Answer:
the acid-test ratio is 0.75 times
Explanation:
The computation of the acid-test ratio is shown below:
We know that
Acid-test ratio is
= Quick assets ÷ current liabilities
= $6,123,000 ÷ $8,144,000
= 0.75 times
Hence, the acid-test ratio is 0.75 times
basically we divided the quick assets from the current liabilities so that the acid-test ratio could come
The requirement of Kameron, Candice, and Leo should be for pledging the personal assets in order to give the guarantee for the payment obligations with respect to the PU.
The information related to the pledged asset is as follows:
- A pledged asset is a valuable possession that could be transferred to the lender in order to secure the debt or a loan.
- The pledged asset should be considered as collateral that could be held by a lender and in return, it is for lending the funds.
- Also, it can decrease the down payment that should be needed for the loan along with this if there is any change in the interest rate so the same should be decreased.
Therefore we can conclude that, the requirement done by these three people is needed for pledging the personal assets in order to give the guarantee for the payment obligations with respect to the PU.
Learn more about the LLC here: brainly.com/question/1214636
Answer:
D) $150,000
Explanation:
Insurance proceeds that are not reinvested in replacing damaged property are taxed. Apparently Prime corporation didn't reinvest into replacing the property, so this transaction should be taxed as a property sale. Prime received $400,000 for the building with a $350,000 basis which results in a net gain = $50,000.
The other $100,000 were given as replacement income and therefore should be taxed as such.
So the total taxable amount = $50,000 + $100,000 = $150,000
Answer:
a. Overstates Year 1 cost of goods sold.
b. Understates Year 1 net income
c. Understates Year 2 cost of goods sold
Explanation:
a. The formula for Calculating the Cost of Goods sold is;
<em>Cost of Goods Sold = Opening inventory + Purchases - Closing inventory.</em>
If the closing inventory is understated, it will reduced the amount being subtracted from Purchases and Opening inventory which would means that Cost of Goods sold will be overstated.
b. The Cost of goods sold is deducted from sales to give Gross profit. If Cost of goods is overstated, it will reduce Gross Profit higher than it should. A lower Gross Profit equates to a lower Net Income.
c. Going by the formula in <em>a;</em>
<em>Cost of Goods Sold = Opening inventory + Purchases - Closing inventory.</em>
In Year 2, the understated Year 1 closing stock will become the understated Year 2 Opening stock. With the opening stock understated, the Cost of goods will be understated as well because Opening stock is meant to increase Cost of goods sold as the formula shows. If it is understated, the amount that it will add will be understated as well.
