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Stella [2.4K]
4 years ago
6

On June 1, 2021, Wildhorse & Sons sold equipment to James Landscaping Service in exchange for a zero-interest bearing note w

ith a face value of $106800, with payment due in 12 months. The fair value of the equipment on the date of sale was $90000. The amount of revenue to be recognized on this transaction in 2021 is
a. $106800.
b. $16800.
c. $90000.
d. $90000 sales revenue and $9800 interest revenue.
Business
1 answer:
Alja [10]4 years ago
8 0

Answer:

d. $90000 sales revenue and $9800 interest revenue.

Explanation:

Note will be recorded on the fair value of equipment and the net difference of the zero interest bearing bond and the fair value of he equipment will be recorded as the interest income.

Amount of sale = $90,000

Interest amount = $106,800 - $90,000 = $16,800

As only 7 months have been passed until end of 2021 from the date of sale

only interest of 7 months is recognized.

Interest income recognised in 2021 = $16,800 x 7 /12 = $9,800

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3 years ago
the gradual reduction of regional constrasts resulting form increasing cultural, economic, political and other types of exchange
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Answer: Globalization

Explanation:

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3 0
3 years ago
You observe that the inflation rate in the United States is 1.5 percent per year and that T-bills currently yield 2.0 percent an
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Answer:

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(b) 8.5%

(c) 9.5%

Explanation:

(a) Foreign country inflation rate - US inflation rate = Foreign country risk free rate - US risk free rate

Lets foreign country inflation rate = X

X - 1.5 = 8 - 2

X - 1.5 = 6

X = 6 + 1.5

   = 7.5%

(b)

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X - 1.5 = 9 - 2

X - 1.5 = 7

X = 7 + 1.5

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The Dark Chocolate Division of Yummy Snacks, Inc. had the following operating results last year: Sales (150,000 pounds of chocol
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Answer:

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Explanation:

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We simply applied the above formula so that the correct amount could come by dividing the units from the sales revenue

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