] How should a gain from the sale of used equipment for cash be reported in a statement of cash flows using the indirect method?

Answers

Answer 1

Answer:

Answer:

A gain from the sale of used equipment for cash should be subtracted from net income

Explanation:

Indirect method make adjustment to reconcile the net income to cash. It depends on the account if it is added or subtracted to net income.

In this case, a gain from the sale of used equipment for cash is subtracted from net income.

Related Questions

When aggregate demand is high enough to drive unemployment below the natural rate:_________a. there is downward pressure on the price level, and the government may want to conduct contractionary fiscal policy. b. the economy is slipping into a recession, and the government may want to conduct expansionary fiscal policy. c. there is upward pressure on the price level, and the government may want to conduct contractionary fiscal policy. d. there is upward pressure on the price level, and the government may want to conduct expansionary fiscal policy. e. there is downward pressure on the price level, and the government may want to conduct expansionary fiscal policy.
Thirty-five percent of the sales on account are collected in the month of sale, 45% in the month following sale, and the remainder are collected in the second month following sale. The following are budgeted sales data for the company: January February March April Total sales $50,000 $60,000 $40,000 $30,000 What is the amount of cash that should be collected in March
The Skulls, a student social organization, has two different locations under consideration for constructing a new chapter house. The Skulls' president, a POM student, estimates that due to differing land costs, utility rates, etc., both fixed and variable costs would be different for each of the proposed sites, as follows: Location Annual Fixed Variable Alpha Ave. $ 5,000 $ 200 per person Beta Blvd. $ 8,000 $ 150 per person What would be the total annual costs for the Alpha Ave. location with 20 persons living there
Suppose that France and Germany both produce fish and olives. France's opportunity cost of producing a crate of olives is 4 pounds of fish while Germany's opportunity cost of producing a crate of olives is 10 pounds of fish. By comparing the opportunity cost of producing olives in the two countries, you can tell that __________ has a comparative advantage in the production of olives and _______ has a comparative advantage in the production of fish.
McCoy Brothers manufactures and sells two products, A and Z in the ratio of 5:2. Product A sells for $75; Z sells for $95. Variable costs for product A are $35; for Z $40. Fixed costs are $418,500. Compute the contribution margin per composite unit

CD is an all equity firm that has 10,000 shares of stock outstanding at a market price of $20 a share. The firm's management has decided to issue $50,000 worth of debt and use the funds to repurchase shares of the outstanding stock. The interest rate on the debt will be 5 percent.a. What are the earnings per share at the break-even level of earnings before interest and taxes? Ignore taxes.

Answers

Answer:

EPS = $ 2.00

Explanation:

Earning per share: EBIT/outstanding shares

unlevered firm EPS:

oustanding shares: 10,000

Levered firm EPS:

(EBIT - interest)/outstanding shares

where:

Interest_ 50,000 x 5% = 5,000

Shares repurchase: 50,000 / 20 = 2,500

Outstanding shares: 10,000 - 2,500 = 7,500

$\left \{ {{EPS = EBIT/10,000} \atop {EPS = EBIT-5,000/7,500}} \right.$

EBIT/10,000 = (EBIT-5,000)/7,500

(0.75)EBIT = EBIT - 5,000

5,000 / (1-0.75) = EBIT

EBIT = 20,000

EPS: 20,000 / 10,000 = 2.00

__________ entail the performance of specialized activities by individuals or organizations for purposes of benefiting other entities (usually customers).

Answers

Answer:

Services.

Explanation:

As it is been explained to be a individual or organizational performance, which directly holds certain forms of benefit to many. It also can be said to be a transaction during which no physical goods are transferred from the vendor to the customer. It holds certain advantages of such a service are held to be demonstrated by the buyer's willingness to create the exchange. Public services are those who society (nation state, fiscal union or region) as an entire pays for. Using resources, skill, ingenuity; service providers benefit service consumers.

Free-Flo Pipes & Plumbing Corporation is a private employer involved in an employment discrimination suit under the Civil Rights Act. Punitive damages may be recovered against Free-Flo only if the employer ...a. can easily afford to pay the amount.
b. has one hundred or more employees.
c. consents.
d. acted with malice or reckless indifference.

Answers

Answer: Acted with mallice and reckless indifference

Explanation: As per the legislations passed under Civil rights act, to recover the damages beyond simple compensation, in case of discrimination at work place by the employer, the act done must be reckless indifference like deliberate partial behavior on the basis of gender or race.

Sebastian received a raise this year so his income climbed from $45,000 to $52,000. Last year Sebastian purchased 2 sunglasses. This year he has purchased 7 sunglasses. Assuming that all of the other things remain constant, what type of a good are sunglasses and what type of income elasticity of demand does Sebastian have

Answers

Answer:

normal good

elastic demand

Explanation:

Income elasticity of demand measures the responsiveness of quantity demanded to changes in income.

Income elasticity = percentage change in quantity demanded / percentage change in income

percentage change in quantity demanded = (7/2) - 1 = 250%

percentage change in income = (52,000 / 45,000) - 1 = 15.6%

250 / 15.6 = 16.07

If the absolute value of income elasticity of demand is greater than one, it means demand is elastic.

Normal goods are goods that are goods whose demand increases when income increases and falls when income falls

Inferior goods are goods whose demand falls when income rises and increases when income falls.

Walters Audio Visual, Inc., offers a stock option plan to its regional managers. On January 1, 2016, options were granted for 40 million $1 par common shares. The exercise price is the market price on the grant date, $8 per share. Options cannot be exercised prior to January 1, 2018, and expire December 31, 2022. The fair value of the options, estimated by an appropriate option pricing model, is $2 per option. Because the plan does not qualify as an incentive plan, Walters will receive a tax deduction upon exercise of the options equal to the excess of the market price at exercise over the exercise price. The income tax rate is 40%.Required: 1. Determine the total compensation cost pertaining to the stock option plan. (Enter your answer in millions (i.e., 10,000,000 should be entered as 10).)

2. Prepare the necessary journal entries. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

1. Record compensation expense on December 31, 2016.

2. Record any tax effect related to compensation expense recorded in 2016.

3. Record compensation expense on December 31, 2017.

4. Record any tax effect related to compensation expense recorded in 2017.

5. Record the exercise of the options on March 20, 2021 when the market price is $12 per share.

6. Record any tax effect related to the exercise of the options.

Answers

Answer:

Explanation:

1. Determine the total compensation cost pertaining to the stock option plan:-

Estimated fair value per option $2

X Option granted 40 million

Total compensation $ 80 million

Assume Joe Harry sells his 25 percent interest in Joe's S Corp., Inc., to Tyrone on January 29. Using the daily allocation method, how much income does Joe Harry report if Joe's S Corp., Inc., earned $200,000 from January 1 to January 29 and a total of $1,460,000 from January 1 through December 31 (365 days)?a. $28,000.
b. $50,000.
c. $112,000.
d. $200,000.
e. None of the above.

Answers

Answer:

$29,000

Explanation:

Joe sells 25% of his interest to Joe's S corporation

= 25/100

= 0.25

Therefore using the daily allocation method, the amount of income reported if Joe earns $200,000 from January 1st to January 29th and a total of $1,460,000 for 365 days

= 1,460,000/365 days × 29 days × 0.25

= 4,000×29×0.25

= $29,000

Hence the amount of income reported by Joe Harry is $29,000

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