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mash [69]
3 years ago
5

Never, Inc., earns book net income before tax of $500,000. In computing its book income, Never deducts $50,000 more in warranty

expense for book purposes than is allowed for tax purposes. Never records no other temporary or permanent book-tax differences. Assuming that the U.S. tax rate is 21% and no valuation allowance is required, what is Never's deferred income tax asset reported on its GAAP financial statements? a.$105,000 b.$94,500 c.$10,500 d.$115,500
Business
1 answer:
goldenfox [79]3 years ago
8 0

Answer:

c.$10,500

Explanation:

The computation of the deferred income tax asset is shown below:

= Warranty expense for book purposes  × U.S tax rate

= $50,000 ×21%

= $10,500

For computing the deferred income tax asset reported, we simply multiply the warranty expense with the U.S tax rate.

Hence, we ignored the net income before tax as it is an irrelevant part which is given in the question

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Non-toxic-toys currently has $400,000 of equity and is planning a $160,000 expansion to meet increasing demand for its product.
Rashid [163]

Answer:

1. $100,000 and 25%

2. $137,200 and 34.3%

3. $150,000 and 27%

Explanation:

1. It does not expand

    a. Net income= $100,000 (as given in the question)

    b. Return on equity= (net income)/(shareholder’s equity)

Shareholder’s equity= $400,000

Thus return on equity= 100000/400000 = 0.25  or 25%

2. It expands and issue $160,000 in debt

    a. Net income= $100000 + 50000 –  12800 (debt interest 8% of     $160000)

= $137,200

b. Return on equity= (net income)/(shareholder’s equity)

= 137200/400000

=0.343  or 34.3%

3. It expands and raises equity of $160000

a. Net Income= $100000 + 50000

= $150000

b. Return on equity= (net income)/(shareholder’s equity)

= 150000/(400000 + 160000)

Where ($560,000) 400000 + 160000 is shareholder’s equity

= 0.27 or 27%

5 0
3 years ago
Answer the question on the basis of the accompanying production possibilities tables for two countries, Latalia and Trombonia.
Scilla [17]

The production possibility table shows that in Latalia the domestic real cost of 1 ton of pork is C. 5 tons of beans.

<h3>What is production?</h3>

It should be noted that production simply means the creation of goods and services for consumers.

In this case, production possibility table shows that in Latalia the domestic real cost of 1 ton of pork is 5 tons of beans. This is because 5 tons of beans will be sacrificed to produce the pork.

Learn more about production on:

brainly.com/question/16755022

5 0
2 years ago
what do you do if a caller needs a particular question answered and you're completely uncertain about who the caller should cont
barxatty [35]
(D) ask the callers name, number, and purpose of the call and tell him or her someone will call back in a few minutes.
The other answers do not look professional,as for answer D, the caller will feel you really care about him or her, since you have taken their contact detail and you have assured them someone will call them back shortly. It shows as a business you but your callers need first.
5 0
3 years ago
Droz's Hiking Gear, Inc. has found that its common equity capital shares have a beta equal to 2.5 while the risk-free return is
11111nata11111 [884]

Answer:

see explanation

Explanation:

Weighted Average Cost of Capital (WACC) is the cost of a firm from permanent sources of capital pooled together.

WACC = Cost of equity x Weight of equity + Cost of Debt x Weight of Debt + Cost of Preference Stock x Weight of Preference Stock

where,

Cost of equity = Return on Risk free rate + Beta x Risk Premium

                        = 9.00 % + 2.5  x (14.00 % - 9.00%)

                        = 21.50 %

Cost of debt :

<em>similar</em>

N = 7 x 2 = 14

p/yr = 2

pmt = ($787.22 x 8%) ÷ 2 =

fv = $787.22 x number of bonds

pv = $80,000,000

<u>Always use the after tax cost of debt :</u>

after tax cost of debt = interest x ( 1 - tax rate)

7 0
3 years ago
Suppose the United States has a Gini coefficient of 0.4 and Sweden has a Gini coefficient of 0.25. Which of the following statem
yarga [219]
The correct answer is C
6 0
3 years ago
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