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Ivahew [28]
3 years ago
12

On the last day of October, Wicker Company borrows $120,000 on a bank note due in 90 days (3 months) at %11 percent. Interest is

not included in the face amount. Assume that Wicker properly recorded the borrowed amount at October 31. If no payments have been made with respect to this loan, should a liability be recorded at Wicker's fiscal year end of December 31, and if so, what is the amount of the liability that should be record? Assume that each month is 30 days.
Business
1 answer:
rodikova [14]3 years ago
3 0

Answer:

interest expense 3,000 debit

   interest payable       3000 credit

Explanation:

We will recognize the accrued interest for the period Nov 1st to Dec 31th

 principal   x   rate     x    time

  120,000   x 11%/12   x 3 months = 3,000

We divide the rate by 12 as there is express as annual rate and we need to match with time, which is months.

The entry will recognize interest expense for 3,000

and interest payable for 3,000

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To finance some manufacturing tools it needs for the next 3 years, waldrop corporation is considering a leasing arrangement. the
KATRIN_1 [288]
"The answer is $106".

After tax cost of debt               6%
Dep per year                          1600
Tax sav from dep                   640
cost of owning       0               1
interest                                  -480
tax saving                               192
maintence                                 -240
maintenece saving                     96
Depn tax saving                          640
loan repay
net cash cost                              208
PV cost of owning (6%)             -3474
cost of leasing
lease payment                           -2100
Tax savings from lease                840
net cash cost                           -1260
PV cost lease 6%                     -3368
PV cost own - Pv cost lease       106
3 0
3 years ago
You have purchased a small medical office building in Hoboken for $3,500,000 and financed the acquisition by borrowing $2,500,00
umka21 [38]

Answer:

$200,000

Explanation:

Interest calculation is based on the Principle amount of $2,500,000 borrowed .

6 0
2 years ago
Ambrin Corp. expects to receive $2,000 per year for 10 years and $3,500 per year for the next 10 years. What is the present valu
sineoko [7]

Answer:

A. $19,034

Explanation:

The computation of the present value for 20 years cash flow is shown below:

For the First 10 years

Given that

Payment for first 10 years = $2,000

Discount rate = 11%

Now the present value is

= $2000 ÷ 1.11 + $2,000 ÷ 1.11^2 +...........+ $2,000 ÷1.11^10

= 11,778.46402 ..............(1)

For the Next 10 years

Given that

Payment for next 10 years = 3,500

Discount rate = 11%

Now the present value is

= $3,500 ÷ 1.11 + $3,500 ÷ 1.11^2 +...........+ $3,500 ÷ 1.11^10

= 20,612.312

So, today present value is

= $20,612.312 ÷ 1.1110

= 7,259.339 ...........................(2)

Now

Total present value is

= $7,259.339 + $11,778.46402

= $19,034

3 0
3 years ago
What are two advantages of bonds for their users?​
8_murik_8 [283]

Answer:

Explanation:

Bonds have some advantages over stocks, including relatively low volatility, high liquidity, legal protection, and a variety of term structures.

3 0
3 years ago
Read 2 more answers
How should Product Backlog items be chosen when multiple Scrum Teams work from the same Product Backlog
marishachu [46]

It should be noted that the product backlog item can be chosen as the scrum team with the highest velocity pulls product backlog items first.

<h3>What is product backlog?</h3>

A product backlog simply means a prioritized list of work that is gotten from the requirements available.

The product backlog item can be chosen as the scrum team with the highest velocity pulls product backlog items first.

Learn more about product backlog on:

brainly.com/question/4841869

7 0
2 years ago
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