The ______ is the amount returned to the investor at the maturity date when the bond is due.

The time value of money theory consists in four beliefs: (1) Investment risk is important; (2) money today is worth more than mo

Schach [20]

Answer:

The four beliefs are true. But accuracy is demanded

Explanation:

1 Investment risk is important ir order to estimate the likelihood of occurrance of losses in the future.

2. money today is worth more than the same amount of money tomorrow.

3. inflation must be considered when making investment decisions, because makes money lose their value in the future.

4. investment opportunity costs must be considered. Is necessary to compare investments with financial products or other commercial activities.

4 0

3 years ago

Mills Corporation acquired as a long-term investment $200 million of 7% bonds, dated July 1, on July 1, 2018. Company management

Evgen [1.6K]

Answer:

investment on bonds 200 millions

premium on bonds 40 millions

cash 240 millions

to record the purchase of bonds

cash 7 millions

interest revenue 6 millions

premium on bonds 1 million

interest proceeds of december 31th

Balance sheet:

bonds 200

premium 39

net 239

cash 250 millions

investment on bonds 200 millions

premium on bonds 39 millions

gain on sale of invesment 11 millions

to record the sale of bonds

Explanation:

recording the bonds:

acquisition 240

bonds face value (200)

premium 40

It is a premium, as the bonds where purchased at higher price than face value

Interest at December 31th

To calculate the interest, we will calcualte the interest per payment:

7% annual coupon rate /2 payment per year = 3.5% semi-annual rate

5% market rate /2 payment per year = 2.5% semi-annual market rate

cash proceeds: 200 x 3.5% = 7

interest revenue:

carrying value x market rate

240 x 2.5% = 6

amortization 7 - 6 = 1

Value in the balance sheet:

the net value of the bond will be the face value plus the carrying value of the premium

Sale of the bonds:

selling price 250

carrying value of the bonds (239)

gain on sale of bonds 1 1

It is a gain, as the bonds are being sold at a higher price than his carrying value.

7 0

3 years ago

Kitchen and Laundry and More has annual credit sales of $2,473,701 and cost of goods sold of $1,838,207. The average accounts re

Agata [3.3K]

Answer:

32.59 days

Explanation:

DSO = Average receivables / Sales Revenue X 365

= $56,736 / (2,473,701 - 1,838,207) x 365

= $56,736 / (635,494) x 365

= 32.59 days

3 0

2 years ago

The distribution of a percentage of a firm's profits among its employees is called?

igomit [66]

Employee Benefit refers to the division of a company's profits among its workers.

Employee perks, also known as fringe benefits, perquisites, or perks, refer to various forms of non-wage remuneration given to employees in addition to their regular earnings or salaries. Employee perks, particularly in British English, also refer to rewards in kind.

Salary packaging or salary exchange arrangements are situations where an employee trades in (cash) compensation for another type of perk. The majority of employee benefits are at least partially taxable in most nations. Housing (provided by the employer or paid for by the employer), furnished or not, with or without utilities free, group insurance (health, dental, life, etc.), disability income protection, retirement benefits, daycare, tuition reimbursement, sick leave, and paid vacation are some examples of these benefits.

Learn more about Employee Benefit here.

brainly.com/question/28163981

#SPJ1

6 0

2 years ago

If the Federal Reserve buys $8,500 worth of securities from non-bank public, and the non-bank public then keeps the payment from

vova2212 [387]

Answer:

c: C increases by $8,500 and the MB increases by $8,500

Explanation:

If the Federal Reserve buys $8,500 in securities from non-bank public and then payment is kept from the bank in form of cash, theC increases by $8,500 and the MB increases by $8,500

5 0

3 years ago