Answer:
Price, Reinvestment
Explanation:
The short term investments earns from the favorable increases in the securities whereas the long term investments earns from the favorable increase in the stock price and the dividends earned for the year. So the risk for short term investment would be price risk which is that the price would not be favorable at the time when the firm will sell the securities whereas long term holders will bear more reinvestment risk which is that the firm will not find an equal opportunity if the project stops which will adversely affect the long term investors.
Synergism comes in when two companies combined where their value and their performance will become greater than<span> the sum of the separate individual parts. Synergism originally comes from the Greek word, "synergos" which means working together.</span>
Answer:
debit to Work in Process of $74,000.
Explanation:
When we record entry related to work in process, only directly related cost is charged against work in process.
As work in process is an inventory it is part of assets and assets are recorded with a debit balance.
For this, the work in process shall be debited.
In the given instance direct costs are: Direct labor = $74,000
Thus entry for recording work in process will debit work in process inventory with $74,000.
Answer:
a. Journal entry
b. $18,150
c. $586,850
Explanation:
a. The adjusting journal entry is as follows
Bad debt expense A/c Dr
To Allowance for doubtful debts
(Being bad debt expense is recorded)\
The computation of the bad debt expense is shown below:
= Account receivable × estimated percentage given + debit balance of allowance for uncollectible accounts
= $605,000 × 3% + $4,700
= $18,150 + $4,700
= $22,850
b. The adjusted balance in Allowance for Doubtful Accounts is $18,150
c. The cash realizable value is
= $605,0000 - $18,150
= $586,850
Answer:
Spot rate = 0.3807
Explanation:
Given:
Interest rates in the U.S. = 10% = 0.1
Interest rates in Switzerland = 4% = 0.04
Forward rate = $0.3864
Spot rate = ?
Day ratio = 90 days / 360 days = 0.25 (Assume 360 days in a year)
Computation of Spot rate:
Spot rate = Forward rate[1+(Domestic rate × Day ratio)] / [1+ (Foreign rate × Day ratio)]
Spot rate = 0.3864[1+(0.04 × 0.25)] / [1+(0.10 × 0.25)]
Spot rate = 0.3864[1+0.01] / [1+0.025]
Spot rate = 0.3864[1.01] / [1.025]
Spot rate = 0.390264 / [1.025]
Spot rate = 0.3807