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3 years ago

Preparing Adjusting Entries, Financial Statements, and Closing Entries

Business

1 answer:

strojnjashka [21]3 years ago

3 0

Answer:

1. Cash (Dr.) $145,850

Sales (Cr.) $145,850

2. Purchases (Dr.) $76,200

Accounts Payable (Cr.) $76,200

3. Accounts Payable (Dr.) $4,100

Cash (Cr.) $4,100

4. Prepaid Rent (Dr.) $24,000

Cash (Cr.) $24,000

5. Wages Expense (Dr.) $12,500

Cash (Cr.) $12,500

Wages Expense (Dr.) $350

Wages Payable (Cr.) $350

6. Depreciation Expense (Dr.) $1,700

Accumulated Depreciation (Cr.) $1,700

Explanation:

Journal entries are recorded for the business transactions. These transaction incurred in the business are recorded in the books of accounts. These journal entries then create Ledger and Trial balance.

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Jim has an annual income of $180,000. Jim is looking to buy a house with monthly property taxes of $140 and monthly homeowners i

MariettaO [177]

Answer:

$787,471.02

Explanation:

Given:

Jim's annual income = $180,000

Monthly property taxes = $140

Monthly homeowners insurance = $70

Monthly student loan payments = $178

Maximum front end DTI limit = 28%

Maximum back end DTI limit = 36%

Amortizing period = 30 years = 360 months

annual rate = 4.5% compounded monthly

Now,

Monthly salary = $\frac{\textup{Annual income}}{\textup{12 months}}$

Monthly salary = $\frac{\textup{180,000}}{\textup{12 months}}$

Monthly salary = $15,000

Maximum front end DTI limit

= (Maximum Monthly loan payment + monthly property taxes + monthly homeowner's insurance) ÷ Monthly income

0.28 × $15,000 = Maximum Monthly loan payment + $140 + $70

Maximum Monthly loan payment = $4,200 - $140 - $70

= $3,990

and,

Maximum back end DTI limit =

0.36 × $15,000 = Maximum Monthly loan payment + $140 + $70 + $178

Maximum Monthly loan payment = $5,400 - $140 - $70 - $178

= $5,012

Now,

The monthly payment = minimum of [ $3990, $5012 ]

therefore,

The monthly payment = $3,990

Thus,

The maximum amount of loan = Monthly payment × $[\frac{(1-(1+\frac{r}{k})^{-kn})}{(\frac{r}{k})}]$

here,

k = 12 when compounded monthly

n = 30 years

r = 4.5% = 0.045

The maximum amount of loan = $3,990 × $[\frac{(1-(1+\frac{0.045}{12})^{-12\times30})}{(\frac{0.045}{12})}]$

The maximum amount of loan = $787,471.02

8 0

3 years ago

A property is sold for $350,000. The buyer has paid $12,000 as earnest money and is obtaining a 70% loan. Based on the informati

Zolol [24]

Answer:

$93,000

Explanation:

Data provided in the question:

selling cost of the property = $350,000

Earnest money paid = $12,000

Percentage of loan obtained = 70%

Now,

The amount of loan obtained = 70% of $350,000

= $245,000

Therefore,

Amount to be paid by self

= selling cost of the property - amount of loan obtained

= $350,000 - $245,000

= $105,000

Thus,

Additional cash the buyer will have to bring to the closing day

= Amount to be paid by self - Earnest money paid

= $105,000 - $12,000

= $93,000

7 0

3 years ago

Banks Company sold merchandise on account for $35,000 with terms 2/10, n/30. The cost of goods sold was $27,600. If the invoice

WITCHER [35]

Answer:

The amount of cash received by Banks Company is $34,300

Explanation:

The computation of the cash received by the bank company is shown below:

= Merchandise amount - discount

where,

Merchandise amount is $35,000

And, the discount equal to

= Merchandise amount × discount percentage

= $35,000 × 2%

= $700

Now put these values to the above formula

So, the value would equal to

= $35,000 - $700

= $34,300

3 0

3 years ago

Jimmer’s nominal income will go up by 10 percent next year. Inflation is expected to be – 2 percent next year. By approximately

kompoz [17]

Answer:

Nominal interest rate (n) = 10% = 0.10

Inflation rate (i) = -2% = -0.02

Real interest rate (r) = ?

Application of Fisher's Equation

(I + n) = (1 + r)(1 + i)

(1 + 0.10) = (1 + r)(1 + -0.02)

1.10 = (1 + r)(0.98)

<u>1.10</u> = 1 + r

0.98

1.1224 = 1 + r

1.1224 - 1 = r

r = 0.1224 = 12.24%

Jimmer's real income will change by 12.24% next year.

Explanation:

In the determination of the rate of change in real income, there is need to apply Fisher's equation. The nominal rate and inflation rate have been given, thus, we will make the real rate the subject of the formula.

3 0

3 years ago

In a 1960s movie, an heiress sends out thousands of letters to shareholders in an attempt to have them vote for her and for the

Vitek1552 [10]

Answer:

The kind of corporate takeover technique implemented in the film is proxy fight.

Explanation:

A proxy fight is termed as a technique where two corporate factions ask the stakeholders for the proxy votes such that the right of voting is transferred.

In this case both the parties, the heiress as well as the opponent is asking for the right of vote from stakeholders so that they can decide the corporate future. This is the key feature of the proxy fight and thus this is the correct option.

6 0

3 years ago