XYZ company bought a car with a list price of $30,000. They had to pay $1,500 sales tax in addition to the $30,000 cost. What would happen? O The car would be valued on the balance sheet on the day of acquisition at $31,500. O The car would be valued on the balance sheet at $30,000. O The car would be valued on the balance sheet at $28,500. O XYZ company would have tax expense of $1500.

XYZ company bought a car with a list price of $30,000. They had to pay $1,500 sales tax in addition to the $30,000 cost. What would happen? O The car would be valued on the balance sheet on the day of acquisition at $31,500. O The car would be valued on the balance sheet at $30,000. O The car would be valued on the balance sheet at $28,500. O XYZ company would have tax expense of $1500.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

2. The company "Bom investor, Lda" needs to replace a heavy vehicle for which it has two alternatives: rent or purchase. In the case of acquisition, the price of the vehicle is €140,000, depreciated on a straight-line basis at the rate of 25% per year. After 4 years, the company plans to sell the vehicle for €30,000. In return for the acquisition, the rental implies the payment of semi-annual installments in arrears, the first rent of €15,000 and the rest subject to an update of 10% per year. a) Assuming an 8% discount rate and a 21% tax rate, which of the two options is the most favorable - rent or purchase? b) If the company in question expected losses for the next four years, to what extent would that affect decision analysis?
A few years ago, Largo Industries implemented an inventory auditing system at an installed cost of $176,000. Since then, it has taken depreciation deductions totaling $124,960. What is the system's current book value? If Largo sold the system for $111,000, how much recaptured depreciation would result?
Bryson Sciences is planning to purchase a high-powered microscopy machine for $55,000 and incur an additional $7,500 in installation expenses. It is replacing sim- ilar microscopy equipment that can be sold to net $35,000, resulting in taxes from a gain on the sale of $11,250. Because of this transaction, current assets will increase by $6,000 and current liabilities will increase by $4,000. Calculate the initial invest- ment in the high-powered microscopy machine.
Byrde Company purchased a truck. The seller asked for $11,400, but Byrde paid only $10,400 after negotiation. The owner of Byrde Company believes he got a great deal and the truck is really worth $15,400. What anmount does Byrde record on its financial statements for the truck?
Firm X is considering the replacement of an old machine with one that has a purchase price of $70,000. The current market value of the old machine is $22,000 but the book value is $ 37,000. The firm's combined tax rate is 27%. What is the net cash outflow for the new machine after considering the sale of the old machine? Disregard the effect of depreciation of the new machine if acquired.
Provide Answer with calculation and explanation
Mr. Pans owns and operates several retail auto parts and accessories outlets. Management is now considering the possibility of terminating the operation of the Accessories Store and leasing the facilities to another retailer. The monthly results of the Accessories Store operations are as follows: Sales P940,000 · Operating expenses directly identifiable with the outlet: Cost of goods sold, etc P890,000 Depreciation 80,000 If operation of Accessories Store is terminated, Mr. Pans can rent-out the facilities for P60,000 a month to a non-competing business. Determine whether the company should continue operations or terminate the Accessories Store and rent-out the facilities. How much is the advantage of better option? 1. Coniinue the Accessories Store – advantage of P 50,000 2. Terminate operation of Accessories Store - advantage of P50,000 3. Continue the Accessories Store - advantage of P10,000 | 4. Terminate operation of Accessories Store - advantage of P10,000
Your company has to liquidate some equipment that is being replaced. The originally cost of the equipment is $100,000. The firm has deprecated 65% of the original cost. The salvage value of the equipment today is $50,000. The firm has a tax rate of 30%. What is the equipment’s after-tax net salvage value? Please show your work.
As a result of the transaction, what is the effect on the profit or loss? what is the cost of the new asset acquired? with computations
Give me excel file
1. Assume Trois Cuisines Manufacturing bought three machines in a $100,000 lump-sum purchase. An independent appraiser valued the machines as follows: (1) Trois Cuisines paid one-third in cash and signed a note payable for the remainder. What is each machine’s individual cost? (2) Immediately after making this purchase, Trois Cuisines sold machine 2 for its appraised value. What is the result of the sale? Round to three decimal places. The result of the sale a _____ of $_____. Prepare the journal entry to record the sale. Please show all steps.
An old automobile is traded for a new automobile with a list price of $30,000. The old automobile has a net book value of $5,000, but the dealer has given $6,000 trade-in allowance, so the total purchase price is $24,000. The automobile will be depreciated according to the five-year MACRS class. Determine the cost basis to use and compute the MACRS percentages and the depreciation amounts for the new automobile.