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Anika [276]
2 years ago
6

(L.O. 2) Nolan Company sells its product on an installment basis, earning a $450 pretax gross profit on each installment sale. F

or accounting purposes the entire $450 is recognized in the year of sale, but for income tax purposes the installment method of accounting is used. Assume Nolan makes one sale in 2019, another sale in 2020, and a third sale in 2021. In each case, one-third of the gross sales price is collected in the year of sale, one-third in the next year, and the final installment in the third year. If the tax rate is 50%, what amount of deferred tax liability should Nolan Company show on its December 31, 2021 balance sheet:
Business
1 answer:
Maksim231197 [3]2 years ago
5 0

Answer:

$225

Explanation:

Calculation to determine what amount of deferred tax liability should Nolan Company show on its December 31, 2021 balance sheet:

Deferred tax liability =[ ($450/ 3) *50%]+ [($450 / 3 * 2) * 50%]

Deferred tax liability=$75+$150

Deferred tax liability = $225

Therefore the amount of deferred tax liability should Nolan Company show on its December 31, 2021 balance sheet is $225

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Reserves$72Checkable Deposits$240 Securities110Loans from Federal Reserve Banks2 Loans60 Consolidated Balance Sheet: Federal Res
mamaluj [8]

Answer:

d. directly increase by $2 and the money-creating potential of the commercial banking system will increase by $6

Explanation:

Note: The organized table of the question is attached as picture below

Total increase in money supply = (1/Reserve ratio)*2

Total increase in money supply = (1 / 0.25) * 2

Total increase in money supply = 4 * 2

Total increase in money supply = 8.

Out of which 2 is directly increased because fed deposits 2 into checking deposits and 6 is indirectly increased.

5 0
2 years ago
If you put off making a decision or performing a task, you are _______.a.Weightingb.Prioritizingc.Analyzingd.Procrastinating
Nimfa-mama [501]
Procrastinating, the others are almost antonyms
5 0
3 years ago
Read 2 more answers
"A retired customer that has a portfolio of blue chip stocks is looking to supplement his retirement income. An appropriate reco
NeTakaya

Answer: sell covered calls

Explanation:

A retired customer that has a portfolio of blue chip stocks is looking to supplement his retirement income. An appropriate recommendation would be to sell covered calls.

It should be noted that a covered call is a financial transaction that takes place when a call option is sold by an investor even though the investor still owns part of the security based on what's sold.

7 0
3 years ago
A checking account is sometimes called a..
asambeis [7]
B
a demand deposit lets you withdraw money without advice notice 
6 0
3 years ago
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Cardinal Industries purchased a generator that cost $11,000. It has an estimated life of five years and a residual value of $1,0
atroni [7]

Answer:

Correct answer is letter D, $11,000 cost, five-year life and $1,000 salvage value

Explanation:

To compute depreciation expense of an asset using straight-line method of depreciation, the information we needed is 3,

1. cost of an asset

2. life of an asset (in year)

3. residual value (if available)

<em>* residual value of an asset is to be determined by the company, some asset don't have scrap value assigned.</em>

<em />

<em>FORMULA </em>

<em>The difference between the cost of an asset and the expected residual value over the number of years it is expected to be useful.</em>

<em>(cost of an asset - residual value ) / life of an asset</em>

6 0
3 years ago
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