Friday, April 26, 2019

Financial Accounting questions Assignment Example | Topics and Well Written Essays - 500 words

Financial Accounting questions - concession ExampleWith thanksgiving, new avenues open up for the fraternity and its able to tap into fresh opportunities. Clients of a company argon usually more automatic to forgive it when it makes a mistake if it has built a good relationship with them. If a company ever needs to liaise with others or expand or sell, with goodwill its much easier to get partners and buyers for the business due to the trust placed in it. grace places the company ahead of competition as customers are more likely to favour the company with goodwill when making a decision on which products and services to consume (Weil, Schip & Francis, 2014).As please rates rise, prices of bonds take up and when bear on rates drop, bond prices rise. This is due to the concept of opportunity cost. Investors compare the returns they are getting on their present investments to other investments in the market. A bond coupon rate is fixed therefore investors are ready to pay extra or less for a bond depending on how attractive the reside rates. Suppose a company offers a new issue of bonds carrying a 7%coupon which is $70 a year in concern. If you purchase a $1000, then later, interest rates go up to 8%, it means the interest will be $80 and buyers will be less willing to pay the face value of $1000 for the bond and you would have to offer it at a discount. However, if interest rates fell, it would be more attractive to prospective buyers as it would be carrying a higher interest rate than whatever is already in the market.Leasing might be preferred by a company because it eases up the cash flow of the company that can be directed to other operating activities. It likewise takes a shorter time compared to purchasing which involves a long and tedious procurement process. With leasing, the costs are open over a long time and can thus be matched to the companys income. The interest rates are agreed upon beforehand hence

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