Reference no: EM132935457
Question - You are trying to determine your company's accrual-based net income at the end of the 2020. Your company has provided you with a net income dollar amount of $175,000 for its 2020 calendar year period. The net income figure provided does not reflect any year end adjusting entries. Your assistant has determined that the following entries the company made during 2020 and other information may require adjustments to the net income amount the company provided.
-May 1: Purchased a machine for $32,000. The company is depreciating the machine in an annual amount of $3,600 per year.
-July 1: Paid $24,000 for a two-year insurance premium, which was debited to Prepaid Expenses for that amount.
-September 1: Loaned $6,000 to an officer of the company who will repay the loan principal and interest in one year at an annual interest rate of 14 percent.
-October 1: Received $1,200 rent payment for the period December 1 of the current year to April 1 of next year. The payment was credited to Unearned Rent Revenue.
-December 31: Determined it owed wages to 10 employees who each worked four days at $200 per day at the end of the current year. The company will pay employees at the end of the first week of the next year.
-The company uses the percentage of sales method of estimating bad debts. Its sales for 2020 were $100,000 and it uses an estimate of uncollectible accounts of 2% of sales. During the year, the company wrote-off $500 in uncollectible accounts. At year end the allowance for doubtful accounts had a credit balance of $1,500.
Required - Compute the company's net income for the 2020 calendar year. Show your work.
|
What was the gain or loss recognized by bts
: Accrued interest was appropriately recorded prior to discounting. What was the gain or loss recognized by BTS on the sale of notes receivable
|
|
How many years did take out the loan
: Amy borrowed $12,000 at an annual simple interest rate of 10.5% and repaid the loan by paying a lump sum of $15,300. For how many years did take out the loan
|
|
Construct the break-even chart for this operation
: Construct the break-even chart for this operation and determine the sales value that the firm will have to reach if it is to make $20,000 profit per period
|
|
What is the balance in account at the end of thirteen years
: 8 years in to the savings account, and the interest rate rises to 9% compounded semi-annually. What is the balance in the account at the end of 13 years?
|
|
Compute the company net income
: July 1: Paid $24,000 for a two-year insurance premium, which was debited to Prepaid Expenses for that amount. Compute the company net income
|
|
Find what is the approximate current value of firm shares
: 4% each year for the foreseeable future. If the required rate of return on these shares is 12%, what is the approximate current value of the firm's shares?
|
|
What is the value of the firm shares for company
: If the company just paid a cash dividend of $1.20, and the required rate of return is 13%, what is the value of the firm's shares?
|
|
What parts of the legal framework will impact on this risk
: Case Study - Alibaba and the 40,000 Thieves - What parts of the legal framework will impact on this risk? What areas does your risk address
|
|
Find what is the current value of the firm shares
: Dividends of $3.50 are expected to re-commence in 6 years. If the required rate of return is 11%, what is the current value of the firm's shares?
|