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Romashka [77]
3 years ago
9

Stanton Inc. is considering the purchase of a new machine that will reduce manufacturing costs by $5,000 annually and increase e

arnings before depreciation and taxes by $6,000 annually. Stanton will use the Modified Accelerated Cost Recovery System (MACRS) method to depreciate the machine, and it has estimated the depreciation expense for the first year as $8,000. Which of the following is the supplemental operating cash flow for the first year if Stanton's marginal tax rate is 40 percent?
Business
1 answer:
Greeley [361]3 years ago
7 0

Answer:

$9,800

Explanation:

supplemental cash flow for year 1 = [(decrease in costs + increase in earnings - depreciation) x (1 - tax rate)] + depreciation expense = [($5,000 + $6,000 - $8,000) x (1 - 40%)] + $8,000 = ($3,000 x 0.6) + $8,000 = $1,800 + $8,000 = $9,800

Since depreciation expense does not generate a cash outflow it must be included when you calculate taxes, but then you must add it later.

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Confirmations that are sent to select customers asking them to review the current balance due the client as shown on the client'
nata0808 [166]

Answer:

The correct answer is letter "C": Positive confirmations.

Explanation:

Positive confirmations are audit procedures by which ambiguous information is clarified. It also implies the confirmation of the accuracy of the data provided in the company's books and Financial Statements. By doing so, liabilities, bank accounts, accounts receivables and payables amounts are verified.

4 0
3 years ago
The 2016 financial statements of CVS Health Corporation reported the following information (in millions): 2016 2015 Net sales $1
Serggg [28]

Answer:

option (D) 10.34

Explanation:

The  inventory turnover ratio for 2016 will be given as:

= [Cost of goods sold ] ÷ Average inventory

also,

Cost of goods sold in 2016 = $148,669

Average inventory = [ 2015 inventory + 2016 inventory ] ÷ 2

= [ 14,001 + 14,760 ] ÷ 2

= 28761 ÷ 2

= 14,380.5

Therefore,

The  inventory turnover ratio for 2016 = $148,669 ÷ 14,380.5

= 10.34

Hence,

The answer is option (D) 10.34

8 0
3 years ago
Maria is flagged as a special customer at your firm because she is a satisfied customer, returns to your company to buy, puts he
KIM [24]

Answer:   Advocate

                     

Explanation: In simple words, advocate level is the topmost stage in the loyalty ladder. In this stage, the customer gets used to for the brand and along with repurchasing it he or she also works as a promotional toll for the brand.

In the given case, Maria has been repurchasing the products from the firm and is also praising the brand online. Hence we can conclude that she is on the advocate rung.

4 0
3 years ago
A company finds that there is a linear relationship between the amount of money that it spends on advertising and the number of
ser-zykov [4K]

Answer:

y = (x / 100) + 100

Explanation:

First, we need to know the amount of money that it spends on advertising for each extra unit sold. That would be equal to: 2,500 / 25 = 100

This value will be the divisor of the advertising expense (x) to obtain the variable factor of the number of units.

Since 100 units are already sold without investment, this value is taken as fixed and added.

And with the previous data, the formula remains:

y = (x / 100) + 100

4 0
3 years ago
The _____________ define(s) what the system does.
labwork [276]
1.A.The mission of the System
2.C.Losses
3.B.Operational Characteristics
6 0
3 years ago
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