Answer:
When the company gets cash from a bank loan,
Cash Debits
Bank Loan Account Credits
what happens is that the Assets increase and the Liabilities also increase.
Explanation:
<span>full scale operating model of the product!!!</span>
Answer:
A. 5.42%
B. 3.52%
Explanation:
A. Calculation for the companys pretax cost of debt
Using this formula
Pretax cost of debt= [Coupon payment +(Face value - price/Number of years)]/[(Face value - price)/2]
Let plug in the formula
Pretax cost of debt = (6%+((100%-107%)/18 years))/((100%+107%)/2)
Pretax cost of debt = 5.42%
Therefore the Pretax cost of debt will be 5.42%
B. Calculation for the aftertax cost of debt
After tax cost of debt = 5.42%*(1-35%)
After tax cost of debt = 5.42%*65%
After tax cost of debt = 3.52%
Therefore the After tax cost of debt will be 3.52%
Answer:
This indicates that
d.the company has a net loss of $9,575 for the period.
Explanation:
a) Data and Calculations:
Total debits of the balance sheet (assets) = $28,480
Total credits of the balance sheet (liabilities + equity) = $38,055
Difference (net loss) = $9,575 ($38,055 - $28,480)
b) With the determination of the net loss of $9,575, the two sides (debits and credits) of the balance sheet will equal. This is because the net loss of $9,575 will reduce the credits from $38,055 to $28,480.
