Answer:
Present Value
Stream A $1,251.247
Stream B $1,300.316
Explanation:
The present value of a future sum is the amount that would be invested today at the prevailing interest rate to have the sum
Stream A
(100 × 1.08^9-1) + (400× 1.08^-2) + (400× 1.08^-3) + (400× 1.08^-4) + (300× 1.08^-5) = $1,251.247
Stream B
(300 × 1.08^9-1) + (400× 1.08^-2) + (400× 1.08^-3) + (400× 1.08^-4) + (100× 1.08^-5) = $1,300.316
Present Value
Stream A $1,251.247
Stream B $1,300.316
A company has net income of $187,000, a profit margin of 8.6 percent, and an accounts receivable balance of $126,370. Assuming 60 percent of sales are on credit, what is the company’s days’ sales in receivables?
Answer:
35.35 days
Explanation:
For the computation of company’s days’ sales in receivable first we do the following calculations
As we know that
Profit margin = Net income ÷ Sales
0.086 = 187,000 ÷ Sales
Sales = 2,174,418.605
So,
Credit sales = Sales × Sales percentage
= 2,174,418.605 × 0.6
= 1,304,651.163
Receivables turnover ratio = Credit sales ÷ Receivables
= 1,304,651.163 ÷ 126,370
= 10.3241
Now
Days sales in receivables = 365 ÷ Receivables turnover
= 365 ÷ 10.3241
= 35.35 days
Suppose that a landlord is interested in renting out a two-bedroom apartment for $1000 a month for the next year. The landlord requires rent to be paid at the beginning of the month, at which point he will deposit the rental check into a local savings account. If the annual interest that the tenant can earn on this account is 5% and interest is compounded monthly, how much will the tenant have in his savings account at the end of the year
Answer:
WHAT
Explanation:
Dinklage Corp. has 6 million shares of common stock outstanding. The current share price is $78, and the book value per share is $9. The company also has two bond issues outstanding. The first bond issue has a face value of $115 million, a coupon rate of 7 percent, and sells for 93 percent of par. The second issue has a face value of $100 million, a coupon rate of 6 percent, and sells for 105 percent of par. The first issue matures in 21 years, the second in 8 years. Both bonds make semiannual coupon payments. a. What are the company's capital structure weights on a book value basis? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., .1616.) b. What are the company’s capital structure weights on a market value basis? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., .1616.)
Answer:
Book value weight of equity is 0.2007
Book value weight of debt is 0.7993
Market value weight of equity is 0.6883
Market value weight of debt is 0.3117
Explanation:
The book value of the two bonds=$115 million+$100 million=$215 million
The book value of equity =6 million *$9=$54 million
weight of debt=$215/($215+$54)= 0.7993
weight of equity=$54/($215+$54)= 0.2007
Market value approach:
market value of equity=6 million*$78=$468 million
market of the first bond=$115 million*93%=$106.95 million
market value of the second bond=$100 million*105%=$105 million
total market value of bonds=$106.95 million+$105 million=$ 211.95 million
weight of debt=$211.95/($211.95+$468 )= 0.3117
weight of equity=$468/($211.95+$468 )= 0.6883
The supplies account has a balance of $1,200 at the beginning of the year and was debited during the year for $2,300, representing the total of supplies purchased during the year. If $650 of supplies are on hand at the end of the year, the supplies expense to be reported on the income statement for the year is Group of answer choices
Answer:
Supplies expense to be recorded = $2,850
Explanation:
Beginning account balance = $1,200
debit during the year = $2,300. This means that a transaction of $2,300 was used for supply purchase during the year
balance on hand = $650
difference between beginning and ending inventory = 1200 - 650 = $550
This means that an expense of $550 was carried out during the year.
Therefore, total expense during year = 550 + purchase expense
= 550 + 2300 = $2,580
Alternatively, the supply expense reported can be calculated with the formula:
Supplies expense = beginning inventory + supplies purchased - ending inventory
Supplies expense = 1200 + 2300 - 650 = $2,850
Based on the supplies opening balance, the supplies purchased and other details, the supplies expense must be $2,850
The supplies expense can be calculated as:
= Beginning balance + Supplies purchased - Closing balance
Solving would give:
= 1,200 + 2,300 - 650
= $2,850
In conclusion, the supplies expense in the income statement will be $2,850
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Day Corp. holds 10,000 shares of its $10 par value common stock as treasury stock reacquired in Year 2 for $120,000. On December 12, Year 4, Day reissued all 10,000 shares for $190,000. Under the cost method of accounting for treasury stock, the reissuance resulted in a credit to:___________
Answer:
Credit of Additional paid-in capital of $70,000
Explanation:
Under the cost method of accounting for treasury stock, the reissuance resulted in a credit to: Additional paid-in capital of $70,000
Treasury stock reacquired in Year 2 $120,000
Less Year 4, reissued $190,000
Balance $70,000
Hence the $70,000 will be the additional Paid-in capital because the Treasury stock was reacquired in Year 2 $120,000 in which later in Year 4, $190,000 was reissued .
Therefore Under the cost method of accounting for treasury stock, the reissuance resulted in a credit to: Additional paid-in capital of $70,000
Bertrand Inc. performed services for clients in the amount of $1,600 on credit. If this transaction had been posted in error to the Cash account instead of the Accounts Receivable account, what correcting entry would be necessary? Multiple Choice Debit Accounts Receivable $1,600; credit Cash $1,600 Debit Cash $1,600; credit Accounts Receivable $1,600 Debit Accounts Receivable $1,600; credit Fees Income $1,600 Debit Fees Income $1,600; credit Cash $1,600
Answer:
Accounts Receivable $1,600; credit Cash $1,600
Explanation:
According to the given situation, the Journal entry is shown below:-
Accounts Receivable Dr, $1,600
To Cash $1,600
(Being accounts receivable is recorded)
To record the accounts receivable we debited the accounts receivable and we credited the cash to correct the error.
Jaxon Furnishings Company is considering logging opportunities in Alaska to obtain wood for their products. The market analysis team is busy comparing the benefits of increased wood production to the costs of deforestation and resulting environmental conditions. The company is using the _____ approach to make this ethical decision.
Answer:
Jaxon Furnishings Company Vs Logging Opportunities in Alaska
Comparison of the benefits of increased wood production to the costs of deforestation:
The company is using the __environmental sustainability___ approach to make this ethical decision.
Explanation:
According to brittanica.com, environmental "sustainability is understood as a form of intergenerational ethics in which the environmental and economic actions taken by present persons do not diminish the opportunities of future persons to enjoy similar levels of wealth, utility, or welfare."
An approach to an ethical decision is sustainable when it considers the long-term benefits and costs associated with the decision, instead of concentrating on the short-term benefits as some business transactions are done. Short-termism selfishly considers the immediate gains from a transaction. It lacks a futuristic appetite for the good of future generations.
Kenzi kayaking a manufacturer of kayaks began operations this year. During this first year the company produced 1075 kayaks and sold 825 at a price of $1075 each. At this first year-end, the company reported the following income statement information using absorption costing.
Sales (825x $1,075) Cost of goods sold (825x $475) Gross margin Selling and administrative expenses Net income
$886,875 391,875 495,000 210,000 $285,000
Additional Information:
a. Product cost per kayak totals $500, which consists of $400 in variable cost production cost and $100 in fixed production cost- the latter amount is based on 107500 of fixed production cost allocated to the 1075 kayaks produced.
b. The $210,000 in selling and administrative expense consists of $75,000 that is variable and $135,000 that is fixed.
Required:
Prepare an income statement for the current year under variable costing.
Answer:
Income Statement for the Current Year under Variable Costing
Sales (825 × $1,075) $886,875
Less Cost of Sales
Opening Stock $0
Add Cost of Goods Manufactured ( 1075 × $400) $430,000
Less Closing Inventory (250 × $400) ($100,000) ($330,000)
Contribution $556,875
Less Expenses :
Fixed Manufacturing Overheads ($107,500)
Selling and administrative expense : Variable ($75,000)
Selling and administrative expense : Fixed ($135,000)
Net Income / (Loss) $239,375
Explanation:
Under variable costing, only variable costs of production are included in cost of goods sold. Both the Non - Production and Fixed Production Costs are treated as Period Cost Expensed during the year.
The following data were taken from the records of Clarkson Company for the fiscal year ended June 30, 2017.Raw Materials Inventory 7/1/16 $51,100Factory Insurance $4,700Raw Materials Inventory 6/30/17 46,000Factory Machinery Depreciation 19,000Finished Goods Inventory 7/1/16 98,200Factory Utilities 29,100Finished Goods Inventory 6/30/17 26,100Office Utilities Expense 9,350Work in Process Inventory 7/1/16 26,800Sales Revenue 564,000Work in Process Inventory 6/30/17 22,300Sales Discounts 4,700Direct Labor 147,750Plant Manager’s Salary 65,600Indirect Labor 26,560Factory Property Taxes 9,810Accounts Receivable 27,100Factory Repairs 1,600Raw Materials Purchases 97,500Cash 35,600A) Prepare a cost of goods manufactured schedule (Assume all raw materials used were direct materials).B) Prepare an income statement through gross profitC) Prepare the current assets section of the balance sheet at June 30,2017
Answer:
A) cost of goods manufactured schedule
Factory Insurance 4,700
Factory Utilities 29,100
Factory Machinery Depreciation 19,000
Direct Labor 147,750
Plant Manager`s Salary 65,600
Indirect Labor 26,560
Factory Property Taxes 9,810
Factory Repairs 1,600
Add Beginning Work in Process Inventory 26,800
Less Closing Work in Process Inventory (22,300)
Cost of Goods Manufactured $308,620
B) income statement through gross profit
Sales Revenue 564,000
Less Sales Discounts (4,700)
Net Sales 559,300
Less Cost of Goods Sold :
Finished Goods Inventory 98,200
Add Cost of Goods Manufactured 308,620
Less Closing Finished Goods Inventory (26,100) (380,720)
Gross Profit 178,580
C) current assets section of the balance sheet at June 30,2017
Current Assets
Raw Materials Inventory 46,000
Work in Process Inventory 22,300
Finished Goods Inventory 26,100
Accounts Receivable 27,100
Cash 35,600
Total Current Assets 157,100
Explanation:
Raw Materials Consumed in Production Calculation
Open a Raw Materials T - Account as follows :
Debit :
Opening Balance $51,100
Purchases $97,500
Totals $148,600
Credit :
Closing Balance $46,000
Requisitioned for Production (Balancing figure) $102,600
Totals $148,600
According to Scott, the chief operating officer of Barcelona Restaurant Group, the only way a business can ensure to have enthusiastic, nice, fun employees is by: a.paying them higher salaries than the industry standards. b.appraising the employees regularly. c.hiring people who possess these qualities. d.training the employees to acquire these qualities. According to Scott, the chief operating officer of the Barcelona Restaurant Group, his company is always hiring because: a.people constantly move in the restaurant business. b.it wants to reduce cost by replacing high-salaried employees with low-salaried employees. c.it hires employees only for short term. d.it wants to improve performance by creating job insecurity among its employees.
Answer: Hiring people who possess these qualities.
People constantly move in the restaurant business.
Explanation:
According to Scott, the chief operating officer of Barcelona Restaurant Group, the only way a business can ensure to have enthusiastic, nice, fun employees is by hiring people who possess these qualities. When an employee is nice, enthusiastic and fun to be with, this kind of employee will bring his characters along in whatever he do in the organization and it will be easier to relate with customers than someone who has the opposite of the characters mentioned.
According to Scott, the chief operating officer of the Barcelona Restaurant Group, his company is always hiring because people come and go in the restaurant business. Employees don't usually stay for a long time and.he also believes he has the legitimate power to fore any employee.
- Hiring Those people who possess these qualities,
-Although People constantly move in the restaurant business.
Part-A and B The correct option is C and A
What is Enthusiastic?According to Scott, the chief working officer of Barcelona Restaurant Group, the greatest way a business can ensure to have enthusiastic, nice, entertaining employees is by hiring people who maintain these qualities. When an employee is nice, enthusiastic, and a joy to be with, this kind of employee will bring his qualities along in whatever he does in the organization and it will be more comfortable to relate with consumers than somebody who has the opposite of the characteristics mentioned.
According to Scott, the chief working officer of the Barcelona Restaurant Group, his company is always hiring because people arrive and go in the lunchroom business. Employees don't usually stay for a prolonged time. he also believes he has the honest power to fore any employee.
Therefore, the correct option is 'A' and 'C
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Marketing research traditionally has been associated with manufacturers of consumer goods. Today, an increasing number of organizations, both profit and nonprofit, are using marketing research. Why do you think this trend exists? Give some examples.
Answer:
In modern times, Marketing research focuses mainly on knowing how people work and translating knowledge into new process creation. Market analysis plays a role in promoting the information exchange as it enables facilitate the exchange by collecting data and collecting market intelligence. Critical marketing strategy is also absorbed in the process of transformation where it is known as auction Point Data.
The marketing research trend appears to exist across both non - for - profit as well as for-profit organisations as the important information gathered in market analysis involves the procedure of return as it impacts the sum of money that is usually transferred by customers.
Which of the following is not a consequence of minimum wage laws? A) Some workers benefit when the minimum wage is increased. B) Employers will be reluctant to offer low-skill workers jobs with training. C) Low skilled workers are hurt because minimum wage reduces the number of jobs providing low skilled workers with training. D) Producers have an incentive to offer workers non-wage benefits such as health care benefits and convenient working hours rather than a higher wage.
Answer:
D) Producers have an incentive to offer workers non-wage benefits such as health care benefits and convenient working hours rather than a higher wage.
Explanation:
Minimum wage law according to all countries of the world is a law type that governs work force of the country and states naturally of employer not hiring workers for less than the given working hours and also gives protection in different forms which include the employee rights and benefits in any situation not withstanding what befalls the said employer or company.
Base pay rate also is been considered as fair pay for the work done. Also, minimum wage protects employees from any form of alterations in every bend of the economy.
The meaning of saving and investment Classify each of the following based on the macroeconomic definitions of saving and investment. Saving Investment Kate purchases stock in Pherk, a pharmaceutical company.
Hubert purchases a new condominium in Houston.
Clancy purchases a certificate of deposit at his bank.
Eileen borrows money to build a new lab for her engineering firm."
Answer:
Kate purchases stock in Pherk, a pharmaceutical company.
SAVINGSHubert purchases a new condominium in Houston.
INVESTMENTClancy purchases a certificate of deposit at his bank.
SAVINGSEileen borrows money to build a new lab for her engineering firm.
INVESTMENTIn macroeconomics, investment refers to the goods that we purchase not to be consumed right away, but instead will be used to produce more goods or create wealth in the future. E.g. purchase of equipment, new homes by private consumers, additional inventories, etc.
Savings refers to the money that households have left after paying all their taxes, debts, obligations and consumption expenses. E.g. savings in banks
On December 31, Lowland, Inc., converts its $900,000 par value bonds (carrying value also $900,000) into 90,000 shares of $6 par value common stock. Complete the necessary journal entry by selecting the account names and dollar amounts from the drop-down menus.
Answer:
Lowland, Inc., entry to record this conversion includes a
Dr Bonds Payable $900,000
Cr Common Stock $540,000
( 90,000 shares x $6 par value per share)
Cr Paid-In Capital in Excess of Par Value $360,000
($900,000 -$540,000)
Explanation:
Since Lowland, Inc. converted its $900,000 par value bonds and carrying value also $900,000) into 90,000 shares of $6 par value common stock which means we have to Debit Bonds Payable with $900,000 and Credit Common Stock with $540,000 which is
( 90,000 shares x $6 par value per share) , then Credit Paid-In Capital in Excess of Par Value for $360,000 which is ( value of bonds converted of $900,000 - par value of shares of common stock issued of $540,000).
The effect is A. more likely if inflation is unanticipated because workers would not seek higher nominal wages. B. more likely if inflation is unanticipated because workers would seek higher nominal wages. C. less likely if inflation is unanticipated because workers would not seek higher nominal wages. D. less likely if inflation is unanticipated because workers would seek higher nominal wages.
Answer:
more likely if inflation is unanticipated because workers would not seek higher nominal wages.
Explanation:
Here is the full question:
The effect of the sudden unanticipated spurt of inflation:
A. less likely if inflation is unanticipated because workers would not seek higher nominal wages.
B. less likely if inflation is unanticipated because workers would seek higher nominal wages.
C. more likely if inflation is unanticipated because workers would seek higher nominal wages.
D. more likely if inflation is unanticipated because workers would not seek higher nominal wages.
Inflation is a presistent rise in general price level.
Workers compensate for expected inflation by asking for an increase in nominal wages.
Nominal wages = real wages + inflation
If there's an unanticipated rise in inflation, workers would be at a disadvantage because their wages would most likely not reflect this unexpected rise in inflation.
I hope my answer helps you
Answer: A. more likely if inflation is unanticipated because workers would not seek higher nominal wages.
Explanation:
An Unanticipated Spurt in Inflation could lead to rapid Economic growth and this effect is more likely if it was unanticipated because workers would not seek higher nominal wages.
This is because if the workers do not expect prices to rise and hence do not negotiate better wages, the cost of Production for producers will remain the same even though profitability has increased due to the higher prices.
The producers will therefore produce more goods to take advantage of the situation which will further aid Economic growth.
Tom Company incurs overhead costs each year in its three main departments, setup ($70,000), machining ($34,000), and packing ($56,000). Information about the company's two products is as follows:
Product A1 Product B1 Total
Number of setups 7 33 40
Machining hours 2,800 2,200 5,000
Orders packed 280 220 500
Number of products manufactured 560 440 1,000
If machining hours are used as a base under traditional costing, how much overhead is assigned to Product A1?
Answer:
Allocated MOH= $89,600
Explanation:
Giving the following information:
Tom Company incurs overhead costs each year in its three main departments, setup ($70,000), machining ($34,000), and packing ($56,000).
Product A1 Product B1 Total
Number of setups 7 33 40
Machining hours 2,800 2,200 5,000
Orders packed 280 220 500
Number of products manufactured 560 440 1,000
Under the traditional costing system, the company applies overhead based on a single plantwide predetermined overhead rate.
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 160,000/ 5,000
Predetermined manufacturing overhead rate= $32 per machine hour
Now, we can apply overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 32*2,800= $89,600
A pollution haven is A. unattractive for multinational investment because of the ambient pollution. B. a location with weak environmental rules that attracts manufacturing companies due to decreased costs. C. a place that has very low worker wages. D. a place where people actually like pollution and view it as a positive externality.
Answer:
B. a location with weak environmental rules that attracts manufacturing companies due to decreased costs.
Explanation:
A pollution haven is when companies establish factories or offices abroad in countries in which they have lower costs and have access to all the resources they need. Also, these locations tend to be in developing nations in which the environmental standards tend to be lower than the ones in developed nations. According to this, the answer is that a pollution haven is a location with weak environmental rules that attracts manufacturing companies due to decreased costs.
The other options are not right because a pollution haven is attractive for multinational investment because of the lower cost and it is not related to ambient pollution. Also, a pollution haven has low wages but it is not the only thing that defines it and it is not a place where people like pollution.
QUESTION 12 For a strategic alliance, firms should seek partners that are: a. known for being opportunistic. b. radically different when it comes to strategic goals. c. willing to share costs and risks of new-product development. d. different in terms of vision and agendas. e. similar when it comes to capabilities.
Answer:
c. willing to share costs and risks of new-product development.
Explanation:
A strategic alliance is when two companies come together to carry out a project that benefits both companies while both companies still retain their independence.
If strategic alliance is carried out with a company that is opportunistic, the company might take advantage of the other company or take certain actions that would not benefit the other company.
strategic alliance has to be mutually beneficial to both companies, so, strategic goals and visions have to align.
Capabilities don't have to be the same for a strategic alliance.
I hope my answer helps you
The Viper retires a $49.4 million bond issue when the carrying value of the bonds is $53.1 million, but the market value of the bonds is $46.5 million. The entry to record the retirement will include: Multiple Choice A debit of $6.6 million to a loss account. No gain or loss on retirement. A credit to cash for $53.1 million. A credit of $6.6 million to a gain account.
Answer:
A debit of $6.6 million to a loss account
Explanation:
The entry to record the retirement Viper retires
Carrying value of the bonds $53.1 million
Less the market value of the bonds is $46.5 million
=$6.6 million loss
The answer is a debit of $6.6 million to a loss account because the carrying value of the bonds was $53.1 million while the market value of the bonds was $46.5 million which means we have to deduct the carrying value from the market value which gave us a loss of $6.6 million .
although appealing to more refined tastes, art as a collectible has not always performed so profitably. assume that in 2015, an auction house sold a statute at auction for a price of $10,479,500. unfortunately for the previous owner, he had purchased it in 2011 at a price of $12,929,500. what was his annual rate of return on this sculpture
Answer:
-5.12%
Explanation:
The annual rate of return can be determined using the future value formula given below:
FV=PV*(1+r)^n
FV is the value of the sculpture in 2015 which is $10,479,500.
PV is the original value of $12,929,500.
n is the number of years the sculpture was owned which is 4 years
r is the unknown
10,479,500=12,929,500*(1+r)^4
10,479,500/12,929,500=(1+r)^4
0.810510847 =(1+r)^4
divide the index on both sides by 4
(0.810510847 )^(1/4)=1+r
0.948832841 =1+r
r=0.948832841 -1
r=-5.12%
Prepare journal entries to record each of the following four separate issuances of stock. A corporation issued 5,000 shares of $20 par value common stock for $120,000 cash. A corporation issued 2,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $28,000. The stock has a $1 per share stated value. A corporation issued 2,500 shares of no-par common stock to its promoters in exchange for their efforts, estimated to be worth $28,000. The stock has no stated value. A corporation issued 1,250 shares of $75 par value preferred stock for $121,750 cash.
Answer and Explanation:
1. Cash Dr, $120,000
To Common Stock $100,000 (5,000 × $20)
To Additional Paid - in - Capital in Excess of Par $20,000
(Being issue of common stock is recorded)
2. Cash Dr, $28,000
To Common Stock Dr, $2,500 (2,500 × $1)
To Additional Paid - in - Capital in Excess of Stated $31,500
(To record issue of common stock to promoters)
3. Organization Expenses Dr, $28,000
To Common Stock Dr, $28,000
(Being issue of common stock in exchange of organization expenses is recorded)
4. Cash Dr, $121,750
To Preferred Stock $93,750 (1,250 × $75)
To Additional Paid - in - Capital in Excess of Par (Preferred) $28,000
(Being issue of Preferred stock is recorded)
You purchase one MMM July 129 call contract (equaling 100 shares) for a premium of $21. You hold the option until the expiration date, when MMM stock sells for $141 per share. You will realize a ______ on the investment.
Answer:
There is loss of $900 on investment.
Explanation:
The purchase of 1 MMM July 129 call contract at premium = $21
Since it is given that it is held unit the expiration date.
The selling price of MMM stock = $141 per share.
Total number of shares = 100
Total amount paid for share (purchase price) = 129 + 21 = $150
Loss or profit = Market price on expiration date- purchase price
=141-150
= - 9
Total loss = 9 × 100
=900 loss
Eberley Corporation's cost formula for its manufacturing overhead is $25,700 per month plus $10 per machine-hour. For the month of July, the company planned for activity of 5,900 machine-hours, but the actual level of activity was 5,920 machine-hours. The actual manufacturing overhead for the month was $86,800. The manufacturing overhead in the planning budget for July would be closest to:
Answer:
$84,700
Explanation:
The computation of manufacturing overhead in the planning budget for July is shown below:-
Manufacturing overhead in the planning budget = Manufacturing overhead per month + Budgeted hours × Budgeted rate
= $25,700 + 5,900 × $10
= $25,700 + $59,000
= $84,700
Therefore for computing the manufacturing overhead in the planning budget for July we simply applied the above formula.
Consider two ways of commuting in a crowded city: taking public transportation, such as subway and buses, or driving your own car.
A person who chooses to take public transportation in a crowded city imposes a NEGATIVE OR POSITIVE externality on drivers. A policy implication of this result is a SUBSIDY FOR OR TAX ON those who take public transportation.
Persons who choose to drive their own cars to get around in a crowded city impose a NEGATIVE OR POSITIVE externality on other drivers. A policy implication of this result is a TAX ON OR SUBSIDY FOR those who drive their own cars.
Answer: positive; subsidy for; negative; tax on.
Explanation:
A positive externality occurs when the activities of an economic agent is of benefit to another third party that is not part of the activity or transaction while negative externality is the cost an individual bears due to the market activities of another individual or firm. It should be noted that the third parties didn't plan to incur the costs or benefits mentioned above.
Therefore, an individual who chooses to take public transportation in a crowded city imposes a positive externality on drivers. We are told that the city is overcrowded, therefore using public transportation means there will be lesser vehicles on the road and this will be beneficial to the drivers and there may be subsidy for those who take public transportation.
The people who choose to drive their own cars to get around in a crowded city impose a negative externality because there will be traffic congestion and health hazards and a tax can be imposed on them.
Alpha and Beta are partners who share income in the ratio of 1:2 and have capital balances of $42,600 and $88,200, respectively, at the time they decide to terminate the partnership. After all noncash assets are sold and all liabilities are paid, there is a cash balance of $77,700. What amount of loss on realization should be allocated to Alpha
Answer:
The amount of loss to Alpha is $17700.
Explanation:
Given income sharing ratio = 1:2
The capital balance of Alpha = $42600
The capital balance of Beta = $88200
Total capital balance (Alpha + Beta) [tex]= $42600 + $88200 = $130800[/tex]
The cash balance available = $77700
Loss = 130800 – 77700 = $ 53100
The share of loss allocated to Alpha:
[tex]= 53100 \times \frac{1}{3} \\= $17700[/tex]
Therefore, the amount of loss to Alpha is $17700.
The money supply represents the amount of money the Federal Reserve Bank makes available for people to buy goods a
True or false
Answer:
True
Explanation:
The federal reserve ensures that the bank has enough money by the end of the night in case anyone needs money so that the market crash problem in the 1920s won’t happen again
An uninterruptible power system used in a small production facility at Acme Manufacturing has a basis of $56,000 and is expected to have $5750 salvage value after 125,000 hours of use. Calculate the depreciation rate per hour of use and the book value after 77,000 hours of operation.
Answer:
The depreciation rate per hour is 0.402
The Book value is $25,046
Explanation:
In order to calculate the depreciation rate per hour of use we would have to calculate the following:
depreciation rate per hour=(basis- salvage value)/hours of use
depreciation rate per hour=($56,000-$5750)/125,000
depreciation rate per hour=0.402
To calculate the book value we would have to make the following calculation:
Book value=basis-(depreciation rate per hour*77,000 hours of operation)
Book value=$56,000-(0.402*77,000)
Book value=$25,046
Ballard Company uses the perpetual inventory system. The company purchased $9,800 of merchandise from Andes Company under the terms 2/10, net/30. Ballard paid for the merchandise within 10 days and also paid $430 freight to obtain the goods under terms FOB shipping point. All of the merchandise purchased was sold for $18,600 cash. What is the gross margin that resulted from these transactions
Answer:
$8,566
Explanation:
The computation of the gross margin is shown below:
Purchase of inventory $9,800
Less: Purchase discount ($9,800 × 2%) ($196)
Add: Freight paid $430
Total purchase made $10,034
Sales $18,600
Gross margin ($18,600 - $10,034) $8,566
We simply deduct the sales from the total purchase so that the gross margin amount could come
Which of the following could be considered a cost driver? Select one: a. A service provided by an architecture firm b. A product produced by a manufacturer c. A tax return prepared by a local CPA firm d. All of the above
Answer: d. All of the above
Explanation:
A cost driver refers to the activity that causes an actual change in the cost of a transaction and by extension it's local cost.
For example, cost driver of labor would be the number of people working or cost driver of Electricity paid would be the actual number of units consumed.
In the above, the products and services mentioned are the integral activities for those firms so they are cost drivers to those firms.
Production estimates for August are as follows:
Estimated inventory (units), August 1 12,000
Desired inventory (units), August 31 2,000
Expected sales volume (units), August 75,000
For each unit produced, the direct materials requirements are as follows:
Direct material A ($5 per pound) 3Ibs
Direct material B ($15 per pound) 1/2 Ib
The number of pounds of matierials A and B required for August production are_____. The total direct materials purchases of materials A and B required for August production is:______.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Production:
Estimated inventory (units), August 1 12,000
Desired inventory (units), August 31 2,000
Expected sales volume (units), August 75,000
For each unit produced, the direct materials requirements are as follows:
Direct material A ($5 per pound) 3Ibs
Direct material B ($15 per pound) 1/2 Ib
First, we need to determine the number of pounds required.
Production= sales + desired ending inventory - beginning inventory
Production= 75,000 + 2,000 - 12,000= 65,000 units
Purchases in pounds:
Direct material A= 65,000*3= 195,000
Direct material B= 65,000*0.5= 32,500
Total pounds= 227,500
Now, the cost of direct material:
Direct material cost:
Direct material A= 195,000*5= $975,000
Direct material B= 32,500*15= $487,500
Total= $1,462,500