E6-2 (Simple and Compound Interest Computations) Lyle O’Keefe invests $30,000 at 8% annual interest, leaving the money invested without withdrawing any of the interest for 8 years. At the end of the 8 years, Lyle withdrew the accumulated amount of money.
Instructions
(a) Compute the amount Lyle would withdraw assuming the investment earns simple interest.
(b) Compute the amount Lyle would withdraw assuming the investment earns interest compounded annually.
(c) Compute the amount Lyle would withdraw assuming the investment earns interest compounded semiannually.
Click here for the solution: Lyle O’Keefe invests $30,000 at 8% annual interest, leaving the money invested without withdrawing any of the interest for 8 years
Showing posts with label invested. Show all posts
Showing posts with label invested. Show all posts
Sunday, July 19, 2015
Wednesday, June 24, 2015
Upton Company was started on January 1, 2011, when the owners invested $160,000 cash in the business
Problem 8-18 Effect of business structure on financial statements
Upton Company was started on January 1, 2011, when the owners invested $ 160,000 cash in the business. During 2011, the company earned cash revenues of $ 120,000 and incurred cash expenses of $ 82,000. The company also paid cash distributions of $ 15,000.
Required
Prepare a 2011 income statement, capital statement ( statement of changes in equity), balance sheet, and statement of cash flows using each of the following assumptions. ( Consider each assumption separately.)
a. Upton is a sole proprietorship owned by J. Upton.
b. Upton is a partnership with two partners, Dan and Nancy Upton. Dan invested $ 100,000 and Nancy invested $ 60,000 of the $ 160,000 cash that was used to start the business. Nancy was expected to assume the vast majority of the responsibility for operating the business. The partnership agreement called for Nancy to receive 60 percent of the profits and Dan the remaining 40 percent. With regard to the $ 15,000 distribution, Nancy withdrew $ 6,000 from the business and Dan withdrew $ 9,000.
c. Upton is a corporation. The owners were issued 10,000 shares of $ 10 par common stock when they invested the $ 160,000 cash in the business.
Click here for the solution: Upton Company was started on January 1, 2011, when the owners invested $160,000 cash in the business
Upton Company was started on January 1, 2011, when the owners invested $ 160,000 cash in the business. During 2011, the company earned cash revenues of $ 120,000 and incurred cash expenses of $ 82,000. The company also paid cash distributions of $ 15,000.
Required
Prepare a 2011 income statement, capital statement ( statement of changes in equity), balance sheet, and statement of cash flows using each of the following assumptions. ( Consider each assumption separately.)
a. Upton is a sole proprietorship owned by J. Upton.
b. Upton is a partnership with two partners, Dan and Nancy Upton. Dan invested $ 100,000 and Nancy invested $ 60,000 of the $ 160,000 cash that was used to start the business. Nancy was expected to assume the vast majority of the responsibility for operating the business. The partnership agreement called for Nancy to receive 60 percent of the profits and Dan the remaining 40 percent. With regard to the $ 15,000 distribution, Nancy withdrew $ 6,000 from the business and Dan withdrew $ 9,000.
c. Upton is a corporation. The owners were issued 10,000 shares of $ 10 par common stock when they invested the $ 160,000 cash in the business.
Click here for the solution: Upton Company was started on January 1, 2011, when the owners invested $160,000 cash in the business
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