1) First of all, we have that options B and D do not change the net value. It is important to notice that in B, while 4000$ are paid, they already were a liability since they were a known debt; hence, paying it off does not change your net value. Also, paying for a car 16000$ that has the same value does not change the net worth of your assets; it just transforms one asset (16k $) into another (used car). Now, choice A means a negative change of 1500$ and choice E means a positive change of 2000$. Now, in C, we have that the buyer pays 15000$. But the asset he gains loses 20% of its value. Hence, it lose 20%*15000=3000$. Thus, C denotes the biggest change in net worth, since it yields a loss of 3000$.
2) Prime lending rates are more favorable to customers; it means that the bank assumes a lower risk with its money and thus provides a better interest rate to customers with good credit score. Prime lending rates are lower than subprime, since the lower the rate on a loan, the better for the customer. Also, the higher your credit score, the better; so prime rates are offered to customers with high credit scores.
3) The total cost of the house is 200000$. The person pays 20% of the house upfront. Hence, the buyer pays 20%*200000=40000$ upfront. The rest of the sum needs to be paid through a mortgage. Hence, the mortgage needs to have a value of 200000-40000=160000$; we need to subtract the down payment from the total value of the house.
4)In general, in a society that prospers, there is inflation and thus the value of 1$ diminishes over time; in order to account for this, interest rates on loans also can increase over time. Variable rate loans help with this. They usually have a lower initial interest, but the rate can increase or decrease based on the bank and the general financial circumstances. The lower rate is due to the fact that the customer risks that the rate increases by a lot.
5) These are two different loans, despite having the same lump sum and interest. First, the monthly payment on the 15 (year loan) is higher because when we have a big sum, if we divide it up into 15 years, the pieces are larger than if we divide it into 30 years. The monthly payment will be close to double for the 15 relative to the 30. So why prefer it? The point is that because the bank is valuing a quick return of assets, the total interest you pay is smaller in the case of 15, so the cost of the loan is smaller.
6) Let us see which are assets and which are liabilities. We will need to add all assets and then subtract all liabilities to get the net worth. 500$ in a savings account is an asset. Also, 5000$ for retirement is an asset too. However, 500$ credit card debt is a liability and we will need to subtract it. Finally, 6500$ of student loan debt is also a liability. So, Net Worth=NW is equal to: NW=500$+5000$-500$-6500$=-1500$. The correct choice is E.
In Texas, the dual budgeting system consists of separate budgets from The legislative and executive branches. This is further explained below.
<h3>What is a dual budgeting system?</h3>
Generally, Both the legislative and executive arms of government in Texas are responsible for creating their own budgets under the state's dual budgeting system.
In conclusion, Therefore, the dual budget process offers a division of tasks that often has more to do with historical structures, political goals, prospective funding sources, and institutional capabilities than with the actual nature and purpose, including accurate description, of the expenditures themselves.
Usually, companies gives sales discounts to their customers to encourage them to pay on time for goods purchased by them. The aim is to enable the customers make immediate payment upon purchase of goods instead of buying them on credit.
Most businesses would prefer receiving cash immediately their goods are sold hence create an incentive in the form of sales discounts which is meant to encourage customers make prompt payment.
Answer: Keeping a log of business expenses Ignoring earnings from a lawn mowing business (Tax evasion )
Not reporting interest earned on a savings account ( tax avoidance )
Keeping a log of contributions to a charity ( tax avoidance )
Not reporting tips Claiming your dependents as tax deductions ( tax evasion )
Explanation: by keeping a log of expenses and ignoring the income of a lawn business you are deliberately carrying out tax evasion because you are not declaring your total earnings and profits.
By not reporting interest earned on a savings account you are devising a means to pay a lower tax legally.
Keeping a log of donations to charity
this is a perfect example of tax avoidance because by donating to charity you are trying to avoid paying high taxes legally.
By not reporting tips earned you are trying to evade paying additional tax.
B. Usually when you engage in tax evasion you risk exposing yourself to greater cost, which usually higher than normal. Once discovered fine payable can be as much as three times the amount concealed.
In process costing, all of the above are used. Process costing is used for the production of goods that a re homogenous so the cost is the same for all the goods.
First one must visualize the flow of the goods to see the costs they incur at each stage. The equivalent units should then be calculated as this would show the number of units that the cost is being assigned to. Next is to divide the costs incurred by the equivalent units to find the cost per unit. Then calculate the cost of goods manufactured based on the manufactured and ending inventory
