What is 700 units at $6.80 value

Coney Island Entertainment issues $1,300,000 of 5% bonds, due in 15 years, with interest payable semiannually on June 30 and Dec

Ganezh [65]

Answer:

1) The market interest rate is 5% and the bonds issue at face amount.

Dr Cash 1,300,000

Cr Bonds payable 1,300,000

Year Interest payment Book value of bonds

June/1 $32,500 $1,300,000

Dec/1 $32,500 $1,300,000

June/2 $32,500 $1,300,000

2) The market interest rate is 6% and the bonds issue at a discount.

price of bonds:

PV of face value = $1,300,000 / (1 + 3%)³⁰ = $535,582.79

PV of coupons = $32,500 x 19.600 (PV annuity factor, 3%, 30 periods) = $637,000

market price = $1,172,582.79

Dr Cash 1,172,582.79

Dr Discount on bonds payable 127,417.21

Cr Bonds payable 1,300,000

discount amortization per coupon payment = $127,417.21 / 30 = $4,247.24

Year Cash paid Interest Amortization Bond Book

expense bond discount discount value

June/1 $32,500 $36,747.24 $4,247.24 $123,169.97 $1,176,830.03

Dec/1 $32,500 $36,747.24 $4,247.24 $118,922.73 $1,181,077.27

June/2 $32,500 $36,747.24 $4,247.24 $114,675.49 $1,185,324.51

3. The market interest rate is 4% and the bonds issue at a premium.

price of bonds:

PV of face value = $1,300,000 / (1 + 2%)³⁰ = $717,692.16

PV of coupons = $32,500 x 22.396 (PV annuity factor, 2%, 30 periods) = $727,870

market price = $1,445,562.16

Dr Cash 1,445,562.16

Cr Bonds payable 1,300,000

Cr Premium on bonds payable 145,562.16

discount amortization per coupon payment = $145,562.16 / 30 = $4,852.07

Year Cash paid Interest Amortization Bond Book

expense bond discount premium value

June/1 $32,500 $27,647.93 $4,852.07 $140,710.09 $1,440,710.09

Dec/1 $32,500 $27,647.93 $4,852.07 $135,858.02 $1,435,858.02

June/2 $32,500 $27,647.93 $4,852.07 $131,005.95 $1,431,005.95

6 0

3 years ago

The purpose of an analysis of an account is to illustrate - in the account for the period under audit

Archy [21]

Answer:

all changes

Explanation:

Financial accounting is an accounting technique used for analyzing, summarizing and reporting of financial transactions like sales costs, purchase costs, payables and receivables of an organization using standard financial guidelines such as Generally Accepted Accounting Principles (GAAP).

An auditor refers to an authorized individual who review, examine and verify the authenticity and accuracy of business financial records or transactions.

The purpose of an analysis of an account is to illustrate all changes in the account for the period under audit. Thus, an audit of historical financial statements most commonly includes the balance sheet, income statement, statement of cash flows, and the statement of changes in stockholders' equity.

There are two (2) main types of financial analysis;

I. Vertical analysis.

II. Horizontal analysis.

In Financial accounting, Horizontal analysis can be defined as an analysis and evaluation of a financial statement which illustrates or gives information about changes in the amount of corresponding financial statement items, benchmarks or financial ratio over a specific period of time. It is one of the most important technique that is used to measure how a business is doing financially. Hence, it is also referred to as the trend analysis.

Under the horizontal analysis of financial statement, we use the financial statements of two or more periods; earliest and latter periods.

Generally, the earliest is chosen as the base period while all other items on the statement for a latter period will be compared with the items on the statement of the base period.

3 0

3 years ago

Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.3 milli

laiz [17]

Answer:

a)

MACRS 3 year depreciation schedule

33.33% x $2,300,000 = $766,590

44.45% x $2,300,000 = $1,022,350

14.81% x $2,300,000 = $340,630

carrying value at end of year 3 = $170,430

net after tax cash flow from salvage value = $210,000 - [($210,000 - $170,430) x 22%] = $201,294.60

cash flows:

year 0 = -$2,300,000 - $270,000 = -$2,570,000

year 1 = [($1,720,000 - $628,000 - $766,590) x 0.78] + $766,590 = $1,020,410

year 2 = [($1,720,000 - $628,000 - $1,022,350) x 0.78] + $1,022,350 = $1,076,677

year 3 = [($1,720,000 - $628,000 - $340,630) x 0.78] + $340,630 + $201,294.60 + $270,000 = $1,397,993

b)

NPV = $297,794, and IRR = 16.12%

6 0

3 years ago

Your first job is to settle the dispute between the owners. To settle the dispute, you need to ensure that both owners understan

Aneli [31]

Answer:

Inelastic: Demand for business goods tends to be me more inelastic than demand for consumer goods.

Explanation:

I already did this before. ur welcome

4 0

2 years ago

Kids' Corner, a toy store, ordered a supply of stuffed toys from Toyland Inc. The toys were supposed to be delivered on the 1 st

AveGali [126]

Kids' Corner, a toy store, ordered a supply of stuffed toys from Toyland Inc. The toys were supposed to be delivered on the 1st of December but were sent to Kids' Corner on the 5th of December. There has been a(n) _____ of contract.

A. compensatory breach

B. anticipatory breach

C. material breach

D. concurrent breach

Correct Option:

There has been a material breach of contract.

Option: C

Explanation:

A contract law concept that applies to a non-performance under the contract that is sufficiently serious to give the grieved party the right to sue for contravention of the contract, is understood as a material break or infringement.

If a substantive violation has occurred, the aggrieved party is therefore deprived of a contractual duty to further results. Here the Kids' Corner toy store ordered a supply of stuffed toys from Toyland Inc. but received order in delay date, which is considered as material breach due to late delivery of expected material.

5 0

3 years ago