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kow [346]
2 years ago
15

You are bullish on telecom stock. the current market price is $110 per share, and you have $22,000 of your own to invest. you bo

rrow an additional $22,000 from your broker at an interest rate of 6.6% per year and invest $44,000 in the stock.
a. what will be your rate of return if the price of telecom stock goes up by 8% during the next year? (ignore the expected dividend.)
Business
1 answer:
deff fn [24]2 years ago
5 0

Answer:

9.4%

Explanation:

Initial investment=$22,000+$22,000=$44,000

number of shares bought=$44,000/$110(the investor paid $55 out of every $110)

number of shares bought=400

Increase in share in one year=$110*8%=$8.80

loan interest on each share=$55*6.6%=$3.63

rate of return=(increase in share price-loan interest)/initial amount invested

rate of return=($8.80-$3.63)/$55

rate of return=9.4%

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Shelly has $200,000 of QBI from her local jewelry store (a sole proprietorship). Shelly's proprietorship paid $30,000 in W–2 wag
natka813 [3]

Answer:

Qualified Business Income (QBI) Deduction:

With respect to the applicable provisions, the following are the provisions relating to QBI deduction:

(a) For Joint filers, if the taxable income is less than $315,000, the QBI deduction is limited to 20% of the qualified business income.

(b) The qualified business income includes the interest income not allocable to the business.

In the present case, the interest amount of $20,000 will not be considered for the calculation of QBI deduction (refer point (b) above).

Therefore, the total taxable income of S and her spouse will be $274,400 ($200,000 + $74,400) which was below the threshold limit of $315,000. Hence, they can claim the QBI deduction of 20% on the qualified business income of $200,000. The QBI deduction for 2018 is calculated as under:

QBI Deduction for 2018 = QBI x 20%

= $200,000 x 20%

= $40,000

Therefore, the QBI deduction for 2018 is $40,000.

Note: If the total taxable income exceeds the threshold limit of $315,000 for QBI deduction, the value of W-2 wages and qualified property would have been considered.

5 0
3 years ago
Three years ago American Insulation Corporation issued 10%, $800,000, 10-year bonds for $770,000. American Insulation exercised
My name is Ann [436]

Answer:

Explanation:

Dr Bond Payable $800,000

Dr Loss on early extinguishment $11,000

     Cr Discount on bonds $21,000 (7/10 x $30,000)

     Cr Cash $790,000

Supporting calculations:

*Unamortized discount calculation:

Face value of the bond 800,000

Less: issue price of the bond 770,000

Discount on bonds payable 30,000 (800,000-770,000)

Amortization of discount on bonds payable per year under straight line method             (30,000/10)  3,000  

Unamortized discount for the remaingg 7 years is 21,000 (7*3,000)

*Loss on early extinguishment calculation:

Face value of the bond 800,000

Less: Unamortized discount for the remaingg 7 years  21,000

Carrying value of the bonds (800,000-21,000) 779,000

Retirement price of the bonds 790,000

Loss on early extinguishment -11,000

5 0
3 years ago
Anyone finna be friends with me
Andreyy89

Answer:

yupp

Explanation:

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3 0
2 years ago
Pharma Company produces various medicines in capsule form. At the beginning of the month of March, it had 5,000 units that were
levacccp [35]

Answer:

Pharma Company

1. Weighted Average method:

Weighted Average Method:

Equivalent units of production:

Started and completed this period 55,000

Ending WIP                                        10,000

Total equivalent unit produced =   65,000

Total cost of production:

Beginning WIP =  $150,000

Current period     600,000

Total cost =        $750,000

Cost per equivalent unit = $11.54 ($750,000/65,000)

Cost assigned to:

Units completed = 55,000 * $11.5385 = $634,617

Ending WIP =         10,000 * $11.5385 =     115,385

Total cost of production =                     $750,002

Cost Reconciliation:

Beginning WIP = $150,000

Completed units  600,000

Total costs =      $750,000

Ending WIP =         115,385

Cost assigned to

  production        634,617

2. FIFO method:

Explanation:

a) Data and Calculations:

                                   Units    Completion %         Cost

Beginning WIP =       5,000       2,000 (40%)     $150,000

Current completion (WIP)         3,000 (60%)

Completed            55,000     55,000 (100%)     600,000

Ending WIP           20,000      10,000 (50%)

Weighted Average Method:

Equivalent units of production:

Beginning WIP                                     3,000

Started and completed this period 55,000

Ending WIP                                        10,000

Total equivalent unit produced =   68,000

Total cost of production:

Current period     600,000

Cost per equivalent unit = $8.82 ($600,000/68,000)

Cost assigned to:

Beginning WIP =  

Units completed

Beginning WIP =          $150,000

=    3,000 * $8.82 =       $26,460

= 55,000 * $8.82 =       485,100

Ending WIP:

= 10,000 * $8.82 =         88,200

Total cost of production = $749,760

Cost Reconciliation:

Beginning WIP (40%) = $150,000

WIP completed (60%)      26,460

Completed units            485,100

Ending WIP =                   88,200

Total cost =                 $749,760

7 0
2 years ago
Creaky and Toady. Beverly decides to go on a great trip to Hawaii. She needs someone, however, to take care of her two dogs, Cre
Korvikt [17]

dont know highschool

3 0
2 years ago
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