Ellis Company issues 6.5%, five-year bonds dated January 1, 2019, with a $250,000 par value. The bonds pay interest on June 30 and December 31 and are issued at a price of $255,333. The annual market rate is 6% on the issue date. Required
1. Compute the total bond interest expense over the bonds’ life.
2. Prepare an effective interest amortization table for the bonds’ life.
3. Prepare the journal entries to record the first two interest payments.
Answers
Answer:
Hence the answer is given as follows,
Explanation:
Related Questions
William's Co. is considering spending $15,000 at Time 0 to test a new product. Depending on the test results, the firm may decide to spend $58,000 at Time 1 to start production of the product. If the product is introduced and it is successful, it will produce aftertax cash flows of $45,000 a year for Years 2 through 4. The probability of successful test and investment is 62 percent. What is the net present value at Time 0 given a 14 percent discount rate
Answers
Answer:
$10,275.03
Explanation:
Years 0 1 2 3 4
Cash flow -15000 -58000 45000 45000 45000
Successful chance result (62%) -9300 -35960 27900 27900 27900
Considered cash flow -15000 -35960 27900 27900 27900
Discount factor (14%) 1 0.877 0.769 0.675 0.592
Present value -15000 (31,543.86) 21,468.14 18,831.71 16,519.04
Net present value = -$15000 - $31,543.86 + 21,468.14 + 18,831.71 + 16,519.04
Net present value = $10,275.03
An organizational structure is Multiple Choice the arrangement or relationship of positions within an organization. based on the company's shared beliefs and values. usually not seen in government and nonprofit organizations. only applicable to formal organizations. fixed, even if the company grows in size.
Answers
Answer:
the arrangement or relationship of positions within an organization.
Explanation:
The organizational structure corresponds to the arrangement or relationship of positions within an organization, that is, the structure refers to the company's structure by department, position and function, which makes up the organizational hierarchy.
The structure is not fixed, it can be changeable according to the objectives and goals of a company, but to change it it is necessary to share the vision with the stakeholders and analyze the change, since the organizational structure also establishes the culture and the form of relationship within a company.
In the centralized structure, decision-making occurs hierarchically from the highest to the lowest positions, whereas in the decentralized structure, the lower hierarchical levels also participate in the decision-making process, requiring the alignment of the organizational structure with the values and objectives of the company.
Employees are quitting at an alarming rate from a classy multi-star hotel. What can the HR team there do to find out the reason for quitting and retain good employees?
Answers
The Human resources team can interact with some of the staffs to know the problem.
Who is an employee?An employee is someone who is working for an organization or an individual to gets paid at the end of the job either as wages or salary.
In case of any problem, Human resources team can interact with some of the staffs to know the problem.
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Answer: I believe the answer is C
Explanation:
9. Bayarmaa owns land with an adjusted basis of $610,000 subject to a mortgage of $350,000. On April 1, Bayarmaa sells her land subject to the mortgage for $650,000 in cash, a note for $600,000, and property with a fair market value of $120,000. What is the amount realized
Answers
Answer:
610000-b=a
Explanation:
April 1=610000
Bayarmaa owns land with an adjusted basis of $610,000 subject to a mortgage of $350,000. The amount realized is $1,720,000. The correct option is b.
What are taxes?Taxes are necessary contributions levied by a government entity, whether local, regional, or national, on individuals or corporations. Taxation funds government activities such as public works and services such as roads and schools, as well as programs such as Social Security and Medicare.
The amount realized by Alice is equal to the assumed property tax
Cash = $650,000
Note = $600,000
Property for market value = $120,000
Mortgage debt = $350,000
Prorated property tax = 9000 x 31 + 28 + 31 / 365 days = 2,219
Adding all the money = 1722, 219
Therefore, the correct option is b. $1,720,000.
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The question is incomplete. Your most probably complete question is given below:
a. $1,370,000
b. $1,720,000
c. $1,820,000
d. $1,250,000
Aaron Company has a process costing system. All materials are introduced when conversion costs reach 50 percent. The following information is available for physical units during March. Work in process, March 1 (60% complete as to conversion costs) 150,000 Units started in March 600,000 Units transferred to Finishing Department in March 630,000 Work in process, March 31 (40% complete as to conversion costs) 120,000 Required: a. Compute the equivalent units for materials costs and for conversion costs using the weighted-average method. b. Compute the equivalent units for materials costs and for conversion costs using the FIFO method. c. The company president has been under considerable pressure to increase income. He tells the controller to change the estimated completion for ending work in process to 60 percent (from 40 percent). c-1. What effect will this change have on the unit costs of units transferred to finished goods in March
Answers
Answer:
Aaron Company
a. Weighted-average
Equivalent units of production Units Materials Conversion
Units transferred to Finishing 630,000 630,000 (100%) 630,000 (100%)
Work in process, March 31 120,000 0 (0%) 48,000 (40%)
Equivalent units 630,000 678,000
b. FIFO:
Equivalent units of production Units Materials Conversion
Work in process, March 1 150,000 0 60,000 (40%)
Units started and completed 480,000 480,000 (100%) 480,000 (100%)
Work in process, March 31 120,000 0 (0%) 48,000 (40%)
Equivalent units 480,000 588,000
c. The change will reduce the unit costs of units transferred to finished goods in March.
Explanation:
a) Data and Calculations:
Work in process, March 1 (60% complete as to conversion costs) 150,000
Units started in March 600,000
Units transferred to Finishing Department in March 630,000
Work in process, March 31 (40% complete as to conversion costs) 120,000
a. Weighted-average
Equivalent units of production Units Materials Conversion
Units transferred to Finishing 630,000 630,000 (100%) 630,000 (100%)
Work in process, March 31 120,000 0 (0%) 48,000 (40%)
Equivalent units 630,000 678,000
b. FIFO:
Equivalent units of production Units Materials Conversion
Work in process, March 1 150,000 0 60,000 (40%)
Units started and completed 480,000 480,000 (100%) 480,000 (100%)
Work in process, March 31 120,000 0 (0%) 48,000 (40%)
Equivalent units 480,000 588,000
c. If the estimated completion for ending work in process is changed to 60% from 40%, the equivalent units of production for materials will increase by 120,000. This increase will also increase the cost of ending work in process and reduce the unit costs transferred to finished goods in March.
What would be the return on total assets of a firm if net income is $50,000, total sales are $100,000, and total assets are $175,000
Answers
Answer: 28.6%
Explanation:
The return on the total asset of a firm will be calculated as the net income divided by the total asset and this will be:
=Net income / Total assets
=50,000/175,000
=28.6%
Therefore, return on total asset is 28.6%
Ethics Learning to recognize ethical issues is the most important step in understanding business ethics.
a. True
b. False
Answers
Answer:
A) True
Explanation:
Ethical learning can be regarded as educational proposal that has the purpose of preparing students as regards their future working life , through rendering of help to acquire skills that will give them enablement to perform their professions with responsibility as well as autonomy.
Business ethics can be regarded as study of needed business policies as well as business practices. Subject needed to learn could involves could be corporate social responsibility,corporate governance and others. It should be noted that Ethics Learning to recognize ethical issues is the most important step in understanding business ethics.
Smiley Corporation wholesales repair products to equipment manufacturers. On April 1, 20Y1, Smiley issued $1,400,000 of 4-year, 7% bonds at a market (effective) interest rate of 6%, receiving cash of $1,449,138. Interest is payable semiannually on April 1 and October 1.
Required:
A. Journalize the entries to record the following. Refer to the Chart of Accounts for exact wording of account titles.
1. Issuance of bonds on April 1.
2. First interest payment on October 1 and amortization of bond premium for six months, using the straight-line method. The bond premium amortization is combined with the semiannual interest payment. (Round to the nearest dollar.)
B. Explain why the company was able to issue the bonds for $20,811,010 rather than for the face amount of $20,000,000.
Answers
Answer:
A1.Apr.1
Dr Cash $1,449,138
Cr Premium on Bonds Payable $49,138
Cr Bonds Payable $1,400,000
A2. Oct. 1
Dr Interest Expense $24,431
Dr Premium on Bonds Payable $24,569
Cr Cash $49,000
B. The BONDS was paying HIGHER INTEREST RATE of 7% to the MARKET INTEREST RATE of 6%.
Explanation:
A1. Preparation of the journal entry to record Issuance of bonds on April 1Apr.1
Dr Cash $1,449,138
Cr Premium on Bonds Payable $49,138
($1,449,138-$1,400,000)
Cr Bonds Payable $1,400,000
(To record Issuance of bonds)
A2. Preparation of the journal entry to record First interest payment on October 1 and amortization of bond premium for six months, using the straight-line method.
Oct. 1
Dr Interest Expense $24,431
($49,000-$24,569)
Dr Premium on Bonds Payable $24,569
[($1,449,138-$1,400,000)4*2]
Cr Cash $49,000
( $1,400,000 x 7% x 6/12)
(To record First interest payment and amortization of bond premium )
B. Based on the information given the reason
WHY the company was able to issue the bonds for $20,811,010 RATHER THAN for the FACE AMOUNT of $20,000,000 was because the BONDS was paying HIGHER INTEREST RATE of 7% to the MARKET INTEREST RATE of 6%.
Year 1 Year 2 EBITDA $7,650 $9,150 Total value of equity $76,500 $82,500 Total firm value $99,450 $132,000 What is value of the entity multiple of Company X in Year 1?
Answers
Answer:
$5.59
Explanation:
Calculation to determine the value of the entity multiple of Company X in Year 1
Using this formula
Entity multiple=Market value / EBITDA
Let plug in the formula
Entity multiple=$99,450/$17800
Entity multiple=$5.59
Therefore the value of the entity multiple of Company X in Year 1 will be $5.59
A 15-year semi-annual coupon bond pays a coupon rate of 7%. The par value of the bond is $1,000. If similar bonds are currently yielding 6%, what is the market value of the bond
Answers
Answer:
Bond Price= $1,098.01
Explanation:
Giving the following information:
Coupon= (0.07/2)*1,000= $35
YTM= 0.06/2= 0.03
n= 15*2= 30
Face value= $1,000
To calculate the price of the bond, we need to use the following formula:
Bond Price= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]
Bond Price= 35*{[1 - (1.03^-30)] / 0.03} + (1,000 / (1.03^30)]
Bond Price= 686.02 + 411.99
Bond Price= $1,098.01
On the basis of the following information taken from the Adjusted Trial Balance columns of the end-of-period spreadsheet for the month ended September 30, journalize the closing entries for Perez Roofing Company.
Perez Roofing Company
Adjusted Trial Balance
September 30
Account Title Debit Credit
Cash 22,500
Accounts Receivable 3,575
Office Supplies 2,850
Repair Parts 3,785
Machinery 17,750
Accumulated Depreciation 3,250
Accounts Payable 1,150
Notes Payable 6,500
Common Stock 1,500
Retained Earnings 1,000
Dividends 1,750
Service Revenue 47,200
Wages Expense 4,840
Office Supplies Expense 1,275
Repair Parts Expense 925
Depreciation Expense 1,350
60,600 60,600
Answers
Answer:
Perez Roofing Company
Closing Journal Entries:
September 30:
Debit Service Revenue $47,200
Credit Income Summary $47,200
To close service revenue to income summary.
Debit Income Summary $8,390
Credit:
Wages Expense $4,840
Office Supplies Expense $1,275
Repair Parts Expense $925
Depreciation Expense $1,350
To close expenses to income summary.
Debit Income summary $38,810
Credit Retained Earnings $38,810
To close income summary to Retained Earnings.
Debit Retained Earnings $1,750
Credit Dividends $1,750
To close dividends to Retained Earnings.
Explanation:
a) Data and Calculations:
Perez Roofing Company
Adjusted Trial Balance
September 30
Account Title Debit Credit
Cash 22,500
Accounts Receivable 3,575
Office Supplies 2,850
Repair Parts 3,785
Machinery 17,750
Accumulated Depreciation 3,250
Accounts Payable 1,150
Notes Payable 6,500
Common Stock 1,500
Retained Earnings 1,000
Dividends 1,750
Service Revenue 47,200
Wages Expense 4,840
Office Supplies Expense 1,275
Repair Parts Expense 925
Depreciation Expense 1,350
60,600 60,600
Closing Entries:
Service Revenue $47,200
Wages Expense $4,840
Office Supplies Expense $1,275
Repair Parts Expense $925
Depreciation Expense $1,350
Dividends $1,750
Specter Co. has identified an investment project with the following cash flows. Year Cash Flow 1 $ 810 2 1,110 3 1,370 4 1,500 a. If the discount rate is 11 percent, what is the present value of these cash flows
Answers
Answer:
3620.46
Explanation:
Use basic principles to find the present value of a cash flow
PV(1+i)ⁿ=CF
CF*(1+i)⁻ⁿ=PV
so we would have
[tex]810(1+.11)^{-1}+1110*1.11^{-2}+1370*1.11^{-3}+1500*1.11^{-4}=[/tex]3620.459284
which rounds to 3620.46
The costs of bringing a corporation into existence, including legal fees and promoter fees, are called:
Answers
Answer:
organization expenses.
Explanation:
A corporation can be defined as a corporate organization that has facilities and owns or controls assets used for the production of goods and services in at least one country other than its headquarter (home office) located in its home country.
This ultimately implies that, a corporation is a corporate organization that owns or controls its business in two or more countries.
Some examples of multinational firms are Ap-ple, Volkswagen, G-oogle, Shoprite, Nestlé, Accenture, Shell BP, Chevron etc.
The costs of bringing a corporation into existence, including legal fees and promoter fees, are called organization expenses.
Direct Labor Variances Advanced Micro Devices develops high-performing computing products. Assume one of its processors, Ryzen 7 Pro, has a standard labor time of 0.25 hours and a standard labor rate of $20 per hour. During February, the following activities pertaining to direct labor for Ryzen 7 Pro were recorded: Direct labor hours used 64,000 Direct labor cost $1,248,000 Units of Ryzen 7 Pro manufactured 250,000
(a) Determine the labor rate variance.
(b) Determine the labor efficiency variance.
(c) Determine the total flexible budget labor cost variance.
Answers
Answer and Explanation:
The computation is shown below:
a. The labor rate variance is
= (standard rate - actual rate) × actual labor hours
= ($20 - $19.50) × 64,000
= $32,000 favorable
b. The labor efficiency variance is
= (standard hours - actual hours) × standard rate
= (62,500 - 64,000) × $20
= -$30,000 unfavorable
c. the total flexible budget variance is
= standard cost - actual cost
= ($1,250,000 - $1,248,000)
= $2,000 favorable
A jogger found a stray dog in the park. She took the dog home with her and placed an ad in the paper to try to find the dog's owner. Soon thereafter, the owner of the dog contacted the jogger. He came to the jogger's home and identified the dog as his. He offered to pay the jogger a $200 reward at the end of the week. The jogger thanked the dog owner but turned down the reward. At the end of the week, however, the jogger changed her mind, so she called the dog owner and told him that she would like the reward after all. He refused to pay her, and she sues him for breach of contract. What will the jogger recover?
Answers
Answer:
The jogger will recover nothing.
Explanation:
The jogger in the context will gain nothing as her [tex]\text{finding the lost dog occurred prior to the owner's promise}[/tex] for the payment of an amount $200.
The enforceable contract is supported by consideration. It consists of bargained for the exchange between the parties. If somethings has already [tex]\text{been given or performed before the promise is made}[/tex], then it will not satisfy the bargain requirement as it will not give in exchange for the promise.
In this case, in the exchange it is not given for the promise, so the jogger was not under any legal obligation for returning the lost dog to its rightful owner.
Thus, the jogger incurred a detriment. The jogger was not been inducted to as to act by the owner of the dog to pay the promised amount of $200.
Assume there is a simultaneous decrease in the incomes of people in the market for new homes and a decrease in the wages paid to carpenters, plumbers, and electricians. All else constant, we can predict, with certainty, that in the market for new homes the equilibrium:
Answers
Answer:
Lower price for new houses.
Explanation:
The decrease in the income of people will decrease the demand for houses and the demand curve will shift leftwards. Meanwhile, the decrease in the wages for carpenters, plumbers, etc will decrease the cost of production so the producer will supply more when the cost of production decreases. So supply curve will shift rightwards. Resulting there will be lower prices due to shifts in the leftward demand curve and rightward supply curve.
The specific pace and quota of work and tight surveillance indicate that company 1 has a(n) _______ culture.
Answers
Question options:
-traditional
-contingency
-androgynous
-mechanistic
-organic
Answer:
mechanistic
Explanation:
The mechanistic culture in an organization is one that works by strict rules, structure and guidelines. It is different from the organic culture that is more open and flexible. Mechanistic organizations are characterized by hierarchy and bureaucracy, specifying labour divisions for it's employees in a formal, close-knitted and "mechanistic" approach. mechanistic organizations can be found among older organizations such as universities, hospitals, government organizations etc. Organic organizations can be found among newer organizations such as tech companies.
In a mechanistic culture-based organization, the specific pace, quota of work and tight surveillance are indicator that the company practice such culture.
The mechanistic culture is usually adopted by organization because its works by strict rules, structure and guidelines.
Mechanistic organizations can be found among older organizations such as universities, hospitals, government organizations etc.
In conclusion, the specific pace and quota of work and tight surveillance indicate that company 1 has a mechanistic culture,
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6. निम्नलिखित पंक्तियों का आशय स्पष्ट कीजिए-
क. संगीत सबका है। इसमें जाति-पाँति का भेदभाव मत लाओ।
Answers
Answer:
yes we should not do any bhedvab towards people becauxe we all are people mademy god if we bully other peoplw we should deserved that .
Which one of the following affects cash during a period?
a. Recording depreciation expense
b. Declaration of a cash dividend
c. Write-off of an uncollectible account receivable
d. Payment of an accounts payable
Answers
Answer: d. Payment of an accounts payable
Explanation:
The payment of an accounts payable affects cash because it means that cash was used to pay off the payable in question and therefore the cash that the company holds has now reduced.
In the Statement of Cashflows, this is accounted for under the Operating Activities of the business. A decrease in accounts payable is subtracted from the net income to show that cash has reduced.
List at least four factors a project manager should consider when identifying individuals to work on a project. Why is each important
Answers
Answer:
The four elements to consider when identifying individuals to be part of a project team:
ability to communicate effectivelySelf Assuredness, experience, and ability, Organizational agilityEmotional IntelligenceExplanation:
1. Communication is essential because in a project if there is a miscommunication between one person, group, or team and another, that could prove fatal to the goal of the project.
Communication is verbal and non-verbal and (in a project and as with most organizations) must happen across both sides of the spectrum horizontally and vertically.
For example, when expectations are not clarified or there are assumptions about what one person or team said or expects, this could lead to project disruption. When too much is also divulged, a project can go belly-up.
2. Experience and ability are key but they are not enough. Each team member must be confident in what they believe is right. Sometimes, senior members of a team may want a course of action (that is detrimental) to be executed. A junior team member who is not self-assured may think, "it's coming from above, what can one do?" this type of thinking can be very costly.
A self-assured team player would stand for what is right and in the best interest of the team and the project even at the risk of being fired.
3. Organisational Agility
It is impossible to keep a messy itenary and achieve project success.
The ability to know exactly what needs to be done in succession is an invaluable trait of project team members. This prevents waste of time and resources.
4. Emotional Intelligence
Successful team players are also successful leaders. The most cohesive teams are teams that comprise of highly emotionally intelligent people. One of the benefits of emotional intelligence is that it helps the individual to know how to regulate their own behaviors as well as respond to those of others. It is also critical to motivating others to get the job done.
Cheers
Farrick and Kenley want to form a business in which they invest money in exchange for stock ownership in their organization. What type of business entity do they wish to form
Answers
Answer:
Limited liability company
Explanation:
In simple words, A limited liability corporation (LLC) is a type of private company structure. It's among the most frequent legal structures for forming a company. In a comprehensive partnerships all members are accountable for the firm and have unlimited accountability for its obligations.
Thus the limited liability structure is most suitable for the two.
Spirit Company's sales budget shows quarterly sales for the next year as follows: Unit sales Quarter 1.......... 10,000 units Quarter 2.......... 8,000 units Quarter 3.......... 12,000 units Quarter 4.......... 14,000 units Company policy is to have a finished goods inventory at the end of each quarter equal to 20% of the next quarter's sales. Budgeted production for the second quarter of the next year would be:
Answers
Answer:
8,800 units
Explanation:
Calculation to determine what Budgeted production for the second quarter of the next year would be:
Second Quarter - Sales 8,000
Less: Beginning Finished Goods
(8,000 x 20%) (1,600)
Add: Desired Ending Finished Goods (12,000 x 20% ) 2,400
Budgeted Production 8,800 units
(8,000-1,600+2,400)
Therefore Budgeted production for the second quarter of the next year would be:8,800 units
Consider the following projects. Project CO C1 C2 СЗ C4 C5 A -1,000 +1,000 0 0 0 10 B -2,000 |+1,000 |+1,000 +4,000 +1,000 +1,000 C -3,000 |+1,000 |+1,000 0 +1,000 +1,000 Assume that this firm's beta= 1.5 The expected market return is 12%. The risk free rate is 2.5%. This company can borrow debt at 5.2%. The firm has $5 billion in debt. It has 6 billion shares outstanding at $3 price/shr. The corporate tax rate (Tc) = 21% Question: What is the NPV of project B?a) $3,458
b) -$128
c) -$122
d) $2,158
Answers
Answer:
a) $3,458
Explanation:
The net present value is the present value of future cash flows discounted at the firm's weighted average cost of capital(which is the appropriate discount rate in this case) minus the initial investment outlay
cost of equity=risk-free rate+beta*(expected market return-risk free rate)
cost of equity=2.5%+1.5*(12%-2.5%)
cost of equity=16.75%
after-tax cost of debt=5.2%*(1-21%)
after-tax cost of debt=4.11%
WACC=(weight of equity*cost of equity)+(weight of debt*after-tax cost of debt)
weight of equity=value of equity/(value of equity+value of debt)
value of equity=6 billion*$3=$18 billion
value of debt=$5 billion
weight of equity=$18 billion/($18 billion+$5 billion)
weight of equity=78.26%
weight of debt=1-78.26%
weight of debt=21.74%
WACC=(78.26%*16.75%)+(21.74%*4.11%)
WACC=14.00%
present value of a future cash flow=future cash flow/(1+WACC)^n
n is the year in which the cash flow is expected, it is 1 for year 1 cash flow, 2 for year 2 cash flow ,and so on
NPV of project B=1000/(1+14%)^1+1000/(1+14%)^2++4000/(1+14%)^3+1000/(1+14%)^4+1000/(1+14%)^5-2000
NPV of project B=$ 3,458.00
The viewpoint that business should be privately controlled and not controlled by the government is a perspective of a ________ economy.
Answers
Answer:
The viewpoint that business should be privately controlled and not controlled by the government is a perspective of a ____capitalist____ economy.
Explanation:
For example, the US economy provides a good example of a capitalist economy. A capitalist or market economy is also known as capitalism. It is an economic system whereby private individuals or businesses own capital goods or means of production. Therefore, the production of goods and services is based on the market forces of supply and demand. Since individuals and firms fix prices of and decide what goods and services to produce, rather than through central planning by the government, it is also known as a market economy. The opposite is called a command economy, characterized by central government planning.
Oliver's long-term care policy covers only services in a nursing facility and pays nothing for services provided at home or in the community. What kind of LTC policy does Oliver own?
Answers
Question options:
a. facility-challenged
b. substandard
c. tier 1
d. noncomprehensive
Answer:
d. noncomprehensive
Explanation:
Oliver has a noncomprehensive long term care(LTC). A non comprehensive long term care is policy that restricts services to the ones provided at a nursing facility, and so Oliver pays for the benefits of only the services of a nursing facility . It is different from a comprehensive long term care where services cover and can be provided at an adult day care, home, assisted living facilities, or at nursing facilities.
Oliver's policy which does not cover nursing facilities provided at home or in the community is known as a Non-comprehensive health insurance policy. So, the correct option is D.
A non-comprehensive policy is a type of policy that covers only expenses related to the health of the customer that are provided in the hospital in-house premises only.
It is to be noted that there are no nursing facility expenses reimbursed or paid to the policy holder in case of health issues faced, if any. There are several other types of policies which reimburse such expenses.In a non-comprehensive policy, the policy holder is entitled to receive health benefits of only core hospitalization and any other expenses like bedding, medications, out-house nursing facilities, etc.The premium to be paid on the non-comprehensive policy is less compared to a comprehensive policy as the benefits to be availed are also less and so the drill.Hence, the correct option is D that the non-comprehensive policy does not cover nursing facilities taken in-house or at the community.
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To select a strategy in a two-person, zero-sum game, Player A follows a ________ procedure and Player B follows a ________ procedure.
Answers
Answer:
None of these is correct
Explanation:
None of these is correct. The correct answer is that; it should be minimax
To obtain an FHA-insured loan, the buyers will have to pay a MIP of 1.75 points, which will be financed into the loan. What will be the amount of their loan if FHA insures 96.5% of the appraised value and this property appraises for $210,000 (the maximum loan the FHA will insure in their area is $271,000)?
Answers
Answer:
$206,196.38
Explanation:
Calculation to determine what will be the amount of their loan
Loan Amount=($210,000 × 0.965)+[($210,000 × 0.965)×0.0175]
Loan Amount=$202,650+ ($202,650 × 0.0175)
Loan Amount=$202,650 + $3,546.38
Loan Amount= $206,196.38
Therefore What will be the amount of their loan is $206,196.38
Larry estimates that the costs of insurance, license, and depreciation to operate his car total $460 per month and that the gas, oil, and maintenance costs are 33 cents per mile. Larry also estimates that, on average, he drives his car 2,000 miles per month.
Required:
a. How much cost would Larry expect to incur during April if he drove the car 1,545 miles? (Round your answer to 2 decimal places.)
b. Would it be meaningful for Larry to calculate an estimated average cost per mile for a typical 2,000-mile month?
a. Yes
b. No
Answers
Answer and Explanation:
a The computation of the cost is
= $460 + 1,545 miles × 0.33
= $460 + $509.85
= $969.85
b. It should not be considered as the meaningful as the fixed cost would remains the fixed i.e. $460 also the 0.33 per mile should be considered as the variable cost that change with the change in the no of miles covered
Therefore the same should be considered
A company has the following selected account balances: Sales $ 250,000 Sales Discounts 1,500 Sales Returns and Allowances 2,300 Sales Salaries Expense 56,000 Store Supplies Expense 15,000 Advertising Expense 8,000 Cost of Goods Sold 125,000 What is the gross profit that would appear on a multiple-step income statement:
Answers
Answer:
$121,200
Explanation:
The gross profit that would appear on a multiple-step income statement can be determined as :
Gross Profit = Net Sales - Cost of Sales
where,
Net Sales = Sales - Sales Discounts - Sales Returns and Allowances
= $ 250,000 - $1,500 - $2,300
= $246,200
therefore,
Gross Profit = $246,200 - $125,000
= $121,200
The Cullumber Acres Inn is trying to determine its break-even point during its off-peak season. The inn has 50 rooms that it rents at $65 a night. Operating costs are as follows:
Salaries $7,500 per month
Utilities $1,000 per month
Depreciation $1,100 per month
Maintenance $2,940 per month
Maid service $24 per room
Other costs $46 per room
Required:
Determine the innâs break-even point in number of rented rooms per month.
Answers
Answer:
Results are below.
Explanation:
First, we need to calculate the total fixed cost and the total unitary variable cost:
Total fixed cost= salaries + utilities + depreciation + maintenance
Total fixed cost= 7,500 + 1,000 + 1,100 + 2,940
Total fixed cost= $12,540
Total unitary variable cost= 24 + 46
Total unitary variable cost= $70
As the unitary contribution margin is negative (65 - 70), the company will never break even. I will assume that the selling price is incorrect, and the room costs $85:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 12,450 / (85 - 70)
Break-even point in units= 830
