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3 years ago

Ignoring any related tax implications, what is the effect on a company's balance sheet when depreciation expense is recognized?

Business

1 answer:

Volgvan3 years ago

5 0

Answer:

When depreciation is recorded in the financial books, it has two impacts as for income statement it reduces the income, which turns to be part of owner's equity later as retained earnings or profit for the year. Further, on balance sheet assets side after that there is an negative impact on the carrying value of fixed assets on which depreciation is charged, and accordingly the balance of fixed assets is decreased.

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On November 1, 2019, Gordon Co. collected $31,800 in cash from its tenant as an advance rent payment on its store location. The

Morgarella [4.7K]

Answer:

a. HORIZONTAL METHOD

INCOME STATEMENT

date Income $ - Expenses $ = net income

1 Nov - - - - -

b. adjusting

31 each rent 5,300 - - 5,300

month

c. BALANCE SHEET AS AT 31 DEC

Assets = Equity + Liabilities

+ bank $84,800 - prepaid expense +$84,800

Explanation:

on 1 Nov there is no entry for the amount in the income statement because it is not yet earned only the balance sheet is affected + bank $31800 and + income received in advance ( liability) $31800

each month's rent = $31800/ 6month =$5300

18 months rent = 95400

unearned at december = 18 months - 2 months earned

= 95400- 10600

=$84,800

3 0

3 years ago

_____ must verify in writing the accuracy of their corporation's financial statements.

grin007 [14]

Chief operating officers (COO) and chief financial officers (CFO) must verify in writing the accuracy of their corporation's financial statements.

Answer: D)

3 0

3 years ago

If ABC corporation paid a dividend of $6 per share last year. The stock currently sells for $80 per share. You estimate that the

krok68 [10]

Answer:

option (e) 13.95%

Explanation:

Data provided in the question:

Dividend paid, D0 = $6 per share

Current selling price = $80 per share

Dividend growth rate = 6% = 0.06

Now,

Cost of equity = [ D1 ÷ Current price] + Growth rate

= [ ( D0 × (1 + g) ) ÷ $80 ] + 0.06

= [ ( $6 × (1 + 0.06) ) ÷ $80 ] + 0.06

= [ 6.36 ÷ $80 ] + 0.06

= 0.1395

= 0.1395 × 100%

= 13.95%

Hence,

The correct answer is option (e) 13.95%

6 0

4 years ago

Entries for Receipt and Dishonor of Note Receivable Journalize the following transactions of Trapper Jon’s Productions. Assume 3

Anarel [89]

Answer:

See explanation section.

Explanation:

June 23, Notes receivable Debit = $48,000

Accounts receivable Credit = $48,000

To record the note receivable from Radon Express.

September 21, Accounts receivable Debit = $48,960

Notes receivable credit = $48,000

Interest revenue = $960

Calculation: Interest revenue = [($48,000 × 8%) ÷ 360] × 90 = $960

To record the dishonor of Note Receivable.

October 21, Cash Debit = $49,368

Accounts receivable Credit = $48,960

Interest revenue Credit = $408

Calculation: Interest revenue = [($48,960 × 10%) ÷ 360] × 30 = $408

To record the received of previously dishonored Notes Receivable with a 10% interest.

4 0

4 years ago

53. Blue Technologies manufactures and sells DVD players. Great Products Company has offered Blue Technologies $22 per DVD playe

Annette [7]

Answer:

Accept, because operating income would increase $120,000

Explanation:

The computation of given situation is shown below:-

Sales = $22 × 10,000

= $220,000

Variable cost = $10 × 10,000

= $100,000

= Sales - Variable cost

= $220,000 - $100,000

Increase in operating income = $120,000

Therefore, the correct answer is Increase in operating income $120,000. So, the option is not available in the question.

5 0

4 years ago