity cost b. irrelevant cost c. future avoidable cost d. sunk cost
Answer:
Jarett Motors
The $4,000 of annual operating costs are an example of an
a. opportunity cost
Explanation:
a) Data and Calculations:
Old machine New machine
Original cost $9,000 $20,000
Accumulated depreciation 5,000 0
Annual cash operating costs 9,000 4,000
Current salvage value of old machine 2,000
Salvage value in 10 years 500 1,000
Remaining life 10 yrs 10 yrs
b) The annual operating costs are an example of opportunity cost because the alternative with the old machine will incur an annual operating cost of $9,000 instead of $4,000 with the new machine. This will translate to a forgone benefit of $5,000 ($9,000 - $4,000) in cost saving if the new machine is purchased.
Under normal conditions (60% probability), Financing Plan A will produce a $30,000 higher return than Plan B. Under tight money conditions (40% probability), Plan A will produce $40,000 less than Plan B. What is the expected value of return
Answer:
the expected value of return is $2,000
Explanation:
The computation of the expected value of return is shown below:
= Given percentage of amount + (given percentage of amount)
= 60% of $30,000 + (40% of -$40,000)
= $18,000 - $16,000
= $2,000
hence, the expected value of return is $2,000
The same should be considered and relevant
Allowance for Doubtful Accounts has a debit balance of $533 at the end of the year (before adjustment), and Bad Debt Expense is estimated at 4% of sales. If net credit sales are $947,400, the amount of the adjusting entry to record the estimate of the uncollectible accounts is
Answer:
See below
Explanation:
Given the above information, the amount of the adjusting entry to record the estimated uncollectible account receivable is computed as seen below;
= Bad debt expense × Net credit sales
= 4% × $947,400
= $37,896
Then,
=Balance - Allowance for doubtful account (debit balance)
= $37,896 - $533
= $37,363
Then, the amount of the adjusting entry to record the estimated uncollectible account receivable is $37,363
A college uses advisors who work with all students in all divisions of the college. The most useful allocation basis for the salaries of these employees would likely be: ___________.
a. number of students advised from each division.
b. relative salaries of division heads.
c. square footage of each division.
d. number of classes offered in each division.
e. student graduation rate.
Answer: a. number of students advised from each division
Explanation:
An allocation base simply refers to the the basis upon which the overhead cost of an entity is allocated. This can.be done by the machine hours used, square footage occupied etc.
Since the college uses advisors who work with all students in all divisions of the college, the most useful allocation basis for the salaries of these employees would likely be the number of students that are advised from each division.
Therefore, the correct option is A.
Tony's marginal income tax rate is 24%, and he pays FICA tax on his entire salary (7.65%). Tony's employer offered him a choice between $5,000 additional salary or a nontaxable fringe benefit. Tony would have to pay $3,600 to purchase the benefit directly. Which of the following statements is true? (answers rounded to the nearest whole dollar)A. The fringe benefit and the additional salary have the same after-tax value.B. The fringe benefit is worth $83 more than the additional salary.C. The additional salary is worth $300 more than the fringe benefit.D. None of the above is true.
Answer: The fringe benefit is worth $182 more than the additional salary.
Explanation:
The Fringe benefit is valued at $3,600.
The additional salary after taxes is:
= 5,000 - (5,000 * 24%) - (5,000 * 7.65%)
= 5,000 - 1,200 - 382.5
= $3,418
The Fringe benefit is worth more than the salary by:
= 3,600 - 3,418
= $182
Options are more probably for a variant of this question.
Sommers Co.'s bonds currently sell for $1,080 and have a par value of $1,000. They pay a $100 annual coupon and have a 15-year maturity, but they can be called in 5 years at $1,125. What is their yield to maturity (YTM)
Answer:
9.01%
Explanation:
Calculation to determine their yield to maturity (YTM)
We would be using financial calculation to determine their yield to maturity (YTM)
N =15 years
PV=$1,080
PMT=$100
FV=$1,000
Hence,
I/YR=YTM=9.01%
Therefore their yield to maturity (YTM) is 9.01%
Sheffield Co. had retained earnings of $19900 on the balance sheet but disclosed in the footnotes that $2800 of retained earnings was restricted for building expansion and $800 was restricted for bond repayments. Cash of $2200 had been set aside for the plant expansion. How much of retained earnings is available for dividends?a. $12,000.b. $13,000.c. $15,000.d. $10,000.
Answer:
$16,300
Explanation:
Calculation to determine How much of retained earnings is available for dividends
Using this formula
Retained earnings=Retained earnings - Retained earnings for restricted plant expansion - Restricted for bond repayments
Let plug in the formula
Retained earnings= $19,900 - $2,800 - $800
Retained earnings= $16,300
Therefore the amount of retained earnings that is available for dividends is $16,300
Henry has a defined benefit plan that promises an annual retirement benefit based on 2% of his final 5-year average annual salary for each year of service. At retirement, Henry has 21 years of service and had an average salary of $95,000 over the last 5 years. His annual benefit will be:_______a. $15,200. b. $95,000. c. $60,500. d. $49,875. e. $39,900.
Answer: e. $39,900
Explanation:
Henry's defined benefit can be calculated by the formula:
= Average salary over the last 5 years * Years of service at retirement * annual retirement benefit percentage based on 5 year average salary
= 95,000 * 21 * 2%
= $39,900
Cherry Corporation, a calendar year C corporation, is formed and begins business on April 1 of the current year. In connection with its formation, Cherry incurs organizational expenditures of $54,000.
Required:
Determine Cherry Corporationâs deduction for organizational expenditures for 2015.
[tex]\huge\bold{Question}[/tex]
Prove that [tex]\sqrt{n} [/tex] is not a rational number, if n is not perfect square.
[tex]\huge{\underline{\underline{\mathrm{\red{AnswEr}}}}}[/tex] [tex]\huge\bold\blue{=}[/tex]
[tex]\sqrt{4} [/tex]= 2 where 2 is a rational number . Here n is perfect square the [tex]\sqrt{n} [/tex] is rational number
[tex]\sqrt{5} [/tex] = 2.236.. is not rational number But it is irrational number.here n is not a perfect square the [tex]\sqrt{n} [/tex] is irrational number
So [tex]\sqrt{n} [/tex] is not irrational number if n is perfect square.
Taxes on labor have the effect of encouraging Group of answer choices workers to work more hours. the elderly to postpone retirement. second earners within a family to take a job. unscrupulous people to take part in the underground economy.
Answer:
unscrupulous people to take part in the underground economy.
Explanation:
Taxes are levies that a government collects from individuals and businesses. It is compulsory and is used to raise revenue from services, goods, or income.
When income earned by labour is taxed it reduces the the moral of employees to work and earn legally.
Some may now turn to the underground economy to earn more money.
The underground economy is made up of illegal activities that fail to meet reporting standards of the government. That is either transactions are made on goods that are illegal or income earned is not subject to government taxation.
Which of the following is an example of investment? A. a person depositing $ 100 a week to her savings account B. a person's annual medical checkup C. the purchase of new buses by Greyhound D. a student increasing his human capital by attending college
Answer:
C. the purchase of new buses by Greyhound
Explanation:
The investment is the amount that should be invested in order to generate the income
So as per the given situation,the option C is correct as if we puchase the new buses so there is a big investment but after investing into it it generated the income on daily basis
So this should be the example of the investment
The Wildhorse Company has disclosed the following financial information in its annual reports for the period ending March 31, 2017: sales of $1.484 million, cost of goods sold of $803,000, depreciation expenses of $175,000, and interest expenses of $89,575. Assume that the firm has an average tax rate of 35 percent. Compute the cash flows to investors from operating activity.
Answer: $535,251.25
Explanation:
Cash flow to investors from operating activities is calculated by:
= EBIT + Depreciation - Taxes
EBIT = Sales - Cost of goods sold - Depreciation
= 1,484,000 - 803,000 - 175,000
= $506,000
Taxes = Tax rate * (EBIT - Interest)
= 35% * (506,000 - 89,575)
= $145,748.75
Cash flow to investors = 506,000 + 175,000 - 145,748.75
= $535,251.25
Using these data from the comparative balance sheet of Blossom Company, perform vertical analysis. (Round percentages to 1 decimal place, e.g. 12.5%.) Dec. 31, 2017 Dec. 31, 2016 Amount Percentage Amount Percentage Accounts receivable $ 497,000 Enter percentages % $ 435,000 Enter percentages % Inventory $ 735,000 Enter percentages % $ 555,000 Enter percentages % Total assets $3,101,000 Enter percentages % $2,758,000 Enter percentages %
Answer:
For 2017
Account receivable % = Account Receivable/Total Assets x 100
Account receivable % = $ 497,000/$ 3,101,000 * 100
Account receivable % = 0.16027088 * 100
Account receivable % = 16.0%
Inventory % = Inventory/Total Assets *100
Inventory % = $ 735,000/$ 3,101,000 * 100
Inventory % = 0.2370203 * 100
Inventory % = 23.7 %
Total Assets = $3,101,000 = 100%
For 2016
Account receivable % = Account Receivable/Total Assets * 100
Account receivable % = $ 435,000/$ 2,758,000 * 100
Account receivable % = 0.15772298 * 100
Account receivable % = 15.8%
Inventory % = Inventory/Total Assets * 100
Inventory % = $555,000/$ 2,758,000 * 100
Inventory % = 0.20123277 * 100
Inventory % = 20.1%
Total Assets = $2,758,000 = 100 %
Pat is on the Board of Directors for Zony, a consumer electronics manufacturer. Pat has been an excellent board member by providing leadership and expertise to the Zony Board. Zamzung is a consumer electronics manufacturer and direct competitor to Zony. Zamzung believes Pat would be a good addition to their Board of Directors. Zamzung asks Pat to join the Board of Zamzung. Can Pat be on the Board of Directors of both Zony and Zamzung?
Answer: No. Pat cannot be on the Board of Directors of both Zony and Zamzung.
Explanation:
No, Pat cannot be on the Board of Directors of both Zony and Zamzung. The Clayton Act prohibits this as Pat can have superior power and high control of the industry.
Pat can also face ethical issues such as internal tactics or sharing of information or conflict regarding decision making. Pat being on the Board of Directors of both Zony and Zamzung will lead to an unfair competition in the market as well.
Solve for the unknown interest rate in each of the following (Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.):
Present Value Years Interest Rate Future Value
181 5 $ 317
335 17 1,080
48,000 13 185,382
40,353 30 531,618
Answer:
11.86%
7.13%
19.95%
8.97%
Explanation:
interest rate = [tex]\frac{future value}{present value}}^{\frac{1}{n} } - 1[/tex]
(317/181)^ (1/5) - 1 = 11.86%
1080/335)^(1/17) - 1 = .13%
(185,382/48,000)^(1/13) - 1 = 19.95%
(531,618 / 40,353)^(1/30) - 1 = 8.97%
The interest rate in the 1 case is 5.01%, 2 case is 5.79%, 3 case is 8.05%, 4 case is 10.60%.
What is interest rate?An interest rate is the amount of interest owed per period, as a quotient of the amount lent, deposited, or borrowed.
Computation of the interest rates :The formula for future value is:
[tex]\text{FV}= \text{PV} \ (1+r)^n[/tex]
where,
PV=present value
r=interest rate
n =number of periods/ years
FV = future value.
Then, the formula for finding r is :
[tex]\text{FV}= \text{PV} \ (1+r)^n\\\\r= (\dfrac{\text{FV}}{\text{PV}})^\dfrac{1}{\text{n}-1}[/tex]
case1:put the above formula in case 1 we get:
[tex]r= (\dfrac{\text{\$231}}{\text{\$190}})^\dfrac{1}{4}-1}\\\\r= (\dfrac{\text{\$231}}{\text{\$190}})^{0.25-1}\\\\r=(1.21578947)^{0.25-1}\\\\r=1.05006116 -1\\\\r=0.05006116\times100\\\\r=5.01%[/tex]
case2:Put the above formula in case 2 we get:
[tex]r= (\dfrac{\text{\$854}}{\text{\$310}})^\dfrac{1}{18}-1}\\\\r= (\dfrac{\text{\$854}}{\text{\$310}})^{0.0555-1}\\\\r=(2.75483871)^{0.0555-1}\\\\r=1.05785304 -1-1\\\\r=0.05785304\times100\\\\r=5.79%.[/tex]
case3:Put the above formula in case 3 we get:
[tex]r= (\dfrac{\text{\$1,48,042}}{\text{\$34,000}})^\dfrac{1}{19}-1}\\\\r= (\dfrac{\text{\$1,48,042}}{\text{\$34,000}})^{0.0526-1}\\\\r=(4.35417647)^{0.0526-1}\\\\r=1.08045444 -1\\\\r=0.08045444\times100\\\\r=8.05%[/tex]
case4:Put the above formula in case 4 we get:
[tex]r= (\dfrac{\text{\$412,862}}{\text{\$36,261}})^\dfrac{1}{25}-1}\\\\r= (\dfrac{\text{\$412,862}}{\text{\$36,261}})^{0.04-1}\\\\r=(12.4127958)^{0.04-1}\\\\r=1.10599913 -1\\\\r=0.10599913\times100\\\\r=10.60%.[/tex]
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Dividends at FSL are expected grow at a rate of negative 5.4% per year (the dividends are getting smaller). The stock just paid a dividend of $3.93 per share, and investors require a return of 13% to invest in the company. What is the expected price of the stock next year?
Answer:
$21.37
Explanation:
g = -5.4%
D0 = $3.93
D1 = D0 (1+g)
D1 = 3.93*(1-0.054)
D1 = 3.93*0.946
D1 = 3.71778
Investors require a return (ke) of 12%
P0 = D1/(ke - g)
P0 = 3.71778 / (12% - (-5.4%)
P0 = 3.71778 / (12% + 5.4%)
P0 = 3.71778 / 17.4%
P0 = 3.71778 / 0.174
P0 = 21.3665517
P0 = $21.37
So, the expected price of the stock next year is $21.37.
Hart, an individual, bought an asset for $500,000 and has claimed $100,000 of depreciation deductions against the asset. Hart has a marginal tax rate of 32 percent.
a1. What is the amount and character of Hart's recognized gain or loss if the asset is tangible personal property sold for $550,000?
a2. Due to this sale, what tax effect does Hart have for the year?
Answer and Explanation:
The computation is shown below:
a. The amount and the character of the gain or loss is
Sale value of the property $550,000
Less: (Purchase value - depreciation) $400,000
Total gain recognized $150,000
Ordinary income recapture is $100,000
remaining 1231 gain or loss $50,000
b.
Section 1231 Gain = $50,000
, Rate of tax on $100,000 i.e. 32% = $32000
Rate of tax on $50000 i.e. 15% = $7500
So,
The Total tax liability is
= $32,000 + $7,500
= $39,500
Horizontal analysis evaluates a series of financial statement data over a period of time Group of answer choices that has been arranged from the highest number to the lowest number. that has been arranged from the lowest number to the highest number. to determine which items are in error. to determine the amount and/or percentage increase or decrease that has taken place.
Answer:
C) to determine the amount and/or percentage increase or decrease that has taken place.
Explanation:
Horizontal analysis can be regarded as an approach which is been used in analyzing financial statements through making comparism between specific financial information for a particular accounting period along with the information from other periods. This approach is been used by Analysts to make analysis of historical trends.
It should be noted that Horizontal analysis evaluates a series of financial statement data over a period of time to determine the amount and/or percentage increase or decrease that has taken place.
Lesco's is evaluating a project that has a different level of risk than the overall firm. This project should be evaluated: Group of answer choices
Answer:
3. using a beta commensurate with the project's risks.
Explanation:
In the case when the project is evaluated so there is the different type of the risk instead of the total firm so here the project should be evaluated via beta commensurate alonhg with the risk of the project. As each and very project has the different level of risk also there is a different between the beta as if we compared to the beta of the market, beta of the firm etc
Hence, the above represent the answer
Albatross Company purchased a piece of machinery for $60,000 on January 1, 2019, and has been depreciating the machine using the double-declining-balance method based on a five-year estimated useful life and no salvage value. On January 1, 2021, Albatross decided to switch to the straight-line method of depreciation. The salvage value is still zero and the estimated useful life did not change. Ignore income taxes.
Required:
a. What type of accounting change is this, and how should it be handled?
b. Prepare the journal entry to record depreciation for 2017. Show all calculations clearly.
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Answer:
Currently, the income statement for company reflects a total period cost for depreciation of $7,876,000
The main disadvantage of an emissions tax is that :______.a) the total pollution reduction from an emissions tax cannot be known for sure. b) firms lack the flexibility to pursue different technologies. c) firms do not have an incentive to reduce pollution. d) firms cannot behave in an economically-efficient manner. e) differences among firms are not incorporated into the policy.
Answer:
.a) the total pollution reduction from an emissions tax cannot be known for sure.
Explanation:
The broad form of taxes by government on greenhouse gases , these is
✓an emissions tax: this tax is been put on the company due to the quantity that is been produced by entity. This emmision tax is imposed as a result of green house effect gas that is been produced during operation of companies example of this carbon tax, since the effect of the green house is felt in weather events, this tax is on goods or services which is known to be greenhouse gas-intensive, for instance carbon tax on gasoline. It should be noted that the main disadvantage of an emissions tax is that the total pollution reduction from an emissions tax cannot be known for sure.