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2 years ago

A necessary condition to use the equity method of reporting for an equity investment is that the investor company must:____.

1 answer:

4 0

The ability of the investor business to exert significant influence over the operating and financial policies of the investee is a requirement for using the equity method of reporting an equity investment.

A business uses the equity method as an accounting approach to record the earnings made by its investment in another business. The investor firm declares the revenue generated by the other company on its income statement using the equity method of accounting, in a proportional amount to the equity stake it has in the other company. When a firm has significant control over the company it is investing in, the equity method is used to value the investment.

Learn more about the equity method here.

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Ireland Corporation obtained a $40,000 note receivable from a customer on June 30, 2011. The note, along with interest at 6%, is

Paul [167]

Answer:

$39,220

Explanation:

The maturity value of the note receivable on June 30, 2012

= Principal + Interest

= $40,000 + $40,000 x 6%

= $40,000 + $2,400

= $ 42,400

The note is discounted on September 30, 2011. Time period remaining to go till maturity as on September 30, 2011

= 12 - 3 months ( July, Aug and Sep)

= 9 months.

Amount of deduction

= $ 42,400 x 10% x 9/12

= $ 3,180

Finally, the Cash received by Ireland will be

= Maturity value - Discount

= $42,400 - $ 3,180

= $39,220

5 0

3 years ago

When evaluating service quality, _____ refers to the knowledge and courtesy of employees and their ability to convey trust. a. a

sesenic [268]

An assurance means the knowledge and courtesy of employees and their ability to convey trust.

<h3>What is an assurance?</h3>

This refers to the set of systematic activities that are intended to ensure that the objectives of a project are fit for purpose.

Hence, in evaluation of service quality, its means the knowledge and courtesy of employees and their ability to convey trust.

Therefore, the Option A is correct.

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6 0

1 year ago

Balance Sheet Below are items that may appear on the balance sheet. Required: Match each item with its appropriate classificatio

JulijaS [17]

Answer:

Item Classification

1. Buildings - Property, plant, and equipment

2. Copyright - Intangible assets

3. Supplies - Current assets

4. Unearned service revenue - Current liabilities

5. Prepaid insurance - Current assets

6. Common stock - Contributed capital

7. Rent payable - Current liabilities

8. Accounts receivable - Current assets

9. Allowance for doubtful accounts - Retained earnings

10. Bonds payable - Long-term liabilities

Explanation:

A. Current assets - Assets that exist for a period not exceeding 12 months such as supplies.

B. Property, plant, and equipment - Assets of a Physical Nature that are expected to be used for more than a year.

C. Intangible assets - Assets that do not have a physical nature and are expected to be used for more than a year.

D. Current liabilities - Short term obligation due within a period of 12 months.

E. Long-term liabilities - Long term obligations due within a period exceeding 12 months.

F. Contributed capital - Capital raised by owners of the company excluding reserves attributed to them.

G. Retained earnings - Amounts set aside out of profits that are distributable to the shareholders of the company. Therefore Incomes and expenses are found here.

3 0

2 years ago

When actual revenue ______ what the revenue should have been, the variance is labeled favorable.

xeze [42]

When actual revenue <u>exceeds</u> what the revenue should have been, the variance is labelled favourable.

Hope that helps!

6 0

2 years ago

Read 2 more answers

Compare and contrast the roles of the federal government as both promoter and regulator of industrial development and market cap

Tema [17]

Explanation:

Compare and Contrast ->

Roles of the federal government -> Promoter & Regulator of industrial growth

U.S.Government => Promoter & Regulator of industrial growth

Pacific Railway Act (1862)-They have been granted 20 square miles of land per 1 mile of the track laid down. It strongly encouraged the construction of transcontinental railway lines, contributing to five different transcontinental roads: Union Pacific RR, Central Pacific RR, South Pacific RR, North Pacific RR and the Great North. The Grants Act of Morrill Land (1862)-gave state free land.

U.S.Government => Roles of the federal government

Sherman Antitrust Act (1890)The purpose was to promote economic competition through the regulation of shares, cartels and monopolies. It was very uncompromisingly applied Interstate Trade Act (1887). It also prohibits discrimination against shippers and pays more on the same train for shorter routes than for longer routes.

Thesis:

In the 19th Century and in themid-19th Century, the government of the United States was much more a proponent of industrialisation then an industrialisation regulator than a regulator.

In the year 1862, for instance, congress took place on the Pacific Railway Act, which gave the railway lines 20 acres per mile. This eventually culminated in five transcontinental trains: Union Pacific Railways, Central Pacific Railways, North American Railways, South Pacific Railways, and the Great North.In end, this resulted in the creation of booming towns in the west, encouraging manufacturers to relocate to their inhabitants and enabling businesses to sell their products to remote locations that were once hard to reach. Congress also enacted Morrill's 1861 Tariff Act which substituted for a higher tariff for the limited import tariff inserted in 1816. This shielded businesses from foreign competitors and increased their profits so that they could increase their power. The US government in general has been a more aggressive manufacturing supporter.

4 0

3 years ago