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LuckyWell [14K]
3 years ago
7

Pitbull Construction Corporation applies IFRS, has equipment that it can reliably measure fair value of, and has chosen to apply

the revaluation model to valuing this equipment on its accounting records. The carrying value of this equipment on Pitbull's books at the end of last year, December 31, 20X1, was $200,000. At the end of this year, December 31, 20X2, due to decreased demand for the equipment, especially when resold as used, the fair value is $150,000. For the year 20X2, in relation to this equipment for which Pitbull has chosen to apply the revaluation method, Pitbull must:_________
Business
1 answer:
IRINA_888 [86]3 years ago
7 0

Answer and Explanation:

If there is decrease in fair value of an asset as is seen in the example with Pitbull corporation, we decrease asset revaluation reserve in the balance sheet by the value reduced $50000 here to recognise new carrying value of the asset and then debit the expenses of revaluation to the income statement or profit and loss account. If there was an increase in fair value, revaluation would add to retained earnings in balance sheet and income in income statement

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Indicate whether the following events might cause stocks in general to change price, and whether they might cause Big Widget Cor
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Answer:

Check the explanation below

Explanation:

Inflation is systematic (Market) risk, it impacts all stocks

Results of company is unsystematic (Specific) risk, as they are as expected stock price wont have much impact

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8 0
3 years ago
If your company doesn't have cash flow, which of these things is
Katen [24]

Answer:

B.

Explanation:

Without money coming into your business you will not be able to pay bills or employees.

5 0
3 years ago
A small business has determined that the machinery they currently use will wear out in 16 years. To replace the new machine when
Vlad [161]

Answer:

The initial deposit should be of: $97,439.62

Explanation:

Giving the following information:

To replace the new machine when it wears out, the company wants to establish a savings account today. The interest rate on the account is 1.9 percent per quarter and the cost of the machinery is $325,000.

To calculate the initial investment required, we need to use a variation on the simple interest future value formula:

FV= PV*(1+i)^n

PV= present value

Isolating PV:

PV= FV/(1+i)^n

i= 0.019

n= 4*16= 64

FV= 325,000

PV= 325,000/ (1.019^64)= $97,439.62

8 0
3 years ago
You own a fixed-income asset with a duration of five years. If the level of interest rates, which is currently 8%, goes down by
I am Lyosha [343]

Answer:

0.4629%

Explanation:

Given:

Duration of fixed assets (D) = 5 year

Interest rate (r) = 8% = 8/100 = 0.08

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Computation:

D* = D / (1 + r)

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D* = 5 / 1.08

D* = 4.6296

Computation:

ΔP/P = D* × ΔY

= 4.6296 × 0.01%

= 0.4629%

Therefore, Price of the assets go up to 0.4629%.

5 0
3 years ago
Desribe trend & supply. how do they affect eachother
Sophie [7]
First off you need to know what they mean. Trend means what people are in to and want to buy. Supply is how much the sellers have of items. If you have a huge supply of something that isn't in trend then you won't have any business. If you have a huge supply of something that is in trend, people will buy a lot of it. It is a factor of business like supply and demand. I hope this helped :)
6 0
3 years ago
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