stock lowers the stock outstanding‚ it is subtracted from Stockholders’ Equity so that the stockholders’ net equity is for outstanding shares only. Treasury stock is‚ in essence‚ a reduction in paid-in capital. 3-36: Which depreciation method will result in the most depreciation over the life of an asset? Irrespective of the
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total revenues. To estimate expenses‚ we are given the breakdown of fixed and variable expenses for each of the expense items. The fixed expenses increase by the inflation rate‚ whereas the variable expenses adjust with the change in revenue. Depreciation is given as constant and interest expense is also taken as constant as we have not decided on the financing of the EFN. In addition some new expenses are added due to the new initiatives. This includes salaries for four national accounts managers
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accounting h. Managerial accounting i. Financial Accounting j. Managerial accounting 10-3 Classifying Costs: Product or G‚ S‚ & A/ Asset or Expense a. Production supplies- Product cost‚ asset b. Depreciation on Administrative Building- G‚ S‚ & A‚ expense c. Depreciation on manufacturing equipment – Product cost‚ expense d. Research and development costs- G‚ S‚ & A‚ Expense e. Cost to set up manufacturing equipment – Product cost‚ asset f. Utilities used in factory-
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Income | | $0.8 | $2 | $2 | $2 | $2 | $2 | | + | Operating Saving | | $2 | $3.5 | $3.5 | $3.5 | $3.5 | $3.5 | | - | Depreciation | | $3 | $3 | $3 | $3 | $3 | $3 | | | EBIT | | -$0.2 | $2.5 | $2.5 | $2.5 | $2.5 | $2.5 | | - | Tax (40%) | | -$0.08 | $1 | $1 | $1 | $1 | $1 | | | EAT | | -$0.12 | $1.5 | $1.5 | $1.5 | $1.5 | $1.5 | | + | Add back Depreciation | | $3 | $3 | $3 | $3 | $3 | $3 | | | Total Operating Cash Flow | | $2.88 | $4.5 | $4.5 | $4.5 | $4.5 | $4.5 | |
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13. The interest on a $4‚000‚ 6%‚ 60-day note receivable is $40. 14. The maturity value of a $2‚000‚ 6%‚ 60-day note receivable dated February 10th is $2‚020 15. A disadvantage of the corporate form of business is government regulation.. 16. James Corporation issued 2‚000 shares of $5 par value common stock for $20 per share. The entry to record this transaction includes a credit to Paid-in Capital in Excess of Par for $30‚000.
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Learning Task Number Four The Henry Furniture Co. is a new company and has numerous fixed assets that need to be depreciated. You can help Henry by determining the depreciation rates for the assets and the amount of depreciation for year one. The assets were purchased at various times during the year (hint: watch out for the dates). The following assets will be held by the company for at least the next two years (In other words‚ year two will be a full year for all of the assets). Please fill
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information include: a. b. c. 4. d. observing e. classifying The financial statement or statements that pertain to a stated period of time is (are) the: a. b. c. d. e. 3. interpreting reporting purchasing accumulated depreciation depreciation expense sales revenue d. e. marketing expense interest expense A brand new company has a building costing $10‚000‚ machinery costing $5‚000‚ cash of $700‚ and a bank loan of $7‚850. What is the owner’s equity? a. b. c.
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reasons why the cash position for the business does not equal to the profit for the period. By showing the spreadsheet‚ two financial statements and looking into theories of matching principle‚ prepayments and accruals‚ provisions(bad debts and depreciation)‚ it is not hard to distinguish the cash flow from the profit. Content It is vital to understand the cash position and the profit do not necessarily go together when running business. Profitable businesses still can go out of business because
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truck and an overhead pulley system‚ in this year’s capital budget. The projects are independent. The cash outlay for the truck is $17‚100 and that for the pulley system is $22‚430. The firm’s cost of capital is 14%. After-tax cash flows‚ including depreciation‚ are as follows: Year | Truck | Pulley | 1 | $5‚100 | $7‚500 | 2 | 5‚100 | 7‚500 | 3 | 5‚100 | 7‚500 | 4 | 5‚100 | 7‚500 | 5 | 5‚100 | 7‚500
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Corporation ………… $1‚000‚000.00 IFRS adjustments: Add: Reversal of inventory cost written down to replacement cost….. 10‚000.00 Less: Additional depreciation of building after 2011 revaluation…….. (25‚000.00) Impairment loss on intangible assets…………… (5‚000.00) Add: Deferred research and development costs…….. 80‚000.00
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