Answer:Net Income = $68,730 ; Operating cash flow=$181,730
Explanation:
Gross sales $865,000
Less:
Cost of good sold $455,000
selling Expenses $210,000
Total $200,000
Interest on notes $200,00 X 4% = 8,000
Depreciation $105,000
EBT $87,000
( $865,000- $455,000- $210,000- $8,000 - $105,000 )
less tax at 21% $18,270
(87,000 x 0.21)
Net Income $68,730
(87,000 - 18,270)
b) Operating cash flow = Net income + depreciation + interest
$68,730 + $105,000 + $8,000 =$181,730
Answer:
Assets should be recorded at cost basis. To determine cost basis we should determine the price that the company paid for the asset. If the only record about the purchase transaction is the note payable, then we can assume that the amount specified in the note payable is the purchase cost of the asset. The cost basis doesn't include any type of interest, but since the note doesn't specify any interest, then we can assume that there is no interest charged.
Answer:
D. Maximize (outputs - inputs)
Explanation:
The input is the raw material, labor, the efforts that is used in making the product while the output is the product or the result arising from the input
The profit arises when output and the input varies from each other
i.e
Profit = Output - input
In the case where there is neither an input nor output fixed, so we have to maximize the profit i.e (output - input) but the condition is that they are different from each other
Hence, the correct option is D.
Answer: $107,900
Explanation:
Cumulative Preferred Shares refer to shares that a company has to pay dividends eventually. This means that if they are unable to pay for some years, they are to accrue that payment until they are able to.
There are 119000 shares of no-par 6% preferred stock with a stated value of $5.
That means preferred shares are liable to the following amount of dividends,
= 119,000 * 5 * 6%
= $35,700
Preferred Shares have not being paid for the past 2 years and need to be paid in the current year as well. That means 3 payments,
= 35,700 * 3
= $107,100
Preferred Shares are to be paid $107,100 out of the $215,000 with the rest going to common shares.
Amount going to Common Shares is,
= 215,000 - 107,100
= $107,900
Common Stockholders are to receive $107,900
