No, there is not any requirement of recording when the fair value of bonds decreases to $6000000 on December 31 of the current year.
Given that Starbucks purchased bonds with $ 7 million face value at par for cash on July 1 of the current year and the bonds pay 7 percent interest the following June 30 and December 31 and mature in three years.
We are required to tell whether there is requirement of any recording when the fair value of bonds decreases to $6000000 on December 31 of the current year.
A bond is basically a debt security, similar to an IOU and borrowers issue bonds to raise money from investors willing to lend them money for a certain amount of time. When we buy a bond, we are lending to the issuer, which may be a government, municipality, or corporation.
There is not any requirement of any recording when the fair value decreases to $600000 because it is not affecting our books of accounts because in our books they are recorded at face values.
Hence there is not any requirement of recording when the fair value of bonds decreases to $6000000 on December 31 of the current year.
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Answer:
Wholistic Health Services Co.
Income Statement for the year end February 28, 2019
Service Revenue $270,900
Less: Supplies Expense <u>$3,000 </u>
Gross Income $267,900
Less operating Expenses:
Insurance Expense $4,000
Depreciation Expense $9,000
Miscellaneous Expense $6,000
Utilities Expense $1,760
Rent Expense $4,200
Wages Expense <u>$213,000</u>
<u>$237,960</u>
Net Income <u>$29,940 </u>
Explanation:
Income statement shows the performance of the company in a year. It provides the details of revenue, expenses and profits for the year. All the expenses are deducted from the revenue to determine the net earning of the business.
Answer:
The firm's unleveraged beta is 1.0251
Explanation:
Hamada's equation is used to separate the financial risk of a levered firm from its business risk.
The Hamada equation:
Bu= Bl/(1 + (1 − T)(D/E))
Bl = 1.4
wd = 0.36
Tax rate = 35%
D/E = wd / (1 – wd) = 0.5625 = 56.25%
= 1.4/ (1+(1-0.35)(0.5625))
=1.4/ 1 + (0.65)(0.5625)
=1.4/1.36
= 1.0251
Answer:
It's true I think if I'm wrong do tell me.
