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PPF sign and visa interview questions

$5$

Question $1$

$10$ pts

Given the following information for Mookie's Cookies Co$.,$ calculate the depreciation expense:

sales $=$$$67,000$

costs $=$$$49,200$

addition to retained earnings $=$$$3,500$

dividends paid $=$$$2,170$

interest expense $=$$$1980$

tax rate $=40$ percent

To calculate the depreciation expense for Mookie's Cookies Co$.,$ we begin by determining the net income, which is the sum of the addition to retained earnings $($$$3,500)$ and dividends paid $($$$2,170),$ resulting in $$5,670.$ Given a tax rate of $40\%,$ the taxable income is calculated by dividing the net income by the complement of the tax rate $(1-0\mathrm{.}40),$ yielding $$9,450.$ To find the Earnings Before Interest and Taxes $($EBIT$),$ we add the interest expense of $$1,980$ to the taxable income, resulting in $$11,430.$ Next, we calculate the gross profit by subtracting the costs $($$$49,200)$ from the sales $($ $$67,000),$ which equals $$17,800.$ Finally, the depreciation expense is found by subtracting the EBIT from the gross profit, giving us a depreciation expense of $$6,370.$ This method provides a clear and straightforward calculation of the depreciation expense.

Question $2$

$10$ pts

Most publicly listed companies use the accrual principle of accounting. What is it and why do most companies use it$?$

The accrual principle of accounting is a method that records financial transactions when they occur, irrespective of when cash is actually received or paid. This approach contrasts with the cash basis of accounting, where transactions are only recorded when cash changes hands. The accrual principle hinges on two key concepts: the revenue recognition principle and the expense recognition $($or matching$)$ principle.

According to the revenue recognition principle, revenue is recognized when Can you see the first question is right ir wrong $?$