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exis [7]
3 years ago
10

Cary is experiencing cash flow problems during the current year. Rather than foreclose an $80,000 business loan, his bank agrees

to reduce the debt to $50,000. Prior to the debt reduction, Cary's total assets were $500,000 and his total liabilities were $510,000. How much income must Cary recognize from the reduction of his bank loan? a. - 0 - b. $10,000 c. $20,000 d. $30,000
Business
2 answers:
Nata [24]3 years ago
6 0

Answer:d. $30,000

Explanation:

The reduction of loan amount from $80,000 to $50,000 means carry has gained the difference of $30,000 by paying less than the value of loan he has received.

On an overall analysis the net asset will improve from -$10,000 to $20,000 but the income from the loan reduction is $30,000 i.e,$80,000 minus $50,000.

devlian [24]3 years ago
5 0

Answer:

Reduction in debt = Existing Loan - Reduced loan

                              = $80,000 - $50,000

                              = $30,000

The income to recognize from the reduction in loan = $30,000

Explanation:

The $30,000 reduction in loan is a saving to the company. Thus, it should be recognized as an income by Cary. Reduction in liability is an inflow to the company.

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Shelley compared the number of oak trees to the number of maple trees as part of a study about hardwood trees and a woodlot she
Masja [62]

There were 72 (108 - 36) more maple trees in the woodlot before the bug problem. There were 108 maple trees in the woodlot before the bug problem. There are 36 maple trees in the woodlot after the bug problem.

The following information is given in the question:

Ratio of maple trees to oak trees before bug problem = 9:5

Ratio of maple trees to oak trees after replanting = 3:11

Total number of oak trees after replanting =132

Total number of trees in the woodlot is the same before and after the bug problem.

Let the number of maple trees after replanting be 'x'

From the data above, we can find the number of maple trees after replanting as follows:

\frac{3}{11} = \frac{x}{132}

\frac{(3*132)}{11} = {x}

x = 36

So, number of maple trees after replanting in the woodlot are 36.

Total number of trees in the woodlot =   No. of maple trees + No. of oak trees.

Total number of trees in the woodlot =  168 (132 + 36)

Let number of maple trees before bug problem be 'z'.

We can find the number of maple trees before bug problem as follows:

\frac{9}{(9+5)} = \frac{z}{168}

\frac{9*168}{14} = z

z = 108

6 0
3 years ago
unland Company has the following data: direct labor $238,000, direct materials used $199,000, total manufacturing overhead $248,
labwork [276]

Answer:

(a) Total manufacturing costs = $685,000

(b) Total cost of work in process = $721,000

Explanation:

(a) Compute total manufacturing costs.

Total manufacturing cost can be described as the total cost that a manufacturing company incurred within a reporting period to produce goods.  This can be computed using the information provided in the question as follows:

Total manufacturing cost = Direct materials used + Direct Labor + Total manufacturing overhead = $199,000 + $238,000 + $248,000 = $685,000

(b) Compute total cost of work in process.

Total cost of work in process refers to the aggregate cost of partially completed goods. This can be computed using the information provided in the question as follows:

Total cost of work in process = Beginning work in process + Total manufacturing costs = $36,000 + $685,000 = $721,000

7 0
3 years ago
Assume that the Charleston Inc. uses the indirect method to depict cash flows. Indicate where, if at all, an inventory increase
Airida [17]

Answer:

Operating activities section

Explanation:

In the indirect method of cash flow statements, current assets and current liabilities are adjusted with net income and non-cash items. It means changes in net working capital (Current assets - Current liabilities) fit with the net income in the operating cash flow section. Therefore, any decrease or increase is stated under the operating cash flow segment. Inventory increase will deduct from the net income because we spend more cash to acquire inventory.

7 0
4 years ago
1) Show the effect of the following transactions on the Accounting Equation:
Dennis_Churaev [7]

Answer:

Assets=48,000

Liabilities=47,700

Capital=300

More explanations is as attached.

Explanation:

The accounting equation can be expressed as shown;

A=L+C

where;

A=assets

L=liabilities

C=capital

This is then written as;

Assets=liabilities+capital

More explanations is as attached.

Download xlsx
6 0
3 years ago
The unadjusted balance of the company's Cash account was $26,620 at the end of June. The bank statement shows a balance on June
tatyana61 [14]

Answer:

Adjusted bank and book balance is $25,960 and $25,960 respectively

Explanation:

                                 Bank statement balance       Book balance

Opening balance            26,960                                  26,620

Add:                          <em>Deposit in transit                    Interest earned    </em>

                                         3,000                                  150

Less:                  <em>Outstanding check</em>                           <em>Error on check </em>

                                        4,000                      (4,900 -4,090) = 810

Adjusted Balance         $25,960                                   $25,960

8 0
3 years ago
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