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3 years ago

Presented below is information related to Wise Company at December 31, 2017, the end of its first year of operations.

Business

1 answer:

Elenna [48]3 years ago

7 0

Answer and Explanation:

The computation is shown below:

Sales revenue $775,000

Less: Cost of goods sold 350,000

Gross profit 425,000

Less: Selling administrative expenses 125,000

Income from operations 300,000 (a)

Income from operations

Other revenues and gains

Add: Gain on sale of plant assets 75,000

Other expenses and losses

Income before other expenses and losses 375,000

Less: Interest expense 15,000

Income from continuing operations 360,000

Less: Loss on discontinued operations (30,000)

Net Income 330,000 (b)

Net income

Less: Allocation to noncontrolling interest (100,000)

Net income attributable to controlling shareholders $230,000 (c)

Net income $330,000

Add: Unrealized gain on available-for-sale investments 25,000

Comprehensive income $355,000 (d)

e. Retaining earnings opening balance $0

Add: Net income $330,000

Less: Dividends (12,000)

Closing Retained earnings $318,000 (e)

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ohnstone Company is facing several decisions regarding investing and financing activities. Address each decision independently.

Vesnalui [34]

Answer:

Johnstone should value the equipment at $40,326.29.

Explanation:

To determine this, the present value of the five annual installments of $8,000 is first calculated using the formula for calculating the present value of an ordinary annuity as follows:

PV = P * ((1 - (1 / (1 + r))^n) / r) …………………………………. (1)

Where;

PV = Present value of the five annual installments =?

P = Annual payment = $8,000

r = interest rate = 10%, or 0.10

n = number of years = 5

Substitute the values into equation (1) to have:

PV = $8,000 * ((1 - (1 / (1 + 0.10))^5) / 0.10)

PV = $8,000 * 3.79078676940845

PV = $30,326.29

Therefore, the present value of the five annual installments of $8,000 is approximately $30,326.29.

As result of this:

Value the equipment = Payment on the purchase day + present value of the five annual installments = $10,000 + $30,326.29 = $40,326.29

Therefore, Johnstone should value the equipment at $40,326.29.

7 0

3 years ago

In the ________ component of SCM, supply chain managers must create a responsive and flexible network to support customers who h

Anastaziya [24]

Answer:

Return

Explanation:

Supply chain management (SCM) is the management of interconnected activities involved in movement and storage of raw material, work in progress and finished goods. The process is used to check if supply chain activites are working smoothly or not, also, is it cost effective or not?. SCM follow basic five component:

Plan
Develop
make
Deliver
Return.

Return is a stage where supply chain managers must create a responsive and flexible network to support customers who have problems with delivered products.

8 0

4 years ago

Smith Company gives the following information on the financial statements: Net Income $50,000 Preferred Dividends 8,000 Average

ch4aika [34]

Answer: The rate of return on common stockholder’s equity is 23%.

Explanation:

Given that,

Net Income = $50,000

Preferred Dividends = 8,000

Average Common Stockholder’s Equity = 180,000

Average number of Common Shares Outstanding = 250,000 shares

Market Price = $2 per share

Therefore,

Return on equity = $\frac{Net\ income - Preferred\ Dividends}{stockholder\ equity}$

= $\frac{50000 - 8000}{180000}$

= 23%

5 0

3 years ago

Which of the following contradicts the proposition that the stock market is weakly efficient?A. Over 25% of mutual funds outperf

Arisa [49]

Answer:

The correct answer is letter "C": Every January, the stock market earns above-normal returns.

Explanation:

Inside the Efficient Market Hypothesis or EMH, we can find the term "weak from efficiency" that states past price action do not influence the current stock price or it is not useful in order to predict future price movements. According to the same concept, the use of technical analysis or the suggestions of financial advisers is useless.

In that sense, option letter "C" indicates that every January the stock market earns an above-normal return, which clearly reflects that there is a repeated pattern in the stocks affecting their price during that specific month, something impossible to take place according to what "weak from efficiency" establishes.

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3 years ago

What is generally TRUE about earning an income?

Daniel [21]

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