Answer:
$300,800
Explanation:
First Calculate the proceeds from the issuance of the bond
Proceeds from bonds = Face value x Price rate = $320,000 x 106% = $339,200
Now calculate the fair value of the warrant issued
Fair value of warrant = Numbers of shares x Stock per bond x Market value of each Warrant = ( $320,000 / $1,000 ) x 40 x $3 = 320 x 40 x $3 = $38,400
Liability Portion = Procedds from bonds - Fair value of waarants = $339,200 - $38,400 = $300,800
Answer:
Overcosting may result in competitors entering a market and taking market share for products that a company erroneously believes are low-margin or even unprofitable. Undercosting may result in companies selling products on which they are in fact losing money, when they erroneously believe them to be profitable.
Explanation:
The manager would worry withe overcosting or understanding of product as the overcosting would be done when the competitors are entered in the market and they took the market share so that the company could trust that they are less margin while on the other hand undercosting means the company that sells the product also at the same time they are losing the money when they trust to be profitable
Answer:
($500) = NA + NA + ($500)
Explanation:
In this question, the following accounting equation is used
Assets = Liability + common stock + retained earnings
As in the transaction, it is given that $500 cash is paid for advertising expense, so this event would be affecting the accounting equation for asset and the retained earning account i.e
($500) = NA + NA + ($500)
As cash is paid which reduces the asset balance plus the retained earning balance is also get reduced by $500
Answer:
The correct answer is $13,325.
Explanation:
According to the scenario, the given data are as follows:
Total sales = $487,000
Cost of goods sold = $394,500
Depreciation expense = $43,800
Interest paid = $18,200
dividends paid = $6,500
Tax rate = 35%
so, first we calculate net income.
Net income = ( Total sales - Cost of goods sold - Depreciation expense - Interest paid ) - 35%
= ($487,000 - $394,000 - $43,800 - $18200 ) - 35%
= $30,500 - $10,675
= $19,825
Addition to retained earnings = Net income - Dividends Paid
= $19,825 - $6,500
= $13,325
Hence, the correct answer is $13,325.
