Answer:
A. 1.375
B. 0.648
C. 77.87 days
D. 1.5 times
E. 4.69 times
F. 3.35 times
G. 34 %
H. 4.63 %
I. 23.22%
Explanation:
A. What is the firm's current ratio
current ratio = current assets / current liabilities
= $23,595 / $17,160
= 1.375
B. What is the firm's quick ratio
quick ratio = (current assets - inventory) / current liabilities
= ($23,595 - $12,480) / $17,160
= 0.648
C. What is the firm's days sales outstanding Assume a 365-day year for this calculation.
days sales outstanding = Inventory / (Sales / 365)
= $12,480 / ($58,500 /365)
= 77.87 days
D. What is the firm's total assets turnover
total assets turnover = Sales / Total Assets
= $58,500 / $39,000
= 1.5 times
E. What is the firm's inventory turnover ratio?
inventory turnover ratio = Sales / Inventory
= $58,500 / $12,480
= 4.69 times
F. What is the firm's TIE?
Total Interest Expense (TIE) = Earnings before interest and taxes (EBIT) / Total Interest Expense
= $2,779 / $829
= 3.35 times
G. What is the firm's debt/assets ratio?
debt/assets ratio = Total Debt / Total Assets × 100
= ($5,460 + $ $7,800) / $39,000 × 100
= 34 %
H. What is the firm's ROA?
Return on Assets (ROA) = Earnings Before Interest After Tax (EBIAT) / Total Assets × 100
= ($1,268 + ($829 × 65%)) / $39,000 × 100
= 4.63 %
I. What is the firm's ROE?
Return on Equity (ROE) = Net Income / Total Shareholders Funds
= $1,268 / $5,460 × 100
= 23.22%
The debate on the effects of raising the minimum wage is ongoing. A few years ago, Seattle, Los Angeles, and San Francisco passed laws to gradually raise the minimum wage to $15/hour. Beaudry, Paul, David A. Green, and Ben M. Sand (investigated the possible effects of these laws on the labor market and concluded that "...for workers below $10 per hour in Seattle, the employment rate declines by over 10 percent in response to raising the minimum wage to $15. Meanwhile, for the larger group with wages at or below $15, the decline is approximately 7 percent." The authors' conclusion is consistent with the specific economic theory discussed in the course that
Answer:
The findings are consistent with the specific economic theory about minimum wage that is held by mainstream, neoclassical theories.
According to this theory, a minimum wage is essentially a binding price floor: a minimum price (in this case, the price of labor, which is the wage) set by the government that is above the market rate.
what happens when imposing this binding price floor is that the supply of labor (workers) becomes higher than the demand (the firms that hire the workers), leading to oversupply. In other words, some workers are left unemployed because there is no demand for them at the price set by the government.
The findings are consistent with this economic theory.
In contrasting equity and efficiency, why do high-tech firms seem to treat their employees better (better wages, benefits, working environments, vacations, etc.) compared to how landscaping or fast-food franchises treat their employees
Answer:
High-tech firms are hiring expensive, sophisticated people who are in high demand compared to fast food franchises and treat them better to avoid losing them to other companies
Explanation:
High-tech firms are hiring expensive, sophisticated people who are in high demand. This brings about a better treatment of their employees because if they do not offer these amenities to employees, they would become employees of other high-tech companies. Individuals with low skill levels do not get high salaries or benefits. They are not in as high demand as highly skilled workers. It is efficient, but many would argue that it is not fair.
A company's production department was experiencing a high defect rate on the assembly line, which was slowing down production and causing wastage of valuable direct materials. The production manager decided to purchase a higher grade of materials that would be more reliable, but he was worried that the cost of the new materials might negatively affect operating income. This would produce a(n) ________.A. unfavorable direct materials cost variance
B. unfavorable direct materials efficiency variance
C. favorable direct labor cost variance
D. favorable direct labor efficiency variance
Answer:
D
Explanation:
Because the higher the quality of materials the more efficient the product will be
Leslie McCormack is in the spring quarter of her freshman year of college. She and her friends already are planning a trip to Europe after graduation in a little over three years. Leslie would like to contribute to a savings account over the next three years in order to accumulate enough money to take the trip. Assume an interest rate of 12%, compounded quarterly. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) How much will she accumulate in three years by depositing $460 at the end of each of the next 12 quarters, beginning three months from now
Answer:
$6,528.33
Explanation:
The amount she would accumulate can be determined using the future value formula in excel which is given thus:
=fv(rate,nper,-pmt,pv))
the rate applicable is the interest rate per quarter which is the annual rate of interest of 12% divided by 4 quarters in a year i.e 3%
nper is 12 quarters
pmt is the amount deposited per quarter which is $460
pv is the present of all deposits made in 12 quarters which is unknown
=fv(3%,12,-460,0)=$ 6,528.33
You want to invite one of the authors of your textbook to come to your school and speak. Name two persuasive points you would include in your letter in order to persuade them to say “yes.”
A company had net income of $216,841. Depreciation expense was $28,774. During the year, accounts receivable and inventory increased by $14,088 and $27,397, respectively. Prepaid expenses and accounts payable decreased by $1,485 and $4,297, respectively. There was also a loss on the sale of equipment of $6,914. How much was the net cash flow from operating activities on the statement of cash flows using the indirect method
Answer:
$208,232.00
Explanation:
The net cash provided by operating activities is the net income for the year plus depreciation expense, minus the increase in accounts receivable, inventory and the decrease the accounts payable , plus the decrease in prepaid expenses as well as the loss on disposal of equipment.
Net cash provided by operating activities=$216,841+$28,774-$14,088-$27,397+$1,485-$4,297+$6,914
=$ 208,232.00
The amount of cash provided by operating activities is $208,232.00
Consider a market characterized by a Herfindahl-Hirschman index of 5,000. One of the firms in this market has a Lerner index of 0.89 and is considering a horizontal merger with a competing firm. Based on this information, it is likely that the U.S. Department of Justice will:
Answer:
reject the merger
Explanation:
Seeing since the market is highly concentrated and the firm's lerner index is also very high, meaning they have a large measure of market power in that industry then it is safe to assume that the U.S. Department of Justice will most likely reject the merger due to this high concentration and the significant power that the proposing firm already has in the market.
Initially, you produce 100 boxes of jelly beans per time period. Then a new customer calls and places an additional order for jelly beans, requiring you to increase your output to 101 boxes. She offers you $1.75 for the additional box. Should you produce it?
Answer:
You should produce as long as the marginal cost per additional box is lower than the marginal revenue obtained by the additional box.
In other words, if the marginal cost of producing the 101th box is lower than $1.75, then, you should continue to produce, because revenue will be higher than cost, and a profit will be made as a result.
Exercise 14-5 (Algo) Bonds; issuance; effective interest; financial statement effects [LO14-2] Myriad Solutions, Inc. issued 12% bonds, dated January 1, with a face amount of $390 million on January 1, 2021, for $348,683,634. The bonds mature on December 31, 2030 (10 years). For bonds of similar risk and maturity the market yield is 14%. Interest is paid semiannually on June 30 and December 31. Required: Calculate the amounts related to the bonds that Myriad would report in its financial statements. (Round your answers to the nearest whole dollar.)
Answer:
1a.Carrying value $354,266,807
Interest expense $52,383,173
Cash Interest $46,800,000
1b.Balance Sheet:
Net Liability $354,266,807
Income Statement:
Interest expense $52,383,173
Statement of cash flows:
Operating -$46,800,000
Investing 0
Financing $348,683,634
Explanation:
1a.Calculation of the amounts related to the bonds that Myriad would report in its financial statements
Bond Amortization Schedule
Date Cash interest Interest Expense Discount amortization Carrying value
01-Jan-21 $348,683,634
30-Jun-21
$23,400,000 $24,407,854 $1,007,854 $349,691,488
31-Dec-21 $23,400,000 $27,975,319 $4,575,319 $354,266,807
Total amount of Cash Interest
$46,800,000
Total amount of Interest expense $52,383,173
1b. Indication of the amounts to be reported on the financial statements for the year ending December 31, 2021
Myriad Financial statements
Balance Sheet:
Net Liability $354,266,807
Income Statement:
Interest expense $52,383,173
Statement of cash flows:
Operating -$46,800,000
Investing 0
Financing $348,683,634
($354,266,807+$46,800,000)
=$401,066,807
$401,066,807-$52,383,173
=$348,683,634
On January 1, 2017, Best Shipping Transportation Company purchased a used aircraft at a cost of $ 48 comma 700 comma 000. Best Shipping expects the plane to remain useful for five years (7 comma 300 comma 000 miles) and to have a residual value of $ 4 comma 700 comma 000. Best Shipping expects to fly the plane 925 comma 000 miles the first year, 1 comma 200 comma 000 miles each year during the second, third, and fourth years, and 2 comma 775 comma 000 miles the last year. Requirements Compute Best Shipping's depreciation for the first two years on the plane a. Straight-line method Using the straight-line method, depreciation is $ for 2017 and $ for 2018. b. Units-of-production method (Round the depreciation per unit of output to two decimal places to compute your final answers.) Using the units-of-production method, depreciation is $ for 2017 and $ for 2018. c. Double-declining balance method Using the double-declining-balance method, depreciation is $ for 2017 and $ for 2018.
Answer and Explanation:
The computation of the depreciation expense for the first year and the second year is shown below:
a) Straight-line method:
= (Original cost - residual value) ÷ (useful life)
= ($48,700,000 - $4,700,000) ÷ (5 years)
= ($44,000,000) ÷ (5 years)
= $8,800,000
In this method, the depreciation is the same for all the remaining useful life
So for the 2017 and 2018 the depreciation of $8,800,000 is separately charged
(b) Units-of-production method:
= (Original cost - residual value) ÷ (estimated production)
= ($48,700,000 - $4,700,000) ÷ ($7,300,000 miles)
= ($44,000,000) ÷ ($7,300,000 miles)
= $6.02 per miles
Now for the 2017, it would be
= Miles in first year × depreciation per miles
= 925,000 miles × $6.02
= $5,568,500
And for the 2018, it is
= Miles in second year × depreciation per miles
= 1,200,000 miles × $6.02
= $7,224,000
(b) Double-declining balance method:
First we have to find the depreciation rate which is shown below:
= One ÷ useful life
= 1 ÷ 5
= 20%
Now the rate is double So, 40%
In year 2017, the original cost is $48,700,000, so the depreciation is $19,480,000 after applying the 40% depreciation rate
And, in year 2018, the ($48,700,000 - $19,480,000) × 40% = $11,688,000
For a recent year, McDonald's Company-owned restaurants had the following sales and expenses (in millions): Sales $25,700 Food and packaging $8,982 Payroll 6,500 Occupancy (rent, depreciation, etc.) 5,748 General, selling, and administrative expenses 3,700 $24,930 Income from operations $770 Assume that the variable costs consist of food and packaging, payroll, and 40% of the general, selling, and administrative expenses. a. What is McDonald's contribution margin
Answer:
a. $9,338
b. 0.363
Explanation:
a. Contribution Margin = Sales - Variable Cost
Where Sales = $25,700
Variable Cost = Food & Packaging + Payroll + 40% x General, Selling and Administrative expenses
V.C. = 8,982 + 6,500 + 40% * 3,700
V.C = 8,982 + 6,500 + 1,480
= $16,362
Therefore, Contribution Margin = Sales - Variable Cost
= $25,700 - $16,362
=$9,338
b. McDonald's contribution margin ratio = Contribution Margin / Sales
= $9,338 / $25,700
= 0.363
Magnolia, Inc. has budgeted sales for the first quarter of the next year to be 45,000 units. The inventory on hand at the beginning of quarter is 5,000 units. The desired ending inventory is 3,000 units. Calculate the budgeted production for the first quarter.
Answer:
Production= 43,000 units
Explanation:
Giving the following information:
Sales= 45,000 units
Beginning inventory= 5,000 units
The desired ending inventory is 3,000 units.
To calculate the budgeted production, we need to use the following formula:
Production= sales + desired ending inventory - beginning inventory
Production= 45,000 + 3,000 - 5,000
Production= 43,000 units
Present and future value
PV of $1 FV of $1 PVA of $1 FVAD of $1 FVA of $1
1 0.91743 1.09000 0.91743 1.0900 1.0000
2 0.84168 1.18810 1.75911 2.2781 2.0900
3 0.77218 1.29503 2.53129 3.5731 3.2781
4 0.70843 1.41158 3.23972 4.9847 4.5731
5 0.64993 1.53862 3.88965 6.5233 5.9847
6 0.59627 1.67710 4.48592 8.2004 7.5233
How much must be invested now at 9% interest to accumulate to $24,000 in four years?
a) $1,753.b) $1,965.c) $2,652.d) $2,317.
Answer:
$ 17,002.21 (none of the options is correct)
Explanation:
The formula for determining the present value ,which is the actual amount invested to give a future value is given below:
PV=FV*(1+r)^-n
The PV is the present value which is unknown
FV is the future worth of the investment which is $24,000
r is the rate of return which is 9% per year
n is the duration of investment which is 4 years
PV=$24,000*(1+9%)^-4
PV=$24,000*(1.09)^-4
PV=$24,000*0.708425211 =$ 17,002.21
Rhys Hoskins is the president of RH Corporation (RHC). RHC has provided the following partial listing of costs incurred during August: Marketing salaries $ 45,300 Utilities, factory $ 11,400 Administrative travel $ 102,300 Sales commissions $ 54,800 Indirect materials $ 39,500 Direct materials $ 166,400 Advertising $ 147,800 Depreciation of production equipment $ 47,000 Direct labor $ 91,700 Required: a. What is the total amount of manufacturing cost listed above?
Answer:
$306,000
Explanation:
To determine manufacturing costs, consider only those cost that can be directly traced to the product manufactured and plant related costs.
Total Manufacturing Cost Calculation :
Factory Utilities $11,400
Indirect Materials $39,500
Direct Materials $166,400
Equipment Depreciation $47,000
Direct labor $91,700
Total Manufacturing Cost $306,000
he following information was drawn from the accounting records of Chapin Company. On January 1, Year 1, Chapin paid $56,000 cash to purchase a truck. The truck had a five-year useful life and a $6,000 salvage value. As of December 31, Year 1, Chapin Company had a $68,000 balance in its Accounts Receivable account and a zero balance in its Allowance for Doubtful Accounts account. Sales on account for Year 1 amounted to $320,000. Chapin estimates that 5 percent of credit sales will be uncollectible. Required a. Record the year-end adjusting entry for depreciation expense on the truck in T-accounts. b. Determine the book value of the truck that will appear on the December 31, Year 1, balance sheet. c. Record the year-end adjusting entry of uncollectible accounts expense. d. Determine the net realizable value of receivables that will appear on the December 31, Year 1, balance sheet.
Answer:
a. Record the year-end adjusting entry for depreciation expense on the truck in T-accounts.
December 31, 202x, accrued depreciation expense on truck
Dr Depreciation expense 10,000
Cr Accumulated depreciation - truck 10,000
b. Determine the book value of the truck that will appear on the December 31, Year 1, balance sheet.
Truck $46,000
c. Record the year-end adjusting entry of uncollectible accounts expense.
December 31, 202x, allowance for doubtful accounts
Dr Bad debt expense 16,000
Cr Allowance for doubtful accounts 16,000
d. Determine the net realizable value of receivables that will appear on the December 31, Year 1, balance sheet.
Accounts receivable $52,000
Explanation:
truck's depreciation expense straight depreciation = ($56,000 - $6,000) / 5 years = $10,000 per year
accounts receivable balance December 31 = $68,000
allowance for doubtful accounts = $0
total sales on account = $320,000
5% of credit sales are uncollectible
accounts receivable = $68,000 - $16,000 = $52,000
2. Jill would like to plan for her son’s college education. She would like for her son, who was born today, to attend college for 5 years, beginning at age 18. Tuition is currently $12,000 per year and tuition inflation is 6%. Jill can earn an after-tax rate of return of 8%. How much must Jill save at the end of each year, if she wants to make the last payment at the beginning of her son’s first year of college?
Answer:
$4,531.50
Explanation:
first we must determine the cost of tuition in 18 years (2038):
$12,000 x (1 + 6%)¹⁸ = $34,252 per year
to calculate the total value of college tuition (5 years) in 2038 we can use the annuity due factor (6% and 5 years) 4.4651:
total college tuition = $34,252 x 4.4651 = $152,939
this means that Jill needs to have $152,939 for the moment her son starts college:
we have to calculate the payment:
to calculate the future value of an annuity (since she starts to save at end of the year, it is an ordinary annuity, not annuity due) we use the following formula:
future value = payment x ordinary annuity factor (8% and 17 years)
we know future value ($152,939) and the annuity factor = 33.7502
payment = future value / annuity factor
payment = $152,939 / 33.7502 = $4,531.50
Riverbed Corporation was organized on January 1, 2020. It is authorized to issue 14,500 shares of 8%, $100 par value preferred stock, and 475,000 shares of no-par common stock with a stated value of $2 per share. The following stock transactions were completed during the first year.
Jan. 10 Issued 84,500 shares of common stock for cash at $4 per share.
Mar. 1 Issued 4,050 shares of preferred stock for cash at $110 per share.
Apr. 1 Issued 24,000 shares of common stock for land. The asking price of the land was $88,500. The fair value of the land was $83,500.
May 1 Issued 83,000 shares of common stock for cash at $5.25 per share.
Aug. 1 Issued 12,000 shares of common stock to attorneys in payment of their bill of $40,500 for services performed in helping the company organize.
Sept. 1 Issued 11,500 shares of common stock for cash at $5 per share.
Nov. 1 Issued 2,500 shares of preferred stock for cash at $111 per share
Required:
Journalize the transactions.
Answer:
Jan. 10
Cash $338,000 (debit)
Common Stock $338,000 (credit)
Mar. 1
Cash $445,500 (debit)
Common Stock $445,500 (credit)
Apr. 1
Land $88,500 (debit)
Common Stock $88,500 (credit)
May 1
Cash $435,750 (debit)
Common Stock $435,750 (credit)
Aug 1
Organizing Costs : attorneys $40,500 (debit)
Common Stock $40,500 (credit)
Sept. 1
Cash $57,500 (debit)
Common Stock $57,500 (credit)
Nov. 1
Cash (debit) $277,500
Share Premium ; Preference Stock (credit) $27,500
Preference Stock (credit) $250,000
Explanation:
The Common Stocks are classified as no-par common stock. This means there is no premium account recognized for this classification of stock. The stocks will be presented at their respective value at date of issuance.
With the Preference Stock, this is different. A par value of $100 has been established. Any payment made in excess of the par value will end up in Share Premium Account.
Sheffield Corp. has 285,000 shares of $8 par value common stock outstanding. It declares a 13% stock dividend on December 1 when the market price per share is $16. The dividend shares are issued on December 31. Prepare the entries for the declaration and distribution of the stock dividend. (Record journal entries in the order presented in the problem. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Answer:
285,000 common stock outstanding with a $8 par value
it declares 13% stock dividend
market price at $16
since the stock dividend is considered small (less than 20%), we use the market price to record it
December 1, 202x stock dividends are declared (37,050 stocks)
Dr Retained earnings 592,800
Cr Common stock dividends distributable 296,400
Cr Additional paid in capital 296,400
December 31, 202x, distribution of stock dividends
Dr Common stock dividends distributable 296,400
Cr Common stock 296,400
A C corporation earns $ 9.20 per share before taxes and the company pays a dividend of $ 4.00 per share. The corporate tax rate is 39%, the personal tax rate on dividends is 15%, and the personal tax rate on non-dividend income is 36%. What is the after-tax amount an individual would receive from the dividend?
Answer:
The answer is $4.27
Explanation:
Solution
Given that:
AC corporation earns = $9.2 per share
Pays a dividend of =$4.00
The tax rate (Corporate ) is =39%
The tax rate on personal dividends is= 15%
The tax rate for non-dividend personal income is = 36%
Now,
We must find the after tax rate amount of after tax rate an individual or a person would earn from the dividend
Thus,
The corporate tax =$9.40 * 39% = 3.67
Personal tax = $4.00 * 15% = 0.6
Now we find the total for the after tax rate
Total = $3.67 + $0.6
= $4.27
Therefore, the after tax rate an individual or a person would earn from the said divided is $4.27
Using the following end-of-year information, calculate the number of days' sales in receivables for Year 2.
Year 2: Sales are $82,500; average accounts receivable is $11,000.
Year 1: Sales are $78,000; average accounts receivable is $10,000.
a. 7.8
b. 7.5
c. 46.8
d. 48.7
Answer:
The number of days' sales in receivables for Year 2 is 48.7
Explanation:
The formula that is applicable to this scenario is the accounts receivable divided by sales multiplied by 365 days
The number of days' sales in receivables=$11,000/$82,500*365=48.67
The correct option is D, since the 48.67 was simply rounded down to one decimal place.
4.
What does it mean when a solid white line separates a narrow bike lane
from the right-most lane of traffic?
A. Motor vehicles may not use the bike lane except to make a turn.
B. Motor vehicles may not use the bike lane except to park.
C. Motor vehicles may not use the bike lane for any reason.
D. Bicyclists may not turn left for any reason, except in an emergency,
Answer:
A single or double solid white line dividing traffic lanes going in the same direction can't be crossed for any reason. A single solid white line is generally used to indicate the right- most boundary of the drivable roadway on highways.
Explanation:
hope this helps you :)
Answer:
Hi! your answer should be A. Motor vehicles may not use the bike lane except to make a turn.
Explanation:
it wouldn't be B because you cannot park in the bike lane.
it wouldn't be C because you're allowed to use it when turning.
it wouldn't be D because that doesn't make much sense.
hope this helps!
A new American graduate is contemplating buying a
Japanese, German, or an American car. No matter the type of car, he
plans to buy a new one at the end of 8 years.
The Japanese cars will cost $30,000 and have a fuel
usage of 23 Miles Per gallon (mpg) for the first 2 years and will
decrease by 3% per year thereafter. The repair cost will start at $700
per year, and increase by 3% per year. At the end of year 8, the
car can be sold for $5000. Insurance cost will be $700 for the
first year, increasing by 2% per year thereafter.
A German car will cost $45,000 and have fuel usage
of 21mpg for the first 5 years, and decrease by 1% thereafter to
year 8. The repair cost will start at $1000 in year 1 and increase by
4% per year. It will have a salvage value of $7000 at the end of
year 8. Insurance cost will be $850 the first year, increasing by
2% per year thereafter.
The American car will cost $35,000 and have fuel
usage of 20mpg for the first 3 years and will decrease by 3% per
year thereafter. The repair cost will be $800 in year 1, increasing by
4% per year thereafter. Being an American, the graduate will price
the pride of owning an American car at $0.4 for every 20 miles
driven, increasing by 2% per year. Insurance costs will be $800 per
year increasing by 2.2% per year. The car can be sold for $5500 at
the end of year 8.
If the graduate anticipates driving 150000 miles by
the end of year 8 and the average interest rate is expected to
remain at 5% per year, which car is economically affordable based
on present worth analysis? Assume fuel cost will be $3 per gallon
in year 1 and increase by an average of 2% per year. Show all your
workings.
Answer:
The best option is to buy Japanese Car.
Explanation:
Fuel usage per year is 150000/ 8 = 18750 miles per year
Fuel cost (year 1 -8) = $3.0, $3.06, $3.12, $3.18, $3.25, $3.312, $3.38, $3.5
Japanese Car:
Fuel usage 18750 / 23 = 815 * $3 = $2446
Fuel charges (year 1 -8) = $2445, $2494, $2623, $2758. $2900, $3050, $3207, $3372
Repair Cost (year 1 - 8) = $700, $721, $742, $764, $787, $811, $835, $860
Insurance cost (Year 1 - 8) = $700, $714, $728, $742, $757, $772, $788, $804
Present value of cost at 5% = 24674.07
Cost of car is $30,000
Total cost = $54674.07
American Car:
Cost $35,000
Fuel usage 18750/20 = 937.5 * $3 per gallon = $2812.5.
Fuel charges (year 1 -8) = $2812, $2913, $2986, $3011. $3098, $3124, $3176, $3208
Repair Cost (year 1 - 8) = $800, $894, $921, $978, $1109, $1176, $1207, $1301
Insurance cost (Year 1 - 8) = $800, $827, $876, $898, $908, $932, $954, $934
Present value of cost at 5% = 25302.18
Cost of car is $35,000
Total cost = $60302.
German Car:
Cost = $45,000
Fuel usage 18750 / 21 = 892 * $3 = $2678
Fuel charges (year 1 -8) = $2679, $2732, $2786, $2842. $2899, $2987, $3077, $3171
Repair Cost (year 1 - 8) = $1000, $1040, $1081, $1124, $1169, $1216, $1265, $1316
Insurance cost (Year 1 - 8) = $850, $867, $884, $902, $920, $938, $957, $976
Present value of cost at 5% = 27105.73
Cost of car is $45,000
Total cost = $72105.
Sunshine Foods manufactures pumpkin scones. For January 2017, it budgeted to purchase and use 14,750 pounds of pumpkin at $0.92 a pound. Actual purchases and usage for January 2017 were 16,000 pounds at $0.85 a pound. Sunshine budgeted for 59,000 pumpkin scones. Actual output was 59,200 pumpkin scones.1. Compute the flexible-budget variance.2. Compute the price and efficiency variances.3. Comment on the results for requirements 1 and 2 and provide a possible explanation for them
Answer:
The explanation of the given scenario is described in the explanation section below.
Explanation:
The given values are:
Selling Price, SP = $0.92
AP = $0.85
(1)...
To compute the flexible budget variance,
= [tex]Actual \results - Standard \ results[/tex]
= [tex]( 16000\times 0.85 ) - (\frac{59200\times 14750}{59000\times 0.92} )[/tex]
= [tex]13600 - 13616[/tex]
= $[tex]16 \ (favorable)[/tex]
(2)...
To compute the price and efficiency variances,
[tex]Price \ variance = ( SP - AP )\times AQ \ purchased[/tex]
⇒ [tex]=( 0.92 - 0.85 )\times 16000[/tex]
⇒ [tex]=1120 \ (favorable)[/tex]
Now,
Efficiency variance = (SQ for actual output - AQ ) × SP
⇒ = [tex]( [\frac{59200\times 14750 }{59000} ] - 16000 )\times 0.92[/tex]
⇒ = [tex]1104 \ (favorable)[/tex]
(3)...
The Price variance is the difference that further tends to mean that the material was bought at such a cheaper rate than assumed, but the efficiency variance does seem to be unfavorable, which tends to mean that the content has been used more than anticipated. Yet another possible explanation for that kind of variance could be lower prices contribute to better customer satisfaction,
However, the overall variance seems to be $16 favorable, and therefore final figures could be said to satisfy the requirements.
On January 1, Wei company begins the accounting period with a $42,000 credit balance in Allowance for Doubtful Accounts.
A. On February 1, the company determined that $9,200 in customer accounts was uncollectible; specifically, $2,100 for Oakley Co. and $7,100 for Brookes Co. Prepare the journal entry to write off those two accounts.
B. On June 5, the company unexpectedly received a $2,100 payment on a customer account, Oakley Company, that had previously been written off in part a. Prepare the entries to reinstate the account and record the cash received.
Answer:
Wei company General Journal
Feb 01
Dr Allowance for doubtful accounts $9,200
Cr Accounts receivable—Oakley Co. $2,100
Cr Accounts receivable—Brookes Co. $7,100
June 05
Dr Accounts receivable—Oakley Co. $2,100
Cr Allowance for doubtful accounts $2,100
June 05
Dr Cash $2,100
Cr Accounts receivable—Oakley Co. $2,100
Explanation:
Feb 01
(To record write off accounts receivables)
June 05
(To record reinstatement accounts receivable)
June 05
(To record receipt from accounts receivable)
As a student in the Principles of Management class of Ama Ghana University, you are expected to have experiential knowledge so that you can be able to solve real life business problems after graduation. To achieve this objective, the 2020 class has been divided into ten groups; and each team works in a management capacity with ten management consulting companies in the Greater Accra Region. San Consulting - the firm that your group works with is a project management company that is into Real Estate construction and management consulting. This firm which has twenty years’ experience in this business is the first choice for all individuals and companies that want quality service. You have on the contrary, observed that many of the management practices have not developed precipitously as situations in the business environment warrant. The accountant confirmed this by saying in the last general meeting that a certain percentage of San’s profit margin is being lost because of this situation. She gave the example that the surveying department spent eight labor hours generating data that had been generated two weeks ago by another unit. Due to the fact that the surveying department did not know that the data had already been created, a substantial effort was wasted and this has been a recurrent problem. In addition, the increase in demand of the services of San’s Consulting has placed significant pressures on the five managers whose duties are not clearly defined. For instance, you have observed that any of these managers perform duties in the operations department as well as any other unit within the firm. They are not able to perform all the functions required of them due to the ineffectiveness of the organizational structure. You and the members of your group are expected to write a report to the top-level management team regarding your analysis of the situation in the firm.
Answer:
Top level management is the most senior executives of the company. To write a report to them about the organizational structure, we mention the summary of the situation and then ask them for their measures.
Explanation:
Ineffectiveness of Organizational Structure
Summary:
The organization structure is not clearly defined, Managers are performing duties in various departments at a time.
Details:
San Consulting is one of the finest consulting firm in the Greater Accra Region. The firm is always a first choice for individuals who want to pursue their career in business. The Organizational structure of San Consulting is not clearly defined. San's profits are falling because management practices are not according to the other competitive organizations. The managers working at San are facing excess workload and pressure for their work. Their job description is not clearly defined and they are forced to work in multiple departments at the same time due to which they are losing focus on their own work.
Conclusion:
The organizational structure needs to be set and every employee should have their defined job role so they are able to complete work with efficiency.
Consider the market for meekers in the imaginary economy of Meekertown. In the absence of international trade, the domestic price of a meeker is $30. Suppose that the world price for a meeker is $40. Assume that Meekertown is too small to influence the world price for meekers once they enter the international market.
If Meekertown allows free trade, then it will (import/export?) meekers.
Given current economic conditions in Meekertown, complete the following table by indicating whether each of the statements is true or false.
Statement True False
Meekertownian consumers are worse off under free trade than they were before.
Meekertownian producers were better off without free trade than they are with it.
True or False: When a country is too small to affect the world price, allowing for free trade will always increase total surplus in that country, regardless of whether it imports or exports as a result of international trade.
Answer:
Export
True
False
True
Explanation:
Free trade is a form of trade policy where there are no restrictions to imports or exports of goods and services.
The price of meekers is $30 in Meekertown and $40 In the world. Because meeker's are cheaper in Meekertown, it means that Meekertown is efficient in the production of meekers. As a result, they would export meekers to the rest of the world. It would be cost efficient for the rest of the world to import from Meekertown.
Consumers in Meekertown are worse of because of the trade because the price of Meekers would rise.
Producers are better off because they would earn more profits from the sale of Meekers at the world price.
Free trade increases total surplus because of efficient production. If a country is inefficient in production, it would import . This would increase consumer surplus and if it is efficient in production, it would export increasing producer surplus.
I hope my answer helps you
An investment adviser that manages a portfolio for a client has not taken custody. The customer informs the adviser that he will be traveling overseas for 1 year on a round-the-world cruise and gives the adviser authority to write checks on his personal bank account to pay the quarterly custodian bank fees. Under the provisions of the Investment Advisers Act of 1940, the adviser:
Answer: C. has taken custody of customer funds and must comply with the additional requirements of the custody rule
Explanation:
The options for the question are:
A. can follow the customer's instructions without additional action taken, since this is a service to the customer
B. has not taken custody of client funds, unless the custodian bank and the investment adviser are under common ownership
C. has taken custody of customer funds and must comply with the additional requirements of the custody rule
D. has a conflict of interest that must be disclosed in writing to the customer
The Investment Advisers Act is a law which was enacted in order to regulate the investment advisers. It requires that firms that receive compensation when they advise others about their securities investments will have to register with Securities Exchange Commission and also abide with the regulations which are in place to protect the investors.
In the Act, it was said that an investment adviser has had a custody of the client assets, and should therefore comply and abide with the rule since the adviser is in possession of the client funds. Therefore, option C is the correct answer.
Suppose the market for pizzas is unregulated. That is, pizza prices are free to adjust based on the forces of supply and demand.
If a shortage exists in the pizza market, then the current price must be.............than the equilibrium price. For the market to reach equilibrium, you would expect................
Answer:
Lower
Buyers would offer higher prices
Explanation:
When a shortage occurs when Demand exceeds supply. Excess demand occurs when price is below equilibrium price and as a result suppliers reduce quantity supplied.
As a result of the shortage, buyers would offer higher prices. As a result of the higher prices, the quantity supplied would increase and equilibrium would be restored.
I hope my answer helps you
When a GEM Manufacturing experienced a slowdown in sales, it laid off the two employees with the poorest attendance. One of the employees sued the company, saying it should have laid off the most recently hired workers. What defense should GRM Manufacturing most likely offer
Answer:
the layoffs were instances of employment at will
Explanation:
GEM Manufacturing's defense would most likely be that the layoffs were instances of employment at will.
Employment at will is a situation where a worker may be dismissed by an employer for any reason that may not be illegal and at anytime.
The Employers, in this question for example, terminated the relationship because of slowdown in sales. And this action affected the two employees with poorest attendance.
3. How have you contributed to solving a challenge and to implementing change or reform?*(Be specific and include: what aspect/s of your leadership knowledge, skills and practice you consider to bewell established and effective; which people or organisations you worked with to solve the problem, and whatcreative methods were used.)