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siniylev [52]
2 years ago
9

Costello Corporation reported pretax book income of $500,900. During the current year, the reserve for bad debts increased by $6

,800. In addition, tax depreciation exceeded book depreciation by $40,900. Finally, Costello received $3,450 of tax-exempt life insurance proceeds from the death of one of its officers. Costello's deferred income tax expense or benefit would be:
Business
1 answer:
raketka [301]2 years ago
6 0

Answer:

Deferred income tax expense = $7,161

Explanation:

Given:

Bed debts increase = $6,800

Depericiation increase = $40,900

Tax-exempt life insurance = $3,450

Computation:

Assume tax rate = 21%

Taxable difference = 40,900 - 6,800

Taxable difference = 34,100

Deferred income tax expense = 34,100 × 21%

Deferred income tax expense = $7,161

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A company had average total assets of $955,000. Its gross sales were $1,108,000 and its net sales were $940,000. The company's t
Natali5045456 [20]

Answer:

It is 0.98

Explanation:

Total Assets Turnover Ratio(TATR) =   <u>   Net Sales                </u>      

                                                            Average Total Assets

Net Assets =Gross Sales-Trade discounts-Sales tax-Sales return

TATR = 940,000/955,000 = 0.98 times

It is the ratio of a company's net sales to its average assets employed.

It is a ratio that tells how efficient the company is using its assets to generate its revenue.

The drawback of this ratio is that, if the divisional manager performance is based on this, it may sometimes leads to short-term view of performance. This  may then encourage dysfunctional behaviour which may include refusal to replace an old assets with lower based value which when replace may reduce this ratio because of the higher based value of the new assets while sales still remain the same

6 0
3 years ago
You have just been promoted to manage a team of production specialists at work. You soon realize that many of the employees seem
Svetradugi [14.3K]

Answer:

Option (A) the ability of the group to stick together

Explanation:

The team is defined as the group of individual who work together to get a specified task done.

Here,

The workers seems to have withdrawn from the work and team that means, the group of members are not behaving as a team.

Therefore, it is needed for the manager of the team to make them stick together as a team so as to get the production better.

7 0
3 years ago
Having a savings account can contribute to a person’s overall financial well-being. Which one of the following is NOT a benefit
Elis [28]
The answer is C..............
7 0
3 years ago
Marin Company's accounts receivable arising from sales to customers amounted to $88000 and $77000 at the beginning and end of th
anzhelika [568]

Answer:

Marin Company

Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is

$345,000

Explanation:

a) Data and Calculations:

Accounts Receivable (Beginning) $88,000

Accounts Receivable (Ending) $77,000

Increase in Cash received from customers = $11,000

b) Income reported on the income statement for the year = $334,000

Increase in Cash received from Customers =                               11,000

Cash flows from operating activities to be reported =           $345,000

c) The Accounts Receivable reduced from $88,000 to $77,000.  This implied that some customers settled their accounts.  Therefore, there was inflow of cash from customers.  This increases the cash flows from operating activities.  This is why the difference is added to the Income as per income statement as a change in working capital.

5 0
2 years ago
Which of the following statements is true?a. Using accelerated depreciation rather than straight line would normally have no eff
IRISSAK [1]

Answer:

The correct answer is letter "A": Using accelerated depreciation rather than straight line would normally have no effect on a project's total projected cash flows but it would affect the timing of the cash flows and thus the NPV.

Explanation:

Accelerated depreciation is a form of accounting and taxation used in the first years of an asset to allow greater deductions. On the other hand, the deductions are distributed evenly throughout the life of the asset using the Straight-line Depreciation method. Accelerated depreciation facilitates higher expenses to be incurred during the first years of an asset while in use, and lower expenses years later, as long as the asset depreciates.

In that sense, when it comes to the total projected cash flow of a company on a project, neither the accelerated depreciation or the straight-line method would affect it but both of them have impact on the timing of the cash flows since accelerated depreciation demands higher expenses since the beginning of the possession of the assets while the straight-line method keeps the expenses steady. Both, also affect the net present value (NPV) of the company since with the accelerated depreciation the cash flow will be less and with the straight-line method it should be constant.

7 0
3 years ago
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