Answer:
Blume's formula combines the geometric and arithmetic means of an asset to be able to predict its returns in a given period.
The formula is;
= Geometric Mean*(T-1)/(N-1) + Arithmatic Mean *(N-T)/(N-1)
Where;
T = Period in question
N = Total period
10 years
= 8.3%*(10-1)/(90-1) + 10.3%*(90-10)/(90-1)
= 10.1 %
25 years
= 8.3%*(25-1)/(90-1) + 10.3%*(90-25)/(90-1)
= 9.76%
30 years
= 8.3%*(30-1)/(90-1) + 10.3%*(90-30)/(90-1)
= 9.65%
B) $112,000.
C) $90,000.
D) $107,200.
Answer:
C) $90,000
Explanation:
Beginning PBO = Interest cost/Discount rate =
Beginning PBO = $7,200/8%
Beginning PBO = $90,000
b)At the top of T account
c)In the debit side
d)In the credit side
Answer:
b)At the top of T account
Explanation:
The account name is always written at the top of a T account. The account name is also the account title.
A T account has a standard format. The title or the name is what differentiates them.
Answer:
3.54 dollars
Explanation:
2.50 = 250 cents
2.70 = 270 cents
2e + 3t = 250
e = (250 - 3t) / 2
3((250 -3t) / 2) + 2t = 270
(750 - 9t) / 2 + 2t = 270
750 - 9t + 4t = 540
750 - 5t = 540
210 = 5t
t = 42
e = (250 - 3t) / 2
e= (250 - 126) / 2
e = 124 / 2
e = 62
3e + 4t = 3(62) + 4(42) = 354 cents or 3.54 dollars
Explanation:
Following things will not work:
Answer:
False
Explanation:
This is a True/False question and the answer is false because of the reason highlighted below.
When there's a decrement in the values of the market price of a 100 shares, there's a high probability that one will receive a margin call. The essence of the margin call is none other than asking to make up for the loss in the decreased value of the 100 shares because legally, the brokerage firm have the right to sell one's shares in other to cover your losses.
And also because, buying on margin can never be an "interest free.", this is the reason why the broker will demand the payment of interest on the loan.
The question discusses margin trading in the stock market, where the investor borrows money from a broker to buy more shares. In this example, the investor buys 100 IBM shares at $120 each, contributing half the total cost and borrowing the rest. If the share price rises, the investor can sell, repay the loan, and make a profit.
The topic here is related to stock market investing and more specifically, margin trading. When you buy on margin, you are essentially borrowing money from your broker to purchase more stocks than you could with just your available cash. In your example, you bought 100 shares of IBM for $120/share, which totals $12,000.
Since the margin on your account is 50%, this means that you only need to provide half of this amount, or $6,000, and the broker will loan you the remaining $6,000. The goal is that the price of IBM shares sufficiently rises, at which point you may choose to sell your shares, repay the broker's $6,000 loan, and then keep any remaining profit as your capital gain.
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Question:
Early in 2020, Cullumber Equipment Company sold 500 Rollomatics at $6,300 each. During 2020, Cullumber spent $20,000 servicing the 2-year assurance warranties that accompany the Rollomatic. All applicable transactions are on a cash basis.
a. Prepare 2020 entries for Cullumber.
Assume that Cullumber estimates the total cost of servicing the warranties in the second year will be $34,000.
b. Prepare 2017 entries for Coronado assuming that the warranties are not an integral part of the sale (a service-type warranty).
Assume that of the sales total, $51,000 relates to sales of warranty contracts.
Coronado estimates the total cost of servicing the warranties will be $50,000 for 2 years.
Estimate revenues to be recognized on a straight-line basis.
Answer:
a.
Cash -------------------------------------_-_---------$3,150,000
Sales (to record sales of rollomatics) ----------------------------- $3,150,000
Warranty Expenses ------------------------ $20,000
Cash (Warranty Cost Incurred)------ -_-------------------_-----------. $20,000
Warranty Expenses -----_----- $14,000
Estimated Liabilities under Warranty (to accrue estimated warranty cost) -------- $14,000
b.
Cash ---- -----------_------------------------------- $3,150,000
Sales --------------------_------------------------------------------$3,099,000
Unearned Warranty Revenue ----------------------------- $51,000
(To record the sale of Rollomatics
Warranty Expenses ------------------------ $20,000
Cash (Warranty Cost Incurred)------ -_-------------------_-----------. $20,000
Unearned Warranty Revenue ------------------------ $25,000
Warranty Revenue (To recognise revenue earned)------ -_-------------------_-----------. $25,000