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
lukranit [14]
3 years ago
12

First National Bank loans Mike’s Shoe Store $100,000 for remodeling. On their balance sheets, this loan is an asset for Mike’s S

hoe Store and a liability for the First National Bank.
a.The loan leads to an increase in the money supply. an asset for Mike’s Shoe Store and a liability for the First National Bank.
b.The loan does not lead to an increase in the money supply. a liability for Mike’s Shoe Store and an asset for the First National Bank.
c.The loan leads to an increase in the money supply. a liability for Mike’s Shoe Store and an asset for the First National Bank.
d.The loan does not lead to an increase in the money supply
Business
1 answer:
butalik [34]3 years ago
8 0

Answer:

The answer is: C)The loan leads to an increase in the money supply. a liability for Mike’s Shoe Store and an asset for the First National Bank.

Explanation:

Fractional reserve banking refers to a banking system in which banks keep as reserves only a fraction of the money their clients deposited in them. By doing this, banks are able to use the rest of their clients' money to make loans and other financial operations, therefore creating "new money" and increasing the money supply. For example, a client A deposits $100, the bank keeps in reserve $10, and loans $90 to a different client B. Client A's $100 have created an extra $90 in new money.

When a company gets a bank loan, the loan becomes a liability for the company (they owe money) and an asset for the bank (someone owes them money).

You might be interested in
Market equilibrium is: Select one: a. the point at which a nation reaches full employment b. the time period used to determine t
fenix001 [56]

Answer:So far we have learned to measure real GDP, but how do we end up with that real GDP? Of all of the different amounts of national income and price levels that might exist, how do we gravitate toward the one that gets measured each year as real GDP?

In short, it is the interaction of the buyers and producers of all output that determines both the national income (real GDP) and the price level. In other words, the intersection of aggregate demand (AD) and short-run aggregate supply (SRAS) determines the short-run equilibrium output and price level.

Once we have a short-run equilibrium output, we can then compare it to the full employment output to figure out where in the business cycle we are. If current real GDP is less than full employment output, an economy is in a recession. If current real GDP is higher than full employment output, an economy is experiencing a boom. If the current output is equal to the full employment output, then we say that the economy is in long-run equilibrium. Output isn’t too low, or too high. It’s just right.

Explanation: hope this helps

6 0
2 years ago
What is the first account number used in the liabilities division? A. 20 C. 2 B. 21 D. 02
zepelin [54]

Answer:

the answer is A. 20

Explanation:

7 0
3 years ago
Esquire Comic Book Company had income before tax of $1,550,000 in 2021 before considering the following material items: 1. Esqui
olga2289 [7]

Answer:

                   Esquire Comic Book Company

                                Income Statement

                For the Year Ended December 31, 2021

Operating income                                                 $1,550,000

Restructuring costs                                                 ($60,000)

Income from continuing operations b/ Taxes     $1,490,000

<u>Income tax expense                                              ($372,500)</u>

Income from continuing operations                                        $1,117,500

Discontinued operations:

  • Operating income                                          $610,000
  • Loss on disposal                                          ($395,000)
  • <u>Income tax on discontinued operations       ($53,750)</u>

Income from discontinued operations                                     $161,250

<u>Net income                                                                             $1,278,750</u>

Explanation:

Income from discontinued operations must be reported separately, but any restructuring costs must be included as operational expenses.

3 0
3 years ago
Roth Service Co. experienced the following transactions for 2018, its first year of operations: Provided $80,000 of services on
Stels [109]

Answer and Explanation:

a. The preparation of income statement is shown below:-

                               Income Statement

Service revenue                               $80,000

operating expenses  

Salary expenses           $28,000

Uncollectible accounts

expense                        $3,273

Total operating expense                   $31,273

Net income                                         $48,727

Working Note :-

Days       Amount     Percentage     Allowance balance

Current   $16,800       0.01                  $168

0-30         $5,100        0.05                 $255

31-60       $4,000        0.10                  $400

61-90       $2,000        0.30                 $600

Over 90

days         $3,700       0.50                  $1,850

Total        $31,600                                $3,273

b. The computation of net realizable value of the accounts receivable is shown below:-

Net realizable value = Accounts receivable - Allowance for doubtful accounts

= ($80,000 - $48,400) - $3,273

= $31,600 - $3,273

= $28,327

4 0
3 years ago
Specific statements detailing what the organization intends to accomplish over a short period of time are call
kondor19780726 [428]

Specific statements detailing what the organization intends to accomplish over a short period of time are called objectives. Objectives are stated by the company to keep goals on track and allow the organization to monitor their growth and completion. By keeping objectives open to everyone within the organization, it makes it easier for employees to stay on task and make sure by the end of the period, everything is done.

3 0
3 years ago
Other questions:
  • The chart attached shows the costs and shipping times for materials that a company needs to build a new product.
    12·2 answers
  • Each of the following factors affects the weighted average cost of capital (WACC) equation. Which of the following factors are o
    8·1 answer
  • True or false A coupon is the stated interest on a corporate, municipal, or government bond.
    11·1 answer
  • Opinion: You have an opportunity to attend a four-year college for free. However, you are required to major in a career area tha
    8·1 answer
  • On January 1 of this year, Ikuta Company issued a bond with a face value of $115,000 and a coupon rate of 4 percent. The bond ma
    12·1 answer
  • The foreign-exchange market is located exclusively in the united states. true or false
    13·1 answer
  • If a sole proprietorship fails, the owner of the business will _______
    10·1 answer
  • When living off campus, one way to save money is to rent an apartment where:?
    5·1 answer
  • In this assignment, you will develop a more personalized understanding of the Balanced Scorecard concept and see how your vision
    8·1 answer
  • Indicate what components of GDP (if any) each of the following transactions would affect. Check all that apply.
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!