Answer:
loan interest revenue for 2020 is $720
loan interest revenue for 2021 is $240
Explanation:
The loan interest revenue in the year 2020 is for 9 months out of the total loan tenure of twelve months:
interest revenue for 2020=$16,000*6%*9/12=$720.00
This would be debited to interest receivable and credited to interest revenue account.
interest revenue for 2021=$16,000*6%*3/12=$240.00
Answer:
simple interest
Explanation:
Simple interest is the amount of money that an investment earns during 1 given period, it is calculated by multiplying the principal amount of the investment by the interest rate = $4,000 x 4% = $160
On the other hand, compound interest is interest that gains more interest by itself. This means that the interest gained during a given period, will gain more interest itself for the next period. It is calculated using the following formula = principal amount x (1 + interest rate)ⁿ, where n is the number of periods.
Answer:
$20,800,000
Explanation:
The formula and computation is shown below:
Value of the firm = {(Firm's current profits) × (1 + firm’s opportunity cost of funds)} ÷ (firm’s opportunity cost of funds - constant growth annual rate)
= {($400,000) × (1 + 0.06) ÷ (0.06 - 0.04)
= $424,000 ÷ 0.02
= $21,200,000
Hence, we recognized all the information which is mentioned in the question.
Answer:
$213,250
Explanation:
The calculation of cash inflow is shown below:-
Expected cash collections
For the month of June
Months Sales Percentage Expected collections
April $282,500 5% $14,125
May $213,750 30% $64,125
June $225,000 60% $135,000
Total collection in the month of June $213,250
Here we assume Sales for April$282,500, May $213,750 and June $225,000.
Please ignore the last value as it is not relevant to the question
Answer:
It is convenient to make the changes.
Explanation:
Giving the following information:
Selling price= $57.60 per unit.
Direct materials= $22
Direct labor= $24
Variable overhead= $11.00
Fixed overhead= $11.00.
New costs:
Direct material cost= 22*1.2= $26.4
Direct labor cost= 24*1.2= $28.8
<u>I suppose that the selling price will increase by $40.</u>
To determine whether the changes increase profit or not, we need to calculate the unitary contribution margin per unit for both options:
Contribution margin= selling price - unitary variable cost
Actual Contribution margin:
Contribution margin= 57.6 - (22 - 24 - 11)= 0.6
New contribution margin:
Contribution margin= 97.60 - (26.4 - 28.8 - 11)= $31.4