4.RST Co. sold for $6,000 inventory that had cost $4,000. Freight terms for the sale were FOB destination and payment terms were 1/10, n/30. RST records sales transactions at the net amount. RST paid freight costs of $200 in cash. The receivable was collected within the discount period. Based on this information alone, the amount of gross margin would be a.$1,940. b.$1,740. c.$1,800. d.$2,000.

The balance sheet contains the following major sections: current assets long-term investments property, plant, and equipment intangible assets other assets current liabilities long-term liabilities contributed capital retained earnings accumulated other comprehensive income required: the following is a list of accounts. using the letters a through j, indicate in which section of the balance sheet each of the accounts would be classified. if an account does not belong under one of the sections listed, select "not under any of the choices" from the classification drop down box. for all accounts, indicate if the account is a contra account or an account that would normally be deducted on the balance sheet by selecting "yes" from the second drop down box, otherwise select "no". account classification contra or deducted (yes/no) 1. cash 2. bonds payable (due in 8 years) 3. machinery 4. deficit 5. unexpired insurance 6. franchise (net) 7. fund to retire preferred stock 8. current portion of mortgage payable 9. accumulated depreciation 10. copyrights 11. investment in held-to-maturity bonds 12. allowance for doubtful accounts 13. notes receivable (due in 3 years) 14. property taxes payable 15. deferred taxes payable 16. additional paid-in capital on preferred stock 17. premium on bonds payable (due in 8 years) 18. work in process 19. common stock, $1 par 20. land 21. treasury stock (at cost) 22. unrealized increase in value of available-for-sale securities

Shrieves casting company is considering adding a new line to its product mix, and the capital budgeting analysis is being conducted by sidney johnson, a recently graduated mba. the production line would be set up in unused space in the main plant. the machinery’s invoice price would be approximately $200,000, another $10,000 in shipping charges would be required, and it would cost an additional $30,000 to install the equipment. the machinery has an economic life of 4 years, and shrieves has obtained a special tax ruling that places the equipment in the macrs 3-year class. the machinery is expected to have a salvage value of $25,000 after 4 years of use. the new line would generate incremental sales of 1,250 units per year for 4 years at an incremental cost of $100 per unit in the first year, excluding depreciation. each unit can be sold for $200 in the first year. the sales price and cost are both expected to increase by 3% per year due to inflation. further, to handle the new line, the firm’s net working capital would have to increase by an amount equal to 12% of sales revenues. the firm’s tax rate is 40%, and its overall weighted average cost of capital, which is the risk-adjusted cost of capital for an average project (r), is 10%. define “incremental cash flow.” (1) should you subtract interest expense or dividends when calculating project cash flow?

Assume the perpetual inventory method is used. 1) the company purchased $12,500 of merchandise on account under terms 2/10, n/30. 2) the company returned $1,200 of merchandise to the supplier before payment was made. 3) the liability was paid within the discount period. 4) all of the merchandise purchased was sold for $18,800 cash. what effect will the return of merchandise to the supplier have on the accounting equation?