Answer:
Debit Cash $1,470
Debit Expense - Credit card fee $30
Credit Sales revenue - $1,500
Explanation:
The sales revenue for Appliance world will be $1,500 as this is the gross sale made at point of sale.
- Since, this sale is made via credit card, the credit card fee will be <u>deducted</u> from the sales revenue,
- Difference will be <u>cash received</u> after deducting the credit card fee from sales revenue.
The fee charged by credit card company is the <u>expense</u> for ApplianceWorld:
The fee would be charged at the purchase made by the customer i.e. $1,500×2% = $30
The cash that would be recovered to ApplianceWolrd will be $1,500 - $30 = $1,470 (net of the credit card fee).
<u>Journal entry</u>
Debit (increase) Cash $1,470
Debit (increase) Expense - Credit card fee $30
Credit (increase) sales revenue - $1,500
Answer:
Plese see explanation
Explanation:
1. Net present value of project X
Year Cash flow Present value at 16%
0 (25,000) (25,000)
1-6 8,000 29,477.89
Net present value= $4,477.89
2. Net present value of project Y
Year Cash flow Present value at 16%
0 (25,000) (25,000)
6 60,000 24,626.54
Net present value= ($373.46)
3. I will recommend Labeau Products, Ltd to invest in project X instead of project Y because the net present value of project X is positive and project x will increase the wealth of shareholders of the Labeau Products, Ltd by $4,477.89
Answer:
D
Explanation:
D because you have to keep up with demand
Answer:
A. the present value of the future dividends the company pays.
Explanation:
The net present value (NPV) of a project can be defined as the difference between present value of cash-inflow into a project and that of cash-outflow over a specific period of time. Thus, it is simply the value of all cash-flows for a project with respect to its life span.
The underlying assumption of the dividend discount model is that a stock is worth the present value of the future dividends the company pays.
Generally, all financial assets or securities can be securitized i.e turned into a tradable item that can be used to generate money for a potential investor or the owner of the financial asset.
For example, a mortgage backed security can be used as securitization.
