Master Business with Fun Quizzes & Brain Teasers!
January February March Sales $352,000 $379,000 $443,520 Purchases on Trade Credit $218,000 $240,000 $260,000 Cash Expenses $88,000 $91,000 $94,000 Taxes, interest, and dividends $18,000 $20,000 $41,000 Capital Expenditures $50,000 0 $25,000 All sales are credit sales with 40% collected in the month of sale, 50% collected the following month, and the remainder collected in the second month after the sale. Credit purchases are paid in 30 days and all other items require immediate payment. Compute the net cash inflow for March.
On January 1, year 1, Clem Corp. purchased equipment for $160,000. The equipment has a residual value of $10,000, and has a life of 100,000 hours. Clem uses the activity-based method of depreciation. In year 1, Clem used the machine 2,000 hours, and in year 2, Clem used the machine 3,000 hours. What is the depreciation expense for year 2?