Answer:
a) Product G should be produced and sold
b) Net financial advantage $80
Explanation:
A company should process further a product if the additional revenue from the split-off point is greater than than the further processing cost.
Also note that all cost incurred up to the split-off point are irrelevant to the decision to process further .
$
Revenue after split-off point
($9× 40 litres) 360
Revenue at the slit of point
($4 × 40) (160)
Additional income from further processing 200
Further processing cost ($3× 40) (120)
Incremental income from further processing 80
Incremental income from further processing = $80
a) The product F should be processed further and sold as product G. Doing so would increase the net income by $80.
b) Net advantage $80
The country of Morson has decided to privatize the state-owned cable television company. How can the country help this newly privatized industry succeed
Answer:
Government Support
Explanation:
Privatization is better for a country. It minimizes the monopoly and encourages healthy competition. Increased competition in the business world is good. There can be variety of services available to the consumers. Government should support privatization by introducing schemes of interest free loan for investors. There will be large number of firms that might want to enter business world but the money is not available to them for startup.
. Identify each of the following as (i) part of an expansionary fiscal policy, (ii) part of a contractionary fiscal policy, or (iii) not part of fiscal policy. a. The personal income tax rate is lowered. b. Congress cuts spending on defense. c. College students are allowed to deduct tuition costs from their federal income taxes. d. The corporate income tax rate is lowered. e. The state of Nevada builds a new tollway in an attempt to expand employment and ease traffic in Las Vegas.
Answer:
Option, A , D, E = expansionary fiscal policy.
Option B = Contractionary fiscal policy
Option C = not a part of fiscal policy
Explanation:
The expansionary fiscal policy occurred when there is a decrease in taxes and an increase in government expenditure (spendings). While contractionary fiscal policy occurs when taxes are increased by the government and there is a fall or decrease in government spendings. Therefore, Option A, Option D, and Option E are part of the expansionary fiscal policy.
Option B is a contractionary fiscal policy. While option C is not a part of fiscal policy
Exercise 10-6 Direct Materials and Direct Labor Variances [LO10-1, LO10-2] Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard Quantity or Hours Standard Price or Rate Standard Cost Direct materials 7.40 pounds $ 2.60 per pound $ 19.24 Direct labor 0.45 hours $ 8.00 per hour $ 3.60 During the most recent month, the following activity was recorded: 12,100.00 pounds of material were purchased at a cost of $2.50 per pound. All of the material purchased was used to produce 1,500 units of Zoom. 575 hours of direct labor time were recorded at a total labor cost of $5,750. Required: 1. Compute the materials price and quantity variances for the month. 2. Compute the labor rate and efficiency variances for the month.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Direct material:
Standard= 7.40 pounds $ 2.60 per pound
Actual= 12,100 pounds of material were purchased for $2.50 per pound.
Direct labor:
Standard= 0.45 hours $ 8.00 per hour
Actual= 575 hours of direct labor time were recorded at a total labor cost of $5,750
Units produced= 1,500
To calculate the direct material price and quantity variance, we need to use the following formulas:
Direct material price variance= (standard price - actual price)*actual quantity
Direct material price variance= (2.6 - 2.5)*12,100
Direct material price variance= $1,210 favorable
Direct material quantity variance= (standard quantity - actual quantity)*standard price
standard quantity= 1,500*7.4= 11,100
Direct material quantity variance= (11,100 - 12,100)*2.6
Direct material quantity variance= $2,600 unfavorable
To calculate the direct labor efficiency and rate variance, we need to use the following formulas:
Direct labor time (efficiency) variance= (Standard Quantity - Actual Quantity)*standard rate
Standard quantity= 1,500*0.45= 675
Direct labor time (efficiency) variance= (675 - 575)*8
Direct labor time (efficiency) variance= $800 favorable
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Actual rate= 5,750/575= $10
Direct labor rate variance= (8 - 10)*575
Direct labor rate variance= $1,150 unfavorable
You are thinking of building a new machine that will save you $ 4 comma 000$4,000 in the first year. The machine will then begin to wear out so that the savings decline at a rate of 1 %1% per year forever. What is the present value of the savings if the interest rate is 9 %9% per year?
Answer:
The present value of the savings=$37,064.22
Explanation:
The present value of the savings is the amount that it worths today, this would be done in two stages;
The first stage is to determined the present of the first cash savings as follows:
PV of the first payment = 4,000 × (1.09)^(-1)=3,669.72
Second step is to determine the present value of the declining perpetuity
PV of declining perpetuity. A perpetuity is the series of cash flow occurring for the foreseeable future of years.
A- 4,000, g-negative growth rate = 1%,
interest rate = 9%
PV in year 1 = 4,000× (1-0.09)/(0.09+0.01)
= 36,400
PV in year 0 = 36,400 × (1.09)^(-1) = 33,394.49
The present value of the savings = 33,394.49 + 3,669.72= 37,064.22
The present value of the savings=$37,064.22
When a standalone organization is created and owned by two or more parent companies together, the strategic alliance is referred to as a(n) _____.
Answer:
Joint venture
Explanation:
A joint venture is one where two or more parties agree to pool their resources together to accomplish a particular goal.
Each participant shares in the profit, loss, and cost associated with the business.
However the venture an entity that is independent of the participant's other business interest.
So when a standalone organization is created and owned by two or more parent companies together, it is called a joint venture
With an increase in product advertising of $50 million you expect to increase sales by 10,000 units. If unit grow margin is $4,800, will the additional advertising increase product contribution?
Answer:
Income will decrease by $2,000,000.
Explanation:
Giving the following information:
Advertising increase= $50,000,000
Units increase= 10,000 units
Unit contribution margin= $4,800
To calculate the total effect on income, we need to use the following formula:
Effect on income= total contribution margin - increase in fixed costs
Effect on income= 10,000*4,800 - 50,000,000
Effect on income= $2,000,000 decrease
Income will decrease by $2,000,000.
Parton and Sons is a law firm that uses activity-based costing. Classify these activities as value-added or non-value-added:
a. Taking appointments
b. Reception
c. Meeting with clients
d. Bookkeeping
e. Court time
f. Meeting with opposing attorneys
g. Billing
h. Advertising
Answer:
The answer is:
A - Non-value-added
B - Non-value-added
C- Value-added
D- Non-value-added
E - Value-added
F - Value-added
G - Non-value-added
H- Non-value-added
Explanation:
In activity-based costing, Non-value-added activities are activities that add costs to ones product without enhancing the value while value-added is a cost that enhance the quality of a product or service.
A - Non-value-added
B - Non-value-added
C- Value-added
D- Non-value-added
E - Value-added
F - Value-added
G - Non-value-added
H- Non-value-added
Crane Company has gathered the following information.
Units in beginning work in process 0
Units started into production37,300
Units in ending work in process8,200
Percent complete in ending work in process:
Conversion costs40%
Materials100%
Costs incurred:
Direct materials$78,330
Direct labor$66,500
Overhead$105,114
1. Compute equivalent units of production for materials and for conversion costs.
Materials
Conversion Costs
The equivalent units of production
2. Determine the unit costs of production. (Round unit costs to 2 decimal places, e.g. 2.25.)
Materials
Conversion Costs
Unit costs
$
$
3. Show the assignment of costs to units transferred out and in process.
Units transferred out $
Units in ending work in process
Answer:
1. Compute equivalent units of production for materials and for conversion costs
Equivalent units of Materials: (Units in Beginning Work in process + Units started into production - Units in ending work in process) + Units in ending work in process
= (0 + 37,300 - 8,200) + 8,200
= 37,300
Equivalent units of conversion costs : (Units in Beginning Work in process + Units started into production - Units in ending work in process) + (Units in ending work in process * 40%)
= (0 + 37,300 - 8,200) + (8,200 * 40%)
=29,100 + 3,280
= 32,380
2. Determine the unit costs of production
Unit costs of materials = Direct materials / Equivalent units of Materials
= $78,330 / 37,300
= $2.1
Unit costs of conversion costs = (Direct labor + Overhead) / Equivalent units of conversion costs
= ($66,500 + $105,114) / 32,380
= $171,614 / 32,380
= $5.3
3. Show the assignment of costs to units transferred out and in process
Units ending work in process = Materials + Conversion costs
where, Materials = 8,200 * $2.1 = $8,202
Conversion costs = 3,281 * $5.3 = $17,389
( 8,200 * 40%)
Units ending work in process = $8,202 + $17,389
= $25,591
Gullett Corporation had $26,000 of raw materials on hand on November 1. During the month, the Corporation purchased an additional $75,000 of raw materials. The journal entry to record the purchase of raw materials would include a:
Answer:
debit to Raw Materials of $75,000
Explanation:
In this scenario, the journal entry to record the purchase of raw materials would include a debit to Raw Materials of $75,000. A debit is an entry recording a sum owed, listed on the left-hand side or column of an account. Therefore in accounting, since Gullet Corporation's purchase was for an "additional" $75,000 worth of raw material, they owe that money to the company and must make it up through sales that those materials should generate in the future. That is why it is recorded as a debit.
Kunkel Company makes two products and uses a conventional costing system in which a single plantwide predetermined overhead rate is computed based on direct labor-hours. Data for the two products for the upcoming year follow:
Mercon Wurcon
Direct materials cost per unit $ 9.00 $ 7.00
Direct labor cost per unit $15.00 $ 17.00
Direct labor-hours per unit 0.40 4.80
Number of units produced 4,000 8,000
These products are customized to some degree for specific customers.
Required:
1. The company's manufacturing overhead costs for the year are expected to be $1,600,000. Using the company's conventional costing system, compute the unit product costs for the two products.
2. Management is considering an activity-based costing system in which half of the overhead would continue to be allocated on the basis of direct labor-hours and half would be allocated on the basis of engineering design time. This time is expected to be distributed as follows during the upcoming year:
Mercon Wurcon Total
Engineering design time (in hours) 8,000 8,000 16,000
Compute the unit product costs for the two products using the proposed ABC system.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Mercon Wurcon
Direct materials cost per unit $ 9.00 $ 7.00
Direct labor cost per unit $15.00 $ 17.00
Direct labor-hours per unit 0.40 4.80
Number of units produced 4,000 8,000
A. First, we need to calculate the predetermined overhead rate:
Total direct labor hours= 0.4*4,000 + 4.8*8,000= 40,000
Overhead= 1,600,000
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 1,600,000/40,000
Predetermined manufacturing overhead rate= $40 per direct labor hour
Now, we can determine the unitary product cost.
Mercon= 9 + 15 + 40*0.4= $37
Wurcon= 7 + 17 + 4.8*40= $216
B.
Mercon Wurcon Total
Engineering design time (in hours) 8,000 8,000 16,000
Now, we have two different allocation rates:
Direct-labor hours= 800,000/40,000= $20 per direct labor hour
Engineer desing= 800,000/16,000= $50 per engineer desing hour
Finally, we can determine the unitary product cost:
Engineer design per unit:
Mercon= 8,000/4,000= 2
Wurcon= 8,000/8,000= 1
Mercon= 9 + 15 + (20*0.4 + 50*2) = $132
Wurcon= 7 + 17 + (20*4.8 + 50*1)= $170
Production and Purchases Budgets At the beginning of October, Comfy Cushions had 2,600 cushions and 15,500 pounds of raw materials on hand. Budgeted sales for the next three months are: Month Sales October 13,000 cushions November 15,000 cushions December 18,000 cushions Comfy Cushions wants to have sufficient raw materials on hand at the end of each month to meet 25 percent of the following month's production requirements and sufficient cushions on hand at the end of each month to meet 20 percent of the following month's budgeted sales. Five pounds of raw materials, at a standard cost of $0.90 per pound, are required to produce each cushion. Required a. Prepare a production budget for October and November. Do not use a negative sign with your answers.
Answer:
Production budget for October and November
October November
cushions cushions
Budgeted Sales 13,000 15,000
Add Budgeted Closing Inventory 3,000 3,600
Total Production needed 16,000 18,600
Less Budgeted Opening Inventory (2,600) (3,000)
Production Budget 13,400 15,600
Explanation:
A Production Budget shows the quantities of finished goods that must be produced to meet expected sales plus any increase in inventory levels that might be required.
Activity-based costing for a service company
Crosswinds Hospital plans to use activity-based costing to assign hospital indirect costs to the care of patients. The hospital has identified the following activities and activity rates for the hospital indirect costs:
Activity Activity Rate
Room and meals $240 per day
Radiology $215 per image
Pharmacy $50 per physician order
Chemistry lab $80 per test
Operating room $1,000 per operating room hour
The activity usage information associated with the two patients is as follows:
Patient Putin Patient Umit
Number of days 6 days 4 days
Number of images 4 images 3 images
Number of physician orders 6 orders 2 orders
Number of tests 5 tests 4 tests
Number of operating room hours8 hours 4 hours
Complete the Activity Table:
A. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns.
B. Use the activity rates in (A) to determine the total and per-unit activity costs associated with patient.
Answer:
A.
Room and meals= $240 per day
Radiology = $215 per image
Pharmacy = $50 per physician order
Chemistry lab = $80 per test
Operating room = $1,000 per operating room hour
B.
Patient Putin
Unit = $1,585
Total = $10,640
Patient Umit
Unit = $1,585
Total = $6,025
Explanation:
Activity rate = Total Overhead Cost / Total Activity
Room and meals= $240 per day
Radiology = $215 per image
Pharmacy = $50 per physician order
Chemistry lab = $80 per test
Operating room = $1,000 per operating room hour
Patient Putin
Unit Total
Room and meals $240 $1,440
Radiology $215 $860
Pharmacy $50 $300
Chemistry lab $80 $40
Operating room $1,000 $8,000
Total $1,585 $10,640
Patient Umit
Unit Total
Room and meals $240 $960
Radiology $215 $645
Pharmacy $50 $100
Chemistry lab $80 $320
Operating room $1,000 $4,000
Total $1,585 $6,025
Q3) At an output level of 45,000 units, you calculate that the degree of operating leverage is 2.79. If output rises to 48,000 units, what will the percentage change in operating cash flow be
Answer: 18.6%
Explanation:
Degree of operating leverage = % change in Operating cash flow / % change in output
% change in Output
= [tex]\frac{48,000 - 45,000}{45,000}[/tex]
= 6.7%
Degree of operating leverage = % change in Operating cash flow / % change in output
2.79 = % change in Operating cash flow/ 6.7%
% change in Operating cash flow = 2.79 * 6.7%
% change in Operating cash flow = 18.6%
An investment earns 35% the first year, earns 40% the second year, and loses 37% the third year. The total compound return over the 3 years was ______. Multiple Choice 158.93% 19.07% 38.00% 6.36%
Answer:
19.07%
Explanation:
The computation of the total compound return over the 3 years is shown below:
= (1 + investment percentage earned in first year) × (1 + investment percentage earned in second year) × (1 + investment percentage loss in second year)
= (1 + 0.35) × (1 + 0.40) × (1 - 0.37)
= 1.35 × 1.40 × 0.63
= 1.1907
= 19.07%
Sales 22160 units Cash, beginning balance $34000 Selling and administrative (of which depreciation, $5,000) $53000 Required minimum cash balance $66480 If necessary, the company will borrow cash from a bank on the first day of March. Assume that the borrowing can be made in any (exact) amount, but bears interest at 3% per month. The March interest will be paid during subsequent months. Q: What is the closest amount of cash that must be borrowed on March 1 to cover all cash disbursements and to obtain the desired March 31 cash balance
Answer:
Loan taken: 58,320
Explanation:
We add up the beginning cash with the receipts and subtract the expenses.
Then, we compare agaisnt the mnimum required balance
Beginning Cash 34,000
Cash Receipts
Sales 22,160
Total cash form operations: 56,160
Cash disbursements
S&A expense (w/o depreciations) 48,000
Ending Cash from operations 8,160
Minimum Balance: 66,480
Loan taken: 58,320
The marketing department of a reputable firm wants to improve strategic decision making, track the actions of other players in the market, and provide early warning of opportunities and threats. Which of the following would help the firm achieve its objectives?
A) Data warehousing
B) strategic planning competitive marketing intelligence
D) customer relationship management
E) ethnographic research
Answer:
The answer is C. competitive marketing intelligence
Explanation:
Competitive marketing intelligence may be a powerful research-based method employed by a company to collect, analyze, and use information collected on competitors, economic conditions, customers etc to a achieve business's competitive advantage.
The information-gathering analysis process can help a corporation develop its strategy or identify competitive gaps. It identifies threats and opportunities within the business
Larry Jones gifts land to a school district, but the deed states "for so long as the land is used for a school." Jones owns a(n):
Answer:
Reversionary interest
Explanation:
If Larry Jones gifts land to a school district, but the deed states "for so long as the land is used for a school." Jones owns a reversionary interest.
A reversionary interest can be defined as a property law (deed) which states that when a property such as a land transfer is used on a clause; “for so long as” or “on condition that."
Hence, once the interest of the benefactor comes to an end, the property reverts back to its original owner (grantor). It also gives the grantor's next of kin, successor or heir the power or right to take the property back in the future if promises are broken or the agreement comes to an end.
This ultimately implies that, if a property stated in the deed is not used or used, for certain purposes.
In this scenario, Larry owns a reversionary interest because he gifts a land to the school district, but in the deed he stated "for so long as the land is used for a school."
Smiling Elephant, Inc., has an issue of preferred stock outstanding that pays a $6.10 dividend every year, in perpetuity. If this issue currently sells for $80.65 per share, what is the required return?
Answer:
7.56%
Explanation:
Calculation for the required return for Smiling Elephant
Using this formula
Required return =D/P0
Where,
D=$6.10
P0=$80.65
Let plug in the formula
Required return =$6.10/$80.65
Required return =0.0756×100
Required return =7.56%
Therefore the Required return for Smiling Elephant Inc will be 7.56%
Abburi Company's manufacturing overhead is 55% of its total conversion costs. If direct labor is $45,900 and if direct materials are $27,200, the manufacturing overhead is:
Answer:
Manufacturing Overheads = $56100
Explanation:
The conversion cost defined simply is the cost involved in turning the raw material or direct material into the finished products. Conversion cost is calculated by adding the direct labor cost and the manufacturing overhead cost.
Conversion cost = Direct labor + Manufacturing overheads
As we know that the manufacturing overhead is 55% of conversion cost, then the direct labor cost is 45% of conversion cost.
If 45% of conversion cost is $45900, then the total conversion cost will be,
Conversion cost = 45900 * 100/45 = $102000
Manufacturing Overheads = 102000 - 45900 = $56100
Bendel Incorporated has an operating leverage of 7.3. If the company's sales volume increases by 3%, its net operating income should increase by about:
Answer:
21.9%
Explanation:
Given that
Operating leverage = 7.3
Increase in sales = 3%
According to the given situation, the computation of net operating income is shown below:-
Increase in operating income = Operating leverage × Increase in sales
= 7.3 × 3 %
= 21.9%
Therefore for computing the increase in operating income we simply applied the above formula.
"An economy is based on three sectorsdashagriculture, manufacturing, and services. For each unit of output, agriculture requires inputs of 0.20 unit from agriculture, 0.40 unit from manufacturing, and 0.20 unit from services. For each unit of output, manufacturing requires inputs of 0.30 unit from agriculture, 0.20 unit from manufacturing, and 0.20 unit from services. For each unit of output, services requires 0.20 unit from agriculture, 0.30 unit from manufacturing, and 0.30 unit from services. Determine the production levels needed to satisfy a final demand of 0 units for agriculture, 40 units for manufacturing, and 0 units for services. The production level needed from the agricultural sector is 40.00 units."
Answer:
Required Production to fullfil a Demand for 40 industry units
Agriculture 54.4
Industry 83.2
Services 51.2
Explanation:
Input Agricuilture Industrial Service
Agriculture 0.2 0.3 0.2
Industrial 0.4 0.2 0.3
Service 0.2 0.2 0.3
We require X input to generate a demand of 0 agriculture 40 industry and 0 services
The previous matrix will be the input we solve for the output
Output Agricuilture Industrial Service
Agriculture 0.8 -0.7 -0.8
Industrial -0.6 0.8 -0.7
Service -0.8 -0.8 0.7
We now reverse the matrix using excel:
Output Agricuilture Industrial Service
Agriculture 2 1.36 0.96
Industrial 1 2.08 0.88
Service 1 1.28 2.08
Now we multiply this by our desired outcome of
0
40
0
Agriculture 54.4
Industry 83.2
Services 51.2
All of the following are assumptions facing opposing forces of reducing costs and adapting to local markets that international business people should be aware of except? Homogenous customer needs worldwide People around the world are willing to sacrifice preferences for lower prices and higher quality Economies of scale can be obtained in production and marketing through supplying worldwide Lowering international synergy and cost via the value chain matrix
Answer: Lowering international synergy and cost via the value chain matrix
Explanation:
Theodore Levitt came up with some assumptions facing opposing forces of reducing costs and adapting to local markets that international business people should be aware of which include;
On a global scale, customer needs are beginning to become homogeneous.People are willing to sacrifice their preferences for better quality products at a cheaper quality which gives Multinational Companies a chance to offer them better products than local producers due to their large sizes and Economies of scale.Having to supply the world can lead to Economies of scale in production and marketing due to the larger market.Lowering international synergy and cost via the value chain matrix is not one of the assumptions espoused by Theodore Levitt and so is the correct answer.
Consider a service company that provides carpet cleaning and uses straight-line depreciation. Classify the cost of the depreciation on the carpet cleaning machines.
a. Fixed
b. Indirect
Answer:
Both :
a. Fixed and,
b. Indirect
Explanation:
The depreciation expense on production machinery form part of the product or service cost.
The cost however, can not be traced to the product or service that is why it is an Indirect cost as opposed to the direct costs which can be traced directly on the product or service.
Straight line method charges a fixed amount of depreciation thus the depreciation is a fixed charge.
Wolverine Company financial statements included the effects of these errors: Reported Net Income for Year 1 was $20,000. Reported Net Income for Year 2 was $18,000. Indicate the error in 12/31/2 Retained Earnings:
Answer:
Net income year 2 = $21,300
Explanation:
I looked for the missing information and found this:
Year Depreciation overstated Prepaid expense omitted
1 $2,500 $2,000
2 $4,000 $2,700
If your question doesn't include the same values, just adjust the answer.
Year 2's net income = net income (year 2) + overstated depreciation (year 2) + omitted prepaid expenses (year 1) - omitted prepaid expenses (year 2) = $18,000 + $4,000 + $2,000 - $2,700 = $21,300
ohnson, LLC’s bonds have exhibited a substantial trading volume in the past few years. Its bonds would be referred to a
Answer:
Seasonal issue
Explanation:
The seasoned issue or seasonal issue is that issue which is made for extra securities held from the company i.e established and it considered those securities who are already traded in the secondary market. The bond which are outstanding and traded in the secondary markets is known as seasoned issued
Since in the question it is mentioned that there is a substantial trading volume in the past few years so this represents the seasoned issue
A buyer and a seller enter into a real estate sales contract. Under the contract's terms, the buyer will pay the seller $500 a month for 10 years. The seller will continue to hold legal title, while the buyer will live in the home and pay all real estate taxes, insurance premiums, and regular upkeep costs. What kind of contract do the buyer and seller have
Answer: Land Sales Contract
Explanation:
Land Sales contract are a way to buy a property for people who would otherwise be unable to buy one because they were unable to get a mortgage or are running low in funds.
It works by the buyer paying the seller a certain amount of money for a period of time according to an agreement. During this period of payment, the seller continues to hold the legal rights to the property and then passes it to the buyer when they are finished paying. In this scenario therefore, the seller effectively plays the role of a mortgage bank.
A company's flexible budget for 13,200 units of production showed sales, $54,120; variable costs, $21,120; and fixed costs, $18,000. The operating income expected if the company produces and sells 19,600 units is:
Answer:
Net income= $31,000
Explanation:
Giving the following information:
Production= 13,200
Sales= 54,120
Variable costs= $21,120
Fixed costs= $18,000
First, we need to calculate the unitary contribution margin:
Unitary contribution margin= total contribution margin/number of units
Unitary contribution margin= (54,120 - 21,120) / 13,200
Unitary contribution margin= $2.5
Now, for 19,600 units:
Total contribution margin= 2.5*19,600= 49,000
Fixed costs= (18,000)
Net income= 31,000
The Cell Inc., a microbiology research laboratory headquartered in the United States, has been losing money. The CEO decides to outsource some production to companies in developing countries. This decision to shift functions or processes to less developed countries is most likely due to their
Answer:
ghjkgg 9ycutzts5a64sts64d6ix74s
The decision of the Ceo of Cell Inc. microbilogy research laboratory to outsource some production in developing countries so that maximum output and fast deliveries can be expected to customers and also by the company can focus on various other factors affecting the business.
What is a research laboratory?The scientific lab where the experiments or products research are made so that new products can be made or existing can be replaced in chemical biological or physical aspects.
What is outsourcing?The practice which is done by an individual or an organization by using third party to carry their business activities like performing tasks giving services to customers etc.
What is third party?The company or an individual which comes in between two aspects and try to manage or solve the issue or give solutions
To know more about Outsourcing, click here
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The rate of return on the common stock of Lancaster Woolens is expected to be 18 percent in a boom economy, 8 percent in a normal economy, and only 2 percent in a recessionary economy. The probabilities of these economic states are 12 percent for a boom and 10 percent for a recession. What is the variance of the returns on this common stock
Answer:
Variance of the return on this common stock is 0.15%
Explanation:
Note: See the attached excel file for the calculation of the variance of the returns on this common stock.
Note that the probability of a normal economy can be obtained as follows:
Probability of normal economy = 100% - Probability of a boom - Probability of a recession = 100% - 12% - 10% = 78%
These probabilities are used in the attached excel file.
he financial manager at Starbuck Industries is considering an investment that requires an initial outlay of $24,000 and is expected to produce cash inflows of $1,000 at the end of year 1, $5,000 at the end of years 2 and 3, $14,000 at the end of year 4, $9,000 at the end of year 5, and $7,000 at the end of year 6. a. Select the time line option that represents the cash flows associated with Starbuck Industries' proposed investment. b. Which of the approaches—future value or present value—do financial managers rely on most often for decision making? Why?
Answer:
Please check the attached image for the timeline image.
present value. this is because in making the decision of whether to carry out a project, the decision is made at the beginning of of the project and not in the future. so it is important to determine the present value to know if the project is profitable and should be carried out.
Explanation:
Timeline is arranges a series of events in chronological order. cash inflows are recorded as positive while cash outflows have a negative sign in front of the amount.
present value is the sum of discounted cash flows