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Oliga [24]
3 years ago
14

Romanova Inc. decides to sell an old piece of equipment and receives $5,000 cash for it. The original cost of the equipment was

$50,000 and it had accumulated depreciation of $47,000 associated with it. Which of the following items would be increased by the sale of the old equipment?
a- Gain on Saleb- Net Incomec- Cash from Operating Activitiesd- Cash from Investing Activitiese- Total Assets
Business
1 answer:
denpristay [2]3 years ago
7 0

Solution :

The carrying value of the asset = 5000-47000

                                                    = 3000

Equipment that is sold for 5000, therefore, the profit is 2000.

The net income gain on the sale - increase, the company is getting a gain from the sale.

The cash from the investing activities-increased. Thus the proceeds from the sale of the assets are recorded as the cash inflow.

The cash from the operating activities -- no change. While we calculate the operating cashflow, the gain on the sale of the assets added back to the income. So there is no change in the total.

The total assets -- increased. The carrying value will be zero after the sale, however, the cash on the balance sheet is then increased and it also captures gain. Now in order to balance the both sides, the net income increases the retained earnings section.

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Answer: None of the other answers are correct, because all of these variance combinations are possible.

Explanation:

All of the above combinations are possible.

A company can have an Unfavorable labor rate variance and a favorable labor efficiency variance meaning that the actual labor rate was more than the budget rate but the budgeted labor Efficiency rate was more than the actual rate.

A company can also have an Unfavorable labor efficiency variance and a favorable material quantity variance meaning that even though labor Efficiency was not satisfactory, less materials were still used than were budgeted for.

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Television Advertising is the most expensive form of advertising.

Explanation:

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Big events such as the super bowl have an expensive fee for the companies that want to air an add. The most expensive add ever is No. 5 the Film (2004) is a 180-second short film directed by Baz Luhrmann for the perfume company Channel, this advertising had a budget of $33 million dollars.    

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4 years ago
A computer company had $3,000,000 in research and development costs. Before recording these costs, the net income of the company
JulijaS [17]

Answer:

Net income of the company accounted for $400,000

Explanation:

Net income is the income or the amount of residual income from the earnings after deducting all the expense or cost from the sales.

The net income or loss of the company accounted for is computed as:

Net Income or Loss = Net Income - Research and Development cost

where

Net Income amounts to $3,400,000

Research and Development cost amounts to $3,000,000

So, putting the values above:

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