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fgiga [73]
3 years ago
7

Allison engines corporation has established a target capital structure of 40 percent debt and 60 percent common equity. the firm

expects to earn $150,000 in after-tax income during the coming year, and it will retain 40 percent of those earnings. what is the break point of retained earnings?
Business
1 answer:
mariarad [96]3 years ago
6 0

Answer: $100,000

Explanation: Allison engines corporation has a profit of $150,000 after Tax.

Rate of retained earning : 40%

Retained earnings : $150,000 × 40% = $60,000

Percentage of equity in the capital is 60%

Break even point of retained earnings = Retained Earnings ÷ Percentage of equity in the capital

Break even point of retained earnings = $60,000 ÷ 0.6

Break even point of retained earnings = $100,000

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An Office Manager uses a Periodic Review Inventory System: they check the inventory in the Office Supply Closet once every 10 da
adoni [48]

Answer:

880 blue ink pens

Explanation:

The computation of the inventory position is shown below:

= Current stock counted in the closet + already placed orders with the supplier

where,

Current stock counted in the closet is 220 blue ink pens

And, the  already placed orders with the supplier is 600 blue ink pens

Now placing these values to the above formula

So, the inventory position is

= 220 blue ink pens + 600 blue ink pens

= 880 blue ink pens

8 0
3 years ago
Death benefit proceeds from a life insurance policy are included in a decedent's gross estate in which of the following circumst
Katarina [22]

Answer:

B. 1 and 2.

Explanation:

Life insurance policy can be defined as a contract between a policyholder and an insurer, in which the insurer agrees to pay an amount of money to a specific beneficiary either upon the death of the insured person (decedent) or after a set period of time.

A decedent refers to a deceased person who is no longer able to control his or her properties (wealth).

Generally, insurance companies across the globe charge millions of their customers (insured) premiums every year. This gives them the privilege of having a pool of cash which can be used to cover the cost of losses and destruction to the asset of a small fraction or percentage of its customers.

This simply means that, since insurance companies collect premium from all of their customers for losses which may or may not occur, so they can easily use this cash to compensate or indemnify for losses incurred by those having high risk.

Death benefit proceeds from a life insurance policy are included in a decedent's gross estate in the following circumstances:

I. The decedent gave the policy to his father four years ago, but retained the right to change the name of the beneficiary.

II. The policy beneficiary is a grantor trust of the decedent but the policy is owned by a closely-held corporation.

8 0
3 years ago
Graham Corp. has 1,000 cartons of oranges that were harvested at a cost of $30,400. The oranges can be sold as is for $36,400. T
Readme [11.4K]

Answer:

c. $3,600

Explanation:

The total cost of orange juice = $30,400 + $13,000

The total cost of orange juice = $43,400

So, the profit on the orange juice = $53,000 - $43,400 = $9,600

Profit when oranges are sold without juice = $36,400 - $30,400

Profit when oranges are sold without juice =  $6,000

So, extra income = $$9,600 - $6,000 = $3,600

Thus, the net benefit (additional income) from processing the oranges into orange juice instead of selling as is would be is $3,600

5 0
2 years ago
For a business that uses the allowance method of accounting for uncollectible receivables:
Yuri [45]

Answer:

The Journal entries to record the given transactions would be:

Account Title                                                  Debit         Credit

(1) Uncollectible Accounts Expense              18,600

    Allowance for Doubtful Accounts                               18,600

     ($600 + $18,000)

(2) Allowance for Doubtful Accounts              350

    Accounts Receivable—Fronk Co.                                350

(3)  Accounts Receivable—Fronk Co.             200

     Allowance for Doubtful Accounts                               200

     Cash                                                            200

     Accounts Receivable—Fronk Co.                                200

(4)  Cash                                                            400

     Allowance for Doubtful Accounts*            200

     Accounts Receivable—Dodger Co.                             600

($600 - $400)*

3 0
3 years ago
In what sort of pricing strategy does the team apply different price scales based on factors such as opponent, event, time of se
Len [333]

Answer:

variable pricing

Explanation:

A variable pricing strategy refers to selling a same product or service at a different price depending on the sales location, date, or other factors. This type of strategy is used to try to maximize revenue by adjusting price to the different categories of our points of sale or our customers.

In case of sports teams, they will price their seats based on other factors like who is the opponent (current champion v. bad teams), day of the week (weekends v. weekdays) or the time of the season (middle of the season v. near playoffs), etc.

7 0
3 years ago
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