Answer:
Common Stock 100,000
Retained Earnings 425,000
Total 525,000
Explanation:
Paradise Travel Service Statement of Net Income
Fees Earned : 900,000
Less Office Expense : (300,000)
Less Miscelleaneous Expenses :( 15,000)
Less Wages expense (450,000)
Net Earnings 135,000
Paradise Travel Service statement of stockholders’ equity for the year ended May 31, 20Y6
Common stock Retained Earning Total
Balance Jan 1 60,000 300,000 360,000
Additional Invested capital
40,000 - 40,000
Net Income :
- $135,000 $135,000
Less Dividends paid
- ($10,000) ($10,000)
Balance, May 31 20y6
100000 425000 525000
Common Stock 100,000
Retained Earnings 425,000
Total 525,000
Answer:
D. $20,240
Explanation:
Adjusted balance should be reported in the balance sheet as on August 31.
Adjusted Cash Balance calculation
Cash balance as per books August 31 $18,900
Add:
Note collected by bank for the Colt Company $1,500
Less:
NSF check ( $110 )
Bank service fees <u> ( $50 ) </u>
Adjusted Balance of cash account $20240
*The Following adjustments are already included in the Cash account balance so, these do not need any settlement in cash account.
Checks outstanding $4,500
Deposits outstanding 4,000
Answer:
A loss of $1400
Explanation:
The double-declining method uses twice the straight-line depreciation method rate in calculating the depreciation amount.
The asset has a useful life of 5 years. The straight-line depreciation rate = 1/5 x 100
=20%.
The double-declining rate will be 40%
The depreciation schedule for two years will be as follows.
Open. Bal Dep. rate Dep. Amount Book value
$27,500 40% $11,000 $16,500.00
$16,500 40% $6,600 $9,900.00
The equipment was sold for $8,500
net gain or loss will be the selling price - book value
=$8,500 - $9,900
=- $1,400
A loss of $1400
Coupon rate on the bonds can be calculated in the following way.
Explanation:
To find the coupon rate of the bond. All we need to do is to set up the bond pricing equation and solve for the coupon payment as follows:
P = $958 = C(PVIFA₆.₄₀%,11) + $1,000(PVIF₆.₄₀%,11)
Solving for the coupon payment, we get:
C = $58.57
The coupon payment is the coupon rate times par value. Using this relationship, we get:
Coupon rate = $58.57/$1,000
Coupon rate = .0586, or 5.86%
Calculator Solution:
Enter 11 6.40 ±$958 $1000
N l/Y PV PMT FV
$58.57
Coupon rate = $58.57/$1,000
Coupon rate = .0586, or 5.86%