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1 year ago

A company's plan for the acquisition of long-lived assets, such as buildings and equipment, is commonly called a:

1 answer:

7 0

A company's plan for the acquisition of long-lived assets, such as buildings and equipment, is commonly called a Capital Budget.

<h3>What is a Capital Budget?</h3>

The procedure a company uses to assess potential big projects or investments is called capital budgeting.
Before a project is accepted or denied, capital budgeting is necessary. Examples of such projects include the construction of a new plant or a significant investment in a third-party enterprise.
It is a means of locating a superior offer for the expansion of the company.
A company's bottom line is frequently affected by significant capital decisions, which are frequently tied to capital planning.
In capital budgeting, projects that improve a business are chosen. Almost everything, including the acquisition of land or the purchase of fixed assets like a new truck or machinery, can be included in the capital budgeting process.

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Steve is in charge of accounting for the purchase of equipment at Cal Works, Inc. The company has a policy that all expenditures

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Answer: Materiality

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In other words, the transactions should be recorded in such a way that it gives some value to the stakeholders.

Therefore, in the given case, steve reported two expenditures in the fiancial statement as the amount is significant, thus,must be holding the value to stakeholders.

Hence the correct option is D.

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3 years ago

Ajax Corp's sales last year were $400,000, its operating costs were $362,500, and its interest charges were $12,500. What was th

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Answer:

3 times

Explanation:

Times Interest earned is a financial ratio that shows how many times an entity's net income or earnings before interest and taxes can be used to settle the company's interest expense.

It is given as the ratio of earnings before interest and tax to interest expense.

Earnings before interest and taxes is the difference of sales and operating costs.

= $400,000 - $362,500

= $37,500

Hence, the firm's times-interest-earned (TIE) ratio

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3 years ago

In reviewing the accounting records of the transportation services fund, an internal service fund of douglas city, you notice th

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The reason why the fund uses the budgetary accounts because it is most likely needed that the funding budget to be approved legally by the city council in order for the budget funds to be used by the members or people responsible of handling the budgets.

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3 years ago

Higgins Company plans to incur $380,000 of salaries expense if a capital project is implemented. Assuming a 40% tax rate, the sa

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Answer:

d) $228,000 outflow

Explanation:

Calculation for the amount that the salaries should be reflected in the analysis

Using this formula

Salaries=Salaries expense-(Salaries expense*Tax rate)

Let plug in the formula

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Salaries=$380,000-$152,000

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2 years ago

The derived demand for an input will rise when it is highly productive in ______. Multiple select question. increasing the costs

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Answer:

Tt is highly productive in reducing the costs to produce a product.

it is highly productive in producing a highly valued commodity.

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A product has derived demand If its demand is dependent on the demand for other products.

For example, there would be no need to demand for labour if no one demands for goods.

The derived demand for a good will increase if it reduces the price of the product and if it is important in the production of a good

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2 years ago