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irga5000 [103]
2 years ago
5

Company A estimates that it needs 30% of sales in net working capital. In year 1, sales were $1 million and in year 2, sales wer

e $2 million. Associated with the change in net working capital from year 1 to year 2 is a cash:(A) inflow of $300,000.(B) outflow of $300,000.(C) inflow of $600,000.(D) outflow of $600,000.
Business
1 answer:
Verizon [17]2 years ago
5 0

Answer:

(B) outflow of $300,000

Explanation:

The change in net working capital of the Company A shall be determined through the following mentioned equation:

Change in net working capital=Percentage of sales in year 2-Percentage of sales in year 1

Change in net working capital=0.30*$2,000,000-0.30*$1,000,000

                                                    =$300,000 out flow

So based on the above calculations, the answer shall be (B) outflow of $300,000

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Erica and Brett decide to form their new motorcycle business as an LLC. Each will receive an equal profits (loss) interest by co
koban [17]

Answer:

Brett's outside tax basis in his LLC interest is $45000

Explanation:

A partner outside tax basis consist of basis of contributed property, partnership debt allocated to the partner without any debt relief. Non recourse debt that is more than basis of contributed property must be given to the partner that contributed to the property.

Brett's outside tax basis in his LLC interest = Cash contribution + basis of building - debt of building + Non recourse loan + non recourse mortgage + remaining mortgage on building

Cash contribution = $5000

Basis of building = $30000

Debt of building = $35000

Non recourse loan = Profit sharing ratio × Non recourse loan = 50% × $50000 = $25000

non recourse mortgage = $5000

remaining mortgage on building  = 50% × $30000 = $15000

Brett's outside tax basis in his LLC interest = $5000 + $30000 - $35000 + $25000 + $5000 + $150000 = $45000

4 0
3 years ago
Box Elder Power Company expects to operate at 85% of productive capacity during May. The total manufacturing costs for May for t
olga nikolaevna [1]

Answer:

The unit cost below which Box Elder Power Company should not go in bidding on the government contract is $9.30

Explanation:

Box Elder power company produced 40,000 batteries in the month of May

Total Direct materials = $240,000

Total Direct labor = 100,000

Total Variable factory overhead = 32,000

Total Fixed factory overhead = 150,000

Total manufacturing costs = $522,000

So only relevant costs are:-

Direct Material per unit = $240,000 ÷ 40,000 = $6 0

Direct Labor per unit = $100,000 ÷ 40,000 = $2.5 0

Variable Factory OH per unit = $32,000 ÷ 40,000 = $0.8 0

Therefore total overhead = $9.3 0

8 0
2 years ago
Susie decided to start selling lemonade on her street. The other kids in the neighborhood noticed that Susie was making a lot of
xxTIMURxx [149]

Answer:

Decreases and the equilibrium quantity increases

Explanation:

If more children join Susie in the lemonade business, the supply of lemonade would increase. This is indicated by a rightward shift of the supply curve. Because supply has increased relative to demand , price would fall and equilibrium quantity would increase.

I hope my answer helps you

7 0
2 years ago
Riverbed Corporation sells computers under a 2-year warranty contract that requires the corporation to replace defective parts a
Arte-miy333 [17]

Answer:

A.

Dr Cash $891,540

Dr Warranty Expense $127,254

Cr Sales Revenue $891,540

Cr Warranty Liability $127,254

B. Current Liabilities

Warranty Liability $63,627

Long-term Debt

Warranty Liability $63,627

C. Dr Warranty Liability 61,300

Cr Inventory 21,400

Cr Salaries and Wages Payable 39,900

Explanation:

A. Preparation of the journal to Record any necessary journal entries in 2017.

Dr Cash $891,540

[ (381 × $2,340) = $891,540]

Dr Warranty Expense $127,254

Cr Sales Revenue $891,540

Cr Warranty Liability $127,254

(381 *[$142+ $192])

B. Calculation for What liability relative to these transactions would appear on the December 31, 2017,

Riverbed Corporation

Balance Sheet (Partial)

December 31, 2017

Current Liabilities

Warranty Liability $63,627

($127,254/2)

Long-term Debt

Warranty Liability $63,627

C. Preparation of the journal entry Record any necessary journal entries in 2018

Dr Warranty Liability 61,300

($21,400+$39,900)

Cr Inventory 21,400

Cr Salaries and Wages Payable 39,900

5 0
3 years ago
A recent consumer survey conducted for a car dealership indicates that, when buying a car, customers are primarily concerned wit
Gemiola [76]

Answer: a. communication, courtesy, and credibility

Explanation:

The Consumer survey showed that when buying a car customers are interested in the salesperson's ability to explain what the car does and what it's has, in short it's features. This means that they would like a Salesperson that Communicates effectively, the need for the car.

Dealers should therefore be very concerned with the communication skills of their sales people.

The Consumers would also like a friendly person. This is simple Courtesy. The sales person must be able to show courtesy to the customers to entice them to buy a car and so Dealership management should be very worried about this.

A final thing the Dealer should be worried about is Credibility. Consumers want to know if the Dealer is credible in that if the claims the dealer is making is true and honest. Too many salespersons say anything to get people to buy things even if it is a lie. A car is a big investment and so consumers would very much like to avoided being lied to.

5 0
3 years ago
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