Answer: The correct answer is "B, C, and D".
Explanation: All of these are corrects statements regarding the direct write-off method for calculating bad debt expense.
- This method is generally not consistent with GAAP and accrual accounting.
- Using this method generally causes an over estimate of accounts receivable in the company's balance sheet.
- One of the peculiarities of this method is that it only recognizes the expense for bad debts when a specific account is determined uncollectible.
Answer:
$44,800
Explanation:
For computation of capital balance we need to find out first total capital, shares, gain and Orton shares which is shown below:-
Total capital = $60,000 + $40,000 + $20,000
= $120,000
Shares = Total capital × Interest rate
= $120,000 × 0.10
= 12,000
Gain = Investment - Shares
= $20,000 - $12,000
= $8,000
Orton Shares = Gain × 3 ÷ 5
= $8,000 × 3 ÷ 5
= $4,800
Capital = Given capital balance + Orton Shares
= $40,000 + $4.800
= $44,800
So, We have applied the above formula.
Answer:
Option A is correct one.
Competing
Explanation:
When one person seeks to satisfy his or her own interests regardless of the impact on the other parties to the conflict, that person is using the conflict-handling intention of <u>Competing.</u>
When one person seeks to satisfy his or her interests regardless of the impact on the other parties to the conflict, he is competing. The competition involves authoritative and assertive behaviours.
Answer:
A) Gift loans of $14,000 in which interest foregone is in the form of a gift.
Explanation:
You are free to give anyone any type of gift that is worth up to $14,000, this includes gifts in cash, assets (e.g. car) or gift loans. Any gift above that threshold will result in taxes paid by the person that receives the gift.
The IRS defines gift loans under Section 7872(f)(3) as:
<em>“The term “gift loan” is any below-market loan where the forgoing of interest is in the nature of a gift.”</em>
As long as the forgone interest doesn't exceed $14,000, then no taxes should be paid.
Answer:
You should pay $3.86 to purchase this stock.
Explanation:
Hi, first let me mention that we can find the price of a stock by bringing to present value its future cash flows, in this case, its dividends, therefore we need to bring to present value $0.25 of year 3 and $0.25 of year 4. We also have to bring that constant dividend of $0.75 that the company plans to pay indefinitely, that we can do by using the following formula, discounted at 13%.
Notice that the formula above says PV(4), that is because this formula only brings that perpetual annuity to one period of time before the first payment takes place, therefore this value has to be brought to present value too.
With all the considerations above, this is how everything should look like.
Therefore, the price of this stock is $3.86
Best of luck.
