Midtown, Inc. had the following transactions in 2018, its first year of operations:
• Issued 31,000 shares of common stock. Stock has par value of $1.00 per share and was issued at $20.00 per share.
• Earned net income of $70,000.
• Paid no dividends.
At the end of 2018, what is total stockholders' equity?
A) $31,000
B) $690,000
C) $620,000
D) $70,000
B) $690,000
Common stock (31,000 × $20) $620,000
Net income $70,000
Total stockholders' equity $690,000
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In 2015, Morton Cosold 150 hot air balloons at $4,000 each. The balloons carry a 5-year warranty for defects. Morton estimates that repair costs will average 4% of the total selling price. The estimated warranty liability at the beginning of the year was $14,000 . $20,000 in claims was actually incurred during the year to honor their warranty. What was the warranty expense for 2015?
a. $10,000 b. $18,000 c. $20,000 d. $24,000
According to the cooperative principle, the ______ maxim controls our topics of talk and suggests that diverting focus or shifting “off topic” violates expectations of interaction.
a. quality b. quantity c. relevance d. manner
Answer the following statements true (T) or false (F)
1. The specific purpose of your speech should be a 2–3-sentence statement. 2. If your specific purpose and thesis are clearly formulated, it will be easy for you to identify your speech’s main points. 3. One factor that influences your credibility is the quality and relevance of your supporting materials. 4. You should indicate in your outline where you plan to use visual aids.
Which of the following capital budgeting methods might not consider the salvage value of a machine being considered for purchase?
A) Internal Rate of Return B) Net present value C) Payback D) Profitability Index