Answer:
a. Cash payment (or an obligation to pay cash) occurs before the expense recognition.
Explanation:
Prepayments are amounts paid to a business before goods or services are received. This means that a prepayment is the payment of an obligation, bill, or expense before its due date, which is therefore, also before the expense recognition.
The correct answer is alternative a. Cash payment (or an obligation to pay cash) occurs before the expense recognition.
Answer:
The three examples of lighting are;
1. General lighting
2. Task lighting
3. Accent lighting
Explanation:
Lighting involves the use of electricity to serve a function. When designing a room, the type of lighting is important in achieving specific aesthetic purposes. The three examples of lighting are; General, task and accent lighting. They are further explained below;
1. General lighting
General lighting is usually meant to illuminate an entire room. It is supposed to make all corners of the room visible in it's entirety. It usually of a soft and flat nature to ensure that it looks as natural as possible. It;'s major function is to get one safely from one point to another. It's not meant for highlighting things on the space, rather the room should be viewed as one homogeneous space. A room of ambient light should give a warm feeling of relaxation especially after a stressful day. It allows the pupils to slightly dilate and also brings the mood of relaxation. Most yoga sessions usually prefer the use of ambient lighting during meditation. The following lights can be used to cause ambient light, namely; chandeliers, pendants, track, recessed and ceiling.
2. Task lighting
Task lighting usually covers a smaller area to illuminate that particular portion of the room. It is a much narrower and more concentrated type of light. Sometimes referred to as office lighting, this type of lighting works well one trying to concentrate on a specific task. They are majorly used when conducting activities that require a lot of attention that requires one to see more clearly. The tasks can include; sewing, reading, cooking and writing. The task lighting is always effective when it is brighter than the general lighting in a room. When the lighting in the room is brighter than the task lighting, it causes a shadowy effect that affects visibility. Task lighting improves alertness by stimulating your brain to be more active and notice even finer details of your work. The following fixtures can assist in creating task lighting, namely; swing arm lamps, pendants, under cabinet and vanity.
3. Accent lighting
Accent lighting is a special type of concentrate light that serves two purposes. Accent lighting serves to illuminate specific objects or points in a room that are interesting while trying to shadow the dull parts of the same room. Accent lighting adds more flavor and drama to specific objects in a room and is mostly used on objects such as; art work, pieces of furniture, decorative book display and wall decorations. Accent lighting brings a mood of importance and sophistication towards the objects being highlighted. It is majorly used in museums, art shows and buildings with historical meaning. To create accent lighting, the following lights are recommended; Recessed, Wall lights, Landscape and Track.
Solution :
Calculating the (NPV) Net Present value for the following matters to check the feasibility of the replacement of an 8 year old riveting machine with the new one :
Let
A = Year (n)
B = Initial outlay
C = Five-year MACRS depreciation percentage
D = Depreciation with MACRS Method (D)
E = Savings in earnings before depreciation
F = Taxable Income (earnings before depreciation - depreciation
G = Income taxes (Taxable Income *40%)
H = cash flow
I = PV of at the rate = /
A B C D E F G H I
0 82,500 -82,500 -82,500
1 20% 16500 27000 10500 4200 22800 20357.14
2 32% 26400 27000 600 240 26760 21332.91
3 19% 15675 27000 11325 4530 22470 15993.70
4 12% 9900 27000 17100 6840 20160 12812.04
5 11% 9075 27000 17925 7170 19830 11252.07
6 6% 4950 27000 22050 8820 18180 9210.55
7 0% 0 27000 27000 10800 16200 7328.06
8 0% 0 27000 27000 10800 16200 6542.91
NPV $22,329.39
As the NPV, the project is positive ($22,329.39) and so the company should replace the 8 year old riveting machine with the new one.
Answer:
4.96%
Explanation:
In order to determine the component after-tax cost of debt first we need to compute the before tax cost of debt by applying the RATE formula which is to be shown in the attachment below:
Given that,
Present value = $1,155
Future value or Face value = $1,000
PMT = 1,000 × 8.25% ÷ 2 = $41.25
NPER = 40 years × 2 = 80 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after applying the above formula
1. The pretax cost of debt is 3.54% × 2 = 7.08%
2. And, the after tax cost of debt would be
= Pretax cost of debt × ( 1 - tax rate)
= 7.08% × ( 1 - 0.30)
= 4.96%