Rushmore Company provided services for $45,000 cash during Year 1. Rushmore incurred $36,000 of operating expenses on account du
ring Year 1, and by the end of the year, $9,000 of that amount had been paid with cash. If these are the only accounting events that affected Rushmore during Year 1, which of the following statements is true?
1 answer:
Answer:
The amount of the net income shown on the income statement is $9,000
Explanation:
The computation of the net income is shown below:
Net income = Services provided for cash = operating expenses incurred
= $45,000 - $36,000
= $9,000
According to the matching principle, the revenues of a particular period should always be matched with the expenses that are incurred in that particular year
So, the net income that is to be reported on the income statement is $9,000
Note: Options are shown in the attachment
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Answer:
The expected return that IMI can provide subject to Johnson's risk constraint is 8.5%
Explanation:
Capital Market Line (CML)
Expected return on the market portfolio, E() = 12 %
Standard deviation on the market portfolio, σ = 20%
Risk-free rate, = 5%
E() =
+ [ E(
) -
] × ( σ
÷ σ
)
= 0.05 + [ 0.12 - 0.05] × (0.10 ÷ 0.20)
= 8.5%