The Correct Response is Option B.
Inflation: can obscure relative price changes.
- In the field of economics, inflation refers to an overall rise in the cost of goods and services throughout a nation. Each unit of currency may purchase fewer products and services as the overall price level rises, hence inflation is associated with a decline in the buying power of money.
<h3><u>What occurs when inflation occurs?</u></h3>
- The main cost of inflation is the loss of real income, which occurs when prices rise unevenly and causes some customers' buying power to decline. For both those who receive and pay fixed interest rates, inflation might over time affect their ability to make purchases.
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Answer:
B
Explanation:
When using the indirect method to prepare the operating section of a statement of cash flows , the gain on sale of land will be deducted from the net income as it has already been included in the net income as the gain on the sales of the land , which was a non cash recognition in the course of the business.
Decrease in receivable means that there was an inflow of cash as some receivables had paid their debts , thus it is added.
The amortization is a non cash expenses that had been deducted which will need to be added back to the net income for the purpose of cash flow.
Answer:
1) total sales revenue = $120,000
this amount holds regardless of how much money was collected in cash or if an account/note receivable was recorded
2) the company must recognize interest revenue:
principal = $72,000
interest revenue = $72,000 x 10% x 40/360 days = $800
Dr Interest receivable 8000
Cr Interest revenue 800
Answer:
7.31%
Explanation:
The question is pointing at the bond's yield to maturity.
The yield to maturity can be computed using the rate formula in excel as provided below:
=rate(nper,pmt,-pv,fv)
nper is the number of times the bond would pay annual coupons which is 31
pmt is the annual coupon payment i.e $1000*8.0%=$80.00
pv is the current price of the bond which is $1,084
fv is the face value of the bond which is $1,000
=rate(31,80,-1084,1000)=7.31%
The yield to maturity is 7.31%
That is the annual rate of return for an investor that holds the bond till maturity.
