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MissTica
3 years ago
5

Leaf Co. purchased from Oak Co. a $20,000, 8%, 5-year note that required five equal annual year-end payments of $5,009. The note

was discounted to yield a 9% rate to Leaf. At the date of purchase, Leaf recorded the note at its present value of $19,485. What should be the total interest revenue earned by Leaf over the life of this note?
a. $5,045
b. $5,560
c. $8,000
d. $9,000
Business
1 answer:
Veronika [31]3 years ago
4 0

Answer:

b. $5,560

Explanation:

The computation of the total interest revenue is shown below:

The five equal annual year-end payments = $5,009

For five years, the total amount is

= $5,009 × 5 years

= $25,045

And, the present value of recording the note is $19,485

So, the  total interest revenue earned would be

= Five years amount - present value of recording the note

= $25,045 - $19,485

= $5,560

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8 0
3 years ago
Three categories of activities (operating, investing, and financing) generate or use the cash flow in a company. In the followin
Marat540 [252]

Answer:

a. Yum Co. uses cash to repurchase 10% of its common stock. (Financing activity)

b. DigiInk Printing Co. buys new machinery to ramp up its production capacity. (Investing activity)

c. D and W Co. sells its last season’s inventory to a discount store. (Operating activity)

d. A company records a loss of $70,000 on the sale of its outdated inventory. (Operating activity)

Explanation:

Cash flow statement shows how cash is used and obtained in a business. There are different activities that influence cash flow. Below are the activities:

- Operating activities are those that include normal business operations like buying and selling of inventory, interest payments, and salaries.

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- Financing activities includes cash used to purchase or sell equity such as shares, payment of dividends, and repayment of principal from debt

3 0
3 years ago
Each of the following would increase the demand for U.S. dollars, shifting the demand curve for dollars to theright, except:
earnstyle [38]

Answer:

<h2>The answer to the given question would be option C. or an increase in the real interest rate on U.S. assets.</h2>

Explanation:

  • An increase in the real interest rate on US financial assets basically imply a higher financial cost of borrowings of these assets which would consequently reduce the demand for US assets among foreign investors or borrowers.
  • As the real interest rate on US assets goes up,the foreign investor have to pay more as interest on any borrowing of the US assets in US dollars.Therefore,the periodic interest payments in terms of US dollars also increases for the foreign or international financial investors which will eventually reduce the demand for US dollars in the foreign exchange market for US dollars.
  • As a result of such occurrence,the demand curve for US dollars would shift leftward or downward thereby reducing the currency value of US dollars relative to other foreign or international currencies.
6 0
3 years ago
Charity Hospital is holding its annual gala in a fancy downtown hotel. Tickets are $200 each, and the organization estimates tha
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Based on the amount paid for the tickets and their fair value, the portion that is entitled to <u>charitable contribution deduction</u> is $75.

When one buys a ticket to a charitable event, there is a chance that some of the ticket price can be treated as a charitable contribution deduction.

The part that can be treated as such is anything in excess of the fair value of the ticket. This amount in this case is:

= 200 - 125

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In conclusion, the answer is $75.

Find out more on <u>charitable contribution deductions</u> at brainly.com/question/8706786.

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3 years ago
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