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Natasha2012 [34]
3 years ago
11

Geo Co. purchased a building for $400,000. In addition, Geo paid $35,000 closing fees (including title and lawyer fees). Geo als

o paid $60,000 to modify the building, changing the layout specifically for Geo's needs. Geo should record the building at:_________.
Business
1 answer:
Vedmedyk [2.9K]3 years ago
8 0

Answer: $495,000

Explanation:

ALL costs that went into the DIRECT acquisition of the asset as well as COSTS TO SET IT UP for use by the firm should be accounted for in the amount recorded.

In this case that would mean that the cost price, the closing fees and the modification fees all need to be accounted in the final amount.

That would be

$400,000 + $35,000 + $60,000

= $495,000

$495,000 should be recorded as the building's cost.

You might be interested in
The diagnostic process is _____. a systematic approach to understand the organization none of the answers performed exclusively
Nutka1998 [239]

Answer:

A. a systematic approach to understand the organization

Explanation:

Business diagnosis can be defined as a strategic technique which typically involves the process of defining, identifying and classifying the various business processes, logistics, product quality in order to have an indepth understanding and knowledge about an organization.

The diagnostic process is a systematic approach to understand the organization because it involves critically studying all its aspects and areas.

Hence, the information gathered through the diagnostic process can be used by the management to facilitate its decision-making process and its competitive advantage.

3 0
2 years ago
Jose goes to an all-you-can-eat buffet at a Chinese restaurant and consumes three plates of food. He does not go back for a four
kkurt [141]

Answer:

The marginal utility of the fourth plate is zero or below zero

Explanation:

The reason is that the law of diminishing marginal utility says that the marginal utility of a product declines upon continuous consumption of that item. This means that the utility before the consumption of first buffet was high and when the second buffet was consumed by the same person the utility was further reduced and so on. This means that the utility must be positive which if is higher enough then the customer is will to pay and eat the buffet again. If it is zero or below zero the customer is not willing to pay for the buffet. This is the reason the person doesn't ordered the item again.

You can not eat the same buffet for all the 365 days. This means the taste of a tasty food fades away after some time or I would say that the utility is gone. Same is the case when you will keep using cellphone for a period and then sell it or dispose it because the item doesn't entertains you or in other words the utility has significantly fallen and is almost zero or below zero.

5 0
3 years ago
How long does it take to become a​ millionaire? A ​$500,000 investment will hit​ $1 million in 39 years at an annual interest ra
Solnce55 [7]

Answer:

It will take 30.10 year

Explanation:

We have given initial investment $500000

Future value = $ 1 million = $1000000

Rate of interest r = 1.79 %

We have to find the time taken to reach the amount $1000000

We know that future value is equal to A=P(!+\frac{r}{100})^n

1000000=500000(!+\frac{1.79}{100})^n

2=(1.0179)^n

Taking log both side

log2=nlog1.0179

n×0.0077 = 0.3010

n = 39.09 year

Now in second case rate of interest

r = 2.34 %

So 1000000=500000(1+\frac{2.34}{100})^n

2=(1+\frac{2.34}{100})^n

2=1.0234^n

taking log both side

log 2 = n log 1.0234

n×0.01 = 0.3010

n = 30.10 year

8 0
3 years ago
Spartan Corporation, a U.S. corporation, reported $2 million of pretax income from its business operations in Spartania, which w
pashok25 [27]

Answer:

A. = (15% X $2M) + (21% X $2M) = $720,000. Since there is no mechanism for mitigating double taxation, the branch profit will be taxed on the to tax rate of 15% and 21% which is $300,000 and $420,000.

B. The total tax for $2m branch profit if US corporations can remove foreign based profit from US taxation will be just the 15% x $2m = $300,000.

C.If they are allowed to take deductions for foreign income taxes, the total tax on the $2m branch profit will be (21% -15%) x $2m = $120,000.

Explanation:

D.1. If credit are allowed for foreign income tax paid, total tax will be ($2m - $300,000 been foreign tax paid) x 21% = $357,000

D.2.

If the charge foreign income taxes at 30% and US corporations can claim refundable credit for foreign income tax paid on foreign source income = ($2m - $300,000 been the foreign income tax paid) = $1 700,000 x 30% = $510,000

8 0
3 years ago
Based on current dividend yields and expected capital gains, the expected rates of return on portfolios A and B are 12% and 16%,
monitta

Answer:

Alpha for A is 1.40%; Alpha for B is -0.2%.

Explanation:

First, we use the CAPM to calculate the required returns of the two portfolios A and B given the risks of the two portfolios( beta), the risk-free return rate ( T-bill rate) and the Market return rate (S&P 500) are given.

Required Return for A: Risk-free return rate + Beta for A x ( Market return rate - Risk-free return rate) = 5% + 0.7 x (13% - 5%) = 10.6%;

Required Return for A: Risk-free return rate + Beta for B x ( Market return rate - Risk-free return rate) = 5% + 1.4 x (13% - 5%) = 16.2%;

Second, we compute the alphas for the two portfolios:

Portfolio A: Expected return of A - Required return of A = 12% - 10.6% = 1.4%;

Portfolio B: Expected return of B - Required return of B = 16% - 16.2% = -0.2%.

8 0
2 years ago
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