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3 years ago

The following balance sheet for the Hubbard Corporation was prepared by the company:

Business

1 answer:

crimeas [40]3 years ago

3 0

Answer:

HUBBARD CORPORATION

Balance Sheet

At December 31, 2021

Assets

Current assets:

Cash $63,000

Accounts receivable (net) $126,000

Inventory $163,000

Short term investments - AFS securities $23,000

Total current assets: $375,000

Investment in equity securities $43,000

Patent (net) $103,000

Machinery $283,000

Assets Buildings $753,000

Accumulated depreciation ($258,000)

Land $186,000

Total assets $1,485,000 

Liabilities and Shareholders' Equity

Current liabilities:

Accounts payable $218,000

Current portion of long term debt $32,500

Total current liabilities: $250,500

Notes payable 473,500

Common stock (authorized and issued 103,000 shares of no par stock) $412,000

Retained earnings $349,000

Total liabilities and shareholders' equity $1,485,000

Explanation:

1. The buildings, land, and machinery are all stated at cost except for a parcel of land that the company is holding for future sale. The land originally cost $53,000 but, due to a significant increase in market value, is listed at $126,000. The increase in the land account was credited to retained earnings.

Dr Retained earnings 73,000

Cr Land 73,000

Assets must be reported at historical cost.

2. The investment in equity securities account consists of stocks of other corporations and are recorded at cost, $23,000 of which will be sold in the coming year. The remainder will be held indefinitely.

Dr Short term investments - AFS securities 23,000

Cr Investment in securities 23,000

It doesn't change the value of the assets, it just organizes them properly.

3. Notes payable are all long term. However, a $130,000 note requires an installment payment of $32,500 due in the coming year.

Dr Notes payable 32,500

Cr Current portion of long term debt 32,500

4. Inventory is recorded at current resale value. The original cost of the inventory is $163,000.

Dr Inventory change 83,000

Cr Inventory 83,000

Inventory must be recorded at lesser of cost or market value.

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Craft Inc.'s Krayons is a multi-color chalk material that was released in the market over a century ago. Since the release, the

Ahat [919]

Answer:

maturity

Explanation:

The four stages of a product's life cycle are:

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3 years ago

Ivanhoe Company issued $250,000 of 10%, 20-year bonds on January 1, 2022, at face value. Interest is payable annually on January

Ivanshal [37]

Answer:

Dr. Cash $250,000

Cr. Bond Payable $250,000

Explanation:

Bonds issued are the liabilities for the company because it company received cash against the bonds which will be paid at maturity along with the interest.

As cash is an asset and it is being received, to increase the value of cash balance we debited the cash account. The bond is a liability and to add a value in a liability account we need to credit the bond payable account.

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3 years ago

Global Pistons (GP) has common stock with a market value of $ 200$200 million and debt with a value of $ 100$100 million. Inves

kvv77 [185]

Answer:

a. Suppose GP issues $ 100$100 million of new stock to buy back the debt. What is the expected return of the stock after this transaction?

b. Suppose instead GP issues $ 50.00$50.00 million of new debt to repurchase stock. i. If the risk of the debt does not change, what is the expected return of the stock after this transaction?

ii. If the risk of the debt increases, would the expected return of the stock be higher or lower than when debt is issued to repurchase stock in part (i)?

If the risk of the debt increases, then the cost of the debt will increase. Therefore, the company will need to spend more money paying the interests related to the new debt which would decrease the ROE compared to the 18% of (i). Since we do not know the new cost of the debt, we cannot know exactly by how much it will affect the ROE, but I assume it will still be higher than the previous ROE.

Explanation:

common stock $200 million

total debt $100 million

required rate of return 15%

cost of debt 6%

current profits = ($200 million x 15%) + ($100 x 6%) = $30 million + $6 million = $36 million

if equity increases to $300 million, ROI = 36/300 = 12

if instead new debt is issued at 6%:

equity 150 million, debt 150 million

cost of debt = 150 million x 6% = $9 million

remaining profits = $36 - $9 = $27 million

ROI = 27/150 = 18%

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3 years ago

Seating Company is currently selling 1,400 oversized bean bag chairs a month at a price of $95 per chair. The variable cost of

-BARSIC- [3]

Answer:

Contribution Margin Income Statement

+Sales Revenue 1,400 x $95 = $133,000

-Variable production costs 1,400 x $65 = ($91,000)

-Variable selling costs 1,400 x $2 = ($2,800)

=Contribution Margin $133,000 - $91,000 - $2,800

= $39,200

-Fixed production costs ($13,000)

=Net profit = $39,200 - $13,000

= $26,200

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3 years ago

7. How does AJ look tyrannical or monarchical with both the tariff/nullification crisis and Indian removal

lapo4ka [179]

Answer:

Andrew Jackson (AJ for short) was a statesman. He reached the height of this career when he became the 7th President of the United States (POTUS, having served as a soldier and a general in the United States Army). His administration spanned two terms of 4 years each (1829 to 1837)

In direct reference to the question, it can be said that due to his action, he was rather tyrannical than monarchial.

Explanation

On the overall, AJ is regarded by may historians favorably due to his many big wins. Some of those wins which he achieved as POTUS are:

The payment of a long standing national debt
the conclusion of the "most favored nation" treaty with the United Kingdom, which settled claims of damages against France from the Napoleonic Wars,
Prevention of the renewal of the charter of the Second Bank of the United States which was deemed as corrupt established created to enrich the wealthy at the expense of the plebian class and
the recognition Texas as a Republic. It may be worthy of note that he was the first POTUS to have survived an assassination attempt as a sitting president.

Irrespective of the above, his career was marred by two major dents:

The endorsement of the of the 1830 Indian Removal Act which forced many Native American tribes in the South to a space that became known as the Indian Territory. The forceful relocation was deemed necessary by the Blue Bloods (White Population) and resulted in mass suffering, mass death by many who where diseased during the forced relocation.
The Nullification Crises: For some reason, the congress approved a bill which by itself was designed to fail or be disapproved. It placed a huge tariff (as much as 45%, a historic high) on the Southern Cotton Farmers. The bill became known as the "Tariff of Abominations". He later conceded to several downward revisions of the tariff, first to 27% and further downwards later but not after it had caused a lot of rift between the state of South Carolina and the Federal Government where in the South Carolina had declared the bill unconstitutional. This call out against the Federal Government became known as the Nullification Crises.

Cheers

6 0

2 years ago