Two internal control measures in respect of creditors

Kay has decided to take out a $23,100 loan, and she wants to pay it back in quarterly installments. She has narrowed her options

fredd [130]

Answer:

The loan offered by bank W charges the most, $722.25 + $3,902.20 = $4,632.45.

The loan offered by bank V charges, $822.45 + $3,466 = $4,288.45

Loan W has $336 more in financial charges.

Explanation:

If Kay decides to take the loan form bank V, he will have to pay the initial service charge of $822.45, plus 24 quarterly installments of $1,106.92 each. The total interest charged by the bank will be $3,466

If he decides to take the loan form bank W, he will have to pay the initial service charge of $722.25, plus 36 quarterly installments of $843.82 each. The total interest charged by the bank will be $3,901.20.

5 0

4 years ago

Read 2 more answers

Suppose that borrowing is restricted so that the zero-beta version of the CAPM holds. The expected return on the market portfoli

Delvig [45]

Answer:

10.5%

Explanation:

In this question, we apply the Capital Asset Pricing Model (CAPM) formula which is shown below

Expected rate of return = Risk-free rate of return + Beta × (Market rate of return - Risk-free rate of return)

where,

Risk free rate of return = 7%

Market rate of return = 14%

And, the beta is 0.5

So the expected return is

= 7% + 0.5 × (14% - 7%)

= 7% + 0.5 × 7%

= 7% + 3.5%

= 10.5%

4 0

3 years ago

_____ programs mandate that each beginner serve as an assistant to a fully trained worker for a specified period of time before

Ludmilka [50]

<span>Apprenticeship programs are structured in such a way that it is mandated that each beginner would first serve as an assistant to a fully trained worker for a specified period of time before he or she gains full credentials to work in the field.</span>

6 0

4 years ago

Cheers Corporation purchased for $500,000 5,000 shares of Beer Corporation common stock (less than 5% of the outstanding Beer st

valentina_108 [34]

Answer:

Cheers Corporation

The amount that Cheers can deduct for the interest paid on the loan is:

= $50,000.

Explanation:

a) Data:

Investment in Beer Corporation = $500,000

Number of Beer shares purchased = 5,000

Percentage shareholding in Beer Corporation < 5%

Amount borrowed for the investment = $400,000

Own cash used for the purchase = $100,000

Interest paid on the debt for this year = $50,000 = 12.5%

Cash dividend received for the year = $40,000

Cheers taxable income before dividends = $5 million

The amount of interest deductible = $50,000

b) Since the interest was made for the purpose of the investment in Beers Corporation, the whole amount of interest expense for the year is deductible.

4 0

3 years ago

Munoz Sporting Equipment manufactures baseball bats and tennis rackets. Department B produces the baseball bats, and Department

QveST [7]

Answer:

a.

Baseball Bats Profit = $110,000

Tennis Racket Profit = $429,000

b.

Baseball Bats were more profitable; so, Maria was wrong

Baseball Bats Profit = $300,000

Tennis Racket Profit = $239,000

Explanation:

(See attachment below)

a.

Calculating Profit (Baseball Bat)

Profit = Revenue - (Direct Labour + Direct Material + Overhead)

Revenue = $1,630,000

Direct Labour = $380,000

Direct Material = $570,000

Overhead Cost = 150% * Direct Labour

Overhead Cost = 1.5 * $380,000

Overhead Cost = $570,000

So, Profit = $1,630,000 - ($380,000 + $570,000 + $570,000)

Profit = $1,630,000 - $1,520,000

Profit = $110,000

Calculating Profit (Tennis Racket)

Profit = Revenue - (Direct Labour + Direct Material + Overhead)

Revenue = $1,200,000

Direct Labour = $190,000

Direct Material = $296,000

Overhead Cost = 150% * Direct Labour

Overhead Cost = 1.5 * $190,000

Overhead Cost = $285,000

So, Profit = $1,200,000 - ($190,000 + $296,000 + $285,00)

Profit = $1,200,000 - $771,000

Profit = $429,000

b. Baseball Bats were more profitable; so, Maria was wrong.

Calculating Profit (Baseball Bat)

Profit = Revenue - (Direct Labour + Direct Material + Overhead)

Revenue = $1,630,000

Direct Labour = $380,000

Direct Material = $570,000

Overhead Cost = 100% * Direct Labour

Overhead Cost = 1 * $380,000

Overhead Cost = $380,000

So, Profit = $1,630,000 - ($380,000 + $570,000 + $380,000)

Profit = $1,630,000 - $1,330,000

Profit = $300,000

Calculating Profit (Tennis Racket)

Profit = Revenue - (Direct Labour + Direct Material + Overhead)

Revenue = $1,200,000

Direct Labour = $190,000

Direct Material = $296,000

Overhead Cost = 250% * Direct Labour

Overhead Cost = 2.5 * $190,000

Overhead Cost = $475,000

So, Profit = $1,200,000 - ($190,000 + $296,000 + $475,00)

Profit = $1,200,000 - $961,000

Profit = $239,000

6 0

3 years ago

Two internal control measures in respect of creditors​

Two internal control measures in respect of creditors