Answer:
d. A larger fixed assets turnover ratio and a larger gain on asset disposal
Explanation:
Accelerated depreciation is a method of depreciation whereby the book value of an asset is rapidly depreciated or reduced i.e at an accelerated rate.
This method usually minimizes taxable income in the initial years as a higher amount of depreciation is claimed.
Fixed assets turnover ratio refers to what percentage of net sales is attributable to an entity's fixed assets. It is expressed as:
Gain on sale of asset disposal = Sale value - Book Value
Book Value = Cost less accumulated depreciation till date
As can be seen, Average fixed assets balance would reduce thereby increasing fixed assets turnover ratio.
Similarly, due to higher depreciation charged, Book Value would be comparatively less, which would lead to larger gain on assets disposal in the initial years.
Answer:
The cash flows from operating activities to be reported on the statement of cash flows prepared by the indirect method would be $108,099
Explanation:
Cash Flow from Operating Activities adjusts the Net Income for the Year with (1) Non-Cash Items, (2) Items Appearing Elsewhere (3) Changes in Working Capital.
From the given data Net Cash flow from Operating Activities is Determined as follows:
<u>Cash flow from Operating Activities</u>
Net income $124,042
<em>Adjustment for Changes in Working Capital.</em>
Increase In Trade Receivables (61,370-45,427) ($15,943)
Net Cash flow from Operating Activities $108,099
Answer:
The answer is 0.01082
Explanation:
The formula for forward exchange rate is:
F = S x 1+rd/1+rf
where F is the forward exchange rate
S is the spot exchange rate(0.010798)
rd is the foreign currency interest rate(3% or 0.03)
rf is the domestic interest rate(3.75% or 0.0375
Month is 3 months(90days) and total number of days in a year is 360days.
Find find the attached file for calculation
Saves more than it spends.
Answer:
Profit : $297,000
Explanation:
Revenue is the earnings generated by a business by selling products and services. Expenses are the cost incurred in the process of generating revenue for the business.
A business will make profits if revenue exceeds expenses.
In this case, the revenue ($895,000) exceeds expenses($598,000). Therefore, the business will make a profit.
The profit will be revenue minus expenses
=$895,000 -$598,000
=$297,000
