In 2020, Neighbor Co-Op Inc. sells 1,000 beverages in glass bottles and receives a $1.00 deposit for each returnable bottle sold
. As of December 31, 2020, a total of 800 glass bottles were returned and deposits on 120 bottles were forfeited because it is the company's policy that a deposit must be claimed within 30 days. The remaining 80 bottles are still with customers within the 30-day claim period. Required:
a. Record the collection of deposits in 2020.
b. Record the return of glass bottles in 2020.
c. Record the forfeiture of deposits in 2020 assuming that the cost of each bottle is $0.80.
Transactions must be recorded separately inside this debt or equity portion as both a drop to income of $450,000 as well as a rise of $700,000.
The accounting equation for a business must show steady income through operational operations.
These variations on obligations, investors' capital, other tangible resources may be used to reflect about the difference on income.
A firm's first stage of development is prone to experience operational and investment income stream. retained earnings through funding that is profitable.
1)The quantity of money that exists for usage in free liquidity
2)pay off existing debt
3)By engaging in further investment activities, grow the company.
4)increase the company's cash position
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The correct option is D. A leading indicator refers to an economic factors that is measurable and which changes before the economy begin to follow a particular pattern. Leading indicators are used by economists to predict changes in the economy of a nation and the government uses it to make necessary adjustment to the monetary policy. Economists calculation which accurately predicts business cycle is an example of leading indicator that can predict changes in the real GDP. <span />