When using absorption costing when production is greater than sales, a portion of fixed overhead is allocated to ending inventory.
Production is the process of combining diverse material and immaterial inputs to create a consumable good or service. It is the process of producing something of worth, goods, or assistance that benefits a person.
Manufacturing is the process of creating items or goods out of components or raw materials. To put it another way, manufacturing employs inputs to produce outputs fit for consumption, i.e., things or products that are valuable to the consumer or end-user. The creation of furniture is an illustration of production. Harvesting corn for food is an illustration of production. Corn production is an illustration of production.
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Answer:
The Journal Entry is shown below in the explanation section
Explanation:
The first step to take is to make use of the Journal entry.
Journal Entries for issuing Bonds
1 May Cash 800,000
Bonds Payable 800,000
1 Nov Interest expense 24,000
Cash 24,000
(800,000* 6%*6/12)
31 Dec Interest expense 8000
Interest Payable 8000
(800,000* 6%* 2/12)
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Answer:
Yes, small changes in the assumptions pertaining to the estimation of the terminal value have a significant impact on the calculation of the total value of the target firm.
Explanation:
Terminal value is dependent on the input used in the valuation and the two inputs which heavily influence the value of enterprise are future growth projection and discount rate.
Accurately projecting the future cash flow can be a doubting task and can result in a degree of uncertainty built into estimate.
Small changes in the assumptions pertaining to the estimation of the terminal value have a significant impact on the calculation of the total value of the target firm. This is because, it is these small changes in the stable growth rate can change the terminal value significantly and the effect gets larger as the growth rate approaches the rate used in the estimation of the total value of the target firm.