Answer:
An update of the fair value adjustment account,
Removal of the related investment account balances
The total amount of gain or loss that has occurred since the securities were purchased
Explanation:
The activities that occurred between the purchase and during the sales of bonds classified as trading securities will determine the entries to be recorded.
First, since it was an investment, it means, it had an entry already in the books. Its sales therefore, will mean the books needs to be updated and this will be done through the Fair value adjustment account.
Secondly in updating the fair value, there is the need to remove the related investment account balance. This is because the investment has been sold so it should not be reflected any more.
Thirdly, since the investment was bought at a point, carried for a while and then eventually sold, some gain or loss would have been generated between its acquisition and its sales, therefore the entry for total amount of gain or loss that occurred since the purchase should be made.
Part 4
The items such as the
Answer:
$12,100
Explanation:
The contribution margin of a product may be defined as the price of the product minus the associated variable cost which results in the incremental profit that is earned when one unit of the product is sold. It is obtained by subtracting the total variable cost from the total sales of the product.
In the context, the total contribution margin of a product for the month under the variable costing would be $12,100 for the manufacturing company.
Given that the company has to invest $5,000,000.00 custom-made machine with a life span of 2 years that will manufacture a total of 500,000 units in a year. Using the machine will reduce the costs in labor for $5.50/unit and maintenance for $0.95/unit, total of $6.45 per unit savings. For 2 years, the machine can manufacture a total of 1,000,000 units with total savings of $6,450,000.00 for both labor and maintenance. Since the machine's life is only 2 years with no salvage value, the company's total cost savings after the end of 2 years would be $1,450,000.00.
Answer: The correct answer is A) Net Income would be overstated (Expenses understated) and Balance Sheet liabilities would be understated.
Explanation: An omission of a posting of an expense incurred during a financial year and payable in thesubsequent year will lead to an understatement of expenses and understatement of liabilities.
In general, when an expense is omitted it leads to increased net income as less expense will be knocked off against income.
The balance sheet on the other hand will be understated in terms of a reduced liability balance.
The paradox is the one that says that' SOMETIMES DOING NOTHING IS THE BEST REACTION'. This paradox states that if the counterinsurgents assess a situation and discover that their reaction will bring more bad than good, in such a situation an alternative action should be considered including not reacting at all.
