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Romashka [77]
3 years ago
13

A company with a December 31 fiscal year end sold and delivered $5,000 worth of inventory on December 15, 2016 with payments of

$1,200 collected on December 28, 2016 and $3,800 collected January 25, 2017. Under the accrual method of accounting, what amount of revenue would be recognized in 2016?
Business
2 answers:
Zepler [3.9K]3 years ago
8 0

Answer:

$5,000

Explanation:

Under the accrual accounting method, revenue is recognized and recorded in the books once the recognition criteria is met i.e once the goods or service has been delivered.

Under this system as well expenses are recorded once incurred.

As such, the time of cash payment does not affect the recognition of revenue. When revenue is earned and cash is yet to be paid, the entries required are debit accounts receivable and credit revenue.

On payment of cash, the entries are posted between cash and accounts receivables.

mestny [16]3 years ago
6 0

Answer:

Explanation:

Accrual accounting means revenue and expenses are recognized and recorded when they occur unlike cash basis which are revenues recognised recorded when there are cash payments.

Given:

Sold = $ 5,000

Cash in 2016 = $ 1,200

Cash in 2017 = $ 3,800

Using the above definition of accrual accounting,

Revenue = $ 5,000

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Nikitich [7]
The answer would be C) because haha no its not D) because people today abuse gambling and as a result go to addiction and lose all their money. Not A) because any website can add any music or u can play music in the background. Not B) because that's incorrect.
6 0
3 years ago
The conventional payback period ignores the time value of money, and this concerns Green Caterpillar's CFO. He hwas now asked yo
Cerrena [4.2K]

Answer: $‭1,645,379.41‬

Explanation:

The deficiency attached to the Discounted Payback period is that it stops recognizing cashflows after the project is paid off.

Year 1 discounted cash flow = 2,000,000/(1 + 10%) = $1,818,181.82

Year 2 discounted cashflow = 4,250,000 / (1 + 10%)² = $3,512,396.69

Year 3 discounted cashflow = 1,750,000/( 1 + 10%)³ = $1,314,800.90

Amount that Discounted Payback period will not recognize is;

= Cumulated discounted cash flow - Initial cost

= 1,818,181.82 + 3,512,396.69 + 1,314,800.90 - 5,000,000

= $‭1,645,379.41‬

6 0
3 years ago
Ted, a project manager, wants to invest in a project with an initial cost of $58,500 and cash flows of $32,400 and $38,500 in Ye
Art [367]

Answer:

The project will not be approved

Explanation:

Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested

IRR can be calculated with a financial calculator  

Cash flow in year 0 = $-58,500

Cash flow in year 1 = $32,400

Cash flow in year 2 = $38,500

IRR = 13,41%

profitability index = 1 + (NPV / Initial investment)  

Net present value is the present value of after-tax cash flows from an investment less the amount invested.  

NPV can be calculated using a financial calculator  

Cash flow in year 0 = $-58,500

Cash flow in year 1 = $32,400

Cash flow in year 2 = $38,500

I = 10%

NPV = $2,772.72

PI = 1 + $2,772.72 / $58,500 = 1.04

The project will not be approved because the PI is less than the amount of return the boss wants even though the IRR is less than the discount rate

To find the NPV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

To find the IRR using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.  

4 0
3 years ago
_______ includes the assessment and improvement of business strategies, economic sectors, work practices, technologies, and life
dezoksy [38]

Answer:

Sustainable development

Explanation:

Sustainable development is a synthesis between neoclassical economics and enviromentalism. It aims at bringing economic development and enviromental protection togheter, arguing that both things are possible.

Because of climate change, pollution, and public pressure, sustaniable development has become a very important part in political and business culture.

Both governments and firms now try to implement sustainable methods such as recycling, protecting the forests, or using renewable energies. Sometimes these measures become mandatory by law.

8 0
3 years ago
Prepare the issuer's journal entry for each of the following separate transactions.
Alekssandra [29.7K]

Answer:

A. Dr Cash $327,500

Cr Common Stock $210,000

Cr Capital Paid In $117,500

B. Dr Cash $90,000

Cr Common Stock $90,000

C. Dr Inventory $59,000

Dr Machinery $185,000

Cr Note Payable $95,000

Cr Common Stock $80,000

Cr Capital Paid In $69,000

Explanation:

Preparation of the issuer's journal entry

A. Dr Cash $327,500

Cr Common Stock $210,000

(52,500 shares* $4 par value )

Cr Capital Paid In $117,500

($327,500-$210,000)

B. Dr Cash $90,000

Cr Common Stock $90,000

C. Dr Inventory $59,000

Dr Machinery $185,000

Cr Note Payable $95,000

Cr Common Stock (4000 * $20) $80,000

Cr Capital Paid In $69,000

($59,000+$185,000-$95,000-$80,000)

5 0
3 years ago
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