50 2 points Time Remaining 2 hours 3 minutes 41 seconds 02:03:41 1 Item 50 Item
ID: 2395575 • Letter: 5
Question
50
2 points
Time Remaining 2 hours 3 minutes 41 seconds
02:03:41
1
Item 50
Item 50 2 points
Time Remaining 2 hours 3 minutes 41 seconds
02:03:41
On March 15, 20X7, Barrel Company paid property taxes of $120,000 on its factory building for calendar year 20X7. On July 1, 20X7, Barrel made $20,000 in unanticipated repairs to its machinery. The repairs will benefit operations for the remainder of the calendar year. What total amount of these expenses should be included in Barrel's quarterly income statement for the three months ended September 30, 20X7?
Multiple Choice
$35,000
$40,000
$30,000
$50,000
Explanation / Answer
Solution:
Propert Taxes paid for the year 20X7 = $120,000
Repairs expemnses that will benefit for the period July 1 to Dec 31 = $20,000
Total amount of expenses for the three month period ending September 30 = Propert Taxes *3/12 + Repairs*3/6
= $120,000 *3/12 + $20,000*3/6 = $30,000 + $10,000 = $40,000
Hence second option "$40,000" is corect.
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.