Answer:
Annual depreciation (year 2)= $20,000
Explanation:
Giving the following information:
Purchase price= $115,000
Salvage value= $15,000
Useful life= 5 years
<u>To calculate the annual depreciation under the straight-line method, we need to use the following formula:</u>
<u></u>
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (115,000 - 15,000) / 5
Annual depreciation= $20,000
Answer:
Discount on bond payable
Explanation:
since in the question it is mentioned that the company has issued the common stock warrants also the cash proceeds is more than the sum of the fair value + face value
So we presume that the bond are to be sold at the discount
Therefore the excess should be reported as the discount on bond payable
Answer:
28%
Explanation:
Most mortgage lenders, including Fannie Mae, use the 28/36 rule. That rule states that a family should spend no more than 28% of the gross monthly income (GMI) on housing expenses, and pay no more than 36% of GMI to cover debts (mortgage payments are included in this 36%).
Statistics show that households that do not comply with the 28/36 rule, tend to have difficulty paying back loans.
Answer:
Pay the claim and the accident occurred during the grace period
Explanation:
Grace period is the period or the set length of the time after the due date during that the payment is to be made without any penalty by the insurer or the person.
The grace period mostly is of 15 days and it is usually involves in the insurance contact and the mortgage loan.
So, in this case, the insurer forget to pay the premium but on march 19, she met with an accident and broke her leg, then the insurance company will be paying the claim as the accident happened during the grace period.
The answer for this question is: Purchasing plant and equipment that worth more than the cash that they have.
By doing this, the company will be forced to find some funds that is not included in Company's budget, and the easiest method to do that is by searching for an emergency loan or by selling other assets that are not crucial for their operation.
