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2 years ago

What distinguishes open-ended credit from closed-ended credit?

Business

2 answers:

Naily [24]2 years ago

7 0

The main difference is must repay vs doesn’t need to repay.

Explanation:

Closed-end credit is a payment agreement in which the debtor is expected to repay the tax due plus the interest in a particular number of equivalent arrangements, typically on a monthly basis.

Open-ended loan, credit is provided in anticipation of any payment so that the debtor does not have to repay every period the credit is demanded.

Car and ship loans are prominent examples of closed-end loans. On the other side, open-ended loans, such as credit card payments, can have the amount owed up and down as the creditor takes money against the line of credit.

KiRa [710]2 years ago

6 0

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)

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Accounts that are increased with a debit include A : revenue. B : assets. C : equity. D : liability.

Akimi4 [234]

Answer:

B : assets.

Explanation:

As we know that

The debit side records the expenses, assets, and losses plus there is always a debit balance. If there is an increase in these above accounts than it also contains a debit balance

While the credit side records the revenues, gains, liabilities, and the stockholder equity. If there is an increase in these above accounts than it also contains a credit balance

3 0

3 years ago

The 5.3 percent bond of Dominic Cyle Parts has a face value of $1,000, a maturity of 12 years, semiannual interest payments, and

givi [52]

Answer:

$936.17

Explanation:

The current market price of the bond = present value of all coupon received + present value of face value on maturity date

The discount rate in all calculation is YTM (6.12%), and its semiannual rate is 3.06%

Coupon to received semiannual = 5.3%/2*$1000= $26.5

We can either calculate PV manually or use formula PV in excel to calculate present value:

Manually:

PV of all coupon received semiannual = 26.5/(1+3.06)^1 + 26.5/(1+3.06)^2....+ 26.5/(1+3.06)^24 = $445.9

PV of of face value on maturity date = 1000/(1+6.12%)^12 = $490.27

In excel:

PV of all coupon received semiannual = PV(3.06%,24,-$26.5) = $445.9

PV of of face value on maturity date = PV(6.12%,12,-$1000) = 1000/(1+6.12%)^12 = $490.27

The current market price of the bond = $445.9 + $490.27 = $936.17

Please excel calculation attached

Download xlsx

7 0

3 years ago

List three examples of coverage provided by employers for employees.

hichkok12 [17]

Medical, Disability, and Life Insurances

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3 years ago

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In this blank graph of the business cycle, what does the red circled area on the grap

serg [7]

Answer:It is contraction

Explanation:It is at the smallest point

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3 years ago

January 1, Biden, Inc.'s WorkminusinminusProcess Inventory account had a balance of $ 30 comma 800. During the year, $ 58 com

Natasha_Volkova [10]

Answer:

Option (A) is correct.

Explanation:

Given that,

Direct materials = $58,500

Direct labor = $66,000

Manufacturing overhead = 120% of direct labor cost

Opening WIP = $30,800

Cost of goods manufactured:

= Direct materials + Direct labor + Manufacturing overhead

= $58,500 + $66,000 + 120% of direct labor cost

= $58,500 + $66,000 + (120% × $66,000)

= $58,500 + $66,000 + $79,200

= $203,700

December 31 balance of Work-in-Process Inventory:

= Opening WIP + cost of goods manufactured - cost of goods completed

= $30,800 + $203,700 - $220,700

= $13,800

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3 years ago