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Stella [2.4K]
3 years ago
6

On June 1, 2021, Wildhorse & Sons sold equipment to James Landscaping Service in exchange for a zero-interest bearing note w

ith a face value of $106800, with payment due in 12 months. The fair value of the equipment on the date of sale was $90000. The amount of revenue to be recognized on this transaction in 2021 is
a. $106800.
b. $16800.
c. $90000.
d. $90000 sales revenue and $9800 interest revenue.
Business
1 answer:
Alja [10]3 years ago
8 0

Answer:

d. $90000 sales revenue and $9800 interest revenue.

Explanation:

Note will be recorded on the fair value of equipment and the net difference of the zero interest bearing bond and the fair value of he equipment will be recorded as the interest income.

Amount of sale = $90,000

Interest amount = $106,800 - $90,000 = $16,800

As only 7 months have been passed until end of 2021 from the date of sale

only interest of 7 months is recognized.

Interest income recognised in 2021 = $16,800 x 7 /12 = $9,800

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C is the correct answer
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3 years ago
The Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and Assembly.
katen-ka-za [31]

Answer:

Allocated MOH per unit= $45.94

Explanation:

Giving the following information:

Product Number of Units Labor Hours Per Unit

Blinks 1,178 2  

Dinks 2,060 3

Estimated overhead costs for the period= 108,300 + 87,800= $196,100

Total direct labor hours= (1,178*2) + (2,060*3)= 8,536

<u>First, we need to calculate the predetermined overhead rate:</u>

Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Predetermined manufacturing overhead rate= 196,100 / 8,536

Predetermined manufacturing overhead rate= $22.97 per direct labor hour

<u>Now, we allocate overhead to Blinks:</u>

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Allocated MOH= 22.97*2= $45.94

5 0
3 years ago
Which of the following most accurately states the economic significance of exchange? a. Physical goods have value because they e
Annette [7]

Answer:

c. Exchange creates value by moving goods from parties who value them less to parties who value them more.

Explanation:

Exchange is described as the process of changing some goods for some other goods.

Exchange clearly provides you with the goods you value for, and in exchange for those goods you pay the goods you do not value.

This, results in adding value to the goods acquired by you, and adds value to the goods given by you for the person to whom it is exchanges.

As for example when a cloth is purchased by me for $100 then such adds the value to cloth and because it was worth less than $100 for the seller it has added value to the cloth.

6 0
3 years ago
Shock Electronics sells portable heaters for $35 per unit, and the variable cost to produce them is $22. Mr. Amps estimates that
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Break-even point in units is 7,500 unit

<u>Given that;</u>

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Variable cost of each heater = $22

Fixed cost = $97,500

<u>Find:</u>

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<u>Computation:</u>

Contribution = Sales - VC

Contribution = $35 - $22

Contribution = $13

Break-even point in units = Fixed cost / Contribution

Break-even point in units = 97,500 / 7

Break-even point in units = 7,500 unit

Learn more:

brainly.com/question/22871926?referrer=searchResults

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2 years ago
A large computer hardware manufacturer
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Answer:

I guess horizontal merger

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