Answer:
The amount of amortization expense each year is $500,000.
Explanation:
This can be calculated as follows:
Patent original cost = $3,000,000
Salvage value after 5 years = $500,000
Number of years to use before selling it = 5 years
Therefore, we have:
Annual amortization expense = (Patent original cost - Salvage value after 5 years) / Number of years to use before selling it = ($3,000,000 - $500,000) / 5 = $500,000
Therefore, the amount of amortization expense each year is $500,000.
Answer:
(a) 62%
(b) 3.83 times
(c) Yes
Explanation:
(a) Ellie's debt ratio:
= Total Debt ÷ Total assets
= $39 million ÷ $63 million
= 0.62 or 62%
(b) Ellie's times interest earned ratio:
= Interest ÷ EBIT
= $23 million ÷ $6 million
= 3.83 times
(c) Yes, it has enough times interest ratio.
If Interest expenses increased to $7 Million, then
Company could easily raise more debt to finance additional funding needs.
Answer:
The correct answer is letter "C": Confirmation of cash should only be performed as of the balance statement date because the auditor expresses an opinion as of that date.
Explanation:
Confirmation of cash is an audit procedure in which specialists request the company to get in touch with its banker to verify the organization's balance. The procedure is not based only on the balance statement but according to the transactions the company has carried out regardless of the date.
According to liquidity preference theory, there is a rightward shift in the money supply curve when the federal reserve decides to raise the money supply.
Option A is the correct answer.
<h3>What is a federal reserve?</h3>
The federal reserve is the central banking authority in America which was established in the year 1913 under the Federal Reserve Act.
When the federal reserves increase the money supply then the money supply curve moves in the right direction and when the federal reserve decreases the money supply then the money supply moves toward the left. This shows a direct relationship between the federal reserve and the money supply curve.
Therefore, there is a rise in money supply by the Federal reserve causing the money supply curve to shift in the right direction.
Learn more about the rise in money supply in the related link:
brainly.com/question/26000265
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