Answer:
Quick ratio = Current assets - Inventory/Current liabilities
= $480,000 - $340,000/$40,000
= 3.5
Current assets = $120,000 + $340,000 + $20,000 = $480,000
Current liabilities = $20,000 + $20,000 = $40,000
Explanation:
Explanation: Quick ratio is the ratio of liquid assets to current liabilities. Liquid assets are current assets less inventory. Liquid assets amounted to $140,000 while current liabilities are $40,000. The division of liquid assets by current liabilities gives quick ratio.
Answer:
Shoe-leather Costs.
Explanation:
In this scenario, Bob manages a grocery store in a country experiencing a high rate of inflation. He is paid in cash twice per month. On payday, he immediately goes out and buys all the goods he will need over the next two weeks in order to prevent the money in his wallet from losing value.
What he can't spend, he converts into a more stable foreign currency for a steep fee. This is an example of the Shoes-leather costs of inflation.
A Shoe-leather costs refers to the costs of time, energy and effort people expend to mitigate the effect of high inflation on the depreciative purchasing power of money by frequently visiting depository financial institutions in order to minimize inflation tax they pay on holding cash.
Metaphorically, it ultimately implies that in order to protect the value of money or assets, some people wear out the sole of their shoes by going to financial institutions more frequently to make deposits.
Hence, Bob is practicing a shoe-leather cost of inflation so as to reduce the nominal interest rates.
Answer:
The amount of the fee is $1689.60
Explanation:
The computation of the amount of the fee is shown below:
= Dollar value × fund charges a 12b-1 fee
= $211,200 × 0.8%
= $211,200 × 0.008
= $1689.60
Since the question has asked the fee amount so we consider the fee charges percentage, not the capital investment Lifecycle fund. Thus, we ignore the Capital Investments Lifecycle Fund as it is not relevant.
Hence, the amount of the fee is $1689.60
Answer:
c. automatic fiscal policy
Explanation:
Automatic fiscal policy are policies triggered automatically due to the state of the economy which causes either government spending or taxes to increase or decrease.
For example, if the economy is undergoing a downturn and real GDP falls, the amount paid as taxes would fall.
If the economy is booming and the real GDP rises, the amount paid as taxes would rise.
These are examples of automatic fiscal policies.
Discretionary fiscal policy is when the government purposely increases or reduces either its spending or taxes in response to the economic conditions.
I hope my answer helps you.
Answer:
The journal entry which is to be recorded for the first installment payment on the note is shown below:
Explanation:
The journal entry is as on December 31, 2015
Interest Expense A/c.................Dr $4,500
Notes Payable A/c.......................Dr $20,881
Cash A/c..............................Cr $25,381
Working Note:
Interest expense = Borrowed amount × 5%
= $90,000 × 5%
= $4,500
Note Payable = Cash - Interest expense
= $25,381 - $4,500
= $20,881