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Brums [2.3K]
2 years ago
13

On November 1, 2017, Austin Services issued $305,000 of five-year bonds with a stated rate of 12%. The bonds were issued at par,

and Austin makes semiannual payments on April 30 and October 31. On December 31, 2017, Austin made an adjusting entry to accrue interest at year-end. No further entries were made until April 30, 2018, when the first payment was made. What amount of interest expense was recorded for the period of January 1 to April 30, 2018
Business
1 answer:
sergiy2304 [10]2 years ago
8 0

Answer:

$12,200

Explanation:

Calculation to determine the amount of interest expense was recorded for the period of January 1 to April 30, 2018

Interest expense=$305,000*12%*4/12

Interest expense=$12,200

Therefore the amount of interest expense was recorded for the period of January 1 to April 30, 2018 is $12,200

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The government of Happyland collects $100 million in taxes each year and currently has a public debt of $1.2 billion, which it f
DanielleElmas [232]

Answer:

No, the debt is not manageable because interest payments equal $96 million per year.

Explanation:

Annual interest payment for debt = 0.08*1.2B = $96 million

Only the interest payment is about 96% of government revenue, so its not manageable.

5 0
3 years ago
Piazza, a pedestrian, was injured when struck by a vehicle driven by Delaney, who ran a stop sign. At the time of the accident,
Ghella [55]

Answer:

Piazza should sue DGA Corporation because he (or she?) was struck by a company vehicle and the driver was acting within the scope of his normal employment tasks. Piazza might also sue Delaney along with DGA, since DGA is a small corporation and as a corporation is considered a separate legal entity whose shareholder equity might be really low.  

Piazza can sue for compensatory damages including pain and suffering, medical bills and lost wages.

6 0
3 years ago
A bank loans money at an annual rate of 20 percent. Interest is compounded daily. What is the actual rate the bank is charging?
NeX [460]

Answer:

22.13%

Explanation:

The effective annual rate formula below can be used to determine the actual rate charged by the bank as follows:

Effective annual rate=(1+APR/n)^n-1

APR=20%

n=number of times interest is computed yearly=365

Effective annual rate=(1+20%/365)^365-1

Effective annual rate=1.221335858 -1

Effective annual rate=22.13%

The actual rate of interest on bank loan is 22.13%

8 0
3 years ago
American Food Services, Inc., acquired a packaging machine from Barton and Barton Corporation. Barton and Barton completed const
galben [10]

Answer and Explanation:

1. The Journal entry is shown below:-

Equipment Dr,  $4 million

         To Notes payable $4 million

(Being purchase of machine is recorded)

2. The preparation of amortization schedule for the four-year term of the installment note is shown below:-

Present value annuity factor for 10% for 4 years = 3.16987    

Note amount = $4,000,000    

Annuity value = $1,261,881

($4,000,000 ÷ 3.16987)

                    A              B = (A × 10%)      C            D = (C - B)       E = (A - D)

Dec 31   Opening value Effective  Installment Reduction in Ending value

                  of Note           Interest     Paid          value of note       of note

2021     $4,000,000     $400,000  $1,261,881   $861,881         $3,138,119

2022     $3,138,119        $313,812    $1,261,881   $948,069       $2,190,050

2023     $2,190,050      $219,005   $1,261,881   $1,042,876     $1,147,174

2024     $1,147,174         $114,707     $1,261,881    $1,147,174        $0

3. The Journal entry to record the first installment is shown below:-

Interest expense Dr, $400,000

Long term note payable Dr, $861,881

       To Cash $1,261,881

(Being the first installment paid is recorded)

4. The Journal entry to record the third installment is shown below:-

Interest expense Dr, $219,005    

Long term note payable Dr, $1,042,876    

        To Cash $1,261,881  

(Being third installment paid is recorded)

6 0
3 years ago
One implication of goal-setting theory is that goals should be: set by top management. relatively easy to achieve. set at a leve
slavikrds [6]

Answer:

set through a process that involves all persons responsible for formulating and implementing the goals.

Explanation:

Goal setting theory states that when there are specific and challenging goals along with appropriate feedback, there will be better performance of tasks.

Goal setting is a continous process that is improved by feedback of all stakeholders.

In setting goals performance is improved when the people that implement and formulate the goals are involved.

This will result in higher buy in to the process since all interested parties set the goals together.

6 0
3 years ago
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