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Nezavi [6.7K]
3 years ago
9

On January 1, 2018, Jay Company acquired all the outstanding ownership shares of Zee Company. In assessing Zee’s acquisition-dat

e fair values, Jay concluded that the carrying value of Zee’s long-term debt (8-year remaining life) was less than its fair value by $20,000. At December 31, 2018, Zee Company’s accounts show interest expense of $12,000 and long-term debt of $250,000. What amounts of interest expense and long-term debt should appear on the December 31, 2018, consolidated financial statements of Jay and its subsidiary Zee?
Business
1 answer:
raketka [301]3 years ago
5 0

Answer:

consolidated income statemnt interest expense: 14,500

net long-term debt consolidaded: 232,500

Explanation:

Jay thinks the long-term debt carries a discount.

Which makes the fair value 20,000 less, thus increasing hte interest expense.

amortization on discount: 20,000 / 8 = 2,500

interest expense in the consolidated statement:

12,000 + 2,500  = 14,500

adjusted balance ofthe discount: 20,00 - 2,500 = 17,500

long term debt: 250,000

discount on debt<u>  17,500 </u>

net                    232,500    

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Breakin Away Company has three employees—a consultant, a computer programmer, and an administrator. The following payroll inform
alekssr [168]

Answer:

Gross pay:

  • consultant $4,000
  • computer programmer $3,300
  • administrator $2,800

Net pay:

  • consultant $2,767.98
  • computer programmer $2,295.48
  • administrator $1,993.98

Explanation:

                                           regular earnings     overtime    withholding  

                                                                                              allowances

Consultant                        $4,000 per week       N/A                2

Computer programmer          $60 per hour        1.5                  1

Administrator                          $50 per hour          2                  2

computer programmer worked 50 hours = ($60 x 40) + ($60 x 10 x 1.5) = $3,300

administrator worked 48 hours = ($50 x 40) + ($50 x 8 x 2) = $2,800

Social security taxes:

  • Consultant = 6% x $4,000 = $240                        
  • Computer programmer = 6% x $3,300 = $198        
  • Administrator = 6% x $2,800 = $168

Medicare taxes:

  • Consultant = 1.5% x $4,000 = $60                        
  • Computer programmer = 1.5% x $3,300 = $49.50        
  • Administrator = 1.5% x $2,800 = $42

Federal income taxes:

  • Consultant: amount subject to withholding = $4,000 - (2 x $75) = $3,850. Federal income taxes = $356.90 + [28% x ($3,850 - $1,796) = $932.02                        
  • Computer programmer = amount subject to withholding = $3,300 - (1 x $75) = $3,225. Federal income taxes = $356.90 + [28% x ($3,225 - $1,796) = $757.02            
  • Administrator = amount subject to withholding = $2,800 - (2 x $75) = $2,650. Federal income taxes = $356.90 + [28% x ($2,650 - $1,796) = $596.02  

Gross pay:

  • consultant $4,000
  • computer programmer $3,300
  • administrator $2,800

Net pay:

  • consultant $4,000 - ($240 + $60 + $932.02) = $2,767.98
  • computer programmer $3,300 - ($198 + $49.50 + $757.02) = $2,295.48
  • administrator $2,800 - ($168 + $42 + $596.02) = $1,993.98
6 0
4 years ago
In the face of strong competition from Amazon, Walmart's 2016 acquisition of Jet. com was driven by a strategic objective, such
Nataly [62]

Answer:

The correct answer is E. In the face of strong competition from Amazon, Walmart's 2016 acquisition of Jet. com was driven by a strategic objective, such as reducing the number of strategic groups in the industry..

Explanation:

Walmart's purchase of Jet.com was purely and exclusively due to market strategy issues. Given the growth of Amazon, and in view of the digitization of consumption, Walmart decided to remove a medium-sized competitor like Jet.com from the market, that is, incorporating it into its business portfolio and making it a Walmart subsidiary. In this way, Walmart can carry out direct competition with Amazon, trying to prevent it from monopolizing the retail market.

7 0
3 years ago
Which of the following is not a factor of production?
vladimir1956 [14]

Hi there


The correct answer should be : C


I hope that's help:)

6 0
3 years ago
Customers arrive at Rent a Wreck and hope to score an inexpensive and unsightly vehicle to use for what typically is a short per
levacccp [35]

Answer: B- 6 minutes

Explanation: From the question above, In one hour, about 20 customers shows up at Rent a Wreck.

It takes 2 minutes to photocopy their driver's license and insurance card and take an impression of a credit card

therefore 20/2=10

in one hour which is 60 min = 60/10

=6 minutes

4 0
4 years ago
Assume that the price ceiling is set at 10 million dollars, that the quantity supplied at this price is 2 thousand jet planes, a
Jobisdone [24]

Answer:

since you didn't include the graph, I cannot tell what the producer surplus area will be on the graph, but I can calculate total producer surplus in $:

total producer surplus = (actual price - minimum price that a producer is willing to accept) x total quantity supplied

  • actual price = $10 million
  • minimum price = $2 million
  • quantity supplied = 2 million units

total producer surplus = ($10 million - $2 million) x 2,000 jet planes = $8 million x 2,000 jet planes = $16,000 million

5 0
3 years ago
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