Answer:
Lets shape the question so it makes some sense.
<em>Warranty costs amounting $500,000 were recorded in 2018 Income statement. However, the warranty tax deduction is not allowed until payment occurs in future years. Disscuss accouting implication</em>
See detail answer below.
Explanation:
As per tax laws warranty provision is not allowed as deductible expense only warranty cost incured/paid during the year is allowed deduction when computing taxable income.
So the company shall recoginze defferd tax asset for this expense in current year. Following entries will be made by the company for financial accounting purpose.
Deffered Tax Asset Debit $125000
Deffered Tax Income $125000
(Assuming applicable tax rates is 25%)
The next year when the warranty claim will be incured/paid the company will reverse the above entry and can claim tax deduction against this waranty cost paid but not on provision basis.
Answer: 3
Explanation:
The marginal rate of substitution simply means the rate at which one good will be exchanged for another good based on the current market price.
Since you like servants three times as much as robots, this implies that the utility that one gets from one servant is exactly like the utility that will be gotten from three robots.
Therefore, the utility function will be:
U = 3X + Y
Then, the marginal rate of substitution will be:
= MUX/MUY
= 3
Answer:
c) the marginal cost of capital
Explanation:
The cost which a company bears to add one dollar / unit of capital is called marginal cost. We know that the company raise funds through different sources which can be debt from banks and stocks (common and preferred). This process of raising capital involves a cost which is termed as marginal cost of capital or the cost required to raise an additional unit of capital.
This would be a case of insider trading, meaning that the trader (the financial advisor) has information that is not public that will affect the future performance of the company. If the advisor acts on this early information and profits, then this could be considered illegal.
