Answer:
When a company uses the straight line amortization of bond premiums, the total amount of interest expense will be equal to the expense calculated using the effective interest method.
The advantage of using the straight line amortization is that it is a much simpler method. Under this method, the bond's premium is amortized over the life of the bond.
Answer:
$31,800
Explanation:
All Non Manufacturing expenses are treated as Period costs. Period Costs are expensed in Income Statement.
<u>Calculation of Total Period Costs</u>
Sales commissions expense $15,600
Administrative office supplies $7,300
Administrative Office salaries expense $8,900
Total $31,800
Conclusion
The total costs that will be expensed when incurred on the income statement for the period is $31,800.
<span>a. a promotion-related ethical issue has been created.</span>
Answer:
c. 1.50%
Explanation:
The Hardwig, Inc is considering to pursue a relaxed or restricted current asset investment. We need to calculate the ROE for both the situations. The Net income in the both situation will be;
EBIT - Interest expense - Tax expense = Net Income
Restricted situation = $150,000 - 72,000 - 31,200 = $46,800
Relaxed situation = $150,000 - 81,818 - 27,273 = $40,909
ROE = Net income / equity
Relaxed situation = $40,909 / $818,180 = 5.00%
Restricted situation = $46,800 / $720,000 = 6.50%
The difference between both ROE = 1.50%
Answer:
May 5
Merchandise Inventory $6,000 (debit)
Freight Charges $100 (debit)
Accounts Payable : Archie Co. $6,000 (credit)
Cash $100 (credit)
May 12
Accounts Payable : Archie Co. $2,500 (debit)
Merchandise Inventory $2,500 (credit))
May 14
Accounts Payable : Archie Co. $3,500 (debit)
Discount Received $70 (credit)
Cash $3,430 (credit)
Explanation:
May 5
Recognize the Assets of Merchandise and a Liability : Accounts Payable : Archie Co. as a result of purchase.
Also Recognize the Freight Expenses since this is a F.O.B delivery
May 12
De-recognize the Liability : Accounts Payable - Archie Co. and the Merchandise Inventory asset to the extend of Merchandise returned to Archie Co.
May 14
De-recognize the Liability : Accounts Payable : Archie Co. of $3,500 and the Cash assets to the extend of Payment made to Archie Co less cash discount of $3,430 .
