Answer:
Assets = Liabilities plus stockholders' equity = $18,340
Explanation:
(a) Set up an accounting equation in columnar form with the following individual assets, liabilities, and stockholders' equity accounts: Cash, Accounts Receivable, Equipment, Accounts Payable, Notes Payable, Common Stock, and Retained Earnings. Enter the January 1 balances below each item. (Note: The beginning Equipment account balance is $0.)
Note: See the attached excel file for the set-up.
(b) Show the impact (increase or decrease) of the January transactions on the beginning balances, and total all columns to show that assets equal liabilities plus stockholders' equity as of January 31.
Note: See the attached excel file for how the impacts are shown and the total of all columns
Also Note: See the lower part of the attached excel file to see that assets equal liabilities plus stockholders' equity as of January 31 where we have:
Assets = Liabilities plus stockholders' equity = $18,340
Answer:
14.7%
Explanation:
The computation of the return on investment is shown below:
As we know that
Return on Investment = Net Income ÷Average total assets × 100
where,
Net Income = Sales - Cost of goods sold - Operating expense
= $4,525,000 - $2,550,000 - $1,372,000
= $603,000
And, the Average total assets = $4,100,000
So,
Return on Investment is
= $603,000 ÷ $4,100,000 × 100
= 14.7%
Answer:
AAA Inc. and ZZZ Inc.
AAA Inc ZZZ Inc.
Equity value = $127.5 million $197.2 million
Explanation:
a) Data and Calculations:
AAA Inc ZZZ Inc.
Annual earnings before interest and taxes $11.1 million $11.1 million
Annual interest (5% of $59 million) $2.95 million
Income taxes $0 $0
Annual dividends payments $8.15 million $11.1 million
Annual retained earnings $0 $0
Current market value of debts $59 million $0
Outstanding shares 1.7 million 3.4 million
Market price per share $75 $58
Equity value = (outstanding shares * market price)
= $127.5 million $197.2 million
(1.7 million * $75) (3.4 million * $58)
Total assets $186.5 million $197.2 million
Answer:
$15,000
Explanation:
Joe has sold the house he has been living in for 10 years to the Smiths family
He sold the house at $300,000
Joe receives $50,000 more than the original price bargained 10 years ago
He pays the real estate agent a commission of 5%
= 5/100
= 0.05
Therefore the increase in gross domestic product can be calculated as follows
= $300,000×0.05
= $15,000
Hence, the transaction will increase the gross domestic product by $15,000
