Ravine Corporation purchased 30 percent ownership of Valley Industries for $94,800 on January 1, 20X6, when Valley had capital stock of $260,000 and retained earnings of $56,000. During the period of January 1, 20X6, through December 31, 20X9, the market value of Ravine's investment in Valley's stock increased by $11,000 each year. The following data were reported by the companies for the years 20X6 through 20X9:
Dividends Declared
Year Operating Income, Ravine Corporation Net Income, Valley Industries Ravine Valley
20X6 $ 140,000 $ 30,000 $ 70,000 $ 20,000
20X7 80,000 50,000 70,000 40,000
20X8 220,000 10,000 90,000 40,000
20X9 160,000 40,000 100,000 20,000
Required:
a. What net income would Ravine Corporation have reported for each of the years, assuming Ravine accounts for the intercorporate investment using the cost method and the equity method?
b-1. Give all appropriate journal entries for 20X8 that Ravine made under the cost method. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answers
Answer:
A. Ravine Corporation net income using the cost method
20X6 Net income=$146,000
20X7 Net income=$92,000
20X8 Net income =$229,000
20X9 Net income=$166,000
Ravine Corporation net income using the equity method
20X6 Net income=$149,000
20X7 Net income=$95,000
20X8 Net income=$223,000
20X9 Net income=$172,000
b-1 Dr Cash $12,000
Cr Dividend income $9,000
Cr Investment in S $3,000
b-2 Dr Cash $12,000
Cr Investment in S $12,000
Dr Investment in Valley stock $3,000
Cr Income from S $3,000
Explanation:
a. Calculation for what net income would Ravine Corporation have reported for each of the years
Ravine Corporation net income using the cost method
20X6 Net income= $140,000 + 0.30($20,000)
20X6 Net income=$146,000
20X7 Net income= $80,000 + 0.30($40,000)
20X7 Net income=$92,000
20X8 Net income= $220,000 + 0.30($30,000)
20X8 Net income =$229,000
20X9 Net income= $160,000 + 0.30($20,000)
20X9 Net income=$166,000
Calculation 20X8 Dividend declared
Dividend declared=($30,000 + $50,000 – $20,000 – $40,000 )+ $10,000
Dividend declared=$20,000+$10,000
Dividend declared=$30,000
Ravine Corporation net income using the equity method
20X6 Net income= $140,000 + 0.30($30,000)
20X6 Net income=$149,000
20X7 Net income= $ 80,000 + 0.30($50,000)
20X7 Net income=$95,000
20X8 Net income=$220,000 + 0.30($10,000)
20X8 Net income=$223,000
20X9 Net income=$160,000 + 0.30($40,000)
20X9 Net income=$172,000
b-1 Preparation of the journal entries for 20X8 that Ravine made under the cost method
Dr Cash $12,000
(0.30*$40,000)
Cr Dividend income $9,000
(0.30*$30,000)
Cr Investment in S $3,000
($12,000-$9,000)
b-2 Preparation of the journal entries for 20X8 that Ravine made under the Equity method
Dr Cash $12,000
Cr Investment in S $12,000
(0.30*$40,000)
Dr Investment in Valley stock $3,000
Cr Income from S $3,000
($12,000-$9,000)
Related Questions
Explain how using a credit card can be similar to
getting an interest free loan
Answers
Answer: Credit cards can easily work as a short-term loan, but cards that offer 0% APR for a limited time have the potential to be “free.” The key to using a credit card as an interest-free loan is making sure you can pay every cent of your balance off before your card's introductory offer ends.
Explanation:
Here are simplified financial statements for Watervan Corporation:
1.) Calculate Watervan’s economic value added (EVA).
Note: Do not round intermediate calculations. Enter your answer in millions rounded to 2 decimal places.
2.) What is the company’s return on capital? (Use start-of-year rather than average capital.)
Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.
3.) What is its return on equity? (Use start-of-year rather than average equity.)
Note: Enter your answer as a percent rounded to 2 decimal places.
Answers
Based on the financial statements given for Watervan Corporation, the Economic Value Added is $54.501 million.
What is the Economic Value Added?This can be found by the formula:
= (EBIT x (1 - Tax rate)) - (Cost of capital x Capital)
Tax rate is:
= 20 / 97 x 100
= 20.6%
Capital invested:
= Equity + Long term debt
= 256 + 121
= $377 million
Economic value added is:
= (109 x (1 - 20.6%)) - (8.5% x 377)
= $54.501 million
Find out more on economic value added at https://brainly.com/question/15469792.
#SPJ1
Haile Resort opened for business on June 1 with eight air conditioned units. Its trial
balance on August 31 is as follows.
Haile Resort
Trial Balance
August 31, 2022
Debit Credit
Cash Br. 39,200
Prepaid Insurance 9,000
Supplies 5,200
Land 40,000
Buildings 240,000
Equipment 32,000
Accounts Payable Br. 9,000
Unearned Rent Revenue 9,200
Mortgage Payable 100,000
Share Capital—Ordinary 200,000
Retained Earnings 0
Dividends 10,000
Rent Revenue 172,400
Salaries and Wages Expense 89,600
Utilities Expense 18,400
Maintenance and Repairs Expense 7,200
Br.490,600 Br.490,600
Other data:
1. The balance in prepaid insurance is a 1-year premium paid on June 1, 2022.
2. An inventory count on August 31 shows Br.1,300 of supplies on hand.
3. Annual depreciation rates are buildings (4%) and equipment (10%).
4. Unearned rent revenue of Br.7,600 should be recognized as revenue prior
to August 31.
5. Salaries and wages of Br.750 were unpaid at August 31.
6. Rentals of Br.1,600 were due from tenants at August 31.
7. The mortgage note is dated 1/1/2022. The mortgage interest rate is 8% per
year.
Instructions
b. Prepare an adjusted trial balance on August 31.
Answers
Answer:
Explanation:
awerness
The adjusted trial balance of Haile Resort bon August 31, will be equals to $498,283.33.
Please refer to the attached table below for the complete adjusted trial balance table.
Let's discuss how each adjustments are made and recorded on the adjusting process.
The prepaid insurance is a 1-year premium paid on June 1, 2022 with total amount of $9,000. Hence, on August 31, the prepaid insurance has accrued as insurance expense by:
Insurance expense = $9,000 x 3/12
Insurance expence = $2,250
The amount of insurance expense will be recorded in the debit account and credits the prepaid insurance account.
On August 31, inventory account shows balance of $1,300 supplies hence, we should record the supplies expense to balance the decrease in the supplies account by:
Supplies expense = Initial supplies - ending supplies
Supplies expense = $5,200 - $1,300
Supplies expense = $3,900
The amount of supplies expense should also recorded as credit on supplies account.
Annual depreciation for building and equipment will be recorded as credit on each assets account and as debit on depreciation expense account. The depreciation expense for each asset would be:
Depreciation, building = 4% x Building x 3/12
Depreciation, building = 4% x $240,000 x 3/12
Depreciation, building = $2,400
Depreciation, equipment = 10% x Equipment x 3/12
Depreciation, equipment = 10% x $32,000 x 3/12
Depreciation, equipment = $800
Note that Haile Resort just opened on June 1. Hence, the depreciation on August 31 should be counted as depreciation after 3-months operation period.
Unearned revenue of $7,600 will be recognized as revenue by August 31. This amount will be recorded under unearned revenue account as debit and as credit on rent revenue account.
Unpaid salaries and wages of $750 will be recorded under salaries and wages payable account on credit and debits the salaries and wages expense account.
Rentals of $1,600 due from tenants will be recorded as rent revenue on credit and debits on cash.
The mortgage interest rate will be recorded under interest expense on debit and credits the mortgage payable account. The amount of interest expense accrued on August 31 would be:
Interest expense = 8% x Mortgage payable x 8/12
Interest expense = 8% x $100,000 x 8/12
Interest expense = $53,333.33
Learn more about Adjusted Trial Balance here: brainly.com/question/13927466
#SPJ1
What are 3 benefits of the ProAdvisor Discount Program (Quickbooks Online)
Answers
Based on business management, the 3 benefits of the ProAdvisor Discount Program (Quickbooks Online) include "allow accounting personnel to grow their business, skills and QuickBooks® expertise."
Some other benefits of the ProAdvisor Discount Program (Quickbooks Online) include the following:
Training other accounting personal.Improving customer care.She is serving as a strategic marketing tool.Creating accountant-specific product discounts.Hence, in this case, it is concluded that there are various benefits of the ProAdvisor Discount Program (Quickbooks Online).
Learn more about Quickbooks Online here: https://brainly.com/question/25512540
define central bank.
Answers
Answer:
An institution that manages the currency and monetary policy of a state of formal monetary union and over sees a banking system. The Federal Reserves are in control of these banks
Explanation:
Good luck
Based on the module, describe three strategies that can help you use credit wisely.
The number of individuals who experience credit problems has grown in recent years. What factors have contributed to this growth? What should be done to reduce this
Answers
Answer:
If you're talking about credit card for the first question here u go... Spend within your means. The best way to avoid credit card debt is to pay your balance in full each month.Make monthly payments on time. ...Keep a low utilization ratio. Understand your credit card terms. Don't open too many accounts in a short period of time.
Explanation:
....
I hope this is helpful?
Do you think being charitable can be taught?
Answers
Answer:
Yes, I feel like anyone can be taught what charitable means and what it is. Its all about helping..and anyone could learn that without being taught
Explanation:
Get in the habit of using the term "we" rather than "I" when
referencing ideas/research throughout the presentation and the Q/A. True or false ?
Answers
The answer is true. Through a presentation, a speaker imparts knowledge to an audience. The typical goals of a presentation are to inform, persuade, inspire, motivate, foster goodwill, or propose a novel concept or service.
Speeches, introductions, lectures, and demonstrations are all examples of presentations. Divide your audience into these three categories to better focus your message: You must include an introduction, a body, and a conclusion in audience presentation. An intriguing start. Explain why your audience will find what you're about to talk about in your introduction valuable or important while providing a brief summary of it. Give the supporting information in a body.
To learn more about Presentations, click here.
https://brainly.com/question/1802560
#SPJ1
A corporation uses the indirect method for preparing the statement of cash flows. A fixed asset has been sold for $21,832 representing a loss of $3,248. Determine the amount that would appear in the operating activities section of the statement of cash flows based on this transaction.
Answers
In the operating activities section of the statement of cash flows, the amount related to this transaction would be the loss of $3,248 added back to the net income.
In the indirect method of preparing the statement of cash flows, the operating activities section includes adjustments to net income for non-cash items and changes in working capital. The sale of a fixed asset and the loss incurred from it are both non-cash items that need to be considered.
Since the loss from the sale of the fixed asset is $3,248, this loss is added back to the net income when calculating the operating activities section. This is because the loss is a non-cash expense and does not represent an actual outflow of cash.
Therefore, in the operating activities section of the statement of cash flows, the amount related to this transaction would be the loss of $3,248 added back to the net income. This adjustment would increase the net income by $3,248 in the operating activities section, reflecting that the loss from the sale of the fixed asset does not affect the cash generated or used by the operating activities of the corporation.
For more such questions on transaction
https://brainly.com/question/1016861
#SPJ8
If the present value of my investment is S9,000 and the rate of interest is 3⅓% compounded annually, what will the value be after 4 years?
Answers
The value after 4 years will be $10327.71 with the present value of $9000.
What is compound interest?Compound interest, often known as interest on interest, is the practice of adding interest to the principal amount of a loan or deposit. It occurs when interest is reinvested rather being paid out, resulting in interest being generated on both the principal amount and any accumulated interest over the next period.
What is the investment?An asset that is developed with the purpose of enabling money to accumulate is essentially what an investment is. The wealth generated can be used for a variety of objectives, including bridging income gaps, saving for retirement, or carrying out certain particular commitments like loan repayment, tuition payment, or the acquisition of other assets.
To know more about Investment visit:
https://brainly.com/question/15353704
#SPJ1
You have received two bids from outside companies to conduct guest satisfaction surveys for you. You want at least 320 responses. Company A charges $3,200 + $6 per respondent. Company B charges $4,000 + $3 per respondent. Which company will cost you less?
a) Company A
b) Company B
Answers
From the two bids received from outside companies to conduct guest satisfaction surveys, the company that would cost me less will be Company B which charges $4,000 + $3 per respondent.
What is a bid?A bid is the price offer that a corporation or individual is willing to pay in the context of auctions, stock exchanges, or real estate. Bidding is an individual or business's offer to set a price for a product or service, or a demand that something is done. Bidding is a method of determining the price or worth of something.
Bidding can be done by a person who is influenced by a product or service in a given setting. It is used by numerous economic niches to determine demand and thus the worth of a commodity or property. In today's modern technology environment, the Internet is a preferred platform for giving bidding services.
Therefore, from the bids received it can be concluded that Company B would cost less.
To learn more on bid, click here:
https://brainly.com/question/28436717
#SPJ3
Clinic uses the direct method to allocate service department costs to operating departments. The clinic has two service departments, Personnel and Support, and two operating departments, Prenatal and Pediatrics. Service Departments Operating Department Personnel Support Prenatal Pediatrics Departmental costs $ 23,724 $ 44,400 $ 109,770 $ 298,910 Employee hours 5,000 1,000 25,000 20,000 Space occupied 3,000 2,000 35,000 7,000 Personnel Department costs are allocated on the basis of employee hours and Support Department costs are allocated on the basis of space occupied in square feet. The total Pediatrics Department cost after the allocations of service department costs is closest to
Answers
The total Pediatrics Department cost after the allocations of service department costs is closest to $316,869.
Total Pediatrics Department costEmployee Hours:
Total Allocation Percentage = 20,000/(25,000+20,000)
Total Allocation Percentage = 20,000/45,000
Total Allocation Percentage =0.44
Allocated cost for personnel = .44× $ 23,724
Allocated cost for personnel =10,544
Space Occupied:
Total Allocation Percentage = 7,000/(35,000+7,000)
Total Allocation Percentage = 7,000/42,000
Total Allocation Percentage = 0.167
Allocated cost for personnel =0.167×$44,400
Allocated cost for personnel =7415
Total Cost:
Total cost=$298,910+$ 10,544 +$ 7415
Total cost= $316,869
Inconclusion the total Pediatrics Department cost after the allocations of service department costs is closest to $316,869.
Learn more about Total Pediatrics Department cost here:https://brainly.com/question/26656438
Rebecca holds 100 shares of Gotchas stock that she purchased for $4,200 several years ago. In a merger of Gotchas into Solis, Inc., Rebecca exchanges her 100 Gotchas shares for 1,000 Solis shares and $840. Gotchas is valued at $92.40 per share and Solis at $8.40 per share.
a. What is Rebecca's realized and recognized gain/loss from the reorganization?
The exchange of Rebecca’s stock
has no
income tax consequences for Gotchas or Solis.
b. What is Rebecca's basis in her Solis stock?
$fill in the blank 2
8,400
Answers
Rebecca suffered a loss as a result of the merger of two companies.
How did she end up losing in this situation?She first purchased 100 Gotchas shares for a total of $4200. And after the merger, she sold these shares and purchased new Solis shares, where she gained $5000 after selling previous shares but lost $3400 after purchasing new shares.
Merging means combining two separate legal entities into a single new legal entity. True mergers are uncommon because it is uncommon for two equal companies to benefit mutually from combining resources and personnel, including their CEOs.
A merger is a business transaction in which two existing, independent companies join forces to form a new, single legal entity.
To know more about merge visit:
https://brainly.com/question/29870936
#SPJ1
The US Senate overwhelmingly passed the 2022 Defense Authorization Act. The $768 billion "Defense Authorization Act" not only exceeds the defense spending proposed by the Biden administration by $25 billion, but also increases the US defense budget by about 5% compared to last year.
Answers
The US Senate passed the 2022 Defense Authorization Act, a $768 billion bill that surpasses the Biden administration's defense spending proposal by $25 billion and represents a 5% increase in the US defense budget compared to the previous year.
1. The US Senate passed the 2022 Defense Authorization Act.
2. The Defense Authorization Act is a bill that determines the budget and expenditures for the US defense sector.
3. The total amount allocated for the Defense Authorization Act is $768 billion.
4. The defense spending proposed by the Biden administration was exceeded by $25 billion in this Act.
5. The Act represents a 5% increase in the US defense budget when compared to the previous year.
6. This increase in the defense budget indicates a commitment to strengthening the country's defense capabilities.
7. The Act was passed overwhelmingly, indicating strong support from the Senate.
8. The Defense Authorization Act is an essential piece of legislation that ensures the funding and resources necessary for the US military to carry out its operations effectively.
9. The Act covers various aspects of defense spending, including military personnel, equipment, research and development, and strategic initiatives.
10. By passing the Defense Authorization Act, the US Senate has demonstrated its commitment to national security and defense preparedness.
For more such questions on Defense Authorization Act, click on:
https://brainly.com/question/29225501
#SPJ8
HELP ASAP! TIMED! A crisis management team does all of the following except _____ .
handle all service failures
oversee the situation before, during, and after it occurs
coordinate communications
instruct employees and customers
Answers
Investors expectations of the federal reserve cutting interest rates in the near future caused _ in demand for bonds in the corporate bond markets because the expected value of fixed interest payments has _.
I have answered the question. Is this correct?
Answers
Investors expectations of the federal reserve cutting interest rates in the near future caused increased in demand for bonds in the corporate bond markets because the expected value of fixed interest payments has decreased
What is Investors expectations about?Investors expectations of the federal reserve cutting interest rates in the near future can have an impact on the demand for bonds in the corporate bond markets.
However, the direction of the change in demand for bonds, and the change in the expected value of fixed interest payments, would depend on the specific details of the situation, such as the current state of the economy and the monetary policy of the Federal Reserve.
Learn more about Investors expectations from
https://brainly.com/question/20533942
#SPJ1
What is the main reason that people purchase insurance policies?
A. they want to reduce the cost of their student or personal loans.
B. They want to avoid paying for major unexpected expenses.
C. They want to avoid increasing their monthly premiums
D. They want to invest money in insurance to grow it over time
Answers
Option B is correct. The main reason that people purchase insurance policies is because they want to avoid paying for major unexpected expenses.
What is an insurance policies?An insurance policy can be defined a contract between the insurer and the policyholder which determines the claims which the insurer is legally required to pay. The policy is enforced in an exchange for an initial payment known as the premium in which the insurer promises to pay for loss caused by perils covered under the policy language.
Most of the insurance contracts are designed to meet specific needs and thus have many features not found in many other types of contracts. Because these insurance policies are standard forms, they often feature boilerplate language which is similar across a wide variety of different types of insurance policies.
Some examples of the popular insurance policies includes a Life Insurance, Health Insurance, Disability Insurance, Homeowner's Insurance, Automobile Insurance, Liability Insurance etc,
Read more about insurance policies
brainly.com/question/25855858
#SPJ1
Select the correct text in the passage.
Which sentence demonstrates the use of secondary market research technique?
Keith wants to start a fast-food stall. 1. He interviewed people in the area where he wants to put up his stall. 2. He also gave out questionnaires to
understand people's opinions. 3. He worked out the cost and investment details with the help of the Internet. He is now all set to speak to the
bank to apply for a business loan.
Answers
Answer: I heard its the second option, I cannot verify that. But i do have the awnsers to every question for the final in Entrepreneruship, Its on quizlet labeled Entrepreneurship. 37 terms.
Explanation:
Answer:
3. "...with the help of the internet"
Explanation:
In the tutorial it states examples of secondary market research (ex. journals, trade magazines, trade associations, or the Internet"
((Currently doing my final exam, hope all goes well with those taking the final as well))
Quintina decided to increase the deduction percentage of her federal income tax rate from 14% to 16%. Quintina’s gross pay per month is $2,100. Her deductions before the change are listed in the table.
Deduction
Dollar Amount
Federal Income Tax
$294
State Income Tax
$89
Social Security
$85
Medicare
$35
What is her new monthly net pay? Round your answer to the nearest dollar.
$1555
$1591
$1595
$1639
Answers
Answer:
The answer would be A. $1555
A. $1555
Have a good day
Assume a project with and outlay of 200, and inflows of 100 for three years, starting one year from today. Find IRR.
Answers
Answer:
Explanation:
The internal rate of return (IRR) is the discount rate that makes the net present value (NPV) of the cash flows from the project equal to zero. To find the IRR, you can use a financial calculator or spreadsheet software that has a built-in IRR function.
In this case, the initial outlay is -200 and the cash flows for the next three years are 100, 100, and 100.
The IRR can be calculated using excel formula =IRR(values,guess) where values is the range of cells containing the cash flows and guess is the estimated IRR.
Alternatively, you can use online IRR calculators as
QUESTION TWO
On completion of writing up the books, the following matters are brought to your
attention:
a) Stocks of food and drink at 28 February 2012 are valued at $250.
b) Mr. Shah owes a waiter $20 in respect of overtime worked in week 4.
c) The rates payments cover the period 1 February to 30 April
d) Electricity consumed in the month is estimated to be. $100.
e) Being a prudent man, Mr. shah instructs you to create a provision for doubtful
debts of 4% of debtors.
f) It is decided to write off fixtures and fittings by equal installments over 10 years.
You are required to:
1) Adjust the books for the above
2) Prepare the restaurant's trading and profit and loss account for the first month
and a balance sheet as at 28 February 2001
Answers
Explanation:
it's tedious. I need help on this question. it looks like an incomplete question
The percentage of the total market for a business is referred to as
Choose the answer.
marketing goals
marketing strategy
market share
Answers
marketing strategy
Explanation:
Its marketing strategy because the only way u can have percentage of the market
Having more capital goods requires
spending more of our money on consumer goods
giving up some present day consumption
giving up some present day investment spending
increased government regulation about what should be produced
Answers
Answer:
spending more money on consumer
the basics of color theory assume what central tenets?
Answers
Answer:
Color has important psychological and visual effects on the audience.!
Explanation:
give brainly please:)
Answer:I hope this helps you out
Explanation:
The basics of color theory assume three central tenets: hue, saturation, and brightness. Hue is the aspect of color that we identify as red, blue, green, yellow, etc. Saturation refers to the intensity or purity of a color, and brightness refers to how light or dark a color appears.
Juniper Design Limited of Manchester, England, is a company specializing in providing design services to residential developers. Last year the company had net operating income of $420,000 on sales of $1,500,000. The company’s average operating assets for the year were $1,700,000 and its minimum required rate of return was 15%.
Required:
Compute the company’s residual income for the year.
Answers
Answer: 165,000
Explanation:
To compute the company’s residual income for the year, we can use the formula:
Residual Income = Net Operating Income – (Minimum Required Rate of Return x Average Operating Assets)
Given: Net Operating Income = $420,000 sales = $1,500,000
Average Operating Assets = $1,700,000
Minimum Required Rate of Return = 15% = 0.15
Residual Income = Net Operating Income – (Minimum Required Rate of Return x Average Operating Assets)
Residual Income = $420,000 – (0.15 x $1,700,000)
Residual Income = $420,000 – $255,000
Residual Income = $165,000
Therefore, the company’s residual income for the year was $165,000.
A nation’s culture is the ________ common to its people.
Answers
A nation’s culture is the shared set of beliefs, values, knowledge and patterns of behaviour common to its people.
Step One: You have graduated from college and have established a career. You have been working with the same company for three years. You have saved up $10,000 and need to decide how you will save and invest this money. Your goal is to save as much money in five years as you can for a down payment on a house. Using the principles and strategies of saving and investing, create a saving and investing plan. Remember, a saving and investing plan is an outline or list that names the types of savings or investments you will use. The outline also shows the amount or percentage you will put into each savings account or investment. For this project, evaluate and select at least three investments or savings accounts. Upload the document. Step Two: Select specific accounts and investments. For example, if your outline includes investing $1,000 in stock, research and select a stock. Create a portfolio with a spreadsheet or word processor. See the example below:
Answers
Answer12
Explanation: so it is 6+6+22=2
Some of the forklifts we use in the distribution centers will have to be replaced in the second quarter of the 2023 financial year, and we have to start thinking about it soon! We always purchased the forklifts outright from available cash resources or funded them by borrowing the required funding from the bank. We have recently learnt that many companies choose to lease their forklifts. These forklifts normally last a good ten years if we take good care of them. Prepare some relevant information that needs to be considered in a decision to lease or purchase?
Report on the following:
● Different options in the market
● Accounting treatment of the options
● Tax implications of the options
● Cost differentials and
● Cash flow implications
What would the correct decision be for the company.
Answers
Different options in the market:
The distribution center has two options when it comes to replacing its forklifts – leasing or purchasing. With leasing, the center would use the forklifts for a specified period, usually a few years, and then return them to the leasing company. On the other hand, purchasing the forklifts will give the center permanent ownership of the forklifts.
Accounting treatment of the options:
Leasing forklifts is treated as an operating expense that is reflected in the income statement. The lease payments are recorded as expenses over the life of the lease. However, purchased forklifts are treated as a fixed asset that is depreciated over their useful life. The depreciation expense is recognized over several accounting periods on the income statement.
Tax implications of the options:
Leasing forklifts can provide significant tax savings for the business as the lease payments are fully tax-deductible expenses in the financial year they are made. In contrast, depreciation and interest expense for purchased forklifts are deductible over several years, so tax deductions are delayed.
Cost differentials and cash flow implications:
Leasing forklifts would result in lower upfront costs and lower monthly payments compared to purchasing, but the total cost of leasing is typically higher over the long term. In contrast, purchasing requires a substantial upfront payment or a loan, but the total cost is lower over the long term. Cash flow implications of purchasing include funding the entire upfront cost of the forklifts and paying for any maintenance and repairs needed over the lifetime of the forklifts, while cash flow implications of leasing include lower upfront costs but higher monthly payments, which will reduce available cash flow in the short term.
What would the correct decision be for the company:
The company should decide based on its financial situation, long-term business planning, and cash flow requirements. If the company has a limited budget, a short-term need for the forklifts, or requires the latest models frequently, leasing may be a better option. But if the company values ownership, anticipates long-term use or higher utilization, and has the cash resources or access to financing, purchasing may be the more cost-effective option. The decision should consider the financial implications, tax considerations, and cash flow requirements of either option.
Africanisation ( how will you incorporate the learners' culture or heritage into this lesson - playing traditional game, or doing a traditional activity, singing a song, telling a story that relates to the learners culture, use a traditional African teaching strategy - be creative and make this lesson relevant to the learners culture )
Answers
Incorporating learners' culture or heritage into a lesson on Africanisation can be done in a creative and engaging manner.
To make the lesson relevant, I would begin by introducing the topic through a storytelling session, sharing a traditional African tale that highlights the importance of preserving cultural identity. This storytelling session would help students connect with their heritage and develop a sense of pride in their cultural roots.
After the storytelling, I would organize a group activity where students can participate in a traditional African game, such as Mancala or Morabaraba. This game not only promotes critical thinking and problem-solving skills but also exposes students to a traditional African activity that has been enjoyed for generations.
To further immerse students in their culture, I would include a segment where we learn and sing a traditional African song or chant. This would allow students to experience the rhythmic and melodic aspects of African music, fostering a sense of unity and shared heritage among the learners.
Lastly, I would incorporate a teaching strategy known as Ubuntu, a concept deeply rooted in African culture. Ubuntu emphasizes the interconnectedness and interdependence of individuals within a community. Through group discussions and collaborative learning tasks, students would practice Ubuntu, working together, sharing ideas, and respecting diverse perspectives.
By incorporating storytelling, traditional games, music, and Ubuntu, this lesson would provide a comprehensive and culturally relevant exploration of Africanisation, empowering students to appreciate and embrace their own heritage while fostering a sense of unity and respect for others.
For more such questions on heritage
https://brainly.com/question/16855421
#SPJ8
Cost of money Four fundamental factors affect the cost of money: (1) the return that borrowers expect to earn on their investments, (2) the preference of savers to spend their income in the current period rather than delay their consumption until some future period, (3) the risks associated with the investment, and (4) expected inflation. Consider the following statements that address these factors, and indicate which you think are true.
Statement 1: All things being equal, rational savers and investors prefer to invest in an asset that provides a 12% return rather than one that provides an 8% return.
Statement 2: All things being equal, savers and investors prefer more risk to less risk and prefer lower risk premiums on projects exhibiting higher levels of risk.
Statement 3: On average and everything else held constant, borrowers will attempt to pay the maximum possible cash flows that will motivate savers and investors to participate in the transaction.
Statement 4: All things being equal, savers and investors expect to receive some amount of maturity premium as compensation for their deferred consumption.
The true statements are:______.
a. 1, 2, and 3.
b. 1 and 3.
c. 2 and 4.
d. 1, 2, 3, and 4.
Answers
Answer:
b. 1 and 3.
Explanation:
The investors are of two types either they are risk averse or risk seekers. Risk averse are those who are not willing to take risks for their investments. They accept lower returns but they are not ready to take more risks than their appetite. Risk seekers are those who demand more risk for more returns. The risks level is so high that even their whole investments can go away but they take this risk to achieve high extra ordinary returns.