Net Income flows from the income statement to the statement of retained earnings.
The balance sheet is balanced when net income from the income statement, less any dividends paid, is transferred to the retained earnings column. Additional connections- Long-term debt on the balance sheet is used to determine interest expenditure on the income statement.
Net income: In commerce, Net Income is the amount of cash left over on balance costs, like salaries and wages, the value of commodities or raw materials, and taxes, are paid. Net Profit is the amount that an individual keeps after paying taxes, insurance premiums, and retirement contributions.
Net Income.
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Answer:
Instructions are listed below.
Explanation:
Giving the following information:
A machine costing $251,800 was purchased May 1. The machine should be obsolete after three years and, therefore, no longer useful to the company. The estimated salvage value is $3,400.
A) Straight-line:
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (251,800 - 3,400)/3= $82,800
B) Double declining balance:
Annual depreciation= 2*[(original cost - residual value)/estimated life (years)]
Year 1= (248,400/3)*2= 165,600
Year 2= 55,200
Year 3= 18,400
Answer:
The correct answer is Option A.
Explanation:
The effective interest rate (EIR) method is used when a bond is purchased at a discount or premium.
In the case of the question, the bond was purchased at $9,631 with a face value of $10,000. Interest expense is calculated as the bond price multiplied by the market rate, i.e. $9,631 x 11% = $1,059.41.
Therefore, ABC Company would record $1,059 on the first annual interest payment date using the effective-interest method.
If the total production exceeds the total expenditures this means that there are more goods are produced than the demand of each households. Thus, this will lead to an increase of inventory. Then this will signal the manufacturing firm that they have overproduced the goods which will lead to cut back the production. This leads to lesser prices and/or unsold goods alongside with the likelihood of unemployment. Therefore the answer is d.
