Answer: The answer is given below
Explanation:
The IS-LM model, simply is an acronym which represents "investment-savings" and the "liquidity preference of money supply". The model indicates the interaction between market for economic goods and the loanable funds market which is also called the money market.
The variables are explained below:
a. Employment: A rise in the spending expenditure will result into an increase in the current or future taxes which will have an effect on the workers by making them poorer and therefore making them offer their services to the labor market. This will lead to a rise in labor supply.
b. The real wage: Due to the increase in labor supply, the real wage will reduce because the supply of labor will be more than the demand.
c. Average labor productivity: The marginal productivity of labor or production function is not influenced by fiscal policy changes.
d. Investment: There will be a leftward upward shift of the LM curve. Due to increase in price of goods and services, and the fall in real money supply, the interest rate will rise therefore making investment to reduce.
e. The price level: Demand for output is more than the full employment level of output. This will bring about increase in price.
Important provisions of the Sarbanes-Oxley Act Multiple Choice encourage the destruction of financial documents. approve corporate loans to directors of the company. encourage outside CPA firms to deliver several services to their clients, including auditing services and consulting services. require the CEO and CFO of corporations to certify the accuracy of financial reports.
Answer: require the CEO and CFO of corporations to certify the accuracy of financial reports.
Explanation:
The Sarbanes-Oxley Act of 2002 was passed by the US Congress in the wake of the devastating crisis that engulfed the financial world as a result of the dodgy accounting practices of Enron, WorldCom and Tyco amongst others to protect the Public from acts by companies that would seek to deceive and mislead the public in terms of Accounting and Corporate disclosures.
One of the provisions was that Top Executives such as the CEO and the CFOs of companies personally certify the accuracy of the Financial reports. By doing this they can take personal responsibility and if they make a false certification willingly, they could be prosecuted and jailed.
LeBron James (LBJ) Corporation agrees on January 1, 2020, to lease equipment from Wildhorse, Inc. for 3 years. The lease calls for annual lease payments of $21,000 at the beginning of each year. The lease does not transfer ownership, nor does it contain a bargain purchase option, and is not a specialized asset. In addition, the useful life of the equipment is 10 years, and the present value of the lease payments is less than 90% of the fair value of the equipment. This lease is properly classified as an operating lease. The credit to Lease Liability on December 31, 2020 is ________.
Answer:
interest expense 4,881.08 debit
lease liability 4,881.08 credit
Explanation:
We solve for the present value of the lease payment and with that we solve forthe interest accrued during the period which will be interest expense debit and lease liability credit.
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
C 21,300
time 3
rate 0.06
[tex]21300 \times \frac{1-(1+0.06)^{-3} }{0.06} = PV\\[/tex]
PV $60,351.2638
lease: +60,351.26
less: 21,000.00 payment
81,351.26 before interest
interest over the year 81,351.26 x 0.06 = 4,881.08
Missing Information: 6% implicit rate
The last step in the marketing process often includes: collecting the cash from sales to consumers. developing a written report to summarize the results of the period's marketing activities. deciding the best way to distribute the product. building relationships with customers.
Answer: developing a written report to summarize the results of the period's marketing activities.
Explanation:
The last step in the marketing process often is developing a written report to summarize the results of the period's marketing activities.
Developing a written report to summarise the results of the marketing activities is necessary in order to evaluate the performance of the marketing activity and also learn from past mistakes which have previously affected the company.
These are vital in order to capture a good market share in the future and also achieve organizational goals.
Oxygen combines with nitrogen in the air to form NOx at about
Answer:
2500° F
Explanation:
Oxygen combines with nitrogen in the air to form NOx at about 2500 degrees Fahrenheit.
Consider a lake found in the town of Center Barnstead, and then answer the questions that follow.
The town has a hiking lodge whose visitors use the lake for recreation. The town also has a fish cannery that dumps industrial waste into the lake. This pollutes the lake and makes it a less desirable vacation destination. That is, the fish cannery's waste decreases the hiking lodge's economic profit.
Suppose that the chemical plant could use a different production method that involves recycling water. This would reduce the pollution in the lake to levels safe for recreation, and the hiking lodge would no longer be affected. If the chemical plant uses the recycling method, then the chemical plant's economic profit is $1,400 per week, and the hiking lodge's economic profit is $2,700 per week. If the chemical plant does not use the recycling
method, then the chemical plant's economic profit is $2,200 per week, and the hiking lodge's economic profit is $1,500 per week. These figures are summarized in the following table.
Complete the following table by computing the total profit (the chemical plant's economic profit and the hiking lodge's economic profit combined) with and without recycling.
Action Chemical Plant Hiking Lodge Total
No recycling $2200 $1500 ______
Recycling $1400 $2700 ______
Total economic profit is highest when the recycling production method is:________
Answer:
a. Total profit without recycling is $3,700, while Total profit with recycling is $41,000.
b. Total economic profit is highest when the recycling production method is: implemented or utilized.
Explanation:
a. Complete the following table by computing the total profit (the chemical plant's economic profit and the hiking lodge's economic profit combined) with and without recycling.
These can be computed by adding the profit under the two scenario as follows:
Total profit without recycling = Chemical plant's economic profit without recycling + Hiking lodge's economic profit without recycling = $2,200 + $1,500 = $3,700
Total profit with recycling = Chemical plant's economic profit with recycling + Hiking lodge's economic profit with recycling = $1,400 + $2,700 = $4,100
The table can therefore be reproduced as follows:
Action Chemical Plant Hiking Lodge Total
No recycling $2,200 $1,500 $3,700
Recycling $1,400 $2,700 $4,100
b. Total economic profit is highest when the recycling production method is:________
From part a. above, total economic profit is highest when the recycling production method is: implemented or utilized.
The reason is that total profit with recycling of $4,100 is greater than total profit without recycling of $3,700.
Based on the table, the Center Barnstead Town receives more economic benefit when the Fish Cannery recycles the industrial waste.
Though, Cannery's revenue drops by $800 ($2,200 - $1,400), the Hiking Lodge's revenue increases by $1,200 ($2,700 - $1,500). These results cause the net total revenue for the town to increase by $400 ($1,200 - $800) plus the cleaner ecosystem.
Data and Calculations:
Action Chemical Plant Hiking Lodge Total
No recycling $2,200 $1,500 $3,700 ($2,200 + $1,500)
Recycling $1,400 $2,700 $4,100 ($1,400 + $2,700)
Total increase in Revenue with recycling = $400 ($4,100 - $3,700)
Thus, it is in the best economic interest of the town to ensure that the Cannery recycles the waste.
Learn more: https://brainly.com/question/11641030
Roy Company manufactures a product in Departments A and B. Materials are added at the beginning of the process in Department B. Roy uses the weighted-average method in its process costing system. Conversion costs for Department B were 50% complete with respect to the 6,000 units in the beginning work in process and 75% complete with respect to the 8,000 units in the ending work in process. A total of 12,000 units were completed and transferred out of Department B during February. An analysis of the costs in Department B for February follows: The total cost per equivalent unit during February was closest to:_________
a. $2.75
b. $2.78
c. $2.82
d. $2.85
Answer:
Number of equivalent units= 18,000
Explanation:
Giving the following information:
Conversion costs for Department B were 50% complete concerning the 6,000 units in the beginning work in process and 75% complete for the 8,000 units in the ending work in process. A total of 12,000 units were completed and transferred out of Department B during February.
With the information provided, we can calculate the number of equivalent units of the period.
Beginning work in process = 6,000*0.5= 3,000
Units started and completed = 12,000 - 3,000= 9,000
Ending work in process completed= 8,000*0.75= 6,000
Number of equivalent units= 18,000
Use the following Window Breeze Company income statement to answer the question. Window Breeze Company is a small manufacturer of window air conditioners and reported the following: Window Breeze Company Full Costing Income Statement For the Year Ending December 31, 2011
Sales ($150 per unit) $120,000
Less cost of goods sold 35,000
Gross margin 85,000
Less selling and administrative expenses:
Selling expense $15,000
Administrative expense 15,000 30,000
Net income $55,000
Annual FMOH was $25,000 and 1,000 units were produced. All administrative costs were fixed. Included in the $15,000 selling expense was $10,000 of fixed selling.
Missing information:
How much is the value of full costing ending inventory?
Answer:
$8,750
Explanation:
1,000 units were produced and 800 were sold, so ending inventory = 200 units
total production cost per unit (under full costing) = $35,000 / 800 = $43.75
ending inventory = $43.75 x 200 = $8,750
Full costing basically refers to absorption costing, which calculates COGS using both variable and fixed costs (total production costs).
Use the information below for Harding Company to answer the question that follow. Harding Company Accounts payable $ 40,000 Accounts receivable 65,000 Accrued liabilities 7,000 Cash 30,000 Intangible assets 40,000 Inventory 72,000 Long-term investments 110,000 Long-term liabilities 75,000 Marketable securities 36,000 Notes payable (short-term) 30,000 Property, plant, and equipment 625,000 Prepaid expenses 2,000 Based on the data for Harding Company, what is the amount of quick assets
Answer:
$131,000
Explanation:
The computation of the amount of quick assets is shown below:
Quick asset = Account Receivable + Cash + marketable securities
= $65,000 + $30,000 + $36,000
= $131,000
We simply added the account receivable, cash and the marketable securities so that the quick assets could come plus it contains more liquidity that converted into cash in a very short period of time and the rest of the items are ignored as there are not relevant
Brooke Hubert works for MRK all year and earns a monthly salary of $ 11 comma 900. There is no overtime pay. Brooke's income tax withholding rate is 10 % of gross pay. In addition to payroll taxes, Brooke elects to contribute 5 % monthly to United Way. MRK also deducts $ 125 monthly for co-payment of the health insurance premium. As of September 30, Brooke had $ 107 comma 100 of cumulative earnings. LOADING...(Click the icon to view payroll tax rate information.) Requirements 1. Compute Brooke's net pay for October. 2. Journalize the accrual of salaries expense and the payments related to the employment of Brooke Hubert.
Answer:
1. Compute Brooke's net pay for October
Brooke's gross monthly salary = $11,900
- federal income taxes withholdings = ($1,190)
- contribution to United Way = ($595)
- health insurance = ($125)
- social security = 6.2% x $11,900 = ($737.80)
- medicare = 1.45% x $11,900 = ($172.55)
net pay = $9,079.65
2. Journalize the accrual of salaries expense and the payments related to the employment of Brooke Hubert.
We must include here FUTA taxes paid by the employer. In this case, since we are not given the state unemployment (SUTA) tax rate, we can only calculate the federal unemployment tax 6% x $11,900 = $714. Both the employee and employer pays FICA taxes in an equal amount. The amount that is withheld from the employee's paycheck is identified as FICA tax withholding.
October 31, 202x
Dr Wages expense 11,900
Dr FICA taxes expense 910.35
Dr FUTA taxes expense 714
Cr Federal income tax withholding payable 1,190
Cr FICA tax (social security) withholding payable 737.80
Cr FICA tax (social security) payable 737.80
Cr FICA tax (medicare) withholding payable 172.55
Cr FICA tax (medicare) payable 172.55
Cr FUTA tax payable 714
Cr Health insurance payable 125
Cr United Way payable 595
Cr Wages payable 9,079.65
The following items are taken from the financial statements of the Sage Service for the year ending December 31, 2020: Accounts payable $ 17800 Accounts receivable 11200 Accumulated depreciation – equipment 28000 Advertising expense 20800 Cash 15300 Owner’s capital (1/1/20) 42900 Owner’s drawings 13700 Depreciation expense 12300 Insurance expense 3100 Note payable, due 6/30/21 69700 Prepaid insurance (12-month policy) 6200 Rent expense 17000 Salaries and wages expense 32000 Service revenue 132800 Supplies 4000 Supplies expense 5800 Equipment 209300 What are total long-term liabilities at December 31, 2020?
Answer:
$0
Explanation:
The computation of the long term liabilities is shown below:
As we know that the long term liabilities are the liabilities which are due for the next months
In the given question, there is a note payable which is due on June 30, 2021 and we have to find the long term liabilities for Dec 31,2020 so it is made only 6 months but we required 12 months So the note payable is treated as a current liabilities
So, the amount should be $0 in this case
During the year, RIT Corp. had sales of $565,600. Costs of goods sold, and depreciation expenses were $476,000, and $42,800, respectively. In addition, the company had an interest expense of $112,000 and a tax rate of 22 percent. What is the operating cash flow for the year
Answer:
Cash flows from Operating activities is $30800
Explanation:
The first thing that we will calculate is the Net Profit for the year thereafter we will calculate the operating cash flow for the year.
Step 1: Calculate is the Net Profit for the Year
Sales $5,65,600
Less: Cost of Goods Sold ($4,76,000)
Gross margin $89,600
Less: Admin and Selling expenses ($58800)
Less: Depreciation ($42,800)
Less: Interest expense ($112,000)
Net income before tax (124000)
Less: tax -
Net income after tax ($1,24,000)
Step 2: Now we will calculate the Cash flow from Operating activities
Net income after tax ($1,24,000)
Add: Depreciation $42,800
Add: Interest $1,12,000
Cash flow from Operating activities $30800
Suppose that you are the manager and sole owner of a highly leveraged company. All the debt will mature in one year. If at that time the value of the company is greater than the face value of the debt, you will pay off the debt. If the value of the company is less than the face value of the debt, you will declare bankruptcy and the debt holders will own the company.
a) Express your position as an option on the value of the company.
b) Express the position of the debt holders in terms of options on the value of the company.
c) What can you do to increase the value of your position?
Answer:
From my position as an option on the value of the company, the stance or view of the owner is a call option on value of company strike face of debt
Secondly, debt holders have systematically sold a put option value of company strike at face of debt.
Now, to be able to increase or raise the value call option it includes he following, In making sure to raise the value of the company, To boost the unpredictability of the company.
Explanation:
Solution
(a) The position of the owner is a call option on value of company strike at face of debt
(b)The debt holders have efficiently sold a put option on value of company strike at face of debt.
(c) To be able to increase the value option call the following are listed below:
Endeavor or make sure to raise the value of the companyBoost the volatility of the company.A company had net sales of $21,500 and ending accounts receivable of $2,700 for the current period. Its days' sales uncollected equals: (Use 365 days a year.) Multiple Choice 8.0 days. 58.9 days. 45.8 days. 7.4 days. 45.2 days.
Answer:
45.8 days
Explanation:
The computation of the days sales uncollected is shown below:
But before that first we need to find out the inventory turnover ratio which is
Inventory turnover ratio = Sales ÷ Accounts receivable
= $21,500 ÷ $2,700
= 7.96 times
Now Days sales uncollected is
= 365 ÷ Inventory turnover ratio
= 365 ÷ 7.96
= 45.8 days
We simply applied the above formulas
From 2010 to 2011, nation A's real GDP increased from $100 billion to $106 billion and its population grew from 50 million to 51 million. As a result, real GDP per capita _____ because real GDP rose _____ than the population.
Answer:
As a result, real GDP per capita WILL INCREASE because real GDP rose MORE than the population.
Explanation:
increase in real GDP = $106 - $101 = $5 billion, or 4.95%
population increase = 51 - 50 = 1 million people, or 2%
real GDP per capita 2010 = $101,000 / 50 = $2,020
real GDP per capita 2011 = $106,000 / 51 = $2,078
since the real GDP increased by almost 5%, while the population increased only by 2%, the real GDP per capita will increase by 2.9%
Monson sells 29 units for $50 each on December 15. Monson uses a perpetual inventory system. Determine the costs assigned to ending inventory when costs are assigned based on the weighted average method. (Round your per unit costs to 2 decimal places.)
The complete question:
Trey Monson starts a merchandising business on December 1 and enters into the following three inventory purchases. Also, on December 15, Monson sells 29 units for $50 each.
Purchases on December 7 20 units at $20.00 each
Purchases on December 14 34 units at $30.00 each
Purchases on December 21 30 units at $36.00 each
Monson uses a perpetual inventory system. Determine the costs assigned to ending inventory when costs are assigned based on the weighted average method. (Round your per-unit costs to 2 decimal places.)
Answer:
Trey MonsonDetermination of the cost of Ending Inventory based on the Weighted Average Method:Date Quantity Unit Cost Total Cost
Dec. 7 Purchase 20 $20 $400
Dec. 14 Purchase 34 30 1,020
Total 54 26.30 $1,420 .20
Dec. 15 Sale -29 26.30 -762.70
Dec 15 Balance 25 26.30 $657.50
Dec. 21 Purchase 30 36 1,080
Dec. 21 Available 55 31.59 $1,737.50
Dec. 31 Ending Inventory 55 $31.59 $1,737.50
Explanation:
To use the weighted average method, we divide the cost of goods available for sale by the number of units available for sale, which yields the weighted-average cost per unit. The cost of goods available for sale is the sum of beginning inventory and net purchases.
A company pays its employees $4,250 each Friday, which amounts to $850 per day for the five-day workweek that begins on Monday. If the monthly accounting period ends on Thursday and the employees worked through Thursday, the amount of salaries earned but unpaid at the end of the accounting period is:
Answer:
$3,400
Explanation:
Out of five day workweek, accounting period ends on Thursday which indicates that employees work only for 4 days. Therefore, salaries are earned only for 4 working days and unpaid at the end of the accounting period
Salaries earned but unpaid= 4 working days * $850 per day = $3,400
Hence, salaries earned but unpaid at the end of the account period is $3,400
Kingbird Company leased equipment from Costner Company, beginning on December 31, 2019. The lease term is 4 years and requires equal rental payments of $32,230 at the beginning of each year of the lease, starting on the commencement date (December 31, 2019). The equipment has a fair value at the commencement date of the lease of $120,000, an estimated useful life of 4 years, and no estimated residual value. The appropriate interest rate is 5%. Prepare Kingbird's 2019 and 2020 journal entries, assuming Kingbird depreciates similar equipment it owns on a straight-line basis.
Date Account Titles and Explanation Debit Credit
Answer:
Kingbird's 2019 and 2020 journal entries, assuming Kingbird depreciates similar equipment it owns on a straight-line basis is prepared in the table below.
_____________________________
Date: 12/31/2019
Account: Right of use asset. Debit: $120,000
Account: Lease liability. Credit: $120,000
(To record lease liability)
_____________________________
Date: 12/31/2019
Account: Lease liability. Debit: $32,230
Account: Cash. Credit: $32,320
(To record lease payment)
_____________________________
Date: 12/31/2020
Account: Interest Expense ($120,000-$32,230)*5%. Debit: $4,389
Account: Lease Liability (Plug in) ($32,320 - $4,389). Debit: $27,841
Account: Cash. Credit: $32,320
______________________________
Date: 12/31/2020
Account: Amortization Expense. Debit: $30,000
Account: Right of use asset. Credit: $30,000
(To record amortization) $120,000/4 years
_____________________________
Skolits Corp. issued 20-year bonds 2 years ago at a coupon rate of 8.9 percent. The bonds make semiannual payments. If these bonds currently sell for 110 percent of par value, what is the YTM
Answer:
The YTM is 7.85%
Explanation:
Since 20 year bonds were issued 2 years ago,
Time to Maturity = 18 years
Coupon Rate = 8.9%
Lets assume that the par value of the bond is $100
The bonds make semi-annual payments,
Therefore, number of periods = 18 × 2 = 36
Semi-annual Coupon =( 8.9% × 100 ) / 2 = $4.45
Current Value of Bond = 110% of par value = 1.1 × 100 = $110
YTM is the discount rate which makes the present value of all the future cash flows equal to the current value of the bond, that is $110 , which means
110 = [tex]4.45/(1+r)^1[/tex] + [tex]4.45/(1+r)^2[/tex] + ... + [tex]4.45/(1+r)^{35[/tex] + [tex]104.45/(1+ r)^{36[/tex]
where, r is YTM/2
r = 3.927%
Therefore, YTM = 3.927 × 2 = 7.85%
A queuing theory analysis for the Department of Motor Vehicles determines that customers typically wait for 8 minutes and that the agency should strive never to exceed more than 5 customers in a single line. What is the maximum amount of time that customers should be expected to wait?
Answer: 40 minutes
Explanation:
A queueing theory is simply the study of queues or waiting lines. From the question, we are informed that a queuing theory analysis for the Department of Motor Vehicles determines that customers typically wait for 8 minutes and that the agency should strive never to exceed more than 5 customers in a single line.
The maximum amount of time that customers should be expected to wait will be the wait time for a customers multiplied by the number of customers on a queue. This will be:
= 5 × 8 minutes
= 40 minutes
In 2016, Akin Company sold 3,000 units at $750.00 each. Variable expenses were $375.00 per unit, and fixed expenses were $130,000. The same selling price is expected for 2017. Akin is tentatively planning to invest in equipment that would increase fixed costs by 17.00%, while decreasing variable costs per unit by 20.00%. What is the company's break-even point in units for 2017?
Answer:
338
Explanation:
Break even point = F/ P - V
F = fixed cost
P = price
V = variable cost
Change in fixed cost = $130,000 × 1.17 = $152,100
Change in variable cost = $375.00 × 0.80 = $300
$152,100 / $750.00 - $300 = $152,100 / $450 = 338
I hope my answer helps you
Identify whether the following activities Ere examples Of business-level or corporate level strategy.
a. A company's managers ask, "Should we increase the size of our Bluetooth wireless speaker and sell it at a higher cost?"
b. Never previously known as a computer hardware company, Microsoft decides to enter the tablet manufacturing business, producing the Microsoft Surface.
c. Managers for IBM's SPSS statistics software meet to determine how they Will market the product in the upcoming year. Their decision is to show potential clients how effective SPSS is at analyzing extremely large data sets, and how
the "Direct Marketing" part Of the program helps identify which customers will respond to advertisements.
d. The manufacturer of Chobani Yogurt decided to open a flagship store in Soho, where customers can order special yogurt creations, such as fig and walnut or cucumber and olive oil. Though it was in the business of manufacturing
yogurt for 7 years, the company never tried to run a restaurant before.
Answer: A. Business Level.
B. Corporate Level.
C. Business Level.
D. Corporate Level.
Explanation:
Business level strategies are used by a company to engage in transactions that will enable it to sell it's products and bring in profit to the company. It therefore focuses on the customers the business has.
Corporate Level strategies on the other hand are at organizing level of the Organization. In other words they deal with decisions meant to progress the company to make it bigger or more profitable. For example by selling or buying companies/ business units.
A. This is a business level activity as it focuses on the sales of their Bluetooth products.
B. This is a Corporate Level Strategy as it deals with Microsoft as an Organization entering a new market i.e diversifying for growth.
C. This is a Business level strategy as it deals with the product that the company wants to improve sales of which is SPSS.
D. This is a Corporate Level Strategy because as the text shows, the company has never tried to run a restaurant before. They are therefore diversifying and entering into a new market.
The internal financial statements of Vera Incorporated show that their beaded purses incurred an operating loss in the most recent year. There were 27 comma 000 purses sold in that year. Selected financial information about the purse line follows. Total sales revenue $ 191 comma 000 Variable costs $ 92 comma 000 Contribution margin $ 99 comma 000 Fixed costs $ 101 comma 000 Net operating loss $( 2 comma 000 ) If the line of purses were to be discontinued, the company would avoid $ 21 comma 000 in fixed costs per year. If Vera Incorporated were to discontinue the line of purses, the change in annual operating income would be
Answer:
Vera Incorporated
Change in annual operating income from discontinued business:
Annual Operating Income would reduce by $78,000.
Explanation:
a) Calculation of the Net Income Lost:
Loss of Contribution ($99,000)
Avoidable fixed cost $21,000
Reduction of Income ($78,000)
b) The line of purses contributes $80,000 towards the company's fixed cost. Therefore, discontinuing this line of business would lead to the loss of this steam of income. The amount of reduced operating income will be $78,000 ($80,000 - 2,000).
Suppose a firm’s sales for the year = $1200 and its average receivables balance is $200. What is the firm’s Accounts Receivable Turnover Ratio, expressed in days (not times per year)?
Answer:
61 days
Explanation:
Accounts receivable turn over ratio is an efficiency ratio that is used to calculate how efficiently a company is receiving its sales on account payments . This measures the number of times in a period that a company collects its average accounts receivable.
When expressed in days , it reveals the number of days it takes a sales on account customer to make payment
Workings
Annual sales = 1200
Average receivable balance = 200
Receivable turnover ratio = Annual sales /average receivable balance
1200/ 200 = 6
Account receivable turnover ratio in days = 365/receivable turnover ration
365/6 = 60.8 days = approximately 61 days
This shows that it takes a customer approximately 61 days to pay their purchase on account which
On September 1, Sky Mountain Co. borrowed $68,000 on a 6%, 9-month note payable to Coast National Bank. Given no previous adjusting entries have been recorded, Sky Mountain's adjusting entry four months later at December 31 would include a:
Answer and Explanation:
The journal entry is shown below:
Interest expense ($68,000 × 9% × 4 months ÷ 12 months) $2,040
To Interest payable $2,040
(Being the interest expense is recorded)
For recording this we debited the interest expense as it increased the expenses and credited the interest payable as it also increased the liabilities so that the proper journal entries could be recorded
g A particular brand of toothpaste costs 4 British pounds in London. The nominal exchange rate is .80 and the real exchange rate is about 1.16. These numbers imply that the U.S. price of the same toothpaste is about a. $5.79 b. $4.29 c. $3.70 d. $2.76
Answer:
The answer is option (d)$2.76
Explanation:
Solution
Given that:
The cost of a particular brand of toothpaste = 4 pounds
The exchange rate = .80
Real exchange rate = 1.16
Now
Real exchange rate is given as:
R = real exchange rate
e = nominal exchange rate
PF = foreign price
P = domestic price
Suppose we say that U.S. is a domestic country and British is a foreign country we have the following formula below:
R = e(PF/P)
R = 1.16
e = 0.80
PF = 4
Thus
R = e(PF/P)
1.16 = 0.80(4/P)
P = 3.2/1.16
= 2.7586207
= $2.76
Therefore, The U.S rice of the same toothpaste is about $2.76
Using both the supply and demand for bonds and liquidity preference framework, show how interest rate are affected when the riskiness of bonds rises. Are the results the same in the two frame works
Answer:
Yes, the results are the same in both frameworks. Please see below for explanation.
Explanation:
With regards to the bond supply and demand framework, people will look to buy more bonds since they are more wealthy now. Hence, the supply of bonds will increase. The supply curve and the demand curve will both move to the right, with the former shifting more than the latter. The equilibrium interest rate will increase.
With regards to the liquidity preference framework, once the economy experiences a positive shift, there will also be an increase in the demand for money. People will make an increased number of transactions as well and hence, the demand curve will move towards the right. The equilibrium interest rate will rise too.
Big Canyon Enterprises has bonds on the market making annual payments, with 17 years to maturity, a par value of $1,000, and a price of $969. At this price, the bonds yield 8.1 percent. What must the coupon rate be on the bonds?
Answer:
7.8%
Explanation:
For computing the coupon rate first we have to determine the PMT by using the PMT formula which is shown in the attachment below:
Given that,
Present value = $969
Future value or Face value = $1,000
RATE =8.1%
NPER = 17 years
The formula is shown below:
= PMT(RATE;NPER;-PV;FV;type)
The present value come in negative
So, after applying the above formula, the PMT is $77.58
Now the coupon rate is
= $77.58 ÷ $1,000
= 7.8%
A bank is earning 6 percent on its $150 million in earning assets and is paying 4.75 percent on its liabilities. The bank's interest rate spread is __________. Multiple Choice 1.25 percent 1.26 percent 4.75 percent 6.00 percent 10.75 percent
Answer:
1.25 percent
Explanation:
Relevant data provided
Interest earned = 6%
Interest paid on liabilities = 4.75%
The computation of interest rate spread is shown below:-
Interest rate spread = Interest earned - Interest paid on liabilities
= 6% - 4.75%
= 1.25%
Therefore for computing the interest rate spread we simply applied the above formula and ignore all other amount as it is not relevant.
Pettygrove Company had 1,700,000 shares of $10 par value common stock outstanding. The amount of additional paid-in capital is $8,500,000, and Retained Earnings is $2,550,000. The company issues a 2-for-1 stock split. The market price of the stock is $11. What is the balance in the Common Stock account after this issuance
Answer:
$17,000,000
Explanation:
Balance in common stock after the issuance = $1700,000 x $10
Balance in common stock after the issuance = $17,000,000
You can't find difference between balance of common stock, additional paid-in capital, and retained earnings when a company issues a stock split But there would be surely a change in par value and number of outstanding shares. Market value of share will either increase or decrease.
Country Furniture Company manufactures furniture at its​ Akron, Ohio, factory. Some of its costs from the past year​ include: Depreciation on sales office: ​ $9,700 Depreciation on factory equipment 16,700 Factory supervisor salary 50,800 Sales commissions 23,900 Lubricants used in factory equipment 3,300 Insurance costs for factory 21,100 Wages paid to maintenance workers 115,900 Fabric used to upholster furniture 10,300 Freightminusin ​(on raw​ materials) 3,300 Costs of delivery to customers 9,100 Wages paid to assemblyminusline workers 115,700 Lumber used to build product 82,900 Utilities in factory 54,600 Utilities in sales office 26,600 Conversion costs for Country Furniture Company totaled:_______ a. $378,100.b. $486,500.c. $526,500.d. $510,500.
Answer:
just asking. is this even a question or a passage for us to read. im confused someone help me out here
Explanation: