Malrom Manufacturing Company acquired a patent on a manufacturing process on January 1, 2014 for $3,750,000. It was expected to have a 10 year life and no residual value. Malrom uses straight-line amortization for patents. On December 31, 2015, the expected future cash flows expected from the patent were expected to be $300,000 per year for the next eight years. The present value of these cash flows, discounted at Malrom’s market interest rate, is $1,800,000. At what amount should the patent be carried on the December 31, 2015 balance sheet? $3,750,000 $3,000 $2,400,000 $1,800,000
Answers
Answer:
$1,800,000
Explanation:
Please see attachment.
Related Questions
Pioneer Systems Inc. has a high degree of formalization. Employees in Pioneer Systems are more likely to:
A. face morale and motivation problems.
B. feel empowered to implement new solutions.
C. exhibit high levels creativity and experimentation.
D. face ambiguity as a result of a lack of formal rules and procedures.
Answers
Answer:
Letter A is correct. Face morale and motivation problems.
Explanation:
A company with a high degree of formalization is a company with a vertical organizational structure. Vertical management is represented by a classic business structure, based on the principle of top-down authority and command and a fixed organization chart.
Being an inflexible organizational model, there are some disadvantages, such as difficulty in interaction between areas and teams, communication failure due to communication noise, which can lead to the creation of moral conflicts and also the lack of motivation of employees, which due to Organizational rigidity is not so active in the process of contributing ideas and suggestions to organizational objectives, as decision making is centralized and concentrated at the top of the hierarchy.
Bramble Company took a physical inventory on December 31 and determined that goods costing $216,300 were on hand. Not included in the physical count were $22,720 of goods purchased from Pelzer Corporation, f.o.b. shipping point, and $19,770 of goods sold to Alvarez Company for $29,450, f.o.b. destination. Both the Pelzer purchase and the Alvarez sale were in transit at year-end. What amount should Bramble report as its December 31 inventory?
Answers
Answer:
$258,790
Explanation:
Bramble report as its December 31 inventory:
= Inventory in hand as per physical count + Goods purchased from P corporation under FOB shipping basis + Cost of goods sold to A company under FOB destination basis
= $216,300 + $22,720 + $19,770
= $258,790
Therefore, the amount to be reported by Bramble company is $258,790.
2. You have just completed an analysis of Rodriguez Manufacturing. You used the Capital Asset Pricing Model to determine that the required rate of return is 13%. The last dividend paid was $1.80, and the current price is $25. Based on new manufacturing processes that the company recently adopted and the company’s history of consistently paying dividends, you believe the company’s dividends will grow at a constant growth rate of 6%.
Answers
Answer:
You didn´t post the question complete. So I found the expected rate of return. Hope be useful.
Explanation:
Required rate of return on stock = 13%
Expected rate of return is calcualted below Using DDM model:
Expected rate of return = [$1.80 × (1 + 6%) / ($25)] + 6%
= ($1.908 / $25) + 6%
= 7.632% + 6%
= 13.632%
Expected rate of return is 13.632%.
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below:
Standard Quantity or Hours Standard Price
or Rate Standard
Cost
Direct materials 6.00 pounds $ 2.30 per pounds $ 13.80
Direct labor 0.50 hours $ 10.00 per hour $ 5.00
During the most recent month, the following activity was recorded:
During the most recent month, the following activity was recorded:
a. 11,000 pounds of material were purchased at a cost of $2.10 per pound.
b. All of the material purchased was used to produce 1,500 units of Zoom.
c. 500 hours of direct labor time were recorded at a total labor cost of $6,500.
Required:
1.
Compute the materials price and quantity variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
2. Compute the labor rate and efficiency variances for the month. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)
Answers
Answer:
1. $2,200 Favorable ; $4,600 Unfavorable
2. $1,500 Unfavorable ; $2,500 Favorable
Explanation:
1. Material price variance:
= Actual quantity × Standard cost per unit-Actual cost
= (11,000 × $2.30) - ($2.10 × 11,000 )
= $2,200 Favorable
Material quantity variance:
= (Standard quantity × Standard cost per unit) - (Actual quantity × Standard cost per unit )
= (1,500 × 6 × $2.30) - (11,000 × $2.30)
= $4,600 Unfavorable
2. Labor rate variance:
= (Actual hours × Standard rate) - Actual labor paid
= (500 × $10) - $6,500
= $1,500 Unfavorable
Labor efficiency variance:
= (Standard hours × Standard rate) - (Actual hours × Standard rate )
= (1,500 × 0.50 × $10) - (500 × $10)
= $2,500 Favorable
Saks is expected to pay a dividend in year 1 of $1.80, a dividend in year 2 of $2.12, and a dividend in year 3 of $2.69. After year 3, dividends are expected to grow at the rate of 8% per year. An appropriate required return for the stock is 11%."
What should the stock price be worth after three years?
Answers
Answer:
$96.84
Explanation:
The computation of the stock price after three years are shown below:
= (Third-year dividend × growth rate) ÷ (Required rate of return - growth rate)
= ($2.69 × 1.08) ÷ (11% - 8%)
= ($2.9052) ÷ (3%)
= $96.84
The growth rate equal to
= 1 + growth rate
= 1 + 8%
= 1.08
We simply apply the growth model so that the after three years stock price can be correctly computed
Final answer:
The stock price after three years is calculated using the Dividend Discount Model for a perpetuity, considering the given dividends and expected growth rate, resulting in a value of $96.12.
Explanation:
The question asks to calculate the worth of a stock after three years, given the dividends for the first three years and an expected perpetual growth rate thereafter. The dividends for year 1 are $1.80, year 2 are $2.12, and year 3 are $2.69. After year 3, dividends are expected to grow at a rate of 8% per year indefinitely. The required return for the stock is 11%. To find the stock price after three years, we will use the Dividend Discount Model (DDM) for a perpetuity which considers the dividend growth. The formula for the value of the stock at the end of year 3, which is before applying the growth rate in year 4, is: P3 = D3 * (1 + g) / (r - g), where P3 is the stock price at the end of year 3, D3 is the dividend in year 3, g is the growth rate (8%), and r is the required return (11%). Substituting the given values: P3 = $2.69 * (1 + 0.08) / (0.11 - 0.08) = $2.69 * 1.08 / 0.03 = $96.12. Therefore, the stock should be worth $96.12 after three years.
otal Labor Variance Tico Inc. produces plastic bottles. Each bottle has a standard labor requirement of 0.01 hours. During the month of April, 510,000 bottles were produced using 13,000 labor hours @ $9.00. The standard wage rate is $7.50 per hour. Required: Calculate the total variance for production labor for the month of April. Enter amounts as positive numbers. If required, round your answer to the nearest cent.
Answers
Answer:
$78,750 unfavorable
Explanation:
Total labor variance can be divided into direct labor efficiency variance and the direct labor rate variance
Direct labor efficiency variance (DLEV):
DLEV = (Expected labor hours - actual labor hours)*standard rate
[tex]DLEV=(0.01*510,000 - 13,000)*7,50\\DLEV = -59,250[/tex]
Direct labor rate variance (DLRV):
DLRV = Actual labor hours * (Standard Rate - Actual Rate)
[tex]DLRV = 13,000*(7.50 - 9.00)\\DLRV = -19,500[/tex]
Since both values are negative, they are both unfavorable and the total labor variance (TLV) is given by:
[tex]DLRV = 13,000*(7.50 - 9.00)\\DLRV = 59,250 + 19,500\\TLV = \$ 78,750 \ unfavorable[/tex]
Use the following information to determine the ending cash balance to be reported on the month ended June 30 cash budget.
Beginning cash balance on June 1, $94,400.
Cash receipts from sales, $415,000.
Budgeted cash payments for purchases, $270,000.
Budgeted cash payments for salaries, $95,400.
Other budgeted cash expenses, $57,400.
Cash repayment of bank loan, $32,400.
Budgeted depreciation expense, $34,400.
Answers
Answer:
The ending cash balance on the month ended June 30 cash budget: $54,200
Explanation:
Ending cash balance = Beginning cash balance + Cash flow in - Cash flow out
In the company:
Cash flow in = Cash receipts from sales = $415,000
Cash flow out = Cash payments for purchases + Cash payments for salaries + Other cash expenses + Cash repayment of bank loan = $270,000 + $95,400 + $57,400 + $32,400 = $455,200
Ending cash balance = $94,400 + $415,000 - $455,200 = $54,200
Note: Depreciation is a non-cash accounting expense, so it doesn't involve cash flow.
X Company purchased a patent on January 3, 2017 from Y Company for $145,000. An attorney drew up the contract between X & Y at a total cost of $15,000, which was split equally by the parties. The patent had a carrying value of $90,000 on Y’s books. X expects to be able to benefit from the patent for 10 years, after which it is expected to be of little to no value. What will be the carrying value of the patent on X Company’s December 31, 2018 balance sheet?
Answers
Answer:
$122,000
Explanation:
Cost of Patent:
= Cost of patent + (total cost ÷ 2)
= 145,000 + (15,000 ÷ 2)
= $152,500
Accumulated depreciation for 2 years:
= (Cost of Patent ÷ Benefited years) × No. of years
= (152,500 ÷ 10) × 2
= $30,500
Carrying value on December 31,2018:
= Cost of Patent - Accumulated depreciation for 2 years
= $152,500 - $30,500
= $122,000
Excelor stock is expected to pay $3.00 per share as its next annual dividend. The firm has a policy of increasing the dividend by 11.0 percent annually. The stock has a market price of $13.65 and a beta of 2.8. The market risk premium is 8.56 percent and the risk-free rate is 4.90 percent. What is the cost of equity?
Answers
Answer:
30.92%
Explanation:
You find the answer by calculating the cost of equity using two methods; Dividend discount model and CAPM
Dividend discount model;
cost of equity; r = (D1/P0) +g
whereby, D1 = next year's dividend = 3.00
P0= current price = 13.65
g = dividend growth rate = 11% or 0.11 as a decimal
r = (3/13.65) + 0.11
r = 0.2198 + 0.11
r= 0.3298 or 32.98%
Using CAPM;
r = risk free + beta (Market risk premium)
r = 0.049 + (2.8 * 0.0856)
r = 0.049 + 0.2397
r = 0.2887 or 28.87%
Next, find the average of the two cost of equities;
=(32.98% + 28.87% )/2
= 30.92%
Why, with the monetary policy tools it had used prior to the financial crisis, could the Fed not control the federal funds rate?
(A) The Fed would have needed to conduct a massive open market purchase of government securities.
(B) Investor and consumer behavior was not conforming to normal patterns.
(C) Using the tools the Fed had available would have disrupted the financial system.
(D) Reserves would have needed to be increased by too large an amount.
Answers
Answer:
(C) Using the tools the Fed had available would have disrupted the financial system.
Explanation:
Every time the solution of any problem is not available with the resources we have, rather the available resources might add up to the cost of damage.
In the given case also, this general phenomenon is applicable.
As the Fed had monetary policy tools, which it even used earlier are not good for the problem of financial crisis. That the policies could even turn the situation worse as the country is already facing the crisis, and the policies would not contribute to the well being.
Rise Against Corporation is comparing two different capital structures: an all equity plan (Plan A) and a levered plan (Plan B). Under Plan A, the company would have 210,000 shares of stock outstanding. Under Plan B, there would be 150,000 shares of stock outstanding and $2.28 million in debt outstanding. The interest rate on the debt is 8%, and there are no taxes.a. If EBIT is S500,OOO, which plan will result in the higher EPS? b. If EBIT is $750,000, which plan will result in the higher EPS? c. What is the break-even EBIT?
Answers
Answer:
a. Plan A
b. Plan B
c. $638,400
Explanation:
The formula to compute the earning per share is shown below:
Earning per share = (Net income - interest) ÷ (Number of shares)
a. For Plan A
EPS = ($500,000) ÷ (210,000 shares) = $2.38
For Plan B
EPS = ($500,000 - $182,400) ÷ (150,000 shares) = $2.12
The interest is computed below:
= $2.28 million × 8%
= $182,400)
Plan A has higher EPS
b. For Plan A
EPS = ($750,000) ÷ (210,000 shares) = $3.57
For Plan B
EPS = ($750,000 - $182,400) ÷ (150,000 shares) = $3.78
The interest is computed below:
= $2.28 million × 8%
= $182,400)
Plan B has higher EPS
c. Break-even EBIT
(EBIT) ÷ (Number of shares) = (EBIT - Interest) ÷ Number of shares
(EBIT) ÷ (210,000) = (EBIT - $182,400) ÷$150,000
After solving this,
The EBIT would be $638,400
Economics can be described as the study of how people use ________ resources to satisfy ________ wants.A) unlimited; unlimitedB) unlimited; limitedC) limited; unlimitedD) limited; limited
Answers
Answer:
C) limited; unlimited
Explanation:
Economics can be described as the study of how people use limited resources to satisfy unlimited wants.
Economics is the study of how people use limited resources to satisfy unlimited wants, which requires making choices due to the scarcity of resources.
Explanation:Economics can be described as the study of how people use limited resources to satisfy unlimited wants. The correct answer to the student's question is C) limited; unlimited
Scarcity is a core concept in economics, indicating that there is a finite amount of resources available to meet the endless human wants and needs. Resources such as labor, tools, land, and raw materials are essential to produce the desired goods and services but are not available in unlimited quantities. Time is another scarce resource; with only 24 expendable hours in a day, people must make choices about how to allocate their time among work, leisure, and rest.
Because of these limitations, economics studies how individuals and societies prioritize and allocate their resources, making trade-offs to best satisfy the varying wants and needs. Every choice made implies another option foregone, which is known as an opportunity cost.
Maxine, age 35, earns $200,000 annually from ABC Incorporated. ABC sponsors a SIMPLE, and matches all employee deferrals 100% up to a 3% contribution. What is the maximum employee deferral contribution to Maxine’s SIMPLE account for this year?
Answers
Answer:
$12,500.
Explanation:
Please see attachment.
The maximum employee deferral contribution to Maxine’s SIMPLE account for this year is $6,000.
Explanation:The maximum employee deferral contribution to Maxine’s SIMPLE account for this year can be calculated using the employer's matching policy. ABC Incorporated matches all employee deferrals 100% up to a 3% contribution. Maxine's annual income is $200,000, so her maximum employee deferral contribution for this year would be 3% of $200,000, which is $6,000.
On January 1, Year 1, McClurg Corporation issues 5%, 11-year bonds with a face amount of $70,000 for $76,180. The market interest rate is 4%. Interest is paid semiannually on June 30 and December 31. Complete the necessary journal entry for the issuance of the bonds by selecting the account names from the drop-down menus and entering the associated dollar amounts. (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.)
Answers
Answer:
The journal entry for the issuance of the bond is shown below:
Explanation:
The entry to be posted on Jan 1
Cash A/c..............................................Dr $76,180
Premium on bonds payable A/c........Cr $6,180
Bonds Payable A/c..................................Cr $70,000
As bonds issued, so cash is increasing and any increase in cash is debited. Therefore, the cash account is debited. But the bonds issued at a premium so the premium on the bonds payable will be credited. And bonds payable account is credited.
The journal entry to record the issuance of the bonds would be: Debit Cash $76,180, Credit Bonds Payable $70,000, Credit Premium on Bonds Payable $6,180.
Explanation:To record the issuance of the bonds, the journal entry would be as follows:
Debit: Cash $76,180Credit: Bonds Payable $70,000Credit: Premium on Bonds Payable $6,180The debit to Cash represents the amount received from the issuance of the bonds. The credit to Bonds Payable represents the face value of the bonds. The credit to Premium on Bonds Payable represents the difference between the face value of the bonds and the amount received, which is recorded as a liability on the balance sheet.
At GetHelp Inc., after customer service representatives complete training, their phone calls are monitored to determine if they are applying the lessons about gathering pertinent information from callers. This evaluation best exemplifies a _____ measure.
Answers
Answer:
This evaluation best exemplifies a "behavior-level" measure.
Explanation:
Donald Kirkpatrick proposed a Four-level training evaluation model for evaluating the impact of training on employees.
The four levels are; Reaction, Learning, Behavior and Results.
The behavior level of Kirkpatrick's model is the third stage and it comes after employees have undergone learning/training. At this stage, the behavior is measured through monitoring and observation to determine if they are implementing what they have learnt.
This gives some insight into how effective the training was.
Therefore GetHelp Inc. by monitoring the phone calls of their customer service representatives are carrying out a "behavior-level" measure.
Heller Company offers an unconditional return policy to its customers. During the current period, the company records total sales of $850,000, with a cost of merchandise to Heller of $340,000. Based on past experience, Heller Company expects 4% of sales to be returned. How much in net sales will Heller Company recognize for the current period?
A. $510,000
B. $816,000
C. $489,600
D. $360,400
E. $850,000
Answers
Answer:
B. $816,000
Explanation:
The computation of the net sales is shown below:
= Total sales - sales returned amount
where,
Total sales is $850,000
And, the sales returned amount would be
= Total sales amount × sales returned percentage
= $850,000 × 4%
= $34,000
Now put these values to the above formula
So, the value would be equal to
= $850,000 - $34,000
= $816,000
You were recently selected for an important 2-year overseas assignment in Qatar. This is a big career opportunity and a chance to work in a high-growth region of your company’s business.
You just returned from a weeklong trip to Qatar, which was part of the introduction to your new team and your soon-to-be new home.
You certainly became aware that there were some noticeable cultural differences between your country and Qatar.
You are scheduled to move in 3 months.
Which of the following actions would be the MOST EFFECTIVE approach for improving your cultural competence?
a) Create a list of the things that you found to be different than what you expected during your visit and plan some strategies for adjusting to these differences.
b) Learn as much as you can about each member of your new team in order to smooth your transition into the group.
c) Stay in frequent communication with your new team in order to prepare for your upcoming move.
d) Focus your efforts on closing out all of your remaining projects and commitments related to your current position to get ready for your overseas assignment.
Answers
Answer:
The correct answer is letter "A": Create a list of the things that you found to be different than what you expected during your visit and plan some strategies for adjusting to these differences.
Explanation:
To improve your cultural competence, it is a good idea to come up with a list of the aspects that you found different than expected so you can have a clear idea of what you may struggle with. From that point, you can determine what are the possible solutions for each aspect to adjust your cultural differences.
Hannah Township has a General Fund, two Capital Projects Funds, one Permanent Fund, two Enterprise Funds, two Internal Service Funds, three Pension Trust Funds, and one Private-Purpose Trust Fund. Assuming all governmental and enterprise funds meet the major fund criteria, how many columns will the proprietary fund statement of net position have? Select one: a. Two (2). b. Three (3). c. Four (4). d. Five (5).
Answers
Answer:
c. Four (4)
Explanation:
The cash budget: Sit Down Corporation has a cash balance of $32,500 on April 1. The company must maintain a minimum cash balance of $30,000. During April, expected cash receipts are $48,500. Cash disbursements during the month are expected to total $56,100. Ignoring interest payments, how much will the company need to borrow during April?
Answers
Answer:
$5,100
Explanation:
Initial cash balance (IB) = $32,500
Expected cash receipts (EC) = $48,500.
Cash disbursements (CD) = $56,100
Amount borrowed (B) = ?
Assuming that the final balance must equal at least $30,000, the cash flow for april is given by:
[tex]\$30,000 = IB +EC-CD+B \\B= \$30,000 -\$32,500-$48,500+\$56,100\\B=\$5,100[/tex]
Sit Down Corporation will need to borrow $5,100 during April to maintain a minimum cash balance of $30,000.
A $1,000,000 lottery prize pays $50,000 per year for the next 20 years. If the current rate of return is 4.25%, what is the present value of this prize? (Assume the lottery pays out as an ordinary annuity. Round your answer to the nearest cent.)
Answers
The present value of a $1,000,000 lottery prize that pays out $50,000 annually for 20 years, taking into account a 4.25% interest rate, is approximately $577,462.86.
Explanation:The present value of the lottery prize can be calculated using the formula for the present value of an ordinary annuity. An annuity is a series of equal payments made at regular intervals. The formula for the present value of an ordinary annuity takes into account the periodic payment amount, the interest rate, and the number of payment periods.
In this case, the lottery payout is an annuity with a yearly payment of $50,000, the interest rate is 4.25% (expressed as 0.0425 as a decimal), and there are 20 payment periods.
So, the formula to calculate the present value of the annuity is as follows: PV = Pmt * [(1 - (1 + r)^-n) / r]
Where:
PV is the present value of the annuity,Pmt is the recuring payment amount,r is the interest rate per period, andn is the number of periods.Substituting the given values into the formula:
PV = $50,000 * [(1 - (1 + 0.0425)^-20) / 0.0425]
When you calculate the expression inside the brackets first and then multiply by $50,000, you get a present value of approximately $577,462.86.
This means that the $1,000,000 lottery prize, paid out as $50,000 per year for 20 years and discounted at an interest rate of 4.25%, is roughly worth $577,462.86 in today's dollars.
Learn more about Present Value of Annuity here:https://brainly.com/question/17112302
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Which one of the following stocks is correctly priced if the risk-free rate of return is 2.4 percent and the market risk premium is 7.80 percent? Stock Beta Expected Return A 0.72 8.43% B 1.48 14.00% C 1.40 13.32% D 1.06 10.58%
Answers
Answer:
Stock C
Explanation:
In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below
Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)
The (Market rate of return - Risk-free rate of return) is also called market risk premium
For Stock A
= 2.4% + 0.72 × 7.80%
= 2.4% + 5.616%
= 8.016%
For Stock B
= 2.4% + 1,48 × 7.80%
= 2.4% + 11.544%
= 13.944%
For Stock C
= 2.4% + 1.40 × 7.80%
= 2.4% + 10.92%
= 13.32%
For Stock D
= 2.4% + 1.06 × 7.80%
= 2.4% + 8.268%
= 10.668%
Since we see that the expected rate of return for stock C is equal to the expected rate of return so the stock C is correctly priced
Henry Hobbs, age 51, has compensation of $72,000. The normal retirement age for his 457(b) plan is age 62. Henry has unused deferrals totaling $21,000 as of January 1, 2019. How much can Henry defer into his 457(b) public plan for 2019?
Answers
Answer:
Henry's maximum amount defer in public plan is = $25000.
Explanation:
given data
age = 51
compensation = $72,000
normal retirement age = 62
unused deferrals totaling = $21,000
to find out
How much can Henry defer into his 457(b) public plan for 2019
solution
we know that as per plan 457(b) is an Employer sponsored
and tax favored retirement savings account
so here in 2019 Employees can contribute = upto $19000
and
Employees over age = 50
he can contribute additional = $6000
and making maximum contribution limit = $25000
so here
Henry's maximum amount defer in public plan is = $25000
The Hot Dog Shack wants to raise $1.2 million by selling some coupon bonds at par. Comparable bonds in the market have a 6.5 percent annual coupon, 15 years to maturity, and are selling at 97.687 percent of par. What coupon rate should The Hot Dog Shack set on its bonds?
Answers
Answer:
6.75%
Explanation:
In this question, we use the Rate formula which is shown in the spreadsheet.
The NPER represents the time period.
Given that,
This is correct Present value = $976.87
Assuming figure - Future value or Face value = $1,000
PMT = 1,000 × 6.5% = $65
NPER = 15 years
The formula is shown below:
= Rate(NPER,PMT,-PV,FV,type)
The present value come in negative
So, after solving this, the answer would be 6.75%
Juliette formed a new business to sell sporting goods this year. The business opened its doors to customers on June 1. Determine the amount of start-up costs Juliette can immediately expense (not including the portion of the expenditures that are amortized over 180 months) this year in the following alternative scenarios:
a. She incurred start-up costs of $4,200. what amount of start-up costs immediately expensed ?___
b. She incurred start-up costs of $45,500. what amount of start-up costs immediately expensed ?___
c. She incurred start-up costs of $53,800.what amount of start-up costs immediately expensed ?___ .
d. She incurred start-up costs of $65,500.what amount of start-up costs immediately expensed ?___
e. How would you answer parts (a) through (d) if she formed a partnership or a corporation and she incurred the same amount of organizational expenditures rather than start-up costs (how much of the organizational expenditures would be immediately deductible)?
Answers
Answer:
1) She incurred start-up costs of $2,500.
a) Amount of start up costs immediately expensed?
$2,500, computed as follows:
1 Maximum immediate expense 5000 S 195(b)(1)(ii)
2 Total start-up costs 2500 Given In
problem
3 Phase-out threshold 50000 S 195(b)(1)(ii)
4 Immediate expense phase-out 0 (2-3)
Allowable immediate expense 2500 Lessor of (2)or-(1)-(4)
______________
2) She incurred start-up costs of $41,000
a) Amount of start up cost immediately expensed
$5000, computed as follows:
1 Maximum immediate expense 5000 S 195(b)(1)(ii)
2 Total start-up costs 41000 Given In
problem
3 Phase-out threshold 50000 S 195(b)(1)(ii)
4 Immediate expense phase-out 0 (2-3)
Allowable immediate expense 5000 Lessor of (2)or-(1)-(4)
3) She incurred start-up costs of $51,100.
a) Amount of start up cost immediately expensed
$3900, computed as follows:
1 Maximum immediate expense 5000 S 195(b)(1)(ii)
2 Total start-up costs 51100 Given In
problem
3 Phase-out threshold 50000 S 195(b)(1)(ii)
4 Immediate expense phase-out 1100 (2-3)
Allowable immediate expense 3900 Lessor of (2)or-(1)-(4)
4) She incurred start-up costs of $61,250.(Leave no answer blank. Enter zero if applicable.)
$0, computed as follows:
1 Maximum immediate expense 5000 S 195(b)(1)(ii)
2 Total start-up costs 61250 Given In
problem
3 Phase-out threshold 50000 S 195(b)(1)(ii)
4 Immediate expense phase-out 11250 (2-3)
Allowable immediate expense 0 Lessor of (2)or-(1)-(4)
5) How would you answer parts (a) through (d) if she formed a partnership or a corporation and she incurred the same amount of organizational expenditures rather than start-up costs (how much of the organizational expenditures would be immediately deductible)?
Answer:
The answers would be the same if these were organizational expenditures instead ofstart-up costs.Note, however, that organizational expenditures only apply tocorporations and partnerships and do not apply to businesses organized as soleproprietorships
Explanation:
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Juliette can immediately expense $4,200 for scenario a, $5,000 for scenario b, $1,200 for scenario c, and $0 for scenario d. If the costs were part of organizational expenses rather than start-up costs, the same principles apply.
Explanation:The amount Juliette can immediately expense for her start-up costs is determined under the U.S. tax code 195, which allows a business to expense the first $5,000 of start-up costs in the year the business starts, but this $5,000 amount is reduced by the amount by which the start-up expenditures exceed $50,000.
For scenario a, she incurs $4,200 in start-up costs, which is less than the allowed $5,000. So she could expense the full $4,200 immediately. In scenario b, the start-up costs amount to $45,500 and are less than $50,000. The full $5,000 can be immediately expensed. In scenario c, the start-up costs are $3,800 in excess of $50,000. This means she can immediately expense $1,200 ($5000 - $3,800). In scenario d, her start-up costs exceed $50,000 by $15,500. As the costs exceed the threshold, she cannot expense any amount immediately. If the costs were part of organization expenses for a partnership or corporation, the same principles would apply under section 248 for corporations and 709 for partnerships.Learn more about Start-up cost expensing here:https://brainly.com/question/34092391
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On January 1, 2016, Woodstock, Inc. purchased a machine costing $40,000. Woodstock also paid $1,000 for transportation and installation. The expected useful life of the machine is 6 years and the residual value is $5,000.How much is the annual depreciation expense assuming use of the straight-line depreciation method?A. $6,100.B. $6,000.C. $5,950.D. $5,750.
Answers
Answer:
B. $6,000
Explanation:
The computation of the annual depreciation expense under the straight-line method is shown below:
= (Original cost - residual value) ÷ (useful life)
= ($41,000 - $5,000) ÷ (6 years)
= ($36,000) ÷ (6 years)
= $6,000
The original cost is computed below:
= Purchase value + transportation and installation cost
= $40,000 + $1,000
= $41,000
Stephanie's building, which was used in her business, was destroyed in a fire. Stephanie's adjusted basis in the building was $175,000, and its FMV was $210,000. Stephanie filed an insurance claim and was reimbursed $200,000. In that same year, Stephanie invested $180,000 of the insurance proceeds in another business building. Assuming the proper election is made to defer gain, Stephanie's basis in the new building will be
Answers
Answer:
$1,75,000
Explanation:
Please see attachment
When they produce 20,000 units per month, Sanders Incorporated has variable costs of $392,000 and fixed costs of $242,000. If Sanders increases their production to 25,000 units, by how much will they have to increase their budget?
A : $98,000
B : $158,500
C : $490,000
D : $792,500
Answers
Answer:
increased in budget = $98000
correct option is A $98000
Explanation:
given data
produce = 20,000 units per month
variable costs = $392,000
fixed costs = $242,000
increases production = 25,000 units
to find out
how much will they have to increase their budget
solution
we get here total cost or present budget that is
total cost = variable cost + fixed cost
total cost = $392000 + $242000
total cost = $634000
and
variable cost per unit will be here
variable cost per unit = [tex]\frac{variable\ costs}{produce}[/tex]
variable cost per unit = [tex]\frac{392000}{20000}[/tex]
variable cost per unit = 19.6
and
variable cost for increased production = increases production × variable cost per unit
variable cost for increased production = 25000 × 19.6
variable cost for increased production = 490000
and
total cost of increased production = fixed cost + variable cost for increased production
total cost of increased production = $242000 + $490000
total cost of increased production = $732000
and
increased in budget = $732000 - $634000
increased in budget = $98000
correct option is A $98000
Six months ago, you purchased 2,700 shares of ABC stock for $44.81 a share. You have received dividend payments equal to $.50 a share. Today, you sold all of your shares for $47.49 a share. What is your total dollar return on this investment?
Answers
The total dollar return on the investment is calculated by adding the total capital gain ($7,236) and the total dividends ($1,350) which results in a total return of $8,586.
The question involves calculating the total dollar return on an investment in the stock market. To determine the total dollar return, we must consider both the capital gain (or loss) and the dividend payments received during the investment period.
First, let's calculate the capital gain:
Sale price per share: $47.49
Purchase price per share: $44.81
Number of shares: 2,700
Capital gain per share: $47.49 - $44.81 = $2.68
Total capital gain: $2.68 \\u00d7 2,700 shares = $7,236
Next, let's calculate the dividend earnings:
Dividend per share: $0.50
Total dividends: $0.50 \\u00d7 2,700 shares = $1,350
Now, we can calculate the total dollar return:
Total capital gain: $7,236
Total dividends: $1,350
Total dollar return: $7,236 + $1,350 = $8,586
Wright Services, Inc., has $ 8 comma 800 cash on hand on August 1. The company requires a minimum cash balance of $ 7 comma 400. August cash collections are $ 548 comma 400. Total cash payments for August are $ 563 comma 380. Prepare a cash budget for August. How much cash, if any, will Wright need to borrow by the end of August?
Answers
Answer:
- $13,580
Explanation:
The preparation of the cash budget for August month is shown below:
Cash on Hand on August 1 $8,800
Add: August cash collections $548,400
Total cash available $557,200
Less: Total cash payments - $563,380
Ending cash balance - $6,180
Less: Minimum cash balance - $7,400
Borrowed amount - $13,580
The Edward Company is expected to pay a dividend of D1 = $3.00 per share at the end of the year, and that dividend is expected to grow at a constant rate of 5.00% per year in the future. The company's beta is 1.15, the market risk premium is 5.50%, and the risk-free rate is 4.00%. What is the company's current stock price?
Answers
Answer
The answer and procedures of the exercise are attached in the following image.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.