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Phantasy [73]
3 years ago
13

On December 1, 2018, Shamrock Company received $9,600 from Destiny, Inc. for rent of an office owned by Shamrock Company. The pa

yment covers the period from December 1, 2018 through February 28, 2019. Shamrock Company recorded this as Deferred Rent Revenue when it was received on December 1. The adjusting entry on December 31 would include a:
a. debit to Rent Revenue of $4,800.
b. credit to Rent Revenue of $3,200.
c. debit to Deferred Rent Revenue of $4,800.
d. credit to Deferred Rent Revenue of $3,200.
Business
1 answer:
andrey2020 [161]3 years ago
4 0

Answer:

b. credit to Rent Revenue of $3,200

Explanation:

Cash collected in advance results in the the creation of an asset and a liability. Hence a debit to cash account and a credit to deferred revenue. When the revenue is earned, it is recognized as a credit to revenue and a debit to deferred revenue with the amount earned.

Amount earned as at December 31

=  1/3 × $9,600

= $3,200

Entries required

Debit Deferred Rent revenue   $3,200

Credit Rent Revenue                 $3,200

Being entries to recognize revenue earned as at December 31

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During March, Adams Company had sales of $5,000,000, variable expenses of $3,000,000, and fixed expenses of $1,500,000. Assume t
ad-work [718]

Answer:

Option (c) is correct.

Explanation:

Variable cost as a percent of sales:  

= (Variable expenses ÷ Sales) × 100

= ($3,000,000 ÷ $5,000,000) × 100  

= 60%

If Sales = X

then Variable cost is 0.6X (i.e. 60% of Sales)

Sales - Variable cost - fixed expenses = net operating income

X - 0.6X - 1,500,000 = 300,000

0.4X = 300000 + 1500000 = 1800000

X = 1800000 ÷ 0.4

  = 4,500,000

4 0
2 years ago
The demand for one of X Company’s products has declined in recent years. The product is manufactured using designated equipment
djverab [1.8K]

Answer:

$230,000

Revised Question:

The demand for one of X Company's products has declined in recent years. The product is manufactured using designated equipment that originally cost $1,300,000 and has a carrying value of $720,000. As of the current date, December 31, 2012, it is expected that only an additional 400,000 units are likely to be sold over the remaining life of the equipment. Each unit sells for $3 and has a manufacturing cost of $1.50. Relevant information as of December 31, 2018:

The undiscounted future cash inflows from the sale of products over the life of the equipment is expected to be $600,000.

The present value of the future cash inflows from the sale of products over the life of the equipment, calculated at the company's cost of capital, is $475,000.

The equipment has a fair value of $490,000 on the date of evaluation.

How much of an impairment loss will X Company recognize in 2018?

Explanation:

IAS 36 Impairment of Assets states that company's or entity's assets can not be carried at more than their Recoverable Amount

<em>Recoverable Amount</em> equals to higher of Fair Value less cost of disposal and Value in Use

<em>Value in Use</em> is net present value (NPV) of future cashflows generated by an asset.

Lets calculate the Recoverable amount of the equipment of Company X:

Fair Value less Cost of disposal = $490,000 - 0 = $490,000

Value in Use = discounted future cashflows from equipment =  $475,000

<em>So Recoverable Amount is higher of Fair Value less cost of disposal and Value in Use i.e $490,000</em>

<h3>Impairment Loss = Carrying Value - Recoverable Amount </h3><h3>                              = $720,000 - $490,000</h3><h3>                              = $230,000</h3>
5 0
2 years ago
Which of the following is true regarding the Statement of Revenues, Expenses, and Changes in Net Position for a public college c
blsea [12.9K]

Answer:

All of these options is true

Explanation:

Statement of revenue and expenses is a comprehensive report showing the amount of profit earned minus the amount of operating expenses.

It provides information regarding the organization's operation as well as the revenue generated.

Revenue earned is collated as receipts and included in the statement of revenue and expenses.

Regarding the Statement of Revenues, Expenses, and Changes in Net Position for a public college choosing to report as a special-purpose entity engaged in business-type activities, the following apply:

  • State appropriations should be reported as non-operating income
  • Both contributions for plant and for endowment purposes must be reported separately after both operating and non-operating revenues and expenses
  • An operating income figure must be displayed
4 0
2 years ago
In the classic downward-sloping demand curve, as price increases, the demand for the product or service
vesna_86 [32]
The demand for a product or service would likely decrease as price increases as far as the classic downward-sloping demand curve is concerned. In addition, this specific type of demand curve characterises increase of consumer demand as the price significantly falls. 
5 0
3 years ago
He formal decision-making process used when considering the economic feasibility of implementing information security controls a
mrs_skeptik [129]

He formal decision-making process used when considering the economic feasibility of implementing information security controls and safeguards is called a CBA

WHAT IS A CBA ?

CBA stands for cost benefit analysis .

Businesses utilize a cost-benefit analysis as part of a systematic procedure to determine which options to take and which to ignore.

The cost-benefit analyst adds up the potential benefits anticipated from a circumstance or course of action before deducting the overall expenses related to that course of action.

It has the following benefits -

  1. Increased income and sales as a result of greater production or new goods.
  2. Benefits that can't be seen, such higher employee morale and safety, as well as increased consumer satisfaction via better products or quicker delivery.
  3. Gained market share or a competitive advantage as a result of the choice.

To learn more about CBA click here :

brainly.com/question/15411875

#SPJ4

6 0
1 year ago
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