1. Arden has the following information to evaluate: his current salary of $50,000 versus total revenue of $100,000 and expenses of $60,000 from starting a new business. How much is the opportunity cos associated with starting a new business?
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- Paula has the following information to evaluate—her current salary of $59,000 versus total revenues of $170,000 and expenses of $76,000 from starting a new business. How much is the opportunity cost associated with starting the new business?Sam quit a $30,000-a-year job with a local heating and air conditioningfirm to go into business for himself. After his first year in business, his accountant showed him an income statement, which indicated Sam’s firmhad a profit of $40,000. During this year, Sam drew a salary of $20,000.a. What were Sam’s accounting profit and entrepreneurial profit?b. Explain the difference between accounting profit and entrepreneurial profit.Ms. Muchomoney is incredibly wealthy and has a net worth of $1,000,000,000. She starts a business by giving $100,000 to the company and receiving stock in return. That is the only transaction to date this year. The new business's balance sheet would have: Group of answer choices Total owners' equity of $1,000,100,000. Total owners' equity of $100,000. No owners' equity Total owners' equity of $1,000,000,000.
- Upon graduating with an accounting degree, you open your own accounting firm of which you are the sole employee. To start the firm you passed on a job offer with a large accounting firm that offered you a salary of RM60,000 annually. Last year you earned a total revenue of RM100,000. Rent and supplies last year were RM50,000. 2.1) Your annual economic costs are __________. 2.2) Your annual economic profit is __________. 2.3) Your annual accounting profit is __________. 2.4) Based on the above information, describe the condition of your firm.On 1 January 2020, Michael invested £13,000 in a car wash business in front of his house. He used part of the money to buy equipment for £3,000 and supplies worth £1,000 good for 1.5 years. During the first year of operations, the business received only £5,000 after rendering car wash services. Michael prepared the following income statement for the year ended 31 December 2020. He asked your help to assess the presentation of the relevant information in his income statement. Michael Car Wash Income Statement For the year ended 31 December 2020 (£) Service revenue 5,000 Less expenses: Equipment 3,000 Supplies 1,000 Salaries 1,200 Electricity and water 150 Income tax 700 Net income (loss) for the month (1,050)…Upon graduating with an accounting degree, you open your own accounting firm of which you are the sole employee. To start the firm you passed on a job offer with a large accounting firm that offered you a salary of RM60,000 annually. Last year you earned a total revenue of RM100,000. Rent and supplies last year were RM50,000. Based on the above information, describe the condition of your firm.
- Suppose you are the only owner of a chain of coffee shops near universities. Your current cafés are doing well, but you are interested in starting a fine-dining restaurant. You decide to use the cash generated from your existing business to enter into a new business. Your accountant provides you with the following data on your current financial performance: Financial update as of June 15 • Your existing business generates $123,000 in EBIT. • The corporate tax rate applicable to your business is 25%. • The depreciation expense reported in the financial statements is $23,429. • You don’t need to spend any money for new equipment in your existing cafés; however, you do need $18,450 of additional cash. • You also need to purchase $9,840 in additional supplies—such as tableclothes and napkins, and more formal tableware—on credit. • It is also estimated that your accruals, including taxes and wages…Suppose you are the only owner of a chain of coffee shops near universities. Your current cafés are doing well, but you are interested in starting a fine-dining restaurant. You decide to use the cash generated from your existing business to enter into a new business. Your accountant provides you with the following data on your current financial performance: Financial update as of June 15 • Your existing business generates $111,000 in EBIT. • The corporate tax rate applicable to your business is 25%. • The depreciation expense reported in the financial statements is $21,143. • You don’t need to spend any money for new equipment in your existing cafés; however, you do need $16,650 of additional cash. • You also need to purchase $8,880 in additional supplies—such as tableclothes and napkins, and more formal tableware—on credit. • It is also estimated that your accruals, including taxes and wages payable, will increase by $5,550. Based on your evaluation you have…1. Owner Juana invested P100,000 to start her laundry business. During the first year of operations (2018), the company had a net income of P15,000. Juana invested additional P100,000 to grow the business. In 2019, the business earned P50,000. As of December 31, 2020, Juana’s capital balance is P200,000. How much is Juana’s withdrawal?
- How do I do a general journal entry on this scenario: Seeing that the business is getting some traction, but could benefit for more capital, Scoot Blout invests another $30,000 of his personal money into the business.Answer the following problems and explain it step by step: 1. A man who is 30 years old at the start of the year, is considering getting an MFM degree. He currently earns $40,000 per year and expects to continue earning that amount for the rest of his working life (until age 65). He will give up his income for two years and will pay $20,000 per year in tuition, if he attends business school. In exchange, he expects a raise in his salary after completing his MFM. Assume that the post-graduation salary grows at a 5% annual rate and that the discount rate is 8%. What is the minimum expected starting salary after graduation for him that makes attending business school a positive-NPV investment? (Assuming that all cash flows happen at the end of each year.) 2. Bob and Rose are both 62 years old and plan to retire in 3 years. They will receive $5,000 per month after taxes from pension plans and $1,000 per month after taxes from Social Security after retirement. Regrettably, their living…X had started business with $2,00,000 in the beginning of the year. During the year, he borrowed $1,00,000 from Y. He further introduced $2,00,000 in the business. He also gave $50,000 as loan to his son. Goods given away as charity by him were $20,000. Profits earned by him were $2,50,000. He also withdraw $30,000 from the business. His capital at the end of the year would be__________.