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Anastaziya [24]
3 years ago
9

Prince Company acquires Duchess, Inc. on January 1, 2016. At the date of acquisition, Duchess has long-term debt with a fair val

ue of $1,500,000 and a carrying amount of $1,200,000.
With respect to long-term debt consolidation worksheet adjustments in periods following the acquisition, which of the following is correct:

Multiple Choice:

Debit Interest Expense and Credit Long-Term Debt Expense.

Prince must recognize an increase in interest expense if the amount is material.

Do not adjust the value of the debt because Prince is not obligated to repay the debt.

Credit Long-Term Debt and Debit Interest Expense on the balance sheet of Duchess.

Debit Long-Term Debt and Credit Interest Expense.
Business
1 answer:
vlabodo [156]3 years ago
5 0

Answer:

Debit Interest Expense and Credit Long-term Debt Expense.

Explanation:

When Price is acquiring the Duchess Incorporation, it is agreeing upon everything that the Duchess is liable to pay and and receive from any other party. Duchess has a long term debt with a fair value of $1500000, which needs to be paid by the acquiring company now i.e. Prince. Hence, the interest expense would be paid and the long-term debt expense would be decreased by the same amount.

Therefore, for that the entries would be as follows:

                                                     Debit             Credit

Interest Expense                           $xxx

Long-term debt expense                                    $xxx

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Answer:

The correct answer is letter "C": Every January, the stock market earns above-normal returns.

Explanation:

Inside the Efficient Market Hypothesis or EMH, we can find the term "weak from efficiency" that states past price action do not influence the current stock price or it is not useful in order to predict future price movements. According to the same concept, the use of technical analysis or the suggestions of financial advisers is useless.

In that sense, option letter "C" indicates that <em>every January the stock market earns an above-normal return</em>, which clearly reflects that there is a repeated pattern in the stocks affecting their price during that specific month, something impossible to take place according to what "weak from efficiency" establishes.

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2 years ago
Lacey Company prepared the tabulation below at December 31, 2022. Net Income $310,000
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Answer:

Net cash provided by operating activities is $325,000.

Explanation:

Lacey Company

Cash Flow Statement (Operating Activities Only)

December 31, 2022.

<u>Details                                                                       Amount ($)</u>

Net Income                                                                   310,000

Depreciation expense                                                  45,000

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Decrease in inventory                                                   12,000

Increase in accounts payable                                        6,000

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Decrease in income taxes payable                               3,500

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Net cash provided (used) by operating activities  <u> 325,000 </u>

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ladessa [460]

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Peggy made an offer to sell the dog for $800, they didn't discuss the dog's ancestry and Shelby wrongly assumed the dog was from champion lines and agreed to buy the dog for $800.

Based on further investigations, she discovered the dog was worth just $200.

She cannot rescind the contract because she wrongly assumed the dog's value not an error about à material fact. Peggy sold the dog at her own rates and Shelby bought the dog while wrongly assuming the value, so she cannot cancel the contract based on that.

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Answer:

hi im just getting my points

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and im good btw

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