Answer:
Onslow Co.
Journal Entries;
Jan. 2:
Debit Equipment $192,000
Credit Cash Account $192,000
To record the purchase of used machine by cash.
Jan. 3:
Debit Equipment $9,600
Credit Cash Account $9,600
To record the repair and installation costs.
December 31:
Debit Depreciation Expense $29,760
Credit Accumulated Depreciation $29,760
To record depreciation expense for the period.
Debit Sale of Equipment $201,600
Credit Equipment $201,600
To transfer the sale of equipment to Equipment.
On Disposal:
Debit Accumulated Depreciation $148,800
Credit Sale of Equipment $148,800
To record the disposal
Explanation:
Jan. 2 purchase of a used machine $192,000
Jan. 3 repair expenses 8,000
Jan. 3 installation 1,600
Total cost of acquisition $201,600
Salvage value 23,040
Depreciable amount 178,560
Depreciation per year $29,760 ($178,560 / 6)
Accumulated Depreciation for 5 years = $148,800 ($29,760 x 5)
A 5-year corporate bond yields 7.0%. A 5-year municipal bond (tax exempt bond) of equal risk yields 5.0%. Assume that the state tax rate is zero. At what federal tax rate are you indifferent between the two bonds?
Answer:
The tax rate is approximately(rounded to a whole) 29%
Explanation:
The federal tax that would make an investor indifferent between the 5-year corporate bond and the 5-year municipal bond can be derived by equating the return on the former to the taxable return of the latter as below:
5%=7%*(1-t)
where the t is the unknown tax rate
Note that the return on 5-year corporate bond is taxable while the return on the municipal bond is tax-free
5%=7%*(1-t)
5%/7%=1-t
0.7143 =1-t
t=1-0.7143
t=29%
Villalpando Winery wants to raise $20 million from the sale of preferred stock. If the winery wants to sell one million shares of preferred stock, what annual dividend will it have to promise if investors demand a return of a. 12%? b. 15%? c. 8%? d. 7%? e. 6%? f. 3%? a. What annual dividend will it have to promise if investors demand a return of 12%?
Answer:
$2.4/share
Explanation:
In order to calculate annual dividend we have to find the price per share first
Price per share = Total Capital raised/Number of shares
Price per share = $20,000,000/1,000,000
Price per share = $20
The annual dividend can be calculated by the following formula
Formula: Expected Return = Annual dividend/ price per share
NOTE: To find Annual dividend we need to adjust the formula accordingly
Annual dividend = Expected Return x Price per share
If Expected return is 12%
Annual dividend = 12% x $20 = $2.4/share
If Expected return is 15%
Annual dividend = 15% x $20 = $3/share
If Expected return is 8%
Annual dividend = 8% x $20 = 1.6/share
If Expected return is 7%
Annual dividend = 7% x $20 = $1.4/share
If Expected return is 6%
Annual dividend = 6% x $20 = $1.2/share
If Expected return is 3%
Annual dividend = 3% x $20 = $0.6/share
On January 1, 2020, Piper Corp. purchased 40% of the voting common stock for of Betz, Inc. for $2,000,000 and appropriately accounts for its investment by the equity method. During 2020, Betz reported earnings of $720,000 and paid dividends of $240,000. Ignore the dividend-received deduction. Piper's current enacted income tax rate is 21%. The increase in Piper's deferred income tax liability for this temporary difference is
Answer:
$57,600
Explanation:
The computation of the increase in Piper's deferred income tax liability for this temporary difference is shown below:-
Purchase of voting Common stock of Betz inc. by Piper Corp.= ( Betz's reported earnings - Betz Paid Dividends ) × (Percentage of the voting Common stock of Betz inc.)
= ($720,000 - $240,000) × 40%
= $480,000 × 40%
= $192,000
Now, the rise in Piper's deferred income tax liability for this temporary difference is
Purchase of voting Common stock of Betz inc. by Piper Corp. × enacted tax rate
= $192,000 × 30%
= $57,600
On July 23 of the current year, Dakota Mining Co. pays $6,110,400 for land estimated to contain 8,040,000 tons of recoverable ore. It installs machinery costing $723,600 that has a 10-year life and no salvage value and is capable of mining the ore deposit in eight years. The machinery is paid for on July 25, seven days before mining operations begin. The company removes and sells 414,250 tons of ore during its first five months of operations ending on December 31. Depreciation of the machinery is in proportion to the mine's depletion as the machinery will be abandoned after the ore is mined.
Required:
Prepare entries to record:
a. the purchase of the land
b. the cost and installation of machinery
c. the first five months' depletion assuming the land has a net salvage value of zero after the ore is mined.
d. the first five months' depreciation on the machinery.
Answer:
a.Purchase of Land
Land $6,110,400 (debit)
Cash $6,110,400 (credit)
b.Machinery Costs
Land $723,600 (debit)
Accounts Payable $723,600 (credit)
c. $314,830
d. $37,282.50
Explanation:
Purchase of Land
Land $6,110,400 (debit)
Cash $6,110,400 (credit)
Machinery Costs
Land $723,600 (debit)
Accounts Payable $723,600 (credit)
Depletion Expense = Cost of Asset / Expected Total Contents in Units × Number of Units taken in the Period.
= $6,110,400 / 8,040,000 tons × 414,250 tons
= $314,830
Depreciation Expense = Cost of Asset / Expected Total Contents in Units × Number of Units taken in the Period.
= $723,600 / 8,040,000 tons × 414,250 tons
= $37,282.50
Brodrick Company expects to produce 20,000 units for the year ending December 31. A flexible budget for 20,000 units of production reflects sales of $400,000; variable costs of $80,000; and fixed costs of $150,000. The company instead produces and sells 26,000 units for the year. Assume that actual sales are $480,000, actual variable costs for the year are $112,000, and actual fixed costs for the year are $145,000.
Prepare a flexible budget performance report for the year.
Answer:
Flexible budget performance report for the year
Sales ($400,000 / 20,000 × 26,000) $520,000
Less Variable Costs ($80,000 / 20,000 × 26,000) ($104,000)
Less Fixed costs ($150,000)
Budgeted Income / (Loss) $266,000
Explanation:
A flexed Budget is a Master Budget that has been adjusted to the Actual number of units produced and sold instead of Budgeted Units.
Note : Fixed Costs will the the same under the Master Budget and the Flexed Budget.
For several years Fister Links Products has held Microsoft bonds, considered by the company to be securities available-for-sale. The bonds were acquired at a cost of $530,000. At the end of 2021, their fair value was $646,000 and their amortized cost was $540,000. At the end of 2022, their fair value was $637,500 and their amortized cost was $550,000. At what amount will the investment be reported in the December 31, 2022, balance sheet
Answer:
Investment would be shown at the Fair Value of $637,500
Explanation:
The bonds are held for sale thus the Company measures the Bonds at Fair Value through Profit and Loss.
When it comes to Financial Assets, it is important to understand the model that is followed on the asset so as to measure the asset correctly.
Financial Assets held solely to collect Interest and Principle Amount are Subsequently measured at amortized cost whist Financial Assets held for trading or sale purposes are subsequently ,measured at Amortized cost.
The Investment would be shown at the Fair Value of $637,500 on December 31, 2022.
Suppose the 2017 financial statements of 3M Company report net sales of $21.7 billion. Accounts receivable (net) are $3.40 billion at the beginning of the year and $3.42 billion at the end of the year.
1. Compute 3M’s receivable turnover.
2. Compute 3M’s average collection period for accounts receivable in days.
Answer:
A.Receivable turnover 6.36
B. Average collection period 57.38
Explanation:
A. Computation of 3M Company’s receivable turnover
Using this formula
Receivable turnover= Net annual credit sale / (beginning accounts receivable+ending accounts receivable)/2
Let plug in the formula
Receivable turnover=21.7/ ((3.40 +3.42)/2)
Receivable turnover= 21.7/(6.82/2)
Receivable turnover=21.7/3.41
Receivable turnover=6.36
B. Computation of 3M Company’s average collection period for accounts receivable in days
Using this formula
Average collection period = Number of days in a year/Receivable Turnover
Let plug in the formula
Average collection period=365 /6.36
Average collection period= 57.38
Therefore Receivable turnover will be 6.36 and the Average collection period will be 57.38.
On the first day of the fiscal year, a company issues a $2,600,000, 7%, 6-year bond that pays semiannual interest of $91,000 ($2,600,000 × 7% × ½), receiving cash of $2,477,994. Journalize the first interest payment and the amortization of the related bond discount. Round to the nearest dollar. If an amount box does not require an entry, leave it blank.
Answer:
Dr interest expense( 10,167.17+91,000) $ 101,167.17
Cr cash $91,000.00
Cr discount on bonds payable $ 10,167.17
Explanation:
The discount on bond issuance is the difference between the cash proceeds received and the face value of the bonds.
discount on bonds payable=$2,600,000-$2,477,994=$122,006.00
amortization of discount=discount/number of semiannual interest payable
in 6 years,12 semiannual coupons are payable
amortization of discount=$122,006.00 /12=$10,167.17
Consider a mutual fund with $200 million in assets at the start of the year and 10 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $2 million. The stocks included in the fund's portfolio increase in price by 8%, but no securities are sold and there are no capital gains distributions. The fund charges 12b-1 fees of 1%, which are deducted from portfolio assets at year-end. a. What is the fund's net asset value at the start and end of the year?
Answer:
At start = $20/share
At end = $21.384
Explanation:
DATA
ASSets at the start = $200m
Outstanding shares = 10m
Dividend income at the end = $2m
Gain in price = 8%
12b-1 fees = 1%
A.
Net assets at the start can be calculated by dividing assets at the start by outstanding shares
Net Assets value at start = Assets at start/Outstanding shares
Net Assets value at start = $200m/10m
Net Assets value at start = $20/share
Net Assets value at the end can be calculated by multiplying gain price with 12b-1 fees
Net assets value at the end = Gain Price x (1-12b-1 fees)
Net Assets value at the end = ($20x$1.08) x (1 - 0.01)
Net Assets value at the end = $21.6 x 0.99
Net Assets value at the end = $21.384
Schrank Company is trying to decide how many units of merchandise to order each month. Company policy is to have 30% of the next month's sales in inventory at the end of each month. Projected sales for August, September, and October are 35,000 units, 25,000 units, and 45,000 units, respectively. How many units must be purchased in September?
Answer:
31,000 units
Explanation:
Calculation for how many units must be purchased in September
Using this formula
Purchase = (Percentage of the month's sales in inventory × Projected sales for October + Projected sales for September - (Percentage of the month's sales in inventory ×Projected sales for September)
Let plug in the formula
Purchase =(30%× 45,000) + 25,000 - (30% × 25,000)
Purchase =13,500+25,000 -(7,500)
Purchase =38,500-7,500
Purchase =31,000 Units
Therefore 31,000 units must be purchased in September
With adaptive expectations, what is the inevitable consequence of an unexpected, active, expansionary monetary policy in the short and long run
Answer:
D. lower unemployment in the short run, higher inflation in the long run
Explanation:
Remember, like it's name, monetary policy affects the money supply of a country, which in turn influences the Interest rate and inflation rate.
By means of expansionary monetary policy, an economy may experience reduced interests rates, which leads to lower unemployment in the short run. However, in the long run the high inflation rate may begin to occur leading to adaptive expectations.
Summary: With 250,000 employees in 19 countries, Aramark wanted to motivate its employees who clean airplanes for Delta and Southwest Airlines. Turnover of the low-paid, largely immigrant staff was high while morale was low. Wallets and other valuables left on planes disappeared. After 5 years of efforts to increase motivation, revenue rose from $5 million to $14 million. 1. What motivation theories apply to the workers at Aramark? 2. If you were the manager of these employees, what would you do to motivate them? Be honest regarding your personal management style and beliefs rather than trying to be like Roy Pelaez. 3. What are some possible barriers to the effectiveness of your motivation ideas? What could you do to overcome them?
Answer:
Explanation:
(A)
What motivation theory applies to the workers at Aramark?
The workers should be motivated with payments for the return of valuables forgotten in the aircraft.
(B)
To motivate them, offer them a salary increase
(C)
Some possible barriers to the effectiveness of these motivation ideas are gluttony (depending on individual worker), a period of stiff or falling profit (which will hinder the smooth running of the new benefit policies), change of management.
(D)
What could you do, to overcome them?
To ensure that workers do not still steal forgotten valuables, place a check or supervision on them.
To ensure the profit level is maintained or increased, make sure the workers do not relent in their duties. Sometimes, more benefits make workers relax more.
Variable Overhead Spending and Efficiency Variances, Columnar and Formula Approaches Aretha Company provided the following information: Standard variable overhead rate (SVOR) per direct labor hour $4.70 Actual variable overhead costs $335,750 Actual direct labor hours worked (AH) 69,200 Actual production in units 14,000 Standard hours (SH) allowed for actual units produced 70,000 Required: 1. Using the columnar approach, calculate the variable overhead spending and efficiency variances. Enter amounts as positive numbers and select Favorable (F) or Unfavorable (U).
Answer:
Variable overhead spending variance $10,380 U
Variable efficiency variances $ 3,760.00 F
Total variable overhead variance $ 6,620.00 U
Explanation:
1. Calculation for the variable overhead spending and efficiency variances
AH * AH
69,200*4.85=335,620.00
AH* SR
69,200 * 4.7=325,240.00
SH * SR
70,000*4.7= 329,000.00
Hence, the variable overhead spending will be:
AH * AH- AH* SR
=335,620.00-325,240.00= $10,380 U
The efficiency variances will be:
AH* SR- SH * SR =325,240.00- $329,000.00 =$ 3,760.00 F
2.Calculation for the variable overhead spending variance.
Using this formula
Variable overhead efficiency variance = SR × (AH – SH)
Let plug in the formula
SR = Standard variable manufacturing overhead rate = $4.70
AH = Actual hours worked during the period = 69,200
SH = Standard hours allowed for actual output or production = 70,000
Variable overhead efficiency variance = SR × (AH – SH) = 4.70 (69,200 -70000)
= 4.70* 800 =3,760.00 F
3.
Using this formula
Variable Overhead Spending variance = (Actual Rate * Actual Hour - Standard Rate * Actual Hour )
= AH (AR - SR)
Let plug in the formula
AR = 33,5750/69200
= $ 4.8
AH = Actual hours worked during the period = 69,200
SR = Standard variable manufacturing overhead rate = $4.70
Variable overhead spending variance = 69200 ( 4.85 - 4.70)
$ 10,380.00 U
4. Calculation for total variable overhead variance
Using this formula
Total Variable Overhead variance = (Actual Hour * Actual Rate - Standard Hour * Standard Rate)
Let plug in the formula
AH = Actual hours worked during the period = 69,200
SH = Standard hours allowed for actual output or production = 70,000
AR = 335750/69200 = $ 4.85
SR = Standard variable manufacturing overhead rate = $4.70
Total Variable Overhead variance = (69200*4.85) - (70000*4.7)
=$ 6,620.00 U
Stocks are shares of ownership in a company. A stock certificate represents stock ownership. It specifies the name of the company, the number of shares owned, and the type of stock it represents. Today, stock is generally held electronically; that is, the owners don't get a paper certificate unless they specifically want to hold the certificates themselves.
Please evaluate the following statements from the standpoint of the issuing company and the place each statement in the category of Advantages or Disadvantages Disadvantage
Advantages Dividends
1. Repaid
2. Shareholders
3. Future Buy Back
4. Net Profit After Taxes
5. One Vote Per Share
Answer:
Advantages
Dividends
These are payments to shareholders as a way to share the profits the company has accumulated.
This is an advantage to the issuing company because they are usually not under any obligation to pay Dividends with respect to common Equity. As a result profits can be plowed back into the company to increase profitability.
Repaid
This refers to the fact that shareholders do not have to be repaid for their investment like debt holders are. Stock Holders bought a piece of the company instead of loaning money to the company so they do not have to be paid back. This is an advantage because it frees up Cashflow for the company as well as allowing it to maintain a better credit rating due to lower debts.
Future Buy-Back
This is a clause inherent in most shares. It means that the Issuing company can choose to buy back the stock at a given time in future.
This is an Advantage because it allows the Issuing company to regain control of the company at a future date.
Disadvantages.
Shareholders
Shareholders are people or entities who buy shares in the Issuing company. As such, they are owners in the company and have voting rights on decisions that the company makes. This is a disadvantage because it means loss of Independence for the company who now legally have to take the opinions of shareholders into account.
Net Profit After Tax
This is money that the company has after paying off interests and then taxes. This is the money that the company retains. Having shareholders means that a company may have to pay shareholders from this amount instead of retaining all of it thereby making it at a disadvantage to the Issuing company.
One Vote per Share
This means that every shareholder has a vote for every share they hold in the company. This means that Shareholders therefore have a say in the affairs of the company. This is a disadvantage to the Issuing company because it means a loss of Independence for them when decisions need to be made.
Coolibah Holdings is expected to pay dividends of $ 1.00 every six months for the next three years. If the current price of Coolibah stock is $ 21.90, and Coolibah's equity cost of capital is 14%, what price would you expect Coolibah's stock to sell for at the end of three years?
Answer: The price that would be expected for Coolibah's stock to sell for at the end of three years is $28.87
Explanation: It should be noted that to calculate a price that would be expected in Coolibah's stock to sell for at the end of three years can be calculated using financial calculator:
A) Using a financial calculator, PV = -$22.60 , PMT = $1.20, n = 6, I = 18% / 2;
calculate FV = $28.87 .
The beta of an all equity firm is 2.3. If the firm changes its capital structure to 50% debt and 50% equity using 8% debt financing, what will be the equity beta of the levered firm
The beta of an all equity firm is 2.3. If the firm changes its capital structure to 50% debt and 50% equity using 8% debt financing, what will be the equity beta of the levered firm? The beta of debt is 0.2. (Assume no taxes.) Provide your answer with 2 digits after the comma.
Answer:
4.40
Explanation:
Equity beta, is a term in business or economics, which is.oftemr referred to as Levered beta, which measures the risk of a firm in respect to debt and equity in its capital structure to the volatility of the stock market.
Therefore, Formula for equity beta is giving as = βE = equity firm + (debt/equity)(equity firm - beta of debt)
Given that, equity firm = 2.3
Capital structure to debt = 50% = 0.5
Capital structure to equity = 50% = 0.5
Beta of debt = 0.2
βE = 2.3 + (0.5/0.5)(2.3 - 0.2) =
2.3 + (0.5/0.5)(2.3 - 02) =
= 2.3 + (1)(2.1)=
2.3 + 2.1= 4.40
Hence, the final is 4.40
The following information pertains to Carla Vista Company.
1. Cash balance per bank, July 31, $7,738.
2. July bank service charge not recorded by the depositor $48.
3. Cash balance per books, July 31, $7,774.
4. Deposits in transit, July 31, $3,110.
5. $2,426 collected for Carla Vista Company in July by the bank through electronic funds transfer. The collection has not been recorded by Carla Vista Company.
6. Outstanding checks, July 31, $696.
Prepare a bank reconcilliation at July 31 2017.
Journalize the adusting entries at July 31 on the books of Carla Vista company.
Answer:
Bank account reconciliation:
Bank account balance $7,738
+ Deposits in transit $3,110
- Outstanding checks $696
Reconciled bank account $10,152
Cash account reconciliation:
Cash account balance $7,774
+ Note (or account) collected $2,426
- Bank fees $48
Reconciled cash account $10,152
Adjusting journal entries:
July 31, 202x, bank fees expense
Dr Bank fees expense 48
Cr Cash 48
July 31, 202x, bank fees expense
Dr Cash 2,426
Cr Notes (or accounts) receivable 2,426
How can you filter the for review tab to see all the transactions quickbooks online thinks it has found a good match for?
Answer:
Click on the Recognized tab
Explanation:
If you want to filter the for review tab to find the good match all you have to do is:
Step 1: Go at "For Review" Tab
Step 2: Above the transactions their will be Recognized Tab. Click on it which would filter all the transactions that provides a good match.
Twelve months ago, you purchased 10-year Treasury notes with a face value of $1,000. The interest rate is 2.45 percent. What is the dollar amount of interest you will receive each year for each note? (Round your answer to 2 decimal places.)
Answer:
$24.50
Explanation:
Relevant data provided
Face value = $1,000
Interest rate = 3.45%
Based on the above information
The computation of the dollar amount of interest is shown below:-
Interest per year = Face value × Interest rate
= $1,000 × 2.45%
= $24.50
Therefore for computing the interest per year we simply applied the above formula.
The Closed Fund is a closed-end investment company with a portfolio currently worth $200 million. It has liabilities of $3 million and 5 million shares outstanding. a. What is the NAV of the fund?
Answer:
$39.40
Explanation:
According to the situation, the solution is as follows
The Net asset value of the fund is
= (Current worth of portfolio - liabilities) ÷ (outstanding shares)
= ($200 million - $3 million) ÷ (5 million shares)
= $39.40
Basically we applied the above formula in order to determine the net asset value of the fund.
dentify what concept each of the following circumstances is an example of: a. Students end up doing "all-nighters" just to finish a term paper. (Click to select) b. The so-called "Lake Wobegon effect" where everyone in a group claims to be above average. (Click to select) c. People who are usually very neat tend to litter in areas that are covered with graffiti. (Click to select) d. Behavioral economists suggest that brand loyalty can be a source of monopoly power for producers. (Click to select)
Answer:
a. Students end up doing "all-nighters" just to finish a term paper.- Planning Fallacy
The Planning fallacy is a tendency by humans to overestimate how much time they have to complete a project due to them having an optimism bias when projecting how much time will be needed. The students thought they had time to study up until they didn't.
b. The so-called "Lake Wobegon effect" where everyone in a group claims to be above average. - The Overconfidence Effect
The overconfidence effect leads people to believe that their abilities exceed what they actually are and can be called the Lake Wobegon effect which was derived from the name of a fictional town where every child was supposedly above average.
c. People who are usually very neat tend to litter in areas that are covered with graffiti.- Framing effect
The Framing effect refers to a cognitive tendency by people to make decisions based on the how it is presented to them. The places covered with graffiti appeared dirty to them so them chose to litter there.
d. Behavioral economists suggest that brand loyalty can be a source of monopoly power for producers. - Status quo bias
This supports the old saying, "if it isn't broke, don't fix it". This bias is an emotional one that leads people to stay in a condition that they are used to because it is what they know and anything else might be considered a loss to them. Therefore companies can use these to always sell to a group of people if those people have brand loyalty.
A jewelry firm buys semiprecious stones to make bracelets and rings. The supplier quotes a price of $8.90 per stone for quantities of 600 stones or more, $9.30 per stone for orders of 400 to 599 stones, and $9.80 per stone for lesser quantities. The jewelry firm operates 108 days per year. Usage rate is 26 stones per day, and ordering costs are $46.
a. If carrying costs are $2 per year for each stone, find the order quantity that will minimize total annual cost.
b. If annual carrying costs are 20 percent of unit cost, what is the optimal order size?
c. If lead time is 5 working days, at what point should the company reorder?
Answer:
MOST LIKELY it's B
Explanation:
if not I'm really sorry I tried
. Find the accumulated present value of a continuous income stream that earns 4.2% interest annually, when $4000 is deposited per year for 30 years in the account.
Answer:
The accumulated present value is $67,518.99.
Explanation:
Investment opportunities that require a series of payments of a fixed amount for a specific number of periods are known as annuities.
The Present Value of this annuity can be calculated as :
Fv = $0
n = 30
r = 4.2 %
Pmt = - $4,000
P/ yr = 1
Pv = ?
Using a financial calculator, the Present Value (PV) of the annuity is $67,518.9948 or $67,518.99.
Flip's Pizzeria Inc. has the following financial items for the current year: Advertising Expenses $35,000 Cost of Goods Sold $400,000 Other Operating Expenses $300,000 Sales $2,735,000 Cost of Equipment purchased during the year (10 year estimate useful life, 0 salvage value) $325,000 Calculate Flip's taxable liability for the current year.
Answer:
we must determine the taxable income:
Sales $2,735,000
Cost of Goods Sold $400,000
Advertising Expenses $35,000
Other Operating Expenses $300,000
taxable income = $2,000,000
assuming the current corporate income tax rate (21%), current tax liability = $2,000,000 x 21% = $420,000
Since the question did not include any specific tax rate, I used the current one. But if the complete question includes some other tax rate, just multiply the taxable income by it.
An institution is a significant practice, relationship, or organization in a society. Institutions shape the environment in which decisions are made, and they affect production and income in a nation. The most significant institutions are private property rights, political stability and the rule of law, open and competitive markets, efficient taxes, and stable money and stable prices. Complete each of the following sentences with the correct institution. a. The single greatest incentive for voluntary production is the existence of . b. increase investment in physical and human capital because they increase the predictability of future payoffs. c. Specialization is more likely to occur in nations with and result in more efficient production because of economies of scale. d. The Xiaogang agreement that led to an agricultural boom in China is an example of the power of
Answer:
a. Private Property Rights
b. Political Stability and Rule of Law
c. Open and Competitive Market
d. Private Property Rights
Explanation:
a. By defining private property Rights and giving people a chance to own resources, Individuals will strive to own more and more of such rights and so will produce as much as they can so as to afford such rights.
b. When a nation is Politically stable and respects the Rule of Law, investment payoffs are easier to predict than in a country where instability can threaten to degrade investments such that the payoffs will be lost. For example, think of all the Western firms that lost money when the Shah of Iran was overthrown by the Ayatollah.
c. Specialization is more likely to occur in nations with Open and Competitive Market. An Open Market means that goods can come in from the outside easily. This will have the effect of the country being able to import goods that cost a lot to produce locally and instead focus on producing those goods that they are well adept at producing. This is Specialization. Also as a result of competition, companies will strive to find better ways to make profit above competitors and come up with more efficient ways of Production as a result.
d. The Xiaogang Agreement refers to an agreement by farmers in Xiaogang to subdivide their lands in secret so that they would each own a small part of it. As a result, the farmers had an incentive to produce for themselves as they now owned resources that they could benefit from. This right to Private Property led to a huge boom in Agriculture.
A company needs to locate three departments X, Y, and Z in the three areas I, II, and III of a new facility. They want to minimize interdepartmental transportation costs, which are expected to be $.50 per load meter moved. An analyst has prepared the following flow and distance matrices:
Distances meters Flows Loads per week
From / To I II III From / To X Y Z
I - 10 20 X - 0 80
II - - 10 Y 30 - 150
III - Z 100 130 -
If the company were to locate departments X, Y, and Z in areas 1, 2, and 3, respectively, what would be the total distance (in meters) loads would be moved each week?
A. 3,100
B. 3,600
C. 6,200
D. 7,200
E. 8,200
Answer: A. 3,100
the total distance (in meters) loads that would be moved each week is 3,100
Explanation:
First we arrange the workflow of the departments in descending order while the distance will be in ascending order.
TRIPS DISTANCE(metres)
1 -11 10
11 - 111 10
1 - 111 20
DEPARTMENTAL PAIR WORKFLOW
Y-Z 150
Z-Y 130
Z-X 100
X-Z 80
Y-X 30
Given that question provided to allocate departments X, Y, and Z in areas 1, 2, and 3 respectively.
So, having that in mind, allocate the distance for each suitable departmental pair;
DEPARTMENTAL PAIR WORKFLOW DISTANCE TOTAL DISTANCE
(meter loads)
Y-Z 150 10 1500
Z-Y 130 -
Z-X 100 10 1000
X-Z 80 -
Y-X 30 20 600
3100
Therefore the total distance (in meters) loads that would be moved each week is 3,100
ABC Company sells three products, X, Y and Z. The weighted average contribution margin for all three products is $3.05 per unit. ABC's total fixed costs are $35,000. Sales mix percentages are :
Answer:
Break-even point (units)= Total fixed costs / Weighted average contribution margin
Explanation:
Giving the following information:
The weighted average contribution margin for all three products is $3.05 per unit. ABC's total fixed costs are $35,000
With the information provided, we can only calculate the break-even point in units for the whole company using the following formula:
Break-even point (units)= Total fixed costs / Weighted average contribution margin
Break-even point (units)= 35,000/3.05
Break-even point (units)= 11,475
Now, imagine the following sales mix:
X= 0.25
Y=0.40
Z=0.35
We can determine the number of units for each product:
X= 11,475*0.25= 2,869
Y= 11,475*0.4= 4,590
Z= 11,475*0.35= 4,016
If investors receive a 6% interest rate on their bank deposits, what real interest rate will they earn if the inflation rate over the year is:
Question
The complete question is given as follows:
if investors receive a 6% interest rate on their bank deposits, what real interest rate will they earn if the inflation rate over the year is:
a) 3%
b) 6%
Answer:
a) Real rate = 2.91%
b) Real rate = 0%
Explanation:
Inflation is the increase in the price level.It erodes the value of money.
Nominal interest is that quoted for investment or loan transactions. It has not been been adjusted for inflation.
Real interest rate is the amount of interest in terms of the the quantity of good and services that can be purchased. It is the nominal interest rate adjusted for inflation.
The relationship between inflation, real interest and nominal interest rate is given using the Fishers Effect;
R = (1+N)/(1+F) - 1=
N- Nominal interest rate
R- Real interest rate
F- Inflation rate
a) Where inflation rate is 3%
Real rate = (1.06/1.03 - 1)× 100 = 2.91%
b) Where inflation rate is 6%
Real rate = (1.06/1.06 - 1)× 100 = 0%
a) Real rate = 2.91%
b) Real rate = 0%
Paulson Company issues 6%, four-year bonds, on January 1 of this year, with a par value of $200,000 and semiannual interest payments.
Semiannual Period-End Unamortized Discount Carrying Value
(0) January 1, issuance $13,466 $ 186,534
(1) June 30, first payment 11,782 188,218
(2) December 31, second payment 10,098 189,902
Answer: Incomplete question.
the complete queston is
Use the above straight-line bond amortization table and prepare journal entries for the following.
(a) The issuance of bonds on December 31, 2020.
b) The first interest payment on June 30, 2021.
(c) The second interest payment on December 31, 2021.
find answer in explanation column.
Explanation:
Semiannual Period-End Unamortized Discount Carrying Value
(0) January 1, issuance $13,466 $ 186,534
(1) June 30, first payment 11,782 188,218
(2) December 31, second payment 10,098 189,902
1. to record issue of bonds payable
Date Account Debit Credit
Dec 31,2020 Cash(carrying value) $ 186,534
Discount on bonds payable $13,466
Bonds payable $200,000
2. To record first interest payment
Date Account Debit Credit
june 30, 2021 Interest expense $7,684
discount on bonds payable $1, 684
Cash $6,000
Calculation =
Cash paid towards interest every semi annual period = $200,000 X 6% X1/2 =$6,000.
interest expense = cash paid + discount on bonds payable written off.
= $6000 + $1, 684 = $7,684
discount on bonds payable = unamortised discount on 31 dec - unamortised discount on 30th june) ($13,466 -11,782 ==$1,684)
3.To record second interest payment on december 31,2021.
Date Account Debit Credit
Dec. 31 ,2021 Interest expense $7,684
discount on bonds payable $1.684
Cash $6,000
Calculation
discount on bonds payable = unamortised discount on 30th june - unamortised discount on 31st december 2021 =11,782-10,098 = $1.684
A company's product sells at $12 per unit and has a $5 per unit variable cost. The company's total fixed costs are $98,000. The contribution margin per unit is:
Answer:
The contribution margin per unit is $7
Explanation:
The contribution margin per unit can be defined as the difference between the selling price per unit and the variable cost per unit.
Contribution margin per unit = Selling price - Variable cost
Contribution margin per unit = $12 - $5
Contribution margin per unit = $7
The contribution margin per unit is $7