Answer:
The gain is subtracted from net income in the operating activities section
Explanation:
Given that
Sale value of an equipment = $230,000
And, the gain on the sale = $45,000
So by considering the above information
We can say that the Sale value of an equipment is shown in the investing activities as a cash inflow while the gain on the sale is to be subtracted from the net income in the operating activities and if there is a loss than it would be added to the net income
Answer:
See below
Explanation:
Given that,
Accounts receivables :
Beginning balance 1 September = $22,400
Services on account = $45,000
Cash collected = $34,400
Written off accounts = $2,000
Allowance for doubtful accounts:
Beginning balance 1 September = $4,400
Adjusted balance for Allowance for doubtful accounts on 30th September
= Beginning balance 1 September - Written off accounts + Bad debt expense
= $4,400 + $2,000 + ($45,000 × 8%)
= $4,400 + $2,000 + $3,600
= $6,000
Answer:
D.neither short- nor long term investment
Answer:
Greg’s capital gain on the apartment = $590,000
Explanation:
Purchase Cost = $100,000
Improvements = $300,000
Total Initial cost = Purchase Cost + Improvements
Total Initial cost = $100,000 + $300,000
Total Initial cost = $400,000
Depreciation for 20 Years = Depreciation per annum * 20
= $2,500 * 20
= $50,000
Net Book value after 20 Years = Initial cost - Depreciation for 20 Years
= $400,000 - $50,000
= $350,000
Capital Gain = Net Sale - Net Book Value
When Net Sale = Sale Price - Commission
= $1,000,000 - $ 60,000
= $940,000
Hence, Capital Gain = Net Sale - Net Book Value
Capital Gain = $940,000 - $350,000
Capital Gain = $590,000
Answer:
The entries are as follows
To record estimated returns on Sales
Debit: Sales Refund Payable Account $131,400
Credit: Accounts Receivables $131,400
To record estimated Cost of Sales returns
Debit: Inventory Returns Estimated Account $77,700
Credit: Inventory on Sales on Returns $77,700
Explanation:
To derive the figure for Sales Refund payable for the year
6% of $2,190,000
= 
= $131,400
To derive the figure for Inventory cost on Sales Refund payable for the year
6% of $1,295,000
= 
= $77,700
