Intention of liquidating investment

Assignment Help Financial Accounting
Reference no: EM133291096

Question

You have been asked to review the December 31, 2021, balance sheet for Exclusive Child Care. After completing your review, you list the following three items for discussion with your supervisor. After the discussion, determine the appropriate classification of each of these items.

An investment of $50,000 is included in current assets. Management has indicated that is has no intention of liquidating the investment in 2022.

A $100,000 note payable is listed as a long-term liability, but you have determined that the note is due in 10 equal annual installments due on March 31, 2022.

Deferred revenue of $70,000 is included as a current liability even though only two-thirds will be recognized as revenue in 2022, and the other one-third in 2023.

Reference no: EM133291096

Questions Cloud

How does the cost of equity change : FINA 3361 Saint Mary's University How does the cost of equity change if we impose a 30% corporate tax while the unlevered beta remains the same
Did castleberry have any grounds to hold branscum liable : Castleberry was paid only $1,000 of the $42,000 promissory note. Did Castleberry have any grounds to hold Branscum liable for the unpaid portion of the note?
What is price of new bravo bonds : Bravo, Inc., just issued a corporate bond in this same environment. What is the price of the new Bravo bonds after the increase in YTM?
What is the npv of the stock offer : Penn is trying to decide whether it should offer 33% of its stock or $39155850 in cash to Teller's shareholders. What is the NPV of the stock offer
Intention of liquidating investment : An investment of $50,000 is included in current assets. Management has indicated that is has no intention of liquidating the investment in 2022.
What is the maximum lease payment acceptable to wildcat : Suppose it is estimated that the equipment will have an aftertax residual value of $720,000 at the end of the lease. What is the maximum lease payment
Discuss pillars tangible ways in which business leaders : Discussion of these pillars address tangible ways in which business leaders can bring these ideas to life and meaningfully impact the culture of these firms.
Why might many college graduates find student loan debt : BUSINESS 101 American Samoa Community College Why might many college graduates find student loan debt more of a barrier to buying a house than credit card debt?
Self-employed psychologist : Paul is 35 years old and is a self-employed psychologist. Provide a balanced argument based on review of literature relating to the usefulness of risk profile.

Reviews

Write a Review

Financial Accounting Questions & Answers

  What was the owner equity at the beginning

The following information relates to JJ Manufacturers as at 31 August 20X7: What was owner's equity at the beginning of the financial year to 31 August 20X7

  Journalize the entry to close the income summary

Calculate the amount of income each partner will receive under their profit and loss sharing agreement and journalize the entry to close the Income summary account for the year.

  What is the amount of the cca tax shield

The firm can borrow money at 8.5 percent and has a 34 percent tax rate. What is the amount of the CCA tax shield in year 4

  Calculate under armours receivables turnover

Looking at the same note, what was Under Armour's allowance for doubtful accounts in 2009 and 2008 and was a larger percentage of the gross accounts receivable considered uncollectible at December 31, 2008 or 2009?

  What is the net cash provided by financing activities

What is the net cash provided by financing activities? Proceeds from issuance of ordinary shares 2,000,000.Net income 4,500,000

  Which is a main concern raised about the recognition of land

Which is a main concern raised about the recognition of land under roads? If borrowing costs are capitalised, capitalisation continues?

  Prepare the appropriate journal entry to record the award

Prepare the appropriate journal entry to record the award of restricted shares on January 1, 2013. Prepare the appropriate journal entry to record compensation expense on December 31, 2013.

  What is the new wacc

What is the new WACC if you take the average of the CAPM and dividend growth models to estimate the cost of equity. Assume a tax rate of 35%

  What is the current bond price

Three years ago, JKL Co. issued bonds with a 17-year maturity then and at a coupon rate of 7.6 percent. What is the current bond price

  What should the cost of the machine be in the balance sheet

The cost of the machine was £10,000. The installation costs were £1,000. What should the cost of the machine be in the balance sheet

  Journalize the purchase of smith company by jones manufactur

The fair market value of the receivables is equal to the amount reported on the balance sheet. The agreed purchase price was $1,850,000.

  Case study-adms inc

ADMS Inc. manufacturers mobile phone accessories and operates its own manufacturing plant in Ontario, Canada. ADMS Inc was established by Wong's family in 1999

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd