Answer:
Date Account Titles and Explanation Debit Credit
Land $84,000
Common stock $12,000
Paid in capital in excess of par value $72,000
Workings:
Amount of Common stock = Number of shares * Paid in capital per share
= 6,000 shares * $2
= $12,000
Amount of excess of paid in capital = Market value of land - Amount of common stock
= $84,000 - $12,000
= $72,000
Answer:
<u>C. The company has a very poor turnover of assets and collects its receivables quickly; thus there are some concerns from these ratios. D</u>
<u>Explanation:</u>
Let's be mindful that turnover here refers to <em>revenue</em>, while receivables refer to<em> amounts owed to the company</em>. So, If the company has a very poor turnover of assets it means it isn't making much revenue, and it is collecting its receivables quickly implying there are some concerns (imbalances) from these ratios.
Therefore, the managers of Tyler Toys or the shareholders need to work out a solution.
Answer:
The price of the stock today is $16.83
Explanation:
The current price per share can be estimated using constant growth model of the DDM. The price per share can be calculated using the following formula,
P0 = D1 / r - g
To calculate the price today, we use the dividend expected for the next period. Thus, using the dividend that will be paid at t=11 or D11, we can calculate the price of the stock at t=10. We further need to discount this price using the required rate of return for 10 years to calculate the price of the stock today.
P10 = 6 * (1+0.04) / (0.14 - 0.04)
P10 = $62.4
The price of the stock today will be,
P0 = 62.4 / (1.14)^10
P0 = $16.83
Answer: (a) Fall
(b) Increase
(c) Increase
(d) Unchanged
Explanation:
Suppose there is a competitive market with a downward sloping demand curve and horizontal supply curve. In a competitive market there are large number of buyers and sellers. So, if there is a downward shift in the supply curve, as a result equilibrium price will fall, equilibrium quantity will increase, consumer surplus now become larger and producer surplus remains the same because of the horizontal supply curve.
Answer:
a. Does this create a disbursement float or a collection float?
A disbursement float occurs when you write a check and hand it out, but the person that receives the check hasn't cashed it yet. You do not owe the money anymore, but it still appears on your bank account.
b. What is your available balance?
your bank account balance = $135,000
c. What is your book balance?
book balance = $135,000 - $49,000 = $86,000
