The correct option is A
<u>Explanation:</u>
Under the accrual basis of an accounting system, an expense has to be booked in the period in which it is incurred whether such an expense has been paid or not.
<u>The following Journal Entry will be passed in the books of accounts of a company:
</u>
Wages account will be debited with an amount of 5000 and Wages Payable account will be credited with an amount of 50000
Thus, the correct answer will be option A from the given options.
Answer:
The distribution by Fargo corporations has the following tax consequences
- The corporation has distributed an appreciated property( that on its own makes it liable for tax)
- The corporation must recognize the gains or losses made on the distribution as if the corporation was selling the property to the shareholder.
- Apply capital gains tax on the gains or losses
- capital gain = $310000-$260000 =$50000
- Apply any annual exclusion and multiply by the Capital Gains Tax to arrive at Taxable Capital Gain to be included in incomes
The shareholder will recognize dividend received in the market value and will be subject to exemptions if applicable.
Explanation:
First of all, let us calculate the annual gains: they are 80000-60000=20000$. In three years, the profit will be 3*20000=60000$. Hence, the break-even investment would be 60000$. For a year after that, the profit will be 20000$; hence the return on investment would be 20000/60000=33,33% per year. After 6 years, the investment would have yielded a 100% profit (return on investment).
