Answer:
The percentage profit or loss if you purchase the stock and it rises to $33 a share is 20%
Explanation:
In order to calculate the percentage profit or loss if you purchase the stock and it rises to $33 a share we would have to make the following calculation:
percentage profit or loss=Total Gain/Amount invested
Amount invested=$30,000
According to the given data we have the following:
Share price=$30
Amount invested=$30000
Therefore, Number of shares purchased= ($30,000/50% *1/30)=$2,000
Gain per share ($33-$30)=$3
Therefore, Total Gain=$2,000*$3=$6,000
Therefore, percentage profit or loss= $6,000/$30,000
percentage profit or loss=20%
The percentage profit or loss if you purchase the stock and it rises to $33 a share is 20%
Flyer Company has provided the following information prior to any year-end bad debt adjustment:Cash sales, $167,000Credit sales, $467,000Selling and administrative expenses, $127,000Sales returns and allowances, $47,000Gross profit, $507,000Accounts receivable, $275,000Sales discounts, $31,000Allowance for doubtful accounts credit balance, $2,900Flyer estimates bad debt expense assuming that 2% of credit sales have historically been uncollectible. What is the balance in the allowance for doubtful accounts after bad debt expense is recorded?a) $12,240.b) $9,340.c) $9,780.d) $6,440.
Answer:
The balance in the allowance for doubtful accounts after bad debt expense is recorded is $12,240. Option A
Explanation:
Cash sales = $167,000
Credit sales = $467,000
Selling and administrative expenses = $127,000
Sales returns and allowances = $47,000
Gross profit = $507,000
Accounts receivable = $275,000
Sales discounts = $31,000
Allowance for doubtful accounts credit balance = $2,900
Balance needed in the 'Allowance for doubtful accounts' = $467,000 × 2%
= $9,240
Credit balance in the allowance account = $2,900
Bad debts expense = Balance needed in the 'Allowance for doubtful accounts' + Credit balance in the allowance account
= $9,340 + $2,900
= $12,240
The management of L Corporation is considering a project that would require an investment of $260,000 and would last for 6 years. The annual net operating income from the project would be $110,000, which includes depreciation of $17,000. The cash inflows occur evenly throughout the year. The payback period of the project is closest to (Ignore income taxes.):
Answer:
2.04 years
Explanation:
Payback period calculates the amount of the time it takes to recover the amount invested in a project from its cumulative cash flows.
To derive cash flows from net income, add depreciation to net income.
$110,000 + $17,000 = $127,000
Payback period = $260,000 / $127,000 = 2.04 years
I hope my answer helps you
The following information is available for a company's maintenance cost over the last seven months.
Month Maintenance Hours Maintenance Cost
June 9 $5,200
July 18 $6,650
August 12 4,850
September 15 5,750
October 21 6,650
November 24 6,950
December 6 3,350
Using the high-low method, estimate both the fixed and variable components of its maintenance cost.
High-Low method Calculation of variable cost per unit
Total cost at the high point ____
Variable costs at the high point
Volume at the high point: ____
Variable cost per unit ____
Total variable costs at the high point ____
Total fixed costs ____
Total cost at the low point ____
Variable costs at the low point
Volume at the low point ____
Variable cost per unit
Total variable costs at the low point
Total fixed costs ____
Answer:
Variable cost per unit= $240
Fixed costs= $1,910
Explanation:
Giving the following information:
June 9 $5,200
July 18 $6,650
August 12 4,850
September 15 5,750
October 21 6,650
November 24 6,950
December 6 3,350
To calculate the variable and fixed costs under the high-low method, we need to use the following formulas:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (6,950 - 3,350) / (21 - 6)
Variable cost per unit= $240
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 6,950 - (240*21)
Fixed costs= $1,910
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 3,350 - (240*6)
Fixed costs= $1,910
Using a time line The financial manager at Starbuck Industries is considering an investment that requires an initial outlay of $27 comma 000 and is expected to produce cash inflows of $2 comma 000 at the end of year 1, $6 comma 000 at the end of years 2 and 3, $ 10 comma 000 at the end of year 4, $7 comma 000 at the end of year 5, and $6 comma 000 at the end of year 6. a. Select the time line option that represents the cash flows associated with Starbuck Industries' proposed investment. b. Which of the approacheslong dashfuture value or present valuelong dashdo financial managers rely on most often for decision making? Why?
Answer:
Please check the attached image for a picture of the timeline
Present value
This is because financial managers are making decisions at the beginning of the projects. So, it is important to know if the project is successful in the present.
Explanation:
A timeline is shows events in a chronological order. The cash flows have to be arranged in accordance to the years they occurred and according to the timing of the cash flows.
I hope my answer helps you
A large international company has two business units. Invested assets and condensed income statement data for each business unit for the past year are as follows: Compute the following for Business Unit 1: a) Operating Income Using the Dupont Formula: b) Profit Margin % (round % to 1 decimal) c) Investment Turnover (round to 2 decimals) d) Return on Investment (round 1 decimal) Compute the following for Business Unit 2: 2A) Operating Income Using the Dupont Formula: 2B) Profit Margin (round % to 1 decimal) 2C) Investment Turnover (round to 2 decimals) 2D) Return on Investment (round 1 decimal)
Answer:
1. Compute the following for Business Unit 1:
a) Operating Income = $117,500
b) Profit Margin = 20.7%
c) Investment Turnover = 0.86
d) Return on Investment = 0.2
2. Compute the following for Business Unit 2:
a) Operating Income = $69,750
b) Profit Margin = 12.2%
c) Investment Turnover = 1.18
d) Return on Investment = 0.1
Explanation:
1. Compute the following for Business Unit 1:
a) Operating Income
Operating Income = Revenue – Operating expenses = $280,000 – $162,500 = $117,500
Using the Dupont Formula:
b) Profit Margin % (round % to 1 decimal)
Net income = Operating income – Services department charges = $117,500 - $59,500 = $58,000
Profit Margin = Net income / Revenue = ($58,000 / $280,000) * 100 = 20.7%
c) Investment Turnover (round to 2 decimals)
Investment Turnover = Revenue / Invested Assets = $280,000 / $325,000 = 0.86
d) Return on Investment (round 1 decimal)
Return on Investment = Net income / Invested Assets = $58,000 / $325,000 = 0.1785 = 0.2
2. Compute the following for Business Unit 2:
a) Operating Income
Operating Income = Revenue – Operating expenses = $222,500 – $152,750 = $69,750
Using the Dupont Formula:
b) Profit Margin % (round % to 1 decimal)
Net income = Operating income – Services department charges = $69,750 - $42,625 = $27,125
Profit Margin = Net income / Revenue = ($27,125 / $222,500) * 100 = 12.2%
c) Investment Turnover (round to 2 decimals)
Investment Turnover = Revenue / Invested Assets = $222,500 / $189,000 = 1.18
d) Return on Investment (round 1 decimal)
Return on Investment = Net income / Invested Assets = $27,125 / $189,000 = 0.1435 = 0.1
Lease A does not contain a bargain purchase option, but the lease term is equal to 90% of the estimated economic life of the leased property. Lease B does not transfer ownership of the property to the lessee by the end of the lease term, but the lease term is equal to 75% of the estimated economic life of the leased property. Based on this information alone, how should the lessee classify these leases
Answer: Lease A Capital lease
Lease B Capital lease
Explanation:
A Capital lease is known as a lease agreement in which the lessor ( someone giving out the property) agrees to transfer the ownership rights to the lessee ( someone acquiring or needing the services of the property). After completion of the agreed lease period.
In a capital lease, the lessor is usually mandated to transfer the ownership rights of the asset to the lessee upon the end of the agreed lease term between both parties.
A corporation has $7,000,000 in income after paying preferred dividends of $500,000. The company has 1,000,000 shares of common stock outstanding. The market price of the stock is $56. What is the price-earnings ratio
Answer:
Price earning ratio= 8 times
Explanation:
Price earning ratio = Price per share /Earnings per share
Price per share = 56, EPS =?
Price per share =56, EPS = Total earnings available to ordinary shareholders/Number of shares
7,000,000/1,000,000= $7 per share
Price earning ratio = 56/7= 8 times
Price earning ratio= 8 times
There are many diet aids on the market. They promise immediate weight loss without exercise or a change in diet. Each is accompanied by a testimonial from a satisfied user. If you pay close attention, you will notice that each ad also contains the statement, "Results may vary." Most likely this statement is included to prevent the Federal Trade Commission (FTC) from requiring the dietary aid distributor from having to:_______.
Answer:
run corrective advertising
Explanation:
This was likely included to prevent the Federal Trade Commission (FTC) from requiring the dietary aid distributor from having to run corrective advertising. This is a sort of punishment placed on an ad company that has made an ad with false or misleading information, in order to correct this they must add a message that is placed on their ads in order to right this wrong. This message can badly hurt the company as it advises the viewers that the company has spread false information.
One-year Treasury securities yield 4%. The market anticipates that 1-year from now 1-year Treasury securities will yield 2.1%. If the pure expectations theory is correct, what should be the yield today for 2-year Treasury securities? Write your answer as a percentage, i.e. for example write 8% as 8.
Answer:
3.05%
Explanation:
According to Pure Expectation Theory, the future short term interest rates are actually the forward rates.
Mathematically,
(1 + r2,0)^2 = (1 + r1,0)^1 * (1 + r1,1)^1
Here,
r2,0 is the rate of interest for 2 year treasury security from today
r1,0 is the rate of the interest for 1 year treasury security from today
r1,1 is the rate of the interest for 2 year treasury security from Year 1
By Putting Values, we have:
(1 + r2,0)^2 = (1 + 0.04)^1 * (1 + 0.021)^1
(1 + r2,0)^2 = 1.06184
By taking square-root on both sides, we have:
(1 + r2,0) = 1.0305
r2,0 = 3.05%
A project with an initial investment of $451,700 will generate equal annual cash flows over its 8-year life. The project has a required return of 8.9 percent. What is the minimum annual cash flow required to accept the project
Answer:
$81,307.55
Explanation:
The minimum annual cash flow required to accept the project is the equal annual cash flow that makes net present value of the project to be at least equal to zero. In other words, it is the equal annual cash flow that equates the initial investment and the summation of the present values (PV) of all the 8-year equal annual cash flow.
This can be estimated as using the formula for calculating the ordinary annuity as follows:
PV = P × [{1 - [1 ÷ (1+r)]^n} ÷ r] …………………………………. (1)
Where;
PV = Present values of equal annual cash flow that is equal to Initial investment = $451,700
P = annual cash flow = ?
r = required return = 8.9% = 0.089
n = number of years = 8
Substitute the values into equation (1) to have:
$451,700 = P × [{1 - [1 ÷ (1 + 0.089)]^8} ÷ 0.089]
$451,700 = P × 5.55544994023063
P = $451,700 / 5.55544994023063
P = $81,307.5457181148
P = $81,307.55 when approximated to two decimal places.
Therefore, the minimum annual cash flow required to accept the project is $81,307.55.
"Winston tells Lenita that he prefers to form an S corporation because he does not want to attach "LLC" to the name of the company. Lenita responds that the option of an S corporation is not available for their situation. Is she correct
Answer:
D. Yes, because all the owners are not U.S. citizens.
Explanation:
This question is not incomplete.
Please find the incomplete information below.
Winston and Noe patented a mechanism that will change open heart surgery forever. They are setting up a business to produce and sell their invention to hospitals and will take advantage of Noe's non-U.S. citizenship to help with sales in international markets. They hire Lenita, a corporate lawyer, to assist in setting up their business. Winston's largest concern is taxes. Noe, on the other hand, doesn't want to bother keeping corporate minutes and having board meetings as he is too busy. Both are concerned about being sued personally for products liability
As it is mentioned in the question that Winston and Noe wanted to set up a business for producing and selling an invention so that it would result in taking the advantage of non-U.S. citizenship so t it would help in an international market sales. For that, they hired Lenita, who is a corporate lawyer. At the same time, both the point of view is different. But they being sued for liability of products personally.
In the given scenario, Lanita is correct for the non-availability of the S corporation option as all the owners do not belong from U.S citizens.
On March 1, Bartholomew Company purchased a new stamping machine with a list price of $70,000. The company paid cash for the machine; therefore, it was allowed a 5% discount. Other costs associated with the machine were: transportation costs, $1,300; sales tax paid, $3,120; installation costs, $1,000; routine maintenance during the first month of operation, $1,200. What is the cost of the machine
Answer:
$73,120
Explanation:
Bartholomew company purchased a new stamping machine with a list price of $70,000
They were given a discount of 5%
Other costs that are associated with the machine include
Transportation costs= $1,300
Sales tax= $3,120
Installation costs= $1,000
Routine maintenance during the first month= $1,200
Then, the cost of the machine can be calculated as follows
(70,000-5/100×70,000) + $1,300+$3,120+$1,000+$1,200
$66,500+$1,300+$3,120+$1,000+$1,200
= $73,120
Hence the cost of the machine is $73,120
If annual demand is 12,000 units, the ordering cost is $6 per order, and the holding cost is $2.50 per unit per year, which of the following is the optimal order quantity using the fixed-order quantity model?
A. 421
B. 234
C. 78
D. 26
E. 312
Answer:
240 units
Explanation:
We can find Optimal order quantity easily by Optimal order quantity formula using the fixed order quantity formula
Formula:: Optimal order quantity = [tex]\sqrt[2]{\frac{2CoD}{Ch} }[/tex]
Where
Co = Ordering cost per order
D = Annual demand
Ch = Holding cost per unit
Calculations
Lets put in the values
Optimal order quantity = [tex]\sqrt[2]{\frac{2CoD}{Ch} }[/tex]
Optimal order quantity = [tex]\sqrt[2]{\frac{2*6*12000}{2.5} }[/tex]
Optimal order quantity = 240 units
Note: There must have been a mistake in question options the answer is 240 and closest to 240 is option B
Agent Jennings makes a presentation on Medicare advertised as an educational event. Agent Jennings distributes materials that are solely educational in nature. However, she gives a brief presentation that mentions plan-specific premiums. Is this a prohibited activity at an event that has been advertised as educational?
Answer:
Yes it is
Explanation:
Yes. When an event has been advertised as educational, going ahead to discuss plan-specific premiums is impermissible
The event for which Mary made the presentation is clearly an educational event so she should have concentrated fully on only educational contents that pertains to the event. Giving a presentation that mentions plan-specific premiums no matter how brief is a deviation from the main focus of the event. Therefore it is impermissible for her to do so.
As part of the initial investment, Jackson contributes accounts receivable that had a balance of $35,017 in the accounts of a sole proprietorship. Of this amount, $1,229 is deemed completely worthless. For the remaining accounts, the partnership will establish a provision for possible future uncollectible accounts of $740. The amount debited to Accounts Receivable for the new partnership is
Answer: $33788
Explanation:
From the question, we are told that as part of the initial investment, Jackson contributes accounts receivable that had a balance of $35,017 in the accounts of a sole proprietorship and of this amount, $1,229 is deemed completely worthless.
The amount that will be debited to the accounts receivable for the new partnership will be the difference between the balance of $35017 and the $1229 that is seen as been worthless.
= $35017 - $1229
= $33788
Sumner sold equipment that it uses in its business for $31,800. Sumner bought the equipment a few years ago for $79,100 and has claimed $39,550 of depreciation expense. Assuming that this is Sumner's only disposition during the year, what is the amount and character of Sumner's gain or loss
Answer:
Sumner's has a loss of $-7750 from the sale of the equipment
Explanation:
Solution
Given that:
We compute the amount of profit and loss, few steps will be taken which is given below:
Step 1: we compute the book value of the equipment which is shown below:
Book value = purchase price - depreciation claimed
= $79,100 -$39,550
= $39550
Therefore then book value is $39,550
Step 2: we calculate the amount of Sumner's gain or loss which is shown below:
The gain (loss) is = the value (sale) - book value
= $31,800 - 39550
= -7750
Therefore the loss from the sale of the equipment is -$7750
Which implies that Sumner's has a loss of $-7750
Suppose you are trying to decide whether to invest in a company that generates a high expected ROE, and you want to conduct further analysis on the company’s performance. If you wanted to conduct a comparative analysis for the current year, you would: Compare the firm’s financial ratios for the current year with its ratios in previous years Compare the firm’s financial ratios with other firms in the industry for the current year
Answer:
Compare the firm’s financial ratios with other firms in the industry for the current year
Explanation:
return on equity (ROE) = net income / stockholders' equity
it measures how profitable the company is according the amount of money that stockholders' invested in it.
Since you are trying to conduct a comparative analysis for the current year, it doesn't make sense to compare the current financial ratios with the financial ratios of previous years. If you want to compare the current year, you must compare the current financial ratios to the ratios of other companies in the same industry or the industry as a whole.
Morrow City Inc. manufactures small flash drives and is considering raising the price by 75 cents a unit for the coming year. With a 75-cent price increase, demand is expected to fall by 7,000 units. Current Projected Demand 79,000 units 72,000 units Selling price $8.50 $9.25 Incremental cost per unit $5.80 $5.80 If the price increase is implemented, operating profit is projected to ________.
Answer:
Operating profit is projected to be $35,100
Explanation:
Morrow City International
Analysis of the Current and Projected demand to determine the Operating Profit
Particulars Current Projected Changes in
Demand Demand Demand
Selling price $8.50 $9.25 0.75
Less: Cost Price $5.80 $5.80 0
Contribution $2.7 $3.45 0.75
Margin
Unit Sold 79,000 72,000 -7000
Total $213,300 $248,400 $35,100
Contribution
Note: Total contribution = Unit sold * Contribution margin
Given the following information, calculate the debt ratio percentage: Liabilities = $25,000Liquid assets = $5,000Monthly credit payments = $800Monthly savings = $760Net worth = $75,000Take-home pay = $2,300Gross income = $3,500Monthly expenses = $2,050
Answer:
33.33%
Explanation:
The debt ratio percentage is calculated as:
Liabilities / Net worth = Debt Ratio Percentage
$25,000 / $75,000 = 0.3333
0.3333 * 100 = 33.33%
The debt ratio is easy to calculate and is calculated by dividing the total liabilities of a person with the total net worth of the person. Dividing both gives a figure in decimal which is then multiplied by 100 to derive a percentage.
he following balance sheet contains errors. Mark Brock Services Co. Balance Sheet For the Year Ended December 31 Assets Liabilities Current assets: Current liabilities: Cash $7,170 Accounts receivable $10,000 Accounts payable 7,500 Accum. depr.-building 12,525 Supplies 2,590 Accum. depr.-equipment 7,340 Prepaid insurance 800 Net income 11,500 Land 24,000 Total current assets $42,060 Total liabilities $41,365 Owner’s Equity Property, plant, and equipment: Wages payable $1,500 Building $43,700 Mark Brock, capital 88,645 Equipment 29,250 Total owner’s equity 90,145 Total property, plant, and equipment 72,950 Total assets $131,510 Total liabilities and owner’s equity $131,510 Required: Prepare a corrected balance sheet. Be sure to complete the statement heading. Refer to the lists of Accounts, Labels, and Amount Descriptions for the exact wording and order of text entries. You will not need to enter colons (:) on the Balance Sheet. "Less" or "Plus" will automatically appear if it is required.
Answer:
$97,645
Explanation:
Preparation of Mark Brock Services Co corrected balance sheet :
Mark Brock Services Co. Balance Sheet December 31
Assets
Current assets:
Cash$ 7,170
Accounts receivable10,000
Supplies2,590
Prepaid insurance800
Total current assets $20,560
Property, plant, and equipment:
Land$24,000
Building$43,700
Less accumulated depreciation( 12,525)
Equipment$29,250
Less accumumulated depreciation (7,340)
Total property, plant,and equipment 77,085
Total assets (77,085+20,560) $97,645
Liabilities
Current liabilities:
Accounts payable$ 7,500
Wages payable1,500
Total liabilities$ 9,000
Owner's Equity
Capital 88,645
Total liabilities and owner's equity (88,645+9,000) $97,645
In December of 2021, XL Computer's internal auditors discovered that office equipment costing $800,000 was charged to expense in 2019. The asset had an expected life of 10 years with no residual value. XL would have recorded a half year of depreciation in 2019.
Required:
Prepare the necessary correcting entry that would be made in 2016 (ignore income taxes), and the entry to record depreciation for 2021.
Answer and Explanation:
The Journal entries are shown below:-
1. Office equipment Dr, $800,000
To Accumulated depreciation-equipment $120,000
To Retained earnings $680,000
(Being office equipment is recorded)
Here we debited the office equipment as assets is increasing and we credited the accumulated depreciation-equipment as assets is decreasing and retained earning as stockholder is increasing.
2. Depreciation expenses Dr, $80,000
To Accumulated depreciation-equipment $80,000
(Being depreciation expenses is recorded)
Here we debited the depreciation expenses as it increasing the expenses and we credited the accumulated depreciation-equipment as decreases the assets.
Working note
Depreciation
For 2019
= $800,000 ÷ 10 years
= $80,000 × 6 ÷ 12
= $40,000
For 2020
= $800,000 ÷ 10 years
= $80,000
Total = $40,000 + $80,000
= $120,000
A customer has an individual cash account, an individual margin account, a joint cash account with his wife, and a custodial account for each of his 2 children. If the firm liquidates, Securities Investor Protection Corporation covers::________
Answer and Explanation:
The Securities Investor Protection Corporation enhance security for the registered broker and distributor customers and national securities exchanges members
In the given situation, it is mentioned that a customer has 4 accounts i.e person cash account, person margin account, cash account jointly with his wife and custodial account for two children
Now if the firm liquidates, the (Securities Investor Protection Corporation) SIPC covers all accounts but separately i.e both person accounts are count as one by adding them, the joint account as an individual and the custodial account as an individual
Beamish Inc., which produces a single product, has provided the following data for its most recent month of operations: Number of units produced 3,700 Variable costs per unit: Direct materials $ 132 Direct labor $ 93 Variable manufacturing overhead $ 5 Variable selling and administrative expense $ 12 Fixed costs: Fixed manufacturing overhead $148,000 Fixed selling and administrative expense $288,600 There were no beginning or ending inventories. The absorption costing unit product cost was:
Answer:
Absorption costing unit product cost = $270 per unit
Explanation:
Absorption costing values unit produced using the full cost per unit.
It categories cost as production and non-production cost
Full cost per unit =Direct labour cost + direct material cost + Variable production overhead + fixed production overhead
Fixed prod overhead per unit = Total fixed production overhead/Number of units
= $148,000/3,700 units=$40 per unit
Full cost per unit = 132+ 93+ 5 + 40 = $270 per unit
Absorption costing unit = $270 per unit
A one-year and two-year bonds currently pays 1.2% and 1.6%, respectively. What is the expected interest rate on a one-year bond next year according to the liquidity premium theory if the two-year term premium is 0.1%
Answer: 1.8%
Explanation:
Liquidity Premium theory posits that investors prefer more liquid securities to less liquid ones.
It can also be used to calculate expected interest by relating to other bond returns.
The formula is;
Interest Rate expected in nth year = (Sum of individual interest rates in n years)/n + Liquidity Premium in nth year
The premium provided is for the two - year bond and the return on the 2 year bond is also given.
Plugging the figures in gives;
1.6% = (1.2% + One year bond expected interest) / 2 + 0.1%
1.6% - 0.1% = (1.2% + interest) / 2
1.5% * 2 = 1.2% + interest
3% = 1.2% + interest
Interest = 3% - 1.2%
Interest = 1.8%
Present Value of an Annuity of 1 Periods 8% 9% 10% 1 .926 .917 .909 2 1.783 1.759 1.736 3 2.577 2.531 2.487 A company has a minimum required rate of return of 8%. It is considering investing in a project that costs $97116 and is expected to generate cash inflows of $39000 each year for three years. The approximate internal rate of return on this project is
Answer:
9.92%
Explanation:
Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested
IRR can be calculated using a financial calculator:
Cash flow in year 0 = $-97116
Cash flow each year from year 1 to 3 = $39000
IRR = 9.92%
To find the IRR using a financial calacutor:
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 IRR button and then press the compute button.
I hope my answer helps you
A company issued 1,000 shares of $10 par value common stock due to a previously declared stock dividend; the market value at both the date of declaration and distribution was $12 per share. Which of the following correctly describes the reporting of this stock issue within the financing activities section of the cash flow statement?
a) A cash outflow of $10,000
b) A cash outflow of $2,000
c) A cash outflow of $12,000
d) There is no cash flow
Answer:
d) There is no cash flow
Explanation:
There is no cash flow because a stock dividend refers to a dividend that is paid by issuing additional shares to shareholders of a company instead of paying them a cash dividend.
Therefore, there is no cash flow since no cash is received nor paid.
Note: To record stock dividends, the amounts is moved from retained earnings to paid-in capital; and the evidence that no cash is received nor paid is that the journal entries for the issue of stock dividend will be as follows:
Debit Retained for $12,000 (i.e. 1,000 * $12 = $12,000)
Credit Common Stock for $10,000 (i.e. 1,000 - $10 = $10,000)
Credit Additional Paid-In Capital in Excess of Par - Common Stock for $2,000 ($12,000 - $10,000)
If $1200 is borrowed at 9% interest, find the amounts due at the end of 4 years if the interest is compounded as follows. (Round your answers to the nearest cent.) (i) annually $ 1693.9 Correct: Your answer is correct. (ii) quarterly $ 1204.3 Incorrect: Your answer is incorrect. (iii) monthly $ (iv) weekly $ (v) daily $ (vi) hourly $ (vii) continuously $
Answer and Explanation:
(i) The computation of compound interest for annual is shown below:-
Compound interest = A = P × (1 + r ÷ n)^t
= $1,200 × (1 + 9% ÷ 1)^1 × 4
= $1,200 × (1.09)^4
= $1,693.897932
or
= $1,693.90
(ii) The computation of compound interest for quarterly is shown below:-
= $1,200 × (1 + 9% ÷ 4)^4 × 4
= $1,200 × (1.09)^16
= $1,713.145749
or
= $1,713.15
Since it is quarterly so we divide the interest rate by 4 and multiply the time period by 4
(iii) The computation of compound interest for monthly is shown below:-
= $1,200 × (1 + 9% ÷ 12)^4 × 12
= $1,200 × (1.0075)^48
= $1,717.6864
or
= $1,717.69
Since it is monthly so we divide the interest rate by 12 and multiply the time period by 12
(iv) The computation of compound interest for weekly is shown below:-
= $1,200 × (1 + 9% ÷ 52)^4 × 52
= $1,200 × (1.432883461 )^208
= $1719.460154
or
= $1,719.46
Since it is weekly so we divide the interest rate by 52 and multiply the time period by 52
(v) The computation of compound interest for daily is shown below:-
= $1,200 × (1 + 9% ÷ 365)^4 × 365
= $1,200 × (1.43326581 )^1460
= $1719.918972
or
= $1719.92
Since it is daily so we divide the interest rate by 365 and multiply the time period by 365
(vi) The computation of compound interest for hourly is shown below:-
= $1,200 × (1 + 9% ÷ 8760)^4 × 8760
= $1,200 × (1.433326764 )^35,040
= $1,719.992117
or
= $1719.99
(vii) The computation of compound interest for continuously is shown below:-
A = Pe^rt
= 1,200e^0.09 × 4
= 1,200e^0.36
= $1,720.00
For 2018, Rest-Well Bedding uses machine-hours as the only overhead cost-allocation base. The direct cost rate is $6.00 per unit. The selling price of the product is $21.00. The estimated manufacturing overhead costs are $275,000 and estimated 40,000 machine hours. The actual manufacturing overhead costs are $350,000 and actual machine hours are 50,000. Using job costing, the 2018 actual indirect-cost rate is ________.
Answer:
Predetermined manufacturing overhead rate= $6.875 per machine-hour
Explanation:
Giving the following information:
The estimated manufacturing overhead costs are $275,000 and an estimated 40,000 machine hours.
To calculate the predetermined manufacturing overhead rate we need to use the following formula:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 275,000/40,000
Predetermined manufacturing overhead rate= $6.875 per machine-hour
Denver Co. recently used 14,000 labor hours to produce 7,500 units. According to manufacturing specifications, each unit is anticipated to take two hours to complete. The company's actual payroll costs were $158,200. If the standard labor cost per hour is $11, Denver's labor efficiency variance is: Question 18 options: $11,300 (U). $11,000 (U). $11,000 (F). $11,300 (F).
Answer:
Direct labor time (efficiency) variance= $11,000 favorable
Explanation:
Giving the following information:
Denver Co. recently used 14,000 labor hours to produce 7,500 units. According to manufacturing specifications, each unit is anticipated to take two hours to complete. The standard labor cost per hour is $11.
To calculate the direct labor efficiency variance, we need to use the following formula:
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Direct labor time (efficiency) variance= (2*7,500 - 14,000)*11
Direct labor time (efficiency) variance= $11,000 favorable
george forgot to pay his monthly life insurance premium that was due march 1. the policy had a face value of $100,000. on march 21, george died. how much will the insurer pay george's beneficiary for this death claim
Answer: An amount equal to the face value of the policy, MINUS the overdue premiums and any interest or late penalties George owed them
Explanation:
Grace Periods are usually included in Life Insurance policies to safeguard the client in question in case they are late with their payment. This means that should they pay within the grace period they will not lose their coverage.
Normally in Life Insurance, a grace period of 30 days is standard. George died 20 days after his due date which meant that he was still under a grace period and so the Insurance company will still pay out to his beneficiaries but they will deduct all monies owed by George.