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Ivan
3 years ago
8

The Superior Company acquired a building for $500,000. The building was appraised at a value of $575,000. The seller had paid $3

00,000 for the building 6 years ago. Which accounting principle would require Superior to record the building on its records at $500,000?
Business
1 answer:
MissTica3 years ago
5 0

Answer:

Cost principle.

Explanation:

Cost or historical cost principle.

The assets, liabilities and equity must enter the accounting at their original purchase cost rather than current market value. This bulding, which is an asset was purchase for 500,000. Therefore, his cost is 500,000. It will be recorded at 500,000.

And will not increase for changes in the market value. Only at the moment of selling or disposal of the assets the accounting will recognzie a gain or loss.

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Capes Corporation is a wholesaler of industrial goods. Data regarding the store's operations follow: Sales are budgeted at $280,
mario62 [17]

Answer and Explanation:

a. The preparation of Schedule of Expected Cash Collections for November and December is shown below:-

Schedule of Expected Cash Collections

for the month of November and December

Particulars                      November              December

Accounts receivable     $63,000

Sales                               $280,000             $290,000

Expected cash collection

in the month of sale 60%

collection                        $168,000                $112,000

                                      ($280,000 × 60%) ($280,000 × 40%)

Next month 40%

cash collection                                                $174,000

                                                                  ($290,000 × 60%)

Total cash collection    $231,000                 $286,000

b. The Preparation of Merchandise Purchases Budget for November and December is shown below:-

Particulars                 November      December    January

Cost of goods sold a

(80% of sale)               $224,000    $232,000       $216,000

                           ($280,000 × 80%) ($290,000 × 80%) ($270,000 × 80%)

Add: Ending

inventory b                    $92,800           $86,400

                                  ($232,000 × 40%) ($216,000 × 40%)

Total inventory             $316,800          $318,400

(c = a + b)

Less: Opening inventory d $89,600          $92,800

                                  ($224,000 × 40%)

Material to be

purchased                          $227,200         $225,600

(e = c - d)

5 0
3 years ago
Aggregates all cash inflows, which the company receives from its ongoing activities and investment sources, and all cash outflow
levacccp [35]

The balance sheet aggregates all cash inflows, which the company receives from its ongoing activities and investment sources, and all cash outflows.

A company , abbreviated as co., is a felony entity representing an association of humans, whether herbal, criminal or a mixture of each, with a particular goal. company contributors share a common reason and unite to achieve unique, declared dreams.

An organization is a felony entity shaped by a group of individuals to interact in and operate an enterprise in a business or industrial capability. An organization's business line depends on its structure, which may vary from a partnership to a proprietorship, or maybe an employer.

A company is a sort of enterprise structure that may be a separate legal entity from its owners. it's a complex business shape, with better set-up and administrative fees due to greater reporting requirements and higher-stage criminal responsibilities.

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7 0
1 year ago
An agreement to exchange dollar bank deposits for euro bank deposits in one month is a:_________
koban [17]

An agreement to exchange dollar bank deposits for euro bank deposits in one month is a <u>forward transaction.</u>

<h3>What is a forward contract?</h3>

A tailored agreement between two parties to purchase or sell an item at a predetermined price at a later date is known as a forward contract. Although its non-standardized nature makes it particularly suitable for hedging, a forward contract can be utilized for speculating or hedging.

A forward contract can be tailored to a commodity, amount, and delivery date, unlike typical futures contracts. Grain, precious metals, natural gas, oil, and even chicken are examples of traded commodities. Settlement of a forward contract may take place in cash or by delivery.

Forward contracts are categorized as over-the-counter (OTC) instruments because they are not traded on a centralized exchange. While the OTC nature of these products makes it simpler to adjust terms, the absence of a centralized clearinghouse also increases the chance of default.

Thus, it is a forward transaction that is used to exchange dollar bank deposits for euro bank deposits in one month.

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8 0
1 year ago
Which type of tax is paid by businesses on their profits to federal or state governments?
Anna11 [10]

Answer:

Corporate income tax

Explanation:

A corporate income tax (CIT) is levied by federal and state governments on business profits, which are revenues (what a business makes in sales) minus costs (the cost of doing business).

5 0
2 years ago
To calculate your return on a stock: If you bought a stock at $80 and earned a $3.00 dividend over the year and at the end of th
grandymaker [24]
New value: $87
new-orig= $7
7/80= 0.0875=87.5%
7 0
3 years ago
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