Answer:
There will be no effect on working capital upon write off as the entries required would be a credit to receivables and a debit to allowance account.
Explanation:
The allowance account is the account used to record receivables due that may not be collectible.
When a company has determined that a receivable may be uncollectible, the company credits the allowance for receivables account and debits bad debit expense. This reduces the accounts receivable balance in the balance sheet as the receivables to be reported will be net the allowance given. As such, where on December 31, 2020, Allowance account balance includes $3,076 for a past due account that is not likely to be collected.
There will be no effect on working capital upon write off as the entries required would be a credit to receivables and a debit to allowance account.
The instrument that Shawn must use is “payable to the order of” before the name of the payee.
<h3>Requirements of Negotiability </h3>
- The first of the four major considerations is whether or not a paper is negotiable, and it is one that nonlawyers must address.
- Auditors, retailers, and financial institutions frequently handle notes and checks and must make quick decisions about negotiability.
- In a negotiable instrument, the only permissible promise or direction is to pay a particular sum of money. Any other promise or command renders negotiability null and void
- This restriction exists to prohibit an instrument from having an uncertain value.
- If the bearer of a negotiable instrument had to examine whether a provision or condition had been met before the thing had any value, the utility of the object as a substitute for money would be severely diminished.
Hence, the instrument that Shawn must use is “payable to the order of” before the name of the payee.
To learn more about the Negotiation instrument refer to:
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Answer:
Final value= $2,282.013
Explanation:
Giving the following information:
Erick is planning to invest $500 at the end of year one, 800 at the end of year two, and 900 at the end of year three at 4.5 percent interest.
To calculate the total final value of the investment, we need to use the following formula for each deposit:
FV= PV*(1+i)^n
Deposit 1= 500*1.045^2= 546.013
Deposit 2= 800*1.045= 836
Deposit 3= 900
Final value= $2,282.013
Answer:
She is unfamiliar with the <u>"mere exposure effect."</u>
Explanation:
When an individual hear or see something many times, he/she develops a preference for that thing merely, the reason is that an individual is so much familiar with that, this phenomenon is known as mere-exposure effect. Sometimes we also develop that effect when we watch any tv program so many times that we develop much familiarity with that program.
Answer:
$556063.77 is the balloon payment in order to finish the loan in 8 years.
Explanation:
Firstly we will use the Present value formula annuity to find how much will we pay on a monthly basis for the 30 year mortgage loan so we are given :
Pv the present value of the mortgage is $1800000
i which is the interest rate 7.8%/12 as there will be monthly payments
is the number of payments which are 30 x 12 = 360 payments
then we substitute on the formula Pv= C[(1-(1+i)^-n) /i]
we are looking for C the monthly payments
$1800000= C[(1-(1+(7.8%/12))^-360)/(7.8%/12)] now divide by the coefficient of C both sides to solve for C
$1800000/[(1-(1+(7.8%/12))^-360)/(7.8%/12)] = C
$12957.66= C
now if the monthly payment is $12957.66 we will find how much we will pay in 8 years which will be $12957.66 x 12 x 8 = $1 243 936.23 now if this amount is covered for 8 years then the balloon payment is $1800000 - $1243936.23 = $ 556063.77 which is the remaining amount in present value terms, this is the balloon payment to finish the mortgage in 8 years.
