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1 year ago

Identify the impact of each of the given transactions on the accounting equation.

Business

1 answer:

lukranit [14]1 year ago

7 0

Accounting equation impact will be as follows:

1. Grow in both assets and liabilities.

2. Reduce the investors' equity and assets.

3.Both asset growth and asset decline.

4.Boost liabilities while lowering stockholders' equity

More about accounting equation:

The entire assets of a corporation are equal to the total of one's liabilities and shareholders' equity, according to the accounting equation, also known as the balance sheet equation or the fundamental accounting equation.

The assets and liabilities listed on the balance sheet serve as the foundation for any company's financial status, no matter how big or little. The third part of the balance sheet is owners' equity, often known as shareholders' equity. The relationship between these three crucial elements is depicted by the accounting equation.

Complete Question:

Identify the impact on the accounting equation of each of the following transactions.

1.Purchase office supplies on account.

2.Paid secretary weekly salary.

3.Purchased office furniture for cash.

4.Received monthly utility bill to be paid at later time

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During its first year of operations, Silverman Company paid $10,285 for direct materials and $9,800 for production workers' wage

Salsk061 [2.6K]

Answer:

D.$3,950

Explanation:

Production = ($10,285 + $9,800 + $8,800) ÷ 5,450units

=$28,885÷5,450 units

= $5.3per unit

COGS = 3,300 units sold × $5.3 per unit

= $17,490

Net income = Revenue − Cost of goods sold − Selling and administrative expenses

Net income = (3,300 units × $7.80 per unit) − (3,300 units sold × $5.3per unit) − $4,300

=(25,740-17,490)-$4,300

= 8,250-$4300

=$3,950

Therefore Silverman's net income for the first year in operation is $3,950

4 0

2 years ago

Instruck inc. is a real estate firm based in colorado. the company ensures that employees' pay is dependent on what they are cap

Kruka [31]

Based on the above scenario, the pay structure being exemplified Skill-based pay systems. Skill-based pay systems are pay structures that set pay as indicated by the workers' level of expertise or learning and what they can do. Paying For abilities bodes well at associations where changing innovation expects workers to constantly broaden and extend their insight.

6 0

3 years ago

Suppose the revenue from producing (and selling) x units of a product is given by Upper R (x )equals 10 x minus . 04 x squared

Volgvan

Answer:

marginal revenue is -6

and production levels 200, 50

Explanation:

given data

R(x) = 10 x - 0.04 x²

solution

we have given

R(x) = 10 x - 0.04 x²

so here R'(x) is

R'(x) = 10(1) - 0.4 (2x)

R'(x) = 10 - 0.8 x ....................1

so here at x is 20 marginal revenue will be

R'(20) = 10 - 0.8(20)

R'(20) = 10 - 16

R'(20) = - 6

and

when revenue is $400

R(x) = 400

400 = 10 x - 0.04 x²

x= 200, 50

7 0

3 years ago

Calculate the required rate of return for Mercury Inc., assuming that investors expect a 5% rate of inflation in the future. The

My name is Ann [436]

Answer:

Option C is correct.

<u>The required rate of return for Mercury Inc., assuming that investors expect a 5% rate of inflation in the future is 18%.</u>

Explanation:

Real risk free rate = 3%

Inflation Premium = 5%

Nominal risk free rate Rf = Real risk free rate + Inflation Premium = 3% + 5% = 8%

Market risk premium (Rm –Rf) = 5%

Beta = 2

As per CAPM, required rate of return = Rf + beta * (Rm – Rf) = 8% + 2 * 5% = 18%

8 0

3 years ago

dentify (by letter) each of the following characteristics as being an advantage, a disadvantage, or not applicable to the corpor

belka [17]

Answer:

1. Separate legal entity ⇒ ADVANTAGE

This is an advantage because it means that the owners are not liable for the actions of the company. If the company goes bankrupt for instance, they will not have to pay for it with their own finances.

2. Taxable entity resulting in additional taxes ⇒ DISADVANTAGE

Anything that results in corporations having to pay more taxes is disadvantageous from their point of view.

3. Continuous life ⇒ ADVANTAGE

This is an advantage because it makes accounting for the company easier as well as giving investors more stability in their planning.

4. Unlimited liability of owners ⇒ NOT APPICABLE.

This is not applicable to Corporate ownership but rather to sole proprietorship.

5. Government regulation ⇒ BOTH ADVANTAGE AND DISADVANTAGE

This can be both an advantage and a disadvantage. On the one hand, it can lead to the industry functioning effectively but on the other hand, it could stifle growth with restrictive policies.

6. Separation of ownership and management ⇒ DISADVANTAGE

This is a disadvantage because it gives rise to the Agency problem where management might try to act in their own best interests instead of that of the owners.

7. Ability to acquire capital ⇒ ADVANTAGE

Corporations are better able to acquire capital which is good because it means that they will be able to invest and embark on more projects.

8. Ease of transfer of ownership ⇒ ADVANTAGE

Owners of corporations especially the public ones, are able to transfer ownership quite easily to others through the sale of shares.

6 0

2 years ago