Based on the fact that Kim's flowers borrowed the money and used it to buy a new delivery vehicle, this business activity should be categorized as both a financing activity and an investing activity.
<h3>What should they classify this business activity as?</h3>
Because Kim's Flowers got the money as a loan, it would be recorded as an inflow for financial activities.
They then used it to purchase a delivery vehicle which is an investment and a capital asset so this will count as an investment activity.
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Answer:
Amount owed on a loan for the land = $80,000
Payment in cash for the loan = $80,000
(1) Assets decreases by $80,000 as cash is used for the payment of loan.
(2) Liabilities also decreases by the $80,000 i.e decrease in liability as the loan is settled down.
(3) Stockholders' equity: There is no change occurred in the seller's stockholders equity.
The messy ones with no format, and non interesting content within the resume.
Answer:
A) 912,000 net income
B) ROA = 9.31%
C) ROE = 14.95%
Explanation:
a) net income:

sales x profit margin = net income
15,200,000 x 6% = 912,000 net income
b) ROA = return on assets

912,000/9,800,000 = 0,0930612 = 9.31%
b) ROE = return on equity
we use accounting equation to solve for equity:
aasets = liab + equity
9.8 M = 3.7M + E
E = 9.8 - 3.7 = 6.1

912,000/6,1000,000 = 0,1495081 = 14.95%
Assume company x deposits $100,000 in cash in a commercial bank. If no excess reserves exist at the time this deposit is made and the reserve ratio is 20 percent, the bank can increase loans by a maximum of $500,000.
Reserve ratio = 20% = 20/100 = 0.25
Initial Money supply = (1/Reserve ratio)*New Deposit = (100,000/0.25) = $ 400,000
Reserve ratio = Rerserve / Deposit
=> Reserves = 0.25*100,000 = 25,000
Max Increase in Money Supply = Initial Money Supply + Reserves/ Reserve Ratio
= $ 400,000 + 100,000
= $ 500,000.
The term commercial bank refers to financial institutions that accept deposits, provide checking account services, issue various loans, and provide basic financial products such as certificates of deposit (CDs) and savings accounts to individuals and small businesses. refers to
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