The courts and equal employment opportunity guidelines have mandated that performance measurements be based on

Greystone Group is looking to purchase Heartland Hotels, Inc. Greystone plans to use $5 million in cash and finance $20 million

kramer

Answer:

Leverage buyout

Explanation:

Leverage buyout refers to the acquisition of another company using debt as the main source of financing the deal. The acquiring company borrows from various sources and will often use the assets of the acquired company as collateral. In leverage buyout, the acquiring entity borrows up to 80 percent or more and finances the balance with its equity.

The use of debt enhances the rate of return of the acquiring firm. Greystone Group is using 5 million of its funds and borrowing 20 million. The debts represent 80 percent of the cost of acquisition. The acquiring entity can achieve a higher rate of return by using as little of its funds as possible.

5 0

2 years ago

Callas Corporation paid $380,000 to acquire 40 percent ownership of Thinbill Company on January 1, 20X9. The amount paid was equ

Brilliant_brown [7]

Answer: Please refer to Explanation

Explanation:

A.

January 1 20X9

DR Investment in Thinbill Company $380,000

CR Cash $380,000

(To record Investment in Thinbill Company)

DR Investment in Thinbill Company $18,000

CR Income from Thinbill Company $18,000

(To record income from Thinbill company)

DR Investment in Thinbill Company $8,000

CR Unrealised gain on Investment $8,000

(To record share of OCI reported by Thinbill Company)

DR Cash $3,600

CR Dividend $3,600

(To record dividend received from Thinbill Company)

Workings

Income from Thinbill Comapny

Callas owns 40% of Thinbill company and so is entitled to 40% of income which is,

= 40% x 45,000

= $18,000

Dividends

= 9,000 x 40%

= $3,600

Unrealised Gain on Income

= 20,000 x 40%

= $8,000

b. The closing entries are as follows,

DR Income from Thinbill Company $18,000

CR Retained Earnings $18,000

(To recognise income from Thinbill Company)

DR Unrealised Gain on Investment $8,000

CR Accumulated OCI Income from Investee (Thinbill Company) $8,000

(To record accumulated OCI income)

5 0

2 years ago

Charlotte (age 40) is a surviving spouse and provides all of the support of her four minor children, who live with her. Charlott

Juliette [100K]

Answer:

Tax = $5,445

Explanation:

Given

Salary = $80,000

Short-term capital loss = $2,000

Cash prize = $4,000

Personal and dependency exemptions = $4,000*7 = $28,000

Standard deductions = $11,900 (for surviving spouse in 2012)

Calculating AGI

AGI = Salary - Capital Loss + Cash Prize

AGI = $80,000 - $2,000 + $4,000

AGI = $82,000

Calculating Taxable Income

Taxable Income = AGI - Personal And Dependency Exemption - Standard Deductions

Taxable Income = $82,000 - $28,000 - $11,900

Taxable Income = $42,100

From The Federal Income Tax Brackets for 2012,

Charlotte falls with the 15% tax bracket.

There are 15% tax, so we calculate as follows:

10% of the first bracket is

$17,400 * 10% = $1,740

15% is the amount in the second bracket

15% of (42,100 - 17400) = 3,705

Tax = $3,705+ $1,740

Tax = $5,445

3 0

2 years ago

Analyzing Data In June, Snead’s Snack Bar sold 1,000 fruit smoothies at a price of $2.50 each. In July, they sold 1,300 fruit sm

Verizon [17]

Overall, Snead's Snack Bar earned more in July, with $2600, while in June they only earn $2500

5 0

1 year ago

On January 1, 2016, Ott Company sold goods to Fox Company. Fox signed a noninterest-bearing note requiring payment of $60,000 an

inessss [21]

Answer:

D. 321,600.

Explanation:

Present value is the current value of a future amount that is to be received or paid out.

Given:

Present value, P = $60000

Present value of ordinary annuity for the remaining 6 years = 4.36

The Present value, PV of the note is equal to the first payment + the Present value of ordinary annuity (all at 10%) of the remaining six payments

Sales revenue = $60000 + (60,000 × 4.36)

= $60000 + $261,600

= $321,600

Thus, sales revenue of $321,600.

3 0

2 years ago