Described below are certain transactions of Edwardson Corporation. The company uses the periodic inventory system.1. On February 2, the corporation purchased goods from Martin Company for $70,000 subject to cash discount terms of 2/10, n/30. Purchases and accounts payable are recorded by the corporation at net amounts after cash discounts. The invoice was paid on February 26.2. On April 1, the corporation bought a truck for $50,000 from General Motors Company, paying $4,000 in cash and signing a one-year, 12% note for the balance of the purchase price.3. On May 1, the corporation borrowed $83,000 from Chicago National Bank by signing a $92,000 zero-interest-bearing note due one year from May 1.4. On August 1, the board of directors declared a $300,000 cash dividend that was payable on September 10 to stockholders of record on August 31.Make all the journal entries necessary to record the transactions above using appropriate dates.Edwardson Corporation
Answers
Answer:
Edwardson Corporation
Journal Entries:
February 2:
Debit Purchases $68,600
Credit Accounts Payable $68,600
To record credit purchases, net ($70,000 * 98%) with terms of 2/10, n/30.
February 26: Debit Purchases $1,400
Credit Accounts Payable $1,400
To revise the cash discounts not taken.
February 26: Debit Accounts Payable $70,000
Credit Cash $70,000
To record the full settlement for cash
April 1: Debit Truck $50,000
Credit Cash $4,000
Credit Notes Payable $46,000
To record the purchase of truck with a 12% note.
May 1: Debit Cash $83,000
Debit Interest Expense $9,000
Credit Notes Payable $92,000
To record zero-interest-bearing note due on May 1.
August 1: Debit Dividends $300,000
Credit Dividends Payable $300,000
To record the declaration of dividends.
Explanation:
a) Data and Analysis:
February 2: Purchases $68,600 Accounts Payable $68,600 ($70,000 * 98%)
February 26: Purchases $1,400 Accounts Payable $1,400
Accounts Payable $70,000 Cash $70,000
April 1: Truck $50,000 Cash $4,000 Notes Payable $46,000
May 1: Cash $83,000 Interest Expense $9,000 Notes Payable $92,000
August 1: Dividends $300,000 Dividends Payable $300,000
b) Note that the Interest Expense of $9,000 will be split between the current year and the following year. Specific information for the split is not available.
Final answer:
Four transactions were needed to be journalized. These include a purchase of goods with cash discount terms, a truck purchase with a down payment and a note, a borrowed amount through signing a zero-interest note, and declaring a cash dividend by the board of directors.
Explanation:
Edwardson Corporation's transactions can be recorded in the following way:
- On February 2, the corporation purchased goods for $70,000 with 2/10, n/30 terms from Martin Company. But they only paid after the discount term period, so no discount was applied. The required journal entry would be:
Debit: Purchases: $70,000
Credit: Accounts Payable: $70,000 - On April 1, the corporation bought a truck for $50,000, paying $4,000 in cash and the balance with a 12% note due in a year. The journal entry would be:
Debit: Truck (asset): $50,000
Credit: Cash: $4,000, Notes Payable: $46,000 - On May 1, the corporation borrowed $83,000 by signing a $92,000 zero-interest note due in a year. The journal entry would be:
Debit: Cash: $83,000, Discount on Notes Payable: $9,000
Credit: Notes Payable: $92,000 - On August 1, the board declared a $300,000 cash dividend payable on September 10. The journal entry would be:
Debit: Retained Earnings: $300,000
Credit: Dividends Payable: $300,000
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Answers
The tax that needs to be reduced is $ 4.66 billion
Further Explanation
The amount (Deflationary / recessionary) gap =
Keynesian Spending Multiplier from government spending
k =
Tax Multiplier from tax
t =
Option 1: Increased government spending (Loosening / Expansionary Fiscal Policy) by
GovSpending (Gs) =
Option 2: Tax is reduced by (-)
Tax = =
In economics, deflation is a period in which prices generally fall and the value of money increases. Deflation is the opposite of inflation. If inflation occurs due to a large amount of money circulating in the community, deflation occurs due to a lack of money in circulation. One way to overcome deflation is to reduce interest rates.
In the macroeconomy, a recession is a condition when the gross domestic product (GDP) decreases or when real economic growth is negative for two quarters or more in one year. Recession can result in a simultaneous decline in all economic activities such as employment, investment, and corporate profits. Recession is often associated with falling prices (deflation), or, conversely, sharply rising prices (inflation) in a process known as stagflation. The economic recession that lasts long is called economic depression. The drastic decline in the level of the economy (usually due to severe depression, or due to hyperinflation) is called economic bankruptcy (economic collapse). Columnist Sidney J. Harris distinguishes the above terms in this way: "A recession is when a neighbor loses a job; depression is when you lose a job."
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Deflationary brainly.com/question/13135934
To Reduce Tax brainly.com/question/13135934
Details
Class: College
Subject: Business
Keywords: Deflationary, tax, recessionary
Final answer:
To close the remainder of the recessionary gap, taxes need to be reduced by approximately $11.67 billion.
Explanation:
To close the remainder of the recessionary gap of $10 billion, the government has approved a spending increase of $3 billion. The question asks how much taxes need to be reduced to make up the difference. We can use the concept of the Marginal Propensity to Consume (MPC) to find the answer.
The MPC represents the proportion of additional income that individuals spend. In this case, the MPC is given as 0.6. Therefore, for every additional dollar of income, individuals will spend $0.6.
To determine how much taxes need to be reduced, we can use the formula:
Tax Reduction = (Remainder of Recessionary Gap)/MPC
Substituting the values, Tax Reduction = $7 billion/0.6 = $11.67 billion. Therefore, taxes need to be reduced by approximately $11.67 billion to close the remainder of the recessionary gap.
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Approximately how many hours per year will the solar panels need to operate to enable this project to break even?
Answers
Answer:
It will take 6,534.31 hours per year for the solar panels to operate to enable this project to break even
Explanation:
Discount rate = 30% = 0.3
Looking at one hour of operation in each year = 200 kW x $0.30 Kw/hr
= $60 value of electricity per year
Compound interest factor for a discount rate of 30% = 3.3158
(taken from compound interest factor table or computed using formula ∑1/(1+r)^t , where r = 30%, and t = 1 to 30)
Present value of operating the solar panels for 1 hour per year = 60 × 3.3158 = $ 198.95
For break even it would need to run = 1.3 million ÷ 198.95
= 6,534.31 hours per year
The solar panels need to operate for approximately 236,364 hours per year to enable this project to break even.
To determine the number of hours per year the solar panels need to operate to break even, we can calculate the present value of operating the solar panels for 1 hour per year over the 20-year lifespan of the panels.
The annual operating cost is $0.30 per kWh, and the capacity of the solar panels is 200 kW. So, for each hour of operation, the cost is:
Cost per hour = 200 kW * $0.30/kWh = $60
Now, we'll calculate the present value of this cost over 20 years at a 30% discount rate:
PV Cost = $60 / ≈ $5.50
The university spent $1.3 million upfront to install the panels. To break even, the present value of operating the panels should cover this cost:
$1,300,000 = $5.50 * X
Where X is the number of hours per year the panels need to operate. Solving for X:
X ≈ $1,300,000 / $5.50 ≈ 236,364 hours per year.
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Answers
Answer:
I agree with that, because all of them have good bussiness ideas.
Final answer:
Even though a general partnership might work for Alice, Betty, and Cathy, a limited liability company (LLC) or a corporation might be more appropriate due to Alice's wealth, Betty's business knowledge, and Cathy's valuable scientific process. This way, they can better protect their individual assets, as well as the venture's funding and potential expansion.
Explanation:
While a general partnership might seem like a viable solution for Alice, Betty, and Cathy, it may not be the most optimal choice considering their individual circumstances and contributions. In a general partnership, every partner shares liability and financial commitment equally or according to their investment. Although this may initially seem fair, it might put Alice at risk since she's contributing the most financially. Instead, I'd recommend considering a limited liability company (LLC) or corporation.
In an LLC, Alice, Betty, and Cathy can limit their personal liabilities. This would allow Alice to protect her wealth while still contributing to the venture. In a corporation, the company is considered a separate legal entity. This structure can also be beneficial if they plan on seeking outside venture capital or looking into other ambitious expansion.
Remember, the final decision depends on various factors including tax considerations, business goals, and the level of desired legal protection. It is advisable to consult with a business advisor or attorney before deciding.
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b. $258,072
c. $120,000
d. $142,409
Answers
Answer:
NPV = $-41,928.18
Explanation:
Net present value is the present value of after tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator:
Cash flow in year 0 = $-300,000
Cash flow each year from year 1 to 10 = $42,000
I = 10%
NPV = $-41,928.18
To find the NPV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
Answer:
b. $258,072
Explanation:
PERIOD CASH FLOW NET PRESENT VALUE
Year 1 $42,000
Year 2 $42,000
Year 3 $42,000
Year 4 $42,000
Year 5 $42,000
Year 6 $42,000
Year 7 $42,000
Year 8 $42,000
Year 9 $42,000
Year 10 $42,000
Total $258,071.83
Answers
Answers
Answer: 2.5
Explanation:
The Turnover (Asset Utilization) is calculated by dividing the business Turnover (Sales) by it's Assets.
We have the amount of assets (Investment). Now we have to calculate the Sales.
The Net Income was 12.5% of $100,000 so solving for that would be,
= 0.125 * 100,000
= $12,500
$12,500 was the Net Income.
It was said that the Net Income was 5% of sales so using algebra we have,
12,500= 0.05x
x = 12,500/0.05
= $250,000
With sales of $250,000 we can calculate the Turnover as,
Asset Turnover = Sales / Assets( Investment)
= 250,000/100,000
= 2.5
If you need any clarification do react or comment.
Answer:
The Turnover = 2.5
Explanation:
Step 1 : Find Net income
Return on Investment (ROA) = Net income/ Assets
12.5%=Net Income/$100,000
Net income = $100,000*12.5%
Net income= $12,500
Step 2 : Calculate Sales
Net income = Sales *5%
Therefore substitute known values
Sales = $12,500 *100/5
Sales = 250,000
Step 3 : Calculate Turnover ratio
Turnover = sales/ Assets
= 250,000/100,000
=2.5