Answer:
$190,494.01
Explanation:
The calculation of net present value is given below:-
Perpetual cash flow $435,000
Less: Cash cost $310,000
Earning before interest
and tax $125,000
($435,000 - $310,000)
Less: Interest on debt $18,250
($250,000 × 7.3%)
Earning before tax $106,750
($125,000 - $18,250)
Less: Tax $37,362.50
($106,750 × 35%)
Net Income $69,387.50
($106,750 - $37,362.50)
Present value $415,494.01
($69,387.50 ÷ 16.7%)
Less: Initial cost $225,000
($475,000 - $250,000)
Net present value $190,494.01
( $415,494.01 - $225,000)
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Answer:
Dr Account receivable $65,940
Cr Sales Revenue $62,800
Cr Sales tax payable $3,140
Explanation:
Sales of merchandise inventory on account
Dr Account receivable $65,940
Cr Sales Revenue $62,800
Cr Sales tax payable $3,140
Sales tax payable = Sales Revenue × Sales tax percentage
$62,800×5%
=$3,140
Amount of account receivable
Account receivable = Sales Revenue + Sales tax payable
$62,800+ $3,140
=$65,940
Answer and Explanation:
The preparation of the operating activities section of the statement of cash flows for the year ended December 31, 2020 is presented below;
Cash flow from operating activities
Net income $1,580,000
Add: depreciation expense $58,970
Add: decrease in account receivable $313,770
Less: Increase in prepaid expense -$167,640
Less: Decrease in account payable -$279,000
Less: decrease in accrued expense payable -$124,020
Add: Decrease in inventory $380,000 ($1,880,000 - $1,500,000)
Cash flow provided by operating activities $1,762,080
Answer:
The correct answer is a. production points outside the production possibility frontier are unattainable
Explanation:
Production possibility frontier graph is attached.
The production possibility frontier shows the possibilities of trade off between two products. The trade off in this frontier use all the resources available. So it is impossible to reach a point outside the frontier, there are not enough resources.
