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RideAnS [48]
3 years ago
9

On January 1, 2016, Ott Company sold goods to Fox Company. Fox signed a noninterest-bearing note requiring payment of $60,000 an

nually for seven years. The first payment was made on January 1, 2016. The prevailing rate of interest for this type of note at date of issuance was 10%. Information on present value factors is as follows: Ott should record sales revenue in January 2016 of a. $214,200 b. $261,600 c. $292,600 d. $321,600Table:Business figures are shown
Business
1 answer:
inessss [21]3 years ago
3 0

Answer:

D. 321,600.

Explanation:

Present value is the current value of a future amount that is to be received or paid out.

Given:

Present value, P = $60000

Present value of ordinary annuity for the remaining 6 years = 4.36

The Present value, PV of the note is equal to the first payment + the Present value of ordinary annuity (all at 10%) of the remaining six payments

Sales revenue = $60000 + (60,000 × 4.36)

= $60000 + $261,600

= $321,600

Thus, sales revenue of $321,600.

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Which country in the middle east has the most crude oil?.
Gekata [30.6K]
Saudi Arabia has the most
5 0
2 years ago
Keiko manages a team of graphic designers. She distributes a document describing in detail each task for an upcoming project. Ea
seraphim [82]

Answer:

responsibilities scope

Explanation:

Keiko is describing responsibilities for each team member so each one knowns what is expected from them

4 0
3 years ago
On January 1, 2021, the company obtained a $3 million loan with a 14% interest rate. The building was completed on September 30,
Svet_ta [14]

Answer:

1. Calculate the amount of interest that Mason should capitalize in 2021 and 2022 using the weighted-average method.

interest capitalized in 2021 = $166,189

interest capitalized in 2022 = $77,956

2. What is the total cost of the building?

total construction costs ($6,375,000) + capitalized interests ($244,145) = $6,619,145

3. Calculate the amount of interest expense that will appear in the 2021 and 2022 income statements.

interest expense 2021 = $1,148,000 - $166,189 = $981,811

interest expense 2022 = $1,148,000 - $77,956 = $1,070,044

Explanation:

a 14%, $3,000,000 loan obtained on January 1, 2021

building was completed on September 30,2022

January 1, 2021: $1,050,000 x 12/12 = $1,050,000

March 1, 2021: $870,000 x 10/12 = $725,000

June 30, 2021: $390,000 x 6/12 = $195,000

October 1, 2021: $690,000 x 3/12 = $172,500

total weighted average expense 2021 = $2,142,500

weighted average interest rate:

$3,000,000 x 14% = $420,000

$4,900,000 x 5% = $245,000

$6,900,000 x 7% = $483,000

average interest rate = $1,148,000 / $14,800,000 = 7.7568%

interest capitalized in 2021 = $2,142,500 x 7.7568% = $166,189

January 31, 2022: $675,000 x 8/9 = $600,000

April 30, 2022: $990,000 x 5/9 = $550,000

August 31, 2022: $1,710,000 x 1/9 = $190,000

total weighted average expense 2021 = $1,340,000

weighted average interest rate:

$3,000,000 x 14% = $420,000

$4,900,000 x 5% = $245,000

$6,900,000 x 7% = $483,000

average interest rate = $1,148,000 / $14,800,000 = 7.7568%

interest capitalized in 2022 = $1,340,000 x 7.7568% x 9/12 = $77,956

4 0
2 years ago
Kohler Corporation reports the following components of stockholders’ equity at December 31, 2018. Common stock—$20 par value, 10
gogolik [260]

Answer:

1. See the attached excel file for the journal entries.

2. Ending balance of retained earning is $346,125

3.Total Stockholder's Equity is $1,616,125

Explanation:

1. Prepare journal entries to record each of these transactions.

Note: See the attached excel file for the journal entries.

The following are tge workings:

w.1: Treasury stock = $5,000 * $20 = $10,000

w.2: Dividend payable = (Issued and outstanding shares - Shares repurchase) * Dividend per share = (60,000 - 5,000) * $4 = 55,000 * $4 = $220,000

w.3: Cash = Number of shares sold * Selling price per share = 1,875 * $24 = $45,000

w.4 = Treasury stock = Number of shares sold * Treasury price per share = 1,875 * $20 = $37,500

w.5: Additional paid in capital = Number of shares sold * (Selling price per share - Treasury price per share) = 1,875 * ($24 - $20) = $7,500

w.6: Cash = Number of shares sold * Selling price per share = 3,125 * $17 = $53,125

w.7 = Treasury stock = Number of shares sold * Treasury price per share = 3,125 * $20 = $62,500

w.8: Balancing figure = Treasury stock (w.7) – Cash (w.7) - Additional paid in capital (w.5) = $62,500 - $53,125 - $7,500 = $1,875

w.9: Dividend payable = (Issued and outstanding shares * Dividend per share = 60,000 * $4 = $240,000

2. Prepare a statement of retained earnings for the year ended December 31, 2019.

Kohler Corporation

Statement of Retained Earnings

On December 31, 2019

<u>Particulars                                                  Amount ($)  </u>

Opening balance                                       400,000

Income for the year                                    408,000  

Dividend Paid (220,000 + 240,000)        (460,000)

Loss on sale of treasury stock               <u>        (1,875)    </u>

Ending balance                                     <u>      346,125   </u>

3. Prepare the stockholders’ equity section of the company’s balance sheet as of December 31, 2019.

Kohler Corporation

Stockholder Equity Section of Balance sheet

At December 31, 2019

<u>Particulars                                                        Amount ($)</u>

Common stock issued ($20 * 60,000)               1,200,000

Paid-in capital in excess of par v - c. stock     <u>        70,000  </u>

Total contributed Capital                                     1,270,000

Retained Earnings                                      <u>      346,125  </u>

Total Stockholder's Equity                             <u>     1,616,125  </u>

Download xlsx
3 0
3 years ago
Who is primarily responsible for the people who own the company stock?
Gnesinka [82]

Answer:

The people who buy the stock

Explanation:

I'm not sure but that's my best guess considering they bought it and would more than likely have to sign a contract of liability.

3 0
3 years ago
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