Answer:
Falls or goes down.
Explanation:
In this scenario, we would imagine you have spent a year searching for a job and have become discouraged. Hence, in the last six (6) weeks, you have not looked for work. When numerous people are in the same situation as you, all else being equal, the unemployment rate falls or goes down.
The unemployment rate is directly proportional to the number of people seeking or looking for employment at a particular period of time. A rise in the level of unemployment is as a result of an increase in the number of people seeking employment, thus, unemployment rates rise as the number of applicants increases. Consequently, if people become discouraged from searching for a job, then the unemployment rate would fall since no applications are being submitted.
In a nutshell, a decrease in the number of people seeking employment in a country causes the unemployment rate to fall or decline and vice-versa.
What is the purpose of internal controls? Companies use strong internal controls to guarantee that loss is eliminated. Internal controls are used by managers as a way to reduce outstanding customer balances. Managers utilize internal controls as a basis of employee performance reviews. To help managers know if the business is receiving the assets and services it has paid for.
Answer:
The correct answer is: Companies use strong internal controls to guarantee that loss is eliminated.
Explanation:
The purpose of internal controls in an organization is to reduce losses.
It can be defined as the set of methods and procedures used by a company to ensure that its results are reliable, protection of the company's assets, efficiency in the allocation of resources, etc.
Effective internal control helps an organization to obtain essential information for making offensive or defensive decisions, therefore it corresponds to essential tools in the risk management process that seeks to reduce financial losses and assists in reaching the goals and objectives determined by the company's strategic planning .
S10-5 (book/static) On February 28, 2017, Rural Tech Support purchased a copy machine for $ 53 comma 400. Rural Tech Support expects the machine to last for six years and to have a residual value of $ 3 comma 000. Compute depreciation expense on the machine for the year ended December 31, 2017, using the straight-line method.
Answer:
$7,000
Explanation:
depreciation expense using straight line method = (purchase cost - salvage value) / useful life = ($53,400 - $3,000) / 6 years ) = $8,400 per year
since the machine was used for 10 months, the depreciation expense for 2017 = $8,400 x 10/12 = $7,000
the adjusting journal entry should be:
December 31, 2017, depreciation expense
Dr Depreciation expense 7,000
Cr Accumulated depreciation - copy machine 7,000
According to its 2013 10-K, how many more shares can Colgate repurchase in the future under it share repurchase program?
Answer:
The correct answer is -25,937,562
Explanation:
25,937,562 additional offers can be repurchased by Colgate later on under its offer repurchase program as indicated by its 2013 10-K. Likewise, 6,760,592 offers were repurchased by the organization.
31,905,271 offers and 30,425,271 offers were as far as possible for repurchase in the classification of Maximum Number of Shares that may yet be bought under the plans or projects however the most recent cutoff for Maximum Number of Shares that may yet be bought under the plans or projects is 25,937,562 Shares.
Thus, the correct answer is -25,937,562
Ralph, a cash basis taxpayer, owns an office building that he leases to various tenants. During 20X8, he signed a three-year lease with a tenant and received a check for $16,000 for the following:
Rent for November 1, 2008 to October 1, 2009 $5,000
Advance rent for last three months of lease 600
Security deposit (refundable) 400
For the current year, 2008, Ralph must report income of:__________
a. $6,000
b. $5,600
c. $5,000
d. $832
e. some other amount.
Answer:
b. $5,600
Explanation:
A cash basis taxpayer will report revenues and expenses when they are actually collected or paid for. The business transaction is not directly related to the moment that the payment occurs (unlike accrual accounting).
in this case, Ralph should report all the income related to monthly rental payments = $5,000 (Nov. 2008 - Oct. 2008) + $600 (the three last months of rent) = $5,600. Security deposits are not considered rental revenue, so they should not be reported as such.
Kuhn company is considering a new project that will require an initial investment of $4 million. It has a target capital structure of 58% debt, 6% preferred stock and 36% common equity. Kuhn has noncallable bonds outstanding that mature in 15 years with a face value of $1,000, an annual coupon rate of 11%, and a market price of $1,555.38. The yield on the company's current bonds is a good approximation of the yield on any new bonds that it issues. The company can sell shares of preferred stock that pay an annual dividend of $8 at a price of $92.25 per share. You can assume that Jordan does not incur any flotation costs when issuing debt and preferred stock. Kuhn does not have any retained earnings available to finance this project, so the firm will have to issue new common stock to help fund it. Its common stock is currently selling for $33.35 per share, and it is expected to pay a dividend of $2.78 at the end of next year. Flotation costs will represent 8% of the funds raised by issuing new common stock. The company is projected to grow at a constant rate of 9.2%, and they face a tax rate of 40%. What is Kuhn's WACC for this project? Please show work.
a. 7.65%
b. 9.00%
c. 10.35%
d. 9.45%
Answer:
b. 9.00%
Explanation:
For the computation of WACC first we need to follow some steps which is shown below:-
Step 1
Cost of debt = 5.48% which is explained with the help of attachment.
Given that,
Present value = $1,555.38
Future value or Face value = $1,000
PMT = 1,000 × 11% = $110
NPER = 15 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after applying the above formula, the cost of debt is
Step 2
Cost of preferred stock = Annual preferred dividend ÷ Price
= $8 × $92.25
= 0.086721
Step 3
Cost of equity = Dividend ÷ (Stock price × (1 - flotation cost)) + Growth rate
= 2.78 ÷ (33.35 × (1 - 0.08)) + 0.092
= 18.26%
WACC = Weight of debt × Cost debt) + (Weight of preference stock × Cost of preference stock) + (Weight of equity × cost of equity)
= (0.58 × (0.0548 × (1 - 0.4)) + (0.06 × 0.086721) + (0.36 × 0.1826068)
= 9.00%
Kuhn's WACC for this project will be 9.00%.
Based on the information given, the cost of preferred stock will be:
= Annual preferred dividend / Price
= $8 / $92.25
= 0.086721
Then, the cost of equity will be calculated as:
= Dividend ÷ (Stock price × (1 - flotation cost)) + Growth rate
= 2.78 ÷ (33.35 × (1 - 0.08)) + 0.092
= 18.26%
Therefore, the weighted average cost of capital (WACC) will be:
= (0.58 × (0.0548 × (1 - 0.4)) + (0.06 × 0.086721) + (0.36 × 0.1826068)
= 9.00%
Therefore, Kuhn's WACC for this project will be 9.00%.
Read related link on:
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true or false For a given labor market, an increase in the productivity (MP) of labor will shift the demand curve for labor rightward. Group of answer choices
Answer:
false
Explanation:
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Nathan's Athletic Apparel has 1,200 shares of 7%, $100 par value preferred stock the company issued at the beginning of 2020. All remaining shares are common stock. The company was not able to pay dividends in 2020, but plans to pay dividends of $18,000 in 2021. Required: 1. & 2. How much of the $18,000 dividend will be paid to preferred stockholders and how much will be paid to common stockholders in 2021, assuming the preferred stock is cumulative? What if the preferred stock were noncumulative?
Answer:
Nathan's Athletic Apparel
1. Preferred Stock Dividend = $120,000 x 7% = $8,400 for one year
For two years = $16,800 ($8,400 x 2)
Common Stock Dividend = $1,200 ($18,000 - $16,800)
2.If the preferred stock were noncumulative, the dividends would be:
Preferred Stock Dividend = $120,000 x 7% = $8,400
Common Stock Dividend = $9,600 ($18,000 - $8,400)
Explanation:
Preferred Stockholders' Equity = $120,000 (1,200 x $100)
Cumulative preferred stock is the type of preferred stock that accumulates unpaid dividends. If in any year the preferred dividend was not paid, the amount that was supposed to be paid would be carried forward to the next year when dividend is paid unlike an ordinary preferred stock that does not attract the arrears of dividend that was not paid in any given year.
Prepare journal entries to record each of the following four separate issuances of stock. A corporation issued 4,000 shares of $5 par value common stock for $35,000 cash. A corporation issued 2,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $40,000. The stock has a $1 per share stated value. A corporation issued 2,000 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $40,000. The stock has no stated value. A corporation issued 1,000 shares of $50 par value preferred stock for $60,000 cash.
Answer:
1. Dr Cash $35,000
Cr Common Stock $20,000
Cr Paid-in Capital in excess of par value Common Stock $15,000
2.Dr Organization expenses $40,000
Cr Common stock $2,000
Cr Paid-in cap in excess of stated value Common Stock $38,000
3.Dr Organization expenses $40,000
Cr Common stock, no-par value $40,000
4. Dr Cash 60,000
Cr Preferred stock 50,000
Cr Paid-in cap in excess of par value, preferred stock 10,000
Explanation:
1. Based on the information given we told that they issued 4,000 shares of $5 par value of common stock for the amount of $35,000, which means that the transaction will be recorded as:
Dr Cash $35,000
Cr Common Stock $20,000
(4,000 Shares *$ 5 Par Value)
Cr Paid-in Capital in excess of par value Common Stock $15,000
($35,000-$20,000)
2.Since they issued 2,000 shares of no-par common stock estimated to be worth the amount of $40,000. This means that the transaction will be recorded as:
Dr Organization expenses $40,000
Cr Common stock $2,000
(2,000 Shares*$1 stated value)
Cr Paid-in cap in excess of stated value Common Stock $38,000
(40,000-2,000)
3. Based on the information given we were told that they issued 2,000 shares of no-par common estimated to be worth the amount of $40,000 in which the stock has no stated value, this means that the transaction will be recorded as.
Dr Organization expenses $40,000
Cr Common stock, no-par value $40,000
4. Based on the information given we were told that they issued 1,000 shares of $50 par value preferred stock for the amount of $60,000 which means that the transaction will be recorded as:
Dr Cash 60,000
Cr Preferred stock 50,000
(1,000 Shares *$50 par value)
Cr Paid-in cap in excess of par value, preferred stock 10,000
(60,000-50,000)
A fixed asset with a cost of $52,025 and accumulated depreciation of $44,221 is traded for a similar asset priced at $55,501. Assuming a trade-in allowance of $5,664, the recognized loss on the trade is
Answer:
$2,140
Explanation:
When a commercial substance exists in the course of the exchange of an old asset for a new one , the gain or loss on this assets is recognized,
Commercial substance can be said to exist when the exchange assets impact the future cash flow. The extended useful life of the involved assets in the question the the newly acquired asset through exchange support this.
Workings
Cost of the fixed assets = 52,025
Accumulated depreciation = 44,221
Book value = 7,804
Trade in allowance = 5,664
loss = 7,804 - 5664 = 2,140
Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. For specific identification, the October 9 sale consisted of 55 units from beginning inventory and 185 units from the October 5 purchase; the October 29 sale consisted of 35 units from the October 18 purchase and 75 units from the October 25 purchase. (Round your average cost per unit to 2 decimal places.)
Answer:
Ending inventory:
(a) specific identification = $5,885
(b) weighted average = $5,960
(c) FIFO = $5,750
(d) LIFO = $5,845
Explanation:
Date Activity Units Cost Total
Oct. 1 Beg. inventory 155 $14 $2,170
Oct. 5 Purchase 180 $13.50 $2,430
Oct. 9 Sales 240
Oct. 18 Purchase 140 $13 $1,820
Oct. 29 Sales 110
Oct. 25 Purchase 330 $12.50 $4,125
total Purchases 805 $13.10 $10,545
Cost of goods sold:
(a) specific identification = [(55 x $14) + (185 x $13,50)] + [(35 x $13) + (75 x $12.50)] = $4,660
(b) weighted average = $13.10 x 350 units = $4,585
(c) FIFO = (155 x $14) + (85 x $13.50) + (95 x $13.50) + (15 x $13) = $4,795
(d) LIFO = (180 x $13.50) + (60 x $14) + (110 x $13) = $4,700
Ending inventory:
(a) specific identification = $10,545 - $4,660 = $5,885
(b) weighted average = $10,545 - $4,585 = $5,960
(c) FIFO = $10,545 - $4,795 = $5,750
(d) LIFO = $10,545 - $4,700 = $5,845
The Horstmeyer Corporation commenced operations early in 2018. A number of expenditures were made during 2018 that were debited to one account called intangible asset. A recap of the $223,000 balance in this account at the end of 2018 is as follows:
Date Transaction Amount
2/3/18 State incorporation fees and legal costs related to
organizing the corporation $ 10,000
3/1/18 Fire insurance premium for three-year period 5,000
3/15/18 Purchased a copyright 35,000
4/30/18 Research and development costs 55,000
6/15/18 Legal fees for filing a patent on a new product resulting
from an R&D project 5,000
9/30/18 Legal fee for successful defense of patent developed above 27,000
10/13/18 Entered into a 10-year franchise agreement with franchisor 55,000
Various Advertising costs 31,000
Total $ 223,000
Required: Prepare the necessary journal entry to clear the intangible asset account and to set up accounts for separate intangible assets, other types of assets, and expenses indicated by the transactions.
Answer:
Journal Entry to record various expenditure incorrectly charged to the intangible asset account
Date Account Title Debit Credit
Organisation cost expenses $10,000
Prepaid insurance $5,000
Copyright $35,000
Research and development exercise $55,000
Patent $32,000
Franchise $55,000
Advertising expenses $31,000
Intangible asset $223,000
(To record the cash expenditure)
Working note
Patent cost= Legal fee for filling a patent + Legal fee for defense
= $5,000 + $27,000
= $32,000
Schuepfer Inc. bases its selling and administrative expense budget on budgeted unit sales. The sales budget shows 2,700 units are planned to be sold in March. The variable selling and administrative expense is $3.20 per unit. The budgeted fixed selling and administrative expense is $35,770 per month, which includes depreciation of $4,200 per month. The remainder of the fixed selling and administrative expense represents current cash flows. The cash disbursements for selling and administrative expenses on the March selling and administrative expense budget should be:___________.
a. $40,210
b. $44,410
c. $31,570
Answer:
Total cash disbursement= $40,210
Explanation:
Giving the following information:
The sales budget shows 2,700 units are planned to be sold in March. The variable selling and administrative expense are $3.20 per unit.
The budgeted fixed selling and administrative expense are $35,770 per month, which includes depreciation of $4,200 per month.
The depreciation expense is not a cash disbursement.
Total cash disbursement= total variable cost + total fixed cost
Total cash disbursement= 2,700*3.2 + (35,770 - 4,200)
Total cash disbursement= $40,210
A corporation issued 6,000 shares of its $2 par value common stock in exchange for land that has a market value of $84,000. The entry to record this transaction would include:
Answer:
A debit to Land for $12,000
Explanation:
The entry to record in this transaction include a debit to Land for $12,000
Particulars Debit Credit
Land $84,000
Common stock $12,000
(6,000 * $2)
Paid in capital in excess $72,000
of par, common stock
One of the possible objectives of marketing communications is helping consumers evaluate a brand's perceived ability to meet a currently relevant need. Which of the following is a negatively oriented relevant brand need?a) normal depletionb) sensory gratificationc) social approvald) value enhacement
Answer:
) normal depletion
Explanation:
Marketing communications are the different tools employed to increases the awareness of a brand.
A brand needs to be pleasing to the eyes, socially approved and useful to customers.
Depletion is one of the negatively oriented relevant brand need.
I hope my answer helps you
Answer:
normal depletion
Explanation:
Marketing communications are the different tools employed to increases the awareness of a brand.
A brand needs to be pleasing to the eyes, socially approved and useful to customers.
Depletion is one of the negatively oriented relevant brand need.
I hope my answer helps you
Explanation:
Prepare a 2020 income statement for Shanta Corporation based on the following information:_________.
Cost of goods sold $490,000
Operating expenses 100,000
Other expenses and losses 30,000
Sales revenue 700,000
Tax rate 30%
Prepare a income statement
SHANTA CORPORATION
Income Statement
For the Year Ended December 31, 2020
The Company uses a periodic inventory system. For specific identification, ending inventory consists of 215 units, where 190 are from the January 30 purchase, 5 are from the January 20 purchase, and 20 are from beginning inventory. Determine the cost assigned to ending inventory and to cost of goods sold using (a) specific identification, (b) weighted average, (c) FIFO, and (d) LIFO.
Answer:
Ending inventory:
(a) specific identification = $2,720(b) weighted average = $2,810.05(c) FIFO = $2,687.50(d) LIFO = $3,010Cost of goods sold:
(a) specific identification = $6,495(b) weighted average = $6,404.95(c) FIFO = $6,527.50(d) LIFO = $6,205Explanation:
Date Activity Units Cost Total
Jan. 1 Beg. inventory 215 $14 $3,010
Jan. 10 Sales 165
Jan. 20 Purchase 160 $13 $2,080
Jan. 25 Sales 190
Jan. 30 Purchase 330 $12.50 $4,125
total Purchases 705 $13.07 $9,215
Ending inventory:
(a) specific identification = (190 x $12.50) + (5 x $13) + (20 x $14) = $2,720
(b) weighted average = 215 x $13.07 = $2,810.05
(c) FIFO = 215 x $12.50 = $2,687.50
(d) LIFO = 215 x $14 = $3,010
Cost of goods sold:
(a) specific identification = $9,215 - $2,720 = $6,495
(b) weighted average = $9,215 - $2,810.05 = $6,404.95
(c) FIFO = $9,215 - $2,687.50 = $6,527.50
(d) LIFO = $9,215 - $3,010 = $6,205
The Purple Martin has annual sales of $687,400, total debt of $210,000, total equity of $365,000, and a profit margin of 5.9 percent. What is the return on assets
Answer:
7.1%
Explanation:
Purple martin has an annual sales of $687,400
The total debt is $210,000
Total equity is $365,000
Profit margin is 5.9%
= 5.9/100
= 0.059
The first step is to calculate the net income
Net income= sales×profit margin
= $687,400×0.059
= $40,556.6
The next step is to calculate the total assets
Total assets= Total debt+Total equity
= $210,000+$365,000
= $575,000
Therefore, the return on assets can be calculated as follows
ROA= Net income/Total assets
= 40,556.6/575,000
= 0.0705×100
= 7.1%
Hence the return on assets is 7.1%
Which of the following statements is CORRECT?a. Ethical behavior is not influenced by training and auditing procedures. People are either ethical or they are not, and this is what determines ethical behavior in business.b. If someone deliberately understates costs and thereby causes reported profits to increase, this can cause the stock price to rise above its intrinsic value. The stock will probably fall in the future. Both those who participated in the fraud and the firm itself can be prosecuted.c. Ethics is not an important consideration in business and in business schools.d. There are many types of unethical business behavior. One example is where executives provide information that they know is incorrect to outsiders. It is illegal to provide such information to federally regulated banks, but it is not illegal to provide it to stockholders because they are the owners of the firm.e. If a lower level person in a firm does something illegal, like "cooking the books," to understate costs and thereby artificially increase profits because he or she was ordered to do so by a superior, the lower level person cannot be prosecuted but the superior can be prosecuted.
Answer: b. . If someone deliberately understates costs and thereby causes reported profits to increase, this can cause the stock price to rise above its intrinsic value. The stock will probably fall in the future. Both those who participated in the fraud and the firm itself can be prosecuted.
Explanation:
Ethics in business ad organization is very vital towards the accomplishment of goals in every organization. Ethical behavior can be influenced by training and auditing procedures.
It should be noted that when someone understates the cost intentionally maybe with the person trying to steal from the company. This can lead to the reported profits of the company to increase, and thereby cause the stock price to rise above its intrinsic value.
If eventually the stock will fall in the future, everyone who took part in this fraudulent activity and even the company itself can be prosecuted. Performing in fraudulent activities by a company or its workers will make the individuals or the company lose the trust of its clients.
Option B is the correct answer.
You purchased an airplane for $500,000 and will depreciate it using a 7-year an MACRS. Salvage value in year 4 is expected to be $250,000. The airplane is expected to increase revenues by $200,000 per year, however, O&M costs are expected to be $30,000 per year. Your company is in a 40% tax bracket and your MARR is 15%. Show the end of year cash flows for this project for years 0 through 4. What is the Net Present Worth of this investment?
Year 0_____
Year 1____
Year 2______
Year 3_____
Year 4______
NPW_____
Answer:
Year 0 = -$500,000
Year 1 = $130,580
Year 2 = $150,980
Year 3 = $136,980
Year 4 = $433,260
NPV = $65,495
Explanation:
depreciation expense per year under 7 year MACRS table:
year 1 = $500,000 x 14.29% = $71,450
year 2 = $500,000 x 24.49% = $122,450
year 3 = $500,000 x 17.49% = $87,450
year 4 = $500,000 x 12.49% = $62,450
cash flow year 1 = [($200,000 - $30,000 - $71,450) x (1 - 40%)] + $71,450 = $130,580
cash flow year 2 = [($200,000 - $30,000 - $122,450) x (1 - 40%)] + $122,450 = $150,980
cash flow year 3 = [($200,000 - $30,000 - $87,450) x (1 - 40%)] + $87,450 = $136,980
cash flow year 4 = [($200,000 - $30,000 - $62,450 + $93,800 gain on sale) x (1 - 40%)] + $62,450 + $250,000 = $433,260
MARR = 15%
using a financial calculator, NPV = $65,495
Xbox and PlayStation pay close attention to video game blogs to monitor the latest trends and popular games, because they know that video game players always want the newest games. This information helps Xbox and Playstation create new products in order to
Answer:
This question is incomplete, the options are missing. The options are the following:
a) Keep up in the market where sales come primarily from new products
b) Satisty engineering and design needs and specifications
c) Take advantage of the long product lifecycle of video games
d) Create diversification and reduce risk
e) Avoid market penetration of products that have been on the market for a long time.
And the correct answer is the option B: Satisfy engineering and design needs and specifications.
Explanation:
To begin with, the fact that those companies and others pay close attention to the video game blogs is because their managers know no just that the gamers always want the newest games but also because in that way they can know what are the current problems of the video games and what are the mistakes that need to be correct it in order to upgrade the next game and selling it by all its new features. Therefore that by doing that they try to understand the gamers needs and specifications of engineering and design of the games so in that way they would by more of the better games and the sales would increase.
A stock has an expected return of 15.0 percent, its beta is 0.90, and the risk-free rate is 5.3 percent. What must the expected return on the market be
Answer:
16.07%
Explanation:
The computation of the expected return on the market is shown below
As we know that
Expected Return on stock = Risk free return + beta ( Expected Market Rate of Return - Risk free return )
15 % = 5.3% + 0.90 × (Expected Market Rate of Return - 5.3%)
15 % - 5.3% ÷ 0.90 = Expected Market Rate of Return - 5.3%
10.77% = Expected Market Rate of Return - 5.3 %
So, expected market rate of return is
= 10.77 + 5.3%
= 16.07%
We simply applied the above formula
A recent survey of 280 small firms (with annual revenue less than $12 million) asked whether an increase in the minimum wage would cause the firm to decrease capital spending. Possible responses to the survey question were: "Yes," "No," or "Don’t Know." This data is best classified as
Answer:
nominal scale
Explanation:
nominal scale are scales that are used to assign events into discrete classifications.
Nominal scales have no order and there is no means to measure the distance between the possible responses. they are just classifications.
1. The roles of money Brian is heading out to lunch. He goes to the bank and withdraws $30 from his savings account. He heads to a local deli that sells half sub sandwiches for $4.99 and whole subs for $7.99. Brian decides that he's pretty hungry and goes for the whole. He pays with a $10 bill and tells the cashier to keep the change. Identify what role money plays in each of the following parts of the story. Hint: Select each role only once. Role of Money Medium of Exchange Unit of Account Store of Value Brian can easily determine that the whole sandwich, while twice as long as the half, is priced at less than twice as much. Brian accumulates money in his savings account for future purchases. Brian buys his lunch with a $10 bill.
Answer:
Brian can easily determine that the whole sandwich, while twice as long as the half, is priced at less than twice as much.
unit of accountBrian accumulates money in his savings account for future purchases.
Store of valueBrian buys his lunch with a $10 bill.
Medium of exchangeExplanation:
Money's four functions are:
Medium of exchange = you can use money to purchase or sells goods and services. Unit of account = money helps us to understand the relative value of goods and services, since the higher the price, the higher the value of a good or service is. Store of value = you can save money for future useStandard of deferred payment = money allows people to take or hand out loans that will be repaid in the futureLarkspur Appliance Co. manufactures low-price, no frills appliances that are in great demand for rental units. Pricing and cost information on Larkspur main products are as follows. Item Standalone Selling Price (Cost) Refrigerator $500 ($260 ) Range 570(270 ) Stackable washer/dryer unit 690(400 ) Customers can contract to purchase either individually at the stated prices or a three-item bundle with a price of $1,800.The bundle price includes delivery and installation. Larkspur also provides installation (not a separate performance obligation). Respond to the requirements related to the following independent revenue arrangements for Larkspur Appliance Co. On June 1, 2017, Larkspur sold 100 washer/dryer units without installation to Laplante Rentals for $69,000. Laplante is a newer customer and is unsure how this product will work in its older rental units. Larkspur offers a 60-day return privilege and estimates, based on prior experience with sales on this product, 4% of the units will be returned. Prepare the journal entries for the sale and related cost of goods sold on June 1, 2017. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)
Answer:
The journal entries to record the sale on June 1 are:
June 1, 2017, 100 units of washer/dryer to Laplante Rentals
Dr Cash 69,000
Cr Sales revenue 69,000
Dr Cost of goods sold 40,000
Cr Inventory 40,000
If the next question asks to record the return privilege and estimates, it should be recorded as both an asset (estimated returns inventory) and a liability (customer refunds payable).
Students arrive at the Administrative Services Office at an average of one every 15 minutes, and their requests take on average 10 minutes to be processed. The service counter is staffed by only one clerk, Judy Gumshoes, who works eight hours per day. Assume Poisson arrivals and exponential service times.
a. What percentage of time is Judy idle?
b. How much time, on average, does a student spend waiting in line?
c. How long is the (waiting) line on average?
d. What is the probability that an arriving student (just before entering the Administrative Services Office) will find at least one other student waiting in line?
Answer:
a) %idle time = 0.33
b)40.2minutes
c)40.02customers
d)0.5219
Step-by-step explanation:
It was said in the question Students arrive at the Administrative Services Office at an average of one every 15 minutes which means that
λ = 60/15= 4customers/hr
It was stated that their requests take on average 10 minutes to be processed which means that
μ = average of 10minutes = 60/10 = 6customers/hr
Then let us use these information to solve the given questions
a) percentage when judy was idle = (1- λ/μ)= 1- 0.67= 0.33
%service time = 0.67
%idle time = 0.33
b)To calculate How much time, on average that a student spend waiting in line then we make use of the formula below
= λ/ μ( μ- λ)
= 0.67hrs = 0.67 x60 = 40.2minutes
c) To calculate How long the waiting line on average;
= average waiting time x arrival rate = 0.67hrs x 6customers/hr
= 40.02customers
d) the probability that an arriving student will find at least one other student waiting in line is calculated below;
P( idle time i.e no customer to attend to) = 0.33
P1( Probability of having a customer to attend to) = 0.33 x 0.67= 0.2211
P( Probability of having 2 customer to attend to) = 0.33 x 0.67x0.67 = 0.1481
Therefore, the probability of finding at least one customer = 1 -[ po + p1]
= 1 - 0.33- 0.1481 = 0.5219
Use the following information to work the problems. Each problem stands alone.
Bernard Windows is a small company that installs windows. Its cost structure is as follows:
Selling price for each window installation $500
Variable cost of each window installation $400
Annual fixed costs $150,000
#1. This is also TRY IT 3-2 on page 75.
Calculate (a) the breakeven point in units and revenue and (b) the number of windows Bernard Windows must install and the revenues needed to earn a target operating income of $100,000.
#2. TRY IT 3-3 on page 77.
Same information as above but now tax rate is 30%. Calculate the number of windows Bernard Windows must install and the revenues needed to earn a target net income of $63,000.
#3. TRY IT 3-4 on page 82. Calculate the margin of safety in units and dollars and the margin of safety percentage if the company expects to sell 2,400 windows in the year.
#4. TRY IT 3-5 on page 84. Number of units sold is 2500.
Bernard is considering changing its sales compensation for next year. Bernard would pay salespeople a 5% commission next year and reduce fixed costs by $62,500. Calculate the degree of operating leverage at sales of 2,500 units under the two options. Comment briefly on the result.
#5. TEY IT 3-6 on page 87.
Bernard Windows plans to sell two different brands of windows-- Chad and Musk--- and budgets the following:
Chad Musk Total
Expected sales 2500 1000 3500
Revenues (500 and 350 per unit) $1,250,000 $350,000 $1,600,000
Variable cost ( 400 and 275 per unit) $1,000,000 $275,000 $1,275,000
Contribution margin (100 and 75 ) 250,000 $75,000 $325,000
Fixed costs $195,000
Operating income $130,000
Calculate the break even point for Bernard Windows in terms of the (a) number of units sold and (b) revenues.
Answer:
1.(a). Breakeven point (in units) = Fixed cost / Contribution margin per unit
Contribution margin per unit = Selling price per unit - Variable cost per unit
= 500 - 400 = 100 per unit
Breakeven point = 150,000 / 100 per unit
Breakeven point = 1500 units
Breakeven point ( in revenue) = Fixed Cost / Contribution margin ratio
Contribution margin ratio = ( Selling price per unit - Variable cost per unit) / Selling price per unit ×100
= ($500 - $400) / $500 ×100
= 20%
Breakeven point ( in revenue) = $150,000 / 20%
Breakeven point ( in revenue) = $750,000
(b). Let x be the unknown quantity of units Bernard Windows must sell to earn an operating income of $100,000. Selling price is $500
Revenue - Variable cost - Fixed cost = operating income
($500 * x) - ($400*x) - $150,000 = $100,000
($100* x) = $250,000
x = $250,000 / $100 per unit = 2,500 units
Quantity of units required to be sold = 2,500 units
Revenue to earn an operating income of $100,000 is
Revenue = Number of units required to be sold * Selling Price
Revenue = 2,500 * $500 = $1,250,000
2. Target operating income = Target net income / (1 - Tax Rate)
= $63,000 / (1 - 0.30)
= $90,000
In other words, to earn a target net income of $63,000, Bernard Windows Target operating income is $90,000.
Proof: Target operating income $90,000
Tax at 30% ( $90,000*0.30) $27,000
Target net income $63,000
Calculation of number of units Bernard Windows must sell:
Quantity of units required to be sold = Fixed cost + Target operating income / Contribution margin per unit
= $150,000 + $90,000 / $100 = $2,400 units
Quantity of units required to be sold = 2,400 units
Revenue to earn net income of $63,000 is:
Revenue = Number of units required to be sold * Selling price
= 2,400 * $500
Revenue = $1,200,000
3. Margin of Safety = Budgeted revenue - Breakeven revenue
= $1,200,000 - $750,000
Margin of Safety = $450,000
Margin of safety (in units) = Budgeted Sales (units) - Breakeven Sales (units)
= 2,400 - 1,500
Margin of safety (in units) = 900 units
The margin of safety indicated that sales would have to decrease by 900 units and revenue by $450,000 before the breakeven point is reached.
Margin of safety percentage = Margin of safety in dollars / Budgeted revenues
= $450,000 / $1,200,000 * 100 = 37.5%
This result means that revenue would have to decrease substantially, by 60%, to reach the breakeven revenues.
5. Let we assume that the budgeted sales mix (2,500 units of chad windows sold for every 1,000 units of Musk windows sold, that is a ratio of 5:2) will not change at different levels of total unit sales.
Number of units of Contribution Margin
Chad Windows and per unit for Chad Windows
Musk Windows in and Mask Windows Contribution
each bundle margin the bundle
Chad Windows 5 $100 $500
Musk windows 2 $75 $150
Total $650
To calculate breakeven point, we calculate the number of bundles Bernard needs to sell.
Breakeven point in bundles = Fixed cost / Contribution margin per bundle
= $195,000 / $650 = 300 bundles
a. Breakeven point in units of Chad Windows and Musk windows is as follows:
Chad windows: 300 bundles× 5 units per bundle = 1,500 units
Musk windows: 300 bundles ×2 units per bundle = 600 units
Total number of units to breakeven = 1,500 + 600 = 2,100 units
b. The breakeven point in dollars for Chad windows and Musk windows is as follows:
Chad windows: 1,500 units × $500 per unit = $750,000
Musk windows: 600 units ×$350 per unit = $210,000
Breakeven revenue = $750,000 + $210,000 = $960,000
George's Chemicals allocates overhead based on machine hours. Selected data for the most recent year follow. Estimated manufacturing overhead cost $235,000 Actual manufacturing overhead cost $244,200 Estimated machine hours 20,300 Actual machine hours 22,700 The estimates were made as of the beginning of the year, while the actual results were for the entire year. The predetermined manufacturing overhead rate per machine hour is closest to
Answer:
$11.58 per machine hour
Explanation:
Given that: Estimated Manufacturing overhead cost =$235,000, Actual manufacturing overhead cost = $244,200 Estimated machine hours = 20,300, Actual machine hours= 22,700
The predetermined manufacturing overhead rate per machine hour = Estimated manufacturing overhead cost / Estimated machine hours
= $235,000 / 20,300
= $11.5763
= $11.58 per machine hour
Where would it be right to apply the product concept?
Answer:
In marketing
Explanation:
The Product concept is the understanding of the best features of a product which a marketer wishes to sell. Before a product is sold, it is very important that the marketer gets a proper understanding of the product. This knowledge would help him convince the customer that the product is the best and would actually meet his needs.
For producers, realizing this need of customers would help them focus on making products with superior quality that can as well meet the requirements of customers. These products should also be able to thrive in a very competitive environment.
The monopolist should NEVER produce in the Question 10 options: range of output for which there is a price elasticity exceeding one. range of output for which the price elasticity of demand is infinity. elastic segment of its demand curve because it can increase total revenue and reduce total cost by lowering price. inelastic segment of its demand curve because further lowering of the price reduces total revenue.
Answer:
inelastic segment of its demand curve because further lowering of the price reduces total revenue
Explanation:
Monopolistic competition is a state of the industry that deals with several firms that are closely linked to each other but offer distinct goods. In fact, this market provides free entry and exit
Therefore the monopolist never produced inelastic section of the demand curve as the price should be decline that results into fall in the total revenue
Hence, the last option is correct
MC Qu. 137 Clayborn Company deposits... Clayborn Company deposits all cash receipts on the day they are received and makes all cash payments by check. At the close of business on May 31, its Cash account shows a debit balance of $24,525. Clayborn's May bank statement shows $21,800 on deposit in the bank. Determine the adjusted cash balance using the following information: Deposit in transit $ 7,450 Outstanding checks $ 6,100 Bank service fees, not yet recorded by company $ 100 A NSF check from a customer, not yet recorded by the company $ 1,275 The adjusted cash balance should be:
Answer:
The adjusted cash balance is $23,150.
Explanation:
The correct cash balance can only be verified through preparation of a bank reconciliation statement.
The first step is to update the Cash Book Bank balance as follows ;
Debits :
Balance as at May 31 $24,525
Totals $24,525
Credits:
Bank service fees $100
Dishonored Check $1,275
Balance as per updated cash book $23,150
Totals $24,525
The next step is to prepare a Bank Reconciliation Statement.
Bank Reconciliation Statement as at May 31.
Balance at bank as per the cash book (updated) $23,150
Add Unpresented cheques $ 6,100
Less Lodgements not yet credited ($ 7,450)
Balance as per bank statement $21,800
Conclusion :
The adjusted cash balance is $23,150.