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3 years ago

The following items are components of a traditional Balance Sheet. How much are the total assets of the firm?

Business

1 answer:

Anestetic [448]3 years ago

6 0

Answer:

$ 59,000

Explanation:

The total Asset is compounded of:

Plant and Equipment $42,000

Cash $ 8,000

Inventory $21,000

Allowance for Uncollectable Accounts $ 6,000 ( negative, netting Accounts Receivables )

Accumulated Depreciation $28,000 ( negative, netting Plant and Equipment )

Accounts Receivable $22,000

Assets ( Net ) : $ 59,000

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Scotch Inc. arranged a $7,000,000 revolving credit agreement with a group of banks. The firm paid an annual commitment fee of 0.

baherus [9]

Answer:

$575,000

Explanation:

Data provided:

The total amount for the credit agreement = $7,000,000

The amount borrowed by the firm = $6,000,000

The annual commitment fee for the unused balance = 0.5%

Prime rate of interest = 8%

Interest paid above the prime rate = 1.5%

Now,

the unused amount = $7,000,000 - $6,000,000 = $1,000,000

The amount of commitment fees paid

= total unused amount × Annual commitment fees

= $1,000,000 × 0.005

= $5000

Total interest paid on the borrowed amount

= Amount borrowed × (prime rate + additional rate)

= $6,000,000 × ( 0.08 + 0.015)

= $6,000,000 × 0.095

= $570,000

Hence,

the total dollar annual cost of the revolver

= interest paid on the borrowed amount + amount of commitment fees paid

= $570,000 + $5000

= $575,000

4 0

3 years ago

Time Remaining 1 minute 56 seconds00:01:56 Item 1Item 1 Time Remaining 1 minute 56 seconds00:01:56 You Save Bank has a unique ac

Amanda [17]

Answer:

Future value = 16007.81437

Explanation:

we have to compound all the rates for the time period together as the 7,750 as exposed to this rate and their interest generated in one period are taking into consideration for the subsequent period interest calculations.

$7,750 (1.06)^3(1.066)^2(1.073)^6 = FV$

We multiply them and get the future value factor:

$7,750 \times 2.065524435 = FV$

we now can solve for future value:

Future value = 16007.81437

6 0

3 years ago

The statement of cash flows (indirect method) reports depreciation expense as an addition to net income because depreciation

dalvyx [7]

Answer: B. reduces reported net income of the period but does not involve an outflow of cash for that period.

Explanation:

Depreciation is the wear and tear of an asset due to the use of the asset. When an asset is depreciated, such an asset is eventually sold at a scrap value.

The statement of cash flows (indirect method) reports depreciation expense as an addition to net income because depreciation reduces reported net income of the period but does not involve an outflow of cash for that period.

5 0

3 years ago

Calculate the values for each of the questions. Assume that in each country there are no taxes, international trade, or inflatio

Inessa [10]

Explanation:

a. The computation is shown below:

As we know that

Multiplier = 1 ÷ 1 - MPC

1.5 = 1 ÷ 1 - MPC

So, MPC is 0.3333

Now the real GDP is

= Multiplier × Government spending

= 0.3333 × $70 billion

= $105 million

So the change in real GDP is

= $105 million - $70 million

= $35 million

b. The computation is shown below:

As we know that

Multiplier = 1 ÷ 1 - MPC

Multiplier = 1 ÷ 1 - 0.6

So, multiplier is 2.5

Now the real GDP is

= Multiplier × Government spending

= 2.5 × $16 billion

= -$40 million

c. As we know that

Real GDP = Multiplier × Government spending

$280 billion = Multiplier × $70 billion

So, the multiplier is 4

Now the MPC is

Multiplier = 1 ÷ 1 - MPC

4 = 1 ÷ 1 - MPC

So, the multiplier is 0.75

3 0

3 years ago

9. Mackenzie PLC is considering expanding a production line. The new equipment for the line will cost $255,000. In addition, the

NNADVOKAT [17]

Answer:

Net Present Value = $59,632.78

Explanation:

The net present value NPV) of a project is the present value of cash inflow less the present value of cash outflow of the project.

NPV = PV of cash inflow - PV of cash outflow 

Present value of cash inflow:

65,000 × (1.09375)^(-1) + 98000 ×(1.09375)^(-2)+ 126,000 ×(1.09375)^(-3)+ 132,000 × (1.09375)^(-4)= 326882.7792

PV of annual maintenance cost :

=1,500 × (1- 1.09375^(-4))/0.09375

=4819.84773

NPV = 26882.7792 - 4819.84773 - (255,000+12250)

= 59,632.78

8 0

3 years ago