Net Present Value/Present Value Index The management team at Savage Corporation is evaluating two alternative capital investment opportunities. The first alternative‚ modernizing the company’s current machinery‚ costs $45‚000. Management estimates the modernization project will reduce annual net cash outflows by $12‚500 per year for the next five years. The second alternative‚ purchasing a new machine‚ costs $56‚500. The new machine is expected to have a five-year useful life and a $4‚000
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Uniform CPA Examination Examination Content Specifications Effective Upon the Launch of the Computer-based Uniform CPA Examination Prepared by the Board of Examiners of the American Institute of Certified Public Accountants Questions pertaining to this decision paper should be directed to Gregory Johnson‚ Director‚ CPA Examination‚ at (201) 938-3376 or gjohnson@aicpa.org. June 14‚ 2002 Uniform CPA Examination Examination Content Specifications The content of the Uniform CPA Examination
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received a benefit. 2. In governmental fund-type financial statements‚ the assets acquired under a capital lease would be reported at a) They are not reported in the fund financial statements. b) The present value of the required lease payments. c) The undiscounted total of required lease payments. d) The total of all payments required under the lease. 3. In the government-wide financial statements‚ the assets acquired under a capital lease would be reported
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party of the contract. When a source document does not be‚ for example‚ when a cash receipt is not provided by a trader or is missing‚ a document should be generated as soon as possible after the transaction‚ using other documents such as bank statements to support the information on the generated source document. 3. This part analyses and classifies the transaction. This step of the process involves quantifying the transaction in financial terms‚
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a profit iii. Sources of Capital 1. Entrepreneur’s investment in the company a. Return of the contribution i. Hope to get back money he or she contributed to the company b. Return on the Contribution i. Additional money above the amount he or she originally contributed to the company 2. Borrowing a. Borrow money from creditors (Banks) b. Occurs when company’s profits and owner’s contributions are not large enough to finance growth c. Solvent i. Company can pay off its debts II. Forms that
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accounting period should be reckoned in the same period‚ irrespective of the fact whether these expenses have been paid in cash or not in that year. The same holds true for revenues‚ i.e.‚ revenues earned in a specific accounting period are construed as incomes of the same period‚ irrespective of their receipts. This concept is also known as the accrual theory of accounting or accrual accounting. This concept applies equally to revenues and expenses. In the accrual basis of accounting Revenue is recognized
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expense 24 24 24 Total Variable cost per revenue hour 28.7 28.7 28.7 3. Income statement for Salem Data Services From the article‚ I know that intracompany work was billed at $400 per hour‚ and commercial sales were billed at $800 per hour. So‚ intracompany contribution margin: $400-$28.7= $371.3/hr Commercial contribution margin: $800-$28.7=$771.3/hr Sales revenue $192‚400 Variable cost $9844.1 Contribution margin $182‚555.9 Fixed cost $212‚939 Net loss ($30‚383.1) 4. Revenue =
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680‚000 cr 546‚200 dr Service cost 58‚000 dr 58‚000 cr Interest Cost $680‚000 x 9% = $61‚200 61‚200 dr 61‚200 cr Actual return 52‚280 cr 52‚280 dr Unexpected gain/ loss Amortization of PSC 17‚000 dr. 17‚000 cr Contributions 65‚000 cr 65‚000 dr Benefits 40‚000 dr 40‚000 cr Journal entry for 2012 83‚920 dr 65‚000 cr 103‚000 dr 121‚920 cr Accumulated OCI‚ Jan. 1‚ 2012 -0- Balance‚ Dec. 31‚ 2012 103‚000 dr 135‚720 cr 759‚200 cr 623‚480 dr
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by the company’s lawyer. Financial Documents - A business uses financial documents to stay within its budget‚ prepare budget proposals and file tax returns. These documents include receipt records‚ payroll reports‚ paid bills‚ bank statements‚ income statements‚ balance sheets and tax reporting forms. These documents may be prepared by the company’s accountant. A business owner uses these documents to determine the financial success of the company and to identify areas that are unproductive. A
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Waterways Continuing Problem 1 Waterways Continuing Problem WCP1 Waterways Corporation is a private corporation formed for the purpose of providing the products and the services needed to irrigate farms‚ parks‚ commercial projects‚ and private homes. It has a centrally located factory in a U.S. city that manufactures the products it markets to retail outlets across the nation. It also maintains a division that provides installation and warranty servicing in six metropolitan areas. The mission
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