The machine's net present value is $3,481. The net present value is a method of calculating the present value of return of an investment either in capital purchases or projects. The net present value amount is acquired by subtracting the $ 37,000 initial investment from the net present value of $12,000 net cash flow for four years plus the present value of $1000 salvage value at the end of the 4th year.
Net Present Value = Present value of net cash flow + Present value of salvage value - Initial investment
$3,481 = $39,746 + $735 - $37,000
Answer:
<u>$215,000</u>
<u> $112,500,</u>
<u>gain,</u>
<u>$102,500</u>
Explanation:
Darla's <em>amount realized on the sale</em> is calculated by adding the dollar value of the building and lot received worth $200,000 plus + the cash of $25,000 in the exchange minus - her expenses on the trade which is the sales commissions to the real estate broker of $10,000;
$200,000 + $25,000 - $10,000 = $215,000.
The <em>adjusted basis in the assets sold </em>is (original cost of current location-Depreciation on the facility) $150,000 - $37,500 = $112,500.
Since the <em>amount realized on the sale</em> is greater than the <em>original cost of current location </em>the exchange produced a realized gain.
The realized gain is (Darla's <em>amount realized on the sale) </em>$215,000 - $112,500 (<em>adjusted basis in the assets sold)</em> = $102,500
Answer:
Explanation:
Before preparing the retained earning statement, First, we have to compute the ending balance of the retained earning account.
The formula to compute the retained earnings ending balance is shown below:
The ending balance of retained earning = Beginning balance of retained earnings + net income - dividend paid
= $17,200 + $10,400 - $6,000
= $21,600
The ending balance of retained earnings is shown in the attached spreadsheet.
<span>Originally, I thought I would consider Todd to be my agent. After finding out that Todd did not inform me concerning his ownership of the two condos, I don't believe I would be comfortable with him. While his ownership may not change anything, I just was uncomfortable with the fact that he didn't tell me.</span>
Answer:
December 31 (office equipment depreciation expense)
- Dr Depreciation Expense - office equipment 1,400
- Cr Accumulated Depreciation - office equipment 1,400
Dec. 31 (production equipment depreciation expense)
- Dr Depreciation Expense - production equipment 2,650
- Cr Accumulated Depreciation - production equipment 2,650
Explanation:
Since depreciation is an expense and it increases, it should be debited.
Since accumulated depreciation is a contra asset account and it increases, it should be credited.
