Explanation:
1. The journal entry is as follows:
On March 1
Prepaid insurance A/c Dr $36,000
To Cash A/c $36,000
(Being the prepaid insurance is recorded for cash)
For recording the advance purchase of insurance, we debited the prepaid insurance and credited the cash account. Both the accounts are recorded at $36,000 so that the proper posting could be done.
C) Mutual funds. They usually invest capital that has different origins (clients of an investment organization) to buy securities from different firms and create a profit from it.
Answer:
Capital risk.
Explanation:
Capital risk is defined as the potential to loose all or part of investment. This occurs with investments that do not give a guarantee of return of capital that is invested. The following investment options are prone to capital risk: shares, non government bonds, real estate, and other alternative assets.
The investor in this instance who purchased a put option and ended up losing the entire investment has lost as a result of capital risk.
Entrepreneurs and other producers accept risks because they hope to earn PROFIT.
Every businesses are set up for the purpose of earning profits. Every venture has its accompanying risks of failure but if everything goes right, then the pay-off will be worth it.
High risks business also have high potential of generating high profit.
Answer:
The missing question is "<em>Kruger offers an extended warranty that covers repairs for years 3 through 10. The price of the extended warranty is $3,000. Kruger estimates that it costs $2,500, on average, to provide the additional repairs required under the extended warranty.
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<em>Required: Assuming the customer chooses not to purchase the extended warranty, what journal entry(ies) should Kruger make at the time of the sale? Assuming the customer chooses to purchase the extended warranty, what journal entry(ies) should Kruger make at the time of the sale?"</em>
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Solution:
Date Account Titles Debit Credit
Cash $50,000
Sales revenue $50,000
Warranty expense $1,200
Warranty liability $1,200
Date Account Titles Debit Credit
Cash $53,000
Sales revenue $50,000
Unearned revenue $3,000
Warranty expense $1,200
Warranty liability $1,200
