Answer:
a) Journal entry
Date Account and explanation Debit Credit
June 1 Cash $108,000
Notes payable $108,000
b) Adjusting entry
Date Account and explanation Debit Credit
June 30 Interest expense $360
(108,000*4%*1/12)
Interest payable $360
c) Journal entry
Date Account and explanation Debit Credit
Dec 10 Notes payable $108,000
Interest payable (360*6) $2,160
Cash $110,160
d) Total (interest expenses)
Interest payable = $360 * 6
= $2160
As a boat operator, the law make it mandatory that you should stop and assist other boaters who are involves in accidents if there is no danger to you, your passengers or your boat. People who render assistance at boat accident scenes are not hold liable for any civil damage because of the assistance they render.
Answer:
The carrying value decreases from the issue price to the par value over the bond’s term.
Explanation:
The carrying value of a bond is the par value or face value of that bond plus any unamortized premiums or less any unamortized discounts. The net amount between the par value and the premium or discount is called the carrying value because it is reported on the balance sheet. When a bond is issued at a premium, the carrying value is higher than the face value of the bond.
Answer: 14%
Explanation:
We can calculate this using the Gordon Growth Model which looks like this,
P = D1 / r - g
P is the current stock price
D1 is the next dividend
r is the rate of return or the cost of capital
g is the growth rate.
We have all those figures except the cost of capital so making r the subject of the formula we can solve for it. Doing that will make the formula,
r = D/ P + g
r = 1.55 / 22.10 + 0.07
r = 0.1401
r = 14%
14% is the equity cost of capital.
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