Answer:
Saves time
Explanation:
You manage an equity fund with an expected risk premium of 10% and an expected standard deviation of 15%. The rate on Treasury bills (risk-free rate) is 5%. Your client chooses to invest $60,000 of her portfolio in your equity fund and $40,000 in a T-bill money market fund.
Required:
What is the expected return and standard deviation of return on your client's portfolio?
Answer:
Portfolio expected return = 8%
Portfolio SD = 9%
Explanation:
Portfolio return is a function of the weighted average return of each stock or asset invested in the portfolio. The mean return on portfolio can be calculated using the following formula,
Portfolio return = wA * rA + wB * rB + wN * rN
Where,
w represents the weight of each stock or asset in the portfolior represents the return of each stock or asset in the portfolioTotal investment in portfolio = 60000 + 40000 = 100000
Portfolio return = 60000/100000 * 10% + 40000/100000 * 5%
Portfolio return = 8%
The standard deviation of a portfolio containing one risky and one risk-free asset is calculated by multiplying the standard deviation of the risky asset by its weight in the portfolio. So, portfolio standard deviation will be,
Portfolio SD = 60000/100000 * 15%
Portfolio SD = 9%
Jamal is a web designer working on an e-commerce website for a client. He is looking for information regarding the buying habits of 50- to 60-year-old males who have no children. What sources are considered reliable?
Select all that apply.
published marketing survey
government data
blogs
Wikipedia
The balance sheets for Plasma Screens Corporation and additional information are provided below. PLASMA SCREENS CORPORATION Balance Sheets December 31, 2021 and 2020 2021 2020 Assets Current assets: Cash $ 158,800 $ 123,000 Accounts receivable 84,000 95,000 Inventory 98,000 83,000 Investments 4,300 2,300 Long-term assets: Land 510,000 510,000 Equipment 820,000 700,000 Less: Accumulated depreciation (458,000 ) (298,000 ) Total assets $ 1,217,100 $ 1,215,300 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 102,000 $ 88,000 Interest payable 7,500 12,300 Income tax payable 9,500 5,300 Long-term liabilities: Notes payable 100,000 200,000 Stockholders' equity: Common stock 730,000 730,000 Retained earnings 268,100 179,700 Total liabilities and stockholders' equity $ 1,217,100 $ 1,215,300 Additional information for 2021: Net income is $88,400. Sales on account are $1,628,900. Cost of goods sold is $1,230,800. Required: 1. Calculate the following risk ratios for 2021: (Round your answers to 1 decimal place.)
Answer:
Missing word: "a. Receivables turnover ratio b. Inventory turnover ratio c. Current ratio d. Acid-test ratio d. Debt-equity ratio"
a. Receivable turover ratio = Net credit sales/ Average receivbles
= $1,628,900/ (($84000+$95000)/2)
= $1,628,900 / $89,500
= 18.2 Times
b) Inventory Turnover ratio = Cost of goods sold / Average inventory
= $1,230,800/ (($98,000+$83,000)/2)
= $1,230,800/$90,500
= 13.6 Times
c) Current ratio = Current assets / Current liabilities
= ($158,000+$84,000+$98,000+$4,300) / ($102,000+$7,500+$9,500
= $344,300/$119,000
= 2.893277311
= 2.89 to 1
d) Acid test ratio = ( Current assets - Inventory ) / Current liabilities
= ($344,300 - $98,000) / $119,000
= $246,300 / $119,000
= 2.0697478992
= 2.07
e) Debt-equity ratio = Total Liability (Current + Non-current) / Stockholders' equity
= ($119,000+$100,000) / ($730,000+$268,100)
= $219,000 / $998,100
= 0.2194169
= 22%
According to the video, what qualities are needed by Merchandise Displayers and Window Trimmers? Check all that
apply
O creativity
O leadership
O marketing skills
ability to work under pressure
O research skills
O ability to speak clearly
Answer:
he/she is correct
Explanation:
i can verify
The qualities needed by Merchandise Displayers and Window Trimmers are creativity, marketing skills, and the ability to work under pressure.
Retail merchandise displays are set up for maximum impact by merchandise displayers and window trimmers, who also need the ability to multitask under time constraints.
The purpose of merchandise displays is to draw in and entice customers by giving a special presentation of a store's merchandise. To achieve this requirement, they must have strong marketing abilities that enable them to interact with clients successfully.
Learn more about marketing skills, here:
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Which situation(s) would be considered unethical design practices?
Select all that apply.
copying a design idea
making false claims about a product
designing a political campaign
using your own photographs
Answer:
I think A
Explanation:
copying a design idea
On January 1, 2017, Fisher Corporation purchased 40 percent (74,000 shares) of the common stock of Bowden, Inc. for $980,000 in cash and began to use the equity method for the investment. The price paid represented a $66,000 payment in excess of the book value of Fisher's share of Bowden's underlying net assets. Fisher was willing to make this extra payment because of a recently developed patent held by Bowden with a 15-year remaining life. All other assets were considered appropriately valued on Bowden's books.
-Bowden declares and pays a $94,000 cash dividend to its stockholders each year on September 15. Bowden reported net income of $408,000 in 2017 and $356,000 in 2018. Each income figure was earned evenly throughout its respective year.
-On July 1, 2018, Fisher sold 10 percent (19,500 shares) of Bowden's outstanding shares for $328,000 in cash. Although it sold this interest, Fisher maintained the ability to significantly influence Bowden's decision-making process.
Required:
Prepare the journal entries for Fisher for the years of 2017 and 2018.
Answer:
Investment in Bowden Inc. (Dr.) $980,000
Cash (Cr.) $980,000
Dividend receivable 94,000 * 40% (Dr.) $37,600
Investment in Bowden (Cr.) $37,600
Cash (Dr.) $37,600
Dividend Receivable (Cr.) $37,600
Investment in Bowden 408,000 *40% (Dr.) $163,200
Income From Bowden (Cr.) $163,200
Investment in Bowden 365,000 * 6/12 * 40% (Dr.) $71,200
Income from Bowden (Cr.) $71,200
Investment in Bowden 365,000 * 6/12 * 10% (Dr.) $17,800
Income from Bowden (Cr.) $17,800
Cash (Dr.) 328,000
Gain on Investment (Cr.) $69,756
Investment in Bowden (Cr.) $258,243
Explanation:
Gain on investment in Bowden :
Investment value $980,000
Total number of shares 74,000
Per share value 980,000 / 74,000 = 13.24
Sold 19,500 shares
Value of shares sold : 19,500 shares * 13.24 per share = $258,243
Sale price for shares = $328,000
Gain on Sale of investment = $69,756
At the beginning of the current year, Hardin Company had 20,000 shares of $10 par common stock outstanding. During the year, it engaged in the following transactions related to its common stock, so that at year-end it had 63,800 shares outstanding: Apr. 1Issued 5,000 shares of stock. June 1Issued 4,000 shares of stock. July 1Issued a 10% stock dividend. Sept. 30Issued a 2-for-1 stock split, reducing the par value to $5 per share. Oct. 1Reacquired 1,000 shares as treasury stock. Nov. 30Reissued the 1,000 shares of treasury stock. Required: Determine the weighted average number of shares outstanding for computing the current earnings per share. Round your interim computations and final answer for the number of shares to nearest whole number.
Answer:
Hardin Company
The weighted average number of shares outstanding for computing the current earnings per share is:
= 35,841.
Explanation:
a) Data and Calculations:
Date Transaction Number Weight Result
January 1 Outstanding 20,000 12/12 20,000
April 1 Issue of shares 5,000 9/12 3,750
June 1 Issue of shares 4,000 7/12 2,333
July 1 Stock Dividend 2,900 6/12 1,450
Sept. 30 Stock split 31,900 3/12 7,975
Oct. 1 Treasury Stock (1,000) 3/12 250
Nov. 30 Treasury Stock 1,000 1/12 83
Dec. 31 Outstanding weighted average shares 35,841
b) The Stock dividend was issued to 29,000 shares. The 10% gives 2,900 shares. For the stock split of 2 for 1, the number of shares will double, meaning that each shareholder will now have 2 shares.
Construct a contingency table from the following data where the two rows represent
whether the person was a democrat (D) or a republican (R) and the two columns
represent whether the person said that they intended to vote for Clinton (C) or
Trump (T).
Political
DRDDRDRRRDRRRDDRDRDR
Party
Candidate TCCTCTTCTCTT CCTCTTC
How many intend to vote for Clinton (C)?
(Round your answer to three decimal places.)
Your Answer:
9
Answer
Next Page
Page 20 of 20
Answer:
Clinton (C) Trump (T) Total
Democrat (D) 5 4 9
Republican (R) 4 7 11
Total 9 11 20
From the Contingency table above, we can see that 9 people intend to vote for Clinton.
if you are going to create or own a business, what would it ? List at least 3 and cite your reasons why you have listed them.
Answer:
Milktea shop, coffee shop, computer shop
Explanation:
hope this helps
Sheridan Company makes and sells widgets. The company is in the process of preparing its selling and administrative expense budget for the month. The following budget data are available: Item Variable Cost Per Unit Sold Monthly Fixed Cost Sales commissions $1 $10000 Shipping $3 Advertising $4 Executive salaries $120000 Depreciation on office equipment $4000 Other $2 $6000 Expenses are paid in the month incurred. If the company has budgeted to sell 94000 widgets in October, how much is the total budgeted selling and administrative expenses for October
Answer:
$1,080,000
Explanation:
Calculation to determine how much is the total budgeted selling and administrative expenses for October
October Total budgeted selling and administrative expenses=
[($1 + $3 + $4 + $2) x 94,000] + ($10,000 +
$120,000 + $4,000 + $6,000)
October Total budgeted selling and administrative expenses=(10*94,000)+$140,000
October Total budgeted selling and administrative expenses=$940,000+$140,000
October Total budgeted selling and administrative expenses=$1,080,000
Therefore the total budgeted selling and administrative expenses for October is $1,080,000
A-Z Technologies, a manufacturer of amplified pressure transducers, is trying to decide between a dual-speed and a variable-speed machine. The engineers are not sure about the salvage value of the variable-speed machine, so they have asked several different used-equipment dealers for estimates. The results can be summarized as follows: there is a 35% chance of getting $21,500; a 41% chance of getting $22,000; and a 13% chance of getting $36,000. Also, there is an 11% chance that the company may have to pay $7,000 to dispose of the equipment. Calculate the expected salvage value.
Answer:
Expected salvage value = $20455
Explanation:
The expected salvage value of the machine can be calculated by multiplying the expected salvage values by their relative probabilities and then summing up the resulting values. The following formula can be used,
Expected salvage value = pA * svA + pB * svB + ... + pN * svN
Where,
p represents the probability of each scenariosv represents the salvage value under each scenarioA, B, ... , N represents scenario A, B, ... , till Nth number of scenarioExpected salvage value = 0.35 * 21500 + 0.41 * 22000 + 0.13 * 36000 +
0.11 * -7000
Expected salvage value = $20455
A Kubota tractor acquired on January 8 at a cost of $315,000 has an estimated useful life of 10 years. Assuming that it will have no residual value. a. Determine the depreciation for each of the first two years by the straight-line method. First Year Second Year $fill in the blank 1 31,500 $fill in the blank 2 31,500 b. Determine the depreciation for each of the first two years by the double-declining-balance method. Do not round the double-declining balance rate. If required, round your final answers to the nearest dollar.
Answer:
A. Year 2 $31,500
Year 2 $31,500
B. Year 1 = 63,000
Book Value of Tractor $252,000
Year 2 $ 50,400
Book Value of Tractor $201,600
Explanation:
a. Calculation to Determine the depreciation for each of the first two years by the straight-line method
Year 1 = $315,000 / 10
Year 1 = $31,500
Year 2 = $315,000 / 10
Year 2= $31,500
B) Calculation to determine the depreciation for each of the first two years by the double-declining-balance method
Based on the information given we are first going to calculate the percentage of depreciation using straight line method and then double it
Percentage = $ 315,000 *10%
Percentage=$31,500
Now let depreciation the book value each year by 20% Using the double-declining-balance method method
Year 1=20% of $ 315,000
Year 1= 63,000
Book Value=$315,000 - $63,000
Book Value= $ 252,000
Year 2= 20% of 252,000
Year 2 = $ 50,400
Book Value=$ 252,000 -$50,400
Book Value= $201,600
a customer complains about the food, saying it does not suit his taste. what will you do?
Answer:
Well, I'll ask if there is anything specific he would love to have that would be to his taste. key note is to be humble and tolerant to your customers.
The stage of Bruce Tuckman’s group decision-making process in which the members express their individual needs and opinions is ________.
The needs of the individual and the opinion should be mandatory.
What is the stage of Bruce Tuckman’s group?In the year 1965, Bruce Tuckman is psychologist mentioned that the team should go via five stages of development i.e. forming, norming, storming, performing, and adjourning. The stages begin from the time when the group should be first meeting till the end of the project.
hence, The needs of the individual and the opinion should be mandatory.
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Sandy is considering moving from her apartment into a small house with a fenced yard. The apartment is noisy, and she has difficulty studying. In addition, the fenced yard would be great for her dog. The distance from school is about the same from the house and from the apartment. The apartment costs $750 per month, and she has 2 months remaining on her lease. The lease cannot be broken, so Sandy must pay the last 2 months of rent whether she lives there or not. The rent for the house is $450 per month, plus utilities, which should average $100 per month. The apartment is furnished; the house is not. If Sandy moves into the house, she will need to buy a bed, dresser, desk, and chair immediately. She thinks that she can pick up some used furniture for a good price. Which of the following costs is irrelevant to Sandy's decision to stay in the apartment or move to the house?
a. House rent of $450 per month.
b. Utilities for the house of $100 per month.
c. The noise in the apartment house.
d. The cost of the used furniture.
Answer:
Noise in the apartment house
Explanation:
Costs are units or monetary value which are incurred/spent on taking a certain action. It is often quantitative in nature that is something that can be measured. Although noise is a factor which can affect Sandy's decision of moving from the apartment, it cannot be considered as a cost. Noise of the apartment is a qualitative factor. It does not have an intrinsic monetary value. Thus, in this regard it is an irrelevant cost for Sandy's decision to stay in the apartment or move to the house.
The other options have a monetary value and thus they are relevant for Sandy's decision.
What does bolding do to text?
Answer:
Explanation:
Usually you select the word or sentence you want to bold using your cursor, to make the word lines thicker and have the words stand out more. Most websites have the bold function denoted with a B so you can easily understand that the button is used for making a word or sentences bold. It's used in newspapers to highlight sections or to emphasize words or the beginning of paragraphs.
You own two bonds. Both bonds pay annual interest, have 6 percent annual coupons, $1,000 face values, and currently have 6 percent yields to maturity. Bond A has 12 years to maturity and Bond B has 4 years to maturity. If the market rate of interest rises unexpectedly to 7 percent, Bond _____ will be the most volatile with a price decrease of _____ percent.
Answer:
Bond A is most volatile and 7.94%
Explanation:
The computation is shown below;
Particulars Bond A Bond B
Interest ($1,000 × 6%) $60 $60
Period 12 4
PVAF at 7 for 12 years 7.942886
PVAF at 7% for 4 years 3.387211
PVF at 7% for 12 years 0.444012
PVF at 7% for 4 years 0.762895
The present value of interest $476.56
($60 × 7.942686)
The present value of interest $203.2327
($60 × 3.387211)
Present value of fair value $444.012
($1,000 × 0.444012)
Present value of fair value $762.8952
($1,000 × 0.762895)
Present value $920.57 $966.1279
The decrease in percentage is
= ($1,000 - $920.57) ÷ $1,000
= 7.94%
Bond A is most volatile
A bookkeeper prepared the year-end financial statements of Giftwrap, Inc. The income statement showed net income of $22,300, and the balance sheet showed ending retained earnings of $90,500. The firm's accountant reviewed the bookkeeper's work and determined that adjustments should be made that would increase revenues by $5,900 and increase expenses by $8,800.
Required:
Calculate the amounts of net income and retained earnings after the preceding adjustments are recorded.
Answer:
• Net income $19,400
• Retained earnings $87,600
Explanation:
With regards to the above,
Net income before adjustments
$22,300
Add: Increase in revenue
$5,900
Less: Increase in expenses
($8,800)
Net income after adjustment
$19,400
Retained earnings before adjustment
$90,500
Less: Decrease in net income ($22,300 - $19,400)
($2,900)
Retained earnings after adjustment
$87,600
Snow White Frame Company's cost formula for its supplies cost is $1,740 per month plus $8 per frame. For the month of March, the company planned for activity of 614 frames, but the actual level of activity was 620 frames. The actual supplies cost for the month was $6,850. The activity variance for supplies cost in March would be closest to:
Answer:
$48 U
Explanation:
Calculation to determine what The activity variance for supplies cost in March would be closest to:
First step is to calculate the Planning supply activity cost
Planning supply activity cost = (614 × $8) +$1,740
Planning supply activity cost = 4,912+$1740
Planning supply activity cost = $6652
Second step is to calculate the Actual supply activity cost
Actual supply activity cost = (620 × $8) + $1,740
Actual supply activity cost =4960+$1,740
Actual supply activity cost =$6,700
Now let calculate the Activity variance for supplies cost using this formula
Activity variance for supplies cost = Actual activity cost – Planning activity cost
Let plug in the formula
Activity variance for supplies cost= $6,700 - $6,652
Activity variance for supplies cost= $48 Unfavorable
Therefore The activity variance for supplies cost in March would be closest to:$48 U
The following information exists for ABC Company:
Selling price per unit: $30
Variable expenses per unit: $21
Fixed expenses for the period: $60,000
Sales volume in units: 10,000
If selling price is reduced by $2 and sales volume increases by 3,000 units, total contribution margin will increase by $__________ .
Answer:
Difference= $1,000 increase
Explanation:
Giving the following information:
Selling price per unit: $30
Variable expenses per unit: $21
New selling price= 30 - 2= $28
New units sales= 13,000
First, we need to calculate the current contribution margin:
Total contribution margin= units sold*unitary contribution margin
Total contribution margin= 10,000*(30 - 21)
Total contribution margin= $90,000
Now, the new contribution margin:
Total contribution margin= 13,000*(28 - 21)
Total contribution margin= $91,000
Decca Publishing paid $230,000 to acquire Thrifty Nickel, a weekly advertising paper. At the time of the acquisition, Thrifty Nickel balance sheet reported total assets of $130,000 and liabilities of $70,000. The fair market value of Thrifty Nickels assets was $100,000. The fair market value of Thrifty Nickel liabilities was $70,000.
Required:
a. How much goodwill did Decca Publishing purchase as part of the acquisition of Thrift Nickel?
b. Journalize Decca Publishing's acquisition of Thrifty Nickel.
Answer:
Part a
$200,000
Part b
Debit : Investment in subsidiary $230,000
Credit : Cash $230,000
Explanation:
Goodwill is the excess of the Purchase Price over the Net Assets taken over at the acquisition date.
Assets and liabilities are taken over at their acquisition date Fair Values instead of Book Values so be sure to adjust any items shown at Book Value.
Net Assets = Assets at Fair Value - Liabilities at Fair Value
= $100,000 - $70,000
= $30,000
Goodwill = Purchase Price - Net Assets Taken over
= $230,000 - $30,000
= $200,000
Henna Co. produces and sells two products, T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 56,000 units of each product. Sales and costs for each product follow.
Product T Product O
Sales $929,600 $929,600
Variable costs 650,720 185,920
Contribution margin 278,880 743,680
Fixed costs 132,880 597,680
Income before taxes 146,000 146,000
Income taxes (32% rate) 51,100 51,100
Net income $94,900 $94,900
Required:
Compute the break-even point in dollar sales for each product.
Answer:
Henna Co.
Break-even point in dollar sales:
= Total costs = Sales revenue
Product T Product O
Break-even point (sales dollars) = $783,600 $783,600
Explanation:
a) Data and Calculations:
Product T Product O
Sales $929,600 $929,600
Variable costs 650,720 185,920
Contribution margin 278,880 743,680
Fixed costs 132,880 597,680
Income before taxes 146,000 146,000
Income taxes (32% rate) 51,100 51,100
Net income $94,900 $94,900
Break-even point in dollar sales:
= Total costs = Sales revenue
Product T Product O
Variable costs $650,720 $185,920
Fixed costs 132,880 597,680
Total costs 783,600 783,600
Sales revenue $783,600 $783,600
5.For the past year, Chandler Company had fixed costs of $70,000, unit variable costs of $32, and a unit selling price of $40. For the coming year, no changes are expected in revenues and costs, except that property taxes are expected to increase by $10,000. Determine the break-even sales (units) for: (12 pts ~ 6 pts each) a.The past year: b.The coming year
Answer:
a.
Break even in units = 8750 units
b.
Break even in units = 10000 units
Explanation:
The break even in units is the number of units that a business must sell in order to for its total revenue to be equal to total costs and for it to break even. The break even in units is calculated as follows,
Break even in units = Fixed Costs / Contribution margin per unit
Where,
Contribution margin per unit = Selling price per unit - Variable cost per unit
a. Past Year
Break even in units = 70000 / (40 - 32)
Break even in units = 8750 units
b. Coming Year
The property taxes which are a fixed cost will increase by $10000. Thus total fixed cost for coming year will be = 10000 + 70000 = 80000
Break even in units = 80000 / (40 - 32)
Break even in units = 10000 units
GIVING 50 POINTS AND BRAINLIEST
PLS HURRY
Answer:
i aint downloading the document sounds fishy
it sounds fishy sorry- lol
Answer:
yeah sounds fishy but thanks anyways
Explanation:
sorryyy
The Armstrong Corporation developed a flexible budget for its production process. Armstrong budgeted to use 12,000 pounds of direct material with a standard cost of $14 per pound to produce 14,000 units of finished product. Armstrong actually purchased 24,000 pounds and used 15,000 pounds of direct material with a cost of $30 per pound to produce 14,000 units of finished product. Given these results, what is Armstrong's direct material pricevariance?
a. $234,000 unfavorable
b. $156,000 unfavorable
c. $234,000 favorable
d. $156,000 favorable
Answer:
A. $234,000 unfavorable
Explanation:
Calculation to determine Armstrong's direct material price variance
Using this formula
Direct material price variance=[(Standard cost-Actual cost)*Actual quantity]
Let plug in the formula
Direct material price variance=[($11-$24)*18,000)
Direct material price variance=$13*18,000
Direct material price variance=$234,000 Unfavorable
Therefore Armstrong's direct material price variance is $234,000 Unfavorable
Testbank Multiple Choice Question 88 Concord Corporation, has 14300 shares of 4%, $100 par value, cumulative preferred stock and 59400 shares of $1 par value common stock outstanding at December 31, 2021. There were no dividends declared in 2019. The board of directors declares and pays a $116000 dividend in 2020 and in 2021. What is the amount of dividends received by the common stockholders in 2021
Answer:
$60,400
Explanation:
Calculation to determine the amount of dividends received by the common stockholders in 2021
2021 Dividend received =($116,000*2)-[(14,300 × $100 × .04)×3]
2021 Dividend received =$232,000-($57,200×3)
2021 Dividend received =$232,000-$171,600
2021 Dividend received =$60,400
Note that 2020 and 2021 will give us 2 years; 2019,2020and 2021 will give us 3 years
Therefore the amount of dividends received by the common stockholders in 2021 will be $60,400
The average price of a gallon of gas in 2015 dropped $0.94 (28 percent) from $3.34 in 2014 (to $2.40 in 2015). Let’s see whether these changes are reflected in the income statement of Insignia Corporation for the year ended December 31, 2015 (amounts in billions).
2015 2014
Revenues $225 $242
Cost of Purchased Crude Oil and Products 119 127
Other Operating Costs 59 52
Income before Income Tax Expense 47 63
Required:
a. Compute the gross profit percentage for each year. Assuming that the change from 2014 to 2015 is the beginning of a sustained trend, is Insignia likely to earn more or less gross profit from each dollar of sales in 2016?
b. Compute the net profit margin for each year.
Answer:
Note: See missing wordings in attached picture below
a. 2015
Gross profit percentage = [Total revenue - Cost of crude oil and products] / Total revenue
Gross profit percentage = [$225 - $119] / $225
Gross profit percentage = $106 / $225
Gross profit percentage = 0.47111111
Gross profit percentage = 47.11%
2014
Gross profit percentage = [Total revenue - Cost of crude oil and products] / Total revenue
Gross profit percentage = [$242 - $127] / $242
Gross profit percentage = $115 / $242
Gross profit percentage = 0.475206612
Gross profit percentage = 47.52%
Conclusion: Insignia Corporation are likely to earn less gross profit from each dollar of sales in 2016 because Gross profit percentage decreased from 2014 to 2015.
b. 2015
Net profit margin = Net income / Total revenue
Net profit margin = $26/$225
Net profit margin = 0.1155555
Net profit margin = 11.56%
2014
Net profit margin = Net income / Total revenue
Net profit margin = $37/$242
Net profit margin = 0.152893
Net profit margin = 15.29%
Kenji lives in Detroit and runs a business that sells boats. In an average year, he receives $793,000 from selling boats. Of this sales revenue, he must pay the manufacturer a wholesale cost of $430,000; he also pays wages and utility bills totaling $301,000. He owns his showroom; if he chooses to rent it out, he will receive $15,000 in rent per year. Assume that the value of this showroom does not depreciate over the year. Also, if Kenji does not operate this boat business, he can work as a financial advisor, receive an annual salary of $50,000 with no additional monetary costs, and rent out his showroom at the $15,000 per year rate. No other costs are incurred in running this boat business.
Identify each of Charles's costs in the following table as either an implicit cost or an explicit cost of selling guitars.
a. The wages and utility bills that Charles pays
b. The wholesale cost for the guitars that Charles pays the manufacturer
c. The rental income Charles could receive if he chose to rent out his showroom
d. The salary Charles could earn if he worked as a financial advisor
Answer:
a. The wages and utility bills that Charles pays - Explicit cost
b. The wholesale cost for the guitars that Charles pays the manufacturer- Explicit cost
c. The rental income Charles could receive if he chose to rent out his showroom - Implicit cost
d. The salary Charles could earn if he worked as a financial advisor - Implicit cost
Explanation:
Explicit costs are the costs which are incurred to run the business. These are direct costs incurred by the individual. For instance, wages paid by firms, cost of furniture, building, etc. The explicit costs will thus include,
a. Wholesale cost paid to the manufacturer ($430,000)
b. Wages and utility bills ($301,000)
Implicit costs are those costs which are not directly incurred by an individual/ business. These are costs of the lost alternative i.e the opportunity cost of an action. For instance, the cost of forgone rent which could have been earned on renting the office space or building. Thus, Charles implicit costs are
a. Rent of the showroom ($15,000)
b. Salary from being a financial advisor ($50,000)
On January 1, 2016, Telespace Inc. grants 6 million non-qualified stock options to its employees. The stock options have exercise price of $20, which is equal to the grant-date price. All options will vest in three years. The grant date fair value of the options is $15 per option. All 6 million options are expected to vest. On January 1, 2019, all 6 million vested options are exercised when the stock price is $50. The applicable tax rate for all periods is 40%. The company has sufficient taxable income for the stock option tax deductions to reduce income taxes payable in all periods.
How much compensation expense should Telespace recognize for the year of 2016?
Answer:
$30,000,000
Explanation:
compensation expense = total number of stocks granted x grant date value = 6,000,000 x $15 = $90,000,000
this expense will be allocated proportionally during the vesting period = $90,000,000 / 3 years = $30,000,000 per year
compensation expense per year (2016, 2017, 2018) = $30,000,000
what challenges do managers face in motivating today's workforce?
Answer:
Each individual employee has their own set of beliefs and needs, and you can rarely find two of them who are alike. Therefore, managers have a hard time understanding how different their employees are. Also, it's hard to keep up with all the employee needs if they are constantly changing and evolving.
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