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Korvikt [17]
3 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]3 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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xeze [42]

Answer:

Perfectly Inelastic

Explanation:

Demand can be defined as the total quantity of a commodity which a consumer is willing and able to buy at a particular time and price.

There are several types of elasticity of demand a perfectly elastic demand is one that quantity remains the same regardless of a change in price

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3 years ago
How can you price your product or service at its worth or even more? You can price your product or service at its worth or even
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You can price your products, by average, fairness is key!
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2 years ago
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A flower shop acquired 80 new customers last year. Costs in the marketing and sales areas were the following:
Anna11 [10]

Answer:

$1,215 per customer

Explanation:

Add all costs:

Marketing Costs = $1,200

Sales Costs = $9,000

Salaries = $87,000

Total = $97,200

$97,200 divided by 80 new customers = $1,215 per customer

6 0
2 years ago
Suppose two cities are considering tearing down their stadiums to build new ones. In one city, the old stadium cost $5 million t
timofeeve [1]

Answer:

These are the options for the question:

A. They should be more willing to tear down the $5 million stadium, because it cost less to build.

B. They should be more willing to tear down the $50 million stadium, because it cost more to build.

C. The cost to build the old stadium shouldn’t be considered.

And this is the correct answer:

A. They should be more willing to tear down the $5 million stadium, because it cost less to build.

Explanation:

City A will likely be more willing to tear down its old stadium because it costed $5 million to build. City B, on the other hand, will have to think twice because a stadium that costed $50 billion to build could have more value than it seems, or the City could simply not have enough money to build a better new stadium (something that would probably cost more than $50 billion to do).

4 0
3 years ago
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Micron owns 35% of Martok. Martok pays a total of $47,000 in cash dividends for the period. Micron's entry to record the dividen
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Answer:

1. Option (A) is correct.

2. Option (C) is correct.

Explanation:

1. Micron's entry to record the dividend transaction is as follows:

Cash A/c      Dr. $16,450

To Long - Term Investments  $16,450

(In this case, since the holding interest is more than 20%, Equity method is used)

workings:

Dividend = $47,000 × 35%

               = $16,450

2. The entry to record the receipt of dividend would be:

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To Dividend Revenue A/c   $12,000

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Workings:

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4 0
3 years ago
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