An example of the __________ is a product development specialist who bases a decision to not launch a new product on her recent
1 answer:
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Answer:
a. Contribution from Berry = $6,000
b-1. Contribution from Hammond = $22,556
b-2. Disbursement shall be:
Anderson = $8,889
Berry = $3,667
c. Amount to be received by Anderson on Liquidation = $11,500
Explanation:
As for the provided information we have,
Capital balances
Anderson 40% $20,000
Berry 30% $12,000
Hammond 20% $17,000 (Deficit)
Winwood 10% $25,000 (Deficit)
a. Total deficit in this case will be = Share of Hammond + Winwood = $17,000 + $25,000 = $42,000
Berry's share =
Since Berry's current balance = $12,000
Contribution required = $18,000 - $12,000 = $6,000
b-1. Total deficit of Winwood = $25,000
Hammond share =
Hammond's current balance = - $17,000
Thus, contribution from Hammond = $5,556 + $17,000 = $22,556
b-2. Total deficit balance = $17,000 + $25,000 = $42,000
Total sufficient balance = $20,000 + $12,000 = $32,000
Net deficit balance = $42,000 - $32,000 = $10,000
Anderson share in Deficit of Winwood =
Thus, net capital of Anderson = $20,000 - $11,111 = $8,889
Berry's share in deficit of Winwood =
Thus, net capital from Berry = $12,000 - $8,333 = $3,667
c. Total deficit from Hammond = $17,000
Anderson share =
Anderson's current balance = $20,000
Amount extra contributed by Anderson = $20,000 - $8,500 = $11,500
Thus, Anderson will receive $11,500 on liquidation.
Final Answer
a. Contribution from Berry = $6,000
b-1. Contribution from Hammond = $22,556
b-2. Disbursement shall be:
Anderson = $8,889
Berry = $3,667
c. Amount to be received by Anderson on Liquidation = $11,500
Answer:
1. Discount
2. $449,298.47
3. $369,298.47 gain
4. land reduces by $80,000, investment increases by $449,298.47, reserves increases by $369,298.47
Explanation:
Question 1
Using the formula below
where
I = interest rate, which is 6% of 500,000 = 30,000
F = Face value, 500,000
r = borrowing cost = 12%
Therefore, the price of the note at the time it was used for payment was
= $449,298.47.
As the price is lower than the face value of the note, the note was issued at a discount.
Question 2
The fair market value of the note is $449,298.47, the compute price in question 1.
Question 3
The gain/loss on the sale of the land
= sale price - purchase price
= $449,298.47 - 80,000
= $369,298.47.
Question 4
The transaction would affect Crabb & Co's balance sheet as follows.
<em>Asset side:</em>
land reduces by $80,000
investment increases by $449,298.47
<em>Equity & liabilities side:</em>
reserves increases by $369,298.47