Answer:
Incurred but unpaid
Explanation:
When wages and salaries are incurred by an entity and paid, the entries required are debit Wages and Salaries expense, credit cash account. However, when the expense is incurred but cash is yet to be paid, this represents a liability to the organization and as such, an accrual is required. The entries to be posted are debit Wages and salaries expense (in the income statement), credit Accrued wages and salaries (in the balance sheet).
Answer:
x1.044 - x
Explanation:
The formula for calculating compound interest is as below
FV = PV × (1+r)^n
where FV = Future Value
PV = Present Value
r = annual interest rate
n = number of periods
How much would x dollars earn in 1 year at a rate of 4.4% compounded annually?
In this case, PV =X, r =4.4% and n=1
FV = x x ( 1+4.4/100)^1
Fv = x x( 1.044)^1
Fv = x1.044
x dollars will earn x1.044 - x
Gross profit is net sales minus the cost of goods sold. It reveals the amount that a business earns from the sale of its goods and services before the application of additional selling and administrative expenses.
Answer:
1. $550,000
Explanation:
1. It is given in the question that the stated interest rate and the market interest rate both are having the same rate, i.e, 12%.
Hence, the bonds are issued at the face value that is $550,000.
2. The Journal entries are as follows:
(i) On January 1,
Cash A/c Dr. $550,000
To bonds payable $550,000
(To record the bond issuance)
(ii) On December 31,
Interest Expense A/c Dr. $66,000
To cash A/c $66,000
(To record the first interest payment on December 31 assuming no interest has been accrued earlier in the year)
Workings:
Interest expense = $550,000 × 12%
= $66,000
Answer:
6.4%
Explanation:
we need to divide this investor's income in two parts:
- dividends are not taxed = $5,000 x 5% = $250
- capital gains = (selling price - basis) x (1 - tax rate) = ($4,975 - $4,900) x (1 - 15%) = $75 x 85% = $63.75
total after-tax gains = $250 + $63.75 = $313.75 / $4,900 = 0.064 ≈ 6.4%
