Put these decisions in the correct order

Which of the following statements concerning the compressed adjusted present value (APV) model is NOT CORRECT

RSB [31]

Answer:

e. The tax shields should be discounted at the cost of debt

Explanation:

6 0

3 years ago

Corporation A and Corporation Z go into partnership to develop, produce, and market a new product. The two corporations contribu

sasho [114]

Answer:

You didn´t post the complete information of the exercise, I searched the exercise online and tried to ask the most useful question.

Explanation:

a. Corporation A realized a $4.000 loss, and Corporation Z realized a $68.000 gain on the contribution of business equipment to AZ partnership. Neither corporation recognizes gain or loss.

b. A's basis in it's one-half equity interest in AZ Partnership is $134.000, while Z's basis in it's one-half equity in AZ partnership is $62.000.

c. AZ partnership's basis in the equipment contributed by A is $34.000 and in the equipment contributed by B is $12.000.

6 0

4 years ago

Novak Corporation is preparing its 2017 statement of cash flows, using the indirect method. Presented below is a list of items t

wariber [46]

Answer: Please see explanation for answer

Explanation:

Purchase of land and build ===--Cash payment in investing section

Decrease in accounts receivables-----Added to net income in the operating section

Issuance of stock-----Cash receipt in financing section

Depreciation expense-----Added to net income in the operating section

Sale of land at book value-------Cash receipt in investing section

Sale of land at a gain--------Cash receipt in investing section AND deducted from net income in the operating section

Payment of dividends-------Cash payment in the financing section

Increase in accounts receivables-------Deducted from net income in operating section

Purchase of available-for-sale investment-----Cash payment in investing section

Increase in accounts payable-----Added to net income in operating section

Decrease in accounts payable-------Deducted from net income in operating section

Loan from bank by signing note------Cash receipt in financing section

Purchase of equipment using a note-----Non-cash investing and financing activity

Increase in inventory-----Deducted from net income in operating section

Issuance of bonds-----Cash receipt in financing section

Redemption of bonds payable------Cash payment in financing section

Sale of equipment at a loss---Cash receipt in investing section AND added to net income in the operating section

Purchase of treasury stock----Cash payment in financing section

or using the code, we have

a) Purchase of land and building - P-I

b) Decrease in accounts receivable - A

c) Issuance of stock - R-F

d) Depreciation expense - A

e) Sale of land at book value - R-I

f) Sale of land at a gain. - R-I and D

g) Payment of dividends - P-F

h) Increase in accounts receivable - D

i) Purchase of available-for-sale investment - P-I

j) Increase in accounts payable - A

k) Decrease in accounts payable - D

l) Loan from bank by signing note - R-F

m) Purchase of equipment using a note - N

n) Increase in inventory - D

o) Issuance of bonds. - R-F

p) Retirement of bonds payable - P-F

7 0

3 years ago

Read 2 more answers

Dawnell is a skilled dancer. She is currently teaching modern dance full time for three high schools and makes $44,000 a year. S

Troyanec [42]

Answer: d. a two year opportunity cost of $40,000 after leaving her teaching position.

Explanation:

Hi, to answer this we have to analyze the information given.

The difference between teaching modern dance and joining a touring dance company per year is:

$44,000- $24,000 = $20,000

We simply subtracted the earnings per year at the touring dance company to the earnings per year of teaching modern dance.

The opportunity cost per year is $20,000.

Since she is joining the touring dance company for 2 years, the opportunity cost is:

20,000 x 2 = 40,000

Dawnell’s decision will result in a two-year opportunity cost of $40,000 after leaving her teaching position. (option d)

8 0

3 years ago

Read 2 more answers

In the GMP partnership (to which Elan seeks admittance), the capital balances of Mary, Gene, and Pat, who share income in the ra

Inga [223]

Answer:

A. $222,000

B. Dr Cash $80,000

Dr Goodwill 31,000

Cr Elan, Capital $111,000

C. Dr Cash $200,000

Cr Mary, Capital $40,080

Cr Gene, Capital $20,040

Cr Pat, Capital $6,680

Cr Elan, Capital $133,200

Explanation:

A. Calculation to determine how much must Elan invest for a one-third interest

First step is to calculate the 2/3 of the total resulting capital balance of Mary, Gene, and Pat

Mary $266,400

Gene 133,200

Pat 44,400

Total $44,000

Total resulting capital balance=$444,000/2/3)

Total resulting capital balance= $444,000 / .666666

Total resulting capital balance=$ 666,000

Second step is to calculate how much must Elan invest for a one-third interest

Investment for one-third interest= $666,000 x 1/3

Investment for one-third interest=$666,000 x .333333

Investment for one-third interest=221,999.9

Investment for one-third interest=$222,000 (Approximately)

Therefore how much must Elan invest for a one-third interest is $222,000

B. Preparation of journal entry for the admission of Elan if she invests $80,000 for a 20 percent interest and goodwill is recorded.

First step is to calculate the Estimated amount of goodwill to the new partner

Estimated total capital $ 555,000

[($444,000÷(100%-20%)]

Less Total net assets (524,000)

($444,000 + $80,000)

Estimated goodwill to the new partner $31,000

($ 555,000-$524,000)

Now let prepare the journal entry

Dr Cash $80,000

Dr Goodwill 31,000

Cr Elan, Capital $111,000

[(444,,000÷(100%-20%)*20%)]

=($444,000/80%*20%)

=$111,000

C. Preparation of journal entry for the admission of Elan if she invests $200,000 for a 20 percent interest while the Total capital will be $600,000.

First step

Amount Invested in partnership $ 20,000

Less New partner's book value ($133,200)

[($444,000 + $222,000) x .20]

Difference $66,800

($200,000-$133,200)

Now let prepare the journal entry using ratio 6:3:1

Dr Cash $200,000

Cr Mary, Capital $40,080

($66,800 x .60)

Cr Gene, Capital $20,040

($66,800 x .30)

Cr Pat, Capital $6,680

($66,800 x .10)

Cr Elan, Capital $133,200

($666,000 x .20)

7 0

3 years ago