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allsm [11]
3 years ago
12

During the taking of its physical inventory on December 31, 2014, Barry's Bike Shop incorrectly counted its inventory as $225,51

3 instead of the correct amount of $170,230. The effect on the balance sheet and income statement would be ________.
Business
1 answer:
Kryger [21]3 years ago
6 0

Answer:

The inventory would be increased by $55,283 and the profit has been decreased by the same amount.

Explanation:

The reason is that the closing inventory has been increased by the difference of the correct and incorrect amount which is:

Closing inventory difference = $225,513 - $170,230 = $55,283

This will increase the closing inventory in the balance sheet and the increase in the closing inventory will decrease the cost of goods sold. The lower the cost of goods sold the greater is the profit.

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Sarai spends her day checking through boxes of built product to ensure accuracy in production. She makes sure there is enough pr
kondaur [170]
<h2>Quality controller or Quality Checker is the job title of Sarai.</h2>

Explanation:

The role of QC is

  • To check whether the product is delivered with the expected quality
  • To check for expectations and complaints from the customer
  • Look for new policy changes and compare that with the day today production.
  • Reads blue prints and specification of the product
  • Monitors operations
  • Inspects and test the product
  • Identify re-works and again continue the process of QC
  • Accept or reject the finished good
6 0
3 years ago
Read 2 more answers
On November 1 of year 0, Jaxon borrowed $50,000 from Bucksnort Savings and Loan for use in his business. In December, Jaxon paid
Stels [109]

Answer:

a. $750

b. $750

Explanation:

The first thing to do is calculate the monthly interest as follows:

Monthly interest = Total interest ÷ 12 = $4,500 ÷ 12 = $375

The rent for two months in year 0 (November and December) = $375 × 2 = $750.

Prepaid expenses (January to October of year 1) = $4,500 - $750 = $3,750.

Decision:

Prepaid expenses is not deductible under either cash accounting method or accrual accounting method for tax purposes.

Therefore, Jaxon can deduct only $750 two months (November and December) relevant for year 0 under both cash accounting method and accrual accounting method.

The prepaid expenses of $3,750 is not deductible in year 0 but can only be deducted in year 1.

4 0
3 years ago
Rossdale Co. stock currently sells for $72.87 per share and has a beta of 1.22. The market risk premium is 7.10 percent and the
Paul [167]

Answer:

Cost of Equity =11.56%

Explanation:

The cost of equity can be determined using any of the following methods:

  1. The Dividend Valuation Model(DVM)
  2. Capital Asset Pricing Model (CAPM)

The Dividend Valuation Model(DVM) is a technique used to value the worth of an asset.

According to this model, the value of an asset is the sum of the present values of the future cash flows would that arise from the asset discounted at the required rate of return.  

Price = D/Kp

D- Dividend payable

Kp- cost of preferred stock

The capital asset pricing model (CAPM): relates the price of a share to the market risk or systematic risk. The systematic risk is that which affects all the all the economic agents, e.g inflation, interest rate e.t.c  

This CAPM is considered superior to DVM because it incorporates risk. Hence, we will use the CAPM  

Using the CAPM , the expected return on a asset is given as follows:  

E(r)= Rf +β(Rm-Rf)  

E(r) =? , Rf- 2.90%, Rm-Rf- 7.10% β- 1.22

E(r) = 2.90% + 1.22×(7.10)% = 11.562  %

Cost of Equity =11.56%

7 0
3 years ago
As pilar is trying to communicate to miguel his error in going over budget, pilar is considered the _____ in the communication p
Ganezh [65]
<span>Pilar is considered the sender in this case. He is the person putting out the messages that Miguel, as the receiver, needs to attend to, receive, and understand. Pilar needs to communicate these messages in a form that will be recognizable and can be replied to for proper communication to have taken place.</span>
5 0
3 years ago
In 2018, Caterpillar Inc. had about 595 million shares outstanding. Their book value was $23.00 per share, and the market price
sashaice [31]

Answer and Explanation:

The computation is shown below;

(a)-Caterpillar’s book debt-to-value ratio

Caterpillar’s book debt-to-value ratio is

= Debt ÷ [Debt + Book Value of Equity]

= $24.80 Billion ÷ [$24.80 Billion + (0.595 Billion Shares × $23.00 per share)]

= $24.80 Billion ÷  [$24.80 Billion + $13.69 Billion]

= $24.80 Billion ÷ $38.49 Billion

= 0.64

(b)- Caterpillar’s market debt-to-value ratio

Caterpillar’s book Market debt-to-value ratio is

= Debt ÷ [Debt + Market Value of Equity]

= $24.80 Billion ÷ [$24.80 Billion + (0.595 Billion Shares × $154.80 per share)]

= $24.80 Billion ÷ [$24.80 Billion + $92.11 Billion]

= $24.80 Billion ÷ $116.91 Billion

= 0.21

(c)-Best measure to determine the company’s cost of capital is the market value  

8 0
3 years ago
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