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!
How would you select an organizational form for a business? Think about this question as you read the following scenario.
Joe Jones has created a business plan for a new product. He is not certain whether to organize his business as a regular corporation or a sole proprietorship. The following are his forecasted partial financial statements for the first four years of operation of the new venture named Uncle Joe's.
Forecasted partial Income Statement:
Year 1
Year 2
Year 3
Year 4
Sales
$15,000
$18,000
$23,400
$44,460
Cost of goods sold
8,000
10,000
15,000
21,000
Gross profit
7,000
8,400
23,460
Operating expenses
3,000
4,500
4,900
12,000
Interest
800
1,800
2,100
4,100
Earnings before taxes
2,200
2,700
2,800
7,900
Taxes
?
Net Income
Forecasted Balance Sheet:
Cash and inventories
$30,000
$45,000
$67,500
$101,250
Building and equipment
25,000
32,500
42,250
54,925
Total assets
55,000
77,500
109,750
156,175
Corporate Income Tax Schedule:
Taxable Income
Marginal Tax Rate
$1-30,000
10%
30,001-100,000
18
100,001-400,000
23
400,001-5,000,000
30
Over 5,000,000
40
Personal Income Tax Schedule:
$1-5,000
8%
5,001-20,000
12
20,001-60,000
19
60,001-180,000
25
Over 180,000
33
Using the information on Uncle Joes' finances, answer the following questions:
Do you recommend that Joe form a corporation or a sole proprietorship? Justify your answer
Stang Sports Equipment Company made 40,000 basketballs in a given year. Its manufacturing costs were $288,000 variable and $95,000 fixed. Suppose that no price changes will take place in the following year and that no changes in production techniq..
Recognize which costing system - job order or process cost - the following companies would use:
Costs can be classified into 2 categories, fixed and variable costs. These costs behave differently based on the level of sales volume. Suppose we are running a restaurant and have identified certain costs along with the number of annual training ..
Barone Supply bought equipment at a cost of $48,000 on January 2, 1997. It originally had an estimated life of ten years and a salvage value of $8,000. Barone uses the straight-line depreciation method. On December 31, 2000
Mattresses-A-Million produces Pillow-Top mattresses. They have been using a volume-based costing system to allocate overhead based on direct labor-hours. The Pillow-Top requires two hours of direct labor.
Calculate the increase or decrease in profits for the three divisions and the company as a whole (four separate computations) if the agreement is enforced. Explain your thought process, comment on the situation, and make a suggestion based on the com..
Martin Company is a two-division firm and has following information available for this year:
How many autoimmunity tests per year will have to be performed on the array machine to break even and given the present volume of tests, would there be an annual net contribution and, if so, how much?
Describe the major methods of developing the advertising budget. Make sure you take the position on which method you think is best and why.
Evaluate Pursco's foreign tax credit limitation under the subsequent independent assumptions.
Evaluate and use quantitative and qualitative information to measure financial and non financial performance of an organisation
Sunshine Oil Company buys crude vegetable oil. Processing this oil results in four products at the split off points: A, B, C, and D. Product C is fully processed at the split off point.
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