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-Dominant- [34]
3 years ago
5

Charm Co. owns a delivery truck with an original cost of $10,000 and accumulated depreciation of $7,000. Charm acquired a new tr

uck by exchanging the old truck and paying $2,000 in cash. The new truck has a fair value of $5,000 at the time of the exchange. What amount of gain or loss should Charm recognize?
Business
1 answer:
Kazeer [188]3 years ago
4 0

Answer:

no loss or gain should be recognized by the Charm

Explanation:

Given:

Original cost of the truck = $10,000

Accumulated depreciation of the truck = $7,000

Thus,

the value of the truck after depreciation = $10,000 - $7,000 = $3,000

The amount paid with the exchange of the truck = $2,000

Therefore, the total considerable amount paid for the new truck

= value of the truck after depreciation +  amount paid with the exchange

= $3,000 + $2,000

= $5,000

Also, the fair value of the truck  = $5,000

Since, the amount total considered amount paid by the charm co. for the new truck is equal to the fair value of the truck.

Hence, there no loss or gain should be recognized by the Charm

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Given the characteristics: (1) many buyers and sellers, (2) free entry and exit, (3) perfect information, and (4) heterogeneity
frez [133]

Answer:

1) many buyers and sellers, (2) free entry and exit

Explanation:

A monopolistic competition is when there are many buyers and sellers of heterogeneous goods and services. There are free entry of firms into and out of the industry. Firms set the price for their products. Buyers and sellers do not have perfect information. In the long run, monopolistic competition make zero economic profit.

A pure competition is characterised by many buyers and sellers of homogenous goods and services. Buyers and sellers have perfect information. There are no barriers to entry or exit of firms in the industry. Market price is set by the market forces. Firms make zero economic profit in the long run.

I hope my answer helps you

7 0
3 years ago
Innovative Products reported net income of $219,000. Beginning and ending inventory balances were $44,500 and $46,500, respectiv
andrew11 [14]

Answer:

$213,500

Explanation:

Given the information above, first, we'll determine increase in inventory

Increase inventory = Ending inventory - Beginning inventory

Increase inventory = $46,500 - $44,500

Increase inventory = $2,000

We will also calculate decrease in account payable

Decrease in accounts payable = Beginning accounts payable - Ending accounts payable

Decrease in accounts payable = $40,500 - $37,000

Decrease in accounts payable = $3,500

Therefore,

Net operating cash flows = Net income - Increase inventory - Decrease in accounts payable

Net operating cash flows = $219,000 - $2,000 - $3,5000 = $213,500

3 0
3 years ago
What should be done to differentiate one inbound load from another?
g100num [7]
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4 0
3 years ago
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In 2018, Alpha Company had $48,000,000 in Sales/Revenues, $15,500,000 in Costs of Goods Sold (COGS), $3,600,000 in Sales, Genera
allochka39001 [22]

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Explanation:

6 0
3 years ago
Assume F&S offers a deal whereby enrolling in a new membership for $700 provides a year of unlimited access to facilities an
barxatty [35]

Answer:

a. There are two separate performance obligations in the contract. Gym membership is one performance obligation and the providing 25% discount on yoga classes is another performance obligation.

b. The standalone selling price of annual membership is $720. Therefore, F&S will allocate 28*((700*(30/720+30)) of 700 contract price to the discount voucher on yoga course and the remaining $672 will be allocated to membership.

C. solution is in the image attached.

Explanation:

b. F&S offers a 10% discount on yoga classes to all customers as part of promotional strategy. Therefore a 25% discount voucher provides a customer with an incremental value of 15% (25%-10%). Thus, the estimated stand alone selling price of the discount voucher provided by F&S is $30 ($500  * 15% incremental discount * 40% likelihood of the vouchers being redeemed).

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