All categories

3 years ago

Mr. Decker invested $20,000 in cash in his business. How does the company record the investment?

Business

1 answer:

Dvinal [7]3 years ago

4 0

Answer:

The company records the investment by the entry:

debit Cash and credit Owner's Equity

Explanation:

Mr. Decker invested $20,000 in cash in his new business. He is the Owner of the company.

In the case, the company that he invested received cash from Mr. Decker.

The company will record the increasing in cash and increasing in Owner's Equity account by the journal entry:

Debit Cash $20,000

Credit Owner's Equity $20,000

You might be interested in

Compute the Cost of Goods Sold for 2016 using the following information:Direct Materials, Jan. 1, 2016 $40,000Work-in-Process, D

guapka [62]

Answer:

Cost of Goods Sold = $234,000

Option B is correct ($234,000)

Explanation:

First we will calculate total direct material used in production:

Total Direct material=Starting Direct Material+ Purchases of Direct Material+ Ending Direct material

Total Direct material=$40,000+$75,000-$43,000

Total Direct material=$72,000

Calculating Cost of goods Manufactured:

Cost of goods Manufactured=Total Direct material+Direct labor+ Manufacturing Overhead+Beginning WIP inventory-Ending WIP inventory

Cost of goods Manufactured=$72,000+$48,500+$72,500+$87,000-$69,000

Cost of goods Manufactured=$211,000

Cost of Goods Sold = Cost of goods Manufactured+ Starting Finished Goods-Ending Finished Goods

Cost of Goods Sold = $211,000+$128,000-$105,000

Cost of Goods Sold = $234,000

Option B is correct ($234,000)

6 0

3 years ago

The break-even point is that level of activity where:

ycow [4]

Dddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddd

3 0

3 years ago

Firm A has earnings-per-share of $3.00. Firm B has earnings-per-share of $2 and a price-per-share of $30. Using the Price/Earnin

stealth61 [152]

Answer:

Company A's price per share is $45

Explanation:

The P/E ratio of one company can be used by investors and analysts to determine the value of another companie's stock in the industry. This is called apples-to-apples comparism.

The P/E ratio is used to value a company by comparing its share price to earnings per share.

P/E ratio= market value of shares/ earnings per share

For company B

P/E ratio= 30/2= $15

Using company B's P/E ratio as a benchmark for company A

15= Price per share /3

Price per share = 15*3= $45

8 0

3 years ago

On July 1 the Fisher Shoe Store paid $24,000 to Acme Realty for 6 months rent beginning July 1. Prepaid Rent was increased for t

Papessa [141]

Answer:

Increase Rent Expense, $4,000; decrease Prepaid Rent, $4,000.

Explanation:

Since Fisher Shoe Store paid $24,000 to Acme Realty for 6 months rent beginning July 1, we will calculate monthly rent amount by:

24,000/6 = $4,000

Financial statements are prepared on July 31, so we will adjust the July rent in the adjusting entry.

We will debit the rent expense by $4,000 and credit the prepaid rent which is an asset to decrease it by an amount of $4,000.

4 0

3 years ago

On October 1, 2015, Zircon Jewelry Company accepted a 4-month, 10% note for $2,400 in settlement of an overdue account receivabl

Whitepunk [10]

Answer:

Explanation:

The journal entry is shown below:

Cash A/c Dr $2,480

To Interest receivable $60

To Interest revenue $20

To Note receivable $2,400

(Being the collection of funds is recorded)

The computation of interest receivable is shown below:

= Principal × rate of interest × number of months ÷ (total number of months in a year)

= $2,400 × 10% × (3 months ÷ 12 months)

= $60

And for interest revenue would be

= Principal × rate of interest × number of months ÷ (total number of months in a year)

= $2,400 × 10% × (1 months ÷ 12 months)

= $20

7 0

3 years ago