Answer:
Supplies Used = $2475
Explanation:
Bruce Company
Supplies Purchases $4,300
Supplies on hand $1,825
Supplies Used = $ 4300- $ 1825 = $2475
The amount of Supplies used ( $ 4300- $ 1825 = $2475) will be shown in the income statement as an expense and the amount of unused supplies or Supplies on hand $1,825 will be shown in the Balance sheet as an asset account. The both of which will total the supplies actually purchased.
The relating adjusting entry will be
Supplies Expense $ 2475 Debit
Supplies Account $ 2475 Credit
This means the supplies of the amount $ 2475 have been used and is recorded as an expense in the income statement. It will be deducted from the gross profit. The remaining amount $ 1825 is for future use so recorded as an asset in the Balance Sheet and added to the total assets.
A change in price will lead to a change in __________ and to a change in __________, while a change in government subsidies will lead to a change in __________ and a change in the number of buyers will lead to a change in __________.
Answer:
quantity demanded; quantity supplied; supply; demand
Explanation:
When there is a change in price of goods, this change will lead to quantity demanded and it will also lead to a change in the quantity supplied. According to the law of demand, an increase in price will lead to a decrease in quantity demanded and vice-versa.
When there is a change in government susidies, this change will lead to a change in supply, and a change in the number of buyers will lead to a change in demand.
Therefore, the correct statement is:
A change in price will lead to a change in quantity demanded and to a change in quantity supplied, while a change in government subsidies will lead to a change in supply and a change in the number of buyers will lead to a change in demand.
Ship Co. produces storage crates that require 34.0 meters of material at $0.20 per meter and 0.30 direct labor hours at $19.00 per hour. Overhead is applied at the rate of $16 per direct labor hour. What is the total standard cost for one unit of product that would appear on a standard cost card?
Answer:
Total standard cost = $103.7
Explanation:
Standard cost is the sum of the standard material cost , standard labour cost and standard overhead
Overhead = OAR × direct labour hour
= $16 × (0.30×$19.00)= 91.2
Standard cost = (34.0×$0.20) + (0.30×$19.00) + 91.2 = $103.7
Standard cost = $103.7
The following lots of Commodity Z were available for sale during the year. Beginning inventory 7 units at $49 First purchase 18 units at $50 Second purchase 53 units at $59 Third purchase 18 units at $64 The firm uses the periodic system, and there are 23 units of the commodity on hand at the end of the year. What is the ending inventory balance at the end of the year according to the LIFO method? a.$5,522 b.$1,447 c.$1,127 d.$1,143
Answer:
The correct answer is D.
Explanation:
Giving the following information:
Beginning inventory 7 units at $49
First purchase 18 units at $50
Second purchase 53 units at $59
Third purchase 18 units at $64
The firm uses the periodic system, and there are 23 units of the commodity on hand at the end of the year.
To calculate the ending inventory using the LIFO (las-in, first-out), we need to use the cost of the firsts units incorporated to inventory:
Ending inventory= 7*49 + 16*50= $1,143
Presented below is the adjusted trial balance of Splish Brothers, Inc. at December 31, 2017. Debit Credit Cash $ ? Supplies 1,330 Accounts Receivable 3,580 Prepaid Insurance 2,620 Equipment 80,160 Accumulated Depreciation—Equipment $20,100 Trademarks 3,760 Accounts Payable 3,220 Salaries and Wages Payable 920 Unearned Service Revenue 1,060 Bonds Payable (due 2024) 31,880 Common Stock 2,120 Additional paid-in capital 15,160 Retained Earnings 14,720 Service Revenue 30,040 Salaries and Wages Expense 14,080 Insurance Expense 2,400 Rent Expense 3,260 Interest Expense 2,320 Total $ ? $ ?
Answer:
Cash $ 5710
Total debit side $ 199200 Credit side $ 199200
Explanation:
We list the correct accounts at the right side. First we add up the credit side to find the total and then subtract the debit side from it to get the cash amount as the debit and credit side of the trial balance must be equal.
Splish Brothers, Inc.
Adjusted trial balance
December 31, 2017.
Debit Credit
Cash $ 5710
Supplies 1,330
Accounts Receivable 3,580
Prepaid Insurance 2,620
Equipment 80,160
Accumulated Depreciation—Equipment $20,100
Trademarks 3,760
Accounts Payable 3,220
Salaries and Wages Payable 920
Unearned Service Revenue 1,060
Bonds Payable (due 2024) 31,880
Common Stock 2,120
Additional paid-in capital 15,160
Retained Earnings 14,720
Service Revenue 30,040
Salaries and Wages Expense 14,080
Insurance Expense 2,400
Rent Expense 3,260
Interest Expense 2,320
Total $ 199200 $ 199200
QS 11-4 Interest-bearing note transactions LO P1 On November 7, Mura Company borrows $150,000 cash by signing a 90-day, 10%, $150,000 note payable. 1. Compute the accrued interest payable on December 31. 2. & 3. Prepare the journal entry to record the accrued interest expense at December 31 and payment of the note at maturity on
Answer: the complete question is 1. Compute the accrued interest payable on December 31. 2. & 3. Prepare the journal entry to record the accrued interest expense at December 31 and payment of the note at maturity date
Notes Payable _____
Interest Expense______
Interest Payable______
Cash ____________.
Please see explanatory column for answer.
Explanation:
To calculate accrued interest on December 31st
we use Interest = Principal x Rate x Time
where time = November 7 to December 31 = 54 days.
Interest = $150,000 x 10% x 54/360= 150,000 x 0.10 x 54/360= $2,250
Journal entry to record the accrued interest expense at December 31
Date Account Debit Credit
December 31 interest expense $2,250
Interest payable $2,250
b) To calculate payment of note at maturity date.
the borrowed cash will be paid in 90 days which means fromn November 7 of the previous year to Feb 5 of the next year = 90
using Interest = P XRX T
150,000 X 10% X 90/360= $3,750
Journal entry to record the payment of the note at maturity. which is on February 5th of the next year.
Date Account Debit Credit
February 5 Notes payable $150,000
Interest expense $1,500
Interest payable $2,250
Cash $153,750
Calculation: interest expense = $3,750- $2,250= $1500 This is because even though the total accrued interest was $3,750, only $2,250 was payable remaining $1,500 as the new interest expense for maturity date.
Moss Co. issued $780,000 of five-year, 11% bonds, with interest payable semiannually, at a market (effective) interest rate of 10%. Determine the present value of the bonds payable, using the present value tables in Exhibit 5 and Exhibit 7. Round to the nearest dollar.
Answer:
$810,113.2678
Explanation:
The computation of the present value of the bond payable is shown below:
= Issued amount × discount factor of 5% at 10 years + Issued amount × half of the bond interest × PVIFA factor of 5% at 10 years
= $780,000 × 0.613913254 + $780,000 × 5.5% × 7.7217
= $478,852.3378 + $331,260.93
= $810,113.2678
Refer to the discount factor table and PVIFA factor table
1. A company sells a plant asset that originally cost $375,000 for $125,000 on December 31, 2017. The accumulated depreciation account had a balance of $150,000 after the current year's depreciation of $37,500 had been recorded. The company should recognize a
Answer:
The company should recognize a loss on sale of plant asset of $100,00.
Explanation:
The cost = $375,000
Accumulated Depreciation = $150,000
Therefore, book value = $225,000
This book value is compared with the sales value of $125,000.
There is a difference of $100,000 ($225,000 - $125,000).
Since the book value is greater than the sales value, it means that the plant asset was sold at a loss.
The cost is the amount at which the plant asset was purchased. The accumulated depreciation represents the cost that has been expensed so far. The sales value is the amount at which the plant asset was sold.
A firm is considering a replacement project which requires the initial outlay of $300,000 which includes both an after-tax salvage from the old asset of $12,000 and an additional working capital investment of $8,000. The 12-year project is expected to generate annual incremental cash flows of $54,000 and have an expected terminal value at the end of the project of $20,000. The cost of capital is 15 percent, and the firm's marginal tax rate is 40 percent. Calculate the net present value of this project.
Answer:
-3,548.43
Explanation:
DF = Discount factor
Year Cash flow DF(15%) Present Value
0 (300,000) 1 -300,000
1 54,000 0.870 46,956.52
2 54000 0.756 40,831.76
3 54000 0.658 35,505.88
4 54,000 0.572 30,874.68
5 54000 0.497 26,847.54
6 54000 0.432 23,345.69
7 54000 0.376 20,300.06
8 54000 0.327 17,652.70
9 54000 0.284 15,350.17
10 54000 0.247 13,347.97
11 54000 0.215 11,606.93
12 74000 0. 187 13,831.13
Year 12 calculation = 54000 +20000 x 0.6 + 8000
= 74000
NPV = -300,000 + 46,956.52 + 40,831.76 + 35,505.88 + 30,874.68 + 26,847.54 + 23,345.69 + 20,300.06 + 17,652.70 + 15,350.17 + 13,347.97 + 11,606.93 + 13,831.13
NPV = -3,548.43
A company had the following purchases and sales during its first year of operations: Purchases Sales January: 10 units at $120 6 units February: 20 units at $125 5 units May: 15 units at $130 9 units September: 12 units at $135 8 units November: 10 units at $140 13 units On December 31, there were 26 units remaining in ending inventory. Using the perpetual FIFO inventory costing method, what is the cost of the ending inventory? (Assume all sales were made on the last day of the month.)
Answer:
Ending Inventory $ 3540
Explanation:
FIFO means first in first out. This rule applies to counting of the inventory in such a way that the units first purchased are sold out first. The following schedule has been prepared to arrive at the ending inventory at each date of sale .
Purchases Sales Ending Inventory
January: 10 units at $120 6 units 4 units at $120
February: 20 units at $125 5 units 19 units at $125
May: 15 units at $130 9 units 10 units at $125
15 units at $130
September: 12 units at $135 8 units 2 units at $125
15 units at $130
12 units at $135
November: 10 units at $140 13 units 4 units at $130
12 units at $135
10 units at $140
On December 31, there were 26 units remaining in ending inventory
Ending Inventory = $ 3540= $ 520 + $1620 + $1400
4 units at $130 = $ 520
12 units at $135 = $ 1620
10 units at $140= $ 1400
Darlene and her friends get together for lunch after work. While at lunch, the friends discuss what they can do to solve the problem of excessive overtime at work. Which of the following is true?
A. Darlene and her friends are not engaging in concerted activity because they don’t plan to talk to management about the problem. B. Darlene and her friends are engaging in concerted activity since they are discussing how to improve working conditions. C. Darlene and her friends are engaging in concerted activity only if they are union members. D. Darlene and her friends are not engaging in concerted activity because they are not in a union meeting.
Answer: B. Darlene and her friends are engaging in concerted activity since they are discussing how to improve working conditions.
Explanation:
Concerted Activity refers to activity that employees may engage in when they are trying to improve the conditions at their workplace without fear of Employer retaliation. Federal Law by the National Labor Relations Act protects the ability of workers to be able to meet and discuss how they can improve conditions and Employees do not even have to be in a Union to engage in such.
When engaged in a Concerted action, the employer has no right to in any way threaten your employment.
Darlene and her friends' actions are therefore considered a concerted activity as they are meeting to discuss how to improve a workplace problem.
Answer:
B. Darlene and her friends are engaging in concerted activity since they are discussing how to improve working conditions.
Explanation:
Concerted activity is defines as meeting between employees that concerns their working conditions and wages. This type of activity is protected by National Labour Relations Act, therefore it cannot be used as a basis for dismissal of an employee.
In the given scenario Darlene and her friends get together for lunch and discuss what they can do to solve the problem of excessive overtime at work.
This is a form of concerted activity on the part of Darlene and he coworkers since they are discussing working conditions.
Collins Company borrowed $1,250,000 from BankTwo on January 1, 2016 in order to expand its mining capabilities. The five-year note required annual payments of $325,545 and carried an annual interest rate of 9.5%. What is the amount of expense Collins must recognize on its 2017 income statement
Answer:
Collins Company must recognize $118,750 (which is annual interest paid on the capital) in its 2017 income statement as an expense item if the method of computing the interest is the flat rate method.
If it is reducing balance rate, then the amount deducted will equal $ 87,823
Explanation:
According to the principles of Financial Accounting, the interest portion of any loan must be entered as an expense item. The portion of the principal being paid back is recorded as part of the liability of the company in the period under consideration. It often goes by the term Loan Payable or Notes Payable.
Hence to arrive at the answers given above, you must note that the year in question is 2017 and that the loan took effect from January 2016.
When computing for interest payable, two methods may be used:
Flat rate method: which requires that the interest rate applicable is computed on the capital and multiplied by the number of years the loan will run.That is, $1,250,000 x 9.5% x 5 = Total Interest Rate Applicable.
= $593,750 so going by this method, the interest rate to be entered is
= $593, 750/5
= $118,750
2. Reducing balance rate method: This requires the rate of interest to be applied each year succesievely having taken into account the capital which way paid in the previous year.
That is, [Initial Capital-Annual Payments] *9.5%
For year 2016, annual payment will be Zero. Given that the loan started in that year. In 2017 however, the annual payment will apply as shown below:
= [$1,250,000-$325,545] *9.5%
= $924, 455 * 9.5%
= $87,823 (approximately)
Cheers!
On July 16, 2017, Logan acquires land and a building for $500,000 to use in his sole proprietorship. Of the purchase price, $400,000 is allocated to the building, and $100,000 is allocated to the land. Cost recovery of $4,708 is deducted in 2017 for the building (nonresidential real estate).a. What is the adjusted basis for the land and the building at the acquisition date?b. What is the adjusted basis for the land and the building at the end of 2017?
Answer:
A.Land $100,000
Building 400,000
B.Land $100,000
Building 395,292
Explanation:
a. Logan's adjusted basis at acquisition date will be the cost of the land and that of the building which is:
Land $100,000
Building 400,000
b. What will be Logan adjusted basis at the end of 2017 :
Land will be: $100,000
Building will be :395,292
($400,000 − $4,708)
Thus the Depreciation is a capital recovery.
Photo Framing's cost formula for its supplies cost is $1,200 per month plus $20 per frame. For the month of November, the company planned for activity of 618 frames, but the actual level of activity was 610 frames. The actual supplies cost for the month was $13,850. The spending variance for supplies cost in November would be closest to:
Answer:
Direct material spending variance= $451.4 unfavorable
Explanation:
Giving the following information:
Photo Framing's cost formula for its supplies cost is $1,200 per month plus $20 per frame.
Actual level of activity was 610 frames. The actual supplies cost for the month was $13,850.
To calculate the spending variance, we need to use the following formula:
Direct material price variance= (standard price - actual price)*actual quantity
Actual price= (13,850 - 1,200)/610= $20.74
Direct material price variance= (20 - 20.74)*610
Direct material price variance= $451.4 unfavorable
The traditional tasks performed by the HR department include all of the following except Group of answer choices labor relations. personnel administration. recruiting staff. participation in business decision making.
Human resources allude to the people who make up an organization's, business sector's, industry's, or economy's employment.
Human capital is a more specific term that refers to the knowledge and abilities that individuals possess. Manpower, employment, staff, companions, or simply: people are similar phrases.
The correct option is participation in business decision-making.
This is the correct option because this is the only one that is not the function or the tasks of the Hr department. The main function of Hr is to conduct the screening and the selection of the candidates for the interviews. The options are mentioned in the context of labor relations. personnel administration. recruiting staff, are the functions of the Hr except for the correct answer.
To know more about the functions of HR, refer to the link below:
https://brainly.com/question/17326452
Build interest in your sales message by developing your central selling points with rational, emotional, or dual appeals. Rational appeals are appropriate when a product is, for example, important to______ . Emotional appeals are appropriate when a product is, for example,________ . Whether using rational or emotional appeals, remember to translate cold facts into_______ .
1. health-appearance-egooption
2. short-lived-expensive-essentialoption
3. scare tactics related to current events-warm feelings and reader benefits -logical arguments
Answer:
1- Health
2- Essential
3- Warm feelings and reader benefits.
Explanation:
Build interest in your sales message by developing your central selling points with rational, emotional, or dual appeals. Rational appeals are appropriate when a product is, for example, important to health. Emotional appeals are appropriate when a product is, for example, essential . Whether using rational or emotional appeals, remember to translate cold facts into warm feelings and reader benefits.
For an effective marketing message, it is necessary that rational, emotional or double appeals are correctly directed to the rational and irrational thoughts that the products arouse in the consumer.
For a health product, there must be a rational appeal, as the information contained in the sales message must be real, detailed and secure.
For an essential product, it is important that there is an emotional appeal to create feelings and expectations in the customer that make him want to obtain such a product.
Whether using rational or emotional appeals, remember to translate cold facts into warm feelings and reader benefits.
Summit Systems has an equity cost of capital of 11.0 %, will pay a dividend of $1.50 in one year, and its dividends had been expected to grow by 6.0 % per year. You read in the paper that Summit Systems has revised its growth prospects and now expects its dividends to grow at a rate of 3.0 % per year forever.
A. What is the new value of a share of Summit Systems stock based on this information?
B. If you tried to sell your Summit Systems stock after reading this news, what price would you be likely to get? Why?
Answer:
A) The new value of a share of Summit Systems stock based on this information is $17.65
B) $17.65. This is due to the fact that If the information about Summit Systems has reached the capital market, the revised growth rate has already been applied.
Explanation:
Given:
Equity cost of capital = 11.0 %
Dividend in one year = $1.50
Dividends growth per year = 6.0 %
A) If expected growth rate is 6.0%:
Value of share = Expected dividend ÷ (Cost of capital - Growth rate)
Value of share = $1.50 ÷ (0.1150 - 0.060)
Value of share = $27.27
If expected growth rate is 3.0%:
New_Value of share = Expected dividend ÷ (Cost of capital - Growth rate)
New_Value of share = $1.50 ÷ (0.1150 - 0.030)
New_Value of share = $17.65
In 2019, Willow Corporation had three employees. Two of the employees worked full-time and earned salaries of $25,000 each. The third employee worked only part-time and earned $4,000. The employer timely paid state unemployment tax equal to 5.4 percent of each employee's wages up to $7,000. How much FUTA tax is due from Willow Corporation for 2019, after the credit for state unemployment taxes
Answer:
FUTA tax due from the corporation is $108
Explanation:
The First and Second employee earned 7000 each
The Third employee earn earns 4000
Paid under State Unemployment Tax by the employer is = (7000+7000+4000) x 5.40% =$972
How much FUTA tax is due from Willow Corporation for 2019?
Credit of tax paid in State Unemployment Tax is availabe for FUTA tax of 6%, thus FUTA due will be:
=(6% of 18000) - $972
=1080-972
=$108
Increased Efficiency, Inc. is looking for ways to shorten its cash conversion cycle. It has annual sales of $36,500,000, or $100,000 a day on a 365-day basis. The firm's cost of goods sold is 65% of sales. On average, the company has $9,000,000 in inventory and $8,000,000 in accounts receivable. Its CFO has proposed new policies that would result in a 20% reduction in both average inventories and accounts receivable. She also anticipates that these policies would reduce sales by 10%, while the payables deferral period would remain unchanged at 40 days. What effect would these policies have on the company's cash conversion cycle
Answer and Explanation:
The cash conversion cycle refers to the cycle which includes the days inventory outstanding and days sales outstanding and deduct the days payable outstanding
The cash cycle = Days inventory outstanding + days sale outstanding - days payable outstanding
The computation is shown in the attachment below:
As we can see in the attachment the new proposed policy i.e 234.19 days would decrease the cash conversion cycle by 24.27 days as compared with the current proposal policy i.e 258.46 days
Betsy Rose owns a small department store in a metropolitan area. For twenty years, the accountant has applied overhead to the various departments—Women's Apparel, Men's Apparel, Cosmetics, Housewares, Shoes, and Electronics—based on the basis of employee hours worked. Betsy Rose's daughter, who is an accounting student at a local university, has suggested her mother should consider using activity-based costing (ABC). In an attempt to implement ABC, Betsy Rose and her daughter have identified the following activities.
Required:
Determine a cost driver for each of the activities listed below.
a. Placing orders
b. Stocking merchandise
c. Waiting on customers
d. Janitorial and Maintenance
Answer:
Activity Cost Driver
a. Placing orders Number of Orders
b. Stocking merchandise Number of Orders
c. Waiting on customers Number of Customers
d. Janitorial and Maintenance Area/ Square feet occupied
Explanation:
Betsy Rose
(ABC). Activity Based Costing
Activity Cost Driver
a. Placing orders Number of Orders
b. Stocking merchandise Number of Orders
c. Waiting on customers Number of Customers
d. Janitorial and Maintenance Area/ Square feet occupied
In selecting a cost driver for an activity it must be kept in mind that the activity must be
1) directly linked with the cost driver
2) it should not have indirect expenses
3) should be specific for that activity.
For example the number of orders would not affect Janitorial and Maintenance services but the number of orders would affect placing orders or stocking merchandise.
Costs that do not change in total over wide ranges of volume. 2. Technique that estimates profit or loss results when conditions change. 3. The sales level at which operating income is zero. 4. Drop in sales a company can absorb without incurring an operating loss. 5. Combination of products that make up total sales. 6. Net sales revenue minus variable costs. 7. Describes how a cost changes as volume changes. 8. Costs that change in total in direct proportion to changes in volume. 9. The band of volume where total fixed costs and variable cost per unit remain constant.
Complete Question:
Match the terms with the correct definitions.
Answer:
1. Fixed costs: Costs that do not change in total over wide ranges of volume.
2. Sensitivity analysis: Technique that estimates profit or loss results when conditions change.
3. Breakeven point: The sales level at which operating income is zero.
4. Margin of safety: Drop in sales a company can absorb without incurring an operating loss.
5. Sales mix: Combination of products that make up total sales.
6. Contribution margin: Net sales revenue minus variable costs.
7. Cost behavior: Describes how a cost changes as volume changes.
8. Variable costs: Costs that change in total in direct proportion to changes in volume.
9. Relevant range: The band of volume where total fixed costs and variable cost per unit remain constant.
Explanation:
It is required that each term are matched with their respective correct definitions. The terms are generally associated with business and sales management.
For instance, fixed costs are indirect costs that do not change in total over wide ranges of volume and irrespective of the level of output (goods and services) e.g rent, salaries, property tax, insurance, depreciation etc.
Also variable costs are costs that change in total in direct proportion to changes in volume of goods and services e.g sales commission, utility costs, raw materials costs, credit card fees, direct labour costs etc.
Randolph is a 30 percent partner in the RD Partnership. On January 1, RD distributes $24,500 cash and inventory with a fair value of $23,600 (inside basis of $11,800) to Randolph in complete liquidation of his interest. RD has no liabilities at the date of the distribution. Randolph's basis in his RD Partnership interest is $39,725. What is the amount and character of Randolph's gain or loss on the distribution
Answer:
3425 LOSS
Explanation:
Randolph gain or loss can be calculated as
Gain/loss = Cash distribution + Inventory distribution - Basis in RD
Gain/loss = $24,500 + $11,800 - $39,725
Gain/loss = (3425) LOSS
As You can see RD distributing cash and inventory and they are less than his basis in RD
Included on the board of directors of Microsoft are Dina Dublon, former chief financial officer of JP Morgan Chase, the president of Harvey Mudd college Maria M. Klawe, and the vice chairman of Bank of America Charles H. Noski. These three board members do not have a direct management role with Microsoft and are therefore referred to as
A) inside directors.
B) outside directors.
C) competitive directors.
D) honorary directors.
Answer:
D) honorary directors.
Explanation:
-Inside directors are board members that are employees or stakeholders of the organization.
-Outside directors are board members that are not employees or stakeholders of the organization but receive a fee to act as consultants that can provide objective opinions.
-Competitive directors are directors of a competitive sporting event that manage the key functions.
-Honorary directors are people that has worked in the past as Chief Executive Officer of a company and are allowed to go to all the board meetings but can't vote.
According to this, the answer is that these three board members do not have a direct management role with Microsoft and are therefore referred to as outside directors as they don't have a position on the organization or are stakeholders and they are part of the board of directors to provide different perspectives.
Zappos' product selection includes performance athletic shoes, outdoor coats, contemporary shirts, couture accessories, and more. This selection best illustrates the firm's:
Answer:
Product mix breadth
Explanation:
Product mix breadth refers to varieties of products offer for sale by a store. In a product mix breadth, all products being produced by a brand or company are sold.
Although, product mix breadth comprises varieties of product line, yet it is made up of all products produced and distributed by a company. For example, a store will little space or limited finance may opt to sell fewer product lines but would also make more choices available from the product lines being sold.
On January 1, 2016, Pearson Corp has beginning inventory of 240 surfboards. Pearson estimates it will sell 400 units during the first quarter of 2016 with a 5.00% increase in unit sales each quarter. Each surfboard is sold for $200.00. How much is budgeted sales revenue for the third quarter of 2016?
Answer:
Pearson Corp
Budgeted Sales Revenue for the third quarter of 2016:
The budgeted sales revenue = $88,200 (441 x $200)
Explanation:
If First Quarter Sales = 400 units
Second Quarter Sales = 420 units (400 x 1.05)
Therefore, Third Quarter Sales = 441 units (420 x 1.05)
Another way to work it out is to compound the rate for two years:
(1.05)ⁿ = (1.05)∧2 = 1.1025
Sales in first quarter = 400 x $200 = $80,000
Sales in third quarter = $80,000 x 1.1025 = $88,200
The compounding of the rate of increase yield a compound factor that can be applied to the value of the sales in the first quarter to arrive at a sales value for the third quarter without working out the sales value for the second quarter also.
Based on the projections, Decker will have a. a financing deficit of $36 b. a financing surplus of $36 c. zero financing surplus or deficit d. a financing surplus of $255 e. a financing deficit of $255
Answer:
B, A financing surplus of $36
Explanation:
As the question is incomplete so firstly I am going to write the question for you first and its solution
Question: Decker Enterprises Below are the simplified current and projected financial statements for Decker Enterprises. All of Decker's assets are operating assets. All of Decker's current liabilities are operating liabilities. Income statement Current Projected Sales na 1,500 Costs na 1,080 Profit before tax na 420 Taxes (25%) na 105 Net income na 315 Dividends na 95 Balance sheets Current Projected Current Projected Current assets 100 115 Current liabilities 70 81 Net fixed assets 1,200 1,440 Long-term debt 300 360 Common stock 500 500 Retained earnings 430 650 Based on the projections, Decker will have
Solution :
We need to find total assets first
Current assets = 115
Net fixed assets = 1440
Total assets = 115+1440= 1555
Secondly, we need to find sum of liabilities and stockholder equities to compare them with Total assets.
Liabilities = current liabilities + long term debt
Liabilities = 81 + 360 = 441
Equity = Common stock + retained earnings
Equity = 500 + 650 = 1150
Total equity + liabilities = 1591
Financial Deficit/Surplus = Total assets - Total liabilities and stockholder equity
Financial Deficit/Surplus = 1555 - 1591
Financial Deficit/Surplus = -36 surplus
A building was purchased for $67,000. The asset has an expected useful life of eight years and depreciation expense each year is $6,000 using the straight-line method. What is the residual value of the building
Answer:
The residual value of the building is $19000
Explanation:
depreciation expense=cost-residual value/useful life
cost is $67,000
useful life is 8 years
residual value is unknown
$6000=$67,000-x/8 years
$6000* 8 years=$67,000-x
$48,000=$67,000-x
x=$67,000-$48,000$
x=$19,0000
The residual value of the asset is $19,000
Malmentier SA stock is currently priced at $85, and it does not pay dividends. The instantaneous risk-free rate of return is 5%. The instantaneous standard deviation of Malmentier SA stock is 25%. You want to purchase a put option on this stock with an exercise price of $90 and an expiration date 30 days from now. According to the Black-Scholes OPM, you should hold __________ shares of stock per 100 put options to hedge your risk.
Answer:
you should hold 76 shares of stock per 100 put options to hedge your risk.
Explanation:
Current stock price, S = $85
Risk-free rate of return, r = 5%
Standard Deviation, v = 25%
Exercise price, X = $90
expiration date, t (in years) = 30 days = 1 month = 1/12 = 0.083333 years
The option price (OP) is given by the formula:
[tex]OP = Xe^{-rt} * N(-d_{2} ) - S*N(-d_1)[/tex]
[tex]d_1 = [ln(S/X) + (r + v^{2} /2)t]/vt^{0.5}\\d_1 = [ln(85/90) + (0.05 + 0.25^{2} /2)*0.08333]/(0.25*0.08333^{0.5})\\d_1 = -0.6982[/tex]
[tex]d_2 = d_1 - (vt^{0.5})\\d_2 = -0.6982 - (0.25*0.08333^{0.5})\\d_2 = -0.7704[/tex]
Using the pro-metric calculator for the cumulative normal distribution:
N(-d1) = N(- (-0.6982)) = N(0.6982) = 0.75747
N(-d2) = N(-(-0.7704)) = N(0.7704) = 0.77947
[tex]OP = Xe^{-rt} * N(-d_{2} ) - S*N(-d_1)[/tex]
[tex]OP =[ 90e^{(-0.05*0.08333)} * 0.77947] - (85*0.75747)\\OP = 5.48[/tex]
Note that N(-d₁) = 0.76
This means that 76/100 (i.e to hedge your risk, you should hold 76 per 100 put options )
Kruger Designs hired a consulting firm 3 months ago to redesign the information system that the architects use. The architects will be able to use state of the art computer- aided design (CAD) programs to help in designing the products. Further, they will be able to store these designs on a network server where they and other architects may be able to call them back up for future designs with similar components. The consulting firm has been instructed to develop the system without disrupting the architects. In fact, top management believes that the best route is to develop the system and then to introduce it to the architects during a training session. Management does not want the architects to spend precious billable hours guessing about the new system or putting work off until the new system is working. Thus, the consultants are operating in a back room under a shroud of secrecy.
Required:
a. Do you think that management is taking the best course of action for the announcement of the new system?Why?
b. Do you approve of the development process? Why?
Explanation:
a) Yes, because management is acting in such a way that the development of the new system implemented does not cause problems or disturbances to the work of architects. Management's goal is to present architects with the new system already developed by consultants and more efficient, which can also help in resisting changes that architects could face, so management is taking the best course of action for the announcement of the new system.
b) No. Because in my opinion, for management to take the best course of action for the process of developing the new system, first the main users of the system should be advised about changes that could occur in the system due to the operation of the consultants, because the work of architects could be harmed in any way, so business decisions must be clearly communicated when it involves the progress of third party activities.
Joe has just moved to a small town with only one golf course, the Northlands Golf Club. His inverse demand function is pequals 160minus2 q, where q is the number of rounds of golf that he plays per year. The manager of the Northlands Club negotiates separately with each person who joins the club and can therefore charge individual prices. This manager has a good idea of what Joe's demand curve is and offers Joe a special deal, where Joe pays an annual membership fee and can play as many rounds as he wants at $20 , which is the marginal cost his round imposes on the Club. What membership fee would maximize profit for the Club? The manager could have charged Joe a single price per round. How much extra profit does the Club earn by using two-part pricing? The profit-maximizing membership fee (F) is $nothing . (Enter your response as a whole number.)
Answer:
Club membership fee of $60 would maximize profit.
If the club charges tow part pricing the maximum revenue can be $3500.
Explanation:
Joe has entered into a monopoly because he is owner of single golf course in the Northlands.
Demand function for Joe's golf course is:
P = 160 - 2q
P = $20 , q = 50
160 - 2 (50) = 60
Consumer surplus = 0.5 * equilibrium quantity
Consumer Surplus for Joe is ; 0.5 * 50 (160 - 20) = $3500
If MR = MC then demand function will become :
160 - 4q
If q = 25 then
160 - 4 * 25 = 60
Merit Consulting Company regularly performs services for its clients on credit but does not offer discount terms. Because the company was concerned about the credit-worthiness of a new client, that client paid $2,500 in cash at the time that the consulting services were performed. This transaction is recorded into Merit's cash receipts journal by entering __________
A. 2,500 in the Cash Dr. column
B. 2,500 in the Accounts Receivable Cr. column and 2,500 in the Other Accounts Cr. column
C. 2,500 in the Cash Dr. column and 2,500 in the Accounts Receivable Cr. column
D. 2,500 in the Cash Dr. column and 2,500 in the Other Accounts Cr. column
Answer:
Merit Consulting Company
When a client paid $2,500 in cash at the time that the consulting services were performed, the transaction is recorded into Merit's Cash Receipts Journal by entering.
A. 2,500 in the Cash Dr. column.
Explanation:
There is usually a single column for subsidiary or special journals like the Cash Receipts Journal. The journal simply accumulates the total per the period before posting this total to the controlling account.
A special journal records transactions of a particular type. Examples are Purchases, Sales, Returns Outwards and Inwards, Cash Receipts, and Cash Payment Journals.