Answer:
$92,054
Explanation:
The computation of the gross income is shown below:
= Wages earned + interest received from a savings account
= $87,240 + $4,814
= $92,054
We simply added the wages earned and the interest received from a savings account so that the accurate amount can come i.e gross income
All other information which is given is not relevant. Hence, ignored it
Answer:
journal entries are as given below
Explanation:
solution
journal entries are as
first we get here investment by Moss
date account title debit credit
January 01 cash $17500
equipment $82500
note payable $25000
Angela Moss capital $75000
and now we get investment by barber
date account title debit credit
January 01 cash $31250
autumn barber capital $31250
Explanation:
Your Credit History
Your Ability To Pay The Loan
Your Cash Flow History
Answer:
D. Home made Leverage
Explanation:
Home made leverage is a situation in which an investor utilizes borrowed funds to artificially adjust or change the level of leverage of a company. An Home made leverage can be used to turn an unleveraged company to a leveraged one.
One of the terms of home made leverages, however, is that, the investor who is borrowing to make a company leveraged must be able to borrow at the same borrowing cost of the firm.
Reason for Using Home Made Leverage
One of the main reasons is as stated in the question, which is to replicate a corporation's capital structure.
According to Modigliani-Miller theorem, however, the home made leverage will only work smoothly for an investor as long as taxes and bankruptcy costs are absent and the market is efficient. This clause is the reason for the initial clause that home mode leverage works as long as the investor is able to borrow at the same borrowing cost as the firm.
Answer:
BEP units 205,882 pounds
BEP dollars $102,941.17
Explanation:
0.50 - 0.33 = 0.17 contribution per pound
This means each pound generates 0.17 of contribution.
Now, we can calculate the pounds needed to afford the fixed cost.
35,000/0.17 = 205,882.35 pounds
for the BEP we will multiply by the sales price:
205,882.35 pounds x $0.5 = $102,941.17
