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LUCKY_DIMON [66]
3 years ago
12

Hunter Sailing Company exchanged an old sailboat for a new one. The old sailboat had a cost of $110,000 and accumulated deprecia

tion of $22,000. The new sailboat had an invoice price of $124,000. Hunter received a trade-in allowance of $96,000 on the old sailboat, which meant the company paid $28,000 in addition to the old sailboat to acquire the new sailboat.
If this transaction lacks commercial substance, what amount of gain or loss should be recorded on this exchange?


a. $8,000 loss


b. $8,000 gain


c. $88,000 loss


d. $0 gain or loss


e. $96,000 gain
Business
1 answer:
Mekhanik [1.2K]3 years ago
3 0

Answer:

The amount of gain or loss should be recorded on this exchange: b. $8,000 gain

Explanation:

Book value of the old sailboat = old sailboat's cost - accumulated depreciation = $110,000-$22,000 = $88,000

Trade-in allowance of  the old sailboat - Book value of the old sailboat = $96,000 - $88,000 = $8,000 >0

Hunter Sailing Company only paid $28,000 in addition to the old sailboat to acquire the new sailboat.

Therefore, the company should record gain on this exchange of $8,000

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larisa86 [58]

Answer:

Unfreezing

Explanation:

There are three phases of organizational change. Sun Technologies can be said to be at its unfreezing stage.

The organization must properly communicate with its employees and consumers at each level of changes they are.

  • At the unfreezing stage, the goal is to change the mindset and belief of the consumers about a particular process being deployed.
  • Since the adoption of the new technology is being advertised as one that will make things better, we can see elements of unfreezing here.
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8 0
3 years ago
How much do you need invested to live off dividends.
Alexxx [7]

Answer:

Usually right between 100,000 and 600,000.

5 0
2 years ago
Assume that Firm ABC has revenues of $120,000 for both 2017 and 2018. It also has operating expenses of $40,000 for each of thes
ivolga24 [154]

Answer:

1) deferred tax asset = 4000

2) deffered tax Liability  = 4000

Explanation:

1) Journalizing entry at 12/31/2017

deferred tax asset = tax ( per income tax) - tax ( per book tax )

                              = 32000 - 28000 = 4000

 J<u>ournal Entry made for Income tax and deferred tax asset) </u>

       Account                           Debit Credit

Income Tax Expense                28000  

Deffered Tax Asset                4000  

Income Tax Payable                                     32000

2) Journalizing entry at 12/31/2018

Deffered tax Liability = Tax (per book)  - Tax ( Income tax  )

deffered tax Liability = 32000 - 28000  = 4000

    <u>Journal Entry made for Income tax and deffered tax liability</u>

          Account                        Debit Credit

Income Tax Expense              32000  

To Deffered Tax Liability                    4000

To Income Tax Payable                                    28000

3 0
3 years ago
Wakefield Hospital has only one portable X-ray machine. The emergency room staff claim to have the greatest need for the machine
Anton [14]

Answer:

b. scarce resources.

Explanation:

Scarcity is one of the basic economic problems. Scarce resocurces means that resources needed to satisfy human wants are available in limited quantities.

In this question, the portable X-ray machine is the scare resource.

I hope my answer helps you

6 0
2 years ago
The government of Ruritania has implemented many programs that promote equality, but has become concerned about the very slow ra
IceJOKER [234]

Answer: b. reduce taxes and cut back on some social programs

Explanation:

When the Economy is not doing well, Social programs are usually targeted as they usually take a lot of money from the Government's coffers.

It is also a generally held view that reducing taxes as a Fiscal policy can help stimulate the Economy by leaving the public with more funds to invest in and spend on the Economy.

The Government of Ruritania is therefore most likely to combine reducing Social programs as well as reducing taxes. This will have the effect of leaving the Government with some money as it loses revenue from taxes whilst also enabling the public to have more money to invest and to spend which will then lead to Economic growth.

8 0
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