Answer:
Sheridan Corporation
Journal Entries:
1. Debit Raw Materials Inventory $46,600
Credit Accounts Payable $46,600
To record purchase of raw materials on account.
2. Debit Direct Raw Materials $33,800
Debit Indirect Raw materials $7,000
Credit Inventory $40,800
To record the requisitioning of raw materials to the factor.
4. Debit Direct labor $55,700
Debit Indirect labor $4,600
Credit Cash Account $60,300
To record labor costs incurred.
5. Debit Manufacturing Overhead $83,700
Credit Cash account $83,700
To record manufacturing overhead cost.
6. Debit Depreciation $8,900
Credit Accumulated Depreciation $8,99
To record the depreciation expense for the period.
7. Debit Manufacturing Overhead $5,420
Underapplied Manufacturing Overhead $5,420
To record underapplied manufacturing overhead.
8. Debit Finished Goods Inventory $93,500
Credit Cost of Production $93,500
To transfer completed goods.
9. Debit Cost of Goods Sold $85,100
Credit Finished Goods Inventory $85,100
To record the cost of finished goods.
Explanation:
Journal entries are made to record business transactions. They help classified transactions according to their whether they are to be debited or credit.
During 2012, Robby's Camera Shop had sales revenue of $170,000, of which $75,000 was on credit. At the start of 2012, Accounts Receivable showed a $16,000 debitbalance, and the allowance for Doubtful Accounts showed a $900 credit balance. Collections of accounts receivable during 2012 amounted to $60,000.
Data during 2012 follows:
a. On December 31, 2012, an Account Receivable (J. Doe) of $1,700 from a prior year was determined to be uncollectable; therefore, it was written off immediately as abad debt.
b. On December 31, 2012, on the basis of experience, a decision was made to continue the accounting policy of basing estimated bad debt losses on 1.5 percent of creditsales for the year.
REQUIRED:
1. Give the required journal entries for the two items on December 31, 2012 (end of the accounting period).
2. Show how the amounts related to Accounts Recievable and Bad Debt Expense would be reported on the income statement and balance sheet for 2012. Disregard income taxconsiderations.
3. On the basis of the data available, does the 1.5 percent rate appear to be reasonable? Explain
Answer:
1) December 31, 2012, bad debt write off
Dr Bad debt expense 1,700
Cr Accounts receivable 1,700
December 31, 2012
Dr Bad debt expense 1,125
Cr Allowance for doubtful accounts 1,125
2) Bad debt expense must be recorded in the income statement and it reduces net income. Both transactions reduce net accounts receivable on the balance sheet.
3) It doesn't seem to be appropriate because just one bad account (J. Doe) was higher than 1.5%. A large % of accounts receivable is still outstanding (= $27,275 / $75,000 = 36.4%) and they should include approximately four months of credit sales. This means that unless the company issues a very long credit, a much larger percent is past due.
Explanation:
net accounts receivable January 1, 2012 = $15,100
credit sales 2012 = $75,000
collections on accounts receivable $60,000
net accounts receivable December 31 = $15,100 + $75,000 - $60,000 - $1,700 - $1,125 = $27,275
Harvey Industries, a Wisconsin company, specializes in the assembly of high-pressure washer systems and in the sale of repair parts for these systems. The products range from small portable high-pressure washers to large industrial installations for snow removal from vehicles stored outdoors during the winter months. Typical uses for high-pressure water cleaning include:_______
Answer:
1. Airplanes.
2. Ice-cream plants.
3. Building maintenance.
4. Engines.
5. Automobiles.
6. Barns.
7. Lift trucks.
8. Swimming pools.
9. Machinery.
Explanation:
In this scenario, Harvey Industries, a Wisconsin company, specializes in the assembly of high-pressure washer systems and in the sale of repair parts for these systems. The products range from small portable high-pressure washers to large industrial installations for snow removal from vehicles stored outdoors during the winter months.
Basically, the high-pressure water cleaning is a process that involves using water running at a very high pressure and sometimes high temperature to remove mold, dirt, dusts, loose paint, snow removal, grime etc from physical objects such as vehicles, equipments, buildings, billboards through the use of a plunger pump.
The typical uses for high-pressure water cleaning include: Airplanes, Ice-cream plants, Building maintenance, Engines, Automobiles, Barns, Lift trucks, Swimming pools, Machinery etc.
The proper application of high-pressure water cleaning helps to reduce environmental degradation, ensure equipments or environment are clean and neat. Also, high and tight places that cannot be easily reached by humans can still be cleaned with the help of a high-pressure water cleaner.
The Securities and Exchange Commission and the Federal Aviation Administration are examples of agencies engaged in A. the regulation of nonmonopolistic industries. B. health and safety regulation. C. social regulation. D. the regulation of natural monopolies.
Answer:
A. the regulation of nonmonopolistic industries.
Explanation:
The Securities and Exchange Commission and the Federal Aviation Administration are examples of agencies engaged in the regulation of nonmonopolistic industries.
A nonmonopolistic industry is one that is characterized by competition among various service providers in a country and generally there's a government agency that regulates their actions and activities in the public.
The Securities and Exchange Commission (SEC) is a governmental agency saddled with the sole responsibility of regulating the securities or capital markets, as well as protecting investors in a country.
In the U.S, the Securities and Exchange Commission (SEC) as an independent government agency was established under the Securities Act of 1933 and the Securities and Exchange Act of 1934 of the United States of America.
Hence, SEC has the power to propose securities rules and regulations, and enforce federal securities law in the securities market.
The Federal Aviation Administration (FAA) was founded on the 23rd of August, 1958 under the Federal Aviation Act of 1958 of the United States of America. It is an independent government agency with the responsibility of regulating civil aviation, commercial space transportation, construction and maintenance of airports, air traffic management and operations of navigation systems for both civil and military aircrafts, and issuance of licenses to airline operators with their personnel.
An asset has an average return of 10.19 percent and a standard deviation of 22.41 percent. What is the most you should expect to lose in any given year with a probability of 16 percent
Answer:
The answer is 32.6%
Explanation:
Solution
Given that
An assets has a return average of =10.19%
Standard deviation =22.41%
Probability in any given year =16%
Now
The most you should expect to earn in any given year with a probability of 16 percent is = 10.19 + 22.41
= 32.6
Therefore,what you should expect in given year to lose is 32.6%
Using $3,000,000 as the total manufacturing costs, compute the cost of goods manufactured using the following information.
Raw materials inventory, January 1 $ 20,000
Raw materials inventory, December 31 40,000
Work in process, January 1 18,000
Work in process, December 31 12,000
Finished goods, January 1 40,000
Finished goods, December 31 32,000
Raw materials purchases 1,700,000
Direct labor 760,000
Factory utilities 150,000
Indirect labor 50,000
Factory depreciation 400,000
Operating expenses 420,000
a. $3,014,000
b. $3,006,000
c. $3,008,000
d. $2,994,000
Answer:
$3,006,000
Explanation:
The computation of cost of goods manufactured is shown below:-
Cost of Goods Manufactured = Gross Manufacturing Cost + Opening Work in progress - Closing work in progress
= $3,000,000 + $18,000 - $12,000
= $3,006,000
Therefore for computing the cost of goods manufactured we have applied the above formulas and ignore all other values as they are not relevant.
Question 2 (10 Marks)
In Andalusia Ltd, wages are paid on a weekly basis (40 hours per week) at a guaranteed hourly rate
of RM2.80. It is estimated that the time required to manufacture a particular product was 12 minutes.
However, the time allowed of 25% is to be added (for normal idle time, setting up time, etc.). During
the first week of June 2020, Roslan produced 250 units of the product.
Required:
Compute Roslan's wages for the particular week using the following methods of wage payment:
a. time rate.
[2 marks]
b. piece rate with a guaranteed weekly wage.
[3 marks]
c. Halsey's premium bonus scheme.
[5 marks]
Answer:
Andalusia LtdWages based on:a. Time rate = RM 2.80 x 40 hours = RM 112
b. Piece Rate = RM 0.70 x 250 units = RM 175
c. Halsey premium bonus scheme:
Pay per hour = RM 2.80,
Therefore Wages = Normal Wages + Bonus
= (RM 2.80 x 40) + 50% (RM 2.80 x 22.5)
= RM 112 + 31.5 = RM 143.50
Explanation:
a) Time for each product unit = 12
Piece rate = RM 2.80/60 x 15 = RM 0.70 per unit
b) Under Halsey Premium Bonus Scheme:
Hours used in production = 40 hours
Hours for producing 250 units = 62.5 hours
Gain in hours = 22.5 hours (62.5 - 40)
c) Time rates are wages based on the amount of time spent at work. The usual form of time rate is the weekly wage or monthly salary. Usually the time rate is fixed in relation to a standard working week (e.g. 40 hours per week).
d) Wages based on piece rate (also known as piecework) is a pay based on number of units or pieces created rather than the number of hours worked. In other words, the more “pieces” an employee produces, the more the employee is paid.
e) Under Halsey Plan, the standard time for the completion of a job is fixed and the rate per hour is then determined. The usual bonus share paid to the worker is 50% of the time saved multiplied by the rate per hour (time-rate).
An investor with an investment objective of tax-exempt income will need access to the funds in four months. An RR should not recommend which of the following municipal securities?
A. A variable-rate demand obligation (VRDO)B. An auction-rate security (ARS)C. A tax-anticipation note (TAN)D. A bond anticipation note (BAN)
Answer:
B. An auction-rate security (ARS)
Explanation:
An auction-rate security (ARS) is a debt security (either municipal or corporate securities) with long-term maturities usually between 20 to 30 years and has its interest rates reset periodically through dutch auctions, such as every 7, 14, 28, 35, 49, or 91 days.
Also, an auction-rate security (ARS) is typically structured as preferred equity securities, which are issued by closed-end funds.
An auction-rate security (ARS) and a variable rate demand obligation (VRDO) are both long-term securities having short-term trading features.
Generally, an auction rate security (ARS) doesn't have a put feature that would permit the holder to sell the securities to a third party or back to the issuer of the securities. Thus, if the dutch auction fails, the investor in question wouldn't have an immediate access to his funds.
Hence, RR should NOT recommend an auction-rate security (ARS) since investor will need access to the funds in four months.
Lastly, tax-anticipation note (TAN) and bond anticipation note (BAN) are both short-term municipal notes and can easily be sold in the secondary market if their maturities is above four (4) months in duration.
Oscar owns a building that is destroyed in a hurricane. His adjusted basis in the building before the hurricane is $130,000. His insurance company pays him $140,000 and he immediately invests in a new building at a cost of $142,000. What is Oscar's basis on his new building?
Answer: $132,000
Explanation:
Oscar's new basis on the building will be the basis of the old building plus any additional investment he added.
This is the because there is no gain on the $140,000 he received because it was an Involuntary Conversion amount and he reinvested it into another building within a period of 2 years.
As there is no gain, the building will retain it's original basis but will add any amount outside the involuntary replacement cost of the building.
The Additional basis will be,
= Cost of building - Insurance
= 142,000 - 140,000
= $2,000
The Basis for the new building is,
= 130,000 + 2,000
= $132,000
Crane Company reports: Cash provided by operating activities $ 310000 Cash used by investing activities 120000 Cash provided by financing activities 149000 Beginning cash balance 98000 What is Crane’s ending cash balance?
Answer:
$437,000
Explanation:
We first, find the net cash flow for the current period, and then, add the cash balance for the period immediately before.
Net cash flow for current period:
Cash provided by operating activities $310,000
Cash used by investing activities ($120,000) - we substract this because the cash was "used", that is to say, it was spent.
Cash provided by financing activities $149,000
Net cash flow: $339,000
Ending cash balance = Net cash flow + beginning cash balance
= $339,000 + 98,000
= $437,000
Consider an assembly line with 20 stations. Each station has a 0.5% probability of making a defect. At the end of the line, an inspection step singles out the defective units. The inspection step catches 80% of all defects. From inspection, units that are deemed to be non-defective
are moved to the shipping department.
If a defect is found at inspection, it is sent to the rework department.
Rework fixes about 95% of the defective units. Units are directly shipped from the rework department with no further inspection taking place.
1- What is the probability that a unit ends up in rework (in decimal form)?
2- What is the probability that a defective unit is shipped (in decimal form)?
Answer:
Assembly Line1. Probability that a unit ends up in rework = Probability of defect in 20 stations multiplied by the probability of catching defects = 0.8%(1% x 80%) = 0.008
2. Probability that a defective unit is shipped = Probability of defective units during inspection plus Probability of defective units during rework = 25% (20% + (100-95%)) = 0.25
Explanation:
a) Probability of defect in 20 stations = 0.5% x 20 = 1%. Each station has a 0.05%
b) Probability of defective units during inspection = 20% (100% - 80)
c) Probability of defective units during rework = 5% (100% -95)
c) Probability is the likelihood or chance of an event occurring. Divide the number of events by the number of possible outcomes. This will give us the probability of a single event occurring.
Biarritz Corp. is growing quickly. Dividends are expected to grow at a rate of 29 percent for the next three years, with the growth rate falling off to a constant 6.8 percent thereafter. If the required return is 15 percent and the company just paid a dividend of $3.15, what is the current share price
Answer:
The current price of the share is $69.85
Explanation:
To calculate the current share price, we will use the dividend discount model approach.
The dividend discount model (DDM) estimates the value of a share/stock based on the present value of the expected future dividends from the stock. We will use the two stage growth model of DDM here as the growth in dividends of the stock is divided into two stages.
The formula for current price under two stage growth model is,
P0 = D0 * (1+g1) / (1+r) + D0 * (1+g1)^2 / (1+r)^2 + ... + D0 * (1+g1)^n / (1+r)^n +
[( D0 * (1+g1)^n * (1+g2)) / (r - g2)] / (1+r)^n
Where,
g1 is initial growth rateg2 is the constant growth rater is the required rate of returnSo, the price of the stock today will be,
P0 = 3.15 * (1+0.29) / (1+0.15) + 3.15 * (1+0.29)^2 / (1+0.15)^2 +
3.15 * (1+0.29)^3 / (1+0.15)^3 +
[( 3.15 * (1+0.29)^3 * (1+0.068)) / (0.15 - 0.068)] / (1+0.15)^3
P0 = $69.85196 rounded off to $69.85
Complete the following table by indicating whether or not each scenario is an example of price discrimination.
Hint: In order to determine if a scenario is an example of price discrimination, think about if the market can be segmented into two groups that pay different prices for the same good.
Scenario
Price Discrimination
Yes
No
Last-minute "rush" tickets can be purchased for most Broadway theater shows at a discounted price. They are typically distributed via lottery or on a first-come, first-served basis a few hours before the show. Assume that the theater in question does not hold seats in reserve for this purpose, but rather offers rush tickets only for seats not sold before the day of the performance. A local boutique is having a sale on sweaters, but customers are not aware of the sale until they are already in the store. In other words, there is no advertising of the sale other than signs in the back of the store that cannot be seen from the outside. All sweaters are marked as 55% off.
Answer:
a. Yes
b. No
Explanation:
Price discrimination refers that selling the products the same product to different customers at different prices so that they can increase their sales and profits.
A. According to the given situation, the correct answer is yes as the discounted tickets are awarded on the basis of lottery or first come on the basis of first served.
b. Now, according to the second situation, the correct answer is no as it is not an advertising item as is it within the store and has no information outside the store.
Ownership of retail outlets may be necessary if: a. products are expended in consumption. b. products are inexpensive. c. the products produced by the manufacturer are not complex. d. products are intended for one-time use. e. the required standards of after-sales service for complex products are to be maintained.
Answer:
E. The required standards of after-sales service for complex products are to be maintained.
Explanation:
The standard of after sale service is necessary in a case like this because after sales service is said to be all you need to know regarding or concerning the product you bought or the services that has been rendered to you.
In as much as a market can be any arrangement where buying and selling is been done and the online platform or medium is pulling through in a lot of sales in recent times, retail outlets show not to be always necessary but sometimes can be necessary in a critical case such as the above scenario. Here, the required standards of after sales services for some products which are complex is to be maintained, retail outlets are said to be possibly necessary.
Due to population shifts, Select one: a. businesses that cater to older consumers will see slower growth. b. health care will emerge as the only business sector that will grow. c. businesses that sell electronic devices will see a significant decline. d. businesses that cater to older consumers will see higher growth.
Answer: d. businesses that cater to older consumers will see higher growth
Explanation:
The trend in the Developed World is that of lower birth rates and higher life expectancies. This has and will keep leading to more of the population being from the Older generation. This is a population shift towards the older generation.
Should this happen, Businesses and products that were made for the older generation will see their business grow as they will have more customers which equates to more demand which equates to higher profitability.
Dynamo Corporation manufactures toasters. Each toaster comes with a 5-year assurance-type warranty. The toasters sell for $60 each. During Year 1, Dynamo sells 600 toasters, for cash. Past experience shows that the average warranty costs are $4 each or $2,400 for these toasters. In Year 1, Dynamo pays $500 cash for warranty costs on the toasters sold that year. Required: Prepare Dynamo’s journal entries related to the sales and warranty in Year 1.
Answer:
Journal entry to record sale of toasters and warranty
Dr Cash 36,000
Cr Sales revenue 36,000
Dr Warranty expense 2,400
Cr Warranty liability 2,400
Adjusting entry for actual warranty expense
Dr Warranty liability 500
Cr Cash 500
Since the warranty covers a 5 year period, the remaining warranty expense cannot be recognized as warranty revenue yet. Only after the warranty period is over, will any money left over will be recognized as revenue.
Read the following paragraphs about four films and then identify the purpose of each paragraph: to summarize, to analyze, to synthesize, or to evaluate.
1. This film could easily have been cut down to less than two hours. By the final scene, I noticed that most of my fellow moviegoers were snoozing in their seats and were barely paying attention to what was happening on screen. Although the director sticks diligently to the book, he tries too hard to cram in all the action, which is just too ambitious for such a detail-oriented story. If you want my advice, read the book and give the movie a miss.
2. During the opening scene, we learn that the character Laura is adopted and that she has spent the past three years desperately trying to track down her real parents. Having exhausted all the usual options—adoption agencies, online searches, family trees, and so on—she is on the verge of giving up when she meets a stranger on a bus. The chance encounter leads to a complicated chain of events that ultimately result in Laura getting her lifelong wish. But is it really what she wants? Throughout the rest of the film, Laura discovers that sometimes the past is best left where it belongs.
3. To create the feeling of being gripped in a vice, the director, May Lee, uses a variety of elements to gradually increase the tension. The creepy, haunting melody that subtly enhances the earlier scenes becomes ever more insistent, rising to a disturbing crescendo toward the end of the movie. The desperation of the actors, combined with the claustrophobic atmosphere and tight camera angles create a realistic firestorm, from which there is little hope of escape. Walking out of the theater at the end feels like staggering out of a Roman dungeon.
4. The scene in which Campbell and his fellow prisoners assist the guards in shutting down the riot immediately strikes the viewer as unrealistic. Based on the recent reports on prison riots in both Detroit and California, it seems highly unlikely that a posse of hardened criminals will intentionally help their captors at the risk of inciting future revenge from other inmates. Instead, both news reports and psychological studies indicate that prisoners who do not actively participate in a riot will go back to their cells and avoid conflict altogether. Examples of this lack of attention to detail occur throughout the film, making it almost unbearable to watch.
Answer: 1. To Evaluate
2. To Summarize
3. To Synthesize
4. To Analyze
Explanation:
1. When evaluating a work the main goal is to determine its worth and this is usually done based on previous perceptions as well as set standards. The person is statement 1 gives their opinion of the movie basing it off of the director being too ambitious. They give the film a low value because people were sleeping through it and then offer their opinion that the book should be read and the movie avoided.
2. When summarising the main purpose is to convert the large amount of information available to a smaller and more concise format from which the main idea of the work can be discovered immediately. The owner of the second statement made you as the reader know what happened in the film in not too many words so you get the main idea.
3. When works are synthesized, the author makes note of different things and then brings them together to form something entirely new. The author of this statement notes how the various elements were used to entice the viewer such as the music, the actions of the actors, and the tight camera angles. These are things were not central to the movie but the author made note of them and created a whole new narrative of why the movie was so successful.
4. When analyzing, the work is broken down into its composite parts to see how and if the parts go together. The author of the statement breaks the film down into a composite part which was when the prisoners helped the guards in shutting down the riots. The author then proceeded to explain how this part is not logical and then related this to the entire movie showing that the author also dissected other parts of the film and saw similar behavior.
After reading the following paragraphs about four films and then identifying the purpose of each paragraph the conclusion made is:
1. To Evaluate
2. To Summarize
3. To Synthesize
4. To Analyze
The explanation for the following answers are:
1. The fundamental purpose of evaluating a work is to determine its value, which is usually done based on previous perceptions as well as established standards.
Statement 1 expresses their assessment of the film, citing the director's overabundance as a reason. They give the film a low rating because people were sleeping through it, and then recommend that people read the book instead of watching the movie.
2. The fundamental goal of summarizing is to reduce the enormous amount of material provided to a smaller, more concise format from which the work's key point may be discovered quickly.
The owner of the second statement made you, the reader, aware of what occurred in the film in a few words, allowing you to grasp the key point.
3. When a piece is synthesized, the creator takes notes on several elements and then combines them to create something altogether new. The author of this statement discusses how numerous components, such as music, actor actions, and tight camera angles, were utilised to lure the audience.
These were not crucial to the film, but the author took note of them and built a whole new story about why the film was so popular.
4. When examining a piece of work, it is disassembled into its component components to see how and if they fit together. The statement's author divides the film into a composite section during which the inmates assisted the guards in putting an end to the rioting.
The author then went on to explain why this aspect isn't rational, and then connected it to the rest of the movie, demonstrating that he deconstructed other parts of the movie and noticed similar behavior.
For more information about films refer to the link:
https://brainly.com/question/21733698
On November 7, 2017, Mura Company borrows $360,000 cash by signing a 90-day, 9% note payable with a face value of $360,000. (Use 360 days a year. Do not round your intermediate calculations.) 1. Compute the accrued interest payable on December 31, 2017.
Answer:
The accrued interetst is $4860 and $3240
Explanation:
Solution
Recall that:
Mura Company borrows= $360,000
Time =90/360
rate = 9%
Face value =$360,000
The next step is to compute the accrued interest payable on December 31, 2017.
Now,
Interest = 360000*9%*90/360=8100$
year end interest accrual:
Principal =$360000
time 54/360
Interest =360000*9%*54/360 = $4860
Interest recognized on February 5
Principal =$360000
Rate= 9%
Time= 36/360
Interest 360000*9%*36/360 = $3240
Secular inflation in the United States since 1960 has been most likely be the result of persistent leftward shifts of the aggregate demand curve. persistent rightward shifts of the long-run aggregate supply curve. persistent leftward shifts of the long-run aggregate supply curve. persistent rightward shifts of the aggregate demand curve.
Answer:
Persistent leftward shifts of the aggregate demand curve.
Explanation:
The inflation results in decreasing the aggregate demand. The real spending decreases the value of money. Secular inflation is prolonged period of slight price increase. This type of inflation continues to persist over a long time. The secular inflation in the United States has been due to leftward shift of aggregate demand curve.
Outstanding stock of the Blue Corporation included 50000 shares of $5 par common stock and 18000 shares of 5%, $10 par non-cumulative preferred stock. In 2019, Blue declared and paid dividends of $7500. In 2020, Blue declared and paid dividends of $25000. How much of the 2020 dividend was distributed to preferred shareholders
Answer:
The dividends to be distributed among preferred stockholders in 2020 is $9000
Explanation:
The preferred stock holders are always paid dividends before the common stock holders. The amount left after paying preferred stockholders is paid to common stockholders as dividends.
Non cumulative preferred stock does not accrue or accumulates dividends. Thus, if dividends are not paid in a particular year, the company has no obligation to pay these dividends ever in the future.
Preferred stock dividend per year = 18000 * 10 * 0.05
Preferred stock dividend per year = $9000
As the preferred stock is non cumulative, then the remaining dividends for 2019 (which are 9000 - 7500 = $1500) will not be paid in 2020.
So, the preferred stock dividends to be paid in 2020 will be $9000 as the declared dividends are more than that required to pay the preferred stockholders.
Invested assets, beginning $ 2,692 $ 4,485 Invested assets, ending 2,608 4,415 Sales 2,696 3,940 Operating income 364 649 Assume that each of the company’s divisions has a required rate of return of 5%. Compute residual income for each division
Answer and Explanation:
The computation of the residual income for each division is shown below:
As we know that
Residual income = Operating income - target income
where,
Operating income is given in the question
And, the target income could be calculated by
= Average invested assets × required rate of return
Now
Particulars Beverage Cheese
Division Division
Average assets
{(Open + closing) ÷ 2} $2,650 $4,450
Required rate of return 5% 5%
Target income $132.50 $222.50
So, the residual income is
Particulars Beverage Cheese
Division Division
Operating income $364 $649
Less:
Target income -$132.50 -$222.50
Residual income $231.50 $426.50
The folowing information apples to the questions displayed bełow The financial statements for Highland Corporation included the folowing selected information: Common stock Retained earnings Net income Shares issued Shares outstanding Dividends declared and paid $1,600,000 $ 900,000 1,000,000 90,000 80,000 $ 800,000 The common stock was sold at a price of $30 per share.
Required: 1. What is the amount of additional paid-in capital?
Answer:
The amount of additional paid-in capital is $800,000
Explanation:
1. In order to calculate the amount of additional paid-in capital we would have to make the following calculation:
additional paid-in capital=Total stock price-Common stock
Total stock price=Shares outstanding*sold price common stock
Total stock price=80,000*$30
Total stock price=$2,400,000
Therefore, additional paid-in capital=$2,400,000-$1,600,000
additional paid-in capital=$800,000
The amount of additional paid-in capital is $800,000
Two-Asset Portfolio Stock A has an expected return of 12% and a standard deviation of 45%. Stock B has an expected return of 18% and a standard deviation of 65%. The correlation coefficient between Stocks A and B is 0.2. What is the expected return of a portfolio invested 40% in Stock A and 60% in Stock B
Answer:
Portfolio return = 0.156 or 15.6%
Explanation:
The expected return of a portfolio is the weighted average of the individual stocks returns' that form up the portfolio. For a two stock portfolio, the expected return is calculated as follows,
Portfolio return = wA * rA + wB * rB
Where,
w is the weight of each stockr is the expected return of each stockPortfolio return = 0.4 * 0.12 + 0.6 * 0.18
Portfolio return = 0.156 or 15.6%
A company purchased a tract of land for its natural resources at a cost of $1,500,000. It expects to mine 2,000,000 tons of ore from this land. The salvage value of the land is expected to be $250,000. If 150,000 tons of ore are mined during the first year, the journal entry to record the depletion is:
Answer: Please see below
Explanation:
Depletion expense = Initial price Purchase - Residual value / Total number of units.
$1,500,000 - $250,000/ 2,000,000 = 0.0625 per ton
if 150,000 tons of ore are mined,
Depletion expense = depletion per ton x units mined
0.625 x 150,000=$93,750
journal entry to record the depletion is:
Account Debit Credit
Depletion expense $93,750
Accumulated Depreciation $93,750
Your firm has net income of $385 on total sales of $1,480. Costs are $810 and depreciation is $120. The tax rate is 30 percent. The firm does not have interest expenses. What is the operating cash flow
Answer:
Operating cash flow= 305.5
Explanation:
Giving the following information:
Your firm has net income of $385 on total sales of $1,480. Costs are $810 and depreciation is $120. The tax rate is 30 percent.
EBITDA= 385
Depreciation= (120)
EBIT= 265
Tax= (0.3*265)= (79.5)
Depreciation= 120
Operating cash flow= 305.5
suppose community bank offers to lend you 10000 for one year at a nominal annual rate of 17.75% but you must make interest payments at the end of each quarter and then pay off the $10,000 principal amount at the end of the year. What is the effective annual rate on the loan
Answer:
18.97%
Explanation:
Effective annual rate = (1 + periodic interest rate / m)^m - 1
M = 4
Periodic interest rate = 17.75%
17.75% / 4 = 4. 4375%
(1+0.044375) ^4 - 1 = 18.97%
I hope my answer helps you
Marin Inc. has an investment in trading securities of $143000. This investment experienced an unrealized loss of $7300 during the current year. Assuming a 33% tax rate, the amount of this loss that would reported as part of other comprehensive income would be:
Answer:
This would be the loss on paper only.
Explanation:
Given investment trading securities = $143000
During the current year, the loss experienced on investment = $7300
The tax rate = 33%
However, this loss that is reported as the part of other comprehensive income would be the loss on paper only because the actual loss can be seen when the stock is sold but this unrealized loss is on paper only so there will no effect of this loss in comprehensive income.
Mrs. Kwan withdrew the entire $8,000 balance from her Roth IRA this year. Her total contributions to the account were $6,070, and her marginal tax rate is 12 percent. Determine the tax cost of the withdrawal if: Mrs. Kwan is age 63 and opened the Roth IRA three years ago. Mrs. Kwan is age 63 and opened the Roth IRA seven years ago. Mrs. Kwan is age 48 and opened the Roth IRA seven years ago.
Answer:
$425
Explanation:
The computation of the tax cost of the withdrawal is shown below:-
The withdrawal will not be considered a qualifying withdrawal as Ms. Kwan is not 59 1/2 years old. Therefore, the taxable withdrawal would be subject to an additional 10 percent penalty.
Tax cost of the withdrawal = (Tax rate × (Balance amount - Total contribution) + (Penalty × (Balance amount - Total contribution)
= (12% × ($8,000 - $6,070)) + (10% × ($8,000 - $6,070))
= $231.6 + $193
= $424.6
or
= $425
The greater the number of compounding periods within a year, then (1) the greater the future value of a lump sum investment at Time 0 and (2) the smaller the present value of a given lump sum to be received at some future date. Truie or False
Answer:
True
Explanation:
If there is a more number of compounding periods within a year so it would result into the higher price of future value for lump sum investment in year 0 but the case would be adverse with the present value i.e there is less amount in the present value with regard to lumpsum amount i.e to be recieved in the future date
Hence, the given statement is true
You would like to be holding a protective put position on the stock of XYZ Co. to lock in a guaranteed minimum value of 150 at year-end. XYZ currently sells for 150. Over the next year, the stock price will either increase by 10% or decrease by 10%. The T-bill rate is 5%. Unfortunately, no put options are traded on XYZ Co.
a. How much would it cost to purchase if the desired put option were traded? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Cost to purchase $
b. What would be the cost of the protective put portfolio? (Do not round intermediate calculations. Round your answer to 2 decimal places.)
Cost of the protective put portfolio $
Answer:
a. $3.38
b=$153.38
a. Calculation for how much would it cost to purchase if the desired put option were traded
Calculation for Pd=10/100×150=15
Calculation for uS0=10/100×150=15+150=165
Calculation for dS0=150-15=135
Hence
X=150; uS0= 165; Pu= 0; dS0= 135; Pd= 15
Using this formula to find the Hedge ratio
Hedge ratio :Pu- Pd / uSo-dSo
Let plug in the formula
Hedge ratio=0.15/165-135
=-15/30
=-0.5or -1/2
The portfolio comprised of one share and as well as a two puts which provides a guaranteed payoff of $165
Let find the present value:
-0.5S-P= -0.5*165=-82.5
-0.5*150-P=-82.5/1.05= -78.57
P=78.38-75
P=3.38
Therefore how much that it would cost to purchase if the desired put option were traded will be$3.38
b. Calculation for what would be the cost of the protective put portfolio
The Cost of protective put portfolio with a $150 guaranteed payoff will be
$150 + $3.38 = $153.38
Therefore what would be the cost of the protective put portfolio will be $153.38
A customer holds 100 shares of ABC Corp $100 par convertible preferred stock convertible at a 10 to 1 ratio. If ABC declares and pays a 10% stock dividend, then as of the payable date, the customer will now have:_______.A. 90 shares of ABC preferred stockB. 100 shares of ABC preferred stockC. 100 shares of ABC preferred stock and 10 shares of ABC common stockD. 110 shares of ABC preferred stock
Answer:
B. 100 shares of ABC preferred stock
Explanation:
Shares are ownership stakes of a company that are given out to individuals who contribute to capital base of a company.
Preference shares are those whose owners recieve preference in payment of dividends, a fixed dividend is paid to them.
Ordinary shares recieve less preference when dividend is paid, usually coming last in divedend payment.
In this scenario ABC has decided to pay 10% stock dividend. This will be paid to ordinary share holders.
So the person with 100 preference shares will have 100 preference shares
10% of par value of $100 is 0.1 * 100= $10
Number of shares are 100 so the value is now 100 * $10 = $1,000
Since the conversion rate of preference to ordinary shares is 10:1
Number of preference shares= 1,000 ÷ 10= 100 preference shares
Answer:
is C
Explanation:
CADB