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seraphim [82]
3 years ago
12

Sahia company bought a building for 90,000 cash and the land on which it was located for 1,10,000 cash. The company paid a trans

fer cost of 10,000. Renovation cost on the building were $31,000.1. What would be the net book value of the property (land and building) at the end of year 2?2. Prepare the journal entry to record the purchase of the property, including all relevant expenditures. Assume that all transactions were for cash and that all purchases occurred at the start of the year.3. Compute straight-line depreciation at the end of one year, assuming an estimated 10-year useful life and a $9,000 estimated residual value. Straight-line depreciation 106,000
Business
1 answer:
Alexxandr [17]3 years ago
6 0

Answer:

Sahia Company

1. Net book value of the property at the end of year 2 = $217,800.

2. Journal entry to record the purchase:

Debit Property (land and building) $241,000

Credit Cash Account $241,000

To record the acquisition of the property.

3. Straight-line depreciation (on building only) = $11,600.

Explanation:

a) Data and Calculations:

Bought building for cash = $90,000

Bought land for cash =         110,000

Transfer cost =                       10,000

Renovation on building =      31,000

Book value of property =  $241,000

Depreciation:

Building cost = $90,000

Transfer cost        4,500 ($10,000*90,000/200,000)

Renovation         31,000

Total cost =    $125,500

Residual value     9,000

Depreciable value = $116,000

Depreciation per annum = $11,600 ($116,000/10)

a) Land is not subject to depreciation and its value is $115,500 or $110,000 + 5,500 ($10,000*110,000/200,000).

b) The net book value of the property at the end of year 2 is

Building $125,500 - 23,200 = $102,300

Land =                                          115,500

Net book value of property =  $217,800

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Answer:

Sam’s Home Store can enforce the contract against Restore Construction Company

Explanation:

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6 0
3 years ago
1-a. Assume that Andretti Company has sufficient capacity to produce 120,150 Daks each year without any increase in fixed manufa
likoan [24]

Answer:

The answer is given below;

Explanation:

The opportunity gain of investing in fixed selling expenses could be quantified by comparing with interest rates prevailing in the market.

if the net margin earned on producing extra quantity is greater than the return earned on placing funds in bank account,then it is financially viable to invest in fixed selling expenses and vice versa.

7 0
3 years ago
NoFly Corporation sells three different models of a mosquito "zapper." Model A12 sells for $61 and has variable costs of $43. Mo
pochemuha

Answer:

See explanation

Explanation:

We first calculate weighted avg total break even point.

The formula or this is,

Total Break even = Total fixed costs / Weighted avg contribution

Weighted avg contribution = (Contribution of A12 * Weight of A12) + (Contribution of B22 * Weight of B22) + (Contribution of C124 * Weight of C124)

Contribution/ Product =

A12 = 61 - 43 = $18

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C124 = 413 - 316 = $97

Thus,

Weighted avg Contribution = (18*0.56) + (30*0.27) + (97*0.17) = $34.67

Total Break even = 249624/ 34.67 = 10085 units in total

Simply multiply total break even units with each products weight to calculate qty for each product to b produced.

A12 = 10085*0.56 = 5647.6 units

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A12 = 249624/18 = 13868 units

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6 0
3 years ago
Rocky Guide Service provides guided 1–5 day hiking tours throughout the Rocky Mountains. Wilderness Tours hires Rocky to lead va
slega [8]

Answer:

$79,750

Explanation:

On July 15 - for 10 days tour guide

Debit - Accounts Receivable ----- $29,000

Credit - Service rendered  -------- $29,000

On July 31 - for 15 days tour guide

Debit - Accounts Receivable ----- $50,750

Credit - Service rendered  -------- $50,750

Note - Service rendered =  Daily pay ($2,900 * 15) + Daily bonus for 25 days ($290 * 25) = $43,500 + $7,250 = $50,750

On July 31

Debit - Accounts Receivable ----- $79,750

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8 0
3 years ago
The company can manufacture either 3 couches per machine hour or 2 ​bed(s) per machine hour. The​ company's production capacity
e-lub [12.9K]

Answer:

Based on the available information, the company should produce 27,900 units of  couches in a month. This decision may be different  if we have the product profitability information in terms of contribution of each product.

                                                         

Explanation:

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Available Capacity (Machine hour per month)                9,300           9,300

Total possible production (unit) (9,300 x 3)-Couches   27,900

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Based on the available information, the company should produce 27,900 units of  couches since it is the production activities that produces a higher number of units in a month compared to the production of beds which can only yield 18,600 units  considering the available production capacity of 9,300 machine hours per month.

The decision may be different if we have the product profitability information in terms of contribution of each product.

4 0
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