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Artist 52 [7]
3 years ago
11

Play Inc. owns 100% of Station Corp.'s common stocks. On January 1, 2015, Play sold to Station for $50,000 an equipment with a c

arrying amount of $30,000. Station is depreciating the equipment over a 5-year life using the straight-line method. Describe the two adjustments and provide the amounts made in 2015 consolidated income statement.
Business
1 answer:
victus00 [196]3 years ago
5 0

Answer:

There is unrealised profit on the equioment sold by Play inc to Statetion Corp.

the Adjustment include

  • Deduct net unrealised profit of $16,000  from Equipment
  • Deduct net unrealised profit of $16,000 from  Group(consolidated )retained earnings.

Amount to be recognized as unrealized profit in the consolidated income statement is $16,000

Explanation:

Computation of Net unrealized profit

Unrealized profit ( $50,000 - $30,000)                       20,000

Depreciation on Unrealized profit( 20,000/5)              <u>  (4,000</u>)

Net unrealized profit                                                      <u>   16,000</u>

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When a firm declares bankruptcy, Group of answer choices the claims of preferred shareholders are honored before those of the co
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Answer:

the maximum that shareholders can lose is their original investment in the firm's stock AND the claims of preferred shareholders are honored before those of the common shareholders.

Explanation:

          Bankruptcy may be defined as the legal proceedings that involves a person or a business where the person or the business firm is not able to repay the debts that are outstanding. When a firm or a person files a bankruptcy, there is an automatic stay put by the court that blocks the debts.

         In case of bankruptcy the different shareholders of the firm losses a maximum of their original investment that they have done in the firm while purchasing the stocks. And also the claims of the preferred shareholders are being honored first than those of common shareholders.

6 0
3 years ago
Betty, a teenager, starts a business selling cupcakes to coffee shops and restaurants. she strives to increase either the market
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I believe this illustrates <span>sales-oriented pricing
The purpose of </span><span>sales-oriented pricing is to increase the total market shares that the company has for a certain type of product.
Large market shares means that the company had the most awareness and obtain a certain advantage compared to other competitors.</span>
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3 years ago
Are shareholders and stakeholder the same thing? Explain your answer...
Whitepunk [10]

Shareholders are always stakeholders in a corporation, but stakeholders are not always shareholders. A shareholder owns part of a public company through shares of stock and a stakeholder has an interest in the performance  of any type of company for reasons other than stock performance or appreciation

5 0
3 years ago
Fashion, Inc. had a Retained Earnings balance of $10,000 at December 31, 2018. The company had an average annual income of $6,00
ololo11 [35]

Answer:

Total Dividend = $20000

Explanation:

Total Income for 3 Years = 3*Average income

                                            = 3* 6000 = $18000

Opening Retained Earnings $10,000

Closing Retained Earnings $13,000

Net Utilisation for Dividend = 13000 - 10000 = $2000

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3 years ago
Dixon Company is a manufacturer that completed numerous transactions during the month, some of which are shown below:
ale4655 [162]

Answer:

Explanation:

From the question, we are told to

select "No" if it would not affect Retained Earnings. Conversely if the transaction would affect Retained Earnings, then record the amount of the increase or (decrease) to this account under the "Yes" column.

Retained Earnings

Retained Earnings is the remaining income in total that a company/organization has after she has paid dividents to her shareholders and all expenses.

Note that: whenever, there is rise or fall in net income as well as the dividends given shareholders, the Retained earnings are affected, which means anything that bring about increase or decrease of net income definitely affect retain earning.

""When the dividend given to shareholders

or other expenses is less that net income for the company ,then it means

increase in retain earning and vice versa.""

A)NO, it would not affect Retained Earnings.

This is raw material needed for the business

B)NO, it would not affect Retained Earnings.

C)yes,it would affect Retained Earnings by decrease of (-45,000)

D)yes, it would affect Retained Earnings by decrease of(-21,000)

E)yes, it would affect Retained Earnings by increase of(450,000)

F))NO, it would not affect Retained Earnings

G)NO, it would not affect Retained Earnings

H)NO, it would not affect Retained Earnings

I)NO, it would not affect Retained Earnings

J) yes, it would affect Retained Earnings by decrease of(-220,000)

K)NO, it would not affect Retained Earnings

3 0
3 years ago
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