Answer:
Journal Entries
Dr. Investment in Lopez Railways Inc. $600,000
Cr. Cash $600,000
Dr. Investment in Lopez Railways Inc $59,600
Cr. Income of Investment in Lopez Railways Inc $59,600
Dr. Cash $10,800
Cr. Investment in Lopez Railways Inc $10,800
Explanation:
As Windsor Locomotive Corporation has purchased 40% interest in Lopez Railway Inc.Lopez Inc. is classified as the associate company of Windsor Corp.
Share in net Income = $149,000 x 40% = $59,600
Share In Dividend = $27,000 x 40% = $10,800
To become industrial, a nation must have raw materials, workers
and capital is absolutely true. Without any of the things mentioned, it is
impossible to become an industrial nation. The raw materials are required to
produce the finished product. The workers are the ones that work in industries
to produce the finished proudest from the raw materials. It can be physical as
well as mental labor. Capital is required to buy raw materials and labor for
getting the finished product and make profit.
Answer:
False
Explanation:
As a company's sales level increases, its current assets will increase, e.g. cash, inventories, accounts receivables increase. generally, also the fixed assets increase, specially if the firm was previous producing at full capacity even before total sales increased. But as sales increase, not only do the company's assets increase, its current liabilities generally increase also, and its profits should increase. In this case, 60% of the company's profits are reinvested in the company, and the liabilities represent more than half of the total assets. Therefore, it is possible that the company needs external financing, but it is also possible that it doesn't. You cannot assume that the company will necessarily need external financing, because retained earnings and the increase in current liabilities might be enough to finance the company's growth in sales.
Answer:
The project is worth $2,738.57.
Explanation:
Giving the following information:
You have been offered a project paying $300 at the beginning of each year for the next 20 years. The rate of return is 9%.
To calculate the present value, first, we need to calculate the final value:
FV= {A*[(1+i)^n-1]}/i
A= annual pay= 300
n= 20
i= 0.09
FV= {300*[(1.09^20)-1]}/0.09
FV= $15,348.06
Now, we can calculate the present value:
PV= FV/(1+i)^n
PV= 15,348.06/1.09^20= $2,738.57
