Answer: priority to payment in states that follow the English rule
Explanation:
From the question, we are told that Elin owes Floyd $10,000 but Floyd assigns the claim to Gary and that Gary does not notify Elin of the assignment.
A week later, Floyd assigns the same claim to Holly. Holly immediately notifies Elin of the assignment. Holly has priority to payment in states that follow the English rule.
Holly has priority claim because Holly has already notified Elin of the task before and therefore has priority to payment in states that follow the English rule.
Option B is correct
Between any two countries trading two products, where each country has a comparative advantage in producing one of these two products, we know that the regulated trade is always better than the free trade.
a. True
b. False
Answer:
False.
Explanation:
In Economics, comparative advantage is referred to as the advantage of a country enjoyed by producing one of the two goods. In this case, the other country also entertains the comparative advantage by producing other products. However, it cannot be said that regulated trade is better than free-trade.
The entrepreneur's integrity is not relevant to bankers when determining the creditworthiness of a business loan.
A. True
B. False
Answer:
A.True
Explanation:
a person who sets up a business or businesses, taking on financial risks in the hope of profit.
In calculating the creditworthiness of an entrepreneur, integrity is true.
Why is an entrepreneur's integrity not important?Financial establishments try to mitigate the hazard of lending to debtors via means of performing a credit score evaluation on people and companies using a brand new credit score account or loan.
They are called the 5 Cs of credit score because they consist of capacity, capital, conditions, character, and collateral.
So, from the above declaration, it's clear that the option B is true.
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Parker & Stone, Inc., is looking at setting up a new manufacturing plant in South Park to produce garden tools. The company bought some land 10 years ago for $5 million in anticipation of using it as a warehouse and distribution site, but the company has since decided to rent these facilities from a competitor instead. If the land were sold today, the company would net $9.6 million. The company wants to build its new manufacturing plant on this land; the plant will cost $15.2 million to build, and the site requires $960,000 worth of grading before it is suitable for construction.
What is the proper cash flow amount to use as the initial investment in fixed assets when evaluating this project?
Cash Flow amount $ _____
Answer:
$25,760,000
Explanation:
The net amount of decrease and increase of cash a business or individual owns.
To find the proper cash flow amount used as the initial investment in fixed assets, use the following:
Calculation of initial investment outflow = cost of land + cost of plant + grading cost
= $9,600,000 + 15,200,000, + $960,000
= $25,760,000
Calculation of initial investment outflow = $25,760,000
Therefore the initial investment outflow is $25,760,000
Brandon is a successful professional. He is a divorced father of a 10 year old. He is confident due to his award-winning work on the college debate team. He is conscious of fashion and is meticulous about his clothes. He subscribes to numerous trade and specialty magazines. He loves to tell others about the new products he buys.
A. EA
B. EM
C. L
D. LM
Answer:
A). EA (Early Adopters)
Explanation:
There are basically five categories of adopters namely (in no particular order):
Early adopters (EA);
Late majority(LM);
Early majority (EM);
Innovators (I);
Laggards (L).
The early adopters can be said to be trend setters. Their opinions are taken by others as they are quite young and have enough social contacts. They tend to adopt to new technologies easily, but not as apt as the innovators. The early adopters tend to show off their choice of fashion and trends and even suggest to others to buy similar products.
All the characteristics of Brandon listed in this case falls in the early adopters perfectly. Therefore we can say that brandon is an early adopter(EA).
Option A is correct.
Below is budgeted production and sales information for Flushing Company for the month of December. Product XXX Product ZZZ Estimated beginning inventory 31,000 units 17,100 units Desired ending inventory 36,400 units 14,300 units Region I, anticipated sales 348,000 units 266,000 units Region II, anticipated sales 189,000 units 140,000 units The unit selling price for product XXX is $6 and for product ZZZ is $15. Budgeted production for product ZZZ during the month is a.604,400 units b.403,200 units c.406,000 units d.420,300 units
Answer:
Production= 403,200 units
Explanation:
Giving the following information:
Product ZZZ
Estimated beginning inventory= 17,100 units
Desired ending inventory 14,300 units
Sales:
Region I= 266,000 units
Region II= 140,000 units
Total= 406,000
To calculate the production required for the period, we need to use the following formula:
Production= sales + desired ending inventory - beginning inventory
Production= 406,000 + 14,300 - 17,100
Production= 403,200 units
If some of the products developed by I'mASoftwareCo. must face market competition that can very quickly produce either an identical product or a close substitute for it, then
a) it may decide against R&D projects of this sort.
b) it will have to figure out innovative ways to prevent adaptation and copying of its products.
c) the other firms will all save on their R&D costs.
d) it must charge more for its products to quickly compensate for the research and development costs.
Answer:
A.It may decide against R & D projects of this sort
Explanation:
Where there is market competition, such can present an avenue for a firm to discover new products/technology. Also, a firm could generate more profit because they are able to produce goods at a cheaper rate or produce products with certain features that suits customers needs. When a firm is innovative, it will have an edge over it's competitors in the mean time hence must have made enough profits before competitors catches up.
However, in a case where competition discourages technology as in the above case i.e a new firm copying the company's idea, the company may decide against R&D projects of this sort because if the research and development effort fails, the company may incur loss which could drive it out of business. Moreover, it means that the R&D on such product has not been successful since an identical product or a close substitute product can quickly be produced by it's competitors hence must be decided against to avoid them making losses.
A change from carrying securities at fair value to the equity method of accounting for an investment in common stock resulting from an increase in the number of shares held by the investor requires:
A. only a footnote disclosure
B. that the cumulative amount of the change be shown as a line item on the income statement, net of tax.
C. retroactive restatement as if the investor always had used the equity method.
D. that the investor begins accruing income earned by the investee under the equity method at the date of acquisition of the new shares.
Answer:
D
Explanation:
the investor has to being with accruing income earned by the investee
The cost of direct materials transferred into the Bottling Department of Mountain Springs Water Company is $538,900. The conversion cost for the period in the Bottling Department is $592,000. The total equivalent units for direct materials and conversion are 31,700 and 7,400, respectively. Determine the direct materials and conversion cost per equivalent unit.
Answer: 17 per unit; 80 per unit
Explanation:
From the question, we are informed that the cost of direct materials transferred into the Bottling Department of Mountain Springs Water Company is $538,900 and that the conversion cost for the period in the Bottling Department is $592,000 while the total equivalent units for direct materials and conversion are 31,700 and 7,400, respectively.
The direct materials cost per equivalent unit will be the cost of direct materials that is transferred into the Bottling Department of Mountain Springs Water Company which is $538,900 divided by the total equivalent units for direct materials which is 31700. This will be:
= $538,900/31700
= 17 per unit
The conversion cost per equivalent unit will be the conversion cost for the period in the Bottling Department which is $592,000 divided by the total equivalent units for conversion which is 7,400. This will be:
= $59200/7400
= 80 per unit
The market value of which of the items would be considered double (or multiple) counting in the calculation of GDP? Indicate the following that they are included in GDP or not included in GDP.
a. a used skateboard you buy for your brother
b. the commission paid to the seller of a previously owned collectors skateboard
c. a new building for tony hawk industries
d. used copy of the tony hawk video game
e. previously owned collectors skateboard
f. ticket for the X games bought from a person on a street corner
g. new skateboard you buy for your niece
h. Wheels used to produce a skateboard that will be sold new
Answer:
Included in GDP :
b. the commission paid to the seller of a previously owned collectors skateboard
c. a new building for tony hawk industries
g. new skateboard you buy for your niece
Not Included in GDP :
a. a used skateboard you buy for your brother
d. used copy of the tony hawk video game
e. previously owned collectors skateboard
f. ticket for the X games bought from a person on a street corne
h. Wheels used to produce a skateboard that will be sold new
Explanation:
Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year
GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export
Net export = exports – imports
When exports exceeds import there is a trade deficit and when import exceeds import, there is a trade surplus.
Items not included in the calculation off GDP includes:
1. services not rendered to oneself
2. Activities not reported to the government
3. illegal activities
4. sale or purchase of used products
5. sale or purchase of intermediate products
the following items aren't included in the calculation of GDP because they are used items and were included in the year they were produced. adding them to GDP would be regarded as double counting
a. a used skateboard you buy for your brother
d. used copy of the tony hawk video game
e. previously owned collectors skateboard
h. Wheels used to produce a skateboard that will be sold new aren't included in the calculation of GDP because it an intermediate product used in the production of skateboards.
ticket for the X games bought from a person on a street corner aren't included in the calculation of GDP because they have already been paid for.
n applying the lower of cost or market rule, the inventory of rehab equipment would be valued at: A) $315. B) $247. C) $150. D) $235.
Answer:
D) $235.
Explanation:
As we know that the inventory should be valued at cost or market value whichever is lower
In the given case
Selling price = $340
Net realizable value is
= Selling price - cost of sell
= $340 - $25
= $315
Replacement cost is $235
Cost = $250
As we can see that the replacement cost is less than the cost so the replacement cost should be valued i.e $235
Lavage Rapide is a Canadian company that owns and operates a large automatic carwash facility near Montreal. The following table provides data concerning the company’s costs:
Fixed Cost Cost per
per Month Car Washed
Cleaning supplies $0.80
Electricity $1,200 $ 0.15
Maintenance $0.20
Wages and salaries $5,000 $0.30
Depreciation $6,000
Rent $8,000
Administrative
expenses $4,000 $0.10
For example, electricity costs are $1,200 per month plus $0.15 per car washed. The company expected to wash 9,000 cars in August and to collect an average of $4.90 per car washed.
The actual operating results for August appear below.
Lavage Rapide
Income Statement
For the Month Ended August 31
Actual cars washed 8,800
Revenue $43,080
Expenses:
Cleaning supplies 7,560
Electricity 2,670
Maintenance 2,260
Wages and salaries 8,500
Depreciation 6,000
Rent 8,000
Administrative expenses 4,950
Total expense 39,940
Net operating income $3,140
Required:
Compute the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Answer and Explanation:
The computation of the company's revenue and spending variances for August is shown below:-
Lavage Rapide
Revenue and Spending Variances
For the Month Ended August
Particulars Actual Revenue and Spending Flexible Budget
Results Variances
Actual Cars
Washed 8,800
Revenue $43,080 $40 U $43,120
Less:
Expenses
Cleaning Supplies $7,560 $520 U $7,040
Electricity $2,670 $150 U $2,520
Maintenance $2,260 $500 U $1,760
Wages and
Salaries $8,500 $860 U $7,640
Depreciation $6,000 0 $6,000
Rent $8,000 0 $8,000
Administrative
Expenses $4,950 $70 U $4,880
Total Expense $39,940 $2,100 U $37,840
Net Operating
Income $3,140 $2,140 U $5,280
We simply deduct all expenses from the revenue generated so that the net operating income could arrive
The Lavage Rapide's Revenue and Spending Variances for August are computed as follows:
Income Statement for August
Actual Budget Flexible Budget Variance
Actual cars washed 8,800 8,800
Revenue $43,080 $43,120 $40 U
Expenses:
Cleaning supplies $7,560 $7,040 $520 U
Electricity 2,670 2,520 $150 U
Maintenance 2,260 1,760 $500 U
Wages and salaries 8,500 7,640 $860 U
Depreciation 6,000 6,000 $0 None
Rent 8,000 8,000 $0 None
Administrative expenses 4,950 4,880 $70 U
Total expense $39,940 $37,840 $2,100 U
Net operating income $3,140 $5,280 $2,140 U
Data and Calculations:
Budgeted cars to wash in August = 9,000
Flexible budget = 8,800
Average price per car wash = $4.90
Total budgeted flexible revenue = $43,120 (8,800 x $4.90)
Fixed Cost Cost per Flexible
per Month Car Washed Budget
Cleaning supplies $0.80 $7,040 ($0.80 x 8,800)
Electricity $1,200 $ 0.15 $2,520 ($1,200 + $0.15 x 8,800)
Maintenance $0.20 $1,760 ($0.20 x 8,800)
Wages and salaries $5,000 $0.30 $7,640 ($5,000 + $.30 x 8,800)
Depreciation $6,000 $6,000
Rent $8,000 $8,000
Administrative
expenses $4,000 $0.10 $4,880 ($4,000 + $0.10 x 8,800)
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In October of the current year, received a $15,520 payment from a client for 32 months of security services she will provide starting on September 1 of this year. This amounts to $485 per month. Janine is a calendar-year taxpayer.
a. When must Janine recognize the income from the $17,360 advance payment for services if she uses the cash method of accounting?
1. Year 1
2. Year 2
3. Year 0
4. Year 1 and year 2
5. Year 0 and year 1
b. When must Janine recognize the income from the $17,360 advance payment for services if she uses the accrual method of accounting?
1. Year 0 and Year 1
2. Year 0
3. Year 1
4. Year 1 and Year 2
5. Year 2
c. Suppose that instead of services, Janine received the payment for a security system (inventory) that she will deliver and install in year 2. When would Janine recognize the income from the advance payment for inventory sale if she uses the accrual method of accounting and she uses the deferral method for reporting income from advance payments? For financial accounting purposes, she reports the income when the inventory is delivered.
1. Year 2
2. Year 1
3. Year 0
4. Year 0 and year 1
5. Year 1 and year 2
d. Suppose that instead of services, Janine received the payment for the delivery of inventory to be delivered next year. When would Janine recognize the income from the advance payment for sale of goods if she uses the accrual method of accounting and she uses the full-inclusion method for advance payments?
1. Year 1
2. Year 1 and year 2
3. Year 2
4. Year 0 and year 1
5. Year 0
Answer:
a. When must Janine recognize the income from the $17,360 advance payment for services if she uses the cash method of accounting?
3. Year 0Cash method of accounting recognizes revenues and expenses when they are received or paid for.
b. When must Janine recognize the income from the $17,360 advance payment for services if she uses the accrual method of accounting?
1. Year 0 and Year 1
c. Suppose that instead of services, Janine received the payment for a security system (inventory) that she will deliver and install in year 2. When would Janine recognize the income from the advance payment for inventory sale if she uses the accrual method of accounting and she uses the deferral method for reporting income from advance payments? For financial accounting purposes, she reports the income when the inventory is delivered.
1. Year 2She will recognize revenue only after the merchandise is delivered.
d. Suppose that instead of services, Janine received the payment for the delivery of inventory to be delivered next year. When would Janine recognize the income from the advance payment for sale of goods if she uses the accrual method of accounting and she uses the full-inclusion method for advance payments?
5. Year 0Under this system, advanced payments are considered revenue on the year that they were received.
A company that wanted to increase its capital through equity financing would most likely get involved in which of the following markets?
A. Stock market
B. Bond market
C. Commodity market
D. Currency exchange market
A company that wanted to increase its capital through equity financing would most likely get involved in the stock market.
What is the stock market?This is the market where shares, treasuries and other forms of security are traded.
The market is a place for a company to invest in if they are trying to increase their equity financing.
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Splish Brothers Inc. issues $4.8 million, 5-year, 7% bonds at 102, with interest payable on January 1. The straight-line method is used to amortize bond premium. Prepare the journal entry to record interest expense and bond premium amortization on December 31, 2017, assuming no previous accrual of interest.
Answer and Explanation:
The Journal entries are shown below:-
Interest expense Dr, $316,800
Premium on bonds payable Dr, $19,200 ($96,000 ÷ 5)
To Interest payable $336,000 ($4,800,000 × 7%)
(Being interest expense and bond premium amortization is recorded)
Here we debited the interest expenses and premium on bonds as it increased the expenses and we credited the interest payable as it also increased the liabilities
One thing that moving averages and exponential smoothing have in common is:________
a) they can be used for long range forecasts
b) they are all a form of averages
c) they are always more accurate than time series regression forecasts
d) they result in higher MAPE values
Answer: B). They are all forms of averages
Explanation:
Department 1 completed and transferred out 450 units and had ending work in process inventory of 60 units. The ending inventory is 20% complete for materials and 60% complete for labor and overhead. The equivalent units of production for labor and overhead is
Answer:
486
Explanation:
verified 10/29/2020
Dividends are expected to grow at 25% per year during the next three years, 15% over the following year and then 6% per year indefinitely. The required return on this stock is 9% and the stock currently sells for $79 per share. What is the projected dividend for the second year
Answer:
$1.56
Explanation:
Lets assume the dividend paid for year zero is $1. The growth for the first 3 years is 25% which is given in the question. Now we will find the value of the Projected dividend for year 2 using the compounding formula, as under:
The Projected dividend for year 1 = $1 * (1 + 25%)^ 2 years = $1.56
"When a business establishes a web-site and begins to allow customers to" place orders online without ever coming into their store, they are responding to changes in the:_______
a. social environment
b. economic environment
c. global environment
d. technological environment
Answer: technological environment
Explanation:
Technological environment simply has to do with how science and technology and technological progress has impacted on businesses.
The technological environment is the environment whereby the technological changes affect the marketing efforts of firms. Therefore, a business that establishes a web-site and begins to allow customers to place its orders online without ever coming into their store, is responding to changes in the technological environment.
Ariel, a federal government employee, works in acquisition and procurement. Federal policies require that in contracting with suppliers, at least three bids must be received, and the lowest bid that meets specifications will be accepted. In this case, Ariel is dealing with a(n)
Answer:
Programmed decision
Explanation:
The programmed decision is the decision which are taken on a daily basis or we can day to day basis or routine basis. It is likely for solving the structured problems
In the given case, since minimum three bids are received and the bid who has less value meets the specification that results in an acceptance
Therefore this case is of Programmed decision
Dudley is a manager at the SuperCuts franchise. He has had to fire two employees because they were treating walk-in customers with disdain and thus turning away business. Once those employees were gone, he trained new employees on how to greet customers. Business has been improving and he has realized how important personnel are for a retail business. What role do the personnel play at his SuperCuts franchise?
Answer:
they are the interface between the brand and the customer
Explanation:
Based on the information provided within the question it can be said that the personnel in SuperCuts are the interface between the brand and the customer. The personnel are the ones that interact on a daily basis with the shoppers and provide all the information that they need regarding the SuperCut's brand in order to generate sales.
You would like to have $50,000 saved at the end of Year 5. At the end of Year 2, you can deposit $7,500 for this purpose. If you earn 4.5 percent, how much must you deposit today to reach your goal assuming no other deposits are made
Answer:
The amount that should be deposited today is $33254.58
Explanation:
The deposit should be such that the future value of the deposit made today and at the end of year 2 should be equal to $50000 after 5 years. Let the deposit made today be x. The equation for the future value will be,
50000 = x * (1+0.045)^5 + 7500 * (1+0.045)^3
50000 = x * (1.045)^5 + 8558.745938
50000 - 8558.745938 = x * (1.045)^5
41441.25406 / (1.045)^5 = x
x = $33254.57769 rounded off to $33254.58
On September 12, Vander Company sold merchandise in the amount of $6,200 to Jepson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,200. Jepson uses the periodic inventory system and the gross method of accounting for purchases. Jepson pays the invoice on September 18, and takes the appropriate discount. The journal entry that Jepson makes on September 18 is:
Answer:
Accounts Payable $ 6200 Dr
Purchases Discounts $ 124 Cr
Cash $ 6076 Cr
Explanation:
Periodic inventory system is one in which the entries are passed periodically after a specific length of time.
In the Books of Jepson
Periodic Inventory
Gross Method
Journal Entry
Particulars Debit Credit
Accounts Payable $ 6200 Dr
Purchases Discounts $ 124 Cr
Cash $ 6076 Cr
Discount within the first ten days will be of 2%
$ 6200 *2%= $124
Remaining amount 6200-124 = 6076 will be paid in cash.
Express cost of goods sold as a common-size percentage using the following data. Sales - $45,000; cost of goods sold - $29,340; gross profit from sales - $15,660; operating expenses - $10,800; net income - $4,860.
a. 100%
b. 31%
c. 12%
d. 10.8%
Answer:
Cost of goods sold as a common size percentage= 65.2 %
Explanation:
Cost of goods sold as common size percentage implies the cost of goods sold in absolute is expressed as proportion of the absolute value of Revenue expressed as percentage.
Using the data above = cost of goods sold/Revenue × 100
= 29,340/45,000× 100
=65.2 %
Cost of goods sold as a common size percentage=65.2 %
Suppose a business takes out a $7,000, five-year loan at 6 percent that will be paid annually with a single, fixed payment each period. How much will be the annual payment?
Answer: $1,662
Explanation:
The question is asking for the annual payment that will result in a present value of $7,000 given 6% and 5 years. This payment is constant so is an annuity.
7,000 = Payment * Present value Interest factor of an Annuity, 6%, 5 periods)
7,000 = Payment * 4.212
Payment = 7,000/4.212
= $1,661.92
= $1,662
Ms. Johnson invested $10,000 in a 10-year zero coupon bond and $20,000 in a 3-year semiannual coupon bond that has a duration of 2.5 years. Her portfolio is immunized from interest rate risk if ______.
Answer:
Her investment horizon is 5 years
Explanation:
If investment = $10,000
10-year zero coupon bond
$20,000 in a 3-year semiannual duration = 2.5 years.
Duration = (1/3 )*10 + (2/3)*2.5
= 5 years
A fixed-income portfolio manager sets a minimum acceptable rate of return on the bond portfolio at 4.0% per year over the next 3 years. The portfolio is currently worth $10 million. One year later interest rates are at 5.0%. What is the portfolio value trigger point at this time that would require the manager to immunize the portfolio
Answer:
The portfolio value trigger point at this time that would require the manager to immunize the portfolio would be $12,401,625
Explanation:
In order to calculate the portfolio value trigger point we would have to calculate first the Minimum terminal value as follows:
Minimum terminal value=portfolio value*(1+rate of return)∧3
portfolio value= $10 million
rate of return=4.0%
Hence, Minimum terminal value=$10,000,000*(1.04)∧3
Minimum terminal value=$11,248,640
To calculate the portfolio value trigger point we would have to make the following calculation:
portfolio value trigger point=Minimum terminal value*(1+interest rates)∧2
portfolio value trigger point=$11,248,640*(1.05)∧2
portfolio value trigger point=$12,401,625
The portfolio value trigger point at this time that would require the manager to immunize the portfolio would be $12,401,625
Hillary Pillary, age 22, is a full-time student at Diploma Mills College and is awarded a master s degree at the end of the current year. Her tuition, fees, books, and supplies are $10,000 for the year. During the year, she received the following payments:
Scholarship for the year $7,000
Loan from college financial aid office $3,000
Cash prize awarded in beauty contest $2,000
Gift from Aunt Sue $1,000
What amount of these payments is taxable to Hillary for the current year?
A. $1,000
B. $2,000
C. $3,000
D. $5,000
E. $13,000
The deadweight loss of the profit-maximizing monopoly is identified by what area?
Answer:
area BCA
Explanation:
The deadweight loss of the profit-maximizing monopoly is recognize by area BCA.
Under the deadweight loss of monopoly More is produced under ideal or perfect competition than under monopoly, and deadweight loss is refer to as the amount that buyers value the added or additional output over and above the opportunity costs of producing the additional output.
When a monopoly maximizes profit, the deadweight loss will be larger if demand is in elastic because there will be a reasonable margin of price to marginal cost.
XYZ's stock price and dividend history are as follows: Year Beginning-of-Year Price Dividend Paid at Year-End 2017 $ 170 $ 3 2018 200 3 2019 150 3 2020 170 3 An investor buys three shares of XYZ at the beginning of 2017, buys another two shares at the beginning of 2018, sells one share at the beginning of 2019, and sells all four remaining shares at the beginning of 2020. a. What are the arithmetic and geometric average time-weighted rates of return for the investor
Answer:
The arithmetic average time-weighted rates of return for the investor is 4.19%
The geometric average time-weighted rates of return for the investor is 2.124%
Explanation:
The arithmetic average return is simple average returns of stocks, calculated as: Arithmetic average return = Sum of returns/ number of years
While geometric average return is calculated as: Geometric average return = number of years√ {(1+r1)*(1+r2)*(1+r3)…} -1
Where r1, r2, r3…are the returns for year 1, 2, 3….
Yearly Return = {(capital gains + dividend)/price}*100
Return from 2017-2018= {(200 - 170) + 3} /170 *100 = 19.41%
Return from 2018-2019 = {(150 - 200) + 3} /200*100 = -23.5%
Return from 2019-2020 = {(170 - 150) + 5} /150 *100 = 16.67%
Hence, Arithmetic mean = (19.41% -23.5% +16.67%)/3 = 12.58%/3 = 4.19%
While Geometric mean = [(1+19.41%)*(1-23.5%) *(1+16.67%)] ^ (1/3) -1
= (1.1941 *0.7650 * 1.1667) ^1/3 – 1 = 0.02124 = 2.124%
The arithmetic average time-weighted rates of return for the investor is 4.19%
The geometric average time-weighted rates of return for the investor is 2.124%
A special tax was levied by Downtown City to retire and pay interest on general obligation bonds that were issued to finance the construction of a new city hall. Where are the receipts from the tax recorded?
a. Capital Projects Fund
b. Special Revenue Fund
c. Debt Service Fund
d. General Fund
e. None of the above
Answer:
C. Debt Service Fund.
Explanation:
Dept service funds can be described as monies or reserves which are been used to pay for capitals, interest and certain dept that have accrued by the company and it can cover for any other form of dept owed by the company.
It's existence is put in place to reduce the risk of a debt security for future investors. This can be paid out monthly mid-monthly, quarterly or possibly yearly.
This why the tax on general obligation bonds that has been put upon Downtown city to finance the hall has it receipts in place at the dept service fund office.