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Luba_88 [7]
2 years ago
14

Ohlson Co. is preparing an Excel spreadsheet for its 20-year, 4.5%, $500,000 bonds payable. The bonds were issued on January 1 t

o yield 5% annually. Interest is paid semi-annually. A portion of the spreadsheet appears as follows: A B C D E 1 Stated rate: 0.045 2 Effective rate: 0.05 3 Face amount: 500,000 4 Term to maturity in years: 20 5 6 Period Cash Payment Interest Expense Change in Discount Outstanding Balance 7 0 8 1 9 2 What formula should Ohlson use in cell C8 to calculate interest expense for the first interest payment? Multiple Choice =E7*B3/2 =E7*B3 =B8 – D8 =E7*C2/2

Business
1 answer:
uranmaximum [27]2 years ago
6 0

Answer:

=E7*C2/2

Explanation:

The interest expense will be the carrying value of the bond times the effective interest rate.

On cell C8 we have the interest expense

On E7 we have the carrying value which is the outstanding balance.

Then, on C2 we got the effective rate

As this is an annual formula, we must divide by two to convert to semiannual rate.

A file is attached for how the excel sheet looks like

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8 0
3 years ago
Freeman Company's accounting records include the following information: Payments to suppliers $ 47,000 Collections on accounts r
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Answer:

$73,600

Explanation:

Cash flow from Operating Activity

Cash sales                                                          $26,000

Collections on accounts receivable                 $99,000

Payments to suppliers                                      ($47,000)

Cash generated from operations                     $78,000

Income taxes paid                                              ($4,400)

Net cash provided by operating activities       $73,600

therefore,

the amount of net cash provided by operating activities indicated by these transactions is $73,600

4 0
2 years ago
On July 31, Cynthia contributed land with a basis to her of $22,000 and a FMV of $30,000 to the Sterling Partnership in exchange
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Answer:

D

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See attached file

8 0
2 years ago
Your venture has net income of $600,000 taxable income of $1,000,000 operating profit of $1,200,000 total financial capital incl
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Answer:

EVA = -$180,000

Explanation:

given data

net income = $600,000

taxable income of $1,000,000

operating profit = $1,200,000

total financial capital = $9,000,000

tax rate = 40%

WACC = 10%

solution

we get here EVA that is express as

EVA = NOPAT - Invested Capital × WACC   ..................1

and here

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3 years ago
Inflows or other enhancements of assets or settlements of an entity's liabilities from delivering or producing goods, rendering
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Answer:

REVENUES

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