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2 years ago

Provide a comprehensive discussion of information asymmetry in financial intermediation.

Business

1 answer:

Zigmanuir [339]2 years ago

3 0

The introduction of intermediaries helps in minimizing the asymmetric information gap by becoming experts.

<h3>What is information asymmetry?</h3>

Information Asymmetry deals with the study of decisions in transactions where one party has more or better information.

The financial intermediary establishes trust by providing a form of guarantee of investment performance to the buyer of securities and a fair price to the sellers of securities.

Learn more about Information asymmetry here:

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Write age and snap if your a girl if your a boy do the same and we can be friends if you want to

Masja [62]

Explanation: dont have friends

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3 years ago

Each of the following items must be considered in preparing a statement of cash flows. Indicate where each item is to be reporte

otez555 [7]

Answer:

Answer 1 - increment in money due will go under working exercises and $4000 will be appeared in negative there since it will decrease the money balance

Answer 2 - issuance of preferred stock will go under financing exercises and since they are giving offers so income will increment by $115 × 10000 = $1150000

Answer - 3 For devaluation Because we start setting up the announcement of incomes utilizing the overall gain figure taken from the salary explanation, we have to alter the net gain figure with the goal that it isn't diminished by Depreciation Expense. To do this, we include back the measure of the Depreciation Expense. So we have to add $14000 to net gain of $90000

For bond premium amortization, its recorded in the working exercises area of the announcement of incomes. Under the roundabout strategy, the amortization of security premium is deducted from net gain since it decreases premium cost and, along these lines, expands net gain without a real money inflow.

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3 years ago

Read 2 more answers

Concord Company had bonds outstanding with a maturity value of $311,000. On April 30, 2017, when these bonds had an unamortized

Dmitrij [34]

Answer:

<u>Redemption of Old Bonds</u>

4-30-17 Bonds Payable $311000 Dr

Loss on Bond Redemption $26550 Dr

Discount on Bonds Payable $11000 Cr

Cash $326550 Cr

<u>Issuance of New Bonds</u>

3-30-17 Cash $314110 Dr

Premium on Bonds Payable $3110 Cr

Bonds Payable $311000 Cr

Explanation:

<u>Redemption of Bonds Payable</u>

The maturity value for bonds payable is equal to the face value of these bonds. This means that the face value of old bonds was $311000.

The bonds were carrying a discount. Thus, the carrying value of bonds was

Carrying value = Face value - Discount

Carrying value = 311000 - 11000 = $300000

Bonds with a carrying value of $300000 were redeemed at 105% of the face value. The cash paid for redemption is,

Cash paid = 311000 * 105% = 326550

Thus, there was a loss on redemption of = 326550 - 300000 = $26550

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<u>Issuance of Bonds Payable</u>

The bonds were issued at 101% of the face value which means they were issued at a premium.

The amount of premium on these bonds is,

Premium = Carrying value - Face value

Premium = 311000 * 101% - 311000

Premium = $3110

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3 years ago

Why is it important to know the interest rate on your credit card?

Irina18 [472]

A

When you go into credit (the red) you basically loan money which means that you have to pay a "fine" called interest. so the more you loan and depending on the type of loan, the more interest you will pay.

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3 years ago

Net working capital decreases when: A. a dividend is paid to current shareholders. B. a new 3-year loan is obtained with the pro

dsp73

Answer:

A. Dividend is paid to current shareholders.

Explanation:

This is simply said to be the aggregate amount of all current asset and also all current liability of an investment. It is used in measuring the short term liability of a business by subtracting the current liability from the current asset.

In some cases, it can be tagged a company’s current assets, such as cash, accounts receivable, inventories of goods etc. Many companies sum their's by calculating cash plus accounts receivable plus inventories, less accounts payable and less accrued expenses. This is why it is seen to decrease when dividend is paid to current shareholders.

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3 years ago