Mountain View Resorts purchased equipment at the beginning of 2021 for $46,000. Residual value at the end of an estimated four- year service life is expected to be $6,100.
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Answer:
The interest revenue that should be reported in the first year, for two months from November to December, on 31 December is $3600.
Explanation:
According to the accrual basis of accounting, the revenues and expenses for a particular period should be recorded in the period to which they relate to rather then when they are received or paid. This means that although the interest will be received on March 1 of the next year, the interest revenue on note receivable for a period of two months from November to December should be recorded in the first year because it has been earned in the first year and it relates to it.
Interest revenue - first year = 270000 * 0.08 * 2/12 = $3600
Using the value-to-book version of the residual income valuation approach, the value-to-book ratio is determined as <u>one plus the present value of future residual ROCE.</u>
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Residual income is the earnings an individual has left in spite of everything private debts and prices are paid in personal finance. Residual earnings are the extent used to assist determine the creditworthiness of an ability borrower.
Basically, it's for the amount of cash that is left over after making the important bills. Residual income is a crucial metric because it is one of the figures that banks and lenders observe earlier than approving loans.
In monetary surroundings, residual earnings are the money that someone has left over after their charges are included every month. Passive earnings, but, nevertheless has the identical definition in a financial environment that it does in online commercial enterprise surroundings.
Learn more about residual income here brainly.com/question/14262217
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Overpricing is a real issue
