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3 years ago

What actions might be taken to reduce the risk associated with a loan to start the business? Give examples please

Business

1 answer:

8_murik_8 [283]3 years ago

5 0

Answer:

funny business has the word loan in it never trusted cuz one they might take away all your money and use it for something else like spending it on spoiled Rich daughters and pretty much just using your own money on random things that they don't need

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Nature of Transactions Kristoff Walker operates his own catering service. Summary financial data for February are presented in e

vichka [17]

Answer:

A. Description for :

Transaction 1 - Provided catering service for cash

Transaction 2 - Purchase of land for cash

Transaction 3 - Payment of cash for expenses

Transaction 4 - Purchase of supplies on account

Transaction 5 - Withdrawal of cash by owner

Transaction 6 - Payment of cash to creditors

Transaction 7 - Recognition of cost of supplies used

B. The amount of the net decrease in cash during the month = 13,900

C. The amount of the net increase in owner's equity during the month = 3700

D. The amount of the net income for the month = 5500

E. The net income for the month was retained in the business = 3700

Explanation:

Description for :

Transaction 1 - Provided catering service for cash

Transaction 2 - Purchase of land for cash

Transaction 3 - Payment of cash for expenses

Transaction 4 - Purchase of supplies on account

Transaction 5 - Withdrawal of cash by owner

Transaction 6 - Payment of cash to creditors

Transaction 7 - Recognition of cost of supplies used

b.)

Net decrease = Closing Balance - opening Balance

= 27,600 - 13,700

= 13,900

⇒The amount of the net decrease in cash during the month = 13,900

c.)

Net increase in owner's equity = ( Opening capital balance - Drawing + Income earned during the year - Expenses incurred during the year ) - Opening capital

⇒Net increase = ( 92,700 - 1800 + 32,300 - 26,800 ) - 92,700

= 96,400 - 92,700 = 3700

⇒The amount of the net increase in owner's equity during the month = 3700

d.)

Amount of the net income for the month = Total Income - Expenses

= 32,300 - 26,800

= 5500

⇒Amount of the net income for the month = 5500

e.)

Net income for the month was retained in the business = Net Income - Drawings

⇒Net income was retained in the business = 5500 - 1800

= 3700

⇒Net income for the month was retained in the business = 3700

7 0

2 years ago

A structure was built five years ago. Because of exceptional upkeep, the appraiser estimates the structure's condition today to

frosja888 [35]

Based on the useful life and the appraised age of the house, the effective age is <u>3 years.</u>

<h3>What is the effective age?</h3>

It is the age of a structure based on its physical condition and upkeep.
It is found by subtracting the remaining economic life from the economic life of the structure.

As a result of the physical condition and upkeep of the property, the appraiser estimates it to be equivalent to a 3 year old home. This is therefore the effective age.

Find out more on appraisals at brainly.com/question/15032807.

6 0

2 years ago

Larson Manufacturing is considering purchasing a new injection-molding machine for $360 comma 000360,000 to expand its product

Anastaziya [24]

Answer:

If I bougth the Machine at 14% interest.

This purchase is not justified

Depreciation expenses and credit interest are greater than the income generated

Explanation:

Machine 360000

Adittional cost 20000

Final Cost 380000

Salvage Value 73000

Machine value for depreciation 307000

year 1 307000 61400 245600

year 2 245600 61400 184200

year 3 184200 61400 122800

year 4 122800 61400 61400

year 5 61400 61400 0

Period Payment Capital Interest Loan

360000

1 104.862 54.462 50.400 305.538

2 104.862 62.087 42.775 243.451

3 104.862 70.779 34.083 172.672

4 104.862 80.688 24.174 91.984

5 104.862 91.984 12.878 0

Depreciation 307000

Interes 164.310

Expenses 471.310

Revenue 430.000

8 0

3 years ago

Over a certain period, large-company stocks had an average return of 12.59 percent, the average risk-free rate was 2.58 percent,

suter [353]

Answer:

The answer is 14.87%

Explanation:

Solution

Given that:

A large company stock had an average return of =12.59%

The average risk free rate = 2.58%

A small company stocks average is =17.45

The next step is to find the risk premium on small-company stocks for this period

Thus,

The risk premium on small-company stocks = Average return on small-company stocks - average risk-free rate

So,

Risk premium on small-company stocks = .1745 - 0.258

=0.1487

Therefore the risk premium on small company stocks for the period was 14.87%

6 0

3 years ago

Last year Lowell Inc. had a total assets turnover of 1.40 and an equity multiplier of 1.75. Its sales were $295,000 and its net

katrin [286]

Answer:

ROE would have changed by 8.52%

Explanation:

First we calculate the current ROE using Dupont Equation which gives ROE as,

ROE = Net Income/Sales * Sales/Total Assets * Total Assets/Equity

ROE = Net Profit Margin * Total Assets Turnover * Equity Multiplier

Current ROE = 10600/295000 * 1.4 * 1.75 = 0.0880 or 8.8%

The condition says that the net income could have increased to 20850 but other factors will remain constant. Thus, to calculate new ROE, we will calculate the new Net Profit margin but the total assets turnover and the equity multiplier will remain constant as sales assets and capital structure is not changing.

New ROE = 20850/295000 * 1.4 * 1.75 = 0.17316 or 17.32%
The ROE would have changed by 17.32 - 8.80 = 8.52%

7 0

3 years ago

What actions might be taken to reduce the risk associated with a loan to start the business? Give examples please​

What actions might be taken to reduce the risk associated with a loan to start the business? Give examples please