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notsponge [240]
2 years ago
9

In the trial balance for March, you see that Notes Receivable-Fast Feet Co. has a negative balance of $135, which would seem to

indicate that Fast Feet paid too much. Looking back through the journal entries for March, you find that on March 19 the accounting intern recorded receipt of $4,635 in payment of this note receivable. Further investigation reveals that on November 19, 20Y7, this note receivable was received from Fast Feet Co. for $4,500. You can find no additional information about this note in the accounting records. Assume a 360 day year.Using the preceding information, compute the term and the interest rate of the note receivable from Fast Feet.1. Term of the note: _____days2. Interest rate of the note: ______ %3. Journalize the entry needed to record information about the note receivable from Fast Feet for the year
Business
1 answer:
eduard2 years ago
3 0

Answer:

Explanation:

1. The computation of the term of the note is shown below:

It is computed from the November 19 to March 19

So,

November - 11 days

December - 31 days

January - 31 days

February - 28 days

March - 19 days

Total - 120 days

2. In this part, we apply the simple interest formula which is shown below:

Simple interest = Principal × interest rate × (number of days ÷ total number of days in a year)

$135 = $4,500 × interest rate × 120 days ÷ 360 days

$135 = $4,500 × interest rate × 0.3333

So, the interest rate is 9%

We assume the 360 days in a year

And, the simple interest is computed by $4,635 - $4,500 = $135

3. The journal entry is shown below:

Interest expense A/c Dr

      To Interest payable

(Being the interest expense is recorded)

The computation of the interest expense is shown below:

= November note receivable × interest rate × (number of days ÷ total number of days in a year)

= $4,500 × 9% × 42 days ÷ 360 days

= $47.25

We assume the entry is made on November 19 and the books are closed on December 31

So, the 42 days would be 11 days of November and 31 days of December

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On April 1, 2016, the KB Toy Company purchased equipment to be used in its manufacturing process. The equipment cost $57,200, ha
Harman [31]

Answer:

2016 Depreciation

Dr depreciation expense $5720

Cr Accumulated depreciation               $5720

2017 Depreciation

Dr depreciation expense $5720

Cr Accumulated depreciation               $5720

Journal entries for 2018 expenditure

Dr repairs and maintenance   $2900

Dr Equipment account             $11850

Cr Cash account                                          $14750

2018 Depreciation

Dr depreciation expense          $4800.83

Cr Accumulated depreciation                     $4800.83

Explanation:

There are two policies for depreciating non-current asset  especially when it is acquired part-way through the year like we have here, namely full year depreciation in the year of purchase and none in the year of disposal or proportional depreciation throughout the useful life,I am adopting the former in this question.

Formula for depreciation=cost-residual value/useful life

Yearly depreciation is ($57200-$0)/10=$5720

However,after two years the book value is calculated thus:

Book value=$57200-($5720*2)=$45760

additional cost incurred in enhancing the capacity of the asset would be added :  $45760 +$11,850=$57610

Since the useful life has also been reviewed up to 12 years, the depreciation from now on is $57610/12=$4800.83

5 0
2 years ago
Read 2 more answers
4. Now that you have calculated the number of workers needed each period in Problem 3, Tameka wants to see how the plan would ac
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Answer:

47

Explanation:

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8 0
2 years ago
Exercise 13-17 Swifty Company has been operating for several years, and on December 31, 2017, presented the following balance sh
mixer [17]

Answer:

(a) Current ratio = 2.746

(b) Acid-test ratio = 1.423

(c) Debt to assets ratio = 47.48%  

(d) Return on assets = 6.15%

Explanation:

For Balance Sheet, pleased see attached file.

Current Ratio = Current Asset / Current Liabilities

Current Ratio = 212,800 / 77,500

Current Ratio = 2.746

Acid-Test Ratio = (Current Assets – Inventories) / Current Liabilities

Acid-Test Ratio = (212,800 – 102,500) / 77,500

Acid-Test Ratio = 1.423

Debt to Asset ratio = (Total Liabilities / Total Assets)*100

Debt to Asset ratio = (205,500 / 432,800)*100

Debt to Asset ratio = 47.48%

ROA = (Net Income / Total Assets)*100

ROA = (26,600 / 432,800)*100

ROA = 6.15%

The Current Ratio is a liquidity measure that shows the ratio between current asset and current liabilities. It tells how many dollars of the current asset are per dollar of current debts, that gives an idea of the company`s ability to perform its debts.    

The Quick Ratio is also a liquidity indicator, but using its most liquid assets, to pay its current liabilities at maturity. The inventory, although it is a current asset, is not considered, since it cannot be converted into cash in a very short term.

The difference between the Quick Ratio and the Current Ratio, implies that while both are measures of the company's ability to pay its debts, the quick ratio also tells how much the company depends on its inventory to get that objective.

The Debt to Assets ratio is a financial ratio that shows how much of a company assets is owed to its creditors.  

ROA is a financial indicator that gives an idea as to how efficient a company's management is at using its assets to generate earnings, by determining how profitable a company is relative to its total assets.

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3 years ago
When evaluating service quality, _____ refers to the knowledge and courtesy of employees and their ability to convey trust. a. a
sesenic [268]

An assurance means the knowledge and courtesy of employees and their ability to convey trust.

<h3>What is an assurance?</h3>

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Hence, in evaluation of service quality, its means the knowledge and courtesy of employees and their ability to convey trust.

Therefore, the Option A is correct.

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How does the trade benefit the society?
alexdok [17]

Answer:

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