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Sever21 [200]
2 years ago
12

g Cole Co. began constructing a building for its own use in January 2021. During 2021, Cole incurred interest of $50,000 on spec

ific construction debt, and $20,000 on other borrowings. Interest computed on the weighted-average amount of accumulated expenditures for the building during 2021 was $40,000. What amount of interest should Cole capitalize
Business
1 answer:
slava [35]2 years ago
7 0

Answer: $40,000

Explanation:

Interest that is accrued as a result of a building should be capitialized to the cost of that building. The amount of interest payment that is due to the building will simply be the interest payment that the company would have avoided incurring had it not undertaken the construction of the building.

This amount is represented by the interest computed on the weighted-average amount of accumulated expenditures which in this case is $40,000 so that is the amount that should be capitalized by Cole Co.

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Santa Fe Company was started on January 1, Year 1, when it acquired $9,000 cash by issuing common stock. During Year 1, the comp
Nitella [24]

Answer:

All of the options are false.

Explanation:

The net income is an element that increases the owners' equity while dividend paid reduces it. Both are elements of the cash flows for operating and financing activities respectively.

Considering the information given;

Acquired $9,000 cash by issuing common stock - This is an inflow of cash and forms the owner's equity balance at the start of the year.

During Year 1, the company earned cash revenues of $4,500, paid cash expenses of $3,750 - These are elements of the income statement and will result in a net income of $500 ($4,500 - $3,750 - $250).

and paid a cash dividend of $250 - This is a reduction in the owner's equity and is a cash outflow.

Now a review of all the options;

a. The 2016 statement of cash flows would show net cash inflow from operating activities of $2,450. - Net  cash flow from operating activities is $750 (($4,500 - $3,750). Hence this is false.

b. The 2016 income statement would show a net income of $1,300. - As shown in the consideration, this is false.

c. The 2016 statement of cash flows would show a net cash flow from financing activities of $9,700.  - Net cash flow from financing is

= $9000 - $250 = $8750

d. The December 31, 2016 balance sheet would show total equity of $15,750 - Total equity

=$9000 + $4,500 - $3,750 - $250 = $9,500

Hence all of the options are false.

7 0
3 years ago
Rather than generating tax revenue as do tariffs, subsidies require tax revenue. Therefore, they are not an effective protective
KatRina [158]

Yes. Subsidies are benefits that the government can grant to institutions, households and businesses to promote economic efficiency and reduce market failures. They may be distributed through cash or by cutting tax rates. However, there is controversy about the effectiveness of using subsidies for the economy, often related to the inefficiency of promoting a free market, allocating resources that could be used for investment in productive resources and masking the results of economic efficiency. Another major concern with the use of subsidies is the formation of political alliances of those who receive them and those who provide them, creating political interests because of their use.

6 0
3 years ago
________is the american economist and professor who wrote the globalization of markets, in which he argued that international ma
dimulka [17.4K]

Answer: Theodore Levitt

4 0
2 years ago
A single marketing mix consists of one type of product with little or no variation, one price, one promotional program aimed at
adelina 88 [10]

Answer:

The correct word is one.

Explanation:

It is called marketing mix (also called commercial mix, etc.) to the tools or variables available to the marketing manager to meet the company's objectives. They are the marketing strategies, or marketing effort and should be included in the marketing plan (operational plan). The company uses this strategy when it seeks to monopolize more customers.

4 0
3 years ago
Costs such as transportation-out, sales commissions, uncollectible accounts receivable, and advertising costs are sometimes call
Flura [38]

Costs such as transportation-out, sales commissions, uncollectible accounts receivable, and advertising costs are sometimes called <u>direct costs.</u>

<h3>Wat are direct cost?</h3>

A direct cost is known to be the said price that can be said to be straightly linked or tied to the manufacturing of specific goods or services.

Not that A direct cost is one that  be known via to the cost object, that is it can be a service, product, or others.

Hence, Costs such as transportation-out, sales commissions, uncollectible accounts receivable, and advertising costs are sometimes called <u>direct costs.</u>

Learn more about direct costs from

brainly.com/question/26245657

#SPJ1

6 0
1 year ago
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