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Pachacha [2.7K]
2 years ago
10

Fox Corp. failed to accrue warranty costs of $150,000 in its December 31, 20x2, financial statements. In addition, a $130,000 ch

ange from straight-line to accelerated depreciation was made at the beginning of 20x3. Both the $50,000 and the $30,000 are net of related income taxes. What amount should Fox report as prior period adjustments in 20x3?
Business
1 answer:
faust18 [17]2 years ago
8 0

Answer:

$150,000

Explanation:

$150,000

The failure to accrue warranty expense is an accounting error. It gives rise to a Prior period adjustment in the year of discovery (20x3).

Prior period adjustments are limited to corrections of errors affecting prior-year net income. They adjust the beginning balance of retained earnings in the year of correction.

The change in depreciation method is an estimate change, which is reported in earnings. It is not a Prior period adjustmen

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A factory produces product A according to the production function QA = 100XA, where XA denotes the amount of input and QA is the
Ostrovityanka [42]

Answer:

Option (B) is correct.

Explanation:

XA + XB = 100

QA = 100XA

QB = 200XB - XB^2

Use the fact that,

XA = 100 - XB

Now total production is Q = QA + QB

Q = 100XA + 200XB - XB^2

Q = 100 × (100 - XB) + 200XB - XB^2

Q = 10,000 + 100XB - XB^2

Output is maximum when Q'(XB) = 0

100 = 2XB = 0

XB = 50

XA = 50

Therefore, the firm’s profit-maximizing allocation of input X is 50 units of XA and 50 units of XB.

5 0
2 years ago
Given the following data for Glennon Company, compute (A) total manufacturing costs and (B) costs of goods manufactured:
erica [24]

Answer:

1. Glennon Company

Total manufacturing costs and costs of goods sold:

C) $790,000 $810,000

2. Carr Company

Annual Rate of Return for Project Soup:

B) 7.5%.

Explanation:

1A) Total Manufacturing costs

Direct materials used          $270,000

Beginning work in process     40,000  

Direct labor                            200,000

Ending work in process         (20,000 )

Manufacturing overhead      300,000

Total manufacturing costs $790,000

1B) Costs of goods sold:

Beginning finished goods           50,000

Costs of goods manufactured  790,000

less Ending finished goods        (30,000)

Cost of goods sold                   $810,000

2)                                Project Soup       Project Nuts

Initial investment         $400,000           $600,000

Annual net income          30,000                46,000

Net annual cash inflow   110,000              146,000

Annual Rate of Return = Annual net income/Initial Investment

= $30,000/$400,000 x 100 = 7.5%

8 0
3 years ago
Zenith Investment Company is considering the purchase of an office property. It has done an extensive market analysis and has es
ValentinkaMS [17]

Based on the NOIs from Year 1 to 8, the value of the property today to Zenith Investment Company will be $13,221,383.94.

<h3>What is the value of the investment today?</h3>

Because the investment will be sold in 7 years, we need to find the terminal value from year 8 and above considering the indefinite growth rate of 3%.

Terminal value:

= Year 8 cashflow / (Return rate - Growth rate)

= 1,459,170 / (12% - 3%)

= $16,213,000

This amount should be added to the Year 7 cashflow to get:

= 16,213,000 + 1,419,000

= $17,632,000

The value today can be found by taking all the cashflows to their present value and summing them:

= 1,240,000/ 1.12 +  1,240,000 / 1.12² +  1,240,000 / 1.12³ + 1,280,000 / 1.12⁴ +  1,330,000 / 1.12⁵ +  1,380,000/ 1.12⁶ +  17,632,000⁷

= $13,221,383.94

Find out more on present value at brainly.com/question/17199492.

7 0
2 years ago
You bought 200 shares of Stock A at $23.00 per share 6 months ago. It is now worth $47 per share. What was the percent of increa
Nat2105 [25]

Answer:

51 % increase

Explanation:

Stock A price= $23.00

Stock A price after 6 months= $47.00

Increase in price of Stock A= $47 - $23

                                          = $24

Percentage increase in stick price = <u>$24</u>  x  100%

                                                        $47

                                                     = 0.510 x 100%

                                                     = 51%

The percentage increase in the price of Stock A is 51%

Cheers

4 0
3 years ago
Read 2 more answers
Assume a firm has a beta of 1.2. All else held constant, the cost of equity for this firm will increase if the: beta decreases.
eduard

Answer:

Risk-free rate decreases

Explanation:

The CAPM formula for calculating cost of equity requires one to know the value of 3 pieces of information only:

1. the market rate of return,

2. the beta value

3. the risk-free rate.

Ra = Rrf + [Ba∗(Rm−Rrf)]

where:

Ra=Cost of Equity

Rrf = Risk-Free Rate

Ba = Beta

Rm=Market Rate of Return

​From the formula

Ra = Rrf + [1.2∗(Rm−Rrf)]

Ra = Rrf + 1.2Rm - 1.2Rrf

From Ra = 1.2Rm -0.2Rrf

From the expression above, it can be seen that the lower the value of Rrf (Risk-Free rate), the higher the value of Ra.

4 0
2 years ago
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