Answer:
goodwill = $195,000
Explanation:
goodwill = offered purchase price - fair value of assets - fair value of patents = $5,100,000 - $4,600,000 - $305,000 = $195,000
Customer loyalty is part of a company's goodwill, so it will not be included in this calculation. Goodwill is the difference between the acquisition price of a company and the fair value of its assets.
Answer:
c. Decrease liabilities and increase revenues
Explanation:
The correct adjusting journal entry which shall be recorded by the Duluth Co. in accounts in respect of advance income as as at December 31, is given below:
Debit Credit
Advance income(Liability) $2,000
($6,000/6*2)
Revenue $2,000
Since the liability has been debited in the above mentioned journal entry, which mean that it has been decreased and the revenue has been credited, which means that it has been increased.
So based on the above discussion, the answer is c. Decrease liabilities and increase revenues
Answer:
Debit Advertising expense $916.67
Credit Prepaid Advertising $916.67
Being entries to recognize advertising expense incurred for 5 months.
Explanation:
When an amount is paid in advance, the entries posted are
Debit Prepaid Advertising
Credit Cash account (with the amount prepaid)
As the expense is incurred, entries required would be
Debit Advertising expense
Credit Prepaid Advertising (with the amount incurred)
Expense incurred in 5 months
= 5/6 × $1100
= $916.67
Hence the entries required will be
Debit Advertising expense $916.67
Credit Prepaid Advertising $916.67
Being entries to recognize advertising expense incurred for 5 months.
Answer: 0
Explanation:
Firstly, we will calculate the nominal value in 2015 which will be:
= $500 x 1 million
= $500 million
The nominal value in 2016 will be:
= $1000 x 1 million
= $1 billion
Real GDP will be the price of the base year multiplied by the quantity of the current year which will be:
= $500 million x 1 million sets
= $500 million
Therefore, the increase in real GDP is zero.
