Answer:
closest to: B) $7777
Explanation:
NPV ( net presetn value) cashflow - investment
<u>cost savings present value (ordinary annuity):</u>
C $8,500
time 5 years
rate 0.12
PV $30,640.5977
salvage value present value:
Salvage $2,000
time 5
rate 0.12
PV 1,134.85
NPV: 30,640.60 + 1,134.85 - 24,000 = 7,775.45
Answer:
Net income under absorption costing is $240,000
Explanation:
Sales (825*$1075) $886,875
less variable costs
Variable production cost($375*825) (309,375)
selling and admin. expense ($95,000)
Contribution margin $482,500
less fixed costs:
fixed production cost ($107,500)
selling and admin. expense ($135,000)
Net income $240,000
Net income under absorption was $25,000 more than the net income under the absorption costing, the difference is analyzed below:
Fixed product costs (1075-825)*$100=$25,000
That is the fixed production costs added to closing inventory under absorption method which was expensed under variable costing method
Answer:
The correct answer is add $72 to the book's balance.
Explanation:
Bank reconciliation is a way of identifying discrepancies between the cash book balance (company's books) and the bank balance (balance per bank statement). The discrepancies can be as a result of erroneous posting, deposit in transit, outstanding checks, etc.
In the instance of the question, there was an erroneous posting in the cash book of $72 ($480 - $408). Instead of crediting cash book by $408, it was rather credited by $480 - meaning that the credit was overstated by $72. <em>To correct this erroneous posting, we have to add back $72 to the cash book balance.</em>
Answer:
a. current tax rate or future tax rates, depending on when the temporary difference will reverse.
Explanation:
Deferred Tax is not payable to tax Authority it is only a book entry used by Accountants to match Income taxes payable in terms of Income Act and Income taxes expected to be presented to users in financial Statements.
Deferred taxes are based on current tax rate or future tax rates, depending on when the temporary difference will reverse.
Answer:
c. Ending inventory will be lower if Blake uses weighted average than if FIFO were used
Explanation:
To check which answer is correct, we simply evaluate each option step by step.
<u>Option A</u>
Gross margin is the difference between selling price and cost.
Under FIFO gross margin is $14. (32 -18 =14)
Under LIFO gross margin is $13. (32-19 = 13)
Thus statement is incorrect as gross margin is higher if FIFO is used.
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<u>Option B</u>
If FIFO is used, the dollar amount of ending inventory will be $19 as ending inventory will contain product purchased later that is at $19. In contrast, if LIFO is used, the dollar amount of ending inventory will be $18. Thus the statement becomes incorrect that it will be the same.
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<u>Option C</u>
The ending inventory under FIFO is $19.
The ending inventory under LIFO is $18
The endng inventory under AVCO or weighted average will be, 18+19 / 2 = 18.5
Thus the statement is correct as the ending inventory under weighted average $18.5 is lower than ending inventory under FIFO $19. So, C is the correct Answer.
