Other things equal, a 10 percent decrease in corporate income taxes will

On March 3, Sunland Company sells $768,600 of its receivables to Western Factors Inc. Western Factors Inc. assesses a service ch

Sedaia [141]

Answer: The journals to record the sale of the receivables in Sunland Company's books are:

Debit Credit

Cash 729,600

Service charge expense 38,400

Accounts receivable 768,000

Explanation: Please note that Western Factors Inc. charges 5% of the amount of receivables sold. This means the cash transfer Sunland Company would make to western Factors Inc. would be net of the 5% service charge (5% * $768,000 = $38,400). Since Sunland is disposing the receivables, that account has to be credited. Then, the actual cash transfer would be $729,600 ($768,000 - 38,400). That is what Western Factors Inc. would now carry as its own receivables in its books.

7 0

3 years ago

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Hot Products owns a patent for a fan motor that it uses in ceiling fans. Allied Electric uses a fan motor that is identical to H

noname [10]

Answer:

The answer is: YES

Explanation:

Hot Products is the legitimate owner of the patent for the manufacturing and commercialization of that fan motor. If Allied Electric wants to produce and use that specific fan motor they must come to a manufacturing licence agreement with Hot Products even thought the fan motor is used differently (one in ceiling fans and the other in air conditioners).

4 0

4 years ago

When the allowance method is used for bad debts, the entry to write off an individual account known to be uncollectible involves

Evgen [1.6K]

Answer:

debit to the Allowance account.

Explanation:

GAAP is an acronym for Generally Accepted Accounting Principles, it comprises of the accounting standard, procedures and principles used by public institutions in the United States of America. The U.S GAAP is issued by the Financial Accounting Standards Board (FASB) and adopted by the U.S. Securities and Exchange Commission (SEC).

IFRS is an acronym for International Financial Reporting Standards, it comprises of a set of accounting standards or rules issued by the International Accounting Standards Board (IASB). The International Financial Reporting Standards ensures that statement of income, when reported by accountants is consistent, transparent and comparable globally.

According to the Generally Accepted Accounting Principles (GAAP), when the allowance method is used for bad debts, the entry to write off an individual account known to be uncollectible involves a debit to the allowance account.

3 0

3 years ago

The Balance Sheets at the end of each of the first two years of operations indicate the following: 2006 2005 Total current asset

alexandr402 [8]

Answer:

Return on Assets (2006) = 7.60 %

Explanation:

Return on Assets = Earnings Before Interest and Tax ÷ Total Assets

Therefore,

Return on Assets (2006) = ($115,000 + $30,000) / ( $600,000 + $60,000 + $900,000) × 100

= $118,000 / $1,560,000 × 100

= 7.60 % (one decimal place)

5 0

3 years ago

Pearl, Inc. has prepared the operating budget for the first quarter of the year. The company forecast sales of $ 40 comma 000 i

notka56 [123]

Answer:

The correct answer is A.

Explanation:

Giving the following information:

The company forecast sales:

January= $40,000

Variable and fixed selling and administrative expenses are as follows:

Variable Expenses:

Power cost (30% of sales)

Miscellaneous expenses: (5% of sales)

Fixed Expenses:

Salaries expense= $10,000 per month

Rent expense: $5,000 per month

Depreciation expense: $1,200 per month

Power cost/fixed portion: $800 per month

Miscellaneous expenses/fixed portion: $1,200 per month

Total= $18,200

For January

Total variable cost= 40,000*0.3 + 40,000*0.05= $14,000

Total fixed cost= 18,200

Total cost= $32,200

6 0

4 years ago

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