Answer:
Consider the following explanation
Explanation:
Under Effective interest method, Interest calculated at the effective interest rate (i.e., the yield of the bond) is charged as an expense annually, and the payment made basis the Coupon rate.
In the given case, interest to be paid semi annually i.e, on June 30 and on December 31, will be $62,500 (i.e., 2,500,000 * 5% * 6/12).
On the basis of above, the interest expense to be charged in the 2017 can be calculated as follows: take a look to the attached archive.
As calculated above, the amount to be charged as interest expense for the year 2017 is (80,220 + 80,840 i.e.,) $ 161,060.
<span>Chris may be able to recover money from the courts on the basis of quasi contract. A quasi contract is an obligation of one party to another imposed by law independently of an agreement between the parties.</span>
Answer would be .24, according to my "calculations"
Answer:
d. Overstate, understate, understate, zero
Explanation:
The amount of earnings overall is the same. so, in the end, there is n difference in retained earnings.
But, on accrual accounting, the note should not enter the accounting as 1,000 as time value of money exist.
At 2016 the sales revenue should be the present value of 1,000 dollars not the complete 1,000 dollars. Thus, is overstated.
Then, the interest accrued from the note are not recognized. Thus, the first year (2016) recognize revenues that should be matched with 2017 and 2018
Thus, these two subsequent years ended understated.