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3 years ago

are said to be at "arm's length," while are to be reported separately in the financial statements.

Business

1 answer:

Zigmanuir [339]3 years ago

8 0

Answer:

The answer to the first blank is credit sales to customers, the second blank space is loans to company officers.

Explanation:

When offering credit sales to customers, financial institutions tend to operate in an arm’s length setting, which is the default operating process when dealing with customers. This differs from when they offer loans to company officers, or the company’s employees. Depending on the company, employees might be able to access credit at a different rate compared to the normal customers. Nevertheless, these transactions should be recorded separately from the financial statements made in the company.

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On January 1, a company issues bonds dated January 1 with a par value of $730,000. The bonds mature in 3 years. The contract rat

quester [9]

Answer:

a. Debit interest expense $38,500; credit discount on bonds payable $2,000; credit cash $36,500

Explanation:

As the bonds are sold less than the face vaue then it is said the bonds are issued on discount, we need to calculate the discount on the bond

Discount on the bond = Face value of bond - Issuance value of bond = $730,000 - $718,000 = $12,000

The discount will be amortized over the life of the bond

The first interest and its amortization is as follow

Cash Payment = Face value x Coupon rate x Semiannual fraction = $730,000 x 10% x 6/12 = $36,500

Amortization of discount on bond = Discount on Bond / Total Numbers of periods = $12,000 / ( 3 years x 2 payment period per year ) = $2,000 per eperiod

The cash will be credited by $36,500

The bond liability will be credited by $2,000

Hence the interest exepense will be debited by $38,500 ( $36,500 + $2,000 )

6 0

3 years ago

4. Tom Busby owes $20,000 now. A lender will carry the debt for four more years at 8 percent interest. That is, in this particul

bezimeni [28]

Answer:

Tom Busby

His annual payment will be:

= $4,091.64

Explanation:

a) Data:

Loan = $20,000

Interest on loan for 4 years = 8% per annum

Amount of loan after 4 years = $27,200 ($20,000 * 1.360)

Payment period = 12 years

Interest rate during payment period = 11%

b) From online finance calculator:

You will need to pay $4,091 every year for 12 years to payoff the debt at 11% interest.

Monthly Payment $340.97

Annual Payment $4,091.64

Time Required to Clear Debt 12.00 years

Total of 144 or 12 Payments = $49,099.25

Total Interest $21,899.25

8 0

3 years ago

Gouda Company and Cheddar Company had the same sales, total costs, and income from operations for the current fiscal year; yet G

Sedaia [141]

Answer:

If both companies have the sames sales volume, total costs and income from operations, the reason why Gouda has a lower break even point is that their variable costs are lower. We use the contribution margin per unit to calculate the break even point and the contribution margin per unit = sales price - variable costs. The question states that total costs are equal, but it doesn't say anything about variable or fixed costs.

Assuming that Gouda is above break even point, each sale will generate a higher operating profit since the contribution margin is higher.

Explanation:

3 0

2 years ago

Identify the characteristics that have enabled Singapore to become one of the world’s most prosperous nations. Correct Answer(s)

ella [17]

Answer:

The answers are : Stable financial system; Strategic location; High literacy rate.

Explanation:

Singapore is a small island, highly populated country without much natural resources and little resources are paid to agricultural sector and energy sector thus lack of self-sufficiency in regard to water, food (due to limited land, lack of water supply and high labor cost). Currently, more than 40% of the country's water consumption are exported from Malaysia.

However, thanks to its strategic location lying in the center of the trade flow between the America, Europe, Middle East - Africa and Asia and the heart of Asia; its stable financial system which is one of the financial centers of Asia and the world due to its pretty open economy; its highly-educated citizens ( according to UNESCO Singapore literacy rate has been going up from nearly 83% in 1980 to more than 97% in 2018), the country is among one of the most prosperous countries in the world.

6 0

2 years ago

Powell Company began the Year 2 accounting period with $20,000 cash, $60,400 inventory, $48,600 common stock, and $31,800 retain

jekas [21]

Answer:

Explanation:

Dr Accounts Receivable 74600

Cr Sales Revenue 74600

Dr Cost of Goods Sold 37900

Cr Inventory 37900

Dr Freight Out 310

Cr Cash 310

Dr Sales Revenue 3880

Cr Accounts Receivable 3880

Dr Inventory 1910

Cr Cost of Goods Sold 1910

Dr Sales Revenue 1160

Cr Accounts Receivable 1160

Dr Cash 53300

Cr Accounts Receivable A/c 53300

3 0

3 years ago

________ are said to be at "arm's length," while ________ are to be reported separately in the financial statements.

are said to be at "arm's length," while are to be reported separately in the financial statements.