Answer:
Explanation:
Prepare a post-closing trial balance.Step 9
Prepare an adjusted trial balance.Step 6
Analyze business transactions.Step 1
Prepare a trial balance.Step 4
Journalize the transactions.Step 2
Journalize and post closing entries.Step 8
Prepare financial statements.Step 7
Journalize and post adjusting entries.Step 5
Post to ledger accounts.Step 3
Answer:
1. Why is this an operating lease for Child Company?
The life of the asset is 10 years while the lease is only 3 years long, so it cannot be classified as a financial lease.
2. What are the amounts of the right-of-use asset and lease liability that Child Company should report on its balance sheet at December 31, 20X1?
annual lease payment = $128,000 (ordinary annuity)
PVIFA, 9%, 3 periods = 2.5313
present value = $128,000 x 2.5313 = $324,006.40
3. How much lease expense should Child Company recognize in 20X1?
lease expense = PV of lease x interest rate = $324,006.40 x 9% = $29,160.58
Answer:
The correct answer is the second option: Decrease; Increase.
Explanation:
To begin with, in the construction area the managers understand that when the company starts to build higher the building costs decrease due to the fact that is now working with bigger numbers so that means that the volumen of equipment, materials and commodities are high enough to decrease the costs due to the volumen managed, meanwhile the warehousing equipment costs tend to increase due to the same reason as before, now the company is working with bigger numbers so that means more equipment, materials and commodities to put in bigger warehouse and for more time.
Answer:
(1)$42.4 (2)$50.50 (3)$85.32
Explanation:
Solution
Given that:
(1) The current stock price is computed below:
Stock price, P0 = D1÷(r-g)
Where
D₁ = the next dividend expected
r = the return required
g = he growth rate
Thus
= $1.60×(1+6%)/(10%-6%)
$42.4
(2) The formula for the stock price in three years is given below:
Stock price, P3= D4÷(r-g)
Here
D₁ = the next dividend expected
r = the return required
g = he growth rate
= $1.60×[(1+6%)^4]/(10%-6%)
= $50.50
(3) Now we determine the price of the stock in 12 years
P12 = D13÷(r-g)
Here
D₁ = the next dividend expected
r = the return required
g = the growth rate
= $1.60×[(1+6%)^13]/(10%-6%)
= $85.32
