Answer:
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Explanation:
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<h2>
Cost of goods sold of Baxter's Company = 3,06,000</h2>
Explanation:
Cost of goods sold = +Purchase + Direct Exp+ Opening Inventory - Closing Stock
85,000 + 3,23,000 - 1,02,000 = 3,06,000
So, doing the calculations, Marion's had $700,000-240,000=$460,000-160,000 in expenses = $300,000 x 0.4 income tax=120,000 and so 300,000-120,000=$180,000 net value. Preston's had $700,000-40,000 depreciation=$660,000-160,000 expenses =$500,000 x 0.4 taxes= 200,000 taxes so 500,000-200,000=$300,000 net value. The result is Preston's had less depreciation which provided it with more spendable income.
Answer:
Bonds Payable $1000000 Dr
Gain on redemption $15000 Cr
Discount on bonds Payable $10000 Cr
Cash $975000 Cr
Explanation:
The face value of bonds payable is $1000000 while they are a discount bond and carry a discount of $10000. The value of bonds is 1000000 - 10000 = 990000.
The bonds, however, are redeemed at 97.5 which means they are redeemed by paying 97.5% of face value which comes out to be 975000.
Thus, the difference between their value and the redemption price is the gain as value is greater than the price paid for them at redemption.
Gain = 990000 - 975000 = $15000
