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sergij07 [2.7K]
2 years ago
14

On January 1 of the current year, Jimmy's Sandwich Company, Inc. reported stockholders' equity totaling $122,500. During the cur

rent year, total revenues were $96,000 while total expenses were $85,500. Also, during the current year the business paid $20,000 to the stockholders. No other changes in equity occurred during the year. If, on December 31 of the current year, total assets are $196,000, the change in stockholders' equity during the year was:_________
a) A decrease of $9,500.
b) An increase of $9,500.
c) An increase of $30,500.
d) A decrease of $30,500.
e) An increase of 73,500.
Business
1 answer:
Alex Ar [27]2 years ago
6 0

A.nswer:

a) A decrease of $9,500.

Explanation:

Calculation for the change in total stockholders' equity

Using this formula

Change in total stockholders' equity = Total Revenues amount - Total Expenses amount - Dividends amount

Let plug in the formula

Change in total stockholders' equity =$96,000 - $85,500 - $20,000

Change in total stockholders' equity = Decrease of $9,500

Therefore the change in total stockholders' equity during the year was: a decrease of $9,500

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Crane Company produces two models: Model 24 has sales of 300 units with a contribution margin of $40 each; Model 26 has sales of
pantera1 [17]

Answer:

Effect on income= 50*50= $2,500 increase

Explanation:

Giving the following information:

Model 26 has sales of 150 units with a contribution margin of $50 each.

To calculate the effect on income, we need to use the following formula:

Effect on income= number of units*unitary contribution margin

Effect on income= 50*50= $2,500 increase

3 0
2 years ago
A 30-year maturity bond has a 6.7% coupon rate, paid annually. It sells today for $881.17. A 20-year maturity bond has a 6.2% co
geniusboy [140]

Answer:

Rate of return

30 year bond =  42%

20 year bond = 45%

Explanation:

First of all find current yield on 30 year maturity bond

We will use PV of annuity formula to calculate current YTM

Coupon Payment = 6.7% x 1000 = $67

$881.17 =( $67( 1- ( 1 + r )^-30 ) / r ) + ( 1000 / ( 1 + r )^30 )

r = 0.0773 = 7.73%

Current YTM is 7.73%

Now calculate the current yield for 20 years maturity bond

Coupon Payment = 6.2% x 1000 = $62

893.1 = ( ( $62 x ( 1 - ( 1 + r )^-20 ) / r ) + ( 1000 / ( 1 + r )^20 )

r = 0.0723 = 7.23%

As given

5 years from now the YTM on 30 Year bond will be 7.70% and on 20 Year bond will be 7.20%.

Now calculate

Price of the 30 year bond Bond after 5 year at YTM of 7.7%

Price of the Bond = ( $67 x ( 1 - ( 1 + 0.077 )^-(30-5) ) / 0.077 )+( 1000 / ( 1 + 0.077 )^(30-5) ) = $890.46

Price of the 20 year bond Bond after 5 year at YTM of 7.2%

Price of the Bond = ((6.7%*1000)*(1-(1+0.072)^-15)/0.072)+(1000/(1+0.072)^15)

( $62 x ( 1 - ( 1 + 0.072 )^-(20-5) ) / 0.072 )+( 1000 / ( 1 + 0.072 )^(20-5) ) = $910.06

Increase in price of 30 year bond = $890.46 - $881.17 = $9.29

Increase in price of 30 year bond = $910.06 - $893.1 = $16.96

Future value of Coupon payment for 5 years

30 year bond = 67 x ( 1.072^5 -1 ) / 0.072 = $386.84

20 year bond = 62 x ( 1.072^5 -1 ) / 0.072 = $357.97

Total return = FV of Coupon payment + Price increase

30 year bond = $386.84 + $9.29 = $396.13

20 year bond = $357.97 + $16.96 = $374.93

Rate of return =  

30 year bond = $396.13 / $881.17 = 0.45 = 45%

20 year bond = $374.93 / $893.1 = 0.42 = 42%

5 0
3 years ago
On September 3, 2018, Able, a single individual, purchased § 1244 stock in Red Corporation from his friend Al for $60,000. On De
klio [65]

He should ask them why it was worthless then after a while of thinking maybe have and idea on how to use it again

8 0
3 years ago
Sentence or a short
Kaylis [27]

Look at the very last page (page 2) of this pdf, does it help?

https://www.monmouth.edu/resources-for-writers/documents/bluebook-explanatory-parentheticals.pdf/

4 0
2 years ago
On January 1, 2016, Skyward Company purchased a copy machine. The machine costs $320,000, its estimated useful life is 8 years,
never [62]

Answer:

$60,000

Explanation:

Double declining method is a depreciation method used to expense the cost of an asset.

Depreciation expense using the double declining method = Depreciation factor × cost of asset

Deprecation factor = 2 (1/useful life) = 2(1/8) = 1/4

Depreciation expense in 2016 = 0.25 × $320,000 = $80,000

Net book value = $320,000, - $80,000 = $240,000

Deprecation expense in 2017 = 0.25 x $240,000 = $60,000

I hope my answer helps you

3 0
3 years ago
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