Bill darby started darby company on january 1, 2018. the company experienced the following events during its first year of operation:

1.earned $16,200 of cash revenue.

2.borrowed $12,000 cash from the bank.

3.adjusted the accounting records to recognize accrued interest expense on the bank note. the note, issued on september 1, 2018, had a one-year term and an 8 percent annual interest rate.

required

a. what is the amount of interest expense to record for 2018?

b. what amount of cash was paid for interest in 2018?

c. use a horizontal statements model to show how each event affects the balance sheet, income statement, and statement of cash flows. indicate whether the event increases (i), decreases (d), or does not affect (na) each element of the financial statements. in the cash flows column, designate the cash flows as operating activities (oa), investing activities (ia), or financing activities (fa). the first transaction has been recorded as an example.

Suppose that jim plans to borrow money for an education at texas a& m university. jim will need to borrow $25,000 at the end of each year for the next five years (total=$125,000). jim wishes his parents could pay for his education but they can’t. at least, he qualifies for government loans with a reduced interest rate while he is in school. he has a special arrangement with aggiebank to lend him the money at a subsidized rate of 1% over five years without having to make a payment until the end of the fifth year. however, at the end of the fifth year, jim agrees to pay off the loan by borrowing from longhorn bank. longhorn bank will lend him the money he needs at an annual interest rate of 6%. jim agrees to pay back the longhorn bank with 20 annual payments and the payments will be uniform (equal annual payments including principal and interest). (i) calculate how much money jim has to borrow at the end of 5 years to pay off the loan with aggiebank. a. $121,336 b. $127,525 c. $125,000 d. $102,020 e. none of the above

An insurance company estimates the probability of an earthquake in the next year to be 0.0015. the average damage done to a house by an earthquake it estimates to be $90,000. if the company offers earthquake insurance for $150, what is company`s expected value of the policy? hint: think, is it profitable for the insurance company or not? will they gain (positive expected value) or lose (negative expected value)? if the expected value is negative, remember to show "-" sign. no "+" sign needed for the positive expected value

Mai and chuck have been divorced since 2012. they have three boys, ages 6, 8, and 10. all of the boys live with mai and she receives child support from chuck. mai and chuck both work and the boys need child care before and after school. te boys attend the fun house day care center and mai paid them $2,000 and chuck paid them $3,000. mai's agi is $18,000 and chuck's is $29,000. mai will claim two of the boys as dependents. she signed form 8332 which allows chuck to claim one of the boys. who can take the child and dependent care credit?