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3 years ago

When the Fed sells government securities, the banks':

Business

1 answer:

kykrilka [37]3 years ago

3 0

Answer:

The correct answer is option B.

Explanation:

When the Federal reserve bank sells government securities, the banks will purchase them and pay back fed. This payment is made out of banks' reserves. This causes the reserves to decrease.

As reserves decline, the banks will be able to provide fewer loans. Consequently, this decrease in lending will further cause the money supply to decrease.

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What countries represent the largest global business opportunities for the next decade? What factors determine the size of the o

EastWind [94]

China, India and Brazil are some of the largest growing global businesses. These come from many different factors; GDP growth and population are two major causes. China has the largest populations in the world along with the fastest growing GDP percentages.

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4 years ago

Q 9.37: when should the gross profit method of inventory valuation not be used because it is invalid?

rusak2 [61]

At the end of given period the gross profit method is required to estimate inventory.The valuation become invalid when the following are not available.the value for the beginning of inventory,records of purchase made, the total sale during the period and the gross profit margin.

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3 years ago

Explain how the accounting for a fair value hedge differs for the hedged item and for the hedging item compared to the accountin

igomit [66]

A cash flow hedge is accounted for differently than a fair value hedge.

<h3>What is a Fair Value Hedge?</h3>

Fair price hedges may be used to mitigate the danger of modifications withinside the truthful marketplace price of liabilities, belongings, or different company commitments. Generally, truthful price hedges pass withinside the contrary route of the hedged object so they may be used to cancel out your losses. As a result, derivatives like alternatives and futures are fantastic examples of truthful price hedges.

<h3>What is a Cash Flow Hedge?</h3>

Cash go with the drift hedges can assist to mitigate the dangers which are related to surprising modifications in coins flows of belongings or liabilities, instead of the asset or legal responsibility itself. There are many various factors that could result in those kinds of modifications, inclusive of increases/decreases in forex rates, modifications in hobby rates, modifications in asset prices, and so on.

<h3>What’s the distinction among Cash Flow Hedge and Fair Value Hedge?</h3>

As you could see, the important thing distinction among a coins go with the drift hedge and a truthful price hedge is the hedged object. With a coins go with the drift hedge, you’re hedging the modifications in coins influx and outflow from belongings and liabilities, while truthful price hedges assist to mitigate your publicity to modifications withinside the price of belongings or liabilities. So, at the same time as truthful price hedges are first-rate acceptable to constant price items, the blessings of coins go with the drift hedges lead them to perfect for variable price items.

Learn more about Hedging on:

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4 0

2 years ago

Kansas Enterprises purchased equipment for $73,000 on January 1, 2021. The equipment is expected to have a five-year service lif

Margaret [11]

Answer:

Depreciation expense = $13,130

Book value = $46,740

Explanation:

Depreciation is a method of expensing the cost of an asset.

Depreciation expense using the straight line method = (Cost of asset - salvage value) / useful life

($73,000 - $7,350) / 5 = $13,130

The depreciation expense each year would be $13,130.

Book value = Cost of asset - Depreciation expense

In December 2021, the book value would be = $73,000 - $13,130 = $59,870

In December 2022, the book value would be = $59,870 - $13,130 = $46,740

I hope my answer helps you

4 0

3 years ago

In its most recent annual report, Appalachian Beverages reported current assets of $54,000 and a current ratio of 1.80. Assume t

svetlana [45]

Answer:

Current Ratio - Transaction 1 = 1.6666 rounded off to 1.67

Current Ratio - Transaction 2 = 1.6388 rounded off to 1.64

Explanation:

The current ratio is a measure of liquidity which measures the amount of current assets a business has to pay off each $1 of current liability. It is calculated as follows,

Current Ratio = Current Assets / Current Liabilities

We know the initial current ratio and current assets. The initial current liabilities will be,

1.8 = 54000 / Current Liabilities

Current Liabilities = 54000 / 1.8

Current Liabilities = $30000

Transaction 1

The result of transaction 1 will be that the current assets will increase by $6000 as inventory increases and the current liabilities will also increase by $6000 as accounts payable are increasing. The new current ratio will be,

Current Ratio - Transaction 1 = (54000 + 6000) / (30000 + 6000)

Current Ratio - Transaction 1 = 1.6666 rounded off to 1.67

Transaction 2

The result of transaction 2 will be that the current assets will decrease by $1000 as payment for truck which is a fixed asset is made partly by cash and the current liabilities will not increase as the note signed for the remaining payment of the truck is due after 2 years thus it is a non current liability. The new current ratio will be,

Current Ratio - Transaction 2 = (54000 + 6000 -1000) / (30000 + 6000)

Current Ratio - Transaction 2 = 1.6388 rounded off to 1.64

5 0

3 years ago