Answer:
d. treasury and top-grade corporate bonds pay interest two times each year
Explanation:
Treasury bonds represent the best solution for investing, having in mind the <u>low-risk aspect</u> and the fact that they are <u>issued by the government</u>. Treasury and top-grade corporate bonds always pay <u>semiannual interests</u>.
<em>Junk bonds</em> should not be even considered in risk-free options, as a junk bond is a bond issued by a struggling company, which may happen not to pay any interest sometimes.
<em>Common stock</em> does not necessarily have to pay quarterly dividends, as some companies pay dividends monthly, or even annually. Also, the risk is still lower in treasury bonds, as common stock becomes questionable in the case of company liquidation. If and when that happens, common stockholders gain rights to company assets only after bondholders and preferred shareholders become paid.
The default risk is present in all bonds, including <em>Yankee bonds</em>, which are issued by foreign companies in the USA.
Both the inventory balance of the buyer and the seller
Answer:
$700 (not given in the options)
Explanation:
When the policy is purchased with a payment made in advance, the entries recorded are
Debit prepaid insurance $8,400
Credit Cash account $8,400
After the first month, the expense incurred is
= 1/12 × $8,400
= $700
Entries then required
Debit Insurance expense $700
Credit Prepaid Insurance $700
<u>All that applies to be in existence of a partnerships are:</u>
- Sharing of profits or loses
- joint ownership of the business
- equal right to be involved in the management of the business.
Option B, C and D.
<u>Explanation:</u>
Partnerships is an agreeable association of any 2 members or more than two members to pursue any business co-relatively together, as a profit business. Therefore, the essentials of a partnerships are most importantly joint ownership of the business as the business of profit must be jointly held by the partners.
Other essentials include the equal right to be involved in the management and enjoying the shares of the profits as well as suffering the share of the losses in the business co- owned.
Answer: $8,391.90
Explanation:
So the company borrowed $40,000 from a bank.
They are to pay 7% interest on the note per year for 6 years.
We are to find the annual payments.
7% represents a constant payment schedule per year so we can use an Annuity formula.
Seeing as the Annuity factor has been calculated for us already we don't need to formula though.
The present value of an annuity factor for 6 years at 7% is 4.7665.
Calculating the present value of the annual payment can be done as follows,
= Amount / PVIFA (Present Value Interest Factor for an Annuity)
= 40,000/4.7665
= 8391.90181475
= $8,391.90
The annual payments equal $8,391.90.