When using the direct method for cash flows, one will notice that an increase in accounts receivable would result in a <u>DECREASE </u>in cash.
When an accounts receivable increases:
- It means that more debt has been incurred by debtors
- It means that less money entered into the company as people took goods but did not pay cash for them
Because the people did not pay cash for the goods yet took the goods, the company will see a reduction in its cash balance as the cash value of the goods left the company and there was no cash inflow from that activity.
In conclusion, an increase in accounts receivable leads to a decrease in cash.
<em>Find out more at brainly.com/question/25491863. </em>
Answer:
Advantage: Absence of Red Tape.
Advantage: Freedom to Innovate.
Advantage: Customers Drive Choices.
Disadvantage: Limited Product Ranges.
Disadvantage: Dangers of Profit Motive.
Disadvantage: Market Failures
Explanation:
hope it helped some :)
Since Margo purchase her optimal consumption bundle, the
marginal utility per dollar consumed on dance lessons must be equivalent to the
marginal utility per dollar paid on dance shoes. The marginal utility per
dollar spent on dance lessons is 100 utils per lesson, where $50 per lesson is equivalent
to 2 utils per dollar. The marginal utility per dollar expended on dance shoes
therefore has to equal 2 utils per dollar. Since the marginal utility of a pair
of dance shoes cost 300 utils per pair, the value of a pair of shoes should be
$150 per pair, so that 300 utils per pair/$150 per pair is equal to: 2 utils
per dollar.
Answer:
The long term capital gain= $30000-$25000
The long term capital gain= $5000
The basis in stock will be zero after the distribution.
Explanation:
Step 1 of 3
Tax treatment of amount distributed to shareholders:
The amount received as distribution to a shareholder under S Corporation is equal to the cash and fair market value of property distributed. The distribution is considered as tax-free to the limit that it does not exceed shareholder’s basis in the company’s stock. Any amount received in excess of basis will be treated as capital gain.
Step 2 of 3
However, taxation depends whether S Corporation has ever been a C Company or it posses’ accumulated earnings and profits. If it was never a C Corporation or doesn’t holds AEP then distribution equals to basis of share in S Corporation is a tax free gain for shareholder. Gain over and above basis is taxed as capital gains.
Step 3 of 3
In the given problem, C is a shareholder in S Corporation. He receives $30,000 as cash distribution. His basis in stock is $25,000. The distribution up to basis of stock is tax free distribution and above that is charged to capital gains. It is as follows-
Thus, capital gain of is taxable in hands of C. His basis in S Corporation will reduced to zero as entire distribution is over and above basis of his stock.
A letter provided by the tenant to the landlord, which assures that their lease is binding, accurate, and being paid upon, is known as an estoppel letter.
Letters have long been an essential supply of biographical information, and an effective device for historians of all kinds. They permit the reader to peek backstage and might offer a feel of intimate expertise of historic subjects, even supposing this intimacy is borrowed or stolen.
Informal letters are non-public letters that might be written to allow your buddies or own circle of relatives to realize approximately what goes on in your lifestyle and to bring your regards. A casual letter is typically written to an own circle of relatives member, a near acquaintance, or a friend. The language utilized in a casual letter is informal and non-public.
A letter is stated to be casual while it's far written in a pleasant way, to a person you're acquainted with. Formal letters are written for reputable or expert communication. On the opposite hand, casual letters are used for informal or non-public communication. There is a way prescribed for writing formal letters.
Learn more about the letter here brainly.com/question/9425444
#SPJ4
