Answer:
The first loan for $8,000 could fall under the exemption of employer-employee loan. But then after the second is taken, that exemption would no longer apply. A minimum interest of $18,000 x 4% x 6/12 = $360 should be charged.
If the loan is considered a corporation-shareholder loan, then it doesn't qualify for any type of exemption, resulting in interests = ($8,000 x 4% x 6/12) = $160 for 2020
for 2021, interest applied = [($8,000 + $160) x 4%] + ($10,000 x 4% x 6/12) = $326.40 + $360 = $686.40
Bob makes his first deposit into an IRA earning compounded annually on his th birthday and his last deposit on his birthday ( equal deposits in all). With no additional deposits, the money in the IRA continues to earn interest compounded annually until Bob retires on his th birthday. How much is in the IRA when Bob retires
Answer:
$187,881.52
Explanation:
The computation is shown below:
The future value would be
= PMT × ((1 + rate of interest)^number of years -1) ÷ (rate of interest)
= $1,500 × ((1 + 0.066)^13 - 1) ÷ (0.066)
= $1,500 × 19.626
= $29,439.14
Now when bob retired, the amount is
= $29,439.14 × (1 + 0.066)^29
= $29,439.14 × 6.383
= $187,881.52
Concerned by recent negative trends in economic indicators such as the consumer price index, gross domestic product, and inflation, the marketing manager of Kevin's Kayaks recommends that the company reduce its advertising spending. His recommendation is based on ________ data.
Answer:
Macroeconomics.
Explanation:
Economics can be classified into two (2) main categories, namely;
1. Microeconomics can be defined as the study of the effect of price and quantity levels through interactions between individual buyers and sellers in various markets. Simply stated, it focuses on analyzing or evaluating the decisions of consumers (buyers) and those of firms (sellers) such as methods of production, pricing; and the manner in which government policies affect those decisions.
2. Macroeconomics can be defined as the study of behaviors, performance and factors that affect the entire economy. Therefore, it focuses on aggregate phenomena such as price level, economic growth, Gross Domestic Product (GDP), inflation, unemployment and national income levels with respect to the central bank, demand or supply shocks, government policies, aggregate spending and savings.
In this scenario, concerned by recent negative trends in economic indicators such as the consumer price index, gross domestic product, and inflation, the marketing manager of Kevin's Kayaks recommends that the company reduce its advertising spending. Thus, his recommendation is based on macroeconomics data.
This ultimately implies that, macroeconomic is a form of externality that typically affects the levels of inflation, unemployment, consumer price index, or growth in the economy as a whole (GDP).
18 month rent was paid at year end how will this effect the balance sheet
Answer:
Explanation:
The correct answer to your questions is letter A. Assets will be decreased.
Jack works for Red, Blue and Green CPAs. Each year Red, Blue and Green asks Jack to fill out a form indicating all of his financial interests and those of his family members and close friends. Red, Blue and Green uses these charts to ensure that their auditors comply with the independence standards as described by the AICPA Code of Professional Conduct.
Code of Professional Conduct contains examples of situations that may impair an auditor's independence. Relationships are divided into three categories for purposes of the interpretations: immediate family, close relatives, and other relatives and friends. It is important for an auditor to understand how existing relationships fit into these categories so that the auditor can determine if there is an effect on his or her independence. Understanding of relationships is of primary importance to understanding the auditor's Code of Professional Conduct regarding independence. Place the following relationships into the appropriate category.
1. Immediate Family
2. Close Relative
3. Other Relative or Friend
a. Dependent
b. Child
c. Father
d. Cousin
e. Spouse
f. Sister
g. Golf
h. Partner
i. Spouse
j. Equivalent
k. Brother
l. Niece
m. Dependent
n. Parent
o. Mother
p. Nephew
q. Independent
r. Child
s. College
t. Friend
u. Grand father
Roommate
Answer:
1.Immediate Family:
Dependent Child
Spouse
Spouse equivalent
Dependent Parent
2.Close Relatives:
Father
Mother
Sister
Brother
Grand Father
Independent Child
3. Other relatives and Friends:
Cousin
Golf Partner
College Friend
Roommate
Nephew
Niece
Explanation:
Code of Professional conduct is a list of standards which are required to be followed by the CPA professionals. It provides guidance to the professionals about the decision making in certain situations. There are two broad categories which is rules and standard. Rules are mandatory to be followed regardless of the situation and there can not be any deviation allowed from the listed rule. Standard provide guidance for decision making in business scenarios.
Use the following tax rates, ceiling and maximum taxes:
Employee and Employer OASDI: 6.20% $127,200 $7,886.40
Employee* and Employer HI: 1.45% No limit No maximum
Self-employed OASDI: 12.4% $127,200 $15,772.80
Self-employed HI: 2.9% No limit No maximum
*Employee HI: Plus an additional 0.9% on wages over $200,000. Also applicable to self-employed.
Rounding Rules: Unless instructed otherwise compute hourly rate and overtime rates as follows:
Carry the hourly rate and the overtime rate to 3 decimal places and then round off to 2 decimal places (round the hourly rate to 2 decimal places before multiplying by one and one-half to determine the overtime rate).
If the third decimal place is 5 or more, round to the next higher cent.
If the third decimal place is less than 5, drop the third decimal place.
Also, use the minimum hourly wage of $7.25 in solving these problems and all that follow.
Jax Company's (a monthly depositor) tax liability (amount withheld from employees' wages for federal income tax and FICA tax plus the company's portion of the FICA tax) for July was $1,210. No deposit was made by the company until August 24, 20--. Determine the following:
Note: Round your answers to the nearest cent and assume 365 days in a year.
a. The date by which the deposit should have been made August 25
b. The penalty for failure to make timely deposit $________
c. The penalty for failure to fully pay tax when due $________
d. The interest on taxes due and unpaid (assume a 4% interest rate) $________
Answer:
A. 15th August
B. 60.5
C. 6.05
D. 1.19
Explanation:
Let assume that during the lookback period, you reported a tax rate of $50000 or less. It implies that you're a monthly depositor(based on schedule) and all taxes much be deposited on or before the 15th day of the next month.
Inability to meet up with the timely deposit has penalty based on their tiers.
For 1 - 5 days late = 2% of upaod depsot
6 - 15 late = 5% on tax payment
15 days late = 10% on deposits
10 days late of IRS = 15% on deposit
Since no deposits were made till Aug 24, then deposit has been delayed by 9 days (i.e. Aug 15 - 24)
Thus, the penalty for making timely deposit = 1210 × 0.05 = 60.5
Inability to pay the penalty = 0.5 percent per month ( for unpaid taxes).
So, the penalty for failure of fully paid tax = 120 × 0.5% = 6.05
Assuming a 4% interest rate; the interest on taxes due & unpaid is
= 1210 × 0.04 × 9/365
= 1.19
Therefore, the total penalty imposed = 60.5 + 6.05 + 1.19 = 67.74
The statement of cash flows shows the following information: Cash provided by operating activities of $18,200 Cash used by investing activities of $6,700 Cash used by financing activities of $1,200 The beginning cash was $17,100. What is the amount of cash at the end of the period
Answer:
$27,400
Explanation:
The amount of cash at the end of the period is calculated as;
Cash provided by operating activities
$18,200
Cash used by investing activities
($6,700)
Cash used by financing activities
($1,200)
Net increase (decrease) in cash balance
(a) $10,300
Cash at the beginning of the year
(b) $17,100
Cash at the end of the year
c = (a) + (b) = $27,400
A management dilemma defines the research question. Group startsTrue or FalseTrue, selectedFalse, unselected
Answer:
False
Explanation:
It is not always the case that a management dilemma results in the research question. However, a research question might be defined by an identified need for improvement.
A management dilemma defines the research question is false. The correct option is false.
A research topic is defined as "a question that a research project seeks to answer." A research question must be chosen for both quantitative and qualitative research. Data gathering and analysis will be required for the investigation, and the methods for this may vary greatly. Good research topics are usually focused and specific in order to improve understanding on an essential topic.
To formulate a research topic, one must first decide if the study will be qualitative, quantitative, or mixed. Other circumstances, such as project finance, may have an impact not only on the research topic itself, but also on when and how it is created during the research process.
Learn more about research, here:
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The case for product differentiation does not include the fact that A) products that satisfy a real demand survive. B) standards of living rise with product innovation. C) new products satisfy people with different preferences. D) it wastes society's scarce resources.
Answer:
D) it wastes society's scarce resources.
Explanation:
Product differentiation means the products that should be different as compared with the competitor in terms of cost, quality, delivery time, attractiveness, etc
It should involve the satisfaction of the real demand, also the living standard should be rise as per the innovation of the product, and the new product would satisfy the people with their various preferences but it does not involved the wastage of the scarce resources
hence, the option D is correct
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XYZ Corporation had 158 million shares outstanding on January 1, 2012. On February 2,2012, it issued an additional 30 million shares to the market at the market priceof $55 per share. What was the effect of this share issue on the price per share
Answer:
There was no effect of this share issue on the price per share
Explanation:
First, we need to determine the pre-issuance value
Numbers of outstanding shares = 158,000,000 shares
Total Value of equity = Numbers of outstanding shares x Market value per share = 158,000,000 shares x $55 per share = $8,690,000,000
Now calculate the issuance values
Numbers of shares issued = 30,000,000 shares
Vaue of issued equity = NUmbers of shares issued x Mrket value per share = 30,000,000 x $55 per share = $1,650,000,000
Now determien the post issuance value
Numbers of outstanding shares = 158,000,000 shares + 30,000,000 shares = 188,000,000 shares
Total Value of equity = $8,690,000,000 + $1,650,000,000 = $10,340,000,000
Now calcuate the Value per share
Value per share = Post Issuance Total value of equity / Post issuance total numbers of shares = $10,340,000,000 / 188,000,000 shares = $55 per share
There is no effect of share issue on the price of the share.
Communication begins with the self
Answer:
In psychology, this refers to your sense of self-knowing your perspective, thoughts, values, feelings, and desires. It also means articulating your thoughts and emotional needs in a way that is congruent, exposing who you truly are.
Explanation:
Most of the time it is quite difficult to separate the three functions of money. Money performs its three functions at all times, but sometimes we can stress one in particular. For each of the following situations, identify which function of money is emphasized: _________
a) Brooke accepts money in exchange for performing her daily tasks at her office, since she knowsshe can use that money to buy goods and services: medium of exchange
b) Tim wants to calculate the relative value of oranges and apples, and therefore checks the price per pound of each of these goods quoted in currency units: unit of account
c) Maria is currently pregnant. She expects her expenditures to increase in the future and decides to increase the balance in her savings account: store of value
Answer:
a medium of exchange
a unit of account
a store of value,
Explanation:
Functions of money
1. Medium of exchange : money can be used to exchange for goods and services. For example, money serves as a medium of exchange when you pay $20 for your favourite jeans
2. Unit of account : money can be used to value goods and services, For example, $20 is the value of your favourite jeans
3. Store of value : money can retain its value over the long term, this it can be used as a store of value
The GAP is a global clothing retailer for men, women, children, and babies. The following information is taken from The Sap's fiscal 2015 annual report. Selected Balance Sheet Data ($ millions)20152014 Inventories$1,918$1,844 Accounts Payable1,1571,128 a. The Gap purchased inventories totaling $10,438 million during fiscal 2015. Use the financial statement effects template to record cost of goods sold for The Sap's fiscal year ended 2015. (Assume accounts payable is used only for recording purchases of inventories and all inventories are purchased on credit.) b. What amount did the company pay to suppliers during the year
Answer:
The GAP
a. Cost of goods sold = $10,364
b. Cash paid to suppliers = $10,409
Explanation:
a) Data and Calculations:
Selected Balance Sheet Data
($ millions) 2015 2014
Inventories $1,918 $1,844
Accounts Payable 1,157 1,128
Purchases during 2015 = $10,438 million
b) Cost of goods sold:
Beginning inventory $1,844
Purchases 10,438
Goods available $12,282
Ending inventory (1,918)
Cost of goods sold $10,364
c) Accounts Payable:
Beginning balance $1,128
Purchases 10,438
Less ending balance 1,157
Cash paid to suppliers $10,409
If a firm is to capture all consumer surplus with twopart pricing when customers are different A. it must set unit price below marginal cost. B. it must set unit price above marginal cost. C. it cannot charge different prices for access fees. D. it must be able to charge different access fees.
Answer: D. it must be able to charge different access fees.
Explanation:
Two part pricing refers to the charging of two prices for access to a service which are a fixed price(lumpsum) and a variable price for every unit used.
If one wants to capture all consumer pricing with this strategy and customers are different, the company simply needs to be able to charge different access fees.
This way they'll be able to charge the different customers different prices based on their willingness to pay such that they will capture all consumer surplus.
The large percentage of population involved in agriculture in China indicates that most people consume an inadequate number of calories. most people must produce food for their own survival factory production cannot expand. the country imports most of its food. few people are unemployed
Answer:
The answer is "most people must produce food for their own survival".
Explanation:
Its large percentage of Chinese people involved in agriculture indicates that the majority of people have had to make food to sustain themselves. The processing of dairy products, wool, fruits, veggies, meat, livestock, eggs, and farmed fish is among the first nations in the world. Only with importance attached to opening farming with the outside world, China is becoming more and more closely connected with the other countries.
Consider a firm making production decisions in the short run. Select the statement(s) that must be correct. Choose one or more: A. Average total cost will always exceed average variable cost. B. Average total cost cannot decline as output increases, at any level of output. C. Average fixed cost cannot increase with output, at any level of output. D. Average variable cost is always above the average fixed cost. E. Average variable cost cannot decline with output, at any level of output.
Answer:
A). Average total cost will always exceed average variable cost.
C). Average fixed cost cannot increase with output, at any level of output
Explanation:
In the short term, a company that increases its profits will increase production if the marginal cost is less than the marginal income. Reduction in production if marginal cost exceeds marginal income. Continue production when the average variable cost is less than the unit. so correct answer is A and CInternational businesses need to understand the nature of the globalization debate and observe how their own practices may act in support of, or against globalization.
a. True
b. False
Answer:
true
Explanation:
Following are the transactions of a new company called Pose-for-Pics. Aug. 1 Madison Harris, the owner, invested $7,400 cash and $34,400 of photography equipment in the company in exchange for common stock. 2 The company paid $3,000 cash for an insurance policy covering the next 24 months. 5 The company purchased office supplies for $970 cash. 20 The company received $4,231 cash in photography fees earned. 31 The company paid $765 cash for August utilities. Required: 1. Post the transactions to the T-accounts. 2. Use the amounts from the T-accounts in Requirement (1) to prepare an August 31 trial balance for Pose-for-Pics.
Answer:
Pose-for-Pics
1. T-accounts:
Cash
Date Account Title Debit Credit
Aug. 1 Common stock $7,400
Aug. 2 Prepaid insurance $3,000
Aug. 5 Office supplies 970
Aug. 20 Photography Fees 4,231
Aug. 31 Utilities 765
Aug. 31 Balance $6,896
Common Stock
Date Account Title Debit Credit
Aug. 1 Cash $7,400
Aug. 1 Photography equipment 34,400
Aug. 31 Balance $41,800
Photography Equipment
Date Account Title Debit Credit
Aug. 1 Common stock $34,400
Prepaid Insurance
Date Account Title Debit Credit
Aug. 1 Cash $3,000
Office Supplies
Date Account Title Debit Credit
Aug. 1 Cash $970
Photography Fees
Date Account Title Debit Credit
Aug. 20 Cash $4,231
Utilities Expense
Date Account Title Debit Credit
Aug. 31 Cash $765
2. Trial Balance
As of August 31
Account Title Debit Credit
Cash $6,896
Common stock $41,800
Equipment 34,400
Prepaid insurance 3,000
Office supplies 970
Photography fees 4,231
Utilities expense 765
Totals $46,031 $46,031
Explanation:
Before transactions are posted to the T-accounts (General Ledger) they are recorded in the General Journal. The T-accounts summarize the transactions into various ledger accounts. Periodically, the accounts are balanced and a trial balance is extracted to check if the posting is error-free.
The following data are for Guava Company's retiree health care plan for the current calendar year. Number of employees covered 5 Years employed as of January 1 4 (each) Attribution period 20 years EPBO, January 1 $ 64,000 EPBO, December 31 $ 68,480 Interest rate 7 % Funding and plan assets None What is the service cost to be included in the current year's postretirement benefit expense?
Answer:
$3,424
Explanation:
Calculation for What is the service cost to be included in the current year's postretirement benefit expense
Service cost=December 31 $ 68,480*1/20 years
Service cost=$3,424
Therefore the service cost to be included in the current year's postretirement benefit expense will be $3,424
At the beginning of the year (January 1), Maurice and Sons has $16,300 of common stock outstanding and retained earnings of $2,200. During the year, the company reports net income of $3,410 and pays dividends of $1,550. In addition, the company issues additional common stock for $5,800.
Required: Prepare the statement of stockholders' equity at the end of the year (December 31).
Answer:
See below
Explanation:
Maurice and Sons
Statement of stockholder's equity at the end of the year (December 31)
Particulars Common stock
Retained earnings Total
Beginning
Balance $16,300
$2,200. $18,500
Net income
$3,410. $3,410
Dividend paid
-$1,550. -$1,550
Additional common
Stock $5,800. $5,800
Total
$4,060. $22,100. $26,160
are capital markets also organisational markets?
Answer:A capital market is a financial market in which long-term debt (over a year) or equity-backed securities are bought and sold.[6] Capital markets channel the wealth of savers to those who can put it to long-term productive use, such as companies or governments making long-term investments.[a] Financial regulators like Securities and Exchange Board of India (SEBI), Bank of England (BoE) and the U.S. Securities and Exchange Commission (SEC) oversee capital markets to protect investors against fraud, among other duties.
Modern capital markets are almost invariably hosted on computer-based electronic trading platforms; most can be accessed only by entities within the financial sector or the treasury departments of governments and corporations, but some can be accessed directly by the public. As an example, in the United States, any American citizen with an internet connection can create an account with TreasuryDirect and use it to buy bonds in the primary market, though sales to individuals form only a tiny fraction of the total volume of bonds sold. Various private companies provide browser-based platforms that allow individuals to buy shares and sometimes even bonds in the secondary markets. There are many thousands of such systems, most serving only small parts of the overall capital markets. Entities hosting the systems include stock exchanges, investment banks, and government departments. Physically, the systems are hosted all over the world, though they tend to be concentrated in financial centres like London, New York, and Hong Kong.
Explanation:
In the fall of 2014, China and the United States agreed to expand the Information Technology Agreement to drop tariffs on a number of technology products. This is an example of_________ reducing protectionist measures.
Answer:
Free trade policy.
Explanation:
Trade can be defined as a process which typically involves the buying and selling of goods and services between a producer and the customers (consumers) at a specific period of time.
In the fall of 2014, China and the United States agreed to expand the Information Technology Agreement to drop tariffs on a number of technology products. Therefore, this is an example of free trade policy reducing protectionist measures.
Free trade policy includes the adoption and implementation of tariffs and quotas between countries.
Trade policies tariffs and quotas will most likely benefit domestic producers of the protected good and harm domestic consumers of the protected good as they're made to pay for the consumption of imported products. Hence, under free trade there are more societal benefits due to the specialization of domestic goods.
Tariffs can reduce both the volume of exports and imports in a country.
In order to generate revenues, domestic government make use of tariffs while quotas do not generate any revenue for them.
Consider the production department of a manufacturer of laptop computers. Classify the cost of the factory maintenance manager's salary.
a. Period
b. Variable
c. Indirect
d. Fixed
e. Direct
f. Product
Answer:
c. Indirect
d. Fixed
f. Product
Explanation:
Cost of the factory maintenance manager's salary is a manufacturing cost. However, this manufacturing cost is an Indirect and fixed cost. Manufacturing costs are Product costs whereas Non-Manufacturing costs are Period Costs
Requirement Assume that all supplies purchased were used in operations in the year of purchase. Rental payments pertain to rental space used in the year of payment. 1. Prepare an income statement for for and under both the cash and the accrual basis of accounting. 2. Compute operating cash flow for both years under cash and accrual bases.
Question Completion:
You are provided the following information for the Del Campo Consulting Associates.
2019 2018
Service revenue (accrual basis) $250,000 $185,000
Cash collected from clients 97,000 80,000
Operating expenses:
Salary expense (accrual basis) 12,000 16,500
Purchased supplies for cash 4,000 2,500
Purchased supplies on account 1,000 1,500
Depreciation expense 2,000 2,000
Rent paid in cash 7,000 3,000
Prepaid insurance 5,500 0
Answer:
Del Campo Consulting Associates
Accrual Basis Cash Basis
Income Statements 2019 2018 2019 2018
Service revenue $250,000 $185,000 $97,000 $80,000
Operating Expenses:
Salary expense 12,000 16,500 0 0
Supplies 5,000 4,000 4,000 2,500
Depreciation 2,000 2,000 0 0
Rent 7,000 3,000 7,000 3,000
Prepaid Insurance 0 0 5,500 0
Total operating expenses $26,000 $25,500 $16,500 $5,500
Net income $224,000 $159,500 $80,500 $74,500
2. Compute Operating Cash Flow under cash and accrual basis:
Accrual Basis Cash Basis
Operating Cash Flow 2019 2018 2019 2018
Cash collected from clients $80,500 $74,500 $80,500 $74,500
Purchased supplies (4,000) (2,500) (4,000) (2,500)
Rent paid in cash (7,000) (3,000) (7,000) (3,000)
Prepaid insurance (5,500) (5,500)
Net operating cash flows $64,000 $69,000 $64,000 $69,000
Explanation:
The net income reported the accrual basis and that reported under the cash basis are different. The accrual basis considers all revenue whether actually received or not, the cash basis only considers cash received from clients in each period. However, the net operating cash flows under the two bases are the same. The reason for this is that only actual cash flows are considered under the two bases.
If you receive 10 units of utility from consuming one cup of coffee and 16 units of utility from consuming two cups of coffee, which of the following is the likely amount of utility you will receive from consuming three cups of coffee?
Answer:
26
Explanation:
Answer:
18
Explanation:
1 unit= 10 2 units =16 2/16= 8
3 cups is 18
Issued 30,000 shares of common stock in exchange for $300,000 in cash. Purchased equipment at a cost of $40,000. $10,000 cash was paid and a notes payable to the seller was signed for the balance owed. Purchased inventory on account at a cost of $90,000. The company uses the perpetual inventory system. Credit sales for the month totaled $120,000. The cost of the goods sold was $70,000. Paid $5,000 in rent on the warehouse building for the month of March. Paid $6,000 to an insurance company for fire and liability insurance for a one-year period beginning April 1, 2021. Paid $70,000 on account for the merchandise purchased in 3. Collected $55,000 from customers on account. Recorded depreciation expense of $1,000 for the month on the equipment. Post the above transactions to the below T-accounts.
Answer:
T-accounts:
Cash
Accounts Titles Debit Credit
Common Stock $300,000
Equipment $10,000
Rent Expense 5,000
Prepaid Insurance 6,000
Accounts Payable 70,000
Accounts Receivable 55,000
Equipment
Accounts Titles Debit Credit
Cash $10,000
Notes Payable 30,000
Notes Payable
Accounts Titles Debit Credit
Equipment $30,000
Inventory
Accounts Titles Debit Credit
Accounts Payable $90,000
Cost of Goods Sold $70,000
Accounts Payable
Accounts Titles Debit Credit
Inventory $90,000
Cash $70,000
Accounts Receivable
Accounts Titles Debit Credit
Sales Revenue $120,000
Sales Revenue
Accounts Titles Debit Credit
Accounts Receivable $120,000
Cost of Goods Sold
Accounts Titles Debit Credit
Inventory $70,000
Rent Expense
Accounts Titles Debit Credit
Cash $5,000
Prepaid Insurance
Accounts Titles Debit Credit
Cash $6,000
Common Stock
Accounts Titles Debit Credit
Cash $300,000
Depreciation Expense
Accounts Titles Debit Credit
Acc Depreciation $1,000
Accumulated Depreciation - Equipment
Accounts Titles Debit Credit
Depreciation Expense $1,000
Explanation:
T-account consists of the following. An account title to record the corresponding account where the double-entry transaction is completed. A debit side on the left to enter the dollar value of the transaction, if the concerned account receives the value. A credit side on the right, also, to enter the dollar value of the transaction, if the concerned account gives out the value.
Time-tested practices for developing successful teams are Multiple Choice showing enthusiasm, making timely decisions, practicing innovation. admitting mistakes, being flexible, having persistence. giving credit to others, keeping people informed, keeping promises. putting others first and self last. all of these.
Answer:
all of these.
Explanation:
Time-tested practices can be regarded as methods , ways that has been usings for long period of time that has produced a successful teams and can be trusted any time. It should be noted that Time-tested practices for developing successful teams are the followings;
✓showing enthusiasm
✓making timely decisions
✓ practicing innovation
✓admitting mistakes
✓ being flexible,
What are the five components of internal control briefly explain each component?
Answer: The five components of internal control are control environment, risk assessment, control activities, information and communication, and monitoring.
Explanation:
The five components of internal control are control environment, risk assessment, control activities, information and communication, and monitoring.
Control environment; is also known as internal control environment. These are set of standards and structures that guides the basis of carrying out internal control within an organization. It is the awareness, attitude and action of the management team regarding internal control and it's relevance to the organization
Risk assessment is used to describe the process and method of identifying hazard and risk which have potentials to raise harm in an environment
Control activities are policies, techniques and procedures that are pit in place to manage or reduce risk in an environment. Their actions carried out to minimize or limit risk in an environment
Information and communication is a method of information being passed through systems by means of communication. To place everyone involved in the system enlightened by communicating properly to them.
Monitoring is the act of observing a process to control both success and failure that may tend to arise within the process.
The Tinsley Company exchanged land that it had been holding for future plant expansion for a more suitable parcel located farther from residential areas. Tinsley carried the land at its original cost of $62,500. According to an independent appraisal, the land currently is worth $150,000. Tinsley paid $25,000 in cash to complete the transaction. Required: 1. What is the fair value of the new parcel of land received by Tinsley assuming the exchange has commercial substance
Answer:
$175,000
Explanation:
When an exchange transaction has commercial substance, the accounting standard IAS 16 requires that the cost price of the item acquired be at fair Value of the asset given up.
Fair Value of Asset given up is $150,000.
However Tinsley has also paid a trade -in allowance for the new parcel of land of $25,000.
Therefore, the fair value of the new parcel of land received by Tinsley assuming the exchange has commercial substance is $175,000 ($150,000 + $25,000)
On October 1, Bandor Company sold land (that cost $30,000) on credit for $35,000. The buyer issued an 8%, 12-month note for this amount, with the interest to be paid on the maturity date. Required: Prepare journal entries to record the sale of the land and the related year-end adjusting entry.
Answer:
Date Account Titles Debit Credit
Oct 01 8% Note Receivables $35,000
Land $30,000
Gain on sale $5,000
(To record the sale of the land)
Dec 31 Interest receivable $700
Interest Revenue $700
(35,000*8%*3/12)
(To record Interest Revenue on Note for 3 month recognized)
