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4 years ago

Since retained earnings are generated by the firm:

Business

1 answer:

Damm [24]4 years ago

7 0

Answer:

The correct option is C,the funds have a positive cost that is less than new equity issues.

Explanation:

Retained earnings have costs attached to it because the common stockholders expect that the company would use its retained earnings effectively such that is able to pay dividends at year or in such a way that the company's stock share price appreciates(capital gains yield)

However, the cost of retained earnings is lower when compared with new equity issues since the new issue would require issue costs such as regulatory fees as well as underwriter's commission.

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Cotton Hotel Corporation recently purchased the Hotel Middleburg and the land on which it is located. Cotton Hotel Corporation i

Yanka [14]

a. depreciated over the period from acquisition to the date the hotel is scheduled to be torn down.

b. written off as a loss in the year the hotel is torn down.

c. capitalized as part of the cost of the land.

d. capitalized as part of the cost of the new hotel.

capitalized as part of the cost of the land.

Answer: Option C.

Explanation:

Since the land of the hotel is going to be the same on which the new hotel is going to be built, the cost of the hotel would be capitalized as the cost of the land of the new hotel that is to be built on the same land on which the hotel middleburg was built.

It was written in the books as the capitalized cost of the land because the land of both the hotels are going to be the same.

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3 years ago

On its year 1 financial statements, Seatax Corporation, an accrual-method taxpayer, reported federal income tax expense of $570,

Nookie1986 [14]

Answer: $570000

Explanation:

The book-tax difference, that's associated with its federal income tax expense that Seatax should have reported when computing its year 1 taxable income will be $570000.

It should be noted that the $570000 for the book tax difference is permanent as it isn't reversible for.the next fiscal period.

7 0

3 years ago

briefly explain what you consider an entrepreneur to be and describe the three most important attributes you need to develop to

expeople1 [14]

Answer:

An entrepreneur is a person who finds an economic opportunity in the market, and exploits it for his own benefit and the benefit of his employees and constomers by setting up a firm.

Explanation:

Three characteristic of an entrepreneur:

Opportunity seeking: entrepreneurs "scan" the market, seeking for market niches that have not been exploited.

Work-ethic: entrepreneurship is a difficult task, especially during the first years of the company. It demands very long work hours, and the entrepreneur must be willing to do that in order to be successful.

Risk-taking: entrepreneurs should evaluate risk when taking decisions, but they should not be the most risk-averse indidivuals. They have to take risks in certain situations because otherwise, they would not be able to become entrepreneurs at all.

3 0

3 years ago

Brace Corporation uses direct labor-hours as the cost driver in its normal costing system. Brace budgeted that it would use 21,6

arsen [322]

Answer:

total estimated overhead costs for the period= $515,095.2

Explanation:

First, we need to calculate the allocated overhead:

Under/over applied overhead= real overhead - allocated overhead

20,440 = 506,920 - allocated overhead

allocated overhead= $486,480

Now, we can determine the predetermined overhead rate:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

486,480= Estimated manufacturing overhead rate*20,400

Estimated manufacturing overhead rate= 486,480/20,400

Estimated manufacturing overhead rate= $23.847 per direct labor hour

Finally, the estimated overhead for the period:

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

23.847= total estimated overhead costs for the period/21,600

total estimated overhead costs for the period= 21,600*23.847

total estimated overhead costs for the period= $515,095.2

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3 years ago

Hamby Company expects to incur overhead costs of $10,000 per month and direct production costs of $136 per unit. The estimated p

hichkok12 [17]

Answer:

c. $272

Explanation:

Overhead costs (O) = $10,000 per month

Direct production costs (Pc) = $136 per unit

Units produced (n) = 1,600 units

The total manufacturing cost per unit for a production activity of 1,600 units is given by:

$C=\frac{(P_C*n)+(O*12)}{n}\\C=\frac{(136*1,600)+120,000}{1,600}\\C=\$211$

For a desired gross profit per unit of $61, the selling price should be:

$61=S-211\\S=\$272$

The answer is c. $272

4 0

4 years ago