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2 years ago

A piece of manufacturing equipment was purchased at the beginning of 2021 for an original cost of

Business

1 answer:

navik [9.2K]2 years ago

4 0

Answer:

$6,750

Explanation:

The applicable depreciation method for this equipment is the unit of production depreciation method.

Unit of depreciation calculates the depreciation amount by dividing the depreciable value by total expected production.

The depreciable value = cost price - salvage value

Cost price is $50,000

salvage value = 10%. or 10/100

=0.1 x $50,000

=$5,000

Depreciable value =$50,000 - $5000

=$45,000

Total expected production for the five years

=4,000 + 10,000 +12,000 +8,000 + 6,000

=40,000 units

Depreciation per unit = $45,000/40,000

=$1.125 per unit

In 2025, 6,000 units were produced, depreciation will be

=$1.125 x 6000 units

=$6,750

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Problem 5-30 Graphing; Incremental Analysis; Operating Leverage [LO5-2, LO5-4, LO5-5, LO5-6, LO5-8][The following information ap

WARRIOR [948]

Answer:

Break Even Point

In Units = 2,000 units

In value = $80,000

Explanation:

Break even Point = $\frac{Fixed\ Cost}{Contribution}$

When we use contribution per unit, we get the break even point in units sales.

When we use the contribution margin as a percentage of sales we get break even sales in value.

Contribution per unit = $20

Contribution margin in percentage = $20/$40 = 50%

Therefore, Break even Point in units = $\frac{40,000}{20} = 2,000$

Break even units = 2,000

Break Even Point in value = $\frac{40,000}{0.50} = 80,000$

Sales to be made in value at break even = $80,000

8 0

2 years ago

Tropetech Inc. has an expected net operating profit after taxes, EBIT(1 – T), of $2,400 million in the coming year. In addition,

WARRIOR [948]

Answer:

Explanation:

The computation is shown below:

The free cash flow is

= Expected net operating profit after taxes - net capital expenditure - net operating working capital

= $2,400 million - $360 million - $45 million

= $1,995 million

Now the total firm value is

= Free cash flow ÷ (cost of capital - growth rate)

= $1,995 million ÷ (11.70% - 3.90% )

= $1,995 million ÷ 7.8%

= $25,576.92 million

Now the intrinsic value of equity is

= Total firm value - outstanding debt - preferred stock

= $25,576.92 million - $11,510 million - $6,394 million

= $7,672.92 million

And, the intrinsic value per share

= $7,672.92 million ÷ 675 million shares

= $11.37 per share

7 0

2 years ago

A dealer bought some tires for 6500. the tires were sold for 9500. making 50 on each tire. how many tires were involved?

VMariaS [17]

Cost price = 6,500
Selling price + profit = 9500
Profit gained = 9,500 - 6,500 = $3000
Number of tires bought = 3000/50 = 60
The dealer bought 60 tires.

6 0

2 years ago

During Burns Company's first year of operations, credit sales totaled $166,000 and collections on credit sales totaled $118,000.

marusya05 [52]

Answer:

1. Prepare all appropriate journal entries relative to uncollectible accounts and bad debt expense.

Db Bad debt expense_______ 3320

Cr Allowance for bad debt_________________ 3320

Db Allowance for bad debt__ 430

Cr Account Recevaible_____________________ 430

2. Show the year-end balance sheet presentation for accounts receivable.

Account receivable__________47570

Net account receivable_______44250

Explanation:

Credit sales 166000

Credir sales 118000

Bad debt losses 2%

Writte off 430

Allowance 3320

Db Bad debt expense_______ 3320

Cr Allowance for bad debt_________________ 3320

Db Allowance for bad debt__ 430

Cr Account Recevaible_____________________ 430

Year end balance___________48000

Cr Account Recevaible_________430

Account receivable__________47570

Allownace for bad debts_______3320

Net account receivable_______44250

5 0

2 years ago

On January 1, a company borrowed cash by issuing a $300,000, 5%, installment note to be paid in three equal payments at the end

Stella [2.4K]

Answer & Explanation:

1- What would be the amount of each installment?

The principal to be paid in each instalment = $300,000/3 = $100,000

1st instalment = $300,000*5% + $100,000 = $115,000

2nd instalment = $200,000*5% + $100,000 = $110,000

3rd installment = $100,000*5% +$100,000 = $105,000

2- Prepare an amortization table for the instalment note.

Please see excel in attachment

3- Prepare the journal entry for the second installment payment.

Debit loan payables account: $100,000

Debit Interest expenses: $10,000

Credit cash: $110,000

Download xlsx

5 0

2 years ago