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Marysya12 [62]
3 years ago
12

Kwik taxi service uses the units-of-activity method in computing depreciation on its taxicabs. Each cab is expected to be driven

140,000 miles. Taxi 10 cost $24,300 and is expected to have a salvage value of $700. Taxi 10 was driven 28,000 miles in 2016 and 33,000 miles in 2017. a) determine the depreciation cost. b) compute the depreciation expense for each year.
Business
1 answer:
zimovet [89]3 years ago
6 0

Answer:

Explanation:

Depreciation cost :

2016: <u> expected useful life</u>

           Cost - salvage value       X    usage

= <u>140,000</u>

24,300-700

=5.93*28,000 = $166,101.69

2017:  <u>expected useful life</u>

           Cost - salvage value       X    usage

= <u>140,000</u>

24,300-700

=5.93*33,000 = $195,762.71

Depreciation Expense:

2016:<u> (cost-salvage value)*actual activity performed</u>

             total estimated useful life

= <u>(24,300-700)*28,000</u>

          140,000

=$4,720

2017: <u>(cost-salvage value)*actual activity performed</u>

             total estimated useful life

= <u>(24,300-700)*33,000</u>

          140,000

=$5,562.86

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The purposes of the statement of cash flows are to A. predict future cash flows. B. evaluate management decisions. C. determine
Temka [501]

Answer:

D. All of the above

Explanation:

A statement of cash flows is also known as cash flow statement and it is a financial statement which is used to illustrate how changes in income and various account of the balance sheet affect cash and cash equivalents.

The statement of cash flows is also used by financial experts or accountants to breakdown the cash-flow analysis into;

1. Cash-flow from operating activities: it represents cash-flow and transactions from operational business activities such as employee salary, sales of goods etc.

2. Cash-flow from investing activities: it represents the cash flow from investment such as proceeds from the sale of plant, equipments etc.

3. Cash-flow from financing activities: it represents the cash flow from debt or equity. Basically, the costs used in a financing a business.

<em>The purposes of the statement of cash flows are to;</em>

A. Predict future cash flows.

B. Evaluate management decisions.

C. Determine ability to pay debts and dividends.  

4 0
3 years ago
Yoshi operates a shoe store as a sole proprietorship. However, he is in poor health and may be unable to continue running the bu
Shalnov [3]

Answer:

A. ceases to exist unless sold or taken over by Yoshi's heirs. 

Explanation:

A sole proprietorship is a from of business which is owned by one person. The owner is usually the decision maker.

One of the disadvantages of sole proprietorship is lack of continuity. The business usually ends when the owner dies. Although , family members can take over running the business.

I hope my answer helps you.

6 0
2 years ago
On January 1, 2012, Albert invested $6,000 at 8 percent interest per year for three years. The CPI (times 100) on January 1, 201
qaws [65]

Answer:

Inflation in 2012:

=\frac{CPI\ 2013 - CPI\ 2012}{CPI\ 2012}

=\frac{110 - 100}{100}

= 10%

Inflation in 2013:

=\frac{CPI\ 2014 - CPI\ 2013}{CPI\ 2013}

=\frac{120 - 110}{110}

= 9.09%

Inflation in 2014:

=\frac{CPI\ 2015 - CPI\ 2014}{CPI\ 2014}

=\frac{126 - 120}{120}

= 5%

Real rate of interest = Nominal - inflation

Given that,

Nominal rate = 8%

Therefore,

Real interest rate is as follows:

2012:

= 8% - 10%

= -2%

2013:

= 8% - 9.09%

= -1.09%

2014:

= 8% - 5%

= 3%

$6000 at 8% grows to:

= 1000 × 1.08

= $6,480 in one year

which is invested again to grow to $6,998.4 in two years

which is invested again to grow to $7,558.272 in three years

so,

Total gain:

=\frac{7,558.272-6,000}{6000}\times100

= 25.9712%

The price level increases in three years by:

=\frac{CPI\ 2015 - CPI\ 2012}{CPI\ 2012}\times 100

=\frac{126 - 100}{100}\times 100

= 26%

So,

Total real rate of return:

= Total gain - Percentage increase in prices

= 25.9712 - 26

= -0.0288%

5 0
3 years ago
Allstar Exposure designs and sells advertising services to small, relatively unknown companies. Last month, Allstar had sales co
Mariana [72]

Answer:

1. Prepare an income statement for Allstar for the past month.

The income statement is given below.

Sales                              $ 410,000

Commission Cost          ($ 50,000)

Technology Cost           ($ 75,000)

R/D Cost*                       ($ 200,000)

Selling expenses             ($ 10,000)

Admin expenses             ($ 35,000)

Net profit                          $ 40,000

* In absence of information it is assumed that research and development costs of $200,000 meet defination of expense as per accounting standard (IAS 38).

2. Briefly explain why Allstar's income statement has no line for cost of goods sold.

As per question Allstars is a service oriented company. In services oriented company there is no good that company is manufacturing and selling. So there will not be any cost of good sold line item in income statement.

6 0
3 years ago
Read 2 more answers
You are hoping to buy a new boat 3 years from now, and you plan to save $5,800 per year, beginning one year from today. You will
sweet-ann [11.9K]

Answer:

FV= $17,701.6

Explanation:

Giving the following information:

Annual deposit (A)= $5,800

Interest rate (i)= 5.2%

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<u></u>

FV= {A*[(1+i)^n-1]}/i

A= annual deposit

FV= {5,800*[(1.052^2) - 1]} / 0.052 + 5,800

FV= $17,701.6

3 0
3 years ago
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