Question 8 If a company capitalizes costs that it should have expensed in 2X10 (assume no...
Question 8
-
If a company capitalizes costs that it should have expensed in 2X10 (assume no income tax effect),
cash flows will be lower in 2X10.
cash flows will be higher in 2X10.
no income statement effect will occur.
net income will be lower in 2X10.
net income will be higher in 2X10.
Homework Answers
It would result in a higher net income since an expense has not been considered.
Answer: net income will be higher in 2X10.
Add Answer to:
Question 8
If a company capitalizes costs that it should have expensed in
2X10 (assume no...
Which of the following costs related to a company car would NOT be expensed? (A) The...
Which of the following costs related to a company car would NOT be expensed? (A) The cost to install an engine with higher horsepower (B) The cost to change car's oil (C) The cost to replace a broken windshield (D) The cost of new tires (2 marks) 8. Daniel Construction Company paid S45,000 for equipment with a market value of $95,000. At which of the following amounts should the equipment be recorded? (A) $95,000 (B) $45,000 (C) $42,500 (D) $5,000...
The Berndt Corporation expects to have sales of $15 million. Costs other than depreciation are expected...
The Berndt Corporation expects to have sales of $15 million. Costs other than depreciation are expected to be 80% of sales, and depreciation is expected to be $1.5 million. Al sales revenues will be collected in cash, and costs other than depreciation must be paid for during the year. Berndt's federal-plus-state tax rate is 40%. Berndt has no debt. Set up an income statement. What is Berndt's expected net income Enter your answer in dollars. For example, an answer of...
Inventory costs: expensed vs. capitalized Assume that during a year, a table manufacturing company produced 900,000...
Inventory costs: expensed vs. capitalized Assume that during a year, a table manufacturing company produced 900,000 finished tables incurring raw material costs of 9 million, direct labour conversion costs of 18 million, and production overhead costs of 1.8 million. scrapped 1,000 tables (attributable to abnormal waste) incurring raw material costs of 10,000 and labor and overhead conversion costs of 20,000. spent 1 million for freight delivery charges on raw materials and 500,000 for storing the finished goods as inventory What...
QUESTION 4 8 points Save Answer Company A uses LIFO and Company B uses FIFO. Assume rising prices. In analyzing li...
QUESTION 4 8 points Save Answer Company A uses LIFO and Company B uses FIFO. Assume rising prices. In analyzing liquidity and profitability of the two firms, which of the following statements is true? Company B will have higher owners' equity. Company A will have lower cost of goods sold Company A will have higher liabilities. Company B will have lower income tax payments. It is impossible to say anything about the two firms since they use different inventory methods....
Question 10 Table 12-1 Bandroni Company Income Statement For Years Ended December 31, 2X10 and 2X09...
Question 10 Table 12-1 Bandroni Company Income Statement For Years Ended December 31, 2X10 and 2X09 2X10 2X09 Sales $900 $800 Less Cost of Goods Sold 470 440 Gross Profit $430 $360 Operating Expenses: Wage Expense $ 95 $ 90 Rent Expense 35 30 Miscellaneous Expense 20 15 Depreciation Expense 25 20 Total Operating Expenses $175 $155 Operating Income $255 $205 Less Other Expenses: Interest Expense 15 10 Income Before Tax $240 $195 Less Income Tax Expense 110 85 Net...
When issuing bonds or notes, Papaya Company incurs costs, such as legal and accounting fees, printing...
When issuing bonds or notes, Papaya Company incurs costs, such as legal and accounting fees, printing costs, and registration and underwriting fees. Papaya records these costs by combining them with any discount (or subtracting them from any premium) on the debt. Which of the following is an accurate statement regarding the company's policy? Multiple Choice This approach has the appeal of reflecting the effect that debt issue costs have on the effective interest rate because deducting debt issue costs lowers...
When issuing bonds or notes, Papaya Company incurs costs, such as legal and accounting fees, printing...
When issuing bonds or notes, Papaya Company incurs costs, such as legal and accounting fees, printing costs, and registration and underwriting fees. Papaya records these costs by combining them with any discount (or subtracting them from any premium) on the debt. Which of the following is an accurate statement regarding the company’s policy? Multiple Choice The policy is inappropriate because these costs should be expensed in the period the debt is issued. The policy is inappropriate because these costs should...
Answer First Picture please C. Now suppose that Congress changed the tax law such that, instead...
Answer First Picture please
C. Now suppose that Congress changed the tax law such that, instead of doubling Berndt's depreciation, it was reduced it by 50%. How would profit and net cash flow be affected? I. If depreciation were halved, taxable income and taxes would decline but net cash flow would rise. II. If depreciation were halved, taxable income, taxes, and net cash flow would all decline. III. If depreciation were halved, taxable income and net cash flow would rise...
12-6. Rockyford Company must replace some machinery that has zero book value and a current market value of $3,000. One p...
12-6. Rockyford Company must replace some machinery that has zero book value and a current market value of $3,000. One possibility is to invest in new machinery costing $52,000. This new machinery would produce estimated annual pretax cash operating savings of $20,800. Assume the new machine will have a useful life of 4 years and depreciation of $13,000 each year for book and tax purposes. It will have no salvage value at the end of 4 years. The investment in...
Costs that are capitalized because they are expected to have future value are called product costs;...
Costs that are capitalized because they are expected to have future value are called product costs; costs that are expensed are called period costs. This classification is important because it affects the amount of costs expensed in the income statement and the amount of costs assigned to inventory on the balance sheet. Product costs are commonly made up of direct materials, direct labor, and overhead. Period costs include selling and administrative expenses. A service company has the following costs. (You...
Which of the following costs related to a company car would NOT be expensed? (A) The cost to install an engine with higher horsepower (B) The cost to change car's oil (C) The cost to replace a broken windshield (D) The cost of new tires (2 marks) 8. Daniel Construction Company paid S45,000 for equipment with a market value of $95,000. At which of the following amounts should the equipment be recorded? (A) $95,000 (B) $45,000 (C) $42,500 (D) $5,000...
The Berndt Corporation expects to have sales of $15 million. Costs other than depreciation are expected to be 80% of sales, and depreciation is expected to be $1.5 million. Al sales revenues will be collected in cash, and costs other than depreciation must be paid for during the year. Berndt's federal-plus-state tax rate is 40%. Berndt has no debt. Set up an income statement. What is Berndt's expected net income Enter your answer in dollars. For example, an answer of...
Inventory costs: expensed vs. capitalized Assume that during a year, a table manufacturing company produced 900,000 finished tables incurring raw material costs of 9 million, direct labour conversion costs of 18 million, and production overhead costs of 1.8 million. scrapped 1,000 tables (attributable to abnormal waste) incurring raw material costs of 10,000 and labor and overhead conversion costs of 20,000. spent 1 million for freight delivery charges on raw materials and 500,000 for storing the finished goods as inventory What...
QUESTION 4 8 points Save Answer Company A uses LIFO and Company B uses FIFO. Assume rising prices. In analyzing liquidity and profitability of the two firms, which of the following statements is true? Company B will have higher owners' equity. Company A will have lower cost of goods sold Company A will have higher liabilities. Company B will have lower income tax payments. It is impossible to say anything about the two firms since they use different inventory methods....
When issuing bonds or notes, Papaya Company incurs costs, such as legal and accounting fees, printing costs, and registration and underwriting fees. Papaya records these costs by combining them with any discount (or subtracting them from any premium) on the debt. Which of the following is an accurate statement regarding the company's policy? Multiple Choice This approach has the appeal of reflecting the effect that debt issue costs have on the effective interest rate because deducting debt issue costs lowers...
Answer First Picture please
C. Now suppose that Congress changed the tax law such that, instead of doubling Berndt's depreciation, it was reduced it by 50%. How would profit and net cash flow be affected? I. If depreciation were halved, taxable income and taxes would decline but net cash flow would rise. II. If depreciation were halved, taxable income, taxes, and net cash flow would all decline. III. If depreciation were halved, taxable income and net cash flow would rise...
Most questions answered within 3 hours.
-
5. Discuss the use of fault tree analysis (FTA) for risk
assessment (maximum one paragraph).
asked 46 minutes ago -
Given that a sample of aluminium oxide has a Young's modulus of
393 GPa and a...
asked 2 hours ago -
At a certain temperature, the equilibrium constant, Kc, for this
reaction is 53.3.
H2(g)+I2(g)−⇀↽−2HI(g)Kc=53.3
At this...
asked 3 hours ago -
Question1 ) The STL provides similiar classes called stack and
queue, both of which gave functions...
asked 4 hours ago -
For Questions 1-4, assume you have 5 bits available:
1. For (positive) integers: What is the...
asked 4 hours ago -
convert grams into vloume with the density of water being at
.997514 g/cm^3 at 23.1 Celsuis...
asked 6 hours ago -
Foreman company obtained a $20,000, 6% loan on May 1, 2018.
Principal and interest will be...
asked 6 hours ago -
5. Problem 11.05 (Discounted Payback)
eBook
Project L costs $60,000, its expected cash inflows are $14,000
per...
asked 7 hours ago -
1. Which of the following is true about politics and health
organizations?
A. Health organizations are...
asked 7 hours ago -
A space vehicle is coasting at a constant velocity of 18.1 m/s
in the +y direction...
asked 8 hours ago -
5) Use the following balanced equation to answer questions
(a)-(i).
3 Cu(s) + 8 HNO3(aq) →...
asked 8 hours ago -
A three-year maturity bond with a 12% annual coupon rate is
currently traded at par $1000...
asked 8 hours ago