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alisha [4.7K]
3 years ago
6

2014, Herron Resources purchased Stinson Tile for $4.5 million. On December 31, 2020, the Stinson division reported net assets o

f $5,600,000 (including $1,800,000 of goodwill). Herron reviewed the Stinson division and determined that expected net future cash flows equaled $4,700,000 and the fair value is estimated to be only $3,900,000. What entry should Herron record concerning the Stinson division on December 31, 2020
Business
1 answer:
V125BC [204]3 years ago
5 0

Answer:

Loss on impairment 1,700,000

                                   Goodwill           1,700,000

Explanation:

Herron Resources has an impairment for The Stinson division.

The Stinson division reported net assets of $5,600,000 (including $1,800,000 of goodwill) and the fair value is estimated to be only $3,900,000.

So  $5,600,000 - $3,900,000 = $ 1,700,000

This is how we recognize as an impairment so we need to register the loss and the - at the Goodwill:

Loss on impairment 1,700,000

                                   Goodwill           1,700,000

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Answer:

Present Value = $9,417.69  (Approx)

Explanation:

Given:

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Total payments = 25

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Computation:

First payment [7 years from now ]

So,

Present Value = $1,400(1/1.08⁶)[1 - (1/1.08)²⁵] / 0.08

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2 years ago
A strategy is: Multiple Choice an action plan to maximize rewards in the current period in return for big risks. a procedure for
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Answer:

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3 years ago
Kim Jordan says that she believes that "to whom much is given, much is expected." This statement speaks of her personal convicti
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Answer:

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Which of the following scenarios could lower a firm’s demand for labor? Correct Answer(s) James operates a restaurant in a seasi
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Answer:

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Explanation:

In winter, the patronage at James' resturant would drop because tourists would have left. Because demand at the resturant has dropped, James would reduce his demand for Labour which are his staffs. He would let some staffs go temporarily to reduce costs .

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I hope my answer helps you.

8 0
3 years ago
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Answer:

Rebel

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