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il63 [147K]
3 years ago
7

Amble, Inc. exchanged a truck with a carrying amount of $12,000 and a fair value of $20,000 for a truck and $5,000 cash. The fai

r value of the truck received was $15,000.
At what amount should Amble record the truck received in the exchange assuming the exchange lacks commercial substance?
A. $7,000
B. $9,000
C. $12,000
D. $15,000
Business
1 answer:
katrin [286]3 years ago
4 0

Answer & Explanation:

The fair value of our asset is $20000 and what we receive is a truck with $15000 market value and $5000 cash. So the transaction possesses commercial substance as the fair value and value received are same.

So assume if the transaction lacks the commercial substance (according to question) then the truck received must be recorded at fair value and must be offset against the truck which is exchanged for. The entry would be:

Dr Truck received @ Fair Value $15000

Cr                     Truck Sold                      $12000

Cr                     Profit on Disposal           $8000

The above entry makes it clear that the entry to recognize the truck would be $15000. So the option D is correct.

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On January 1, Year 1, Chaco Company sold $300,000 of 10% twenty-year bonds. Interest is payable semiannually on June 30 and Dece
Andrei [34K]

Answer:

The amount of effective interest expense that chaco will record in the first six months is $14,375

Explanation:

interest payment that will be first made is on June 30, Year 1. Therefore, the outstanding balance used in the calculation is the issue price.

The interest expense is calculated by these formula

Interest expense = Effective semiannual interest rate × Outstanding balance

Interest expense = (8% ÷ 2) × $359,378 = $14,375

So the interest expense is gotten as %14,375

8 0
3 years ago
Read 2 more answers
Natasha has a big decision to make—she could either spend spring break at the beach with her friends or spend it volunteering to
vagabundo [1.1K]

Answer:

Natasha just participated in crowd sourcing.

Explanation:

Natasha had to employ the practice of obtaining information or the input of the wider public or people via the internet to come to a conclusion on the decision to make.

4 0
3 years ago
Read 2 more answers
If the technology, the nature of competition, or the regulatory environment changes in an industry, then: Question 2 options: or
hoa [83]

Answer:

the appropriate organizational architecture will change too.

Explanation:

Technology can be defined as a branch of knowledge which typically involves the process of applying, creating and managing practical or scientific knowledge to solve problems and improve human life. Technologies are applied to many fields in the world such as medicine, information technology, cybersecurity, engineering, environmental etc.

If the technology, the nature of competition, or the regulatory environment changes in an industry, then the appropriate organizational architecture will change too. This is so because the organizational architecture is required to be flexible and adaptive to most external and internal factors that affects the organization.

Hence, an organizational architecture that isn't adaptive to changes wouldn't be able to compete with other rival organizations in the same industry and as such would be running at a loss and subsequently, go bankrupt.

6 0
3 years ago
G's Flowers pays an annual dividend that increases by 1.8 percent per year, commands a market rate of return of 13.8 percent, an
GenaCL600 [577]

Answer:

$2.28

Explanation:

G's flower pay an annual dividend that increase by 1.8%

= 1.8/100

= 0.018

The market rate of return is 13.8%.

= 13.8/100

= 0.138

The price is $19.08 per share

Therefore the expected amount of the next dividend can be calculated as follows

= 19.08= D1/(0.138-0.018)

19.08= D1/0.12

D1= 0.12×19.08

D1= $2.28

Hence the expected amount for the next dividend is $2.28

7 0
3 years ago
Suppose you deposited $2,000 in a savings account. If you have $2,600 in the account after 4 years, what interest rate did you e
Slav-nsk [51]

Answer:

6.78% per year.

Explanation:

Assuming compounding occurs only once a year, the interest rate 'r' required on a $2,000 investment for 4 years to yield $2,600 is determined by:

FV = PV*(1+r)^n\\2,600 = 2,000*(1+r)^4\\r=\sqrt[4]{\frac{2,600}{2,000}}-1\\ r=0.06779=6.78\%

The interest rate earned on those savings was 6.78% per year.

6 0
3 years ago
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