Having a license/certification in Quality Management is important as it demonstrates expertise, credibility, and adherence to industry standards.
1. Having a license/certification in Quality Management is essential as it demonstrates a person's competence and understanding of quality principles and methodologies. Certifications like Six Sigma, ISO 9001, or Certified Quality Manager (CQM) validate one's knowledge and expertise in implementing and managing quality systems. These certifications enhance professional credibility, open up career opportunities, and instill confidence in clients and stakeholders.
2. A flowchart is a visual representation that illustrates the steps involved in delivering a quality product or service. It starts with defining customer requirements and specifications, followed by process design, material selection, production or service delivery, and ends with quality testing and customer feedback. The flowchart helps identify potential bottlenecks, areas for improvement, and ensures consistent adherence to quality standards throughout the process.
3. Computers are vital in quality control as they enable efficient data analysis, automate quality monitoring processes, and provide real-time feedback. For example, computerized statistical analysis tools can quickly process large amounts of data, identify trends, and help detect anomalies or variations in product quality. Computer-controlled machinery and sensors can be used to monitor quality parameters during production, ensuring consistent output.
4. Quality Assurance (QA) focuses on preventing defects by implementing processes, standards, and guidelines. It involves planning, documentation, training, and process audits to ensure compliance with quality requirements. On the other hand, Quality Control (QC) involves the inspection, testing, and measurement of products or services to identify defects or deviations from specifications. QC aims to identify and correct issues before the final product is delivered to the customer.
5. Total Quality Management (TQM) is an all-encompassing approach that emphasizes continuous improvement, customer satisfaction, and employee involvement. It involves a cultural shift towards quality consciousness, where every employee is responsible for ensuring and improving quality. TQM emphasizes process optimization, waste reduction, and the involvement of all stakeholders. By implementing TQM principles, businesses can enhance customer loyalty, reduce costs, improve efficiency, and foster innovation, leading to long-term growth and success. Strategies for implementing TQM include employee training, process reengineering, continuous measurement and feedback, and the establishment of quality management systems aligned with organizational goals.
Learn more about Management here: https://brainly.com/question/32216947
#SPJ11
Assume that Theodore Enterprises operates in an industry for which NOK carryback is allowed Theodore Enterprises had the following pretar income tal cover first the years of persons 2019 $ 460,000 2020 (940,000) 1,420,000 2021 For each year there were no detened income taxes and the the rate was 25% is 2020 tax return, Theodore eiected a net coming scaryback Novaluation accoure was deemed necessary for the deemed tax assets of December 21, 2020. What was Theodore's income tax expense for 201 Munipla Chica OOOO O$30.000 $395.000 $325.000
Theodore Enterprises' income tax expense for 2021 would be $120,000.
To calculate Theodore Enterprises' income tax expense for 2021, we need to determine the taxable income for the year and then apply the tax rate of 25%.
Taxable Income for 2021:
Pretax Income for 2021: $1,420,000
Since Theodore Enterprises elected a net operating loss (NOL) carryback from 2020, we need to consider the impact of the NOL on the taxable income for 2021.
NOL Carryback:
Net Operating Loss (NOL) from 2020: ($940,000)
Taxable Income for 2021 (after NOL carryback):
Taxable Income = Pretax Income for 2021 - NOL Carryback
Taxable Income = $1,420,000 - ($940,000)
Taxable Income = $480,000
Now, we can calculate the income tax expense for 2021:
Income Tax Expense:
Taxable Income for 2021: $480,000
Tax Rate: 25%
Income Tax Expense = Taxable Income * Tax Rate
Income Tax Expense = $480,000 * 0.25
Income Tax Expense = $120,000
Therefore, Theodore Enterprises' income tax expense for 2021 would be $120,000.
Learn more about tax from
https://brainly.com/question/30157668
#SPJ11
Which of the following is NOT true?A. Structured interviews involve asking each applicant the same list of pre- prepared questions and comparing their responses to a standardized set of answers. B. Cognitive ability test has a high level of adverse impact. C. Cognitive ability test has a high level of validity. D. Unstructured and structured interviews are equally valid to be used to predict job performance.
The statement that is NOT true is option D. Unstructured and structured interviews are NOT equally valid to be used to predict job performance.
Option A is True - Structured interviews involve asking each applicant the same list of pre-prepared questions and comparing their responses to a standardized set of answers. This method provides consistency in the interview process as well as ease of comparison between candidates.
Option B is False - Cognitive ability tests are designed to assess a candidate's mental capabilities. Such tests are widely used and have been shown to have a high level of validity, meaning they accurately measure intelligence.
Option C is True - Cognitive ability tests have a high level of validity, which is the degree to which the test measures what it claims to measure. This is established through extensive research, allowing employers to make informed hiring decisions.
Option D is False - Unstructured interviews rely more on subjective assessments, resulting in potential interviewer biases and inconsistent results. Structured interviews, on the other hand, are standardized and can minimize the influence of subjective factors on hiring decisions. Therefore, structured interviews have higher validity than unstructured interviews.
The statement NOT true is option D, which states that unstructured and structured interviews are equally valid to be used to predict job performance. Unlike structured interviews, unstructured interviews lack consistency in questions, interpretation, and analysis, making it challenging to compare candidates fairly. Therefore, structured interviews tend to be more valid in predicting job performance than unstructured interviews.
To know more about job performance, visit:
https://brainly.com/question/12957583
#SPJ11
ABN case) Why is the consortium paying more than Barclays for ABN Amro? A B C Synergies are less likely to add up with a diversified consortium than with a single buyer D E F A B C The consortium will pay a larger proportion in shares
The answer to why the consortium is paying more than Barclays for ABN Amro can be option C: Synergies are less likely to add up with a diversified consortium than with a single buyer.
When a consortium is formed, it typically involves multiple parties with diverse interests and strategies. Each member of the consortium may have different goals and priorities, which can make it challenging to fully realize synergies and cost-saving opportunities that a single buyer like Barclays could potentially achieve.
Additionally, coordinating and integrating the operations of multiple companies within a consortium can be complex and time-consuming, which may lead to higher transaction costs and potentially a higher offer price.
It is important to note that the actual reasons for the consortium paying more than Barclays for ABN Amro could be influenced by various factors, including competitive bidding, strategic considerations, regulatory requirements, and the specific dynamics of the deal.
Learn more about consortium here:
https://brainly.com/question/32765097
#SPJ11
A proposed bridge on the interstate highway is being considered at the cost of 15 million dollars. It is expected that the bridge will have a life of 30 years. Construction costs will be paid by government agencies. Operation and maintenance costs are estimated to be $180,000 per year. Benefits to the public are estimated to be $900,000 per year. The building of the bridge will result in an estimated cost of $250,000 per year to the general public. The project requires a return of 5%. Determine the benefit/cost (B/C) ratio.
a. 0.78
b.0.56
c. 0.00
The benefit-cost ratio is greater than 1.The correct answer is not in the options provided for the B/C ratio.
The benefit/cost ratio for a proposed bridge on the interstate highway is being considered. The following are some of the terms to be included in the solution; B/C ratio = Total benefits / Total costsTotal benefits = Estimated benefits per year × YearsTotal benefits = $900,000 × 30
A financial indicator called the Benefit-Cost Ratio (BCR) is used to assess the viability and profitability of a project or venture. It contrasts the present worth of anticipated benefits with estimated expenditures. If the BCR is more than 1, the investment may be justified because the advantages may outweigh the drawbacks. A BCR of 1.5, for instance, denotes a projected return of $1.50 on every dollar invested. Decision-makers can more efficiently prioritise investments and distribute resources by using BCR to evaluate the economic efficiency and attractiveness of various initiatives. A greater BCR denotes a more favourable investment opportunity, whereas a BCR of less than 1 indicates that the risks outweigh the potential rewards.
Total benefits = $27,000,000Total costs = Construction costs + Total operation and maintenance costsTotal costs = $15,000,000 + Total operation and maintenance costsTotal costs = $15,000,000 + ($180,000 × 30)Total costs = $21,300,000$250,000 per year to the general public is an additional cost for the project.
The B/C ratio will be:$27,000,000 / $21,300,000+$250,000=1.266, which is greater than 1.
So, the benefit-cost ratio is greater than 1.The correct answer is not in the options provided.
Learn more about B/C ratio here:
https://brainly.com/question/32070111
#SPJ11
"Based on your identification of the current market conditions, please explain to us which assets should be overweighted and which asset(s) should be underweighted to take advantage of the market conditions.
To identify which assets should be overweighted and which asset(s) should be underweighted to take advantage of the market conditions, it is important to consider the current market trends and the potential risks and opportunities associated with them.
Here are some possible asset classes that could be overweighted or underweighted based on the market conditions:
Overweighted assets:Technology stocks: The technology sector has shown a strong performance in recent years and is expected to continue growing in the future due to the increasing adoption of digital technologies. Companies that provide innovative solutions for cloud computing, big data analytics, artificial intelligence, cybersecurity, and e-commerce are likely to benefit from the trend.
Growth stocks: Growth stocks are companies that have a high potential for future earnings growth, usually due to their innovative business models, competitive advantages, or expanding markets. Growth stocks typically have higher valuations and lower dividends than value stocks, but they also offer higher growth potential and capital appreciation opportunities.
Underweight Assets - Bonds: Bonds are fixed-income securities that provide a steady stream of income but offer lower returns than equities in the long run. With interest rates at historic lows, bond yields are also low, which means that bond prices are unlikely to appreciate significantly in the future.
Moreover, if interest rates rise in the future, bond prices may decline, which would negatively affect the total return of bond portfolios.
Value stocks: Value stocks are companies that are undervalued by the market, usually due to temporary setbacks, cyclical downturns, or industry challenges. Value stocks typically have lower valuations and higher dividends than growth stocks, but they also offer lower growth potential and capital appreciation opportunities.
In the current market conditions, value stocks may face headwinds due to the slower economic growth, higher inflation, and weaker consumer demand caused by the pandemic.
Overweighted assets : A portfolio that is overweight has an excessive stake in a particular asset, asset type, or industry. An analyst's opinion that a particular stock will outperform its sector average over the next eight to twelve months is also reflected in the term "overweight," rather than "equal weight" or "underweight."
Know more about Overweighted assets
https://brainly.com/question/31423409
#SPJ11
Calculate the marketing expense variance, if the actual marketing expense and marketing expenses estimated in the plan are $98,000 and $80,000, respectively. The actual percentage of sales is 15%.a. $270,000. b. $2,700. c. $18,000. d. $1,800. e. $27,000
Marketing expense refers to the costs incurred by a business or organization in promoting and advertising its products or services to customers.
It includes expenses related to advertising campaigns, market research, sales promotions, public relations, and other marketing activities.
To calculate the marketing expense variance, you need to find the difference between the actual marketing expense and the marketing expense estimated in the plan.
Here's the calculation:
Actual Marketing Expense: $98,000
Marketing Expense Estimated in the Plan: $80,000
Marketing Expense Variance = Actual Marketing Expense - Marketing Expense Estimated in the Plan
= $98,000 - $80,000
= $18,000
Therefore, the marketing expense variance is $18,000. The correct answer is option c. $18,000.
Marketing expense refers to the costs incurred by a business or organization in promoting and advertising its products or services to customers.
Learn more about Marketing expense here:
https://brainly.com/question/13751644
#JSP11
The Trailer division of Baxter Bicycles makes bike trailers that attach to bicycles and can carry children or cargo. The trailers have a market price of $94 each. Each trailer incurs $38 of variable manufacturing costs. The Trailer division has capacity for 21,000 trailers per year and has fixed costs of $520,000 per year. 1. Assume the Assembly division of Baxter Bicycles wants to buy 5,400 trailers per year from the Trailer division. If the Trailer division can sell all of the trailers it manufactures to outside customers (and has no excess capacity), what price should be used on transfers between divisions? 2. Assume the Trailer division currently only sells 9,600 trailers to outside customers and has excess capacity. The Assembly division wants to buy 5,400 trailers per year from the Trailer division. What is the range of acceptable prices on transfers between divisions? 1. Transfer price per trailer 2. Transfer price per trailer will be at least but not more than
The range of acceptable prices on transfers between divisions is $38 to $56 per trailer. The transfer price per trailer should be at least $38 but not more than $56 to ensure that the Trailer division does not incur a loss and the Assembly division does not pay more than the external market price.
If the Trailer division can sell all of the trailers it manufactures to outside customers and has no excess capacity, the price on transfers between divisions should be based on the market price of $94 per trailer. This ensures that the Assembly division is charged the same price as external customers and promotes fairness within the company.
In this scenario, the Trailer division has excess capacity and the Assembly division wants to buy 5,400 trailers per year. The range of acceptable prices on transfers between divisions can be determined based on the variable manufacturing costs and the opportunity cost.
The variable manufacturing costs per trailer are $38. This represents the additional cost incurred by the Trailer division to produce one additional trailer.
The opportunity cost is the potential revenue the Trailer division could earn by selling the trailers to external customers instead of transferring them to the Assembly division. Currently, the Trailer division sells 9,600 trailers to external customers, leaving a capacity of 21,000 - 9,600 = 11,400 trailers per year.
To calculate the range of acceptable prices:
Lower Bound: Variable Manufacturing Cost per Trailer
Transfer Price per Trailer (Lower Bound) = $38
Upper Bound: Opportunity Cost per Trailer
Opportunity Cost per Trailer = (Market Price - Variable Manufacturing Cost per Trailer)
Opportunity Cost per Trailer = ($94 - $38) = $56
Therefore, the range of acceptable prices on transfers between divisions is $38 to $56 per trailer. The transfer price per trailer should be at least $38 but not more than $56 to ensure that the Trailer division does not incur a loss and the Assembly division does not pay more than the external market price.
learn more about prices here
https://brainly.com/question/20703640
#SPJ11
the key concepts in patent law are originality, novelty, and value.
true or false
The statement "the key concepts in patent law are originality, novelty, and value" is true.
Patent law is a type of intellectual property law that governs the granting of patents for original and useful inventions. The key concepts in patent law are originality, novelty, and value. In order to be granted a patent, an invention must be original, meaning that it is not obvious and has not been previously invented or published.
It must also be novel, meaning that it is not identical or substantially similar to anything that has been previously invented or published. Finally, it must have value, meaning that it is useful and has a practical application. These concepts are essential to the patent system as they help ensure that only truly new and useful inventions are granted patents, which promotes innovation and progress in society.
Know more about patent law here:
https://brainly.com/question/29738132
#SPJ11
Which type of industry has a horizontal long-run supply curve? a) a constant cost industry. b) an increasing cost industry. c) a decreasing cost industry. d) a perfectly competitive industry. e) all industries face a horizontal long-run supply curve
The type of industry that has a horizontal long-run supply curve is perfectly competitive industry. Perfectly competitive industries have the characteristics of many buyers and sellers of the same good.
With no barriers to entry or exit from the industry, and perfect information about the price and quality of the good being sold. This results in a horizontal long-run supply curve.The horizontal long-run supply curve implies that any change in demand will have no effect on the price of the good in the long run.
Instead, any change in demand will be met by an equivalent change in the quantity supplied by firms in the industry. This is because there are many firms in the industry, and each firm is too small to influence the market price.Therefore, option (d) is the correct answer.
To know more about Perfectly visit:
https://brainly.com/question/32253850
#SPJ11
Waller Co. paid a $0.156 dividend per share in 2000, which grew to $0.342 in 2012. This growth is expected to continue. What is the value of this stock at the beginning of 2013 when the required return is 15.6 percent? (Round the growth rate, g, to 4 decimal places. Round your final answer to 2 decimal places.)
$2.08 is the value of this stock at the beginning of 2013 when the required return is 15.6 percent. To calculate the value of the stock at the beginning of 2013, we can use the Gordon Growth Model (also known as the Dividend Discount Model).
The formula is as follows:
Dividends are equal to (Required Return - Growth Rate) / Stock Value.
Dividend in 2000 (D0) = $0.156
Dividend in 2012 (D1) = $0.342
Required Return (r) = 15.6% or 0.156 (in decimal form)
We can apply the algorithm to determine the growth rate (g):
g = (D1 - D0) / D0
Substituting the given values:
g = ($0.342 - $0.156) / $0.156 = 1.1923 (rounded to 4 decimal places)
Now we can calculate the stock value:
Stock Value = $0.342 / (0.156 - 0.0119) ≈ $2.08 (rounded to 2 decimal places)
Therefore, the value of the stock at the beginning of 2013, when the required return is 15.6 percent, is approximately $2.08.
For more questions on: Gordon Growth Model
https://brainly.com/question/28945194
#SPJ8
Question 34 (04.05 MC) How does inflation influence the interest rate and the demand for money in the economy? When prices fall, the interest rate is also expected to fall, and the demand for money decreases. When prices fall, the interest rate is expected to rise, and the demand for money is unaffected. When prices rise, the interest rate is also expected to rise, and the demand for money increases. When prices rise, the interest rate is expected to fall, and the demand for money is unaffected. O When prices rise, the interest rate is expected to fall, and the demand for money increases. 1 pts
Inflation leads to higher interest rates and increased demand for money due to the eroding purchasing power of currency and the need for more money to cover rising prices.
Inflation, which refers to a general increase in prices of goods and services over time, has an impact on both interest rates and the demand for money in an economy. When prices rise, the interest rate is also expected to rise. This is because inflation erodes the purchasing power of money, and lenders require higher interest rates to compensate for the anticipated loss in the value of money over time. As a result, borrowers face higher borrowing costs.
Furthermore, when prices rise, the demand for money increases. This occurs because individuals and businesses need more money to purchase the same amount of goods and services. As the general price level rises, people require a larger quantity of money to maintain their purchasing power and cover their expenses. Therefore, the demand for money increases to accommodate the higher prices and the increased transactions in the economy. Hence, inflation has a direct influence on the interest rate, which tends to rise as prices increase. Additionally, inflation leads to an increase in the demand for money as individuals and businesses require more money to sustain their purchasing power in the face of higher prices.
Learn more about inflation here:
brainly.com/question/32716142
#SPJ11
The term refusal rate refers to the number of people who
A. choose not to participate in a telephone interview.
B. are part of a double-blind experiment.
C. participate in the control group of an experiment.
D. can't be contacted through a telephone interview
The term refusal rate refers to the number of people who choose not to participate in a telephone interview. Therefore, the correct option would be option A.
The term "refusal rate" refers to the percentage of individuals who decline to participate in a study. This can be attributed to a number of factors, including a lack of interest in the topic, a lack of time, or personal privacy concerns. This is a critical statistic to consider when evaluating the quality and accuracy of a study, since a high refusal rate may suggest that the study's findings are less representative of the population being studied.
It indicates the percentage of individuals who decline or refuse to participate in the interview, or who cannot be reached due to various reasons such as incorrect contact information, unavailability, or lack of cooperation.
To learn more about refusal rate, visit:
https://brainly.com/question/31501307
#SPJ11
One of virtual management successful factors is the Virtual manager's knowledge of what virtual employees want from him/her such as ......
A-Defining their roles and responsibilities clearly
B-Giving them absolute freedom in working
C-Having long communication with them
D-Giving them more bonuses
Virtual management is the management of virtual or remote workers by a manager who is in a different location. It can be a daunting task for some managers who are accustomed to managing in-person teams. However, it can also be a very successful and efficient way of managing a team if certain factors are taken into consideration.
One of the most critical success factors of virtual management is the virtual manager's understanding of what virtual employees want from him/her. Virtual employees have different expectations from their virtual manager than their in-person counterparts. It is essential to understand what these expectations are to effectively manage virtual employees.
There are several things that virtual employees want from their virtual manager, such as:Regular and clear communication: One of the most important things that virtual employees want from their virtual manager is regular and clear communication. Virtual employees do not have the luxury of being in the same location as their manager, so it is important for the virtual manager to communicate with them regularly and clearly.
This communication can take the form of emails, video conferencing, phone calls, or instant messaging. Whatever form it takes, it is critical that the communication is regular and clear.Flexibility: Virtual employees want their virtual manager to be flexible. They want to be able to work on their own schedule and in their own way. A virtual manager who is too rigid in his/her approach to managing virtual employees will not be successful.
Trust: Virtual employees want to be trusted by their virtual manager. They want to know that their manager believes in them and their abilities. A virtual manager who micromanages his/her virtual employees will not be successful. Instead, the virtual manager should trust his/her employees to do their job.Bonuses: Giving virtual employees more bonuses can be a way to motivate and engage them. Bonuses can take different forms such as monetary, time-off, or other perks. A virtual manager who understands the importance of bonuses and incentives can use them to motivate and retain virtual employees.
to know more about Virtual management pls visit-
https://brainly.com/question/31711466
#SPJ11
Backflush costing is an example of a sequential tracking system in which the journal entries follow the physical movement of the product through various stages of production.
a) True
b) False
The statement is True. Backflush costing is indeed an example of a sequential tracking system in which the journal entries follow the physical movement of the product through various stages of production.
Backflush costing is a cost accounting method used in lean manufacturing environments. It eliminates the need for detailed tracking of individual components and instead uses predetermined "backflush triggers" to allocate costs to products. The triggers are usually related to the completion of certain production stages or the sale of finished goods. Journal entries are then made based on these triggers, following the physical movement of the product through the production process. This sequential tracking system simplifies the accounting process and reduces paperwork by delaying the recording of costs until specific milestones are reached.
Learn more about Backflush costing here:
https://brainly.com/question/20597435
#SPJ11
please show all work, thank you in advance! 7) (35 points) EmKay, Inc. is considering an investment in a new production equipment to boost its revenue. For this new investment, the following data apply: Purchase price=$900,000 {$360,000 from company funds and $540,000 from a loan} Useful Life:4 years Depreciation: MACRS-GDS 3-year property Estimated salvage: $90,000 Effective tax rate: 35% Estimated annual O&M costs:$48,000Estimated new annual revenue: $360,000 Conditions on loan: Nominal annual rate of 5% per year compounded annually. The loan is to be repaid over 3 years with equal annual payments. a) Loan calculations - principal and interest payments. (Round off values to the nearest dollar) b) Find the ATCF for each year of this investment (Round off values to the nearest dollar) EOY BT&LCF Loan Principal Payment Loan Interest Payment MACRS- GDS Deduction Taxable Income Tax ATCF 0 2 3
Answer:
The specific values for depreciation, tax, and salvage value will depend on the MACRS-GDS 3-year property schedule and the effective tax rate provided.
a) Loan calculations - principal and interest payments:
The loan amount is $540,000, and it is to be repaid over 3 years with equal annual payments. To calculate the principal and interest payments, we can use the formula for an amortizing loan. The formula is:
Payment = Loan Amount / Present Value Factor
First, we need to calculate the present value factor using the loan terms. The nominal annual interest rate is 5%, compounded annually. Since the loan is to be repaid over 3 years, the present value factor can be calculated as follows:
Present Value Factor = (1 - (1 + interest rate)^(-number of periods)) / interest rate
Present Value Factor = (1 - (1 + 0.05)^(-3)) / 0.05
Present Value Factor ≈ 2.723
Now we can calculate the annual payment:
Loan Principal Payment = Loan Amount / Present Value Factor
Loan Principal Payment = $540,000 / 2.723
Loan Principal Payment ≈ $198,348
To calculate the interest payment, we can subtract the principal payment from the total loan amount:
Loan Interest Payment = Loan Amount - Loan Principal Payment
Loan Interest Payment = $540,000 - $198,348
Loan Interest Payment ≈ $341,652
Therefore, the principal payment for each year is approximately $198,348, and the interest payment for each year is approximately $341,652.
b) ATCF (After-Tax Cash Flow) for each year of the investment:
To calculate the ATCF for each year, we need to consider the depreciation, O&M costs, and taxes.
Year 0:
ATCF0 = -Purchase Price + Loan Principal Payment - O&M costs
ATCF0 = -$900,000 + $198,348 - $48,000
ATCF0 ≈ -$749,652
Year 1:
Depreciation for Year 1 can be calculated using the MACRS-GDS 3-year property schedule. Let's assume it is $X.
Taxable Income = New Annual Revenue - O&M costs - Depreciation
Tax = Taxable Income * Effective Tax Rate
ATCF1 = New Annual Revenue - O&M costs - Tax - Loan Principal Payment
ATCF1 = $360,000 - $48,000 - Tax - $198,348
Year 2:
Depreciation for Year 2 can be calculated using the MACRS-GDS 3-year property schedule. Let's assume it is $Y.
Taxable Income = New Annual Revenue - O&M costs - Depreciation
Tax = Taxable Income * Effective Tax Rate
ATCF2 = New Annual Revenue - O&M costs - Tax - Loan Principal Payment
ATCF2 = $360,000 - $48,000 - Tax - $198,348
Year 3:
Depreciation for Year 3 can be calculated using the MACRS-GDS 3-year property schedule. Let's assume it is $Z.
Taxable Income = New Annual Revenue - O&M costs - Depreciation
Tax = Taxable Income * Effective Tax Rate
ATCF3 = New Annual Revenue - O&M costs - Tax - Loan Principal Payment + Salvage Value
ATCF3 = $360,000 - $48,000 - Tax - $198,348 + $90,000
It is important to note that the specific values for depreciation, tax, and salvage value will depend on the MACRS-GDS 3-year property schedule and the effective tax rate provided. These values need to be calculated based on the specific schedule and rate.
Learn more about salvage value from below link
https://brainly.com/question/31441389
#SPJ11
(A) There is an annual payment of $180,000 and a $27,000 interest payment. (B) As a result, the ATCF is as follows for each year of the investment: EOY 0 was negative $31,200, EOY 1 was $307,800, EOY 2 was $342,817.50, EOY 3 was $249,311.50, and EOY 4 was $226,546.50.
The calculation is as follows:
(A) Calculate the yearly interest payment in Step 1:
Loan amount * Nominal annual rate equals the yearly interest payment.
$540,000 multiplied by 5% to equal $27,000 per year in interest.
Calculate the yearly principal payment in Step 2:
Annual principle payment equals Loan duration / Loan amount
An annual principle payment of $180,000 ($540,000 divided by three)
(B) Using the following formula, we'll get the ATCF for each year of the investment: ATCF is equal to (Revenue – O&M Expenses – Depreciation) (Tax rate - 1) plus depreciation
ATCF0 = (0 - 48,000 - 0) * (1 - 0.35 + 0) for EOY 0; ATCF0 = -48,000 * 0.65 for EOY 0; ATCF0 = $31,200.
EOY 1: Depreciation: To determine the depreciation expenditure, we'll utilize the MACRS-GDS 3-year property approach. According to this procedure, the first year is assigned the proportion 33.33%, the second year, 44.45%, the third year, 14.81%, and the fourth year, 7.41%.
Purchase price + Depreciation1 Year 1 depreciation preciation1: $300,000 ($900,000 x 33.33%)
Revenue minus operating and maintenance expenses minus depreciation equals taxable income.
$360,000 - $48,000 - $300,000 = $12,000 is the taxable income1.
ATCF1 = (1 - Tax rate) + (Revenue - O&M expenses - Depreciation1)
ATCF1 = ($360,000 - $48,000 - $300,000) * (1 - 0.35) + $300,000
ATCF1 = $12,000 * 0.65 + $300,000
ATCF1 = $7,800 + $300,000
ATCF1 = $307,800
Learn more about annual payment, from :
brainly.com/question/33098723
#SPJ4
An estimated 80% increase in the retail price of cigarettes is necessary to cause a 30% drop in the number of cigarettes sold. Would such a price increase help or hurt the tobacco industry’s profits? What would be the likely effect on industry profits if this price boost was simply caused by a $1.50 per pack increase in cigarette excise taxes?
Yes, a price increase of 80% in the retail price of cigarettes would hurt the tobacco industry's profits. The likely effect on industry profits if this price boost was simply caused by a $1.50 per pack increase in cigarette excise taxes is a decrease in industry profits. The elasticity of demand for cigarettes refers to the degree to which a shift in price affects the number of cigarettes sold.
The formula for the price elasticity of demand (PED) is expressed as:(% Change in Quantity Demanded) / (% Change in Price)A negative value indicates that as the price rises, the quantity demanded falls, whereas a positive value indicates that as the price rises, the quantity demanded rises. When the value is zero, it means that the quantity demanded is not influenced by price. The PED for cigarettes is likely to be very high, implying that a slight change in price can lead to a significant shift in the number of cigarettes sold. This means that a 30% reduction in demand for cigarettes would necessitate a substantial increase in price, around 80%.A price increase of 80% in the retail price of cigarettes would hurt the tobacco industry's profits. The likely effect on industry profits if this price boost was simply caused by a $1.50 per pack increase in cigarette excise taxes is a decrease in industry profits. This increase in excise taxes would be passed on to the consumer in the form of a price increase. Because the cost of cigarettes would increase, the demand for them would decrease, which would result in a drop in the quantity sold and a decrease in the tobacco industry's profits.
To know more about cigarettes visit:
https://brainly.com/question/13620453
#SPJ11
Henderson's Hardware has an ROA of 12%, a 6.5% profit margin, and an ROE of 20%.
What is its total assets turnover? Do not round intermediate calculations. Round your answer to two decimal places.
What is its equity multiplier? Do not round intermediate calculations. Round your answer to two decimal places.
Therefore, the main answer is the calculated value of the total assets turnover and the equity multiplier, rounded to two decimal places.
To calculate the total assets turnover, we can use the formula:
Total Assets Turnover = Net Sales / Average Total Assets
Given that the profit margin is 6.5%, we can calculate the net sales by dividing the profit margin by the profit margin ratio:
Net Sales = Profit Margin / Profit Margin Ratio
Profit Margin Ratio = Net Income / Net Sales
Using the ROA of 12%, we can calculate the net income by multiplying the ROA by the average total assets:
Net Income = ROA * Average Total Assets
Plugging these values into the formulas, we can calculate the total assets turnover.
The equity multiplier can be calculated using the formula:
Equity Multiplier = Total Assets / Average Total Equity
Using the ROE of 20%, we can calculate the average total equity by dividing the net income by the ROE: Average Total Equity = Net Income / ROE Plugging in the values, we can calculate the equity multiplier.
Therefore, the main answer is the calculated value of the total assets turnover and the equity multiplier, rounded to two decimal places.
In this case, the total assets turnover is calculated to be X, and the equity multiplier is calculated to be Y. The total assets turnover measures a company's efficiency in utilizing its assets to generate sales. A higher turnover indicates that the company is effectively using its assets to generate revenue. In this case, the calculated value of the total assets turnover is X, rounded to two decimal places. The equity multiplier measures the amount of debt used to finance a company's assets. A higher multiplier indicates a higher level of debt relative to equity. In this case, the calculated value of the equity multiplier is Y, rounded to two decimal places. Both metrics provide insights into the company's financial performance and can be useful for analyzing its efficiency and capital structure.
learn more about value here:
https://brainly.com/question/13492123
#SPJ11
Bluepanda Inc. sales electronics parts, which finds application in various equipment used mainly in construction industry. The company has faced some issues in managing its working capital and has lost some key suppliers in the recent past due to mismanagement of cash and delay in vendor payments. Bluepanda has hired you as a financial consultant to look into this matter and provide a comprehensive perspective. The management also desired to maintain a cash balance of more than $15,000 each month as financial prudence. After considering all the information provided to you, you decided that having a cash budget would be the first step to understand the shortfall/surplus of cash and will aid in working capital management. You arranged a meeting with the marketing team and gathered the following information: Sales Forecast Month- year Sales Nov. 2022 $50,000 Dec 2022 $60,000 Jan 2023 $60,000 Feb 2023 $70,000 March 2023 $75,000 April 2023 $80,000 The accounts management team provided the following information: 80% of revenue is on a cash basis. 20% is collected after 30 days. Cost of sales, which is 50% of revenue, is incurred in the month in which the sales are made. These goods are paid for 30 (1 month) days after the purchases are made. Monthly selling and administrative expenses are as follows: Wages $12,000 Financing Cost $2,500 Rental Cost $800 Depreciation $3,000 Communication and Promotion expense $1,000 Provision for future losses $2,000 Other budgeted expenses are as follows: Taxes: $10,000 in February, $10,000 in April, and $10,000 in September Purchase of assets: $3,000 in January, $12,000 in February, $20,000 in March, and $3,000 in April Cash balance on January 1, 2023, is $3,000 Use the above information to complete the following tasks: Prepare a cash budget for the months of January 2022, February 2022, March 2022 and April 2022. Based on the cash budget, provide recommendation to the management of Bluepanda on cash management and any suggestions to improve cash management. Provide comments on their ability to maintain the desired cash balance of $15,000 each month.
The cash budget helps Bluepanda understand their cash position each month. Recommendations for cash management may include improving collections, reducing expenses, and carefully monitoring cash flow to maintain the desired cash balance of $15,000 each month.
To prepare the cash budget, we need to analyze the cash inflows and outflows for each month and calculate the ending cash balance. Here are the steps to prepare the cash budget for January, February, March, and April 2023:
1. Calculate Cash Inflows:
Cash sales: 80% of revenue for the month.
Collections from credit sales made in the previous month: 20% of revenue from the previous month.
2. Calculate Cash Outflows:
Cost of sales: 50% of revenue for the month.
Selling and administrative expenses: Sum of wages, financing cost, rental cost, depreciation, communication and promotion expense, and provision for future losses.
Taxes: $10,000 in February, $10,000 in April, and $10,000 in September.
Purchase of assets: $3,000 in January, $12,000 in February, $20,000 in March, and $3,000 in April.
3. Determine the Ending Cash Balance:
Starting cash balance: $3,000 on January 1, 2023.
Ending cash balance = Starting cash balance + Cash inflows - Cash outflows.
Based on the cash budget, you can analyze the cash position for each month. If the ending cash balance is higher than $15,000, it indicates a surplus of cash, which can be used to invest or pay off debts. If the ending cash balance is lower than $15,000, it indicates a shortfall of cash, and management should consider measures like improving collections, reducing expenses, or arranging short-term financing.
Learn more About cash management from the given link
https://brainly.com/question/30408146
#SPJ11
Which type of audit is the least complicated for taxpayers?a. A field audit
b. An office audit
c. A research audit
d. A correspondence audit
e. A documentation audit
d. A correspondence audit
Among the options listed, a correspondence audit is typically the least complicated for taxpayers. In a correspondence audit, the tax authority communicates with the taxpayer through mail or electronic correspondence, requesting specific documents or information related to their tax return. The taxpayer is usually required to provide the requested documentation or clarification on certain items. It is generally less intrusive and time-consuming compared to other types of audits
In contrast, field audits involve in-person visits by tax auditors to the taxpayer's premises or business location, which can be more involved and comprehensive. Office audits take place at the tax authority's office and may require the taxpayer to bring their records for examination. Research audits are less common and typically involve more complex situations or specific issues. Documentation audits focus on verifying the supporting documents and records provided by the taxpayer.
It's important to note that the complexity of an audit may vary depending on the specific circumstances, the complexity of the taxpayer's financial situation, and the scope of the audit.
Learn more about taxpayers here:
https://brainly.com/question/30049579
#SPJ11
Which of the following would most likely foster more entrepreneurship?
Several factors can foster more entrepreneurship. These factors may vary from region to region and from person to person.An enabling environment that includes access to credit, good infrastructure, and a stable regulatory framework can foster more entrepreneurship.
However, based on the available options, one of the most significant factors that can foster more entrepreneurship is an enabling environment, including access to credit, good infrastructure, and a stable regulatory framework.The critical factors that can foster more entrepreneurship are as follows:
Access to Credit: Access to credit is essential for businesses to operate. Entrepreneurs need funds to start a business or expand an existing one. Lack of access to credit is a major obstacle that can limit the growth and development of a business. Therefore, an enabling environment that facilitates easy access to credit is crucial for fostering more entrepreneurship.
Good Infrastructure: Entrepreneurs need good infrastructure to operate their businesses. Good infrastructure includes reliable electricity, transportation, communication, and other essential services. The presence of good infrastructure can help entrepreneurs to start and grow their businesses.
Regulatory Framework: A stable regulatory framework is also crucial for fostering more entrepreneurship. Entrepreneurs need to be able to operate their businesses without the fear of arbitrary regulations or political interference. An enabling regulatory framework can create a level playing field for businesses and help to foster innovation and entrepreneurship.
To sum up, an enabling environment that includes access to credit, good infrastructure, and a stable regulatory framework can foster more entrepreneurship. These factors can create a supportive environment that encourages entrepreneurs to start and grow their businesses.
Learn more about Infrastructure here,https://brainly.com/question/869476
#SPJ11
(T/F) Online trading is the only valuable investment service available through the Internet.
False. Online trading is not the only valuable investment service available through the internet.
Other valuable investment services available through the internet include robo-advisors, peer-to-peer lending platforms, crowdfunding, real estate investment platforms, and so on.
Robo-advisors: A robo-advisor is an online investment management platform that offers investment advice based on algorithms and data.
Peer-to-peer lending platforms: These are online platforms that connect investors with borrowers directly, bypassing traditional financial institutions such as banks.
Crowdfunding: Crowdfunding is an online platform that enables entrepreneurs, startups, and businesses to raise capital from a large pool of investors.
Real estate investment platforms: These are online platforms that allow investors to invest in real estate properties, such as apartments, commercial buildings, and other types of properties.
So, the correct answer is False. Online trading is not the only valuable investment service available through the internet.
Learn more about robo-advisor here,
https://brainly.com/question/30378249
#SPJ11
Explain the factors management would need to consider,
in addition to the financial factors, before making a final
decision on a project.
Management needs to consider factors such as strategic alignment, operational impact, risk assessment, stakeholder consideration, ethical responsibility, resource allocation, and implementation planning when making a final decision on a project, in addition to financial factors.
When making a final decision on a project, management needs to consider various factors beyond just financial aspects. Here are the key factors they should take into account:
1. Strategic Alignment: The project should align with the organization's overall strategic goals and objectives. It should contribute to the long-term growth, competitiveness, and sustainability of the company.
2. Operational Impact: Management should evaluate how the project will affect day-to-day operations, existing resources, and the overall efficiency of the organization. This includes assessing any potential disruptions, changes in workflows, or additional training requirements.
3. Risk Assessment: A thorough analysis of potential risks and uncertainties associated with the project should be conducted. This includes considering factors such as market conditions, technological changes, legal and regulatory compliance, and competitive landscape. Mitigation strategies should be developed to address identified risks.
4. Stakeholder Consideration: Management should identify and evaluate the impact of the project on various stakeholders, including employees, customers, suppliers, and the community. Stakeholder engagement and communication are crucial for successful project implementation.
5. Ethical and Social Responsibility: The project should adhere to ethical standards and align with the organization's social responsibility commitments. Considerations should be given to environmental sustainability, social impact, and corporate governance.
6. Resource Allocation: Management needs to assess the availability and allocation of resources required for the project, including personnel, technology, infrastructure, and financial resources. It should consider the opportunity cost of investing in the project and evaluate trade-offs with other potential projects or initiatives.
7. Implementation Plan: A detailed plan for project implementation, including timelines, milestones, and resource requirements, should be developed. Management should assess the feasibility of executing the plan effectively and consider the potential challenges and contingencies.
By considering these factors alongside the financial aspects, management can make informed decisions that take into account the broader implications and maximize the success of the project.
Learn more About Management from the given link
https://brainly.com/question/28072798
#SPJ11
Assume a good has a demand schedule Qd=32−2p This firm faces a total cost schedule of TC=4q. Find the profit maximizing Quantity and price.
To find the profit-maximizing quantity and price, we need to analyze the demand schedule and total cost schedule. The demand equation is Qd = 32 - 2p, and the total cost equation is TC = 4q. The goal is to determine the quantity and price at which the firm can maximize its profit.
To find the profit-maximizing quantity and price, we need to determine the point where marginal revenue (MR) equals marginal cost (MC). Marginal revenue is the change in total revenue when one additional unit is sold, and marginal cost is the change in total cost when one additional unit is produced.
The total revenue (TR) is calculated by multiplying the quantity (q) by the price (p), so TR = qp. The marginal revenue is the derivative of the total revenue with respect to quantity, which is MR = d(TR)/dq = p - 2q.
The marginal cost (MC) is the derivative of the total cost with respect to quantity, which is MC = d(TC)/dq = 4.
To find the profit-maximizing quantity, we equate MR and MC: p - 2q = 4.
Next, we substitute the demand equation into the equation above: p - 2(32 - 2p) = 4.
Simplifying the equation, we get: p - 64 + 4p = 4.
Combining like terms, we have: 5p = 68.
Solving for p, we find: p = 13.6.
Substituting the value of p into the demand equation, we get: Qd = 32 - 2(13.6) = 32 - 27.2 = 4.8.
Therefore, the profit-maximizing quantity is 4.8 units, and the price is $13.6 per unit.
know more about profit-maximizing :brainly.com/question/29894118
#SPJ11
A summary of the time tickets for the current month follows: Job No. Amount 100 $2,100 101 1,740 104 3,190 108 3,610 Indirect labor 11,190 111 2,200 115 1,440 117 9,780 Journalize the entry to record the factory labor costs.
To record the factory labor costs, we need to debit the appropriate accounts and credit the corresponding accounts. Here is the journal entry:
Date: [Date of the entry]
Debit:
Factory Labor Expense $[Total labor cost]
Indirect Labor Expense $[Indirect labor cost]
Credit:
Accrued Factory Labor $[Total labor cost]
Explanation:
The debit to Factory Labor Expense represents the direct labor costs for the specific jobs mentioned in the time tickets (Job No. 100, 101, 104, 108, 111, 115, and 117). The debit to Indirect Labor Expense represents the cost of indirect labor. The credit to Accrued Factory Labor represents the liability for the total labor costs incurred.
Please note that the amounts provided in the question are not specified for each individual job, but rather given in total. Therefore, the specific amounts for each job are not allocated in this journal entry.
Learn more about cost from
https://brainly.com/question/30923321
#SPJ11
To decide the vocabulary and the complexity of a message, one must know the of the audience. expectations education level financial position family background In the context of the various roles employees take up in an organization, who among the following are least likely to spend most of their time listening? Senior executives Hourly employecs Managers Salespeopie Hahn, an associate manager at an engineering research company, wants to start a new project and needs funds from his seniors. However, his seniors think he is not responsible enough to handle either the funds or the amount of work. They assume that he is a carefree individual with a relaxed attitude toward work. Therefore, they reject his request. In the given scenario, Hahn is most likely facing. to communication. language barriers organizational barriers - physical barriers perceptual barriers
1. To decide the vocabulary and complexity of a message, one must know the: education level.
2. Among the following roles in an organization, salespeople are least likely to spend most of their time listening.
3. In the given scenario, Hahn is most likely facing organizational barriers.
1. When determining the vocabulary and complexity of a message, understanding the education level of the audience is crucial. It helps tailor the message to ensure effective communication and comprehension.
2. Salespeople typically focus more on active communication with customers and promoting products or services. Their role involves speaking and persuading, rather than primarily listening.
3. In Hahn's case, his request for funds and support for a new project is rejected based on assumptions about his responsibility and work attitude. This indicates the presence of organizational barriers that hinder effective communication and collaboration within the company.
learn more about organization here:
https://brainly.com/question/12825206
#SPJ11
Office salaries 66,838 Rent 10,400 Office lighting and heating 8,840 Depreciation expense: Works machinery 20,400 Office equipment 4,600 Sales 637,244 Factory fuel and power 16,240 Rent is to be apportioned: Factory 34; Office %4. Inventory at 31 December 2020 was: Raw materials 57,800; Work-in-progress 49,200; Finished goods 57, 692. What is the production cost of goods completed?
the production cost of goods completed is $112,734. This represents the total cost incurred in the production process, excluding the costs of raw materials, work-in-progress, and finished goods inventory at the end of the period.
To calculate the production cost of goods completed, we need to consider the relevant expenses incurred in the production process. These expenses typically include direct materials, direct labor, and manufacturing overhead costs.
Given the information provided, we can identify the following relevant expenses:
Office salaries: $66,838
Rent (apportioned to factory): $416 (10,400 x 4%)
Office lighting and heating: $8,840
Depreciation expense (works machinery): $20,400
Factory fuel and power: $16,240
To calculate the production cost of goods completed, we sum up these expenses:
Production Cost = Direct Expenses + Indirect Expenses
Direct Expenses:
Rent (apportioned to factory): $416
Indirect Expenses:
Office salaries: $66,838
Office lighting and heating: $8,840
Depreciation expense (works machinery): $20,400
Factory fuel and power: $16,240
Total Indirect Expenses = $66,838 + $8,840 + $20,400 + $16,240 = $112,318
Production Cost = $416 + $112,318 = $112,734
Therefore, the production cost of goods completed is $112,734. This represents the total cost incurred in the production process, excluding the costs of raw materials, work-in-progress, and finished goods inventory at the end of the period.
Learn more about Rent here :
https://brainly.com/question/31328486
#SPJ11
Explain the meaning of fiscal policy.
Discuss how this policy can affect the current economic situation.
Do you think it is important to implement this policy in the current times? Explain why or why not.
Fiscal policy refers to the use of government spending, taxation, and borrowing to influence the economy. The main goal of fiscal policy is to achieve full employment, price stability, and economic growth.
In other words, the government uses its power to regulate the economy by adjusting its spending, taxation, and borrowing policies. Fiscal policy can affect the current economic situation in several ways.
Firstly, government spending can boost the economy by increasing demand for goods and services, creating jobs, and stimulating economic growth. This is particularly useful during a recession or times of high unemployment. Secondly, taxes can be used to reduce inflation by reducing demand for goods and services.
To know more about government visit:
https://brainly.com/question/4160287
#SPJ11
In the year of 2019, the state of Connecticut has a total disposable income of $40 billion and total consumption of $40 billion. In the year of 2020, the state of Connecticut has a total disposable income of $50 billion and total consumption of $47.5 billion.
If planned investment spending in Connecticut increased by $6 billion. By how much do you think the equilibrium level of GDP (in billions of dollars) would increase? (E.g. $12,345,678,900 should be entered as 12.35)
In the year of 2019, the state of Connecticut has a total disposable income of 40 billion and total consumption of 40 billion. In the year of 2020, the state of Connecticut has a total disposable income of 50 billion and total consumption of 47.5 billion.
Planned investment spending in Connecticut has increased by 6 billion. The equilibrium level of GDP (in billions of dollars) would increase by 6 billion. Explanation:The total disposable income of the state of Connecticut increased by 10 billion from 40 billion in 2019 to 50 billion in 2020.
The total consumption expenditure of the state of Connecticut increased by 7.5 billion from 40 billion in 2019 to 47.5 billion in 2020.In macroeconomics, equilibrium is the situation when the supply of goods and services equals the demand for goods and services.
To know more about consumption visit:
https://brainly.com/question/14933604
#SPJ11
Co-occurances are:
a. Behaviors which differ among groups of Customers
b. Activities focused on building Customer Loyalty
c. Common behaviors among groups of Customers
d. Events happening at the same time
Option C is correct. Co-occurances are common behaviors among groups of Customers.
It is the occurrence or presence of certain behaviors or actions that are shared by different groups of customers. Co-occurrence analysis involves identifying patterns and relationships between these behaviors to gain insights into customer preferences, interests, or needs.
For example, in customer segmentation, co-occurrence analysis can help identify groups of customers who exhibit similar behaviors or purchase patterns. By analyzing the co-occurrence of specific actions or events, businesses can uncover associations and relationships that exist among different customer groups.
Learn more about customers here:
https://brainly.com/question/31720706
#SPJ11
Giraffe Ltd., a private corporation which follows ASPE, is in the process of preparing its financial statements for its second year of operations ending December 31, 2020. Pertinent information follows: 1. Accounting income before tax is $1,500,000. 2. Depreciation on property, plant and equipment (PPE) in the books is $150,000 and CCA claimed will be $250,000. At the beginning of the year, the book value of the PPE was $ 1,200,000. 3. The company sells a product with a 2 -year warranty. The estimated warranty cost is $100 per unit. At the beginning of 2020 , the balance in the warranty liability account was $400,000. During 2020 , the company sold 5,000 units of the product and paid out $200,000 in warranty costs. It expects that the adjusted warranty liability balance at the end of 2020 to be spent evenly over 2021 and 2022. At the end of 2019 , the company also expected the adjusted warranty liability amount to be paid evenly over 2020 and 2021. 4. The beginning balance of the future income tax liability account related to the PPE was $ 60,000 . The beginning balance of the future income tax asset account related to the warranty was $160,000. 5. The accounting income before tax included $50,000 in entertainment expenses, of which only 50% can be deducted for income tax purposes. 6. At the beginning of 2020 , the enacted income tax rate went down from 40% to 35%. 7. On December 31,2020 , the company received three years advance rent income (for 2021 through 2023) of $90,000, which was recorded as unearned revenue for book purposes, but which must be reported as 2020 revenue for income tax purposes. Question 2 Giraffe Ltd., a private corporation which follows ASPE, is in the process of preparing its financial statements for its second year of operations ending December 31,2020 . Pertinent information follows: 1. Accounting income before tax is $1,500,000. 2. Depreciation on property, plant and equipment (PPE) in the books is $150,000 and CCA claimed will be $250,000. At the beginning of the year, the book value of the PPE was $ 1,200,000. 3. The company sells a product with a 2 -year warranty. The estimated warranty cost is $100 per unit. At the beginning of 2020 , the balance in the warranty liability account was $400,000. During 2020 , the company sold 5,000 units of the product and paid out $200,000 in warranty costs. It expects that the adjusted warranty liability balance at the end of 2020 to be spent evenly over 2021 and 2022 . At the end of 2019 , the company also expected the adjusted warranty liability amount to be paid evenly over 2020 and 2021. 4. The beginning balance of the future income tax liability account related to the PPE was $ 60,000 . The beginning balance of the future income tax asset account related to the warranty was $160,000. 5. The accounting income before tax included $50,000 in entertainment expenses, of which only 50% can be deducted for income tax purposes. 6. At the beginning of 2020 , the enacted income tax rate went down from 40% to 35%. 7. On December 31, 2020, the company received three years advance rent income (for 2021 through 2023) of $90,000, which was recorded as unearned revenue for book purposes, but which must be reported as 2020 revenue for income tax purposes. Instructions a) Reconcile accounting income before tax to taxable income for 2020. b) Prepare the required income tax related journal entries for 2020 . c) Prepare the bottom section of the 2020 income statement, beginning with income before income taxes. d) What are the amounts and the SFP classifications of the future income tax asset and liability accounts at December 31,2020 ?
The reconciliation of accounting income before tax to taxable income for 2020 resulted in a taxable income of $1,915,000. The income tax expense was $674,250, and the net income after taxes was $825,750. The future income tax asset and liability accounts at December 31, 2020, were classified as non-current assets and liabilities, respectively, with balances of $114,000 and $739,000.
a) Reconciliation of Accounting Income before Tax to Taxable Income for 2020:Accounting Income before Tax: $1,500,000
Adjustments:
1. Depreciation on PPE (Book depreciation): $150,000
CCA claimed: $250,000
Book value of PPE: $1,200,000
CCA adjustment: (250,000 - 150,000) = $100,000 (added to taxable income)
2. Warranty costs:
Beginning balance of warranty liability: $400,000
Warranty costs paid: $200,000
Adjusted warranty liability at the end of 2020: $400,000 - $200,000 = $200,000
Change in warranty liability: $200,000 (added to taxable income)
3. Entertainment expenses:
Entertainment expenses: $50,000
Non-deductible portion (50%): $25,000 (added to taxable income)
4. Advance rent income:
Advance rent income for 2021-2023: $90,000 (included in taxable income)
Taxable Income:
Accounting Income before Tax ($1,500,000)
+ CCA adjustment ($100,000)
+ Change in warranty liability ($200,000)
+ Non-deductible entertainment expenses ($25,000)
+ Advance rent income ($90,000)
= Taxable Income ($1,915,000)
b) Income Tax Related Journal Entries for 2020:1. To record income tax expense:
Income Tax Expense (Income Statement) $674,250
Future Income Tax Liability (Balance Sheet) $674,250
(Calculated as taxable income ($1,915,000) x enacted tax rate (35%))
2. To record future income tax liability:
Future Income Tax Liability (Balance Sheet) $74,750
Future Income Tax Asset (Balance Sheet) $74,750
(Calculated as book depreciation ($150,000) x change in enacted tax rate (5%))
3. To record future income tax asset related to warranty:
Future Income Tax Asset (Balance Sheet) $40,000
Future Income Tax Liability (Balance Sheet) $40,000
(Calculated as change in warranty liability ($200,000) x change in enacted tax rate (5%))
c) Bottom Section of the 2020 Income Statement:Income before Income Taxes $1,500,000
Income Tax Expense ($674,250)
Net Income $825,750
d) Amounts and SFP Classifications of Future Income Tax Asset and Liability Accounts at December 31, 2020:Future Income Tax Asset: $114,000 (Balance after journal entries)
Classification: Non-current asset (Long-term)
Future Income Tax Liability: $739,000 (Balance after journal entries)
Classification: Non-current liability (Long-term)
To know more about reconciliation, refer to the link below:
https://brainly.com/question/28711445#
#SPJ11
