When the Federal Reserve puts money into the banking system,<em> short term interest rates fall</em> <span>because there is more capital in the system. This means that banks are willing to take more risks.
>>></span><span>The </span>Federal Reserve<span> System—also termed as the </span>Federal Reserve<span> or the Fed—is the central banking system of the United States. </span>
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Explanation:
A partnership is a business shared by multiple owners. It's not a legal business entity, and it doesn't have to be registered with the state. Basically, if you decide to go into business with another person without filing any state paperwork, you're automatically in a partnership
Answer: True
Explanation:
Revenue variances are used by an organization in order to know the difference that exists between the expected sale by the organization and and actual sales.
The revenue variance is the difference between what the total sales revenue should be, given the actual level of activity of the period, and the actual total sales revenue.
Answer:
(a) 62%
(b) 3.83 times
(c) Yes
Explanation:
(a) Ellie's debt ratio:
= Total Debt ÷ Total assets
= $39 million ÷ $63 million
= 0.62 or 62%
(b) Ellie's times interest earned ratio:
= Interest ÷ EBIT
= $23 million ÷ $6 million
= 3.83 times
(c) Yes, it has enough times interest ratio.
If Interest expenses increased to $7 Million, then
Company could easily raise more debt to finance additional funding needs.
Answer:
D. $30,000
Explanation:
The bond is issued on discount when the issuance price is less than the face value of the bond. The discount is expensed over the bond period until maturity. It is added to the interest expense value to expense it.
This discount will be amortized using Effective Interest method as below
Interest Payment = $5,000,000 x 8% x 6/12 = $200,000
Interest Expense = $4,600,000 x 10% x 6/12 = $230,000
Discount amortization = $230,000 - $200,000 = $30,000
