Answer:
Covered Interest Arbitrage
Explanation:
The Covered Interest Arbitrage is a term that refers to arbitrage trading approach in which a stockholder take the chance to gain advantage from the disparity in interest rate between two nations.
The trading strategy helps in its verifiability, quantifiability, consistency, and objectivity
It is designed to profit the investor from the differences in interest rates between two countries, when buying and selling foreign currencies.
When a market is small or there's a high level of competition, there's a possibility that the earnings on covered interest rate arbitrage won't yield much.
If it costs $5.10 to get $4.10 from Friendly's then the loanee would pay about 24% which is a pretty high interest rate and presumably the interest rate would decrease with a higher amount loaned as on a larger amount the actual amount of interest earned would still be significant with a lower interest rate.
Answer: Form utility
Explanation:
Utility is the satisfaction consumers derive from the use or consumption. Form utility is used to explain how well a particular product or service meets the needs of the customer. Form utility incorporates the needs and wants of consumers into the benefits and features of the products that is offered by the company.
Companies invest money and time into the research of product research in order to know the kind of products or services that consumers desire. The firm utility is the method of used by IBM.
Answer:
Debit Advertising expense $916.67
Credit Prepaid Advertising $916.67
Being entries to recognize advertising expense incurred for 5 months.
Explanation:
When an amount is paid in advance, the entries posted are
Debit Prepaid Advertising
Credit Cash account (with the amount prepaid)
As the expense is incurred, entries required would be
Debit Advertising expense
Credit Prepaid Advertising (with the amount incurred)
Expense incurred in 5 months
= 5/6 × $1100
= $916.67
Hence the entries required will be
Debit Advertising expense $916.67
Credit Prepaid Advertising $916.67
Being entries to recognize advertising expense incurred for 5 months.
Answer:
The borrower records its receipt of cash and new liability with this entry
Jan 1 Notes Receivable $10,000 Dr.
Sales / Accounts Receivable $10,000 Cr.
Received Note of 3 months with 9% interest
The entry would credit to Sales if it is received against sales or credit to account receivable isf it is received against accounts receivable for a further time period as the case may be.
