Answer:
Reinvestment risk
Explanation:
The mortgage banker would be most concerned about reinvestment risk, among other risks. Reinvestment risk relates to the inability to earn an original interest rate on an investment from periodic cash flows from the investment, thus limiting the overall rate of return on the investment.
In the question, since market mortgage rate has declined to 7.5%, the mortgage bank would have to reinvest the amount repaid from the original borrower at the new market rate, which is 1% lower than the ruling rate when the original borrower took the loan.
The problem would be compounded if the cost of funding to the mortgage bank was, for instance 8%. If that was the case, on the original loan, the mortgage bank was earning a (8.5% less 8% cost of funding =) 0.5% on the loan. However, due to the decline in market rates, the mortgage bank would have a cost of 8% compare to a market rate of 7.5% it would earn, thus resulting in a negative return of 0.5%.
Answer:
D) $17,500 gain.
Explanation:
Wells Company should record the following transactions:
- Dr Cash account 40,000
-
Dr Accumulated Depreciation Vehicles account 47,500
- Cr Vehicle account 70,000
- Cr Gain on Disposal account 17,500
$40,000 in cash was received and the accumulated depreciation balance should equal to zero, therefore they must be debited.
The vehicles account balance should equal zero and the rest is gain on disposal, therefore they must be credited.
Answer:
Explanation:
Depends on the sample size.
Lots of people, median
Few probably neither is very helpful, but I'll pick the mean.
You need a single word answer? I'll pick median.
Answer:
A cheque, or check, is a document that orders a bank to pay a specific amount of money from a person's account to the person in whose name the cheque has been issued. The person writing the cheque, known as the drawer, has a transaction banking account where their money is held.
