1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
White raven [17]
3 years ago
12

On June 30, 2021, the Esquire Company sold some merchandise to a customer for $68,000. In payment, Esquire agreed to accept a 9%

note requiring the payment of interest and principal on March 31, 2022. The 9% rate is appropriate in this situation. Required: 1. Prepare journal entries to record the sale of merchandise (omit any entry that might be required for the cost of the goods sold), the December 31, 2021 interest accrual, and the March 31, 2022 collection. (Do not round intermediate calculations.) 2. If the December 31 adjusting entry for the interest accrual is not prepared, by how much will income before income taxes be over-or understated in 2021 and 2022
Business
1 answer:
weeeeeb [17]3 years ago
6 0

Answer:

2021 understated by $3,060

2022 overstated by $3,060

Explanation:

<u>June 30, 2021</u>

                                        DEBIT          CREDIT

Note receivable            $68,000

Sales                                                    $68,000

<u>Dec 31, 2021</u> (July 1, 2021 to Dec 31 2021)

                                        DEBIT          CREDIT

Interest receivable       $3060

Interest Income                                   $3060

Working = 68,000 x 9% x6/12 = $3060

<u>March 31, 2022</u>  

                                        DEBIT          CREDIT

Cash                             72,590  

Interest receivable                              3,060

Interest income                                    1,530

Note Receivable                                   68,000

Working = 68000 x 9% x 3/12 =          1,530

2021 income will be understated by $3,060 if adjusting entry is not prepared and revenue is not recognized

2022 income will be overstated by $3,060

You might be interested in
A firm has conducted market research and found that customer satisfaction with its product is quite high. Nonetheless, repurchas
VladimirAG [237]

The research design evidently has  a problem with  <u>"validity".</u>


Validity refers to how well a logical test or bit of research really allots what it sets to, or how well it mirrors the truth it professes to speak to. Like reliability, validity in this sense is an idea drawn from the positivist logical convention and necessities particular understanding and utilization with regards to qualitative research.  

8 0
3 years ago
A depreciable asset has an estimated 15 percent salvage value. At the end of its estimated useful life, the accumulated deprecia
8090 [49]

Answer:

B

Explanation:

Depreciation is the uniform decrease in the value of an asset over a period until the salvage value is reached.

It is given by :

Annual depreciation expense = (cost of asset - salvage)÷ useful life of the asset

Therefore the accumulated depreciation would not equal the original cost of the asset at the end of its estimated useful life because the salvage value will be deducted from cost of asset under declining-Balance.

7 0
3 years ago
Siva, Inc., imposes a payback cutoff of three years for its international investment projects. Year Cash Flow (A) Cash Flow (B)
Digiron [165]

Answer:

The payback period for Silva Inc. is 3 years. If considering only this method of evaluating projects, Silva Inc will invest in project A and dismiss project B.  

Payback period A=2,1539 years.

Payback period B= 3,0042 years

Explanation:

The payback period refers to the amount of time it takes to recover the cost of an investment. The payback period is the length of time an investment reaches a breakeven point.

<u>Cash Flow A:</u>

                $

I0= - 70.000

1=     28000 =    -42000

2=    38000 =    -4000

3=     26000 =    22000

Payback period= full years until recovery +

                             unrecovered cost beginning year/Cashflow  during year

Payback period A= 2  + (4000/26000)= 2,1539 years.

<u>Cash Flow B:</u>

                $

I0=   -80000

1=       20000 =   -60000

2=       23000 =   -37000

3=       36000 =    -1000

4=       240000 =   239000

Payback period B= 3 + 1000/240000= 3,0042 years

<u>The payback period for Silva Inc. is 3 years. If considering only this method of evaluating projects, Silva Inc will invest in project A and dismiss project B.  </u>

<u></u>

7 0
3 years ago
Which of the following is a major difference between the​ AD-AS model and the dynamic​ AD-AS model? The dynamic​ AD-AS model ass
const2013 [10]

Answer:

D

  • Potential GDP increases​ continually, while the​ AD-AS model assumes the LRAS does not change.

5 0
3 years ago
Gillian is easily impressed by make-up which claims to be manufactured with the use of crystals, but without really wondering ab
Ivan

Answer:

Corpus Callosum

Explanation:

A large bundle of axon fibers. Connects left and right sides of brain. Thickens during adolescence, increasing ability to process information.

5 0
3 years ago
Read 2 more answers
Other questions:
  • Financing options for post-secondary education:
    8·1 answer
  • Raul is a financial analyst who oversees the daily financial expenditures for a major big box retailer. on a typical day, raul d
    12·1 answer
  • On January 1, Year 1, Abbott Company granted 92,000 stock options to certain executives. The options are exercisable no sooner t
    7·1 answer
  • For a bank, when a person deposits money into the bank, this: a creates a liability and an asset for the bank. b creates a liabi
    12·1 answer
  • You have just started a new business. You need to have three to four workstations available for your employees who simply need t
    7·1 answer
  • Several items are omitted from the income statement and cost of goods manufactured statement data for two different companies fo
    12·1 answer
  • If contracting parties attach materially different meanings to a contract word or term subject to more than one reasonable inter
    15·1 answer
  • How bad does a W look on a transcript?
    10·1 answer
  • Lila and Jillian both own small businesses in the town where they live. The women are friends and often get together to discuss
    15·1 answer
  • Angela's bank gave her a 2-year add-on interest loan for $6,440 to pay for new equipment for her antiques restoration business.
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!