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Artyom0805 [142]
3 years ago
12

Vert Company purchased Dextrin common stock for $150,000. At December 31, Year 2, the Fair value adjustment account had a debit

balance of $10,000. On December 31, Year 3, the fair value of that investment was $154,000. Which of the following will be included in the related journal entry dated December 31, Year 3?a) Debit to Fair value adjustment for $4,000b) Credit to Fair value adjustment for $6,000c) Debit to Fair value adjustment for $14,000d) Credit to Fair value adjustment for $16,000
Business
1 answer:
VashaNatasha [74]3 years ago
7 0

Answer:

B. Credit to the fair value adjustment for $6000

Explanation:

December 31 (year 2)

Fair value adjustment account balance = $10,000 (Debit)

December 31 (year 3)

Fair value adjustment account balance = $154,000 - $150,000 =$4,000 (Debit)

As you can see in year 2 there were only $10,000 (debit) in fair value adjustment account but in year 3 the value dropped down to 4,000 debit which leads us to the journal entry of $6,000 Credit in fair value adjustment account balance

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You are scheduled to receive a $500 cash flow in one year, a $1,000 cash flow in two years, and pay an $800 payment in three yea
Sunny_sXe [5.5K]

Answer:

present value = $9320.06

Explanation:

given data

cash flow 1 year C1 = $500

cash flow 2 year C2 = $1000

pay 3 year C3  = $800

interest rates  r = 10 percent per year = 0.10

solution

we get here present value that is

present value = \frac{C1}{(1+r)} +\frac{C2}{(1+r)^2} +\frac{C3}{(1+r)^3}   ....................1

put here value and we will get

present value =  \frac{500}{(1+0.10)} +\frac{10000}{(1+0.10)^2} +\frac{800}{(1+0.10)^3}

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7 0
3 years ago
If the supplies on hand at the end of January totaled $500 and the Supplies on Hand account before adjustment is $900, what shou
Natali5045456 [20]

Answer:

The adjustment at month-end is :

Supplies Expense $400 (debit)

Supplies $400 (credit)

Explanation:

The Supplies Account is an asset Account that decreases as the supplies are used in the business.

The use of supplies prompts the recognition of an <em>expense</em> and de-recognition of an <em>asset</em> as follows :

<em>Supplies Expense $400 (debit)</em>

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AURORKA [14]

Answer:

c. Reward power

Explanation:

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Answer:

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There is not sufficient information to support Option C

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