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svlad2 [7]
3 years ago
6

Testbank Multiple Choice Question 59 Incorrect answer. Your answer is incorrect. Try again. Blossom Co. at the end of 2020, its

first year of operations, prepared a reconciliation between pretax financial income and taxable income as follows: Pretax financial income $3550000 Estimated litigation expense 4550000 Extra depreciation for taxes (6540000) Taxable income $ 1560000 The estimated litigation expense of $4550000 will be deductible in 2021 when it is expected to be paid. Use of the depreciable assets will result in taxable amounts of $2180000 in each of the next 3 years. The income tax rate is 20% for all years. The deferred tax asset to be recognized is
Business
1 answer:
creativ13 [48]3 years ago
3 0

Answer:

$2,616,000

Explanation:

Deferred tax liability part of the depreciation expenses that is deducted in the reconciliation. The deferred tax liability to be recognized can therefore be estimated as follows:

Deferred tax liability = $6,540,000 × 40% = $2,616,000

Therefore,  the deferred tax asset to be recognized is $2,616,000 .

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You are trying to explain to your friend the difference between managers and leaders. You would be most accurate in saying _____
Klio2033 [76]

Answer:

B. Managers mantain order and leaders seek change

5 0
2 years ago
How much will a company's net operating income change if it undertakes an advertising campaign given the following data: Cost of
Olegator [25]

Answer:

Increase in net operating is $9,800

Explanation:

<u>Computation table</u>

Increase in sales                         $60,000

<u>Less:Variable expense (42%)    $25,200</u>

<u>Increase in contribution             $34,800</u>

<u>Less:Cost of advertising            $ 25,000 </u>

<u>Increase in net operating          $9,800</u>

<u />

5 0
2 years ago
insider trading laws prevent employees from buying or selling the securities of their employers. true or false
Pani-rosa [81]

Answer:

The statement is: False.

Explanation:

While often associated with illegal activity, insider trading encompasses both illegal and legal trading of securities and is monitored by the <em>Securities and Exchange Commission </em>(SEC). Illegal insider trading occurs when a person uses material, non-public information to decide between buying or selling a security.  

Legal insider trading takes place when corporate insiders, officers, directors, and employees trade securities issued by their own company. When a corporate insider buys or sells his company's securities, this trading activity must be reported to the SEC, which then discloses this information to the public.

4 0
2 years ago
Nutritional Foods reports merchandise inventory at the lower of the cost or market. Prior to releasing its financial statements
ELEN [110]

Answer:

1. Debit Cost of goods sold  $5,000

Credit Inventory account   $5,000

Being entries to write down merchandise inventory to its realizable amount.

2. Revised partial Income statement

                                         Amount

Sales revenue                 $121,000

Cost of goods sold        <u> ($54,000 )</u>

Gross Profit                    <u>  $67,000 </u>

Explanation:

According to IAS 2 inventories, Inventory is initially be recognized at the cost of purchase (which includes the cost of the item and other associated cost such as freight)

Subsequently, inventory would be measured at the lower of cost or net realizable value.

As such, whenever the cost is higher than the net realizable value, the cost of the inventory will be written down by

Since the current replacement cost of ending merchandise inventory is $16000 and the Cost is $21000.

Amount to be written down

= $21000 - $16000

= $5,000

To adjust for this,

Debit Cost of goods sold  $5,000

Credit Inventory account   $5,000

Total amount in cost of goods sold = $49,000 + $5,000

= $54,000

Revised partial Income statement

                                      Amount

Sales revenue                $121,000

Cost of goods sold          $54,000

Gross Profit                      $67,000

4 0
3 years ago
Which of the following layouts seeks the best personnel and machine utilization in repetitive or continuous​ production? A. ​Pro
Nat2105 [25]

Answer: Product-oriented layout

Explanation: The product-oriented layout is a production procedure where the materials and tools are located at the assembly lines.

This layout reduces the cost and time used in the handling of machines whereby optimizing the use of space. The product-oriented layout is mostly used when the same products are made without differences.

5 0
3 years ago
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