Answer:
Investment D would have the lowest present value
Explanation:
A is smaller compared to E, This is because the money comes in later
The same argument holds for B and C, that is, B is lower compared to C because the money comes in later too.
A is also lower than B, this is because of the annuity to be received later is larger.
D is just one payment, which means D is the right answer compared to A
This means investment D would have the lowest present value compared to all other investment choices.
Answer:
insurance expense 1,250 debit
prepaid insurance 1,250 credit
Explanation:
the insurance contract is for 2 year so, 24 months
3,000 is the value of 24 month of insurance:
3,000 / 24 = 125 per month
From March 1st, 2018 to December 31th,2018 --> 10 months
125 x 10 = 1,250
This is the case of an accrued expense.
Our prepaid insurance will decrease by this amount and we will recognize the 1,250 insurance expense.
Answer:
A. uses a percentage of sales method to estimate uncollectible accounts
Explanation:
Difference between the direct write-off and the allowance method for accounting for bad debts are the timing of when bad debts are reported on the books and their ultimate impact on the income statement and balance sheet