Answer:
B. keep his shop going because he's earning a healthy $35,000 a year
Explanation:
Imagine Tom's annual salary as an assistant store manager is $30,000, he owns a building that rents for $10,000 yearly, and his financial assets generate $1,000 per year in interest. One day, after deciding to be his own boss, he quits his job, evicts his tenants, and uses his financial assets to establish a bicycle repair shop. To run the business, he outlays $15,000 in cash to cover all the costs involved with running the business, and earns revenues of $50,000.
Tom's accounting profits = $50,000 - $15,000 = $35,000
Answer:
Debit Building $338,000
Credit Cash $58,000
Credit Notes Payable $280,000
Explanation:
Preparation of the journal entry to Record the purchase of the building on January 1, 2021.
Based on the information given we were told that the company purchases an office building for the amount of $338,000 which means that if they paid $58,000 down and as well borrowed the remaining amount of $280,000 the journal entry to Record the purchase of the building on January 1, 2021 will be :
Debit Building $338,000
Credit Cash $58,000
Credit Notes Payable $280,000
(Being to record the purchase of building)
Answer: Contracts
Explanation: Because the 2 parties are coming to a contractual agreement.
Answer:
$ 39,165.00
Explanation:
the amount expected from customer in one year is the face value of the note receivable plus interest i.e $40,000*105%=$42,000
The interest on discounting is :
$42,000*9%*9/12=$2,835
The amount of cash that Ireland would receive from the Cloverdale Bank is the amount that Cloverdale would on maturity of the note receivable i.e $42,000, less the discount on the note of $2,385
cash received=$42,000-$2,835=$ 39,165.00
Cloverdale would pay $ 39,165.00 on September 2021 to Ireland Corporation