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antoniya [11.8K]
2 years ago
14

A company has $1,500,000 in current assets and $500,000 in current liabilities. The company's current inventory level is $250,00

0, and it plans to issue short-term debt to increase inventory. What is the largest amount of short-term debt the company may issue to increase inventory without dropping the current ratio below 2.0
Business
1 answer:
GalinKa [24]2 years ago
3 0

Answer:

Sorry I didn't know plsssss

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On November 1, 2018, ABC signed a $100,000, 6%, six-month note payable with the amount borrowed plus accrued interest due six mo
Kryger [21]

Answer:

ABC

In recording the payment of the note plus accrued interest at maturity on May 1, 2019, ABC would: __________

Journal Entries:

May 1, 2019:

Debit Interest Payable $1,000

Debit Interest Expense $2,000

Debit Notes Payable $100,000

Credit Cash $103,000

To record the payment of the note plus accrued interest at maturity.

Explanation:

a) Data and Calculations:

November 1, 2018:

6% 6-month Note Payable = $100,000

December 31, 2018:

Accrued interest = $1,000 ($100,000 * 6% * 2/12) for 2 months

May 1, 2019:

Interest Expense = $2,000 ($100,000 * 6% * 4/12) for 4 months

Transaction Analysis on May 1, 2019:

Interest Payable $1,000 Interest Expense $2,000 6% Notes Payable $100,000 Cash $103,000

6 0
2 years ago
On January 1, 2018, Jacob Inc. purchased a commercial truck for $48,000 and uses the straight-line depreciation method. The truc
Archy [21]

Answer:

The amount of loss should Jacob Inc. record on December 31, 2019 is $38,000

Explanation:

Truck Value =  $48,000

Annual depreciation =   ( $48,000 -   $8,000) / 8 = $40,000 / 8= $5,000

First year (2018) = $40,000 - $5,000 =  $35,000

Second year (2019) = $35,000 - $5,000 =  $30,000

Loss  = Truck Value (actual) + estimated residual value=  $30,000 + $8,000 = $38,000

6 0
3 years ago
You own one call option with an exercise price of $30 on Nadia stock. This stock is currently selling for $27.80 a share but is
Shalnov [3]

Answer: 0.755

Explanation:

From the information given, the current per share value of the option if it expires in one year will be calculated as follows:

Firstly, we calculate the present value which will be:

= $28 / ( 1 + 0.05 )

= $28/1.05

= $26.667

The number of options needed will be:

= ( 34 - 28 )/ ( 4-0)

= 6/4

= 1.5

Therefore,

27.80 = (1.5 x Co) + [28 / (1+0.05)]

27.80 = 1.5Co + (28/1.05)

27.80 = 1.5Co + 26.667

1.5Co = 28.0 - 26.667

1.5Co = 1.1333

Co = 0.755

Therefore, the answer is 0.755

5 0
2 years ago
It is early in the year, and Keesha would like to start saving money for next year’s holiday presents. What type of account shou
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She should open a savings account
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2 years ago
An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's Bookstore Income Statement F
yawa3891 [41]

Answer:

The contribution margin for Sam's Bookstore for the first quarter is 0.84 or 84 %

Explanation:

Contribution Margin = Contribution ÷ Sales

Where,

<em>Contribution = Sales - Variable Costs</em>

where,

Sales :

Sales = $ 900,000

Number of Books Sold = $ 900,000 ÷ $50

                                      = 18,000 books

Variable Costs Calculation :

Cost of goods sold                                                           $630,000

Variable selling expenses ($5 × 18,000 books)               $90,000

Variable administrative expenses( 4% × $ 900,000)       $36,000

Total Variable Costs                                                         $756,000

Therefore,

Contribution Margin =  $756,000÷  $ 900,000

                                  = 0.84 or 84 %

7 0
3 years ago
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