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Bigham Corporation, an accrual basis calendar year taxpayer, sells its services under 12-month and 24-month contracts. The corpo

Gnesinka [82]

Answer: 2016= $13,000; 2017= $25,000

Explanation:

for 2016

Income to be recognised in 2016 for 12 months term= Total proceeds x period of service provided (july -december )/ Total contract term

Income to be recognised in 2016= 14,000 x 6months /12months

= 14,000 x 1/2= $7,000

Income to be recognised in 2016 for 24 months term= Total proceeds x period of service provided (july -december )/ Total contract term

Income to be recognised in 2016= 24,000 x 6months /24months

= 24,000 x 1/4= $6,000

income to be recognized in taxable income in 2016= $7,000 + $6,000= $13,000

for 2017

Income to be recognised in 2017 for 12 months contract term= Total proceeds x remaining period of service provided from jan. to june 2017 / Total contract term

Income to be recognised in 2017= 14,000 x 6months /12months

= 14,000 x 1/2= $7,000

Income to be recognised in 2017 for 24 months contract term= Total proceeds x remaining period of service provided fromjuly 2016 -dec 2017/ Total contract term

Income to be recognised in 2016= 24,000 x (24-6) 18months /24months

= 24,000 x 3/4= $18,000

income to be recognized in taxable income in 2017= $7,000 + $18,000= $25,000

7 0

4 years ago

The Carter Corporation makes products A and B in a joint process from a single input, R. During a typical production run, 50,000

klemol [59]

Answer: $54,000 per production run

Explanation:

As we are dealing with the decision of whether or not to process the good further, the irrelevant cost would be the cost of producing product B from input R.

This is because this cost has already been incurred to produce product B and so is a sunk cost. Sunk costs are irrelevant to the decision to process further.

30,000 units of B were made from 90,000 units R so the cost of B is:

= 30,000 / 50,000 * 90,000

= $54,000

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<em>The options here are probably for a variant of this question.</em>

8 0

3 years ago

Which of the following statements is FALSE regarding financial and nonfinancial measures of performance?a.Nonfinancial measures

faltersainse [42]

Answer:

D. Financial measures are lead indicators of future success.

Explanation:

This is said to be not true regarding financial and non financial measures of performance.

Businesswise, it is often debated whether a commonly perceived good company, as defined by characteristics such as competitive advantage, stable earnings, above-average management, and market leadership, is also a good company in which to invest. While these characteristics of a good company can point toward a good investment, this article will explain how to also evaluate the company's financial characteristics and how to know if a company is a good investment.

8 0

3 years ago

Novak Enterprises reported cost of goods sold for 2020 of $1,338,800 and retained earnings of $5,268,500 at December 31, 2020. N

aalyn [17]

Answer:

$1,258,950 and $5,233,670

Explanation:

The computation is shown below:

For cost of goods sold

= Cost of goods sold - beginning inventory overstated + ending inventory overstated

= $1,338,800 - $114,680 + $34,830

= $1,258,950

Since the ending inventory contains the lesser amount so it would be added and the beginning inventory contains larger amount so it would be deducted

For retained earning

= Retained earning - ending inventory

= $5,268,500 - $34,830

= $5,233,670

3 0

3 years ago

Say one morning you are considering whether to take UBER or riding the train to work. Both mediums would cost you about $4, but

muminat

Answer:

B

Explanation:

The flat fee paid for the train represents sunk cost. sunk cost is cost that is incurred and cannot be recovered. it should not be considered when making future decisions

You value getting to work early, the Uber is faster, so you should take the uber

6 0

3 years ago