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Elena-2011 [213]
3 years ago
7

In ascertaining whether a borrower has the ability to pay off his loan over time, a mortgage bank may rely on calculating a tota

l debt ratio as part of its underwriting process. Utilizing the following information, calculate the total debt ratio. Monthly principal and interest on mortgage loan: $635, Monthly Tax and insurance payments into escrow: $125, Monthly Car lease payment (lease term is 3 years): $350, Gross monthly income: $2,500
A. 25.4%
B. 30.4%
C. 44.4%
D. 53.2%
Business
1 answer:
Paha777 [63]3 years ago
8 0

Answer:

Total debt ratio will be 44 %

So option (c) will be the correct option

Explanation:

We have given monthly principal and interest on mortgage loan = $635

Monthly Tax and insurance payments = $125

Car lease payment = $350

Now total monthly obligations = $625+$125+$350 = $1100

Gross monthly income = $2500

We have to find the total debt ratio

We know that total debt ratio is given by

Debt ratio =\frac{total\ obligation}{total\ income}=\frac{$1100}{$2500}=0.44=44%

So option (c) will be the correct option

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The buyers purchased a residence for $195,000. They made a down payment of $25,000 and agreed to assume the seller's existing mo
Phoenix [80]

Answer:

Option (d) purchase-money mortgage

Explanation:

Option (d) purchase-money mortgage

A purchase-money mortgage is a sort of mortgage issued to the customer or buyer of the property, in which the owner or the seller of the property himself lends the load to the buyer to buy the property.

This type of condition arises usually when the buyer is not able to get the loan from the traditional channels like the bank due to various reasons.

6 0
3 years ago
On July 1, 2021, Apache Company, a real estate developer, sold a parcel of land to a construction company for $3,000,000. The bo
atroni [7]

Answer:

Revenue 2021 = $3,000,000

Revenue 2022 = $0

Explanation:

Given that,

Sold a parcel of land to a construction company = $3,000,000

book value of the land on Apache’s books = $1,200,000

In this case, revenue is identified at a point when the parcel of land is transferred to the construction company.

Therefore, full revenue from the sale of land should be recognized in the year 2021 because the transfer of land occured in 2021 and there will be no revenue reflected in the year 2022.

Revenue 2021 = $3,000,000

Revenue 2022 = $0

4 0
3 years ago
Crowl Corporation is investigating automating a process by purchasing a machine for $793,800 that would have a 9-year useful lif
Vsevolod [243]

Answer:

Simple rate of return is 5.8%

Therefore option (a) is correct option.

Explanation:

It is given that purchase cost = $793800

Company saving per year = $133000

Yielding = $21200

Annual depreciation = $88200

Annual profit = $133000 - $88200 = $44800

Net investment is equal to = $793800 - $21200 = $772600

Simple rate of return =\frac{44800}{772600}=0.0579

= 5.8%

Therefore simple rate of return is 5.8 %

So option (a) is correct.

6 0
3 years ago
Silver Corporation, which operates a department store, sells a television to a store employee for $300. The regular customer pri
tatuchka [14]

Answer:

$75

Explanation:

Calculation to determine How much must the employee include in income from both these transactions in total

Customer price for property $500

Less: Gross profit (25%*$500) ($125)

($500-$125=$375)

Employee price ($300)

INCOME $75

($375-$300)

Customer price for service $150

Less: (20%*$150)max exclusion (30)

($150-$30=$120)

Employee price 120

INCOME 0

($120-$120=$0)

Therefore the amount that the employee must include in income from both these transactions in total is $75

8 0
2 years ago
Colil Computer​ Systems, Inc., manufactures printer circuit cards. All direct materials are added at the inception of the produc
Natasha2012 [34]

Answer:

D. $246,000

Explanation:

As per the given question the solution of direct material cost assigned to good units​ completed is provided below:-

To reach Cost transferred out we need to follow some steps which is following below:-

Step 1. Cost per unit = cost of material used ÷ Units started

= $300,000 ÷ 12,500

= $24

Now,

Step 2. Goods units completed = Started units × Cost per unit

= 6,250 × $24

= $150,000

Step 3. Normal spoilage = Cards units × Cost per unit

= 4,000 × $24

= $96,000

and finally

Cost transferred out = Goods units completed + Normal spoilage

= $150,000 + $96,000

= $246,000

To reach allocation of Cost transferred out we simply put the values into formula.

7 0
3 years ago
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