Answer:
C. Expense $300 of the expense on the income statement.
Explanation:
The correct answer is C.
On 31 December 2016, Sengal Company should report Rent expense of $300 on the income statement.
The initial journal entry was:
Dr Prepaid rent $1, 200
Cr Cash $1, 200
This journal entry recognizes the prepaid rent as an asset to the company because the rent is paid in advance, and they have not yet made use of the property they are renting. The payment is an annual payment, meaning that it is for 12 months. Assuming that the end of the financial year is at 31 December 2016, we know that a portion of the $1, 200 is in excess.
The monthly rent expense is $1,200 / 12 = $100. This means that only $100 is the expense for each month. By 31 December, only $300 was the rent expense. [ $100 x 3]. Sengal Company had paid $900 [$1, 200 - $300] in advance and that $900 was to remain as an asset (prepaid rent). The $300 should be recorded as an expense in the income statement and removed as an asset from the balance sheet.
The subsequent journal entry to record the expense is:
Dr Rent expense $300
Cr Prepaid rent $300
At the end of the financial year [31 December 2016], all income statement accounts must be correctly accounted for. This is because all income and expenses are closed of at year end and are not carried forward into the next financial year. This is according to the GAAP principle of ‘Matching’ which states that all income and expenses should be matched to the correct year in which they occur.
Answer: $13,200
Explanation:
Given that,
Contributing to a traditional IRA = 7 years
Total in account = $30,000
Withdrawal from IRA to help pay for the car = $20,000
marginal tax bracket = 24 percent
Therefore,
After tax withdrawal:
= Withdraws - 10% penalty as per IRS for early withdrawal - 24% tax on $20,000
= $20,000 - 0.1 × 20,000 - 0.24 × 20,000
= $20,000 - 2,000 - 4,800
= $13,200
Answer:
The correct answer is letter "B": a shift to the right of the supply curve for A.
Explanation:
According to the supply law, when the quantity supplied of a good increase, so will the price for that good. This will also cause that the supply curve shifts to the right. Then, technological improvements are likely to boost production which implies manufacturing more products, thus, increasing supply.
So, <em>the introduction of technologies in the production of good A will shift the supply curve of A rightwards.</em>
Answer:
a. Producer surplus
b. Neither
c. Consumer surplus
Explanation:
The producer surplus is the difference between the minimum price a producer is willing to accept for a product and the price he actually gets.
The consumer surplus is the difference between the maximum price a consumer is willing to pay for a product and the price he actually gets.
a. Here, the person gets $189 for his laptop but he was willing to accept $180 as well. This is an example of producer surplus. The producer surplus, in this case, is $9.
b. In this example, we only know the price that the producer actually received and the price the consumer actually paid. The maximum price the consumer was willing to pay or the minimum price that the producer was willing to accept is not mentioned. So this is neither an example of producer surplus nor consumer surplus.
c. Here, the consumer was willing to pay $47 for a sweater, but he actually has to pay $40. This is an example of consumer surplus. The consumer surplus is equal to $7.
Answer:
Ending inventory= $916.2
Explanation:
Giving the following information:
Nov. 1 Inventory: 35 units $7.10 each
Nov. 8 Purchase: 142 units $7.60 each
Nov. 17 Purchase: 71 units $7.45 each
Nov. 25 Purchase: 106 units $7.80 each
Nov. 30 ending inventory: 118 units on hand. FIFO (first-in, first-out)
Ending inventory= 106*7.8+12*7.45= $916.2
