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Korvikt [17]
2 years ago
6

Jeremy operates a business as a sole proprietorship. The proprietorship uses the cash method of accounting. He decides to incorp

orate and transfers the assets and liabilities of the sole proprietorship to the newly formed corporation in exchange for its stock. The​ assets, which include​ $10,000 of accounts receivable with a zero​ basis, have a basis of​ $20,000 and an FMV of​ $40,000. The liabilities include accounts payable of​ $12,000, which will be deductible when​ paid, and a note payable on medical equipment of​ $7,000. Jeremy's basis for his stock is
Business
1 answer:
ollegr [7]2 years ago
8 0

Answer:

$13,000

Explanation:

Given that:

Jeremy operates a business as a sole proprietorship which uses a cash method of accounting. Now he is planning transfer them into a new corporation in  exchange for its stock.

The assets are :

$10,000 of accounts receivable with a zero​ basis

have a basis of​ $20,000  and an FMV of​ $40,000

Liabilities

payable of $12,000

The note payable on medical equipment is​ $7,000.

Therefore , Jeremy's basis for his stock is : $20,000 -$7,000 = $13,000

since  that will reduce the  basis by amount of the note payable.

The liabilities payable will be deducted and taken care of by the corporation.

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The answer would be C
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What is the range for the relative price of cloth such that the economy produces both cloth and food? From _______ to _______ .
dezoksy [38]

The answer is explained in detail below

Explanation:

a_{KC} = 2

a_{LC} = 2

a_{KF} = 3

a_{LF} = 1

Labor, L = 2000; Capital, K = 3000  

Labour constraint,

2Q_{c} + Q_{F} \leq 2000

Capital constraint ,

2Q_{c} + 3Q_{F} \leq 3000  

Solving the equation further, we get

Q_{F} \leq 2000 - 2Q_{C}

Q_{F} \leq 1000 - \frac{2}{3} Q_{C}

  • The range for the relative price of cloth such that the economy produces both cloth and food is  2/3 and 2
  • Low cloth production → economy will use relatively more labor to  produce cloth → opportunity cost of cloth is 2/3rd units of food.
  • High cloth  production → economy dips on labor → taking capital away from food  production → raising opportunity cost of cloth to 2 units of food.  
  • If relative price of cloth lies between 2/3 and  2 units of food, the economy  produces both goods.
  • If the price of cloth decreases below 2/3 → complete  specialization in food production → low compensation for producing cloth
  • If the price of cloth  rises above 2 → complete specialization in cloth production → low compensation for producing  food
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3 years ago
The market used to calculate the CPI is 3 units of pork and 4 unit of corn. In 2005, pork cost $20 per pound and corn cost $12 p
Ede4ka [16]

Answer:

<em>The answer will be 136.11 </em>

Explanation:

Because since the cost of the basket in 2005 is = (3x20) + (4 x 12) = 108; And the cost of basket in 2006 is = (3x25) + (4 x 18) = 147

To calculate the CPI,

  • <em>Put a sampling of product prices from a previous year. </em>
  • <em>Then, put the current prices of the same items together. </em>
  • <em>Divide the current total prices by the old prices and then subtract the sum by 100.</em>

The Consumer Price Index (CPI) for 2006 = <em>(147/108) x 100 = 136.11</em>

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Explanation:

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