Meaning of Interim Dividend
Interim Dividend is that which is paid before the final dividend is declared. it is a dividend paid in between the two final dividends. It…
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Companies enter into swaps for reasons of return and/or risk
Either they wish to lower the cost of their financing or better match their financing to the cash flows from their operations, thereby providing some…
Importance of An Accurate Valuation of Inventories
The auditor examines the particular thing to assume himself of its existence. Physical examination requires identification of the item. One must be convinced that he…
How does a collar make a floating rate loan become more like a fixed rate loan?
A collar limits the amount of interest rate movement that can affect a borrower. A collar with a wide band has very little effect, cutting…
Explain Prepayment
Prepayment also known as prepared expenses are those expenses which are incurred or paid during the year under audit but relate to the period subsequent…
Identify three conditions in which term loan financing is particularly appropriate
Three conditions in which a term loan is appropriate are: (1) to finance an asset of intermediate-term life, thus hedging the loan with the cash…
Divisible Profits
Profit may be defined as follows: 1. Generally speaking the profit of the business during a given period is the excess over the expenditure for…
Equal amortization term loan
What are the similarities and differences between: a. An equal payment term loan? An equal payment loan is a loan which is repaid in a…
Describe the rights and Duties of an Auditor in brief
Rights and duties go together. Whatever is demanded by someone as ‘Rights’ is considered justified on the basis of ‘Duties’ he performs. Similar is the…
Distinguish between a “balloon” and a “bullet.”
A balloon and bullet each involve a large final payment to repay a loan. The difference is the amount. A bullet is the full principal…