Under the IRS Method, you allocate more of the interest and taxes to the rental property. As a result, the rental deductions are more than the income and $1,407 of the depreciation deduction is disallowed. ... Decide which method is best for your clients in the first year they deduct rental expenses.
Answer:
a.
Average cost per meal = Variable cost per meal + Fixed cost allocated to one meal sold = $4 + Total fixed cost/ Number of meals sold per day = $4 + 1,200/750 = $5.60.
b.
Price per one meal as per the leader of the Scout = 150/30 = $5
As the selling price is $0.60 lower than the average cost per meal ($5-$5.60), the owner has come up with the loss of $0.60 per meal served under the Scout leader's suggestion.
However, his calculation is not reasonable, because among the $5.60 cost per meal, there is a factor of allocated fixed cost equals to $1.6 per meal which will incurred regardless of the suggestion being accepted or not.
Given his restaurant does not run at full capacity, his profit per one meal from accepting the offer should be calculated as Price per one meal as per Scout leader offer - Variable cost per one meal = $5 - $4 = $1.
Explanation:
Answer:
The holding period return of the stock is - 6 % or - 6.0%
Explanation:
Solution
Given that:
You are thinking of purchasing a stock that currently sells for= $50
The expected price of the stock =$45
Dividend expected to be paid =$2
Risk free rate = 5%
Market return = 10%
Stock (beta) = 0.85
We will now find the holding period return of the stock which is given below:
The formula for calculating the holding period return of a stock is given as,
= The Expected price in a year + Dividend earned during the year – Purchase Price / Purchase Price
We recall that:
The Purchase Price = $ 50
Expected price in a year = $ 45
Dividend earned during the year = $ 2
Now,
By Applying the above values in the formula we have the holding period return of the stock as
:
= [45 + 2 – 50] / 50
= - 3 / 50
= - 0.0600 = - 6.00 %
= - 6.0 % ( when rounded off to one decimal place )
Therefore, the Holding period return of the stock is - 6 % or - 6.0%
Answer:
Capability index = 0.4444
Explanation:
Given:
lower specification limit = 22.8 mm
Upper specification limit = 23.2 mm
The standard deviation = 0.15 mm
Mean = 23 mm
Capability index = ?
Computation of Capability index:
Capability index = minimum of [ 
]
Capability index = minimum of [ 
]
Capability index = minimum of [ 
]
Capability index = minimum of [ 
]
Capability index = 0.4444
Answer:
$4,412
Explanation:
If the company estimates that $4,412 of accounts receivables will be uncollectible, then it must record that number under the Allowance for Bad debts Account.
That account started the year with a $3,284 balance, it decreased by $1,826 (debt written off), and then must be adjusted by crediting $2,954 so its balance = $4,412 on December 31.
