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anastassius [24]
3 years ago
15

Kier Company issued $660,000 in bonds on January 1, Year 1. The bonds were issued at face value and carried a 5-year term to mat

urity. The bonds have a 6.00% stated rate of interest and interest is payable in cash on December 31 each year. Based on this information alone, what are the amounts of interest expense and cash flows from operating activities, respectively, that will be reported in the financial statements for the year ending December 31, Year 1?
Business
1 answer:
yuradex [85]3 years ago
3 0

Answer:

Interest Expense $39,600

Cash Flow from Operating Activities $39,600

Explanation:

Payment of Interest Expense is the cash expense paid during the year which is deducted from the operating profit in the calculation of net income which is used to determine the cash flow from operating activities.

Interest on the Bond = $660,000 x 6% = $39,600

At the time of payment Journal Entry will be as follow

Dr. Interest Expense   $39,600

Cr. Cash                       $39,600

As the cash is paid against the operating activities.

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You own a portfolio that has a total value of $215,000 and it is invested in Stock D with a beta of .86 and Stock E with a beta
babunello [35]

Answer:  BP = BD(WD) + BE(WE)

                   1 = 0.86(1-WE) + 1.39WE

                   1 = 0.86-0.86WE + 1.39WE

                   1 = 0.86 + 0.53WE

                 -0.53WE = -0.14

                  0.53WE  = 0.14

                         WE   = 0.14/0.53

                         WE   = 0.2641509434

                         WD = 1 - WE

                         WD = 1 - 0.2641509434

                         WD = 0.7358490566

The dollar amount of investment in stock D = 0.7358490566 x $215,000

                                                                         = $158,207.54

Explanation: The beta of the portfolio is 1, which corresponds to the beta of the market. The beta of the portfolio equals beta of each stock multiplied by the percentage of fund invested in each stock(weight). The weight of stock D is equal to 1 - weight of stock E. Therefore, we need to make weight of stock E the subject of the formula by solving the problem mathematically and collecting the like terms. The weight of stock E is 0.2641509434. The weight of stock E will be subtracted from 1 so as to obtain the weight of stock D, which is 0.7358490566. The dollar amount of stock D equal to $215,000 multiplied by 0.7358490566, which is $158,207.54.

4 0
3 years ago
When is VAT added to a product’s price?
Sophie [7]

VAT added to the products price at the stage of sale.

Answer: Option B

<u>Explanation:</u>

VAT stands for value added tax. VAT system is like a GST. The VAT has to be paid by the consumer or a business concern must pay the cost of goods and services and has to be subtracted material cost of previous year if any.

At the exact and each time value is added when a sale is made. Each and every seller in the production chain as to be charges VAT tax to the buyer, which it's remitted to the government.

3 0
3 years ago
Ricardo buys a coffee maker as a gift for his sister. The product turns out to be defective. Ricardo knows that he can complain
Natali5045456 [20]

Answer:

the entire supply chain (hope this helps) pls i need one more brainly to rank up

4 0
3 years ago
Mark wants to be a web designer. He recently found out that a local company is
ExtremeBDS [4]

Answer:

No his parents aren't exactly right, a college is far more expensive, not only money wise, but also time wise. These programs/bootcamps can get you started in web design, and make sure you pass with a certificate and fully understand the topic, and they only take around a 2 - 5 months.

6 0
3 years ago
Present and Future Values for Different Periods:
DiKsa [7]

Answer:

1. $636

2. $674.16

3. $566.04

4. $534

Explanation:

PV = FV ÷ (1 + r/n)^(t × n)........(1)

PV = present value

FV = Future value

r = rate per period

t = number of years

n = number of compounded period per year

FV = P(1 + r/n)^(t×n)...............(2)

FV = Future value

P = principal

r = rate per period

n = number compounded period per year

t = number of year

NO 1.

P= $600

t = 1

n = 1

r = 6% = 0.06

Using equation 2

FV = 600(1 + 0.06/1)^(1 × 1) = $636

NO 2

P = $600

n = 1

t = 2

r = 0.06

Using equation 2

FV = 600(1 + 0.06/1)^(2 × 1) = $674.16

NO 3.

FV = $600

r = 0.06

t = 1

n = 1

Using equation 1

PV = 600 ÷ (1 + 0.06/1)^(1 × 1) = $566.04

NO 4.

FV = $600

r = 0.06

n = 1

t = 2

Using equation 1

PV = 600 ÷ (1 + 0.06/1)^(2 × 1) = $534

8 0
3 years ago
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