Answer:
Option A,$72000
Explanation:
Bad debt expense is computed on the net credit sales amount, in other words, the bad debt expense is 12% of credit sales of $600,000.
Bad debt expense=$600,000*12%
=$72000
Option C is wrong because the answer was arrived at by calculating 12% of $750,000 the net sales amount that also has cash sales of $150,000 included in it($750000-$600000)
Option B is wrong as the amount of sales returns and allowances of $50,000 was deducted from $600,000 prior to applying 12% allowance for bad debt
Answer:
C) Operating, $12,000; financing $6,000.
Explanation:
Interests expenses do no change the notes payable or bond, but results in the reduction of the cash flow of a company. Therefore, the interests paid on both short terms notes payable and interest on long-term bonds will appear under the operating activities section of the cash flow statement.
Dividend appears under the financing activities section of the cash flow statement.
For this question, we therefore have:
Cash outflows from operating activities = Interest on short-term notes payable + Interest on long-term bonds = $2,000 + $10,000 = $12,000
Cash outflows from financing activities = Dividends on common stock = $6,000
Therefore, the correct option is C) Operating, $12,000; financing $6,000.
Answer:
$7,176,000
Explanation:
We will calculate the sbsidiary net gain and add it to the firm income to get the consolidated net income:
Little income 864,000
amortization on acquisition investment <u> (48,000) </u>
net gain on subsidiary 816,000
Big income 6,360,000
big income + income from subsidiary = 6,360,000 + 816,000 = 7,176,000
This will be the consolidated net income.
The dividends do not impact the net income.
Complete Question:
Which of the following is correct?
a. Short run fluctuations in economic activity happen only in developing countries.
b. During economic contractions most firms experience rising profits.
c. Recessions come at irregular intervals and are easy to predict.
d. When real GDP falls, the rate of unemployment generally rises.
Answer:
d. When real GDP falls, the rate of unemployment generally rises.
Explanation:
Real Gross Domestic Products (GDP) measures economic activity and income in a particular country.
Consequently, when real Gross Domestic Products (GDP) falls, the rate of unemployment generally rises because the total market value of goods and services in that country has fallen.
Freedom of individual choice is possible to the extent that the market provides options for work, developing a business, and purchasing goods and services (so long as you can afford them).
Hope this helps :)
