Answer:
Dr Cash $427,200
Dr Discount on Bonds payable $17,800
Cr Bondss payable $445,000
Explanation:
Preparation of the journal entry to record the sale of these bonds on January 1, 2022
Dr Cash $427,200
($445,000 × 0.96)
Dr Discount on Bonds payable $17,800
($445,000-$427,200)
Cr Bonds payable $445,000
(Being to record the sale of the bond )
The three main forms of legal ownership of a business is Coporation, Partnership, and Sole proprietorship
Answer:
a. $33,000
b. $36,000
Explanation:
The computation is shown below:
a. Cash basis net income
= Collection from customers - expenses paid
= $105,000 - $72,000
= $33,000
b. Accrual basis net income
= Service performed - expenses incurred
where,
Service performed is
= $105,000 - $25,000 + $40,000
= $120,000
And, the expenses incurred is
= $72,000 - $30,000 + $42,000
= $84,000
So, the net income under accrual basis is
= $120,000 - $84,000
= $36,000
Answer:
Yes, it can be asserted that willingness to pay under these circumstances can be reconciled with the profit goal of a business in a free enterprise system.
Explanation:
There are three possible implications of the oversight of the subcontractor to submit a bill as follows:
1. The subcontractor may not have forgotten to submit the bill but the small business owner pays $15,000: Under this, the fact that the subcontractor has not submitted the bill does mean he has actually forgotten the legal obligation of the small business to pay. If the small company does try to fall through, it can raise suspicions the small business.
2. The subcontractor may truly have forgotten to submit the bill and the small business owner pays $15,000: Under this case, a feeling of an obligation to pay $15,000 will create a great and positive impression on the part of the subcontractor about the small business owner. This will subsequently result in a further favourable business interactions between the small business owner and the subcontractor.
3. The subcontractor may truly have forgotten to submit the bill and does pay any amount: Under this case, the subcontractor will have a wrong impression about the small business owner when the subcontractor eventually remembers he is yet to submit the bill. The attendant negative results will be loss of integrity, loss of more future business opportunities, and among others.
Conclusion
From the explanation above, it can therefore be asserted that willingness to pay under these circumstances can be reconciled with the profit goal of a business in a free enterprise system. This is because by doing the right thing, more positive impression will be created over time.