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Elis [28]
2 years ago
6

Ratios that measure the income or operating success of a company for a given period of time are.

Business
1 answer:
RideAnS [48]2 years ago
8 0
A solvency ratio. It measures the income or operates success of an enterprise for a given period of time.
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Gillock, Inc. uses MACRS for its income tax return and the straight-line method for its financial statements. On January 1, Year
Sloan [31]

Answer:

A deferred tax liability will be reported on the balance sheet

b) trademark

as longterm assets refers to those assets that will not become cash within a one-year period

Explanation:

As the accounting makes the depreciaiton of the asset among 8 years

while the MACRS (depreciaiton for tax purposes) does it in 5 years

the company will pay lower income taxes now but, higher in the future

creating a tax liability as the tax relief occurs now.

Calculations:

Account Depreciation Expense

(cost - salvage value )/ useful life =

(130,000 - 10,000)/ 8 years = 8,000

Tax-purpose depreciation expense

130,000 x 20% = 26,000

There is a tax difference of (26,000 - 8,000) x corporate income tax

3 0
3 years ago
Suppose interest rates on residential mortgages of equal risk were 8% in california and 10% in new york. could this differential
Aleks04 [339]

Regional mortgage rate differentials do exist, depending on supply & demand conditions in the different regions. However, high rates in one region would attract capital from other regions, and the end result would be a diffferential that was just sufficient to cover the costs of causing the transfer. Differentials are more likely in the residential mortgage market than the business loan market, and not at all likely for the large, nationwide firms, which do their borrowing in the lowest-cost money centers thereby quickly equalizing rates for large corporate loans. Interest rates are more competitive, making it easier for small borrowers, and borrowers in rural areas, to obtain lower cost loans

4 0
3 years ago
On January 1, Year 1, McClurg Corporation issues 5%, 11-year bonds with a face amount of $70,000 for $76,180. The market interes
Mice21 [21]

Answer:

The journal entry for the issuance of the bond is shown below:

Explanation:

The entry to be posted on Jan 1

Cash A/c..............................................Dr   $76,180

    Premium on bonds payable A/c........Cr     $6,180

    Bonds Payable A/c..................................Cr   $70,000

As bonds issued, so cash is increasing and any increase in cash is debited. Therefore, the cash account is debited. But the bonds issued at a premium so the premium on the bonds payable will be credited. And bonds payable account is credited.

6 0
3 years ago
If a competitive firm is currently producing a level of output at which profit is not maximized, then it must be true that a. ma
kvv77 [185]

Answer:

a. Marginal revenue exceeds marginal cost.

Explanation:

<u>Note</u>: <u>The words "profit is not maximized" have been interpreted as, "the firm at current level of output earns profits, but not maximum profits it can earn." The answer provided herein is based upon this assumption.</u><u> </u>

Marginal revenue (MR) refers to the addition to total revenue when an additional unit of output is sold.

Similarly, marginal cost (MC) refers to the addition to total cost of production, when an additional unit is produced.

For an optimal level of production, and as a condition for profit maximization under perfect competition,

MR = MC and the marginal cost should increase post the level of output at which MR = MC.

If a competitive firm operates at a level wherein profits are not maximized, but the firm does earn profits, it indicates the stage of production wherein the marginal revenue exceeds the marginal cost.

Thus, as firm produces more and more units of output, it would reach a stage wherein marginal revenue would equal marginal costs and profits shall be maximized.

4 0
3 years ago
MV Corporation has debt with market value of $ 101 ​million, common equity with a book value of $ 100 ​million, and preferred st
timofeeve [1]

Answer:

Weight of debt = 0.2453 or 24.53%

Weight of preferred stock = 0.0486 or 4.86%

Weight of common equity = 0.7061 or 70.61%

Explanation:

The WACC or weighted average cost of capital is the cost of a firm's capital structure. The capital structure of a company can consist of one or more of the following components namely debt, preferred stock and common stock.

To calculate the WACC, we use the market value of each component.

  • The market value of debt is$101 million.
  • The market value of common equity is 290.7 million
  • The value of preferred stock is $20 million

Market value of common equity = 51 * 5.7 = 290.7 million

The weights to assigned to each components are,

Total weight of all components = 101 + 20 + 290.7 = 411.7 million

Weight of debt = 101 / 411.7  => 0.2453 or 24.53%

Weight of preferred stock = 20 / 411.7  => 0.0486 or 4.86%

Weight of common equity = 290.7 / 411.7  => 0.7061 or 70.61%

5 0
3 years ago
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