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
Vitek1552 [10]
3 years ago
9

On January 1, 2017, when the market interest rate was 14%, Luba Corporation issued bonds

Business
1 answer:
Anton [14]3 years ago
4 0

Answer:

the bond discount = face value - market value

market value = PV of face value + PV of coupon payments

PV of face value = $500,000 / (1 + 7%)²⁰ = $129,209.50

PV of coupon payments = $30,000 x 10.594 (PV annuity factor, 7%, 20 periods) = $317,820

market value = $447,029.50

January 1, 2017, bonds are issued at a discount

Dr Cash 447,029.50

Dr Discount on bonds payable 52,970.50

    Cr Bonds payable 500,000

the discount amortization for first coupon payment = ($447,029.50 x 7%) - $30,000 = $31,292 - $30,000 = $1,292

July 1, 2017, first coupon payment

Dr Interest expense 31,292

    Cr Cash 30,000

    Cr Discount on bonds payable 1,292

You might be interested in
Using the method of your choice, calculate the Net Present Value of the following cash flows. Assume that the required return on
mezya [45]

Answer:

E. $78

Explanation:

The computation of the net present value is shown below:

Net present value is

= Initial investment + year cash inflows ÷  (1 + discount rate)^number of years + year cash inflows ÷  (1 + discount rate)^number of years

= -$150 + $175 ÷ 1.15 + $100 ÷ 1.15^2

= $77.78

= $78

Hence, the correct option is E. $78

8 0
3 years ago
Explain how technology has dramatically affected the efficiency and effectiveness of finding customers.
saw5 [17]
Technology innovates more and more products in this century. It makes the lives of people much easier. Therefore, they are attracted to buy such products that are directly offered by these companies who have hired technicians and scientists to innovate products. Or, another case would be that they have bought these technologies from companies that have sold it to them. Technology provides efficiency and therefore, it makes an effective solution to attract consumers, or customers in the process.
4 0
3 years ago
According to Porter's model of business activities, interactions across value activities are called ________.
IRINA_888 [86]

According to Porter's model of business activities, interactions across value activities are called linkages.

<h3>What was Porter's model of business activities?</h3>

A tool for analyzing a company's competitive environment is Porter's Five Forces Framework. It uses industrial organization economics to extract five forces that control the level of competition and, consequently, the profitability of an industry.

Five Forces in Porter the competition's model

  • The threat of brand-new competitors.
  • The threat of using different goods or services.
  • supplier bargaining strength.
  • Buyer bargaining strength.
  • The rivalry between contemporary rivals.

The goal of Porter's Five Forces Model is to assess a market, or business sector potential's for profit. According to Michael Porter, there are five forces that have the ability to affect each business sector.

To know more about Michael Porter refer to: brainly.com/question/13007758

#SPJ4

4 0
2 years ago
Retained earnings is: Multiple Choice The positive cash flows of a company. The net worth of a company. The owners' equity that
zheka24 [161]

Answer:

The net worth of a company

Explanation:

Retained earnings is what is left of net income after paying out dividends

Retained earnings = beginning of period retained earnings + net income - dividends

7 0
3 years ago
Banning Company uses the allowance method to account for uncollectible receivables. At the beginning of the​ year, Allowance for
In-s [12.5K]

Answer:

The net realizable value of Accounts Receivable at year end is simply $18,100 ($20,600 - $2,500).

Explanation:

When there was a writeoff, the Company would have debited the allowance account to credit accounts receivable to the tune of $2,400. Also, the additional bad debt expense of $3,500 recorded would have been a debit to bad debt expense and credit to the allowance account. These are all events that transpired during the year. <u>Balance in the allowance account is therefore $1,400 - $2,400 + $3,000 = $2,500.</u>

Note that the ending balance of accounts receivable of $20,600 was only given in the question, which means that when the writeoff happened, the accounts receivable would have been reduced during the year. To arrive at the net realizable value, we do not need to consider the writeoff anymore, just simply back out the allowance for doubtful accounts balance from the accounts receivable.

7 0
3 years ago
Other questions:
  • In the market for federal funds, if the federal funds rate is between the discount rate and the interest rate paid on excess res
    12·1 answer
  • Choose an advertisement that you found to be especially memorable. Describe the advertisement and explain how effective it is. D
    7·1 answer
  • PB9.
    12·1 answer
  • What is the effective rate of a $25,000 interest-bearing simple discount 10%, 90-day note?
    11·1 answer
  • Ethan's Eggroll House, a calendar year corporation, purchased a new computer and printer in January for $1,500. In February, the
    9·1 answer
  • A local pharmaceutical firm of Pakistan has decided to restructure its end to end process as per the quality standards of DRAP (
    10·1 answer
  • According to the National Business Ethics survey, if senior management in a company wants to boost or ensure ________ ________,
    13·1 answer
  • Someone answer this!
    12·2 answers
  • When the brazilian real changes from 1000 real per u. s. dollar to 1500 real per u. s. dollar, the real is?
    9·1 answer
  • Two years ago, you bought a property for $264,500. Values increased in that area by 5% the first year and 7% the second year. Ho
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!