Journalize the entries for the following transactions:
Mar. 1 Established a petty cash fund of $771.
31 The amount of cash in the petty cash fund is now $632. The fund is replenished based on the following receipts: office supplies, $33 selling expenses, $113.
Record any discrepancy in the cash short and over account. If an amount box does not require an entry, leave it blank.

Answers

Answer 1

Answer:

Mar 1

Dr Petty Cash $771.00

Cr Cash $771.00

Mar 31

Dr Office Supplies $33.00

Dr Selling Expenses 113.00

Cr Cash Short and Over $27.00

Cr Cash $119.00

Explanation:

Preparation of the entry to Record any discrepancy in the cash short and over account.

Mar 1

Dr Petty Cash $771.00

Cr Cash $771.00

(To record petty cash)

Mar 31

Dr Office Supplies $33.00

Dr Selling Expenses 113.00

Cr Cash Short and Over $27.00

[($33+$133+$632)-$771]

Cr Cash $119.00

(33+$133-$27)

(To Record discrepancy in the cash short and over account)


Related Questions

Which of the following statements are true regarding technology, gaming, and gambling? #1. Rapid-play poker machines have increased the number of problem and pathological gamblers. #2. Online gambling has resulted in an increased number of problem and pathological gamblers. #3. There is no evidence that technology has led to an increase in the number of people with gambling or gaming addictions. #4. Electronic media is a breeding ground for new addictions, such as Internet, video games, texting, and multiplayer games.

Answers

Answer:

1. Rapid-play poker machines have increased the number of problem and pathological gamblers.

2. Online gambling has resulted in an increased number of problem and pathological gamblers.

4. Electronic media is a breeding ground for new addictions, such as Internet, video games, texting, and multiplayer games.

Explanation:

The true statements regarding technology, gaming, and gambling include:

1. Rapid-play poker machines have increased the number of problem and pathological gamblers.

2. Online gambling has resulted in an increased number of problem and pathological gamblers.

4. Electronic media is a breeding ground for new addictions, such as Internet, video games, texting, and multiplayer games.

It should be noted that there are several betting companies nowadays and this has led to more people to be involved in gambling.

Hill Company uses the periodic inventory system. It records a transaction that increases the balances in its purchases and accounts payable accounts. Which of the following is true about Hill Company?

a. When the related merchandise is sold, the purchases account will be decreased by the related cost of goods sold.
b. The manner in which this transaction was recorded indicates that Hill returned $6,000 of merchandise to a supplier.
c. The balance in the account will appear on the balance sheet at year end.
d. The manner in which this transaction was recorded indicates that Hill purchased inventory on account.

Answers

Answer:

Hill Company

The true statement about Hill Company is:

d. The manner in which this transaction was recorded indicates that Hill purchased inventory on account.

Explanation:

Purchases made on account (or credit terms) are debited to the Purchases account (periodic inventory system) and credited to the Accounts Payable account.  This increases the amount of purchases and the accounts payable account respectively by the same amount.  If Hill Company uses the perpetual inventory system, the debit goes to the Inventory account and the corresponding credit to the Accounts Payable account.

Flying Cloud Co. has the following operating data for its manufacturing operations:
Unit selling price $ 350
Unit variable cost $ 100
Total fixed costs $980,000
The company has decided to increase the wages of hourly workers which will increase the unit variable cost by 10%. Increases in the salaries of factory supervisors and property taxes for the factory will increase fixed costs by 5%. If sales prices are held constant, the next break-even point for Flying Cloud Co. will be:__________
a) increased by 368 units
b) decreased by 368 units
c) increased by 132 units
d) decreased by 264 units

Answers

Answer:

a) increased by 368 units

Explanation:

The calculation of the next break even point should be

Existing  break-even point for Flying Cloud Co. is

= Fixed Cost ÷ Contribution Margin Per Unit

= Fixed Cost ÷ Sales Price Per Unit - Variable Cost per Unit

= $980,000 ÷ ( $350 - $100)

= 3,920 Units

Now

Revised Variable cost = $100 × 110%

= $110

And,  

Revised Fixed cost = $980,000  × 105%

= $1,029,000

So,

Revised  break-even point for Flying Cloud Co. is

= Fixed Cost  ÷ ( Contribution Margin Per Unit

= Fixed Cost  ÷ ( Sales Price Per Unit - Variable Cost per Unit

= $1,029,000  ÷ ( ( $350 -$110)

= 4,287.5

= 4,288 units

So,  

Increase = 4,288 Units - 3920 Units

= 368 Units Increase

Based on a predicted level of production and sales of 30,000 units, a company anticipates total contribution margin of $105,000, fixed costs of $40,000, and operating income of $65,000. Based on this information, the budgeted operating income for 28,000 units would be

Answers

Answer: $58,000

Explanation:

Operating income for 28,000 units = Contribution margin for 28,000 units - Fixed costs

Contribution margin for 28,000 units:

= 28,000 units * Contribution margin of 30,000 units / 30,000 units

= 28,000 * 105,000 / 30,000

= $98,000 units

Operating income for 28,000 units = 98,000 - 40,000

= $58,000

A company's flexible budget for 12,000 units of production showed total contribution margin of $24,000 and fixed costs, $16,000. The operating income expected if the company produces and sells 15,000 units is:________
a) $34,000.
b) $10,000.
c) $18,667.
d) $8,000.
e) $14,000.

Answers

Answer:

e. $14,000

Explanation:

Operating income for 15,000 units = Proportionate contribution - Fixed cost

Operating income for 15,000 units = [($24,000/12,000)*15,000] - $16,000

Operating income for 15,000 units = $30,000 - $16,000

Operating income for 15,000 units = $14,000

So, the operating income expected if the company produces and sells 15,000 units is $14,000.

der owns a hamburger restaurant. Slider's minimum average variable cost is $10$ 10 at a quantity of 100 hamburgers, and his minimum average total cost is $15$ 15 at a quantity of 200 hamburgers. His total fixed cost is $300$ 300 . Use this information to answer the questions. What is Slider's AVC when he sells 200 hamburgers?

Answers

Answer:

$13.50

Explanation:

Average Total Cost = Average Variable Cost + Average Fixed Cost

Average Fixed Cost = total fixed cost / quantity

300 / 200 = 1.5

15 = 1.5 + Average Variable Cost

Average Variable Cost =15 - 1.5 = 13.50

A new trailer worth $10,000 is purchased and it's expected that the salvage value after 13 years will be $480. If the annual interest rate is 4.20% , what equation would be appropriate to use to determine the Expected Uniform Annual Cost (EUAC)

Answers

The equation that is used to determine the Expected Uniform Annual Cost is :

[tex]$A = P(A/P, i,n) - F(A/F, i,n)$[/tex]

It is given that :

Purchased price of a new trailer = $ 10,000

Number of years = 13 years

The salvage value after 13 years = $480

The rate of interest annually = 4.20%

The Estimated Uniform Annual Cost, that is the EUAC method is used to express the life cycle costs as the annualized estimate of the cash flow rather than a lumpsum estimate of the present value.

In other words, it is the annual cost of a system which is equal or equivalent to the discounted total cost.

So the equation that can be used to express the Expected Uniform Annual Cost in the given problem is :

[tex]$A = P(A/P, i,n) - F(A/F, i,n)$[/tex]

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You sold ten put contracts on Cross Town Bank stock at an option price per share of $0.85. The options have an exercise price of $39 per share. The options were exercised today when the stock price was $34 a share. What is your net profit or loss on this investment assuming that you closed out your positions at a stock price of $34

Answers

Answer:

-$4,150

Explanation:

Calculation to determine your net profit or loss on this investment

Using this formula

Net profit/Loss=(Option price per share-Exercise price+Stock price)×100×10

Let plug in the formula

Net loss = ($0.85 - $39 + $34) × 100 × 10

Net loss =-$4.15×100×19

Net loss = -$4,150

Therefore your net loss on this investment is -$4,150

Bluegill Company sells 14,000 units at $240 per unit. Fixed costs are $168,000, and operating income is $1,176,000. Determine the following:
a. Variable cost per unit.
b. Unit contribution margin.
c. Contribution margin ratio.

Answers

Answer:

a. Variable cost per unit:

= (Sales - Fixed costs - Operating income) / number of units sold

= ((14,000 units * 240) - 168,000 - 1,176,000) / 14,000

= 2,016,000 / 14,000

= $144 per unit

b. Unit contribution margin:

= Selling price - Variable cost per unit

= 240 - 144

= $96

c. Contribution margin ratio:

= Unit contribution margin / Selling price

= 96 / 240

= 40%

As more units of an item are purchased, everything else equal, marginal satisfaction from consuming additional units will tend to Select one: a. decrease at the same rate for all consumers. b. decrease but at different rates for different people. c. increase at the same rate for all consumers. d. increase but at a decreasing rate for all consumers.

Answers

Answer:

b

Explanation:

Marginal satisfaction is the additional satisfaction received from consuming an additional unit of a good or service. It is the change in total satisfaction by increasing the quantity consumed by one unit

Marginal satisfaction usually declines as more units of the products is consumed

An example illustrating diminishing marginal satisfaction.

Imagine a traveller arriving from the desert where he hadn't had a drink of water in days .he is offered his first glass of water. the first cup of water he drinks would give him the highest utility. As more and more cups of water is drank, marginal utility decreases. At the point where he is fully satisfied, he stops drinking water and marginal utility becomes zero.

the decrease in marginal satisfaction of this traveller would be slower than the decrease in marginal satisfaction of a person working in an air conditioned office with easy assess to water

difference between price consumption curve and income consumption curve​

Answers

Answer:

Price-consumption curve is a graph that shows how a consumer's consumption choices change when price of one of the goods changes. Income-consumption curve is a similar graph which traces changes in demand in response to changes in income.

A producer of fixed proportion goods X and Y (Q = Qx = Qy) has marginal costs and revenues of MC = 10 Q, MRX = 150 - 6 QX, MRy = 30 - 4 Qy. The producer should produce how many units?
a. Qx =9, Qy=9
b. Qx = 9, Qy = 7.5
c. Qx = 10, Qy = 10
d. Qx = 9, Qy=0

Answers

Answer:

a. Qx =9, Qy=9

Explanation:

As per the given data

Q = QX = QY

MRX = 150 - 6QX = 150 - 6Q

MRY = 30 - 4QY = 30 - 4Q

MC = 10Q

Now calculate the Marginal revenue as follow

MR = MRX + MRY

MR = 150 - 6Q + 30 - 4Q

MR = 150 + 30 - 6Q - 4Q

MR = 180 - 10Q

The Equilibrium of the producer will be

MR = MC

180 - 10Q = 10Q

180 = 10Q + 10Q

180 = 20Q

Q = 180 / 20

Q = 9

As we know

Q = Qx = QY

Hence, the value of Qx  and QY is 9

Question 4 of 10
Which situation best illustrates the process of capital formation?
O A. A farmer increases his profits by growing a variety of new crops.
B. An artist buys bonds that will increase in value over time.
C. An engineer tries to limit her spending during the week.
O D. A factory worker takes out a high-interest loan to buy a new home.
SUBMIT

Answers

Answer:

I think it is B

Explanation:

Answer:

an artist buys bondss that will increase in value over time.

Explanation:

took the test. UwU

If the price exceeds the average variable cost but is less than the average total cost, a firm Group of answer choices should further differentiate its product. is making some profit but less than maximum profit. should stay in business for a while longer until its fixed costs expire. should shut down

Answers

Answer:

should stay in business for a while longer until its fixed costs expire.

Explanation:

price exceeds the average variable cost, the firm should continue to operate in the short run

If price is less  than the average total cost in the long run, the firm should exit in the long run

Exercise 9-4 Interest-bearing notes payable with year-end adjustments LO P1 Keesha Co. borrows $145,000 cash on December 1 of the current year by signing a 90-day, 9%, $145,000 note. 1. On what date does this note mature? 2. & 3. What is the amount of interest expense in the current year and the following year from this note? 4. Prepare journal entries to record (a) issuance of the note, (b) accrual of interest on December 31, and (c) payment of the note at maturity.

Answers

Answer:

Keesha Co.

1. The date on which this note matures is February 28.

2. Interest expense for the current year is:

= $1,108

3. Interest expense for the following year is:

= $2,109

4. Journal Entries:

December 1:

Debit Cash $145,000

Credit Notes Payable $145,000

a) To record the issuance of the 90-day, 9% notes payable.

December 31:

Debit Interest Expense $1,108

Credit Interest Payable $1,108

b) To accrue interest expense.

February 28:

Debit Notes Payable $145,000

Debit Interest Payable $1,108

Debit Interest Expense $2,109

Credit Cash $148,217

To record the payment of the note at maturity.

Explanation:

a) Data and Calculations:

Notes Payable on December 1 = $145,000

Interest rate on the note = 9%

Duration of note = 90 days

December 1

Plus 90 days

= February 28

Interest expense for the current year = $1,108 ($145,000 * 9% * 31/365)

Interest expense for the following year = $2,109 ($145,000 * 9% * 59/365)

Analysis:

December 1:

Cash $145,000

Notes Payable $145,000

December 31:

Interest Expense $1,108

Interest Payable $1,108

February 28:

Notes Payable $145,000

Interest Payable $1,108

Interest Expense $2,109

Cash $148,217

What should Yelk set as the direct labor rate per hour?

Answers

Explanation:

30%

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Relevant Range and Fixed and Variable Costs
Vogel Inc. manufactures memory chips for electronic toys within a relevant range of 61,600 to 100,800 memory chips per year. Within this range, the following partially completed manufacturing cost schedule has been prepared:
Components produced 61,600 79,200 100,800
Total costs:
Total variable costs . . . . . . . . . $19,712 (d) (j)
Total fixed costs . . . . . . . . . . . . 22,176 (e) (k)
Total costs . . . . . . . . . . . . . . . . . $41,888 (f) (l)
Cost per unit:
Variable cost per unit . . . . . . . (a) (g) (m)
Fixed cost per unit . . . . . . . . . . (b) (h) (n)
Total cost per unit . . . . . . . . . . (c) (i) (o)
Complete the cost schedule below. When computing the cost per unit, round to two decimal places. Round all other values to the nearest dollar.
Cost Report
Components produced 61,600 79,200 100,800
Total costs:
Total variable costs $19,712 (d) $ (j) $
Total fixed costs 22,176 (e) (k)
Total costs $41,888 (f) $ (l) $
Cost per Unit
Variable cost per unit (a) $ (g) $ (m) $
Fixed cost per unit (b) (h) (n)
Total cost per unit (c) $ (i) $ (o) $

Answers

Answer:

Variable cost per unit is constant.

Total fixed cost is constant.

Explanation:

Which one of the following is NOT included in the Marketing Mix?
Select one:
a. Promotion
b. Product
c. Distribution
d. Price
e. Personalization

Answers

C : Distribution is not included in the marketing mix

C . Or E. Distribution or personalization

Sales variance analysis is used by managers for: Select one: a. Planning purposes only. b. Budgeting purposes only. c. Control purposes only. d. Planning and control purposes. e. Planning and budgeting purposes.

Answers

Answer:

e. Planning and budgeting purposes.

Explanation:

Sales variance analysis is used by managers for planning and budgeting purposes, as this analysis allows managers to better understand the company's sales scenario in a given period in relation to different variables such as budgeted quantity, quantity sold and amount of profit made.

Through analysis, greater control and strategic planning and future budgets are possible so that an organization remains profitable and competitive in the market.

Complete the following table:
Exhibit 15-1 Disposable income and consumption data Income (Y) Change in Disposable Income Consumption (C) 0 500 1,000 1,000 1,400 2,000 1,000 2,200 3,000 1,000 2,900 4,000 1,000 3,500 5,000 1,000 4,000 In Exhibit 15-1, when disposable income is increased from $2,000 to $3,000 to $4,000,

Answers

Answer: e. the marginal propensity to consume decreases from 0.7 to 0.6

Explanation:

Calculate the marginal propensity to consumer when the disposable income is increased from $2,000 to $3,000 to $4,000.

The Marginal propensity to consume is calculated by the formula:

= Change in consumption / Change in income

When disposable income increased from $2,000 to $3,000.

= (2,900 - 2,200) / (3,000 - 2,000)

= 0.7

When disposable income increased from $2,000 to $3,000.

= (3,500 - 2,900) / (4,000 - 3,000)

= 0.6

The marginal propensity to consume decreased from 0.7 to 0.6.

In Washburn's factory, what is the break-even point for the new line of guitars if the retail price is (a) $349, (b) $389, and (c) $309? Also, (d) if Washburn achieves the sales target of 2,000 units at the $349 retail price, what will its profit be?

Answers

Answer:

a. 186 units

b. 156 units

c. 232 units

d. $370,000

Explanation:

a. Calculation to determine the break-even point for the new line of guitars if the retail price is $349

Using this formula

Break-even point quantity = Fixed cost / Unit price – Unit variable cost

Let plug in the formula

Break-even point quantity = ($14,000 + $4,000 + $20,000) / $349 – ($25 + $120)

Break-even point quantity= $38,000 / $349 - $145

Break-even point quantity= $38,000 / $204

Break-even point quantity= 186.27

Break-even point quantity= 186 units

Therefore the break-even point for the new line of guitars if the retail price is $349 will be 186 units

b. Calculation to determine the break-even point for the new line of guitars if the retail price is $389

Break-even point quantity = ($14,000 + $4,000 + $20,000) / $389 – ($25 + $120)

Break-even point quantity= $38,000 / $389 - $145

Break-even point quantity= $38,000 / $244= 155.74

Break-even point quantity = 156 units (Approximately)

Therefore Therefore the break-even point for the new line of guitars if the retail price is $389 will be 156 units

c. Calculation to determine the break-even point for the new line of guitars if the retail price is $309

Break-even point quantity=($14,000+$4,000+$20,000)/$309 – ($25 + $120)

Break-even point quantity= $38,000 / $309 - $145

Break-even point quantity= $38,000 / $164

Break-even point quantity= 231.71

Break-even point quantity = 232 units (Approximately)

Therefore the break-even point for the new line of guitars if the retail price is $309 will be 232 units

d. Calculation to determine what will its profit be

if Washburn achieves the sales target of 2,000 units at the $349 retail price

Using this formula

Profit = Total revenue – Total cost

Profit= (P x Q) – [FC + (UVC x Q)]

Let plug in the formula

Profit= ($349 x 2000) – [$38,000 + ($145 x 2,000)]

Profit= $698,000 – $328,000

Profit= $370,000

Therefore the profit will be $370,000

All of the following are true about a cyclical pattern EXCEPT it is ______. a. often combined with long-term trend patterns and called trend-cycle patterns b. often due to multi-year business cycles c. usually easier to forecast than a seasonal pattern due to less variability d. an alternating sequence of data points above and below the trend line

Answers

The statement "it becomes easy to forecast as compared to the seasonal pattern because of the less variability" should be considered.

The information related to the cyclical pattern is as follows:

It should be repeated having regularity for many years. It is mix with the trend i.e. long-term patterns.It contains many year business cycles.It is an alternative for sequencing the data point that is above and below the trending line.

But it does not easier for forecasting as the seasonal pattern should be for one year only.

Therefore we can conclude that the statement "it becomes easy to forecast as compared to the seasonal pattern because of the less variability" should be considered.

Learn more about the trend line here: brainly.com/question/22722918

AJ Manufacturing Company incurred $54,500 of fixed product cost and $43,600 of variable product cost during its first year of operation. Also during its first year, AJ incurred $17,350 of fixed and $13,900 of variable selling and administrative costs. The company sold all of the units it produced for $178,000. Required Prepare an income statement using the format required by generally accepted accounting Principles (GAAP). Prepare an income statement using the contribution margin approach.

Answers

Answer and Explanation:

The preparation of the income statement under following approaches are

Under  generally accepted accounting Principles (GAAP)

Sales $178,000

Less: cost of goods sold ($54,500 + $43,600) -$98,100

Gross margin $79,900

Less: selling & general admin ($17,350 + $13,900) -$31,250

Net income $48,650

Under contribution margin approach

Sales $178,000

Less: variable cost ($43,600 + $13,900) -$57.5

Contribution margin $120,500

Less: fixed cost ($54,500 + $17,350) -$71,850

Net income $48,650

Suppose that in 2014, currency in circulation was $950 billion, required reserves were $60 billion, and excess reserves were $840 billion. At that time, the value of open market operations by the Federal Reserve was $70 billion. The monetary base was

Answers

Answer: $1,850 billion

Explanation:

The following were given in the question:

Currency in circulation = $950 billion

Required reserves = $60 billion

Excess reserves = $840 billion

Open market operations = $70 billion

The monetary base will be the value of all the currency in circulation plus the reserves that is held by the banks and this will be:

= $950billion + $60billion + $840billion

= $1,850 billion

Northberg Company is preparing a cash budget for August. The company has $16,000 cash at the beginning of August and anticipates $126,000 in cash receipts and $134,500 in cash payments during August. Northberg Company wants to maintain a minimum cash balance of $15,000. To maintain the $15,000 required balance, during August the company must: Group of answer choices Borrow $15,000. Repay $7,500. Repay $8,500. Borrow $7,500. Borrow $8,500.

Answers

Answer:

Borrow $7,500

Explanation:

The calculation of the amount that should be required to maintain the required balance is given below:

Preliminary cash balance

= Opening balance + Cash receipts - Cash disbursements

= $16,000 + $126,000 - $134,500

= $7,500

Since we have to maintain $15,000 so we have to borrow the following amount

= $15,000 - $7,500

= $7,500

In the small country of Economerica, there are 6 thousand people employed, 1 thousand people unemployed, and 3 thousand people of working age not included in the labor force. One thousand students graduate from the university and seek jobs in the country, but not one graduate is able to find one. Half of the new graduates believe there is no chance of finding a job and return home to live with their parents. Ceteris Paribus, what would the new unemployment rate be in Economerica?
A. 14.29%
B. 20.00%
C. 25.00%
D. 45.45%

Answers

Answer: B. 20.00%

Explanation:

Unemployment rate does not include those who have given up on finding a job.

Unemployment rate = Unemployed people / Labor force

Unemployed people:

= Original unemployed + half the new graduates

= 1,000 + (1,000 / 2)

= 1,500 people

Labor force:

= Unemployed + employed people

= 1,500 + 6,000

= 7,500 people

Unemployment rate:

= 1,500 / 7,500

= 20%

A horizontal merger between two firms occurs when: __________

a. the products of the merging firms were not related in any manner before the merger.
b. one firm is a producer of products, and the other firm is a producer of services.
c. one firm is a domestic firm, and the other is a foreign company
d. the firms stood in a buyer-seller relationship before the merger.
e. the merger partners were competitors.

Answers

Answer:

e

Explanation:

A merger can be described as the absorption of one firm by another firm.

When a merger occurs, one of the firms would not exist as a separate entity while the other firm would continue to exist.

Types of merger

1. Horizontal merger : this is a type of merger that occurs between firms in the same industry. The firms are usually competitors.

Reasons for an horizontal merger

It is done to increase the market power of a firmThis type of merger is done to achieve economies of scale.

An example of an horizontal merger is the merger between Mobil and Exxon in 1999.

2. Vertical merger : this is when a firm purchases another firm in the same production line. e.g. a baker purchases a pastry distributing company

Reasons for a vertical merger

Cost savingsIt provides the firm acquiring a greater control of the production process.

Types of vertical merger

a. Backward integration : it is when the acquiring firm purchases a firm ahead of it in the production process. e.g. a baker purchases a pastry distributing company

b. Forward integration : it is when the acquiring firm purchases a firm that is behind it in the production process. e.g. a baker purchases a firm that supplies grains

3. Conglomerate merger : This occurs when the products of the merging firms were not related in any manner before the merger.

A lender uses these tools to help prequalify you for a mortgage

Answers

Answer:

Following are the summary of tools/documents that are used by lenders to pre-qualify their customers for a mortgage :

1. Tax returns, W-2s, and 1099s are examples of income as well as employment records.

2. Bank, pension, and brokerage accounts property declarations

3. Settlements on your obligations on a regular basis as well as any real estate debt statements.

4. Rent deposits, divorce, insolvency, and repossession records are all kept on file.

Geraldo is a customer care executive at a telecommunications service provider. He receives a complaint from a customer about an unnecessary $20 charge on his phone bill. If the company follows the customer service management process, Geraldo is most likely to _____.

Answers

Answer:

Provide a quick response to the customer using customer care software.

Explanation:

Software Programs

This is simply regarded as a service tool or software distribution model where software applications are hosted by a vendor or service provider and made available to customers over a network that is often the internet.

There are some of the software that is available. They includes the following:

Inventory managementReceivingStore Replenishment POS etc.

Marketing Channel

This is used by individuals and firms involved in making a product or service available for use or consumption by consumers or industrial users.

Advantages of equity financing over debt financing include that: Multiple Choice equity financing does not require repayment. dividends are mandatory. stockholders' control will increase. dividends are tax deductible.

Answers

Answer: equity financing does not require repayment.

Explanation:

Equity financing simply means a method of financing which has to do with the sale of shares. Debt financing occurs when money is raised by a company through the sale of debt instruments to the investors.

It should be noted that equity financing is the opposite of debt financing. Unlike the debt financing, equity finance doesn't carry a repayment obligation. In this case, the investors purchase the shares in the company and they make money through the dividends gotten or through the eventual sale of shares.

Also, there is less risky with the equity financing as there's no fixed monthly loan payments to make and this can be of immense benefit to startup businesses.

Other Questions
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