An effective annual interest rate (EAR) is the interest rate that is adjusted for compounding over a given period. EAR is the actual rate of interest earned on an investment or paid on a loan after the effects of compounding have been calculated. It is calculated as follows:
[tex]EAR = (1 + r/n)^n - 1[/tex]
where r is the annual interest rate, and n is the number of compounding periods per year.
Bank A offers 4.42% APR, compounded annually.
[tex]EAR = (1 + r/n)^n - 1 = (1 + 0.0442/1)^1 - 1 = 0.0442 = 4.42%[/tex]
Bank B offers 3.5% APR, compounded monthly.
[tex]EAR = (1 + r/n)^n - 1 = (1 + 0.035/12)^12 - 1 ≈ 0.035939 = 3.594%[/tex]
Bank C offers 5.37% APR, compounded semi-annually.
[tex]EAR = (1 + r/n)^n - 1 = (1 + 0.0537/2)^2 - 1 ≈ 0.0553 = 5.53%[/tex]
Bank D offers 4.38% APR, compounded continuously.
[tex]EARD = e^r - 1 = e^(0.0438) - 1 ≈ 0.0449 = 4.49%[/tex]
Bank E offers 3.69% APR, compounded quarterly.
[tex]EARD = (1 + r/n)^n - 1 = (1 + 0.0369/4)^4 - 1 ≈ 0.0377 = 3.77%[/tex]
To maximize our interest income, we need to choose the bank that provides the highest EAR. So, the bank with the highest EAR is bank C, which offers 5.53% EAR. Therefore, we should choose bank C.
To calculate the account balance to maximize our interest income after one year, we need to use the formula:
[tex]A = P(1 + r/n)^(n*t)[/tex]
Where A is the balance, P is the principal, r is the annual interest rate, t is the time in years, and n is the number of times the interest is compounded per year.
Here, P = $3,800, r = 5.37%, n = 2, and t = 1.
[tex]A = 3800(1 + 0.0537/2)^(2*1) ≈ $4,000.48[/tex]
Therefore, our account balance should be approximately $4,000.48 to maximize our interest income.
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Jones walked into a new car lot, pointed to a specific car, and said, "I'll take that one." Sam, the operator of the car lot, explained that there was a certain amount of pre-delivery preparation that had to take place before the car could be delivered, and that it would be ready for the purchaser two days later. It was agreed that the purchase price would be paid at that time. Explain who bears the risk in the meantime, and why.
The answer is the purchaser bears the risk in the meantime, and the explanation is that the risk of loss passes from the seller to the purchaser at the time when the seller delivers the goods to the purchaser.
What is a risk in sales?Risk in sales refers to the possibility of loss or harm occurring from an event. When a good is bought or sold, a risk of loss exists. The risk of loss is the possibility that an item will be destroyed or damaged before the buyer receives it, resulting in a loss to the buyer or seller. In some circumstances, such as when a sales contract specifies otherwise, the risk of loss remains with the seller until the purchaser takes possession of the goods. However, in most situations, the risk of loss transfers to the purchaser as soon as the seller delivers the goods. When Jones walks into the car lot and points out a car, the risk of loss will be transferred to Jones as soon as Sam delivers the vehicle. Therefore, it is the purchaser who bears the risk in the meantime.
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The present value equals the future value when ... Select one: a. interest rate is lower than zero b. none of the above c. interest rate is zero d. interest rate is higher than zero
The present value equals the future value when the interest rate is zero, that is, when there is no discounting. The correct option is c.
Future value is the amount of money that an investment is expected to grow to over time with the effect of compound interest. It is a measure of an investment's earning power.Present value is the worth of a future sum of money or stream of cash flows given a specified rate of return. Present value is calculated by discounting the future value (the expected cash inflows) using an appropriate discount rate.
The discount rate is the cost of capital for the project or investment present value.The relationship between present value and future value depends on the rate of interest and the time period. When the interest rate is zero, the future value equals the present value. When the interest rate is greater than zero, the present value is less than the future value because of the effect of compounding.
When the interest rate is greater than zero, the present value is less than the future value, while when the interest rate is lower than zero, the present value is greater than the future value. The correct option is c.
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Demo Problem 2 Solving T-Account
Candy's Cups manufactures and sells plastic party cups. At the beginning of the period they had 37,000 tons of plastic in direct materials inventory. During the period the firm purchased an additional 45,000 tons of plastic. At the end of the period the firm had 39,000 tons of plastic remaining in inventory. How many tons of plastic were used in production during the period?
According to the question 43,000 tons of plastic were used in production during the period.
To determine the number of tons of plastic used in production during the period, we can use the concept of the T-account.
The formula for calculating the plastic used in production is as follows:
Plastic Used in Production = Beginning Direct Materials Inventory + Purchases - Ending Direct Materials Inventory
Given information:
Beginning Direct Materials Inventory = 37,000 tons
Purchases = 45,000 tons
Ending Direct Materials Inventory = 39,000 tons
Using the formula, we can calculate the plastic used in production:
Plastic Used in Production = 37,000 tons + 45,000 tons - 39,000 tons
Plastic Used in Production = 43,000 tons
Therefore, 43,000 tons of plastic were used in production during the period.
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Banks attempt to screen good credit risks from bad to reduce the incidence of loan defaults. To do this, banks
A) specialize in lending to certain industries or regions.
B) write restrictive covenants into loan contracts.
C) expend resources to acquire accurate credit histories of their potential loan customers. D) do all of the above.
Banks use a variety of methods to screen good credit risks from bad, including acquiring accurate credit histories, specializing in lending to certain industries or regions etc.
Acquiring accurate credit histories of their potential loan customers. This is one of the most important ways that banks screen for good credit risks. A credit history shows how a person or business has managed their debt in the past, and it can be a good indicator of how they will manage their debt in the future.
Specializing in lending to certain industries or regions. Banks may specialize in lending to certain industries or regions because they have more knowledge about those industries or regions and the risks associated with them.
Writing restrictive covenants into loan contracts. Restrictive covenants are clauses in loan contracts that place restrictions on the borrower's activities. Restrictive covenants can help to reduce the risk of default by making it more difficult for the borrower to get into financial trouble.
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The project is to build a miniature Bellagio water fountain attraction for a hotel. This includes a filtered/recycling plumbing system, tiling, concrete, timer, lights, music sensors, and high pressure water spouts. Based on the given scenario, please create a well defined Project Schedule!
Project Schedule:The project schedule includes the essential dates and deadlines for each task required to complete the project on time. The timeline for the miniature Bellagio water fountain attraction project with a filtered/recycling plumbing system, tiling, concrete, timer, lights, music sensors, and high-pressure water spouts is as follows:
Task 1: Site Preparation (4 days)Task 2: Excavation (3 days)Task 3: Concrete Pouring and Setting (10 days)Task 4: Plumbing System Installation (7 days)Task 5: Tiling (5 days)Task 6: High-Pressure Water Spouts Installation (7 days)Task 7: Electrical Wiring and Installation of Timer, Lights, and Music Sensors (6 days)Task 8: Testing and Commissioning (5 days)
Total duration: 47 daysNote that these durations are estimated and are subject to change depending on a variety of factors, including weather conditions, material availability, and unforeseen obstacles.
It's crucial to keep the project schedule up to date throughout the project's lifecycle to ensure that all work is completed on time.
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The first quarter of the year is Owen’s favorite time. Owen Poole is a certified public accountant (CPA) and he loves the tax season. Although he understands that tax reform would be best for everyone if it simplified the process, he is glad that the idea of reform has been just talk. Owen enjoys the challenge of figuring out what deductions clients can take and how to maximize his clients’ tax refunds. Owen sees it as a battle between himself and the internal revenue service. The only thing Owen likes more than the challenge itself is winning! When Owen was earning his degree in accounting he took several electives in other business topics. One of his favorite ones was supply chain management. Owen enjoyed the big picture perspective this course emphasized. Understanding business from a broad perspective is crucial to Owen’s own business because many of his clients are businesses, not individuals. As part of his services, Owen gives advice to his business clients on how to improve their bottom line. He explains to them that he will search out every penny possible in deductions to enhance their bottom line. However, he explains that they can help themselves by implementing more effective and efficient processes within their business. Although Owen isn’t an expert in many of these processes, he understands enough to point his clients in the right direction. Since a significant portion of Owen’s clients are small businesses, often just a few years old, his advice is helpful and very welcomed. Today Owen is meeting with Van Ward. Van’s business has been growing very rap-idly. As Owen reviews Van’s financial statements he notices that Van’s profit has been decreasing slightly despite his company’s growth. Van’s financial statements tell Owen a lot. He knows that there has not been much invested in resource planning systems. Consequently, as Van’s business has grown, so have the inefficiencies. Owen decided that will be the topic for today to help Van understand the need for investment in this area.
Discussion Questions
Put yourself in Owen’s position. What questions would you ask Van to better under-stand his needs concerning resource planning?
Enterprise resource planning software is expensive. As Owen, you know that Van cannot afford to buy and implement a complete ERP system. In your opinion, what two common modules of an ERP system do you believe are the most crucial to any business? Provide a recommendation to Van, justifying your choice of the two modules for his business. How does the investment potentially benefit him?
Currently, Van is using a chase production strategy. Owen believes that this is an inefficient strategy. Do you agree with Owen? If so, what option would you recommend to Van? If you disagree with Owen, explain why Van is on the right track with his strategy.
As Owen, some questions that can be asked to Van to better understand his needs concerning resource planning are:
What is the scale of his business?
What are the areas of his business that are in need of improvement?
What are his goals for the business in the coming years?
What is his budget for resource planning?
What is the expected return on investment for the business after implementing resource planning?
Two common modules of an ERP system that are crucial to any business are:
1. Accounting module: This module helps in keeping track of all financial transactions, generating financial reports, managing accounts receivable and accounts payable, and managing payroll.
2. Inventory management module: This module helps in managing inventory levels, tracking inventory movement, forecasting demand, and managing orders. These two modules are essential for any business as they help in maintaining accurate financial records and managing inventory levels. Van can benefit from implementing these modules by gaining better control over his finances and inventory, reducing errors, and improving efficiency.
Currently, Van is using a chase production strategy, which may not be the most efficient strategy. It is an inefficient strategy because it relies on production being triggered by customer orders. This can lead to overproduction, long lead times, and stockouts. A better option for Van would be to adopt a pull production strategy. This strategy relies on production being triggered by actual demand rather than forecasts. This can help Van to reduce lead times, improve inventory management, and increase efficiency.
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there is a proven path to it enablement, which helps companies maximize their return on it investments. which of the following is not part of the proven path?
The proven path to IT enablement helps companies maximize their return on IT investments. To identify the part that is not included in the proven path, let's first understand what the path entails. The proven path to IT enablement typically includes several key steps:
Assessment: This involves conducting a thorough assessment of the company's current IT infrastructure, and processes.It helps identify strengths, weaknesses, and areas that need improvement. Strategy Development:Based on the assessment, a strategy is developed to align IT with the company's overall business goals and objectives. Investment Planning:Once the strategy is defined, companies need to plan their IT investments accordingly. This involves identifying the technologies required to implement the strategy effectively.
Implementation: This step focuses on executing the strategy and implementing the planned IT investments. It may involve deploying new systems, upgrading existing infrastructure, or reconfiguring processes to align with the IT enablement goals. Monitoring and Evaluation: After the implementation, companies need to continuously monitor and evaluate the effectiveness of the IT enablement efforts.Neglecting this aspect can undermine the effectiveness of the IT investments and hinder the company's ability to maximize their returns.
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(0)
In the example given in class of the mountain bike company competing in a highly competitive environment like a western town in the state of Colorado during the summer where mountain biking is a large competitive industry, services like a well-trained sales staff, high end bikes, and convenience services that make the rental process easy is an example of a _____________ strategy.
focused cost
focused diversified
industry wide cost
industry wide diversified
Based on the example given, the strategy being described is an example of a focused differentiated strategy.
A focused differentiated strategy involves targeting a specific market segment and offering unique and tailored products or services to cater to the specific needs and preferences of that segment. In this case, the mountain bike company is targeting the market of mountain biking enthusiasts in a highly competitive environment. By providing services like a well-trained sales staff, high-end bikes, and convenient rental processes, the company is differentiating itself from competitors and focusing on delivering a superior experience to its target customers.
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When a multinational wants foreign exchange for a limited time, it should use the ____ to avoid risk.
Group of answer choices
currency swap
buy at a premium
forward market
spot market
When a multinational wants foreign exchange for a limited time, it should use the currency swap to avoid risk.
1. Currency Swap: A currency swap is a financial arrangement between two parties where they agree to exchange a specific amount of one currency for an equivalent amount of another currency. In this case, when a multinational requires foreign exchange for a limited time, it can enter into a currency swap agreement to mitigate risk.
2. Risk Mitigation: By utilizing a currency swap, the multinational can effectively manage its exposure to foreign exchange rate fluctuations. The agreement allows the multinational to exchange the needed foreign currency for its domestic currency at an agreed-upon exchange rate.
3. Limited Time Period: Since the multinational requires foreign exchange for a specific duration, a currency swap is suitable as it provides a fixed exchange rate for the duration of the agreement. This eliminates the risk associated with potential currency fluctuations in the spot market or forward market.
4. Avoiding Spot Market and Forward Market Risks: The spot market involves the immediate exchange of currencies at the prevailing exchange rate, which can be subject to volatility.
The forward market allows parties to agree on an exchange rate today for a future date, but it still carries the risk of market fluctuations. By opting for a currency swap, the multinational can bypass these risks and ensure stability in the foreign exchange rate during the required time period.
5. Flexibility and Customization: Currency swap agreements can be tailored to meet the specific needs of the multinational, including the amount of currency exchanged and the duration of the swap. This flexibility adds an extra layer of risk management for the multinational.
In summary, when a multinational corporation needs foreign exchange for a limited time, it should utilize a currency swap to avoid risks associated with spot market volatility and forward market fluctuations.
A currency swap provides stability and certainty by offering a fixed exchange rate for the agreed-upon duration, effectively managing the multinational's exposure to foreign exchange risks.
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In which market will the majority of the tax burden fall on buyers?
The majority of the tax burden falls on buyers in a decentralized or competitive market. In a decentralized or competitive market, the tax burden is primarily borne by buyers or consumers.
In a decentralized or competitive market, the tax burden is primarily borne by buyers or consumers. When a tax is imposed on a product or service, it increases the overall price that buyers have to pay. As a result, the tax is effectively shifted onto the buyers in the form of higher prices.
In such markets, sellers have limited control over pricing due to competition, and they are likely to pass on the tax burden to buyers by increasing the prices of their goods or services. Buyers, therefore, bear the brunt of the tax burden through increased costs for the products they purchase.
It's worth noting that the allocation of the tax burden between buyers and sellers can vary depending on market conditions, the elasticity of demand and supply, and the specific dynamics of the industry. However, in a decentralized or competitive market, buyers typically bear the majority of the tax burden.
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If the balance sheet of a firm indicates that total assets exceed long-term liabilities plus shareholders' equity, then the firm has A) number of shares outstanding. B) current liabilities. C) cash dividends. D) no retained earnings. E) no accumulated depreciation.
If the balance sheet of a firm indicates that total assets exceed long-term liabilities plus shareholders' equity, then the firm has no retained earnings.
This implies that option D) no retained earnings is the correct option.Explanation:In accounting, a balance sheet is a financial statement that lists a company's assets, liabilities, and shareholders' equity at a given time. It provides a snapshot of a company's financial position. The balance sheet equation is Assets = Liabilities + Shareholders' Equity. Therefore, when the total assets of a company are greater than its long-term liabilities plus shareholders' equity, the company does not have any retained earnings. Retained earnings are the company's net income after taxes and dividends, which are not paid out as dividends but are retained for future investment opportunities. Thus, a company with no retained earnings implies that it has already distributed all of its earnings in the form of dividends or is just starting up and has not earned enough to retain any earnings.
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Crisp Cookware's common stock is expected to pay a dividend of $3 a share at the end of this year (D 1
=$3.00); its beta is 0.9. The risk-free rate is 4.7% and the market risk premium is 5%. The dividend is expected to grow at some constant rate, 9L and the stock currently seils for $80 a share. Assuming the market is in equilibrium, what does the market believe will be the stock's price at the end of 3 years (i.e. what is P
^
3
) ? Do not round intermediate caiculations. Round your answer to the nearest cent.
The market believes that the stock's price at the end of 3 years will be $488 (rounded to the nearest cent).
Given data:
Dividend at the end of this year D1 = $3.00
Beta = 0.9
Risk-free rate = 4.7%
Market risk premium = 5%
Constant rate = g
= 9%
Stock's current price = $80 a share
The cost of equity is given by
CAPM = Rf + β(Rm - Rf)
CAPM = 4.7% + 0.9(5%)
CAPM = 9.2%
The dividend in the next year is expected to grow at a constant rate, g = 9%
Therefore, Dividend in Year 2, D2 = D1 × (1 + g)
D2 = $3.00 × (1 + 9%)
D2 = $3.27T
he dividend in Year 3, D3 = D2 × (1 + g)
D3 = $3.27 × (1 + 9%)
D3 = $3.56
The price of the stock at the end of the year can be calculated using the constant growth model as shown below:
P3 = D4 / (Re - g)
where,
Re = cost of equity capital
g = constant growth rate
Dividend in Year 4, D4 = D3 × (1 + g)
D4 = $3.56 × (1 + 9%)
D4 = $3.88
P3 = D4 / (Re - g)
P3 = $3.88 / (9.2% - 9%)
P3 = $488
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assume you are in the 24 percent tax bracket and purchase a 5.80 percent, tax-exempt municipal bond. calculate the taxable equivalent yield for this investment using the formula
The taxable equivalent yield for the tax-exempt municipal bond, assuming a 24% tax bracket, is approximately 7.632%.
To calculate the taxable equivalent yield for a tax-exempt municipal bond, you can use the following formula:
Taxable Equivalent Yield = Tax-Exempt Yield / (1 - Tax Rate)
In this case, the tax-exempt yield is 5.80%, and the tax rate is 24%.
Taxable Equivalent Yield = 5.80% / (1 - 0.24)
First, let's calculate 1 - 0.24:
1 - 0.24 = 0.76
Now, divide the tax-exempt yield by the result:
Taxable Equivalent Yield = 5.80% / 0.76
Taxable Equivalent Yield ≈ 7.632%
Therefore, the taxable equivalent yield for the tax-exempt municipal bond, assuming a 24% tax bracket, is approximately 7.632%.
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If French-based Affiliate A owes U.S.-based affiliate B$1,000 and Affiliate B owes Affiliate A∈2,000 when the exchange rate is $1.50=E1.00. The net payment between A and B should be closest to $2,000 from B to A E2,000 from A to B. $1.000 from B10 A none of the options
The net payment between A and B should be closest to $2,000 from B to A . Correct option is A
The net payment between Affiliate A and B in dollars can be calculated as follows;
$1,000 × (1/1.5) = €666.67;
and
$2,000 ÷ (1/1.5) = €3,000.
Therefore, A owes B $666.67 (€1,000 × (1/1.5)),
and B owes A $3,000 (€2,000 ÷ (1/1.5)).
Thus, the net payment from B to A should be the difference between what B owes A and what A owes B, that is $3,000 − $666.67 = $2,333.33 which is closest to $2,000 from B to A.
Hence the correct option is $2,000 from B to A.
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Explain the disadvantages of the open-outcry system compare to
screen-based system (electronic).
(8 marks)
The open-outcry system and the screen-based system are two methods of conducting trading activities in the financial markets. The open-outcry system is a traditional method of trading that involves traders gathering on a trading floor and shouting out bids and offers to buy and sell securities.
On the other hand, the screen-based system, also known as an electronic trading system, is a modern method of trading that involves the use of computer systems and the internet to connect traders from different locations.
The open-outcry system has a number of disadvantages when compared to the screen-based system. Firstly, the open-outcry system is time-consuming and expensive. Traders have to travel to a trading floor to conduct their trading activities. This requires a lot of time and money, especially for traders who are located far away from the trading floor. Additionally, the open-outcry system requires the hiring of a large number of support staff such as brokers, clerks, and messengers. These additional staff members increase the cost of trading and reduce its efficiency.
Secondly, the open-outcry system is prone to errors and fraud. Traders can easily make mistakes in their bids and offers due to the noise and chaos of the trading floor. This can lead to losses for traders and investors. Additionally, the open-outcry system is susceptible to insider trading, where traders use non-public information to gain an unfair advantage over other traders.
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this type of presentational aid has the capacity to distract audience members from you and your message and is best distributed at the end of the speech.
The type of presentational aid described in the statement is a handout or printed material. Handouts and printed materials, such as slides, documents, or brochures, have the potential to divert the attention of the audience from the speaker and the spoken message.
When audience members are focused on reading or examining the handouts, they may become less engaged with the speaker and miss important verbal cues and nonverbal communication.
To ensure that the audience remains attentive to the speaker and the spoken message, it is generally recommended to distribute handouts at the end of the speech rather than at the beginning or during the presentation. This allows the audience to fully concentrate on the speaker's delivery and the content of the speech without being distracted by the printed materials.
By distributing handouts at the end of the speech, the speaker can ensure that the audience's attention is focused on them during the presentation, and the handouts can serve as supplementary materials for the audience to refer to later for further information or as a recap of the key points discussed.
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which of the following categories includes the abilities to listen, understand, and build relationships with others?
The category that includes the ability to listen, understand, and build relationships with others is interpersonal skills.
Interpersonal skills refer to the abilities and qualities that enable individuals to effectively interact and communicate with others. These skills play a crucial role in establishing and maintaining relationships, collaborating with team members, and fostering positive connections in personal and professional settings. Listening is a fundamental interpersonal skill that involves actively paying attention to others, understanding their messages, and responding appropriately. It demonstrates respect, empathy, and the willingness to understand different perspectives. Understanding, another interpersonal skill, involves the capacity to comprehend and interpret information, emotions, and needs of others accurately. It requires empathy, perspective-taking, and the ability to put oneself in others' shoes.
Building relationships is a key aspect of interpersonal skills, which involves forming connections, establishing rapport, and nurturing positive interactions with individuals or groups. It encompasses elements such as effective communication, trust-building, collaboration, conflict resolution, and the ability to adapt to diverse personalities and cultural backgrounds.
Overall, interpersonal skills are essential for effective communication, relationship building, teamwork, leadership, and overall success in various personal and professional contexts. These skills enable individuals to connect with others, foster understanding, and build harmonious and productive relationships.
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samtech manufacturing purchased land and a building for $4 million. in addition to the purchase price, samtech made the following expenditures in connection with the purchase of the land and building: title insurance $ 16,000 legal fees for drawing the contract 5,000 pro-rated property taxes for the period after acquisition 36,000 state transfer fees 4,000
According to the information we can infer that the total cost of the land and building purchase for Samtech Manufacturing is $4,061,000.
How to calculate the total cost of the land and building purchase?To calculate the total cost of the land and building purchase, we need to add the purchase price to the expenditures made in connection with the purchase:
Purchase price: $4,000,000Title insurance: $16,000Legal fees: $5,000Pro-rated property taxes: $36,000State transfer fees: $4,000Total cost = Purchase price + Title insurance + Legal fees + Pro-rated property taxes + State transfer feesTotal cost = $4,000,000 + $16,000 + $5,000 + $36,000 + $4,000Total cost = $4,061,000According to the above we can conclude that the total cost of the land and building purchase for Samtech Manufacturing is $4,061,000.
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Calculating Contribution Margin and Contribution Margin Ratiod Identilying Break.Even Polnt. Target Profit \{LO 6-1, 6-2] Reaulred: 1. Congieke tho distcente ulie lareret. Compiete this gukstien Ey entering your anmwerd in the tabs below. 4. Cakulate-Sandy Bary's breas-even poirt in units and in sales dollars: 5. Suppose 5 andy Banf wants to earn $75.000 profit this yea. Casculate the number of cances that must be sold to ochieve this target Cemplete this questien by entering yeur answers in the tabs below. 5uppose 5andy Bank seils its canoes for $550 each. Cokdate the confritubon mayin per canse and the conthbution margit Cowpleke thia questian by anterisg your answars in the taks below. E6-5 (Static) Calculating Contribution Margin and Contribution Margin Ratio; Identifying Break-Even Point, Target Profit [LO 6-1, 6-2] Sandy Bank, Inc., makes one model of wooden canoe. Partial information is given below. Required: 1. Complete the following table. 2. Suppose Sandy Bank selts its canoes for $550 eoch. Calculate the contribution margin per canoe and the contribution margin fatio. 3. This year Sandy Bank expects to sell 820 canoes. Prepare a contribution margin income statement for the comparny: 4. Calculate Sandy Bank's break-even point in units and in sales dolars: 5. Suppose Sandy Bank wants to earn $75.000 profit this yene. Calculate the number of canoes that must be sold to achieve this targeti Complete this question by entering your answers in the tabs below. Complete the following table. (Round your answers to 2 decimat piaces.) Complete this question by entering your answers in the tabs below. Complete the following table. (Round your answers to 2 decimai places.) Complete this question by entering your answers in the tabs below. Suppose Sandy Bank sells its canoes for $550 each. Calculate the contributian margin per canoe and the contribution margin ratio. (Round your percentage answer to 2 decimal places. (i.e. 1234 should be entered as 1234%.)) Complete this question by entering your answers in the tabs below. This year 5 andy Bank expects to sell 820 canoes. Prepare a contribution margin income statement for the company. (Round yout intermediate calculations to 2 decimal places.) Complete this question by entering your answers in the tabs below. Calculate Sandy Bank's break-even point in units and in sales dollars. (Round final answers to the nearest whole number.) Complete this question by entering your answers in the tabs below. Suppose Sandy Bank wants to earn $75,000 profit this year. Calculate the number of canoes that must be sold to achieve this target. (Round Unit Contribution Margin to 2 decimal places. Round your answer to the nearest whole number)
Given Information:Sandy Bank, Inc., makes one model of wooden canoe. Partial information is given below.Cost per unit Fixed Cost per Year Selling price per canoe Variable cost per canoe Required:1. Complete the following table.
2. Suppose Sandy Bank sells its canoes for $550 each. Calculate the contribution margin per canoe and the contribution margin ratio.3. This year Sandy Bank expects to sell 820 canoes. Prepare a contribution margin income statement for the company.4. Calculate Sandy Bank's break-even point in units and in sales dollars:
Statement:Calculation of Contribution Margin Income Statement Sales (820 x $550) $451,000 Less: Variable Costs: Variable cost per canoe (820 x $350) $287,000 Contribution Margin $164,000 Less: Fixed Costs: Fixed Cost per Year $128,000 Net Operating Income $36,0003. Calculation of Break-Even Point:Break-Even Point (Units) = Fixed Costs / Unit Contribution MarginBreak-Even Point (Units) = $128,000 / $200Break-Even Point (Units) = 640 unitsBreak-Even Point (Sales Dollars) = Selling Price per Unit × Break-even Point (Units)Break-Even Point (Sales Dollars) = $550 × 640Break-Even Point (Sales Dollars) = $352,0004.
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researchers found that people at the workplace who offer this to others were 10 times more engaged at work and 40 percent more likely to be promoted.
Researchers found that people at the workplace who offer social support to others were 10 times more engaged at work and 40 percent more likely to be promoted. The correct option is B.
Social support in the workplace refers to the emotional, instrumental, and informational assistance provided by colleagues. Having supportive relationships with coworkers can enhance job satisfaction and overall well-being. Social support can help buffer the negative effects of stress, leading to improved mental health and reduced burnout. Supportive relationships foster a positive work environment, promoting effective teamwork and cooperation.
Thus, the ideal selection is option B.
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The complete question might be:
researchers found that people at the workplace who offer this to others were 10 times more engaged at work and 40 percent more likely to be promoted.
A networking
B social support
C interdependence
D grow and change
Which of the following statements regarding IPOs is most accurate? Auction IPOs are the most common type of IPO. At an IPO, a firm returns to the public market to offer more shares. In an auction IPO, the underwriter purchases the entire issue at a small discount and then resells it at the offer price. Many IPOs, especially the larger offerings, are managed by a group of underwriters, called a syndicate. The shares that are sold in the IPO may either be new shares that raise new capital, known as a secondary offering, or existing shares that are sold by current shareholders (as part of their exit strategy), known as a primary offering. The Ontario Teachers' Pension Plan is a pension fund for public school teachers in the province of Ontario. It has a large and diverse portfolio of investments, both in Canada and internationally, and had net assets in December 2012 of $108.5 billion. Which of the following best describes the Ontario Teachers' Pension Plan? a sovereign wealth fund an institutional investor a venture capitalist a family investor an angel investor
The most accurate statement regarding IPOs is that many IPOs, especially larger offerings, are managed by a group of underwriters called a syndicate.
IPOs are commonly managed by underwriting syndicates, which consist of multiple investment banks that help the company go public. These underwriters assist in determining the offering price, marketing the IPO to potential investors, and managing the allocation and distribution of shares. This collaborative approach allows for a broader range of expertise and resources in the IPO process.
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market supply is the:a tabular representation of the relationship between the price of a good, service, or resource and the quantities producers are willing and able to supply is known as the supply
Market supply refers to the total amount of goods and services that producers are willing and able to offer at various prices in a given market or during a specific period.
It's calculated by adding up all of the individual supplies of each supplier. The supply of a commodity is the amount of the good or service that producers are willing and able to sell at various prices, ceteris paribus, over a given period of time. At higher prices, suppliers are more willing to provide more, and at lower prices, they are less willing to provide more.
Producers' willingness to produce is influenced by many factors, including the cost of production, technology, input prices, and government policies. A higher price may cause existing producers to increase production, but it may also encourage new producers to enter the market. On the other hand, a lower price may cause some producers to leave the market, resulting in a decrease in supply. As a result, the supply curve is upward-sloping, indicating that as the price rises, the quantity supplied rises.
In conclusion, the market supply is the total amount of goods and services that producers are willing and able to provide at various prices in a particular market. The supply curve is a graphical representation of the relationship between price and quantity supplied.
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Which of the following correctly matches prior terminology under accounting standards with updoted torminology under Asu 2016−i4? a. Unrestricted net assots are still unrostricted; temporarily and permanently restricted net assats dre now "With donor restrictions" under AsU 20l6-l4. b. Unrestricted net assets are now "Without donor restrictions." Temporarily restricted net assets ote now "with donor restrictions," and permanenthy restricted net assets remain permanently restricted. c. Unrestricted and temporarily restricted net assets are now "without donor restrictions." Permanently restricted nat assets are now "with donoe restrictions." d. Unrestricted not assets are now "without donor restrictions." Temporarily and permanently restrioted net assets are now "with donor restrictions"
As per ASU 2016-14, the updated terminology is as follows:a. Unrestricted net assets are still unrestricted; temporarily and permanently restricted net assets are now "with donor restrictions" under ASU 2016-14.b. Unrestricted net assets are now "without donor restrictions.
" Temporarily restricted net assets are now "with donor restrictions," and permanently restricted net assets remain permanently restricted. c. Unrestricted and temporarily restricted net assets are now "without donor restrictions." Permanently restricted net assets are now "with donor restrictions.
"d. Unrestricted net assets are now "without donor restrictions." Temporarily and permanently restricted net assets are now "with donor restrictions.
"Hence, option b is correct: Unrestricted net assets are now "Without donor restrictions." Temporarily restricted net assets are now "With donor restrictions," and permanently restricted net assets remain permanently restricted.
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Suppose Oppenheimer Bank is offering a 30-year mortgage with an EAR of 5.375%. If you plan to borrow $150,000, what will be your monthly payment?
- Your monthly payment will be $_____
The monthly payment of the Oppenheimer bank would be $828.85.What is EAR?EAR is the effective annual rate, a proportionate rate that incorporates the interest rate that is applied on the principal and the compound interest that accrues on the previous year's interest.
The formula for calculating EAR is given by EAR = (1 + r/m)m - 1, where r is the annual nominal interest rate and m is the number of times interest is compounded annually.Given below are the relevant details:Mortgage amount = $150,000Nominal interest rate = 5.375%Compounding period = MonthlyTerm of the loan = 30 yearsWe need to determine the monthly payment of the mortgage using the above details.The formula to calculate monthly payments is:PV = PMT * [(1 - (1 / (1 + r)n)) / r], where PV is the present value of the mortgage, PMT is the monthly payment, r is the monthly interest rate, and n is the number of monthly payments over the term of the mortgage.Converting nominal rate into monthly rate:Since the compounding period is monthly, we convert the nominal interest rate into the monthly interest rate using the formula: r = (1 + i)1/12 - 1where i = nominal interest rate per annum= 5.375% / 100 = 0.05375r = (1 + 0.05375)1/12 - 1r = 0.00435Calculation of monthly payment using the formula:PV = PMT * [(1 - (1 / (1 + r)n)) / r]Here, PV = $150,000, r = 0.00435, and n = 30 x 12 = 360 yearsPutting the values, we get:150000 = PMT * [(1 - (1 / (1 + 0.00435)360)) / 0.00435]PMT = 150000 / [(1 - (1 / (1.00435)360)) / 0.00435]PMT = $828.85Therefore, the monthly payment will be $828.85.
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Donner Company is selling a plece of land adjacent to its business premises, An appraisal reported the market value of the land to be $218,269. The Focus Company initialy offered to buy the land for $178,411. The companies setbed on a purchase price of $213,307, On the same day, another piece of iand on the same block sold for 3237,908. Under the cost concept, at what amount should the land be recorded in the accounting records of Focus Company? a. 5737,008 b. $218π20 c. 3213,397 d. \$178.411
Donner Company is selling a piece of land adjacent to its business premises. An appraisal reported the market value of the land to be $218,269.
The Focus Company initially offered to buy the land for $178,411.
The companies settled on a purchase price of $213,307. On the same day, another piece of land on the same block sold for 3237,908.
Under the cost concept, the land should be recorded in the accounting records of Focus Company at the amount at which it was purchased, i.e., $213,307.
Although another piece of land on the same block was sold for $237,908 on the same day, that transaction doesn't relate to the cost of the land purchased by the Focus Company.
A cost concept is an accounting concept that is applied to the records of business organizations and assets.
The cost concept establishes that assets should be recorded at the price at which they were purchased.
Any subsequent rise in their value cannot be recorded in the books.
Likewise, if the value of an asset falls, it is not to be written off, as that is not permissible under the cost concept.
Thus, under the cost concept, the amount at which the land should be recorded in the accounting records of Focus Company is $213,307. Option C is the correct answer.
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On 15t January 2021 Hagrid ttd, acquired a castle to install its factory for E1,200,000 on cast. The castle has a useful life of 100 years and 0 residual value. Hagrid Lid. uses the straight-line depreciation method. The accounting year-end for Hagrid Ltd. is 3 ist December. On 30 th April 2022. Hagrid Ltd. sells the castle for £800,000. Which are all the accounting entries related to these economic transactions? d. None of the answers is true.
Since the question asks for the accounting entries, the loss is not explicitly recorded in this scenario.
The accounting entries related to the economic transactions involving Hagrid Ltd.'s acquisition and subsequent sale of a castle are as follows: On January 15, 2021, Hagrid Ltd. would record a debit entry to the Castle asset account for £1,200,000 and a credit entry to the Cash/Bank account for the same amount.
Additionally, a contra-asset account called Accumulated Depreciation - Castle would be created with an initial credit entry of £0. On April 30, 2022, when Hagrid Ltd. sells the castle for £800,000, the following entries would be made: a debit entry to the Cash/Bank account for £800,000
A debit entry to the Accumulated Depreciation - Castle account for the depreciation expense accumulated until the sale date, and a credit entry to the Castle asset account for the original cost of £1,200,000. The net effect of these entries would result in a loss on the sale of the castle.
The first transaction occurred on January 15, 2021, when Hagrid Ltd. acquired the castle. The acquisition cost of £1,200,000 is debited to the Castle asset account, representing an increase in the company's assets. The corresponding credit entry is made to the Cash/Bank account since cash was used to make the purchase.
As the castle has a useful life of 100 years with no residual value, the depreciation is calculated using the straight-line method, where an equal amount is allocated to each accounting period. However, no depreciation entry is required at the time of acquisition because the year-end is on December 31, and the acquisition took place on January 15.
The second transaction occurred on April 30, 2022, when Hagrid Ltd. sold the castle. The sale proceeds of £800,000 are debited to the Cash/Bank account, representing an increase in cash inflow. The Accumulated Depreciation - Castle account, which tracks the depreciation expense over time, is debited for the total depreciation accumulated until the sale date.
The credit entry is made to the Castle asset account, reducing its balance by the original cost of £1,200,000. Since the castle was sold for £800,000, the difference between the sale proceeds and the original cost results in a loss on the sale. However, since the question asks for the accounting entries, the loss is not explicitly recorded in this scenario.
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Since the question asks for the accounting entries, the loss is not explicitly recorded in this scenario.
The accounting entries related to the economic transactions involving Hagrid Ltd.'s acquisition and subsequent sale of a castle are as follows: On January 15, 2021, Hagrid Ltd. would record a debit entry to the Castle asset account for £1,200,000 and a credit entry to the Cash/Bank account for the same amount.
Additionally, a contra-asset account called Accumulated Depreciation - Castle would be created with an initial credit entry of £0. On April 30, 2022, when Hagrid Ltd. sells the castle for £800,000, the following entries would be made: a debit entry to the Cash/Bank account for £800,000
A debit entry to the Accumulated Depreciation - Castle account for the depreciation expense accumulated until the sale date, and a credit entry to the Castle asset account for the original cost of £1,200,000. The net effect of these entries would result in a loss on the sale of the castle.
The first transaction occurred on January 15, 2021, when Hagrid Ltd. acquired the castle. The acquisition cost of £1,200,000 is debited to the Castle asset account, representing an increase in the company's assets. The corresponding credit entry is made to the Cash/Bank account since cash was used to make the purchase.
As the castle has a useful life of 100 years with no residual value, the depreciation is calculated using the straight-line method, where an equal amount is allocated to each accounting period. However, no depreciation entry is required at the time of acquisition because the year-end is on December 31, and the acquisition took place on January 15.
The second transaction occurred on April 30, 2022, when Hagrid Ltd. sold the castle. The sale proceeds of £800,000 are debited to the Cash/Bank account, representing an increase in cash inflow. The Accumulated Depreciation - Castle account, which tracks the depreciation expense over time, is debited for the total depreciation accumulated until the sale date.
The credit entry is made to the Castle asset account, reducing its balance by the original cost of £1,200,000. Since the castle was sold for £800,000, the difference between the sale proceeds and the original cost results in a loss on the sale. However, since the question asks for the accounting entries, the loss is not explicitly recorded in this scenario.
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When entering university, Ranjit's father invested RM 50000 at 8% compounded quarterly for him now. Ranjit will withdraw the same amount every month for four years starting from the end of first month. How much is the withdrawal amount?
Given information: Ranjit's father invested RM 50,000 at 8% compounded quarterly for him now. Ranjit will withdraw the same amount every month for four years starting from the end of the first month.
We have to find the withdrawal amount.
Let's find the value of A using the formula of the compound interest:
A = P (1 + r/n)^(nt),
where A is the total amount,
P is the principal amount,
r is the interest rate,
t is the time the money is invested, and
n is the number of compounding periods per year.
Convert the interest rate 8% to a decimal:
r = 8/100 = 0.08.
The money is compounded quarterly, so
n = 4.
T = 4 * 4 = 16 (total number of compounding periods).
A = 50,000 (1 + 0.08/4)^(4*16)
A = 50,000 (1.02)^64
A = 50,000 * 4.61216
A = 230,608.23
We have the total amount of RM 230,608.23.
To find the withdrawal amount, we can use the formula for the present value of annuity:
PMT = (A * r) / ((1 + r)^n - 1),
where PMT is the payment amount,
A is the total amount,
r is the interest rate, and
n is the number of payments. The formula calculates the amount of money that needs to be paid each period to pay off a loan at a given interest rate over a certain period of time.
Ranjit will withdraw the same amount every month for four years starting from the end of the first month, which means there will be 4*12 = 48 payments.
The interest rate is 8% compounded quarterly, so
r = 0.08/4
= 0.02.PMT
= (230,608.23 * 0.02) / ((1 + 0.02)^48 - 1)
PMT = 230,608.23 * 0.0004140966 / 0.0203038368PMT
= 4,712.49
The withdrawal amount is RM 4,712.49 (rounded to two decimal places).Answer: The withdrawal amount is RM 4,712.49.
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Each of the four independent situations below describes a sales-type lease in which annual lease payments of $100,000 are payable at the beginning of each year. Each is a finance lease for the lessee. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 (Use appropriete fector(s) from the tebles provlded.) Situation Lease term (years) Lessor's and lessee's interest rate Residual value: 9% 11% 18% 12% Estimated fair value Guaranteed by lessee $58,80 $8,98e $8,800 $58,8e $60,8e0 Determine the following amounts at the beginning of the lease. (Round your Intermedlate and final answers to the nearest whole doller amount.) A The lessor's: 1. Lease payments 2. Gross investment in the lease 3. Net investment in the lease 5 700,000 700,000 800,000 808,000 590,574 700,000 750,000 548,592 547.137 B The lessee's: 4. Lease payments 5. Right-of-use asset 6. Lease payable 700,000 548,592 548,592 700,000 800,000 586,842 586,842
Situation Lease term (years) Lessor's and lessee's interest rate Residual value: 9% 11% 18% 12% Estimated fair value Guaranteed by lessee $58,80 $8,98e $8,800 $58,8e $60,8e0
Determine the following amounts at the beginning of the lease. (Round your Intermediate and final answers to the nearest whole dollar amount.)A) The lessor's:1. Lease payments 2. Gross investment in the lease 3. Net investment in the lease Situation Lease term (years) Lessor's and lessee's interest rate Residual value: 9% 11% 18% 12%
Estimated fair value Guaranteed by lessee $58,80 $8,98e $8,800 $58,8e $60,8e
$100,000 × 3.890 = $389,000 per year2. Gross Investment in the lease:
PV of lease payment + Residual value of the asset which is $58,800.
$389,000 + $58,800 = $447,800.3.
Net Investment in the lease: Gross Investment - Guaranteed Residual Value;
which means $447,800 - $58,800 = $389,000. Situation 2:11%
$303,800 + $8,800 = $312,600.3. Net Investment in the lease:
Gross Investment - Guaranteed Residual Value; which means
$312,600 - $8,800 = $303,800. Situation 4:12% lessee's interest rate Solution:
First, we need to find the present value of annuity factor for 5 years at 12% interest rate from the PV of an Annuity Table which comes out to be 3.604.1. Lease Payments: $100,000 × 3.604 = $360,400 per year2.
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(Selling or Buying a Loan) On November 12, 2007, a borrower closes on a loan for $176,000 at 6.25% per annum compounded daily. Repayment of the loan's maturity value (principal plus interest) is due in full on April 15, 2008. Suppose that the fine print of the original loan stipulated that the lender can sell the loan on the condition that the interest rate and maturity date remain the same. The lender sells the loan to another lender on January 5, 2008. The new lender agrees to purchase the debt for the present value of the maturity value at 10% per annum compounded daily. Assume that interest compounds daily and the borrower does not default on the loan. Use Banker's Rule when solving the following: a) What is the maturity value of the loan? b) What will the first lender receive for selling the loan? Is any profit made by the first lender? c) What profit will the second lender make on the loan's maturity date if the conditions of the original loan are unchanged? d) Though the original interest rate and maturity date are unchanged, the second lender is not prevented from reissuing the loan with a new start date set as the loan's purchase date and with the new loan's principal set as the value of the loan on the purchase date. Does the second lender make more profit by resetting the loan in this way? Explain.
In this scenario, a borrower takes a loan of $176,000 at an interest rate of 6.25% per annum compounded daily, with repayment due on April 15, 2008. The lender sells the loan to another lender on January 5, 2008, at a present value based on a 10% per annum compounded daily rate. Banker's Rule is used for calculations.
a) To determine the maturity value of the loan, we calculate the amount using the original loan terms: Maturity Value = Principal + Interest. Using the formula for compound interest, we find the interest accrued from November 12, 2007, to April 15, 2008. The maturity value is the sum of the principal and accrued interest.
b) The first lender receives the present value of the maturity value on January 5, 2008. The present value is calculated using the discount rate of 10% compounded daily. If the present value is higher than the original loan principal, the first lender makes a profit.
c) On the loan's maturity date, the second lender will receive the full maturity value, which remains unchanged from the original loan terms. The profit for the second lender is the difference between the maturity value and the present value paid to acquire the loan.
d) If the second lender reissues the loan with a new start date (January 5, 2008) and a principal equal to the purchase price, the profit would depend on the interest rate and repayment period of the new loan. By resetting the loan, the second lender may potentially earn more profit if the new terms are more favorable than the original loan terms. However, this will vary based on the specific interest rate and repayment conditions set by the second lender.
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In this scenario, a borrower takes a loan of $176,000 at an interest rate of 6.25% per annum compounded daily, with repayment due on April 15, 2008. The lender sells the loan to another lender on January 5, 2008, at a present value based on a 10% per annum compounded daily rate. Banker's Rule is used for calculations.
a) To determine the maturity value of the loan, we calculate the amount using the original loan terms: Maturity Value = Principal + Interest. Using the formula for compound interest, we find the interest accrued from November 12, 2007, to April 15, 2008. The maturity value is the sum of the principal and accrued interest.
b) The first lender receives the present value of the maturity value on January 5, 2008. The present value is calculated using the discount rate of 10% compounded daily. If the present value is higher than the original loan principal, the first lender makes a profit.
c) On the loan's maturity date, the second lender will receive the full maturity value, which remains unchanged from the original loan terms. The profit for the second lender is the difference between the maturity value and the present value paid to acquire the loan.
d) If the second lender reissues the loan with a new start date (January 5, 2008) and a principal equal to the purchase price, the profit would depend on the interest rate and repayment period of the new loan. By resetting the loan, the second lender may potentially earn more profit if the new terms are more favorable than the original loan terms. However, this will vary based on the specific interest rate and repayment conditions set by the second lender.
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benson electronics reports net income of $520,000. depreciation expense is $37,000, accounts receivable increases $11,000, and accounts payable decreases $17,000. calculate net cash flows from operating activities using the indirect method. (amounts to be deducted should be indicated with a minus sign.)
The net cash flows from operating activities using the indirect method is $563,000. This indicates the amount of cash generated or used by the company's core operations during the period, after accounting for non-cash expenses and changes in working capital.
To calculate the net cash flows from operating activities using the indirect method, we need to consider the changes in non-cash items and adjustments to net income. Here's how you can calculate it:
1. Start with the net income of $520,000.
2. Add back the depreciation expense of $37,000 since it is a non-cash expense. This is because depreciation is an accounting entry that reduces the value of an asset over its useful life.
3. Adjust for the increase in accounts receivable of $11,000. An increase in accounts receivable means that less cash was received from customers during the period, so it needs to be subtracted.
4. Adjust for the decrease in accounts payable of $17,000. A decrease in accounts payable means that more cash was paid to suppliers during the period, so it needs to be added.
5. Sum up all the adjustments:
- Depreciation expense: +$37,000
- Increase in accounts receivable: -$11,000
- Decrease in accounts payable: +$17,000
6. Calculate the net cash flows from operating activities by adding the adjustments to the net income:
$520,000 + $37,000 - $11,000 + $17,000 = $563,000
Therefore, the net cash flows from operating activities using the indirect method is $563,000. This indicates the amount of cash generated or used by the company's core operations during the period, after accounting for non-cash expenses and changes in working capital.
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