Section 8 does not require you to pay them back
The net present value would be zero.
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Answer:
a) $72,000
b) $90,000
c) $90,000
Explanation:
As per the data given in the question,
a) By using variable costing We can calculate the Total cost of finished goods inventory as follows:
= 3,000 units ×($9+$10+$5)
= $72,000
b) By using absorption costing the total cost of finished goods inventory can be calculated as follows:
= 3,000 units ×[ ($9+$10+$5)+($150,000÷25,000)]
= $90,000
c) 3,000 units should be carried in the inventory for external purposes at
= $90,000
Answer:
Sean can not either realize the bond as the loss as business bad debt or as a worthless security.
Explanation:
- Whether Sean can take the bond as the loss as business bad debt? Sean can't take the bond as the loss as business bad debt because the bond is a security whose value is dropping because of various risks such as market risks, credit risks. There is no certain information given the bonds are going to be default.
- Whether Sean can take the bond as the loss as worthless security? Sean can't take the bond as the loss as worthless security because the security is still worthy ($50,000 each). Loss, in this case, is only realized when bonds is sold or completely worthless.