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xeze [42]
3 years ago
13

PrintItem 4Item 4 On November 8, 2018, Power Corp. sold land to Wood Co., its wholly owned subsidiary. The land cost $61,500 and

was sold to Wood for $89,000. For consolidated financial statement reporting purposes, when must the gain on the sale of the land be recognized?
Business
1 answer:
IRISSAK [1]3 years ago
3 0

Answer: When Wood Co. sells the land to a third party.

Explanation: As stated in the question, Wood Co. who purchased the land is a subsidiary of the seller, Power Corp., the parent company. In a consolidated financial statement whereby financial reports of all entities, subsidiaries and all financial attachment of a corporate establishment is accounted for.

Power Corp. owns the entirety of Woods Co. and therefore during a consolidated financial statement reporting, the profit made by Power Corp. from the sale of the land must be recorded when the land is purchased from Woods Co. by a third party.

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Losing a customer once means losing the entire stream of possible purchases that the customer would make over an extended period
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Answer: (D) Customer lifetime value  

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5 0
3 years ago
What should he do to get to the appropriate cell?
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Over the past five years, Teen Clothing stock produced returns of 18.7, 5.8, 7.9, 10.8, and 11.6 percent,respectively. For the s
Alexandra [31]

Answer:

The correct answer is  C. 7.22 percent

Explanation:

To find the arithmetic risk premium for the 5 year period, the formula is

Average risk premium for the period =  Sum of risk premium for each year /  number of years = ∑ra(i) - rf(i) / n

ra = asset or investment return / 100

rf = risk free return / 100

Where i represents each year.

Sum of risk premium for each year = (0.187 - 0.052) + (0.058 - 0.034) + (0.079 - 0.028) + (0.108 - 0.034) + (0.116 - 0.039) = 0.361

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8 0
2 years ago
On Monday morning you sell one June T-bond futures contract at 97:27, that is, for $97,843.75. The contract's face value is $100
sergij07 [2.7K]

Answer:

Please find the detailed answer as follows

Explanation:

The case is pretty simple, and I’ll to be simple in explanation below:

Facts:  

--Transfer price per unit should be atleast equal to the relevant cost per unit.

--Relevant cost per unit = Variable cost per unit + Contribution margin lost + Avoidable fixed cost.

--Since it is stated that fixed cost wont be affected and that there is idle capacity available, there wont be any ‘Contribution margin lost’ on outside sale AND ‘avoidable fixed cost.  

--If Division A transfers, it would transfer at the relevant cost of $ 19 per unit, which is equal to the variable cost per unit.  

--If Division A didn’t transfer, Division B will buy from outside at rate of $ 24 per unit.

Hence, Division B will purchase $ 24 per unit when it could get from Division A at $ 19.

Thereby, Division will be paying $ 5 per unit extra on 16100 units.

Division B and hence, the company as a whole will be WORSE by $ 80,500

[16100 units x $ 5 per unit]

Correct Answer = Option #3: Worse off by $ 80,500 each period.

The same is illustrated as attached image.

Download xlsx
7 0
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