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2 years ago

Acquisition costs; journal entries

Business

1 answer:

Aleks [24]2 years ago

7 0

Answer:

Journal entries for the transactions are given below

Explanation:

1. Development of new product

DEBIT CREDIT

Research and development $24,000

Cash $24,000

2. Paid the plaintiff for losing patent

DEBIT CREDIT

Legal fee (expense) $8,000

Cash $8,000

3. Bought Equipment and signed non-interest bearing note

DEBIT CREDIT

Equipment Cash price $37,000

Discount on note payable $5,000

Cash paid $18,000

Note payable $24,000

4. Installed sprinkler system

DEBIT CREDIT

Sprinkler system $40,000

Cash $40,000

5. Plaintiff paid for successful infringement suit on its patent

DEBIT CREDIT

Patent $24,000

Cash $24,000

6. Bought New equipment and traded old one

DEBIT CREDIT

New Equipment $13,600

Accumulated depreciation $6,800

Loss on sale $3,400

Old Equipment $13,400

Cash $10,400

Working:

Accumulated depreciation = Original Cost - book value

Accumulated depreciation = $13,400 - $6,600

Accumulated depreciation = $6,800

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At December 31, 2020, Ivanhoe Corporation had a deferred tax liability of $26,800. At December 31, 2021, the deferred tax liabil

Tju [1.3M]

Answer:

$65,300

Explanation:

Ivanhoe's income tax expense = deferred tax liability 2021 - deferred tax liability 2020 + current tax expense 2020 = $42,800 - $26,800 + $49,300 = $65,300

A deferred tax liability occurs when a corporation's income statement shows a certain amount following US GAAP, but the tax rules used by the IRS determine a different amount.

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2 years ago

Vanessa bought a house for $268,500. She has a 30 year mortgage with a fixed rate of 6.25%. Vanessaâs monthly payments are $1,59

Musya8 [376]

Answer:

Ans. A) $9,314.45

Explanation:

Hi, first we have to bring to present value the monthly payments to be made for 30 years (360 months). In order for this to be useful, we have to convert this annua compounded monthly rate (6.25%) to an effective rate, that is 6.25% / 12 = 0.5208%. Now, when we find this present value, we are going to substract it from the price of the house and that is the value of the down payment. But let´s just go ahead and do it together.

We have to use this formula to bring to present value the $1,595.85 monthly payments, for 30 years (360 months) at a rate of 6.25% (0.5208% monthly).

$PresentValue=\frac{A((1+r)^{n}-1) }{r(1+r)^{n} }$

It should look like this

$PresentValue=\frac{1,595.85((1+ 0.005208 )^{360}-1) }{0.005208(1+0.005208)^{360} }$

$Present Value=259,185.55$

Now, let´s go ahead and find the down payment.

$DownPayment=Price-PresentValue$

$DownPayment=268,500-259,185.55= 9,314.45$

So, the answer is a). $9,314.45

Best of luck.

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2 years ago

At Lequals86, Kequals90, the marginal product of labor is 8 and the marginal product of capital is 2. What is the marginal rat

Sidana [21]

Answer:

0.25

Explanation:

The marginal rate of technical substitution (MRTS) can be described as the rate of a reduction is one factor to maintain the same production level when another factor is increased.

Given that labor is measured on the horizontal axis, the MRST of K for L can be calculated as follows:

$MRST_{KL} = \frac{MP_{K} }{MP_{L} }$

Where;

MPK = Marginal product of capital = 2

MPL = Marginal product of labor = 8

Substituting the values into the equation, we have:

$MRST_{KL} = \frac{2}{8} =\frac{1}{4} = 0.25$

This implies that 0.25 of capital must be given up to have one unit of labor.

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2 years ago

Cox Co. accounts for its inventory using the LIFO cost method. An inventory loss from a permanent market decline of $360,000 occ

kirill115 [55]

Answer:

$360,000

Explanation:

Last in first out (LIFO) is a method used in inventory where the cost of most recently purchased goods is the one to be expensed first. Also current losses are the first to be reported.

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The loss reported in May will be reported for that quarter in June.

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2 years ago

Assume Metro Corporation had a net income of $ 2,200 for the year ending December 2018. Its beginning and ending total assets we

Aleksandr-060686 [28]

Answer:

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In order to calculate the return on assets we will first need to find the average total assets. We will do this by adding the beginning and ending total assets and dividing it by 2.

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2 years ago