They are referred to as installment notes
Answer:
1 Jan 2021- Debit Investment $220 million, Credit Bank $201 million, Credit Discount received $19 million.
30 June 2021 Debit Bank $8,800,000 Credit Interest income $8,800,000
31 December Debit Bank $8,800,000 Credit Interest income $8,800,000
31 December 2021 Debit Fair value loss $10 million, Credit Investment $10 million.
Explanation:
Required: prepare journal entries.
interest income = 220 million *0.08 *6/12= $8,800,000
fair value gain or loss = opening fair value - fair value at the end of the year
= 220 million - 210 million
= $10 million
When the local currency falls in value, imports become more expensive, causing locals to purchase fewer imported goods. Exports, on the other hand, are less expensive to international buyers, so their demand rises. Fewer imports and more exports will reduce the trade deficit and may even result in a surplus.
<h3>What is
trade deficit?</h3>
The difference in the monetary value of a country's exports and imports over a given time period is known as the balance of trade, commercial balance, or net exports. A distinction is sometimes made between a trade balance for goods and one for services.
The net-export effect works as follows: A higher price level raises the relative cost of domestic exports to other countries while lowering the relative cost of foreign imports from other countries. As a result, exports fall while imports rise, resulting in a drop in net exports.
The net export variable is critical in calculating a country's GDP. A trade surplus boosts the country's GDP.
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