Answer:
Assets should be recorded at cost basis. To determine cost basis we should determine the price that the company paid for the asset. If the only record about the purchase transaction is the note payable, then we can assume that the amount specified in the note payable is the purchase cost of the asset. The cost basis doesn't include any type of interest, but since the note doesn't specify any interest, then we can assume that there is no interest charged.
Answer:
Internal Rate of Return (IRR) 9,00%
Explanation:
We use excel or a spreadsheet to calculate this ratio. See document attached.
We use a cash flow to solve this problem.
At moment 0 we have the investment cost , in this case $365,695. From period 1 to period 9, we have incomes o benefits of $61,000. Then, we calculate the Net cash flow that is the difference between benefits and cost.
We use all the result (positive and negative) in Net cash flow to get the IRR.
Answer:
Letter b is correct. <u>Joint venture.</u>
Explanation:
The Joint Venture strategy can be defined as an economic association that occurs between two or more companies, whose objective is to carry out a certain activity during a limited period of time.
Joint Venture operations are commonly used for various organizational purposes, such as commercial, logistical, technological, etc., in addition to being a strategy that makes it possible to accelerate business by combining business resources.
It is necessary to know that in addition to the mutual benefits, the companies that adopt this strategy also share the same risks and costs, therefore planning is necessary so that the commercial association is profitable for both companies.
Answer: $57,455.395
Explanation:
Given that,
Fixed assets purchased = $387,950
MACRS rates are as follows:
Year 1 = 0.3333
Year 2 = 0.4445
Year 3 = 0.1481
Year 4 = 0.0741
Depreciation Expense in Year 3:
= Initial Value or Purchase Price of equipment × MACRS rate for Year 3
= $387,950 × 0.1481
= $57,455.395
