Question (2)
ABC Company purchased equipment at a cost of $120,000 on January 1, 2018 that it expects to be useful for four years, and to have a residual value of $8,000. The Company uses the Double-declining balance method for depreciation.
Required: Compute the Depreciation expense for each of 2018 and 2019.
In: Finance
Cypress Corporation, a calendar year end corporation, has an AMT credit carryforward from 2017 in the amount of $43,000. In 2018, Cypress has $170,000 of taxable income. What is the amount of refund Cypress can expect to receive from its 2018 tax return filing?
In: Finance
Chipper, a calendar-year corporation, purchased new machinery for $1,135,000 in February 2018. In October, it purchased $2,105,000 of used machinery. What was Chipper’s maximum cost recovery deduction for 2018?
Question 1 options:
1) $1,243,621
2) $3,240,000
3) $1,038,114
4) $577,226
In: Accounting
Income Stmt info: 2018 2019
Sales $1,000,000 $1,050,000
less Cost of Goods Sold: 400,000 432,000
Gross Profit 600,000 618,000
Operating Expenses 350,000 365,750
Earnings before Interest & Taxes 250,000 252,250
Interest exp 20,000 20,400
earnings before Taxes 230,000 231,850
Taxes 69,000 69,555
Net Income $161,000 $162,295
Balance Sheet info: 12/31/2018 12/31/2019
Cash 25,000 $30,000
Accounts Receivable 50,000 $54,000
Inventory 125,000 $130,000
Total Current Assets $200,000 $214,000
Fixed Assets (Net) $300,000 $318,000
Total Assets $500,000 $532,000
Current Liabilities $110,000 $119,900
Long Term Liabilities $180,000 $175,000
Total Liabilities $290,000 $294,900
Stockholder's Equity $210,000 $237,100
Total Liab & Equity: $500,000 $532,000
Compute each of the following ratios for 2018 and 2019 and indicate whether each ratio was getting "better" or "worse" from 2018 to 2019 and was "good" or "bad" compared to the Industry Avg in 2019 (round all numbers to 2 digits past the decimal place)
2018 2019 Getting Better or Getting Worse? 2019 Industry Avg "Good" or "Bad" compared to Industry Avg
Profit Margin 0.11
Current Ratio 1.90
Quick Ratio 0.66
Return on Assets .28
Debt to Assets .50
Receivables turnover 18.00
Avg. collection period* 15.50
Inventory Turnover** 9.25
Return on Equity 0.55
Times Interest Earned 13.20
*Assume a 360 day year **Inventory Turnover can be computed 2 different ways. Use the formula listed in the text (the one the text indicates many credit reporting agencies generally use)
In: Finance
Analyze the industry environment of Walmart in 2018
In: Operations Management
Depreciation Calculation: Depre. Exp. = cost – salvage value* (time in service)
useful life
2018 Depreciation: $20,000-2000*(6/12) = $1,800
5 years
2019 Depreciation:
2020 Depreciation:
2021 Depreciation:
2022 Depreciation:
2023 Depreciation:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/18 |
Depreciation Expense - Truck |
$1,800 |
|
|
Accumulated Deprec. - Truck |
$1,800 |
The journal entry to record the Depreciation Expense for Year 2 is:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/19 |
|||
The journal entry to record the Depreciation Expense for Year 3 is:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/20 |
|||
The journal entry to record the Depreciation Expense for Year 4 is:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/21 |
|||
The journal entry to record the Depreciation Expense for Year 5 is:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/22 |
|||
The journal entry to record the Depreciation Expense for the last year is:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/23 |
|||
Double Declining Depreciation Calculation:
Double Declining Rate= _____1_______* (2)
useful life
Depre. Exp. = Beginning of the Year Book Value * (Double Declining Rate) * (time in service)
|
Year |
Beg. Of Year Book Value* |
Depre. Rate * |
Time in Service= |
Depre. Exp. |
Accum. Depre. |
Ending Book Value |
|
(from prior year ending) |
(calculate ¼) |
(use months) |
(compute) |
(add prior Depre. exp.) |
(cost- accum. depre.) |
|
|
a |
b |
c |
a*b*c = d |
e |
(cost-e) = f |
|
|
2018 |
$20,000 |
40% |
(6/12) |
$4,000 |
$4,000 |
$16,000 |
|
2019 |
||||||
|
2020 |
||||||
|
2021 |
||||||
|
2022 |
||||||
|
2023 |
|
Date |
Accounts |
Debit |
Credit |
|
12/31/18 |
Depreciation Expense - Truck |
$4,000 |
|
|
Accumulated Deprec. - Truck |
$4,000 |
The journal entry to record the Depreciation Expense for Year 2 is:
|
Date |
Accounts |
Debit |
Credit |
|
12/31/19 |
|||
In: Accounting
An individual who has automobile insurance from a certain company is randomly selected. Let Y be the number of moving violations for which the individual was cited during the last 3 years. The pmf of Y is given.
| y | 0 | 1 | 2 | 3 |
|---|---|---|---|---|
|
p(y) |
0.50 | 0.30 | 0.15 | 0.05 |
(a)
What is the probability that among 15 randomly chosen such individuals, at least 10 have no citations? (Round your answer to three decimal places.)
(b)
What is the probability that among 15 randomly chosen such individuals, fewer than half have at least one citation? (Round your answer to three decimal places.)
(c)
What is the probability that among 15 randomly chosen such individuals, the number that have at least one citation is between 5 and 10, inclusive? ("Between a and b, inclusive" is equivalent to
(a ≤ X ≤ b).
Round your answer to three decimal places.)
In: Statistics and Probability
Monitoring the Cost Of Money: Interest Rates
Interest rates, the cost of money, influence most all factors related to personal and corporate capital budgeting. The more obvious personal information for the cost of money is the rates associated with a mortgage or car loan. As a CFO you would “shop” interest rates to find the best rate for your financing needs.
1. Would you, as the CFO, finance your projects as soon as possible if the cost of capital was expected to drop? Please explain.
2. More importantly, where do you find the information to analyze expected changes in interest rates?
3. Please list references and in-text citations.
4. PLEASE LOOK AT YOUR GRAMMER WHEN YOU ARE WRITING. MAKE SURE YOU HAVE COMPLETE SENTENCES SO THAT I CAN READ IT AND LIST REFERENCES PLEASE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
In: Finance