what is the annual cost of financing? a. 12% b. 17.5% c. 10% d. 14%
Q: Determine the present worth of the following cash flows based on an interest rate of 7.46% per year,...
A: ANSWER COMPUTATION OF PRESENT WORTH OF CASH FLOW END OF YEAR FUTURE CASH FLOW(1) PRESENT FACTOR...
Q: Oriole Inc is considering one of three options: (1) paying a S0.43 cash dividend, (2) distributing a...
A: Total Asset- Total assets refer to the whole amount of possessions owned by an individual or entity....
Q: You were assigned to audit the Property, plant and equipment account of your continuing audit client...
A: Office Equipment was acquired at the beginning of 2019. Depreciation on Straight-line method with no...
Q: Required information [The following information applies to the questions displayed below.] Simpson, ...
A: The correct answer for the above mentioned questions in the flowing steps for your reference.
Q: Prince Corporation holds 75 percent of the common stock of Sword Distributors Inc., purchased on Dec...
A: Journal entry refer to recording of transactions into the day book of the company and it is vital st...
Q: Convert the following cash flows to an equivalent single payment at t=6 when i=7%. $1500 $1250 $1250...
A: In the given question, different sums are received during different periods. If these are to be conv...
Q: The Leto Construction Company began work on a $15,000 contract on 1/1/22. Planned completion was in ...
A: The correct answer is d. Current Liability of $875
Q: Bulldogs Inc., a corporation that can only legally issue ordinary shares with par value, recently co...
A: New par value per share = Current par value per share x 1/ stock split ratio where, Current par valu...
Q: Required information [The following information applies to the questions displayed below.] Stephanie...
A: Introduction: According to IRS, babysitters should report their income during filling their taxes if...
Q: Bulldogs Inc. currently fills mail orders from all over the country and receipts were received in it...
A: Estimated net annual savings in implementing the lockbox system = Savings in interest - Annual cost ...
Q: 10-13 Jesper, Inc., has a number of divisions including a Furniture Division and a Motel Division. T...
A: Transfer price- The transfer price is the price used in a transaction between individuals inside the...
Q: X Company Y Company Amount Percent Amount Percent Sales $ 148,000 100.00 $ 148,000 100.00 Variable c...
A: Break even sales = Fixed costContribution margin ratio = $70,20070% = $100,286
Q: 3. Which of the following is true in regards to the reassessment of the lease term? A. If the lessee...
A: Lease agreement is a type of agreement between a lessor and a lessee whereby a lessor allows the les...
Q: Tencent Corporation has a target capital structure of 70 percent common stock,5 percent preferred st...
A: Given that the capital structure as below: Common stock = 70% Preferred stock = 5% Debt = 25%
Q: hen the effective cost of d
A: Cost of debts is the effective rate which is given by a company for paying on its debt.
Q: Scoresby Incorporated tracks the number of units purchased and sold throughout each year but applies...
A: Inventory costing can be define as the process in which management of a company valued their invento...
Q: Parent Corporation issued on March 31, 2021 500,000 shares of its P10 par ordinary shares, P40 marke...
A: Calculation of Consideration paid: a Number of shares outstanding of A Company 220,000.00 =550000...
Q: Catalina Corporation begins the year with a $195 balance in Retained Earnings and a $320 balance in ...
A: Stockholder's equity: It implies to the net assets (assets - liabilities) that have shareholder's cl...
Q: Catalina Corporation begins the year with a $195 balance in Retained Earnings and a $320 alance in C...
A: Stockholder equity includes number of outstanding shares ,retained earning and additional common sto...
Q: When a business has made enough money to pay its costs and begin to make a profit
A: Cost is the amount that is incurred in the production process of the company. Whereas, profit repres...
Q: Panthers Corp. purchased 16,000 shares of Canes Corp. for $10 per share on April 1, 2022. As per IFR...
A: The Journal entries is given below
Q: Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fa...
A: Factory overhead also called manufacturing overhead, cost incurred during manufacturing process, wh...
Q: Requirement 1. What are the benefits of setting cost standards? Standard costing helps managers do t...
A: Solution:- Given, Bargain Inc., produced 1000 units Direct materials was three yards of cloth per u...
Q: Drexler incurred P234,000 of experimental and development costs in its laboratory to develop a paten...
A: The amortization expense is charged on intangible assets such as patent, goodwill, etc.
Q: Sleepy Time is a retailer of luxury bed frames located in Los Angeles, California. Due to a recent i...
A: In this question we have to calculate operating income.
Q: 21. Parent company acquired 15% of subsidiary company's common stock for 500,000 cash and carried th...
A: Consolidation statement:- When one company takes over another company's share by paying purchase con...
Q: Case 6
A: As per protocol, allowed to answer first three subpart and post the remaining in the next submission...
Q: answer no. 17 only, pleasee, I only need the schedule of safe payments
A: Before answering we must have a knowledge of the following: Installment Liquidation: Under this meth...
Q: Wildhorse Co. just took its physical inventory on December 31. The count of inventory items on hand ...
A: Lets understand the basics. When inventory sent on consignment basis then inventory needs to be coun...
Q: Why do you think it is important to know the origin of accounting? 2. In your own understanding, wh...
A: Accounting is the process in which transactions of the business are recorded and in the end result o...
Q: On August 1, Vermillion Ltd. accepted a $27,800 note from Borges Ltd. in settlement of an account re...
A: Interest accrued = Face value of notes x rate of interest x no. of months / 12 months
Q: When a company uses the the effective-interest method to amortize a bond discount amortization, the ...
A: As per effective interest method, there are two ways of recognizing the interest expense. first the ...
Q: In this chapter, we learned that FICA mandates that employers deduct taxes from employees' pay each ...
A: Since the year for the calculation of taxes is not given it is taken as Year 2022.
Q: At the beginning of the year, the AAA of Rose, Inc. shows a balance of $682,000. During the year, th...
A: I am answering the first question out of multiple submitted questions as per bartleby guidelines. Pl...
Q: Question 10 Your federal income tax rate is 29%. Your province income tax rate is 17.5%. The provinc...
A: Hi, there, Thanks for posting the question. As per our Q&A honour code, we must answer the first...
Q: Dow Deep Mining Co acquired mineral rights for S56,000,000. The mineral deposit is estimated at 70,0...
A: Formula: Depletion rate per ton = Mineral rights value / Estimated Tons
Q: On January 1,2020, Cielo Company leased an equipment from a lessor with the following pertinent info...
A: Annual rental payable at the end of each year P5,00,000 Lease Term 8 years Implicit interest rat...
Q: Consider the following data for Martin Manufacturing during the month of November: Stan...
A: Answer) Calculation of Material Price variance Material price variance = (Standard price per pound o...
Q: After a long dispute, AA, BB, and CC decided to liquidate their partnership. Their capital balances ...
A: The correct answer for the above question is given in the following steps for your reference
Q: Is: On January 2, year 1, ABC Company purchased 75% of XYZ's outstanding common stock. On that date,...
A: In the given question, since ABC has not issued any fresh common stock, therefore, the amount of com...
Q: Domingo Corporation uses the weighted-average method in its process costing system. This month, the ...
A: Ending work in process inventory is the inventory held at the closing date which is not yet complete...
Q: How much is the consolidated net income? How much is the consolidated retained earnings at December...
A: Growth Corporation acquired an 70% interest in Expanded Company on January 1, 2022 for P245,000. The...
Q: The retained earnings immediately after the combination is!
A: Retained Earnings immediately after the combination includes: a)Parent Company Pre combination Retai...
Q: When a preference share is cumulative and non-participating Any dividends not distributed from the...
A: The preference shareholders get the dividend before dividend is paid to ordinary shareholders.
Q: . During February, $195,500 was paid to creditors on account, and purchases on account were $207,600...
A: Answer a) Calculation of Balance of Accounts Payable on February 1 Balance of accounts payable on Fe...
Q: Solvay Corporation's bonds have a 10-year maturity, a 12% semiannual coupon, and a par value of $1,0...
A: Solution: Bond price is computed as present value of future interest and maturity value discounted a...
Q: Which of the following choices best describes reasonable conclusions that you might make about the t...
A: Answer) Calculation of Current Ratio of Company A and Company B Company A Company B ...
Q: On July 01, 2021, Parent, Inc. acquired most of the outstanding common stock of Subsidiary Company f...
A: Goodwill is an intangible asset for a company. It can either be build overtime or can be purchased f...
Q: Novi purchased ABC bonds on 1/1/22. Data regarding these available-for-sale securities follow: ...
A: Fair value adjustment account shows the balance of unrealized gain (credit ) or unrealized loss on r...
Q: pital balances on January 1, 2022 of P115,000, P150,000 and P200,000, respectively. They share profi...
A: partnership in such form of business where two or more person come in order to join the business and...
Bulldogs Inc. enters into an agreement with a firm that will factor the company’s accounts receivable. The factor agrees to buy the company’s receivables, which average P100,000 per month and have an average collection period of 30 days. The factor will advance up to 80% of the face value of receivables at an annual rate of 10% and a charge fee of 2% on all receivables purchased. The controller of the company estimates that the company would save P18,000 in collection expenses over the year. Fees and interest are not deducted in advance. Assuming a 360-day year, what is the annual cost of financing?
Step by step
Solved in 3 steps
- On December 1 of the current year, Jordan Inc. assigns 125,000 of its accounts receivable to McLaughlin Company for cash. McLaughlin Company charges a 750 service fee, advances 85% of Jordans accounts receivable, and charges an annual interest rate of 9% on any outstanding loan balance. Prepare the related journal entries for Jordan.White Corporation has entered into an agreement to transfer accounts receivable to Murphy Company. Under the terms of this agreement, White receives 80% of the value of all the transferred accounts receivable (to reflect credit risk) and is charged a 1% service charge, which is based upon the dollar amount of transferred receivables. Interest is charged at an annual interest rate of 12% of any outstanding loan balance. The transferred receivables will continue to be collected by White with any cash flows being remitted to Murphy at the end of each month. White is not allowed to transfer the receivables to anyone else. White normally transfers its accounts receivable. The following selected 2019 transactions relate to this agreement: Dec 1 Accounts receivable of $160,000 are transferred. 11 A sales return of $1,000 on a transferred account is made. 31 Collections are made on $82,000 of the transferred accounts receivable plus interest for the month of December. This amount is…Lowe and Price Co has annual credit sales of $12,000,000, and three months are allowed for payment. The company decides to offer a 2% discount for payments made within ten days of the invoice being sent, and to reduce the maximum time allowed for payment to two months. It is estimated that 50% of customers will take the discount. The company requires a 20% return on investments. Assume that the volume of sales will be unaffected by the discount. What is the reduction in accounts receivable? What is the opportunity income from the reduction in accounts receivable? What is the discount allowed each year? What is the net benefit of new discount policy each year?
- Summit Record Company is negotiating with two banks for a $134, 000 loan. Fidelity Bank requires a compensating balance of 18 percent, discounts the loan, and wants to be paid back in four quarterly payments. Southwest Bank requires a compensating balance of 9 percent, does not discount the loan, but wants to be paid back in 12 monthly installments. The stated rate for both banks is 12 percent. Compensating balances will be subtracted from the $134,000 in determining the available funds in part a. a-1. Calculate the effective interest rate for Fidelity Bank and Southwest Bank. Note: Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places. a-2. Which loan should Summit accept? multiple choice 1 Southwest Bank Correct Fidelity Bank b. Recompute the effective cost of interest, assuming that Summit ordinarily maintains $ 24, 120 at each bank in deposits that will serve as compensating balances. Note: Do not round intermediate calculations. Input…Kumi Ltd permits its customers to pay with a credit card or to receive a percentage discount ? for paying cash. For credit card purchases, the company receives 97% of the purchase price one-half month later. Determine the value of ? that would make the two payment methods equivalent if the company’s annual rate of return is 14%.New-Markups Department Store has annual credit sales of $ 300 million. John Harris, the collection manager, has estimated that it takes 10 days for a mailed payment to be credited to Newman’s account and that this time can be cut to 5 days if Newman opens up a lockbox account with a local bank. The account in which the checks are placed earns 8.4% annually. The lockbox agreement calls for a monthly payment of $1,350 and, in addition, a monthly charge of $0.06 per check. Newman’s currently processes 120,000 checks monthly. (Treat these expenses as if they occur at the beginning of the year.) a) What are Newman’s daily sales (assuming a 360-day year) b) By how much will Newman’s average bank balance increase if it adopts the lockbox? c) Should Mr Harris adopt the lockbox ? d) Suppose Newman’s has found a regular 20% of its customers account for 80% of credit sales. Should Mr Harris open up the lockbox and use it only for this 20% of the customers?
- Summit Record Company is negotiating with two banks for a $151,000 loan. Fidelity Bank requires a 28 percent compensating balance, discounts the loan, and wants to be paid back in four quarterly payments. Southwest Bank requires a 14 percent compensating balance, does not discount the loan, but wants to be paid back in 12 monthly installments. The stated rate for both banks is 10 percent. Compensating balances will be subtracted from the $151,000 in determining the available funds in part a. Calculate the effective interest rate for Fidelity Bank and Southwest Bank. Which loan should Summit accept? Recompute the effective cost of interest, assuming that Summit ordinarily maintains $42,280 at each bank in deposits that will serve as compensating balances. Does your choice of banks change if the assumption in part b is correct?Springer Products wishes to borrow $90,000 from a local bank using its accounts receivable to secure the loan. The bank's policy is to accept as collateral any accounts that are normally paid within 30 days of the end of the credit period, as long as the average age of the account is not greater than the customer's average payment period. Springer's accounts receivable, their average ages, and the average payment period for each customer are shown in the following table: Customer Accounts Receivable Average age of account Average payment period of customer A $11,000 42 days 50 days B $25,000 70 days 65 days C $10,000 48 days 45 days D $28,000 55 days 50 days E $14,000 50 days 60 days F $19,000 21 days 35 days G $30,000 10 days 30 days H $16,000 25 days 40 days…The XYZ customer service branch maintains a disbursement account which is funded by the main office. The branch needs funds for daily disbursements of P40,000 and a minimum balance of P20,000. The cost to transfer funds from the main office to the branch averages P300. The return on money marketable securities is 5%. XYZ Corporation agreed with its major supplier a credit term of 3/30, n/75. Using 360 days in a year, what would the compound annualize cost of this payable?
