Answer:
1 a) + asset , + preferred stock
b) + asset , + preferred stock
c) + assets , + stockholder's equity
d) - and + Asset
e) + -Asset
f) - Equity , + liability
g) - Equity , - Asset
journal entry
a) Debit bank 700000 Credit Preferred stock 700000
b) debit land 420000 , credit preferred stock 420000
c) debit bank 768000 credit stockholder's equity 768000
d) Debit investment 270000 credit bank 270000
e) Debit bank 189000 , credit investment 189000
f) Debit dividend 19600 credit shareholders for dividends 19600
g) debit dividends 96000 credit bank 96000
Explanation:
dividends preferred = 7000 + 4200 = 11200 * 1 . 75 = 19600
dividends common stock = 48000 * 25 * 8 % = 96000
Answer:C. Damage to completed cars held on a storage lot
Explanation:
Operational risk are the hazards and the uncertainties that are faced by companies in the day to day activities. It may be caused as a result of system failure or manufacturing components.
An example of operational risk for a company that manufactures automobiles would be damage to completed cars held on a storage lot.
Answer:
8.55%
Explanation:
For computing the current yield first we have to determine the present value by applying the present value formula which is shown below:
Given that,
Future value = $1,000
Rate of interest = 8%
NPER = 7 years
PMT = $1,000 × 9% = $90
The formula is shown below:
= -PV(Rate;NPER;PMT;FV;type)
After solving this, the present value is $1,052.06
Now the current yield is
= PMT ÷ PV
= $90 ÷ $1,052.06
= 8.55%
Answer:
option (b) $34,789
Explanation:
Data provided in the question:
Worth of Firm A = $35,000
Incremental value of the acquisition = $2,500
Number of shares of Firm A outstanding = 2,000
Price of Firm A shares = $16 per share
Number of shares of Firm B outstanding = 1,200
Price of Firm B shares = $40 per share
Now,
Number of shares issued = Worth of Firm A ÷ Price per share of Firm B
= $35,000 ÷ $40
= 875 shares
Value per share after merger
= [ (1,200 × $40) + ( 2,000 × $16 ) + $2,500 ] ÷ [ 1,200 + 875 ]
= $82,500 ÷ 2,075
= $39.759
Therefore,
The Actual cost of acquisition
= Number of shares issued × Value per share after merger
= 875 × $39.7588
= $34788.95 ≈ $34,789
Hence,
The answer is option (b) $34,789
Open-ended credit is credit that can be used repeatedly.
Example: A credit card
Close-ended credit is credit that has to be paid in full by a certain date
Example: A house loan (mortgage)
