Answer:
Explanation:
The journal entry is shown below:
Interest expense A/c Dr $3,000
To Interest payable A/c $3,000
(Being interest is recorded)
The computation of the interest expense is shown below:
= Principal × rate of interest × number of months ÷ total number of months in a year
= $125,000 × 6% × (4 months ÷ 12 months)
= $2,500
The four-month is calculated from the September 1 to December 31
Answer:
= $27,000 favorable
Explanation:
<em>Direct material price (cost) </em><em>occurs when the actual quantity of materials are purchased at an actual price per unit higher or lower than the standard price.</em>
<em>Direct material efficiency( usage variance)</em><em> occurs when the actual quantity used used to achieve a given output is more or less than the standard quantity expected to achieve same.</em>
The Direct material total cost variance is the sum of the direct material price variance and the direct material usage variance.
So we can determine the total direct materials variance of the company as follows:
= 9,000 unfavorable + $36,000 favorable
= $27,000 favorable
Answer:
Option A will be the correct answer.
Explanation:
In the above question, Options are not given. Please find the attachment of the complete question.
- RIA has become an individual or an organization that offers investment advice to high-net-worth investors as well as operates financial investments.
- This RIA rendered complete transparency, both oral and written form, to his shareholders, because of options techniques to be implemented and the fees associated. This would be the smartest method to do something about it.
Some other options are also not tied to the condition in question. Thus option A should be the perfect approach.
Answer:
The expected return on equity for Company Y is:
= 0.21 or 21%
Explanation:
a) Data and Calculations:
Company X Company Y
Market value of assets 1,000 1,000
Equity 1,000 500
Debt 0 500
Expected return on equity 15%
Expected return on debt 9%
Return on Company X = 150 (1,000 * 15%)
Return on Company Y debt = 500 * 9% = 45
Return on Company Y equity = (150 - 45)/500 = 0.21
b) Under perfect capital market conditions, the total return for Company Y will be equal to 150 as in Company X. The rate of return will then be determined after subtracting the interest on debt (500 * 9%). This will leave 105 as the return for equity. This amount is then divided by the value of equity to derive the rate of return.