Answer:
Cash and contributed capital
Explanation:
The journal entry to record the sale of common stock is shown below:
Cash A/c Dr $45,000
To Common stock A/c $45,000
(Being the common stock is sold)
For recording this transaction, we debited the cash account as the sale is made which increases the asset and credited the common stock account because the common stock is sold which reduces the equity balance.
"<span>Store Within A Store"</span>
Answer:
a. $3.5 per share
b. $1.49 per share
c. $38.38 per share
d. 1.93 times
Explanation:
The computation is shown below:
a. Earning per share = (Net income) ÷ (Number of shares)
where,
Net income = Additions to retained earnings + cash dividends
= $261,000 + $194,000
= $455,000
So, the earning per share equal to
= $455,000 ÷ 130,000 shares
= $3.5 per share
b. Dividend per share = (Total dividend) ÷ (number of shares)
= ($194,000) ÷ (130,000 shares)
= $1.49 per share
c. Book value per share = (Total equity) ÷ (number of shares)
= ($4,990,000) ÷ (130,000 shares)
= $38.38 per share
d. Market to book ratio = (Market price per share) ÷ (book value per share)
= $74 ÷ $38.38
= 1.93 times
Answer:
If effective, such a price floor would be <u>above</u> the market price and would lead to a <u>excess supply</u>.
Explanation:
A price floor can be described as a price control in which the minimum price to be charged for goods and services is imposed by a government or a group.
For a price floor to be effective and binding, it has to be set above the market or equilibrium price. This is because a price floor will neither be effective nor nonbinding when it set below the equilibrium price.
Any price above the equilibrium or market price creates or leads to excess supply. Excess supply is a situation whereby quantiy of commodity supplied is more than the quantity demanded of the commodity.
Based on the above explanation, if effective, such a price floor would be <u>above</u> the market price and would lead to a <u>excess supply</u>.
Answer: I must invest <u>$85424.14</u> today in order to buy a Ferrari nine years from now on the day I turn 30.
We have
Price of the Ferrari nine years from now (Future Value - FV) $215000
Expected Rate of return on the mutual fund (r) 10.8%
Time until I turn 30 (n) 9 years
We can calculate the Present Value (PV) or the money to be invested today as
