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lbvjy [14]
3 years ago
8

On January 1, $1,000,000, 20-year, 8% bonds, were issued for $1,070,000. Interest is paid annually on January 1. If the issuing

corporation uses the straight-line method to amortize discounts and premiums on bonds payable, the annual amortization amount is
Business
1 answer:
Butoxors [25]3 years ago
5 0

Answer:

Annual Amortization expense = $76,500

Explanation:

In the given case the interest expense for the year will be $1,000,000 \times 8% = $80,000

Now, further the bonds are issued at a value more than face value, i.e. on premium of $1,070,000 - $1,000,000 = $70,000

Estimated life = 20 years

Therefore, per year premium amortization = $70,000/20 = $3,500 each year.

Thus annual amortization = $80,000 interest - Premium amortization $3,500

= $76,500.

In case if bonds are issued on discount then amortization is added to interest amortization as would increase the cost of company.

Final Answer

$76,500

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Maria Lorenzi owns an ice cream stand that she operates during the summer months in West Yellowstone, Montana. She is unsure how
ddd [48]

Answer:

1. $2,185

2. Percentage increase 14%. Sales decrease -22%

3. $1,805

4. -17.4%

Explanation:

1. In calculating the profit for the first week we will simply deduct the costs from the sales.

= Sales - Fixed Costs - Variable costs

= (1,800 cones * 3.5) - 2,675 - ( 1,800 cones * 0.8)

= 6,300 - 2,675 - 1,440

= $2,185

$2,185 is her profit for the first week.

2. Percentage increase in selling price will be,

= 4-3.5/3.5 * 100%

= 14%

Percentage decrease in sales

= 1,400 - 1,800 / 1,800 * 100%

= -22%

3. Using the first questions method we have,

= (1,400 * 4) - 2,675 - (1,400 * 0.8)

= 5,600 - 2,675 - 1,120

= $1,805

$1,805 is her profit for the second week.

4. Decrease in profit

= $1,805 - $2,185 / 2,185 * 100%

= -17.4%

Maria Lorenzi suffered a decrease in profit of -17.4% as a result of raising her prices by 14%.

7 0
3 years ago
In a long-run equilibrium,
Serga [27]

Answer: Option (d) is correct.

Explanation:

Correct option: Only a perfectly competitive firm operates at its efficient scale.

In the perfectly competitive market and in the long run, the firms who are making losses will exit the market and those firms who are able produce at a point where price is equal to the average total cost will exist in the market.

However, monopolistic firms operates at a below efficient level of production and with an excess capacity.

Competitive firms are generally enjoys the productive efficiency in the long run because these firms have the capability to produce at a lower average total cost.

8 0
3 years ago
Beech Soda, Inc. uses a perpetual inventory system. The company's beginning inventory of a particular product and its purchases
bagirrra123 [75]

Answer:

the cost of goods sold to be recorded at January 14 is: $230 .

Explanation:

LIFO (Last in First out) method, assumes that the last goods purchased are the <em>first ones</em> to be issued to the final customer.

This means that valuation of inventory will begin using the value of the <em>earliest</em> goods purchased.

The Cost of goods sold is calculated as follows :

Cost of goods sold : 9 units × $14 = $126

                                  13 units × $8 = $104

                                  Total              = $230

8 0
3 years ago
Read 2 more answers
FDIC is:
seropon [69]

Answer:

c) A government insurance program that will pay back account holders if the bank or lending institution fails

Explanation:

The FDIC is an acronym for Federal Deposit Insurance Corporation. It was founded by Franklin Roosevelt on the 16th of June, 1933.

FDIC is a government insurance program that will pay back account holders if the bank or lending institution fails.

The income generated from the premium payments of insured banks is used to fund or finance the FDIC.

5 0
3 years ago
Read 2 more answers
1. Over the past year, a customer has surrendered, in whole or in part, three life insurance policies. If part of a money launde
Thepotemich [5.8K]

Answer:

It represents the Integration stage

Explanation:

Money laundering is an illegal chain of activities done by individuals or corporate bodies to change the status of money gotten through a criminal activity into legitimate money. This chain of activities starts with the Placement stage then transforms into the Layering stage, then ends when it is already integrated into the legitimate financial system through the Integration stage.

After the money launderer conceals the illegal money through bank deposits or purchasing a life insurance policy at the Placement stage, the launderer then proceeds to further break the money into smaller amounts to evade suspicion by numerous transactions and bank deposits at the Layering stage, which is then ended by partial or whole surrenders of life insurance policies to make it now legitimate money.

3 0
2 years ago
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