Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
At the beginning of 2014, the Healthy Life Food Company purchased equipment for $42 million to be used in the manufacture of a new line of gourmet frozen foods. The equipment was estimated to have a 10-year service life and no residual value. The straight-line depreciation method was used to measure depreciation for 2014 and 2015. Late in 2016, it became apparent that sales of the new frozen food line were significantly below expectations. The company decided to continue production for two more years (2017 and 2018) and then discontinue the line. At that time, the equipment will be sold for minimal scrap values. The controller, Heather Meyer, was asked by Harvey Dent, the company's chief executive officer (CEO), to determine the appropriate treatment of the change in service life of the equipment. Heather determined that there has been an impairment of value requiring an immediate write-down of the equipment of $12,900,000. The remaining book value would then be depreciated over the equipment's revised service life. The CEO does not like Heather's conclusion because of the effect it would have on 2016 income. “Looks like a simple revision in service life from 10 years to 5 years to me,” Dent concluded. “Let's go with it that way, Heather.” Required: What is the difference in before-tax income between the CEO's and Heather's treatment of the situation? Discuss Heather Meyer's ethical dilemma.
Henderson Company had an unadjusted cash balance of $8,950 as of May 31. The company’s bank statement, also dated May 31, included a $200 NSF check written by one of Henderson’s customers. Determine the true cash balance as of May 31.
Why would a company decide to change its depreciation, depletion, or amortization method? What are some circumstances that could cause an asset to become impaired?
Price Mart is considering outsourcing its billing operations. A consultant estimates that outsourcing should result in after-tax cash savings of $9,000 the first year, $15,000 for the next two years, and $18,000 for the next two years. Interest is at..
The current level of the S&P 500 is 1,200. The dividend yield on the S&P 500 is 2%. The risk-free interest rate is 1%. What should a futures contract with a one-year maturity be selling for?
As SP6, you prepare the worksheet for this problem. You can use the posted excel worksheet which has been started and shows totals for the debits and credits in the consolidating entries columns. We'll start the problem here so you will have all the ..
John Wilson is a 42-year-old computer programmer, husband, and father of four. He wants to use the capital retention approach to determine how much life insurance he should purchase. Because of his $105,000 salary and their four children.
Maria opens a retirement account with a deposit of 1260 dollars. Each year, she makes another deposit that is 2.7 percent larger than the previous deposit. If the account pays an effective annual rate of interest of 8.4 percent, calculate the accumul..
Briefly show the accounting treatment of purchased goodwill. Briefly describe impairment concept in relation to intangible assets, with reference to relevant accounting standards
Alopecia Hair Tonic Corporation is considering an investment project that is expected to generate net cash inflows of $65,000 per year for 4 years. The only initial investment funds required will be a $150,000 increase in working capital. The net pre..
Using a spreadsheet program like Excel, calculate the NPV and IRR of the following scenario:
The growth rate in dividends is expected to be constant at 4% per year. If the stock is selling for $50 per share, what is the required rate of return?
Alvin Inc. planned and actually manufactured 200,000 units of its single product in 2008, its first year of operations. Variable manufacturing costs were $30 per unit of product. Planned and actual fixed manufacturing costs were $600,000, and marketi..
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!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd