Consider the following conditions for an item used in the Hess Company's manufacturing process:
On-hand inventory: 40 units
Open orders (scheduled receipts): 100 units
Backorders: 60 units
Required:
What is Hess's inventory position for this item?
Answer: 80 units.
Explanation:
Hess's inventory position for this item refers to how much inventory is on order in addition to how much inventory has been ordered. There will usually be backorders and those will need to be accounted for as well.
The Inventory Position for this item can be calculated with;
Inventory Position = Open order ( scheduled receipts) + On hand inventory - Back-orders
Inventory Position = 100 + 40 - 60
Inventory Position = 80 units.
A line of credit can be either a formal or an informal agreement between a borrower and a bank regarding the maximum amount of credit the bank will extend to the borrower during some future period, assuming the borrower maintains its financial strength.A. True
B. False
Answer:
A. True
Explanation:
The line credit is a loan in which the limit is set by the bank. It can be in formal or an informal agreement which is done between the financial institution and borrower.
In this, the time period is mentioned at which the borrower returned back the money also the borrower paid the interest to the bank it also maintained the financial position of the borrower
Hence, the given statement is true
Acme Manufacturing Corporation pays an annual dividend rate of 11.40% on its preferred stock that currently returns 15.28% and has a par value of $100.00 per share. What is the value of Acme’s preferred stock?
Answer:
The value of Acme’s preferred stock is $74.61
Explanation:
Dividend = 11.40% * $100
Dividend = $11 .40
Return =
Value of stock = Dividend / Return
Value of preferred stock = $11.40 / 15.28%
Value of preferred stock = $74.60732
Value of preferred stock = $74.61
Suppose Azerbaijan decides to increase its production of nails by 20. What is the opportunity cost of this decision
Answer: c. 5 bolts.
Explanation:
From the graph we see that the opportunity cost of making 80 nails is 20 bolts.
Opportunity cost of making 1 nail is;
80/80 : 20/80
1 : ¼
If 1 nail has an opportunity cost of ¼ bolts then making 20 extra nails would cost;
= 20 * ¼
= 5 bolts.
At the end of 2010, Blackhorse Productions, Inc., used the aging of accounts receivable method to estimate that its Allowance for Doubtful Accounts should be $19,850. The account had an unadjusted credit balance of $12,000 at that time.
Required:
Prepare journal entries for each of the following.
A. The appropriate bad debt adjustment was recorded.
B. Later, an account receivable for $1,000 was determined to be uncollectible and was written off.
Answer:
A.Dr Bad Debt Expense 7,850
Cr Allowance for Doubtful Accounts 7,850
B.Dr Allowance for Doubtful Accounts 1,000
Cr Accounts Receivable 1,000
Explanation:
Preparation of the Journal entries for Blackhorse Productions,
A.Since we were that the company used the aging of accounts receivable method to help them estimate that Allowance for Doubtful Accounts should be the amount of $19,850 in which the account had an unadjusted credit balance of the amount $12,000 this means that the transaction will be recorded as:
Dr Bad Debt Expense 7,850
Cr Allowance for Doubtful Accounts 7,850
[19,850 - 12,000]
B. Since the company later had an account receivable for the amount of $1,000 whichb was determined to be uncollectible and was written off this means that the transaction will be recorded as:
Dr Allowance for Doubtful Accounts 1,000
Cr Accounts Receivable 1,000
You want a seat on the board of directors of Red Cow, Inc. The company has 210,000 shares of stock outstanding and the stock sells for $84 per share. There are currently 4 seats up for election. The company uses straight voting. How much will it cost you to guarantee that you will be elected to the board
Answer:
It will cost $3,528,084 to guarantee that you will be elected to the board
Explanation:
We will use following formula to calculate the share to be controlled for guarantee.
Shares to be controlled = [ ( S x N ) / ( D + 1 ) ] + 1
Where
S = Numbers of shares = 210,000 shares
N = Numbers of directors to be appointed = 1
D = Total number of directors to be elected = 4
Placing values in the formula
Shares to be controlled = [ ( 210,000 x 1 ) / ( 4 + 1 ) ] + 1
Shares to be controlled = [ 210,000 / 5 ] + 1
Shares to be controlled = 42,000 shares + 1 share
Shares to be controlled = 42,001 shares
Selling Price per share = $84
Total Cost = 42,001 x $84 = $3,528,084
Which one of the following reports helps track past due bills and bills that are due shortly? Multiple Choice Accounts Payable Aging Summary Customer Aging Summary Accounts Receivable Aging Summary Vendor Aging Report
Answer:
Accounts Payable Aging Summary
Explanation:
The account payable aging summary refers to the summary of the past due bills and the bills which are due shortly. It shows the amount which we have to pay in the prescribed time limit i.e 30 days 45 days etc
Therefore the reports which is needed to track the past due bills and that are due shortly we called as the account payable aging summary
Hence, the first option is correct
Carpenters, Inc., a manufacturing company, acquired equipment on January 1, 2017 for $ 520 comma 000. Estimated useful life of the equipment was seven years and the estimated residual value was $ 20 comma 000. On January 1, 2020, after using the equipment for three years, the total estimated useful life has been revised to nine total years. Residual value remains unchanged. The company uses the straightminusline method of depreciation. Calculate depreciation expense for 2020. (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)
Answer:
Annual depreciation= $47,618
Explanation:
Giving the following information:
Purchasing price= $520,000
Useful life= 7 years
Residual value= $20,000
New useful life= 9 years
First, we need to determine the annual depreciation and accumulated depreciation before January 2020.
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (520,000 - 20,000)/7= 71,429
Accumulate depreciation= 71,429*3= $214,287
New annual depreciation:
Book value= 520,000 - 214,287= 305,713
Annual depreciation= (305,713 - 20,000) / 6
Annual depreciation= $47,618
ABC Company has the following authorized stock: Common stock: 1.00 par value, 100,000 shares On 1/11/15, ABC Company issued 10,000 shares of common stock for $5 per share (cash). How much cash does the company receive
Answer:
Amount of cash received = $50,000
Explanation:
The authorized share capital is the total maximum amount of shares in units that a company can raised as contained in its memorandum of association.
The issued share capital is the proportion of the authorized share capital that a company has decided to offer to investors to raise capital.
The total amount of issued share capital raised would be equal to
Issued share capital = units issued × price per units
= 10,000 × $5 = $50,000
Amount of cash received = $50,000
Based on the information given the amount that the company received is $50,000.
Using this formula
Cash received=Shares of common stock× Per share
Where:
Shares of common stock=10,000 shares
Per share=$5 per share
Let plug in the formula
Cash received=10,000×$5
Cash received=$50,000
Inconclusion the amount that the company received is $50,000.
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n order to run the business Economan gave up a chance to earn $110,000 in a job at the local Space Agency. In addition, he estimates that instead of investing in his business he could have put money in the bank and earned $5,000 interest. A) What is Economan’s accounting profit?
Answer: $100,000
Explanation:
His accounting profit is his Revenue less his Explicit Costs. Explicit costs are those costs that have an actual payment/ physical cash attached to them.
Accounting Profit = Revenue - Explicit Costs
= 230,000 - ( 10,000 + 100,000 + 20,000)
= 230,000 - 130,000
= $100,000
What is a mission statement?
Ann transferred land worth $200,000 with a tax basis of $40,000 to Brown Corporation, an existing entity, for 100 shares of its stock. Brown Corporation has two other shareholders, Bill and Bob, each of whom holds 100 shares. With respect to the transfer:
Answer:
Ann has a bias of $200,000 in her 100 shares in Brown Corporation.
Explanation:
The full question is as follows;
Ann transferred land worth $200,000 with a tax basis of $40,000, to Brown corporation, an existing entity, for 100 shares of its stock. Brown corporation has two other shareholders, Bill and Bob, each of whom holds 100 shares. With respect to the transfer: a. Ann has no recognized gain. b. Brown Corporation has a basis of $160,000 in the land. c. Ann has a bias of $200,000 in her 100 shares in Brown Corporation. d. Ann has a basis of $40,000 in her 100 shares in Brown Corporation. e. none of the above.
Answer
Ann has a bias of $200,000 in her 100 shares in Brown Corporation.
Explanation
From the question, we can see that Ann traded 200,000 worth of asset for 100 shares.
What this means is that the basis of her shares will be 200,000
We can also see that a capital gain of 160,000 is recognized. The capital gain is recognized because the land which was traded has a basis of 40,000 for 200,000. This makes it taxable due to the capital gain.
Hence, the land will enter Brown Corporation as 200,000 and not 160,000
Celebrate Holidays Company signed a 9%,10minusyearnote for $ 167 comma 000.The company paid an installment of $ 2 comma 400for the first month. What portion of the first monthly payment is principal? (Do not round any intermediate calculations, and round your final answer to the nearest dollar.)
Answer:
$1,147.50
Explanation:
The computation of the principal amount of first monthly payment is shown below:
As we know that
Monthly payment comprises of principal + interest
Monthly payment = interest + principal
where,
Monthly payment is $2,400
Interest would be
= $167,000 × 9% ÷ 12 months
= $1,252.50
So, the principal amount is
= $2,400 - $1,252.50
= $1,147.50
Regarding income taxes, which do you think is more important (and why)-- the average tax rate that a firm pays for the marginal tax rate the firm is paying?
Answer:
average tax rate
Explanation:
Based on these two tax rates I would say that the more important of the two is average tax rate. This is because the average tax rate is the total taxes you have paid divided by your total income. This therefore will always be less than the marginal tax rate because the this tax rate is divided by tax brackets which since the average tax rate is specific it will never reach the limit of the tax bracket making it less than the marginal tax rate.
The balance sheet provides a snapshot of the financial condition of a company. Investors and analysts use the information given on the balance sheet and other financial statements to make several interpretations regarding the company's financial condition and performance. Cute Camel Woodcraft Company is a hypothetical company. Suppose it has the following balance sheet items reported at the end of its first year of operation. For the second year, some parts are still incomplete. Use the information given to complete the balance sheet. Cute Camel Woodcraft CompanyBalance Sheet for Year Ending December 31 (Millions of Dollars) Year 2 Year 1 Year 2 Year 1 Assets Liabilities and equity Current assets: Cash and equivalents Accounts rece vable Inventories Total current assets Net fixed assets Net plant and equipment Current liabilities: $2,767 Accounts payable $0 176 996 $0 1,266 3,712 8,437 1,013 Accruals 2,970 Notes payable $6,750 Total current liabilities 937 $937 2,813 $3,750 Long-term debt 3,515 8,250 Total debt $4,687 Common equity: Common stock Retained earnings 9,141 7,313 3,937 Common stock Retained earnings Total common equity 9,141 7,313 Y 3,937 11,250 $15,000 $14,063 Total assets $18,750 15,000 Total liabilities and equity $18,750 Given the information in the preceding balance sheet-and assuming that Cute Camel Woodcraft Company has 50 million shares of common stock outstanding-read each of the following statements, then identify the selection that best interprets the information conveyed by the balance sheet.
Cute Camel's pool of relatively liquid assets, which are available to support the company's current and future sales, decreased from Year 1 to Year 2
This statement is,_________ because:
A) Cute Camel's total current asset balance actually increased from $6,750 million to $8,437 million between Year 1 and Year 2
B) Cute Camel's total current liabilities balance decreased by $1,687 mililion between Year 1 and Year 2
C) Cute Camel's total current liabilities balance increased from $1,013 million to $1,266 million between Year 1 and Year 2
Answer:
1. Year 2 Cash and Cash Equivalents = Current Assets - Accounts Receivable - Inventories
= 8,437 - 1,266 - 3,712
= $3,459
2. Year 2 Net Plant & equipment = Total assets - Total current assets
= $18,750 - 8,437
= $10,313
3. Year 2 Total current liability = Accruals + Notes Payable
= $176 + 996
= $1,172
4. Year 2 Retained earnings = Total Common Equity - Common Stock
= $14,063 - 9,141
= $4,922
5. This statement is False because:
A) Cute Camel's total current asset balance actually increased from $6,750 million to $8,437 million between Year 1 and Year 2
Current Assets are a pool of relatively liquid assets, which are available to support the company's current and future sales and they increased from Year 1 to 2.
Snapshot of balance sheet.
The balance sheet is a financial and accounting system the provides a summary of the financial conditions, that is balance of the individual and the organization. May be made for sole proprietorship or partnership.
The answer to the statement is cute carmel total C.A increased between 1 and 2 year.
The balance sheet gives us information regarding the company. Both th investors and the analyst of the cute Carmel woodcraft company use it for accessing their performance.The sheet is made for the first and the second year basis. Year 2 the Cash and Cash Equivalents = Current Assets - Accounts Receivable - Inventories. Hence equals $3,459Next the both years Net Plant & equipment = Total assets - Total current assets Thus is $10,313. Thus Total CL = Accruals + N.Payable = $1,172. A 2 Retained earnings = Total Common Equity - Common Stock = $4,922.Hence the option A is correct.
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The balance sheet and income statement shown below are for Koski Inc. Note that the firm has no amortization charges, it does not lease any assets, none of its debt must be retired during the next 5 years, and the notes payable will be rolled over.
Balance Sheet (Millions of $)
Assets 2010
Cash and securities $1,290
Accounts receivable 9,890
Inventories 13,760
Total current assets $24,940
Net plant and equipment $18,060
Total assets $43,000
Liabilities and Equity
Accounts payable $8,170
Notes payable 6,020
Accruals 4,730
Total current liabilities $18,920
Long-term bonds $8,815
Total debt $27,735
Common stock $5,805
Retained earnings 9,460
Total common equity $15,265
Total liabilities and equity $43,000
Income Statement (Millions of $) 2010
Net sales $51,600
Operating costs except depreciation 48,246
Depreciation 903
Earnings bef interest and taxes (EBIT) $2,451
Less interest 927
Earnings before taxes (EBT) $1,524
Taxes 533
Net income $990
Other data:
Shares outstanding (millions) 500.00
Common dividends (millions of $) $346.67
Int rate on notes payable & L-T bonds 6.25%
Federal plus state income tax rate 35%
Year-end stock price $23.77
____What is the firm's current ratio?
____What is the firm's quick ratio?
___ What is the firm's days sales outstanding? Assume a 365-day year for this calculation.
___What is the firm's total assets turnover?
___What is the firm's inventory turnover ratio?
___What is the firm's TIE?
___What is the firm's debt/assets ratio?
___What is the firm's ROA?
___What is the firm's ROE?
Answer:
1. Current ratio = Current Asset / Current Liability
= 24,940 / 18,920
= 1.32
2. Quick ratio = (Current Asset-inventory) / CL
= (24,940-13,760)/18,920
= 0.591
3. Days sales outstanding = (Avg AR / Sales) * 365
= 9,890/51,600 * 365
= 70.0
4. Total assets turnover = Sales/Total assets
= 51,600 / 43,000
= 1.2
5. inventory turnover ratio = Cost of Goods Sold / Average inventory
= 48,246 / 13,760
= 3.51
6. TIE = EBIT / Interest Expense
= 2,451/927
= 2.64
7. Debt/assets ratio = Total debt/Total asset
= 43,000/27,735
= 1.55
8. ROA = Net income/Total asset
= 990/43,000
= 0.0230
9. ROE = Net income/Total equity
= 990/15,265
= 0.0649
_____ involves looking at all the influences that could affect employee performance in the organization and determining their fit within organizational goals and objectives.
Answer: Organizational analysis
Explanation: Organizational analysis involves looking at all the influences that could affect employee performance in the organization and determining their fit within organizational goals and objectives.
Jewelcorp just began trading securities. The company is a closely-held corporation that is not trading stock on a national securities exchange. It has several dozen shareholders and $9 million in assets. Which of the following is true concerning the company’s requirement to report to the SEC?Not required to report information to the SEC. Required to report major business developments and must file annual and quarterly financial reports. Must file annual and quarterly financial reports Requirement to file depends on the company’s assets and shareholder base.
Answer:
Jewelcorp
Requirement to report to the SEC:
Not required to report information to the SEC.
Explanation:
Jewelcorp is not required to report information to the SEC. It is only publicly traded companies that are required to file their financial reports with the SEC.
The SEC Act of 1934 does not require private companies to file financial reports with the Security Exchange Commission. However, a private company can be required to file financial reports with SEC if it has over 500 common stockholders and $10 million in assets, which Jewelcorp does not possess.
Harvey quit his job at State University, where he earned $45,000 a year. He figures his entrepreneurial talent or forgone entrepreneurial income to be $5,000 a year. To start the business, he cashed in $100,000 in bonds that earned 10 percent interest annually to buy a software company, Extreme Gaming. In the first year, the firm sold 11,000 units of software at $75 for each unit. Of the $75 per unit, $55 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. The explicit costs of Harvey's firm in the first year were
Answer:
The explicit costs of Harvey's firm in the first year were $605,000
Explanation:
According to the given data we have the following:
In the first year, the firm sold 11,000 units of software
$55 goes for the costs of production, packaging, marketing, employee wages and benefits
Therefore, in order to calculate explicit costs of Harvey's firm in the first year we would have to make the following calculation:
explicit costs of Harvey's firm= units of software sold*costs of production, packaging, marketing, employee wages and benefits
explicit costs of Harvey's firm=11,000*$55
explicit costs of Harvey's firm=$605,000
The explicit costs of Harvey's firm in the first year were $605,000
Explain the concept of fraud in organizations as emerging ethical issues. Give example of an organization who have done fraud and being convicted.
Voltanis Corp. has preferred stock outstanding that will pay an annual dividend of $3.81 every year in perpetuity. If the stock currently sells for $98.31 per share, what is the required return
Answer:
3.9%
Explanation:
Annual dividend = $3.81
Current stock = $98.31 per share
Required return is the return on the investment which has been made by the shareholders of the company.
The Required return is calculated by the using the formula below:
Expected dividend per share divided by the Price per share
= 3.81 divided by 98.31
= 0.03875 x 100
= 3.9% after rounding up
Alden Corp. has the following balances as of December 31, 2019:Total Assets $90,000Total Liabilities 60,000Total Equity 30,000Calculate the debt to equity ratio. A. 0.64.B. 0.92.C. 1.56.D. 256.
Answer:
2.00
Explanation:
Calculation of the debt to equity ratio
Using this formula
Debt to equity ratio= Total liabilities/Total Shareholders equity
Where,
Total liabilities=60,000
Total Shareholders equity =30,000
Let plug in the formula
Debt to equity ratio=60,000/30,000
Debt to equity ratio =2.00
Therefore debt to equity ratio will be 2.00
The total value (debt plus equity) of Wilson Dover Inc. is $500 million and the face value of its 1-year coupon debt is $200 million. The volatility (σ) of Wilson Dover's total value is 0.60, and the risk-free rate is 5%. Assume that N(d1) = 0.9720 and N(d2) = 0.9050. Refer to the data for Wilson Dover Inc. What is the value (in millions) of Wilson Dover's debt if its equity is viewed as an option?
Answer:
$313.81
Explanation:
Calculation for the value (in millions) of Wilson Dover's debt if its equity is viewed as an option
Total value = P = $500.0
Debt = X = $200.0
Volatility (σ) = 0.6
rRF = 5%
d1 = 1.910485
N(d1) = 0.9720
d2= 1.310485
N(d2)=0.9050
Using this formula
Vs= PN(d1) − Xe−RFtN(d2)
Let plug in the formula
Vs= $500(0.9720) − $200e−0.05(1)(0.9050)
Vs= $485.98 − $172.17
Vs= $313.81
Therefore the value (in millions) of Wilson Dover's debt if its equity is viewed as an option will be $313.81
_____ planning is short-range, detailed planning that is based on long-range planning. It typically has a time frame that is less than one year long. Tactical Strategic Hands-on Procedural
Answer: Tactical planning
Explanation:
In tactical planning, a company's strategic plan is planned and ways are generated to achive the objectives of a company by using short-term actions.
Tactical plans are required to help teams to accomplish their goals by utilizing the steps that are clearly defined through short term outcomes and it is usually less than a year.
Chloe has her own office where she generates investment advice for companies. She is compensated for her advice. Which of the following is false?A. Chloe does not have to be a registered adviser if all of her clients are in the same state as her office.B. Chloe does have to be a registered adviser even if she only advises for one company. C. Chloe does not have to be a registered adviser if she doesn’t have authority to make investment choices for her clients. D. Chloe does have to be a registered adviser even if she only publishes informational analyses and reports concerning specific investments.
A firm pays Pam $40 per hour to assemble personal computers. Each day, Pam can assemble 4 computers if she works 1 hour, 7 computers if she works 2 hours, 9 computers if she works 3 hours, and 10 computers if she works 4 hours. Pam cannot work more than 4 hours day. Each computer consists of a motherboard, a hard drive, a case, a monitor, a keyboard, and a mouse. The total cost of these parts is $600 per computer. What is the marginal cost of producing the computers that Pam can assemble during her 2nd hour of work
Answer:
$1,840
Explanation:
In order to calculate the Marginal cost of producing the computers in 2nd hour of work, we need to add the marginal cost of computer and marginal cost of wage in the 2nd hour of work.
MC = MC(computers) + MC(wage)
MC = $1,800(w) + $40
MC = $1,840
Working
MC (computers ) = 3 x 600$ = $1,800
hour computers assembled
1st 4
2nd 7
If pam works 2 hours she can assemble 7 computers but she already assembled 4 computers in 1st hour.
So the 2nd-hour computers will be 3 ( 7 - 4) computers.
Assume that Pope Enterprises held a $10,000, 10 percent, six-month note signed by Mary Drew. On December, 1, 2015, the maturity date, Drew dishonored the note. At this point, Drew owes a total of $10,500, which is comprised of the principal of $10,000 plus interest in the amount of $500 (or $10,000 x 10% x 6/12). Prepare the December 1 entry for Pope by selecting the account names and dollar amounts from the drop-down menus. If there are multiple debits or multiple credits, please enter the account titles in alphabetical order.
Answer:
Prepare the December 1 entry for Pope:
Dr Accounts receivable 10,500
Cr Notes receivable 10,000
Cr Interest receivable 500
Since the note was dishonored, it must be turned into an account receivable. The new account receivable must include the accrued interests on the note.
Placker Corporation uses a job-order costing system with a single plantwide predetermined overhead rate based on machine-hours. The company based its predetermined overhead rate for the current year on total fixed manufacturing overhead cost of $155,000, variable manufacturing overhead of $3.40 per machine-hour, and 50,000 machine-hours. Recently, Job A881 was completed with the following characteristics: Total machine-hours 100 Direct materials $ 645 Direct labor cost $2,300 The total job cost for Job A881 is closest to:
Answer:
Total cost of job A881= $9,445
Explanation:
The total cost of Job 881 would be the sum of the direct cost and the manufacturing overhead
Total cost = Direct material + direct labour + variable manufacturing overhead + Fixed Overhead
Direct material and labour represent cost of material and labour incurred wholly and directly for Job A881
The overhead absorption rate(OAR) would be used to charge fixed manufacturing overhead to Job A881
The absorbed overhead = OAR × actual machine hours used for Job A881
OAR = budgeted overhead ÷ budgeted machine hours
OAR = $155,000 ÷ 50,000 machine hours = $3.1 per machine hour
Fixed manufacturing overhead absorbed = $3.1 × 100 = $3,100
Variable manufacturing overhead = $3.40 × 100 = $3,400
Total cost of job A881= 645 + 2,300 + 3,400 + 3,100 = $9,445
Total cost of job A881= $9,445
The demand curve of a monopolistically competitive firm is _________________ than that of a perfectly competitive firm. g
Mrs. Simpson is saving for her retirement. If she makes a payment of $1,000 at the end of each month for 15 years and earns a rate of 5.25% compounded 12 times per year, how much will she have in her retirement account when she is ready to retire
Answer:
$272,942.36
Explanation:
The formula for calculating future value = A (B / r)
B = [(1 + r) ^mn] - 1
FV = Future value
P = Present value
R = interest rate
m = number of compounding per month
N = number of years = 0,0525 /12 = 0,004375
$1,000 (1.004375)^180 - 1 / 0,004375 =$272,942.36