Answer:
Span of control.
Explanation:
Daniella is a manager in a big data management company. Based on her sharp management skills, she has the highest number of people assigned under her. Thus, Daniella is in charge of supervising a total number of 35 employees of the company. In this scenario, the number of employees assigned to Daniella refers to her span of control.
A span of control can be defined as the number of people (employees or workers), functions, activities which are being directly controlled effectively and efficiently by a manager in an organization.
Hence, Daniella is responsible for the functions of the 35 employees under her.
A monopolistically competitive industry is characterized by a. many firms selling products that are similar but not identical. b. many firms selling identical products. c. a few firms selling products that are similar but not identical. d. a few firms selling highly different products.
Answer:
A monopolistically competitive industry is characterized by
a. many firms selling products that are similar but not identical.
Explanation:
A monopolistic competition is a form of imperfect competition with many firms operating in the industry. For such an industry, the goods or services are differentiated, such that one firm's goods or services can easily be associated with the producer. This is mostly achieved through branding and the use of trademarks. Each firm, therefore, competes with many other competitors, but they limit their competition by differentiating their products so that consumers would have preference for one against the other, depending on their perceived value.
Jerry, the manager at Cayman's Inc., strongly believes that his subordinates prefer to be directed, avoid responsibility, and frequently need coercion to work toward company goals. Jerry is clearly a _____ manager.
Answer:
Theory X
Explanation:
Theory X is one of the types of management. In this type of management, the managers presume that the employees are not motivated towards their work. They step out with methods like remuneration and increments to motivate the employees. These additional benefits are provided to them when the employees show great responses in tangible forms. The managers hold the thought that the employees need to be controlled and threatened to bring the maximum output of them. They also assume that the employees need constant supervision at every stage of their work.
In the given excerpt, it is evident from the steps taken by Jerry that he is a Theory X manager.
Who is most likely to have claimed that "As the client becomes more self-aware, more self-acceptant, less defensive and more open, she finds at last some of the freedom to grow and change in directions natural to the human organism.?"
Answer:
- Carl Rogers
Explanation:
Carl Rogers, the American psychologist, proposed his humanistic approach often known as the 'client-centered approach' to understand psychology. He put the individuals at the center in the continuously evolving world of experience. He claimed that 'as the client evaluate and actualize their behavior due to interaction with others, they become more self-aware as well as more self-acceptant, and perceive other people as distinct and separate individuals. They also become less protective, and more agape.' This allows them to have the liberty to grow and advance their present value system.
Two companies report the same cost of goods available for sale but each employs a different inventory costing method. If the price of goods has increased during the period then the company using:______
a. LIFO will have the highest ending inventory
b. FIFO will have the highest cost of good sold
c. FIFO will have the highest ending inventory
d. LIFO will have the lowest cost of goods sold
Answer:
c. FIFO will have the highest ending inventory
Explanation:
FIFO means first in, first out. it means it is the first purchased inventory that is the first to be sold.
LIFO means last in first out. it means that it is the last purchased inventory that is the first to be sold.
If FIFO inventory method is used, the first purchased inventory is the first to be sold and price increased during the period, the beginning inventory would be lower and the ending inventory would be higher when compared to a company using LIFO
Nancy sold three capital assets that were held for investment. She sold stock in ABC Corporation for a gain of $10,000; stock in XYZ Corporation for a gain of $2,000; and corporate bonds for a loss of $20,000. Assuming all of the investments had a long-term holding period, how will the transactions be treated for tax purposes
Answer:
D) $3,000 deduction against ordinary income with a $5,000 capital loss carried forward to offset income for next year
Explanation:
Note: This question is not complete as it does not include the options. The complete question is therefore presented before answering the questions follows:
Nancy sold three capital assets that were held for investment. She sold stock in ABC Corporation for a gain of $10,000; stock in XYZ Corporation for a gain of $2,000; and corporate bonds for a loss of $20,000. Assuming all of the investments had a long-term holding period, how will the transactions be treated for tax purposes?
A) Gain of $12,000 taxed at 15% and a loss of $20,000 deductible against ordinary income
B) Net loss of $8,000 that is fully deductible against ordinary income in the current year
C) Net loss of $8,000 that results in no deduction in the current year, but can be carried forward to offset capital gains for the next year
D) $3,000 deduction against ordinary income with a $5,000 capital loss carried forward to offset income for next year
The explanation to the answer is therefore presented as follows:
The first step is to compute the net capital gain (loss) is as follows:
Particulars $
Gain from the sale of stock in ABC Corporation 10,000
Gain from the sale of stock in XYZ Corporation 2,000
Loss from the sale of corporate bonds (20,000)
Net capital gain (loss) (8,000)
In the US, individuals are allowed to use up to $3,000 to reduce their taxable income in the first year of the loss, while the remaining capital losses will be carried over to the next years.
From the net capital gain computed above, the correct option is D. That is, the $8,000 loss will be treated for tax purposes as a $3,000 deduction against ordinary income in the current year with the remaining $5,000 capital loss carried forward to offset income for next year.
J&R Renovation, Inc., is trying to determine its cost of debt. The firm has a debt issue outstanding with 20 years to maturity that is quoted at 107 % of face value. The issue makes semi-annual payments and has a coupon rate of 9 % annually.
A. What is the company's pretax cost of debt?
B. If the tax rate is 35 %, what is the aftertax cost of debt?
Answer:
a) 8.36%
b) 5.43%
Explanation:
to find the pretax cost of debt we must find the yield to maturity:
YTM = {coupon + [(face value - market value) / n]} / [(face value + market value) / 2]
YTM = {45 + [(1,000 - 1,070) / 40]} / [(1,000 + 1,070) / 2] = 43.25 / 1,035 = 0.04178 x 2 = 0.08357 = 8.36%
after tax cost of debt = 8.36% x (1 - 35%) = 8.36% x 0.65 = 5.43%
Beth is the assistant store manager at a trendy clothing store. The store hires lots of seasonal employees. Beth has little regard for the skill or ability of those she hires, and she is certain that few would come to work on time each day if it weren't for the fact that the store is known to fire any employee who fails to be on time. As a student of motivational theory, you would describe the management style of Beth as
Answer:
The correct answer will be "Theory X".
Explanation:
Through Theory X, alternatives to administration may range across a hard methodology to another soft one. The hard or challenging framework is focused on intimidation, overt threats, small compared oversight as well as tighter restrictions, which are control or perhaps management system.One such approach to management believes the average employee seems to have little motivation, lacks accountability, and therefore is structured to individual objectives.So you might well characterize Beth's leadership approach as Theory X as being a graduate of motivation factors.
Refer to Scenario 15-2. Which of the following statements is most likely to be true? (i) New entrants to the market know they will have a smaller market share than PPCo currently has. (ii) PPCo is most likely experiencing rising marginal cost. (iii) PPCo is a natural monopoly. (iv) PPCo is most likely experiencing declining average total cost.
Answer: (i), (iii) and (iv)
Explanation:
PPCo is able to provide the entire needs of the county and and has been in operations for a few years gaining loyal customers and controlling the market. Any company that will want to come in will have to fight them for market dominance and as such will have a smaller market share than PPCo.
As PPCo is meet the demands of everyone in the county, they are most likely experiencing Economies of Scale. This means that they are making more revenue thereby driving total cost down as the fixed costs remain the same but Revenue climbs. This classifies them as a Natural Monopoly because Natural Monopolies experience Economies of Scale and declining average total costs.
Which of the following is true of the strategic trade theory? a. It advocates complete deregulation of international trade. b. It explains patterns of trade based on factor endowments. c. It provides direct policy advice. d. It is the first theory to account for dynamic changes in trade patterns.
Answer: c. It provides direct policy advice
Explanation:
Strategic trade policy is a government policy whereby the excess profit that an oligopolistic international market generates will be shifted towards the firms that are in the home country.
The argument for strategic trade policy is that it help companies to take advantage of the economies of scale and also provides direct policy advice.
Gelb Company currently manufactures 49,000 units per year of a key component for its manufacturing process. Variable costs are $6.25 per unit, fixed costs related to making this component are $89,000 per year, and allocated fixed costs are $78,500 per year. The allocated fixed costs are unavoidable whether the company makes or buys this component. The company is considering buying this component from a supplier for $3.50 per unit. Calculate the total incremental cost of making 49,000 units and buying 49,000 units. Should it continue to manufacture the component, or should it buy this component from the outside supplier
Answer:
If the company buys the component, income will increase by $223,750.
Explanation:
Giving the following information:
Units= 49,000
Variable costs are $6.25 per unit
Fixed costs= $89,000 per year
The company is considering buying this component from a supplier for $3.50 per unit.
We will take into account only the differential costs.
Make:
Total cost= 49,000*6.25 + 89,000= $395,250
Buy:
Total cost= 49,000*3.5= $171,500
From the beginning, we knew that the cost of buying was cheaper than the unitary variable cost of making the part.
If the company buys the component, income will increase by $223,750.
Trident Sports Inc. manufactures and distributes athletic wear, sporting equipment, and protective sports gear worldwide. They are departmentalized based on products sold to professional athletes, products sold to people who pursue sports only for leisure, and products sold to sports teams. Which approach to departmentalization does the company follow
Answer: customer
Explanation:
From the question, we are informed that Trident Sports Inc. produces and then distributes athletic wear, sporting equipment, and protective sports gear worldwide and that they are departmentalized based on products sold to professional athletes, products sold to people who pursue sports only for leisure, and products sold to sports teams.
This shows that the approach to departmentalization that the company follow is the customer approach. This can be seen in the way that the company is departmentalized.
Which is true? Root cause analysis is an important step in the incident management process. Until the root cause of incidents is identified and eliminated, it is likely that the customer will continue to experience incidents. Typically, root causes are technology related. ITIL best practices state that root cause analysis should be performed for all incidents.
Answer:
1. Root cause analysis is an important step in the incident management process.
2. Until the root cause of incidents is identified and eliminated, it is likely that the customer will continue to experience incidents.
Explanation:
The true and correct statement is that root cause analysis is an important step in the incident management process and until the root cause of incidents is identified and eliminated, it is likely that the customer will continue to experience incidents.
Root cause analysis can be defined as a technical process which is typically used to identify or measure the reason why incidents are occurring and how to device necessary procedures to mitigate and prevent the occurrence of such incidents in the future. Ultimately, if the root cause of an incident isn't identified and properly eliminated, it is very much likely that similar or perhaps the same incident would continue to occur.
Hence, the first solution to solving a problem is identifying and eliminating the root cause.
To achieve compliance with a new industry standard, a company develops a five-year plan in which goals are set for each year with incremental organizational changes focusing on one area of the new standard. This is an example of revolutionary change. managed change. structural change. cultural change. evolutionary change.
Answer:
evolutionary change.
Explanation:
To achieve compliance with a new industry standard, a company develops a five-year plan in which goals are set for each year with incremental organizational changes focusing on one area of the new standard. This is an example of evolutionary change.
In Business management, leaders are usually saddled with the responsibility of effecting positive changes or innovative solutions, this can be achieved through the application of an evolutionary change.
Evolutionary change are usually slow and irreversible when employed in an organization. For instance, the introduction of digital platform used for taking attendance of employees in an organization.
Under a just-in-time inventory system, a company can reduce the amount of working capital it needs to finance inventory, freeing capital for other uses and/or lowering the total capital requirements of the enterprise.
a) true
b) false
Answer:
True.
Explanation:
Under a just-in-time inventory system, a company can reduce the amount of working capital it needs to finance inventory, freeing capital for other uses and/or lowering the total capital requirements of the enterprise.
In Business management, Just-in-time (JIT) is an inventory management method used by a company wherein goods, products, components, and labor are made available exactly when needed or just few hours before they are needed in the production process.
Basically, It is an inventory management system that companies use to reduce wastage to the barest minimum, thereby, freeing capital for other uses and/or lowering the total capital requirements of the enterprise.
Hence, just-in-time when used judiciously can help a company reduce the amount of working capital it needs to finance inventory management.
Suppose that Prince Puckler's Ice Cream sells 100 cones each day. It sells each cone for $3, its average variable cost is $2.50, marginal cost is $3, and the average total cost is $3.10. From this, one knows the firm:
Answer:
The firm should continue operation
Explanation:
Under the production cost theory, the comparison of price (P) and average variable cost (AVC) is used to decide whether a firm should continue operation or shut down under the following two scenarios:
Scenario 1: If P > AVC, continue operation
Scenario 2: If P < AVC, shut down.
Under scenario 1, it is better for a firm to continue operation since P is greater than AVC. This implies that the firm can fully pay for its variable cost of production and partially pay for a part of the fixed cost but not fully. As result, loss will be minimized by the firm if it continues operation.
Under scenario 2, the better decision for the firm is to shut down operation. The reason is that the firm is unable to even fully pay for its variable cost. In order to minimize cost, the firm is advised to shut down operation.
From the question, the $3 price of Prince Puckler's Ice Cream is greater than its $2.50 average variable cost. This implies that Prince Puckler falls under Scenario 1 above. Therefore, Prince Puckler should continue operation despite that the $3 prie is lower than $3.10 average total cost. This is because the variable cost will be fully covered while a part of the fixed cost will also be covered but not fully. Doing this will minimize total cost for Prince Puckler.
Therefore, one knows from the information in the question that the firm the firm should continue operation.
Coronado Company sells merchandise on account for $4600 to Wildhorse Company with credit terms of 2/10, n/30. Wildhorse Company returns $1000 of merchandise that was damaged, along with a check to settle the account within the discount period. What is the amount of the check?
Answer:
$3,528
Explanation:
The computation of the amount of the check after considering the discount period is shown below:
= Sale value fo merchandise - returned goods - discount paid
= $4,600 - $1,000 - $3,600 × 2%
= $3,600 - $72
= $3,528
By applying the above formula we can get the amount of the check and the same is to be considered
hence, the amount of the check is $3,528
Which of the following was the result in Ackerman v. Sobol Family Partnership, LLP the case in the text involving whether the plaintiffs were bound by representations of their attorney regarding settlement that they had not approved?
A- That the agreement entered into by plaintiffs' attorney would not be enforced because the plaintiffs had not signed it.
B- That the agreement would be enforced because the plaintiffs' attorney had apparent authority to enter into the agreement.
C- That the agreement entered into by plaintiffs' attorney would not be enforced because the plaintiffs had not given the attorney express authority to enter into the agreement.
D- That the agreement would be enforced because the plaintiffs' attorney had express authority to enter into the agreement.
E- That the agreement entered into by plaintiffs' attorney would not be enforced because the plaintiffs had not lead the opposing defense attorneys reasonably to believe that the plaintiffs' attorney had full and final authority to settle the litigation.
Answer:
Option B: That the agreement would be enforced because the plaintiffs' attorney had apparent authority to enter into the agreement
Explanation:
Wallace Motors measures and evaluates the quality of its cars and services against the market leaders in the automobile industry. Wherever there is a gap, Wallace Motors tries to cover that gap by imitating the best practices of these market leaders. This is known as
Answer:
Benchmarking
Explanation:
Benchmarking is defined as the activity where a company's processes and performance is compared with industry best practices. Qualities measured usually include time, cost, and quality.
In the given scenario Wallace Motors measures and evaluates the quality of its cars and services against the market leaders in the automobile industry. This the use of be marching.
When the companies metrics don't meet up, the company adopts the practices of the benchmark or later in your dreams
Garland Company received proceeds of $235000 on 10-year, 6% bonds issued on January 1, 2018. The bonds had a face value of $250000, pay interest annually on January 1, and have a call price of 101. Garland uses the straight-line method of amortization. What is the carrying value of the bonds on January 1, 2020? $236500 $246700 $250000 $238000
Answer:
$238000
Explanation:
The computation of the carrying value of the bond is shown below:
Given that
Face Value of Bonds = $250,000
Proceeds from issuance of bonds = $235,000
Before that we need to compute the following things
Now
Discount on Bonds Payable = Face Value of Bonds - Proceeds from issuance of bonds
= $250,000 - $235,000
= $15,000
Life of Bonds = 10 years
Now
Discount on Bonds amortized annually = Discount on Bonds Payable ÷ Life of Bonds
= $15,000 ÷ 10
= $1,500
Now
Discount amortized is
= Discount on Bonds amortized annually × expired life
= $1,500 × 2
= $3,000
Finally
Carrying Value of Bonds = Issue Price + Discount amortized
= $235,000 + $3.000
= $238,000
Compute interest and find the maturity date for the following notes. (Round answers to 0 decimal places, e.g. 825) Date of Note Principal Interest Rate (%) Terms (a) June 10 $78,110 7% 60 days (b) July 14 $46,200 8% 90 days (c) April 27 $11,700 9% 75 days
Answer: Interest Maturity Date
(a) 78110×7%×(60/360) = $911 August 9
(b) 46200×8%×(90/360)= $924 October 12
(c) 11700×9%×(75/360) = $219 July 11
Explanation:
To compute the interest we apply the following formula:
Interest= (Principal) × (Interest Rate) ×(Terms ÷360)
For the Maturity date, we add Terms to the Date of note .
By using the above formula for the given table, we get the following values
Interest Maturity Date
(a) 78110×7%×(60/360) = $911 August 9
(b) 46200×8%×(90/360)= $924 October 12
(c) 11700×9%×(75/360) = $219 July 11
In its third year, a project is expected to generate earnings before interest, taxes, depreciation, and amortization of $283,104 and its depreciation expense is expected to be $53,228. If the company’s tax rate is 38%, what is the project’s expected operating cash flow?
Answer:
$195,751
Explanation:
Calculation for the project's expected operating cash flow
The first step will be to find the EBIT
using this formula
EBIT =(Earnings before interest, taxes, depreciation, and amortization -Depreciation expense)
Let plug in the formula
EBIT= 283,104 - 53,228
EBIT= 229,876
Second step is to find the NOPAT using this formula
NOPAT = EBIT(1- tax rate)
NOPAT= 229,876(1 - 0.38)
NOPAT= 142,523
Last step is to calculate for Expected Operating Cash flow
Using this formula
Operating cash flow = NOPAT + Depreciation expenses
Let plug in the formula
Operating cash flow = 142,523 + 53,228
Operating cash flow = $195,751
Therefore the project's expected operating cash flow will be $195,751
At December 31 of a recent year, the following information (in thousands) was available for sunglasses manufacturer Oakley, Inc.: ending inventory $155,377; beginning inventory $119,035; cost of goods sold $349,114; and sales revenue $761,865
Calculate the inventory turnover ratio for Oakley, Inc. (Round answers to 2 decimal places, e.g. 5.12.)
Inventory turnover ratio times
Answer:
143.444 days
Explanation:
For the computation of inventory turnover ratio first we need to find out the average inventory and inventory turnover which is shown below:-
Average inventory
= (Ending inventory + Beginning inventory) ÷ 2
= ($155,377 + $119,035) ÷ 2
= $137,206
Inventory Turnover = Cost of Goods Sold ÷ Average Inventory
= $349,114 ÷ $137,206
= 2.5444 times
Days in Inventory = 365 ÷ Inventory Turnover
= 365 ÷ 2.5444
= 143.444 days
The aging method of estimating uncollectible accounts is based on the assumption that the longer an account receivable remains outstanding, the less likely it is to be collected. This statement is
Answer:
This statement is true.
Explanation:
The aging method of estimating uncollectible accounts is a method that is used to calculate the amount of counts receivable of a company that may not be collected.
Under the aging method, invoices of customers that are yet to be paid are sorted by invoice date into about four columns, and invoices with longer days assumed to be less likely to be collected.
For example, a company may have current invoice not yet due in the first column with 25% not likely to be collected; the invoice amounts that are 1-30 days past due in the second column with 50% not likely to be collected; the invoice amounts that are 31-60 days past due in third column with 75% not likely to be collected; and the invoice amounts that are 61 and above days past due in the fourth column with 100% not likely to be collected.
Based on the explanation above, it is therefore true that the aging method of estimating uncollectible accounts is based on the assumption that the longer an account receivable remains outstanding, the less likely it is to be collected.
When an organization with a functional structure diversifies into related product-markets, it generally Multiple Choice maintains its functional structure. develops a divisional structure. develops a matrix structure. develops a worldwide product-division structure.
Answer:
B). Develops a divisional structure.
Explanation:
A functional organizational structure aims to bifurcate the teams or groups on the basis of the functional or specialized area of the employees while a divisional structure organizes the teams in different divisions as per market, product, etc. Therefore, when an organization having a functional structure begins to diversify into product-related markets, it usually develops a 'divisional structure' as it is now focusing on the organization of teams corresponding to the end product or service offered by the organization. Thus, option B is the correct answer.
The Beach Shack Company produced 5,500 cakes that require 3 standard pounds per unit at $3. 00 standard price per pound. The company actually used 16,650 pounds in production. Journalize the entry to record the standard direct materials used in production.
Answer:
Explanation:
Standard pounds per cake = 3 pounds
Standard unit price = $3
Standard pounds 5500 cakes = 16,500 pounds
Actual pounds per 5500 cakes = 16,650
Variance = (16,650 - 16,500)=150
Cost of actual materials used = actual materials * standard price
=16,650*3 =49,950
Cost of work in progress = Standard materials * standard price = 16,500*3= 49.500
Direct material quantity variance = Quantity variance * 3
150*3 = 450
Journal entry
Debit work in progress = 49,500
Debit material quantity variance = 450
Credit Material = 49,950
A bond currently has a price of $1,050. The yield on the bond is 7%. If the yield increases 23 basis points, the price of the bond will go down to $1,037. The duration of this bond is ____ years.
Answer:
The duration of the bond is 5.8 years
Explanation:
Given that :
Current price of a bond $1,050
Yield on the bond = 7% = 0.07
If the yield increases 23 basis points, the price of the bond will go down to $1,037
The objective is to determine the duration of the bond.
In order to determine the duration of the bond; we need to first find the change in percentage of the price. Afterwards, this is find the modified duration which quantify the change in percentage in the market price for every change in the yield to maturity. Then finally to the determination of the duration of the bond.
Mathematically;
Percentage change in price = [tex]\dfrac{new \ price - old \ price }{old \ price}[/tex]
Percentage change in price =[tex]\dfrac{1037 - 1050 }{1050}[/tex]
Percentage change in price =[tex]\dfrac{-13 }{1050}[/tex]
Percentage change in price = −0.01238
Percentage change in price ≅ - 0.0124
Percentage change in price = - 1.24%
Let recall from the knowledge of our basis points which say;
1 basis point = 1/100
Therefore ; given that if he yield increases 23 basis points, then we have:
23 basis point = 23/100 = 0.23
The modified duration = [tex]\dfrac{percentage \ change \ in \ price }{ change}[/tex]
The modified duration = [tex]\dfrac{1.24 }{0.23}[/tex]
The modified duration = 5.3913 years
Finally, The duration of the bond = Modified duration × (1 + Yield to Maturity)
The duration of the bond = 5.3913 × (1 + 0.07)
The duration of the bond = 5.3913 × 1.07
The duration of the bond = 5.768691 years
The duration of the bond ≅ 5.8 years
Lisa lives next to a vacant plot that belongs to Carol. Carol has never visited the plot in the last 20 years during which period, Lisa has taken care of it by fencing the plot and mowing the grass. If this continues, Lisa will be able to claim ownership of land based on:
Answer:
Adverse possession.
Explanation:
In this scenario, Lisa lives next to a vacant plot that belongs to Carol. Carol has never visited the plot in the last 20 years during which period, Lisa has taken care of it by fencing the plot and mowing the grass. If this continues, Lisa will be able to claim ownership of land based on adverse possession.
In Real estate law, Adverse possession is a legal principle which allows a non-owner individual to possess a piece of land and gain title with the exclusion of the real owner, after a certain period of time.
However, the non-owner occupant must proof to the court of law meets the following requirements;
1. Continuous.
2. Hostile.
3. Open.
4. Actual.
5. Exclusive.
An investment-banking firm underwrites a new issue of stocks and bonds by Multiple Choice buying the entire bond or stock issue a company wants to sell at an agreed discount. guaranteeing a minimum price in the market for a stock or bond. selling the entire bond or stock issue for the issuing firm in global markets. putting up collateral for long-term loans, such as bonds.An investment-banking firm underwrites a new issue of stocks and bonds by Multiple Choice buying the entire bond or stock issue a company wants to sell at an agreed discount. guaranteeing a minimum price in the market for a stock or bond. selling the entire bond or stock issue for the issuing firm in global markets. putting up collateral for long-term loans, such as bonds.
Answer:
buying the entire bond or stock issue a company wants to sell at an agreed discount.
Explanation:
An investment-banking firm underwrites a new issue of stocks and bonds by buying the entire bond or stock issue a company wants to sell at an agreed discount.
Underwriting can be defined as the process through which an individual or organization assumes a financial risk at an appropriate and agreed fee.
In order to underwrite a new issue of securities such as bonds or stocks, the investment-banking firm buys the entire securities that the issuer is willing to sell at an agreed discount.
Several controls are used to safeguard inventory except a.keeping high-priced inventory behind lock and key. b.hiring security guards. c.allowing all employees access to the materials warehouse. d.installing sensors at all exits.
Answer:
Option C, allowing all employees access to the materials warehouse, is the right answer.
Explanation:
Option C is the correct answer because option C recommends allowing access to all the employees. However, allowing access to all employees will reduce security and increase the risk level. While all given options are helpful in safeguarding the inventory except option C. Thus, in this case, it would be difficult to monitor every employee. So Option C is the right answer.
Q 11.40: Woolley Cloth Distributors issued 25,000 shares of $10 stated value no par stock in exchange for land with an advertised price of $318,000. The stock is currently trading for $12 per share. Journalize the entry to recognize the exchange.
Answer:
The entry to recognize the exchange :
Land $318,000 (debit)
Common Stock $300,000 (credit)
Accounts Payable $300,000 (credit)
Explanation:
The Price of stock is equivalent to the issue price at the date of the transaction of $12.
Note that the Common Stocks do not have par value, this means there is no share premium reserve on the stocks that needs to be recognized.
Since the Price of land is above the price of common stocks, the remainder is the amount owing, a liability.