If this is a multiple choice the answer is the option about the tree branch breaking your bedroom window...hope this helps:)
Answer:
Rate of return on investment = 79.87% Loss
Explanation:
Given:
Sale price = $97,843.75
Face value = $100,000
Initial margin = $2,700
Computation:
Loss on sale = Face value - Sale price
Loss on sale = $100,000 - $97,843.75
Loss on sale = $2,156.5
Computation:
Rate of return on investment = ($2,156.5 / $2,700)100
Rate of return on investment = 79.87% Loss
Answer:
a)Jada's basis for depreciation in the property is NIL.
b) Personal property that has no intrinsic value is called 'INTANGIBLE PROPERTY'.
Explanation:
Due to a decline in the property values over the past few years Jada has converted her personal residence to rental property and/or investment property which is a subject dealt within IAS 40 (Investment property).
According to IAS 40 an investment property is land or building held to earn rentals or for capital appreciation or both rather than use in the entity. IAS 40 requires to initially measure investment property at cost and subsequently may either measure at cost or fair value model. Fair value is normally established by prevailing market prices.
IAS 40 also mentions that if an asset is revalued to fair value the gain and loss should be recorded in statement of profit and loss and 'NO DEPRECIATION IS CHARGED ON THE ASSET AFTER THE FAIR VALUE MEASUREMENT'.
Therefore, following the instructions laid out by IAS 40 Jada's basis for depreciation in the property is NIL.
2) Personal property with no intrinsic value:
Personal property that has no intrinsic value is called 'INTANGIBLE PROPERTY'.
Lets first understand what intrinsic value is. Intrinsic value of an asset refers to the market led and/or market-driven price of that asset. This means those assets which don't have an active market for sale and purchase will have no intrinsic value. This is absolutely the case with intangible assets, because most intangible assets are unique and uncommon, such as, GOODWILL, PATENTS, COPYRIGHTS, therefore due to the uniqueness and exclusivity of such assets an active market place doesn't exist therefore it's hard to determine an intrinsic value for such kind of assets/ properties.
Answer:
IV
YES
Explanation:
Accounting profit= total revenue - explicit cost
Total revenue =price x quantity sold
Explicit cost includes the amount expended in running the business.
They include rent , salary and cost of raw materials
Economic profit = accounting profit - implicit cost
Implicit cost is the cost of the next best option forgone when one alternative is chosen over other alternatives
economic profit includes the opportunity cost of funds
In some industries, only normal profit is earned in the short run. For example, in a perfect competition and monopolistic competition, only normal profit is earned in the long run due to free entry and exit of firms in the industry. thus if only normal profit would be earned, the company should still go ahead and establish
Answer:
A debit to Unearned Rent and a credit to Rent Revenue for $3,675.
Explanation:
The year end adjusting entry is as follows
Unearned rent Dr $3,675
To Rent earned $3,675
(Being the unearned rent is recorded)
The computation is shown below:
= Monthly rate × number of months
= $1,225 × 3 months
= $3,675
The three months is calculated from October 1 to December 31 and the same is to be considered
