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e-lub [12.9K]
2 years ago
5

Jordan, Inc., holds 75 percent of the outstanding stock of Paxson Corporation. Paxson currently owes Jordan $400,000 for invento

ry acquired over the past few months. In preparing consolidated financial statements, what amount of this debt should be eliminated?
a) 0
b) $100,000.
c) $300,000.
d) $400,000.
Business
1 answer:
Marat540 [252]2 years ago
4 0

Answer:

Because this is an inter-entity balance then the amount that should be eliminated of this debt is the letter D. all the $400,000.

Explanation:

Inter entity balance facilitates the management of allocations and transfers between entities. They provide a better control over transactions spanning multiple entities, other benefit is that the accuracy of the financial data improves and finally and this is why the anser is option D. is that it keeps each entity in balance

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Bill and Brenda bought their home for $150,000. They made $50,000 of improvements. They sold the home for $450,000 and paid $30,
adell [148]

Answer:

Explanation:

Capital gains tax is a tax that is levied on the profit made from the sale of a non-inventory asset. The most common sources of capital gains are through the sale of bonds, precious metals, stocks, property, and real estate.

The IRS typically allows an exclusion of up to: $250,000 of capital gains on real estate for a single person and $500,000 of capital gains on real estate for a married couple who are filing jointly.

To find the amount on which they pay capital gains:

The adjusted basis is $200,000 which is:

Initial cost of buying the house for $150,000, plus cost of improvements $50,000.

The sales price of $450,000 minus the selling expenses which cost $30,000.

The amount realized is therefore:

$450,000 - $30,000 = $420,000.

Note: They will receive an exclusion of $500,000 because they are filing jointly. So Bill and Brenda will not pay any capital gains tax.

6 0
2 years ago
Read 2 more answers
Snoke Inc's current price is $100 and the price is expected to rise to $110 in one year. The dividends are paid annually and the
postnew [5]

Answer:

Expected stock Return = 16%

Explanation:

The return of a stock is calculated by subtracting ending stock price to ending stock price and add adding and income distributions made during the period and divide by the stock price at beginning

Current stock price = $100

Expected stock price = $110

Dividends = $6

So in Snoke Inc's the only income distributions are dividends

Return = Ending stock price - Current stock price + dividends/Current stock             price

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7 0
3 years ago
The ledger of Oriole Company on July 31, 2017, includes the selected accounts below before adjusting entries have been.
Katarina [22]

Answer:

July 31                                            Dr.           Cr.

1.  Interest Receivable                 $220

   Interest Income                                        $220

2. Cost of Goods Sold                 $4,100  

   Supplies                                                    $4,100

3. Rent Expense                           $1,050

   Prepaid Rent                                             $1,050

4. Salaries and Wages Expense $3,500

   Salaries and Wages Payable                    $3.500

5. Depreciation                            $470    

   Accumulated Depreciation                       $470

6. Unearned Service Revenue   $4,850

   Serivce Revenue                                       $4,850

7.  Maintainance & repair Exp.    $2,150

    Maintainance & repair Payable               $2,150

Explanation:

1.

Interest Income from Note receivable  = $22,000 x 12% x 1/12 = 220

2.

Reduction in supllies will be adjusted in Cost of Goods Sold by $4,100 ( $22,500 - $18,400 ).

3.

Monthly rent accrues = 4,200 / 4 = $1,050

4.

Unpaid salaried are recorded as the Salaries and Wages Payable of $3,500

5.

Depreciation per month = $5,640 / 12 = $470

6.

Service revenue will b recognized and balance is transferred from unearned revenue to service revenue.

7.

Maintenance and repair costs is recorded as as the maintenance and repair payable by $2,150.

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Union dues, fees for tax return preparation, and other miscellaneous expenses are:
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Deductible for the amount that exceeds 2% of gross income
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