A code of ethics adopted by a company will most likely include all of the following EXCEPT

Acme Enterprises just bought a new manufacturing machine. Which of these costs should be capitalized? (Check all that apply.)

ankoles [38]

Answer:

Option D, E and F. See below for information.

Explanation:

Costs are capitalized when they form a principal part of the asset. These costs may include any costs that are needed to make the asset operational and any costs that are incurred to bring the asset to operating premises.

As such the $15,000 freight bill that brings the asset in premises, the invoice price of $500,000 which comprises the cost of the capital asset and the one time cost of $8,000 to tear down the wall and install the asset are all capital costs and are to be capitalized in the final cost of the asset to be recorded.

All other are annual expenses are not to be capitalized (Option a, b and c)

Hope that helps.

4 0

3 years ago

Davis is planning to buy a bike. He has the full amount in his bank account. He does not want to pay any interest on his purchas

professor190 [17]

Answer:

C

Explanation:

7 0

3 years ago

Which of the following types of inventory describes inventory that has been purchased but not processed?

PtichkaEL [24]

Answer:

A. raw material inventory

Explanation:

Inventory materials are basically of 3 types namely; Raw materials, semi-finished goods and finished goods.

Raw materials are inventory materials yet to be processed. It is usually referred to as material cost.

Inventory items that have been processed but yet to be finished are called semi finished goods. Such items are also called work-in-process inventory.

Finished goods are inventory items ready to be sold.

Based on the above statements, the right option is A. raw material inventory.

3 0

4 years ago

In the past year, TVG had revenues of $2.95 million, cost of goods sold of $2.45 million, and depreciation expense of $178,000.

Firdavs [7]

Answer:

3.5

Explanation:

Computation for the firm’s times interest earned ratio

Revenues$ 2.95 million

Cost of goods sold$ 2.45 million

Depreciation expense$ 178,000.00

Book values of Debt outstanding$ 1.15 million

Interest rate8.00

First step is to calculate for the EBIT

Using this formula

EBIT= Revenues -(Cost of goods sold +Depreciation expense$ 178,000.00)

EBIT=$2,950,000-($2,450,000+$178,000)

EBIT=$2,950,000- $2,628,000

EBIT=$322,000

Second step is to find the Interest

Using this formula

Interest =Debt outstanding with book value ×Interest rate

Let plug in the formula

Interest =$1,150,000×8%

Interest =$92,000

Now let find the firm’s times interest earned ratio

Using this formula

Firm’s times interest earned ratio=EBIT/INTEREST

Where,

EBIT=$322,000

INTEREST=$92,000

Let plug in the formula

Firm’s times interest earned ratio=$322,000/$92,000

Firm’s times interest earned ratio =3.5

Therefore the firm’s times interest earned ratio will be 3.5

7 0

4 years ago

A project will produce cash inflows of $5,400 a year for 3 years with a final cash inflow of $2,400 in Year 4. The project's ini

diamong [38]

Answer:

Net Present Value (NPV) is 506

Explanation:

See document attached. To get the net present value, we make a cash flow in excel.

At moment 0 we have the investment cost , in this case $13,400. From period 1 to period 4, we have different incomes. Then, we calculate the Net cash flow that is the difference between benefits and cost.

To get net present value, we use VNA formula.

=VNA(required rate of return; Net cash flow from moment 1 to moment 4 )+Net cash flow at moment 0

Download xlsx

6 0

3 years ago