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hichkok12 [17]
2 years ago
10

On September 1, Year 1 Western Company loaned $36,000 cash to Eastern Company. The one-year note carried a 5% rate of interest.

The amount of interest revenue on the income statement and the amount of cash flow from operating activities shown on Western’s December 31, Year 1 financial statements would be
A.$600 interest revenue and $1,800 cash flow from operating activities.
B.$1,200 interest revenue and $1,800 cash flow from operating activities.
C.$600 interest revenue and zero cash flow from operating activities.
D.$1,200 interest revenue and zero cash flow from operating activities.
Business
1 answer:
alukav5142 [94]2 years ago
8 0

Answer:

Option (C) is correct.

Explanation:

Given that,

Cash amount loaned = $36,000

Rate of interest on note = 5%

Time period: From September 1, Year 1 to December 31, Year 1 = 4 months

Amount of Interest revenue:

= Cash amount loaned × Interest rate × Time period

= $36,000 × 0.05 × (4/12)

= $36,000 × 0.05 × (1/3)

= $599.9 or $600

There is no cash flow from operating activity in respect of loan given to another company and interest revenue accrued on loan amount.

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U-1 is a more____
Lady bird [3.3K]

Answer:

B. narrow, have been unemployed for 15 weeks or more weeks.

Explanation:

Unemployment rate refers to the percentage of the total labor force in an economy, who are unemployed but seeking to be gainfully employed. The unemployment rate is divided into various types, these include;

I. Natural Rate of Unemployment (NU).

II. Frictional unemployment rate (FU).

III. Structural unemployment rate (SU).

IV. Actual unemployment rate (AU).

V. Cyclical unemployment rate (CU).

There are different measures used in the measurement of the unemployment rate in a country's economy and these includes;

I. U-1: this is the percentage of people that are unemployed for at least 15 weeks or more.

II. U-2: this is the percentage of the people who have lost their job or the people that finished a temporary job.

U-1 is a more narrow measure of unemployment rate than the conventional U-3 measure and U-1 counts as unemployed workers who have been unemployed for 15 weeks or more weeks.

5 0
2 years ago
Starling Co. manufactures one product with a selling price of $18 and variable cost of $12. Starling’s total annual fixed costs
nikitadnepr [17]

The number of units that Starling Co. sold was 11200

<u>Explanation:</u>

Given -

Operating income = $28,800

Fixed cost = $38,400

Selling price of one unit = $12

Variable cost = $12

Number of units sold, n = ?

Contribution  margin per unit = $18 - $12

                                                 = $6

n = \frac{operating income + fixed cost}{contribution margin per unit}

n = \frac{28800 + 38400}{6} \\\\n = \frac{67200}{6} \\\\n = 11200

Therefore, number of units that Starling Co. sold was 11200

7 0
3 years ago
When preparing a journal entry for a transaction that affects retained earnings, the "Retained Earnings" account should not be d
yarga [219]

Answer:

True

Explanation:

Retained earnings are the net earnings of an entity accumulated over time after payment of dividend. It is that part of earnings that is retain for expansion by the entity.

Generally, retained earnings are not changed by direct posting except it is prior year adjustment. in some entities, the amount that is transferred to retained earnings is system generated. Most transactions that affect retained earnings are debited or credited to account which ultimately affects retained earnings

4 0
3 years ago
AA Corp can lease a truck for four years at a cost of $25,000
erica [24]

______________________________

<h3>LEASING:</h3><h3>= $25,000 × 4 Years</h3><h3>= $100,000</h3><h3>= 10% × $25,000 ÷ 100 - $25,000</h3><h3>= $22,500 × 4 Years</h3><h3>= <u>$90,000</u></h3><h3 /><h3>BUYING:</h3><h3>= $60,000 + $40,000</h3><h3>= $100,000</h3><h3>= 10% × $10,000 ÷ 100 - $10,000</h3><h3>= $9,000 × 4 Years</h3><h3>= $36,000 + $60,000</h3><h3>= <u>$</u><u>9</u><u>6</u><u>,000</u></h3>

<h3>LEASING IS A BETTER OPTION</h3>

______________________________

3 0
2 years ago
A difference between a perfectly competitive market equilibrium and a perfect price discrimination equilibrium is that in a comp
svp [43]

Answer:

A difference between a perfectly competitive market equilibrium and a perfect price discrimination equilibrium is that in a competitive market <u>marginal cost equals marginal revenue</u>, whereas in perfect price discrimination <u>marginal cost does not equal marginal revenue.</u>

Explanation:

In a perfectly competitive market, equilibrium is only possible when marginal revenue equals marginal cost and marginal revenue curve is cut by the marginal cost curve from below.

Contrariwise, in a perfect discrimination, equilibrium is achieved irrespective of the nature of marginal cost; whether rising, constant or falling.

3 0
3 years ago
Read 2 more answers
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