Answer:
A. Consumers will be more likely to buy luxury goods in foreign markets.
Answer:
These statements are true:
A) The Federal Reserve does not set the Federal funds rate, but it influences it through the use of open market operations:
For example, at the very moment the Fed funds rate is 1.75%. If the Fed wanted to raise it to 2%, it would have to do so through the use of open market operations (in this case, because it wants to raise the rate, it would have to sell securities in order to reduce the money supply).
C) The Federal Reserve sets the target for the Federal funds rate, and then uses the reserve ratio to push banks toward that target.
Reserve requirements are perhaps the most powerful, and least often used, monetary policy tool that the Fed has at its disposal. It is very powerful because it directly increases or decreases the money supply.
For example, if the Fed wants to increase the fed funds rate, it can raise the reserve ratio so that banks keep more money in reserves, have less money to loan, and in consequence, create less money, causing the money supply to shrink and the fed funds rate to rise accordingly.
D) The Federal Reserve sets the Federal funds rate.
Correct. More specifically, the Federal Open Market Committee, which meets eight times a year to set the target for the fed funds rate.
Answer:
The refund claimed should be shown as a benefit due to loss carryback in 2018.
Explanation:
Since Tanner, Inc. incurred a financial and taxable loss for 2018. and decided to use the carryback provisions as it had been profitable up to this year, the amounts related to the carryback should be reported in the 2018 financial statements as a benefit due.
Tax loss carryback is when a corporation <u>retrospectively adjusts its tax returns for prior periods</u> if it incurs a net operating loss (NOL) in current period.
The loss carryback <u>generates a tax refund</u> for the business because it reduces previous year tax liability. After the carried back loss is applied, it will be <u>as though the business overpaid taxes the previous year; which will now be shown as a benefit in the current year</u>
Answer:
$87,120
Explanation:
The calculation of the deferred tax asset for the NOL carryforward is given below:
= (Year 2021 loss - Year 2022 income) × tax rate applicable for all years
= ($600,000 - $358,000) × 36%
= $242,000 × 36%
= $87,120
Since in a year 2021 it is a loss and the income in year 2022 that is to be adjusted and the same is considered in the computation part
Hence, the deferred tax assets for the NOL carryforward is $87,120
Answer:
a. The first year's net earnings under the cash basis of accounting is $7,600 and the first year's net earnings under the basis of accounting is $12,200
b. Accrual basis of accounting provides more useful information.
Explanation:
a. In order to calculate the first year's net earnings under the cash basis of accounting we would have to use the following formula:
Cash basis net earnings = Service revenue (Cash) – Cash expenses – Prepaid expenses
Cash basis net earnings =$22,000 – $12,000 – $2,400
Cash basis net earnings =$7,600
In order to calculate the first year's net earnings under the the basis of accounting we would have to use the following formula:
Accrual basis net earnings = Service revenue – Operating expenses incurred
Accrual basis net earnings= $28,000 – $15,800
Accrual basis net earnings=$12,200
b. Accrual basis of accounting provides more useful information, because in this system revenues are recorded what actually earned and expenses are recorded what actually incurred for earning such revenues. Therefore, it gives better profit picture
