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3 years ago

12

If a firm bakes cookies and sells them for $1,000 while spending $100 on sugar, $150 on chocolate, $50 on other supplies, $300 o

n wages and $400 on rent, what is its value added?

1 answer:

Fantom [35]3 years ago

8 0

The value added is 0, because if we added the value they spend on sugar and the other supplies and etc. it will be $1,000

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Which of the following statements is CORRECT?a. Two firms with the same expected free cash flows and growth rates must also have

brilliants [131]

Answer:

.b. It is appropriate to use the constant growth model to estimate a stock's value even if its growth rate is never expected to become constant

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2 years ago

Mercury Inc. purchased equipment in 2019 at a cost of $497,000. The equipment was expected to produce 580,000 units over the nex

Ivan

Answer:

1.

Gain or (Loss) on sale = (17000) Loss

2.

Cash 253600 Dr

Accumulated Depreciation 226400 Dr

Loss on Sale 17000 Dr

Equipment 497000 Cr

3.

Gain or (Loss) on sale = 9400 Gain

4.

Cash 280000 Dr

Accumulated Depreciation 226400 Dr

Gain on Sale 9400 Cr

Equipment 497000 Cr

Explanation:

We first need to calculate the carrying value of the equipment at the date of disposal. The carrying value is calculated as follows,

Carrying value = Cost - Accumulated depreciation

Depreciation 2019 = (497000 - 33000) * 83000 / 580000

Depreciation 2019 = 66400

Depreciation 2020 = (497000 - 33000) * 133000 / 580000

Depreciation 2020 = 106400

Depreciation 2021 = (497000 - 33000) * 67000 / 580000

Depreciation 2021 = 53600

Carrying value = 497000 - [ 66400 + 106400 + 53600 ]

Carrying value = $270600

1.

Gain or (Loss) on sale = Sales price - Carrying Value

Gain or (Loss) on sale = 253600 - 270600

Gain or (Loss) on sale = (17000) Loss

2.

Cash 253600 Dr

Accumulated Depreciation 226400 Dr

Loss on Sale 17000 Dr

Equipment 497000 Cr

3.

Gain or (Loss) on sale = Sales price - Carrying Value

Gain or (Loss) on sale = 280000 - 270600

Gain or (Loss) on sale = 9400 Gain

4.

Cash 280000 Dr

Accumulated Depreciation 226400 Dr

Gain on Sale 9400 Cr

Equipment 497000 Cr

6 0

2 years ago