Inc. has sales of $585‚000‚ costs of $273‚000‚ depreciation expense of $71‚000‚ interest expense of $38‚000‚ and a tax rate of 35 percent. Building an income statement for this company‚ what is the net income? Lifeline‚ IncIncome Statement | Net sales $585‚000 Cost $273‚000------------------------------------------------- Depreciation
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recording depreciation as an expense over a period is to spread the initial purchase price of the fixed asset over its useful life. Each time a company prepares its financial statements‚ it records a depreciation expense to allocate the loss in value of the machines‚ equipment or cars it has purchased. However‚ unlike other expenses‚ depreciation expense is a "non-cash" charge. This simply means that no money is actually paid at the time in which the expense is incurred.” Depreciation is a very
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the net income of the company. What are the differences between the LIFO and FIFO methods? D2: A variety of depreciation methods are used to allocate the cost of an asset to all of the accounting periods benefited by the use of the asset. Your client has just purchased a piece of equipment for $100‚000. Explain the concept of depreciation. Which of the following depreciation methods would y... For downloading more tutorials visit - https://bitly.com/12B12YQ Think carefully about
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Expenses – Allocating assets to expense to reflect expenses incurred during the period. Example: Recording supplies used by increasing (debiting) Supplies Expense and decreasing (crediting) Supplies or recording depreciation expense and reducing PPE (or increasing accumulated depreciation). 2. Unearned Revenues – Adjusting unearned revenues to recognize only revenues earned during the period. Example: Recording service fees earned by decreasing (debiting) Unearned Service Fees‚ a liability‚ and
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Ref. a Description Cash Debit 30.000 Paid-in capital - Common Stock b Cash 30.000 15.000 Notes Payable Interest Expense 15.000 75 Notes Payable c Rent Expense 75 8400 Cash d Credit Equiptment 8400 7000 Cash Depreciation Expense 7000 117 Accumulating Depreciation 117 ASSET ACOUNTS CASH 30.000 15.000 8.400 7.000 Other Assets 7.000 LIABILITY ACCOUNTS NOTES PAYABLE 15.000 75 EQUITY ACCOUNTS - PAID-IN CAPITAL COMMON STOCK 30.000 EQUITY ACCOUNTS - RETAINED EARNINGS OCI ACCOUNTS
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Receivable‚ No. 144 Accumulated Depreciation—Cottages‚ No. 150 Accumulated Depreciation—Furniture‚ No. 212 Salaries Payable‚No. 230 Interest Payable‚No. 320 Retained Earnings‚No. 620 Depreciation Expense—Cottages‚ No. 621 Depreciation Expense—Furniture‚ No. 631 Supplies Expense‚ No. 718 Interest Expense‚ and No. 722 Insurance Expense. Other data: 1. Insurance expires at the rate of $400 per month. 2. A count on August 31 shows $600 of supplies on hand. 3. Annual depreciation is $6‚000 on cottages and $2
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MARKETING FINANCE- NOTES Marketing is the management process responsible for identifying‚ anticipating and satisfying customer requirements profitably.’ The new one is: ‘The strategic business function that creates value by stimulating‚ facilitating and fulfilling customer demand. It does this by building brands‚ nurturing innovation‚ developing relationships‚ creating good customer service and communicating benefits. By operating customer-centrically‚ marketing brings positive return on investment
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SUMMARY OF IAS 16 Objective of IAS 16 The objective of IAS 16 is to prescribe the accounting treatment for property‚ plant‚ and equipment. The principal issues are the recognition of assets‚ the determination of their carrying amounts‚ and the depreciation charges and impairment losses to be recognised in relation to them. Scope IAS 16 does not apply to assets classified as held for sale in accordance with IFRS 5 exploration and evaluation assets (IFRS 6) biological assets
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following assumptions: 1. Calculations are done on a nominal basis‚ converting the salvage value estimate from a real to a nominal value (638 = 500(1.05)5) using the 5% inflation estimate; salvage = book value so no taxes are incurred on salvage. 2. Depreciation is calculated at [4‚000 – 638 (salvage) ]/ 5 = 672.4 per year. 3. Cars sales occur in year 1
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accumulated OCI CHAPTER 10 - PPE -Identify the different components of PPE (property‚ plant‚ equipment) and related accumulation depreciation. Locate the depreciation methods and estimates used for the calculations. -Identify valuation basis (market value or historical costs) and describe the impairment testing procedure for PPE. -Identify the amount of depreciation expense in the IS (or the notes) Compute profitability ratios and provide a short analysis (see exercise 10-26B). CHAPTER 11
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