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andrezito [222]
2 years ago
13

Henry Co. manufactures DVD players. At the end of Year 1, Henry's management believes the growing popularity of streaming video

content will reduce the demand for Henry's DVD players. The DVD players are manufactured using specialized equipment with a historical cost of $3,000,000 and accumulated depreciation of $1,520,000. The managers estimate the equipment has a remaining useful life of 4 years and will generate the following undiscounted cash flows:
Year 2 $ 540,000

Year 3 420,000

Year 4 190,000

Year 5 125,000

Salvage value 50,000

If the equipment were sold today, the sales price would be $1,600,000. Is the equipment considered impaired, why or why not?

Not impaired because the fair value of the equipment is greater than the carrying value of the asset by $120,000.

Yes impaired because undiscounted cash flow are lower than the carrying amount of the asset by $155,000.

Cannot determine impairment without discounted cash flows.

Yes impaired because the undiscounted cash flows are less than the fair value of the equipment by $275,000.
Business
2 answers:
zysi [14]2 years ago
6 0

Answer:

Not impaired because the fair value of the equipment is greater than the carrying value of the asset by $120,000.

Explanation:

Impairment will happen if carrying amount is greater than the fair value of the assets, here the carrying value of the assets is 1,480,000, which is lessor than the fair value of the assets 1,600,000 by 120,000. Hence impairment will not happen so 1st option is correct.

Katarina [22]2 years ago
4 0

Answer:

Not impaired because the fair value of the equipment is greater than the carrying value of the asset by $120,000.

Explanation:

Impairment will occur if conveying sum is more noteworthy than the reasonable estimation of the benefits, here the conveying estimation of the advantages is 1,480,000, which is lessor than the reasonable estimation of the benefits 1,600,000 by 120,000. Henceforth impairment won't occur.

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The GoT cups are a fast seller and you need to ensure that you have enough rolls of paper to fulfill demand. The first stage in
jarptica [38.1K]

Answer:

EOQ = 414 rolls

Explanation:

In order to calculate the number of orders to minimize the cost, we should calculate that by using the Economic order quantity model.

DATA

Holding cost = $1.75/unit

Annual demand = 500 rolls x 12 = 6000 rolls

Ordering cost = $25

Formula

EOQ =\sqrt{\frac{2Cod}{Ch} }

Where

Co = ordering cost

D = Annual demand

Ch = Holding cost

Solution

EOQ = \sqrt{\frac{2(6000)(25)}{1.75} }

EOQ = \sqrt{\frac{300000}{1.75} }

EOQ = 414 rolls

They should order 414 rolls to minimize the cost.

4 0
2 years ago
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You have received a share of preferred stock that pays an annual dividend of $10. Similar preferred stock issues are yielding 22
Blizzard [7]

Answer:

The value of this share of preferred stock is $44.44

Explanation:

Dividend = $10

Yield= 22.5% = 0.225

Value of share of preferred stock = Dividend / Preferred stock yield

=$10/0.2250

=$44.44444

=$44.44

6 0
2 years ago
On January 12, JumpStart purchased $870 in office supplies. (a) Journalize the transaction as if JumpStart paid cash. Jan. 12 (b
Mumz [18]

Answer:

Part a : If JumpStart paid cash

Office Supplies $870 (debit)

Cash $870 (credit)

Part b : If JumpStart placed it on account

Office Supplies $870 (debit)

Account Payable $870 (credit)

Part c : If JumpStart pays the amount due

Account Payable $870 (debit)

Cash $870 (credit)

Explanation:

Part a : If JumpStart paid cash

Recognise an expense for Office Supplies and reduce the assets of cash to reflect outflow of economic benefits in form of cash

Part b : If JumpStart placed it on account

Recognize an expense for Office Supplies and also recognise a Liability - Accounts Payable to reflect a present obligation created by JumpStart to its Supplier

Part c : If JumpStart pays the amount due

Derecognise the Liability - Accounts receivable since the liability has been settled and reduce the assets of cash to reflect outflow of economic benefits in form of cash due to settlement of Account

6 0
2 years ago
Once you have collected data for a message, you’ll need to find a way to organize it. Well-organized messages group similar idea
shutvik [7]

Answer:

c. Sparkling water, evening wine tasting, four-star hotel restaurant

Explanation:

The scratch list in general includes a series of services that are provided by a Hotel (the Boston Hotel). Because of the items included in the list, it seems that the Hotel is quite fancy.

Numeral c would be a good addition to the scratch list, because it lists items that would fall in place for the type of Hotel being described: sparking water, evening wine tasting, and a the mention of a four-star hotel restaurant.

5 0
2 years ago
Waldron inc. is considering selling to a group of new customers that will bring in credit sales of $24,000 with a return on sale
Andrew [12]

Answer:

30%

Explanation:

The computation of return on investment is shown below:-

Return on Sales = Credit sales ×  Return on sales

= $24,000 × 5%

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Investment in Accounts Receivable

= $24,000 ×  1 ÷ 6

= $4,000

Return on Investment = Return on Sales ÷  Investment in Accounts Receivable  × 100

= $1,200 ÷ $4,000  × 100

= 30%

Therefore for computing the return on investment we simply divide the investment in account receivable by return on sales.

6 0
2 years ago
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