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!
Question - FastTrack Corporation is in need of cash to finance its operations. The company creates a new company, Flex Corporation, which is wholly owned by FastTrack. On October 1, Year 1, FastTrack sells inventory on credit to Flex for $600,000, which in turn immediately uses the inventory for a $480,000, 11% loan (guaranteed by FastTrack) from Georgia State Bank. Flex then uses the proceeds from the loan to repay $480,000 of the $600,000 owed to FastTrack. FastTrack agrees to continue to extend credit for 10 months to Flex for the remaining $120,000. The inventory is Flex's only asset and is stored in a public warehouse. FastTrack agrees to pay Flex the $2,500 monthly storage fee and $4,400 per month for a financing fee at the end of each month. FastTrack also agrees to repurchase the inventory from Flex for $600,000 at the end of August Year 2. FastTrack uses a perpetual inventory system; the cost of the inventory sold to Flex is $500,000. The president of FastTrack has asked you how to account for this series of transactions in Year 1.
REQUIRED: Research the related GAAP and prepare a short memo to the president that explains how FastTrack should record the sale of the inventory on October 1, Year 1, and the payment of the fees at the end of October, November and December. Also explain how FastTrack should report the recorded items in its Year 1 financial statements. Cite your reference and applicable paragraph numbers.
travel expenses. marilyn a business executive who lives and works in cleveland accepts a temporary out-of-town
XYZ Company accepted a national credit card for a $3,000 purchase. The cost of the goods sold is $2,400. The credit card company charges a 3% fee. What is the impact of this transaction on net operating income?
Discovery Barn, a not for profit science center for children, received a contribution of $30,000 explicitly designated for the acquisition of computers. During the year it acquired $21,000 of computers, which it estimated to have a useful life of thr..
Eagle Tools, Inc., the manufacturer of the gun, for product liability, on the ground of strict liability. What are the elements for an action based on strict liability? In whose favor is the court likely to rule?
hocking corporations comparative balance sheet appears belowthe companys net income for the year was 10000 and its cash
gelato supremo is a popular neighborhood gelato shop. the company has provided the following data concerning its
Assuming the exchange rate between Malaysian ringgits and U.S. dollars is $ 0.4538 on March 1 and $ 0.4899 on March 31, prepare the entries to record the sale on March 1 and the cash receipt on March 31.
No past history working with client in a direct manner (meaning working for the client as an employee)
In which of the following would there be a difference between financial and managerial accounting? Which of the following is a cost that changes inproportion to changes in volume?
a company is 40 financed by risk-free debt. the interest rate is 10 the expected market risk premium is 8 and the beta
At what level of expected fan sales would HHI be indifferent between making and buying the motors
A business has the following financial information at the end of the year: determine net cash flow from operating activities for the current year
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