Answer:
a. Profit(loss) = Total revenue - Total expenses
= 131,000 - 90,500
= $41,000
The company did in fact generate<u> profit of $41,000 </u>and this can be shown from the Income Statement which is where profit or loss is calculated.
b. A company uses its assets to pay off its liabilities so if the liabilities are less than the assets then the company is capable of paying off its liabilities:
Assets = Cash + Accounts Receivable + Supplies
= 30,800 + 25,300 + 40,700
= $96,800
Liabilities are just the Accounts Payable of $25,700.
<em>Liabilities are less than Assets so Miami Music does indeed have sufficient resources to pay its liabilities. </em>
This information comes from the <u>Balance Sheet</u> which is where assets and liabilities are shown.
Answer:
Predetermined manufacturing overhead rate= $1.2 per direct labor dollar
Explanation:
Giving the following information:
Company estimates total manufacturing overhead costs of $882,000 and, direct labor costs of $735,000
<u>To calculate the predetermined overhead rate, we need to use the following formula:</u>
<u></u>
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 882,000/735,000
Predetermined manufacturing overhead rate= $1.2 per direct labor dollar
Answer:
The correct option is C,$500
Explanation:
The amount of interest accrual is the interest on the sum borrowed from October 1 2016 to 31 December 2016,that is 3 months of interest,which is computed below:
Accrued interest =principal*stated interest rate*number of accrued months/12
principal is $25,000
stated interest is 8%
number of accrued months is 3
accrued interest =$25,000*8%*3/12=$500
The accrued interest is to be debited interest expense because it is an increase in expense and credited to interest payable as a liability
Answer:
current yield 8.2089552%
YTM = 8.05%
effective annual yield = 4.92%
Explanation:
(A)
current yield = C/P
coupon payment / market price
8.8/107.2 = 0.082089552 = 8.2089552%
(B)
First par being the present value of the coupon payment and second the redeem of the face value at the end of the bond.
market price 107.2
face value 100
time = 19
rate 8.8%
C = annual coupon payment 100 x 8.8% = 8.8
You solve this using a financial calculation and get the semiannual rate
YTM/2 = 0.040268160
then multiply by 2 to get the annual YTM
0.040268160 x 2 =
YTM = 0.08053632 = 8.05%
(C)
Effective Annual Yield
where:
Holding period return:
In this case:
coupon payment + redem - investment = net return
8.8 * 19 + 100 - 107.2 = 160
160/107.2 = 1.492537313
Then
EAY = 0.049242509 = 4.9242509%
