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ivanzaharov [21]
3 years ago
6

On January 1, 20X6, Nichols Corporation issued 10-year bonds at par to unrelated parties. The bonds have a 10% stated rate, face

value of $300,000, and pay interest every June 30 and December 31. On December 31, 20X9, Harn Corporation purchased all of Nichols' bonds in the open market at a $6,000 discount. Harn is Nichols' 80 percent owned subsidiary. Harn uses the effective interest method of amortization. The consolidated income statement for the year 20X9 should report with respect to the bonds:
I. interest expense of $30,000.
II. a gain of $6,000
a. I and II
b. II but not I
c. Either I or II
d. Neither I nor II
Business
1 answer:
BartSMP [9]3 years ago
4 0

Answer:

a. I and II

Explanation:

As there is an interest expense of $30,000 i.e come from

= $300,000 ×10%

= $30,000

This would be reflected on the consolidated income statement for the year 20X6. And the extraordinary gain which generally disclosed to the financial statement notes

Therefore in the given situation it is being considered as only a gain, not as an extraordinary gain

Hence, both the amounts i.e interest expense and the gain will be reported in consolidated income statement for the year 20X6  

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The answer is C: chronological (because it pertains to an order and can involve history. 
3 0
3 years ago
2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-qua
Vadim26 [7]

The original data is :

Data for Hermann Corporation

                                          Per unit     Percent of sales

Selling price                         $ 75              100%

Variable expenses                  51                 68

Contribution margin             $ 24               32%

The fixed expenses are $ 75,000 per month and the company is selling 4000 units per month.

Solution :

                                                     Present             Proposed

Sales                                             300000            375000

Less : Variable cost                      204000           275000

Contribution margin                     96000               100000

Less : Fixed expenses             <u>    75000     </u>      <u>     75000    </u>

Net income                                   21000                25000

The net operating income :      Increases          4000

Net operating income = increased sales Net income - current sales net income.

Therefore the higher quality component should be used.                                                            

8 0
2 years ago
A in the expected future exchange rate ______ the demand for u.s. dollars. in the u.s. demand for imports _______ the demand for
KIM [24]

A in the expected future exchange rate increases the demand for u.s. dollars. in the u.s. demand for imports does not change the demand for u.s. dollars.

In economics, demand is the number of goods that consumers are willing to purchase at various prices in a particular location and during a particular period of time. [1] The relationship between price and quantity demanded is also called the demand curve. Demand for a particular item is a function of perceived need, price, perceived quality, convenience, available alternatives, disposable income, buyer preferences, and many other options.

Demand refers to the consumer's willingness to buy and pay for goods and services without hesitation. Simply put, demand is the number of items that customers are willing to purchase at various prices over a period of time.

Learn more about demand here

brainly.com/question/1288364

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8 0
2 years ago
Keisha owns a house worth $275,000 with a mortgage of $195,000. She owns a car worth $12,000 and has $7,500 in car loans. She ha
Rainbow [258]

Answer:  $88,700

Explanation:

Given that,

House value = $275,000

Mortgage = $195,000

Car value = $12,000

Car loans = $7,500

Investments = $3,000

Bank account = $2,700

Owes on a credit card = $1,500

Keisha’s net worth:

= House value - Mortgage + Car value - Car loans + Investments + Bank account - Owes on a credit card

= $275,000 - $195,000 + $12,000 - $7,500 + $3,000 +  $2,700 -  $1,500

= $88,700

6 0
3 years ago
The problem with adopting a fair-return pricing policy for a natural monopoly is that Multiple Choice economic profits will be p
ASHA 777 [7]

Answer:

it is not allocatively efficient

Explanation:

Monopoly is a market condition where one seller has all the market share. This leads to an inefficient market structure, an increase in the prices of goods and services and abnormal profits. A problem with adopting a fair return polity for a natural monopoly is that it is not allocatively efficient. In a monopoly, goods and services are not produced to help the economy or people.

7 0
2 years ago
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