User Account

All Pages

Adria lopez has consulted with her local banker

Assignment Help Accounting Basics
Reference no: EM13900858

Adria Lopez has consulted with her local banker and is considering financing an expansion of her business by obtaining a long term bank loan. Selected account balances at March 31, 2014, for Success Systems follow.
Total assets . . . . . . . . $ 129,909
Total liabilities . . . . . $ 875
Total equity . . . . . . . $ 129,034

Required: 

1. The bank has offered a long term secured note to Success Systems. The bank's loan procedures require that a client's debt to equity ratio not exceed 0.8. As of March 31, 2014, what is the maximum amount that Success Systems could borrow from this bank (rounded to nearest dollar)? 
2. If Success Systems borrows the maximum amount allowed from the bank, what percentage of assets would be financed 
(a) By debt (b) By equity? 
3. What are some factors Adria Lopez should consider before borrowing thefunds?

Reference no: EM13900858

Questions Cloud

Compute the net present value and profitability index : Compute the net present value, profitability index, and internal rate of return for each option. Which option should be accepted?
Which the matters could be brought : You are an attorney working for a large law firm. Anthony, Paul and Silvio retain you to represent them. With the material given prepare an essay explaining the issues presented. Be sure to explain the courts to which the matters could be brought and..
Which the matters could be brought : You are an attorney working for a large law firm. Anthony, Paul and Silvio retain you to represent them. With the material given prepare an essay explaining the issues presented. Be sure to explain the courts to which the matters could be brought and..
Examine the types of taxes imposed at the federal : Examine the types of taxes imposed at the federal
Adria lopez has consulted with her local banker : Adria Lopez has consulted with her local banker and is considering financing an expansion of her business by obtaining a long term bank loan. Selected account balances at March 31, 2014, for Success Systems follow.
What are the advantages of corporate form of business : What are some of the advantages of the corporate form of business and what are some explanations for the rise of large corporations in this country?
What is the probability of a type 1 error for this procedure : Toss the coin four times. If the coin lands either all heads or all tails, reject Ho: p=1/2 (the p denotes the chance for the coin to land on heads.) Complete parts a and b. what is the probability of a type 1 error for this procedure
The new york yankees are moving to boston next month : The new york yankees are moving to Boston next month and there are many shops outside where the Yankees are supposed to play. Smith wanted to rent a shop that is right across where they play to sell Merchandise. Jones offered Smith a price of $5000 p..
Prepare an unadjusted trial balance for palisade creek co : Prepare an unadjusted trial balance. Journalize the adjusting entries. Record the adjusting entries of the journal. Prepare the closing entries. Record the closing entries on Page 23 of the journal.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Basics of periodic inventory system

What are some reasons why a merchandiser might prefer to use a perpetual inventory system over a periodic inventory system?

  Total direct labor variance

The per-unit standards for direct labor are 2 direct labor hours at $12 per hour. If in producing 2,400 units, the actual direct labor cost was $51,200 for 4,000 direct labor hours worked, the total direct labor variance is

  At what amount will accounts receivable be reported on the

at what amount will accounts receivable be reported on the balance sheet if the gross receivable balance is 23500 and

  Show an unearned revenue account for the gift cards

Peterson views the probability of redemption of a gift card as remote if the card has not been redeemed within two months. At 12/31/2013, Peterson would show an unearned revenue account for the gift cards with a balance of:

  Abc company accepted a national credit card for a 2500

abc company accepted a national credit card for a 2500 purchase. the cost of the goods sold is 2000. the credit card

  Walts whistles manufactures referee whistles at the end of

walts whistles manufactures referee whistles. at the end of february walts has 2000 pounds of steel for whistles in

  A debt instrument with no ready market is exchanged for

a debt instrument with no ready market is exchanged for property whose fair market value is currently indeterminable.

  Investments in current assets section

Fulton will report investments in its current assets section of :

  Total cash dividends related problem

Norton's outstanding stock consists of (a) 13,000 shares of noncumulative 8% preferred stock with a $10 par value and (b) 32,500 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and pai..

  Research ethics and professionalism in accounting

Research ethics and professionalism in accounting and auditing and current emerging issues. Ex. Of magazines that will have articles related to ethics and professionalism are (1) CPA- Accounting Journal, (2) CFE - Fraud Magazine, (3) IIA - IA Aud..

  The net income reported on the income statement for the

the net income reported on the income statement for the current year was 210000. depreciation recorded on equipment and

  Medical supply company uses a cash receipts journal

Medical Supply company uses a cash receipts journal,a cash payments journal, a sales journal,a purchases journal, and a general journal. Which journal should be used to record each of the following transactions?  payment of property taxes  purchas..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd