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docker41 [41]
3 years ago
8

Alin Co. purchases a building for $300,000 and pays an additional $30,000 for closing costs (brokerage, title, attorney fees). A

lin also pays $20,000 in renovations, including painting, carpet, lighting, etc. Alin should record the cost of the building at:
Business
1 answer:
Yuri [45]3 years ago
3 0

Answer:

The answer is: $350,000

Explanation:

When Alin Co. establishes the total cost of the building it just purchased, it must include all of the following:

  • building's purchase value $300,000
  • associated closing costs $30,000
  • building improvements and renovations $20,000

So the total cost of the building is $300,000 + $30,000 + $20,000 = $350,000

You might be interested in
Do you agree with Unilever’s decision to link its brands with efforts to encourage healthy and environmentally sustainable behav
o-na [289]

Answer:

Yes.

Explanation:

I agree with Unilever’s decision to link its brands with efforts to encourage healthy and environmentally sustainable behaviors because it is an innovative  way to catch more customers who might have been in doubt of their products due to health and other related issues. It also presents a good image of the company and shows that Unilever is not only out there to sell their products and maximize profits but also to make sure that the consumers of their products are healthy and satisfied. This will help them retain their customers as well as to build unflinching loyalty.

3 0
3 years ago
you want to have $57,000 in your savings account 10 years from now, and you're prepared to make equal annual deposits into the a
VMariaS [17]

Answer:

$2,271.50

Explanation:

Future value of annuity=Annuity[(1+rate)^time period-1]/rate

57,000=Annuity[(1.079)^10-1]/0.079

57,000=Annuity[(1.079)^9]/0.079

57,000=Annuity * 1.9824/0.079

57,000=Annuity * 25.093671

Annuity=57,000/25.093671

Annuity = 2271.489094

Annuity = $2,271.50 appr.

6 0
3 years ago
Rory is the CFO of McIlroy Golf Designs Inc. MGDI earned $13 million last year and maintains a 30% dividend payout ratio. The co
BaLLatris [955]

Answer:

<u>Price per share of MGDI's stock is $78</u>

Explanation:

Earnings per share=Total earnings/Shares of common stock outstanding

=(13/2)=$6.5

PE ratio=Stock price/Earnings per share

Stock price=$6.5*12

=$78.

5 0
2 years ago
Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next 2 years, respe
Lena [83]

Answer:

$856,376.30

Explanation:

What is the terminal, or horizon, value of operations?

2 years, FCF 1 = 80,000, FCFC 2 = 100,000, Growth rate= 5%, WACC = 16%

==> 100,000*(1+0.05)/(0.16-0.05)

==> 100,000*(1.05/0.11)

==> 100,000*(9.545454(

==> 954,545

Calculating the value of Kendra's operations.

Years  Cash-flows   PVF at 16%    Present value

1           800,000       0.86206         68964.80

2          105,000        0.74316           78031.80

2          954,545        0.74316           <u>709379.70</u>

            Total value                           <u>856,376.30</u>

8 0
3 years ago
Plum Corporation began the month of May with $1,400,000 of current assets, a current ratio of 1.90:1, and an acid-test ratio of
matrenka [14]

Answer:

Plum Corporation

(1) current ratio = Current assets/current liabilities

(2) acid-test ratio = (Current asset -Inventory)/Current liabilities

(3) working capital = Current assets minus Current liabilities

(4) acid-test assets = quick assets

May 2 Purchased $75,000 of merchandise inventory on credit.

Current Assets:   $1,400,000 + $75,000 = $1,475,000

Current Liabilities: $737,000 + $75,000 = $812,000

Inventory: $147,000 +$75,000 = $222,000

(1) current ratio = $1,475,000/$812,000

= 1.82:1

(2) acid-test ratio = $1,475,000 - $222,000/$812,000

= 1.54:1

(3) working capital = Current Assets - Current Liabilities

= $1,475,000 - $812,000

= $663,000

May 8 Sold merchandise inventory that cost $55,000 for $150,000 cash.

Current Assets: $1,475,000 -55,000 + 150,000 = $1,570,000

Current Liabilities: $812,000

Inventory: $222,000 - 55,000 = $167,000

Quick Assets = $1,570,000 - 167,000 = $1,403,000

(1) current ratio = $1,570,000/$812,000

= 1.93

(2) acid-test ratio = $1,403,000/$812,000

= 1.73

(3) working capital = $1,570,000 - $812,000

= $758,000

May 10 Collected $26,000 cash on an account receivable.

Current Assets: $1,570,000 ($26,000 - $26,000) = $1,570,000

Current Liabilities: $812,000

Inventory: 167,000

Quick Assets = $1,570,000 - 167,000 = $1,403,000

(1) current ratio = $1,570,000/$812,000

= 1.93

(2) acid-test ratio = $1,403,000/$812,000

= 1.73

(3) working capital = $1,570,000 - $812,000

= $758,000

May 15 Paid $29,500 cash to settle an account payable.

Current Assets: $1,570,000 - $29,500 = $1,540,500

Current Liabilities: $812,000 - $29,500 = $782,500

Inventory: 167,000

Quick Assets = $1,540,500 - 167,000 = $1,373,500

(1) current ratio = $1,540,500/$782,500

= 1.97:1

(2) acid-test ratio = $1,373,500/$782,500

= 1.76:1

(3) working capital = $1,540,500 - $782,500

= $758,000

May 17 Wrote off a $5,000 bad debt against the Allowance for Doubtful Accounts account.

Current Assets: $1,540,500 - $5,000 = $1,535,500

Current Liabilities: $782,500

Inventory: 167,000

Quick Assets = $1,535,500 - 167,000 = $1,368,500

(1) current ratio = $1,535,500/$782,500

= 1.96:1

(2) acid-test ratio = $1,535,500/$782,500

= $1.96:1

(3) working capital = $1,535,500 - $782,500

=$753,000

May 22 Declared a $1 per share cash dividend on its 69,000 shares of outstanding common stock.

Current Assets: $1,535,500

Current Liabilities: $782,500

Inventory: 167,000

Quick Assets = $1,535,500 - 167,000 = $1,368,500

(1) current ratio = $1,535,500/$782,500

= 1.96:1

(2) acid-test ratio = $1,535,500/$782,500

= $1.96:1

(3) working capital = $1,535,500 - $782,500

=$753,000

May 26 Paid the dividend declared on May 22.

Current Assets: $1,535,500 -$69,000 = $1,466,500

Current Liabilities: $782,500

Inventory: 167,000

Quick Assets = $1,466,500 - 167,000 = $1,299,500

(1) current ratio = $1,466,500/$782,500

= 1.87:1

(2) acid-test ratio = $1,299,500/$782,500

= 1.66:1

(3) working capital = $1,466,500 - $782,500

= $684,000

May 27 Borrowed $120,000 cash by giving the bank a 30-day, 10% note.

Current Assets: $1,466,500 + $120,000 = $1,586,500

Current Liabilities: $782,500 + $120,000 = $902,500

Inventory: 167,000

Quick Assets = $1,586,500 - 167,000 = $1,419,500

(1) current ratio = $1,586,500/$902,500

= 1.76

(2) acid-test ratio = $1,419,500/$902,500

= 1.57

(3) working capital = $1,586,500 - $902,500

= $684,000

May 28 Borrowed $135,000 cash by signing a long-term secured note.

Current Assets: $1,586,500 + $135,000= $1,721,500

Current Liabilities: $902,500

Inventory: 167,000

Quick Assets = $1,721,500 - 167,000 = $1,554,500

(1) current ratio = $1,721,500/$902,500

= 1.91:1

(2) acid-test ratio = $1,554,500/$902,500

= 1.72

(3) working capital = $1,721,500 - $902,500

= $819,000

May 29 Used the $255,000 cash proceeds from the notes to buy new machinery.

Current Assets:  $1,721,500 - $255,000 = $1,466,500

Current Liabilities: $902,500

Inventory: 167,000

Quick Assets = $1,466,500 - 167,000 = $1,299,500

(1) current ratio = $1,466,500/$902,500

= 1.62:1

(2) acid-test ratio = $1,299,500/$902,500

= 1.44:1

(3) working capital = $1,466,500 - $902,500

= $564,000

Explanation:

a) Data and Calculations:

May 1, Current Assets = $1,400,000

Ratio of current assets to current liabilities = 1.90:1

Acid -test ratio = 1.70:1

Therefore, current liabilities = $1,400,000/1.9 = $737,000

Current Assets minus Inventory/$737,000 = 1.7

Therefore, current assets minus inventory = $737,000 * 1.7 = 1,253,000

Inventory = Current Assets - (Current assets -inventory)

= $1,400,000 - $1,253,000

= $147,000

3 0
3 years ago
Read 2 more answers
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