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SOVA2 [1]
3 years ago
14

On Kyle Thomason’s $400,000.00 loan, the lender charges a 2-point service charge. In this situation, how much will Kyle have to

pay for this service charge at closing, and how would such a charge appear on the statement?
a) $800.00, as a debit to the buyer.
b) $8,000.00 as a credit to the buyer.
c) $8,000.00 as a debit to the buyer.
d) $80,000.00 debit to the buyer.
Business
2 answers:
bearhunter [10]3 years ago
6 0

Answer:

The answer is C

Explanation:

This is an interest expense.

In accounting, the rule is as follows:

Debit side increases asset and expenses while credit side decreases liability, shareholders' equity and sales or revenue.

Credit side decreases asset and expenses while credit side increases liability, shareholders' equity and sales or revenue.

2 points on $400,000 means the interest charge is 2 percent on $400,000.

So we have 0.02 x $400,000

$8,000.

It will be a debit side because it is an increase in expense.

likoan [24]3 years ago
5 0

Answer:

c) $8,000.00 as a debit to the buyer.

Explanation:

Point is referred to the percentage of anything. 1 point means 1%. 2 point service charges mean 2%of service charges of the total amount.

Amount of Loan = $400,0000

Service charges rate = 2 points / 2%

Service charges = $400,000 x 2% = $8,000

Service charges amount is paid by Kyle is an expense which is shown as debit as an expense

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Answer:

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Northwestern Data Systems has adopted a new organizational approach with regard to information flow, ensuring that employees hav
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Answer:

neither she nor her supervisor has any demonstrable reason to access such information.

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2 years ago
8) walter co. and sandburg industries report the following information at december 31: walter sandburg accounts receivable $41,0
True [87]

Walter Co. is a manufacturer because it uses raw materials, and has a stock of merchandise inventory, work-in-progress inventory, and finished goods inventory. The current assets of Walter Co. will be:

Current Assets:

Cash                                                          6,000

Inventories

Raw materials inventory       21,000

Work in progress inventory  40,000

Finished goods inventory      25,000

Merchandise inventory           48,000

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A manufacturing company is a company that takes in raw materials processes the raw materials and then sells the finished goods manufactured in the market. So the current assets section of the balance sheet of Walter Co. is given which will be written on the right side of the balance sheet.

Learn more about manufacturing companies here:

brainly.com/question/14942185

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