Answer:
a. will you receive a margin call?
No you wouldn't. You borrowed $20,000 on the margin which means that you invested $20,000 of your own money. You purchased 1,000 stocks (= $40,000 / $40) of ixnay at $40, and now the stock price is $35. This means that you lost $5,000, and you percentage on the margin = $15,000 / $35,000 = 43%. Since the maintenance margin is 35%, you are still in.
b. how low can the price of ixnay shares fall before you receive a margin call?
we can use the following formula = (1,000price - $20,000)/1,000price = 35%
350price = 1,000price - $20,000
$20,000 = 1,000price - 350price = 650price
price = $20,000/650 = $30.769 ≈ $30.77 or lower
You will not receive a margin call when the shares drop to $35 as the equity would still be above the required maintenance margin level of 35%. However, if the shares drop to approximately $57.14 per share, you will receive a margin call as the equity falls to the maintenance margin level.
In this scenario, you've invested in shares of Ixnay using margin lending. Since the initial margin requirement is 50%, you loaned $20,000 and put up an equal amount as collateral. This allowed you to buy 1,000 shares (i.e., $40,000 or $40 per share for 1,000 shares).
A. The margin call occurs when the equity in the account falls below the maintenance margin, which in this case, is set at 35%. The equity, in terms of market value, is equal to (number of shares * market price per share) - borrowed amount. Two days later, if the price of each share falls to $35, your equity would be: (1,000 * $35) - $20,000 = $15,000. The maintenance margin would be your equity divided by the market value of the shares, i.e., $15,000/$35,000 = 0.428 or around 42.8%. As this is greater than the maintenance margin of 35%, you will not receive a margin call.
B. The price at which you'll receive a margin call is when your equity equals the maintenance margin. To calculate this, use the following formula: (maintenance margin * Market Value) + Loan Amount. Substituting known values, we have: (0.35 * Market Value) = ~$20,000. Solving for Market Value, we get ~$57,142.86. Therefore, divide this by the number of shares you have, i.e., 1000 shares, to find that the price of the stock must fall to approximately $57.14 per share before you receive a margin call.
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The journal entry is accurately recorded to capture the sale of goods to Rajesh, the cash received through the cheque payment, and the remaining accounts receivable balance.
When goods are sold to Rajesh for Rs 8000, the sales revenue increases. On the debit side, Rajesh's account is debited with Rs 8000 as he owes the business. On the credit side, the Sales account is credited to record the revenue generated from the sale.
Since Rajesh paid Rs 5000 immediately by cheque, the Bank account is debited with Rs 5000 as the business receives cash. Simultaneously, the Accounts Receivable account is credited with Rs 3000, representing the remaining amount that Rajesh still owes.
This journal entry correctly represents the sale, the cash received, and the remaining accounts receivable balance resulting from the transaction with Rajesh. This showcases the proper accounting of the transaction within the business's financial records.
Complete Question:Pass journal entry Goods sold to Rajesh for rs 8000. He paid ruppees 5000 by cheque immediately? Explain.
To know more about Journal Entry, refer to;
When you take out an insurance policy your monthly premium is the amount you pay each month to keep your insurance. In this case, the $200 a month premium allows you to file a claim if something were to happen because you are paying for the insurance services. When you set up your premiums they will base your monthly service rates off of your deductible amount if you need to file a claim. The out-of-pocket for a car accident with a deductible of $700 is $700. Once the deductible is paid, the insurance will pay out for the damage.
The maximum amount of out-of-pocket expenses is $700.
Further Explanation:
Deductible in health insurance:
The deductible is the amount that the insured person has to pay for the health care services before the insurance company starts to pay. An insurance company pays for the health care bills after a specific limit. The insured person has to pay the health expenses up to a specific limit. This limit is known as the deductible.
Out-of-pocket expenses:
It is the maximum amount of expenses that the insured person has to pay for medical expenses. It includes the deductible, coinsurance, and co-payment. Premium paid on the insurance policy is not considered in the out-of-pocket expenses.
Out-of-pocket expenses in case of a car accident:
In the given case, the deductible is $700. The out-of-pocket expense includes the deductible, coinsurance, and co-payment. There is no provision of coinsurance and co-payment in the given case. Therefore, $700 will be considered as out-of-pocket expenses.
Thus, the maximum amount of out-of-pocket expenses is $700.
Learn more:
1. Learn more about health care insurance
2. Learn more about the insurance rules
3. Learn more about the insurance cover
Answer details:
Grade: Senior School
Subject: Business Studies
Chapter: Insurance
Keywords: Your, auto, insurance, policy, has, a $200, monthly, premium, and, $700, deductible, What, is, the, maximum, amount, you, will, have, to, pay, out-of-pocket, for, a, car, accident, before, your, insurance, covers, your, costs.
A.to explain how money is spent when applying for a loan
B.to provide information to the government for tax purposes
C.to determine whether or not a budget is working
D.to learn weaknesses with money and improve spending habits NextReset
Answer:
D.to learn weaknesses with money and improve spending habits
Explanation:
What a person does with their own finances affects their entire personal life. If the person has no financial control, he or she can go through difficult situations. Usually, people with a well-controlled financial life have a relatively quieter life. Although each person has a different level of spending according to their own needs, it is possible to identify one's inadequate and adequate habitation patterns as a way of learning. Analyzing someone's financial habits can help you identify overspending on superflowing items, so you don't make the same mistakes. On the other hand, this also serves as learning financial discipline for you if the person under review has a good grip on their finances.
b) are often preferred by technology-based companies.
c) are more attractive compared to acquisitions when entry barriers are high.
d) are less risky than acquisitions.
e) are best when the company is entering the industry on a small scale.
New ventures b) are often preferred by technology based companies.
Explanation:
The company's crisis management team led Wendy's response when a diner claimed to have found a fingertip in Wendy's chili.
Crisis management is the process of preparing for, responding to, and recovering from an unexpected or disruptive event that threatens an individual, organization, or community. This can include natural disasters, accidents, financial crises, reputational issues, or other events that can have a significant impact on the safety, operations, or reputation of an entity.
Effective crisis management involves a coordinated and strategic approach that includes identifying potential risks, developing response plans, and implementing mitigation measures to minimize the impact of the crisis. This can involve communication and collaboration among multiple stakeholders, including employees, customers, partners, regulators, and the media.
Learn more about crisis management here: brainly.com/question/17213979
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Answer:
Management by working around
Explanation:
It is Management by Walking Around. MBWA, it actually means that managers spend some part of their time listening to problems and ideas of their staff, while wandering around an office or plant.
Management by Walking Around is a term that was coined by Tom Peters. From his study of successful companies and their practices, Tom Peters observed that good managers tend to communicate a lot better with their team. Doing that in informal ways, like just hanging around in the office and chatting with them, rather than having formal interaction sessions in their boardrooms. The founder of, Walmart, was a great exponent of this practice. He believed in visiting as many of his stores as many times as possible and talking to frontline staff. The founder of House ofTara, a make up outfit goes round her stores and even works there just as to see the business through the eyes of the frontline staff
The idea of this practice is to listen. You must also respond to ideas or problems voiced and take effective action about them.