Banking and credit

Machinery is purchased on July 1 of the current fiscal year for $240,000. It is expected to have a useful life of four years, or

xenn [34]

Answer:

a. $28,125

b. $60,000

c. $14,400

Explanation:

The computation of the depreciation expense for the last six months is shown below:

a) Straight-line method:

= (Purchase value of machinery - residual value) ÷ (useful life)

= ($240,000 - $15,000) ÷ (4 years)

= ($225,000) ÷ (4 years)

= $56,250

In this method, the depreciation is same for all the remaining useful life

So, for 6 months it would be

= $56,250 × 6 months ÷ 12 months

= $28,125

(b) Double-declining balance method:

First we have to find the depreciation rate which is shown below:

= One÷ useful life

= 1 ÷ 4

= 25%

Now the rate is double So, 50%

In year 1, the original cost is $240,000 so the depreciation is $60,000 after applying the 50% depreciation rate and 6 months

(c) Units-of-production method:

= (Purchase value of machinery - residual value) ÷ (estimated operating hours)

= ($240,000 - $15,000) ÷ (25,000 operating hours)

= ($225,000) ÷ (25,000 operating hours)

= $9 per hour

Now for the current year, it would be

= Estimated operating hours in the current year × depreciation per hour

= 1,600 hours × $9

= $14,400

8 0

3 years ago

Whitman Printing has contracts to complete weekly supplements required by forty-six customers. For the year 20X5, manufacturing

stellarik [79]

Answer:

a. contribute too little to profits, and Wallace Printing will not want to accept additional work from the company.

Explanation:

For reaching any conclusion first we have to determine the cost assigned by using the single cost driver which is shown below:

= Rate × Pages printed

= ($840,000 ÷ 12,000,000) × 76,000

= $5,320

And Cost assigned using ABC is

= (120,000 ÷ 200) × 2 + (640,000 ÷ 4000) × 10 + (80,000 ÷ 16000) × 38

= $2,990

By this above calculation, the first option is chosen as the cost are high as compared to the ABC while on the other hand the profit would be NIL

5 0

4 years ago

When buying an existing business, the potential buyer should remember that:?

Ne4ueva [31]

Is this a good location.Does it need repairs. Will I make profit back from this purchase.

8 0

3 years ago

What role does savings play in the process of economic growth

matrenka [14]

Answer:

The role played by banks in the economic growth is that savings promote the generation of loans, and generate funds to new businesses.

Explanation:

Banks use the funds on the savings accounts to generate credits to other clients that might be persons or companies.

Suppose that you have $1000 dollars saved in your bank account. Then, your bank only needs to keep a deposit of the 10% from the $1000. This means to save $100 and use the rest $900 to generate credits to other customers.

The $900 remaining will be loan to individuals or companies to finance new projects such as: Buying a car, house, invest in machinery or re design a branch from a cloth store.

These projects boost economic growth as they move the economy with consumption, and investment.

6 0

3 years ago

Do you agree with Unilever’s decision to link its brands with efforts to encourage healthy and environmentally sustainable behav

o-na [289]

Answer:

Yes.

Explanation:

I agree with Unilever’s decision to link its brands with efforts to encourage healthy and environmentally sustainable behaviors because it is an innovative way to catch more customers who might have been in doubt of their products due to health and other related issues. It also presents a good image of the company and shows that Unilever is not only out there to sell their products and maximize profits but also to make sure that the consumers of their products are healthy and satisfied. This will help them retain their customers as well as to build unflinching loyalty.

3 0

4 years ago

Banking and credit ​

Banking and credit