Answer:
Blue Co. should report $100,000 gain.
Explanation:
The difference between the carrying value of shares and Market value of shares is the gain / loss which Blue Co. should report before income taxes on disposal of the stock.
Carrying Value = 200,000 x $2 = $400,000
Market Value = 200,000 x $2.5 = $500,000
Gain = Market Value - Carrying Value
Gain = $500,000 - $400,000
Gain = $100,000
Expected Family Contribution- it’s the index measure of the families financial strength to determine how much financial aide the school will need to provide.
Answer:
Journal Entries:
Dec 31 Bad Debts Expense $4875
Allowances for doubtful accounts $4875
Feb 1 Allowances for doubtful accounts $580
Accounts Receivable - P.Park $580
June 05 Accounts Receivable - P.Park $580
Allowances for doubtful accounts $580
June 05 Cash $580
Accounts Receivable - P.Park $580
Explanation:
On December 31 Chen estimates the potential receivable expected to be not paying to him. Therefore, he write off the receivable from balance sheet using the percentage of sales method of receivable of ($975000 x 0.5% = $4875). On Feb 1 Chen write off P.Park from receivable of $580 as he comes to know he will not pay but on June 5 P.Park pay him $580. First Chen reinstate the receivable afterwards he collect cash from receivable.
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Answer:
a. 0.89
b. 86.67%
c. $37,600
Explanation:
A. Current ratio = Current Assets / current liabilities
= 252,500 / 284,500
= 0.8875
= 0.89
B. Debt to assets ratio = Total liabilities / Total assets
=$374,000 / $431,500
=0.8667%
= 86.67%
C. Free cash flow = Net cash provided by operating activities - Capital expenditure
= $62,100 - $24,500
= $37,600
