Answer:
Debiting Interest Receivable for $400 and crediting Interest Revenue for $400
Explanation:
Based on the information given if the company.has a note receivable from Jewel Co for the amount of $80,000 in which The note matures in 5 years and bears interest of 6% which means that when Rose is preparing financial statements for the month of June. Rose should make an adjusting entry by :
Debiting Interest Receivable for $400
crediting Interest Revenue for $400
[($80,000 × .06)/12 ]
Option D , 15,100
Solution:
The formula for net income is calculated through total expenditures subtracted from total revenues.
Net Income = Service Revenue - Salary Expense - Repairs Expense - Supplies Expense - Gasoline expense
= $22,800-$4,500-$800-$1,600-$800
= $15,100
Net Income = $15,100
Answer:
The correct answer is B. The use of collateral makes it more costly for borrowers to take advantage of their asymmetric information.
Explanation:
In finance, a collateral or guarantee is a transferable asset or a surety, or even a promise of guarantee, used to cover the credit risk during financial transactions in the event that the borrower cannot meet his payment obligations.
A secured loan means a loan in which the borrower commits certain assets as a guarantee of credit, this the latter then becoming a partially secured debt for the creditor who made this loan.
The guarantee may consist of cash (pledge of cash account in retail bank, cash-collateral in investment bank) or securities.
Another form consists of a simple commitment: commitment by signature of a bank towards its client, promise of collateral or mortgage, letter of intent.
