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Reptile [31]
3 years ago
14

Ivanhoe company purchased machinery with a list price of $88000. They were given a 7% discount by the manufacturer. They paid $4

00 for shipping and sales tax of $4700. Ivanhoe estimates that the machinery will have a useful life of 10 years and a residual value of $25000. If Ivanhoe uses straight-line depreciation, annual depreciation will be
A) $6194
B) $5684
C) $8694
D) $6152
Business
1 answer:
cestrela7 [59]3 years ago
8 0

Answer:

A) $6194

Explanation:

Price before discount = $88,000

discount rate = 7%

Amount of discount = 7% *$88,000 = $6,160

Price after discount = Price before discount - Amount of discount

= $88,000 - $6,160

Price after discount = $81,840 (this is the price included in depreciation)

Items included in total cost of machinery;

Price of machinery after discount = $81,840

Shipping  cost = $400

Sales tax = $4,700

Therefore, total cost is therefore = $81,840 + $400 + $4,700 = $86,940

Depreciation per year = (Total cost of the machinery - salvage value) / useful life

= (86,940 - 25,000)/ 10

= 61,940/10

= 6,194

Therefore annual depreciation = $6,194

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3 years ago
Valet Corporation began operations in 2021. An analysis of Valet's debt securities portfolio acquired in 2021 shows the followin
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Answer:

$20,000

Explanation:

Calculation for What amount should Valet report in its 2021 income statement for unrealized holding loss

Using this formula

2021 income statement for unrealized holding loss=Aggregate cost -Aggregate Fair value

Let plug in the formula

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Therefore the amount that Valet should report in its 2021 income statement for unrealized holding loss is $20,000

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3 years ago
Generally accepted accounting principles (GAAP) requires the expenses incurred to generate revenues be matched in the same perio
spin [16.1K]

Answer:

The statement is: True.

Explanation:

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3 years ago
Vitale Hair Spray had sales of 27,000 units in March. A 60 percent increase is expected in April. The company will maintain 20 p
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Answer:

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The computation of the number of units the company should produced is shown below:

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3 years ago
Indicate the effect of each of the following transactions on total assets, total liabilities, and total stockholdersâ equity. Se
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Answer:

Transaction                       Assets            Liabilities        Stockholders' Equity

Issue common stock           Increase               NE                      Increase

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Sale of treasury stock         Increase              NE                        Increase  Declare cash dividend            NE                   Increase                   NE

Pay cash dividend               Decrease            Decrease NE

100% stock dividend              NE                        NE                      NE

2-for-1 stock split                    NE                       NE                         NE

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