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Veronika [31]
3 years ago
14

A company issued 5-year, 7% bonds with a par value of $200,000. The market rate when the bonds were issued was 6.5%. The company

received $202,000 cash for the bonds. Using the straight-line method, the amount of recorded interest expense for the first semiannual interest period is
Business
1 answer:
Rufina [12.5K]3 years ago
6 0

Answer: $6800

Explanation:

Based on the information that has been given in the question, Interest will be calculated as:

= $200,000 × 7% × 6/12

= $200,000 × 0.07 × 0.5

= $7,000

We then calculate the premium ammortizaion which will be:

= ($202,000 - $200,000) / 5 × 2

= $2000 / 5 × 2

= $2,000 / 10

= $200

Therefore, the interest expense to be recorded will be:

= $7,000 - $200

= $6,800

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katrin [286]

Answer:

Real GDP per capita can increase or decrease when Real GDP increases

Explanation:

Real GDP per capita is calculated by dividing Real GDP by the number of people in a country. Therefore:

  • If population increase more quickly than the increase in real GDP, then real GDP per capita would decrease.
  • If population decreases, stays the same or increases more slowly as Real GDP increases, then real GDP per capita would increase.
4 0
3 years ago
What is gdp expressed in constant, or unchanging, prices called?
horsena [70]
The GDP expressed in constant, or unchanging prices is called real GDP. 
Real GDP or Real Gross Domestic Product is the measurement of the value of economic output modified for the changes of prices like inflation or deflation.  This modification will transform the measure of the money-value, nominal GDP, into an index intended quantity of total output.
4 0
3 years ago
Read 2 more answers
Anson Jackson Court Company (AJC) The Anson Jackson Court Company (AJC) currently has $200,000 market value (and book value) of
ddd [48]

Answer:

7.38%

Explanation:

Calculation to determine what would be AJC's new WACC and total value

Using this formula

WACC and total value=(Equity)(Required rate of return on equity)+(Debt)(1-Tax rate)(Required rate of return on debt)

Let plug in the formula

WACC and total value=(0.6)(0.095)+(0.4)(1-0.4)(0.07)

WACC and total value=0.057+0.0168

WACC and total value=0.0738*100

WACC and total value=7.38%

Therefore would be AJC's new WACC and total value is 7.38%

5 0
2 years ago
Which of the following is not a goal of federal economic policy? full employment growth a high savings rate Keynesian economics
Ivan

Answer:

high savings rate

Explanation:

High savings rate is not a goal of federal economic policy. The goal of federal economic policy is to achieve full employment, economic growth and stable prices.

However 'high savings rate' is achieved when interest rates are increased in order to fight inflation and achieve 'stable prices' because people keep their money in the banks to take advantage of the benefit of earning interest BUT this is not always the case because 'higher interest rates' works against full employment by making it too costly for firms to borrow for investments which will definitely create jobs.

5 0
3 years ago
Cambridge Co. uses the allowance method. During January 2019, Cambridge writes off a $640 customer account balance when it becom
yan [13]

Answer:

The correct answer is option (a).

Explanation:

According to the scenario, computation of the given data are as follows:

Allowance method shows that, if account is written off, then Accounts receivable account gets credited and Allowance accounts gets debited.

Here, both accounts are or balance sheet items.

So, it will not affect any expenses account.

8 0
3 years ago
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