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meriva
3 years ago
6

On January 1 of this year, Diaz Boutique pays $105,000 to modernize its store. Improvements include new floors, ceilings, wiring

, and wall coverings. These improvements are estimated to yield benefits for 10 years. Diaz leases (does not own) its store and has eight years remaining on the lease. Prepare the entry to record the cost of modernization and amortization at the end off this current year.
Business
1 answer:
Dominik [7]3 years ago
8 0

Answer:

Explanation:

The journal entries are shown below:

1. Leasehold expense A/c Dr $105,000

        To Cash A/c $105,000

(Being the cost of modernization is recorded)

2. Amortization expense - Leasehold A/c Dr $10,500

           To Leasehold A/c $10,500

(Being amortization expense is recorded)

The computation is shown below:

= Purchase cost  ÷ estimated yield benefits

= $105,000 ÷ 10 years

= $10,500

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Answer: a. always declines with increased levels of output.

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3 years ago
Reserves decrease if the Federal Reserve?a. raises the discount rate or auctions more credit. b. raises the discount rate but no
sweet-ann [11.9K]

Answer:

D. lowers the discount rate but not if it auctions more credit

Explanation:

Discount rate adjustment and Federal Reserve's auction have the following effects on reserves.

Discount rate adjustment: a <em>higher discount rate</em> will encourage investment in the US economy, thus leading to <em>increased reserves</em> as investment inflows increase.

On the other hand, a <em>lower discount rate</em> encourages investment outflow into other jurisdictions with higher yields, <em>thus reducing reserves</em>.

Auction: <em>auctioning more credit</em> will result in the movement of investment flows into the Federal Reserve (<em>an increase in reserves</em>) as investors invest in auctions. Vice versa.

Therefore, a mix of lower discount rate and not auctioning more credit will result in lower reserves.

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hope this helps
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3 years ago
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To learn more about Strategic Trade
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1 year ago
Net sales is computed by? taking:
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