A real estate developer can afford no more than $500 per month in principal and interest payments. The most favorable loans available in the market are 1) a 10-year partially amortizing loan with an anual rate of 8% with 20,000 balloon payment and 2) a 10-year interest only loan with an annual rate of 9%. What is the maximum affordable purchase price with a 20% down payment?

Q: Define risk-adjusted cost of capital (r)

A: Risk adjusted cost of capital is the measure of returns of a project relative to the risks of a…

Q: 21. On January 01, 2019, SUNOD NA ANG LEASES LTD. issued 3- year bonds with face value of P5,000,000…

A: Given: Face value = P5,000,000 Price = 99% Nominal rate = 10% Issue cost = P150,000

Q: Relationship of monetary policy to inflation

A: Inflation: Inflation is defined as a situation in which the general price level of the economy rises…

Q: fferent ty

A: Define interest. In finance, or economics interest can be defined as the payment of a proportion…

Q: investment securities for $5, 15,400 on a two-year, 8 per= 7, sold machinery for its ca machinery…

A: 1 Statement  of cash flows      For the year ended Dec 31 2017   Cash flow from operating…

Q: Create simple examples to illustrate the following concepts. i. Time value of money ii. Effective…

A: i) Time Value of Money: The concept of time value of money underlines that the value of money today…

Q: What do you mean by Assets, Liabilities, Capital, Revenues and Expenses?

A: Accounting is primarily concerned with identifying, recording, measuring, summarizing transactions…

Q: Perpare financails based on GAAP

A: Financial statements are always prepared by the company but which are followed and prepared as per…

Q: 7 What are utilities, property taxes, and insurance all examples of? A O Contract contingencies. BO…

A: We first needs to understand all the terms given in the question to answer the question. Contract…

Q: Define mezzanine loan?

A: Mezzanine funding: Mezzanine funding is a type of funding that has together the characteristics of…

Q: hich of the following cannot be qualified as a commodity certificate? A) Certificate of will B)…

A: Commodity certificate:   It is a payment method used by a commodity credit corporation in lieu of…

Q: Write down any 4 quantitative disclosure related to lessee.

A: Lessee is a person in the Lease arrangement, who holds lease property or who rents property from the…

Q: Define the following terms 1. Deferred Shares 2. Revenue Expenditures

A: Shares:Shares are the units that is used to represent the ownership of the company. Share capital of…

Q: None

A: BOP (Balance of Payment) - The balance of payments (BOP) is the method countries use to monitor all…

Q: What is realized real interest rates? Give example.

A: realized real interest rate  = nominal interest rate - actual inflation rate realized real interest…

Q: Match the type of bank income (revenue) with the associated source. Revenue received from wealth…

A: Interest Income: It is the main source of Income for banks and financial institution, interest…

Q: Discuss the following terms…

A: Financial market: It is the market under which bond, debentures, equities of the company are traded…

Q: Loan interest income ▸ D7/84 • The sequence in determining the taxability of interest income of an…

A: The objective of the question is to understand the sequence in determining the taxability of…

Q: Spot market Futures market Over the counter market Forwards markets

A: Commodity market are very important for determining the prices of commodities.

Q: Chapter 10, Question 16: What are contingent liabilities? List three examples of contingent…

A: Contingent liabilities are the liabilities which will arise on the happening or not unhappening of…

Q: 5. Related to insurance, what is a deductible and how does it

A: In insurance scheme there is always mentioned deductible amount.

Q: Define Capital Market Line (CML)

A: Introduction: Risk refers to the degree of volatility involved in the anticipated return on…

Q: 3. Explain the current liability “Accrued and other current liabilities.”

A: Liabilities: The claims creditors have over assets or resources of a company are referred to as…

Q: clearly distinguish between norminal interest rate and effective interest rate

A: The term interest rate can be defined as the fixed income received on the investment. . There are…

Q: Are the following statements true or false, according to IAS1 Presentation of Financial Statements?…

A: Lets discuss IAS 1 here. As per IAS 1 deals with the presentation of the financial statement. It…

Q: What is the relation between the present value of an investment and time and interest rate?

A: The concept of present value of an investment and time and interest rate is an important concept of…

Q: What is a mathematical term that is on display when using the fractional reserve?

A: Fractional reserve banking is defined as the system, where the fraction of the bank deposits that…

Q: 8. How should internal rate of return be calculated in terms of Net Present Value?

A: For a given project, there is a cost incurred at the beginning. It is called the Initial cost of the…

Q: 1. How are interest rates determined? Discuss and explain the interest rate equation and its…

A: Interest rate can be defined as the price that lenders charge for lending their money to borrowers.…

Q: A deposit received is reported as a * A.liability B.current asset C.investment D.revenue

A: Deposit received means amount of money received from vendors or suppliers as deposit.

Q: Which one of the following expenses is exempt from the payment of GST?

A: In gst interest service is exempt so not gst needs to be paid on payment of interest.Also in gst…

Q: Question 3. Classify each of the following accounts as (a) asset, (b) liability, or (c) equity.…

A: Assets means resources that the business have. It may be tangible resources or intangible resources.…

Q: How is the PW analysis dependent on the rate of interest used for the PW computation?

A: Net present value (or) PW analysis is one of the capital budgeting techniques. When a company is…

Q: how would you define monetary policy and its objective?

A: Monetary policy is the macroeconomic policy set by the central bank of a country. The prime focus of…

Q: Match the words with the term. 2 3 4 5 current liability 1. taxes payable 2. share capital 3.…

A: Taxes payable is current liability. Share capital is stockholders' equity. Inventories are current…

Q: To have a times interest earned of 8. Determine whether  A. Financial B. Nonfinancial

A: Interest is earned.

Q: Define Interest revenue.

A: Revenue: Revenue is earnings from the operations of a business. The operating activities are the…

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.