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AVprozaik [17]
3 years ago
8

Pharoah Company borrowed $1470000 from U.S. Bank on January 1, 2019 in order to expand its mining capabilities. The 5-year note

required annual payments of $382842 and carried an annual interest rate of 9.5%. What is the amount of expense Pharaoh must recognize on its 2020 income statement
Business
1 answer:
nikklg [1K]3 years ago
6 0

Answer:

$116,546.76  

Explanation:

Loan amount=$1470000

interest expense in 2019=$1470000*9.5%=$139,650  

annual repayment=$382,842

Balance of the loan as the end of 2019=loan amount-annual repayment+interest expense

Balance of the loan as the end of 2019=$1470000-$382,842+$139,650  

balance of the loan as of the end of 2019=$1,226,808  

2020 interest expense=balance as the end of 2019*interest rate

2020 interest expense=$1,226,808 *9.5%

2020 interest expense=$116,546.76  

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a 17-year annuity pays $1,100 per month, and payments are made at the end of each month. The interest rate is 16 percent compoun
zzz [600]

Answer:

The present value of the annuity is $73,091.50

Explanation:

Use the following formula to calculate the present value of the annuity

Present value of annuity = ( Annuity Payment x Annuity factor for first 6 years ) + [ ( Annuity Payment x Annuity factor for after 6 years ) x Present value factor  for 6 years ]

Where

Annuity Payment = $1,000

Annuity factor for first 6 years = 1 - ( 1 + 16%/12 )^-(6x12) / 16%/12 = 46.10028344

Annuity factor for after 6 years = 1 - ( 1 + 13%/12 )^-((17-6)x12) / 13%/12 = 70.0471029820

Present value factor for 6 years = ( 1 + 16%/12)^-(6x12) = 0.385329554163

Placing values in the formula

Present value of annuity = ( $1,000 x 46.10028344 ) + [ ( $1,000 x 70.0471029820 ) x 0.385329554163 ]

Present value of annuity = $46,100.28 + $26,991.22

Present value of annuity = $73,091.50

4 0
2 years ago
On January 1, 2022, the Sheridan Company ledger shows Equipment $49,700 and Accumulated Depreciation $18,280. The depreciation r
Lisa [10]

Answer:

revised annual depreciation will be : 13710

Explanation:

After revision the remaining life of equipment shrank down to 2 years, so the depreciation working will be worked out to adjusted the impact of decreasing of useful life.

As per existing information the depreciation charges are calculated as :

(Cost-Salvage Value)/Useful life= (49700-4000)/10 = 4570

Accumulated Depreciation indicates that 4 years have past by (18280/4570)

now remaining years are 6 which will be reduced to 2 after revision so the new working will be as follows:

Remaining Cost :31420  (49700 -18280)

Salvage Value : 4000

Revised Remaining Useful Life  : 2

Revised Calculated Depreciation Annual  : (31420-4000)/2 = 13710

It can be further verified through simple math also:

Adding annual depreciation of remaining 2 years : 13710 +13710 =27420

Value available for depreciation after salvage value : 31420 -4000= 27420

3 0
3 years ago
In a deferral adjustment for revenues collected in advance that are now earned, ______. a) the liability recorded when cash was
frosja888 [35]

Answer:

a) the liability recorded when cash was received is decreased by the adjustment for the revenue being earned

Explanation:

When cash is received for revenue yet to be earned, it is called deferred revenue. The entries posted at this point is a Debit to Cash (an increase in cash balance) and a Credit to Deferred revenue (a liability account). When the revenue gets earned, it get recognized with a Debit to Deferred revenue (to reduce the liability as the obligation has been fulfilled resulting in revenue being earned) and a Credit to Revenue (P/L).

Hence, the right option is a) the liability recorded when cash was received is decreased by the adjustment for the revenue being earned.

8 0
3 years ago
Here is a series of addresses in hexadecimal: 20, 3c, 10, 16, 20, 04, 28, 60, 10, 17 assume a lru replacement algorithm. for the
sp2606 [1]
<span>If there is a series of addresses in hexadecimal: 20, 3c, 10, 16, 20, 04, 28, 60, 10, 17 and it is assumed that an LRU replacement algorithm, then in order to solve the problem is to keep in mind that the two addresses included and be in the same set.</span>
7 0
3 years ago
Paying Your Taxes Reading Quiz
Bumek [7]

Answer:

b

Explanation:

8 0
2 years ago
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