Answer:
truck 26,000 debit
note payable 26,000 credit
interext expense 130.00 debit
note payable 480.61 debit
cash 610.61 credit
Explanation:
<u>issuance: </u>
we record the entry of the truck into the books and we also record the promissory note signed.
<u>interest payment:</u>
principal x rate x time = interest
being rate 6% annual
and payment monthly we convert the rate:
6% = 0.06 annual --> 0.06/12 = 0.005 monthly --> 0.5%
26,000 x 0.5% = 130
610.61 - 130 = 480.61
I think the Awser is maybe d BUT NOT SURE!:)
Answer:
a. Calculate the balance in retained earnings at the time of the change (beginning of 2017) as it would have been reported had FIFO been previously used.
b. Prepare the journal entry to record the change in accounting principle at the beginning of 2017.
- Dr Inventory 80,000
- Cr Income taxes payable 16,800
- Cr Retained earnings 63,200
Explanation:
inventory under FIFO would have been $80,000 higher, that means that COGS were overstated by $80,000 and net earnings were understated by $80,000.
retained earnings 2016 = $1,750,000
tax rate 21%
Dr Inventory 80,000
Income taxes payable 16,800
Retained earnings 63,200
Retained earnings = $1,750,000 + $63,200 = $1,813,200
When companies change from LIFO to FIFO, they must adjust their income statement and balance sheet in a prospective way because it will affect the future value of their accounts. But when a company changes from FIFO to LIFO, no adjustment is required.
Suppose that a worker earns x$ every other month. In September he earns 5x. We have that his total earnings are 11*x +5x (Eleven months income plus September). Hence 16x is the amount of total earnings. The ratio of earnings in September to the total earnings is
=0.3125. Hence, 31,25% of his earnings where accrued in September.