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scZoUnD [109]
3 years ago
13

Jing Company was started on January 1, Year 1 when it issued common stock for $28,000 cash. Also, on January 1, Year 1 the compa

ny purchased office equipment that cost $15,200 cash. The equipment was delivered under terms FOB shipping point, and transportation cost was $1300. The equipment had a five-year useful life and a $5700 expected salvage value. Assume that Jing Company earned $17,400 cash revenue and incurred $11,000 in cash expenses in Year 3. Using straight-line depreciation and assuming that the office equipment was sold on December 31, Year 3 for $8900, the amount of net income or (loss) appearing on the December 31, Year 3 income statement would be:
Business
1 answer:
denpristay [2]3 years ago
6 0

Answer:

5,280 net income for the Year 3

Explanation:

This would be the situation:

17,400 revenue

11,000 expenses

gain/loss on sale of equipment

= net income year 3

To know the result of the sale of equipment we have to do

sales price - book value = gain/loss on sale of equipment

8900         -  book value   = gain/loss

We have to determinate the book value.

book value = adquisition cost - acumulated depreciation

The equipment cost 15,200 + 1,300 transportation cost = <u>16,500 Adquisition Cost</u>

acumulated depreciation = depreciation per year * 3 years

and depreciation per year is:

\ $ depreciation per year $= \frac{Adquisition Value - Salvage Value }{Useful Life}

Here we have all the values, so we stop digging and start solving.

  • <em>depreciation </em>= (16,500-5,700)/5 = 2,160
  • <em>acumulated depreciation</em> = 2,160 * 3 = 6,480
  • <em>book value</em> = 16,500 - 6,480 = 10,020
  • <em>gain/loss </em>= 8,900 - 10,020 = -1,120 LOSS on sale of Equipment

net income = 17,400 - 11,000 - 1,120 = 5,280 net income for the Year 3

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Answer:

<u>the trend of more Latino immigration </u>

Explanation:

The stores have identified a market opportunity because of the increase in Latino immigrants in Boston, Massachusetts.

Note that when a significant amount of a population come from a certain ethnic group, demand for ethnic products is more likely to increase. Thus, this has made Marco feel very much at home.

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What's your question I don't understand
6 0
3 years ago
Detailed information about the financial statement elements is maintained in records commonly called?
sergij07 [2.7K]

Detailed information about the financial statement elements is maintained in records commonly called "Accounts'

An account in accounting is a general ledger entry that is used to categorize and record transactions. For example, businesses will have a Cash account where they may record each transaction that raises or reduces the amount of cash they have on hand.

Three different accounts exist.

  1. Real account: It links assets and obligations; it excludes accounts for specific individuals. They continue every year.
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4 0
2 years ago
A proposed new project has projected sales of $132,000, costs of $66,000, and depreciation of $13,500. The tax rate is 30%. Calc
Verizon [17]

Answer:Operating cash flow $ _50,250__

Yes, the answer is same in each case

Explanation:

a)   EBIT + Depreciation - Tax

= ($132,000-$66,000-$13,500) + $13,500 - Tax

= $52,500 + $13,500-(30% x $52,500)

=$52,500 + $13,500-15,750

EBIT + Depreciation - Tax=$50,250

b)Top down OCF = EBIT - (EBIT x Tax) + Depreciation  

Top down OCF = $52,500  - ($52,500 x 30%) +  $13,500  

Top down OCF = $52,500 -15,750 + $13,500

Top down OCF =$50,250

Tax shield OCF =(Sales - Cost)(1-t) + Depreciation (t)

Tax shield OCF = ($132,000-$66,000) (1-0.30) + ($13,500 x0.30)  

Tax shield OCF =$66,000 x 0.7 + 4,050

Tax shield OCF = 46,200+ 4,050

Tax shield OCF = $50,250

Bottom Up OCF = Net Income + Dep

Bottom Up OCF =($132,000-$66,000-$13,500 ) - Tax ) + Dep

Bottom Up OCF = $52,500-(0.3 x $52,500 )+ $13,500

Bottom Up OCF = $52,500 -15,750 + $13,500

Bottom Up OCF =$50,250

2. Yes, the answer is same in each case

4 0
3 years ago
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