On-Time Delivery Company acquired an adjacent lot to construct a new warehouse, paying $90,000 in cash and giving a short-term note for $50,000. Legal fees paid were $1,750, delinquent taxes assumed were $25,000, and fees paid to remove an old building from the land were $9,000. Materials salvaged from the demolition of the building were sold for $1,000. A contractor was paid $415,000 to construct a new warehouse. Determine the cost of the land to be reported on the balance sheet.
Answers
Answer:
The cost of land to be reported is $174,750
Explanation:
The cost of land reported in the Balance sheet does not only include the price paid to acquire the Land but also include any costs/revenue received in the processes, activities needed to bring the land to the stage in which it may be ready for usage.
Thus, besides the price paid which is $140,000 ( $90,000 cash and $50,000 short-term note), we have to add-up all the relevant costs including Legal fees, delinquent taxes, Removal of old building expenses and deduct the material salvaged gain from demolition of old building. The construction cost of new warehouse is irrelevant here as without this cost, the Land is already in a ready-to-use stage ( i.e: for building new property in the Land)
So, the amount of Cost of Land to be reported is : 140K + 1,75K + 25K + 9K - 1K = $174,750
Final answer:
The cost of the land to be reported on the balance sheet is $174,750.
Explanation:
To determine the cost of the land to be reported on the balance sheet, we need to add up all the costs associated with acquiring and preparing the land. In this case, the costs include the cash payment of $90,000, the short-term note of $50,000, legal fees of $1,750, delinquent taxes of $25,000, and fees paid to remove the old building of $9,000. We then subtract the salvage value of the materials sold, which is $1,000. So the total cost of the land is:
Total cost of land = Cash payment + Short-term note + Legal fees + Delinquent taxes + Fees to remove old building - Salvage value of materials
= $90,000 + $50,000 + $1,750 + $25,000 + $9,000 - $1,000 = $174,750
Therefore, the cost of the land to be reported on the balance sheet is $174,750.
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Related Questions
Boatler Used Cadillac Co. requires $800,000 in financing over the next two years. The firm can borrow the funds for two years at 9 percent interest per year. Mr. Boatler decides to do forecasting and predicts that if he utilizes short-term financing instead, he will pay 6.75 percent interest in the first year and 10.55 percent interest in the second year. Determine the total two-year interest cost under each plan. Which plan is less costly?
Davidson offers several solutions to the major issues, stating that fiscally we are actually not a nation that is divided on the major issues. What are some of the fiscal solutions that he mentions tweaking?
If Wild Widgets, Inc., were an all-equity company, it would have a beta of .95. The company has a target debt-equity ratio of .40. The expected return on the market portfolio is 11 percent and Treasury bills currently yield 3.5 percent. The company has one bond issue outstanding that matures in 15 years and has a coupon rate of 6.5 percent. The bond currently sells for $1,080. The corporate tax rate is 21 percent.Required:a. What is the company's cost of debt? b. What is the company's cost of equity?c. What is the company's weighted average cost of capital?
The independent cases are listed below that includes all items relevant to operating activities: Case A Case B Case C Sales revenue $ 65,000 $ 55,000 $ 96,000 Cost of goods sold 35,000 26,000 65,000 Depreciation expense 10,000 2,000 26,000 Salaries and wages expense 5,000 13,000 8,000 Net income (loss) 15,000 14,000 (3,000) Accounts receivable increase (decrease) (1,000) 4,000 3,000 Inventory increase (decrease) 2,000 0 (3,000) Accounts payable increase (decrease) 0 2,500 (1,000) Salaries and wages payable increase (decrease) 1,500 (2,000) 1,000 Compute cash flows from operating activities using the direct method. (Amounts to be deducted should be indicated with a minus sign.) Case A Case B Case C Cash Collected from Customers Cash Payments to Suppliers Cash Payments for Salaries and Wages Net Cash Provided by Operating Activities $ 0 $ 0 $ 0
Answers
Answer:
Marketing mix.
Explanation:
Marketing mix is defined as a set of elements that make up marketing actions in an organization. According to Kotler, the purpose of the marketing mix is to help the company achieve its goals in the market by using a set of marketing tools.
There are several models developed to represent the marketing mix, but the most used by organizations is represented by four essential pillars for the development of any marketing strategy, which are the 4P's of marketing: product, price, place and promotion. For each variable there are distinct and relevant activities:
- Product: Differentiation of design, packaging, brand. Warranty Policy
- Price: Discounts and terms of payment and financing.
- Place: Store, distribution channel, logistics.
- Promotion: Advertising, promotions.
Danette uses a vehicle to deliver US mail to people who live in a city.
Gavin was elected as a city council member in his hometown.
Vito works in a US embassy in China helping Americans with paperwork.
Answers
Answer:
a and c
Explanation:
did it on edge 2020
Answer:
A and C! edge 2020!
Explanation:
Answers
Answer:
Variable overhead= $44,330
Fixed overhead= $29,600
Total overhead= $73,930
Explanation:
Giving the following information:
Total variable overhead= $45,760
Total fixed overhead= $29,600
Total overhead cost= $75,360
First, we need to calculate the variable predetermined overhead rate:
Variable predetermined overhead rate= 45,760/3,200= $14.3 per machine hour
Now, for 3,100 hours:
Variable overhead= 14.3*3,100= $44,330
Fixed overhead= $29,600
Total overhead= $73,930
Answers
Answer:
Incremental cost of buying the component = $69,500
Therefore the component shall be make in the company and shall not be bought from outside.
Explanation:
Provided the cost in case of manufacturing
65,000 units
Variable Cost = $1.9565,000 = $126,750
Fixed Cost = $75,000
Total cost of making the product = $126,750 + $75,000 = $201,750
Total cost in case of buying the product
Price to be paid = $3.25 65,000 = $211,250
Also the fixed cost of $60,000 will be incurred in any manner and is not avoidable.
In that case total cost of buying the product = $211,250 + $60,000 = $271,250
Incremental cost of buying the component = $271,250 - $201,750 = $69,500
Therefore the component shall be make in the company and shall not be bought from outside.
Final answer:
If Gilberto Company purchases the part externally, it will incur an extra cost of $12,750. Therefore, it is more cost-effective for the company to continue manufacturing the part in-house.
Explanation:
The first step is to calculate the total cost of producing 65,000 units in-house and the total cost of buying 65,000 units externally.
For in-house production: The cost is the sum of variable costs, fixed costs, and allocated costs, yielding: (65,000 units * $1.95/unit) + $75,000 + $62,000 = $198,500
For external purchasing: the total cost is simply 65,000 units * $3.25/unit = $211,250.
We subtract the in-house cost from the external purchasing cost to obtain the incremental cost: $211,250 - $198,500 = $12,750. Therefore, it costs an incremental $12,750 to buy 65,000 units externally compared to making them in-house. Considering the cost-effectiveness, Gilberto Company should continue to manufacture the parts in-house rather than buying them from the external supplier.
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Answers
Answer:
a. advocate redistributing income from David to Rita.
Explanation:
Since David is getting a lower utility from his last dollar obtained (6) than Rita (10), the benefit that David gains from this last dollar is less than what Rita would gain if she was the one receiving this dollar. Therefore, those who favor an equal distribution of income would advocate redistributing income from David to Rita, since total utility would increase with this redistribution.
Answers
Answer:
The Correct Option is "Economies of scale"
Explanation:
Economies of scale:
Economies of scale explain the reduction in per unit production costs caused by expansion of production. If a economy doubles its output each year causes the production costs to reduce by 30 percent, then it is an example of economies of scale.
Answer: Economies of scale.
Explanation:
Economies of scale is the saving in costs that is gained as a result of an increase in production level. It is the cost advantage that an organization experiences due to its increase in the level of output. The benefit occurs as a result of the inverse relationship that exists between quantity produced and per-unit fixed cost. The higher the quantity of output that is produced, the smaller the per unit fixed cost.
Economies of scale also brings about a reduction in the average variable costs when output increases. This is due to operational efficiencies which occurs as the scale of production increases. When the output is doubled, the reduction in costs by thirty percent is an example of economies of scale.