Answers
Answer: hi some parts of your question is missing attached below is the missing table
answer : $17,000
Explanation:
when we split ( Monopoly splits to duopoly )
Maximum profit price = $14
because at $14 ; MR ( marginal revenue ) = MC ( marginal cost ) = 18,000
Maximum profit quantity = 7000
Hence Profit by both firms = TR - TC ( Total cost )
= ( 14 * 7000 ) - 64000 = $34000
∴ profit by each firm = 34,000 / 2 = $17,000
Related Questions
Maestro Inc has a $1,000, 6% coupon bond with interest payable semiannually and a remaining term of 20 years. The market yield on similar bonds is 10%. What percentage of face value is the bond selling for today
Answers
Answer:
65.682%
Explanation:
The computation of the percentage is shown below;
But before that first determine the present value i.e.
Given that
Future value = $1,000
PMT = $1,000 × 6% ÷ 2 = $30
RTAE = 10% ÷ 2 = 5%
NPER = 20 × 2= 40
the formula is shown below;
= -PV(RATE,NPER,PMT,FV,TYPE)
After applying the above formula, the present value is $656.82
Now the percentage is
= $656.82 ÷ $1,000
= 65.682%
The controller of Carla Vista Production has collected the following monthly expense data for analyzing the cost behavior of electricity costs.
Total Electricity Costs Total Machine Hours
January $2,650 200
February 3,100 320
March 3,570 450
April 4,750 695
May 3,160 500
June 4,910 750
July 4,130 630
August 3,810 580
September 5,060 680
October 4,390 610
November 3,290 320
December 8,920 770
(a) Determine the fixed and variable cost components using the high-low method.
(b) What electricity cost does the cost equation estimate for a level of activity of 450 machine hours?
(c) What electricity cost does the cost equation estimate for a level of activity of 750 machine hours?
Answers
Answer:
Results are below.
Explanation:
Giving the following information:
January $2,650 200
February 3,100 320
March 3,570 450
April 4,750 695
May 3,160 500
June 4,910 750
July 4,130 630
August 3,810 580
September 5,060 680
October 4,390 610
November 3,290 320
December 8,920 770
To calculate the variable and fixed components using the high-low method, we need to use the following formulas:
Variable cost per unit= (Highest activity cost - Lowest activity cost)/ (Highest activity units - Lowest activity units)
Variable cost per unit= (8,920 - 2,650) / (770 - 200)
Variable cost per unit= $11
Fixed costs= Highest activity cost - (Variable cost per unit * HAU)
Fixed costs= 8,920 - (11*770)
Fixed costs= $450
Fixed costs= LAC - (Variable cost per unit* LAU)
Fixed costs= 2,650 - (11*200)
Fixed costs= $450
Now, the total cost if the machine hours equals 450:
Total cost= 11*450 + 450= $5,400
Finally, 750 hours:
Total cost= 11*750 + 450= $8,700
The 1-year, 2-year. 3-year,and 4-year risk-free zero rates are 4%, 4.5%, 4.75%, and 5% with continuous compounding. What is the forward rate for the one year period beginning in two years
Answers
Answer:
5.25%
Explanation:
Mathematically, investing at the 3-year risk-free zero rate should be the same as investing at a 2-year risk-free zero rate and one-year forward rate beginning in two years as shown thus
(1+S3)^3=(1+S2)^2*(1+y2y1)^1
S3=4.75%
S2=4.5%
y2y1=unknown
(1+4.75%)^3=(1+4.5%)^2*(1+y2y1)
1+y2y1=(1+4.75%)^3/(1+4.5%)^2
y2y1=((1+4.75%)^3/(1+4.5%)^2)-1
y2y1=5.25%
You wish to earn a return of 13% on each of two stocks, X and Y. Stock X is expected to pay a dividend of $3 in the upcoming year while Stock Y is expected to pay a dividend of $4 in the upcoming year. The expected growth rate of dividends for both stocks is 7%. The intrinsic value of stock X______
a. cannot be calculated without knowing the market rate of return
b. will be greater than the intrinsic value of stock Y
c. will be the same as the intrinsic value of stock Y
d. will be less than the intrinsic value of stock Y
e. none of the above is a correct answer.
Answers
Answer: D. will be less than the intrinsic value of stock Y
Explanation:
Based on the information given above, the intrinsic value of Stock X will be calculated thus:
D1 = Dividend in next year = $3
g = growth rate = 7%
r = = 13%
Therefore, intrinsic value of Stock X will be:
= D1 / (r-g)
= 3 / (13% - 7%)
= 3/6%
= 3 / 0.06
= $50
Therefore, the intrinsic value of stock X is $50.
Intrinsic value of Stock Y will b calculated thus:
D1 = $4
g = 7%
r = 13%
Intrinsic value of Stock Y will be:
= D1 / (r-g)
= 4 / (13% - 7%)
= 4/6%
= 4 / 0.06
= 66.67
Intrinsic value of Stock Y is $66.67
Therefore, the intrinsic value of Stock X will be less than the intrinsic value of Stock Y
please help me out with this problem
Answers
Answer: organizing
Explanation:
When applying for the FAFSA, which of the following is not true?
Answers
Answer:
it provides early admission
Explanation:
thats my answer
When applying for FAFSA, the following is not true : The earliest one can apply and submit for FAFSA is January 1st of each year.
FAFSAFAFSA stands for Free Application for Federal Students Aid.
FAFSA is financial aid eligibility form for the students of United States of America. The FAFSA provides aids such as federal grants, loans, federal students aid, etc. to the college students.
The earliest one can submit for FAFSA is 1st of October every year.
FAFSA can be filled online or on paper.
Both dependent and independent students can fill for FAFSA.
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Over/Under: Alpha failed to record AJEs for $500 interest earned from a note receivable and $700 interest incurred from a note payable. None of the interest will be paid or received until next year. This has what effect on assets, liabilities, and net income
Answers
Answer:
Alpha
The effects on assets, liabilities, and net income are as follows:
Assets are understated by $500
Liabilities are understated by $700
Net income is overstated by $200
Explanation:
a) Data and Calculations:
Interest earned from a note receivable = $500
Interest incurred from a note payable = $700
Failure to record these has the following effects:
Assets are understated by $500 (< $500)
Liabilities are understated by $700 (< $700)
Net income is overstated by $200
b) Adjusting Journal Entries (AJEs) ensure that the accounts are up-to-date in accordance with the accrual concept of financial accounting. The accrual concept requires that transactions affecting a financial period must be reported in the affected period. This implies that expenses incurred must be recognized in the period they are incurred and not when cash is paid. Similarly, revenue earned must be recognized in the period they are earned and not when cash is received.
July 1 Purchased merchandise from Boden Company for $6,200 under credit terms of 2/15, n/30, FOB shipping point, invoice dated July 1. 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 $517. 3 Paid $105 cash for freight charges on the purchase of July 1. 8 Sold merchandise that had cost $1,500 for $1,900 cash. 9 Purchased merchandise from Leight Co. for $2,800 under credit terms of 2/15, n/60, FOB destination, invoice dated July 9. 11 Returned $800 of merchandise purchased on July 9 from Leight Co., and debited its account payable for that amount. 12 Received the balance due from Creek Co. for the invoice dated July 2, net of the discount. 16 Paid the balance due to Boden Company within the discount period. 19 Sold merchandise that cost $1,200 to Art Co. for $1,800 under credit terms of 2/15, n/60, FOB shipping point, invoice dated July 19. 21 Gave a price reduction (allowance) of $300 to Art Co. for merchandise sold on July 19, and credited Art's accounts receivable for that amount. 24 Paid Leight Co. the balance due, net of discount. 30 Received the balance due from Art Co. for the invoice dated July 19, net of discount. 31 Sold merchandise that cost $5,000 to Creek Co. for $7,100 under credit terms of 2/10, n/60, FOB shipping point, invoice dated July 31.
Prepare journal entries to record the following merchandising transactions of Blink Company, which applies the perpetual inventory system. (Round your answers to 2 decimal places.)
Answers
Answer:
July 1
Dr Merchandise Inventory$6,200
Cr Accounts Payable $6,200
July 2
Dr Accounts Receivable $900
Cr Sales $900
Dr Costs of Goods Sold $517
Cr Merchandise Inventory $517
July 3
Dr Merchandise Inventory $105
Cr Cash $105
July 8
Dr Cash $1,900
Cr Sales $1,900
Dr Cost of Goods Sold $1,500
Cr Merchandise Inventory $1,500
July 9
Dr Merchandise Inventory $2,800
Cr Accounts Payable$2,800
July 11
Dr Accounts Payable $800
Cr Merchandise Inventory $800
July 12
Dr Cash $882
Dr Sales Discounts-$18
Cr Accounts Receivable $900
July 16
Dr Accounts Payable $6,200
Dr Merchandise Inventory $124
Cr Cash $6,076
July 19
Dr Accounts Receivable $1,800
Cr Sales $1,800
Dr Cost of Goods Sold $1,200
Cr Merchandise Inventory $1,200
July 21
Dr Sales Returns and allowances $300
Cr Accounts Receivable $300
July 24
Dr Accounts Payable $2,000
Cr Merchandise Inventory $40
Cr Cash -$1,960
July 30
Dr Cash $1,470
Cr Sales discounts $30
Cr Accounts receivable $1,500
July 31
Dr Accounts receivable $7,100
Cr Sales $7,100
Dr Cost of Goods Sold $5,000
Cr Merchandise Inventory $5,000
Explanation:
Preparation of journal entries to record merchandising transactions of Blink Company
July 1
Dr Merchandise Inventory$6,200
Cr Accounts Payable $6,200
July 2
Dr Accounts Receivable $900
Cr Sales $900
Dr Costs of Goods Sold $517
Cr Merchandise Inventory $517
July 3
Dr Merchandise Inventory $105
Cr Cash $105
July 8
Dr Cash $1,900
Cr Sales $1,900
Dr Cost of Goods Sold $1,500
Cr Merchandise Inventory $1,500
July 9
Dr Merchandise Inventory $2,800
Cr Accounts Payable $2,800
July 11
Dr Accounts Payable $800
Cr Merchandise Inventory $800
July 12
Dr Cash $882
($900-$18)
Dr Sales Discounts-$18
(900x.02=$18 sales disc.)
Cr Accounts Receivable $900
(882+18)
July 16
Dr Accounts Payable $6,200
Dr Merchandise Inventory $124
(6,200x.02)
Cr Cash $6,076
($6,200-$124)
July 19
Dr Accounts Receivable $1,800
Cr Sales $1,800
Dr Cost of Goods Sold $1,200
Cr Merchandise Inventory $1,200
July 21
Dr Sales Returns and allowances $300
Cr Accounts Receivable $300
July 24
Dr Accounts Payable $2,000
($2,800-$800)
Cr Merchandise Inventory $40
($2,000*2%)
Cr Cash -$1,960
($2,000-$40)
July 30
Dr Cash $1,470
($1,500-$30)
Sales discounts $30
($1,500x.02)
Cr Accounts receivable $1,500
($1,800-$300)
July 31
Dr Accounts receivable $7,100
Cr Sales $7,100
Dr Cost of Goods Sold $5,000
Cr Merchandise Inventory $5,000
On January 1, 20X1, Como Company purchased 45% of the outstanding common shares of the Lite Company for $200,000. The net assets of Lite Company totaled $400,000. The inventory had a book value of $100,000 and a fair value of $120,000. Excess cost attributable to inventory is written off in 20X1. During 20X1, Lite Company earned $200,000 and declared a dividend of $40,000 for the year. The amount of the excess cost over book value attributable to inventory written off in 20X1 is: Multiple Choice $3,000. $7,500. $9,000. $4,500.
Answers
Answer:
C. $9,000
Explanation:
Cost of Inventory to Como company = $120,000 * 45%
Cost of Inventory to Como company = $54,000
Book value of Inventory attributable to Como company = $100,000 * 45%
Book value of Inventory attributable to Como company = $45,000
Excess of cost over book value which is written off in 20X1 is:
= Cost - Book value
= $54,000 - $45,000
= $9,000
Simone Company is considering the purchase of a new machine costing $50,000. It is expected to save $9,000 cash per year for 10 years, has an estimated useful life of 10 years, and no salvage value. Management will not make any investment unless at least an 18% rate of return can be earned. Using the net present value method, determine if the proposal is acceptable and Calculate the time-adjusted rate of return. Assume all tax effects are included in these numbers.
Answers
Answer:
Project not acceptable as NPV is negative at -$9,553.10Time-adjusted rate of return = 12.41%Explanation:
The Net Present value works by deducting the cost from the present value of benefits. If this amount is positive then the project is a good one.
= Present value of benefits - Present value of cost
Benefits are $9,000 a year for 10 years. This is constant so is annuity.
Cost is the $50,000 purchase price.
= (9,000 * Present value interest factor of annuity, 10 years, 18%) - 50,000
= (9,000 * 4.4941) - 50,000
= -$9,553.10
Project is not acceptable because NPV is negative.
Time-adjusted rate of return is the Internal Rate of Return which is the return that brings NPV to zero.
Use Excel or a Financial calculator for it(Worksheet attached):
= 12.41%
What is the answer i been trying this whole time.If you get it i'll give you 30 point honestly......
Answers
Answer:
GBGGPGGGGRGGGGGPGGGWG
Explanation:
Green trees = G
Blue trees = B
Pink trees = P
Red trees = R
Purple trees = P
White trees = W
Company Z is just starting to make a brand new product it has never made before. It has completed two units so far. The first unit took 19 hours to complete and the next unit took 15 hours. Based only on this information, what would be the estimate of the learning percentage in this process
Answers
Answer:
the learning percentage is 78.95%
Explanation:
The computation of the learning percentage is shown below;
= The next unit ÷ first unit
= 15 hours ÷ 19 hours
= 78.95%
We simply divided the two items with each other so that the correct percentage could arrive
hence, the learning percentage is 78.95%
a customer comes into your store and makes a large purchase, which she pays in full. Which of these should you provide to her? A. A receipt B. A purchase order C. An Installment plan D. An invoice
Answers
Answer:
A receipt
Explanation:
All the other choice wouldn't apply since layaway is a form of payment per month, installment plan has nothing to do with the question so that eliminated, and invoice and purchase order wouldn't be it since it wouldn't sound right
A customer enters in a shop and makes a substantial purchase, pay in whole then receipt in accounting shall be issued to that customer. Option A is correct.
What is a Receipt in Accounting?
An accounting document that a company gives to a customer as evidence of full or partial payment toward a good or service is known as a payment receipt, also known as a receipt for payment.
The following details regarding the transaction are commonly given on payment receipts: Business name.
Furthermore receipt contains details about your transaction, including the date, what you bought, how you paid, and how much you spent. If you paid sales tax, it is most likely also indicated on the receipt. Receipts serve as proof of the transaction. They give the seller crucial accounting and tax information.
Thus seller issue a cash receipt on receiving of full payment.
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Which are pathways in the Marketing, Sales, and Service career cluster? Select all that apply.
Marketing Information Management and Research
Marketing Communications and Promotion
Professional Sales and Marketing
Buying and Merchandising
Distribution and Logistics
E-Marketing
Management and Entrepreneurship
Software Design and Distribution
Answers
Answer:
All these apply
Marketing Information Management and Research
Marketing Communications and Promotion
Professional Sales and Marketing
Distribution and Logistics
E-Marketing
Explanation
Explanation:
All of the above mentioned choices fall in the pathways that come in the fields of Sales and Marketing. Marketing research is an important arena and so is the art of communicating and carrying out promotion tasks. Distribution is another big arena of sales and so is the trending field of E-Commerce where all these tools can be carried out online.
Marketing Information Management and Research, Marketing Communications and Promotion, Professional Sales and Marketing, Distribution and Logistics and E-Marketing.
What is E-Marketing?E-marketing, also known as digital marketing or online marketing, refers to the use of digital channels, such as the internet, social media, email, and mobile devices, to promote products or services and to engage with customers and prospects.
E-marketing provides businesses with a cost-effective way to reach a large audience and to engage with customers in real-time. Some of the most common e-marketing tactics include search engine optimization (SEO), pay-per-click (PPC) advertising, content marketing, social media marketing, email marketing, and mobile marketing.
Overall, e-marketing has become an essential component of modern marketing strategies as it provides businesses with a powerful way to reach and engage with customers in an increasingly digital world.
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XYZ Insurance Company uses class rating to determine the rate to charge for insurance.
For one type of insurance the pure premium XYZ actuaries calculated is $75 per unit.
If XYZ's expense ratio is 30%, what is the gross rate for this coverage?
O a. $107.14
O b. $96.28
O C. $85.19
O d. $115.62
Answers
Answer: a. $107.14
Explanation:
The gross rate for insurance coverage represents the amount that the insurance provider needs to pay for losses as well as the amount needed to pay for expenses such as sales expenses and still be able to have a profit.
Given the expense ratio and the pure premium is:
= Premium / ( 100 - expense ratio)
= 75 / (100 - 30%)
= $107.14
If you have PhP 5,000.00, which of the following investment alternatives would provide the greatest ending wealth for your one-year investment?
7/10 percent compounded annually
7/10 percent compounded semi-annually
72/100 percent simple interest
7/10 percent compounded quarterly
NO FILES AND CHAIN MESSAGE OR ELSE I'LL REPORT YOUR ACCOUNT.
Answers
Answer:
7/10 percent compounded quarterly
Explanation:
The formula for calculating future value:
FV = P (1 + r/m)^mn
m = number of compounding
FV = Future value
P = Present value
R = interest rate
N = number of years
Simple interest = principal x time x interest rate
1. 5000 x (1.007) = 5035
2. 5000 x (1 + 0.007/2)^2 = 5035.06
5000 x (1 + 0.007/4)^4 = 5035.09
Select the correct answer from each drop-down menu.
What techniques can you use to control inventory costs?
(economic order, Just in time, Carrying) ______ quantity indicates the minimum quantity of goods to reach before reordering inventory.
(Reliable Stock, Safety Stock, Scheduled Stock) _____ is the quantity of goods to keep as a buffer to utilize in times of emergency.
Answers
Answer:
First one: Economic Order; Second One: Safety Stock
Explanation:
I know the second one's right because it frequently shows up on PLATO modules for business. The first one is economic order according to investopedia.com. I looked up both carrying quantity and just in time quantity, too-- it seems as carrying quantity isn't a thing, and just in time quantity focuses on decreasing waste. See my comments on your question for quotes from the source.
Hope this helps you!!
Jiminy's Cricket Farm issued a 30-year, 6.5 percent semiannual bond 9 years ago. The bond currently sells for 108.5 percent of its face value. The book value of this debt issue is $151 million. In addition, the company has a second debt issue, a zero coupon bond with 13 years left to maturity; the book value of this issue is $97 million, and it sells for 62.4 percent of par. The company’s tax rate is 21 percent.
1) what is the total book value of debt?
2) what is the total market value of debt?
3) what is the after tax cost of the 6.5 percent coupon bond?
4) what is the after tax cost of the zero coupon bond?
5) What is the after tax cost of debt?
Answers
Answer:
1 151 million 2 97 million
3 22.785 million 4 20.37 million 5 76.63 million
A customer has requested that Lewelling Corporation fill a special order for 2,200 units of product S47 for $38 a unit. While the product would be modified slightly for the special order, product S47's normal unit product cost is $16.90:
Direct materials $ 4.60
Direct labor $ 4.00
Variable manufacturing overhead $ 1.70
Fixed manufacturing overhead $ 6.60
Unit product cost $ 16.90
Assume that direct labor is a variable cost. The special order would have no effect on the company's total fixed manufacturing overhead costs. The customer would like modifications made to product S47 that would increase the variable costs by $1.90 per unit and that would require an investment of $16,000.00 in special molds that would have no salvage value. This special order would have no effect on the company's other sales. The company has ample spare capacity for producing the special order. The annual financial advantage (disadvantage) for the company as a result of accepting this special order should be:_________
a) $40,760
b) ($15,700)
c) $16,200
d) ($2,000)
Answers
Petty Cash Fund Entries
Journalize the entries to record the following:
Check No. 12-375 is issued to establish a petty cash fund of $500.
The amount of cash in the petty cash fund is now $40. Check No. 12-476 is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $212; miscellaneous selling expense, $156; miscellaneous administrative expense, $61. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $500, record the discrepancy in the cash short and over account.)
Petty Cash Fund Entries
Journalize the entries to record the following:
Check No. 12-375 is issued to establish a petty cash fund of $500.
The amount of cash in the petty cash fund is now $40. Check No. 12-476 is issued to replenish the fund, based on the following summary of petty cash receipts: office supplies, $212; miscellaneous selling expense, $156; miscellaneous administrative expense, $61. (Because the amount of the check to replenish the fund plus the balance in the fund do not equal $500, record the discrepancy in the cash short and over account.)
a. Journalize the entry to establish the petty cash fund. If an amount box does not require an entry, leave it blank.
b. Journalize the entry to replenish the petty cash fund. If an amount box does not require an entry, leave it blank.
Answers
Answer:
A. Dr Petty cash fund $500
Cr Cash $500
B. Dr Office supplies expenses $212
Dr miscellaneous selling expense $156
Dr miscellaneous administrative expense $61
Dr Cash short and over 31
Cr Petty cash fund $460
Dr Petty cash fund $460
Cr Cash $460
Explanation:
A. Preparation of the journal entry to establish the petty cash fund.
Dr Petty cash fund $500
Cr Cash $500
(To establish the petty cash fund)
B. Preparation of the journal entry to replenish the petty cash fund.
Dr Office supplies expenses $212
Dr miscellaneous selling expense $156
Dr miscellaneous administrative expense $61
Dr Cash short and over 31
($500-$212+$156+61+$40)
Cr Petty cash fund $460
($212+$156+$61+$31)
(To replenish the petty cash fund)
Dr Petty cash fund $460
($212+$156+$61+$31)
Cr Cash $460
FINANCIAL LITERACY
WILL MARK BRAINLIEST PLS HELP ASAP!!
Answers
Answer:
i dk
Explanation:
tthanks for the points tho
In a closed economy, saving and investment must be equal, but this is not the case in an open economy. In the following problem, you will explore how saving and investment are connected to the international flow of capital and goods in an economy. Before delving into the relationship between these various components of an economy, you will be asked to recall some relationships between aggregate variables that will be useful in your analysis.
Recall the components that makeup GDP. National income (Y) equals total expenditure on the economy's output of goods and services. Thus, where C= consumption, I= investment, G =government purchases, X=exports, M =imports, and NX= net exports.
Y= _____
Also, national saving is the income of the nation that is left after paying for _____. Therefore, national saving (S) equals:
S=_____
Rearranging the previous equation and solving for Y yields, Y= _____ Plugging this into the original equation showing the various components of GDP results in the following relationship:
S=_____
Answers
Answer:
Y = C + I + G + NX
S = Y - C
S = I + G + NX
Explanation:
National Income Y = C + I + G + NX ; {where consumption, investment, government purchases, net exports ie exports - imports are corresponding expenditure of households, firms, government, rest of the world}
National Saving (S) is income (Y) left after paying for consumption (C) . So, S = Y - C
Using above equations, Y = C + S , Y = C + I + G + NX
C + S = C + I + G + NX
So, S = I + G + NX
Lamping, Inc., is considering the purchase of a machine that would cost $520,000 and would last for 7 years, at the end of which, the machine would have a salvage value of $52,000. The machine would reduce labor and other costs by $112,000 per year. Additional working capital of $6,000 would be needed immediately, all of which would be recovered at the end of 7 years. The company requires a minimum pretax return of 14% on all investment projects. (Ignore income taxes).
Required:
Determine the net present value of the project.
Answers
Answer:
Lamping, Inc.
The net present value of the project is:
= ($22,544)
Explanation:
a) Data and Calculations:
Cost of machine = $520,000
Useful life of machine = 7 years
Salvage value = $52,000
Cost savings = $112,000 per year
Initial working capital $6,000
Recovered working capital = $6,000
Minimum required pretax return = 14%
PV of initial costs = $526,000 ($520,000 + $6,000)
PV of costing savings (annuity) = $480,256 ($112,000 * 4.288)
PV of salvage and recovered working capital = $23,200 ($58,000 * 0.400)
Total savings/benefits = $503,456 ($480,256 + $23,200)
NPV = ($22,544)
a manufacturing company has a beginning finished goods inventory of 15,100, raw material purchases of 18,500, cost of goods manufactured of 33,500 and an ending finished goods inventory of 18,300. the cost of goods sold for this company is
Answers
Answer:
$30,300
Explanation:
cost of goods sold = opening inventory + cost of goods manufactured - closing inventory
= $15,100 + $33,500 - $18,300
= $30,300
The cost of goods sold for this company is $30,300
Pepper Corporation owns 75 percent of Salt Company's voting shares. During 20X8, Pepper produced 50,000 chairs at a cost of $79 each and sold 35,000 chairs to Salt for $90 each. Salt sold 18,000 of the chairs to unaffiliated companies for $117 each prior to December 31, 20X8, and sold the remainder in early 20X9 to unaffiliated companies for $130 each. Both companies use perpetual inventory systems. Based on the information given above, what amount of cost of goods sold must be reported in the consolidated income statement for 20X8?
a. $2,765,000
b. $1,620,000
c. $1,422,000
d. $2,963,000
Answers
Answer: c. $1,422,000
Explanation:
The Cost of Goods that goes into the Consolidated income statement would be the goods that were sold to unaffiliated companies. The original cost of production would apply:
= Quantity sold to unaffiliated companies in 20X8 * Cost for Pepper
= 18,000 * 79
= $1,422,000
IntelAir Present Value
You are an investment bank intern and your first job is to help with an acquisition project. Your client, Purifier, is an industry leader in the air conditioning business. Recently, Purifier approached your investment bank and expressed its interests in acquiring a start-up called IntelAir. Your project manager assigned you the task of evaluating this acquisition. After one week of research, you gathered the following information about IntelAir.
IntelAir was founded two years ago by a few college dropouts. IntelAir has developed a proprietary temperature sensor antenna and a patented air purifying system. Purifier thinks that acquiring IntelAir will bring valuable economic synergies and expand Purifier’s market share.
IntelAir has signed contracts with several temperature sensor companies to deliver its antenna. The contract specifies that over the next ten years (years 1 to 10), IntelAir would deliver their most up-to-date sensor antennas for $1000/unit. The yearly order volume is 5000 units for a total revenue of $5,000,000. After 10 years, IntelAir anticipates that there will be no more demand for antenna due to landscape changes in the technology space.
The all-inclusive cost of sensor production is $700/unit. However, IntelAir expects that in year 5, there will be a major technology upgrade. IntelAir will incur a one-time upgrading expense in year five, which is not included in the previous all-inclusive cost. The upgrading expense is $800,000.
Also, Purifier intends to sell the air purifying system patent one year after the acquisition (year 1). The patent’s expected selling price is $2,000,000.
Purifier currently uses a discount rate of 10%.
What is the maximum Purifier should pay for IntelAir? (please use two decimal digits in your answer)
Answers
Answer:
IntelAir Present Value
The maximum amount that Purifier should pay for IntelAir is:
= $10,538,700.00.
Explanation:
a) Data and Calculations:
Value of InterlAir:
Annual Sales Revenue = $5,000,000 ($1,000 * 5,000 units)
Annual all-inclusive cost = 3,500,000 ($700 * 5,000 units)
Net annual cash inflow = $1,500,000 ($300 * 5,000 units)
Year 1, Cash inflow from the sale of patent of the air purifying system = $2,000,000
Year 5 Technology upgrading expense = $800,000
Discount rate = 10%
Duration = 10 years
Annuity Factor for 10 years at 10% = 6.145
PV factor at Year 1 at 10% = 0.909
PV factor at Year 5 at 10% = 0.621
Present value of Cash inflows:
Net annual cash inflow $1,500,000 for 10 years at 6.145 = $9,217,500
Year 1 Sale of patent for $2,000,000 at 0.909 = 1,818,000
Year 5 Technology upgrade for $800,000 at 0.621 = (496,800)
Present value of IntelAir = $10,538,700
FIN issues a $1000 par value bond that pays 7 precent annula interest and will mature in 14 years. The current market price for the bond is $950. Flotation costs will be 14 percent of market price. The company's marginal tax rate is 25%. What will be FIN's aafter tax cost of debt? g
Answers
Answer:
7.05 %
Explanation:
After tax cost of debt = interest x ( 1 - tax rate)
so, the initial step is to determine the interest rate :
The Bond Yield (i/yr) presents the market rate and this is what we want for our interest rate.
thus,
PV = - [$950 - ($950 x14%)] = - $817(remove floatation cost from market price)
FV = $1000
PMT = $1000 x 7 % = $70.00
P/YR = 1
N = 14
i/yr = ??
Using a financial calculator to input the values as above, the Bond Yield (i/yr) will be 9.40 %
therefore,
After tax cost of debt = 9.40 % x (1 - 0.25)
= 7.05 %
Stockholders' Equity: Transactions and Balance Sheet Presentation Torey Corporation was organized on April 1. with an authorization of 25,000 shares of six percent, $50 par value preferred stock and 200,000 shares of $5 par value common stock. During April, the following transactions affecting stockholders' equity occurred:
Apr. 1 Issued 80,000 shares of common stock at 540 cash per share:
3 Issued 2,000 shares of common stock to attorneys and promoters in exchange for their services in organizing the corporation. The services were valued at 3 531,000
8 Issued 3,000 shares of common stock in exchange for equipment with a fair market value of $55,000
20 Issued 6,000 shares of preferred stock for cash at $80 per share.
Required :
a. Prepare journal entries to record the above transactions.
b. Prepare the stockholders' equity section of the balance sheet at April 30.
Answers
Answer:
a. See the journal entries below.
b. Stockholders' equity = $3,766,000
Explanation:
Note: There are little errors in this question where dollar signs are used as figures. These are however corrected before answering the question. The complete question with the correction is therefore presented as follows:
Stockholders' Equity: Transactions and Balance Sheet Presentation Torey Corporation was organized on April 1. with an authorization of 25,000 shares of six percent, $50 par value preferred stock and 200,000 shares of $5 par value common stock. During April, the following transactions affecting stockholders' equity occurred:
Apr. 1 Issued 80,000 shares of common stock at $40 cash per share:
3 Issued 2,000 shares of common stock to attorneys and promoters in exchange for their services in organizing the corporation. The services were valued at $31,000
8 Issued 3,000 shares of common stock in exchange for equipment with a fair market value of $55,000
20 Issued 6,000 shares of preferred stock for cash at $80 per share.
Required :
a. Prepare journal entries to record the above transactions.
b. Prepare the stockholders' equity section of the balance sheet at April 30.
Explanation of the answers is now given as follows:
a. Prepare journal entries to record the above transactions.
Let APIC represents additional paid in capital, the journal entries can be prepared as follows:
Date Particulars Dr ($) Cr ($)
Apr. 1 Cash (80,000 * $40) 3,200,000
Common stock (80,000 * $5) 400,000
APIC - Common stock 2,800,000
(To record common stock issued in excess of par value.)
Apr. 3 Attorney and promoters service exp. 31,000
Common stock (2,000 * $5) 10,000
APIC - Common stock 21,000
(To record common stock issued to attorneys and promoters for services at a premium.)
Apr. 8 Equipment (Fair value) 55,000
Common stock (3,000 * 5) 15,000
APIC - Common stock 40,000
(To record common stock issued for equipment at a premium.)
Apr. 20 Cash (6,000 * $80) 480,000
Preferred stock (6,000 * $50) 300,000
APIC - Preferred stock 180,000
(To record preferred stock issued in excess of par value.)
b. Prepare the stockholders' equity section of the balance sheet at April 30.
Using the figures from the journal entries above, this can be prepared as follows:
Torey Corporation
Stockholders' Equity Section of the Balance Sheet
At April 30.
Details Amount ($)
Common stock ($400,000 + $10,000 + $15,000) 425,000
Preferred stock 300,000
APIC - Common stock ($2,800,000 + $21,000 + $40,000) 2,861,000
Additional paid in capital - Preferred stock 180,000
Stockholders' equity 3,766,000
a. Prepare journal entries to record the above transactions.
Date Particulars Dr ($) Cr ($)
Apr. 1 Cash (80,000 * $40) 3,200,000
Common stock (80,000 * $5) 400,000
APIC - Common stock 2,800,000
(To record common stock issued in excess of par value.)
Apr. 3 Attorney and promoters service exp. 31,000
Common stock (2,000 * $5) 10,000
APIC - Common stock 21,000
(To record common stock issued to attorneys and promoters for services at a premium.)
Apr. 8 Equipment (Fair value) 55,000
Common stock (3,000 * 5) 15,000
APIC - Common stock 40,000
(To record common stock issued for equipment at a premium.)
Apr. 20 Cash (6,000 * $80) 480,000
Preferred stock (6,000 * $50) 300,000
APIC - Preferred stock 180,000
(To record preferred stock issued in excess of par value.)
b. Prepare the stockholders' equity section of the balance sheet at April 30.
Torey Corporation
Stockholders' Equity Section of the Balance Sheet on April 30
Details Amount ($)
Common stock ($400,000 + $10,000 + $15,000) 425,000
Preferred stock 300,000
APIC - Common stock ($2,800,000 + $21,000 + $40,000) 2,861,000
Additional paid in capital - Preferred stock 180,000
Stockholders' equity 3,766,000
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Journalize the following transactions, using the allowance method of accounting for uncollectible receivables
Mar. 17: Received $2,700 from Keith MacPhearson and wrote off the remainder owed of $6,370 as uncollectible.
Mar. 17 July 29: Reinstated the account of Keith MacPhearson and received $6,370 cash in full payment.
Answers
Answer:
Journal entry
Date Account & Explanation Debit Credit
Mar 17. Cash $2,700
Allowance for doubtful accounts $6370
Account receivable $9,070
Jul 29 Account receivable $6,370
Allowance for doubtful accounts $6,370
(To record amount reinstated)
Cash $6,370
Account receivable $6,370
(To record amount received)
One out of every ten jobs falls into the marketing category.
True
False
Answers
Answer:
true
Explanation:
one out of every ten jobs falls into the marketing category