Answer:
a. Recording of transactions:
May 7, Accounts Receivable (Dr.) $900
Sales Revenue (Cr.) $900
May 15, Customer service Expense (Dr.) $360
Sales Allowance (Cr.) $360
May 20, Cash (Dr.) $495
Cash Discount (Dr.) $45
Sales Allowance (Dr.) $360
Accounts receivable (Cr.) $900
Explanation:
b. Net Sales :
Total Quote ($180 * 5 ) = $900
Less : Cash Discount 5% = 45
Less : Sales Allowance 40% = 360
Net Sales = $495
c. Outdoor expo will record sales after deducting the cash discount. This discount is availed by customer as repayment is made within 15 days. The sales allowance is subtracted from the gross sales as the compensation is made from the outdoor expo due to mistake from their guide on tour. The net sales reported in Income statement will be $495.
Answer:
d. If the WACC is 9%, Project B's NPV will be higher than Project A's.
Explanation:
The internal rate of return is the return in which the NPV is zero i.e cash inflows equal to the initial investment
While the WACC refers to the cost of capital by considering the capital structure i.e cost of equity, cost of preferred stock and cost of debt by taking their weightage
Now if the WACC is 9% so project B NPV would be higher as compared to project A as we can see that project B IRR is greater than the project A IRR
Therefore option d is correct
Answer:
His annual rate of return on this sculpture is -4.46%.
Explanation:
let PV be the amount invested and after t periods it turns to be FV
FV = PV(1+r)^t
(1+r)^t = FV/PV
1 + r = (FV/PV)^(1/t)
r = (FV/PV)^(1/t) - 1
t is the number of years from 1999 to 2003, t = 2003 - 1999 = 4 years
FV = $10,311,500
PV = $12,377,500
r = ($10,311,500/$12,377,500)^(1/4) - 1
r = -0.0446
therefore, His annual rate of return on this sculpture is -4.46%.
Answer:
$16,800
Explanation:
Calculation to determine how much will the customer receive in each dividend payment
First step is to calculate the ADR
ADR=$560,000 / $56
ADR= 10,000 ADR shares.
Note that U.S. market ADR will be either be 1/5th or $56 per U.S. ADR
Second step is to calculate the Semiannual annual dividend rate per ordinary share
Semiannual annual dividend rate per ordinary share =[(12 BP/2)*1/5th ADR worth ]*$1.40 exchange rate
Semiannual annual dividend rate per ordinary share =(6BP* *1/5th ADR worth)*$1.40 exchange rate
Semiannual annual dividend rate per ordinary share =$1.2per ADR share*$1.40 exchange rate
Semiannual annual dividend rate per ordinary share =$1.68
Now let calculate how much will the customer receive in each dividend payment
Dividend payment = $1.68 per ADR share x 10,000 shares
Dividend payment = $16,800
Therefore how much will the customer receive in each dividend payment is $16,800
The correct answer is true hope this helps!
