Answer:
<em> </em><em>Journal Entries - Ryan Management (In millions)
</em>
Date Particulars and Explanation Debit Credit
31-Dec-22 Income tax expense $
52.5
To Income tax payable $50.0
($200 * 25%)
To Deferred tax asset $2.5
[($50 - $40)*25%]
(To record income tax expense and reversal of DTA)
Answer:
Queen $32,850
Stevens $180,150
Explanation:
Queen Stevens Net Income
available (distributed)
Net Income $213,000
Interest on Capital (6%) $4,500 $6,300 <u>($10,800)</u>
$202,200
Salary Allowance $117,150 <u>($117,150)</u>
$85,050
Remaining $85,050 $28,350 $56,700 ($65,050)
(in ratio 1:2)
Total Net Income $32,850 $180,150 ($0)
distributed
Interest is capitalized when incurred in connection with the construction of plant assets because, during construction, the asset is not generating revenue
<h3>What is Interest?</h3>
This refers to the amount or rate that is added to a principal amount and this is usually done when a loan is collected.
Hence, we can see that when plant assets are being constructed, interest is capitalized and the main reason why this happens is that the asset is not generating revenue.
Furthermore, actual interest is the only thing that should be capitalized and this is because, during construction, the asset is not generating revenue and therefore companies should defer (capitalize) interest cost.
Thus, Interest is capitalized when incurred in connection with the construction of plant assets because, during construction, the asset is not generating revenue.
Read more about interest capitalization here:
brainly.com/question/417585
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Answer:
$300,000
Explanation:
A contract is formed between different parties when there is an offer and acceptance of terms in performance of a job.
In construction contracts where a construction company enters a contract to build a warehouse for Vincent Corporation. The amount they will lost profits depends on which party is breaching the contract and at which project stage it happens.
In this case the contract was breached by the owner before project began. Damages/lost profits are project price less project cost.
Lost profit= 700,000 - 400,000= $300,000
