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3 years ago

Duration is e

Business

2 answers:

Shtirlitz [24]3 years ago

4 0

Answer:

B. the weighted average time to maturity of the bond's cash flows

Explanation:

$(\sum^n_{t=1} \frac{t \times C}{(1+i)^t}+\frac{n \times M}{(1+r)^n} ) /V$

t = time to maturity

r = required return

C = coupon payment

M = maturity

V = market value

Frm the duration formula we can notice there is a weighted average as there is a sum of the coupon payment which is latter divide over the bonds market value

Vadim26 [7]3 years ago

3 0

Answer:

The correct answer is letter "B": the weighted average time to maturity of the bond's cash flows.

Explanation:

Duration measures the exposure of a fixed-income to interest rate changes. Duration is a complex measure but it is standard knowledge supplied with mutual bonds and bond funds. Duration basically shows how long it will take for a fixed-income investment to repay the invested principal before interest payment is generated.

When it comes to bonds, duration would measure the time it takes for a bond to generate income out of the interest rate until the maturity date arrives.

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On April 1, Garcia Publishing Company received $24,480 from Otisco, Inc. for 36-month subscriptions to several different magazin

Aleks [24]

Answer: Debit Unearned fees $6,120, Credit Fees income $6,120.

Explanation: Garcia Publishing received $24,480 from Otisco on April 1 and this was recorded as unearned fees. This means Garcia would have debited cash with $24,480 and credited unearned fees $24,480. Remember the fees was paid at the beginning of April and is for 36-month subscriptions. So, the amount in unearned fees would be unwound to income (fees) over the tenor of the subscription (36 months). Therefore, monthly amortization would be $24,480 divided by 36 months = $680. April 1 to December 31 is 9 months, $680 multiplied by 9 months is $6,120.

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4 years ago

Joan owns a citrus tree farm near Mesa, Arizona. Joan and her family have fertilized the trees each spring for 52 years. The irr

koban [17]

Answer:

C. Joan can raise the defense that she did not knowingly discharge fertilizer into the waterway

Explanation:

8 0

4 years ago

How frequently is the value of insurers variable sub accounts normally calculated

Dennis_Churaev [7]

Answer:

Everyday because the ever-increasing complexity of our securities laws has led to a great deal of confusion among investors over the differences between mutual funds and variable annuity sub-accounts.

Explanation:

That's the answer.

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2 years ago

Johnson Superior Products Inc. produces hospital equipment and the setup requirements vary from product to product. Johnson prod

Oduvanchick [21]

Answer:

D) Johnson has failed to use the correct cost driver as the cost-allocation base for setup costs.

Explanation:

One of the main disadvantages of ABC costing method is that it is very hard and expensive to implement, and sometimes you cannot allocate all overhead costs to specific cost drivers. That is what happened here with Johnson's costing method, they combined two cost drivers and allocated resources using the number customer orders which is not a valid base, e.g. one single large order represents higher costs than 10 small orders.

ABC costing is not accepted by US GAAP due to its limitations or how hard it is to apply correctly, but it is a very useful information source for making decisions. The problem is, if gathering the information is worth the effort and extra cost of ABC?

8 0

4 years ago

The total factory overhead for Bardot Marine Company is budgeted for the year at $600,000, divided into four activities:

Gnesinka [82]

Answer:

Bardot Marine Company

a. Activity rates for each activity:

Fabrication = $40.80/dlh

Assembly = $26.25/dlh

Setup = $222.86/dlh

Inspection = $51.92/dlh

b. The activity based factory overhead per unit for each product:

Speed Bass

Boats Boats

Factory Overhead per unit $927.25 $1472.70

Explanation:

a) Data and Calculations:

Activities Budgeted Speed Bass

Overheads Boats Boats Total Activity rates

Fabrication $204,000 2,000 dlh 3,000 dlh 5,000 dlh $40.80/dlh

Assembly $105,000 1,000 dlh 3,000 dlh 4,000 dlh $26.25/dlh

Setup $156,000 300 dlh 400 dlh 700 dlh $222.86/dlh

Inspection $135,000 1,100 dlh 1,500 dlh 2,600 dlh $51.92/dlh

Total costs $600,000

Units budgeted 250 250 500 units

Speed Bass

Boats Boats

Fabrication = $40.80/dlh $81,600 $122,400

Assembly = $26.25/dlh 26,250 78,750

Setup = $222.86/dlh 66,850 89,144

Inspection = $51.92/dlh 57,112 77,880

Total assigned costs $231,812 $368,174

Units budgeted 250 250

Overhead per unit $927.25 $1472.70

5 0

3 years ago