Answer: $300,000
Explanation:
Total expected costs = cost incurred to date + estimated cost to complete
= 1,200,000 + 3,600,000
= 4,800,000
= 0.25
= 25%
Profit = contract revenue - Total expected costs
= $6,000,000 - 4,800,000
= $1,200,000
Cumulative gross profit = Profit × Percentage of completion
= $1,200,000 × 0.25
= $300,000
Therefore, Red Builders should have recognized profit at the end of year 1 in the amount of $300,000.
Answer:
$24,550
Explanation:
Computation for the estimated cost of the ending inventory
Net Sales = $415,000
Gross Profit rate= 37%
Cost of goods Sold = 100%- 37% = 63%
Cost of Goods Sold =$415,000*63% = $261,450
Cost of Goods Available for sale = $286,000
Using this formula
Estimated Cost of Ending Inventory= Cost of goods available for sale - Cost of Goods Sold
Let plug in the formula
Estimated Cost of Ending Inventory = $286,000-$261,450
Estimated Cost of Ending Inventory = $24,550
Therefore the estimated cost of the ending inventory is $24,550
Answer:
$52.91
Explanation:
With regards to the above, we will apply the dividend discount model to come up with the price for share.
Under the dividend discount model, the price for share represents the present value of all its future dividend discounted at the required rate of return.
Since the share has 12 annual equal dividend payments of 8.15 each year, while the required rate is 11%, we can apply the below annuity to arrive at the share price.
(8.15/0.11) × [ 1- 1.11^(-12) ] = $52.91
Therefore, the current share price is $52.91
