Answer:
B) The State Disability Insurance (SDI) program benefits received for a period of disability are not taxable as income, but benefits received for time off under the Paid Family Leave program are federally taxable as income.
Explanation:
Disability insurance benefits are not reported for tax purposes with one exception. If a person are receiving unemployment insurance benefits,
become unable to work due to a disability, and begin receiving disability insurance benefits, your disability insurance benefits are considered a substitution for your unemployment insurance benefits, and will then be reported for tax purposes.
If disability insurance benefits are reported, a notice will accompany the first benefit payment sent to you advising that the benefits are being reported to the Internal Revenue Service. The employment development department will provide you with a 1099G tax form in January showing the reported amounts paid and forward a copy to the Internal Revenue Service.
Paid family leave benefits are reported for federal purposes but not state tax purposes.
Paid family leave benefits are not taxable or reported to the California State Franchise Tax Board.
Answer:
B) the other firm does not view the announcement as credible
Explanation:
The reason is that the other firm thinks that the announcing firm will make losses as it will not be able to sell the products in an imperfect market where both the firms have identical cost functions and knew all about the cost. So increasing the production when the demand is the same will decrease the price of the product and result in increased losses to the announcing company.
Answer: The correct answer is "b) the lessor records a receivable for the present value of lease payments.".
Explanation: In an operating lease <u>the lessor records a receivable for the present value of lease payments.</u>
In this case, only the lessor must register its credit with the lessee because the operating leases are determined as financing outside the balance sheet, therefore a leased asset and associated liabilities of future rental payments should not be presented in the general balance of a company, with the objective of keeping the debt to capital ratio low.
Answer:
WACC is 7.24%
After tax cost of debt is 3.95%
Explanation:
WACC=Ke*E/V+Kd*D/V*(1-t)+Kp*P/V
Ke is the cost of equity of 9% or 0.09
Kd is the cost of debt at 5% or 0.05
Kp is the of preferred stock of 4% or 0.04
E is the weight of equity of 65% 0r 0.65
D is the weight of debt of 25% 0.25
K is the weight of preferred stock of 10% or 0.10
t is the tax rate of 21% or 0.21
WACC=(0.09*0.65)+(0.05*0.25*1-0.21)+(0.04*0.10)
WACC=(0.09*0.65)+(0.05*0.25*0.79)+(0.04*0.10)
WACC=7.24%
after tax cost of debt=pretax cost of debt*(1-t)
=0.05*(1-0.21)
=0.0395=3.95%
Answer:
Flexible budget cost variance= $6,400 unfavorable
Explanation:
<u>To calculate the flexible budget cost variance, we need to use the following formula:</u>
Flexible budget cost variance= (standard costs*actual quantity) - actual costs
Flexible budget cost variance= (6*27,500) - 171,400
Flexible budget cost variance= 165,000 - 171,400
Flexible budget cost variance= $6,400 unfavorable
