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Flura [38]
3 years ago
15

Marks Consulting purchased equipment costing $45,000 on January 1, Year 1. The equipment is estimated to have a salvage value of

$5,000 and an estimated useful life of 8 years. Straight-line depreciation is used. If the equipment is sold on July 1, Year 5 for $20,000, the journal entry to record the sale will include a:
Business
1 answer:
ANTONII [103]3 years ago
7 0

Answer:

The journal entry to record the sale will be:

Debit Cash (sales proceed)                  $20,000

Debit Loss on disposal                           $2,500

Debit Accumulated depreciation         $22,500

Credit Equipment cost                          $45,000

<em>(To record disposal of an equipment)</em>

Explanation:

Straight-line depreciation method is allocating the cost of an asset on a uniform basis over its useful life. The formula for this method of depreciation is: (Cost - Salvage value) / Useful life

Depreciation = ($45,000 - $5,000) / 8 years

Depreciation = $5,000 yearly

On July 1, Year 5, acummulated depreciation will be 4.5 years x $5,000 = $22,500.

Net book value of the equipment on July 1, year 5, is $22,500 ($45,000 - $22,500). When compared with the sales proceed, loss on disposal will be $2,500 ($22,500 - $20,000). The required journals were as provided above.

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Answer:

a. In a situation where prices are declining, companies using LIFO will report the smallest cost of goods sold.

Explanation:

The last in first out method (LIFO) generally results in less net income because Cost of Goods Sold is greater. The reason is that normally prices increase with time due to inflation.

However, the opposite is true when prices are falling, LIFO will report the smallest cost of goods sold.

<u>The reason is the last items are assumed to be sold first, hence the figure of cost of goods sold will be smaller since the costs are smaller compared to the stock bought previously which are more expensive. </u>

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3 years ago
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Which of the following orders is most useful to short sellers who want to limit their potential losses? A. Limit order B. Discre
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According to the leadership grid developed by Blake and Mouton, which management style reflects moderate concern for production
sergiy2304 [10]

Answer:

Middle-of-the-road management

Explanation:

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These type of leaders helps to settles the average performance by the employees.  

Hence, from the given information of the question,

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7 0
3 years ago
The following production data were taken from the records of the Finishing Department for June:Inventory in process, 6-1 (30% co
ad-work [718]

Answer:

Option (a) is correct.

Explanation:

Given that,

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Ending inventory units = 7,000 units

Beginning inventory units = 4,000 units

Number of material equivalent units of production in the June 30:

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3 years ago
Issues of growth are generally considered in: Multiple Choice neither the short-run nor the long-run frameworks. the short-run f
liraira [26]

Answer:

the long-run framework.

Explanation:

In Economics, Growth can be defined as an increase or rise in the level of output and production of goods and services over a specific period of time by a business entity.

Issues of growth are generally considered by economists in the long-run framework because growth itself is a long-run phenomenon in economics.

A long-run growth refers to the continuous and sustained increase in the level of output of goods and services or quantity of production that a business is able to achieve.

Hence, all of the four factors of production affects the level of growth that is being experienced by an individual or organization. These factors are;

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3 years ago
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