Answer:

$246,000

Explanation:

Calculation to determine the additional funds Carlsbad will need for the coming year

First step is to calculate the 2020 retained earnings using this formula

2020 retained earnings= net income margin* sales* retention ratio

Let plug in the formula

2020 retained earnings= 3%*6000000*30%

2020 retained earnings= $54,000

Now let calculate the AFN using this formula

AFN = Increase in assets-Increase in spontaneous liabilities -Retained earnings

Let plug in the formula

Increase in assets =$2,000,000*20% =$400,000

Increase in spontaneous liabilities= (250000+250000)*20%=100000

AFN= 400000-100000-$54000

AFN =$246,000

Therefore the additional funds Carlsbad will need for the coming year is $246,000

**Answer:**

The correct answer is letter **"A": Rainy day funds are classified as committed or restricted if imposed externally or by law.
**

**Explanation:**

**Rainy day funds **refer to reserves of resources states keep in case of emergencies or budget shortfalls. These funds are reserved for periods when revenues do not meet expectations and expenditures are higher. Rainy day funds are also used when the state should not incur debt because its financial situation is not optimal.

<em>Rainy days are classified as committed if created by resolution and, in such cases, the purpose of those funds is specified.</em>

**Answer:**

**$532,349**

**Explanation:**

We first calculate the weighted average cost of capital to discount the cash flows,

WACC

= Weight of equity * return on equity + weight of debt * after-tax return of debt

WACC = 0.6*0.14 + 0.40*0.055 = 0.106 or 10.6%

PV of 398,000 = 398,000 * (1/1+0.106) = $359855.33

PV of 211,000 = 211,000 * (1/(1+0.106)^{2}) = $172,493.3

Total NPV = $532348.61 or $532,349 rounded

Hope that helps.

Answer:A debit to interest expense for $36,000

Explanation:

interest expense= 800,000-80,000 = 720,000 5% 12/12