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Fittoniya [83]
3 years ago
10

In 2017, Bust Company requested and received permission from the IRS to switch its accounting method from the cash method to the

accrual method. Taxable income in 2017 (computed under the accrual basis) was $110,000. At the end of 2017, Bust had accounts receivable of $32,000; accounts payable of $27,000; and merchandise inventory of $10,000. Determine Bust Company's taxable income after all (if any) adjustments. Is any relief available to Bust Company
Business
1 answer:
kirill115 [55]3 years ago
3 0

Answer:

$105,000

Explanation:

Calculation to determine Bust Company's taxable income after all adjustment

Using this formula

Taxable income after Adjustment=Taxable income in 2017-(accounts receivable-accounts payable )

Let plug in the formula

Taxable income after Adjustment=$110,000-($32,000-$27,000)

Taxable income after Adjustment=$110,000-$5,000

Taxable income after Adjustment=$105,000

Therefore Bust Company's taxable income after all adjustment is $105,000

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Aleonysh [2.5K]

Answer: Insurance premium

Explanation:

4 0
3 years ago
Braam fire prevention corp. has a profit margin of 9.70 percent, total asset turnover of 1.52, and roe of 18.58 percent. what is
Novosadov [1.4K]

Braam fire prevention corp. has a profit margin of 9.70 percent, total asset turnover of 1.52, and roe of 18.58 percent. The firm's debt-equity ratio will be 0.91.

<h3>What is debt- equity ratio?</h3>

A phrase used in accounting to describe the capital structure of a company is the debt-equity ratio. This ratio is computed specifically by dividing a company's total debt by its entire equity.

<h3>monetary ratios</h3>
  • Financial ratios are measurements that analysts use to assess business performance and to compare those ratios with other companies in the same industry. They are evaluated according to the firm's financial statements.
  • The liquidity ratios, solvency ratios, profitability ratios, and market outlook ratios are the common classes into which the financial ratios can be divided. Each lesson will highlight a different aspect of the company.
  • Before performing their analysis, analysts should, however, evaluate the completeness and transparency of the provided financial statements. The financial statements could be manipulated by some internal investors for personal gain.

ROE = profit margin × asset turnover × equity multiplier

18.58% = 9.70% × 1.52 × equity multiplier

equity multiplier = 1.91

Then debt-equity ratio is calculated as:

debt-equity ratio = equity multiplier - 1

debt-equity ratio = 1.91 - 1

debt-equity ratio = 0.91

To learn more about equity ratio from given link

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7 0
1 year ago
Austin Company allocates manufacturing overhead based on machine hours. Each chair produced should require 4 machine hours. Stan
dangina [55]

Answer:

$114 unfavorable variance

Explanation:

Austin produced 510 chairs:

estimated machine hours                          actual machine hours

    2,040 hours                                                       2,100

estimated variable overhead                   actual variable overhead

   $11,016                                                               $11,130

the variable overhead efficiency variance is $11,016 - $11,130 = -$114

a negative number means that the variable variance is $114 unfavorable

8 0
4 years ago
On average, how much money is expected to be spent per person for halloween this year?.
valina [46]

This Halloween, it's anticipated that each person would spend, on average, $100.45.

Halloween, which is observed annually on October 31st, is also known as All Saints Eve or All Hollow's Eve because it was historically observed to signal the end of the harvest season and the start of the chilly, harsh winters. The night before the new year, according to the Celts, the line between the worlds of the living and the dead fuzzed. Samhain, when Halloween was thought that the spirits of the dead made a comeback to earth, was celebrated on the evening of October 31. The term "spend" is the verb's present-basic form. Second, despite referring to the past tense and past participle of the verb "spend," the term "spent" can also be employed as a verb or an adjective. To disburse cash for the sake of a person, thing, or cause is called spend.

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5 0
1 year ago
You have been asked to prepare a December cash budget for Ashton Company, a distributor of exercise equipment. The following inf
Lorico [155]

Answer:

Explanation:

Required:1.Calculate the expected cash collections for December. CREDIT SALES COLLECTIONS HISTORY20 % in the month of Sale (OCTOBER) 60 % in the First month after Sales (NOVEMBER) 18 % in the Second month after Sales (DECEMBER) 2 % Projection of Uncollectible Accounts receivable 100 %CASH COLLECTIONS FOR DECEMBER December cash sales................................................$83,000Collections on account:October sales: $400,000×18%.............................72,000November sales: $525,000×60%.........................315,000December sales: $600,000×20%.........................120,000Total cash collections..........................................$590,0002.Calculate the expected cash disbursements for merchandise purchases for December. CASH PAYMENTS HISTORY 30 % Paid in the month of purchases 70 % Paid in the First Month after purchased 100 % CASH PAYMENTS TO SUPPLIERSNovember purchases (accounts payable)..............$161,000December purchases: $280,000×30%.................84,000Total cash disbursements......................................$245,000

3.Prepare a cash budget for December. Indicate in the financing section any borrowing that will be needed during the month. Assume that any interest will not be paid until the following month. ASTHON COMPANY CASH BUDGET FOR MONTH ENDED 12-31-17 Cash Balance 12/1 40 000 Add: Cash Receipts Collections from customers 590 000 Total Cash Available 630 000 Less: Cash Disbursements Payments to suppliers 245 000 Selling & Administration Expenses 380 000 (Total - depreciation = 430 000 - 50 000) New Web Server 76 000 Dividends Paid 9 000 Total Cash Disbursements 710 000 Excess (deficiency) of cash available over disbursements (80 000) Financing: Borrowings 100 000 Repayments 0 Interest 0 Total financing 100 000 Ending cash balance 20 000

8 0
4 years ago
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