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Shalnov [3]
2 years ago
12

What is Equity financing

Business
1 answer:
MakcuM [25]2 years ago
7 0
Equity Financing is when a business owner exchanges a qualified support in the company towards to an investor. Examples that I can name are Initial Public Offering, Small Business Investment Companies, Royalty Financing, and many more that I just listed. I hope it helps to your question and have a blessed day.
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Mercury Inc. purchased equipment in 2019 at a cost of $400,000. The equipment was expected to produce 700,000 units over the nex
Wittaler [7]

Answer:

See explanation section

Explanation:

We know,

Annual depreciation rate under Units-of-production = Depreciable amount/Overall (expected) production

Given,

Purchase value = $400,000

Residual value = $50,000

Expected production = 700,000 units

Depreciable Amount = $(400,000 - 50,000) = $350,000

Annual depreciation rate = $350,000/700,000

Depreciation rate = $0.50

Thrrefore, Accumulated depreciation from 2019 to 2021 = (100,000 + 160,000 + 80,000)*$0.50

= $170,000

We know, Book value of asset = Cost price - Accumulated depreciation

Book value = $400,000 - $170,000 = $230,000

Again, Loss on sale of equipment = Book value - Sales price

Loss on sale of equipment = $230,000 - $210,000

Loss on sale of equipment = $20,000

The journal entry to record the sale =

Debit Cash $210,000

Debit Accumulated Depreciation $170,000

Debit Loss on sale $20,000

Credit Equipment $400,000

7 0
3 years ago
Read 2 more answers
Suppose that you have the option to lease a new car, which you otherwise intend to purchase for $21,000. The lease terms: $3000
slava [35]

Answer:

The amount that will be paid to buy the car is $18,539.43.

Explanation:

This can be calculated using the following 3 steps:

Step 1: Calculation of the present of the monthly payment

Since the payments are made at the beginning of each month, this can be calculated using the formula for calculating the present value (PV) of annuity due given as follows:

PVM = P * ((1 - (1 / (1 + r))^n) / r) * (1 + r) .................................. (1)

Where;

PVM = Present value monthly payments = ?

P = Monthly withdraw = $298

r = monthly financing rate = Financing rate / Number of months in a year = 5.4% / 12 = 0.054 / 12 = 0.0045

n = number of months = 48

Substitute the values into equation (1), we have:

PVM = $298 * ((1 - (1 / (1 + 0.0045))^48) / 0.0045) * (1 + 0.0045) = $12,896.55

Step 2: Calculation of the present of the purchase amount at lease expiration

This can be calculated using the present value formula as follows:

PVP = P / (1 + r)^n  .................................. (2)

Where;

PVP = Present value of the purchase amount at lease expiration = ?

P = Purchase amount at lease expiration = $7000

r = monthly financing rate = Financing rate / Number of months in a year = 5.4% / 12 = 0.054 / 12 = 0.0045

n = number of months = 48

Substitute the values into equation (2), we have:

PVP = $7000 / (1 + 0.0045)^48 = $5,642.88

Step 3: Calculation of the amount that will be paid to buy the car

This can be calculated as follows:

Amount to pay to buy car = PVM + PVP ............... (3)

Where:

PVM = Present value monthly payments = $12,896.55

PVP = $5,642.88

Substitute the values into equation (3), we have:

Amount to pay to buy car = $12,896.55 + $5,642.88 = $18,539.43

Therefore, the amount that will be paid to buy the car is $18,539.43.

5 0
2 years ago
1. The "four Ms" of cause-and-effect diagrams are:______.
dolphi86 [110]

Answer:

1. C.  c. material, machinery/equipment, manpower, and methods.

2. E. All are correct

Explanation:

1. The cause-and-effect diagram also known as the Ishikawa diagram is used by organizations to find out the likely causes of unwanted problems. This diagram traces the roots of problems and helps managers discover the potential causes of these problems. The four M's that form the bone of the diagram to which other causes are traced include the;

a. material, which is about the products used in the production process and potential problems that can be attributed to them.

b. machinery/equipment, which is about the plant and likely problems that can arise from their use.

c. manpower, which is about the personnel used in the production process, and,

d. methods, which is about the systems adopted by the organization.

2. A systematic approach to capacity decisions include;

a. Estimation of capacity requirements

b. Identification of gaps by comparing the expected requirements with available capacity.

c. Develop alternative plans and methods that would help to reduce the gaps.

d. Evaluate the alternatives taking into consideration their qualitative and quantitative attributes.

3 0
3 years ago
If you are sharing the road with an impaired driver it is safest to be
nexus9112 [7]
An impaired driver refers to someone who is under the influence of alcohol and is driving. If you are sharing the road with such a person, it is safest to drive behind such a person. You can take further action by parking beside the road, note down the vehicle's number and then call the appropriate patrol or emergency to inform them about the driver. This will ensure that such a driver is gotten off the highway. 
7 0
3 years ago
“the dry cleaner on the corner is an eyesore.” this is a subjective claim because it
Oxana [17]

‘The dry cleaner on the corner is an eyesore’ is a subjective claim because a subject claim is not something that is factual rather it is an expression or an opinion that an individual says, in which the sentence is an example as it is an expression.

4 0
3 years ago
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