Answer:
A. The investment decreases by $771,000
Explanation:
As per the question the following details are given below :-
Net loss = $2,500,000
Total Dividend = $70,000
Owning Percentage = 30%
The computation of during the year is given below:-
Net loss + Total Dividend x Owning Percentage
= ($2,500,000 + $70,000) x 30%
= $2,570,000 x 30%
= $771,000
So, the Magnus investment in Mirika inc. reduces by $771,000
Answer:
a. According to the company's accounting system, what is the net operating income earned by product D14E? (Net losses should be indicated by a minus sign.)
b. What would be the financial advantage (disadvantage) of dropping product D14E? Should the product be dropped?
- financial disadvantage of discontinuing the produce is -$68,000, so the company should not discontinue the product since its losses would increase
Explanation:
total sales $670,000
- variable expenses $295,000
- fixed manufacturing expenses $246,000
- fixed selling and administrative expenses $194,000
net loss = $65,000
if product D14E is discontinued, $196,000 + $111,000 = $307,000, of fixed expenses can be avoided, but $133,000 are not avoidable. if the company discontinues the product, its losses will increase by $133,000 - $65,000 = $68,000
Answer:
Dr interest expense $7,000
Dr notes payable $7,238
Cr cash $14,238
Explanation:
The first task is to compute interest expense on the loan in year 1 which is shown below:
interest expense=$100,000*7%
interest expense=$7,000
Principal repayment=repayment-interest repayment
Principal repayment=$14,238-$7,000=$7,238
The double entries are to debit interest expense and notes payable with $7,000 and $7,238 respectively while cash is credited with $14,238 as an outflow of cash.
Answer:
A. Wide span of management control and flat organizational height
Explanation:
Span of management is defined as number of subordinates that a manger can control efficiently. In case of George Brown, the regional sales manager which takes care of the sales person throughout the region has wide span of management. Also, the organization is a flatter organization as the numbers of managerial posts are less and the span is large.
Thus, the correct option is (a) wide span of management control and flat organizational height.
