1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Fudgin [204]
3 years ago
9

Sage Company has recorded bad debt expense in the past at a rate of 1.5% of accounts receivable, based on an aging analysis. In

2017, Sage decides to increase its estimate to 2%. If the new rate had been used in prior years, cumulative bad debt expense would have been $387,800 instead of $299,000. In 2017, bad debt expense will be $122,400 instead of $91,130. If Sage’s tax rate is 27%, what amount should it report as the cumulative effect of changing the estimated bad debt rate?
Business
1 answer:
nikitadnepr [17]3 years ago
3 0

Answer:

The cumulative effect of the change in the rate of bad debt will, therefore, be $0.

Explanation:

According to International Accounting Standard 8( IAS 8), any changes in accounting policies (convention, base, principle, etcetera) and period errors are accounted for retrospectively. This means that previous period figures will have to be adjusted.

On the other hand, any changes in estimates are recognized prospectively. This includes reassessment of future benefits and obligations.

From the given information, the change in the rate of bad debt amounts to a change in estimate. As such, the change in this rate will affect the period in which the change took place. That is, 2017 and in future.

The cumulative effect of the change in the rate of bad debt will, therefore, be $0.

You might be interested in
He decides to take the company public through an IPO, issuing 2 million new shares. Assuming that he successfully completes the
Salsk061 [2.6K]

Answer:

$36.79

Explanation:

Calculation to determine What will be the IPO price per share

First step is to calculate the Cumulative shares

Cumulative shares = 375,000 + 400,000 + 250,000 + 400,000 + 2 million

Cumulative shares = 3.425 million

Now let calculate the IPO price

IPO price = $14 × $9 million / 3.425 million

IPO price= $36.79

Therefore What will be the IPO price per share is $36.79

4 0
3 years ago
Assume an increase in global agricultural production of food due to technology while global population remains the same. Due to
MA_775_DIABLO [31]

Answer:

The equilibrium price falls and quantity increases

Explanation:

When the supply of food rises without a corresponding increase in demand , there would be an excess supply.

When there's excess supply, prices fall and the quantity produced rises.

I hope my answer helps you

6 0
3 years ago
Suppose that Par, Inc., management encounters the following situations:
Anna11 [10]

Answer:

[a]. 10560, [b]. 14160, [c]. 7668.

Explanation:

[a]. In order to be able to solve this particular question we have to consider what is known as LINEAR PROGRAMMING.

We have the assumption that the function to be equals to 10A + 9B. The first step that we need to take here is to find the constraint for the linear programming relaxation which is;

1/2A + 5/6B \leq 600.

1/10A + 1/4B \leq 135. Thus, A \geq0 and B

With the help of excel solver and graphs, that we have the profit at $18 we are going have the value of A =300 and B =420. Therefore, the optimal solution = [300,420].

Thus, we have the objective function value to be = 10,560. [that is 10 * 300 + 420 * 18}.

[b]. For option b, where the profit increases to $20, the optimal solution lies on A =708 and B =0. Hence, objective function value = 14,160[ that is 20 * 708 + 0].

[c]. Here, there is increase in the sewing operation capacity to 750 hours. Therefore, we will have the value of A = 540 and B = 252.

Thus, the objective function value = 7668.

8 0
3 years ago
The National Income and Product Accounts simultaneously provide data on: (a) production and efficiency; (b) technological progre
Slav-nsk [51]
The answer is either a or c
7 0
2 years ago
Deborah Company's account balances at December 31 for Accounts Receivable and Allowance for Doubtful Accounts were $2,100,000 an
mart [117]

Answer:

The amount of the adjusting entry for bad debts at December 31 is C. $91,000

Explanation:

Adjustment entry is made on changes on the amount of provision for doubtful debts.

Increase in amount of  provision for doubtful debts increases the expenses in income statement.

Decreases in amount of  provision for doubtful debts decreases the expenses in income statement.

Allowance for Doubtful Accounts Balance  $35,000 (cr)

Allowance during th year                             $126,000

Increase in Allowance                                   $ 91,000

$ 91, 000 increase in allowance for doubtful debts increases the expenses in Income Statement

5 0
3 years ago
Other questions:
  • If all families receive exactly the same income the lorenz curve would appear as
    10·1 answer
  • Riley says that the present value of $700 one year from today if the interest rate is 6 percent isless than the present value of
    5·1 answer
  • Nationally what two factors caused the bubble in the real estate market
    10·1 answer
  • Reinforcement, contact, honesty, and fair expectations are
    7·2 answers
  • A company should accrue a loss contingency only if the likelihood that a liability has been incurred is:At least reasonably poss
    6·1 answer
  • The Analytical Hierarchy Process is used to decide among three projects that we'll call A, B, and C. The total score for project
    9·1 answer
  • The advanced industrial nations of the West committed themselves after World War II to removing barriers to the free flow of goo
    14·1 answer
  • Combinations of the marketing mix that reflect the unique attitudes, ancestry, communication preferences, and lifestyles of diff
    14·1 answer
  • The san francisco giants sell tickets based on​ ____________, where the prices often change based on demand and other variables.
    5·1 answer
  • Read these articles on the importance of setting goals, Article 1 and Article 2. As you read, think about how each article defin
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!