All categories

3 years ago

Mr. Decker invested $20,000 in cash in his new business. How does the company record the investment?

Business

1 answer:

Rudiy273 years ago

8 0

Answer:

The company records the investment by the entry:

(D) debit Cash and credit Owner's Equity

Explanation:

Mr. Decker invested $20,000 in cash in his new business. He is the Owner of the company.

In the case, the company that he invested received cash from Mr. Decker.

The company will record the increasing in cash and increasing in Owner's Equity account by the journal entry:

Debit Cash $20,000

Credit Owner's Equity $20,000

You might be interested in

Ayayai Corp. had the following inventory transactions occur during 2022: Units Cost/unit Feb. 1, 2022 Purchase 102 $42 Mar. 14,

Dominik [7]

Answer:

Income after tax = $1666

Explanation:

LIFO (Last-In-First-Out) is a method of inventory valuation where the goods that are received last are used first. In other words, the latest stock is used first. This is common for bulky inventory, stacked one on top of another.

In order to obtain the after-tax income, both the gross profit and income before tax are required. To obtain gross profit, we require the cost of goods sold information. The inventory information is as follows:

Feb 1 : Purchases : 102 units x $42 = $4284

Mar 14 : Purchases : 175 units x $44 = $7700

May 1 : Purchases : 124 units x $46 = $5704

288 units were sold

The COGS would be:

124 x $46 = $5704

164 x $44 = $7216

Thus COGS : $5704 + $7216 = $12920

Gross profit : Sales - COGS

Sales : $59 x 288 = $16992

Gross Profit = $16992 - $12920 = $4072

Income before tax : Gross Profit - Expenses

Operating expenses : $1692

Income before tax = $4072 - $1692 = $2380

Income after tax : Income before tax - (tax rate x income before tax)

Tax rate : 30%

Income after tax = $2380 - ($2380 x 30%) = $1666

7 0

3 years ago

Punitive damages: a. are a small amount of compensation given to the plaintiff. b. are like actual damages but do not seek to de

lukranit [14]

Answer:

The correct answer is letter "D": are damages in excess of the plaintiff's injuries, awarded to punish the defendant.

Explanation:

Punitive Damages are penalties passed to the defendant of court cases on top of compensations they must pay to plaintiffs because of the faults they committed. The punitive damage is not provided to the plaintiffs but is imposed to punish defendants when their faults are negligent and should not be repeated.

Thus, <em>punish damages are imposed in an attempt to avoid other individuals to commit the same gross faults.</em>

6 0

3 years ago

Janet planned to purchase a McDonald's franchise. Meanwhile, Jason decided to open his own sandwich shop. Both decided to financ

Fantom [35]

Answer:

The correct answer is Banks view franchises as having fewer risks than other start-up businesses.

Explanation:

Franchising as an investment opportunity offers great advantages over other systems, this is an attractive alternative to develop a business; However, it will always be necessary to consider the pros and cons, before making a decision to franchise my business or not.

When I evaluate the possibility of franchising my business I have to be willing to assume a greater or lesser risk, that is, I am free to choose how much risk I am willing to accept in the development of my business model under the franchise scheme, and it is precisely this knowledge of the situation, which allows us to make the best decision about whether to expand my business (and under what conditions) or on the contrary wait for the business model to be at a more advanced stage of maturity before starting a project of franchise development.

4 0

3 years ago

Economic efficiency is defined as a market outcome in which the marginal benefit to consumers of the last unit produced is equal

nataly862011 [7]

Answer: true

Explanation:

Economic efficiency implies an economic state in which every resource is optimally allocated to serve each individual in the best way while minimizing waste and inefficiency.

7 0

3 years ago

"Shenandoah Skies" is the name of an oil painting by artist Kara Lee. In each of the following cases, determine the amount and c

masya89 [10]

Answer:

A. $6000 ordinary income on sale of a creative asset by the creator of the asset.

B. $4000 ordinary income on the sale of inventory.

C. $35000 capital gain on sale of a capital asset. (which is a non depreciable business personality).

Explanation:

The taxpayer sold a painting to Reller Gallery for $6000. So, the tax payer amount and the character of tax payer gain or loss is as follows:

A. $6000 amount realized minus zero basis is equal to $6000 ordinary income on sale of a creative asset by the creator of the asset.

Reller Gallery sold the painting purchased by from Kara to a regular customer, Lollard Inc. for $10000. So, the tax payer amount and the character of tax payer gain or loss is as follows:

B. $10000 amount realized minus $6000 cost basis is equal to $4000 ordinary income on the sale of inventory.

Lollard Inc., the tax payer, was the regular customer that purchased the painting from the Reller Gallery. Lollard showed the painting in the lobby of its corporate headquarters until it sold "Shenandoah Skies" painting to a collector from Dallas. Where the collector paid $45,000 for the painting. So, the tax payer amount and the character of tax payer gain or loss is as follows:

C. $45000 amount realized minus $10000 cost basis is equal to $35000 capital gain on sale of a capital asset. (which is a non depreciable business personality).

3 0

3 years ago

Read 2 more answers