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Assoli18 [71]
3 years ago
15

Manistee Corporation reported taxable income of $1,200,000 this year and paid federal income taxes of $408,000. Not included in

the computation was disallowed entertainment expenses of $25,000, tax-exempt interest of $20,000, and a net capital loss of $50,000 incurred this year. Manistee is an accrual basis taxpayer. The corporation’s current earnings and profits this year would be:
Business
1 answer:
lidiya [134]3 years ago
7 0

Answer:

$737,000

Explanation:

The computation of the current earnings and profits this year is shown below:

= Taxable income - federal income tax paid -  disallowed entertainment expenses + tax-exempt interest - net capital loss

= $1,200,000 - $408,000 - $25,000 + $20,000 - $50,000

= $737,000

Since we add the exempted interest and deduct all other expenses, losses, and taxes to the taxable income so that accurate value can come

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A company received $11,000 cash in exchange for 200 shares of the company’s common stock. What would the effect of this transact
MAVERICK [17]

Answer:

B. $11,000 increase in Assets; No effect on Liabilities; $11,000 increase in Stockholders’ Equity

Explanation:

As the company received cash in exchange for the common stock. So, it affect the accounting equation which is shown below:

Total Assets = Total liabilities + Total  stockholder equity

The journal entry is shown below for better understanding:

Cash A/c Dr XXXXX

     To Common stock XXXXX

     To Additional Paid-in capital - in excess of  par XXXXX

(Being cash is received)

So, it would not impact the total liabilities

7 0
2 years ago
In the month of June, Bedford Company sold 350 widgets. The average sales price was $34. During the month, fixed costs were $6,3
VikaD [51]

Answer:

Results are below.

Explanation:

Giving the following information:

In June, Bedford Company sold 350 widgets. The average sales price was $34. During the month, fixed costs were $6,320 and variable costs were 40% of sales.

F<u>irst, we need to calculate the unitary variable cost:</u>

Unitary variable cost= 34*0.4= $13.6

<u>Now, we can determine the contribution margin per unit and the contribution margin ratio:</u>

contribution margin per unit= selling price - unitary variable cost

contribution margin per unit= 34 - 13.6= $20.4

contribution margin ratio= contribution margin per unit/selling price

contribution margin ratio= 20.4/34

contribution margin ratio= 0.6

<u>To calculate the break-even point in units and dollars, we need to use the following formula:</u>

Break-even point in units= fixed costs/ contribution margin per unit

Break-even point in units= 6,320/20.4

Break-even point in units= 310 units

Break-even point (dollars)= fixed costs/ contribution margin ratio

Break-even point (dollars)= 6,320/0.6

Break-even point (dollars)= $10,533

<u>To calculate the margin of safety, we will use the following formula:</u>

Margin of safety= (current sales level - break-even point)

Margin of safety= 350*34 - 10,533

Margin of safety= $1,367

<u>Finally, the desired profit is $4,000:</u>

Break-even point in units= (fixed costs + desired profit) / contribution margin per unit

Break-even point in units=  (6,320 + 4,000) / 20.4

Break-even point in units= 506 units

Break-even point (dollars)= (fixed costs + desired profit)/ contribution margin ratio

Break-even point (dollars)= 10,320/0.6

Break-even point (dollars)= $17,200

3 0
3 years ago
Nevin is a longtime teacher supervising a group of very eager, very dedicated teach for america volunteers who are excited about
vodka [1.7K]
The correct answer is "People-Oriented Leadership".

People-Oriented leadership refers to the kind of leadership, wherein a leader takes initiative and also believes that communication from one worker to another can be a good cause for effective teamwork. Nevin believes that social interaction can be a good cause for unity and a harmonious workplace to achieve goals easily.
6 0
3 years ago
Read 2 more answers
Cosi Company uses a job order costing system and allocates its overhead on the basis of direct labor costs. Cosi expects to incu
fenix001 [56]

Answer:

156.6%

Explanation:

Given:

Cosi Company's Incurred over head for the next period = $830,000

Expected labor hours = 53,000

Cost of labor = $10.00 per hour

Thus,

Total labor cost = 53,000 × $10.00 = $530,000

Now,

the Cosi Company's predetermined overhead rate will be calculated as:

Predetermined overhead rate =  Incurred overhead / Total labor cost

on substituting the respective values, we get

Predetermined overhead rate = ( $830,000 / 530,000 ) = 1.566

or

Predetermined overhead rate = 1.566 × 100% = 156.6%

4 0
3 years ago
A sunk cost: Requires a current outlay of cash. Is the lost benefit of choosing an alternative course of action. Is irrelevant i
igor_vitrenko [27]

Answer:

Is irrelevant in decision making

Explanation:

Since the suck cost is the cost that no longer is recovered so it should not be a factor to consider when making a decision. For example, you have bought a cinema ticket for this evening, but it is heavily rainy so you may get sick if you go to the cinema. The fact that you have paid for this ticket should not consider whether to go or stay home since you can not get this amount of money no matter what happens.

5 0
3 years ago
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