Answer:
The seller must be informed when the offer is presented that the depositis a promissory note
Explanation:
A good faith deposit is one that is done by a buyer in which conditions are stated that could result in the loss of deposit by the buyer.
It is a deposit made by the buyer to show he intends to complete the payment later.
In this instance if there is a Goodwill deposit in form of a promissory note, the broker needs to be aware.
So that when he is bringing in a client he will consider the already existing deposit.
Deals that offer more deposit or full payment will be considered and the original buyer discarded.
Answer:
a. 1.27%
b. 15.24%
c. 16.35%
Explanation:
a. What is the monthly return on this investment vehicle?
The formula for the value of a Perpetuity is;
Value = Payment/ rate
Rate = Payment/ Value
Rate = 1,450/114,000
= 0.0127
= 1.27%
b. What is the APR?
APR is the annual rate. The above figure is the monthly rate.
APR = Monthly rate * 12
= 1.27 * 12
= 15.24%
c. What is the effective annual return?
Effective annual return = [1 + (APR/n)]^n – 1
n is the number of compounding periods which is 12 here for monthly compounding.
= [1 + (15.24%/12)]^12– 1
= 16.35%
Answer: The free enterprise economy seeks to maintain economic freedom. As mentioned earlier, the goal is for businesses to be able to make their own decisions with little government interference. Efficiency - The goal of efficiency is to make the best use of the resources that are available.
Answer:
e) Credit to Revenue
Explanation:
The services provided to customers will be an increase of revenue and an increase in revenues is a credit transaction.
Since the question does not mention that the services were billed therefore the accounts receivable will not be increased till it is billed and thus option a) is not applicable.
The other options are not relevant since there is no cash collection involved, and no liabilities involved.