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erastovalidia [21]
3 years ago
9

On July 1, 2020, when the market rate of interest was 12%, TTS Corporation issued $100,000 of 10%, 10 year bonds, interest payab

le June 30 and December 31. The bonds were issued at 93. TTS’s fiscal year ends December 31. What is the amount of cash interest paid on December 31, 2020? Select one: a. $10,000 b. None of the above c. $5,000 d. $6,000 e. $12,000
Business
1 answer:
lawyer [7]3 years ago
5 0

Answer:

E) $12,000

Explanation:

the bonds were  issued at a discount for $93,000

the face value $100,0000

coupon rate 12%

even though the bonds were sold at a discount because the coupon rate was lower than the market rate,  the amount of cash paid as interest is based on the face value = $100,0000 x 12% = $12,000

the journal  entry to record the sale of the bonds would be:

Dr Cash 93,000

Dr Discount on bonds payable 7,000

    Cr Bonds payable 100,000

whatever method the company uses  to record interest, the amount of cash paid will  always be the same

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In most transactions, the buyer is accepting the condition of the property at what point in time:_________
Dmitriy789 [7]

Answer:

b. At the signing of the contract

Explanation:

A contract can be defined as an agreement between two or more parties (group of people) which gives rise to a mutual legal obligation or enforceable by law.

Mutual assent is a legal term which represents an agreement by both parties to a contract. When two parties to a contract both have an understanding of the parameters, terms and conditions surrounding a contract, it ultimately implies that they are in agreement; this is generally referred to as mutual assent and it is at this point they (buyer and seller) sign the contract. Therefore, mutual assent connotes agreement, acceptance and consent to a contract by both parties.

<em>Hence, in most transactions, the buyer is accepting the condition of the property at the signing of the contract as an approval or consent to the terms and conditions. </em>

7 0
3 years ago
The Swivel Chair Company manufacturers a standard recliner. During February, the firm's Assembly Department started production o
ivanzaharov [21]

Answer:

54,000 chairs

Explanation:

The computation of the number of chairs at the beginning of the month is shown below:

Inventory at the beginning of the month = Units completed and transferred  + ending inventory units - Units started

= 180,000 chairs + 21,000 chairs - 147,000 chairs

= 54,000 chairs

We simply applied the above formula to find out the inventory at the beginning of the month

7 0
3 years ago
Choose the statement that is correct. A. The MC curve intersects the AFC​, AVC​, and ATC curves at their minimums. B. Initially
shepuryov [24]

Answer: C. The ATC curve eventually slopes upward because average variable cost eventually increases

Explanation:

The Law of Diminishing Marginal Returns causes the Average Total Cost curve to eventually slope upwards because the Average Variable Cost will increase.

Why?

At first, with production increasing, a firm will be very efficient at producing a certain good thereby driving the cost down per unit. As time goes on however, the law of Diminishing Marginal Returns comes into play as more is invested into the business. The cost per unit will therefore rise which will lead to the ATC curve going upwards.

I have included a simple graph to illustrate.

If you need any clarification do react or comment.

3 0
3 years ago
Say's Law argues that a given ____________________ must create an equivalent ________________________ somewhere else in the econ
serg [7]

Based on the economic theory of demand and supply, Say's Law argues that a given "<u>value of supply"</u> must create an equivalent "<u>value of demand</u>" somewhere else in the economy.

This is based on the idea that supply would deduce the size of the macro-economy, which in turn makes sense in the long run.

Jean Baptiste Say is a French economist famous for being an adherent supporter of business competition, free trade, and removing restraints on business activities.

His Say's law was famous as it tried to define the market condition. Say's law is sometimes referred to as the <u>Law of</u> <u>Market</u>.

Hence, in this case, it is concluded that the correct answer is option D. "<u>value of supply; the value of demand."</u>

Learn more here: brainly.com/question/16920124

3 0
3 years ago
Gilberto Company currently manufactures 70,000 units per year of one of its crucial parts. Variable costs are $1.80 per unit, fi
AnnZ [28]

Answer:

The company should continue making the unit. It is cheaper than buying by $7,000.

Explanation:

Giving the following information:

Variable costs are $1.80 per unit

fixed costs= $70,000 per year

Purchasing price per unit= $2.90

<u>I will assume that the fixed costs (not allocated) are avoidable.</u>

First, we need to calculate the total cost of making the unit:

Total cost= 70,000*1.8 + 70,000= $196,000

<u>Buying:</u>

Total cost= 70,000*2.9= $203,000

The company should continue making the unit. It is cheaper than buying by $7,000.

7 0
3 years ago
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