1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Paladinen [302]
2 years ago
8

Karen, an accrual basis taxpayer, sold goods in December 2019 for $20,000. The customer was unable to pay cash. So the customer

gave Karen a note for $20,000 that was payable in April 2020. The note bore interest at the Federal rate. The fair market value of the note at the end of 2019 was $18,000. Karen collected $20,500 from the customer in April 2020, $20,000 principal plus $500 interest. Under the accrual method, Karen must recognize income of:
Business
1 answer:
Step2247 [10]2 years ago
3 0

Answer:

Karen must recognize income of $20,000 in 2019 and $500 in 2020

Explanation:

Accrual basis of accounting states that income must be recognized in the period when it is earned and expenses must also be recognized when it is incurred.

Therefore, since the goods was sold in December 2019 and $500 interest was paid with the principal in April 2020, Karen must recognize income of $20,000 in 2019 and $500 in 2020.

You might be interested in
By definition, empirical probability is equal to:
lidiya [134]

By definition, empirical probability is equal to C. Number of successful trials/Total number of trials.

<h3>What is an empirical probability?</h3>

It should be noted that empirical probability simply means a experimental probability that is based on historical data.

In this case, by definition, empirical probability is equal to the number of successful trials divided by the total number of trials.

Learn more about empirical probability on:

brainly.com/question/16972278

#SPJ1

7 0
2 years ago
Is the cost of equity calculated from the CAPM model, pre -tax or post-tax?
Natasha_Volkova [10]
The existence of pre-tax cost of debt and post-tax cost of debt is due to the acknoledgement of the tax benefit from issuing debt.There is no tax benefit from paying divdends,so it makes no sense talking about pre-tax,post-tax cost of equity for a firm.When you think about cash flow to equity you can only assume that the taxes owed by the company have already been paid.Now, the taxation over the income of the shareholder is a whole different issue that does not take place in this discussion,since it is not taken in consideration either in cost of equity or cost of debt.
3 0
3 years ago
On January 2, 2019, Adelphi Company purchased a patent for $235,000 plus
Ymorist [56]

Answer:

The annual amortization expense for 2019 will be $35000.

Explanation:

The amortization expense for the patent calculated based on the useful life of patent. The purchase of value of $235000 plus $10000 gives the total value of $245000 while use the patent of 7 years.

The formula for amortization expense = (Cost of patent - Residual value ) / Useful life of patent)

amortization expense = ($245000-0)/7 = $35000

The legal life would not count due patent in business use for limited life compare to legal life of patent.

4 0
3 years ago
Variance reports are: internal reports for management external financial reports SEC financial reports all of these
alina1380 [7]
Variance reports are internal reports for management. They are used primarily for the purposes of internal accounting and auditing. 
8 0
3 years ago
Ithaca is considering a new $45,000 snowplow that will save the city $400 per day of use compared to the existing one. It should
Yuliya22 [10]

Answer:

a/ 20 days per year on average

b/ The use of road salt to is an effective deicer method. However, it will eventually causes some harmful impact on the environment including but not limited to increasing in water/soild salinity, contamination of public drinking waters, destroy the soild structure and slowly killing of trees and plants. Luckily, there are some other options which are more environment-friendly such as Cheese brine, Sand, Urea, Beet molasses

Explanation:

a/ To evaluate the investment of the new snowplow, denote X is the average amount of saving per a year as the new snowplow is used.

    Consider the average amount of saving as an annuity for the next 12 years, with the discount rate of 14%. The present value (PV) = 45,000 - 2,500/1.14^(-12) =$44,481.1

   Thus, to obtain the rate of return of 14%, PV of the annuity should be equals to $44,481.1 meaning: 44,481.1= (X/14%) x [ 1 - 1.14^(-12)] <=> X = $7858.44

   As one day use would save Ithaca $400, to achieve the targeted saving of $7858.44, the city has to use the snowplow at least 20 days per year ( 7858.44/400)

5 0
3 years ago
Other questions:
  • With respect to advertising, _____ opinion leadership can involve presenting the results of surveys showing that a high percenta
    7·1 answer
  • You go to a local car lot and buy a used car as is. After you have driven only a few miles, the check-engine light flashes urgen
    14·1 answer
  • On January 1, year 1, London Corp. purchases equipment for $400,000. The equipment has a 5-year service life and a $50,000 resid
    8·1 answer
  • The Production Department of Hruska Corporation has submitted the following forecast of units to be produced by quarter for the
    13·1 answer
  • Which of the following is NOT considered a convertible instrument and is indicative of a complex capital structure? a. convertib
    13·1 answer
  • In the books of seller, ____ is deducted from the invoice price when the buyer pays earlier or on the date/term stipulated
    7·1 answer
  • Suppose the demand for roses increases from 500 to 600 stems when income rises from $10,000 to $20,000. Income elasticity for ro
    14·1 answer
  • I need this really fast pleaseeee
    15·1 answer
  • On December 31 of the current year, the unadjusted trial balance of a company using the percent of receivables method to estimat
    10·1 answer
  • Kristy's health insurance policy benefits max out at $25,000 per year. What is
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!