On April 1, Alex Deposited $2,000 in an MMDA That

question 2

Multiple Choice

On April 1, Alex deposited $2,000 in an MMDA that pays 3% interest. On July 1, Alex invested $3,000 in a six-month CD that pays 6% interest. How much total interest will Alex have earned by December 31?

• A) $90.00
• B) $45.00
• C) $135.00
• D) $240.00

Comprehend the concept and computation of the net advantage to leasing (NAL).

Recognize the tax implications and benefits associated with different types of leases.

Analyze the reasons why companies choose to lease assets rather than purchase them.

Understand the accounting treatment and reporting requirements for operating and capital leases.

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Definitions:

Opportunity Cost

The cost of missing out on the next best alternative when making a decision.

Special Order

An order for a product or service that is outside the company's standard offerings, often requiring customization.

Capacity

The maximum level of output that a company can sustain to produce in a given period under normal circumstances.

Sunk Costs

Sunk costs are past expenses that have already been incurred and cannot be recovered, and thus should not affect future business decisions.