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myrzilka [38]
3 years ago
6

Drake Appliance Company, an accrual basis taxpayer, sells home appliances and service contracts. Determine the effect of each of

the following transactions on the company's 2019 gross income assuming that the company uses any available options to defer its taxes.
Required:
a. In December 2018, the company received a $1,200 advance payment from a customer for an appliance that Drake special ordered from the manufacturer. The appliance did not arrive from the manufacturer until January 2019, and Drake immediately delivered it to the customer. The sale was reported in 2019 for financial accounting purposes.
b. In October 2019. the company sold a 6-month service contract for $240. The company also sold a 36-month service contract for $1,260 in July 2019.
Business
1 answer:
Nostrana [21]3 years ago
5 0

Answer:

(a) $1,200

(b) $330

Explanation:

(a)

  • The advance payment was issued in 2018, however the items throughout 2018 were not shipped.
  • The products were distributed throughout 2019 as well as the transaction for accounting information requirements was announced throughout 2019.

Therefore, in 2019, $1200 would include gross revenue  

(b)

<u>Service contract for 6 months will be:</u>

Drake would include gross income throughout 2019 of 120(40\times \frac{3}{6} ) ($)and gross income throughout 2020 of $120. In October year 2019, because a corporation offered a 6-month contract, total sales in 2019 represented just a 3-month service agreement.

<u>Service contract for 36 months will be:</u>

  • Throughout 2019 gross sales, Drake would include 120(= (= 1260\times \frac{6}{36} ).The residual balance would not have been all conducted until the close including its tax year of collection since the contract became sold through 36 month.
  • The residual amount of 1050 (= 1,260-210) is thus used throughout gross sales for 2020.  

Consequently,

⇒  Cumulative gross income used throughout 2019 = total earnings of 6 months service agreement + gross income of 36 months service agreement

⇒  120 + 210

⇒  330 ($)

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Vesnalui [34]

Answer:

Early tasks opposed to later tasks.

Explanation:

Shortening is a strategic procedure used by project managers to reduce or shorten a project's duration by cutting the duration of critical path tasks.

The rationale behind shortening of a project is basically to have a competitive advantage or edge in the market. In order to compete successfully, project managers are always expected to be spontaneous in bringing their company's goods and services to the market in a flash.

There are two important ways of shortening a particular project, these are;

1. Crashing.

2. Task splitting.

In project management, the longest task is considered to be the most effective and efficient candidate activities to shorten a project's duration.

In general, the better candidates for shortening are early tasks opposed to later tasks. The early start of tasks represents one of the primary date used in project scheduling and it's the earliest date a project manager commences an activity, with respect to all its predecessors and successors.

Early tasks usually involves the use of an easy approach to project kickoff while later tasks uses the difficult approach.

8 0
3 years ago
On December 15, 2018, Rigsby Sales Co. sold a tract of land that cost $3,200,000 for $5,000,000. Rigsby appropriately uses the i
ivann1987 [24]

Answer:

Instalment receivables (net) of $2,905,600 is the correct answer.

Explanation:

Instalment Receivables ($5,000,000 - $460,000) = $4,540,000

Deferred gross profit ($1,800,000 - $165,600) = $1,634,400

Instalment Receivables (Net) = $2,905,600

6 0
3 years ago
A static budget is one that shows estimated revenues and costs at multiple activity levels. true or false
maxonik [38]

Answer:

A static budget is one that shows estimated revenues and costs at multiple activity levels.

True

Which of the following is not typically found in a decentralized organization?

Asset center

Explanation:

3 0
2 years ago
On February 15, Jewel Company buys 7,300 shares of Marcelo Corp. common stock at $28.56 per share plus a brokerage fee of $400.
andriy [413]

Answer:

A. Debit Cash $8,614; credit Dividend Revenue $8,614.

Explanation:

The journal entry for recording the dividend as on April 15 is shown below:

On April 15

Cash Dr (7,300 shares × $1.18 per share) $8,614

       To Dividend revenue $8,614

(Being the dividend is recorded)

For recording this here we debited the cash as it increased the assets and credited the dividend revenue as the revenue is also increased

Therefore the correct option is A.

4 0
3 years ago
Grand Energy Corporation (GE) plans to issue bonds to raise $190 million. GE's investment banker will charge 5 percent of the to
Pavlova-9 [17]

The number of bonds that GE must sell to net $190 million after flotation costs is 200,000 bonds.

<h3>Number of bonds</h3>

First step is to calculate the amount issue

Net proceeds = Amount of issue x (1 - Flotation costs)

$190,000,000 = Amount of issue x (1 - 0.05)

Amount of issue = $190,000,000/0.95

Amount of issue= $200,000,000

Second step is to calculate number of bonds

Number of bonds = $200,000,000/$1,000

Number of bonds= 200,000 bonds

Inconclusion the number of bonds that GE must sell to net $190 million after flotation costs is 200,000 bonds.

Learn more about bonds here:brainly.com/question/25596583

7 0
2 years ago
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