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4 years ago

The direct write off is used when:

Business

1 answer:

Thepotemich [5.8K]4 years ago

3 0

Answer:

The correct answer is letter "A": Uncollectible accounts are not anticipated or immaterial.

Explanation:

Direct write-off is a method used to record debts from credit sales. An allowance account is not used with this method but an account receivable directly written-off for the outstanding amount once it is determined to be uncollectible. This method is used for tax-reporting purposes.

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McLin, Inc., is a calendar year S corporation. Its AAA balance is zero. Determine the tax aspects of the following transactions.

S_A_V [24]

Answer:

$10,000

Explanation:

Given that:

McLin holds $90,000 of AEP, this implies what is salary is made of;

Tobias, the sole shareholder, has an adjusted basis of $80,000 in his stock.

Tobias is paid a $90,000 salary income.

Ignore the 20% QBID

We are to determine the tax aspects of the transactions

Since the company receives a $90000 for salary expense. Thus Tobias basis is zero, then :

The tax aspect of the transaction is : ($90000 - $80000)

The tax aspect of the transaction = $10,000

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3 years ago

Gross Inc. signs a five-year licensing agreement with Maiger Company. Gross Inc. will pay Maiger annual installment payments of

olganol [36]

Answer:

$4,500

Explanation:

First, calculate the total Installment

Total Installment payment = Annual Installment x Numbers of annual

Where

Annual Installment = $10,500 per year

Numbers of annual = 5 years

Installment payment = $10,500 per year x 5 years

Installment payment = $52,500

Now use the following formula to calculate the Interest payent

Interest payment = Installment Payment - Fair value of contract

Where

Installment Payment = $52,500

Fair value of contract = $48,000

Placing values in the formula

Interest payment = $52,500 - $48,000

Interest payment = $4,500

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3 years ago

What are the three questions you need to ask yourself before you start investing

Leto [7]

Explanation:

Is the seller licensed?

Is the investment registered?

How do the risks compare with the potential rewards?

Do you understand the investment?

6 0

3 years ago

"You are in the middle of a discussion with an institutional client over the phone, where you recommend that the client buy 100,

docker41 [41]

Answer:

The colleague has committed a violation because your customer's order could move the price of ABC stock

Explanation:

Front running is also called tailgating. It is a prohibited practice where a trader enters into a position security based on non-public information about a large trade that will influence the price of the security.

The trade is initiated to take advantage of the new price that the large trade will cause. The position is entered before the large trade occurs.

In this scenario your neighbour heard you telling your client to but 100,000 share of ABC. Because the transaction will influence the market he also tells his client to buy 10,000.

This is tailgating and it is a violation.

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3 years ago

Howard Inc. had prepaid rent of $94,000 and $105,000 at the end of 2017 and 2018, respectively. During 2018, Howard recorded $25

Paladinen [302]

Answer:

The outflow of cash in respect of rent is $270,000

Explanation:

The task is compute cash outflows on rent in the year 2018.

The prepaid rent at the end of 2017 relates to rent expense but was paid last year hence should be deducted from rent expense in the year,

On the other hand , the prepaid expense for 2018 was paid during the year hence should be added to rent expense in order to cash cash outflow relating to rent expense

Rent expense $259,000

Prepaid rent 2017 ($94,000)

prepaid rent 2018 $105,000

Cash paid in 2018 $270,000

Ultimately the outflow of cash in respect of rent in the year is $270,000

4 0

3 years ago