Answer:
Dr Manufacturing equipment $1,430,0000
Cr Common stock $2,000
Cr Paid-in capital in excess of par value $1,428,000
Explanation:
The equipment account would be debited with $1,430,000 as an increase in assets.
The common stock account would be credited with the par value of 100,000 stocks which is $2,000($0.02*100,000) while balance of $1,428,000($1,430,000-$2000) is credited to paid-in capital in excess pf par value
Which of the following is not considered a legitimate expense of a partnership? a Interest paid to partners based on the amount of invested capital. b Depreciation on assets contributed to the partnership by partners. c Salaries for management hired to run the business d Supplies used in the partners' offices.
Answer:
a Interest paid to partners based on the amount of invested capital.
Explanation:
A partnership is formed between two parties that agree to go into a venture for mutual gain. The parties share ownership of the business entity and as such are entitled to profit from their equity holdings.
Interest paid based on invested capital is considered a distribution of profit by the business and not an expense. This is similar to sharing profit to shareholders in a company.
Legitimate expenses include: cost of sales, staff cost, administrative costs, advertising costs, and professional expenses like hiring an accountant.
Out of all the options listed, the one that is not considered a legitimate expense in a partnership is a. Interest paid to partners based on the amount of invested capital.
Some legitimate expenses in a partnership are:
Asset depreciation in the business Supplies used by the partners Salaries paid to management staffInterest on invested capital is not considered an expense and is only realized after the calculation of profit.
In conclusion, interest on partnership capital is not an expense.
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The effects of tariffs and quotas are: a(n) __________ in the prices of imported goods to domestic consumers, and a(n) __________ in imports.
Answer:
Increase
Reduction
Explanation:
A tariff is a tax on import or export of goods and services.
Tariffs increases the prices of products and thus reduce the amount of imports.
Quotas is when the government or an agency of the government limits the amount of goods and services that can be imported or exported.
Due to the reduced inflow of goods due to quotas, the price of goods imported would rise.
I hope my answer helps you
At the beginning of the year, paid-in capital was $164 and retained earnings was $94. During the year, the stockholders invested $48 and dividends of $12 were declared and paid. Retained earnings at the end of the year were $104.
Net income for the year was:_______
Answer:
$22
Explanation:
From the question above, the paid in capital at the beginning of a year was $164
Retained earnings was $94
During the year the amount invested by stockholders was $48 and a dividend of $12 was declared and paid.
At the end of the year the retained earnings was $104
Therefore, the net income for the year can be calculated as follows
Net income= Retained earnings at the end of the year-retained earnings at the beginning of the year+dividend
Net income= $104-$94+$12
= $22
Hence the net income for the year was $22
After researching the different forms of business organization, Natalie Koebel decides to operate "Cookie Creations" as a corporation. She then starts the process of getting the business running. In November 2015, the following activities take place.
A. Natalie cashes her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account.
B. She opens a bank account under the name "Cookie Creations" and transfers $500 from her personal account to the new account in exchange for common stock.
C. Natalie pays $65 to have advertising brochures and posters printed. She plans to distribute these as opportunities arise.
D. She buys baking supplies, such as flour, sugar, butter, and chocolate chips, for $125 cash.
E. Natalie starts to gather some baking equipment to take with her when teaching the cookie classes. She has an excellent top-of-the-line food processor and mixer that originally cost her $750. Natalie decides to start using it only in her new business. She estimates that the equipment is currently worth $300. She invests the equipment in the business in exchange for common stock.
F. Natalie realizes that her initial cash investment is not enough. Her grandmother lends her $2,000 cash, for which Natalie signs a note payable in the name of the business. Natalie deposits the money in the business bank account. (Hint: The note does not have to be repaid for 24 months. As a result, the notes payable should be reported in the accounts as the last liability and also on the balance sheet as the last liability.)
G. She buys more baking equipment for $900 cash.
H. She teaches her first class and collects $125 cash.
I. Natalie books a second class for December 4 for $150. She receives $30 cash in advance as a down Natalie pays $1,320 for a one-year insurance policy that will expire on December 1, 2016.
(a) Prepare journal entries to record the November transactions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
(b) Post the journal entries to general ledger accounts.
(c) Prepare a trial balance at November 30.
Answer:
ANatalie cashes her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account.
Natalie cashes her U.S. Savings Bonds and receives $520, which she deposits in her personal bank account.
You find that the bid and ask prices for a stock are $14.25 and $15.45, respectively. If you purchase or sell the stock, you must pay a flat commission of $30. If you buy 100 shares of the stock and immediately sell them, what is your total implied and actual transaction cost in dollars
Answer:
$180
Explanation:
The bid price of a stock is $14.25
The ask-price of a stock is $15.45
A flat commission of $30 must be paid in the stock
100 shares of stock are bought
Therefore, the total implied and actual transaction costs can be calculated as follows
= Commission+(ask price-bid price)×number of shares
= 30×2+($15.45-$14.25)×100
= 60+ 1.2×100
= 60+120
= $180
Hence the total implied and actual transaction cost is $180
If 200,000 machine‐hours are budgeted for variable overhead at a standard rate of $5/machine‐hour, but 220,000 machine‐hours were actually used at an actual rate of $6/machine‐hour, what is the variable overhead efficiency variance?
Answer:
Variable overhead efficiency variance= $100,000 unfavorable
Explanation:
Giving the following information:
200,000 machine‐hours are budgeted for variable overhead at a standard rate of $5/machine‐hour, but 220,000 machine‐hours were used.
To calculate the variable overhead efficiency variance, we need to use the following formula:
Variable overhead efficiency variance= (Standard Quantity - Actual Quantity)*Standard rate
Variable overhead efficiency variance= (200,000 - 220,000)*5
Variable overhead efficiency variance= $100,000 unfavorable
When the Variable overhead efficiency variance is = $100,000 unfavorable
What is the Efficiency variance?
Giving the following information are:
200,000 machine‐hours are budgeted for variable overhead at a standard rate of $5/machine‐hour, but [tex]220,000[/tex] machine‐hours were used. Now we calculate the variable overhead efficiency variance, Then we need to use the following formula are below mention. The variable overhead efficiency variance is= (Standard Quantity - Actual Quantity)*Standard rate. Then Variable overhead efficiency variance= [tex](200,000 - 220,000)*5[/tex]
Thus, Variable overhead efficiency variance= $100,000 unfavorable
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Way Cool produces two different models of air conditioners. The company produces the mechanical systems in their components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow. (Round your intermediate calculations and round "Cost per unit and OH rate" answers to 2 decimal places.) Process Activity Overhead Cost Driver QuantityComponents Changeover $ 459,500 Number of batches 810 Machining 301,600 Machine hours 7,680 Setups 227,500 Number of setups 80 $ 988,600 Finishing Welding $ 180,500 Welding hours 4,900 Inspecting 222,000 Number of inspections 815 Rework 60,700 Rework orders 230 $ 463,200 Support Purchasing $ 135,500 Purchase orders 525 Providing space 31,550 Number of units 4,800 Providing utilities 60,110 Number of units 4,800 $ 227,160 Additional production information concerning its two product lines follows. Model 145 Model 212Units produced 1,600 3,200 Welding hours 2,000 2,900 Batches 405 405 Number of inspections 485 330 Machine hours 2,280 5,400 Setups 40 40 Rework orders 130 100 Purchase orders 350 175 Required:1. Using a plantwide overhead rate based on machine hours, compute the overhead cost per unit for each product line.2. Determine the total cost per unit for each products line if the direct labor and direct materials costs per unit are $200 for Model 145 and $130 for Model 212.Overhead Assigned Activity Driver Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unitModel 145 Model 212 Model 145 Model 212 3. Assume if the market price for Model 145 is $732 and the market price for Model 212 is $490, determine the profit or loss per unit for each model. Model 145 Model 212 Market price
Answer:
Way Cool:
1. Overhead cost per unit for each product line:
Model 145 Model 212
Machine hours 2,280 5,400
Numbers of units 1,600 3,200
Total costs $498,441.25 $1,180,518.75
Overhead cost
per unit $311.53 $368.91
2. Total cost per unit if the direct labor and direct materials costs per unit are $200 for Model 145 and $130 for Model 212
Model 145 Model 212
Overhead cost
per unit $311.53 $368.91
Direct material &
labor cost per unit $200.00 $130.00
Total cost per unit $511.53 $498.91
3. Determination of profit or loss per unit if market price for Model 145 is $732 and $490 for Model 212:
Model 145 Model 212
Sales price $732.00 $490.00
Cost of sales $511.53 $498.91
Profit (Loss) per unit $220.47 ($8.91)
Explanation:
a) Data and Calculations:
Process Activity Overhead Driver Quantity Plant Wide Rate
Components C/over 459,500 No. of batches 810 $567.28
Machining 301,600 M. hours 7,680 $39.27
Setups 227,500 No. of setups 80 $2,843.75
Sub-Total $988,600
Finishing welding 180,500 Welding hours 4,900 $36.84
Inspecting 222,000 Number of
inspections 815 $272.39
Rework 60,700 Rework orders 230 $263.91
Sub-Total $463,200
Support Purchasing 135,500 Purch. orders 525 $258.10
Providing space 31,550 No. of units 4,800 $6.57
Providing utilities 60,110 No. of units 4,800 $12.52
Sub-Total $ 227,160
Total overhead $1,678,960
Additional production information concerning its two product lines follows.
Model 145 Model 212 Total
Units produced 1,600 3,200 4,800
Welding hours 2,000 2,900 4,900
Batches 405 405 810
Number of inspections 485 330 815
Machine hours 2,280 5,400 7,680
Setups 40 40 80
Rework orders 130 100 230
Purchase orders 350 175 525
b) Calculation of Plantwide overhead rate based on machine hours:
Total overhead costs/machine hours = $1,678,960/7,680
= $218.6146 per machine hour
c) Activity Based Costing system is a system that accumulates and allocates production or service costs based on the activities undertaken for the production or service. The activities are regarded as the cost drivers and therefore better bases for accumulating and allocating costs.
You purchased a share of SPCC for $100 and expect to receive a dividend of $5 in one year. If you expect the price after the dividend is paid to be $110, what total return will you have earned over the year
Answer:
The answer is 15%
Explanation:
(P1 - Po) / Po + D
Where P1 is the price of the share at the end of the year
Po is the price of the share at the beginning of the year
D is the Dividend receceived
P1 is $110
Po is $100
And Dividend is 5%
($110 - $100) / $100 + 5 %
$10/100 + 5%
10% + 5%
= 15%
The total return will you have earned over the year for the purchase of a share of SPCC is 15%
A company traded an old forklift for a new forklift, receiving a $10,500 trade-in allowance and paying the remaining $37,200 in cash. The old forklift cost $39,000 and straight-line accumulated depreciation of $27,200 had been recorded as of the exchange date under the assumption it would last five years and have a $5,000 salvage value. a. What was the book value of the old forklift on the date of the exchange
Answer: $11,800
Explanation:
The Book Value is calculated as the Cost price less the accumulated depreciation on the asset.
Book Value of old forklift = Asset Cost - Accumulated Depreciation
Book Value of old forklift = 39,000 - 27,200
Book Value of old forklift = $11,800
​A restaurant, which operates in a perfectly competitive market, is evaluating whether it should serve breakfast on a daily basis. It would choose to do this when its revenues cover its variable costs. True or False
Answer:
TRUE
Explanation:
A perfect competition is characterised by many buyers and sellers of homogeneous goods and services. Market prices are set by the forces of demand and supply. There are no barriers to entry or exit of firms into the industry.
In the long run, firms earn zero economic profit. If in the short run firms are earning economic profit, in the long run firms would enter into the industry. This would drive economic profit to zero.
Also, if in the short run, firms are earning economic loss, in the long run, firms would exit the industry until economic profit falls to zero.
In the short run, the firm would continue to operate if its revenue covers variable cost. if it doesn't it would shut down.
The following table gives the number of pints of type A blood used at Damascus Hospital in the past 6 weeks:
Week Of Pints Used
31-Aug 350350
7-Sep 389389
14-Sep 408408
21-Sep 383383
28-Sep 368368
5-Oct 378378
Required:
The forecasted demand for the week of October 12 using a3-week moving average is:______
Answer:
The forecasted demand for the week of October 12 using a 3-week moving average is 376,710
Explanation:
a) Data
21-Sep 383,383
28-Sep 368,368
5-Oct 378,378
Total 1,130,129
Average = 1,130,129/3 = 376,710
b) To calculate the moving average, the quantities for three weeks' demand are added and divided by 3. This shows that the average demand for type A blood at the Damascus Hospital will be 376,710, going by the figures provided. If the correct figures should have been 383, 368, and 378, the average would have equal to 376 pints.
The above values represent a PPF of production for one day's work. What is the opportunity cost of producing the first two pounds of beets
Answer:
The values that the question is making reference to are these:
Carrots Beets
(Pounds) (Pounds)
0 6
5 4
10 2
15 0
What is the opportunity cost of producing the first two pounds of beets
The opportunity cost is what is given up to do something instead. In this case, the opporutnity cost is the amount of carrots that are not produced when choosing to produce beets instead.
As we can see from the table, if we produce 0 pounds of beets, we can produce 15 pounds of carrots. However, if we decide to produce the first 2 pounds of beets, we can only produce 10 pounds of carrots.
These 5 pounds of carrots that we cannot produce anymore, is the opportunity cost.
Knowledge Check 01 Cartier Corporation currently sells its products for $50 per unit. The company’s variable costs are $20 per unit. Fixed expenses amount to a total of $5,000 per month. What is the company’s contribution margin ratio?
Answer:
Contribution margin ratio = 0.6 or 60%
Explanation:
The contribution margin per unit is the amount that each unit contributes to covering the total fixed costs. It is the contribution of each unit towards fixed costs after deducting the variable costs per unit from the selling price per unit.
The contribution margin ratio is the unit contribution margin expressed as a percentage of the selling price per unit.
Contribution margin ratio = Contribution margin per unit / Selling price per unit
Where,
Contribution margin per unit = Selling price per unit - Variable cost per unit
Contribution margin per unit = 50 - 20 = $30
Contribution margin ratio = 30 / 50 = 0.6 or 60%
Managers in international businesses will need to evaluate the attractiveness of a country as a market or location for a facility or investment. Knowing how to think about events and situations will help the manager make that evaluation.
Managers can use economic and socioeconomic indicators to evaluate potential locations to conduct business
Mathc the Economic indicator to the relevant dimensions.
a. Income distribution
b. Unit labor costs
c. Private consumption
d. Age distribution
e. Gross national income (GNI)
f. Economic growth rate
g. Total population
1. Absolute size of an economy
2. Speed of economic growth
3. How a nation's income is apportioned
4. Purchase of essential vs, nonessential goods
5. Cost of production
6. Potential market size
7. Potential market segments
Answer:
1. Absolute size of an economy
e. Gross national income (GNI)
2. Speed of economic growth
f. Economic growth rate
3. How a nation's income is apportioned
a. Income distribution
4. Purchase of essential vs, nonessential goods
c. Private consumption
5. Cost of production
b. Unit labor costs
6. Potential market size
g. Total population
7. Potential market segments
d. Age distribution
Explanation:
Any entity that wishes to exploit foreign markets must of necessity determine the suitability of the country's market and its economy. To achieve this aim, entities engaging in foreign direct investments consider some factors. One of them is the country's attractiveness. A country is attractive or not depending on the following elements, among others: market size, growth of market size, per capita income, population and age distribution, existence and enforcement of contract laws, and political openness. These considerations are important to avoid regrets, including over-exposure to country risks.
Which one of the following is not a factor that influences a business's control environment? a. personnel policies b. management's philosophy and operating style c. organizational structure d. proofs and security measures
Answer:
d. Proofs and security measures.
Explanation:
A business control environment are those policies and procedures that assist management in directing the business operations towards achieving it's goals. The aim is to protect the company's assets from misuse by member of staff and also ensure that the business information is accurate and up to date.
Top management create a business control environment to ensure that the policies and procedures guiding each business units are adhered to by members of staff. A business control environment otherwise known as internal control is influenced by it's personnel policies, Management's philosophy and operating style and also it's organizational structure.
Stormer Company reports the following amounts on its statement of cash flow: Net cash provided by operating activities was $35,500; net cash used in investing activities was $13,000 and net cash used in financing activities was $16,500. If the beginning cash balance is $6,500, what is the ending cash balance
Answer:
The answer is $38,500
Explanation:
Operating activities: Cash generated or used to run the day-to-day business operations.
Investing activities: Cash used for investing in assets like securities, bonds, equipment, or proceeds from these assets.
Financing activities: Cash generated from loan and/or payments made to reduce loan balances
Ending cash balance = Net Cash from operating activities + net cash from investing activities - net caash from financing activities + Beginning cash balance
Ending cash balance = $35,500 + $13,000 - $16,500 + $6,500
$38,500
A waiter fills your water glass with ice water (containing many ice cubes) such that the liquid water is perfectly level with the rim of the glass. As the ice melts,
Answer:
As the ice melts and turns into water, the level of the liquid water will lower and it will no longer be perfectly leveled with the rim of the glass. This happens because water has a unique property, its solid state occupies a larger volume than its liquid state, i.e. as waters turns into ice, it expands and occupies more space. Generally, as liquids become solid, they will shrink and occupy less space, but that doesn't happen with water.
Explanation:
Determinants of the price elasticity of demand
Consider some determinants of the price elasticity of demand:
1. The availability of close substitutes
2. Whether the good is a necessity or a luxury
3. How broadly you define the market
4. The time horizon being considered
A good with many close substitutes is likely to have relatively demand, since consumers can easily choose to purchase one of the close substitutes if the price of the good rises.
A good’s price elasticity of demand depends in part on how necessary it is relative to other goods. If the following goods are priced approximately the same, which one has the least elastic demand?
A heart valve for heart attack victims
Diamond necklace
The price elasticity of demand for a good also depends on how you define the good.
Organize the goods found in the following table by indicating which is likely to have the most elastic demand, which is likely to have the least elastic demand, and which will have demand that falls in between.
Categories Most Elastic In Between Least Elastic
Red bell peppers
Vegetables
Food
The price elasticity of demand is also affected by the given time horizon.
Other things being equal, the demand for natural gas will tend to be elastic in the short run than in the long run.
Answer:
Elastic
A heart valve for heart attack victims
Red bell peppers - least elastic
Vegetables - in between
Food - most elastic
less elastic
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.
Demand is inelastic if a small change in price has little or no effect on quantity demanded.
a good that is considered a necessity usually has a less elasticity of demand.
the more narrowly defined a good is, the less elastic demand is. for example, there are many substitutes for food because it is largely defined, so its elasticity of demand would be more elastic
in the short run, demand is usually less elastic because there is a short time to find suitable substitutes. but in the long run, consumers have enough time to find suitable substitutes so demand is usually more elastic
Use the following information . On January 1, 2018, Dennis Company purchased land for an office site by paying $540,000 cash. Dennis began construction on the office building on Jan 1. The following expenditures were incurred for construction: Date Expenditures January 1, 2018 $ 360,000 April 1, 2018 504,000 May 1, 2018 900,000 June 1, 2018 1,440,000 The office was completed and ready for occupancy on July 1st of the following year. To help pay for construction, $720,000 was borrowed on January 1, 2018 on a 9%, 3-year note payable. Other than the construction note, the only debt outstanding during 2018 was a $300,000, 12%, 6-year note payable dated January 1, 2016. Assume the weighted-average accumulated expenditures for the construction project are $870,000. The amount of interest cost to be capitalized during 2018 is:___________.
Answer:
$82,800
Explanation:
The computation of the amount of interest cost to be capitalized during 2018 is shown below:-
Amount of interest cost to be capitalized = (Borrowed amount × Rate of interest) + ($300,000 ÷ 2 × Rate of interest)
= ($720,000 × 9%) + ($150,000 × 12%)
= $82,800
Therefore for computing the amount of interest cost to be capitalized during 2018 we simply applied the above formula.
On December 31, 2018, Wintergreen, Inc., issued $150,000 of 7 percent, 10-year bonds at a price of 93.25. Wintergreen received $139,875 when it issued the bonds (or $150,000 × .9325). After recording the related entry, Bonds Payable had a balance of $150,000 and Discounts on Bonds Payable had a balance of $10,125. Wintergreen uses the straight-line bond amortization method. The first semiannual interest payment was made on June 30, 2019.Complete the necessary journal entry for June 30, 2019 by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns.
Answer: Please see explanation column
Explanation:
Journal entry for June 30
Date Amount Debit Credit
June 30 Bond Interest expense $5,756
Discount on Bonds Payable $506
Cash $5,250
Calculation:
Cash = 150,000 x 7%x 6/12 = $5,250
10-year bonds pay interest semiannually indicates 20 interest periods
Straight line Amortization of the discount =$10,125/20 = $506
Bond interest expense= Interest + amortization on discount
Interest = $150,000 x 7% x 6/12 = $5,250 + 506= $5,756.
"At Trent Company, there are 800 units of ending work in process that are 100% complete as to materials and 40% complete as to conversion costs. If the unit cost of materials is $3 and the total costs assigned to the 800 units is $6,000, what is the per unit conversion cost
Answer:
Conversion cost per unit =11.25
Explanation:
The cost per equivalent unit =
Total conversion cost / Total number of equivalent units
Total number of equivalent unit = Degree of completion × units
= 40%× 800= 320 units.
Total conversion cost = Total value of work in process - cost of materials
= 6,000 - (800× 3)
= 3,600
Conversion cost per unit = 3,600/320=11.25
Conversion cost per unit =11.25
A(n)__________innovation project includes rigorous risk analysis and contingency plans; planned evaluation and decision points where the project may be killed, redirected, or continued; and extra resources that can be quickly redeployed.
Answer:
flexible.
Explanation:
A flexible innovation project is an active management approach to the risks inherent in the project, but it has an execution methodology focused on making the processes involved more flexible, which ensures a redesign of the project scope in order to ensure that the project objectives are met. achieved through an improved strategy if significant innovations are taken to reduce time, costs and conduct aligned and proactive management.
When asset specificity is very high and there is market uncertainty, then it is best for a firm to:
a. Vertically integrate.
b. Ngage in a strategic alliance.
c. Use a short-term contract.
d. Buy in the open market.
Answer:
a. Vertically integrate.
Explanation:
a. Vertically integrate as this is the only way to reach the standards requirements of the product features at the reasonable amount.
Therefore according to the given situation, If the specificity of the assets is very high and there is market instability so it is appropriate for a company to vertical intergrate.
So, the correct answer is a.
Synovec Co. is growing quickly. Dividends are expected to grow at a rate of 25 percent for the next 3 years, with the growth rate falling off to a constant 6 percent thereafter. If the required return is 12 percent and the company just paid a $1.30 dividend. what is the current share price
Answer:
$36.81
Explanation:
Div₀ = $1.30
Div₁ = $1.625
Div₂ = $2.03125
Div₃ = $2.5390625
Div₄ = $2.6914 at a constant g of 6%
first we need to determine the terminal value in year 3:
P = $2.6914 / (12% - 6%) = $44.86
the current stock price, P₀ = $1.625/1.12 + $2.03125/1.12² + $2.5390625/1.12³ + $44.86/1.12³ = $1.45 + $1.62 + $1.81 + $31.93 = $36.81
The new union president has proposed a couple of ideas that are very unusual: 1. "We should make an effort to help solve problems in the business." 2. "We should encourage our members who have the right experience and training to apply for supervisor jobs." Are these ideas good or not?
Answer:
In simple words, supervisory jobs refers to those jobs in which an individual has to monitor the performance of other individuals working under his or her direction and guidance.
The opinion of the president, therefore, is not bad as an employee with relevant experience gets a certain respect and have adequate level of knowledge for teaching others.
The difference between actual hours times the actual pay rate and actual hours times the standard pay rate is the labor _________________ variance.
Answer:
"Labor price variance " is the correct choice.
Explanation:
The variation throughout the labor rate represents the distance between real as well as anticipated labor costs. These were measured by taking the difference, based upon the number of additional hourly wages, between some of the real labor amount charged as well as the minimum amount.Absolute variation in the labor rate is equivalent to absolute variation in the price of the commodity.Although GDP is a reasonably good measure of a nation's output, it does not necessarily include all transactions and production for that nation. Which of the following scenarios are either not accounted for or measured inaccurately by either the income or the expenditure methods of calculating GDP for the United States?
a) The leisure time enjoyed by households
b) The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government
c) Expenditures on federal highways
d) The loss of enjoyment people incur when scenic land is converted to commercial use
Answer:
a) The leisure time enjoyed by households
b) The value of babysitting services, when the babysitter is paid in cash and the transaction isn't reported to the government
d) The loss of enjoyment people incur when scenic land is converted to commercial use
Explanation:
Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year
GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export
Net export = exports – imports
When exports exceeds import there is a trade deficit and when import exceeds import, there is a trade surplus.
Items not included in the calculation off GDP includes:
1. services not rendered to oneself
2. Activities not reported to the government
3. illegal activities
4. sale or purchase of used products
5. sale or purchase of intermediate products
Expenditures on federal highways is accounted for in GDP as part of government expenditures
Orwell building supplies' last dividend was $1.75. Its dividend growth rate is expected to be constant at 34.00% for 2 years, after which dividends are expected to grow at a rate of 6% forever. Its required return (rs) is 12%. What is the best estimate of the current stock price? Select the correct answer. a. $49.93 b. $49.39 c. $48.85 d. $47.77 e. $48.31
Answer:
Price of the stock today = $48.85 and option c is the correct answer.
Explanation:
The current price of the stock can be computed using the two stage dividend growth model of the DDM approach. The DDM or dividend discount model values a stock based on the present value of the expected future dividends from the stock.
The formula for the price of the stock today using the two stage growth model is attached.
Price of the stock today = 1.75 * (1+0.34) / (1+0.12) + 1.75 * (1+0.34)^2 / (1+0.12)^2 + [ (1.75 * (1+0.34)^2 * (1+0.06)) / (0.12 - 0.06) ] / (1+0.12)^2
Price of the stock today = $48.85
Metaline Corp. uses the weighted average method for inventory costs and had the following information available for the year. The number of units transferred to finished goods during the year is:
Beginning Work in Process (30% complete, $1,600) 250 units
Ending inventory of Work in Process (70% complete) 450 units
Total units started during the year 3,700 units
a. 3,900 units.
b. 4,190 units.
c. 3,710 units.
d. 3,700 units.
e. 3,500 units.
Answer:
Total equivalent units= 4,190
Explanation:
Giving the following information:
Beginning Work in Process (30% complete, $1,600) 250 units
Ending inventory of Work in Process (70% complete) 450 units
Total units started during the year 3,700 units
We need to calculate the number of units completed and transferred out.
Beginning work in process= 250*0.7= 175
Units started and completed= 3,700
Ending work in process equivalent units= 450*0.7= 315
Total equivalent units= 4,190
Which of the following is a disadvantage of mass production particularly in regard to automation
A an enormous increase in productivity
B a decrease in the number of availabile jobs
C lower cost of materials services and capital
D equipment can often be repaired by individual parts
The disadvantage of mass production particularly in regard to automation is a decrease in the number of available jobs. The correct option is (B).
What do you mean by the mass production?Mass production is the process of producing standardized goods in huge quantities, frequently with the aid of automation or assembly lines.
The efficient creation of several identical products is made possible by mass production.
The goal of mass production is to maintain the lowest cost possible throughout the whole manufacturing process while producing the biggest volume achievable.
When goods are produced in large quantities, their individual costs are reduced. Production in large quantities takes the forms of flow production, job production, and batch production.
Therefore, the disadvantage of mass production particularly in regard to automation is a decrease in the number of available jobs.
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