Answer:
Option A. Take a loan from Big Bank at 10.0% and save the money in Bank Enn at 10.5%.
Explanation:
Take a loan from Big Bank and deposit in Bank Enn. This activity can lead to a profit of 0.5% on the amount.
Assuming you take a Loan of $3000 from Big Bank at 10% interest rate. Present cash in hand is $3000 and the interest to be paid will be 10% of $3000 which is $300 every period.
If you deposit this amount with Bank Enn who pays an interest of 10.5%. You will receive $315 (10.5% of $3000) every period.
Doing this, you have a gain of $15 by the gap in the interest rates.
Compounding is the process whereby interest is credited to an existing principal amount as well as to interest already paid. Compounding thus can be construed as interest on interest the effect of which is to magnify returns to interest over time, the so-called miracle of compounding.
The annual interest rate refers to the rate that is applied over a period of one year. Interest rates can be applied over different periods, such as monthly, quarterly, or bi-annually. However, in most cases, interest rates are annualized.
Monthly interest rate=2/12=0.1666%
So total deposit required=Amount/interest
=19/0.1666%
=19/0.00166
=11445
So option B is the correct statement
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Answer:
- Divorce after 2020 = Alimony is $0
- Divorce before 2020 = Alimony is $12,000
Explanation:
If the divorce occurred before 2020 then the spouse paying the alimony can deduct it from their taxes and the person receiving it has to include it in their income. If the divorce of Jake and his spouse was before 2020, he will be able to include the full $12,000 as a deduction.
In 2020, new regulation came into effect that meant that couples divorcing from thence will not be able to deduct alimony so Jake's deduction would be $0 if they divorced in 2020 and onwards.
Answer: Please see the analysis below
Explanation: The following are the financial statement effects
Assets Liabilities Stockholders Equity Income Expense
Write-off of $10,000 - - Nil Nil Nil
Bad debt of $8,000 - + - - +
- Write-off of customer balances of $10,000 would lead to reduction in assets and also reduction in liabilities (since the provision for doubtful accounts reports to liabilities but mapped to the accounts receivable to show the net amount). Here, we have assumed that there is an existing allowance for doubtful accounts that has $10,000 buffer or more. If the write-off was not initially provided for, it would hit expense by debiting bad debt expense and crediting the accounts receivable. <em>Its effects are therefore decrease in asset, decrease in liabilities.</em>
- Bad debt expense of $8,000 affects the expense and the liabilities/assets. Journal entries to record the bad debt expense is Debit Bad debt expense $8,000; Credit Allowance for doubtful accounts $8,000. So, it affects the expense, liabilities and ultimately the assets (allowance for doubtful accounts is a contra to the accounts receivable). <em>Its effects are increase in expense, increase in liabilities, decrease in stockholders equity, decrease in income and decrease in assets</em>
Answer:
Even though the mistake was unilaterally made by Jeff, it was obvious for the company that a mistake had been made. All the other offers were over $30,000, so there is no reasonable way that Jeff's offer could be so low. Jeff's arguments would prevail in court.