All categories

2 years ago

Closed the credit balance of $188,000 (from net income) in the retained earnings income summary account.

1 answer:

3 0

Assuming that you wanted to know how to journal this, it would be :

Dec. 31

Debit Credit
Income Summary $ 188,000
Retained Earning $ 188,000

You might be interested in

You just won the lottery and have two choices for how you will collect your money. You can collect $100,000 today or receive $20

patriot [66]

Answer:

Please see attachment

Explanation:

Please see attachment

7 0

2 years ago

In 2019, Carla Enterprises issued, at par, 60 $1,000, 8% bonds, each convertible into 100 shares of common stock. Carla had reve

dimulka [17.4K]

Answer:

Diluted earnings per share for 2020. is 93 cents

Explanation:

Diluted Earnings per share shows the future position of the Earnings per shareholders once the potential shareholders begin exercising their rights.

Potential Shareholders exists due to Financial Instruments that might be converted into ordinary shares. Examples are Convertible Bonds, Options, Convertible Preference shares.

Step 1 Calculate Basic Earnings Per Share

Basic Earnings Per Share = Earnings Attributable to Ordinary Shareholders / Weighted Average Number of Ordinary Shares in Issue during the period.

Profits attributable to Ordinary Shareholders :

Earnings ( $14,700 - $6,900) $7,800

Less After tax Interest on Bonds (60×$1,000×8%×80%) ( $3,840)

Profits attributable to Ordinary Shareholders $ 3960

Weighted Average Number of Ordinary Shares

Common stock outstanding 2,400 shares

Basic Earnings Per Share = $ 3960/ 2,400

= 165 cents

Step 2 Calculate Diluted Earnings Per Share

Diluted Earnings Per Share = Adjasted Basic Earnings per Share Earnings/ Adjasted Number of Ordinary Shares

Adjusted Basic Earnings per Share Earnings

Profits attributable to Ordinary Shareholders $ 3960

Add Savings on Interest (60×$1,000×8%×80%) $3,840

Adjusted Basic Earnings per Share Earnings $7,800

Adjusted Number of Ordinary Shares

Common stock outstanding 2,400 shares

Add 60× 100 shares of Convertible Bonds 6,000 shares

Adjusted Number of Ordinary Shares 8,400 shares

Diluted Earnings Per Share = $7,800/8,400 shares

= 93 cents

7 0

3 years ago

If person A and B are well informed and intelligent player, A have available choices :

AfilCa [17]

Idisksjsisisiisisososk sjsjskdjdjjsjssjbsjsjsjs sjsu’s

5 0

3 years ago

If it proves possible to make abnormal profits based on information regarding past stock prices, then the market:___________

Alla [95]

Answer:

a. is weak-form efficient

Explanation:

A weak-form efficient market postulates that the present price of a stock reflects previous all data from past prices.

It suggests that no technical analysis can be of help to the investor.

This implies that fundamental analysis using historical prices and data of a stock can be used to predict stocks that are overpriced or underpriced.

So researching a company's financial statements gives an edge on predicting today's stock price.

Investors can make abnormal profit

4 0

3 years ago

Shen lives in Dallas and runs a business that sells pianos. In an average year, he receives $851,000 from selling pianos. Of thi

Elis [28]

Solution :

The income from renting his showroom that Paolo would receive if he allowed to rent his showroom is a Implicit cost as this is a cost which will not be paid in actual.

The wages as well as the utility bills paid by Paolo is an example of explicit cost as this cost would be paid in actual for the businesses and are added in accounting.

The wholesale amount that Paolo pays for the pianos to the manufacturer is an explicit cost and is aid in actual to the manufacturer.

The salary that Paolo could have earned if he choses to be an accountant will be an implicit cost as this cost is not paid in actual.

2. Paolo's accounting profit can be calculated by :

Accounting profit = revenue - explicit cost

= 851,000 - 476,000 - 281,000

= $ 94,000

3. Paolo's economic profit is :

Economic profit = accounting profit - implicit profit

= 94,000 - 34,000 - 71,000

= -11,000

6 0

2 years ago