Answer:
The correct option is A,Debit Land and Building, $130,000; Credit Common Stock, $5,000; Credit Paid-in Capital in Excess of Par Value, Common Stock, $125,000.
Explanation:
The sum of the two market values of both land and building is $130,000($100,000+$30,000),which would be debited to land and building account to show that the asset has increased due to new acquisition.
In the common stock account the par value of the shares which is $5,000($1*5000) would be credited to it.
The difference between the market value of assets acquired and the common stock amount which is $125,000($130,000-$5,000) would be credited to paid in capital in excess of par account.
Answer:
B)
Explanation:
Makes the most sense considering the scenario.
A manufacturer would need to find the production quantity where the marginal rate of return equals marginal costs (this is called the equilibrium point). This would be the point where profits are maximized.
Answer:
Option (b) is correct.
Explanation:
Given that,
Income from operations = $400,000
Total service department charges = $200,000
The income from operations already takes into account the service department charges which means that it is already deducted. Hence, if we add the total service department charges to the income from operations then we can get the income from operations before service department charges.
So, the income from operations before service department charges is as follows:
= Income from operations + Total service department charges
= $400,000 + $200,000
= $600,000
