Answer:
Interest amount = $67.5
Explanation:
Use the below formula to find the interest amount:
Interest amount = The value of note x Interest rate x (90 / 360)
Given value of note = $2700
Interest rate = 10%
Time = 90/360
Now plug the value in the above formula and solve for the interest due:
Interest amount = The value of note x Interest rate x (90 / 360)
Interest amount = 2700 x 10% x (90 / 360)
Interest amount = $67.5
Answer:
Thomson Co.
Journal entries:
May 1:
Debit Cash Account $240,000
Credit Bonds Payable $240,000
To record the issue of 10-year, 9% bonds at face value.
Nov. 9:
Debit Interest on Bonds $10,800
Credit Cash Account $10800
To record the payment of 6-months interest.
Dec. 31:
Debit Interest on Bonds $3,600
Credit Interest on Bonds Payable $3,600
To record two-months interest accrued.
Explanation:
The journal entries made by Thomson Co. are to record the bond transactions. For example, when the bonds were issued, cash was received. This transaction gives rise to a debit to the Cash Account that received the value and a credit to the Bonds Payable Account that gave the value. The bonds payable account represents the liability that is contracted by the bonds issue. Recording these transactions in the journal show their effects on the accounting equation that requires assets to be equal to liabilities and owner's' equity following each transaction.
Answer:
The correct answer is letter "C": fall. The fall in taxes stimulates aggregate demand.
Explanation:
Recessions are the economic phases characterized by a decrease in economic growth. Unemployment rises, real income decreases, and the overall economy of a country dwindles. However, the government intervenes to turn around the situation by establishing fiscal policies.
<em>In such scenarios the tax rate decreases for individuals and institutions to have more money available so their purchasing power increases which, eventually, increases the aggregate demand (total demand for finished products).</em>
