Answer:
$8,369.38
Explanation:
The amount that must be placed in the account can be viewed as a yearly instalment usually represented by PMT. The PMT is calculated as :
PV = $0
FV = $40,000
N = 4
P/yr = 1
I/yr = 12%
PMT = ??
Using a Financial calculator, PMT is $8,369.38
thus,
The amount that must be placed in the account at the end of each year is $8,369.38.
Scott is a 50% partner in the LS Partnership. Scott has a basis in his partnership interest of $84,000 at the end of the current year, prior to any distribution. On December 31, Scott receives an operating distribution of $9,000 cash and a parcel of land with a $21,000 fair market value and a $12,000 basis to the partnership. LS has no debt or hot assets. What is the amount and character of Scott's recognized gain or loss
Answer:
A. No gain or loss
B. Cash $9,000
Land $12,000
C. $63,000
Explanation:
A. Based on the information given he RECOGNIZES NO GAIN OR LOSS
B. Based on the information given his basis in the distributed property will be basis of $9,000 cash and basis of $12,000 land
C. Calculation to determine his ending basis in his partnership interest
Ending basis=$84,000 - $9,000 - $12,000
Ending basis =$63,000
Therefore his ending basis in his partnership interest will be $63,000
Atlas Corporation reported the following earnings per share information in its current annual report. The company has only one class of stock outstanding. ($ in millions) Net income $7,121 Dividends to common shareholders $2,033 Weighted average common shares outstanding 4,221 Weighted average dilutive shares 4,305 Basic and diluted earnings per share were, respectively: Select one: a. $1.69 and $1.18 b. None of these are correct. c. $2.17 and $2.13 d. $1.69 and $1.65 e. $1.21 and $1.18
Answer:
d. $1.69 and $1.65
Explanation:
Basic EPS = Net income ÷ Common share outstanding
Where, Net income = $7,121
Common shares outstanding = 4,221
So, Basic EPS = $7,121 ÷ 4,221
= $1.69
Diluted EPS = Net income ÷ Weighted dilutive share
Where, Weighted dilutive share = 4,305
So, Diluted EPS = $7,121 ÷ 4,305
= $1.65
Hence, $1.69 and $1.65 is the correct answer.
The historical rate of return on stock A was regressed on the rate of return of stock M (the explanatory variable). The slope of the regression line was 0.8, the standard deviation of the residuals was 0.3 and the standard deviation of the rate of return of M was 0.2. What was the standard deviation of the rate of return on A
Answer:
0.3400
Explanation:
Total variance of security = (Standard deviation of security)^2 = (Beta)^2*(Standard deviation of security)^2 + (Standard deviation of error terms)^2
Total variance of security = (Standard deviation of security)^2 = (0.8)^2*(0.2)^2 + (0.3)^2
Total variance of security = (Standard deviation of security)^2 = 0.1156
Standard deviation of the rate of return on A = √0.1156
Standard deviation of the rate of return on A = 0.3400
Marko, Inc., is considering the purchase of ABC Co. Marko believes that ABC Co. can generate cash flows of $5,600, $10,600, and $16,800 over the next three years, respectively. After that time, they feel the business will be worthless. Marko has determined that a rate of return of 10 percent is applicable to this potential purchase. What is Marko willing to pay today to buy ABC Co.
Answer:
$26,473.33
Explanation:
The amount Marko would be willing to pay today can be determined by calculating the present value of the cash flows
Present value is the sum of discounted cash flows
Present value can be calculated using a financial calculator
Cash flow in year 1 = $5,600
Cash flow in year 2 = $10,600
Cash flow in year 3 = $16,800
I = 10%
PV = $26,473.33
To find the PV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
Which of the following business actions would likely result in criminal
prosecution?
O A. A utility company cannot remain profitable and goes into
bankruptcy.
B. A waste removal company dumps garbage in a protected federal
forest
c. A lumber yard stops buying products from a long-term supplier.
D. A computer software company refuses to honor coupons it
mistakenly printed.
SUBMITI
PREVIOUS
Answer:
B. A waste removal company dumps garbage in a protected federal forest.
Explanation:
Businesses face prosecution when they indulge in actions which are illegal and unwarranted.
An utility company which goes into bankruptcy due it's inability to generate profit hasn't in any way wronged the government and will not be punished for going bankrupt.
Similarly, choosing one's supplier is by choice as long as one does not owe the supplier, changing one's supplier is a common business process due to numerous reasons and hence attracts no sanction.
Also, failure to honor accidentally printed coupons cannot be deemed a criminal offense, the company isn't defrauding their clients here, breach in firewall and testing, software glitches are common causes of such mistake. Hence, failure to honor such isn't a criminal act.
However, trespassing and violation of guidelines and regulatory laws will be deemed as criminal and approve sanctions. Ware removal companies have approved means and areas for disposing and getting rid of waste, Waste disposal in unapproved and reserved areas Wil attract sanctions.
Answer:
B. A waste removal company dumps garbage in a protected federal forest.
Explanation:
Businesses face prosecution when they indulge in actions which are illegal and unwarranted.
An utility company which goes into bankruptcy due it's inability to generate profit hasn't in any way wronged the government and will not be punished for going bankrupt.
Similarly, choosing one's supplier is by choice as long as one does not owe the supplier, changing one's supplier is a common business process due to numerous reasons and hence attracts no sanction.
Also, failure to honor accidentally printed coupons cannot be deemed a criminal offense, the company isn't defrauding their clients here, breach in firewall and testing, software glitches are common causes of such mistake. Hence, failure to honor such isn't a criminal act.
However, trespassing and violation of guidelines and regulatory laws will be deemed as criminal and approve sanctions. Ware removal companies have approved means and areas for disposing and getting rid of waste, Waste disposal in unapproved and reserved areas Wil attract sanctions.
Wireless Solutions reports operating expenses of $955,000. Operating expenses include both rent expense and salaries expense. Prepaid rent increases during the year by $27,000 and salaries payable increases by $18,500. What is the cash paid for operating expenses during the year
Answer:
$963,500
Explanation:
Given the that:
Operating expenses = $955,000
Prepaid rent increase = $27,000
Salaries payable increase = $18,500
Then, Cash paid for operating expenses during the year is computed by;
= Operating expenses + Prepaid rent increase - Salaries payable increase
= $955,000 + $27,000 - $18,500
= $963,500
Blue Corporation purchased a truck at the beginning of 2020 for $61,000. The truck is estimated to have a salvage value of $2,440 and a useful life of 195,200 miles. It was driven 28,060 miles in 2020 and 37,820 miles in 2021. Compute depreciation expense using the units-of-production method for 2020 and 2021.
Depreciation expense for 2020
Depreciation expense for 2021
Answer:
Depreciation expense for 2020 = $8,418
Depreciation expense for 2021 = $11,346
Explanation:
Depreciation expense using the units-of-production method is determined as follows :
Depreciation expense = Depreciation rate x annual usage
where,
Depreciation rate = (Cost - Salvage Value) ÷ Estimated usage
= ($61,000 - $2,440) ÷ 195,200 miles
= $0.30 per mile
thus,
Depreciation expense for 2020
Depreciation expense = $0.30 per mile x 28,060 miles
= $8,418
Depreciation expense for 2021
Depreciation expense = $0.30 per mile x 37,820 miles
= $11,346
Which of the following is correct regarding the fiduciary duties in a limited partnership? A. The general partner has a fiduciary duty to the limited partners. B. Judicial authority seems to suggest that the limited partner has no fiduciary duty to the partnership. C. The fiduciary duty of the general partner is extremely important to the interests of the limited partners, because they have no ability to manage or control the partnership business. D. All of these are correct.
Answer:
B. Judicial authority seems to suggest that the limited partner has no fiduciary duty to the partnership.
Explanation:
A partnership occurs when two or more people come together to pool their resources in a business sharing the risk and rewards that come with the business venture.
Normally a partner is expected to have fuducairy duty to the other partners.
Other partners interest are placed above their own personal interest.
However a limited partner only provides resources to the business without being involved in the running and management of the business.
Since they are non managing partners they do not owe fiduciary duties to the other partners.
They only provide funds in order to get profit
Legos makes multiple lines of products, including Duplos (for toddlers), various Lego kits and games (for boys 7-12 years of age), Friends and Disney Princess Lego kits (for girls 7-12 years of age), Technics (automated kits for teenage boys), and Legos Architecture (for young adults and college students). For each of these product lines, Lego targets a specific segment of consumers and develops different promotional strategies to appeal to each segment. This illustrates:
Question Completion:
O an undifferentiated targeting strategy.
O a differentiated (multi-segment) targeting strategy.
O a concentrated targeting strategy.
O none of these.
O an non-concentrated targeting strategy.
Answer:
Legos
This illustrates:
O a differentiated (multi-segment) targeting strategy.
Explanation:
The company is using a differentiated, multi-segment targeting strategy. The multi-segments targeted are toddlers, boys 7-12 years of age, girls 7-12 years of age, teenage boys, and young adults and college students. With this differentiated multi-segment marketing, Legos targets each segment in a different way, providing unique benefits to the different market segments. The purpose is to maximize sales and profits by meeting the multivariate needs of the various segments.
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Answer:
sjhdkwnsksnaksndksnwkjssmnzkanzkdndns
1 My sister.....coming home this weekend. (is / are).
2 My sisters......coming home this weekend. (is / are).
3 I....going to Disneyland in March (am / are).
4 We....going to Disneyland in March. (am / are) .
5 He always.....his toys with me(share e/shares).
6 They always.....their toys with me.(share/ shares).
7 My class.....a lot of homework today. (has/have).
8 We.......a lot of homework today.(has/have).
9 You ......nice in that dress. (look looks).
10 She..... nice in that dress. (look looks).
Answer:
1. is
2. are
3. am
4. shares
5. share
6. has
7. has
8. have
9. look
10. looks
Explanation:
pay attention In class
To compare statement of cash flows reporting under the direct and indirect methods, indicate whether each item is used in the direct method or the indirect method.
a. Accounts payable
b. Payments to employees
c. Cash collections from customers
d. Accounts receivable
e. Payments to suppliers
Answer:
Indirect Method
a. Accounts payable increase or decrease
d. Accounts receivable increase or decrease.
The above are both used in the Indirect method and fall under Cashflow from Operating activities.
Direct Method
b. Payments to employees
c. Cash collections from customers
e. Payments to suppliers
The direct method involves the above and they all fall under Cash generated from operations.
Windsor, the owner of Windsor's Sandwiches, contacts Gary, a new supplier. He promises Gary that he will pay him $375 if Gary delivers 20 pounds of cheese the following morning. Gary promises to make the delivery as requested by Windsor. What type of contract is formed and why?
Answer: bilateral contract
Explanation:
Based on the information given in the question, the type of contract formed is a bilateral contact.
A bilateral contract refers to a contract whereby both parties that are involved make promises to perform a certain action. The promise of some party will be the consideration on which the promise of the other party will be based.
Since Windsor promises Gary that he will pay him $375 if Gary delivers 20 pounds of cheese the following morning and Gary promises to make the delivery as requested by Windsor, then this is a bilateral contract.
What is the first step in recording a transaction?
Answer:
The first step in the recording process is to analyze the transaction, determine the accounting entries and record them in the appropriate accounts. The analysis includes an examination of the paper or electronic record of the transaction, such as an invoice, a sales receipt or an electronic transfer.
Explanation:
On January 1, 2016, Belden, Inc. issued long-term notes payable for $50,000. The note will be paid over 10 years with payments of $5,000 plus 12% interest due each January 1, beginning January 1, 2017. Prepare the amortization schedule for the first three payments.
Answer:
Belden, Inc.
Amortization Schedule
Period PV PMT Interest Deduction Net Liability
2017 $50,000.00 $11,000.00 $6,000.00 $5,000.00 $45,000.00
2018 $45,000.00 $10,400.00 $5,400.00 $5,000.00 $40,000.00
2019 $40,000.00 $9,800.00 $4,800.00 $5,000.00 $35,000.00
Explanation:
a) Data and Calculations:
Long-terms payable = $50,000
Period of note = 10 years
First payment = $11,000 ($5,000 principal + $6,000 interest)
Interest rate = 12%
Long-term payable after January 1, 2017 = $45,000 ($50,000 - $5,000)
12% Interest on payable balance of $45,000 = $5,400
Second payment = $10,400 ($5,000 principal + $5,400 interest)
Long-term payable after January 1, 2018 = $40,000 ($45,000 - $5,000)
12% Interest on payable balance of $40,000 = $4,800
Third payment = $9,800 ($5,000 principal + $4,800 interest)
Long-term payable after January 1, 2019 = $35,000 ($40,000 - $5,000)
Pacific Cruise Lines is a defendant in litigation involving a swimming accident on one of its three cruise ships.
Required:
1. The likelihood of a payment occurring is probable, and the estimated amount is $1.11 million.
2. The likelihood of a payment occurring is probable, and the amount is estimated to be in the range of $0.91 to $1.11 million.
3. The likelihood of a payment occurring is reasonably possible, and the estimated amount is $1.11 million.
4. The likelihood of a payment occurring is remote, while the estimated potential amount is $1.11 million.
Record the necessary entry for the scenarios given above. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Enter your answers in dollars, not in millions, (i.e. 5.5 should be entered as 5,500,000).)
Answer: See explanation
Explanation:
The necessary journal entry with regards to the scenarios given above will be:
1. Debit Loss $1,110,000
Credit Contingent liability $1,110,00
2. Debit Loss $910,000
Credit Contingent Liability $910,000
3. No journal entry
4. No journal entry
Note that there won't be a journal entry for (3) and (4) since the likelihood of a payment occurring is reasonably possible, and remote.
Jobs Inc. has recently started the manufacturer of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 21, 300 Tri-Robos is as follows.
Cost
Direct materials $1,086,300
Direct labor ($39 per robot) 830,700
Variable overhead ($5 per robot) 106,500
Allocated fixed overhead ($28 per robot) 600,000
Total $2,623,500
Jobs is approached by Tiench Inc, which offers to make Tri-Robo for $113 per unit of $2,406,900.
Following are independent.
Assume that $405,000 of the fixed overhead cost can be avoided. Enter negative amount.
Make Buy Net Income Increase (Decrease)
Direct materials $ $ $
Direct labor
Variable overhead
Fixed overhead
Purchased price
Totals $ $ $
Using incremental analysis, determine whether Jobs should accept this offer.
The offer _____
Assume that none of the fixed can be avoided. However, if the robots are purchased from Tienh Inc, Jobs can use the released productive resources to generate additional income f $375,000 Enter negative amount.
Make Buy Net Income Increase (Decrease)
Direct materials $ $ $
Direct labor
Variable overhead
Fixed overhead
Opportunity cost
Purchased price
Totals $ $ $
Based on the above assumptions, indicate whether the offer should be accepted or rejected?
The offer _____
Answer:
Jobs Inc.
1. The offer should not be accepted.
2. The offer should be accepted.
Explanation:
a) Data and Calculations:
Units of Tri-Robos to be manufactured = 21,300
Costs of manufacturing:
Direct materials $1,086,300
Direct labor ($39 per robot) 830,700
Variable overhead ($5 per robot) 106,500
Allocated fixed overhead ($28 per robot) 600,000
Total $2,623,500
Unit cost = $123.17 ($2,623,500/21,300)
Price from Tiench Inc per unit = $113
Total offer price = $2,406,900 ($113 * 21,300)
Make Buy Net Income Increase (Decrease)
Direct materials $1,086,300 $ $
Direct labor 830,700
Variable overhead 106,500
Fixed overhead 195,000
Purchased price 2,406,900
Totals $2,218,500 $2,406,900 $188,400 Decrease
Make Buy
Direct materials $1,086,300
Direct labor ($39 per robot) 830,700
Variable overhead ($5 per robot) 106,500
Allocated fixed overhead ($28 per robot) 600,000
Total $2,623,500 $2,406,900
Opportunity cost 375,000
Total $2,998,500 $2,406,900 $591,600
Sarah’s first questions for you have to do with the general ideas and terminology used to evaluate variances. Provide answers to the following questions (1)-(3). 1. Why might Sarah want to use standard costs to compare with her actual costs? a. Standard costs give management a cost structure for products that is applicable for the entire life of the business. b. Standard costs allow management to motivate employees by comparing their performance to what it would be under perfect conditions. c. Management can evaluate the differences between standard costs and actual costs to focus on correcting the cost variances.
Answer:
Sarah
The reason for Sarah to want to use standard costs to compare with her actual costs is:
c) Management can evaluate the differences between standard costs and actual costs to focus on correcting the cost variances.
Explanation:
Standard costs provide a control technique for evaluating the performance of Sarah's company at three levels: a standard performance level, a measure of actual performance, and a measure of the difference (variance) between standard and actual costs. Sarah will also use the variances resulting from the comparison of standard costs with actual costs to measure the non-financial performance of the entity.
Ahrends Corporation makes 70,000 units per year of a part it uses in the products it manufactures. The unit product cost of this part is computed as follows: Direct materials $ 17.80 Direct labor 19.00 Variable manufacturing overhead 1.00 Fixed manufacturing overhead 17.10 Unit product cost $ 54.90 An outside supplier has offered to sell the company all of these parts it needs for $48.50 a unit. If the company accepts this offer, the facilities now being used to make the part could be used to make more units of a product that is in high demand. The additional contribution margin on this other product would be $273,000 per year. If the part were purchased from the outside supplier, all of the direct labor cost of the part would be avoided. However, $8.20 of the fixed manufacturing overhead cost being applied to the part would continue even if the part were purchased from the outside supplier. This fixed manufacturing overhead cost would be applied to the company's remaining products. What is the financial advantage (disadvantage) of purchasing the part rather than making it
Answer:
$147,000
Explanation:
The computation of the financial advantage (disadvantage) of purchasing the part rather than making it is shown below;
Particulars Make Buy
Direct material $1,246,000 (70,000 × $17.80)
Direct labour $1,330,000 (70,000 × $17.80)
Variable manufacturing
overhead $70,000 (70,000 × $1)
Fixed manufacturing
overhead $623,000 (70,000 × ($17.10 - $8.20))
Purchase cost $3,395,000 (70,000 × $48.50)
Opportunity cost $273,000
Total cost $3,542,000 $3,395,000
So, the Advantage is
= ($3,542,000 - $3,395,000)
= $147,000
The financial advantage that Ahrends Corporation will get by purchasing the part rather than making it is $147,000.
Data and Calculations:
Number of units produced per year = 70,000
Direct materials $ 17.80
Direct labor 19.00
Variable manufacturing overhead 1.00
Total variable costs = $37.80
Fixed manufacturing overhead 17.10
Unit product cost $ 54.90
Outside supplier's price = $48.50
Total avoidable costs:
Direct materials $ 17.80
Direct labor 19.00
Variable manufacturing overhead 1.00
Fixed manufacturing cost = 8.90
Total avoidable costs = $46.70
Make Buy Differential Analysis
Variable costs $3,269,000 $3,395,000 ($126,000)
Additional contribution (273,000) 273,000
Total costs/savings $3,269,000 $3,122,000 $147,000
Thus, Ahrends Corporation will gain $147,000 by purchasing the part rather than making its in-house.
Learn more: https://brainly.com/question/23412337
When a monopolist increases the amount of output that it produces and sells, the price of its output Group of answer choices stays the same. increases. decreases. may increase or decrease depending on the price elasticity of demand.
Answer:
Decreases
Explanation:
Monopolist is the sole seller of a good or service in a market. Eg : Indian Railways
It has a downward sloping demand curve, implying price & quantity demanded are inversely related. So, more quantity can be sold at lower prices, & higher price leads to less quantity sold.
Hence : When a monopolist increases the amount of output that it produces and sells, the price of its output Decreases.
What happens if you only make the minimum payment on your credit card statement? |
Answer:
then your credit does not go into default
Explanation:
tell me if im right please if im not sorry
Road Master Shocks has 15,000 units of a defective product on hand that cost $80,000 to manufacture. The company can either sell this product as scrap for $6 per unit or it can sell the product for $9 per unit by reworking the units and correcting the defects at a cost of $40,000. Prepare a schedule to show the effect of selling the defective units as scrap or rework.
Answer:
If the units are reworked, net income will increase by $5,000.
Explanation:
Giving the following information:
Number of units= 15,000
Sell as-is:
Selling price= $6 per unit
Rework:
Selling price= $9
Total cost= $40,000
The original production costs ($80,00) should not be taken into account because they remain constant for the two options.
Now, we will determine the effect on the income of both choices:
Sell as-is:
Effect on income= 6*15,000= $90,000 increase
Re-work:
Revenue= 15,000*9= 135,000
Total cost= (40,000)
Effect on income0 $95,000 increase
If the units are reworked, net income will increase by $5,000.
On June 17, the Lattern Company issued 120,000 shares of its $0.10 par value common stock in exchange for land. On the date of the transaction, the fair value of the common stock, evidenced by its market price, was $10 per share. The journal entry to record this transaction includes:
Answer:
Debit : Land $1,200,000
Explanation:
The journal entry lattern Company need to record is
Dr Land $1,200,000
------------ Cr Credit common shares $12,000
------------ Cr Paid in capital - Common shares $1,188,000
As 120,000 shares is exchanged, for the land and the share is traded in the exchange, the value of the land should be recorded at the market price of this
= 120,000 shares or 120,000 × $10 = $1,200,000
Common share account is recorded at lar value x number of shares issued = $0.1 × $120,000 = $12,000 while paid in capital common share account records the difference between market price and par value at the time of shares issuance or
= (10 - 0.1) × 120,000
= $1,188,000
A TV ad run by Miller Lite is a response to a controversial Bud Light campaign. Bud Light made headlines with the claim that its beer is healthier due to the lack of corn syrup. Miller responded with a parody of its competitor's campaign. This is an example of _______.
Answer:
Comparative advertising
Explanation:
In this comparative advertising strategy, the product of the company would be compared as the superior product with the competitor.
Since in the given situation, the miller lite compared its beer with the bud light
So this given situation represent the example of comparative advertising where the products of the two company are compared
Therefore the above represent the answer
Hardy Company must maintain a compensating balance of $50,000 in its checking account as one of the conditions of its short-term 6% bank loan of $500,000. Hardy's checking account earns 2% interest. Ordinarily, Hardy would maintain a $20,000 balance in the account for transaction purposes. What is the loan's approximate effective interest rate
Answer:
The loan's approximate effective interest rate is 6.17%.
Explanation:
Interest expense = Short term bank loan * Short term bank loan interest rate = $500,000 * 6% = $30,000
Interest income = Balance in the account checking account * Interest rate on checking account balance = $20,000 * 2% = $400
Net interest expense = Interest expense - Interest income = $30,000 - $400 = $29,600
Available amount = Short term bank loan interest rate - Balance in the account checking account = $500,000 - $20,000 = $480,000
Effective interest rate = Net interest expense / Available amount = $29,600 / $480,000 = 0.0617, or 6.17%
Therefore, the loan's approximate effective interest rate is 6.17%.
he average borrowing rate for interest bearing debt is calculated as: Select one: A. Interest Expense divided by Average Interest-bearing Debt B. Interest Expense divided by Average Long-term Debt C. Interest Paid divided by Average Liabilities D. Interest Expense divided by Average Liabilities
Answer:
A. Interest Expense divided by Average Interest-bearing Debt
Explanation:
A bond can be defined as a debt or fixed investment security, in which a bondholder (investor or creditor) loans an amount of money to the bond issuer (government or corporations) for a specific period of time. The bond issuer are expected to return the principal (face value) at maturity with an agreed upon interest (coupon), which are paid at fixed intervals.
An interest-rate risk can be defined as the risk associated with bond owners due to fluctuating interest rates. This risk has a direct level of impact on the value of fixed income securities such as bonds.
An interest rate can be defined as an amount of money that is charged as a percentage of the total amount borrowed from an individual or a financial institution.
Mathematically, the average borrowing rate (ABR) for an interest bearing debt is calculated using the formula;
[tex] ABR = \frac {Interest \; Expense}{Average \; Interest \ bearing \; Debt} [/tex]
A hospitality company is evaluating building a new hotel in Bloomington (capital project) that management forecasts will generate $45,000 each year over its six (6) year life. If the required rate of return given the project's identified risks is 12% (percent), and the project's up front costs are estimated at $165,000, should management go forward with the project?
a. Management should approve the new hotel since the project's NPV is positive.
b. Management should reject the new hotel project as the project's NPV is negative.
c. Unable to determine given information.
Answer:
A
Explanation:
Net present value is the present value of after-tax cash flows from an investment less the amount invested.
Only projects with a positive NPV should be accepted. A project with a negative NPV should not be chosen because it isn't profitable.
When choosing between positive NPV projects, choose the project with the highest NPV first because it is the most profitable.
NPV can be calculated using a financial calculator
Cash flow in year 0 = $-165,000
Cash flow in year 1 - 6 = $45,000
I = 12%
NPV = $20,013.33
the project should be approved because NPV is positive
To find the NPV using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
Sutherland manufactures and sells 50,000 laser printers each month. A principal component part in each printer is its paper feed drive. Sutherland's plant currently has the monthly capacity to produce 80,000 drives. The unit costs of manufacturing these drives (up to 80,000 per month) are as follows. Variable costs per unit: Direct materials $ 23 Direct labor 15 Variable manufacturing overhead 2 Fixed costs per month: Fixed manufacturing overhead $ 1,300,000 Desk-Mate Printers has offered to buy 10,000 paper feed drives from Sutherland to be used in its own printers. a. Compute the average unit cost of manufacturing each paper feed drive assuming that Sutherland manufactures only enough drives for its own laser printers. b. Compute the incremental unit cost of producing an additional paper feed drive. c. Compute the per-unit sales price that Sutherland should charge Desk-Mate to earn $140,000 in monthly pretax profit on the sale of drives to Desk-Mate.
Answer:
Sutherland
a. The average unit cost of manufacturing each paper feed drive is:
= $56.25.
b. The incremental unit cost of producing an additional paper feed drive is:
= $170.
c. The per-unit sales price that Sutherland should charge Desk-Mate to earn $140,000 in monthly pre-tax profit on the sale of drives to Desk-Mate is:
= $184.
Explanation:
a) Data and Calculations:
Production and sales of laser printers per month = 50,000
Monthly production capacity for paper feed drives = 80,000
Unit costs of producing drives:
Variable costs per unit:
Direct materials $ 23
Direct labor 15
Variable manufacturing overhead 2
Variable cost per unit $40 $3,200,000 (80,000 * $40)
Fixed costs per month:
Fixed manufacturing overhead $1,300,000
Total production costs = $4,500,000
Average unit cost = $56.25 ($4,500,000/80,000)
Incremental unit cost of producing an additional paper feed drive:
Variable cost = $40 * 10,000 = $400,000
Additional fixed cost per month = $1,300,000
Total incremental costs = $1,700,000
Unit cost = $170 ($1,700,000/10,000)
Total incremental costs = $1,700,000
Monthly pre-tax target profit 140,000
Expected sales revenue = $1,840,000
Sales price per drive = $184 ($1,840,000/10,000)
Which account option may require larger money contributions than usual but offers a higher interest rate than traditional savings?
Certificate of deposit
Checking
Money market
Saning
Answer:
Money Market
Explanation:
I just did this
The Bay Fig Corporation has $350,000 of taxable income from operations for the current year, and dividends of $50,000 received from 10-percent-owned domestic corporations. How much is the Bay Fig Corporation's dividends received deduction for the current year
Answer: $25,000
Explanation:
When a company owns less than 20% of another company and receives dividends from that company, they are allowed to deduct 50% of that dividend for tax purposes.
Bay Fig owns 10%(less than 20%) of the domestic corporations so qualifies for the 50% reduction:
= Dividends * 50%
= 50,000 * 50%
= $25,000