Answer:
E. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100.
Explanation:
Journal Entry for Issuance of 70 shares of $30 par value preferred stock for $4,000 is -
Cash Debited - $4,000
Paid in Capital in excess of Par value Credited - $1,900
Preferred Stock (70 shares × $30 each) Credited - $2,100
The correct option is - E. Debit Cash $4,000; credit Paid-in Capital in Excess of Par Value, Preferred Stock $1,900, credit Preferred Stock $2,100.
Answer: Option B
Explanation:
A. Explicit cost are the cost paid to others in return of their service. Hence Option A is incorrect.
B. Revenue is the total amount of earnings a company have before deducting for expenses. Hence Option B is correct.
C. Accounting profit means (Revenue - explicit cost) . Hence Option C is incorrect.
D. Economic profit means (Revenue - explicit cost - implicit cost) . Hence Option D is incorrect.
Answer:
a. less wealthy and they buy less.
Explanation:
we are assuming a situation where the price level rises (inflation rises), so anyone holding cash will be able to purchase a smaller amount of goods with the same amount of cash simply because the goods are more expensive. E.g. you purchased 10 goods with $100, but if the inflation rate increases to 10%, you will be able to purchase only 9 goods with the same $100. As inflation rises, people holding cash (or other monetary form) will lose wealth and purchasing power.
Answer:
13%
Explanation:
the new cost of equity = old cost of equity + [(debt / equity) x (old cost of equity - cost of debt)]
the new cost of equity = 12%+ [(20 / 80) x (12% - 8%)] = 12% + 1% = 13%
Since we are in the MM world, taxes do not exist, therefore they are not included in the equation.
Answer:
Option 3: $12 down with equal payments of $5 for 12 months
Explanation:
In option 1 :
The cost is $ 88,
In option 2 :
Down payment = $ 5,
Weekly payment = $ 8,
Number of weeks = 10,
So, the total cost = 5 + 8 × 10 = 5 + 80 = $ 85,
In option 3 :
Down payment = $ 12,
Monthly payment = $ 5,
Number of months = 12,
So, the total cost = 12 + 5 × 12 = 12 + 60 = $ 72,
In option 4 :
Down payment = $ 20,
Monthly payment = $ 20,
Number of months = 12,
So, the total cost = 12 + 20 × 12 = 12 + 240= $ 252
∵ 72 < 85 < 88 < 252
Hence, option 3 is better.
