Answer:
c. Costs that can be avoided by selecting a particular course of action.
Explanation:
An avoidable cost is an expense that cannot be spent in the case when the activity is not performed. It refer to the variable cost where it can be eliminated from the busines operation like fixed cost that should be paid whether the activity is done or not
So here it can be avoided by choosing out a specific course of action
hence, the option c is correct
The direct materials and direct labor budgets provide information for preparing the Group of answer choices sales budget. production budget. manufacturing overhead budget. cash budget.
Answer:
The correct answer is the last option: Cash budget.
Explanation:
To begin with, the term known as "Cash Budget" in the field of finances and business management refers to the type of budget that specifically focus on the estimation of the cash flows of the company in a particular amount of time. Therefore that this budget helps the organization to see how much of cash they are having and more importantly how it flows over a given period of time that could be either a week, a month or a year, etc. It is necessary to manage to a certain level of sales and control de expenditures in order to have a good cash flow which is monitored by the cash budget.
Rhonda purchased a %, zero-coupon bond with a -year maturity and a $ par value years ago. The bond matures tomorrow. How much will Rhonda receive in total from this investment, assuming all payments are made on these bonds as expected?
Answer:
$15,000
Explanation:
Complete question "Rhett purchased a 12% zero-coupon bond with a 15-year maturity and a $15,000 par value 15 years ago. The bond matures tomorrow. How much will Rhett receive in total from this investment, assuming all payments are made on these bonds as expected?"
Zero Coupon Bonds means exactly what the name carries and suggested "Zero Coupon (Interest) bonds".
This Coupon Bond pays no interest to the bond holders and are issued at deep discount to its face value.
Zero Coupon Bonds are matured at par value, meaning the maturity amount to the paid is equals to the par value. In other word, the bondholders will get only Par Value of the bond at maturity.
So here, Rhett will receive on maturity date the amount of $15,000.
Heavy Metal Corporation is expected to generate the following free cash flows over the next three years. Thereafter, the free cash flows are expected to grow at the industry average of 2% per year (so that Year 4 FCF is 2% larger than Year3 FCF, and so on). Using the discounted free cash flow model and a WACC of 9%, estimate the enterprise value of Heavy Metal. Year 1 2 3 FCF ($ million) 10 20 30 Select one: a. $335.5 million b. $437.1 million c. $386.7 million d. $467.1 million
Answer:
c. $386.7 million
Explanation:
The enterprise value of the firm is the present value of its future free cash flows discounted at the weighted average cost of capital as well as the present value of free cash flow terminal value beyond year 3 as shown thus:
Year 1 FCF=$10 million
Year 2 FCF=$20 million
Year 3 FCF=$30 million
terminal value=Year 3 FCF*(1+terminal growth rate)/(WACC-terminal growth rate)
terminal growth rate=2%
WACC=9%
terminal value=$30*(1+2%)/(9%-2%)
terminal value=$437.14 million( $437.1 million is wrong as it is the terminal value, not the enterprise value)
present value of FCF=FCF/(1+WACC)^n
n is the year in which the free cash flow is expected, it is 1 for year 1 FCF, 2 for year 2 FCF , 3 for year 3 FCF as well as the terminal (the terminal value is also stated in year 3 terms)
enterprise value=$10/(1+9%)^1+$20/(1+9%)^2+$30/(1+9%)^3+$437.14 /(1+9%)^3
enterprise value= $386.7 milion
10 POINTS!! FINANCE
Explain how having an honest conversation about money can affect a person’s ability to take control of their finances.
Answer:
Having and honest conversation about money can affect them in many ways. They could realize how important it is and start to take control in action for it. They could realize if they don’t take control of it they’ll end up poor, homeless, or worse. They could also realize if they want a family, money and finance is what’s going to make that possible.
Explanation:
Options allow investors to get rid of the risks they do not want and keep the ones they do want. can be used for hedging but not for speculation. obligate the holder to sell the underlying asset at a predetermined price on or before a fixed date. allow investors to bet that the price of an underlying asset will rise but not that it will fall.
Answer:
allow investors to get rid of the risks they do not want and keep the ones they do want
Explanation:
In the option, it permit the investor to get rid of the risk as they dont want also it keeps that one which they want
The other options are to be considered incorrect as in the second option, it is used for the speculation also, the third option is wrong as the holders of the options have the right but not the obligation, and the last option is incorrect as it is used for bet in the case when the price is decline or increase
Therefore the first option is correct
Bonita Industries received $108000 in cash and a used computer with a fair value of $384000 from Carla Vista Co. for Bonita Industries's existing computer having a fair value of $492000 and an undepreciated cost of $461700 recorded on its books. The transaction has no commercial substance. How much gain should Bonita recognize on this exchange, and at what amount should the acquired computer be recorded, respectively
Answer:
$30,300 and $384,000
Explanation:
The computation of the gain and the amount should acquired is shown below;
The gain is
= Fair value - undepreciable cost
= $492,000 - $461,700
= $30,300
And, the amount at which the computed should be recorded is equivalent to the fair value i..e $384,000
The same is considered and relevant
Calculating return on investment for an investment center is defined by the following formula: Multiple Choice Gross profit/Ending assets. Contribution margin/Average invested assets. Income/Average invested assets. Net income/Ending assets. Contribution margin/Ending assets.
Answer:
Income/Average invested assets
Explanation:
We use the Income attributable to the investment and the average assets invested.
thus
Calculating return on investment for an investment center is defined by the following formula: Income/Average invested assets.
When researching and planning for your future career, you should consider these things about yourself?
O your hobbies and interests
O your personality
o the things you do well
o all of the above
SegR-7268 Corporation has two divisions, East and West. The following information was taken from last year's income statement segmented by division: East Division West Division Sales $3,700,000 $2,300,000 Contribution margin $1,650,000 $1,000,000 Divisional segment margin $1,100,000 $350,000 Net operating income last year for SegR-7268 Corporation was $600,000. In last year's income statement segmented by division, what were SegR-7268's total common fixed expenses?
a. $2,050,000
b. $850,000
c. $2,300,000
d. $1,200,000
Answer:
b. $850,000
Explanation:
Divisional Segment Margin = $1,100,000 + $350,000
Divisional Segment Margin = $1,450,000
Net Operating Income = $600,000
Common fixed expenses = Divisional Segment Margin - Net Operating Income
Common fixed expenses = $1,450,000 - $600,000
Common fixed expenses = $850,000
So, SegR-7268's total common fixed expenses will be $850,000.
Gordon Company reports the following information at the current fiscal year end of December 31: Common Stock, $0.10 par value per share $98,000 Additional Paid-in Capital , Common Stock 600,000 Retained Earnings 900,000 Total Stockholders' Equity $1,598,000 What was the average selling price for the common stock issued (rounded to the nearest cent)
Answer:
$0.71
Explanation:
Calculation to determine What was the average selling price for the common stock issued
Using this formula
Common stock issued avarage selling price=
Paid-in Capital in Excess of Par-Common÷Common Stock par value per share
Let plug in the formula
Common stock issued avarage selling price=($600,000+$98,000)/($98,000÷$0.10)
Common stock issued avarage selling price=$698,000/$980,000
Common stock issued avarage selling price=$0.71
Therefore the average selling price for the common stock issued is $0.71
A firm has total debt of $5,900 and a debt-equity ratio of 0.57. What is the value of the total assets?
A. $6,128.05.
B. $7,253.40.
C. $9,571.95.
D. $11,034.00.
E. $13,358.77.
Answer:
See below
Explanation:
Given the above information, we need to calculate first the total equity.
Total equity = Total debt / (Debt - Equity ratio)
Total equity = $5,900 / 0.57
Total equity = $10,350.877
Now,
Total assets = Total debt + Total equity
Total assets = $5,900 + $10,350.88
Total assets = $16,250.88
Therefore the value of the total assets are $16,250.88
Marks Corporation has two operating departments, Drilling and Grinding, and an office. The three categories of office expenses are allocated to the two departments using different allocation bases. The following information is available for the current period:
Office Expenses Total Allocation Basis
Salaries $ 31,000 Number of employees
Depreciation 20,500 Cost of goods sold
Advertising 41,500 Net sales
Item Drilling Grinding Total
Number of employees 1080 1620 2700
Net sales 326,625 477,375 804,000
Cost of goods sold 76,500 127,500 204,000
The amount of the total office expenses that should be allocated to Grinding for the current period is (Do not round your intermediate calculations.)
a) $56,054.
b) $46,204.
c) $93,000.
d) $36,954.
e) $600,000.
Answer:
a) $56,054.
Explanation:
The computation of the amount of the total office expenses that should be allocated to Grinding for the current period is shown below:
= Salaries + Depreciation + Advertising
= (31,000 ÷ 2700) × 1620 + (20,500 ÷ 204,000) × 127,500 + (41,500 ÷ 804,000) × 477,375
= $56,054
Hence, the first option is correct
It is important when regulating a market with a natural monopoly to maintain on going business incentives for the firm involved. A cost-plus approach to regulating a market does not provide this. What would a benefit to not utilizing a cost plus approach to regulation be
Answer:
The natural monopoly will have incentives for efficiency and innovation
Explanation:
Monopoly my be defined as taking or having an excessive control or charge over the trade of a particular commodity or product or the control over the supply of a particular product on the market by one particular group or person.
In the context, the cost-plus approach requires the monopoly in order to change the price which includes normal return to the average cost. So the monopolist does not have any incentive for innovating efficient technology so as to reduce its cost. Thus we can promote innovation and efficiency by not using the cost plus policy.
On Monday, May 15, 2017, you bought (traded) the XZX, Inc. 8.25% corporate bonds with a trading value of $96.50 price. The coupon payments are paid on March 31 and September 30. Using the 360-day accrual basis, calculate the invoice price of the bond. Please use T+3 to calculate the settlement day.
Answer:
$97.53
Explanation:
Coupon rate = 8.25%
Flate price of bond= $96.50
FV of bond (assumed) = $100
Purchase date = May 15
Last coupon payment was made on March 31, Accrued Interest = Face value * Days since last payment * Interest rate / Days in current coupon period
Accrued Interest = Face value * Days since last payment * Interest rate / Days in current coupon period
Accrued Interest = $100 * (May 15-March 31) * 8.25% / (2*(September 30-March 31))
Accrued Interest = $100*45*8.25% / (2*180)
Accrued Interest = $1.03
Invoice Value = Flate price + Accrued Interest
Invoice Value = $96.50 + $1.03
Invoice Value = $97.53
In Finance, _____ because _____. getting a return below your required return is OK; at least you are getting a return Cash is King; it is the only thing you can spend or invest investing in a projet in which not everyone is repaid his investment is OK; at least everyone is paid something
Answer: Cash is King; it is the only thing you can spend or invest
Explanation:
Finance is all about cash. Its all about getting cash from those who have it to those who need it so that the latter can invest and earn returns for both them and the people who invested the cash.
Simply put therefore, cash is king in finance. It is the only thing that can be invested so that one gets a return or can be spent so that one's needs are fulfilled. Indeed the term finance means the provision of cash which is why the field is so important. It is safe to say that there can be no economic growth without finance.
A similarity between monopoly and monopolistic competition is that in both market structures a. there are only a few buyers but many sellers. b. there are a small number of sellers. c. sellers are price makers rather than price takers. d. strategic interactions among sellers are important.
Answer:
c
Explanation:
A monopolistic competition is when there are many firms selling differentiated products in an industry. A monopolistic competition has characteristics of both a monopoly and a perfect competition. the demand curve is downward sloping. it sets the price for its goods and services.
An example of monopolistic competition are restaurants
When firms are earning positive economic profit, in the long run, firms enter into the industry. This drives economic profit to zero
If firms are earning negative economic profit, in the long run, firms leave the industry. This drives economic profit to zero
in the long run, only normal profit is earned
A monopoly is when there is only one firm operating in an industry. there are usually high barriers to entry of firms. the demand curve is downward sloping. it sets the price for its goods and services.
An example of a monopoly is a utility company
A price maker is a seller that sets the price for its goods and services. A monopoly and a monopolistic competition are price makers
Red Co. has a long-term construction contract that qualifies for revenue to be recognized over time. When Red is determining the amount of income to recognize for year two, which of the following items would Red not use in this calculation?1- Actual cost to date2- Income recognized in year one3- Progress billings to date4- Total expected cost
Answer:
Red Co.
The items that Red would not use in determining the amount of income to recognize for year two are:
2- Income recognized in year one
3- Progress billings to date
Explanation:
The income recognized in year one is purely for year one. It is not necessary to determine the income in year two. The progress billings to date do not impact the income to be recognized in any year. It is not relevant. The relevant items include the actual cost to date and the total expected cost vis-a-vis the expected total or contract revenue.
On January 1, 2021, Canseco Plumbing Fixtures purchased equipment for $30,000. Residual value at the end of an estimated four-year service life is expected to be $2,000. The company expects the equipment to operate for 10,000 hours. Calculate depreciation expense for 2021 and 2022 using each of the following depreciation meth- ods: (1) straight line, (2) double-declining balance, and (3) units-of-production using hours operated. The equip- ment operated for 2,200 and 3,000 hours in 2021 and 2022, respectively.
Answer:
1.
$7000
$7000
2.
$15,000
7500
3.
6160
8400
Explanation:
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
(30,000 - 2000) / 4= $7000
Depreciation expense using the double declining method = Depreciation factor x cost of the asset
Depreciation factor = 2 x (1/useful life)
2/4 x 30,000 = $15000
book value in year 2 = 15,000
2/4 x 15000 = 7500
Activity method based on output = (output produced that year / total output of the machine) x (Cost of asset - Salvage value)
2200 / 10,000 x (30,000 - 2000)
3000 / 10,000 x (30,000 - 2000)
What is the basic purpose of the consumer price index (CPI)? A. to track monthly changes in prices paid by urban consumers B. to track consumer spending on thousands of goods and services C. to predict future price increases for representative goods and services D. to predict and avoid deflation, or a decline in the general level of prices
Answer:
A). to track monthly changes in prices paid by urban consumers.
Explanation:
CPI(Consumer Price Index) is characterized as 'a statistical estimate of the price level of goods and services bought by consumers for consumption purposes by the households.' It primarily aims to estimate the change or swap in the prices of the weighted average price of the common basket(consumption goods, as well as, services that the consumers pay for). It is calculated using the formula;
[tex]CPI_{t} = \frac{C_{t} }{C_{0} } * 100[/tex]
where,
[tex]CPI_{t}[/tex] = current Consumer Price Index
[tex]C_{t}[/tex] = Current price basket
[tex]C_{0}[/tex] = Cost of price basket in the base year
It assists in deducing whether the average prices have received a fall or rise and determines inflation or deflation. Thus, option A is the correct answer.
Identify the type of adjustment that would most likely be needed. Business B purchased a piece of equipment to be used in operations for $5,000 during the middle of October. Today is December 31st, the end of the 4th quarter and financial reports are being produced. g
Answer: c . Depreciation
Explanation:
When accounting for fixed assets, it is important that they are recorded at their book value to reflect the effects of being utilized. This means that depreciation needs to be charged on fixed assets.
Even though the equipment in question was only purchased 2.5 months prior to the financial reports being made, depreciation still needs to be accounted for such that the equipment is represented at its book value in the financial statement.
On a particular day, there were 600 stocks that advanced on the NYSE and 700 that declined. The volume in advancing issues was 80,846,000, and the volume in declining issues was 70,397,000. The trin ratio is _ , and technical analysts are likely to be __.
Answer:
0.75 bearish
Explanation:
Calculation to determine what The trin ratio is, and technical analysts are likely to be .
Using this formula
Trin ratio=Advancing issues volume/Advance Stock NYSE/Volume in declining /Decline stock NYSE
Let plug in the formula
Trin ratio=70,397,000/700/80,846,000/600=1.11
Trin ratio=$100,567.14/$134,743.33
Trin ratio=0.75
Therefore The trin ratio is 0.75 and technical analysts are likely to be BEARISH
Daniel was surprised his store ran out of marshmallows so quickly. This typically does not happen during the spring, so he runs a(n) ________ to gather unplanned information to support if he should stock up on marshmallows.
Answer:
Ad-hoc report
Explanation:
From the question we are informed about how Daniel was surprised his store ran out of marshmallows so quickly. This typically does not happen during the spring, so in this case, he runs an Ad-hoc report to gather unplanned information to support if he should stock up on marshmallows.
Ad hoc report can be regarded as
a report that is created just for a one-time-use I e for a specific purpose.
With the use of BI tool there is possibility of anyone in an organization answering a specific business question and give presentation of that data in a visual format, even without given IT staff problems, Ad hoc report is different from structured report.
____ includes all elements existing outside the boundary of the organization that have the potential to affect the organization. a. Task environment b. Technological environment c. General environment d. Internal environment e. Organizational environment
Answer:
E
Explanation:
Organizational environment
A lease is a contract between a tenant and a __________ Response area. Most leases are for Response area __________ months.
Golden Eye Co., a hi-tech satellite company, has asked you to value the company for possible cross-listing in the U.S. The company has estimated revenues, earnings before interest and taxes, change in net working capital, and Net Capital spending (defined as Capital spending – depreciation) for the next three years (see Exhibit 1 below.) The free cash flow in year 4 is estimated to be $250 million and is expected to grow at 4% forever. The tax rate is 36%. The company’s unlevered cost of capital is 16.43%. Golden Eye Co. has just borrowed $1 billion of long-term debt at 9% interest rate. It will repay $200 million per year in the first three years, and then will maintain the debt at $400 million forever. What is the value of the firm?
Exhibit 1:
Year T=1 T=2 T=3
Revenues 6,619 7,417 8,564
EBIT 540 680 750
Net Capital spending 150 170 190
Change in NWC 70 75 80
Answer:
Explanation:
Let's first determine the free cash flow of the firm
Particulars Years
1 2 3
EBIT 540 680 750
Tax at 36% (0.36*540) (0.36*680) (0.36*750)
Less: 345.6 435.2 480
Net Capital -
Spending 150 170 190
Change in NWC 70 75 80
Less: 125.6 190.2 210
The terminal value at the end of T =(3 years) is:
[tex]= \dfrac{Free \ cash \ flow}{unlevered \ cost - expected \ growth \ rate}[/tex]
[tex]= \dfrac{250}{0.1643-0.04}[/tex]
[tex]= \dfrac{250}{0.1243}[/tex]
= 2011.26
Finally, the value of the firm can be computed as follows:
Years Free Cash Flow PVIF PV
1 125.6 0.6589 107.88
2 190.2 0.7377 140.31
3 210 0.6336 133.06
Terminal Value 2011.26 0.6336 1294.33
Value of the firm ⇒ $1655.58
Social Security Multiple Choice Is a Defined Benefit Pension Plan Is offered by local governments Is an optional Pension Plan Is a Defined Contribution Pension Plan g
Answer:
In simple words, Retired, incapacity, as well as survivor payments are all part of the Social Security program. In its nature, it is very much like a defined benefit pension plan.
Most employees contribute Social Security levies on their income to apply for many of these claims; claimants' advantages are dependent on the wages earner's payments. Aside from that, benefits like Supplemental Security Income (SSI) are dependent on use.
Which performance management evaluation criterion reflects the extent to which a performance measure assesses all the relevant - and only the relevant - aspects of performance
Answer:
E. Validity
Explanation:
This are options for the question
A. Reliability
B. Strategic congruence
C. Acceptability
D. Specificity
E. Validity
Performance evaluation can be regarded as process whereby manager or consultant carry out examination or evaluatation of an employee's work behavior through comparisons of it with preset standards, then the results of the comparison is documentd and uses to provide feedback to the employees and point where improvements are needed as well as reason why. Validity which is one of criterion for performance management evaluation gives reflection of the extent that a performance measure is been assessed with all the relevance aspects of performance
The ___ act requires companies to produce both an internal control report and an external audit.
A. Securities and Exchange
B. Dodd-Frank
C. Sarbanes-Oxley
D. Uniform Accounting
The Sarbanes-Oxley act requires companies to produce both an internal control report and an external audit.
The Sarbanes-Oxley Act (SOX) is a federal law enacted by the United States Congress in 2002 to improve corporate governance and financial reporting by public companies.
The act was a response to a series of high-profile accounting scandals in the early 2000s, such as Enron, WorldCom, and Tyco, which eroded investor confidence and caused significant financial losses for stakeholders.
Learn more about Sarbanes-Oxley act, here
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Xavier Co. wants to purchase a machine for $36,600 with a four year life and a $1,200 salvage value. Xavier requires an 8% return on investment. The expected year-end net cash flows are $11,600 in each of the four years. What is the machine's net present value
Answer:
$2702.71
Explanation:
Net present value is the present value of after-tax cash flows from an investment less the amount invested.
NPV can be calculated using a financial calculator
Cash flow in year 0 = $-36,600
Cash flow in year 1 - 3 = $11,600
Cash flow in year 4 = $11,600 + $1,200
I = 8%
NPV = 2702.71
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
Multiple Choice Questions _which level of management is responsible for establishing a vision for the organization, developing broad plans and strategies and directing of an organization set by executives?
Answer: Executive manager (Top manager)
Explanation:
Answer:
Top Level Managment
Explanation:
The level of management at which the managers are responsible for implementing and controlling the plans and strategies of the organization is Top Level Management. The top level managers are responsible to formulate plans and policies to achieve the set of organizational objectives.