Showing posts with label Berry Co. Show all posts
Showing posts with label Berry Co. Show all posts

Saturday, October 10, 2020

Charco purchased a franchise from Burger Master on January 1, 2021, for $240,000. The franchise agreement allows Charco to sell hamburgers

Charco purchased a franchise from Burger Master on January 1, 2021, for $240,000. The franchise agreement allows Charco to sell hamburgers and other related food items using the Burger Master name for a period of 6 years. Assuming Charco uses the straight-line method, what is the carrying value of the franchise on December 31, 2022?



A) $120,000.

B) $80,000.

C) $240,000.

D) $160,000.


Answer: D


Charco purchased a franchise from Burger Master on January 1, 2021, for $240,000. The franchise agreement allows Charco to sell hamburgers and other related food items using the Burger Master name for a period of six years. Assuming Charco uses the straight-line method, what is the amortization expense for the year ended December 31, 2021?



A) $0.

B) $28,000.

C) $40,000.

D) $240,000.


Answer: C


Berry Co. purchases a patent on January 1, 2021, for $40,000 and the patent has an expected useful life of five years with no residual value. Assuming Berry Co. uses the straight-line method, what is the carrying value of the patent on December 31, 2022?



A) $21,000.

B) $33,000.

C) $24,000.

D) $26,000.


Answer: C

Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years

Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years, but only an expected useful life of five years with no residual value. Assume the company uses the straight-line method to record amortization.
What is the carrying value of the copyright at the end of the second year?



A) $10,000.

B) $40,000.

C) $50,000.

D) $30,000.


Answer: D


Bricktown Exchange purchases a copyright for $50,000. The copyright has a remaining legal life of 25 years, but only an expected useful life of five years with no residual value. Assume the company uses the straight-line method to record amortization.
What is the carrying value of the copyright at the end of the first year?



A) $0.

B) $10,000.

C) $50,000.

D) $40,000.


Answer: D


Berry Co. purchases a patent on January 1, 2021, for $40,000 and the patent has an expected useful life of five years with no residual value. Assuming Berry Co. uses the straight-line method, what is the amortization expense for the year ended December 31, 2022?



A) $0.

B) $8,000.

C) $16,000.

D) $40,000.


Answer: B

Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will the purchase of inventory with cash affect each ratio?

Assuming a current ratio of 1.2 and an acid-test ratio of 0.80, how will the purchase of inventory with cash affect each ratio? A) Increase ...