The journal entry to record each semiannual interest payment is:
Debit Bond Interest Expense $22,000; credit Cash $22,000.
<h3>
What journal entries?</h3>
- A journal entry is an act of keeping or producing records of any economic or non-economic transaction.
- An accounting journal, which shows a company's debit and credit balances, records transactions.
- The journal entry can be made up of multiple records, each of which is either a debit or a credit.
- Otherwise, the journal entry is termed unbalanced if the sum of the debits does not equal the total of the credits.
- For example, a corporation may issue 8%, 15-year bonds with a par value of $550,000 that pay semi-annual interest. The market rate is currently 8%.
- The journal entry for each semiannual interest payment is as follows: Debit Bond Interest Expense $22,000; credit Cash $22,000.
Therefore, the journal entry to record each semiannual interest payment is:
Debit Bond Interest Expense $22,000; credit Cash $22,000.
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Answer: Option a
Explanation: Payback period in capital budgeting comes from a time needed to recover or exceed the break-even point of the funds spent on a project. Moreover, the payback period does not take into account the time value of money.
It is based on the number of years it would take for the funds spent to be recovered. Thus, payback period only evaluates a project on the basis of time period it takes to recover back the investment this results in ignorance of cash flows, which might be huge in amount, that results after the pay back period.
Marginal revenue is equal to marginal cost.
A perfectly competitive firm will maximize profits (minimize losses) by producing the level of quantity.
The profit maximize firms will occur at a level of quantity where marginal revenue equals to the marginal cost. It can also maximize its profit when its total cost curve intersects curve. Economic profit is the difference between the total revenues and economic costs.
Perfectly competitive firms are called the price taker firm to maintain and maximize profits. It definitely raise the prize for its profit otherwise it losses all its production in terms of sales. It is generally an atomic market condition intensively depending on ideal price.
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Answer:
$200,000
Explanation:
Selling price per unit = $60.00
Contribution margin per unit = $45.00
Total fixed costs = $150,000
Tax rate = 30%
Contribution margin ratio = Contribution margin ÷ Selling price
= $45 ÷ $60
= 0.75
Hence,
Break-even point =Total Fixed costs ÷ Contribution margin ratio
= 150,000 ÷ 0.75
= $200,000
If AR is constant, MR is equal to AR. Both are indicated by the same horizontal straight line(a situation of perfect competition)
<h3>What is the marginal revenue curve for a perfectly competitive firm?</h3>
- Marginal revenue for a company with perfect competition is the same as average revenue and pricing.
- This suggests that at values bigger than the average variable cost, the firm's short-run supply curve is its marginal cost curve.
- The company closes if the price falls below the average variable cost.
Marginal revenue is the change in total revenue when one more unit of a commodity is sold.
MR= change in TR/change in quantity sold
Average revenue refers to revenue per unit of output.
AR=TR/Q
Relationship between AR and MR:
If AR is constant, MR is equal to AR.
Both are indicated by the same horizontal straight line(a situation of perfect competition)
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