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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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Wildhorse Corporation factors $266,800 of accounts receivable with Kathleen Battle Financing, Inc. on a with recourse basis. Kat

Blababa [14]

Answer:

Denit Cash for $250,792; Debit Due from factors for $10,672; Debit Loss on Sale of receivables for $9,986; Credit Recourse liability for $4,650; and Credit Accounts receivable for $266,800.

Explanation:

The following are calculated first before preparing the journal entry:

Cash received = Factored amount * (100% - Finance charge percentage - Percentage reserved for probable adjustments) = $266,800 * (100% - 2% - 4%) = $250,792

Due from factors = Factored amount * Percentage reserved for probable adjustments = $266,800 * 4% = $10,672

Loss on Sale of receivables = (Factored amount * Finance charge percentage) + Fair value of recourse liability = ($266,800 * 2%) + $4,650 = $9,986

The journal entry will now appear as follows:

Date Account Titles and Explanation Debit ($) Credit ($)

15 Aug 2014 Cash 250,792

Due from factors 10,672

Loss on Sale of receivables 9,986

Recourse liability 4,650

Accounts receivable 266,800

(To record the sale of receivables.)

5 0

3 years ago

Eli has annual earnings of $100,000 and Molly has annual earnings of $50,000. Each consumer goes to the mall and purchases a mic

Damm [24]

Answer:

The correct option is A

Explanation:

Regressive tax is the kind of tax which is imposed or held in such a way or method, that the rate of tax decreases or falls as the amount subject to the taxation rises.

It describe the effect of distribution on the expenditure or on the income of the person, as the rate progresses or increases from high to low, so that it could make average tax rate increases or exceeds the marginal tax rate.

So, in this case, when both of went to purchase the oven, they have to pay extra 7%, in sales tax, which is a regressive tax.

5 0

4 years ago

Maribel is a manager of a manufacturing firm. Her job is to structure the human and other resources of the firm so that the firm

Firlakuza [10]

Answer:

Maribel is involved in the management function of Operation

Explanation:

The operation manager of a company is responsible for the overall operational well being of the company.

They not only play an important role in defining the human resource structure,to conflict resolution,inventory management, and are involved in setting policies and guidelines for accomplishing business goals

The operational manager should not only have people management skills but also be well versed with the budgeting,Accounting software's,should also have knowledge about the manufacturing tools.

8 0

3 years ago

Use the following information to determine this company's cash flows from financing activities.

ludmilkaskok [199]

Answer: Net cash used/ spent was $193,000

Explanation:

Cash from Financing activities involves cash transactions in relation to Equity (including dividends paid) and long term debt as these are the chief providers of cash to finance the business.

Cash from financing activities is:

= Issuance of common stock - Dividend - Settlement of Note payable - Treasury stock purchase

= 73,000 - 18,000 - 130,000 - 118,000

= -$193,000

7 0

3 years ago

In a given year, Jennifer earns $50,000 and spends $40,000. During the same period, Stcve earns $30,000 and spends $27,000. If J

elena55 [62]

Answer:

The sales tax is regressive with respect to income

Explanation:

sales tax by Jennifer = 0.1*30000

= 3000

tax/income = 3000/50000

= 6%

sales tax by steve = 0.1*27000

= 2700

tax/income = 2700/30000

= 9%

The tax increases with decrease in income, it indeed is regressive on the whole.

Therefore, The sales tax is regressive with respect to income

6 0

3 years ago