Answer and Explanation:
The computation of the return on investment is shown below:
For location A, it is
= $80,000 ÷ $500,000
= 16%
And, for location B it is
= $44,000 ÷ $200,000
= 23%
On the basis of the return on investment, the company should prefer for location B as it contains high return on investment
Therefore the same is to be considered
Answer:
The answer is: Knottworth Gedding should report $1,725,000 as interest expense in its 12/31/2021 income statement
Explanation:
The formula for calculating the amount of interest expense is:
interest expense = discount rate x (present value - yearly payment) x time
- Discount rate = 10%
- Present value = $40,500,000
- Yearly payment = $6,000,000
- Time = 6 months / 12 months = 0.5
interest expense = 10% x ($40,500,000 - $6,000,000) x 0.5 = $1,725,000
Answer:
A)If interest rates decline, the prices of both bonds will increase, but the 15-year bond would have a larger percentage increase in price.
TRUE
As it has more time to maturity it will have a higher time expose to the rate therefore, will be more volatile against the rate fluctuations
Explanation:
The 10-year ond is issued at premium, above par as the coupon rate 12% is higher than market rate 10%. Each year will decrease the market value to come closer to maturity date.
The 15-year ond is issued at discount, below par as the coupon rate 8% is lower than market rate 10%. Each year will increase the market value to come closer to maturity date.
That would be 10%...........giving dots because i need 20 characters for my answer lol