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3 years ago

When bonds are issued at a premium, the total interest cost of the bonds over the life of the bonds is equal to the amount of

Business

1 answer:

borishaifa [10]3 years ago

8 0

Answer:

c. interest paid over the life of the bond minus the amount of premium at sale

point.

Explanation:

when bonds are issued at premium the total interest cost of the bonds over the life of the bonds is equal to the amount of interest paid over the life of the bond minus the amount of premium at sale point.

From below journal entry you can see that, When interest payment is made cash is credited full amount but interest is debited after deducting amortised premium.

Journal entry if bonds are issued at premium

cash xx

Bonds Payable xx

Premium on bonds payable

Interest Expense xx

Preminum on bonds payable xx

cash xx

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Fama’s Llamas has a WACC of 9.7 percent. The company’s cost of equity is 12 percent, and its pretax cost of debt is 7.5 percent.

Bezzdna [24]

Answer:

0.4766

Explanation:

Given:

WACC = 9.7%

Company’s cost of equity = 12%

Pretax cost of debt = 7.5%

Tax rate = 35%

Now,

WACC

= Weight × Cost of equity + (1 - weight) × Pretax cost of debt × (1-tax rate)

0.097 = weight × 0.12 + ( 1 - weight ) × 0.075 × (1 - 0.35)

0.097 = 0.12 × weight + 0.04875 - 0.04875 × weight

0.04825 = 0.07125 × weight

weight = 0.6772

also,

weight = $\frac{\textup{Equity}}{\textup{Debt + Equity}}$

$\frac{\textup{1}}{\textup{weight}}$ = $\frac{\textup{Debt+equity}}{\textup{Equity}}$

$\frac{1}{0.6772}$ = $\frac{\textup{Debt}}{\textup{Equity}}$ + 1

1.4766 = $\frac{\textup{Debt}}{\textup{Equity}}$ + 1

$\frac{\textup{Debt}}{\textup{Equity}}$ = 0.4766

5 0

4 years ago

The Truth-in-Lending Act gives debtors the right to rescind certain transactions for a period of ______ business days from the d

inysia [295]

Answer:

three

Explanation:

The Truth-in-Lending Act (TILA) applies to home loans. It requires lenders to disclose all costs related to a home loan, provides rescission rights for some transactions, and impose restrictions on home equity credits. But the TILA cannot set the interest rates or other fees charged by the lender, it only requires the lender to disclose the complete information, e.g. APR, monthly payments and amount financed.

3 0

4 years ago

Perdue Company purchased equipment on April 1, 2014, for $270,000. The equipment was expected to have a useful life of three yea

otez555 [7]

Answer:

Straight line:

2014 $ 65,250

2015 $ 87,000

2016 $ 87,000

2017 $ 21,750

units-of-output method:

2014 $ 108,750

2015 $ 79,750

2016 $ 58,000

2017 $ 14,500

dobule declining method

2014 135,000

2015 45,000

2016 15,000

2017 9,000

Explanation:

Straight line:

(cost - salvage value) / useful life

(270,000 - 9,000)/3 = 87,000 per complete year

First year: from April 1st to December 31th

87,000 x 9/12 = 65,250

Second and third year are complete year thus, 87,000

fourth year: from Jan 1st to March 31th:

87,000 x 3/12 = 21,750

units-of-output method:

(cost - salvage value) / unit of output

261,000 / 18,000 = 14.5 per hour

We multiply each year hours by this rate

7,500 x 14.5 = 108,750

5,500x 14.5 = 79,750

4,000x 14.5 = 58,000

1,000 x 14.5 = 14,500

double declining

we multiply by twice the rate of of straight line:

1/3 x 2 = 2/3 we depreciate this amount of the carrying vbalue per year

Last year we adjust to obtain the residual value

Year Beginning Rate Dep expense Carrying value

2014 270,000 0.50 135,000 135,000

2015 135,000 0.67 90,000 45,000

2016 45,000 0.67 30,000 15,000

2017 15,000 6,000 9,000

5 0

3 years ago

In a _______ organization lower-level managers are empowered to make decisions which can ________ motivation and job satisfactio

cupoosta [38]

Answer:

The correct answer is B

Explanation:

Decentralized is the process in which the power, functions are distributed or dispersed from the central location or authority to the lower level of the management.

So, in a organization or company which is decentralized where lower level managers are empowered for taking a decision leads to increase in the motivation as well as the job satisfaction of the employees.

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3 years ago

Evaluates the difference between leadership and board governance in establishing strategic planning for a health care organizati

hodyreva [135]

This white paper evaluates the difference between leadership and board leadership in creating strategic plans for healthcare organizations.

Leadership and governance includes ensuring a strategic policy framework that combines effective oversight, partnership building, regulation, attention to system design and accountability.

The Board's role in strategic planning includes identifying priorities, setting goals and objectives, allocating resources, and allocating funds to support decisions that need to be made in relation to the strategic plan. increase. The board is also responsible for overseeing the execution of the strategic plan.

Successful leadership and management must scan, focus, coordinate/move rapidly, inspire, plan, organize, implement, measure and evaluate.

Learn more about board governance at

brainly.com/question/13503182

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2 years ago