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3 years ago

Amortizing a bond discount: Multiple Choice Decreases

Business

1 answer:

Nutka1998 [239]3 years ago

6 0

Answer:

Allocates a portion of the total discount to interest expense each interest period.

Explanation:

First, we understand that once a bond is issued at a discount, the first implication is the existence of a debit figure representing the discount on the bond issued.

However, the treatment of this discount figure is this:

First, the difference between the interest based on the effective interest rate of the carrying value of the bond and the interest based on the coupon rate on the face value of the bond is calculated. Once calculated, the discount figure is then amortized to the value of the difference between the two interest figures.

As such, amortizing discount on bonds affects the interest expense each interest period.

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When the government levies taxes to subsidize the producers of corn-based sugar, the subsidies will?

Andreas93 [3]

I would say the subsidies for corn-based sugar will result in more of that sugar being produced and therefore sales should increase and the government should benefit by more tax revenue in the long run to offset the cost of the subsidies.

4 0

2 years ago

Which statement about globalization is true? a. It has led to more quotas on trade around the world. b. It is a purely economic

Lera25 [3.4K]

Answer:

c. It has been fueled by trade, immigration and foreign investment

Explanation:

Globalization refers to integration of domestic economy with respect to the world economy.

Import quotas refers to the duties and taxes imposed on the imported goods.

The concept of Globalization has witnessed drastic rise over the years owing to international trade, removal of pre-existing trade barriers, immigration of personnel and foreign investment which has seen a rapid rise in multi national corporation growth around the world.

Thus, Globalization has been driven by trade, immigration and foreign investment.

4 0

3 years ago

The strong form of the efficient market hypothesis contends thatA) a select few institutional investors can earn abnormal profit

Anni [7]

Answer: Option D

Explanation: Strong form efficiency is the most stringent form of market efficiency. This hypothesis states that the securities in the market reflects all the information in their price whether public or private.

Therefore, any investor would not be able to earn abnormal returns no matter how much research he or she has done. As the securities reflects private information also, therefore, insider trading will also be useless.

Hence from the above we can conclude that the correct option is D.

5 0

3 years ago

Determine the amount of money in a savings account at the end of 3 years, given an initial deposit of $9,000 and an annual inter

natima [27]

Answer:

The correct answer for option (a) is $10,124, option (b) is $10,135 and option (c) is $10,141.

Explanation:

According to the scenario, the given data are as follows:

Initial amount (p) = $9,000

Annual interest rate (r1)= 4%

Semi annual interest rate (r2) = 4% / 2 = 2%

Quarterly interest rate (r3) = 4% / 4 = 1%

Time period ( annual) (n1)= 3 years = 3

Time period ( semi-annual) (n2) = 3 × 2 = 6

Time period ( quarterly) (n3) = 3 × 4 = 12

So, we can calculate future value by using following formula:

A= P ( 1 +r)^n

(a). Putting the value in the formula

A= P ( 1 +r1 )^n1

= $9,000 ( 1 + 4%)^3

= $9,000 x (1.04)^3

= $10,124

(b). Putting the value in the formula

A= P ( 1 +r2 )^n2

= $9,000 ( 1 + 2%)^6

= $9,000 x (1.02)^6

= $10,135

(c.) Putting the value in the formula

A= P ( 1 +r3 )^n3

= $9,000 ( 1 + 1%)^12

= $9,000 x (1.01)^12

= $10,141

4 0

3 years ago

All of the following statements are correct when referring to process costing except:Multiple ChoiceCosts are accumulated by dep

mr_godi [17]

Answer:

Process costing would be appropriate for a jeweler who makes custom jewelry to order.

Explanation:

Product costing is defined as the process by which the best costing method is chosen to suit a particular product.

There are three main types: process costing, specific order costing, and service costing.

Process costing is a method that determines the cost incurred at each stage of production. It is best used for processes that are repetitive such as manufacturing plants.

However a jeweler who makes custom jewelry to order will most appropriately be served by a specific order costing.

This involves costing according to distinct jobs or contracts.

There is no specific or repetitive process, rather the job is usually carried out according to specific needs of a customer.

6 0

3 years ago