Answer:
The cost basis for the land is equal under both options.
Explanation:
If Taylor pays Ella $150,000 in cash and assumes the mortgage of $100,000, the cost basis of the land will be $250,000 (= $150,000 + $100,000). If he decides to pay Ella the full amount of $250,000, that will also be the cost basis of the land.
The only real difference is that if Taylor decides to assume the mortgage, he will need a smaller initial cash flow ($150,000).
Answer:
- Record a liability.
- Disclose in notes.
- Have no disclosure.
Explanation:
A contingent liability should only be recorded if the likelihood of it happening is known and the value can reasonably be estimated.
In the first scenario, it is likely that Huprey will lose so the likelihood is known. The value can also be reasonably estimated to be $1,070,000 so this should be recorded as a liability.
In the second scenario, the likelihood is known but the value cannot be estimated. In such a case, simply disclose this possibility in the notes of the financial statement.
For the third scenario, the possibility of the liability being incurred is remote so there is no need to either record or disclose the liability.
The answer is false because they dont have to answer anything.
Answer:
Cash Debit $ 220
Subscriptions received in advance Credit $ 220
Explanation:
The most appropriate journal entry would be by debiting cash with $ 220 since cash has been received.
The credit account would be Subscriptions received in advance since the magazines have to be delivered in 2018 and the revenue has not been earned at the time of collections. This would be classified in the balance sheet under current liabilities.
A collusive agreement between two firms is likely to break down when detection of cheaters is difficult
.
Option D
<u>Explanation:
</u>
Collusion is a secret agreement between two or more parties to suppress open competition by misleading, lying or defrauding others of their rightfulness or achieving a goal prohibited by law that usually is to defraud or gain an unacceptable market advantage.
It is an agreement between companies or individuals that divides a market establishes prices, limits or limits production opportunities. It can include "strike, pay manipulation, kickbacks or the freedom of the relationship between the two parties." All collusion-driven actions are considered null and void legally.
In the USA, Canada collusion is illegal because of antitrust legislation, but implicit collusion even now takes place in the method of price management and tacit agreement.
Example: Google and Apple announced that both firms decided not to hire people to work together to stop wage growth in 2015, a statement against bullying collusion by employees.
