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Leona [35]
3 years ago
5

For each of the following items, indicate by using the appropriate code letter, how the item should be reported in the statement

of cash flows, using the indirect method.
A. Added to net income
B. Deducted from net income
C. Cash outflow—investing activity
D. Cash inflow—investing activity
E. Cash outflow—financing activity
F. Cash inflow—financing activity
G. Significant noncash investing and financing activity
____ 1. Decrease in accounts payable during a period
____ 2. Declaration and payment of a cash dividend.
____ 3. Loss on sale of land.
____ 4. Decrease in accounts receivable during a period.
____ 5. Redemption of bonds for cash.
____ 6. Proceeds from sale of equipment at book value.
____ 7. Issuance of common stock for cash.
____ 8. Purchase of a building for cash.
____ 9. Acquisition of land in exchange for common stock.
____ 10. Increase in merchandise inventory during a period
Business
1 answer:
Y_Kistochka [10]3 years ago
8 0

Answer:

1. Decrease in accounts payable during a period - Deducted from net income  (B)

2. Declaration and payment of a cash dividend - Cash outflow (financing activity ) (E)

3. Loss on disposal of land - Added to net income (A)

4. Decrease in accounts receivable during a period -  Added to net income (A)

5. Redemption of bonds for cash - Cash outflow (financing activity)  (E)

6. Proceeds from sale of equipment at book value - Cash inflow (investing activity ) (D)

7. Issuance of common stock for cash - Cash inflow (financing activity)  (F)

8. Purchase of a building for cash - Cash outflow(investing activity ) (C)

9. Acquisition of land in exchange for common stock - Significant non-cash (investing and financing activity ) (G)

10. Increase in inventory during a period - Deducted from net income (B)

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Grady is a member of a large family and received the following payments this year. For each payment, determine whether the payme
diamong [38]

Answer:

a. This is a realized income. Amount to be included in his gross income is $0.

b. This is a realized income. Amount to be included in his gross income is $0.

c. This is a realized income. Amount of gift of bond to include in Glady's gross income is $0. Amount of interest from the bonds to be included in his gross income is $0.

d. This is NOT a realized income. Amount to be included in his gross income is $0.

Explanation:

a. A gift of $30,600 from Grady’s grandfather. Amount to be included?

The $30,600 is categorized as a realized income. However, no part of the total amount of any gift will be included in the gross income.

Therefore, amount to be included Glagy's gross income is $0.

b. 680 shares of GM stock worth $282 per share inherited from Grady’s uncle. The uncle purchased the shares for $82 each, and the shares are worth $287 at year-end. Amount to be included?

This amount of inheritance is categorized a realized income. However, they are not to be included as part of the gross income.

Although the there is an increase in the share value from $82 to $287, but the increased value will still not be included in the gross income because it has not been realized.

Therefore, amount to be included Glagy's gross income is $0.

c. A gift of $53,000 of Ford Motor Bonds. Grady received the bonds on October 31, and he received $1,590 of semiannual interest from the bonds on December 31. Amount to be included for gift motor bonds? Amount to be included for interest from the bonds?

This gift of bond is categorized as a realized income. However, they are not to be included as part of the gross income.

The amount of interest that accrued till October 31 will not be included in the gross income because it is considered as part of the gift as it was an interest that accrued when the bond gift was given.

The $530 [i.e ($1,590 / 6 months) * 2 months] that accrued from November 1 to December 31 (i.e. 2 months) will be taxed because it accrued after the day the gift was given. But this is an accrued interest that has not been received. It will therefore not be included in the gross income but it will be taxed when it is received.

The amount of gift of bond = $53,000 + [($1,590 / 6 months) * 4 months] = $53,000 + $1,060 = $54,060.

Amount of accrued interest from the bonds = ($1,590 / 6 months) * 2 months = $530.

However, amount of gift of bond and interest from the bonds to be included in Glady's gross income is $0.

d. A loan of $7,200 for school expenses from Grady’s aunt. Amount to be included?

A genuine loan does not fall under the category of a realiszed income. However, there are situations whereby a loan can be a a disguised gift. Under this situation, the loan would be considered as a gift and then becomes a realized income. However, the value of the gift will not be included in the gross income.

For this qustion, the loan is considered a genuine loan and it not a realized income. Therefore, the amount to be included Glagy's gross income is $0.

8 0
3 years ago
Based on the Information that follows, prepare the cost of goods sold section of a multiple-step income statement.
Shtirlitz [24]

Answer:

Cost of goods sold = $105,060

Explanation:

a) Data and Calculations:

Cost of goods sold section of the multi-step income statement:

Merchandise Inventory, January 1, 20--       $37,000

Purchases                                                       102,000

Purchases Returns and Allowances               (4,200)

Purchases Discounts                                       (2,040)

Freight-In                                                              800

Merchandise Inventory, December 31, 20--(28,500)

Cost of goods sold                                     $105,060

b) The cost of goods sold comprises the beginning inventory, purchases and freight-in costs incurred during the period, less purchases returns and discounts, and the ending inventory.  It represents the cost incurred directly for the goods sold.  This means that indirect costs are not included in the cost of goods sold.  Such costs are usually deducted as period costs before arriving at the net income.

7 0
3 years ago
So its customers would not be lured by its competitors, wendy's decided to offer a 99-cent value menu to compete with the value
Alexandra [31]
This is an example of COMPETITION element of the immediate environment. 
In marketing, there are three elements of  consumers' immediate environment, these are: company, competition and corporate partners. These three elements works together and directly determine the performance of a company in a particular place. In the scenario given in the question, Wendy decided to offer the 99 cent value menu purposely to attract more consumers than its competitors.
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Which of the following is TRUE? " When a market price allocates resources, everyone who is able to pay the price gets the resour
sladkih [1.3K]

Answer: When a market price allocates resources, everyone who is able to pay the price gets the resource.

Explanation:

The market allocates prices to goods and services based on the scarcity of the said goods and services. This means that regardless of how scarce a good is, you can get it if you are willing to pay the price that it is being offered at.

For instance, if the price of tomatoes suddenly went up from $4 to $12 per pack, it means that tomatoes are now more scarce and not many people can afford it. If you can afford that $12 however, you will be able to get the tomatoes despite how scarce it is.

7 0
3 years ago
What is the purpose of a letter-writing campaign conducted by a group of consumers?
Dafna1 [17]

To be able to get a company to voluntarily change its business practices a group of consumer should conduct a letter writing campaign. Through this advocacy tool, the citizens will have an easy way to voice opinions about certain issues.





7 0
3 years ago
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