Answer:
D) Sinking fund
Explanation:
A sinking fund is an account established to be used in the settling of debts. The corporate or institution that creates a sinking fund deposits money regularly as a way of saving it for future debt payments. A sinking fund, is in away a savings account that accumulates funds for repaying large and future debts.
Municipal authorities use sinking funds to pay their bond expenses when they mature. The municipal contributes funds in the years leading to the bond's maturity. Sinking funds gives confidence to investors that the municipal will not default on its payments.
Answer:
Gap between the supply curve and the market price.
Explanation:
Producers surplus refers to the surplus that a producer of a commodity can obtain. The producers surplus is the difference between the producer's willingness to accept the price and the actual price they have received.
Producers surplus = Actual market price - Willingness to accept the price
Graphically, it is the area between the upper portion of supply curve and the market price.
Answer:
B) 60,100
Explanation:
Since months have passed between the bond issuance and October 31. The amortization of the premium received depends on the amount of interest recognized. When the effective interest method is used, interest expense is based on the yield rate and the beginning book value.
interest expense = ($1,000,000 + $62,000) x 10% x 6/12 = $53,100
interest payable = $1,000,000 x 11% x 6/12 = $55,000
the difference (bond premium) = $55,000 - $53,100 = $1,900
unamortized bond premium = $62,000 - $1,900 = $60,100
Of the packaged deal. When you ship something, then you get that price.
Answer:
833.33
Explanation:
The fixed annual dividend is $100
The required rate of return on this investment is 12%
Therefore the value for each share can be calculated as follows
= 100/(12/100)
= 100/0.12
= 833.33
Hence the value for each share is 833.33
