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Leokris [45]
3 years ago
12

Due to an error in computing depreciation expense, Crote Corporation understated accumulated depreciation by $64 million as of D

ecember 31, 2018. Crote has a tax rate of 40%. Crote's retained earnings as of December 31, 2018, would be (Round million answer to 2 decimal places.):
Multiple Choice

Overstated by $64.00 million.

Overstated by $38.40 million.

Understated by $64.00 million.

Understated by $38.40 million.
Business
2 answers:
Mekhanik [1.2K]3 years ago
7 0

Answer

Retained earnings will be overstated by $38.40 million

Explanation:

The overstatement of retained earnings by this amount arises from the fact that if the depreciation of $64 million had been charged, the charge will have been tax deductible at 40% thus the amount overstated if (1-40%) x $64m =$38.4m.

posledela3 years ago
7 0

Crote's retained earnings as of December 31, 2018, would be overstated by \$38.40 \text{ million}

<u>Explanation: </u>

Overstated = The amount is more than it ought to be = Very high

Accumulated depreciation =  \$64 \text{ million}

Tax rate = 40\%

In round 2 decimal places = 0.40

Right now, revenue is underestimated because cash was removed due to error of the depreciation costs

Round million on December 31, 2018 as 2 decimal places = \rightarrow \frac{64}{2} = 38

In decimals = \$38.40 \text{ million}

If your initial inventory has been overstated, you overestimate the cost of sold items, and underestimate net profit and net earnings. When the inventory ends in excess, the costs of the goods are understated and the gross profit and net profit is excessively increased.  

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The following information applies to the questions displayed below] A local Chevrolet dealership carries the following types of
myrzilka [38]

Answer:

Chevrolet Dealership

A) The total cost of the entire inventory is:

= $575,000

B) Each inventory would be reported at the LCNRV:

Inventory Items  Quantity  Reporting Cost/Value

Vans                        4              NRV

Trucks                     7              NRV

2-door sedans        3              Cost

4-door sedans        5              Cost

Sports cars              1              Cost

SUVs                       6              NRV

C) Journal Entry:

Debit Cost of goods sold $27,000

Credit Inventory $27,000

To write-down costs to net realizable values.

D) TRUE.

Explanation:

a) Data and Calculations:

Inventory Items  Quantity    Cost per unit      NRV per Unit      LCNRV

Vans                        4           27000 $108,000      25000        $100,000

Trucks                     7            18000   126,000       17000           119,000

2-door sedans        3           13000     39,000      15000            39,000

4-door sedans        5           17000     85,000     20000            85,000

Sports cars              1          37000      37,000     40000            37,000

SUVs                       6         30000    180,000     28000           168,000

Total Cost                                      $575,000                         $548,000

3 0
3 years ago
What term dd thorstein veblen use to describe the fundmental change in people's orientation to the economy?
Sedbober [7]

Conspicous Consumption was the term used by thorstein veblen to describe fundamental change in people's orientation to the economy.

Who was Thorstein Veblen?

Thorstein Veblen was a famous sociologist and economist who wrote the book The Theory of the Leisure Class. He wrote about the relationship between the economy, culture, and society.

Conspicuous consumption is the act of acquiring things or services specifically with the intention of flaunting one's affluence. When publicly displayed products and services are too expensive for other people in a person's class, conspicuous consumption is a way to demonstrate one's social position. Although it is frequently associated with the wealthy, this type of consumerism can occur in any income class.

The complete question is :

What term did Thorstein Veblen use to describe the fundamental change in people's orientation to the economy from producing goods to using them?

To learn more about Conspicous Consumption visit the link:

brainly.com/question/14546547?referrer=searchResults

#SPJ4

6 0
2 years ago
Question 4 (2 points) Which component of the policyholder's coverage is most expensive? Their uninsured motor vehicle coverage T
Archy [21]

Their medical payments coverage

5 0
2 years ago
According to the acquired needs theory, which of the following characteristics describe people who have a high need for affiliat
Gelneren [198K]

Answer: D.

Explanation:

4 0
3 years ago
When the purpose of cost allocation is to provide information for economic decisions or to motivate managers and​ employees, whi
natulia [17]

Answer:

The correct answer is C) the cause-‐‑and-‐‑effect and the benefits-‐‑received criteria.

Explanation:

In general, the costs that are collected in the accounts serve three general purposes:

  1. Provide cost reports to measure utility and evaluate inventory (income statement and balance sheet).
  2. Offer information for the administrative control of the operations and activities of the company (control reports).
  3. Provide information to support planning and decision making (analysis and special studies).

Control constitutes the management for the fulfillment of the proposed goals, while cost reduction refers to the effort aimed at achieving a decrease in the levels or magnitude of the costs. The cost of the quality of a product represents the work that requires the identification and administration of the necessary expenditures to maintain an adequate degree of quality, that is, the supervision of compliance with the rules of its design and its specifications.

6 0
3 years ago
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