Complete Question:
Pribuss Engineering prepares its financial statements according to International Financial Reporting Standards. During 2018, the company incurred the following costs related to a new product design:
Research for New Design $2.4M
DVMPT of New Product $1.3M
Patent Filing Fees $52K
The development costs were incurred after technological and commercial feasibility was established and after the future economic benefits were deemed probable. The project was successfully completed and the new product was patented before the end of the 2018 fiscal year. What amount should Pribuss expense in its 2018 income statement related to the above expenditures?
Answer:
The Research expenses of $2.4M that are written as expense in the Income statement and the Development costs of $1.3M and patent legal fees of $53k are capitalized.
Explanation:
The reason is that the International Standard IAS 38 Intangible Assets says that the expenditure incurred on the research that hasn't entered development phase must be written as expense in the year and the expenditure incurred on the development phase of the research outcomes must be capitalized to the extent it is ready for use. In this case $1.3M is clearly a development cost and patent legal fees of $53k is the expenditure that will prepare the asset and making it ready for use, so it must also be capitalized.
The current market price of the bond is 103% of their par value
What percentage is the bond price compared to its par value?
The market bond convention is to quote the price at which the bond can be bought or sold in the market as a percentage of its par value.
The simple approach is to add a percentage sign to any bond price you are given, which means that 97 price means the bond price is 97% of par value.
In the same vein, 103 price means the quoted price of the bond is 103% of the par value of the bond/
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They will pay net $229,030 after paying a 7.5% commission to their broker.
<h3>What is commission?</h3>
- Commissions are a type of variable-pay compensation for provided services or sold goods.
- Commissions are a typical method of encouraging and rewarding salespeople. It is also possible to create commissions to promote particular sales behaviors.
- For instance, when offering significant discounts, commissions might be decreased.
- When you buy, you normally pay a commission, and when you sell, you typically pay another commission. Investment commissions are not regarded by the IRS as a tax-deductible item.
- Instead, the commission is included in the cost basis of the investment, giving you a small tax break.
<h3>Calculation of net payment:</h3>
= 100% - 7.5%
= 92.5%
= $247,600 x 92.5%
= $229,030
Hence, they will pay net $229,030 after paying a 7.5% commission to their broker.
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Explanation:
The journal entries are shown below:
On October 12
Purchases ($47,500 x 0.99) $47,025
To Account Payable $47,025
(Being the purchase of merchandise is recorded)
On October 12
Freight In $670
To Cash $670
(Being the freight charges is recorded)
On October 31
Account Payable $47,025
To Interest Expense $475
To Cash $47,500
(Being the payment for purchases is recorded)
Account Receivable $31,400
to Sales Revenue $31,400
(To record the sales on account)
On October 31
Cost of Goods Sold $20,550
Ending Inventory $59,145
To Beginning Inventory $32,000
To Purchases $47,025
To Freight In $670
(Being recording the adjusting entry is made)
Answer: Fixed assets are long-term items that add value to your business. They are tangible assets that you do not expect to convert into cash in less ... asset because you want to convert it into cash as fast as possible. ... You must keep up with maintenance schedules to get the longest life out of your fixed assets.
Explanation: PLEASE GIVE BRAINLIST
