Answer:
Journal entries is seen below
1. Interest payment expenses $170,100
To cash $170,100
2. Cash $420,000
To bond payable $420,000
Explanation:
Journal entries with explanations.
1. Interest expenses $170,100
To cash $170,100
(It is recorded being the first interest payment)
The working is as seen below;
= $3,780,000 x 9% x 6 months ÷ 12 months
= $170,100
As per the recording, the interest expense was debited because it increased the expenses while cash is paid which reduced the cash balance hence credited.
2. Cash $ 420,000
To bond payable $420,000
(Being the cash sale of bond that is recorded.)
For the recording, cash was debited as it was received because it increased the cash balance and also credited to bond payable account.
Answer:
8%
Explanation:
According to CAPM :
expected stock yield =risk free rate + (beta x market yield)
6% + 1.5 x market yield = 18%
18% - 6% = 1.5market yield
solving for market yield gives
market yield = 8%
Answer:
The best response to Tracy's comments is:
B. Although you can hire someone to keep your books, you'll still need to know how to read, understand, and interpret basic accounting reports in order to make good business decisions.
Explanation:
Here in the given question it is mentioned that Tracy is wanting to start her own business but she has a very little knowledge about how to setup an accounting system and how the financial interpretation is been done.
So, she tells her friends that she is not at all worried about accounting. For this purpose she will be hiring a part time book keeper who will be handling all her stuff and who will also help her in focussing her attention in the different and innovative ideas of satisfying her customers.
Therefore, the best response to Tracy's comments can be given by:
B. Although you can hire someone to keep your books, you'll still need to know how to read, understand, and interpret basic accounting reports in order to make good business decisions.
Questions should be the right answer