Options :
A)net present value of the $25,000.
B)future value of the $25,000.
C)internal rate of the return on the $25,000.
D)present value of $25,000.
Answer: B)future value of the $25,000.
Explanation: The Smith's calculation and subsequent result which yielded $31,000 refers to the future value of $25,000. The initial $25000 is the present value of the amount held. If the initial amount is saved or deposited over a certain number of years in an account which yields a certain rate of interest per annum and is compounded either on a monthly, yearly, quarterly or semiannual basis as the case may be, in this scenario above, the interest is called mounded annually. This initial amount will grow and yield an amount which is greater than the present deposit. This is called the future value of the initial deposit.
Answer:
In times of economic downturns to stimulate growth
Explanation:
Open market operations are one of the monetary policies used by the Fed to regulate the money supply in the economy. They involve buying and selling treasury bills to the banks and other financial institutions. Open marker buys, and lowering of interests are expansionary policies used to stimulate economic growth.
By buying treasury bills, the Fed adds money to the banks. Banks exchange treasury bills for liquid cash. As a result, banks end up with excess money in their custody. To make profits, the bank lends out this money to firms and individuals at competitive rates. The availability of easy and low-interest credit encourages borrowing for investments and consumption. Increased economic activities accelerated economic growth. Lowering of discount rates makes loans cheaper, thereby encouraging borrowing.
Answer:
To determine the cash collection for February, you have to consider the sales on account form previous months.
Explanation:
To determine the cash collection for February, you have to consider the sales on account form previous months.
Cash Collection February:
Sales in cash= ($X*0.2)=
Sales on account:
From January= ($X*0.8)*0.5=
From December= ($X*0.8)*0.5=
Total cash=
Answer:
The answer is option B) probable and the amount cannot be reasonably estimated.
Explanation:
Contingency liability is the likelihood that a liability might occur sometimes in the future in the face of uncertain circumstances. To validate a contingency liability, the fa cts presented has to be reasonably possible and reasonably estimated.
in the case of Marcellus Company, footnote disclosure of the contingent liability which could arise does not have to be presented if the probability of Marcellus owing money as a result of the lawsuit is probable and the amount cannot be reasonably estimated.
Answer:
February 1,
DR Accounts receivable <u>5,000</u>
CR Sales <u>5,000
</u>
<em>(To record Credit Sale)</em>
Sales to be credited as sales are credited when they increase. Accounts Receivables are credited when they increase as well as they are Assets.