Answer: A. She believes the company has become riskier, and therefore increases her required rate of return for the stock.
Explanation:
The formula for the Constant dividend growth model of valuing stock is:
= Next dividend / (Required return - growth rate)
From the formula above, one can tell that if the required return is higher, it would result in a lower value for stock because it would divide the numerator more.
If the analyst believes that the company is riskier and increases the required return, the value would therefore reduce if other measures are kept constant.
Assume you just deposited $1,000 into a bank CD account with one year until maturity. The interest rate on your deposit is 8% and inflation is expected to be 4% over the next year. a. How much money will you have in your bank account at the end of one year
Answer:
amount after 1 year = $1080
Explanation:
given data
deposited = $1,000
interest rate = 8% = 0.08
inflation rate = 4%
solution
we get here amount after one year with 8% of interest rate will become
amount after 1 year = deposited × [tex]( 1 + rate )^{time}[/tex] ................1
put here value
amount after 1 year = $1000 × ( 1 + 0.08)
amount after 1 year = $1080
Several years ago, Alcoa was effectively the sole seller of aluminum because the firm owned nearly all of the aluminum ore reserves in the world. This market was not perfectly competitive because this situation violated the:
Answer:
price-taking assumption.
free entry assumption.
Explanation:
A perfectly competitive market is one in which different firms compete for consumers of their products. The characteristics of the perfectly competitive market are:
- products are nearly identical
- all the firms are price takers. That is they are not able to determine price independently
- buyer knowledge of information about products is perfect and available to all
- free entry and exit to the market
- resources are perfectly mobile
In the given scenario above two of these rules are not obeyed.
Alcoa was effectively the sole seller of aluminum because the firm owned nearly all of the aluminum ore reserves in the world.
So they determine the price ( they are not price takers)
Also since they own nearly all the aluminium reserves there is no free entry for new firms
Consider the following account starting balances and transactions involving these accounts. Use T-accounts to record the starting balances and the offsetting entries for the transactions. The starting balance of Cash is $9,100 The starting balance of Inventory is $4,800 The starting balance of Retained Earnings is $24,700 1. Sell product for $30 in cash with historical cost of $24 2. Sell, deliver, and receive payment of $40 for service 3. Consume good or service and pay expense of $2 What is the final amount in Retained Earnings
Answer: $24,744
Explanation:
Final amount in retained earnings;
= Starting balance + Net income
Net income:
= Sales - Cost of good sold + Service revenue - Expense
= 30 - 24 + 40 - 2
= $44
Final amount in retained earnings:
= 24,700 + 44
= $24,744
In a job order costing system: Select one: A. Each department accumulates costs and then allocates them to all units produced. B. The processes involved in manufacturing products are essentially identical for all products. C. Production generally happens in a "continual flow". D. The end products are relatively homogenous. E. None of the above
Answer:
The correct answer is the option E: None of the above.
Explanation:
To begin with, in the field of business management and accounting the concept known as "Job Order Costing" refers specifically to the system that the managers of a company use in order to establish a better organization when it comes to terms of costing and due to the fact that they tend to be organizations that elaborate products that differ from each other regarding the materials they need to be produced properly. So therefore that this method focuses in the fact the company needs to calculate every cost the best possible for every different product that needs different tasks and jobs.
Hart Corporation owns machinery with a book value of $600,000. It is estimated that the machinery will generate future cash flows of $570,000. The machinery has a fair value of $420,000. Hart should recognize a loss on impairment of
Answer: $180,000
Explanation:
An asset is said to be impaired when the future cashflows that it will bring in are less than the book value and when the fair value of the asset is also less than the book value.
Impairment loss = Book value of asset - Fair value
= 600,000 - 420,000
= $180,000
Roanoke Company produces chocolate bars. The primary materials used in producing chocolate bars are cocoa, sugar, and milk. The standard costs for a batch of chocolate (1,827 bars) are as follows: Ingredient Quantity Price Cocoa 600 lbs. $0.40 per lb. Sugar 180 lbs. $0.60 per lb. Milk 150 gal. $1.70 per gal. Determine the standard direct materials cost per bar of chocolate. If required, round to the nearest cent.
Answer:
Roanoke Company
The standard direct materials cost per bar of chocolate is:
= $0.33.
Explanation:
a) Data and Calculations:
A batch of chocolate = 1,827 bars
Standard Costs for a batch:
Ingredient Quantity Price
Cocoa 600 lbs. $0.40 per lb.
Sugar 180 lbs. $0.60 per lb.
Milk 150 gal. $1.70 per gal.
Ingredient Quantity Price Total Cost
Cocoa 600 lbs. $0.40 per lb. $240.00 (600 * $0.40)
Sugar 180 lbs. $0.60 per lb. 108.00 (180 * $0.60)
Milk 150 gal. $1.70 per gal. 255.00 (150 * $1.70)
Total cost of batch of chocolate = $603.00
Cost per bar = $0.33 ($603.00/1,827)
Binford Corporation's contribution margin ratio is 58%, and its fixed monthly expenses are $94,000. Assume that the company's sales for May are expected to be $178,000.
Required:
Estimate the company's net operating income for May, assuming that the fixed monthly expenses do not change.
Answer:
$9,240
Explanation:
Calculation to Estimate the company's net operating income for May, assuming that the fixed monthly expenses do not change
Using this formula
Net operating income = (CM ratio × Sales) - Fixed expenses
Let plug in the formula
Net operating income= (0.58× $178,000) - $94,000
Net operating income= $103,240 - $94,000
Net operating income= $9,240
Therefore the company's net operating income for May, assuming that the fixed monthly expenses do not change is $9,240
Presented below are definitions of certain terms. Select the appropriate term from the dropdown list. Definitions 1. Quantity of input required if a production process is 100% efficient. 2. Managing by focusing on large differences from standard costs. 3. Record that accumulates standard cost information. 4. Preset cost for delivering a product or service under normal conditions. a. Standard cost card b. Management by exception c. Standard cost d. Ideal standard
Answer:
1. Ideal standard
2. Management by exception
3. Standard cost card
4. Standard cost
Explanation:
Costing is the measurement of the cost of production of goods and services by assessing the fixed costs and variable costs associated with each step of production.
In Financial accounting, a direct cost can be defined as any expense which can easily be connected to a specific cost object such as a department, project or product. Some examples of direct costs are cost of raw materials, machineries or equipments.
On the other hand, any cost associated with the running, operations and maintenance of a company refers to indirect costs. Some examples of indirect costs are utility bill, office accessories, diesel etc.
1. Ideal standard: quantity of input required if a production process is 100% efficient.
2. Management by exception: Managing by focusing on large differences from standard costs.
3. Standard cost card: record that accumulates standard cost information.
4. Standard cost: preset cost for delivering a product or service under normal conditions.
On December 31, Ott Co. had investments in equity securities as follows:
Cost Fair value Lower of cost or fair value
Mann Co. $10,000 $8,000 $8,000
Kemo, Inc. $9,000 $11,000 $9,000
Fenn Corp. $11,000 $9,000 $9,000
$30,000 $28,000 $26,000
The Mann investment is classified as held-to-maturity, while the remaining securities are classified as available-for-sale. Ott does not elect the fair value option for reporting financial assets. Ott's December 31, Year 1, balance sheet should report total marketable debt securities as:_____.
a. $29,000.
b. $26,000.
c. $30,000.
d. $28,000.
Answer:
c. $30,000.
Explanation:
The calculation of the total marketable debt securities reported in the balance sheet is given below;
= Mann Co cost + Kemo Co fair value + Fenn corp fair value
= $10,000 + $11,000 + $9,000
= $30,000
Hence, the total marketable debt securities reported in the balance sheet is $30,000
Therefore the option c is correct
Using the high-low method, the fixed cost is calculated ______. Multiple select question. by adding the total cost to the variable cost using either the high or low level of activity before the variable cost is calculated after the variable cost per unit is calculated
Answer:
is calculated after the variable cost per unit is calculated
Explanation:
Costing is the measurement of the cost of production of goods and services by assessing the fixed costs and variable costs associated with each step of production.
In Financial accounting, fixed cost can be defined as predetermined expenses in a business that remain constant for a specific period of time regardless of the quantity of production or level of outputs. Some examples of fixed costs in business are loan payments, employee salary, depreciation, rent, insurance, lease, utilities, etc.
On the other hand, variable costs can be defined as expenses that are not constant and as such usually change directly and are proportional to various changes in business activities. Some examples of variable costs are taxes, direct labor, sales commissions, raw materials, operational expenses, etc.
Using the high-low method, the fixed cost can only be calculated after the variable cost (VC) per unit is calculated through the application of either the low or high level of activity.
Using the high-low method, the fixed cost is calculated : After the variable cost per unit is calculated.
What is costing?Costing refers to the measurement of the cost of production of goods and services whereby, the fixed costs and variable costs associated with production are examined.
Fixed costs are costs that do not vary with the level of output, while variable cost are cost that varies with the activity level.
Using the high-low method, the fixed cost can only be calculated after the variable cost (VC) per unit is calculated through the application of either the low or high level of activity.
Hence, using the high-low method, the fixed cost is calculated after the variable cost per unit is calculated.
Learn more about costing here : https://brainly.com/question/24516871
Kermit plans to open a boutique. The initial investment is $10,000. He has to spend $1,500 in annual operations and maintenance. The boutique generates $3,000 in revenues every year. Kermit uses a 10 year planning horizon and a MARR of 12%. The correctly calculated Rate of Return for this project is ________________%.
Answer:
8.14
Explanation:
The Rate of Return is 8.14 from my calculations which you can find in the attached file.
Now since the Rate of return is 8.14. Which is less than MARR of 12%, it shows that investment is not good.
Year Initial Annual Maintenance Annual Revenue Total Cash Flow
0 -$10,000 -$10,000
1 -$1,500 $3,000 $1,500
2 -$1,500 $3,000 $1,500
3 -$1,500 $3,000 $1,500
4 -$1,500 $3,000 $1,500
5 -$1,500 $3,000 $1,500
6 -$1,500 $3,000 $1,500
7 -$1,500 $3,000 $1,500
8 -$1,500 $3,000 $1,500
9 -$1,500 $3,000 $1,500
10 -$1,500 $3,000 $1,500
Internal Rate of Return 8.1442% [IRR() in excel]
The rate of return is 8.1442 which is less than MARR of 12% investment is not worth it
The lender charges you $9 per week for each $100 you borrow.
Assuming you borrow $300 for 2 weeks, what APR will you be paying?
Answer:
i believe 2,107.5711%
Explanation:
Bearington Enterprises uses an activity-based costing system to assign costs in its auto-parts division.
Activity Est. Indirect Activity Costs Allocation Base Cost Allocation Rate
Materials $60,000 Material moves $5.00/move
Assembling $175,000 Direct labor hours $5.00/dir. labor hour
Packaging $70,000 # of finished units $2.50/finished unit
The following units were produced in December with the following information:
Part # # Produced Materials Costs # Moves Dir. Labor Hrs.
Part 001 1,350 $2,500 100 500
Part 002 5,500 $5,000 400 200
Part 003 4,050 $7,000 2,800 1,550
Total manufacturing costs for Part 003 are : _______
Answer:
the Total manufacturing costs for Part 003 is $38,875
Explanation:
The computation of the Total manufacturing costs for Part 003 is given below:
= material cost + indirect cost
= $7000 + (2,800 × $5) + (1550 × $5) + (4,050 × $2.50)
= $7,000 + $14,000 + $7,750 + $10,125
= $38,875
Hence, the Total manufacturing costs for Part 003 is $38,875
The same should be considered and relevant
The January 1, Year 1 trial balance for the Tyrell Company is found on the trial balance tab. The beginning balances are assumed. Tyrell Co. entered into the following transactions involving short-term liabilities. (Use 360 days a year.) Year 1.
Apr. 20 Purchased $40,250 of merchandise on credit from Locust, terms n/30.
May 19 Replaced the April 20 account payable to Locust with a 90-day, 10%, $35,000 note payable along with paying $5,250 in cash.
July 8 Borrowed $80,000 cash from NBR Bank by signing a 120-day, 9%, $80,000 note payable.
Aug. 17 Paid the amount due on the note to Locust at the maturity date.
Nov. 5 Paid the amount due on the note to NBR Bank at the maturity date.
Nov. 28 Borrowed $42,000 cash from Fargo Bank by signing a 60-day, 8%, $42,000 note payable.
Dec. 31 Recorded an adjusting entry for accrued interest on the note to Fargo Bank. Year 2
Jan. 27 Paid the amount due on the note to Fargo Bank at the maturity date.
Required:
Prepare the 2016 journal entries related to the notes and accounts payable of Tyrell Co.
Answer:
Tyrell Company
Journal Entries:
2016
Apr. 20 Debit Inventory $40,250
Credit Accounts Payable (Locust) $40,250
To record the purchase of inventory on account, terms n/30.
May 19 Debit Accounts Payable (Locust) $40,250
Credit 10% Note Payable (Locust) $35,000
Credit Cash $5,250
To record the issuance of note payable for 90 days and cash payment.
July 8 Debit Cash $80,000
Credit 9% Note Payable (BR Bank) $80,000
To record the borrowing on note payable for a 120-day period.
Aug. 17 Debit 10% Note Payable (Locust) $35,000
Debit Interest Expense $875
Credit Cash $35,875
To record payment on account, including interest calculated as follows: ($35,000 + $35,000 * 10% * 90/360)
Nov. 5 Debit 9% Note Payable (BR Bank) $80,000
Debit Interest Expense $2,400
Credit Cash $82,400
To record payment on account, including interest calculated as follows:
($80,000 + $80,000 * 9% * 120/360)
Nov. 28 Debit Cash $42,000
Credit 8% Notes Payable (Fargo Bank) $42,000
To record the borrowing on note payable for a 60-day
Dec. 31 Debit Interest Expense $308
Credit Interest Payable $308
To accrue interest ($42,000 * 8% * 33/360).
Explanation:
a) Data and Analysis:
2016
Apr. 20 Inventory $40,250 Accounts Payable (Locust) $40,250 terms n/30.
May 19 Accounts Payable (Locust) $40,250 10% Note Payable (Locust) $35,000 Cash $5,250
July 8 Cash $80,000 9% Note Payable (BR Bank) $80,000 a 120-day
Aug. 17 10% Note Payable (Locust) $35,000 Interest Expense $875 Cash $35,875 ($35,000 + $35,000 * 10% * 90/360)
Nov. 5 9% Note Payable (BR Bank) $80,000 Interest Expense $2,400 Cash $82,400 ($80,000 + $80,000 * 9% * 120/360)
Nov. 28 Cash $42,000 8% Notes Payable (Fargo Bank) $42,000 a 60-day
Dec. 31 Interest Expense $308 ($42,000 * 8% * 33/360) Interest Payable $308
2017
Jan. 27 8% Notes Payable (Fargo Bank) $42,000 Interest Payable $308 Interest Expense $252 Cash $42,560
Inventory balances for the Jameson Company in October 2018 are as follows:
October 1, 2018 October 31, 2018
Raw materials $27,000 $21,000
Work in process 48,000 37,200
Finished goods 108,000 90,000
During October, purchases of direct materials were $36,000. Direct labor and factory overhead costs were $60,000 and $84,000, respectively. What are the total manufacturing costs added to production in the period?
Answer:
Total manufacturing costs added to production $186,000
Explanation:
The computation of the total manufacturing cost to be added is given below:
Raw materials,beginning $27,000
Add: Purchases of direct materials $36,000
Less: Raw materials,ending -$21,000
Direct materials used $42,000
Direct labor $60,000
Factory overhead costs $84,000
Total manufacturing costs added to production $186,000
The Japanese economy has been experiencing slow growth. As a result the Prime Minister, who thinks John Maynard Keynes was the greatest economist ever, has decided to increase government spending. As head of the economic council the Prime Minister asks you to determine the size of the increase needed to bring the economy to full employment.
Assume there is a GDP gap of 1 billion yen and the marginal propensity to consume (MPC) is .60. What advise do you give the Prime Minister?
a. The recessionary gap is equal to 625 million yen.
b. The inflationary gap is equal to 1 billion yen divided by 2.5 or 0.4 billion yen.
c. The recessionary gap is equal to 1 billion yen divided by 2.5 or 0.4 billion yen.
d. The inflationary gap is equal to 1 billion yen divided by 1.66 or 0.625 billion yen.
Answer:
c. The recessionary gap is equal to 1 billion yen divided by 2.5 or 0.4 billion yen.
Explanation:
The computation is shown below:
The multiplier is
= 1 ÷ (1 - MPC)
= 1 ÷ (1 - 0.60)
= 2.5
Now the increase in government expenditure for closing out the recessionary gap should be
Change in income = change in government purchase × multiplier
100 = change in government purchase × 2.5
So, the change in government purchase should be
= 100 ÷2.5
= 40
Hence, the option c is correct
Paid for wages Rs. 2000 and for commission Rs. 3000. Journal entry for this?
Answer:
Wages A/c Dr.
To cash A/c
(being wages paid)
Commission A/c Dr
To cash A/c
(being comission paid)
Assume that Corn Co. sold 7,600 units of Product A and 2,400 units of Product B during the past year. The unit contribution margins for Products A and B are $34 and $59, respectively. Corn has fixed costs of $378,000. The break-even point in units is a.9,450 units b.11,340 units c.7,560 units d.14,175 units
,Answer: a. 9,450 units
Explanation:
You need to find the weighted average contribution margin for both products.
Product A
Weighted average contribution margin = Contribution margin * Units sold / Total units sold
= 34 * 7,600 / (7,600 + 2,400)
= $25.84
Product B
= 59 * 2,400 / 10,000
= $14.16
Breakeven point in units = Fixed costs/ (Weighted average contribution margin of both A and B)
= 378,000 / (25.84 + 14.16)
= 9,450 units
Flag
Collective case studies are known as multiple-case studies, cross-case studies, comparative case studies and contrasting case studies. What is a cross-case study?
Answer:
Explanation:
Cross case studies involves the use to several individual case studies in other to support a scientific study or research with the aim of reaching a reasonable and acceptable conclusion which can be generalized and adopted for use in similar cases. Researchers usually employ the use of cross case case study in the formulation of new knowledge by collating several case studies based on the research scenario, then rigorous relationships are examined by comparing and contrasting features of the existing cases.
The purpose of rough cut capacity planning is to: Select one: a. place a time fence around the MPS. b. determine a production schedule that offers a rough order of magnitude. c. cut excess capacity from the MPS. d. assess the feasibility of the MPS. e. govern the length of the execution cycle.
Answer:
The answer is "Option d".
Explanation:
To compute the estimated work on master capacity planning, the objective of basic resource allocation is utilized. It is then contrasted to a proven ability that enhances organizational MPS feasibility.
It verifies that you have enough ability at your disposal that satisfy the needs of your master's programs. It is a tool in long-term production scheduling for marketing and production to accomplish the ratio of the capacity required and accessible and to manage changes in the plan and/or looking.
WHAT ARE THE BENEFITS OF PHYSICAL ERGONOMICS
Answer:
▫️Increased savings. • Fewer injuries. • More productive and sustainable employees. ...
▫️Fewer employees experiencing pain. • Implementing ergonomic improvements can reduce the risk factors that lead to discomfort.
▫️Increased productivity. • ...
▫️Increased morale. • ...
▫️Reduced absenteeism. •
hope it's help you.....!!!!!!!!!!
plz mark as brain list and follow me #rishu..........!!!!!!!!!!!!!!!!!
Explanation:
Hope it will help you
.
.
.
.
Duane Miller wants to know what price home he can afford. His annual gross income is $67,200. He has no other debt expenses and expects property taxes and insurance to cost $320 per month. He knows he can get a 8.50%, 15 year mortgage so his mortgage payment factor is 9.85. He expects to make a 25% down payment. What is Duane's affordable home purchase price?
a. $107,929.
b. $158,793.
c. $138,207.
d. $209,139.
e. $179,665.
In its closing financial statements for its first year in business, the Runs and Goses Company, had cash of $242, accounts receivable of $850, inventory of $820, net fixed assets of $3,408, accounts payable of $700, short-term notes payable of $740, long-term liabilities of $1,100, common stock of $1,160, retained earnings of $1,620, net sales of $2,768, cost of goods sold of $1,210, depreciation of $360, interest expense of $160, taxes of $312, addition to retained earnings of $508, and dividends paid of $218.
Calculate:
a. Return on equity = __________
b. Return on total assets = __________
c. Gross profit margin = __________
d. Net profit margin = __________
Answer:
return on equality
return on way
return on potos
i will want to know about questio n
i can help you in this field ok bro
helnid is my code way ti go
Return on Equity can be calculated as Return on Equity = Net Income / share holders equity. Return on Equity = 726 /2780. Thus, Return on Equity = 26.11%
What is Return on Equity?The ratio of a company's net income to the equity of its shareholders is known as return on equity (ROE). A company's profitability and the effectiveness of its revenue generation are measured by its return on equity (ROE). A corporation is better at turning its equity financing into profits the higher the ROE.
Although average ratios and those deemed "good" and "poor" might differ significantly from industry to industry, a return on equity ratio of 15% to 20% is typically regarded as good. The ratio would be regarded as low at 5%.
b)Return on Asset Ratio
Return on Asset Ratio = Net Income / Total Assets
Return on Asset Ratio = 726/ 5,320
Return on Asset Ratio = 13.65%
c)Gross Profit Margin
Gross Profit Margin = Gross Profit / Net Sales
Profit Margin = 1,558/ 2,768
Profit Margin =56.29%
d)Net Profit Margin
Net Profit Margin = Net Income / Net Sales
Profit Margin = 726/ 2,768
Net Profit Margin =26.23%
Learn more about Return on Equity, here
https://brainly.com/question/27821130
#SPJ5
It should not usually be clear whether we are describing independent or mutually exclusive projects in the following chapters because when we only describe one project then it can be assumed to be independent.
a. True
b. False
Answer:
false
Explanation:
A mutually exclusive project is a project that if one occurs then the other project cannot occur also at the same time. Mutually exclusive projects are independent projects also
For 2020, Ms. Deming earned wages totaling $225,000.
Required:
1. Calculate any 0.9 percent additional Medicare tax owed, assuming that Ms. Deming is single.
2. Calculate any 0.9 percent additional Medicare tax owed, assuming that Ms. Deming files a joint return with her husband who earned $100,000 of wages for 2019.
Answer:
Additional Medicare is charged on the wages that are higher than $200,000.
1. Medicare owed assuming Ms. Deming is single:
= (225,000 - 200,000) * 0.9%
= 25,000 * 0.9%
= $225
2. Medicare owed assuming Ms. Deming files a joint return with her husband.
When filed together, their wages would be considered jointly.
= ( (100,000 + 225,000) - 200,000) * 0.9%
= 125,000 * 0.9%
= $1,125
Ticketsales, Inc., receives $7,720,000 cash in advance ticket sales for a four-date tour of Bon Jovi. Record the advance ticket sales on October 31. Record the revenue earned for the first concert date of November 5, assuming it represents one-fourth of the advance ticket sales. Ticketsales, Inc. initially records prepaid and unearned items in balance sheet accounts.
View transaction list Journal entry worksheet Record the concert revenues earned. Note: Enter debits before credits. Debit Credit General Journal Date Nov 05
Answer:
When revenue has been received but the service has not been rendered, the revenue will not be recognized and will instead be treated as a liability called unearned revenue.
Date Account Title Debit Credit
Oct. 31 Cash $7,720,000
Unearned Ticket revenue $7,720,000
Date Account Title Debit Credit
Nov. 5 Unearned Ticket Revenue $1,930,000
Ticket Revenue $1,930,000
Working
Ticket revenue = 1/4 * 7,720,000
= $1,930,000
As operations manager, you are concerned about being able to meet sales requirements in the coming months. You have just been given the following production report: JAN FEB MAR APR Units produced 2,250 1,750 2,750 2,950 Hours per machine 318 194 393 315 Number of machines 5 7 6 5 Find the average of the monthly productivity figures (units per machine hour).
Answer: 2.81 per hour
Explanation:
Average monthly productivity = (January productivity + February productivity + March productivity + April productivity) / 4
January productivity:
= Units produced / ( Hours per machine * Number of machines )
= 2,250 / ( 318 * 2 )
= 3.537
February productivity:
= 1,750/ ( 194 * 4 )
= 2.255
March productivity:
= 2,750 / ( 393 * 3 )
= 2.332
April productivity:
= 2,950/ ( 315 * 3)
= 3.121
Average monthly productivity = (3.537 + 2.255 + 2.332 + 3.121)/ 4
= 2.81 per hour
Casey transfers property with a tax basis of $3,800 and a fair market value of $6,800 to a corporation in exchange for stock with a fair market value of $5,250 and $720 in cash in a transaction that qualifies for deferral under section 351. The corporation assumed a liability of $830 on the property transferred. Casey also incurred selling expenses of $461. What is the amount realized by Casey in the exchange
Answer:
$5789
Explanation:
Calculation to determine the amount realized by Casey in the exchange
Fair market value of stock $5250
Add Cash in transaction $ 720
Add Liability which is going to the buyer $ 830
Less Selling expenses ($461)
Amount realized $5789
($5250+$720+$830-$461)
Therefore the amount realized by Casey in the exchange is $5789
Third National Bank has reserves of $20,000 and checkable deposits of $100,000. The reserve ratio is 20 percent. Households deposit $5,000 in currency into the bank, and the bank adds that currency to its reserves. What amount of excess reserves does the bank now have
Answer:
$4000
Explanation:
Fractional banking is a banking system where a portion of customer's deposits is kept as reserves while remaining portion is lent out. The amount kept as reserves is determined by the required reserve ratio set by the Central bank.
Reserve ratio is the percentage of deposits that is required of commercial banks to keep as reserves
Total deposits = $100,000 + $5,000 = $105,000
Required reserves = 0.2 x 105000 = 21,000
total reserves = $20,000 + 5000 = 25,000
excess reserves = 25,000 - 21,000 = 4000
* Distinguish between Accounts Receivable and
Account Payable.
Explanation:
Accounts receivable is money owed to a company by its debtors.
Account payable amounts due to vendors or suppliers for goods or services received that have not been yet paid for.
Answer:
Accounts receivable are the amounts owed to a company by its customers. it is an asset to the company
accounts payable are the amounts that a company owes to its suppliers.it is a liability to the company
Explanation:
