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Rufina [12.5K]
3 years ago
9

On October 1, 20X1, a company purchased a piece of land by agreeing to pay the seller $450,000 in two years. If the company had

borrowed the money from a bank to pay the seller immediately, management estimates the bank would have required interest of 9%. Calculate the amount of interest expense the company would record for its year ending December 31, 20X1 (rounded to the nearest dollar).
a. $40,500.
b. $9,289.
c. $10,125.
d. $8,522.
Business
1 answer:
Vitek1552 [10]3 years ago
7 0

Answer:

The answer is c. $10,125.

Explanation:

interest rate = 9%

loan amount= 450000

time = 0.25years

Interest charge = 450000* 0.25 * 0.09 =$10,125.

The interest  charge will be $10,125 because the loan was taken in October and the financial year  ends in December, which makes it 3 months which is 0.25 years.

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Answer:

Please find the income statement below;

Explanation:

<u>Single step Income statement</u>

Revenues

Net sales              2,419,200

Interest revenue        39,300

<em>Total revenues                                2,458,500</em>

Expenses

Cost of goods sold      1,464,600

Admin. expenses            216,400

Selling expenses            294,800

Interest expense               46,000

<em>Total expenses                                   2,021,800</em>

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Answer:

I would be willing to pay $ 32.83  for each share of Johnson Enterprises

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share price=$3.25/(15%-5.1%)

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The share can be sold today for $ 32.83  ,which is the present value of dividends payable in perpetuity(forever)

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How is a post from a social media influencer different than a comment from a regular consumer?
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The influencer is paid to post the product

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$7.830

Explanation:

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Second step is to compute for the Equivalent unit of conversion

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