1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Naddik [55]
3 years ago
11

Marigold Company owns equipment that cost $936,000 and has accumulated depreciation of $395,200. The expected future net cash fl

ows from the use of the asset are expected to be $520,000. The fair value of the equipment is $416,000. Prepare the journal entry, if any, to record the impairment loss.
Business
1 answer:
DanielleElmas [232]3 years ago
3 0

Answer:

Dr Impairment expense (p/l)   $20,800

Cr Accumulated depreciation   $20,800

Being entries to recognize the impairment of asset.

Explanation:

An asset is said to be impaired when the carrying amount is higher than the recoverable amount. The recoverable amount is the higher of the value in use (the expected future net cash flows from the use of the asset) and the  fair value less cost to sell.

Given;

Cost = $936,000

Accumulated depreciation = $395,200

Carrying amount = $936,000 - $395,200

= $540,800

The recoverable amount is the expected future net cash flows from the use of the asset $520,000 as this is higher than the fair value of the equipment which is $416,000.

Since the carrying amount is higher than the recoverable amount, the asset is impaired.

Impairment = $540,800 - $520,000

= $20,800

The journal entries,

Dr Impairment expense (p/l)   $20,800

Cr Accumulated depreciation   $20,800

Being entries to recognize the impairment of asset.

You might be interested in
When previously declared cash dividends on common stock are paid which account would the corporation debit?
garri49 [273]

Answer:

C.

Explanation:

Financial Statements depicts the financial position of a firm at a particular point of time or specified date. The users of financial statements use various types of analysis to understand or compare the current financial statements of the company to prior years or with those of the competitors.

The journal entry on declaration of dividend would lead to a debit to retained earnings and credit to dividends payable.

No journal entry is passed on the date of recording dividend.

Later, on the date of payment of dividend would lead to a debit to dividends payable and credit to cash account.

The journal entries have been shown below:

4 0
3 years ago
According to the classification system for global organizational culture as developed by Hofstede, the degree to which employees
rusak2 [61]

Answer:

Uncertainty Avoidance

Explanation:

The term uncertainty avoidance was coined by a man named, Geert Hofstede to explain the extent to which people are willing to remain in a given situation so as to <em>avoid uncomfortable circumstances</em><em>.</em> It reflects the extent to which people are unwilling to take risks. A low uncertainty avoidance index simply means that the people who have just been studied are willing to accommodate ambiguity and take risks. A high uncertainty avoidance on the other hand means that the people are more comfortable in their given positions and are unwilling to take risks.  

So, in the employee situation, the degree to which employees are threatened by ambiguity is known as uncertainty avoidance.

3 0
3 years ago
How does a deductible affect insurance?
Alex73 [517]

The deductible is the amount a person must pay before their insurance will start to pay. For instance, say you have a $1,000 deductible on your car and you have a wreck that causes $3,000 worth of damage. the driver would have to pay the $1,000 first and then the insurance will help cover the other $2,000 at the rate the policy stipulates.

As for pricing, the insurance policies with higher deductibles (meaning the subscriber pays more for losses), the insurance premium would be cheaper than those policies with a smaller deductible.

6 0
2 years ago
In the short run, if average variable cost equals $50, average total cost equals $75, and output equals 100, the total fixed cos
musickatia [10]

Answer: $2500

Explanation:

From the question,

Average variable cost(AVC) = $50

Average total cost (ATC) = $75

Output (Q) = 100

Since Average fixed cost is the difference between the average total cost and the average Variable cost. This will be:

AFC = ATC - AVC

AFC = $75 - $50

AFC = $25

We should note that:

AFC = TFC / Q

TFC = AFC × Q

TFC = $25 × 100

TFC = $2500

Therefore, total fixed cost is $2500

5 0
3 years ago
Rutgers Industries has the following inventory information for 2019: Jan 1 Beginning Inventory 240 units at $100 per unit June 1
timofeeve [1]

Answer:

$86,000

Explanation:

FIFO means first in, first out. It means that the first purchased inventory is the first to be sold.

This means thay the 500 units sold would be taken from the earliest purchased inventory and the ending inventory would be the most recently purchased inventories.

Ending inventory = (80 × $150) + (370 × $200) = $12,000 + $74,000 = $86,000

I hope my answer helps you

4 0
3 years ago
Other questions:
  • On September 1, Home Store sells a mower (that costs $240) for $540 cash with a one-year warranty that covers parts. Warranty ex
    9·1 answer
  • Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. The company has two manufacturin
    11·1 answer
  • For each example of a reward, identify whether it is an extrinsic or intrinsic reward.1)The employees were happy with the new la
    6·1 answer
  • Which of the following statements is FALSE?A. Financial ratios help compare over time companies of different sizes and industrie
    11·1 answer
  • Can someone be my friend?
    14·2 answers
  • A company makes a credit sale of $750 on June 13, terms 2/10, n/30, on which it grants a return of $50 on June 16. What amount i
    11·1 answer
  • 2019,Do you think leadership style is fixed and unchangeable, or can leaders be flexible and adaptable with respect to style? Wh
    9·1 answer
  • How can questionnaires be distributed to potential respondents?
    11·1 answer
  • Sheridan Company had these transactions during the current period. June 12 Issued 84,000 shares of $1 par value common stock for
    15·2 answers
  • What are the answers to the management quiz 13,14,15, and 16
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!