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Sidana [21]
1 year ago
12

steven operates a landscaping service on the accrual method. in september of this year, steven received a payment of $18,000 for

24 months of landscape services ($750 per month commencing on november 1st of this year). when must steven recognize the income if his accounting methods are selected to minimize income recognition?
Business
1 answer:
r-ruslan [8.4K]1 year ago
7 0

If steven received a payment of $18,000 for 24 months of landscape services ($750 per month commencing on november 1st of this year). if his accounting methods are selected to minimize income recognition is : A. $1,500 is recognized in this year, $16,500 next year.

<h3>Determining the recognized income</h3>

Since we were told that he received payment of the amount of $18,000 and as well received  the amount of $750 per months  starting from November 1 now let determine his recognized amount.

Recognized amount this year:

Recognized amount this year = Amount received in November × 2 months

Recognized amount this year = $750 × 2 months

Recognized amount this year = $1,500

Recognized amount  next year:

Recognized amount next year  = Amount received in September -  Recognized amount in November

Recognized amount next year  = $18,000 - $1,500

Recognized amount  year = $16,500

Therefore the correct option is A..

Learn more about recognized amount here: brainly.com/question/26275324

#SPJ1

The complete question is:

Steven operates a landscaping service on the accrual method. In September of this year Steven received a payment of $18,000 for 24 months of landscape services ($750 per month commencing on November 1st of this year). When must Steven recognize the income if his accounting methods are selected to minimize income recognition?

A. $1,500 is recognized in this year, $16,500 next year.

B. $1,500 is recognized this year, $9,000 next year, and $7,500 in the last year or the contract

C. $18,000 is recognized this year

D. $9,000 is recognized this year and $9,000 next year

E. $18,000 is recognized in the last year of the contract

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Answer:

expected bankruptcy costs =  $190000

Explanation:

given data

face value = $4 million

equity = $18.6 million

stock outstanding = 510000 shares

sell price = $31 per share

corporate tax rate = 35 percent

to find out

decrease in the value of the company due to expected bankruptcy costs

solution

we get here value of levered firmed by M & M proportion

value of levered firm = value of equity + value of debit

value of levered firm = $18.6 million + 35% ( $4 million)

value of levered firm = $20 million

and

now we get total market value of firm that is

total market value of firm = market value of equity + market value of debit

total market value of firm = $31 ( 510000 ) +  $4 million

total market value of firm = $19810000

so expected bankruptcy costs are here as

expected bankruptcy costs =  $20 million - $19810000

expected bankruptcy costs =  $190000

7 0
3 years ago
To become industrial, a nation must have raw materials, workers, and capital. True or false?
saul85 [17]
To become industrial, a nation must have raw materials, workers and capital is absolutely true. Without any of the things mentioned, it is impossible to become an industrial nation. The raw materials are required to produce the finished product. The workers are the ones that work in industries to produce the finished proudest from the raw materials. It can be physical as well as mental labor. Capital is required to buy raw materials and labor for getting the finished product and make profit.


7 0
3 years ago
Hunt Incorporated sold $209,000 of accounts receivable to Gannon Factors Inc. on a with recourse basis. Gannon assesses a 2% fin
pentagon [3]

Answer:

Dr Cash $190,190

Dr Due from Gannon Factors $14,630

Dr Loss on Sale of Receivables $16,280

Cr Accounts Receivable $209,000

Cr Recourse Liability $12,100

Dr Accounts Receivables $209,000

Cr Due to Customer $14,630

Cr Interest Revenue $4,180

Cr Cash $190,190

Explanation:

Journal entries

Dr Cash $190,190

Dr Due from Gannon Factors $14,630

Dr Loss on Sale of Receivables $16,280

Cr Accounts Receivable $209,000

Cr Recourse Liability $12,100

Dr Accounts Receivables $209,000

Cr Due to Customer $14,630

Cr Interest Revenue $4,180

Cr Cash $190,190

*7% X $209,000 =$14,630

*2% X $209,000 =$4,180+$12,100=$16,280

5 0
3 years ago
Bruce has a credit card that uses the average daily balance method. For the first 9 days of one of his billing cycles, his balan
Mice21 [21]

Answer:

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In order to determine the amount of interest charged you must first calculate the average daily balance:

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Now we must calculate the daily interest rate:

daily interest rate = 23% / 365 = 0.063%

Finally we multiply the average daily balance times the daily interest rate times the number of days in the billing period:

interest charged = $1,618.39 x 0.063% x 31 days = $31.61

3 0
3 years ago
When an electronics company sells its global positioning systems to a car manufacturer, it is engaged in ________ marketing.
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Answer:

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The <u>opposite of B2B is B2C (Business to Consumer) marketing, this is the commonly known type of marketing where a consumer/individual</u> patronizes the products of a manufacturer or business organisation.

B2B will usually occur when a company needs certain products or materials to complete its own finished goods and this can be purchased from another organisation that has been adjudged to be a producer of same.

It could also occur, when a business is required to take on the services of another business for instance in audit cases.

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5 0
3 years ago
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