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2 years ago

Indicate the type of Deferred Tax account created by Unearned Revenues and Prepaid Expenses, respectively:

Business

1 answer:

irina [24]2 years ago

5 0

Answer:

The answer is Deferred tax asset and Deferred tax liability.

Explanation:

Unearned revenue creates deferred tax asset. In here, taxes have been paid because income has been received but have not been recognized on the income statement because according to the revenue recognition, the services for the revenue has not been rendered.

Prepaid expenses give rise to deferred tax liability. In here, taxes have been recognized on income statement but the actual tax has not been paid. Income tax expense on income statement is greater than taxes payable

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A manufacturing firm is considering two locations for a plant to produce a new product. The two locations have fixed and variabl

o-na [289]

Answer:

Cost Advantage of different locations:

b. $20,000

Phoenix certainly had a cost advantage over Atlanta and based on this factor, it should be chosen for the new plant instead of any other city.

Explanation:

a) Total Costs of different locations:

Atlanta Phoenix

Fixed Cost $80,000 $140,000

Variable cost 400,000 320,000

Total Costs $480,000 $460,000

b) Variable costs

Atlanta Phoenix

Annual Demand 20,000 20,000

Variable cost/unit $20 $16

Total variable cost $400,000 $320,000

c) Cost Advantage is the competitive edge which location (or company) can have over another through reduced production or marketing costs or both so that it can offer cheaper prices or use excess profits to bolster promotion or distribution. In this case, the comparison is on the total cost, which is made of variable and fixed costs.

4 0

3 years ago

Which of the following is true about a "credit"? I. It is part of the double-entry procedure that keeps the accounting equation

kipiarov [429]

Answer:

III. I, II, III, and IV.

I. It is part of the double-entry procedure that keeps the accounting equation in balance.
II. It represents a decrease to assets.
III. It represents an increase to liabilities.
IV. It is on the right side of a T-account.

Explanation:

The debit-credit balance is necessary for maintaining the accounting equation in balance, i.e. all the debits must have a corresponding credit.

Asset accounts increase when they are debited and decrease when they are credited.

Liabilities accounts decrease when they are debited and increase when they are credited.

Debits are on the left side of a t-account and credits are on the right side.

3 0

3 years ago

Suppose you just bought a 25-year annuity of $8,200 per year at the current interest rate of 12 percent per year. What is the va

zhannawk [14.2K]

Answer:

64,313.74 ; 95,559.38 ; 47,283.11

Explanation:

by definition the present value of an annuity is given by:

$a_{n} =P*\frac{1-(1+i)^{-n} }{i}$

where $a_{n}$ is the present value of the annuity, $i$ is the interest rate for every period payment, n is the number of payments, and P is the regular amount paid. so applying to this particular problem, we have:

1. P=8,200, n=25, i=12%

$a_{n} =8,200*\frac{1-(1+12\%)^{-25}}{12\%}$

$a_{n} =64,313.74$

2. P=8,200, n=25, i=7%

$a_{n} =8,200*\frac{1-(1+7\%)^{-25} }{7\%}$

$a_{n} =95,559.38$

3. P=8,200, n=25, i=17%

$a_{n} =8,200*\frac{1-(1+17\%)^{-25} }{17\%}$

$a_{n} =47,283.11$

6 0

3 years ago

Which compounding periods will yield the lowest effective annual rate given a stated future value at year 5 and an annual percen

emmainna [20.7K]

Answer:

Annual

Explanation:

The ANNUAL compounding periods will yield the lowest effective annual rate given a stated future value at year 5 and an annual percentage rate of 10 percent

4 0

3 years ago

World Company expects to operate at 80% of its productive capacity of 66,250 units per month. At this planned level, the company

Gnom [1K]

Answer:

Overhead volume variance = $3,000 Unfavorable

Overhead controllable variance = $26,500 unfavorable

Explanation:

As per the data given in the question,

Number of units produced = 80% × 66,250

= 53,000 units

Standard = 26,500 hours ÷ 53,000 units

= 0.5 direct labor hour per unit

Particulars a b Direct labor hour(a ÷ b)

Variable overhead rate $331,250 26,500 $12.5 per hour

Fixed overhead rate $53,000 26,500 $2 per hour

Total overhead rate $384,250 $15 per hour

The standard hours to produce 50,000 units = 25,000 (50,000 units × 0.50 hours per unit.)

Applied fixed overhead = $2 × 25,000

= $50,000

Overhead fixed volume variance is

= $53,000 - $50,000

= 3,000 unfavorable

Now

b) Standard hour = 50,000 units × 0.5 direct labor hour per unit

= 25,000

Overhead rate(a) Standard hours(b) Applied overhead(a × b) Actual variance

Variable overhead $12.5 25,000 $312,500

Fixed overhead $2 25,000 $50,000

Total overhead $14.5 25,000 $362,500 $389,000

= $362,500 - $389,000

$26,500 unfavorable

If the actual cost is more than the standard one than the variance should be unfavorable and If the actual cost is less than the standard one than the variance should be favorable

6 0

3 years ago