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ikadub [295]
3 years ago
11

A company purchased a two-year fire insurance policy on May 1, 2012. It paid the $2,400 premium in cash on the same date and rec

orded the entry with a debit to Prepaid Insurance for $2,400. The company has adopted a 12-month accounting period ending on January 31 of each year. If the company uses the accrual basis of accounting, how much insurance expense will be recorded for the periods ended January 31, 2013, and January 31, 2014, respectively
Business
1 answer:
Yuliya22 [10]3 years ago
6 0

Answer:

The insurance expense to be recorded for period ended 31 January 2013 is $900

The insurance expense to be recorded for period ended 31 January 2014 is $1200

Explanation:

From the date of insurance premium payment till 31 January 2013 gives a period of nine months, which means that nine months of insurance premium should be recognized as expense in that period.

January 31 2013 insurance expense=$2400*9/12

                                                            =$900

From February 1 2013 till  January 31 2014, gives a complete year, which means 12-month insurance premium should be recognized in that period,hence the below calculation:

January 31 2014 insurance expense=$2400*12/24

                                                             =$1200

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8 0
3 years ago
you borrowed $4 from your roomate to buy backup calculator batteries on the way to the exam. the next day, you repaid the $4 plu
LiRa [457]

Answer:

0.2840 or 28.40%

Explanation:

The formula for EAR= (1 + i/n)^n - 1

Where i= stated interest rate

n= number of compounding periods

In this case since the interest he paid is 1 cent, to convert it into percentage, we divide it by the dollar and multiply by 100

Note: 100 cent = 1 dollar

Therefore 4 dollars= 400 cents

To get the Interest rates= 1/400 x 100

= 0.25

n= 365 since we are computing daily

(1 + 0.25/365)^365 - 1

(1 + 0.000685)^365 - 1

(1.000685)^365 - 1

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3 0
3 years ago
Which of the following is likely to lead to an increase in the GDP of a​ country? A. An increase in the interest rates in the co
Triss [41]

Answer:

B. An increase in the physical capital stock of the country 

Explanation:

Gross domestic product is the sum of all final goods and services produced in an economy within a given period which is usually a year.

GDP calculated using the expenditure approach = Consumption spending + Investment spending + Government Spending + Net Export

If physical capital stock is increasing, it means investment spending is increasing and gdp would rise.

Increase in tax rate reduces disposable income which leads to a fall in consumption and gdp.

An increase in interest rate leads to a fall in investment and gdp.

If unemployment is high, gdp would be low.

I hope my answer helps you

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4 years ago
g An investor wants to be able to buy 4% more goods and services in the future in order to induce her to invest today. During th
Hitman42 [59]

Answer: a. I, II and III are true

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III. 2% is the expected inflation rate over the period.

4% is the desired real rate of interest because that's the rate at which the investor is willing to buy the goods in future.

2% is the expected inflation rate over the period because at that rate, there's expectation of future rise in price while 6% is the approximate nominal rate of interest required which is the addition of the 4% and the 2%.

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3 years ago
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