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On January 1st, 2019, Pizza Company awarded 5 million of its no par common shares to key personal. The award is subject to forfe

Allisa [31]

Answer:

A. Debit Compensation Expense $10,000,000

Credit PIC-Excess Par $10,000,000

Explanation:

The total cost of the stock options granted is allocated to the respective years in which the stock compensation relates as below:

Total stock compensation=market value per share on grant date*number of stock options

Total stock compensation=$10*5,000,000=$50,000,000

compensation expense allocated per year=$50,000,000/5

compensation expense per year=$10,000,000

6 0

3 years ago

Which of the following statements concerning internal controls is true? Multiple Choice Strong internal controls cannot be circu

GrogVix [38]

The True statement about internal controls is B. A system of internal controls is designed to prevent or detect errors and fraud.

Internal Controls are the techniques that an entity institutes to ensure the integrity of financial and accounting information, promote accountability of its employees, and prevent fraudulent activities.

Strong internal controls can still be circumvented. Internal controls are not limited to company policies and procedures against fraud. The employment of a husband and wife or close relations in the same company is not prohibited by control procedures or separation of duties.

Thus, the true statement about internal controls is B.

3 0

1 year ago

Two mutually exclusive projects have 3-year lives and a required rate of return of 10.5 percent. Project A costs $75,000 and has

Norma-Jean [14]

Answer:

Both projects should be rejected

Explanation:

The internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested.

IRR can be calculated using a financial calculator:

For project A,

Cash flow in year zero = $75,000

Cash flow in year one = $18,500

Cash flow in year two = $42,900

Cash flow in year three = $28,600

IRR = 9.12%

For project B,

Cash flow in year zero = $-72,000

Cash flow in year one = $22,000

Cash flow in year two = $38,000

Cash flow in year three = $26,500

IRR = 9.48%

The decision rule on if to invest or not is if IRR > r

For both investments IRR is less than rate of return

9.12% < 10.50%

9.48% < 10.50%

To find the IRR using a financial calacutor:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button, and the compute button.

I hope my answer helps you

8 0

3 years ago

John Daniel opened a medical practice in Sacramento, California, and had the following transactions during the month of January.

spayn [35]

Answer:

Explanation:

The journal entries are shown below:

1. Cash A/c Dr $34,000

To Common stock A/c $34,000

(Being the cash is received in exchange of common stock)

2. Medical supplied A/c Dr $17,000

To Account payable A/c $17,000

(Being the medical supplies are purchased on account)

3. Cash A/c Dr $1,600

To Service Revenue A/c $1,600

(Being the cash is received for service performed)

4. Office Rent Expenses A/c Dr $3,000

To Cash A/c $3,000

(Being the office rent expense is paid for cash)

5. Accounts Receivable A/c Dr $7,000

To Service revenue A/c $7,000

(Being the service revenue is recorded)

4 0

3 years ago

Because manufacturers with jit systems produce merchandise closer to the time of sale, they can

wlad13 [49]

These companies are able to reduce the inventories required to satisfy the demand of the retailers. With a JIT system, the company does not have to worry as much about waste product or overproducing, since the final item is being manufactured just before the deadline. This allows the company to run on a much tighter production schedule and lessens waste.

8 0

3 years ago

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