What is the net effect of the loan on welcome profit

Assignment Help Accounting Basics
Reference no: EM133042183

Question - On Jan. 1, 20x1, Welcome Bank extended a 4 year, P500,000, zero interest loan to a client. The borrower received loan proceeds of P500,000 and that amount is due in lump sum at maturity. The prevailing interest rate for this type of loan is 12%. What is the net effect of the loan on Welcome's profit in 20x1?

a. (182,240)

b. (144,109)

c. 38,131

d. 0

Reference no: EM133042183

Questions Cloud

Record the issue of the bill in the general journal : On 2 March 2021 LHZ Ltd issued a 5% bill payable to Slone Ltd in settlement of an account of $25,000. Record the issue of the bill in the general journal
Generational differences in workplace attitudes : 1) Construct side by side bar charts using the data from this survey.
Explain how these can affect the behaviour of the staff : Define HRM recruitment and selection models, theories, and concepts (AMO Theory, Human Capital Theory, Michigan Framework, 5 P Model etc
Competency model for walmart inc : 1. What knowledge, skills, ability, and personal characteristics are included in the competency model? Are they relevant to a particular job, job family, and or
What is the net effect of the loan on welcome profit : The prevailing interest rate for this type of loan is 12%. What is the net effect of the loan on Welcome's profit in 20x1
Compare and contrast the leadership grid : Question 1: Compare and contrast the leadership grid in North House book. Where do each of the types of management compare with chapter III in "Being the Boss"?
What is the distribution for x : Assume the probability each stoplight is red when she gets to it is 0.2 and that these stoplights (trials) are independent. What is the distribution for X
Evaluate the outcomes in terms of relevance : Considering making a training evaluation for Walmart Inc. 1. What types of outcomes would you use in training evaluation?
Will this bond be sold at a discount or a premium : Russel's Rockets issues a $700,000 bond on 1/1/20Y1 with a stated rate of 8%. Interest is paid annually. Will this bond be sold at a discount or a premium

Reviews

Write a Review

Accounting Basics Questions & Answers

  What amount should the rods be reported

What amount should the 950 rods be reported in the balance sheet as inventory as at 30 June 2020? Explain your answer, including any necessary calculations

  Determine the amount of the annual depreciation

Revision of depreciation - A truck with a cost of $94,000 has an estimated residual value of $20,500, Determine the amount of the annual depreciation

  What is the external auditor role in the accounting process

What is the external auditor's role in the accounting process? Why is it important to analyze the historical performance of a company

  Journal entries to record the pension expense

Prepare journal entries to record the pension expense and funding of plan assets to verify the change in the pension asset/liability.

  Briefly discuss what comprehensive corporate reporting is

Briefly discuss what comprehensive corporate reporting is? Discuss the potential benefits of the new international Sustainability standards board over IFRSs

  Which of the following is advantage of corporations

which of the following is an advantage of corporations relative to partnerships and sole proprietorships?reduced legal

  How much does sarah have to include in her gross income

Sarah Crowly uses the cash receipts method of accounting for her accounting business. How much does Sarah have to include in her gross income for 2011

  Discuss company and its subsidiaries have long-term leases

The company and its subsidiaries have long-term leases expiring on various dates after December 31, 2017

  Compute the cash received from customers

C Company's current year income statement reports the following: Compute the cash received from customers and the cash paid for inventory purchases

  What are his estimated profit for the next six months

Gilbert Monzon wants to "kick it up a notch" and open a new restaurant. What are his estimated profit for the next six months

  What is the amount of cash paid for the purchase

Assuming that the accounts payable account is used only for amounts owing to supposed in relation to inventory purchases, what is the amount of cash paid

  Compensating-balance requirement

If Lincoln Bank eliminated its compensating-balance requirement, would your answer change?

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!

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