Solution :
The probability of the payoff is greater than equal to $ 20 that will be fulfilled when the price of the stock crosses 170. But at price 180, the payoff will get stabilize.
Now the price of the BOA follows lognormal distribution, the continuous returns would follow the Normal distribution.
∴ So for the payoff of $ 20 or more than that, return has to be [tex]$\ln(170/150)=12.5163 \%$[/tex] Pa or more than that. So, x = 12.5163 %
[tex]$Z=\frac{x-\text{mean}}{s_d}$[/tex]
[tex]$=\frac{12.5163-10}{20}$[/tex]
= 0.12582
∴ Using Z table, the cumulative probability to the left side = [tex]$0.550061$[/tex]
But the probability of the return which is more than 12.5163 % is given by :
= 1 - 0.55061
= 0.449939
= 0.45
ABC has not ordered linen in some time, but when it did order in the past it ordered frequently, and its orders were of the highest monetary value. Under the given circumstances, Ajax is most likely to have an RFM score:________
Answer: 511
Explanation:
The RFM model enables a company to group its customers by their buying habits such that they can be treated accordingly to ensure repeated sales.
The three categories are:
Date of last purchaseFrequency of purchaseMonetary value of purchasesThe range is 0 - 5 with a higher number representing higher scores.
This particular customer will get a 5 for date of last purchase to indicate that it has been a while since they last purchased.
They will get a 1 for frequency because they haven't purchased in high frequency in a while but because they used to buy a lot, we give it a 1 instead of 0.
They will also get a 1 for the monetary value for the same reason as above.
Presidential Profits. Linda was president of a publicly traded tractor company, Tough Tractors. Linda became aware that stock in her company would likely increase significantly in value because her company had a contract to purchase the assets of Rough Tractors. The boards of both companies wanted the information kept confidential until the purchase was complete and a news release was made. Before the news was made public, Linda immediately purchased a significant number of shares in Tough Tractors. Linda also told her friend Frank about the contract to purchase assets. Frank, who knew that the information was not public, told his brother, George. Frank and George purchased a number of shares of stock in Tough Tractors prior to any public announcement of the sale. After the public announcement was made and the purchase of assets went through, Linda, George and Frank, all sold their shares in Tough Tractors and made a significant profit. Which of the following describes Frank in providing information about the asset sale to George?
A. Tipper.
B. Third-party beneficiary.
C. Informant.
D. Leaker.
E. Enabler.
Answer: Tipper
Explanation
An act whereby non-public information regarding a publicly traded company is provided to a person who shouldn't have the information is referred to as tipping.
In this case, Frank is a tipper since he passed the information to George whom is the tippee in order to gain profit. Therefore, the correct option is A.
7. How can you use nonverbal communication to express an idea to someone?
Bertucci Corporation makes three products that use the current constraint which is a particular type of machine. Data concerning those products appear below:
TC GL NG
Selling price per unit $ 494.40 $ 449.43 $ 469.68
Variable cost per unit $ 395.20 $ 320.21 $ 373.92
Minutes on the constraint 8.00 7.10 7.60
Assume that sufficient constraint time is available to satisfy demand for all but the least profitable product. Up to how much should the company be willing to pay to acquire more of the constrained resource?
a. $12.40 per minute
b. $18.20 per minute
c. $129.22 per unit
d. $95.76 per unit
Answer:
Bertucci Corporation
The amount the company should be willing to pay to acquire more of the constrained resource per minute is:
a. $12.40 per minute
Explanation:
a) Data and Calculations:
TC GL NG
Selling price per unit $ 494.40 $ 449.43 $ 469.68
Variable cost per unit $ 395.20 $ 320.21 $ 373.92
Contribution per unit $99.20 $129.22 $95.76
Minutes on the constraint 8.00 7.10 7.60
Contribution per minutes $12.40 $18.20 $12.60
Answer:
M
Explanation:
Lisa and Bob, potential business associates, met at a bar and grill regarding a new business venture they had been planning. Lisa brought a typed of copy of a contract, listing specific responsibilities and financial commitments that would be a part of the business venture. They both discussed the business venture under a nice meal. Since Lisa does not drink alcohol, she did not order any alcoholic beverages. Bob does and started off with a few drinks and throughout the night, increased them quite a bit to the point that he was so intoxicated he realized the smart thing to do was not do drive. He left his car at the restaurant and had Uber take him home. Bob also signed the contract that Lisa brought.
Required:
a. Is this a valid contract that can be enforced why or why not?
b. How about if Bob signed the contract before his drinks arrived?
c. What about if Bob was a minor and sober and signed the contract? Is the contract valid?
Answer & Explanation:
a). The contract between Lisa and Bob is valid and enforceable as a valid contract is an agreement between parties lacking no element. The contract was very detailed and well discussed regardless of Bob drinking it is still enforceable unless Bob can proof that the intoxication impaired his judgement and made him incompetent to sign the contract thereby making it void.
b). The contract will be valid if Bob signed it before the drinks arrived as the document was complete and his signature show acceptance of the terms of the contract.
c). A minor can not enter into a contract as they may lack the capacity to enter into a valid contract. As such, if Bob was a minor regardless of him being sober any contract signed by him can be completely voidable.
December 1, Smiles, Inc. prepays $2,400 for three months of rent. On December 31, Smiles prepares financial statements. After the appropriate adjusting entry for rent, Smiles’ balance sheet would show:________
a. prepaid Rent of $2,400.
b. rent Expense of $800.
c. prepaid Rent of $1,600.
d. prepaid Rent of $800.
Answer:
c. prepaid Rent of $1,600.
Explanation:
Based on the information given we were told that the company prepays the amount of $2,400 for three months of rent which means that After the appropriate adjusting entry for rent, Smiles’ balance sheet would show: PREPAID RENT OF $1,600.
Prepaid Rent of $1,600
[$2,400-(2,400/3)]
=$2,400-$800
=$1,600
Tiger, Inc., a calendar year S corporation, is owned equally by four shareholders: Ann, Becky, Chris, and David. Tiger owns investment land that was purchased for $160,000 four years ago. On September 14 of the current year when the land is worth $240,000, it is distributed to David. Assume that David's basis in his S corporation stock is $270,000 on the distribution date.
Required:
Discuss any Federal income tax ramifications.
Answer:
Capital gain $80,000
Shareholder $20,000
David Basis $50,000
Explanation:
Calculation to Discuss any Federal income tax ramifications
Calculation to discuss the CORPORATE LEVEL, capital gain Federal income tax ramifications
Using this formula
Capital gain =Land Worth - Purchased value of land
Let plug in the formula
Capital gain= $240,000 - $160,000
Capital gain= $80,000
Therefore CORPORATE LEVEL, capital gain Federal income tax ramifications will be $80,000
SHAREHOLDERS
Based on the information given we have 4 shareholders which means that the amount each shareholder held will be:
Shareholder= $80,000 ÷ 4
Shareholder= $20,000
DAVID BASIS
Based on the information given David Basis in S corporation will be calculated as:
David Basis= $270,000 - $240,000 + $20,000
David Basis= $50,000
Therefore David Basis in S corporation will be $50,000
The Five & Dime store has a cost of equity of 15.8%, a pretax cost of 7.7%, and a tax rate of 35%. What is the firm's weighted average cost of capital if the debt-equity ratio is 0.40?
a. 10.18
b. 11.72
c. 12.72
d. 13.49
e. 14.93
Answer: 12.72%
Explanation:
The firm's weighted average cost of capital if the debt-equity ratio is 0.40 will be calculated thus:
= (1 /1+debt equity ratio)(cost of equity) + (Debt Equity ratio/1 + Debt Equity ratio)(Pre-tax cost)(1 - Tax rate)
=(1/1.40)(0.158) + (0.40/1.40)(0.077)(1 - 0.35)
= 12.72%
The firm's weighted average cost of capital is 12.72%
On January 1, 2021, White Water issues $570,000 of 7% bonds, due in 10 years, with interest payable annually on December 31 each year. Assuming the market interest rate on the issue date is 7%, the bonds will issue at $570,000. Record the bond issue on January 1, 2021, and the first two interest payments on December 31, 2021, and December 31, 2022.
Required:
1. Complete the first three rows of an amortization schedule.
Date Cash Paid Interest Expense Increase in Carrying Value Carrying Value
01/01/2021
12/31/2021
12/31/2022
2. Record the bond issue on January 1, 2021, and the first two interest payments on December 31, 2021, and December 31, 2022.
Answer:
White Water
1. Schedule
Date Cash Paid Interest Expense Increase in Carrying value FV
01/01/2021 0 $570,000.00
12/31/2021 $39,900.0 $39,900.00 0 $570,000.00
12/31/2022 $39,900.0 $39,900.00 0 $570,000.00
2. January 1, 2021:
Debit Cash $570,000
Credit 7% Bonds Payable $570,000
To record the issue of bonds for cash.
December 31, 2021:
Debit Interest Expense $39,900
Credit Cash $39,900
To record the first interest payment.
December 31, 2022:
Debit Interest Expense $39,900
Credit Cash $39,900
To record the second interest payment.
Explanation:
a) Data and Calculations:
Face value of 7% bonds = $570,000
Proceeds from the bond issue = $570,000
No premiums, no discounts on bonds.
Coupon interest rate = 7%
Market interest rate = 7%
Organic Laboratories allocates research and development costs to its three research facilities based on each facility's total annual revenue from new product developments:______.
Facility location Kentucky Arizona Illinois Total New product revenue $ 56,000,000 $ 100,000,000 $ 84,000,000 $ 240,000,000
Research & Development $ 90,000,000
Using revenue as an allocation base, the amount of costs allocated to the Illinois research facility is calculated to be:_______.
Answer:
Amount of costs allocated to the Illinois research facility = $31,500,000
Explanation:
Given:
Research cost
Kentucky = $56,000,000
Arizona = $100,000,000
Illinois = $84,000,000
Research and development cost = $90,000,000
Find:
Amount of costs allocated to the Illinois research facility
Computation:
Amount of costs allocated to the Illinois research facility = Research cost of Illinois[Research and development cost / Total research cot]
Amount of costs allocated to the Illinois research facility = 84,000,000[90,000,000 / (56,000,000 + 100,000,000 + 84,000,000)]
Amount of costs allocated to the Illinois research facility = 84,000,000[90,000,000 / (240,000,000)]
Amount of costs allocated to the Illinois research facility = 84,000,000[0.375]
Amount of costs allocated to the Illinois research facility = $31,500,000
Blue Spruce Corp. purchased equipment on January 1, 2021 for $162,000. It is estimated that the equipment will have a $9,000 salvage value at the end of its 5-year useful life. It is also estimated that the equipment will produce 180,000 units over its 5-year life.
Answer the following independent questions.
Compute the amount of depreciation expense for the year ended December 31, 2021 using the straight-line method of depreciation.
Answer:
Annual depreciation= $30,600
Explanation:
Giving the following information:
Purchase price=$162,000
Salvage value= $9,000
Useful life= 5 years
To calculate the annual depreciation, we need to use the following formula:
Annual depreciation= (original cost - salvage value)/estimated life (years)
Annual depreciation= (162,000 - 9,000) / 5
Annual depreciation= $30,600
Jim promises to marry Martha if Martha agrees to pay him a $10,000/month allowance as long as they are wedding. If this contract was not written, then once they are married Jim can still enforce the contract if Martha refuses to pay.
a. True
b. False
Jim promises to marry Martha if Martha agrees to pay him a $10,000/month allowance as long as they are wedding. If this contract was not written, then once they are married Jim can still enforce the contract if Martha refuses to pay. This statement is True.
What is Contract?A contract is an agreement between parties that establishes legal duties for both parties. The fundamental components necessary for the agreement to be a valid offer and acceptance, adequate consideration, capacity, and legality are: mutual assent, expressed through a contract-compliant offer.
Contracts are legal obligations that contain promises. State common law primarily governs contract law, and while broad contract law is prevalent nationwide, different state courts may have different interpretations of particular contract clauses.
Contracts are created when one party's promise results in the creation of a duty between the parties. A promise must be given in exchange for sufficient consideration in order for it to be regarded as a contract. There are two various theories or definitions to take into account: Benefit-Detriment theory of consideration and the bargain theory of consideration
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Which of the following is true of resumes?
A personal cover letter should be included with a resume.
A resume is not necessary if you completed an application.
The formats of electronic and hard copy resumes are the same.
An objective tells an employer what the applicant learned in school.
Answer:
Hello! Your answer would be, BELOW
Explanation:
Job objective should be listed last
Use action words when describing your experience.
These are the statements that are true about resumes. Resumes should include job objectives. However, these should be listed at the end of the resume. A second thing to remember when drafting a resume is that it is important to use action words to describe your experiences. This is because the statements become more interesting, and because this structure will highlight the role that you played in each instance.
Hope I helped! Brainiest plz! Hope you make an 100% and have a wonderful day! -Amelia♥
list three classified ways of getting into small business?
Answer:
sole , partnership , team business
The following data are taken from the financial statements of Crane Company.
2022 2021 Accounts receivable (net), end of year $ 567,900 $ 555,000 Net sales on account 4,831,000 4,179,000 Terms for all sales are 1/10, n/45
1) Compute for each year the accounts receivable turnover. At the end of 2015, accounts receivable was $511,500. (Round answers to 1 decimal place, e.g. 12.5.)
2) Compute for each year the average collection period. (Round answers to 1 decimal place, e.g. 12.5. Use 365 days for calculation.)
Answer and Explanation:
The computation is shown below;
(1)
As we know that
The receivables turnover = Net credit sales ÷ Average account receivable
For the year 2017
Receivables turnover = $4,831,000 ÷ $561,450 = 8.60 times
for the year 2016:
Receivables turnover = $4,179,000 ÷ $533,250 = 7.84 times
Average net AR = (Beginning AR + Ending AR) ÷ 2
2017 = ($567,900 + $555,000) ÷ 2 = $561,450
2016 = ($555,000 + $511,500) ÷ 2 = $533,250
(2)
The average collection period = 365 days ÷ Receivables turnover
For 2017:
Average collection period = 365 ÷ 8.60 = 42.44 days
For 2016
Average collection period = 365 ÷ 7.84 = 46.56 days
Super Smarts University has a sticker price of $45,000 per year. Kyle is applying there and uses their online net price calculator, which calculates a net price of $38,000 per year based on the information he is provided. He's #1 in his high school class, and he's got great SAT scores; so he's pretty sure he'll get in. How much will Kyle pay to attend?
Multiple Choice
A.) The exact net price
B.) Within a range of $5000 of the sticker price
C.) $0, because he'll likely get a full ride due to his high school achievements and scores
D.) It's impossible to know how much he'll pay until he receives his financial aid package
Answer:
A
Explanation:
The amount payable by Kyle to attend Super Smarts University is A. the exact net price.
The net price is usually the amount that a student pays to attend an educational institution for an academic year after the subtraction of the scholarships and grants the student receives.
Kyle will not pay $5,000 of the sticker price or $0 because of full scholarships and grants. Again, it is possible to know the amount Kyle will pay with the net price calculator.
Thus, the correct option is A because with the net price calculator, Kyle should determine the amount he will pay attending Super Smarts University annually.
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On December 31, the trial balance shows wages expense of $390. An additional $130 of wages was earned by the employees, but has not yet been paid. Analyze this adjustment for wages using T accounts, and then formally enter this adjustment in the general journal. (Trial balance is abbreviated as TB.)
(Income Statement)
Wages Expense
(Balance Sheet)
Wages Payable
Page:
CREDIT DATE DOC. POST NO. REF ACCOUNT TITLE DEBIT 1 20- Dec. 31 1 2 2
Answer:
(Income Statement)
Wages Expenses
Trial balance $390 |
Adjustment $130 |
Balance $520 |
(Balance Sheet)
Wages Payable
| Adjustment $130
Date Account Titles Debit Credit
Dec 31 Wages expenses $130
2020 Wages payable $130
Farrina Manufacturing uses a predetermined overhead application rate of $8 per direct labor hour. A review of the company's accounting records for the year just ended discovered the following: Underapplied manufacturing overhead: $7,200 Actual manufacturing overhead: $392,000 Budgeted labor hours: 50,000
Simone's actual labor hours worked totaled:_______.
a. 49,100.
b. 49,900.
c. 48,100.
d. 50,900.
e. cannot be determined based on the information presented.
Answer:
c. 48,100.
Explanation:
The computation of the actual labor hours worked is shown below;
Actual Overhead $392,000.00
Less: Underapplied overhead $7,200.00
Applied Overhead ($392,000 - $,7200) $384,800.00
Predetermined overhead rate $8.00
Actual labor hours ($384,800 ÷ 8) $48,100
hence, the actual labor hours worked is $48,100
Therefore the option c is correct
Farrina Manufacturing uses a predetermined overhead application rate of $8 per direct labor hour. A review of the company's accounting records for the year just ended discovered the following: Underapplied manufacturing overhead: $7,200 Actual manufacturing overhead: $392,000 Budgeted labor hours: 50,000
Simone's actual labor hours worked totaled:_______.
a. 49,100.
b. 49,900.
c. 48,100.d. 50,900.
e. cannot be determined based on the information presented.
-KeonLee
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(Learning Outcome 2) Watson Plumbing performed plumbing services for ABC Daycare on account for $565. How will this transaction affect ABC Daycare's accounting equation?
Answer:
ABC Daycare
Effect of Performing Plumbing Services on account on the Accounting Equation:
Assets (Accounts receivable) will increase by $565 and Equity (Retained Earnings) will equally increase by $565
Explanation:
a) Data and Analysis:
Accounts receivable $565 Service Revenue $565
The accounting equation that equals assets to liabilities and equity is always true at all times and with every correctly posted transaction. It implies that assets are financed through the contributions made by either the owners (equity) or the creditors (debts), or a combination of the two. This equation forms the basis for the double-entry system of financial accounting.
Match the accounting terms with the corresponding definitions.
Accounting term
1. Specific identification
2. Materiality concept
3. Last-in, first-out (LIFO)
4. Conservatism
5. Consistency principle
6. Weighted-average
7. Disclosure principle
8. First-in, first-out (FIFO)
Definitions
A. Treats the oldest inventory purchases as the first units sold.
B. Requires that a company report enough information for outsiders to make knowledgeable decisions.
C. Identifies exactly which inventory item was sold. Usually used for higher cost inventory.
D. Calculates a weighted-average cost based on the cost of goods available for sale and the number of units available.
E. Principle whose foundation is to exercise caution in reporting financial statement items.
F. Treats the most recent/newest purchases as the first units sold.
G. Businesses should use the same accounting methods from period to period.
H. Principle that states significant items must conform to GAAP.
Answer:
Matching Accounting Terms with Corresponding Definitions:
Accounting Terms Definitions:
1. Specific identification C.
2. Materiality concept H.
3. Last-in, first-out (LIFO) F.
4. Conservatism E.
5. Consistency principle G.
6. Weighted-average D.
7. Disclosure principle B.
8. First-in, first-out (FIFO) A.
Explanation:
Definitions
A. FIFO: Treats the oldest inventory purchases as the first units sold.
B. Disclosure principle: Requires that a company report enough information for outsiders to make knowledgeable decisions.
C. Specific identification: Identifies exactly which inventory item was sold. Usually used for higher cost inventory.
D. Weighted-average: Calculates a weighted-average cost based on the cost of goods available for sale and the number of units available.
E. Conservatism: Principle whose foundation is to exercise caution in reporting financial statement items.
F. LIFO: Treats the most recent/newest purchases as the first units sold.
G. Consistency Principle: Businesses should use the same accounting methods from period to period.
H. Materiality Concept: Principle that states significant items must conform to GAAP.
In a query, if you want to summarize the data and use a sum to apply addition to the summarized data, use the _____ tool.
SUM
Add
Summarize
Totals
Suppose that a Treasury coupon security is purchased on April 8 and that the last coupon payment was on February 15. Assume that the year in which this security is purchased is not a leap year.
(a) How many days are in the accrued interest period?
(b) If the coupon rate for this Treasury security is 7% and the par value of the issue purchased is $1 million, what is the accrued interest?
Answer:
A. 52 days
B. $1.00
Explanation:
A. Calculation to determine How many days are in the accrued interest period
February 15 to February 28 14 days
March (31 days in March) 31 days
April 1 to April 8 7 days
Actual number of days 52 days
(14 days+ 31 days+7 days)
Therefore The number of days that are in the accrued interest period is 52 days
B. Calculation to determine the accrued interest
Using this formula
Accrued interest=(Annual Dollar Coupon/2)x (Days in Accrued interest /Days in Coupon)
Let plug in the formula
Accrued interest=($7/2)x (52 days /182 days)
Accrued interest= $1.00
Note that February 15 through August 15 will give us 182 days in a coupon period
Therefore The Accrued interest is $1.00
Based on the graph, how many people are willing to work when the government of a country raises the minimum wage from $17 to $25?
A. 9
B. 12
C. 16
D. 19
E. 28
Answer:
Post Test: Government
Economics
Question #5
Based on the graph, how many people are willing to work when the government of a country raises the minimum wage from $17 to $25?
Answers:
A. 9
B. 12
C. 16
D. 19
E. 28
__________________________________________________________
The 100% correct answer is:
E. 28
Explanation:
I took the test and this is 100% it
Hope this helped
Tristen Company purchased a five-story office building on January 1, 2019, at a cost of $5,000,000. The building has a residual value of $200,000 and a 30-year life. The straight-line depreciation method is used. On June 30, 2021, construction of a sixth floor was completed at a cost of $1,650,000.
Required:
Calculate the depreciation on the building and building addition for 2018 and 2019 assuming that the addition did not change the life or residual value of the building.
Answer:
Depreciation expense on Building
Depreciation expense per annum under straight line method = (Cost - Residual value) / Useful life
= ($5,000,000 - $200,000) / 30
= $4,800,000 / 30
= $160,000
Depreciation expense for 2018 = $160,000
Depreciation expense for 2019 = $160,000
Depreciation expense on Building addition
Useful life = 30.00 years - 2.50 years = 27.50 years
Depreciation expense per annum under straight line method = (Cost - Residual value) / Useful life
= ($1,650,000 - $0) / 27.50
= $60,000
Depreciation expense for 2018 for 6 months = $60,000 * (6/12) = $30,000
Depreciation expense for 2019 = $60,000
Which of the following statement is not true for capital budgeting?
O a. Capital budgeting decisions are reversible in nature,
O b. Business expansion decision is a capital expenditure dedision,
O a Capital budgeting decisions affect the future stability of the firm
O d. Sunk cost is an irrelevant cost in capital budgeting
Answer:
a.
or Opportunity costs are excluded
Explanation:
Capital budgeting decisions involve huge funds and are long term decisions. As they involve huge costs one wrong decision would have a big effect on the business. They include all the potential expenses/costs. It includes opport
unity cost, actual cost, incremental and relevant cash flows. It does not include sunk costs.
The wrong statement is sunk cost is an irrelevant cost in capital budgeting.
What is capital budgeting?Capital budget is a budget meant for the continuous maintenance of the asset of an organization.
The assets involve in capital budgeting are :
LandBuildingEquipmentHence, the wrong statement is sunk cost is an irrelevant cost in capital budgeting.
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Please Help!
Rosa works as an administrative assistant for a clothing company. Which of the following tasks might she do in her
job?
Teaching young children how to read
Arranging travel plans for clients
Manage schedules and help with office meetings
Answer:
C. Manage schedules and help with office meetings
Scoring: Your score will be based on the number of correct matches. There is no penalty for incorrect or missing matches.
Match each phrase that follows with the term it describes.
Clear All
Evaluation of how profit will change based on an alternative course of action
Possible result of using an inappropriate overhead allocation method
Revenue forgone from an alternative use of an asset
Strategy that focuses on reducing the influence of bottlenecks
Not relevant to future decisions
Product cost distortion
Opportunity cost
Differential analysis
Sunk cost
Theory of constraints
Scoring: Your score will be based on the number of correct matches. There is no penalty for incorrect or missing matches.
Match each phrase that follows with the term it describes.
Clear All
Recognizes that a dollar today is worth more than a dollar tomorrow
Often referred to as the discounted cash flow method
Also referred to as capital budgeting
Average income as a percentage of average investment
Can be determined by initial cost divided by annual net cash inflow of an investment
Cash payback period
Capital investment analysis
Average rate of return
Net present value method
Time value of money concept
Scoring: Your score will be based on the number of correct matches. There is no penalty for incorrect or missing matches.
Match the following descriptions and examples with the four performance perspectives in the balanced scorecard.
Clear All
Focuses on operational efficiencies and issues like improving manufacturing performance
Focuses on obtaining and retaining customers and customer base
Focuses on traditional accounting measures of performance, such as net income and cash flow
Focuses on research and development initiatives and employee training, retention, and satisfaction efforts
Customer
Learning and growth
Internal processes
Financial
Answer:
1. Match each phrase that follows with the term it describes:
a. Evaluation of how profit will change based on an alternative course of action
Correct term: Differential analysis
b. Possible result of using an inappropriate overhead allocation metho
Correct term: Product cost distortion
c. Revenue forgone from an alternative use of an asset
Correct term: Opportunity cost
d. Strategy that focuses on reducing the influence of bottlenecks
Correct term: Theory of constraints
e. Not relevant to future decisions
Correct term: Sunk cost
2. Match each phrase that follows with the term it describes:
a. Recognizes that a dollar today is worth more than a dollar tomorrow
Correct term: Time value of money concept
b. Often referred to as the discounted cash flow method
Correct term: Net present value method
c. Also referred to as capital budgeting
Correct term: Capital investment analysis
d. Average income as a percentage of average investment
Correct term: Average rate of return
e. Can be determined by initial cost divided by annual net cash inflow of an investment
Correct term: Cash payback period
3. Match the following descriptions and examples with the four performance perspectives in the balanced scorecard:
a. Focuses on operational efficiencies and issues like improving manufacturing performance
Correct option: Internal processes
b. Focuses on obtaining and retaining customers and customer base
Correct option: Customer
c. Focuses on traditional accounting measures of performance, such as net income and cash flow
Correct option: Financial
d. Focuses on research and development initiatives and employee training, retention, and satisfaction efforts
Correct option: Learning and growth
Hoi Chong Transport, Ltd., operates a fleet of delivery trucks in Singapore. The company has determined that if a truck is driven 129,000 kilometers during a year, the average operating cost is 13.7 cents per kilometer. If a truck is driven only 86,000 kilometers during a year, the average operating cost increases to 16.8 cents per kilometer.
Requried:
a. Using the high-low method, estimate the variable and fixed cost elements of the annual cost of the truck operation.
b. Express the variable and fixed costs in the form Y = a + bX.
Answer:
A. Variable cost per unit 0.075 per kilometer
Fixed cost $7,998
B. Y= 0.075 + 7,998X
Explanation:
A. Calculation to estimate the variable and fixed cost elements of the annual cost of the truck operation.
First step is to calculate the operating cost if the Truck is driven 129,000 kilometers during a year in which the average operating cost is 13.7 cents per kilometer
Operating cost= 129,000 x 13.7/100
Operating cost= $17,673
Second step is to calculate the operating cost if Truck is driven only 86,000 kilometers during a year in which the average operating cost increases to 16.8 cents per kilometer.
Operating cost = 86,000 x 16.8/100
Operating cost =$14,448
Calculation for VARIABLE COST PER UNIT using this formula
Variable cost per unit = (Highest activity cost - Lowest activity cost)/(Highest activity - Lowest activity)
Let plug in the formula
Variable cost per unit= $17,673-$14,448)/(129,000-86,000)
Variable cost per unit= 3,225/43,000
Variable cost per unit= 0.075 per kilometer
Calculation for FIXED COST using this formula
Fixed cost = Highest activity cost - Highest activity x Variable cost per kilometer
Let plug in the formula
Fixed cost= $17,673 - 129,000 x 0.075
Fixed cost= $17,673 -$9,675
Fixed cost=$7,998
Therefore the variable is 0.075 per kilometer and fixed cost elements of the annual cost of the truck operation is $7,998
B. Expression of the variable and fixed costs in the form Y = a + bX.
Y = a + bX
Y= 0.075 + 7,998X
Therefore the variable and fixed costs in the form Y = a + bX will be Y= 0.075 + 7,998X
Which statement provides the correct information regarding the parts
and expectations of an IBC?
Take classes, take tests, earn certificates, get hired
Take classes, pass the classes, write an essay, graduate
Successfully pass all courses, take the ACT, take the EOC, fill out FAFSA
O Take classes, score high on tests, fill out applications, get hired
Answer:
I don't know but good luck finding the answer
Explanation:
On September 30, 2021, Bricker Enterprises purchased a machine for $212,000. The estimated service life is 10 years with a $21,000 residual value. Bricker records partial-year depreciation based on the number of months in service.
Depreciation (to the nearest dollar) for 2022, using sum-of-the-years'-digits method, would be:_________. (Do not round intermediate calculations.)
a. $33,859.
b. $31,282.
c. $37,583.
d. $56,700.
Answer:
a. $33,859
Explanation:
The computation of the depreciation expense for the year 2022 is given below;
The Depreciable Value of the Asset is
= Cost - Residual Value
= $212,000 - $21,000
= $191,000
Now
Total Sum of the Years is
= (1+2+3+4+5+6+7+8+9+10)
= 55
Now
Depreciation for the year 2022
For Jan 1st 2022 to Sept 30 is
= 10 ÷ 55 × 9 ÷ 12 × $191,000
= $26,045
And,
For Oct 1st Dec 31 is
= 9 ÷ 55 × 3 ÷ 12 × $191,000
= $7,813
So,
Depreciation expense is
= $26,045 + $7,814
= $33,859