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ycow [4]
2 years ago
10

Which of the following statements regarding a tax sheltered annuity (tsa) is incorrect? the income from the tsa is received inco

me tax-free the amount contributed is deductible from taxable income the interest earnings are tax deferred a tax-sheltered annuity is available to employees of non-profit organizations?
Business
1 answer:
Fudgin [204]2 years ago
5 0

The incorrect statement is : The income from the TSA is received income tax-free. Upon retirement, payments received by employees from the accumulated savings in tax-sheltered annuities are treated as ordinary income.

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Galvatron Metals has a bond outstanding with a coupon rate of 6.1 percent and semiannual payments. The bond currently sells for
Eva8 [605]

Answer:

After tax cost of debt is 4.16%

Explanation:

The yield on the debt which is pre-tax cost of debt can be computed using the rate formula in excel, which is given as follows:

=rate(nper,pmt,-pv,fv)

where nper is the number of coupon payments,this is calculated as 19*2 since it has a semi-annual coupon interest

pmt is the periodic coupon payment  6.1%/2*$2000=$61

pv is the current price of the bond which is $1933

fv is the face value repayable on redemption $2000

=rate(38,61,-1933,2000)

=3.20%

This is semi-annual yield , annual yield is 3.20%*2=6.40%

After tax cost of debt=6.40%*(1-t)

where t is the tax rate at 35%=0.35

after tax cost of debt=6.40%*(1-0.35)

                                  =4.16%

5 0
3 years ago
The University of Dental Health (UDH) is a state-run university focusing on the education and training of dentists, dental assis
velikii [3]

Answer:

The University of Dental Health (UDH)

Functions                                           Type of Center

Accounting                                         Cost Center

Bookstore                                           Profit Center

Cafeterias                                           Profit Center

Career services                                  Cost Center

Community workshops                      Profit Center

(providing

continuing professional

education necessary for

state licensure)

Custodial services                              Cost Center

Financial aid                                        Cost Center

Human resources                              Cost Center

Information technology                     Cost Center

Residence halls                                  Profit Center

Student parking lots (fee based)      Profit Center

University newspaper/radio station Cost Center

Explanation:

The UDH's cost center is a department or function that does not directly contribute to its profitability but costs it money to operate its activities. A profit center, on the other hand, directly contributes to the University's profitability by generating revenue through its activities.  Please, note that the dividing line is thin.  The determinant factor depends on the choices and efforts made by an organization's management to commercialize some of its internal services.

3 0
3 years ago
Differential Analysis for Machine Replacement Boyer Digital Components Company assembles circuit boards by using a manually oper
jasenka [17]

Answer:

Continue with old machine

Explanation:

                                   Differential Analysis

Continue with Old Machine (Alt.1)or Replace Old Machine (Alt.2

                                             May-04

                    Continue with Old     Replace Old           Diff. effects                                        Machine (Alt. 1)      Machine (Alt.2)             (Alt. 2)  

Revenues:    

Sale ( 5 years)   803,500             803,500                       0

Costs:    

Purchase price 0                       -105,500                  105,500

Direct materials  -274,000         -274,000                      0

( 5 years)

Direct labor        -190,000                0                       -190,000

( 5 years)

Power and          -17,500               -94,000               76,500

maintenance

Taxes, insurance  -6,500              -21,000                14,500

etc ( 5 years)

Selling and          -190,000             -190,000                0

administrative

expense ( 5 years)

Total expenses    -678,000            -684,500             6,500

Profit (Loss)          $125,500              $119,000           $6,500

Hence it is advantageous to continue with old machine. Net incremental advantage of continuing with old machine = $6,500

6 0
3 years ago
A depreciable asset was purchased for $8,000. The estimated useful life of the asset is 5 years. The estimated salvage value is
zhuklara [117]

Answer:

The estimated amount of depreciation expense is $1,500

Explanation:

Depreciation means a permanently and continuous diminution in value or quaof a tangible non-current asset. Depreciation occurs over several years. Every year a non-current asset is used, the price of that asset reduces drastically. There are various methods used to solve the rate of depreciation. There is the straight line method and reducing balance method. The question requires to be solved using the straight line method.

The formula for solving depreciation using a straight line method is ; (Cost less Estimated scrap value) ÷ Number of expected years of use.

Replacing with figures, we have: ($8,000 - $500) ÷ 5 years = $1,500. Therefore, $1,500 is our estimated amount of depreciation expense.

5 0
3 years ago
Read 2 more answers
________ is a trade pact among Costa Rica, El Salvador, Guatemala, Honduras, and Nicaragua, which began in the early 1960s but c
jolli1 [7]

Answer: Central American Common Market ( CACM) or in Spanish Mercado Comun Centroamericano (MCCA)

Explanation: The Central American Common Market was established in December 1960 comprising of Guatemala, Honduras, El Salvador and Nicaragua and later joined by Costa Rica in July 1962 was established by the general Treaty on Central American Intergretaion with its headquaters based in Guatemala city to foster free trade and economic integration by member states.

It's was established or formed as a need for member countries to respond and cooperate with each other thereby attracting industrial capital and also diversifying their economies to promote regional trade among all member states.

8 0
3 years ago
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