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2 years ago

On May 1, Tango Co. agreed to sell the assets of its Formal Wear Division to Top Hat Inc.

Business

2 answers:

wariber [46]2 years ago

5 0

Answer:

For the year ended December 31, 2021, Tango would report:

Fair value of the assets = $40 million

Carrying Amount = $48 million

lower of the 2 values is fair value, which would reduce the carrying amount and result in impairment of $8 million which would be recognized in the income statement.

This expense is recognized in the income statement + pre-tax loss

= $8 million + $10 million = $18 million

less tax(25%) = $4.5 million

Total loss from discontinued operation = $18 million - $4.5 million = $13.5 million

Explanation:

As at December 31, 2021, the Division's assets were considered held for sale.

Therefore, the assets should be measured at the lower of carrying amount and fair value less costs to sell (IFRS 5 -Non-current Assets Held for Sale and Discontinued Operations) with a recognition of any arising impairment.

Any impairment loss that arises by using the measurement principles in IFRS 5 must be recognized in profit or loss.

beks73 [17]2 years ago

3 0

Answer:

This gives a net losses from discontinued of operations of $13.5m

After having deducted tax benefit of $4,5m

Explanation:

Kindly find attached spreadsheet showing of the computations from US GAAP's perspective

Mind the use of formulas highlighted before each calculation

Download xlsx

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6. The money multiplier formula shows effects of

horrorfan [7]

Answer: a cash deposit into banking system on the money supply

The money multiplier refers to the ratio of deposits to the reserves in a certain banking system. The money multiplier formula is caused by a cash deposit in a bank on the money supply.

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3 years ago

On April 1, 2013, Four Seasons Landscaping, LLC purchased new lawn mowers for $70,000 in cash (total cost). They have a useful l

creativ13 [48]

Answer:

Please see the calculation explanation below and the depreciation expense chart for all methods is attached.

Explanation:

1. STRAIGHT-LINE DEPRECIATION METHOD:

Depreciation Expense = (Total Cost - Residual Value) / Useful Life

Depreciation Expense = ($70,000 - $10,000) / 3 years

Depreciation Expense = $60,000 / 3 years

Depreciation Expense = $20,000 per year

2. DOUBLE DECLINING BALANCE DEPRECIATION METHOD:

Depreciation Expense Rate = (100% / Useful Life) x 2

Depreciation Expense Rate = (100% / 3) x 2

Depreciation Expense Rate = 66.67%

2013: 

Depreciation Expense = $70,000 x 66.67% = $46,667

2014: 

Depreciation Expense = ($70,000 - $46,667) x 66.67% = $15,556

Since the residual value is $10,000 and as per Double Declining Balance Method, the point at which Book Value is equal to the residual value, no depreciation is taken.

Depreciation Expense = (Total Cost - Residual Value) - (Accumulated Depreciation)

Depreciation Expense = ($70,000 - $10,000) - ($46,667)

Depreciation Expense = $13,333

2015: 

No Depreciation Expense for year 3, as Book value is already equal to residual value in year 2.

3. PER HOUR DEPRECIATION METHOD:

2013:

Depreciation Cost per hour = (Engine Hours in 2013 / Total Engine Hours) x (Total Cost - Residual Value)

Depreciation Cost per hour = (500 / 1,200) x ($70,000 - $10,000)

Depreciation Cost per hour = $25,000

2014: 

Depreciation Cost per hour = (Engine Hours in 2014 / Total Engine Hours) x (Total Cost - Residual Value)

Depreciation Cost per hour = (400 / 1,200) x ($70,000 - $10,000)

Depreciation Cost per hour = $20,000

2015: 

Depreciation Cost per hour = (Engine Hours in 2015 / Total Engine Hours) x (Total Cost - Residual Value)

Depreciation Cost per hour = (300 / 1,200) x ($70,000 - $10,000)

Depreciation Cost per hour = $15,000

6 0

2 years ago

Buerhle Company needs to determine if its indefinite-life intangibles other than goodwill have been impaired and should be reduc

Vera_Pavlovna [14]

Answer:

Option C Not recoverability test but fair value test

Explanation:

The reason is that the standard on impairment IAS 36 Impairment of Assets says that the assets with indefinite life must tested for impairment every accounting year end. The test only includes whether the fair value of the asset has been decreased or not. This test is helpful by asking questions that asks about the decrease in the life of the asset due to a new legislation, the performance of the asset is fallen (oil is less extracted now than before because the oil is not reachable), etc. The standard does not permits to use Recoverability test as it will come later once the company is sure that the asset fair value has been decreased.

8 0

3 years ago

Sony has sold the same number of television sets each month for almost a year. However, in one month that number suddenly double

Inessa05 [86]

Answer:

C. Reduced prices of Sony televisions resulted in an increase in the quantity demanded.

Explanation:

Sony is a well known brand . What could explain a sudden double increase in sales while other brands' didn't is most likely a reduction in in prices of Sony products. It is a well known brand and they sell quality products which customers trust. Having a discounted price means they are offering a sale which customers would want to take advantage of.

3 0

2 years ago

Total revenue decreases as the price of a good increases. true or false

Ipatiy [6.2K]

Answer: False

Explanation:

Total Revenue is the total amount that is received in return on sales of goods and services.

It is calculated as Price multiply by Quantity.

If the price of a product increases the revenue would also increase ceteris paribus( all things being equal). If the price of a product was $10 and 4 units were purchased Total revenue would be $40 and if price increases to $20 and 4 units were still purchased total revenue would be $80 assuming that we’re not taking into consideration any other factor like elasticity or type of good.

If price increases revenue increases too.

8 0

2 years ago