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notsponge [240]
3 years ago
10

Bridge City Consulting bought a building and the land on which it is located for $175,000 cash. The land is estimated to represe

nt 70 percent of the purchase price. The company paid $20,000 for building renovations before it was ready for use. Compute straight-line depreciation on the building at the end of one year, assuming an estimated 10-year useful life and a $19,500 estimated residual value. (Do not round intermediate calculations.) What should be the book value of (a) the land and (b) the building at the end of year 2
Business
1 answer:
Darya [45]3 years ago
5 0

Answer:

Part 1

D.E = $5,300

Part 2

a. Book Value = $61,900

b. Book Value = $122,500

Explanation:

Step 1 : Determine the Cost of Buildings

<em>Separate the Cost of Land and the Cost of Building from the Purchase Price</em>

<u>Calculation of the Cost of Building</u>

Purchase Price ($175,000 x 30%)   $52,500

Building Renovations                      $20,000

Total                                                  $72,500

Step 2 : Depreciation calculation

<em>Depreciation expense = (Cost - Residual Value) ÷ Useful Life</em>

                                      = ($72,500 - $19,500) ÷ 10

                                      = $5,300

After Year 2

<u>Buildings :</u>

Accumulated Depreciation = $10,600

Book Value = $72,500 - $10,600 = $61,900

<u>Land </u>

Book Value = $175,000 x 70% = $122,500

Note : Land is not depreciated

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The Federal Reserve is responsible for monitoring the money supply and the general stability and safety of u. s. banking system.

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The Federal Reserve promotes the safety and soundness of individual financial institutions and oversees their impact on the financial system as a whole.

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8 0
1 year ago
On March 15, Summit Hawk declares a quarterly cash dividend of $0.085 per share payable on April 13 to all stockholders of recor
Sedaia [141]

The journal entries to  Summit Hawk's declaration and payment of cash dividends is: Debit Dividend  $18,530,000; Credit  Dividend payable   $18,530,000

<h3>Journal entries</h3>

March 15

Debit Dividend  $18,530,000

(218,000,000 shares × $0.085)

Credit  Dividend payable   $18,530,000

(To record cash dividend declaration)  

March 30

No entry

April 13

Debit Dividend payable     $18,530,000

(218,000,000 shares × $0.085)

Credit  Cash     $18,530,000

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Therefore the journal entries to  Summit Hawk's declaration and payment of cash dividends is: Debit Dividend  $18,530,000; Credit  Dividend payable   $18,530,000.

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6 0
2 years ago
During 2018, Deluxe Leather Goods issued 728,000 coupons which entitles the customer to a $4.30 cash refund when the coupon is s
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Answer:

$1,051,780

Explanation:

The computation of the  liability for unredeemed coupons is shown below:

= (Number of coupons issued × estimated percentage - processed coupons) × coupon worth

= (728,000 coupons × 70% - 265,000 coupons) × $4.30

= 244,600 coupons × $4.30

= $1,051,780

Simply first we determined the number of unredeemed coupons and then multiplied it by the coupon worth

7 0
3 years ago
The pizza industry is perfectly competitive and has​ 1,000 firms.All firms are identical.In​ long-run equilibrium, each firm is​
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Answer:

A) making zero economic profit

Explanation:

A perfectly competitive industry is where there are many firms producing homogenous goods and services. There are no barriers to entry or exit of firms. Prices are set by market forces. Buyers and sellers are price takers.

In the short run, if firms in a perfectly competitive market are earning economic profits, in the long run, new firms enter into the industry and economic profit falls to zero.

In the short run, if firms in a perfectly competitive market are earning economic loss, in the long run, firms leave the industry and economic profit goes up to zero.

I hope my answer helps you

3 0
3 years ago
Assume you will invest $100 per month in an investment earning 11% per year (assume monthly compounding). After 10 years, you st
Rina8888 [55]

Answer:

The amount at the end of 30 years is $174,952.

Explanation:

In this problem we first need to determine the future value after making A = $100 investment for n = 10 years at r = 11% per year compounded monthly.

Then we need to compute the compound interest on this future value for 20 years at 11% interest compounded annually.

The future value formula is:

FV=A\times [\frac{(1+r)^{n}-1}{r}]

The amount is compounded monthly.

The rate of interest per month is:

r=\frac{11}{12}\%= 0.9167\%

The number of periods is: <em>n</em> = 10 × 12 = 120 months.

Determine the future value as follows:

FV=100\times [\frac{(1+0.009167)^{120}-1}{0.009167}]=21700

Thus, the amount at the end of 10 years is $21700.

Now this amount is kept the account for t = 20 years and earns an interest at the rate of 11% compounded annually.

Amount at the end of 30 years = FV(1+r)^{t}

                                                    =21700\times(1+0.11)^{20}\\=174952

Thus, the amount at the end of 30 years is $174,952.

6 0
3 years ago
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