An investor purchased 10 go bonds at a discount of 2 points per bond. the bonds mature in 10 years. after holding the bonds for 5 years, they were sold at par. for tax purposes, the investor has a $100 gain.
The cost per bond is $980. The accretion amount each year is $20. $20 ÷ 10 years = $2 per year. $2 per year × 5 years = $10 per bond accretion, making the adjusted cost basis $990 per bond.
When the bonds are sold at par ($1,000), there is a profit of $10 per bond × 10 bonds, which equals a $100 gain.
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Answer:
Company Setup, Bank Activity, Transaction Volume and Client Mileage
Explanation:
The nature of a company setup is an important aspect to perform a high level review. The set up of the company i.e. Private Ltd. or Public Ltd. or the goal and the motive of the company its operation to earn revenue are important aspects of a high level review. Not only the company set up but also the Banking Activity, Transaction Volume and Client Mileage are also some important areas in which the review takes place. if the company has a large volume of transaction and as well as it is doing a good amount of business with the banks then it can be said that the company is healthy. Moreover the customer satisfaction is an important aspect of a high level review. The following other options are incorrect because they are less important for a high level review.
Answer:
(A) $10,000
Explanation:
The beginning of the partnership basis for tax purposes consists of all the money paid to the partnership which is $10, 000. The comission fee $1,000, the up-front costs which are $500 for legal expenditures, and $500 for organization costs are all included in the $10000 price and are integral part of the beginning basis. There are no up front deductions for these costs.
Adjustments to the beginning basis will occur after the partnership's first year of operations. At that point, a K-1 is issued, showing that partner's share of partnership income and loss; and any cash distributions made by the partnership or additional cash contributions made to the partnership. All of these items are netted against the beginning basis to arrive at the year-end adjusted basis. So the customer's beginning tax basis is $10,000.
<u>Answer:
</u>
The national competitive advantage of industries theory is the one that is based on the notion that competitive advantage is dependent on the four interacting aspects of factor endowments, domestic demand, firm strategy, and related and supporting industries.
<u>Explanation:
</u>
- Some countries bear a competitive advantage over other countries in producing certain commodities owing to the availability of resources in abundance that are required to produce the given commodity within the domestic boundaries.
- This advantage allows certain countries to fetch a greater profit than other competitor countries from trading in the same commodity as the initial cost of producing the commodity is low in some countries and high in some other.
Answer:
Break-even point in dollar sales
= <u>Fixed cost</u>
Contribution margin ratio
Product T
Contribution margin ratio
= <u>Contribution</u>
Sales
= <u>$408,000</u>
$1,020,000
= 0.40
Break-even point in dollar sales
= <u>$258,000</u>
0.4
=$645,000
Product O
Contribution margin ratio
= <u>$816,000</u>
$1,020,000
= 0.80
Break-even point in dollar sales
= <u>$666,000</u>
0.80
= $832,500
Explanation:
In this case, we need to calculate the contribution margin ratio of the two products, which is the ratio of contribution to sales. Then, we will determine the break-even point in dollar sales, which equals fixed cost divided by contribution margin ratio.