Answer:
TVG
Times Interest Earned Ratio (TIER) = Earnings Before Interest & Taxes divided by Interest Expense
= $300,000/$$80,000 = 3.75 times
Explanation:
a) TVG Income Statement:
Revenue $3,000,000
Cost of goods sold 2,500,000
Gross profit $500,000
Depreciation 200,000
EBIT $300,000
Interest Expense 80,000
Pre-tax Income $220,000
b) TVG's TIER shows the number of times that its earnings before interest and taxes covers the interest expense. It shows the ability of the TVG to settle its maturing debt obligations from current earnings. It is an important financial performance measure which potential investors in TVG will use to gauge the ability of TVG to meet financial obligations from the earnings it generates.
Explanation:
1. The journal entry is as follows:
On March 1
Prepaid insurance A/c Dr $36,000
To Cash A/c $36,000
(Being the prepaid insurance is recorded for cash)
For recording the advance purchase of insurance, we debited the prepaid insurance and credited the cash account. Both the accounts are recorded at $36,000 so that the proper posting could be done.
Answer:
Explanation:
A swap transaction in the inter bank market is the simultaneous purchase and sale of a given amount of foreign exchange for two different value dates. The purchase and sale are with the same counterpart. A swap may be considered a technique for borrowing another currency on a fully collateralize basis.
Answer:
a
Life
Explanation:
Life insurance is a contract where the insurance company undertakes to pay the amount stated in the policy document upon the insured's death. The insured, in turn, pays periodic insurance premiums to keep the contract in force.
Life insurance renders financial protection to the family and the insured upon their death. For an entrepreneur, the insurance company will compensate their family for the loss of income occasioned by their death.
Answer:
That statement is true.
Explanation:
Basically, You put your money in saving if you intended to use that money for future consumption. You put your money in investment if you intended to make financial gain out of it.
For example,
Let's say that you want to buy a laptop that cost $700. You only able to spend $350 per month since you have to consider other more important payment such as rent or food. So you set aside $350 for two month and purchase the laptop at the end of the second month. This is an example of saving.
In another case let's say that you put that $350 in Bonds rather than purchasing laptop. You Let that bond mature and take a 3% interest as profit. Two month later, the value of your money is increased. This is an example of an investment.
