Answer:
- Monthly Payment for Choice 1=$665.16
- Monthly Payment for Choice 2=$627.10
- Total Closing Cost for Choice 1=$241557.60
- Total Closing Cost for Choice 2=$233456
- (A)Choice 1 be the better choice the monthly payment is higher.
- (D)Choice 2 be the better choice because the monthly payment is lower.
Explanation:
Amount of Loan needed = $140,000
- A point is an optional fee which helps you get a lower interest rate on your loan.
- Closing costs are the fees you pay when obtaining your loan.
<u>Choice 1</u>
30-year fixed rate at 4% with closing costs of $2100 and no points.
Monthly Payment
P=$140,000
Monthly Rate=4% ÷ 12=0.04 ÷ 12=0.0033
n=12 X 30 =360
Monthly Payment=$665.16
Total Closing Cost =(665.16 X 360)+2100=$241557.60
<u>Choice 2</u>
30-year fixed rate at 3.5% with closing costs of $2100 and 4 points.
Monthly Payment
P=$140,000
Monthly Rate=3.5% ÷ 12=0.035 ÷ 12=0.0029
n=12 X 30 =360
Monthly Payment=$627.10
Total Closing Cost =(627.10 X 360)+2100+(4% of 140000)=$233456
Answer:
e. $90; $100
Explanation:
The reserve ratio also known as cash reserve ratio is the portion of deposit that commercial banks must hold onto, rather than lend out or invest. It is determined by the central bank of a country and it varies.
Deposit into local bank=$100
Reserve ratio=10%
reserve ratio=10% of $100
=10/100×$100
=0.1×$100
=$10
Bank reserve has increased by $100 - $10
=$90
Checkable deposit has increased by $100 dollars deposited.
Answer:
Option (B) is correct
Explanation:
Depreciation expense:
= (cost - salvage value) ÷ estimated useful life
= ($144,000 - $4,000) ÷ 4
= $35,000
Average investment:
= (cost + salvage value) ÷ 2
= ($144,000 + $4,000) ÷ 2
= $74,000
Net income:
= Annual net cash flows - Depreciation expense
= $46,100 - $35,000
= $11,100
Accounting rate of return:
= (Net Income ÷ Average investment) × 100
= ($11,100 ÷ $74,000) × 100
= 15%
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<h3>California Inc Estimated ending inventory is $319,000
</h3>
Explanation:
Goods available for sale = Beginning inventory + Net purchases
- California Inc Beginning inventory $310,000
- California Inc Net purchases = $905,000
- California Inc Goods available for sale = $1,215,000
Gross profit = Net sales * profit %
- California Inc Net sales = $1,280,000
- California Inc gross profit = 30%
- California Inc gross profit = $384,000
Estimated cost of goods sold = Net sales - Gross profit
- California Inc Estimated cost of goods sold = $1,280,000 - $384,000
- California Inc Estimated cost of goods sold = $896,000
Estimated ending inventory = Goods available for sale - Cost of goods sold
- California Inc Estimated ending inventory = $1,215,000 - $896,000
- California Inc Estimated ending inventory = $319,000
California Inc Estimated ending inventory is $319,000
