Answer:
$926,073
Explanation:
Enterprise value=market capitalization+value of debt-cash
value of the firm=price-earnings ratio=11.8
earnings=net income
net income=profit margin*sales
net income=$697,000*6.8%=$47,396
11.8=market capitalization/$47,396
market capitalzation=11.8*$47,396=$559,272.80
enterprise value=$559,272.80+$408,000-$41,200=$ 926,072.80 (approx $926,073)
Answer:
stockholer's equity will be overstated by $800.
Explanation:
The adjustment required is to record $800 of supplies used as an expense, hence, by carrying out the adjustment, net income is overstated by $800 so also retained earnings and shareholders' equity.
In other words,the balance that would be left in supplies is opening balance of $200 plus purchase of supplies which is $950 minus the supplies used.
balance of supplies=$200+$950-$800=$350
Option B is wrong the balance expected is $350 and the balance without adjustment is $200,that is $150 understatement not $350
Answer:
- <u>The numbrer of performance obligations is equal to the number of new subscribers.</u>
<u></u>
Explanation:
Each <em>new subscriber </em>generates a<em> performance obligation</em>, as the automotive magazine provides a coupon to each new subscriber, and each coupon is a promise to provide the discount.
A perfomance obligation is a contractual promise to provide a “distinct” good or service to a customer" (taken from the internet).
Whether or not the an obligation will be recognized or not will depend on whether the subscriber uses the coupon or not, but that does not depend on the will of the automotive magazine: they are obliged to provide the discount to every subsriber that uses the coupon (within the terms of the contract).
Thus, since each coupon is a contract, each one is a performance obligation.
