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8_murik_8 [283]
3 years ago
7

Which of the following is not true regarding Depreciation? Group of answer choices Depreciation allocates the cost of a fixed as

set over its estimated life. Depreciation expense reflects the decrease in market value each year. Depreciation is an allocation not a valuation method. Depreciation expense does not measure changes in market value.
Business
2 answers:
Mariulka [41]3 years ago
8 0

Answer: Depreciation expense reflects the decrease in market value each year.

Explanation:

Depreciation is the decrease in the value of an asset due to the passage of time. Overtime, the value of machineries reduce as a result of usage. Depreciation is therefore the reduction in the value of assets. Depreciation is also the method used tin reallocating the cost of a tangible assets over its useful life span. Firms depreciate assets for accounting and tax purposes. The reduction in the value of an asset has am effect on the balance sheet of an entity.

The answer to the question is the second option. Depreciation does not have anything to do with the market value. Other options are correct except for the second option which states that depreciation expense reflects the decrease in market value each year.

goldfiish [28.3K]3 years ago
6 0

Answer:

The correct answer is letter "B": Depreciation expense reflects the decrease in market value each year.

Explanation:

In accounting, depreciation expense is a noncash expense that represents the cost of a company's fixed assets that are being used given a period. Depreciation expense is added to the net income amount in the Cash Flows Statement and is mainly calculated using the straight-line method.

Thus, <em>depreciation expense does not reflect the decrease in market value year after year.</em>

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Barclay Enterprises manufactures and sells three distinct styles of bicycles: the Youth model sells for $350 and has a unit cont
grandymaker [24]

Answer:

Break-even point in composite units = 811 units

Explanation:

Number of modal;

5 Youth models

9 Adult models

6 Recreational models

Annual fixed costs total = $6,550,000

Find:

Break-even point in composite units

Computation:

Mixed contribution margin = 5[130] + 9[475] + 6[525]

Mixed contribution margin = 650 + 4275 + 3150

Mixed contribution margin = $8075

Break-even point in composite units = Annual fixed costs total / Mixed contribution margin

Break-even point in composite units = 6,550,000 / 8075

Break-even point in composite units = 811 units

3 0
2 years ago
True or false?
IRISSAK [1]

Answer:

The statement is: True.

Explanation:

A competitive advantage is an advantage an individual, organization or country has over its competitors. That competitive advantage can be a comparative advantage when the entity has found a way to implement lower opportunity costs in its production process or a differential advantage if the firm provides a product or service with a unique feature difficult to replicate by competitors.

8 0
3 years ago
"Gamboa, Inc. sold 100 selfie sticks for $25 each. If the selfie sticks had an average cost of $1 to produce, how much profit di
IRISSAK [1]

Answer:

$2400

Explanation:

Average cost is the ratio of total cost of production to the total number of units produced, it is the sum of both the average fixed cost and the average variable cost. The average cost is given by the formula:

Average cost = Total cost / number of units.

Given that:

The total number of units produced = 100 selfie sticks, Average cost = $1 and Price of each selfie stick = $25

From Average cost = Total cost / number of units.

Substituting gibes:

$1 = Total cost / 100 selfie stick

Total cost = $1 × 100 = $100

Total cost = $100

Revenue = Price per item × Number of items

Revenue = $25 × 100 = $2500

Profit = Revenue - Total cost

Profit = $2500 - $100 = $2400

Total cost = $2400

5 0
3 years ago
The balance sheet above shows the financial situation for the Jamestown National Bank. The central bank has set a required reser
dedylja [7]

Answer: $40,000

Explanation:

Hello. Your question was incomplete as it lacked the balance sheet in question. Luckily I found it and have now attached it.

The question states that the central bank has set a required reserve ratio of 10%. This means that 10% of the deposits at the bank are not to be touched so they cannot loan past 90% of the deposits.

The bank has only $60,000 remaining to loan out as they will not sell their securities.

So we will calculate how much they can loan out thus,

= 60,000 - (200,000 * 10%) to find out what amount cannot be touched

= 60,000 - 20,000

= $40,000

The maximum amount of additional loans the bank in Jamestown can undertake is $40,000.

5 0
3 years ago
Portfolio diversification eliminates: Multiple Choice all investment risk. the portfolio risk premium. market risk. unsystematic
kaheart [24]

Answer:

Unsystematic risk

Explanation:

<em>The portfolio theory posits that the total risk on a collection of assets (i,e a portfolio) can be reduced by spreading the invested fund into different assets that are uncorrelated.</em>

<em>According to this model, the total risk on a portfolio is divided into systematic and unsystematic risks. The theory assumed by diversification, the unsystematic risk associated with a portfolio is eliminated.</em>

Unsystematic risk essentially are those unique individual assets for example. if we invest in company stock, risk associated with factors like bad management , law suit against a company, defect in company;s products are example of unique or systematic risks

7 0
3 years ago
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