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Step2247 [10]
3 years ago
13

Convers Corporation (calendar-year-end) acquired the following assets during the current tax year: (ignore §179 expense and bonu

s depreciation for this problem): (Use MACRS Table 1, Table 2 and Table 5.)
Asset Date Placed in Service Original Basis
Machinery 10/25 70,000
Computer Equipment 2/3 10,000
Used Delivery Truck 3/17 23,000
Furniture 4/22 150,000
Total 253,000
The delivery truck is not a luxury automobile.
In addition to these assets, Convers installed new flooring (qualified improvement property) to its office building on May 12 at a cost of $300,000.
What is the allowable MACRS depreciation on Convers’s property in the current year assuming Convers does not elect §179 expense and elects out of bonus depreciation?
Business
1 answer:
marishachu [46]3 years ago
5 0

Answer:

$42,853

Explanation:

The computation of the allowable MACRS depreciation on Convers’s property in the current year is shown below:

<u>Assets      Place in service    Quarter   Original Basis  Rate Depreciation</u>

Machinery

(7 years)     Oct 25                   4th           $70,000         14.29%  $10,003

Computer

Equipment

(5 years)    Feb 03                   1st            $10,000         20%       $2,000

Used delivery

truck

(5 years)     Mar 17                   1st            $23,000        20%       $4,600

Furniture

(7 years)     Apr 22                  2nd         $150,000       14.29%    $21,435

Qualified

improvement

(39 years)    May 12                 2nd         $300,000     1.605%     $4,815

Total                                                        $553,000                       $42,853

Refer to the MACRS depreciation table

and we used the half year convention

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Anderson Compounds produces two industrial chemical compounds, Gorp and Gumm, from the same process, which last year, cost $480,
Olin [163]

Answer:

b. 320000

Explanation:

In order to calculate the joint cost of Gorp we need to understand what the method means and how it's used to calculate it. The adjusted sales method is used to allocate joint costs based on the prices the products are sold.

First of all we need to calculate the percentage of Selling price of Gorp to that of the total selling price of both Gorp and Gumm.

I.e: 60 ÷ (60+30) × 100

SP % of Gorp= 66.67%

Now we calculate joint cost allocated to Gorp.

Total joint cost of both Gorp and Gumm = $480000

Joint cost of Gorp = $480000 × 66.67%

Joint cost of Gorp = $320,000

3 0
3 years ago
Which of the following determines the process that a company will use to create its product? Group of answer choices a firm's mu
tekilochka [14]

Answer:

The answer is a firm's business level strategy

Explanation:

A strategy is a blueprint or a plan which spells out the major policies of an organisation, its goals and actions that will enables it to achieve the organisational objectives.

A firm business level strategy is a tool aimed at improving the competitive position of a firm's products within the market segment or industry that the firm operates.  It focuses on how a firm will satisfy customer's needs and gain competitiveness in the market in which it operates by  exploiting opportunities in market.  

6 0
3 years ago
Fama’s Llamas has a weighted average cost of capital of 10.9 percent. The company’s cost of equity is 12 percent, and its pretax
mojhsa [17]

Answer:

0.2

Explanation:

The weighted average cost of capital (WACC) is calculated as below:

WACC = (D/A) x r_D x (1-t) + (E/A) x r_E , where:

A: Market value of company asset;

D: Market value of company debt;

E: Market value of company equity;

r_D: pre-tax cost of debt;

r_E: cost of equity;

t: tax rate

Rearrange above formula a bit, we get:

WACC = (D/A) x r_D x (1-t) + (1 - D/A) x r_E

Putting all the numbers together, we have:

10.9% = (D/A) x 8.9% x (1 - 38%) + (1 - D/A) x 12%

Solve the equation, we get D/A = 17% or D/E = 0.2

So, target debt−equity ratio is 0.2

4 0
3 years ago
Dave is a salaried employee who works in a gas station. He only earns from his job and has no other source of income. He gets a
Grace [21]

Answer:

In my opinion the most suitable answer is E. increase his sources of income to show a rise in his income after taxes

Explanation:

The reason is he could lower his expenses too, but for how long? Inflation is going to eat his salary away anyway possibly in 5 to 10 years so what Daventry ustock do is to create another source of income so that he is safe. Possibly through investing in income generating assets, real estate and possibly a side hustle! (A small time business)

6 0
3 years ago
Mr. Henshaw, CEO of MBA Bank, decides that the organization needs to provide more convenient service to customers. He decides to
ANTONII [103]

Answer: unfreezing

Explanation:

The unfreezing stage of Lewis change process is being regarded as the first stage of change, and in this stage, an organization is being prepared and accept that change is inevitable and necessary and that existing status quo should also be broken.

This is illustrated in what Mr. Henshaw, CEO of MBA Bank did, by deciding that the organization needs to provide more convenient service to customers.

6 0
2 years ago
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