Finance Answers

Why are assets always equal to capital and liabilities?

Explain the similarities and differences between the dividends of a company and the drawing of a sole trader?

what is the difference between bad debts and the allowance for doubtful debts?

The rent market price for a 1-bedroom condominium in NYC is $3,000. However, the government does not allow these prices to be charged and establishes a price ceiling. This means that the government sets the maximum rent that can be charged. The rent market prices are usually far above the rents set by the government.

Question: What impact does this price ceiling have on the quantity demanded and supplied in this scenario?

On 1st July 1998 MBS Company issued 1 000 ten year bond with a face value of $10 000 each. The coupon rate was 10% and the risk adjusted required rate of return at the time of sale was 9%. Interest payments are to be paid each first of July. An original investor who bought ten bonds now needs money and is going to sell the bond on 2nd July 2002. At the time of resale, other 2001 new issue bonds will be offering a 7% coupon rate and the risk adjusted required rate of return is expected to be 8%.

What is the resale value of MBS Company bonds to the original investor?

how can a company attempts to reduce its problem of bad debts?

Offshore Petroleum's fixed costs are $2,500,000 and its debt repayment requirements are $1,000,000. Selling price per barrel of oil is $18 and variable costs per barrel are $10.

(a) Determine the breakeven output (in dollars).
(b) Determine the number of barrels of oil that offshore must produce and sell in order to earn a target (operating) profit of $1,500,000.
(c) Determine the degree of operating leverage at an output of 400,000 barrels.
(d) Assuming that sales of oil are normally distributed with a mean of 362,500 barrels and a standard deviation of 100,000 barrels, determine the probability that Offshore will incur an operating loss.