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3 years ago

Smith & Jones, Accountants, agrees to perform an audit for Brick & Mortar Stores, Inc.

Business

1 answer:

makvit [3.9K]3 years ago

3 0

Answer:

a. want to avoid potential disputes.

Explanation:

The auditors are liable to report all the acts of the company, whether are in confirmation of law or not. This is because it is their duty to put a review on the balance sheet, and provide the users of such balance sheet the trust on the information presented.

Even if the agreement do not provide for complete details making it a valid contract this is sure that they need to act properly so that any moral dispute do not occur and that, all the work is done according to the responsibilities.

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At the beginning of Year 2, the company repurchased and retired 1,100 shares at $8.10 per share. Prepare the appropriate journal

Tema [17]

Answer:

Explanation:

We have two journal entries to be able record the repurchase and retirement of the shares

First journal to record the share repurchased

Dr Treasury stock 8,910

Cr Cash 8,910

While the second journal is to record the retirement of share repurchased:

Dr Common stock 1,100

Dr Paid-in capital common stock 2,310

Dr Retained Earning 5,500

Cr Treasury stock 8,910

To record the share repurchased:

The Treasury stock account is debited with the amount that is equals to cash paid for stock that is been repurchased, therefore, offsetting entry is credit Cash account = Number of share repurchased multiply Price purchase

= 1,100 * 8.1

= $8,910

Also, to record the retirement of share repurchased:

The common stock account is been debited at the amount = Par value multiply by Share retired

= 1 * 1,100

= $1,100

As one common stock is carried $2.1 value excess of par ( which is calculated as 168,210 / 80,100); paid-in capital account is debited by $2,310 ( 1,100 * 2.1)

The retained earning is been debited by the amount is calculated as follows,;

Number of share retired multiply by ( Price at retired - Par value - Excess of par value) = 1,100 * ( 8.1 -1-2.1) = $5,500

Treasury account is debited $8,910 to bring the balance of this account to zero as stocks repurchased are fully retired.

5 0

3 years ago

Kamath-Meier Corporation's CFO uses this equation, which was developed by regressing inventories on sales over the past 5 years,

charle [14.2K]

Answer:

$71.5

Explanation:

Inventory forecast is a way of predicting the volume of inventory required to fulfill future orders based on the existing production capacity and other plans relating to production

equation for forecasting inventory = $22 + 0.125 sales

Current sales = $300 million

Annual sales growth rate =32%

sales for next year = 300 + (300*32%)

300 + 96= $396 million

Applying the equation

Inventory = $22 + (0.125*396)

$22 + $49.5 = $71.5 million

7 0

3 years ago

what is the present value of the following cash-flow stream if the interest rate is 6%? note: do not round intermediate calculat

Anettt [7]

The present value of the cash-flow stream if the interest rate is 6% is $323.03.

<h3>What is the interest rate?</h3>

The interest rate can be defined as the amount or the percentage that is being fixed or fluctuating depending upon the condition of the agreement. The interest is calculated on the amount that is being loaned or given to the individual or a company.

According to the given question, the interest rate is 6%

1st year $120

2nd year $320

3rd year $220

Now, by applying the formula for the present value:

$\rmPV = \dfrac{fv}{(1 + r)^t}$