Answer:
An optional Call
Explanation:
Callable Bond
Callable bond represents an instrument of debt where the issuer issues the instrument reserving the right to make a return of the principal of investors including the stoppage of interest payments before the date of maturity of the bond.
Organisations would usually issue bonds as callable when either to meet unexpected obligations like pay off other debts, fund expansions or when they sense that opportunities may arise in the future for them to get other forms of financing at lower interest rates.
For bonds to be callable the terms must be clearly stated in the bond's offering.
Optional Call
In optional call, the issuer reserves the right to call the bonds to take advantage of present circumstances such as significant drop in interest rates (as stated in the question). However, the terms detailed in the bond resolution will allow the bondholders to receive a premium to par as compensation for their loss of interest payments on the called bond.
Furthermore, a period of time must usually pass before the issuer can use the optional call.
Answer:
Explanation:
1.
Shareholders equity = Common stock + Retained earnings
Beg. balance = Common stock+Retained earnings = 166,000 + 66,000 = 232,000
Statement of shareholder's equity
Beg balance 232,000
Issuance of common stock 56,000
Add: Net Income 46,000
Less: Dividends 11,600
End balance 322,400
Balance sheet
There is not information for preparation of balance sheet but following is the layout:
Assets:
Cash
Supplies
Prepaid rent
Land
Liabilities:
Accounts payable
Salaries
Utilities
Notes payable
Stockholder's equity:
Common stock 222,000 [166,000+56,000]
Retained earnings 112,000 [66,000+46,000]
Total 334,000
Answer:
Date Account titles and explanation Debit Credit
May 20 Cash ($6,200 - $310) $5,890
Credit card expenses ($6,200*5%) $310
Sales $6,200
(To record the deposit)
Answer:
11.97%
Explanation:
Common size statement value of inventory is where all accounts are expressed as a percentage of total assets.
Total assets = Net fixed assets + Current assets
= $544 + $300
= $844
Common size statement value of inventory = Inventory ÷ Total assets
= $101 ÷ $844
= 0.1197
= 11.97%
