1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Kryger [21]
3 years ago
5

The George Company has a policy of maintaining an end-of-month cash balance of at least $40,000. In months where a shortfall is

expected, the company can draw in $1,000 increments on a line of credit it has with a local bank, at an interest rate of 12% per annum. All borrowings are assumed for budgeting purposes to occur at the beginning of the month, while all loan repayments (in $1,000 increments of principal) are assumed to occur at the end of the month. Interest is paid at the end of each month. For April, an end-of-month cash balance (prior to any financing and interest expense) of $14,000 is budgeted; for May, an excess of cash collected over cash payments (prior to any interest payments and loan repayments) of $31,200 is anticipated.
a. What is the interest payment estimated for April (there is no bank loan outstanding at the end of March)? (Do not round intermediate calculations.)
b. What is the total financing effect (cash interest plus loan transaction) for May? (Do not round intermediate calculations.)
Business
1 answer:
Amiraneli [1.4K]3 years ago
3 0

Answer:

A.$130

B. $13,130

Explanation:

Loan taken at the beginning of april in order to maintain cash balance of $40,000 = $40,000 - $27,200 = $12,800 = $13,000 (Increment of $1,000)

Interest payment estimated for april = $13,000*12%*1/12 = $130

Solution b:

Cash balance at the end of april = $27,200 + $13,000 - $130 = $40,070

Cash balance at the end of may before financing effect = Cash balance at the beginning + Excess of cash collected over cash payments

= $40,070 + $31,200 = $71,270

Total financin effect for may = Loan repayment + Interest repayment = $13,000 + $13,000*12%*1/12 = $13,130

You might be interested in
For girls, the usual sequence of physical changes in puberty is _____. the growth spurt, menarche, and the beginning of breast d
siniylev [52]
<span>Through puberty the child's body matures into an adult body capable of sexual reproduction.</span>
For girls, the usual sequence of physical changes in puberty is  nipple growth, the growth spurt, and menarche.
Girls pubertal changes<span> usually begin before boys of the same age.
</span>The pubic hair development comes shortly after breast development.
6 0
4 years ago
Marshall Enterprises charged the following amounts of overhead to jobs during the year: $20,000 to jobs still in process, $60,00
Readme [11.4K]

Answer:

Dr  Factory Overhead Payable $5,000

Cr                          Cost of Goods Sold $5,000

Explanation:

What we have done?

Cr  Factory Overhead   $5000

What we must do?

Dr Factory Overhead $5000

The entry in the expense account is credited, as said in the question. So what we must do is debit it back and waive off its affect from the cost of sales.

So at the end of the period the company is legally required to close the expenses and revenue accounts in-accordance to International Financial Reporting Standards.

What must be the entry?

So the journal entry would be :

Dr  Factory Overhead  $5,000

Cr          Cost of Goods Sold $5,000

3 0
3 years ago
How does the economic boom affect a business or your business?
shepuryov [24]

Answer:

The answer is easy and simple to understand.

First of all, it ill be generally good for your business, price levels of materials required and services will remain at a reasonable level so you can afford them.

Moreover, the cost of financing will be bearable and low. Since the interest rates are low, more money can be borrowed to expand your business venture.

Economic book means more employment opportunities, and as the supply of labor increases. the cost or the wage rate can remain at a reasonable and fair level for both the employers and employees.

The currency exchange rates will be stable and will not deviate heavily during the economic boom period, making importing and importing fairly easy for your business.

However, since the economy is rigorous and healthy, more entrepreneurs will enter the market and the competition will  be sever.

Moreover, foreign investors and businesses with new technologies, products and practices may enter your market, making it a bit difficult for you.

Explanation:

4 0
4 years ago
What is the best way to put together a business plan?
V125BC [204]
The correct answer would be D. You're Welcome!! <span />
4 0
3 years ago
Read 2 more answers
Bill and Charlene enter into a contract for the clearing, plowing, and preparing of Charlene’s 100-acre tract for which she agre
Nadusha1986 [10]

Answer:

b. does not relieve Bill of the potential obligation to perform.

Explanation:

An obligation is a legal bond (vinculum iuris) by which one or more parties (obligants) are bound to act or refrain from acting.

An obligation thus imposes on the obligor a duty to perform, and simultaneously creates a corresponding right to demand performance by the obligee to whom performance is to be tendered

4 0
3 years ago
Other questions:
  • Provide an example of a closed‐end credit account that Caroline has. (1 point) 
    9·2 answers
  • A restaurant that offers food made exactly to each customer's preference is providing __________ utility.
    10·1 answer
  • Job 607 was recently completed. The following data have been recorded on its job cost sheet:Direct Materials $3,405 Direct Labor
    15·1 answer
  • The following data were accumulated for use in reconciling the bank account of Creative Design Co. for August 20Y6: 1. Cash bala
    14·1 answer
  • Matthews Delivery Service, Inc., completed the following transactions during its first month of operations for January 2012:
    15·1 answer
  • If Edward wants to earn $215,000 within the next 20 years and the salaries grow at 4.15% per year, what salary should he start a
    7·2 answers
  • Which of the following circumstances must be present for departmental overhead allocation to be favored over a traditional overh
    13·1 answer
  • Cyclical unemployment select one:
    5·1 answer
  • PLEASE <br>what is lean production? in details (GCSE) keywords.​
    6·1 answer
  • When economists say that the demand for labor is a derived demand, they mean that it is:.
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!