Videos
Concept Introduction:
Good will: Good will is an intangible asset which is either created or purchased.
Requirement-a:
To Indicate:
The decision to pay more for purchase of the restaurant
Concept Introduction:
Good will: Good will is an intangible asset which is either created or purchased. Goodwill can be explained as the name, fame or market impression of the title. Accounting treatment for purchased and self generated good will is different. Goodwill can be recorded with a value, so a purchased good will can be recorded with its value, but the value of self generated good will is unascertainable, hence the self generated good will is not recorded in the books.
Return on Investment (ROI): The return on investment is a profitability ratio that measures the percentage of profit earned on the investment made. It is calculated with the help of following formula:
Requirement-b:
To Indicate:
The accounts titles to record the cost of the restaurant
Want to see the full answer?
Check out a sample textbook solution
Chapter 6 Solutions
Accounting: What the Numbers Mean
- I need help completing my discussion post. Consumer laws are needed to protect buyers from being exploited when purchasing goods and services and to regulate the transactions between consumers and sellers. The federal agency that creates and enforces consumer protection law is the Federal Trade Commission. What purpose does the Federal Trade Commission serve and why must business owners be educated on Federal Trade Commission practices? Considering 1 of the following sections of the Federal Trade Commission Act: Deceptive Advertising Labeling and Packaging Laws Credit Protection Regarding the section you chose, provide an example of when a deceptive practice has been used in business and the consequence(s) for the deceptive practice.arrow_forwardPlease provide the accurate answer to this general accounting problem using appropriate methods.arrow_forwardWhat is the annual depreciation expense?arrow_forward
- Accounting solutionsarrow_forwardSubject = General Accountarrow_forwardInnovative Products operations for the year produced a margin of safety (M/S) ratio of 30% and a contribution margin (C/M) ratio of 60%. The company's fixed costs amounted to $75,000. Compute and interpret the following: Contribution Provide answerarrow_forward
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education