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2 years ago

Which of the following statements is false?

Business

1 answer:

ella [17]2 years ago

3 0

Answer: D

Explanation:

Not necessarily. As long as the company follows GAAP (IFRS or ASPE), the format and information should be the same. This is because the accounting standards requires firm to report financial information in a specific way.

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The following information pertains to Sampson Company. Assume that all balance sheet amounts represent both average and ending b

Paha777 [63]

Answer:

Sampson Company

The inventory turnover for Sampson is:

5 times.

Explanation:

a) Data and Calculations:

Assets

Cash and short-term investments $ 45,000

Accounts receivable (net) 25,000

Inventory 11,000

Property, plant and equipment 210,000

Total Assets $291,000

Liabilities and Stockholders' Equity

Current liabilities $ 50,000

Long-term liabilities 90,000

Stockholders' equity—common 151,000

Total Liabilities and Stockholders' Equity $291,000

Income Statement Sales $ 120,000

Cost of goods sold 55,000

Gross profit 65,000

Operating expenses 30,000

Net income $ 35,000

Number of shares of common stock 6,000

Market price of common stock $20

Dividends per share $0.50

Inventory Turnover = Cost of goods sold/Average Inventory

= $55,000/$11,000

= 5 times

3 0

3 years ago

When monopolistically competitive firms advertise, in the long run they will still earn zero economic profit. they can earn posi

Daniel [21]

Answer:

When monopolistically competitive firms advertise, in the long run they will still earn zero economic profit.

Explanation:

Monopolistic competition happens when many producers sell products that are differentiated from one another and hence are not perfect substitutes

Based on this, the demand curve of a firm in a monopolistic competitive market will shift so that it is tangent to the firm's average total cost curve and this will make it impossible for the firm to make economic profit. The best that can be expected is to be able to break even

This means in the long run, a monopolistically competitive firm will make zero economic profit.

A good example is Hotel which can only raise its prices without losing all of its customers based on brand loyalty and distinct quality differentiation.

8 0

4 years ago

Read 2 more answers

Item 3Item 3 Cutter Enterprises purchased equipment for $87,000 on January 1, 2018. The equipment is expected to have a five-yea

Rus_ich [418]

Answer:

$27,400 and $59,600

Explanation:

The computation of the depreciation expense and the book value using the sum of-the-years'-digits method is shown below:

Depreciation expense is

= (Purchase cost - residual value) × useful life ÷ sum of years

= ($87,000 - $4,800) × 5 years ÷ (5 + 4 + 3 + 2 + 1)

= $27,400

And, the book value is

= Purchase cost - depreciation expense

= $87,000 - $27,400

= $59,600

8 0

3 years ago

Bachrodt Corporation uses activity-based costing to compute product margins. Overhead costs have already been allocated to the c

marusya05 [52]

Answer:

Product margin= $4,728

Explanation:

Giving the following information:

Processing $ 21,600

Supervising $ 3,700

MHs (Processing) Batches (Supervising)

Product Y7 3,700 400

Product V0 6,300 600

Total 10,000 1,000

First, we need to calculate the estimated overhead rate for each activity:

Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base

Pocessing= 21,600/10,000= $2.16 per machine hour

Supervising= 3,700/1,000= $3.7 per batch

Now, we can allocate overhead to product Y7:

Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base

Pocessing= 2.16*3,700= $7,992

Supervising=3.7*400= $1,480

Total= $9,472

Finally, we can determine the product margin:

Product Y7:

Sales (total)= 102,200

Direct materials= (40,800)

Direct labor= (47,200)

Allocated overhead= (9,472)

Product margin= $4,728

6 0

3 years ago

During the second year of the equipment’s life, $21,900 cash is paid for a new component expected to increase the equipment’s pr

Alona [7]

Answer:

S/N ACCOUNT DEBIT CREDIT

1 Equipment $22,000

Cash $22,000

Being payment for new component expected to increase the

equipment’s productivity by 10% a year

2. Equipment Repairs expenses $6,250

Cash $6,250

Being payment for equipment repair

3. Equipment $14,870

Cash $14,870

Being payment for equipment repair to prolong the useful life

the asset

Explanation:

The initial cost incurred in acquiring an asset is debited to asset account, subsequently every other cost spent on the assets are either expenses against the earning of that period or expensed over many years over the useful life of the asset.

Capitalization is the recognition of an expense as an asset in the balance sheet rather than expenses in the income statement.

The payment of $22,000 paid for the equipment productivity must be capitalized, that is added to the cost of the asset because it is a cost that is expected to increase the equipment’s productivity by 10% a year.

The $6,250 paid for normal repair is a revenue items which is to be expensed against the earning of that period.

The $14,870 paid for repairs which will increase the useful life of the equipment from four to five years is a capital expenditure which should capitalized, that is added to the cost of the asset.

7 0

4 years ago