Fixed assets turnover ratio: Fixed assets play a major in the contribution of revenue to the company and they are significant for the efficient and continuous operation of the day to the day business. Fixed assets turnover ratio is used to measure how efficiently the company is using its fixed assets to generate revenue and if the company is more efficient then the ratio will be higher. Requirement 1: Compute fixed assets turnover ratio for 2019 of Tabor industries.
Fixed assets turnover ratio: Fixed assets play a major in the contribution of revenue to the company and they are significant for the efficient and continuous operation of the day to the day business. Fixed assets turnover ratio is used to measure how efficiently the company is using its fixed assets to generate revenue and if the company is more efficient then the ratio will be higher. Requirement 1: Compute fixed assets turnover ratio for 2019 of Tabor industries.
Solution Summary: The author explains that fixed assets play a major role in the contribution of revenue to the company and they are significant for the efficient and continuous operation of the day to day business.
Fixed assets play a major in the contribution of revenue to the company and they are significant for the efficient and continuous operation of the day to the day business. Fixed assets turnover ratio is used to measure how efficiently the company is using its fixed assets to generate revenue and if the company is more efficient then the ratio will be higher.
Requirement 1:
Compute fixed assets turnover ratio for 2019 of Tabor industries.
To determine
Concept introduction:
Average age of fixed assets:
In addition to fixed assets ratio another important calculation is the average age of the fixed assets because older assets are less efficient than the newer assets. This calculation the managers to determine the capital replacement policy and future capital expenditures.
Requirement 2:
To explain:
Compute the average age of fixed assets for 2019 of Tabor industries.
To determine
Concept introduction:
Fixed assets turnover ratio:
Fixed assets play a major in the contribution of revenue to the company and they are significant for the efficient and continuous operation of the day to the day business. Fixed assets turnover ratio is used to measure how efficiently the company is using its fixed assets to generate revenue and if the company is more efficient then the ratio will be higher.
Average age of fixed assets:
In addition to fixed assets ratio another important calculation is the average age of the fixed assets because older assets are less efficient than the newer assets. This calculation the managers to determine the capital replacement policy and future capital expenditures.
Requirement 3:
To explain:
To comment on fixed assets turnover ratio and the average age of the fixed assets of tabor industries.
A company owns a machine with a $10,000 carrying value, $5,000 estimated salvage value, and $90,000 fair value. The machine was irreparably damaged by a customer and, as a result, was deemed worthless. A court awarded damages of $90,000 in favor of the company. At the current year end, the outcome of this case was awaiting appeal and was, therefore, uncertain. However, the company's legal counsel believes the appeal will be denied. What amount of gain, if any, should the company report for this lawsuit in its current-year financial statements?
A.
$0
B.
$75,000
C.
$80,000
D.
$90,000
Accumulated other comprehensive income?
Chapter 7 Solutions
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