On January 1, 2021, BBX issued $400,000 of its 8% bonds for $368,000. The bonds were priced to yield 10%. Interest is payable se

Answer:

A.

Depreciation Expense for the first year: $14,400

For the second year’s depreciation expense: $11,520

B.

The depreciation expense for the first year is equal to the second year’s depreciation expense = $7,200

Explanation:

A.Using the straight-line method, the asset has a useful life of 10 years, meaning its annual depreciation represents 10% of the depreciable cost.

Calculating the depreciable cost results in = Total cost of the asset - salvage value =  $80,000-$8,000 = $72,000

With the double-declining-balance method, the straight-line rate of 10% is increased to 20%, which is then applied to the book value of the depreciable cost at the start of each year.

For the first year, the depreciation expense is calculated as 20% of $72,000  = $14,400

At the onset of the second year, the book value of the depreciable cost is $72,000 -$14,400 = $57,600

The depreciation expense for the second year is then 20% of $57,600  = $11,520

B.

The organization adopts straight-line depreciation, calculating Depreciation Expense for each year using the following formula:  

Depreciation Expense = (Cost of the machine − salvage value)/Useful Life = ($80,000-$8,000)/10 = $7,200

Thus, the first year’s Depreciation Expense = the same value as the second year’s depreciation expense = $7,200

Answer:

possessing value in the marketplace

Result:

The direct labor rate variance is positive $3,400.

Details:

Here’s the information we have:

The total actual labor cost for the company was $200,600, which covered 17,000 direct labor hours. The standard cost per hour is $12.

To find the direct labor rate variance, we begin by determining the actual rate.

Actual rate = $200,600 / 17,000 = $11.8 per hour.

Now we can compute the direct labor rate variance:

Direct labor rate variance = (Standard Rate - Actual Rate) * Actual Quantity

Direct labor rate variance = (12 - 11.8) * 17,000 = positive $3,400.

This variance is favorable as the actual rate was less than the standard rate.

Response:

$54,600

Details:

Cash Budget for Q3

                                                July              Aug                  Sep

Income:

Cash Inflows                    $25,000      $22,000          $20,000

Aggregate Income                $25,000      $22,000          $20,000

Outflows:

Inventory Acquisitions       $5,800       $7,000               $6,200

Operating Costs               $3,500       $4,600               $5,300

Total Outflows                  $9,300       $11,600              $11,500

Net Income                       $15,700      $10,400              $8,500

Carryover Balance               $20,000      $35,700            $46,100

Ending Balance                    $35,700      $46,100            $54,600

Thus,

The expected cash balance at the conclusion of September amounts to $54,600