This question is incomplete, the complete question is;
Transfer Pricing: Various Computations
Corning Company has a decentralized organization with a divisional structure. Two of these divisions are the Appliance Division and the Manufactured Housing Division. Each divisional manager is evaluated on the basis of ROI.
The Appliance Division produces a small automatic dishwasher that the Manufactured Housing Division can use in one of its models. Appliance can produce up to 20,000 of these dishwashers per year. The variable costs of manufacturing the dishwashers are $98.The Manufactured Housing Division inserts the dishwasher into the model house and then sells the manufactured house to outside customers for $73,000 each. The division's capacity is 4,000 units. The variable costs of the manufactured house (in addition to the cost of the dishwasher itself) are $42,600.
Required:
Assume each part is independent, unless otherwise indicated.
1) Assume that all of the dishwashers produced can be sold to external customers for $320 each. The Manufactured Housing Division wants to buy 4,000 dishwashers per year. What should the transfer price be?
2) Refer to Requirement 1. Assume $24 of avoidable distribution costs. Identify the maximum and minimum transfer prices.
3) Assume that the Appliance Division is operating at 75 percent capacity. The Manufactured Housing Division is currently buying 4,000 dishwashers from an outside supplier for $290 each. Assume that any joint benefit will be split evenly between the two divisions. What is the expected transfer price?
Answer:
a) The transfer price TP is the market ( $ 320 )
b)
- minimum transfer price : $ 296
- maximum transfer price : $ 320
c) the expected transfer price is $ 194
Explanation:
Given the data in the question;
a) What should the transfer price be?
The transfer price TP is the market ( $ 320 ) as all the dishwashers produced will be sold to the external customers for $ 320 .
b) Identify the maximum and minimum transfer prices?
Refer to question 1 above and assuming $24 of avoidable distribution costs.
the maximum and minimum transfer prices will be;
- minimum transfer price : $ 320 - $ 24 = $ 296
- maximum transfer price : $ 320
c) What is the expected transfer price?
given that; the variable costs of manufacturing the dishwashers are $98.
The Manufactured Housing Division is currently buying 4,000 dishwashers from an outside supplier for $290 each.
so potential gain = $290 - $98
= $ 192
thus, share of gain of each division will be;
⇒ $ 192 / 2 = $ 96
so the transfer price will be;
⇒ $ 98 + $ 96
= $ 194
Therefore, the expected transfer price is $ 194
You send out 20,000 emails. Of those, 6% are opened. Of those, 9% click on a link to register for something. Of those who clicked the link, 30% complete the registration. How many people completed the registration?
Mrs. Eller's corporate employer has a cafeteria plan under which its employees can receive a $3,000 year-end Christmas bonus or enroll in a qualified medical reimbursement plan that pays up to $3,000 of annual medical bills. Mrs. Eller is in a 24 percent tax bracket, and her medical bills average $2,300 each year.
a. Should Mrs. Eller choose the cash bonus or the nontaxable fringe benefit? (Ignore any payroll tax implications.)
b. Does your answer change if Mrs. Eller is in the 12 percent tax bracket?
Answer and Explanation:
a. The computation is shown below;
Cash bonus after tax is ($3,000 × (1 - 0.24) $2,280
And, non taxable fringe benefit is $2,300
So here he should use the nontaxable fringe benefit
b. Yes answer would be changed
Cash bonus after tax is ($3,000 × (1 - 0.12) $2,640
And, non taxable fringe benefit is $2,300
hence, the same is to be considered
6. Problems and Applications Q6 Suppose the Federal Reserve's policy is to maintain low and stable inflation by keeping unemployment at its natural rate. However, the Fed believes that the natural rate of unemployment is 4 percent when the actual natural rate is 5 percent. If the Fed bases its policy decisions on its belief, there will be a
Answer: Rising trend
Explanation:
If the actual natural rate is 5%, it would be higher than the natural rate of 4%. This would prompt the Fed to act in such a way as to reduce unemployment in the economy. To do this, they would embark on an expansionary monetary policy to get the economy growing so that more people can be employed.
When there is more money in the economy though, people will have more to buy goods and services and this increase in demand will cause inflation to rise to reflect that there is more demand than supply.
what is a marketing plan ?? answer please .
Answer:
marketing plan is defined as a comprehensive document or blueprint that outlines the advertising and marketing efforts for the coming year. It describes business activities involved in accomplishing specific marketing objectives within a set time frame. A marketing plan also includes a description of the current marketing position of a business, a discussion of the target market and a description of the marketing mix that a business will use to achieve their marketing goals.
The D. Dorner Farms Corporation is considering purchasing one of two fertilizer-herbicides for the upcoming year. The more expensive of the two is better and will produce a higher yield. Assume these projects are mutually exclusive and that the required rate of return is 10 percent. Given the following free cash flows:
Product A Product B
Initial outlay -$5000 -$5000
Inflow year 1 700 6,000
Required:
a. Calculate the NPV of each project.
b. Calculate the PI of each project.
c. Calculate the IRR of each project.
d. If there is no capital-rationing constraint, which project should be selected? If there is a capital-rationing constraint, how should the decision be made?
Question Correction:
The question stated that there is a more expensive fertilizer-herbicide. Therefore, their initial outlays cannot be equal as stated. Instead, the correct cash flows, including initial outlays are:
Product A Product B
Initial outlay -$500 -$5000
Inflow year 1 700 6,000
Answer:
The D. Dorner Farms Corporation
Product A Product B
a. NPV = $136 $454
b. PI = 1.272 1.091
c. IRR = 27.2% 9.08%
d. If there is no capital-rationing constraint, Project B should be chosen despite its poor PI and IRR performances, but for returning a larger NPV.
e. If there is a capital-rationing constraint, Project A should be chosen because of its more impressive PI and IRR performances.
Explanation:
a) Data and Calculations:
Required rate of return for the projects = 10%
Present factor of 10% for 1 year = 0.909
Free cash flows:
Product A Product B
Initial outlay -$500 -$5000
Inflow year 1 700 6,000
Present values:
Product A Product B
Initial outlay -$500 -$5000
Inflow year 1 636 5,454
NPV = $136 $454
b) PI (Profitability Index) is a useful tool in capital budgeting which measures the profit potential of a project in order to ease decisions. It is computed by dividing the present value of cash inflows by the initial investment cost. Another formula is: 1 + (NPV/Initial outlay).
Therefore, the PI for each project is calculated as follows:
PI = 1+ (NPV/Initial outlay)
Product A Product B
PI = 1 + ($136/$500) 1 + ($454/$5,000)
= 1.272 1.091
IRR (Internal Rate of Return) = NPV/Initial Outlay
Product A Product B
IRR = $136/$500 * 100 $454/$5,000 * 100
= 27.2% 9.08%
Logistics Solutions provides order fulfillment services for dot merchants. The company maintains warehouses that stock items carried by its dot clients. When a client receives an order from a customer, the order is forwarded to Logistics Solutions, which pulls the item from storage, packs it, and ships it to the customer. The company uses a predetermined variable overhead rate based on direct labor-hours.
In the most recent month, 185,000 items were shipped to customers using 8,000 direct labor-hours. The company incurred a total of $27600 in variable overhead costs. According to the company's standards, 0.04 direct labor-hours are required to fulfill an order for one item and the variable overhead rate is $3.50 per direct labor-hour.
Required:
a. What is the standard labor-hours allowed (SH) to ship 185,000 items to customers?
b. What is the standard variable overhead cost allowed (SH SR) to ship 185,000 items to customers?
c. What is the variable overhead spending variance?
d. What is the variable overhead rate variance and the variable overhead efficiency variance?
Answer:
Standard labor-hours allowed= 7,400 direct labor Hours.
The standard variable overhead cost= $ 25,900
Variable overhead spending variance =$400
Variable overhead rate variance =$400
Variable overhead efficiency variance=$2,100
Explanation
a.) The standard labor-hours allowed (SH) to ship 185,000 items to customers
= 0.04 direct labor-hours x 185,000= 7,400 direct labor Hours.
b). The standard variable overhead cost allowed to ship 185,000 items to customers=
standard labor-hours SH × Standard Rate SR
7400 X $3.50= $ 25,900
c). Variable overhead spending variance is calculated as
Actual Overhead Costs - Actual hours x Standard Rate
= $27600 - 8,000 x 3.50 = $27600 -28,000
=$400
d1). Variable overhead rate variance =
Actual hours x Actual Variable Overhead Rate per Hour - Actual hours Standard Variable Overhead Rate per Hour
Variable overhead rate variance =8000 x (27600/8000) - 8000 x 3.50
8000 x 3.45 - 8000 x 3.50
27,600-28,000=$400
d2) Variable overhead efficiency variance= Actual Hours x Standard Rate - Standard Hours x Standard Rate
8000 x 3.50 -7400 x 3.50
28,000 -25,900
=$2,100
Starting with the finished version of the file for Example 9.3, change the fixed cost in cell B5 to $4000. Change the probabilities in cells B9 (make it smaller), B14 (make it larger), and B15 (make it smaller) in some systematic way (you can choose the details) and, for each combination, calculate the EVI. Does EVI change in the way you’d expect? Why?
Answer:
hello your question lacks the required file ( excel file ) attached below is the missing file
Answer : The EVI does not change in the way expected and this is because of the higher probability assignment
Explanation:
1) calculate the EVI for the first combination
i.e. B5 = $2000, B9 = 0.4, B14 = 0.8, B15 = 0.3
EVI = EMI with information - EMI without information
= 3250 - 3400
= $ 150
note : EMI with information is gotten via solution tree
2) Calculate the EVI for the second combination
i.e. B5 = $4000 , B9 = 0.3 , B14 = 0.9, B15 = 0.2
EVI = EMI with information - EMI without information
= $1378 - $500 = $878
How are a startup's financing requirements estimated
Answer:
How are Startups Financing Requirements Estimated?
1. Make Use of a Startup Work Sheet to be Able to Plan the Initial Financing.
2. Focus on the Expenses versus Assets. Another way for startups to estimate their financing requirements is by means of focusing on the expenses versus assets.
3. Similar Articles.
4. Cash Balance Prior to the Starting Date.
Explanation:
QS 7-5 (Algo) Allowance method for bad debts LO P2 Gomez Corp. uses the allowance method to account for uncollectibles. On January 31, it wrote off an $2,800 account of a customer, C. Green. On March 9, it receives a $2,300 payment from Green. 1. Prepare the journal entry for January 31. 2. Prepare the journal entries for March 9; assume no additional money is expected from Green.
Answer:
1. Jan 31
Dr Allowance for doubtful accounts $2,800
Cr Accounts receivable—C. Green $2,800
2. Mar 09
Dr Accounts receivable—C. Green $2,300
Cr Allowance for doubtful accounts $2,300
3. Mar 09
Dr Cash $2,300
Cr Accounts receivable—C. Green $2,300
Explanation:
1. Preparation of the journal entry for January 31.
Jan 31
Dr Allowance for doubtful accounts $2,800
Cr Accounts receivable—C. Green $2,800
2. Preparation of the journal entry for March 9
Mar 09
Dr Accounts receivable—C. Green $2,300
Cr Allowance for doubtful accounts $2,300
3. Mar 09
Dr Cash $2,300
Cr Accounts receivable—C. Green $2,300
Trinkle Co., Inc. made several purchases of long-term assets in Year 1. The details of each purchase are presented here.
New Office Equipment
1. List price: $41,900; terms: 2/10 n/30; paid within discount period.
2. Transportation-in: $860. Installation: $510.
3. Cost to repair damage during unloading: $431.
5. Routine maintenance cost after six months: $110.
Basket Purchase of Copier, Computer, and Scanner for $51,000 with Fair Market Values
1. Copier $22,755.
2. Computer $6,765.
3. Scanner $31,980.
Land for New Warehouse with an Old Building Torn Down
1. Purchase price, $82,400.
2. Demolition of building, $4,750.
3. Lumber sold from old building, $1,800.
4. Grading in preparation for new building, $7,700.
5. Construction of new building, $217,000.
Required:
In each of these cases, determine the amount of cost to be capitalized in the asset accounts.
Answer:
New Office Equipment $42,863
Basket Purchase Of Copier, Computer, Scanner $61,500
Land For New Warehouse $310,050
Explanation:
Calculation to determine the amount of cost to be capitalized in the asset accounts
NEW OFFICE EQUIPMENT
Amount of cost to be capitalised in the asset accounts = $41,900*0.98+$860+$510+$431
Amount of cost to be capitalised in the asset accounts =$41,062+$860+$510+$431
Amount of cost to be capitalised in the asset accounts =$42,863
BASKET PURCHASE OF COPIER, COMPUTER AND SCANNER
Amount of cost to be capitalised in the asset accounts = $22,755 + $6,765 + $31,980
Amount of cost to be capitalised in the asset accounts= $61,500
LAND FOR NEW WAREHOUSE with an old building torn down
Amount of cost to be capitalised in the asset accounts = $82,400 + $4,750 - $1,800 + $7,700 + $217,000
Amount of cost to be capitalised in the asset accounts = $310,050
Therefore The Amount of cost to be capitalised in the asset accounts are:
New Office Equipment $42,863
Basket Purchase Of Copier, Computer, Scanner $61,500
Land For New Warehouse $310,050
Dawson Toys, Ltd., produces a toy called the Maze. The company has recently created a standard cost system to help control costs and has established the following standards for the Maze toy:
Direct materials: 6 microns per toy at $1.50 per micron
Direct labor: 1.3 hours per toy at $21 per hour
During July, the company produced 3,000 Maze toys. The toy's production data for the month are as follows: Direct materials: 25,000 microns were purchased at a cost of $1.48 per micron. 5,000 of these microns were still in inventory at the end of the month. Direct labor: 4,000 direct labor-hours were worked at a cost of $88,000.
Required:
Compute the variances for July.
Answer and Explanation:
The computation of the variance is shown below;
a) Material price variance is
= (Standard price - actual price) × actual quantity
= ($1.5 - $1.48) × 25000
= $500 F
b. Material quantity variance is
= (Standard quantity - actual quantity) × Standard price
= (3000 × 6 - 20,000) × 1.5
= $3,000 U
c) Labor rate variance is
= (Standard rate - actual rate) × actual hours
= ($21 × 4000 - $88,000)
= $4,000 U
d. Labor efficiency variance is
= (Standard hour - actual hour) × Standard rate
= (3000 × 1.3 - 4000) × 21
= $2,100 U
Q 9.20: City Mission is a not-for-profit organization that provides hot meals, living quarters, and showers for homeless people. Based on their yearly budget, they expect to spend $450,000 on food expenses, $350,000 on housing expenses, $280,000 on staff salaries, $90,000 on utilities, and $118,000 on other expenses. How much will City Mission need to raise in donations
Answer:
at least $1,288,000 in donation
Explanation:
With regards to the above information, we would add up all the expenses to arrive at how much donation that need City Mission needs to raise.
= Expenses on food + Housing expenses + Staff salaries + Utilities + Other expenses
= $450,000 + $350,000 + $280,000 + $90,000 + $118,000
= $1,288,000
The above is a large sum of money to raise only from donations, and by right a level or various levels of government should help pay for these expenses as no one go homeless either that or provide low cost homes for the homeless.
Andrea has prepared the following list of statements about corporations. Identify whether each statement is true or false. 1. A corporation is an entity separate and distinct from its owners. select an option 2. As a legal entity, a corporation has most of the rights and privileges of a person. select an option 3. Most of the largest U.S. corporations are privately held corporations. select an option 4. Corporations may buy, own, and sell property; borrow money; enter into legally binding contracts; and sue and be sued. select an option 5. The net income of a corporation is not taxed as a separate entity. select an option 6. Creditors have a legal claim on the personal assets of the owners of a corporation if the corporation does not pay its debts. select an option 7. The transfer of stock from one owner to another requires the approval of either the corporation or other stockholders. select an option 8. The board of directors of a corporation legally owns the corporation. select an option 9. The chief accounting officer of a corporation is the controller. select an option 10. Corporations are subject to fewer state and federal regulations than partnerships or proprietorships.
Answer:
1. TRUE.
A corporation truly is separate from its owners.
2. TRUE.
As a result of this separation, it has most of the rights and privileges of a person.
3. FALSE.
Most of the largest American companies are public held corporations which is how they got the resources needed for expansion.
4. TRUE.
As corporations are separate entities, they can do all these things.
5. FALSE.
The net income of a corporation is taxed as separate from the income of the owners.
6. FALSE.
Creditors only have a legal claim to the assets of the corporation and not its owners because they are separate entities.
7. FALSE.
The transfer of stock requires the permission of the stockholder selling the stock and the party buying. This is a two party transaction that does not require company approval.
8. FALSE.
The shareholders own the corporation. The Board of Directors simply represent the shareholders.
9. TRUE.
The Chief Accounting Officer truly is the controller.
10 . FALSE.
Corporations are subject to more regulations than partnerships and proprietorships.
At the beginning of his current tax year, Eric bought a corporate bond with a maturity value of $25,000 from the secondary market for $17,800. The bond has a stated annual interest rate of 8 percent payable on June 30 and December 31, and it matures in five years on December 31. Absent any special tax elections, how much interest income will Eric report from the bond this year and in the year the bond matures
Answer: See explanation
Explanation:
Based on the information given in the question, the interest income reported this year will be:
= ($25000 × 8%/2) × 2
= $25000 × 0.04 × 2
= $2000
The interest income that will be reported in the year the bond matures will be:
= $2000 + ($25000 - $17800)
= $2000 + $7200
= $9200
The budgeted income statement presented below is for Burkett Corporation for the coming fiscal year. Compute the number of units that must be sold in order to achieve a target pretax income of $183,500. Sales (55,000 units) $ 990,000 Costs: Direct materials $ 202,000 Direct labor 240,500 Fixed factory overhead 102,500 Variable factory overhead 150,500 Fixed marketing costs 110,500 Variable marketing costs 50,500 856,500 Pretax income $ 133,500
Answer:
see explanation
Explanation:
Units to achieve target profit = Target Profit + Fixed Cost ÷ Contribution margin ratio.
where ,
Contribution margin ratio = Contribution ÷ Sales
Residents of poor countries tend to have fewer automobiles per capita because Group of answer choices lower per capita real gross domestic product (GDP) growth rates allow for less spending on automobiles. residents of poor countries generally prefer to walk. tax rates are higher in poor countries, which leaves less money to spend on cars. residents of poor countries tend to live on farms, where cars are unnecessary. residents of wealthy countries have automobiles provided to them by the government.
Answer:
lower per capita real gross domestic product (GDP) growth rates allow for less spending on automobiles.
Explanation:
Gross Domestic Products (GDP) is a measure of the total market value of all finished goods and services made within a country during a specific period.
Simply stated, GDP is a measure of the total income of all individuals in an economy and the total expenses incurred on the economy's output of goods and services in a particular country.
Generally, the Gross Domestic Products (GDP) of a country's economy gives an insight to the social well-being of the country, such as;
Adjusting the Real gross domestic product (Real GDP) for price level changes by using a price index. This simply means, Real GDP is adjusted for inflation to measure the value of goods and services produced by a country in a specific period of time.
Mathematically, [tex]{Real GDP}=\frac{\text{Nominal GDP}}{\text{GDP deflator}}[/tex]
Hence, residents of poor countries tend to have fewer automobiles per capita because lower per capita real gross domestic product (GDP) growth rates allow for less spending on automobiles.
Consider the economies of Sporon and Gribinez, both of which produce agricultural products using only land and labor. The following tables show the supply of land, population size, and real GDP for these two economies from 2020 to 2023. Calculate real GDP per capita for the two economies, and complete the last column of the following two tables.
Sporon
Year Land Population Real GDP Real GDP per Capita
(Acres)
2020 20,000 1,000 $15,000 $
2021 20,000 2,000 $28,000 $
2022 20,000 3,000 $36,000 $
2023 20,000 4,000 $40,000 $
Gribinez
Year Land Population Real GDP Real GDP per Capita
(Acres)
2020 20,000 500 $4,500 $
2021 20,000 1,000 $10,000 $
2022 20,000 1,500 $16,500 $
2023 20,000 2,000 $24,000 $
Rapid population growth tends to threaten economic growth in economies with land-to-labor ratios. Which of the following is a correct description of the effect of population growth on economic growth in Gribinez from 2020 to 2023?
a. *Real GDP per capita rose initially but eventually fell as population continued to expand.
b. *Real GDP per capita rose from 2011 to 2014 as population increased.
c. *Real GDP per capita fell in*Real GDP per capita fell from 2011 to 2014 as population increased.
Answer:
Sporon
2020 $15
2021 $14
2022 $12
2023 $10
Gribinez
2020 $9
2021 $10
2022 $11
2023 $12
Real GDP per capita rose from 2020 to 2023 as population increased.
Explanation:
Real Per capita GDP measures the standard of living of the people in a country. The higher the Real Per capita GDP, the higher the standard of living
Real Per capita GDP = Real GDP / population
Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year
GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export
Real GDP is GDP calculated using base year prices. Real GDP has been adjusted for inflation.
Sporon
2020 : $15,000 / 1000 = $15
2021: $28,000 / 2000 = $14
2022 : $36,000 /3,000 = $12
2023: $40,000/4000 = $10
Gribinez
2020 : $4500 / 500= $9
2021 : $10,000 / 1000 = $10
2022 $16,500 / 1500= $11
2023: $24,000 / 2000 = $12
The real GDP per capita of Gribinez rose from 2011 to 2014 as population increased because the rate of increase of real GDP per capita was higher than the rate of increase in population
Rate of increase of population in 2022 = (1500 / 1000) - 1 = 0.5 = 50%
Rate of increase in Real GDP in 2022 = (16500 / 10,000) - 1 = 0.65 = 65%
On December 31, 2016, Beckford Company issues 150,000 stock-appreciation rights to its officers entitling them to receive cash for the difference between the market price of its stock and a pre-established price of $10. The fair value of the SARs is estimated to be $4 per SAR on December 31, 2017; $1 on December 31, 2018; $10 on December 31, 2019; and $9 on December 31, 2020. The service period is 4 years, and the exercise period is 7 years.
Instructions:
(a) Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan.
(b) Prepare the entry at December 31, 2014, to record compensation expense, if any, in 2014.
(c) Prepare the entry on December 31, 2014, assuming that all 150,000 SARs are exercised.
Answer: See attachment and explanation
Explanation:
(a) Prepare a schedule that shows the amount of compensation expense allocable to each year affected by the stock-appreciation rights plan.
The above has been attached.
(b) Prepare the entry at December 31, 2014, to record compensation expense, if any, in 2014.
31/12/2014:
Debit Compensation expense = $225000
Credit Stock Appreciation Plan = $225000
(To record the compensation expense)
(c) Prepare the entry on December 31, 2014, assuming that all 150,000 SARs are exercised.
31/12/2014:
Debit: Stock Appreciation Plan = $1350000
Credit Cash = $1350000
(To record the realization of cash exercised)
Ann Company borrowed $240,000 to buy an equipment on January 1, 2019, and signed a 7% instalment note requiring annual equal payments, including principal and interest at the end of every year for 15 years. Rounded to the nearest dollar, determine the balance in the Instalment Note Payable account after making the first annual payment.
Answer:
$2,000
Explanation:
Payment include repayment of Capital Amount and Payment of Interest expense
Therefore the balance in the Instalment Note Payable account after making the first annual payment is
wo firms, A and B, each currently emit 100 tons of chemicals into the air. The government has decided to reduce the pollution and from now on require a pollution permit for each ton of pollution emitted into the air. The government gives each firm 50 pollution permits, which it can either use of sell to the other firm. It costs Firm A $200 for each ton of pollution that it eliminates before it is emitted into the air, and it cots Firm B $100 for each ton of pollution that it eliminates before it is emitted into the air. If the two firms have the same bargaining power, what would be the gains from trade for Firm B
Answer:
Firm A will buy all of the firm B's pollution permits. Each one will cost between $100 and $200.
Explanation:
The firm B will gain from the trade of pollution permits. Firm A will need higher pollution permits since it emits 100 tons of chemicals into air and the cost for eliminating each ton is $200. This cost is higher than the cost to Firm B which is $100 only. Firm A will buy all the pollution permits from Firm B and there will advantage for the Firm B to gain from the trade.
9. The NOI for a small income property is expected to be $150,000 for the first year. Financing will be based on a 1.2 DCR applied to the first year NOI, will have a 10 percent interest rate, and will be amortized over 20 years with monthly payments. The NOI will increase 3 percent per year after the first year. The investor expects to hold the property for five years. The resale price is estimated by applying a 9 percent terminal capitalization rate to the sixth-year NOI. Investors require a 12 percent rate of return on equity (equity yield rate) for this type of property. a. What is the present value of the equity interest in the property
Answer:
a. The present value of the equity interest in the property is:
= PV = $1,096,338
Explanation:
a) Data and Calculations:
Debt Coverage Ratio = 1.2
Debt interest = $150,000/1.2 = $125,000
Interest rate = 10%
Therefore, total financing or debt obtained = $125,000/10% = $1,250,000
NOI for the first year = $150,000
NOI for other years = 3% per year after the first year.
Holding period of property = 5 years
Therefore, expected NOIs for the second to fifth year are calculated as follows:
Net operating income (NOI):
First Year = $150,000
Second Year = $154,500 ($150,000 * 1.03)
Third Year = $159,135 ($154,500 * 1.03)
Fourth Year = $163,909 ($159,135 * 1.03)
Fifth Year = $168,826 ($163,909 * 1.03)
Sixth year NOI = $173,891 ($168,826 * 1.03)
Terminal capitalization rate = 9%
Resale price = NOI of the sixth year/Terminal cap rate
= $173,891/9% = $1,932,122
The present value of the equity interest in the property:
From an online financial calculator:
N (# of periods) 5
I/Y (Interest per year) 12
PMT (Periodic Payment) 0
FV (Future Value) $1,932,122
Results
PV = $1,096,337.91
Total Interest $835,784.09
What is the relationship between property and financial claims
Your boss has asked you to obtain marketing feedback on one of the products for your company produces. But people are less likely to respond honestly if they know it’s the company requesting the information. So your boss tells you to use a fake marketing research name. Would you follow your boss’s direction? Why or why not?
Answer:
no I won't follow my boss
because I don't use Fake information
William is preparing to file his tax return. Which two items are necessary to complete his tax return?
W-2 form from an employer
driver's license
receipts for expenses taken as deductions or credits
copy of a birth certificate
voter registration card
employment verification
Answer:
W-2 form from an employer, Receipts for expenses taken as deductions or credits
Explanation:
Got it right on Plato
Classical economists support which amount of
government intervention into the economy?
A. limited
B. negligent
C. large
On January 1, 2020, Blue Inc. had cash and common stock of $62,340. At that date, the company had no other asset, liability, or equity balances. On January 2, 2020, it purchased for cash $22,990 of debt securities that it classified as available-for-sale. It received interest of $4,480 during the year on these securities. In addition, it has an unrealized holding gain on these securities of $5,100 net of tax. Determine the following amounts for 2020: (a) net income, (b) comprehensive income, (c) other comprehensive income, and (d) accumulated other comprehensive income (end of 2020).
Answer:
(a) Net income = $3,000
(b) Comprehensive income = $7,000
(c) Other comprehensive income = $4,000
(d) Accumulated other comprehensive income = $4,000
Explanation:
This question is based on multi-step income statement. Therefore, some of the elements of the multi-step income statement are employed in answering this question.
(a) net income
This can be calculated as follows:
Net income = Operating income + Total other income and expense – Tax expense ………… (1)
Where, based on information in the question, we have:
Operating income = Not available = 0
Total other income and expense = Interest income = $3,000
Tax expense = Not available = 0
Substituting the values into equation (1), we have:
Net income = 0 + $3,000 – 0 = $3,000
(b) comprehensive income
This can be calculated as follows:
Comprehensive income = Net income + Other comprehensive income …... (2)
Where:
Net income = $3,000
Other comprehensive income = Unrealized holding gain on securities = $4,000
Substituting the values into equation (2), we have:
Comprehensive income = $3,000 + $4,000 = $7,000
(c) other comprehensive income
As already stated in part (b) above, we have:
Other comprehensive income = Unrealized holding gain on securities = $4,000
(d) accumulated other comprehensive income (end of 2020).
As there is no other income from the question, this implies that:
Accumulated other comprehensive income = Unrealized holding gain on securities = $4,000
Analysis of Receivables Method At the end of the current year, Accounts Receivable has a balance of $770,000; Allowance for Doubtful Accounts has a credit balance of $7,000; and sales for the year total $3,470,000. Using the aging method, the balance of Allowance for Doubtful Accounts is estimated as $32,200. a. Determine the amount of the adjusting entry for uncollectible accounts. $fill in the blank 1 b. Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Accounts Receivable $fill in the blank 2 Allowance for Doubtful Accounts $fill in the blank 3 Bad Debt Expense $fill in the blank 4 c. Determine the net realizable value of accounts receivable.
Answer:
A. $25,200
B. Accounts Receivable $770,000
Allowance for Doubtful Accounts $32,200
Bad Debt Expense $25,200
C. $744,800
Explanation:
a. Calculation to Determine the amount of the adjusting entry for uncollectible accounts using this formula
Uncollectible accounts Adjusting entry= Allowance for Doubtful Accounts - Credit balance on Allowance for doubtful accounts
Let plug in the formula
Uncollectible accounts Adjusting entry=$32,200 - $7,000
Uncollectible accounts Adjusting entry= $25,200
Therefore the amount of the adjusting entry for uncollectible accounts is $25,200
B. Based on the information given the adjusted balances of Accounts Receivable will be $770,000
Based on the information given the adjusted balances of Allowance for Doubtful Accounts will be $32,200
Bad Debt Expense = $32,200 - $7,000
Bad Debt Expense= $25,200
c. Calculation to Determine the net realizable value of accounts receivable
Using this formula
Net realizable value of accounts receivable = Accounts receivables - Bad debt
Let plug in the formula
Net realizable value of accounts receivable= $770,000 - $25,200
Net realizable value of accounts receivable=$744,800
Therefore Net realizable value of accounts receivable is $744,800
Maplewood Company incurred the following costs for 70,000 units: Variable costs $420,000 Fixed costs 392,000 Maplewood has received a special order from a foreign company for 3,000 units. There is sufficient capacity to fill the order without jeopardizing regular sales. Filling the order will require spending an additional $6,300 for shipping. If Maplewood wants to break even on the order, what should the unit sales price be
Answer:
$8.1
Explanation:
Variable cost to be incurred for the offer = ($420,000/70,000) * 3,000
Variable cost to be incurred for the offer = $6 * 3,000
Variable cost to be incurred for the offer = $18,000
Additional Fixed cost = $6,300
Total Cost incurred for the offer = Variable cost to be incurred for the offer + Additional Fixed cost
Total Cost incurred for the offer = $18,000 + $6,300
Total Cost incurred for the offer = $24,300
Unit Sales Price (Break even) = Total Cost incurred for the offer / 3,000 units
Unit Sales Price (Break even) = $24,300 / 3,000 units
Unit Sales Price (Break even) = $8.1
Beachfront property owners of the Town of Eden Beach requesteda financed through a note payable, which was to be repaid from taxes raised through a special assessment on their properties. The Town guarantees the debt and accounts for the special assessment through a debt service fund. Assume the special assessments were levied in 2016, recording a special assessment receivable an assessment is to be collected each year and used to pay the interest and principal on the note d deferred inflow in the amount of $480,000. One-third of the
Record the following transactions that occurred in 2017
1 June 30. S160000 of the assessments became due and currently receivable (Hint The special assessment tax is recorded as revenue in the debt service fund when it becomes due)
2. July 31, the $160.000 was collected
3 September 30, interest of $24.000 and principal of $136.000 were paid
4 December 31, the books were closed
If no entry is required for e transaction/event, select "No Journal Entry Required" in the first account field.)
Answer: See explanation
Explanation:
The journal entries for the transaction goes thus:
June30:
Debit Deferred revenue 160,000
Credit Special assessment revenue 160,000
July 31:
Debit Cash 160,000
Credit special assesement tax receivable 160,000
September 30:
Debit interest expenditure 24,000
Debit principal expenditure 136,000
Credit cash 160,000
December 31:
Debit Special assesement revenue 160,000.00
Credit interest expenditure 24,000
Credit Principal expenditure 136,000
how much should a charm bracelet be with 1 tassel and mermaid tail.
Answer: The cost should be around $6 at least
Explanation:
Answer:
any where from 10 to 24 dollars. If it super lux maybe 50 something
Explanation: