Secured and unsecured loans differ in cost because A secured loan typically has lower interest rates costing less; an unsecured loan typically has higher interest rates costing more.
<h3>How are secured and unsecured loans different?</h3>
A secured loan is one that is backed by the assets of the person being loaned the money. If the person is unable to pay, the asset is seized.
Unsecured loans are not backed by any assets which means that the lender will have nothing to claim in default. This makes these type of loans risky which is why they command more interest.
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The cash outflow for rent that would be reported on the Year 1 statement of cash flows is $2,700
<h3>What is cashflow?</h3>
This is the amount of cash , which a company receives or gives out by the way of payments to its creditors.
Though the amount paid was paid on October 1, Year 1 it will only be expensed from October to December for year 1.
The duration of the payment is 12 months, hence
Monthly amortization
= $3,600 / 12
= $300
Rent expense for year 1
= $300 × 3
= $900
The ending balance in the prepaid rent account will be
= $3,600 - $900
= $2,700
This will be the cash outflow for rent that would be reported on the Year 1 statement of cash flows.
Hence, the cash outflow for rent that would be reported on the Year 1 statement of cash flows is $2,700
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Answer: Records its obligation to pay a dividend
Explanation:
The declaration date is the particular date where the board of directors of a company takes the decision to pay a dividend to all the stakeholders of the company.
A dividend is the benefit a shareholder of a company, gets as a result of the profit the company makes during a period.
Answer: The bond will be issued at a premium
Explanation: If the interest rate on bond is higher than the market interest rate then the investors of such bond will get a greater benefit. Hence to get the greater benefit an investor must pay a higher value, thus, the bond will be issued at premium.
Higher interest rate means the company will pay interest to investors mare than i the general rate in market, Therefore, company can charge investors more from a more valuable asset.
Hence from the above we can conclude that the correct option is c.