Answer: A 9-year T-bond with a 10.25% coupon
Explanation:
Generally the higher the coupon rate, the higher the price of the bond. This is because the price of a bond is simply the present value of all the expected Cashflow from the bond. If the bond has a higher coupon rate that would mean that more cash will be paid by the bond thereby increasing it's price.
In short, coupon rates and bond prices have a direct relationship.
Cool Sky reports the following costing data on its product for its first year of operations.
During this first year, the company produced 42,000 units and sold 34,000 units at a price of $120 per unit.
Manufacturing costs
Direct materials per unit $48
Direct labor per unit $18
Variable overhead per unit $6
Fixed overhead for the year $420,000
Selling and administrative cost
Variable selling and administrative cost per unit $12
Fixed selling and administrative cost per year $110,000
1a. Assume the company uses absorption costing. Determine its product cost per unit.
Per unit product cost using: Absorption costing
Cost per unit
1b. Assume the company uses absorption costing. Prepare its income statement for the year under absorption costing.
COOL SKY
Absorption Costing Income Statement
Net income (loss)
2a. Assume the company uses variable costing. Determine its product cost per unit.
Per unit product cost using: Variable costing
Cost per unit
2b. Assume the company uses variable costing. Prepare its income statement for the year under variable costing.
COOL SKY
Variable Costing Income Statement
Net income (loss)
Answer:
Cook Sky
1a. Per unit product cost using, Absorption costing :
Cost per unit
Manufacturing Costs:
Direct materials $48
Direct labor $18
Variable overhead $6
Fixed overhead $10 ($420,000/42,000)
Product cost per unit $82
1b. COOL SKY
Absorption Costing Income Statement
Sales $4,080,000 (34,000 x $120)
Cost of goods sold $2,788,000 (34,000 x $82)
Gross profit $1,292,000
Other Expenses:
Variable selling & admin.($408,000) (34,000 x $12)
Fixed selling & admin. ($110,000)
Net income (loss) $774,000
2a. Per unit product cost using, Variable costing :
Cost per unit
Manufacturing Costs:
Direct materials $48
Direct labor $18
Variable overhead $6
Product cost per unit $72
2b. COOL SKY
Variable Costing Income Statement
Sales $4,080,000 (34,000 x $120)
Cost of goods sold $2,448,000 (34,000 x $72)
Contribution $1,632,000
Other Expenses:
Manufacturing overhead ($420,000)
Variable selling & admin. ($408,000)
Fixed selling & admin. ($110,000)
Net income (loss) $694,000
Explanation:
a) Absorption costing includes all costs, including fixed costs, related to production. This implies that the cost of a finished product includes the following costs: direct materials, direct labor, variable and fixed manufacturing overhead.
b) Variable costing includes only the variable costs directly incurred in production. The cost of a finished product, therefore, includes the following costs: direct materials, direct labor, and variable manufacturing overhead.
The difference in the two is the inclusion of fixed manufacturing overhead in the absorption costing technique in order to arrive at the product cost. Whereas, in variable costing, the fixed manufacturing overhead is regarded as a period cost and not a product cost.
Another difference is that with absorption costing, you arrive at the gross profit from which period costs are deducted to obtain the net income (loss). With variable costing, you arrive at the contribution from which expenses are deducted to get the net income (loss).
your coin collection contains 56 1952 silver dollars. if your grandparents purchased them for their face value when they were new, how much will your collection be worth when you retire in 2056, assuming they appreciate at an annual rate of 6.3 percent
Answer: $32184.54
Explanation:
For us to calculate this , we will use the formula for the future value which has been solved and attached. It should.be noted that:
Present value(PV) = $56
r = rate = 6.3% = 6.3/100 = 0.063
n = time = 2056 - 1952 = 104
The question has been solved and the answer is $32184.54
When they retire in 2056, the collection will be worth $32184.54
Vest Industries manufactures 40,000 components per year. The manufacturing cost of the components was determined as follows: Direct materials $ 75,000 Direct labor 120,000 Variable overhead 45,000 Fixed overhead 60,000 Total $300,000 An outside supplier has offered to sell the component for $12.75. Fixed cost will remain the same if the component is purchased from an outside supplier. Vest Industries can rent its unused manufacturing facilities for $45,000 if it purchases the component from the outside supplier. What is the effect on income if Vest purchases the component from the outside supplier
Answer:
If the company buys the component, income will decrease by $225,000.
Explanation:
Giving the following information:
Units= 40,000
The manufacturing cost:
Direct materials $ 75,000
Direct labor 120,000
Variable overhead 45,000
An outside supplier has offered to sell the component for $12.75.
Vest Industries can rent its unused manufacturing facilities for $45,000.
We will take into account only the differential costs.
Make in -house:
Total cost= 75,000 + 120,000 + 45,000= $240,000
Buy:
Total cost= 40,000*12.75 - 45,000= $465,000
If the company buys the component, income will decrease by $225,000.
Lucy has just finished washing her car and is now checking its oil level. The oil dipstick shows her car’s oil is below the "Low" line. Lucy’s car must have more oil to operate well. What phase of the consumer decision-making process did Lucy just experience?
Answer:
recognition phase
Explanation:
There are 5 phases in the consumer decision-making process:
recognition: the customer realizes that he/she has an unsatisfied need or problem that must be satisfied or solved. In this case, Lucy realized that her car needs more oil and she has to purchase some. information search evaluations of alternatives purchase evaluation of decisionBlossom Company purchased machinery with a list price of $80000. They were given a 5% discount by the manufacturer. They paid $400 for shipping and sales tax of $4000. Blossom estimates that the machinery will have a useful life of 10 years and a residual value of $25000. If Blossom uses straight-line depreciation, annual depreciation will be
Answer:
$5,540
Explanation:
Calculation of Blossom annual depreciation using the straight-line depreciation
Annual depreciation=[List price-discount] + shipping + sales tax - residual value) ÷ 10 years
Let plug in the above formula
Annual depreciation =[($80000-$4,000)+($400+$4,000-$25,000)÷10 years ]
Annual depreciation =$76,000+$400+$4,000-$25,000÷10 years
=$55,400÷10 years
Annual depreciation =$5,540
Calculation for list price discount
5%×80,000
=$4,000
Therefore Blossom annual depreciation using the straight-line depreciation would be $5,540
A company manufactures specialty pollution-sensing devices for the offshore oil industry. One particular device has reached maturity, and the company is considering whether to replace it with a newer model. Technologies have not changed dramatically, so the new device would have similar functionality to the existing one, but would be smaller and lighter in weight. The firm's three choices are: (1) keep the old model, (2) design a replacement device with internal resources, (3) and purchase a new design from a firm that is one of its suppliers. The market for these devices will be either "receptive" or "neutral" of the replacement model. The financial estimates are as follows: Keeping the old design will yield a profit of $6 million dollars. Designing the replacement internally will yield $10 million if the market is "receptive," but a $3 million loss if the market is "neutral." Acquiring the new design from the supplier will profit $4 million under "receptive," $1 million under "neutral." The company feels that the market has a 70 percent chance of being "receptive" and a 30 percent chance of being "neutral." Draw the appropriate decision tree. Calculate expected value for all courses of action. What action yields the highest expected value?
Answer:
designing a replacement with internal resources yields the highest expected value = $6,100,000
Explanation:
expected values:
keep the old model
expected profits = $6,000,000
design a replacement with internal resources
receptive market = $10,000,000 x 0.7 = $7,000,000
neutral market = -$3,000,000 x 0.3 = -$900,000
total expected value = $6,100,000
purchase new design
receptive market = $4,000,000 x 0.7 = $2,800,000
neutral market = $1,000,000 x 0.3 = $300,000
total expected value = $3,100,000
there is no room here to draw a proper decision tree, but it would be something like this:
⇒ keep old model ⇒ $6,000,000 in profits
sensing device ⇒ design a replacement ⇒ receptive market
$7,000,000
⇒ neutral market
-$900,000
continuing from above ⇒ expected value
$6,100,000
⇒ outside supplier ⇒ receptive market
$2,800,000
⇒ neutral market
$300,000
continuing from above ⇒ expected value
$3,100,000
It is the employees duty to: obey his or her employer's lawful orders concerning the employment. create an environment free of competition. be careful and less competent than his or her colleagues. provide a safe and sanitary place to work.
Answer:
obey his or her employer's lawful orders concerning the employment.
Explanation:
As there are several duties owed by employers to their employees, so do we have duties that must be performed by employees to their employers. Example of such duty is employee must obey his or her employer's lawful orders concerning the employment terms.
Other duties or obligations included in the employment terms that must be carried out by an employee are; serve faithfully, account for all money or property received, cooperate with the employer, perform duties with proper care and diligence , otherwise may be sued the employer . There are also duties owed by an employee to an employer even though such are not mentioned in the contract terms, i.e duty to be honest, to do what is deemed reasonable by an employee in any situation, not to disclose employer's confidential information etc.
Wilson has a 40 percent interest in the assets and income of the CC&W Partnership, and the basis in his partnership interest is $45,000 at the beginning of 2014. During 2014, the partnership's net loss is $60,000 and Wilson's share of the loss is $24,000. Also, Wilson receives a cash distribution from the partnership of $12,000 on June 30, 2014.
a. Indicate the amount of income or loss from the partnership that should be reported by Wilson on his 2014 individual income tax return.
b. Calculate Wilson's basis in his partnership interest at the end of 2014.
Answer and Explanation:
a. A partner can report his share of the loss of partnership on his personal income tax return to the base limit during his or her partnership interest.
Its partnership interest is based on $45,000 and its share of loss of the partnership is $24,000
So W can report all of the $24,000 partnership loss on his personal income tax return.
b. W's partnership loss reported on his income tax return, and the cash distributed by the partnership to him will reduce his partnership interest base.
Now,
W's basis in his partnership interest at the end of 2014 is
= W's basis in his partnership interest - Partnership loss reported by W on his income tax return - Cash distributed to W by the partnership
= $45,000 - $24,000 - $12,000
= $9,000
If the government removes a binding price floor from a market, then the price received by sellers will Group of answer choices decrease, and the quantity sold in the market will decrease decrease, and the quantity sold in the market will increase increase, and the quantity sold in the market will decrease. increase, and the quantity sold in the market will increase.
Answer:
decrease, and the quantity sold in the market will decrease decrease,
Explanation:
Price floor is set by the government or an agency of the government and it is the minimum price that a good or service must be sold.
A price floor is binding if it is set above equilibrium price.
If a binding price floor is removed, price would fall back towards equilibrium and the quantity sold would decrease.
The fall in quantity supplied is in line with the law of supply which says the higher the price, the higher the quantity supplied and the lower the price , the lower the quantity supplied.
I hope my answer helps you
Paul Inc. forecasts a capital budget of $725,000. The CFO wants to maintain a target capital structure of 45% debt and 55% equity, and it also wants to pay dividends of $500,000. If the company follows the residual dividend policy, how much income must it earn, and what will its dividend payout ratio be?
Answer:
If the company follows the residual dividend policy, the income he must earn is $898,750
The dividend payout ratio will be 55.63%
Explanation:
In order to calculate the income must it earn we would have to make the following calculation:
income must it earn=55% equity+dividends
55% equity=$725,000*0.55
55% equity=$398,750
Therefore, income must it earn=$398,750+$500,000
income must it earn=$898,750
If the company follows the residual dividend policy, the income he must earn is $898,750.
To calculate the dividend payout ratio we would have to calculate the following formula:
dividend payout ratio=dividends paid/income must it earn
dividend payout ratio=$500,000/ $898,750
dividend payout ratio=55.63%
The dividend payout ratio will be 55.63%
An investor wishes to buy a new issue of U.S. Government agency bonds. You recommend that the customer purchase Federal Home Loan Bank bonds with a 20 year maturity. The new issue of Federal Home Loan Bank Bonds will be sold:
Answer: a par
Explanation:
From the question, we are informed that an investor wishes to buy a new issue of U.S. Government agency bonds and was recommend that the customer purchase Federal Home Loan Bank bonds with a 20 year maturity.
It should be noted that new issues that relate to agency securities are typically sold by a selling group which will be appointed by the agency and such groups are usually made up of broker dealers and large banks.
The group will then sell the issue to the public at par and out of the revenue that is made, a selling concession will be paid by the agency to the selling group.
"On January 1, MM Co. borrows $360,000 cash from a bank and in return signs an 8% installment note for five annual payments of $90,164 each. 1. Prepare the journal entry to record issuance of the note. 2. For the first $90,164 annual payment at December 31, what amount goes toward interest expense
Answer:
1.Jan 01 Dr Cash 360,000
Cr Notes payable 340,000
2.Interest expense 28,800
Principal Reduction 61,364
Explanation:
MM Co.
1 . Journal entry
Since MM Co. borrows $360,000 cash on January 1 from a bank this means we have to
Debit Cash with the amounts of money he borrowed which is $360,000 and Credit Notes Payable with the same amount.
Jan 01 Dr Cash 360,000
Cr Notes payable 340,000
2. Calculation of the amount goes toward interest expense and Principal reduction
Interest expense 28,800
(360,000*8%)
Principal Reduction 61,364
(90,164-28,800)
It is likely that airplane tickets will be increased by 5% each year for the next four years. The cost of the plane ticket to Destination A at the end of the first year is $200. How much money should be placed in a savings account now to have enough money to pay for one travel per year for the next four years
Answer:
The amount to save now is = $862.03 (to 2 decimal places)
Explanation:
In order to solve this, we will compute the end-of-year amounts using the 5% increase each year. This is done as follows:
Year 1 ending = $200
Year 2:
Year 2 beginning price = $200
Note that 5% increase = 5/100 = 0.05
increase in year 2 = 5% of 200 = 0.05 × 200 = 10
Year 2 new price = 200 + 10 = $210
Year 3:
beginning price = $210
increase in year 3 = 0.05 × 210 = $10.5
Year 3 new price = 210 + 10.5 = $220.5
Year 4
beginning price = $220.5
interest in year 4 = 0.05 × 220.5 = 11.025
new price in year 4 = 220.5 + 11.025 = $231.525
Next to calculate the amount needed to pay for one travel ticket per year for the next four years, we will add the prices of the tickets each year as follows:
Total amounts needed = 200 +210 + 220.50 + 231.53 = $862.03
Heidi Luking has discovered that several of the sites she has visited recently downloaded small filesto her computer's hard drive even though she did not request them. The files Heidi discovered areknown as crackers. True or False
Answer:
The correct answer is: False.
Explanation:
On the one hand, the "Crackers" is the name that the people with a huge knowledge in cyber security and therefore that they are the ones that mainly focus on explore methods to breach defenses from computers in order to explote the weakness of the computer system so they will be able to have control of the system.
On the other hand, what Heidi discovered is most likely to be a cybervirus that those web pages implanted in their sites in order to breach the system of the person automatically without her knowledge or autorization with the main purpose of just destroying the computer system.
When The files Heidi discovered are known as crackers the correct answer is: False. "Crackers" is the name for the people.
What is Cyber Security?
On the one hand, the "Crackers" is the name for the people with a piece of huge knowledge of cyber security, and thus that they are the ones that primarily focus on exploring methods to breach defenses from computers to explore the weakness of the computer system so they will be able to have control of the system.
In the different writing, what Heidi discovered is considered likely to be a cyber virus that those web pages entrenched in their sites to breach the system of the person automatically without her understanding or authorization with the main objective of exclusively destroying the computer system.
Find more information about Cyber Security here:
https://brainly.com/question/26520949
You and your roommate are eating pizza and have already consumed all but the last slice. Your roommate claims that he is hungrier than you and therefore should get the last slice of pizza. Your roommate has made:___________.A. diamond-water paradox.B. An interpersonal utility comparison.C. A correct statement.D. A marginal error.
Answer:
The correct answer is (B) An interpersonal utility comparison
Explanation:
Solution
Interpersonal utility comparison: refers to the summation of utility functions of different persons determined on the utility functions being comparable with each other; informally, individuals' choices must be evaluated with the same standard.
The ability to produce a social welfare function depends decisively on the ability to contrast utility functions.
In this case your roommate made an Interpersonal utility comparison.
The trial balance for a business at a given point in time typically has much more detailed information than what is depicted on the financial statements. What is the accounting concept that allows for the information from the trial balance to be condensed to what is displayed on the financial statements
Answer:
Going Concern Concept
Explanation:
The Information from a trial balance is usually shown at historic values and not market values. The financial statements also show the amounts in historic not Liquidation / market values.
Thus we say the entity is foreseen to be in operation in future thus it is a going concern. The concept applied therefore is the Going Concern Concept.
Comfy Fit Company manufactures two types of university sweatshirts, the Swoop and the Rufus, with unit contribution margins of $5 and $15, respectively. Regardless of type, each sweatshirt must be fed through a stitching machine to affix the appropriate university logo. The firm leases seven machines that each provides 1,000 hours of machine time per year. Each Swoop sweatshirt requires 6 minutes of machine time, and each Rufus sweatshirt requires 20 minutes of machine time. Assume that a maximum of 40,000 units of each sweatshirt can be sold. Required: 1. What is the contribution margin per hour of machine time for each type of sweatshirt
Answer:
Comfy Fit Company
Contribution margin per hour of machine time:
Contribution margin for 1 hour of machine time will be equal to:
Swoop = $5 x 60/6 = $50 per hour
Rufus = $15 x 60/6 = $150 per hour
Explanation:
If Contribution margin:
Swoop = $5 for 6 minutes' machine time
Rufus = $15 for 6 minutes' machine time
Therefore, contribution margin per hour will be
Contribution x 60/6.
Since 60 minutes make an hour, there will be ten times more contribution for each.
This gives an hourly contribution of $50 ($5 x 10) and $150 ($15 x 10).
When reading a research report on an automobile company, a registered representative's use of fundamental analysis determines that the stock is a good investment. When attempting to determine the best time to execute orders to buy the stock, the registered representative could refer to:
Answer:
Explanation:
In this situation, the registered representative could refer to a chart showing a recent history of the market price of the stock. The chart provides all the price movements of the stock during a certain period of time as well as different time intervals. This allows the individual to point out key levels of support and resistance as well as any trend that may be occurring. These indications allow the individual to make a more educated decision on the best time to execute orders to buy the stock.
A 1000 is deposited into Fund X, which earns an annual effective rate of 6%. At the end of each year, the interest earned plus an additional 100 is withdrawn from the fund. At the end of 10th year, the fund is depleted. The annual withdrawals of interest and principal are deposited in Fund Y, which earns an annual effective rate of 9%. Determine the accumulated value of Fund Y at the end of Year 10.
Answer:
The accumulated value of Fund Y at the end of Year 10 is $2,084.67.
Explanation:
Note: Find attached the excel file for the calculation of the accumulated value of Fund Y at the end of Year 10.
The accumulated value of Fund Y at the end of Year 10 is ending balance in year 10 which is in red color.
Also note the following from the attached excel file:
a) The ending balance of Fund X is 0.00 because Fund Y is depleted after Year 10.
b) The beginning balance of Fund Y and its earned interest are equal to 0.00, because no amount of money is deposite in Fund Y until after Year 1 which is the withdrawal from Fund X.
Cost accounting systems used by manufacturing companies are based on the: Multiple Choice Periodic inventory system. Perpetual inventory system. Finished goods inventories. Weighted average inventories. LIFO inventory system.
Answer:
Perpetual inventory system.
Explanation:
The cost accounting refers to managing the cost of the company so that the company could able to produced their goods at the lowest cost
Now in the case of a manufacturing company, various things can be calculated like - the cost of goods sold, ending work in process, etc
The perpetual inventory system refers to the system in which the inventory is updated on a regular basis while on the other hand periodic inventory system refers to the system in which the company updated their inventory counts in periodic or particular period only
So here the manufacturing company based on perpetual inventory system so that it can trace the cost in an effective manner
Basic bond valuation Complex Systems has an outstanding issue of $1 comma 000-par-value bonds with a 16% coupon interest rate. The issue pays interest annually and has 11 years remaining to its maturity date. a. If bonds of similar risk are currently earning a rate of return of 9%, how much should the Complex Systems bond sell for today? b. Describe the two possible reasons why the rate on similar-risk bonds is below the coupon interest rate on the Complex Systems bond. c. If the required return were at 16% instead of 9%, what would the current value of Complex Systems' bond be? Contrast this finding with your findings in part a and discuss.
Answer:
a. Complex Systems' bond price today = $1,476.36
Explanation:
a. If bonds of similar risk are currently earning a rate of return of 9%, how much should the Complex Systems bond sell for today?
This can be calculated by adding the Present Value of Coupons and the Present Value of Par Value as follows:
Calculation of Present Value of Coupons
The present of coupons is calculated using the formula for calculating the present value of an ordinary annuity as follows:
Present value of coupons = C × [{1 - [1 ÷ (1 + r)]^n} ÷ r] …………………………………. (1)
Where;
C = Annual coupon amount = Par value * Coupon rate = $1,000 * 16% = $160
r = required rate of return or return of similar risk = 9%, or 0.09
n = number of years = 11
Substitute the values into equation (1) to have:
Present value of coupons = $160 × [{1 - [1 ÷ (1 + 0.09)]^11} ÷ 0.09] = $1,088.83
Calculation of Present Par of Value
To calculate this, we use the present value formula as follows:
Present Value of Par Value = Par value / (1 + r)^n
Since Par Value is $1000 and r and n are as already given above, we have:
Present value of Par Value = $1,000 / (1 + 0.09)^11 = $387.53
Therefore, we have:
Complex Systems' bond price today = Present value of coupons + Present value of Par Value = $1,088.83 + $387.53 = $1,476.36
b. Describe the two possible reasons why the rate on similar-risk bonds is below the coupon interest rate on the Complex Systems bond.
The following are the possible two reasons:
1. Interest may vary bust the coupon is fixed. What can cause the interest rate to vary is the bond rating by rating agency. But his will not affect the coupon rate which is fixed. When the rating is high, the interest will be low. But when the rating is low, the interest will be high. This indicates a negative relationship between the rating and the interest rate.
2. The level of demand may also influence the interest rate to change. When the demand is high, the interest will be low. But when the demand is low, the interest will be high. This also indicates a negative relationship between the demand and the interest rate.
c. If the required return were at 16% instead of 9%, what would the current value of Complex Systems' bond be? Contrast this finding with your findings in part a and discuss.
To do this, we simply change he required return to 16% (or 0.16) in part a and proceed as follows:
Present value of coupons at 16% = $160 × [{1 - [1 ÷ (1 + 0.16)]^11} ÷ 0.016] = $804.58
Present value of Par Value at 16% = $1,000 / (1 + 0.16)^11 = $195.42
Complex Systems' bond price today at 16% = $804.58 + $195.42 = $1,000.00
Comparing part c result with part a result shows that if the coupon rate is greater than the required rate of return, the bond is sold at a premium. That is, price of bond will be more than par. As it can be seen in part a, the price of bond is $1,476.36 when the coupon rate of 16% is greater than the required return of 9%.
Also, the bond will be sold at par when the coupon rate and require return are equal. This is shown in part c where the bond is sold at $1,000 when both coupon rate and required return rate are equal to 16%.
By implication, we can also infer without doing any calculation that the bond will be sold at a discount if the coupon rate is less than the required rate of return.
Crisp Cookware's common stock is expected t opay a dividend of $1.50 a share at the end of this year; its beta is 0.6. The risk free rate is 5.6% and the market risk premium is 4%. The dividend is expected to grow at some constant rate and the stock currently sells for $50 a share. Asuming the market is in equilibrium, what does the market believe will be the stock price at the end of 3 years
Answer: $57
Explanation:
The following can be deduced from the question:
The risk free rate = 5.6%
The market risk premium = 4%
The stick beta = 0.6
The required return will be:
= Risk free rate + (Beta × Market risk premium)
= 5.6% + (0.6 × 4%)
= 5.6% + 2.4%
= 8% = 0.08
Crisp Cookware's common stock is expected to pay a dividend of $1.50 a share at the end of this year, Therefore,
D1 = $1.50
The current stock price will now be:
= D1/(Required return - Growth rate)
50= 1.5/(0.08 - growth rate)
(0.08 - growth rate) = 1.5/50
(0.08 - growth rate) = 0.03
Growth rate = 0.08 - 0.03
Growth rate = 0.05 = 5%
D4 = D1 × (1+Growth rate)³
D4 = 1.5 × (1 + 0.05)³
D4 = 1.5 × (1.05)³
D4 = 1.5 × 1.1576
D4 = $1.7364
The stock price at the end of the year 3
will be:
= D4/(Required return - Growth rate)
= 1.7364/(0.08 - 0.05)
= 1.7364/0.03
= $57
The market believe that the stock price at the end of 3 years will be $57
Massage Envy offers massage services on a subscription basis, so it targets consumers that desire to get multiple treatments per month. Massage Envy likely segments its market by
Answer:
C. usage rate.
Explanation:
As in the question, it is mentioned that Massage Envy offers massage services based on a subscription basis with a view to targeting the consumers that they get more or multiple treatments per month
So Massage Envy target the market segment via usage rate as it depicts the average sales per day so that they get to know how much they earned the revenue by offering multiple treatments to clients
hence, the correct option is C. usage rate
transtutors Cash received from customers includes all $139,000 of the accounts receivable that were outstanding at November 30, 2017. Accounts receivable at December 31, 2017 totaled $141,000. Accounts payable (to suppliers of inventory) decreased by $19,000 from November 30, 2017 to December 31, 2017. The balance in the inventory account decreased by $39,000 over the same period. Required: What is gross profit for the month of December under accrual accounting
Answer:
Gross profit from the month of December is $238000
Explanation:
Question is incomplete but the missing part is:
Cash received from customer during december 2017 - 387,000
Cash paid to supplier for inventory during december 2017 - 131,000
Accrual basis revenues
Particulars Amount $
Cash received from customer 387000
during December 2017
Cash received in December for -139000
November accounts receivable
December sales made on account 141000
collected in January
Accrual basis revenues 389000
Accrual basis expenses
Particulars Amount $
Cash paid to suppliers for inventory 131000
during December 2017
Payments for inventory purchased -19000
and used in November
Inventory purchased in November 39000
but not used in December
Accrual basis expenses 151000
Gross profit from the month of December= Accrual basis revenues - Accrual basis expenses
Gross profit = 389000 - 151000
Gross profit = $238000
Often, the only maintenance provided by industrial property management is A) upkeep of grounds and exterior of the building. B) cleaning office space. C) cleaning common areas including restrooms and elevators. D) refurbishing the factory floor.
Answer: A) upkeep of grounds and exterior of the building.
Explanation:
An Industrial Property Manager as the title implies refer to overseeing the use and utilization of an Industrial property such as factories, Manufacturing plants and Research and Development centres.
As a manager of such a property, your job is mostly limited to ensuring that the surroundings look neat because the interior of the building falls under the purview of the tenants and they will carry out some type of maintenance in there to ensure that the building is viable for their type of machines.
Gienuine Products Inc. requires a new machine. Two companies have submitted bids, and you have been assigned the task of choosing one of the machines. Cash now analysis indicates the following:
Machine A Machine B Year Cash Flow Cash Flow o $2,000 -$2,000 832 832 832 832 0 2 0 0 4 3,877
What is the internal rate of return for each machine?
Answer:
18% and 24.01%
Explanation:
The computation of the internal rate of return for each machine is shown below:
Let us assume the Internal rate of return be X
And as we know that
The present value of cash inflows = present value of cash outflows
For Machine A
So,
$2,000 = $3877 ÷ 1.0x^4
So X = IRR = 18%
For Machine B
$2,000 = $832 ÷ 1.0x + $832 ÷ 1.0x^2 + $832 ÷ 1.0x^3 + $832 ÷ 1.0x^4
So X = IRR = 24.01%
The purpose of the statement of cost of goods manufactured is to: A. Calculate the cost of goods transferred to finished goods inventory during the period. B. Calculate cost of goods sold. C. Calculate net income. D. Both A and B
Answer:
The correct answer is:
Calculate the cost of goods transferred to finished goods inventory during the period.(A)
Explanation:
Cost of Goods Manufactured (COGM) is the total cost of production for a company, during a period, and it is the total cost incurred in manufacturing goods and transferring goods to finished inventory.
Knowing the cost of goods manufactured is used to make managerial decisions because it tells whether the manufacturing costs is too high or too low relative to the selling price of a good, hence it can be used to adjust some components such as direct labor, direct materials, overhead etc.
Matt and Meg Comer are married and file a joint tax return. They do not have any children. Matt works as a history professor at a local university and earns a salary of $64,700. Meg works part-time at the same university. She earns $34,000 a year. The couple does not itemize deductions. Other than salary, the Comers’ only other source of income is from the disposition of various capital assets (mostly stocks).
a.
a. What is the Comers’ tax liability for 2019 if they report the following capital gains and losses for the year?
Short-term capital gains $ 9,200
Short-term capital losses (2,200) )
Long-term capital gains 15,390
Long-term capital losses (6,390) )
b.
What is the Comers’ tax liability for 2019 if they report the following capital gains and losses for the year?
Short-term capital gains $ 1,500
Short-term capital losses 0
Long-term capital gains 10,500
Long-term capital losses (10,200) )
Answer:
Explanation:
Given that:
Matt and Meg Comer are married, file a joint tax return and do not have any children.
The total salary of Matt and Meg = $64,700 + $34,000 = $98,700
The net short capital gain = Short-term capital gains - Short-term capital losses
The net short capital gain = $9,200 - $2,200 = $7,000
The net Long term capital gains = Long-term capital gains - Long-term capital losses
The net Long term capital gains = $15,390 - $6,390 = $9000
The Adjusted gross income AGI = Total Salary + net short capital gain + net Long term capital gains
The Adjusted gross income AGI = $98,700 + $7,000 + $9000
The Adjusted gross income AGI = $114700
The Taxable income = Adjusted gross income AGI - Standard deduction
The Taxable income = $114700 - $24,400
The Taxable income = $90,300
The net taxable income = Taxable income - less preferentially taxed income
The net taxable income = $90,300 - $9000
The net taxable income = $81,300
For 2019:
Tax Liability = $9086 + ($81,300 - $78,950) × 22%
Tax Liability = $9086 + ($2,350) × 0.22
Tax Liability = $9086 + $517
Tax Liability = $9,603
The long-term capital gain for 2019 = $9,000 × 15% (since it is between 15% - 37% ordinary income tax range, it may be taxed as 15%)
The long-term capital gain for 2019 = $9,000 × 0.15
The long-term capital gain for 2019 = $1350
Therefore; the Comers’ tax liability for 2019 if they report the following capital gains and losses for the year is:
Tax Liability + The long-term capital gain for 2019
= $9,603 + $1350
= $10953
b.
The total salary of Matt and Meg = $64,700 + $34,000 = $98,700
The net short capital gain = Short-term capital gains - Short-term capital losses
The net short capital gain = $1,500 - $0 = $1,500
The net Long term capital gains = Long-term capital gains - Long-term capital losses
The net Long term capital gains = $10,500 - $10,200 = $300
The Adjusted gross income AGI = Total Salary + net short capital gain + net Long term capital gains
The Adjusted gross income AGI = $98,700 + $1,500 + $300
The Adjusted gross income AGI = $100,500
The Taxable income = Adjusted gross income AGI - Standard deduction
The Taxable income = $100500 - $24,400
The Taxable income = $76,100
The net taxable income = Taxable income - less preferentially taxed income
The net taxable income = $76,100 - $300
The net taxable income = $75,800
For 2019:
Tax Liability = $1940 + ($75,800 - $19,400) × 12%
Tax Liability = $1940 + ($56400) × 0.12
Tax Liability = $1940 + $6768
Tax Liability = $8,708
The long-term capital gain for 2019 = $3,190 × 0% (since it is in 10% - 15% ordinary income tax range)
The long-term capital gain for 2019 = $0
Therefore; the Comers’ tax liability for 2019 if they report the following capital gains and losses for the year is:
Tax Liability + The long-term capital gain for 2019
= $8,708 + $0
= $8708
A disgruntled employee of your major competitor mails top-secret information or new product samples to you. Do you begin to do a dance on your desktop or do you immediately mail the information back to your competitor
Question:
A disgruntled employee of your major competitor mails top?secret information or new product samples to you. Do you begin to do a dance on your desktop or do you immediately mail the information back to your competitor? What would you do?
a. Throw the plans or secrets away.
b. Send them to your research department for analysis.
c. Notify your competitor about what is going on.
d. Call the FBI.
Answer:
You are to Call the FBI
Explanation:
In this case, where a disgruntled employee of your major competitor mails top-secret information or new product samples to you, the right decision to make acclrding to your company's code and ethics is to contact the security agencies, which in this case is the Federal Bureau of Investigation (FBI). The Federal Bureau of Investigation would make proper investigations and take proper steps to protect your company so they(your company) won't be accused of stealing information from a competitor in time to come.
This is the best way, both ethically and legally to handle this situation.
Purple Hedgehog Forestry Group has generated earnings of $140,000,000. Its target capital structure consists of 60% equity and 40% debt. It plans to spend $85,000,000 on capital projects over the next year and expects to finance this investment in the same proportion as its capital structure. The company makes distributions in the form of dividends.
What will Purple Hedgehog Forestry's dividend ratio be if it follows a residual distribution policy?
a. 63.40%
b. 47.55%
c. 79.25%
d. 71.33%
Purple Hedgehog Forestry is considering using more equity and less debt in its capital Structure. Which Of these statements best describes how this will affect the firm's annual dividend, assuming that all other factors are held
constant?
a. Purple Hedgehog Forestry will pay a smaller annual dividend if it goes forward with this decision.
b. Purple Hedgehog Forestry's annual dividend will be greater if it goes forward with this decision.
Answer:
1.63.57%
2.a. Purple Hedgehog Forestry will pay a smaller annual dividend if it goes forward with this decision.
Explanation:
1. Calculation of what will Purple Hedgehog Forestry's dividend ratio be if it follows a residual distribution policy
Total the amount of Dividend paid using the residual dividend policy will be:
Total Dividend = Net Income – [Total Capital Budget x Equity Ratio]
Let plug in the formula
= $140,000,000 – [$85,000,000 x 60%]
= $140,000,000 - $51,000,000
= $89,000,000
The Expected Dividend pay-out Ratio for this year will be:
Expected Dividend Pay-out Ratio = [Total Dividend Paid / Net Income] x 100
Let plug in the formula
= [$89,000,000 / $140,000,000] x 100
= 63.57%
Therefore Purple Hedgehog Forestry Group’s dividend payout ratio will be 63.57%”
2.The statements that best describes how this will affect the firm’s annual dividend, assuming that all other factors are held constant will be
Statement-A which state that "Purple Hedgehog Forestry Group will pay a smaller annual dividend if it goes forward with this decision."