Answer:
1.Jan 01 Dr Cash 360,000
Cr Notes payable 340,000
2.Interest expense 28,800
Principal Reduction 61,364
Explanation:
MM Co.
1 . Journal entry
Since MM Co. borrows $360,000 cash on January 1 from a bank this means we have to
Debit Cash with the amounts of money he borrowed which is $360,000 and Credit Notes Payable with the same amount.
Jan 01 Dr Cash 360,000
Cr Notes payable 340,000
2. Calculation of the amount goes toward interest expense and Principal reduction
Interest expense 28,800
(360,000*8%)
Principal Reduction 61,364
(90,164-28,800)
Answer:
Present value of future cash inflows of Project Y = $110,000 X 3.240 = $356,400
Explanation:
Provided cost of Proposal Y = $512,000
Residual Value = $0
Depreciation will not be considered as we need to consider the present value of future cash flows, depreciation does not involve any cash flow.
Useful life = 4 years
Estimated cash inflow per year = $110,000
Discount rate = 9%
Present Value of an Ordinary Annuity = 3.240 @ 9% for 4 years
Thus present value of future cash inflows = $110,000 X 3.240 = $356,400
Note: Net Present Value = Present Value of Cash Inflows - Present Value of Cash Outflow = $356,400 - $512,000 = -$155,600
Final Answer
Present value of future cash inflows of Project Y = $110,000 X 3.240 = $356,400
Answer:
Maximum profit = $765,333.33
Explanation:
Note: See the attached excel file for the calculation of the maximum profit (in bold red color).
In the calculation, it is assumed that selling price per unit is the same thing as the profit per unit since we are not given the cost per unit.
Therefore, from the attached excel file, we have:
Maximum profit = $765,333.33
<span>Michael is in a dilemma whether to choose to buy a necessary textbook for $100 or take the road trip he wanted to take during summer, this principle illustrates that people face trade-offs. The both activities are competent and he have to find the balance in his thoughts and act on it which would be more of a compromise in this situation.</span>
Answer:
Loss= $30,000
Explanation:
<u>First, we need to calculate the annual depreciation and the accumulated depreciation at the moment of the sale:</u>
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (60,000 - 6,000) / 10
Annual depreciation= $5,400
Accumulated depreciation= 5,400*5= $27,000
<u>Now, the book value and loss from the sale:</u>
Book value= 60,000 - 27,000= $33,000
Loss= selling price - book value
Loss= 33,000 - 3,000
Loss= $30,000