Answer:
True
Explanation:
Lacy can represent both parties. If Lacy represents both parties this is known as dual agency.
As the “dual” agent Lacy handles all of the communications, paperwork, and negotiations between both parties, that is the buyer and seller who happens to be Jolene and Adam. She is supposed to remain neutral as the facilitator of the deal with no fiduciary duty to either side. Fiduciary duty is to uphold a client's interest in good faith an trust.
Six years ago, James Corporation sold a $100 million bond issue to expand its facilities. Each debenture has a $1,000 par value, an original maturity of 20 years (there are now 14 years left to maturity), and an annual coupon rate of 11.5% with semiannual payments. If you require a 14% return, what price would you pay today for a James bond?
Answer:
Price of Bonds=$848.286
Explanation:
The value of the bond is the present value (PV) of the future cash receipts expected from the bond. The value is equal to present values of interest payment plus the redemption value (RV) discounted at the yield rate
Value of Bond = PV of interest + PV of RV
The value of bond for James Corporation can be worked out as follows:
Step 1
PV of interest payments
PV = A × (1+r)^(-n)/r
A- semiannual interest payment, n-number of periods, r- semi annul yield
A-semi- annul interest payment:
=11.5%× 1,000× 1/2 = 75
r-semi-Annual yield = 14%/2 = 7%
n-Maturity period =1 4 × 2= 28
PV of interest payment:
=57.5 × (1- (1+0.07)^(-28)/0.07)
= 697.88
Step 2
PV of Redemption Value
= 1,000 × (1.07)^(-28) = 150.40
Step 3
Price of bond
=697.88 + 150.40
=$848.286
Using both the supply and demand for bonds and liquidity preference framework, show how interest rate are affected when the riskiness of bonds rises. Are the results the same in the two frame works
Answer:
Yes, the results are the same in both frameworks. Please see below for explanation.
Explanation:
With regards to the bond supply and demand framework, people will look to buy more bonds since they are more wealthy now. Hence, the supply of bonds will increase. The supply curve and the demand curve will both move to the right, with the former shifting more than the latter. The equilibrium interest rate will increase.
With regards to the liquidity preference framework, once the economy experiences a positive shift, there will also be an increase in the demand for money. People will make an increased number of transactions as well and hence, the demand curve will move towards the right. The equilibrium interest rate will rise too.
Rogers Inc. has provided the following data for the month of June. There were no beginning inventories; consequently, the direct materials, direct labor, and manufacturing overhead applied listed below are all for the current month.
Work in process Finished goods Cost of goods sold Total
Direct materials $2,380 16790 43930 $63,100
Direct labor 1710 16060 42020 $59,790
Manufacturing overhead applied 1520 9880 26600 $38,000
Total $5,610 $42,730 $112,550 $160,890
Manufacturing overhead for the month was underapplied by $1,000. The company allocates any underapplied or overapplied manufacturing overhead among work in process, finished goods, and cost of goods sold at the end of the month on the basis of the overhead applied during the month in those accounts. The work in process inventory at the end of June after allocation of any underapplied or overapplied manufacturing overhead for the month is closest to:
a. $5,570
b. $5,575
c. $5,645
d.$5,650
Answer:
d.$5,650
Explanation:
Rogers Inc.
Work in process Finished goods Cost of goods sold Total
Direct materials $2,380 16790 43930 $63,100
Direct labor 1710 16060 42020 $59,790
Manufacturing overhead
Applied 1520 9880 26600 $38,000
% OF OH Applied 1520/38000 9880/38000 26600 /38000
4% 26% 70%
Total $5,610 $42,730 $112,550 $160,890
Under applied 4% of 1000 26% of 1000 70% of 1000
Under applied 40 260 700
Total $ 5650 42990 113250
We find the percentage of the manufacturing overhead applied and multiply it with the under applied amount. Then we add the underapplied amount to the total to get the actual amount.
There is often litter along highways but rarely in people's yards. Which of the following statements help explain this observation?
a. Littering on the highway generates a positive externality.
b. The private cost of littering on the highway is low.
c. The private cost of littering on your own yard exceeds the social cost.
Answer:
The answer is A and C
Explanation:
Solution
Social costs refers to the total cost of an activity incurred by society.
Private costs are direct costs incurred by an individual
Frequently there is liter along the high ways but rarely in people's yards because the social cost of littering is more than private cost. since the society must bear the negative externality, the social cost is more and the private cost is less.
The private cost is higher when one liters on his own yard as the cost is only borne or carried by the owner and not the society.
Question 16 (3 points) The 2011 and 2012 Balance Sheets for Jacob, Inc. contained the following entries: 12/31/201112/31/2012 Accounts receivable$206$116 Inventories$590$603 Net fixed assets$102$307 Accounts payable$329$333 Jacob had materials purchases in 2011 of $1,689 and materials purchases in 2012 of $2,770 . What did Jacob record as Cost of Goods Sold (COGS) on its 2012 income statement
Answer:
$2,857
Explanation:
Cost of goods sold (COGS) refers to the relevant cost incurred to acquire or produce the products being sold a company during a particular period.
The formula for calculating the COGS is as follows:
COGS = Beginning inventories + Purchases - Ending inventories
From the question, we have the following for 2012:
Beginning stock = $590
Purchases = $2,770
Ending inventory = 503
Therefore, we have:
COGS for 2012 = $590 + $2,770 - $503 = $2,857
Therefore, Jacob should record $2,857 as Cost of Goods Sold (COGS) on its 2012 income statement.
The government establishes an effective price ceiling for a gallon of milk. What will be the result of this ceiling? a) It will create a surplus b) It will create a shortage c) It will have no effect d) It will cause an increase in demand e) it will cause an increase in supply
Answer:
D
Explanation:
Because price ceiling is put by the government so that certain commodities could still be available at a reasonable price for many
Answer: D
Explanation:
Daniel acquires a 30 percent interest in the PPZ Partnership from Paolo, an existing partner, for $48,000 of cash. The PPZ Partnership has borrowed $19,000 of recourse liabilities as of the date Daniel bought the interest. What is Daniel's basis in his partnership interest
Depreciation associated with a project will: Answer A. cause incremental cash flows to increase B. only affect the fixed asset account as depreciation is a sunk cost C. have no effect on incremental cash flows D. cause incremental operating cash flows to decrease
Answer: A. cause incremental cash flows to increase
Explanation:
Incremental Cashflow (ICF) is the added cash that a company gets from embarking on a project which means that this Cashflow must be independent of expenses. If ICF is positive then the company will see it's Cashflow increase if they accept the project because it will contribute to their cash flow.
ICF is calculated from the Net Income of the project but seeing as Depreciation is a non-cash expense that is removed from the Income Statement. In calculating ICF it is added back as ICF deals with actual cash and Depreciation did not cost any actual cash.
More Depreciation therefore means an increase in Incremental Cash flow when it is being calculated from Net Income.
Your uncle lends you $2,000 less $100 (interest at 5 percent), and you receive $1,900. Use the APR formula to find the true annual percentage rate. Assume you repay the entire loan in one year
Answer:
APR =5.263%
Explanation:
Computation of the true annual percentage rate
Using the APR formula to find the true annual percentage rate
APR=(2 × n × I) / [P × (N + 1)]
Hence;
APR= (2 × 1 × $100) / [$1,900 × (1 + 1)]
APR=$200/($1,900×2)
APR=$200/$3,800
APR= 0.05263 ×100
APR =5.263%
Therefore the true annual percentage rate using the APR formula will be 5.263%
The duration of copyright protection for works not made for hire is: Select one: a. 20 years from the date of filing. b. Generally perpetually as long as the works are in print. c. One year if no registration has been f
Answer:
Life of the author plus 70 years
Explanation:
Copyright can be defined as the legal ways of protecting an author's work. It is a type of intellectual property right that protect authors from unauthorized individuals from publishing their work.
It is the right to copy given by an author to anyone to copy their work. Content that can be protected by copyright includes; books, poems, plays, songs, films, and artwork and website.
Kansas Company acquired a building valued at $151,000 for property tax purposes in exchange for 12,000 shares of its $3 par common stock. The stock is widely traded and selling for $18 per share. At what amount should the building be recorded by Kansas Company
Answer:
The building would be recorded by Kansas Company for an amount of $216,000
Explanation:
In order to calculate the amount should the building be recorded by Kansas Company we would have to calculate the value of the building with the following formula:
value of the building= shares exchanged*Market value per share
shares exchanged=12,000 shares
Market value per share=$18
Therefore, value of the building=12,000*$18
value of the building=$216,000
The building would be recorded by Kansas Company for an amount of $216,000
For each of the following situations involving annuitities solve for the unknown assume that interest is compounded annually and that all annuity amounts are received at the end of each period. (i = interest rate, and n = number of years) (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1).
Present Value Annuity Amount i = n =
3000 8% 5
242980 75000 4
161214 20000 9%
500000 80518 8
250000 10% 4
Answer:
A) $11,978.10
B) 9%
C) 15 years
D) 6%
E) $78,866.84
Explanation:
Present Value Annuity Amount i = n =
A 3000 8% 5
242980 75000 B 4
161214 20000 9% C
500000 80518 D 8
250000 E 10% 4
A = $3,000 x 3.9927 = $11,978.10
B: annuity factor = $242,980 / $75,000 = 3.23973
using the annuity table, a 9% annuity for 4 years has a factor = 3.2397
C: annuity factor = $161,214 / $20,000 = 8.0607
using the annuity table, a 9% annuity for 15 years has a factor = 8.0607
D: annuity factor = $500,000 / $80,518 = 6.20979
using the annuity table, a 6% annuity for 8 years has a factor = 6.2098
E: annuity payment = present value / annuity factor = $250,000 / 3.1699 (annuity factor 10%, 4 years) = $78,866.84
Review the "Types of Distribution Channels" study material. Explain why the selection of distribution channels is essential to a successful marketing strategy. Provide an example of a well-known company's distribution channels and defend their choices. In replies to peers, agree or disagree with their assessment and justify your response.
The correct answer to this open question is the following.
Although the question does not provide a specific text, we can say that the selection of distribution channels is essential to a successful marketing strategy because that is how companies deliver their products to consumers. This is of key importance due to the fact that there are numerous competitors selling the same or similar products so the company has to be precise and effective in delivering the product to match the client's expectations.
One good example of a successful company would be Underarmour. This Maryland company sells its products through direct distribution, uses intermediaries and brokers, has open many outlets where the company sells direct to the consumer, and also sells products through e-commerce portals. You can find Underarmour apparel in big chain stores, fashion stores, the internet, and sports stores.
A company is considering constructing a plant to manufacture a proposed new product. The land costs $300,000, the building costs $600,000, the equipment costs $250,000, and $100,000 additional working capital is required. It is expected that the product will result in sales of $750,000 per year for 10 years, at which time the land can be sold for $400,000, the building for $350,000, and the equipment for $50,000. All of the working capital would be recovered at the EOY 10. The annual expenses for labor, materials, and all other items are estimated to total $475,000. If the company requires a MARR of 15% per year on projects of comparable risk, determine if it should invest in the new product line. Use the AW method. (Sullivan, 20180327, p. 234) Sullivan, W. G., Wicks, E. M., Koelling, C. P. (20180327). Engineering Economy, 17th Edition. [[VitalSource Bookshelf version]]. Retrieved from vbk://9780134838229 Always check citation for accuracy before use.
Answer:
$327,909.14
Explanation:
Calculation to determine if it should invest in the new product line.
First step
The Investment cost will be:
Land costs $300,000
Building costs $600,000
Equipment costs $250,000
Additional working capital $100,000
=$1,250,000
Annual revenue $750,000
Annual expenses$475,000
Market value:
$400,000 +$350,000 + $50,000 = $80,0000
N: 10 year
MARR: 15% per year
Using PW method
-$1250000 + ($750,000 – $475,000) (P/A, 15%, 10) +$ 80000(P/F, 15%, 10)
-$1250000-$275,000((1+15)^¹⁰−1/15(1+15)^¹⁰+$3000
Hence,
=-$1,250,000 – $275,000(5.0188) + $3000(0.2472)
= $327,909.14
Brooke Hubert works for MRK all year and earns a monthly salary of $ 11 comma 900. There is no overtime pay. Brooke's income tax withholding rate is 10 % of gross pay. In addition to payroll taxes, Brooke elects to contribute 5 % monthly to United Way. MRK also deducts $ 125 monthly for co-payment of the health insurance premium. As of September 30, Brooke had $ 107 comma 100 of cumulative earnings. LOADING...(Click the icon to view payroll tax rate information.) Requirements 1. Compute Brooke's net pay for October. 2. Journalize the accrual of salaries expense and the payments related to the employment of Brooke Hubert.
Answer:
1. Compute Brooke's net pay for October
Brooke's gross monthly salary = $11,900
- federal income taxes withholdings = ($1,190)
- contribution to United Way = ($595)
- health insurance = ($125)
- social security = 6.2% x $11,900 = ($737.80)
- medicare = 1.45% x $11,900 = ($172.55)
net pay = $9,079.65
2. Journalize the accrual of salaries expense and the payments related to the employment of Brooke Hubert.
We must include here FUTA taxes paid by the employer. In this case, since we are not given the state unemployment (SUTA) tax rate, we can only calculate the federal unemployment tax 6% x $11,900 = $714. Both the employee and employer pays FICA taxes in an equal amount. The amount that is withheld from the employee's paycheck is identified as FICA tax withholding.
October 31, 202x
Dr Wages expense 11,900
Dr FICA taxes expense 910.35
Dr FUTA taxes expense 714
Cr Federal income tax withholding payable 1,190
Cr FICA tax (social security) withholding payable 737.80
Cr FICA tax (social security) payable 737.80
Cr FICA tax (medicare) withholding payable 172.55
Cr FICA tax (medicare) payable 172.55
Cr FUTA tax payable 714
Cr Health insurance payable 125
Cr United Way payable 595
Cr Wages payable 9,079.65
Suddeth Corporation has entered into a 6 year lease for a building it will use as a warehouse. The annual payment under the lease will be $2,468. The first payment will be at the end of the current year and all subsequent payments will be made at year-ends. If the discount rate is 5%, the present value of the lease payments is closest to (Ignore income taxes.):
Answer:
$13,153.15
Explanation:
Present value is the sum of discounted cash flows.
Present value can be calculated using a financial calculator
Cash flow each year from year 0 to 5 = $2,468
I = 5%
PV = $13,153.15
To find the PV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
Production estimates for July are as follows:
Estimated inventory (units), July 1 725
Desired inventory (units), July 31 1, 200
Expected sales volume (units), July 7,500
For each unit produced four hours of direct labor is required. The labor rate per hour is $15. The number of direct labor hours required for July production is:_________
Answer:
31,900
Explanation:
For the computation of the number of direct labor hours required for July production first we need to find out the production in units which is shown below:-
Production in units = Expected sales in Units + Ending Inventory - Beginning inventory
= 7,500 + 1,200 - 725
= 7,975
Total direct labor hours required = Production in units × Hours per unit
= 7,975 × 4
= 31,900
We simply applied the above formulas
Prepare a multiple-step income statement through the calculation of gross profit.
For each transaction, indicate the impact each item had on income and the dollar amount of the change in income, if any. Input decreases to net income as negative values. Upon completion, compare the gross profit with the amount reported on the partial income statement.
Jul. 1 Purchased merchandise from Boden Company for $6,000 under credit terms of 1/15, n/30,
FOB shipping point, invoice dated July 1.
Jul. 2 Sold merchandise to Creek Co. for $900 under credit terms of 2/10, n/60, FOB shipping point,
invoice dated July 2. The merchandise had cost $500.
Jul. 3 Paid $125 cash for freight charges on the purchase of July 1.
Jul. 8 Sold merchandise that had cost $1,300 for $1,700 cash.
Jul. 9 Purchased merchandise from Leight Co. for $2,200 under credit terms of 2/15, n/60, FOB
destination, invoice dated July 9.
Jul. 11 Received a $200 credit memorandum from Leight Co. for the return of part of the merchandise
purchased on July 9.
Jul. 12 Received the balance due from Creek Co. for the invoice dated July 2, net of the discount.
Jul. 16 Paid the balance due to Boden Company within the discount period.
Jul. 19 Sold merchandise that cost $800 to Art Co. for $1,200 under credit terms of 2/15, n/60, FOB
shipping point, invoice dated July 19.
Jul. 21 Issued a $200 credit memorandum to Art Co. for an allowance on goods sold on July 19.
Jul. 24 Paid Leight Co. the balance due after deducting the discount.
Jul. 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount.
Jul. 31 Sold merchandise that cost $4,800 to Creek Co. for $7,000 under credit terms of 2/10, n/60,
FOB shipping point, invoice dated July 31.
Answer:
inventory 6,000 debit
account payable 6,000 credit
--to record July 1st--
Acc Rec 900 debit
Sales Revenues 900 credit (+900 income)
--to record sale--
COGS 500 debit (-500 expense)
Inventory 500 credit
--to record cost of sale--
Delivery expense 125 debit (-125 expense)
Cash 125 credit
--to record freight-out --
Cash 1,700 debit
Sales Revenues 1,700 credit (+1,700 income)
--to record sale--
COGS 1,300 debit (-1,300 expense)
Inventory 1,300 credit
--to record cost of sale--
Inventory 2,200 debit
Account Payable 2,200 credit
--to record purchase--
Account Payable 200 debit
Inventory 200 credit
--to record return of goods--
Cash 882 debit
Sales DIscount 18 debit
Accounts Receivables 900 credit
--to record payment from customer--
Account Payable 6,000 debit
Cash 5,940 credit
Inventory 60 credit
--to record payment to supplier--
Cash 1,200 debit
Sales Revenues 1,200 credit (+1,200 income)
--to record sale--
COGS 800 debit (-800 expense)
Inventory 800 credit
--to record cost of sale--
Sales Returns 200 debit
Account Receivables 200 credit
-- to record return from customer--
Account Payable 2,000 debit
Cash 1,960 credit
Inventory 40 credit
--to record payment to supplier--
Cash 980 debit
Sales DIscount 20 debit
Accounts Receivables 1,000 credit
--to record payment from customer--
Cash 7,000 debit
Sales Revenues 7,000 credit (+7,000 income)
--to record sale--
COGS 4,800 debit (-4,800 expense)
Inventory 4,800 credit
--to record cost of sale--
Explanation:
Cheek
900 x 2% = 18
net of discount 900 - 18 = 882
Boden:
6,000 x 1% = 60
Net of discount 6,000 - 60 = 5,940
Leight:
2,200 - 2,000 = 2,000 balance due
2,000 x 2% = 40
net of discount 1,960
Art Co:
1,200 - 200 = 1,000 balance due
1,000 x 2% = 20 discount
net = 1,000 - 20 = 980
According to the Phillips curve, policymakers could reduce both the inflation rate and the unemployment rate by Group of answer choices increasing the money supply. raising taxes. increasing government expenditures None of the other answers is correct
Answer:
None of the other answers is correct.
Explanation:
Williams A. Phillips was a notable economist born in New Zealand. Phillips wrote a famous article titled "The Relation between Unemployment and the Rate of Change of Money Wage Rates in the United Kingdom, 1861-1957" published in 1958 by Economica. In the article, he used data for the United Kingdom (U.K) to illustrate on a graph, a negative or inverse relationship between the rate of change of employee wages in the U.K and the unemployment rate in the United Kingdom (U.K).
Consequently, using the Phillips curve it is practically impossible for policymakers to reduce both the inflation rate and the unemployment rate because as the inflation rate decreases; the unemployment rate increases and vice-versa.
However, according to the Phillips curve, policymakers can reduce inflation and increase unemployment if aggregate demand is contracted.
A company received a bank statement showing a balance of $78,000. Reconciling items included outstanding checks of $2,400 and a deposit in transit of $9,400. What is the company's adjusted bank balance
Answer:
Adjusted Bank Balance = $85,000
Explanation:
Adjustment of bank balance is a bank reconciliation procedure, that is used to match the amount in the bank statement with the amount in the company's balance sheet.
To adjust the bank balance, particulars that need to be subtracted or added to the bank statement balance has to be identified and treated accordingly.
For this example, the adjusted balance is calculated thus:
Adjusted bank balance = (Bank statement balance) - (outstanding checks) +(deposit in transit)
Adjusted Bank Balance = 78,000 - 2,400 + 9,400 = $85,000
Note:
outstanding checks are subtracted because they are payments to be made made by the company, representing a liability to the company (payer)
deposit in transit is an income to the company that has not been credited yet, but that will be credited.
All projects are unique:________.
Select one:
A. Therefore all project management circumstances are equally unique.
B. So knowledge should not be transferred to avoid bias in future projects.
C. So knowledge cannot be transferred.
D. But they may have several common points.
Answer:
D. But they may have several common points
Explanation:
Although all projects are unique, they still share similar similarities. So knowledge can be transferred.
Which of the following statements is most correct? a. All else equal, if a bond’s yield to maturity increases, its price will fall. b. All else equal, if a bond is down graded by the rating agencies its yield to maturity will increase. c. If a firm has two bond issues that are identical except one is subordinate to the other, the subordinate issue will have a higher yield to maturity than the other issue. d. A B and C are correct. e. None of the above are correct
Answer: d. A B and C are correct.
Explanation:
A bond's price and it's Yield to Maturity (YTM) are inversely related such that when Yield to Maturity rises, the price of the bond falls. This is a because a higher YTM signifies that the bond is riskier so it will compensate by being cheaper.
If a bond is downgraded by Ratings agencies then it means that the bond is now riskier. As it is riskier investors will charge more interest for taking on the risk. The interest is the YTM and so it rises.
A Subordinate bond means that if the company were to go into bankruptcy for instance, the Subordinate bond would only be paid for after the bond that is not Subordinated. This means that there is a chance that Subordinate bond holders will not get anything from the liquidation of the company. Investors will therefore charge a higher YTM to cater for the risk that this happens.
Jayne Butterfield, a single mother with three children, lived in Sacramento, California. Sarah Huckleberry also lived in California until she moved to New York City to open and operate an art gallery. Huckleberry asked Butterfield to manage the gallery under a one-year contract for an annual salary of $90,000. To begin work, Butterfield relocated to New York. As part of the move, Butterfield transferred custody of her children to her husband, who lived in London, England. In accepting the job, Butterfield also forfeited her husband's alimony and child-support payments, including unpaid amounts of nearly $45,000. Before Butterfield started work, Huckleberry repudiated the contract. Unable to find employment for more than an annual salary of $30,000, Butterfield moved to London to be near her children. She filed a suit in an California state court against Huckleberry, seeking damages for breach of contract. Should the court hold, as Huckleberry argued, that Butterfield did not take reasonable steps to mitigate her damages? Why or why not?
Answer:
No, the court should not hold in favor of Huckleberry.
Explanation:
The rule of mitigation that Huckleberry tries to use in her favor states that the non-breaching party (Butterfield) should have taken all the necessary steps to reduce her loss, e.g. take a job in New York. She probably argued that Butterfield leaving for England to meet with her children made things worse.
But in this case, Butterfield relied on Huckleberry's promise to organize her life and the well being of her children. Butterfield made a lot of changes and sacrifices in her life because of this, e.g. forfeiting unpaid alimony, transferring custody of her children , etc.
Moving to a different city or country requires a lot of work, expat life is not easy and not everyone can handle it. Butterfield took decisions that affected the lives of many people and she is not responsible for Huckleberry's breaching, the only party responsible for all this mess is Huckleberry and it is normal that Butterfield would want to go to where her children are.
ABC Appliance offers a warranty requiring an annual fee. The warranty may be purchased at the time of sale or at any time within the first year after the appliance was purchased. The warranty fee after the date of purchase is twice the time-of-purchase fee. When asked why the fee was higher after the date of purchase, ABC's president said, "Buying a warranty is voluntary. We've noted that those who buy the warranty after the purchase date have a greater need for service." Charging the same rate or a lower rate after the date of purchase would expose ABC to what problem that also impacts private insurers?
Answer: adverse selection
Explanation:
Adverse selection is a situation whereby the sellers possesses information that the buyers do not have. It may also be the other way round whereby the buyers have information which the sellers don't have regarding the quality of a product.
There is information failure between both parties; typically, it's usually the sellers who has more information. Therefore, base on the scenario above, charging same rate or lower rate after the date of the purchase would expose ABC to adverse selection problems.
Demand for dishwasher water pumps is 8 per day. The standard deviation of demand is 3 per day, and the order lead time is four days. The service level is 95%. What should the reorder point be?
Answer:
41.9 units
Explanation:
Reorder point can be defined as the level of inventory which help to triggers an action to replace that particular inventory stock in such a way that when the stock level reduced the item must be reordered because it is the minimum unit quantity that a business owner or an organisation should always have in available inventory before they need to reorder more product.
Using this formula
Reorder point= Demand during the lead time + Z for customer service level * standard deviation * Square root of lead time multiplier.
Where,
Demand during the lead time =(8*4)
Z for customer service level =1.65
Standard deviation =3
Square root of lead time multiplier=4
Let plug in the formula
Reorder point=(8*4) + 1.65*3* square root of(4)
= 41.9 units.
Therefore the Reorder point is 41.9 units
Motorzone offers replacement parts for old Volkswagen Beetles. The company calculates shipping charges based on shipping parts from Boston, even though some parts actually ship from St. Louis. Motorzone most likely practices ________ pricing.
Answer:
basing-point
Explanation:
Basing point pricing is a system used to establish prices in which the business charges a fixed amount for the product and an additional charge for the shipping that is determined according to the customer's distance from a certain place that is called the basing point. According to this, the answer is that Motorzone most likely practices basing-point pricing because they establish the shipping charges based on a pre-determined location even though some products are not in this place.
Strawberry Fields purchased a tractor at a cost of $40,000 and sold it two years later for $25,000. Strawberry Fields recorded depreciation using the straight-line method, a five-year service life, and an $6,000 residual value.
1. What was the gain or loss on the sale?2. Record the sale using a general journal entry.
Answer:
1.Loss on sale 1,400
2.Dr Cash 25,000
Dr Accumulated Depreciation 13,600
Dr Loss on sale 1,400
Cr Equipment - Tractor 40,000
Explanation:
1.Calculation of the gain or loss on the sale of Strawberry Fields
Using this formula
Depreciation per year = (Cost - Salvage value)/Useful life
= (40,000-6,000)/5
=34,000/5
= 6,800 per year
The Book value after two years will be:
40,000 - (6,800*2)
=40,000-13,600
=26,400
Gain(Loss) = Cash received - Book value
= 25,000 - 26,400
Loss on sale 1,400
2.Record of the sale using a general journal entry
Dr Cash 25,000
Dr Accumulated Depreciation 13,600
Dr Loss on sale 1,400
Cr Equipment - Tractor 40,000
Liability policies, such as personal liability, professional malpractice, or business liability insurance, do NOT protect the insured against a. a personal injury on the insured's property, such as the mail carrier who slips and falls on the owner's sidewalk. b. intentional harm caused by the insured. c. someone injured by the insured away from home or business. d. claims for property damaged by the insured.
Answer:
b. intentional harm caused by the insured.
Explanation:
Liability insurance is a means to provide the insured party with some protection against claims resulting from injuries and damage to people or property, covering both legal costs and any payouts for which the insured party would be responsible if found legally liable.
Note that there are two types of liability coverage: bodily injury and property damage. Most states in the US require liability coverages, subject to limits, which is the maximum amount the insurer will pay when the incident occurs. For example, a car accident can be expensive. This is why there is a limit of compensation which an insurer can offer.
Dolan Company's accounting records reflect the following inventories:
Dec.31, 2013 Dec.31, 2012
Raw materials inventory $310,000 $260,000
Work in process inventory 300,000 160,000
Finished goods inventory 190,000 150,000
During 2013, $600,000 of raw materials were purchased, direct labor costs amounted to $500,000, and manufacturing overhead incurred was $480,000.
Dolan Company's total manufacturing costs incurred in 2013 amounted to________.
Answer:
cost of goods manufactured= $1,770,000
Explanation:
Giving the following information:
Dec.31, 2013 Dec.31, 2012
Raw materials inventory $310,000 $260,000
Work in process inventory 300,000 160,000
During 2013, $600,000 of raw materials were purchased, direct labor costs amounted to $500,000, and manufacturing overhead incurred was $480,000.
To calculate the cost of goods manufactured, we need to use the following formula:
cost of goods manufactured= beginning WIP + direct materials used + direct labor + allocated manufacturing overhead - Ending WIP
cost of goods manufactured= 300,000 + (310,000 + 600,000 - 260,000) + 500,000 + 480,000 - 160,000
cost of goods manufactured= $1,770,000
Platen purchased inventory on August 17 and received an invoice with a list price amount of $5,900 and payment terms of 4/10, n/30. Platen uses the net method to record purchases. For what amount should Platen record the purchase
Answer:
$5,664
Explanation:
Calculation of the amount that Platen should record the purchase.
Using this formula
List price -(Percentage of payment term × list price)
Let plug in the formula
$5,900 -(4%×5,900 )
=$5,900-$236
=$5,664
Therefore Platen should record the purchase on August 17 as a:
Debit to Purchases (periodic system) and a Credit to Accounts Payable for $5,664
Therefore the amount that Platen should record the purchase will be $5,664