Answer:
I agree with the owner of the company
Explanation:
The overall losses are $40,000 per month and the fixed costs are $30,000 per month.
The company should stop production because the losses are over fixed cost and this tells us that the company is not even able to recover the variable costs and because the variable costs are not at least recovered, there would be no point for the company to continue in the business as it would keep on making a loss and the logic might be wrong regarding sunk costs but the decision must be taken in favour where production should be stopped.
I would say 2189 as tax refunds ps the question is unfull
Answer:
a.a debit to Cash Dividends for $120,000.
Explanation:
The amount of dividend paid is dependent on two function; the number of shares and the amount declared for payment per share.
When it is paid, a credit is posted to cash account and the corresponding debit is posted to the dividend paid account.
As such, since the company has 80,000 shares and the declared dividend was $1.50,
Total dividend paid = $1.50 × 80000
= $120,000.
Hence cash dividend is debited with $120,000 on payment.
Answer:
Fee Receivable$7,200
To Service Fees Earned $7,200
(Being the service fess earned is recorded)
Explanation:
Th adjusting entry is shown below:
Fee Receivable$7,200
To Service Fees Earned $7,200
(Being the service fess earned is recorded)
For recording this we debited the fees receivable as it increased the assets and credited the services fees earned as it increase the revenues
Since the payment is made for 6 months but we have to recorded for 4 months i.e computed from September 1 to December 31
= $10,800 × 4 months ÷ 6 months
= $7,200
