Hugo Insurance Company is facing difficulties in its liability insurance line of business - it has incurred losses and loss adjustment expenses of $975,000 and earned premiums of $1,300,000 in the current year. As the expected loss ratio was 65%, what is the minimum level of rate adjustment that Hugo Insurance Company must introduce for its liability insurance business in the coming year? O a. 15.6% O b. 15.0% Oc. 15.4% O d. 15.2%

Hugo Insurance Company is facing difficulties in its liability insurance line of business - it has incurred losses and loss adjustment expenses of $975,000 and earned premiums of $1,300,000 in the current year. As the expected loss ratio was 65%, what is the minimum level of rate adjustment that Hugo Insurance Company must introduce for its liability insurance business in the coming year? O a. 15.6% O b. 15.0% Oc. 15.4% O d. 15.2%

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

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Percent of sales method; write-off At year-end (December 31), Rashed Company estimates its bad debts as 0.75% of its annual credit sales of AED790,000. Rashed records its bad debts expense for that estimate. On the following February 15, Rashed decides that the AED1,250 account of A. Abdulla is uncollectible and writes it off as a bad debt. On March 31st, Abdulla unexpectedly pays the amount previously written off. Required: Prepare the journal entries of Rashed to record these transactions and events of December 31, February 15, and March 31st.
SCENARIO #2 12/31/2019: At the end of the first year of operations, Yolandi Company had $900,000 in sales and accounts receivable of $350,000. Yolandi's management has estimated that $9,000 in accounts receivable would be uncollectible (use the aging method). For the end of 2019, after the adjusting entry for bad debts was journalized, what is the balance in the following accounts: Bad debt expense Allowance for doubtful accounts For the end of 2019, what is the company's net realizable value? 12/31/2020: During 2020, S10,000 in accounts receivable were written off. At the end of the second year of operations, Yolandi Company had $1,000,000 in sales and accounts receivable of $400,000. Yolandi's management has estimated that S17,000 in accounts receivable would be uncollectible (use the aging method). Bad debt expense Allowance for doubtful accounts For the end of 2020, what is the company's net realizable value?
Fink Insurance collected premiums of $18,300,000 from its customers during the current year. The adjusted balance in the Deferred premiums revenue account increased from $5.0 million to $9.3 million dollars during the year. What is Fink's revenue from insurance premium recognized for the current year? Multiple Choice $9,000,000. $22,600.000. $14,000,000
The choices are 240K, 248K, 256K and 260K
Current Attempt in Progress The following items are the adjusting entries that Wildhorse Cabinet Corp. plans to make before completing its work sheet and financial statements: a. b. C. d. e. f. Equipment is amortized at the rate of 10% per year based on an original cost of $61,300. Estimated bad debts are 0.20% of sales ($439,000). Prepaid insurance of $354 expired during the year. Interest of $720 is accrued on notes receivable as at December 31. The Rent Expense account contains $480 of rent paid in advance, which is applicable to next year. Property taxes of $1,800 are to be accrued to December 31. The Fair Value through Other Comprehensive Income (FV-OCI) Investments account is based on the original cost of $11,200 of an equity investment acquired on July 1. On December 31, the fair value of the investment is $14,000. To simplify matters for this example, assume that unrealized changes in fair value for FV-OCI investments are non-taxable.
View Policies Current Attempt in Progress Vaughn Manufacturing has outstanding accounts receivable totaling $ 6.47 million as of December 31 and sales on credit during the year of $ 24.5 million. There is also a credit balance of $ 11500 in the allowance for doubtful accounts. If the company estimates that 6% of its outstanding receivables will be uncollectible, what will be the amount of bad debt expense recognized for the year? O $388200. O $ 399700. O $ 376700. O $1470000. Save for Later Attempts: 0 of 1 used Submit Answer
What is the liability for the outstanding premiums at year-end?* a. 2,000,000 b. 562,500 c. 2,250,000 d. 500,000
Commercial Supply Corp. bills its accounts on terms of 2/10 net 30. The firm's accounts receivable include $200 000 that has been outstanding for ten or fewer days, $126 000 outstanding for 11 to 30 days, $198 000 outstanding for 31 to 40 days, $92 000 outstanding for 41 to 50 days, $30 000 outstanding for 51 to 60 days, and $7 000 outstanding for more than 60 days. Is the ageing schedule for Commercial Supply Corp. bottom heavy? Select one: O a. No, since 70% of the outstanding sales are on time and the percentage of long-term outstanding payments is low. O b. No, since the percentage of payments that are late are greater than the percentage of payments that are on time. O c. Yes, since the percentage of payments that are late are greater than the percentage of payments that are on time. O d. Cannot tell from the information given.
QUESTION 1 The schedule of aging accounts for a Company, at the end of the year 2020, appears below: Accounts Receivable $40,000 10,000 5,500 1,800 57,300 Estimate % of Bad Debts Current 1% 1-30 days overdue 31-60 days overdue More than 60 days overdue 5% 10% 20% Total The allowance was estimated by using the schedule of ageing accounts. The allowance account had a debit balance of $600, before the estimate was made. Required: Prepare the adjusting entry to record bad debts expense for 2020.

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