After working for 25 years as personal fitness trainers while raising their kids, three sisters cashed in a total of $120 comma 000 in bonds and decided to open a small, neighborhood fitness center. they spent the $120 comma 000 on exercise equipment, advertising, computer equipment, and other furnishings for the business. for the next 3 years, they took in $145 comma 000 in revenue each year, paid themselves $33 comma 000 annually each, and rented a space in a strip mall for $22 comma 000 per year. before the investment, their $120 comma 000 in bonds were earning interest at a rate of 6 percent. are they now earning economic profits explain? your answer. a. they are earning profits of $115 comma 800, which takes into account the $7 comma 200 opportunity cost of their capital. b. they are earning profits of $16 comma 800, which takes into account the $7 comma 200 opportunity cost of their capital and the $99 comma 000 combined opportunity cost of their own labor. c. they are earning profits of $123 comma 000, which takes into account the opportunity cost of their capital. d. they are earning profits of $3 comma 000, which takes into account the $120 comma 000 opportunity cost of their capital.

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

Miko willingly admits that she is not an accountant by training. she is concerned that her balance sheet might not be correct. she has provided you with the following additional information. 1. the boat actually belongs to miko, not to skysong, inc.. however, because she thinks she might take customers out on the boat occasionally, she decided to list it as an asset of the company. to be consistent, she also listed as a liability of the corporation her personal loan that she took out at the bank to buy the boat. 2. the inventory was originally purchased for $27,500, but due to a surge in demand miko now thinks she could sell it for $39,600. she thought it would be best to record it at $39,600. 3. included in the accounts receivable balance is $11,000 that miko loaned to her brother 5 years ago. miko included this in the receivables of skysong, inc. so she wouldn’t forget that her brother owes her money. (b) provide a corrected balance sheet for skysong, inc.. (hint: to get the balance sheet to balance, adjust stockholders’ equity.) (list assets in order of liquidity.)

Why do police officers get paid less than professional baseball players?