Answer:
56.2
Explanation:
Inventory turnover = Cost of goods sold / Average inventory
= $9,333,000 / $1,442,000
= 6.5 times
Average days in inventory during the year = 365 / 6.5
= 56.2 days
Sampson Co. sold merchandise to Batson Co. on account, $46,000, terms 2/15, net 45. The cost of the merchandise sold is $38,500. Batson Co. paid the invoice within the discount period. Assume both Sampson and Batson use a perpetual inventory system.
Required:
Prepare the entries that both Sampson and Batson Companies would record.
Answer:
Sampson Company
Dr Accounts Receivable -Batson Co.45,080
Cr Sales 45,080
Dr Cost of Merchandise Sold38,500
Cr Merchandise Inventory38,500
Dr Cash 45,080
Cr Accounts Receivable-Batson Co.45,080
Batson Company
Dr Merchandise Inventory45,080
Cr Accounts Payable - Sampson Co.45,080
Dr Accounts Payable -Sampson Co.45,080
Cr Cash45,080
Explanation:
Preparation of the Journal entries for both Sampson and Batson Companies would record
Based on the information given we were told that Sampson Company sold merchandise to Batson Company At the amount of $46,000 with 2/15 term while the merchandise was sold at the amount of $38,500 and since we are Assuming that both of them uses a perpetual inventory system this means the transaction will be recorded as:
Journal Entries for Sampson Company
Dr Accounts Receivable -Batson Co.45,080
Cr Sales 45,080
(2%*46,000=920)
(45,000-920=45,080)
Dr Cost of Merchandise Sold38,500
Cr Merchandise Inventory38,500
Dr Cash 45,080
Cr Accounts Receivable-Batson Co.45,080
Journal Entries for Batson Company
Dr Merchandise Inventory45,080
Cr Accounts Payable - Sampson Co.45,080
(2%*46,000=920)
(45,000-920=45,080)
Dr Accounts Payable -Sampson Co.45,080
Cr Cash45,080
(2%*46,000=920)
(45,000-920=45,080)
Chimney Sweeps provided chimney cleaning services to several clients during the month of February. Chimney's customers have not yet been billed. Chimney's customers owe $2,000 to Chimney. How will Chimney Sweeps record this transaction?
Answer:
The Answer is explained below
Explanation:
As chimney has provided clearing services to several clients and have not yet been billed Chimney will debit the accounts receivable with $2,000 and will credit the Services revenue by $2,000.
Entry DEBIT CREDIT
Account Receivable $2,000
Services Revenue $2,000
You make monthly payments on your car loan. It has a quoted APR of 6.7% (monthly compounding). What percentage of the outstanding principal do you pay in interest each month?
Answer:
Monthly percentage rate = 0.55%
Explanation:
DATA:
APR = 6.7%
Monthly interest percentage =?
Solution:
Basically APR means Annual percentage rate refers to annual rate of interest charged to borrowers and paid to investors.
Here we have asked to find the monthly interest percentage. In order to find that out, we need to divide APR by 12 months.
Monthly percentage rate = APR/12months
Monthly percentage rate = 6.7%/12months
Monthly percentage rate = 0.55%
The comparative cash flow statements from Sears and Wal-Mart are presented above. Amounts presented are in millions. Review both statements considering what you've learned in this chapter about the cash flow statement. Answer the following questions: When analyzing a company's cash flow statement, which section of the statement (operating, investing or financing) do you believe is the best predictor of a company's future profitability? Why? Which company do you believe is healthier based on the cash flow statements presented? Provide at least two specific examples from the statements. Your initial post is due four (4) days prior to the discussion due date or points will be deducted from your discussion score. Please review the discussion board requirements above.
The complete question is attached.
Answer:
Sears Holding Corporation and Wal-Mart Stores, Inc.
1. The section of the cash flow statement that is the best predictor of a company's future profitability is the Operating Activities Section. The reason is that the operating activities section shows the net cash from operating activities or the core business activities of the entity. A business entity's profitability is not determined by subsidiary activities like financing and investing activities. But it is ascertained by reviewing its operating activities which also define the mission of the business and show the strategies it can deploy to attain its goals.
2. Walmart Stores, Inc. is by far healthier than Sears Holdings Corporation, at least based on the January 30, 2016 statements of cash flows. For instance, Walmart Stores recorded a Net Cash Flow from operations in the sum of $27,389 million while Sears recorded a negative Net Cash Flow from operations in the sum of $2,167 million. Again, from the operating activities sections, one can see that Walmart Stores, Inc. was able to make a net income before adjustments of $15,080 million, whereas Sears Holding Corporation performed abysmally poor by incurring a net loss of $1,128 million.
Explanation:
The Sears and Walmart's statements of cash flows are one of the three main financial statements prepared and presented by Sears Holding Corporation or Walmart Stores, Inc. to its stockholders and the general public to show financial information about its activities. Specifically, the statements of cash flows for Sears and Walmart show the flow of cash under three main activity headings: operating, financing, and investing.
Two methods can be used by Sears and Walmart to prepare the statement. They include the indirect method, which starts from the net income, and the direct method, which shows the cash inflows and outflows for each cash flow item for Sears and Walmart.
A plant asset is acquired by a business on January 2, 20X6, for $10,000. The asset's estimated residual value is $2,000 and it's estimated useful life is 5 years. Management chooses to use straight-line depreciation. On January 2. 20X8. the asset is sold for $5,000. The entry to record the sale has what effect on the financial statements? a. Assets decrease, expenses increase, and net income and owners' equity decrease. b. Assets decrease and owners' equity and expenses both increase. c. Has no effect on the financial statements if the journal entry is in balance. d. Assets increase, expenses decrease, and net income and owners' equity increase.
Answer:
Option A
Explanation:
From the calculation below, it is clearly seen that Assets are being decreased and expenses are increased therefore Option A is correct.
Workings
Depreciation expense = (cost - residual value) / useful life
Depreciation expense = 10,000 - 2,000 / 5
Depreciation expense = $1600
Accumulated depreication = depreciation x 2 years -= $3,200
Carrying value = 10,000 - 3,200
Carrying value = $6,800
Disposal = $5,000
Loss on disposal = $1,800
Sinking fund bonds: A. Are bearer bonds. B. Are registered bonds. C. Require equal payments of both principal and interest over the life of the bond issue. D. Require the issuer to set aside assets at specified amounts to retire the bonds at maturity. E. Decline in value over time.
Answer:
The answer is D.
Explanation:
Sinking funds require the issuer(borrower) to set aside assets at specified amounts to retire the bonds at maturity. Sinking fund helps the issuer to secure a bond with lower yield.
An agreed amount is deposited at an agreed period (e.g yearly) so as to pay of the par value or principal value at maturity.
If Wiper's stock had a price/earnings ratio of 10 at the end of 2020, what was the market price of the stock?Calculate the cash dividend per share for 2020 and the dividend yield based on the market price calculated in part e.Calculate the dividend payout ratio for 2020.Assume that accounts receivable at December 31, 2020, totaled $322 million. Calculate the number of days' sales in receivables at that date.Calculate Wiper's debt ratio and debt/equity ratio at December 31, 2020 and 2019.Calculate the times interest earned ratio for 2020 and 2019.
Answer:
Stock Price is $54.50
Cash Dividend per share $1.50
Dividend Yield 2.75%
Dividend payout ratio 27.46%
Days Sales in Receivable 38 days
Debt Ratio 68.29%
Debt/equity ratio 1.57
Interest earned ratio 3.16 times
Explanation:
1. Market price = Price to earning ratio * Earning per share
Earnings per share = Net Income / Average number of shares outstanding
Earnings per share : 233 / 42.7 = 5.45
Market price per share : 10 * 5.45 = 54.50
2. Dividend per share : Dividend paid / number of shares outstanding
DPS : 64 / 42.7 = 1.50
3. Dividend Yield : Dividend per share / Stock Price share
Dividend Yield : 1.50 / 54.50
4. Dividend Payout ratio : Total Dividend paid / Net Income
Dividend Payout ratio : 64 / 233 = 27.46%
5. Day Receivale : (Average Receivable / Sales ) * 365
Days Receivables : 322/ 3064 * 365 = 38 days
6. Debt Ratio : Total Liabilities / Total Assets
Debt ratio : 2194 / 3215 = 68.29%
7. Debt/ equity ratio : Debt / Equity
Debt/Equity : 1603 / 1021 = 1.57
8. Interest Earned Ratio : Earning before Interest and Tax / Interest Expense
Interest Earned Ratio : 310 / 98 = 3.16 times
Which of the following statements regarding a partner's basis of inventory received in a liquidating distribution is True?
A) Partners may either increase or decrease the basis in inventory distributed in a liquidating distribution.
B) Partners may only increase the basis in inventory distributed in a liquidating distribution.
C) Partners may only decrease the basis in inventory distributed in a liquidating distribution.
D) None of these statements is True.
Answer:
C) Partners may only decrease the basis in inventory distributed in a liquidating distribution.
Explanation:
Liquidating distribution refers to the absence of dividend distribution that is to be allocated to the shareholders in case of the partial or complete liquidation. In this, the whole equity is allocated along with the profit-sharing
In case fo inventory received based on a partner basis, the partners are only eligible to decrease the inventory basis
hence, the option c is correct
Suppose a society begins by producing 3 units of X and 4 units of Y and then alters production to 4 units of X and 4 units of Y. If the quantity and quality of resources and the technology being used remain unchanged, then: Group of answer choices
Answer:
This situation means that resources were not being efficiently used.
If society managed to produce 1 more unit of X with the same resources and technology, this means that some resources were idle in the past, which causes inefficiency.
This also means that the combination 3 units of X and 4 units of Y is a point inside the PPF. However, we do not know if the combination 4 units of X and 4 units of Y is a point inside the PPF, or on the PPF, because there could be some other combination that could be even more efficient (for example 5 units of both X and Y with the same resources and technology).
Golden Corp.'s current year income statement, comparative balance sheets, and additional information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes.
GOLDEN CORPORATION Comparative Balance Sheets December 31
Current Year Prior Year
Assets
Cash $167,000 $110,300
Accounts receivable 87,500 74,000
Inventory 605,500 529,000
Total current assets 860,000 713,300
Equipment 343,000 302,000
Accum. depreciation—Equipment (159,500) (105,500)
Total assets $1,043,500 $909,800
Liabilities and Equity:
Accounts payable $93,000 $74,000
Income taxes payable 31,000 26,600
Total current liabilities 124,000 100,600
Equity:
Common stock, $2 par value 595,600 571,000
Paid-in capital in excess of par value, common stock 201,400 164,500
Retained earnings 122,500 73,700
Total liabilities and equity $1,043,500 $909,800
GOLDEN CORPORATION Income Statement For Current Year Ended December 31
Sales $1,807,000
Cost of goods sold 1,089,000
Gross profit 718,000
Operating expenses
Depreciation expense $54,000
Other expenses 497,000 551,000
Income before taxes 167,000
Income taxes expense 26,200
Net income $140,800
Additional Information on Current Year Transactions:
Purchased equipment for $41,000 cash.
Issued 12,300 shares of common stock for $5 cash per share.
Declared and paid $92,000 in cash dividends.
Required:
Prepare a complete statement of cash flows: report its cash inflows and cash outflows from operating activities according to the indirect method.
Answer:
Golden Corp.
Statement of Cash Flows for the year ended December 31, using the indirect method:
Net Income before taxes $167,000
Add non-cash expenses:
Depreciation 54,000
Adjustment of current assets:
Accounts receivable (13,500)
Inventory (76,500)
Adjustment of current liabilities:
Accounts payable 19,000
Income taxes payable (4,400)
Net Cash Flow from operations $145,600
Financing Activities:
Common Stock $61,500
Dividend paid 92,000
Net Cash Flow from financing activities $153,500
Investing Activities:
Equipment purchase $41,000
Net Cash Flow from investing activities $41,000
Net Cash Flow $340,100
Explanation:
The Golden Corp.'s statement of cash flows depicts the flow of cash under three main activity headings: operating, financing, and investing. There are two methods under which Golden Corp. can prepare the statement. They include the indirect method, which starts from the net income, adjusts the non-cash expenses and the changes in working capital, and the direct method, which shows the cash inflows and outflows for each cash flow item.
The cash flow for the company is analyzed below:
Net Income before taxes $167,000
Add: non-cash expenses:
Depreciation $54,000
Adjustment of current assets:
Accounts receivable (13,500)
Inventory (76,500)
Adjustment of current liabilities:
Accounts payable 19,000
Income taxes payable (4,400)
Net Cash Flow from operations $145,600
Financing Activities:
Common Stock $61,500
Add: Dividend paid 92,000
Net Cash Flow from financing activities $153,500
Investing Activities:
Equipment purchase $41,000
Net Cash Flow from investing activities $41,000
Net Cash Flow $340,100
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A company issues a ten-year bond at par with a coupon rate of 6.4% paid semi-annually. The YTM at the beginning of the third year of the bond (8 years left to maturity) is 9.1%. What is the new price of the bond?
Answer:
[tex]\mathbf{current \ price \ of \ the \ bond= \$848.78}[/tex]
Explanation:
The current price of the bond can be calculated by using the formula:
[tex]current \ price \ of \ the \ bond= ( coupon \times \dfrac{ (1- \dfrac{1}{(1+YTM)^{no \ of \ period }})}{YTM} + \dfrac{Face \ Value }{(1+YTM ) ^{no \ of \ period}}[/tex]
[tex]current \ price \ of \ the \ bond= ( \dfrac{0.064 \times \$1000}{2} \times \dfrac{ (1- \dfrac{1}{(1+ \dfrac{0.091}{2})^{8 \times 2}})}{\dfrac{0.091}{2}} + \dfrac{\$1000 }{(1+\dfrac{0.091}{2} ) ^{8 \times 2}})[/tex]
[tex]current \ price \ of \ the \ bond= \$32 \times $11.19 + \$490.70[/tex]
[tex]current \ price \ of \ the \ bond= \$358.08+ \$490.70[/tex]
[tex]\mathbf{current \ price \ of \ the \ bond= \$848.78}[/tex]
Which of the following is a characteristic of both the sales approach for service-type warranties and the expense approach for assurance-type warranties?
a. Estimated liability under warranties
b. Warranty expense
c. Unearned warranty revenue
d. Warranty revenue
Answer: Unearned warranty revenue
Explanation:
Unearned warranty revenue is usually shown as an unearned revenues in the accrued liabilities during the preparation of the balance sheets.
It should be noted that the unearned warranty revenue is a characteristic of both the sales approach for service-type warranties and the expense approach for assurance-type warranties.
The manufacturer Mike and Ike, the fruit-flavored chewy candies, has changed its packaging and developed contests all geared to 12- to 17-year-olds. What type of market segmentation identifies its market
Answer:
Demographic
Explanation:
A market is segmented so as to narrow down a large market into a narrow base, or a target market. This helps the organization to be better focused on providing its services to these target groups of people. A market can be segmented on the basis of demography, psychography, behavior, and geography. Demography deals more with statistical data of the population being studied and would typically include; age, gender, race, income levels, etc.
So, when the manufacturer Mike and Ike changes its packaging and developed contests all geared to 12-17-years-old, he has segmented the market according to demography and age.
Answer:
im sorry
Explanation:
Gugenheim, Inc., has a bond outstanding with a coupon rate of 6.5 percent and annual payments. The yield to maturity is 7.7 percent and the bond matures in 21 years. What is the market price if the bond has a par value of $2,000?
Answer:
Price of bond=$1,753.96
Explanation:
The value of the bond is the present value(PV) of the future cash receipts expected from the bond. The value is equal to present values of interest payment plus the redemption value (RV).
Value of Bond = PV of interest + PV of RV
The value of bond for Gugenheim, Inc can be worked out as follows:
Step 1
Calculate the PV of interest payments
Annual interest payment
= 6.5%% × 2000 = 130
PV of interest payment
PV = A× (1- 1+r)^(-n)
A- 130, r- 7.7, n- 21
= 130 × (1-(1.077)^(-21)/0.077) = 1,332.743
Step 2
PV of redemption Value
PV = RV × (1+r)^(-n)
RV - 2000, r- 7.7%, n- 21
PV = 2000 × (1.077)^(-21) = 421.2115063
Step 3
Price of bond
= 1,332.743 + 421.211
=$1753.955
Price of bond=$1,753.96
Which of the following is true for a company that doesn't adjust their WACC for project risk? a. The company would accept more average risk projects than they should otherwise. b. The company's risk would decrease. c. The company would accept more less than average risk projects than they should otherwise. d. The company would accept more riskier than average projects than they should otherwise.
Answer: d. The company would accept more riskier than average projects than they should otherwise.
Explanation:
A company's Weighted Average Cost of Capital can enable it know the calibre of risk to accept from new project because it shows the business risk of funding current business operations.
If a project will bring more risk to the company, the WACC should be adjusted so that the company will get a fair rate of return from the new project. If they do not adjust the new project for risk, not only will the company not get a fair return but they might also accept riskier projects because they will accept projects that they think have a lower risk than their WACC even though they are higher because they did not adjust their WACC.
Which income statement line item had the largest percentage increase from the prior year to the current year? Current Year Prior Year Sales $120,000 $100,000 Cost of Goods Sold 80,000 60,000 Depreciation Expense 30,000 20,000 Interest Expense 2,000 5,000
Answer:
the depreciation expense increased by 50% during the current year.
Explanation:
Current Year Prior Year % change
Sales $120,000 $100,000 +20%
Cost of Goods Sold $80,000 $60,000 +33.33%
Depreciation Expense $30,000 $20,000 +50%
Interest Expense $2,000 $5,000 -60%
Even though the interest expense changed in a higher percentage (-60%), the question asked for which item increased the most, but the interest expense decreased.
You recently began a job as an accounting intern at Raymond Adventures.
Your first task was to help prepare the cash budget for February and March.
Unfortunately the computer with the budget file crashed and you did not have a backup or even a hard copy.
You ran a program to salvage bits of data from the budget file.
After entering the following data in the budget, you may have just enough information to reconstruct the budget.
Raymond Adventures eliminates any cash deficiency by borrowing the exact amount needed from State Street Bank where the current interest rate is 7 %.
Raymond Adventures pays interest on its outstanding debt at the end of each month.
The company also repays all borrowed amounts at the end of the month as cash becomes available.
Raymond Adventures
Combined Cash Budget
February and March
February March
Beginning cash balance 16,500 ??
Plus: Cash collections ?? 80,200
Plus: Cash from sale of plant assets 0 2,100
Total cash available 107,100 ??
Less: Cash payments
(purchase inventory) ?? 41,500
Less: Cash payments
(operating expenses) 47,900 ??
Total cash payments 98,700 ??
(1) Ending cash balance before
financing ?? 22,900
Minimum cash balance desired 20,000 20,000
Cash excess (deficiency) ?? ??
Financing:
Plus: New borrowings ?? ??
Less: Debt repayments ?? ??
Less: Interest payments ?? ??
(2) Total effects of financing ?? ??
Ending cash balance (1) + (2) ?? ??
Answer:
Beginning cash balance for March= $20,000
Cash collections for February =$90,600
Total cash available for March =$102,300
Cash payments (purchase inventory) for February =$50,800
Cash payments (operating expenses) for March =$37,900
Total cash payments for March =$79,400
Ending cash balance before
financing for February =$8,400
Cash excess (deficiency) for February and March =$- 11,600 $2,900
New borrowings for February and March
=$11,600 $0
Debt repayments for February and March
=$0 -$2,900
Interest payments for February and March
=$0 $0
Ending cash balance for February and March (1) + (2) =$20,000 $20,000
Explanation
Preparation of Raymond Adventures
Combined Cash Budget for February and March
Raymond Adventures Combined Cash Budget for February and March
Beginning cash balance 16,500 20,000
Plus: Cash collections 90,600 80,200
Plus: Cash from sale of plant assets 0 2,100
Total cash available 107,100 102,300
Less: Cash payments
(purchase inventory) 50,800 41,500
Less: Cash payments
(operating expenses) 47,900 37,900
Total cash payments 98,700 79,400
(1) Ending cash balance before
financing 8,400 22,900
Minimum cash balance desired 20,000 20,000
Cash excess (deficiency) -11,600 2,900
Financing:
Plus: New borrowings 11,600 0
Less: Debt repayments 0 -2,900
Less: Interest payments 0 0
(2) Total effects of financing 11,600 -2,900
Ending cash balance (1) + (2) 20,000 20,000
Beginning cash balance for March
Minimum cash balance desired March 20,000
Calculation for Cash collections for February
Total cash available 107,100-Beginning cash balance 16,500=90,600
Calculation for Total cash available for March
Beginning cash balance 20,000
Plus: Cash collections 80,200
Plus: Cash from sale of plant assets 2,100
=102,300
Calculation for Cash payments (purchase inventory) for February
Total cash payments 98,700 -Cash payments
(operating expenses) 47,900
=50,800
Calculation for Cash payments (operating expenses) for March
Total cash payments for March 79,400-Cash payments(purchase inventory) for March 41,500
=37,900
Calculation for Total cash payments for March
Total cash available for March 102,300-Ending cash balance before
financing for March 22,900
=79,400
Calculation for the Ending cash balance before
financing for February
Total cash available 107,100-Total cash payments 98,700
=8,400
Calculation for Cash excess (deficiency) for February and March
Ending cash balance before
financing 8,400 22,900
Less Minimum cash balance desired 20,000 20,000
=- 11,600 2,900
New borrowings for February and March
11,600 0
Debt repayments for February and March
0 -2,900
Interest payments for February and March
0 0
Calculation for Ending cash balance for February and March (1) + (2)
(1) Ending cash balance before
financing 8,400 22,900
Add (2) Total effects of financing 11,600 -2,900
=20,000 20,000
Levine Inc. is considering an investment that has an expected return of 15% and a standard deviation of 10%. What is the investment's coefficient of variation
Answer: 0.67
Explanation:
From the question, we are informed that Levine Inc. is considering an investment that has an expected return of 15% and a standard deviation of 10%.
The investment's coefficient of variation will be the standard deviation divided by the expected return. This will be:
= 10/15
= 0.67
Dan would like to save $1,500,000 by the time he retires in 30 years and believes he can earn an annual return of 8%. How much does he need to invest in each of the following years to achieve his goal?
a. $13,241
b. $133,239
c. $10,727
d. $52,450
Answer:
$13,241
Explanation:
From the data we were given in the question:
future value = fv = $1,500,000
time = t = 30 year
rate = r = 8%
We are required to find out How much does he need to invest to achieve his goal
solution
future value = principal ( 1+ rate)^(t-1) / rate
1500000 = principal (1 + .08)^(30-1)/ 0.08
we make principal, p, subject of the formula.
principal = 1500000 / ( (1 + .08)^(30-1)/ 0.08 )
Principal = 1,500,000 / 113.2832
principal = 13241.15
so Dan needs to invest $13241
Computer equipment was acquired at the beginning of the year at a cost of $57,000 that has an estimated residual value of $9,000 and an estimated useful life of five years. Determine the second-year depreciation using the straight-line method.
Answer:
$9,600
Explanation:
When you use the straight line depreciation method, the depreciation expense is the same for every year. The only difference can result if the asset was purchased during the year, and the depreciation for year 1 would only be partial and proportionate to the number of months of use.
In this case, the depreciation expense per year = (purchase price - residual value) / useful life = ($57,000 - $9,000) / 5 = $48,000 / 5 = $9,600 per year (the depreciation expense is the same for all the five years).
Talk to your mentor, family members, or relatives between the ages of 25-30 and who are employed to see what their budgets look like. Develop a sample budget for someone aged 25 to 30 years old
Answer:
Household budget for someone aged 25 to 30 is given below.
Explanation:
Income $1,200
Particulars Budget Amount Actual Expense Difference
House Rent $300 $300 0
Utility Bills $85 $93 -8
Groceries $195 $175 20
Clothing expense $50 $78 -28
Entertainment $20 $55 -35
Laundry $5 $6 -1
Study material $10 $25 -15
Harold Manufacturing produces denim clothing. This year, it produced 5,260 denim jackets at a manufacturing cost of $42 each. These jackets were damaged in the warehouse during storage Management investigated the matter and identified three alternatives for these jackets.
1. Jackets can be sold to a second-hand clothing shop for $8.00 each
2. Jackets can be disassembled at a cost of $31,800 and sold to a recycler for $12.00 each.
3. Jackets can be reworked and turned into good jackets. However, with the damage, management estimates it will be able to assemble the good parts of the 5,260 jackets into only 3,050 jackets. The remaining pieces of fabric will be discarded. The cost of reworking the jackets will be $102,200, but the ackets can then be sold for their regular price of $45.00 each.
Required:
Calculate the incremental income.
Answer:
Incremental net income = $42,080
Explanation:
Note the the income would be that which result from the alternative action with the highest net income Note that the manufacturing cost of $12 per unit is not relevant for the purpose of this decision and hence would not form part of the analysis
$
Option one: Outright sale
Sales from disposal = 5,260× 8 42,080
Option 2: disassembling
Revenue $12 × 5,260 = 63120
Cost of disassembling ( 31,800)
Net income 31,320
Option 3: Reworking
Sales revenue ($45.00× 3,050) 137250
Cost of reworking (102,200)
Net income 35,050
The outright option gives the highest net income hence should be considered.
Incremental net income = $42,080
Alternative 2
Explanation:
XYZ Corporation’s bonds have 14 years remaining to maturity. Interest is paid annually, the bonds have a $1,000 par value, and the coupon interest rate is 10%. The bonds sell at a price of $950. What is their yield to maturity? Show your work.
Answer:
The answer is 10.71%
Explanation:
N(Number of periods) = 14 years
I/Y(Yield to maturity) = ?
PV(present value or market price) = $950
PMT( coupon payment) = $100 ( 10 percent x $1,000)
FV( Future value or par value) = $1,000.
We are using a Financial calculator for this.
N= 14; PV= -950 ; PMT = 100; FV= $1,000; CPT I/Y= 10.71
Therefore, the yield to maturity of the bond is 10.71%
At the beginning of its current fiscal year, Willie Corp.’s balance sheet showed assets of $11,400 and liabilities of $5,700. During the year, liabilities decreased by $1,200. Net income for the year was $3,050, and net assets at the end of the year were $6,150. There were no changes in paid-in capital during the year.
Required:
Calculate the dividends, if any, declared during the year.
Stockholders' Equity
Assets = Liabilities + PIC + RE
Beginning $11,900 = $6,300 + 0 +
Changes = (1,200) + 0 +
Ending = + +
Answer:
$8,750
Explanation:
ASSETS = LIABILITIES + PAID IN CAPITAL + RETAINED EARNINGS
beginning of the year:
$11,400 = $5,700 + paid in capital + retained earnings
paid in capital + beginning retained earnings = $5,700
end of the year:
$6,150 = $4,500 + paid in capital + retained earnings
paid in capital + ending retained earnings = $1,650
ending retained earnings = beginning retained earnings + net income - dividends = beginning retained earnings + $3,050 - dividends
paid in capital + beginning retained earnings - $5,700 = 0
paid in capital + beginning retained earnings + $3,050 - dividends - $1,650 = 0
let X = paid in capital
let Y =beginning retained earnings
X + Y - $5,700 = X + Y + $3,050 - dividends
we eliminate X and Y
-$5,700 = $3,050 - dividends
dividends = $5,700 + $3,050 = $8,750
The five generic types of competitive strategy are not characterized by a ________ provider strategy. Multiple Choice best-cost broad low-cost focused differentiation focused low-cost focused high-cost
Answer:
focused high-cost.
Explanation:
The five generic types of competitive strategy developed by Porter are:
low-cost provider strategiesbroad differentiation strategiesbest-cost provider strategies,focused low-cost strategiesfocused differentiation strategiesPorter's five generic types of competitive strategy were developed to assist an organization to develop a strategy that makes the company in a competitive position in the market, these strategies are based on three fundamental principles: cost leadership, differentiation and the focus.
According to the author, these bases would lead companies to implement offensive or defensive strategic actions that would lead to gaining advantages in relation to their competitors.
Therefore, The five generic types of competitive strategy are not characterized by a focused high-cost provider strategy
Starbucks (Croatia). Starbucks opened its first store in Zagreb, Croatia, in October 2010. In Zagreb, the price of a tall vanilla latte is 25.70 Croatian kunas (kn or HRK). In New York City, the price of a tall vanilla latte is $2.65. The exchange rate between Croatian kunas and U.S. dollars is kn5.6288.
(a) According to purchasing power parity, is the Croatian kuna overvalued or undervalued?
(b) By what percent is the kuna overvalued or undervalued?
Answer:
a. Overvalued
b. 72.3% overvalued
Explanation:
a. Purchasing power parity when held, shows that prices of a specific good is the same across the world.
Price in New York = $2.65
Price in Zagreb = kn25.70
$1 = 25.70/2.65
$1 = kn9.6981
According to PPP, Croatian Kuna is Overvalued as the exchange rate per the Vanilla Latte is higher than the official exchange rate.
b. = [tex]\frac{9.6981 - 5.6288}{5.6288.}[/tex]
= [tex]\frac{4.0693}{5.6288}[/tex]
= 72.3% overvalued
The Polishing Department of Bonita Company has the following production and manufacturing cost data for September. Materials are entered at the beginning of the process. Production: Beginning inventory 1,580 units that are 100% complete as to materials and 30% complete as to conversion costs; units started during the period are 41,200; ending inventory of 6,600 units 10% complete as to conversion costs.
Manufacturing costs: Beginning inventory costs, comprised of $20,600 of materials and $14,674 of conversion costs; materials costs added in Polishing during the month, $186,883; labor and overhead applied in Polishing during the month, $127,600 and $257,440, respectively.
Required:
a. Compute the equivalent units of production for materials and conversion costs for the month of September.
b. Compute the unit costs for materials and conversion costs for the month.
c. Determine the costs to be assigned to the units transferred out and in process.
Answer:
a. materials = 42,780 and conversion costs = 36,840
b. materials = $4.85 and conversion costs = $10.85
c. units transferred out = $568,026 and in process = $39,171
Explanation:
First calculate the number of units completed and transferred out of the Polishing Department.
Units completed and transferred out = 1,580 + 41,200 - 6,600
= 36,180
Calculation of equivalent units of production for materials and conversion costs for the month of September
materials
Units completed and transferred out (36,180 × 100%) = 36,180
Units of Ending Work In Process (6,600 × 100%) = 6,600
Total equivalent units of production for materials = 42,780
conversion costs
Units completed and transferred out (36,180 × 100%) = 36,180
Units of Ending Work In Process (6,600 × 10%) = 660
Total equivalent units of production for conversion costs = 36,840
Calculate the unit costs for materials and conversion costs for the month
Unit costs for materials = Total Cost for materials / Total equivalent units of production for materials
= ( $20,600 + $186,883) / 42,780
= $4.85
Unit costs for conversion costs = Total Cost for conversion costs / Total equivalent units of production for conversion costs
= ( $14,674 + $127,600 + $257,440) / 36,840
= $10.85
Total unit cost = $4.85 + $10.85
= $15.70
Calculate the costs to be assigned to the units transferred out and in process.
Cost units transferred out = Number of Units Transferred out × Total Unit Cost
= 36,180 × $15.70
= $568,026
Cost of Units In Process Calculation :
Material Cost ( 6,600 × $4.85) = $32,010
Conversion Costs ( 660 × $10.85) = $7,161
Total Cost of Units In Process = $39,171
Currently Baldwin is paying a dividend of $19.69 (per share). If this dividend were raised by $3.64, given its current stock price what would be the Dividend Yield?
Answer:
$23.33
Explanation:
Calculation for the Dividend yield for Baldwin
Using this formula
Dividend yield = Dividend per share + Increase in Dividend
Let plug in the formula
Dividend yield = $19.69+$3.64
Dividend yield =$23.22
Therefore the Dividend yield will be $23.22
Grouper Architects incorporated as licensed architects on April 1, 2022. During the first month of the operation of the business, these events and transactions occurred:
Apr. 1 Stockholders invested $22,410 cash in exchange for common stock of the corporation.
1 Hired a secretary-receptionist at a salary of $467 per week, payable monthly.
2 Paid office rent for the month $1,120.
3 Purchased architectural supplies on account from Burmingham Company $1,618.
10 Completed blueprints on a carport and billed client $2,365 for services.
11 Received $871 cash advance from M. Jason to design a new home.
20 Received $3,486 cash for services completed and delivered to S. Melvin.
30 Paid secretary-receptionist for the month $1,868.
30 Paid $373 to Burmingham Company for accounts payable due.
Journalize the transactions. (If no entry is required, select "No entry" for the account titles and enter Ofor the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
Answer:
April 1.
Cash $22,410 (debit)
Common Stock $22,410 (credit)
April 1.
Salaries Expense $1,868 (debit)
Salaries Payable $1,868 (credit)
April 2.
Rent Expense $1,120 (debit)
Cash $1,120 (credit)
April 3.
Supplies $1,618 (debit)
Account Payable : Burmingham Company $1,618 (credit)
April 10.
Accounts Receivables $2,365 (debit)
Service Revenue $2,365 (credit)
April 11.
Cash $871 (debit)
Unearned Revenue $871 (credit)
April 20.
Cash $3,486 (debit)
Service Revenue $3,486 (credit)
April 30.
Salaries Payable $1,868 (debit)
Cash $1,868 (credit)
April 1.
Account Payable : Burmingham Company $1,618 (debit)
Cash $1,618 (credit)
Explanation:
Note the following :
1.Revenue received but not earned is recorded in a liability account known as Unearned Revenue.This account will subsequently be de-recognized as the revenue is earned.
2. When the Suppliers are paid amounts owing to them, de-recognize the Accounts Payable Account of those suppliers and also de-recognize the Cash Assets.
"The following per unit cost information is available: direct materials $10, direct labor $4, variable manufacturing overhead $3, fixed manufacturing overhead $10, variable selling and administrative expenses $1, and fixed selling and administrative expenses $8. Using a 25% markup percentage on total per unit cost, compute the target selling price."
Answer:
The target selling price =$45
Explanation:
The target selling price is the sum of the total unit cost plus 25% of the the unit cost
The target selling price = Total per unit cost + (25% × total unit cost)
The total unit cost is the sum of all the costs involved making the product available to the consumer.
The sum of direct material cost , labour cost variable manufacturing, fixed manufacturing overhead, variable selling and administrative expenses and fixed selling and administrative expenses.
The target selling price would be determined using te steps below:
Step 1: Calculate the unit cost
Total unit cost = 10 + 4 + 3 + 10 + 1 + 8 = 36
Total unit cost = $36
Step 2: Calculate the target selling price
Target selling price = Unit cost + (25%× unit cost)
The target selling price = 36 + (25% × 36) = $45
The target selling price =$45