Spartan Corporation manufactures quidgets at its plant in Sparta, Michigan. Spartan sells its quidgets to customers in the United States, Canada, England, and Australia.
Spartan markets its products in Canada and England through branches in Toronto and London, respectively. Spartan reported total gross income on U.S. sales of $15,000,000 and total gross income on Canadian and U.K. sales of $5,000,000, split equally between the two countries. Spartan paid Canadian income taxes of $600,000 on its branch profits in Canada and U.K. income taxes of $700,000 on its branch profits in the United Kingdom. Spartan financed its Canadian operations through a $10 million capital contribution, which Spartan financed through a loan from Bank of America. During the current year, Spartan paid $600,000 in interest on the loan.
Spartan sells its quidgets to Australian customers through its wholly-owned Australian subsidiary. Spartan reported gross income of $3,000,000 on sales to its subsidiary during the year. The subsidiary paid Spartan a dividend of $670,000 on December 31 (the withholding tax is 0 percent under the U.S.–Australia treaty). Spartan paid Australian income taxes of $330,000 on the income repatriated as a dividend.
Requirement:
Compute Spartan’s foreign source gross income and foreign tax (direct and withholding) for the current year.
Assume 20 percent of the interest paid to Bank of America is allocated to the numerator of Spartan’s FTC limitation calculation. Compute Spartan Corporation’s FTC limitation using your calculation from part (a) and any excess FTC or excess FTC limitation (all of the foreign source income is put in the foreign branch FTC basket).
(Enter your answers in dollars not in millions of dollars.)
Answers
With the given data, Spartan's foreign source gross income, foreign tax, and FTC limitation can be calculated in the following ways:
To compute Spartan's foreign source gross income and foreign tax, we'll first find the gross income from each country and the total foreign tax paid.
1. Gross income from Canada: $2,500,000 (half of $5,000,000)
2. Gross income from the UK: $2,500,000 (half of $5,000,000)
3. Gross income from Australia: $3,000,000 (from sales to the subsidiary)
Total foreign source gross income: $2,500,000 (Canada) + $2,500,000 (UK) + $3,000,000 (Australia) = $8,000,000
Now, let's find the total foreign tax paid:
1. Direct tax paid in Canada: $600,000
2. Direct tax paid in the UK: $700,000
3. Direct tax paid in Australia: $330,000 (on income repatriated as a dividend)
Total foreign tax (direct and withholding): $600,000 (Canada) + $700,000 (UK) + $330,000 (Australia) = $1,630,000
Next, we'll calculate Spartan Corporation's FTC limitation. First, we need to determine the amount of interest allocated to the numerator of the FTC limitation calculation:
Interest allocated to numerator: 20% of $600,000 (interest paid to Bank of America) = $120,000
Now, we can compute the FTC limitation:
FTC limitation = (Total foreign source gross income / (Total foreign source gross income + U.S. gross income)) * U.S. tax liability
Assuming U.S. tax liability is unknown, the FTC limitation calculation would be:
FTC limitation = ($8,000,000 / ($8,000,000 + $15,000,000)) * U.S. tax liability
To calculate the excess FTC or excess FTC limitation, you would need to know the actual U.S. tax liability. However, based on the information provided, we have computed Spartan Corporation's foreign source gross income as $8,000,000 and total foreign tax (direct and withholding) as $1,630,000.
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Related Questions
according to the 2018/2019 global entrepreneurship monitor (gem), the percentage of entrepreneurs in the united states has reached
Answers
According to the 2018/2019 global entrepreneurship monitor (gem), the percentage of entrepreneurs in the United States has reached 15.6%.
More Than 31 million People withinside the United States (15.6% of the Adult Population Ages 18-64) Are Engaged in Early Stage Entrepreneurial Activity, According to the 2018/2019 United States GEM Report Produced through Babson College. With a exceedingly-professional workforce, competitiveness and openness for business, in addition to having clean get admission to to capital for entrepreneurs, the U.S. quotes exceedingly throughout the board.
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Which country tops the nba avid fan index based on august data from yougov’s global fan profiles?.
Answers
According to statistics from yougov's worldwide fan profiles collected in August, the Philippines country tops the list of NBA fans.
A professional basketball league in North America is called the National Basketball Association (NBA). One of the top professional sports leagues in the US and Canada, the league has 30 clubs, 29 of which are based in the US and one in Canada. It is the world's top men's professional basketball league.
Owners of the largest ice hockey rinks in the Northeast, the Midwest, and Canada created the Basketball Association of America in 1946. The Toronto Huskies played the New York Knickerbockers at Maple Leaf Gardens on November 1, 1946, in what the NBA currently considers to be the first game ever played in NBA history.
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write a query to list the names (last name and first name) and extension of employee’s who report to individuals who have the same job 3tle.
Answers
To list the names (last name and first name) and extension of employee's who report to individuals who have the same job 3tle, we need to write a SQL query using a SELECT statement and a JOIN statement. SQL Query:
SELECT e1.LastName, e1.FirstName, e1.Extension FROM employees AS e1JOIN employees AS e2 ON e1.ReportsTo = e2.EmployeeIdWHERE e2.JobTitle = '3tle';
The above SQL query will list the employee's last name, first name, and extension who report to individuals who have the same job 3tle. The query uses a self-join between the employees table to match the reportsTo column with the employee ID column.
The WHERE clause filters the result set by selecting only those rows where the employee has a job title of '3tle.' It helps in keeping track of employees and their roles. The query is simple and easy to understand, as it uses SQL functions to sort and filter data from the database.
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The role of information systems and technology in supply chain management no doubt plays a role in driving firms more toward a ________ approach and has made those supply chains that are dispersed all over the globe much easier to manage and control.
Answers
The role of information systems and technology in supply chain management is critical to the success of any organization. Information systems facilitate the exchange of data and communication between various stakeholders within the supply chain, enabling better coordination and control.
Technology, on the other hand, has revolutionized the way businesses operate, making it possible to automate many supply chain processes and make them more efficient. By leveraging technology, firms can track inventory levels, monitor delivery times, and optimize their logistics networks, all of which can lead to cost savings and improved customer service.
The use of information systems and technology in supply chain management has undoubtedly driven firms towards a more strategic approach, enabling them to manage complex global supply chains with greater ease and efficiency.
The role of information systems and technology in supply chain management no doubt plays a significant role in driving firms more towards a "centralized" approach. Information systems, such as Enterprise Resource Planning (ERP) and Warehouse Management Systems (WMS), help companies to effectively plan, manage, and control various supply chain activities. Technology, including data analytics, IoT, and automation, streamlines operations, improves visibility, and enhances communication. These innovations have made it possible for businesses to manage and control globally dispersed supply chains with greater efficiency and accuracy, ultimately leading to a more centralized and integrated approach.
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The price of orange juice falls from $2.49 a jug to $1.99 a jug. (1) Explain whether the demand curve for apple juice will shift left, shift right, or if there is only movement along the demand curve for apple juice.
Answers
Answer:
there is only movement along the demand curve for apple juice.
Explanation:
The demand curve shows the graphical relationship between the price of a good or service and the quantity demanded at each point in time. It shows the quantity demanded at each price. There is an inverse relationship between price and quantity demanded, as the price increases the quantity demanded reduces (but demand itself stays the same) while If the price decreases, quantity demanded increases.
The price of orange juice falls from $2.49 a jug to $1.99 a jug, the demand curve remains the same, but there is only movement along the demand curve for apple juice.
Why is insurance so important in today's society?
Answers
Life insurance is significant because it provides financial stability to the policyholder's family in the event of the policyholder's untimely death.
Anyone looking to protect their family, possessions, and themselves from financial risk or losses will benefit from insurance plans. Insurance plans will assist you in covering the costs of unexpected medical expenses, hospital stays, contracting illnesses and their associated treatments, and future medical care needs.
Life insurance can help the policyholder's family maintain their financial independence so they are not forced to make lifestyle compromises.
At its most basic level, insurance acts as a protective safety net that enables businesses to take on more risky and lucrative ventures than they otherwise might.
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You are advising Aramco in Saudi Arabia. The firm is in high-growth stage and is looking at the optimal way to finance it. Looking at petroleum companies in the U.S, it concludes that a significant proportion of capital should come from debt. Is this conclusion justified? Why and why not?
Answers
Answer:
No the conclusion is not justified
Explanation:
The decision is not justified and this because , Aramco stage in business ( High-growth stage ) will most likely be different from that of the petroleum firms in the US. This might be due to tax advantage of debt for firms in US which might be absent in Saudi Arabia. also the cost of finding Oil in the US might be higher when compared to the cost of finding Oil in Saudi Arabia
Hence the decision is not justified
Which of the following factors does not influence a firm's times-interest-earned ratio?
a. A firm's tax rate b. Amount of debt in the firm's capital structure c. A firm's profitability d. Interest rate on the firm's debt
Answers
None of the factors mentioned can be excluded from influencing a firm's times-interest-earned ratio.
The times-interest-earned (TIE) ratio is a measure of a company's ability to meet its debt obligations. It is calculated by dividing a company's earnings before interest and taxes (EBIT) by its interest expense.
Since the TIE ratio is calculated using both earnings and interest expenses, all the factors mentioned can influence the ratio.
A firm's tax rate affects its EBIT, while the amount of debt in the firm's capital structure and the interest rate on the firm's debt affect its interest expense. Finally, a firm's profitability is directly related to its EBIT, which, in turn, affects the TIE ratio.
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Which of the following is a common role of government in a” market economy? a. Provide public goods b. Own the factors of production C. Prevent competition d. Encourage central planning
Answers
Hope this helps!
Alltech Company maintains a separate accounts receivable account for each customer. On June 18, Alltech provides $6,300 of services on account to customer Anthony and $1,200 of services on account to customer Walker. How will these two transactions affect the control and subsidiary accounts?
Answers
Answer:
B. The control account, Accounts Receivable, will be increased with a debit of $8 300
Explanation:
According to the given situation, in total, the Alltech company makes sales of 2, one for $6,300, and the other for $2,000. The total of sales will be computed by adding both sales that are $6,300 + $2,000 = $8300 will therefore be booked and control and receivables will be boosted with a debit of $8,300.
Therefore, the correct answer is B.
how can a firm obtain the expertise needed to produce and market its products in, for example, the eu?
Answers
There are several ways that a firm can obtain the expertise needed to produce and market its products in the EU. These include:
Hiring expertsPartnering with other firmsPartnering with other firms Investing in training and developmentWe proceed to analyze the actions that companies can take to gain experience to produce and market in different organizations, for example, the EU:
Hiring experts: One of the most effective ways to obtain expertise is to hire professionals who already have the necessary skills and knowledge. This could include individuals with experience in product development, marketing, and regulatory compliance within the EU market.Partnering with other firms: Another approach is to partner with other firms that already have the expertise needed to produce and market products in the EU. This can help a firm tap into existing knowledge and resources, while also sharing the costs and risks associated with entering a new market.Investing in training and development: Firms can also invest in training and development programs to help their employees acquire the expertise needed to produce and market products in the EU. This could include sending employees to seminars and workshops, or providing them with access to online courses and resources.See more about firm at https://brainly.com/question/28339100.
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Monopolistic competition is a market condition with which major feature
Answers
Answer:
O C. Different businesses compete to sell similar products.
Explanation:
Here are the options :
A. Many businesses freely produce the same product.
O B. Only one business controls an entire industry.
O C. Different businesses compete to sell similar products.
O D. A few huge businesses control an industry.
A monopolistic competition is when there are many firms selling differentiated products in an industry. A monopolistic competition has characteristics of both a monopoly and a perfect competition. the demand curve is downward sloping. it sets the price for its goods and services.
Monopolistic competitive firms engage in advertising for their products
An example of monopolistic competition are restaurants
Answer:
A is correct
Explanation:
different businesses compete to sell similar products
during the job design phase, who decides specific job tasks?
Answers
During the job design phase, the specific job tasks are typically decided by a combination of individuals, including human resources professionals, managers, and subject matter experts.
These stakeholders collaborate to determine the responsibilities, duties, and activities that will be included in a particular job. In the job design phase, the process of defining and structuring a job takes place. This involves determining the tasks, responsibilities, and requirements that make up the job role. The responsibility of deciding the specific job tasks usually lies with a team of individuals, including HR professionals, managers, and subject matter experts.
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Select the correct answer.
Which management function is also a financial responsibility?
A. lanning
B. organizing
C. staffing
D. coordinating
E. controlling
Answers
Answer:
The answer is...
planning
During planning, you use financial responsibility. Financial responsibility refers to the process of managing money and other similar assets in a way that is considered productive and is also in the best interest of the individual, or the family, or the business company.
Mark me brainliest if this helps.
The planning is the management function, which is also a financial responsibility.
What is a management function?Management functions mean the five broad activities that managers perform to achieve organizational goals: planning, organizing, staffing, directing, and controlling.
The first and the most important function of management is planning. Planning involves setting objectives in advance, a goal which is to be achieved within a stipulated time. Various alternatives are formulated in order to achieve the goals.
Thus, Option A is true as planning is the management function, which is also a financial responsibility.
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Consider the following information. Suppose FC=$11,400. Further suppose that when q=9 then AVC=$1,500 and when q=10 then ATC=$2,500. If the firm decides to make 10 units (q=10), what is the MR at q=10?
Group of answer choices:
$100
$500
$700
Not enough information
Answers
Marginal Revenue can be calculated only when the price per unit is given, but here no such information is given and calculation cannot be made.
What is marginal revenue?The additional revenue earned by a firm when it determines to produce and sell one additional unit of the same product is known as the Marginal Revenue of the same.
Marginal Revenue cannot be calculated in the absence of price information of unit or the entire cost.
Thus, option D holds true regarding Marginal Revenue.
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this is due today hep is needed
Answers
Explanation:
In order to determine the nature and type of discount to offer in our direct mail campaign, I would conduct market research to assess the customer base and determine the most attractive coupon offer. This research could be both qualitative and quantitative in nature.
For the qualitative research, I would conduct focus groups and surveys to gauge customer sentiment on the types of discounts they would prefer and the types of discounts they would be most likely to respond to. This would help us to better understand the motivations and behaviors of our customers.
For the quantitative research, I would use analytical tools such as customer segmentation, data mining, and market basket analysis to identify potential consumer groups, determine the potential customer lifetime value, and understand the buying patterns of our customers. This would help us to better understand which types of discounts would be the most effective in driving sales.
I have been asked to be a part of research in the past. The research was mainly qualitative in nature, as researchers were looking to gain a better understanding of customer preferences and attitudes towards different products and services. They asked me to participate in a survey and focus group discussions to provide insights into my buying habits and opinion on the various products and services on offer.
Community colleges and vocational schools offer programs in maintenance and repair.
A
True
B.
False
Answers
Which of the following is the best definition of a minimum payment on a credit card?
a) A fee that must be paid whether the card is used or not
b) The smallest payment that will keep a credit card holder in good standing with the lender
C) The interest on the purchases that were made on the credit card
d) Alow introductory payment offered by the lender for a few months until the card holder has established good credit
Answers
match the type of real property with the macrs recovery period for that type of property. instructions nondepreciable nondepreciable drop zone empty. 39 yrs. 39 yrs. drop zone empty. 27.5 yrs. 27.5 yrs. drop zone empty. 31.5 yrs. 31.5 yrs. drop zone empty. residential rental property nonresidential property placed in service after may 13, 1993 land nonresidential property placed in service after dec. 31, 1986 and before
Answers
Real property is an asset or property which is attached with the land and will permanently remain as it is.
The correct answers will be:
Land - non depreciable
Residential rental property = 27.5 years
nonresidential property placed in service after May 13, 1993, -31.5 years
nonresidential property placed in service after Dec. 31, 1986, and before May 13, 1993 - 39 years.
A piece of ground and everything else that is affixed to it permanently are considered real property. Real estate owners are entitled to full ownership privileges, including that of the freedom to use, own, sell, and lease their property.
Real property can be categorized as domestic, industrial, farming, manufacturing, or special purpose depending on its general use. Knowing what rights, you do and do not in the property is essential in determining whether you possess the ability to sell your house.
The complete question is here:
Match the type of real property with the MACRS recovery period for that type of property.
Non depreciable – land
39 years – nonresidential property placed in service after May 13, 1993
27.5 years – residential rental property
31.5 years – nonresidential property placed in service after Dec. 31, 1986, and before May 13, 1993
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4 Not yet answered Marked out of 1.00 Flag question Spurious relationships:
A. Usually occur when there is a causal relationship amongst the dependent variable and two independent variables.
B. All of the above.
C. Demonstrate that correlation does not necessarily mean causality.
D. Lead to divorce.
E. Mean that one variable associations are best.
Answers
Spurious relationships refer to an association that happens between two variables, which is not real. These types of relationships are built on either coincidence or some third variable that is responsible for the relationship between the variables.
The correlation that exists between variables can indicate a spurious relationship between the two. Correlation does not necessarily imply that there is a cause and effect relationship that exists between the two variables. To confirm that there is a cause and effect relationship between two variables, it is essential to conduct an experiment to establish that a causal relationship does exist between the variables.One variable associations are usually preferred since they give an accurate representation of the relationship between two variables. These associations are more reliable and provide a better representation of the relationship that exists between the two variables. It is essential to consider the different factors that can affect the relationship between two variables before concluding that there is a relationship between them. These factors include correlation and confounding variables.Confounding variables are those that can influence the relationship between two variables, and they should be controlled to ensure that they do not affect the relationship between the variables. It is important to note that a cause and effect relationship can only be established through a well-designed and executed experiment. Therefore, correlation does not necessarily imply a cause and effect relationship.
Option A is correct
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suppose that consumer spending is expected to decrease in the near future. if output is at potential output, which of the following policies is most appropriate according to the as/ad model? multiple choice an increase in government spending an increase in taxes a reduction in government spending no change in taxes or government spending
Answers
An increase in government spending will offset the fall in consumer spending and keep the output level at the potential rather than dropping from that level due to reduced consumer spending.
Government. / (ˈɡʌvənmənt, ˈɡʌvəmənt)/ noun. To exercise political authority over a political entity, person, or other action, issue, etc., and to perform specific functions on behalf of that entity or body. act of governing. Political rules and administration. Government is the system of state or community government. The Colombian Encyclopedia defines government as "a system of social control in which the right to make laws and the right to enforce laws belong to specific groups in society."
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A proposed project X will give an expected yearly return of $200,000 at the end year for the next 10 years. What is the expected PV (Present Value) of project Xif we use
discount factor of 10%? If the project X need a start-up investment $1,300,000, as an investor, do you plan to invest this project X? Why or Why not
2
A-
B
I
III
TII
2
S
1
20
étv
II
4
to
Answers
The expected PV of project X is about $1,227,397. Considering the startup investment required is $1,300,000, the PV is lower than the initial investment.
The expected Present Value (PV) of project X can be calculated using the formula:
PV = CF / (1 + r)^n
Where CF is the cash flow, r is the discount factor, and n is the number of years.
For project X, the expected yearly return is $200,000, the discount factor is 10%, and it lasts for 10 years. To find the PV for the entire 10-year period, we can use the formula for the present value of an annuity:
PV = CF * [(1 - (1 + r)^(-n)) / r]
PV = 200,000 * [(1 - (1 + 0.1)^(-10)) / 0.1]
PV ≈ $1,227,397
As an investor, I would not recommend investing in project X because the expected PV is less than the required startup investment, indicating that the project may not yield enough returns to justify the investment.
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(this is not a question but Im just saying this because it may be important)
Im part of this group and I ask question when I need help with my homework but today I ask some questions and the question that I ask were all wrong ya'll are not smart ya'll are wrong I got a 40% on my homework ya'll are lying with the answers some of ya'll put ''I took the quiz" and I always read that and I said oh that's the correct answer and that's not true if you want to help other people do it correctly and Im really mad at this ya'll better change.
Answers
Answer:
instead of asking just search it up this is what i do
Explanation:
Answer:
You are just asking the wrong people
Imagine the labor force of the United States numbers 157 million persons. There are 8 million jobless persons actively looking for work. There are 6 million involuntary part-time workers. There are 600,000 jobless persons not looking for work because they believe no jobs are available to them.Given these conditions, what is the official unemployment rate in the United States
Answers
Answer: = 5.10%
Explanation:
The unemployment rate includes only those who do not have a job but are actively searching for one. People working part time are considered employed when calculating the unemployment rate.
In this case, only the 8 million jobless people looking for jobs will be classified as unemployed.
Unemployment rate = Number of unemployed / Number of people in labor force * 100%
= 8,000,000 / 157,000,000 * 100%
= 5.10%
Communication can most usefully be understood as a(n) Multiple Choice
a) innate human ability.
b) art form for which a chosen few possess raw talent.
c) skill acquired gradually through practice.
d) blunt tool that will always fail to accomplish its goal.
Answers
Communication can most usefully be understood as an innate human ability. Thus the correct option is A.
What is communication?Communication is referred to the exchange of information between two individuals in the form of conversation, opinion, suggestion, or advice with the help of medium or direct interaction.
By allowing us to connect with others and share our problems and perceptions, communication aids in the development of interpersonal relationships. It enables us to convey our emotions.
The likelihood of conflict is reduced when messages are conveyed clearly since there is no possibility for misinterpretation or message modification and helps in better achievement of objectives, especially in team building activities.
Therefore, option A is appropriate.
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employees often fear that any change in their work environment may reduce their ________.
Answers
Employees often fear that any change in their work environment may reduce their job security.
This fear can arise due to several factors such as potential job loss, alterations in job responsibilities, or decreased chances of promotion.
To alleviate these concerns, it is essential for employers to communicate openly with their employees about the reasons behind the changes and how they will benefit the organization.
By providing adequate training and support during the transition, employers can help ensure that employees adapt successfully to the new work environment. Ultimately, this proactive approach can boost employee confidence, minimize resistance to change, and foster a positive atmosphere in the workplace.
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On 1 July 2021 Chelsey Ltd issues through private placement $10 million in 5 year debentures that pay coupon interest on semi-annual basis at a coupon rate of 10 percent per annum. At the time of issuing the securities, the market requires a rate of return of 14 percent per annum. Interest expense is determined using the effective interest method. Required a. Determine the issue price (show all workings). (2 Mark) b. Provide the journal entries (show all workings) at: i. 1 July 2021. (1 mark) ii. 30 June 2022. (1 mark) iii. 30 June 2023. (1 mark)
Answers
a. The issue price of the debentures can be determined using the present value formula. The present value is the discounted value of the future cash flows (coupon payments and principal repayment) at the required rate of return. In this case, the coupon payments are semi-annual, so we need to adjust the time period accordingly.
The coupon payment per period is calculated as: Coupon rate * Face value / Number of coupon payments per year
Coupon payment = 10% * $10,000,000 / 2 = $500,000
The number of coupon payments over the 5-year period is: Number of years * Number of coupon payments per year
Number of coupon payments = 5 * 2 = 10
The required rate of return is 14% per annum, which is the discount rate.
Using these values, we can calculate the issue price as follows:
Issue price = Present value of coupon payments + Present value of principal repayment
Present value of coupon payments = Coupon payment * (1 - (1 + r)^-n) / r
Present value of coupon payments = $500,000 * (1 - (1 + 0.14/2)^-10) / (0.14/2) = $3,517,838.43
Present value of principal repayment = Face value / (1 + r)^n
Present value of principal repayment = $10,000,000 / (1 + 0.14/2)^10 = $4,172,254.04
Issue price = $3,517,838.43 + $4,172,254.04 = $7,690,092.47
Therefore, the issue price of the debentures is $7,690,092.47.
b. Journal entries:
i. 1 July 2021:
Cash Dr. $7,690,092.47 (Issue price)
Debentures Cr. $7,690,092.47 (Issuing debentures)
ii. 30 June 2022:
Interest Expense Dr. $500,000 (Coupon payment)
Interest Payable Cr. $500,000 (Accrued interest)
iii. 30 June 2023:
Interest Expense Dr. $500,000 (Coupon payment)
Interest Payable Cr. $500,000 (Accrued interest)
On the interest payment dates, the company records interest expense for the coupon payment and increases the interest payable account for the accrued interest. This represents the recognition of the interest expense and the liability to pay the interest to the debenture holders in the future.
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What is a mutual fund
Answers
Answer: A mutal fund is a professionally managed investment fund that pools money from many investors to purchase securities. the term is typically used in the United States, Canada, and India while simular structures across the globe include the SICAV in Europe and open-ended investment company in the UK.
Explanation:
what is the double entry system?
Answers
Answer: Double-entry bookkeeping, in accounting, is a system of book keeping where every entry to an account requires a corresponding and opposite entry to a different account. The double-entry system has two equal and corresponding sides known as debit and credit. Double entry, a fundamental concept underlying present-day bookkeeping and accounting, states that every financial transaction has equal and opposite effects in at least two different accounts. It is used to satisfy the accounting equation,
the inverse relationship between quantity demanded and price for a good can be explained by the law of diminishing marginal utility.group startstrue true or false
Answers
True. The law of diminishing marginal utility explains the inverse relationship between quantity demanded and price for a good.
This law states that as a consumer purchases more of a good, their satisfaction with it decreases. As the consumer purchases more of the good, they become less willing to pay for it, which leads to a decrease in quantity demanded as the price increases.
This can be seen in the downward slope of the demand curve. For example, if the price of an item increases, the consumer will purchase less of it due to the decrease in satisfaction they gain from it. This decrease in quantity demanded is what drives the inverse relationship between quantity demanded and price for a good.
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