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3 years ago

Acquisition costs; journal entries

Business

1 answer:

Aleks [24]3 years ago

7 0

Answer:

Journal entries for the transactions are given below

Explanation:

1. Development of new product

DEBIT CREDIT

Research and development $24,000

Cash $24,000

2. Paid the plaintiff for losing patent

DEBIT CREDIT

Legal fee (expense) $8,000

Cash $8,000

3. Bought Equipment and signed non-interest bearing note

DEBIT CREDIT

Equipment Cash price $37,000

Discount on note payable $5,000

Cash paid $18,000

Note payable $24,000

4. Installed sprinkler system

DEBIT CREDIT

Sprinkler system $40,000

Cash $40,000

5. Plaintiff paid for successful infringement suit on its patent

DEBIT CREDIT

Patent $24,000

Cash $24,000

6. Bought New equipment and traded old one

DEBIT CREDIT

New Equipment $13,600

Accumulated depreciation $6,800

Loss on sale $3,400

Old Equipment $13,400

Cash $10,400

Working:

Accumulated depreciation = Original Cost - book value

Accumulated depreciation = $13,400 - $6,600

Accumulated depreciation = $6,800

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3 years ago

A company pays its employees $3,850 each Friday, which amounts to $770 per day for the five-day workweek that begins on Monday.

liq [111]

Answer:

$3080

Explanation:

Calculation to determine what the amount of salaries earned but unpaid at the end of the accounting period is:

Salaries earned but unpaid at the end of the accounting period =3850-$770

Salaries earned but unpaid at the end of the accounting period =$3080

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2 years ago

Slim made a single deposit of $5,000 in an account that pays 7.2% in 2015. What equal-sized annual withdrawals can Slim make fro

evablogger [386]

Answer:

annual withdrawals is $1,393.87

Explanation:

given data

Amount Deposited = $5,000

Annual Interest Rate = 7.2%

First withdrawal = 2020

last withdrawal = 2025

solution

we consider equal sized annual withdrawals = x

so we can say that Amount Deposited amount will be as

$5,000 = $\frac{x}{(1+0.72)^5} + \frac{x}{(1+0.72)^6} + \frac{x}{(1+0.72)^7} + \frac{x}{(1+0.72)^8} + \frac{x}{(1+0.72)^9} + \frac{x}{(1+0.72)^{10}}$ ..........1

we take common here $\frac{x}{(1+0.72)^{4}}$

$5,000 = $\frac{x}{(1+0.72)^{4}} \times ( \frac{1}{(1+0.72)^1} + \frac{1}{(1+0.72)^2} + \frac{1}{(1+0.72)^3} + \frac{1}{(1+0.72)^4} + \frac{1}{(1+0.72)^5} + \frac{1}{(1+0.72)^{6}} )$

solve it we get

x = $1,393.87

so that annual withdrawals is $1,393.87

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3 years ago

20.Assume that you just graduate and get a job. You will work for 40 years and save each year before you retire. During retireme

amid [387]

Answer:

How much money will you need to have at the moment you retire?

$1,287,858

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$4,971.33

Explanation:

we have to first determine the amount of money you need to finance your retirement distributions:

using the annuity due present value formula, PV = annuity payment x annuity due factor (PV, 8%, n = 40)

PV = $100,000 x 12.87858 = $1,287,858

now we must use the ordinary annuity future value formula, FV = annuity payment x annuity factor (FV, 8%, n = 40)

annuity payment = FV / annuity factor = $1,287,858 / 259.057 = $4,971.33

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3 years ago