Answer:
A. $ 7876.8
B. $ 201.6
C. $ 122.4
Explanation:
As per the Internal revenue Service or the IRS, the standard rates of mileage for the year 2020 is :
Automobile -- 54.5
Charity ---- 14
Medical ---- 17
A. Lara's automobile deduction for business is = 14,400 miles x 0.547
= $ 7876.8
B. Lara's expenses for the charitable contribution deduction is
= 1,440 miles x 0.14
= $ 201.6
C. Lara's expenses for her medical deduction is = 720 miles x 0.17
= $ 122.4
An investor purchased a "par bond" for $300 with the principal $300. Over n = 5 years the bond will pay 8% coupon annually. Find the IRR of the cash flow stream (also called Yield to Maturity).
Answer:
8%
Explanation:
Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
Cash flow in year 0 = $-300
Cash flow each year from year 1 to 4 = [tex]\frac{8}{100}[/tex] × $300 = $24
Cash flow in year 5 = $300 + 24 = $324
IRR = 8%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
The Lawrence Company records its trade accounts payable net of any cash discounts. At the end of 2016, Lawrence had a balance of $300,000 in its trade accounts payable account before any adjustments related to the following items: 1. Goods shipped to Lawrence FOB shipping point were in transit on December 31. The invoice price of the goods was $50,000, with a 2% discount allowed for prompt payment. 2. Goods shipped to Lawrence FOB destination on December 29 arrived on January 2, 2017. The invoice price of the goods was $9,000, with a 4% discount allowed for payment within 20 days. 3. On December 10, Lawrence had recorded a shipment received. The recorded invoice price was $24,750, net, with a 1% discount allowed for payment within 14 days. At the end of the year, payment had not been made. At what amount should Lawrence report trade accounts payable on its December 31, 2016 balance sheet
Answer:
The Lawrence Company
The amount that Lawrence should report trade accounts payable on its December 31, 2016 balance sheet is:
= $349,000.
Explanation:
a) Data and Calculations:
Trade accounts payable balance on December 31, 2016 = $300,000
1. Shipment at FOB Shipping point at $50,000(2% discount) 49,000
2. Shipment at FOB destination on December 29 (Jan. 2) 0
3. Already recorded invoice of $24,750 (with 1% discount) 0
Total value of accounts payable balance on December 31 $349,000
Suppose a monopolist is producing a level of output such that MR > MC. Which of the following best describes what will happen as the firm moves to its profit-maximizing equilibrium? A) Marginal revenue will rise and marginal cost will fall. B) Marginal cost and marginal revenue will both rise. C) Marginal revenue will fall and marginal cost will rise. D) Marginal cost and marginal revenue will both fall.
Answer: C) Marginal revenue will fall and marginal cost will rise.
Explanation:
The profit-maximizing equilibrium is the production point where the Marginal Revenue equals the Marginal cost.
As the monopolist moves towards this point, they will see their marginal costs increase because they will be producing more goods.
For a monopolist to sell more goods however, they will need to reduce their prices. This means that Marginal revenue will come down.
Marginal revenue will keep decreasing and Marginal cost will keep increasing until both of them become equal to each other.
Which organization would you work best in, an organically or mechanistically structured one, and why?
Answer:
i dont know
Explanation:
Bob is a farmer and is required to use the accrual method. At the beginning of the year, Bob has inventory, including livestock held for resale, amounting to $10,000. During the year, Bob purchased livestock totaling $3,000. Bob's ending inventory was $4,000. Bob's net sales for the year totaled $17,000. What is Bob's gross profit for the current year
Answer:
$3,000
Explanation:
Gross Profit = Sales - Cost of Sales
Prepare a Trading Account for Bob to determine gross profit.
Nancy, the owner of a very successful hotel chain in the Southeast, is exploring the possibility of expanding the chain into a city in the Northeast. She incurs $35,000 of expenses associated with this investigation. Based on the regulatory environment for hotels in the city, she decides not to expand. During the year, she also investigates opening a restaurant that will be part of a national restaurant chain. Her expenses for this are $53,000. The restaurant begins operations on September 1.
Determine the amount Nancy can deduct in the current year for investigating these two businesses.
Answer:
$3,133.
As regard to opening a restaurant, investigation expense = 53,000 - 2000 = $51,000.
Explanation:
Before diving straight into the solution to this problem, let's take out some of the parameters given in the question above.
=> Nancy incurs $35,000 of expenses associated with the investigation of the possibility of expanding the chain into a city in the Northeast.
=> Nancy expenses for investigates opening a restaurant that will be part of a national restaurant chain are $53,000.
The first thing to do right now is to determine the value for the investigation as regard to the opening of a restaurant = [ 2000 × (51,000/180 months) × 4] = $3,133.
The next thing is to determine the value for the deduction which is available. This can be done below as:
The amount Nancy can deduct in the current year for investigating these two businesses = 5000 - [ 53000 - 50000] = $2, 000
As regard to opening a restaurant, investigation expense = 53,000 - 2000 = $51,000.
On March 1, 2019, Rasheed Company assigns $825,000 of its accounts receivable to the Third National Bank as collateral for a $600,000 loan due April 1, 2019. The assignment agreement calls for Rasheed Company to continue to collect the receivables. Third National Bank assesses a finance charge of 2.5% of the accounts receivable, and interest on the loan is 8% (a realistic rate of interest for a note of this type).
Required:
a. Prepare the March 1, 2019, journal entry for Rasheed Company.
b. Prepare the journal entry for Rasheed's collection of $750,000 (need to factor out discounts and sales returns) of the accounts receivable during March of 2019. Sales discounts of $8,000 apply, as well as $22,000 of sales returns.
c. On April 1, 2019, Rasheed paid Third National all that was due from the loan it secured on March 1, 2019. Prepare the journal entry to record this payment.
Answer:
A.Dr Cash 579,375
Dr Finance charge 20,625
Cr Loan payable 600,000
Dr Accounts Receivable Assigned 825,000
Cr Accounts Receivable 825,000
b) Dr Cash 750,000
Cr Sales discounts 8,000
Cr Sales returns 22,000
Cr Accounts Receivable Assigned 720,000
c)Dr Loan Payable 600,000
Cr nterest expense 4,000
Cr Cash 596,000
Explanation:
a. Preparation for March 1, 2019, journal entry for Rasheed Company
March 01,2019
Dr Cash 579,375
(600,000-20,625)
Dr Finance charge (825,000*2.5%) 20,625
Cr Loan payable 600,000
(Loan amount received)
March 01,2019
Dr Accounts Receivable Assigned 825,000
Cr Accounts Receivable 825,000
(Assigning Accounts receivable)
b.Preparation of the journal entry for Rasheed's collection of the amount of $750,000 of the accounts receivable during March of 2019
March, 2019
Dr Cash 750,000
Cr Sales discounts 8,000
Cr Sales returns 22,000
Cr Accounts Receivable Assigned 720,000
(750,000-8,000-22,000)
C.Preparation of the journal entry to record this payment.
April 01,2019
Dr Loan Payable 600,000
Cr nterest expense (600,000*8%*1/12) 4,000
Cr Cash 596,000)
(600,000-4,000)
(Loan settled along with interest)
Bond X is a premium bond making semiannual payments. The bond has a coupon rate of 9.2%, a YTM of 7.2%, and has 17 years to maturity. Bond Y is a discount bond making semiannual payments. This bond has a coupon rate of 7.2%, a YTM of 9.2%, and also has 17 years to maturity. Assume the interest rates remain unchanged and both bonds have a par value of $1,000.
1. What are the prices of these bonds today?
2. What do you expect the prices of these bonds to be in one year?
3. What do you expect the prices of these bonds to be in three years?
4. What do you expect the prices of these bonds to be in eight years?
5. What do you expect the prices of these bonds to be in 12 years?
6. What do you expect the prices of these bonds to be in 17 years?
Answer:
I used an Excel spreadsheet to calculate the answers (see attached file):
1. What are the prices of these bonds today?
bond X = $1,194
bond Y = $830
2. What do you expect the prices of these bonds to be in one year?
bond X = $1,194
bond Y = $830
3. What do you expect the prices of these bonds to be in three years?
bond X = $1,175
bond Y = $844
4. What do you expect the prices of these bonds to be in eight years?
bond X = $1,131
bond Y = $879
5. What do you expect the prices of these bonds to be in 12 years?
bond X = $1,083
bond Y = $921
6. What do you expect the prices of these bonds to be in 17 years?
bond X = $1,046
bond Y = $1,036
Bruce Corporation makes four products in a single facility. These products have the following unit product costs:
Products
A B C D
Direct materials $16.10 $20.00 $13.00 $15.70
Direct labor 18.10 21.50 15.90 9.90
Variable manufacturing overhead 4.90 6.10 8.60 5.60
Fixed manufacturing overhead 28.00 14.90 15.00 17.00
Unit product cost 67.10 62.50 52.50 48.20
Additional data concerning these products are listed below.
Products
A B C D
Grinding minutes per unit 2.25 1.35 0.95 0.55
Selling price per unit $81.20 $73.60 $70.40 $65.10
Variable selling cost per unit $3.10 $3.60 $3.30 $4.00
Monthly demand in units 3,500 2,500 2,500 4,500
The grinding machines are potentially the constraint in the production facility. A total of 10,500 minutes are available per month on these machines. Direct labor is a variable cost in this company.
Required:
Which product makes the MOST profitable use of the grinding machines?
Answer:
Product D
Explanation:
Calculation to determine Which product makes the MOST profitable use of the grinding machines
First step is to calculate the Variable cost per unit
Products
A B C D
Direct materials $16.10 $20.00 $13.00 $15.70
Add Direct labor 18.10 21.50 15.90 9.90
Add Variable manufacturing overhead 4.90 6.10 8.60 5.60
Add Variable selling cost per unit $3.10 $3.60 $3.30 $4.00
Variable cost per unit $42.20 $51.60 $40.80 $35.20
Now let calculate the product that makes the MOST profitable use of the grinding machines
Selling price per unit $81.20 $73.60 $70.40 $65.10
Less Variable cost per unit $42.20 $51.60 $40.80 $35.20
=Contribution margin per unit $39 $22 $29.60 $29.90
÷Grinding minutes per unit 2.25 1.35 0.95 0.55
=Contribution per grinding minutes $17.33 $16.30 $31.16 $54.36
Therefore Based on the above calculation the product that makes the MOST profitable use of the grinding machines is PRODUCT D because it has the highest Contribution per grinding minutes of the amount of $54.36
1. Compute the throughput time. 2. Compute the manufacturing cycle efficiency (MCE) for the quarter. (Round your percentage answer to nearest whole percent.) 3. What percentage of the throughput time was spent in non–value-added activities? (Round your percentage answers to the nearest whole percent.) 4. Compute the delivery cycle time. 5. If by using Lean Production all queue time during production is eliminated, what will be the new MCE? (Round your percentage answer to 1 decimal place.)
Answer:
1. Throughput time.
This is the length of time it takes to transform a raw material into finished goods.
= Inspection time + Process time + Move time + Queue time
= 0.7 + 2.8 + 1.3 + 4.1
= 8.9 days
2. Manufacturing Cycle Efficiency:
= Value added time / Throughput time * 100%
= 2.8 / 8.9 * 100%
= 31%
3. Percentage of time spent on none valuable activities:
= 1 - Manufacturing cycle efficiency
= 1 - 31%
= 69%
4. Delivery Cycle time:
= Wait time + Throughput time
= 16.2 + 8.9
= 25.1 days
5. New MCE.
Queue time is eliminated:
= 8.9 - 4.1
New Throughput time = 4.8 days
MCE = 2.8 / 4.8
= 58%
LUVFINANCE, Inc. is estimating its WACC. It is operating at its optimal capital structure. Its outstanding bonds have a 12 percent coupon, paid semiannually, a current maturity of 17 years, and sell for $1,162. It has 100,000 bonds outstanding. The firm can issue new 20-year maturity semiannual bonds at par but will incur flotation costs of $50 per bond. The firm could sell, at par, $100 preferred stock that pays a 12 percent annual dividend that is currently selling for $120. The firm currently has 1,000,000 shares of preferred stock outstanding. Rollins' beta is 0.94, the risk-free rate is 3.72 percent, and the market risk premium is 6 percent. The common stock currently sells for $100 a share and there are 5,000,000 shares outstanding. The firm's marginal tax rate is 40 percent.
Required:
What is the WACC?
Solution :
Given :
The cost of the debt is yield to the maturity of the bonds.
The yield on the bond is 10%
The tax rate is 40%
After the tax cost of the debt = 10 ( 1- 0.4 )
= 6 %
Add floatation cost at the rate of 5% = 11%
Cost of the preferred stock = [tex]$\frac{\text{dividend}}{\text{price}}$[/tex]
= [tex]$\frac{120}{12}$[/tex] = 10%
The cost of equity = risk free rate + β x market risk premium
= 3.72 + 0.94 x 6
= 9.36%
WACC is weighted average of the individual securities :
Particulars Value per No. of Market value Weight Cost of Product
security securities security
Bonds 1162 100,000 116,200,000 0.1578 11 1.73621298
Preferred 120 1,000,000 120,000,000 0.1629 10 1.6299918
stocks
Equity 100 5,000,000 500,000,000 0.6791 9.36 6.356968
736,200,000 1 WACC 9.7231730
Therefore, WACC of the firm is 9.72%
A food worker has prepared a large pot of rice that must be cooled. How should the food worker cool the rice safely?
Answer:
Cover the pot and leave it at room temperature.
Explanation:
That's how a food worker would cool rice safely.
Answer: Cover the pot and leave it at room temperature.
Explanation: took the test
Answer the below case problem, giving the legal issue, the governing law and the rationale in support of your conclusion.
Arthur Jensen, Inc., was a corporation engaged in the housing construction business.
Arthur Jensen set up and was the sole owner and president of the corporation. Alaska Valuation Service [AVS] conducted housing appraisals for Jensen on numerous occasions over the years. When AVS took the orders for appraisals, it was not aware that it was dealing with a corporation. It believed that it was dealing directly with Jensen [i.e., as a sole proprietor]. Jensen never specifically informed AVS of his status as the president of Arthur Jensen, Inc. When AVS was not paid for appraisal services that it had performed, AVS sued Arthur Jensen, attempting to hold him personally liable for the unpaid appraisals.
Arthur Jensen argued that he could not be personally liable because he had acted on behalf of his corporation.
1. Decide the case based on the above stated facts.
2. Assuming Arthur Jensen could be held personally liable, how could Arthur
Jensen have better protected himself? [we discussed this in class]
Answer:
1. Decide the case based on the above stated facts.
Corporations provide limited liability to their owners, and one person corporations are legal in all states. Depending on how Arthur handled his business, the corporate veil might or not be lifted. If he separated the corporate account and managed the corporation separately for his other assets, then he is not liable.
On the other hand, if he paid the bills using his personal account, or used the corporation's assets as his own, then the outcome might change. We are not given enough details.
2. Assuming Arthur Jensen could be held personally liable, how could Arthur Jensen have better protected himself?
Simple, he should sign as the president of the corporation and pay using the corporation's account.
On January 1, 2021, Carla Vista Corporation signed a 5-year noncancelable lease for equipment. The terms of the lease called for Carla Vista to make annual payments of $195000 at the beginning of each year for 5 years beginning on January 1, 2021 with the title passing to Carla Vista at the end of this period. The equipment has an estimated useful life of 7 years and no salvage value. Carla Vista uses the straight-line method of depreciation for all of its fixed assets. Carla Vista accordingly accounts for this lease transaction as a finance lease. The lease payments were determined to have a present value of $813124 at an effective interest rate of 10%.
In 2022, Carla Vista should record interest expense of:________
a. $67994.
b. $48494.
c. $61812.
d. $42312.
Answer:
In 2022, Carla Vista should record interest expense of:________
c. $61,812.
Explanation:
a) Data and Calculations:
The Present Value (PV) of a 5-year noncancelable lease of equipment = $813,124
Annual lease payments = $195,000
Effective interest rate = 10%
Estimated lease term = 5 years
Estimated useful life of equipment = 7 years
Salvage value of equipment = $0
Method of Depreciation = Straight-line method
Lease period percentage = 71% (5/7)
Interest expense:
December 31, 2021 = $81,312 ($813,124 * 10%)
December 31, 2022 - $61,812 ($813,124 - $195,000 * 10%)
Flexible Budget for Selling and Administrative Expenses for a Service Company Cloud Productivity Inc. uses flexible budgets that are based on the following data: Sales commissions 14% of sales Advertising expense 18% of sales Miscellaneous administrative expense $6,500 per month plus 12% of sales Office salaries expense $28,000 per month Customer support expenses $12,000 per month plus 20% of sales Research and development expense $30,000 per month Prepare a flexible selling and administrative expenses budget for March for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 5 as a model.)
Answer:
Selling and administrative expenses budget for March
Sales Volume $400,000 $500,000 $600,000
Sales commissions at 14 % $56,000 $70,000 $84,000
Advertising expense at 18% $72,000 $90,000 $108,000
Miscellaneous at $6,500 + 12% $54,500 $66,500 $78,500
Office salaries at $28,000 $28,000 $28,000
Customer support at $12,000 + 20% $92,000 $112,000 $132,000
Research and development at $30,000 $30,000 $30,000
Total $332,500 $396,500 $460,500
Explanation:
A flexible is a budget that is adjusted to the actual activity. Thus, adjust the costs items to the appropriate Sales Volumes.
Inventory records for Dunbar Incorporated revealed the following:
Date Transaction Number Unit
of Units Cost
Apr. 1 Beginning inventory 550 $2.33
Apr. 20 Purchase 310 2.68
Dunbar sold 560 units of inventory during the month. Ending inventory assuming weighted-average cost would be:__________.
a. $737.
b. $694.
c. $817.
d. $752.
Answer:
a. $737.
Explanation:
The computation of the ending inventory using weighted average cost is shown below:
But before that first determine the average cost per unit
= (Beginning cost + purchase cost) ÷ (Beginning units + purchased units)
= (550 × $2.33 + 310 × $2.68) ÷ (550 units + 310 units)
= ($1,281.5 + $830.8) ÷ (860 units)
= $2.46
Now the ending inventory is
= (860 units - 560 units) × $2.46
= $737
How fast do you guys help students answer questions?
Answer:
it depends on who is answering, what the question is, and what you want in the question. regularly answers come within 5 minutes, but if its really complicated then those questions almost never get answered
Lonergan Company occasionally uses its accounts receivable to obtain immediate cash. At the end of June 2021, the company had accounts receivable of $920,000. Lonergan needs approximately $570,000 to capitalize on a unique investment opportunity. On July 1, 2021, a local bank offers Lonergan the following two alternatives:
A. Borrow $570,000, sign a note payable, and assign the entire receivable balance as collateral. At the end of each month, a remittance will be made to the bank that equals the amount of receivables collected plus 10% interest on the unpaid balance of the note at the beginning of the period.
B. Transfer $620,000 of specific receivables to the bank without recourse. The bank will charge a 3% factoring fee on the amount of receivables transferred. The bank will collect the receivables directly from customers. The sale criteria are met.
Required:
1. Prepare the journal entries that would be recorded on July 1 for:
a. alternative a.
b. alternative b.
2. Assuming that 70% of all June 30 receivables are collected during July, prepare the necessary journal entries to record the collection and the remittance to the bank for:____.
a. alternative a.
b. alternative b.
Answer:
1.
ALTERNATIVE A
01-Jul
Dr Cash $570,000
Cr Notes Payable $570,000
ALTERNATIVE B
01-Jul
Dr Cash 601,400
Dr Loss on sale of receivables $18,600
Cr Accounts Receivables $620,000
2.
ALTERNATIVE A
Dr Cash $644,000
Cr Notes Payable $644,000
Dr Interest Expense $4,750
Dr Notes Payable 570,000
Cr Cash 574,750
ALTERNATIVE B
Dr Cash $210,000
Cr Accounts Receivable $210,000
Explanation:
1. Preparation of the journal entries that would be recorded on July 1 for alternative a and
alternative b.
ALTERNATIVE A
01-Jul
Dr Cash $570,000
Cr Notes Payable $570,000
(Notes payable collected)
ALTERNATIVE B
01-Jul
Dr Cash 601,400
($620,000-$18,600)
Dr Loss on sale of receivables $18,600 (3%*$620,000)
Cr Accounts Receivables $620,000
(Remittance to bank)
2. Preparation of the necessary journal entries to record the collection and the remittance to the bank for alternative a and
alternative b.
ALTERNATIVE A
Dr Cash (920,000 x 70%) $644,000
Cr Notes Payable $644,000
Dr nterest Expense($570,000 x 10%x 1/12) $4,750
Dr Notes Payable 570,000
Cr Cash 574,750
($570,000+$4,750)
ALTERNATIVE B
Dr Cash [ (920,000 -620,000)x 70%] $210,000
Cr Accounts Receivable $210,000
Find the following values. Compounding/discounting occurs annually. Do not round intermediate calculations. Round your answers to the nearest cent. a. An initial $400 compounded for 10 years at 5%. $ b. An initial $400 compounded for 10 years at 10%. $ c. The present value of $400 due in 10 years at 5%. $ d. The present value of $2,515 due in 10 years at 10% and 5%. Present value at 10%: $ Present value at 5%: $
Answer:
$651.56
$1037.50
$245.57
$969.64
$1543.99
Explanation:
The formula for calculating future value:
FV = P (1 + r)^n
FV = Future value
P = Present value
R = interest rate
N = number of years
a. 400 x (1.05)^10 = $651.56
b. 400 x (1.1)^10 = $1037.50
formula for determining present value is
PV = f / (1 + r)^n
$400/ (1.05)^10 = $245.57
d. $2515 / (1.1)^10 = $969,64
$2515 / (1.05)^10 = $1543.99
central bank definition
Explanation:
a national bank that provides financial and banking services for its country's government and commercial banking system, as well as implementing the government's monetary policy and issuing currency.
At the end of 2009, the following information is available for Clobes Company, Snyder Company, and Welz Company (you must show your calculations to receive full credit): Required: Which company has the highest level of financial risk? Using an appropriate ratio, support your answer. Which company is the most profitable from the owners' perspective? Using an appropriate ratio, support your answer. (3) Which company is getting the greatest return on assets? Show calculations.
Answer:
Answer is explained in the explanation section below.
Explanation:
Note: This question is incomplete and lacks necessary data to solve for this question. However I have found similar question on the internet and I will be using that data. Besides, I have attached the data used in the attachment below.
Solution:
1. The debt-to-equity ratio is the best way to assess financial risk. A higher debt-to-equity ratio indicates a higher level of financial risk. This ratio represents the willingness of the equity of the owners to fulfil their obligations.
Formula used:
Debt-to-equity ratio = Total liabilities divided by owner's equity
For Clobes:
Total liabilities = 100,000
Owners' equity = 200,000
Debt-to-equity ratio = 100000/200000 = 0.5
For Snyder:
Total liabilities = 300,000
Owners' equity = 200,000
Debt-to-equity ratio = 300000/200000 = 1.5
For Welz:
Total liabilities = 300,000
Owners' equity = 100,000
Debt-to-equity ratio = 300000/100000 = 3
Welz faces the greatest financial risk because it has the highest debt-to-equity ratio. It has a debt-to-equity ratio of three. Even though it depends on the industry, a company's debt-to-equity ratio should be between 1 and 1.5 if it is considered optimal. In this case, Welz's financial risk is considerably higher.
2. calculate Return on Equity(ROE)
Formula used:
ROE = Net income / Owner's equity
For Clobes:
Net income = 25,000
Owners' equity = 200,000
ROE = 25,000 / 200000 = 0.125
For Snyder:
Net income = 30,000
Owners' equity = 200,000
ROE = 30000 / 200000 = 0.15
For Welz:
Net income = 20,000
Owners' equity = 200,000
ROE = 20000 / 100000 = 0.2
Welz has the highest return of equity (ROE) of 0.2.
As a result, Welz is the most profitable company.
3. Return on assets:
Formula used
Return on Assets = Net income / Total assets
For Clobes:
Net income = 25,000
Total assets = 300,000
Return on Assets = 25,000 / 300000 = 0.08
For Snyder:
Net income = 30,000
Total assets = 500000
Return on Assets = 30000 / 500000 = 0.06
For Welz:
Net income = 20,000
Total assets = 400,000
Return on Assets = 20000 / 400000 = 0.05
Hence,
Clobes has the highest return on assets, which is 0.08.
For the coming year, Cleves Company anticipates a unit selling price of $100, a unit variable cost of $60, and fixed costs of $480,000.
Required:
1. Compute the anticipated break-even sales in units.
2. Compute the sales (units) required to realize a target profit of $240,000.
3. Construct a cost-volume-profit chart, assuming maximum sales of 20,000 units within the relevant range. From your chart, indicate whether each of the following sales levels would produce a profit, a loss, or break-even.
$1,200,000 SelectBreak-evenLossProfitItem 3
$1,000,000 SelectBreak-evenLossProfitItem 4
$800,000 SelectBreak-evenLossProfitItem 5
$400,000 SelectBreak-evenLossProfitItem 6
$200,000 SelectBreak-evenLossProfitItem 7
4. Determine the probable income (loss) from operations if sales total 16,000 units.
Solution :
1. The break even sales in units is given by :
Break even sales in units = [tex]$\frac{\text{fixed cost}}{\text{contribution per unit}}$[/tex]
Where, contribution per unit = selling price per unit - variable cost per unit
The anticipated break even sales in units of Cleaves company in the coming year is :
Break even sales in units = [tex]$\frac{480,000}{40}$[/tex]
Contribution per unit = $ 100 - $ 60
= $ 40
So the company anticipates its breakeven sales at 12,000 units.
2. In order tot earn profit the sales generated should overcome the breakeven point. The desired profit is $240,000, the sales required to earn the desired profit can be computed using the formula :
Desired sales in units = [tex]$\frac{\text{fixed cost + desired cost}}{\text{contribution per unit}}$[/tex]
[tex]$=\frac{480,000+240,000}{40}$[/tex]
= 18,000 units
Thus, the sales in units required to earn a profit of $ 240,000 are 18,000 units.
3. The sales in excess of the breakeven point would yield a profit on the contrary the sales below the breakeven point would result in a loss.
In the given sales in dollar = breakeven sales in units x selling price per unit
= 12,000 x 100
= $ 1,200,000
∴ the sales above $1,200,000 would result in a profit whereas the sales below $1,200,000 would result in loss.
The cost volume profit chart below indicates the profit, loss, breakeven at different sales levels :
Sales levels Result
1,200,000 Breakeven
1,000,000 Loss
800,000 Loss
400,000 Loss
200,000 Loss
4. The income on sale of 16,000 units is computed below :
Particulars Amount is $
Sales 1,600,000
Less : variable cost 960,000
Contribution 640,000
Less : Fixed cost 480,000
Profit 160,000
The break-even sales in units are calculated as follows:
What is Break Even Point ?Breakeven unit sales =
In this case, contribution per unit equals selling price per unit minus variable cost per unit.
The Cleaves Company's estimated break-even unit sales for the upcoming year are:
Breakeven unit sales =
Contribution per unit equals $100 minus $60.
= $ 40
The business therefore projects 12,000 units as its breakeven sales.
(2) 2. Sales must exceed the breakeven point in order to create a profit. The sales needed to achieve the desired profit, which is $240,000, can be calculated using the formula:
Ideally, sales would equal
= 18,000 units
Thus, the sales in units required to earn a profit of $ 240,000 are 18,000 units.
(3) 3. Sales beyond the breakeven threshold would result in a profit; sales below the breakeven point, on the other hand, would result in a loss.
Sales in dollars for the given period equal breakeven sales in units times selling price per unit.
= 12,000 x 100
= $ 1,200,000
Sales that exceed $1,200,000 generate a profit, whilst sales that go below that threshold generate a loss.
The following cost volume profit chart shows the profit, loss, and breakeven points at various sales levels:
Resulting sales levels
Breakeven is 1,000,000
1,000,000 Loss
800,000 Loss
400,000 Loss
200,000 Loss
4. The earnings from the sale of 16,000 units are calculated as follows:
Particulars The amount is $
Sales 1,600,000
Variable cost is 960,000 less.
640,000 dollars were contributed.
Less: 480,000 in fixed costs.
Gain of 160,000
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# SPJ 2
Muecke Inc. is working on its cash budget for April. The budgeted beginning cash balance is $40,000. Budgeted cash receipts total $150,000 and budgeted cash disbursements total $158,000. The desired ending cash balance is $50,000. To attain its desired ending cash balance for April, the company needs to borrow: Group of answer choices $18,000 $0 $50,000 $82,000
Answer:
See
Explanation:
Presented below is a condensed version of the comparative balance sheets for Ravensclaw Corporation for the last two years at December 31.
2019 2018
Cash $230,100 $101,400
Accounts receivable 234,000 240,500
Investments 67,600 96,200
Equipment 387,400 312,000
Accumulated Depreciation-Equipment (137,800 ) (115,700 )
Current liabilities 174,200 196,300
Common stock 208,000 208,000
Retained earnings 399,100 230,100
Additional information:
Investments were sold at a loss of $13,000; no equipment was sold; cash dividends paid were $39,000; and net income was $208,000.
Required:
Create a Statement of Cash Flows for 2019.
Answer:
Ravensclaw Corporation
Statement of Cash Flows for the year ended December 31, 2019:
Net income $208,000
Add non-cash expense:
Depreciation expense 22,100
Loss from sale of investment 13,000
Cash from operations $243,100
Adjustments of working capital:
Accounts receivable $6,500
Current liabilities -22,100
Net cash from operations $227,500
Investing activities:
Cash from investment sale 15,600
Equipment -75,400
Financing activities:
Cash dividends paid -39,000
Net cash flows $128,700
Explanation:
a) Data and Calculations:
2019 2018 Differences
Cash $230,100 $101,400 +$128,700
Accounts receivable 234,000 240,500 -$6,500
Investments 67,600 96,200 -$28,600
Equipment 387,400 312,000 +$75,400
Accumulated Depreciation-
Equipment (137,800) (115,700) +$22,100 Depreciation Exp.
Current liabilities 174,200 196,300 -$22,100
Common stock 208,000 208,000 $0
Retained earnings 399,100 230,100 +$169,000
Cash dividends +$39,000
Net income = $208,000 ($169,000 + $39,000)
Cash from sold investments = $15,600 ($28,600 - $13,000)
Question 7 (4 points)
Saved
Which of the following inestments would be considered the most liquid?
Question 7 options:
Real Estate
A one year CD
A standard savings account
A 401k
common stock definition.
Answer:
Common stock is a security that represents ownership in a corporation.
Explanation:
Holders of common stock elect the board of directors and vote on corporate policies.
The information below pertains to Barkley Company for 2015.
Net income for the year $2,240,000
9% convertible bonds issued at par ($1,000 per bond); each bond is convertible into 30 shares of common stock 2,112,000
6% convertible, cumulative preferred stock, $100 par value; each share is convertible into 3 shares of common stock 4,707,000
Common stock, $10 par value 6,959,000
Tax rate for 2015 45%
Average market price of common stock $25 per share
There were no changes during 2015 in the number of common shares, preferred shares, or convertible bonds outstanding. There is no treasury stock. The company also has common stock options (granted in a prior year) to purchase 75,800 shares of common stock at $15 per share.
(a) Compute basic earnings per share for 2015. (Round answer to 2 decimal places, e.g. $2.55.)
Basic earnings per share
$
(b) Compute diluted earnings per share for 2015. (Round answer to 2 decimal places, e.g. $2.55.)
Diluted earnings per share
$
Income Statement Wayne Corporation had the following revenue and expense account balances (in millions) for a recent year ending May 31:
Depreciation Expense $925
Fuel Expense 3,228
Maintenance and Repairs Expense 1,573
Other Expense 4,995
Provision for Income Taxes 805
Purchased Transportation 1,203
Rentals and Landing Fees 1,748
Revenues 24,698
Salaries and Employee Benefits 8,815
Prepare an income statement.
Answer:
Income Statement
Revenue $24,698
Expenses
Salaries and employee benefits $8,815
Purchased Transportation $1,203
Fuel Expense $3,228
Rental and landing fees $1,748
Depreciation Expense $925
Maintenance and repairs expense $1,573
Provision for income taxes $805
Other expense (revenue) net $4,995
Total Expenses $23,292
Net Income $1,406
describe the role of the public sector
Answer:
The public sector includes all sorts of government (central, state, and local). It provides basic goods or services that are either not, or cannot be, provided by the private sector, for example, schools, roads, etc.
Explanation:
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Why is it important to consider how you will spend your retirement when planning for retirement?
Answer:
Retirement planning is important because it can help you avoid running out of money in retirement. Your plan can help you calculate the rate of return you need on your investments, how much risk you should take, and how much income you can safely withdraw from your portfolio.
Explanation: