Answer:
There is an opportunity cost to going to the movie and he should leave the movie.
Explanation:
Yes, there is an opportunity cost involved when the person goes for the movie. The opportunity cost will the work that he can do instead of going to the movie. For instance, if the person has the option to study or to watch a movie and he chooses the movie then the opportunity cost is the study. Moreover, he should leave the movie because it is terrible and if he does other work by leaving the movie then he will be benefited because the opportunity cost of doing other work will be lower.
Answer: See explanation
Explanation:
The revaluation model is when the fixed asset of a business or an organization is carried at its revalued amount.
Based on the question asked, the asset will be valued based on the new fair value with regards to the increase. It should be noted that the remainder recognized will then be recognized in the other comprehensive income.
Answer:
The correct answers are:
C-debit paid-in capital treasury shares $200
D-Debit retained earnings $300
Explanation:
The purchase of treasury stock for $10 per share implies that the price paid per share is the par value of each share.
Upon issue of 100 shares at $12 the following entries are required:
Dr Cash (100*$12) $1,200
Cr Treasury stock(100*$10) $1,000
Cr Paid-in capital in excess of par $200
However upon issue of 500 share at $9 per share which is $1 less than the par value, hence there is $500 discount on the issue.
The discount is recorded as follows:
Dr paid-in capital $200
Dr Retained earnings $300
The $200 posted to paid-in capital is the same premium that posted in there earlier when 100 shares.
Answer:
c. accept the loan with the lower effective annual rate rather than the loan with the lower annual percentage rate.
Explanation:
In the above scenario it will be a good financial decision to choose a loan with lower effective rate than the one with lower percentage rate.
Effective rate is defined as the real interest rate on a loan or the actual amount that is to be repaid annually on a loan. It gives a truer picture of cost of borrowing money.
Percentage rate is interest paid on a loan expressed as a percentage of the total amount collected. It usually includes various fees and charges collected by the lender. So it is not a true reflection of the cost of borrowing
