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Furkat [3]
2 years ago
12

On January 2, 2022, McClelland Company purchased a machine and signed a noninterest-bearing note in payment. The note matures in

4 years and requires McClelland to pay $70,000 at maturity. McClelland also had the option to purchase the the machine in cash from a different vendor for $56,505. At what amount should the machine be recorded upon purchase
Business
1 answer:
tresset_1 [31]2 years ago
6 0

The amount that McClelland Company should record the machine upon purchase is<u> $56,505.</u>

<h3>Recording the transaction</h3>

The proper way to record the transaction based on U.S. GAAP polices is to debit the Machine account with the price of $56,505 as this represents the market value of the machine.

The company should also credit the Notes payable account with $70,000 being the value of the note acquired. A debit will go to the Discount on Note account for $13,495 which is the difference between the note and value of machine.

Find out more on recording Notes Payable at brainly.com/question/17073934.

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Solution:

Single factory overhead amount: the amount at which plant overheads or processing overheads are assigned to goods is referred to as single plant overhead rate.

Formula to measure a single plant-wide overhead rate:

Single plant-wide overhead rate :

\frac{Total budgeted factory overhead}{ Total budgeted plant-wide allocation base}  

Different development team overhead rate: this distribution system describes the various divisions engaged in the manufacturing cycle. Factory overheads are assigned to goods on the basis of the overhead cost for each of the manufacturing units.

Formula for calculating various output department overhead:

Multiple production department overhead rate:

\frac{ Budgeted department factory overhead}{ Budgeted department factory overhead}

For calculate: single plant-wide overhead rate use direct working hours (DLH) as the allocation basis, and measure factory overhead.

Using DLH as the allocation basis to measure a single plant-wide overhead limit.

Single plant-wide overhead rate :  \frac{Total budgeted factory overhead}{ Total budgeted plant-wide allocation base}

                                                     = \frac{80,000}{10,000 DLH}

For calculate: single plant-wide overhead rate use direct working hours (DLH) as the allocation basis, and measure factory overhead.

Using DLH as the allocation basis to measure a single plant-wide overhead limit.

4 0
3 years ago
When the present value of the cash inflows exceeds the initial cost of a project, then the project should be: accepted because t
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3 years ago
If a new home can be constructed for $150,000, what is the opportunity cost of federal defense spending, measured in terms of pr
FrozenT [24]

Answer:

4 million  houses

Explanation:

Opportunity cost is the forfeited benefit as a result of choosing one option over others.  Its value equals the cost of the next best alternative.

The cost of constructing a new home is $150,000.  If the Federal Defence has a budget of $600 billion, the opportunity cost of spending that amount will be the equivalent number of units that can be built by the amount.

To calculate the number of units= $600 billion divided by $150,000

= $600,000,000,000/ $150,000

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4 years ago
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3 years ago
Which of the following is not a liquid investment
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