So an impairment loss would be recognized for $200,000($1,100,000- $900,000). Question #2 Under U.S. GAAP, assets are tested for impairment when events or changes in circumstances indicate that book value may not be recoverable. For the building in Italy, again there is no information provided that says that there have been indicators that book value may not be recoverable. So a possible outcome in this situation could be that no investigation even take place and no impairment be recognized. If there are indicators which aren’t presented in the text, an impairment loss is required only when the undiscounted sum of estimated future cash
| The idea that money available at the present time is worth more than the same amount in the future due to its potential earning capacity. Provided money can earn interest, any amount is worth more the sooner it is received (“Time Value of Money,” n.d.). | Provide a real-world example for the time value of money. | An example would be depositing money into a savings account now and letting it earn interest. This amount of money will be worth more later because it will earn interest.
Mere realization of an asset will be the best description for this transaction (Scottish Australian Mining Co Ltd v FCT (1950)), the profit was not assessable as proceeds was not ordinary income. However, according to The Taxation Ruling TR92/3 in this case, Mary does not show any intention or purpose in entering into this transaction to make a profit (FCT v Whitfords Beach Pty Ltd – 82 ATC 4031). Lastly, Mary has discussed with the local estate agent and decided to subdivide the balance of eight hectares into four subdivided lots. Finally she sold two lots by 30th June 2013 for $200,000. By doing this, we can be seen that this transaction is for commercial purpose, so the profit for selling two lots which is $400,000 is added to assessable income (FCT v Whitfords Beach Pty Ltd-82 ATC 403).
d) The equilibrium interest rate increases to bring desired investment into equilibrium with the reduced quantity of national saving. e) The equilibrium quantity of investment is reduced via the increase in the interest rate by an amount equal to the increase in government spending. Question 5 (15 marks) a) capital is added. No, MPK does not diminish because it does not decline as more is also acceptable. b) L = 100: L = 110: L = 120: 0. .
Terminal assigned its rights to Wells Fargo (plaintiff). Terminal never paid a portion of the $250,000. Brooks refused to make monthly payments and Wells Fargo sued. Parties moved for summary judgement. Court ruled in favor of Wells Fargo, brooks appealed ISSUE: Even though a company is acting in good faith should they be held liable for contract duties?
In April 1999 the IRS issued a deficiency notice disallowing the deductions because of section 469’s passive activity rules. The Carter Trust paid the disputed tax in full plus interest and made a timely refund claim, which the IRS denied. The trust then sued for a refund in district court. The court found the IRS’s contention that the trust’s participation in the ranch operations should be measured by referring to the trustee’s activities had no support within the plain meaning of the statute. The court said this position was arbitrary and subverted common sense and, in the absence of case law or regulations, the IRS should not create ambiguity where there was none.
A C Corporation is considered an entirely separate entity and those that make up the company such as officers, directors, managers, and shareholders are not personally liable for the acts of the company. This is the main advantage of a C Corporation. A disadvantage is that profits of the corporation are taxed at two different levels. One at the corporate level and then another on the dividends of the shareholders. · Liability-A C Corporation has limited liability in that it is seen as a separate entity from the owners, which in turn protects their personal assets from being taken to pay for the company’s debt or liability losses.
| LIT 1 Task 310.1.2-01-06| By: Bryan Luttman| | 12/01/2012| LIT 1 Task 1 Part A Sole Proprietorship - It is a business that identifies itself with the owners name or a fictitious name. It also names the owner responsible for its debts. A sole proprietorship is not a legal entity and is the simplest form of under which a business can operate. The sole proprietorship is the easiest and most popular form of business for small business owners. The owner does not need to register his or her name and get a local license in order to do business, unless it is under a fictitious name.
Sheltering new industries may pay off later 4. Free trade allows companies the possibility of outsourcing the production of goods for domestic sale. Question No.3: Identify the major fallacies of international trade? Answer: 1. One fallacy is that trade is a zero sum activity, if one trading party gains, the other must lost.
The number of winning competitive bids average 39.9, but varied widely between the minimum of 2 and the maximum of 157. For the noncompetitive bid having an average of 33.7 with the maximum of 69 and minimum of zero well, this is because an auction was cancelled completely in August 1998. More also, calculating the quantity-weighted variance of winning bid price using this: ∑_(i=1)^N▒〖(b_i - b_w)〗 2 * V_i ∕ ∑_(i=1)^N▒Vi Where b_i: Price of the ith winning