Answer:
Explanation:
Markup is given at 25%
⇒Conversion to gross profit rate = 0.25/1.25 = 20%
Noncontrolling interest’s share
Reported income in 2015 150,000
Add: 2014 intra company gross profit realized in 2015 14,700
[210,000*0.35* 0.20]
Less: Deferred intra company gross profit for 2015 (21,700)
[310,000*0.35*0.20]
2015 realized income 143,000
Outside ownership percentage 40%
Noncontrolling interest’s share 57,200
Consolidation entries
Dr Retained earnings 14,700
Cr Cost of Goods Sold 14,700
Dr Sales 310,000
Cr Cost of Goods Sold 310,000
Dr Cost of Goods sold 21,700
Cr Inventory 21,700
One of the Ten Principles of Economics in Chapter 1 is that people face tradeoffs. The growth that arises from capital accumulation is not a free lunch. It requires that societyA.conserve resources for future generations.B.sacrifice consumption goods and services now in order to enjoy more consumption in the future.C.recycle resources so that future generations can produce goods and services with the accumulated capital.D.None of the above is correct.
Answer:
B.sacrifice consumption goods and services now in order to enjoy more consumption in the future.
Explanation: Tradeoff is a term used in Economics to refer to the sacrifice of a particular quality or goods in order to enjoy the benefits of the use of another.
Tradeoffs are applied in Economic decisions especially in a situation where there are two competing needs, it is applied in order to choose the most urgent and necessary while the other can be considered for a later day or period.
Applying tradeoffs in Economic decisions will lead to an increase of one factor or need which will lead to a decrease in another factor or need.
The sales volume variance is______________.a. further divided into separate sales quantity and sales mix variances
b. further divided into separate revenue and quantity variances
c. not further divided
d. further divided into separate flexible budget and sales volume variances
e. further divided into separate variable and fixed variances
Answer:
The correct answer is letter "A": further divided into separate sales quantity and sales mix variances.
Explanation:
The sales volume variance represents the change inf the profit of a company as a result of the changes in the sales volume per unit. It is calculated by subtracting the budgeted sales volume from the actual sales volume and multiplying the result by the budgeted price per unit of the product.
Sales volume variance can be split in sales mix variance and sales quantity variance which are used to evaluate the performance of the marketing department. The sales mix variance represents the performance of the department selling profitable products while the sales quantity variance shows the performance of the marketing department in terms of overall sales volume.
Alex, who is single, conducts an activity in 2019 that is appropriately classified as a hobby. The activity produces the following revenues and expenses: Revenue $18,000 Property taxes 3,000 Materials and supplies 4,500 Utilities 2,000 Advertising 5,000 Insurance 750 Depreciation 4,000 Without regard to this activity, Alex's AGI is $42,000. Determine the amount of income Alex must report and the amount of the expenses he is permitted to deduct. Assume Alex itemizes his deductions.
Answer:
The solution to the given problem is done below.
Explanation:
Alex must report the $18,000 as revenues. All of the property taxes of $3,000 can be deducted. Because the remaining expenses of $16,250 exceed the balance of $15,000 ($18,000 revenues − $3,000 property taxes), the $15,000 is deductible as follows:
Materials and supplies $ 4,500
Utilities 2,000
Advertising 5,000
Insurance 750
Depreciation (because depreciation is sequenced
last, only $2,750 of the $4,000 is eligible) 2,750
Total deductible expenses $15,000
These expenses of $15,000 are classified as miscellaneous itemized deductions and will be subject to the 2%-of-AGI floor. Hence, $1,200 [($42,000 + $18,000) × 2%] of these expenses is disallowed.
Other AGI $42,000
Revenues from hobby $18,000
Less: Expenses
Property taxes (3,000)
Miscellaneous itemized
deduction ($15,000 − $1,200) (13,800)
Less: Personal exemption (4,050)
Taxable income $39,150
On January 1, 2018, Chamberlain Corporation pays $550,000 for an 80% ownership in Neville. Annual excess fair-value amortization of $25,000 results from the acquisition. For the year ended December 31, 2019, Chamberlain reports net income of $340,000 and Neville reports $175,000. The parent figures contain no income from the subsidiary.
What is the consolidated net income attributable to the non-controlling interest?
Answer:
The question is missing the options, which are contained in the attached question.
The consolidated net income attributable to the non-controlling interest i $30,000.00 with option D as the correct answer as found in the attached
Explanation:
Neville's net income for the year $175,000.00
less annual excess fair value amortization ($25,000.00)
Net income after excess fair amortization $150,000.00
Chamberlain's share of net income
80%*$150,000.00 ($120,000.00)
Non-controlling interest share of net income $30,000.00
Note that the non-controlling interest is a balancing figure.
Chamberlain consolidated income can be computed thus:
Chamberlain 100% net income $380,000.00
Plus share of Neville's net income $120,000.00
Consolidated net income $500000.00
Which of the following is the least likely strategy for a U.S. firm that will be purchasing Swiss francs in the future and desires to avoid exchange rate risk (assume the firm has no offsetting position in francs)?
a. Purchase a call option on francs.
b. Sell a futures contract on francs.
c. Obtain a forward contract to purchase francs forward.
d. All of the above are appropriate strategies for the scenario described.
Answer:B. Sell a futures contract on francs.
Explanation: Futures contracts are contracts that involves the legally agreed purchase or sale of an asset,a commodity or a foreign currency at a given price in a specified period in the future.
Most organisations and Government agencies go into futures contracts especially in situations where foreign exchange is expected to rise in future. THE OBLIGATION OF THE BUYER IS TO ENSURE THAT HE OR SHE BUYS THE ASSET, COMMODITY or CURRENCY WHEN THE FUTURES CONTRACTS EXPIRES.
Mohave Corp. makes several varieties of beach umbrellas and accessories. It has been approached by a company called Lost Mine Industries about producing a special order for a custom umbrella called the Ultimate Shade (US). The special-order umbrellas with the Lost Mine Company logo would be distributed to participants at an upcoming convention sponsored by Lost Mine. Lost Mine has offered to buy 2,800 of the US umbrellas at a price of $26 each. Mohave currently has the excess capacity necessary to accept the offer. The following information is related to the production of the US umbrella: Direct materials $ 11.00 Direct labor 6.00 Variable manufacturing overhead 7.50 Fixed manufacturing overhead 2.50 Total cost $ 27.00 Regular sales price $ 34.00 Required: 1. Compute the incremental profit (or loss) from accepting the special order. 2. Should Mohave accept the special order
Answer:
The incremental profit is $4,200. Mohave should accept this order.
Explanation:
(1) Variable cost per unit = Direct materials + Direct labor + Variable manufacturing overhead
Variable cost per unit = $11 + $6 + $7.5 = $24.5
Incremental profit = (Sale price per unit - Variable cost per unit) x Units sold
Incremental profit = ($26 - $24.5) x 2,800 = $4,200
(2) Mohave should accept the special order because it is resulting in a profit for the business. We are also informed that Mohave has the excess capacity necessary to accept the order. Hence, no additional fixed costs are incurred in accepting the order, implying that it is overall a profitable transaction for Mohave which it should accept.
The Corporation should accept the special order because the special order will results to a profit of $4,200 for the business.
What is the Variable cost per unit?= Direct materials + Direct labor + Variable manufacturing overhead
= $11 + $6 + $7.5
= $24.5
What is the Incremental profit?= (Sale price per unit - Variable cost per unit) x Units sold
= ($26 - $24.5) x 2,800
= $4,200
In conclusion, the Corporation should accept the special order because the special order will results to a profit of $4,200 for the business.
Read more about Variable cost
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Franco Company uses IFRS and owns property, plant, and equipment with a historical cost of $5,000,000. At December 31, 2016, the company reported a valuation reserve of $690,000. At December 31, 2017, the property, plant, and equipment was appraised at $5,325,000. The valuation reserve will show what balance at December 31, 2017?
Answer:
$325,000
Explanation:
Valuation reserve is the amount added to to an asset to absorb for any future decrease in the value of such asset.
Given:
Real cost of property, plant, and equipment = $5,000,000
Appraised later/future cost = $5,325,000
Valuation reserve= later/future Appraisal cost - Real cost
=$5,325,000 - $5,000,000
=$325,000