Answer:
Cash disbursements for insurance would be $ 168,700.
Explanation:
In accrual based accounting expenses are recorded when they are incurred. The payment against item purchased does not make it qualified to be recorded as expense. Any advance payment made is recognize as asset untill performance obligation has been completed. So in order to determine amount of payment we will use following accounting equation.
Payments = Prepaid current period + expenses - opening prepaid balance
Payments = 197,000 + 62,000 - 90,300 = $ 168,700
Answer:
The accrual basis provides more useful information for decision makers as it matches better revenue against expenses.
Explanation:
net earnings under the cash basis of accounting:
service revenue $22,000
less operating expenses $13,000
less insurance $3,600
Net earnings $5,400
net earnings under the accrual basis of accounting:
service revenue $28,000
less operating expenses $14,500
Net earnings $13,500
The accrual basis provides more useful information for decision makers as it matches better revenue against expenses.
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Answer:
Option (b) Decline 20%
Explanation:
Data provided in the question:
Firm X has declared a stock dividend that pays one share of stock for every five shares owned
Therefore,
The increase in number of shares
= [ 1 ÷ 5 ] × 100%
= 20%
Thus,
The earnings per share will decrease by the amount of increase in number of shares i.e decrease by 20%
Hence,
Option (b) Decline 20%
Answer:
Innovative change
Explanation:
Innovation means change, hopefully a change for better. When a company decides to innovate its processes it means that it is trying to improve existing processes to make them more effective and more productive. In this particular case by starting to work weekend shifts they are trying to offer a better service.
Answer:
$9.74
D0 $0.75
b 1.70
rRF 4.5%
rM 10.5%
g 6.5%
D1 = D0(1 + g) =$0.7988
rS = rRF + b(rM - RRF) =14.7%
P0 = D1/(rS - g)=$9.7
Explanation:
