Answer with its Explanation:
Step 1:
First of all record a loan of $3 million loan:
Dr Bank $3,000,000
Cr Loan $3,000,000
Step 2:
Finance charge will be 3% on this loan amount:
Dr Finance Charge $3million *3% = $90,000
Cr Bank $90,000
Step 3:
The interest on the note is 7% which is $70,000. So the journal entry would be:
Dr Interest Expense $70,000
Cr Interest payable $70,0000
Answer:
the free cash flow for the current year is zero.
Explanation:
Net income = $400; Net operating profit after taxes (NOPAT) = $500; Total assets = $2,000; and Total operating capital = $1700
Net income = $800; Net operating profit after taxes (NOPAT) = $700; Total assets = $2,300; and Total operating capital = $2,100.
current year:
operating profit after taxes 700
Capital expenditures: 2,000 - 2,300 = (300)
working capital expeneses 1,700 - 2,100 = (400)
free cash flow: 0
As assets increase the company use cash to increase his assets
Also, the operating capital increase the comapny pa debts, extend his collection cycle or any other desition which, increases his cahs needs.
Therefore the free cash flow for the year is zero.
Answer
<h3>
The total purchase price allocated to land, building, and machinery accounts is $140,840, $509,707 and $355,453 respectively.</h3>
<h3>
Explanation</h3>
<h3><em>Calculation of Total purchase price</em></h3>
- Total purchase price = purchase price + legal fee
= 1.000.000 + 6.000
= 1.006.000
Allocation of the total purchase price to the land, building, and machinery accounts in Tamarack Company’s record:
- Land = Total purchase price * (Assesed Value of Land / Total Property Assessed Value)
= 1.006.000 * (126.000 / 900.000)
= 140.840
- Building = Total Purchase Price * (Assesed Value of Machinery / Total Property Assessed Value)
Building = 1.006.000 * (318.000 / 900.000) = 355.453,3
<h3>
Thus, the total purchase price allocated to land, building, and machinery accounts is $140,840, $509,707 and $355,453 respectively.</h3>
Answer:
B. False
Explanation:
Land held for possible plant expansion would NOT be included as an operating asset when computing return on investment (ROI).
Return on investment (ROI) is used to measure the profitability of an investment. It helps to compare the gain or loss from an investment in relation to its cost.
Return on investment can be used to determine
1. Profitability of a stock investment,
2. Profitability of the purchase of a business investment
3. Profitability of a real estate business
ROI = Net return / cost of investment × 100
Net return= Final value of investment - initial value of the investment
