Answer:
1. Sell $7 billion worth of U.S. government bonds
2. Increase the required reserve ratio.
Explanation:
1. If the Fed wants to change the money supply in the economy, it can use the Money Multiplier to determine how much is it has to put in or take out of the economy to increase/decrease the Money supply to a certain level. The Money Multiplier is a figure that shows how much the money supply will increase/ decrease by as a result of an additional dollar put into or removed from the economy.
Formula is;
= 1/ Reserve Ratio
= 1 / 20%
= 5
Federal Reserve wants to decrease supply by $35 billion.
$35 billion = Amount of Bonds to sell * Multiplier
$35 billion = Amount of Bonds to sell * 5
Amount of Bonds to sell = 35/5
Amount of Bonds to sell = $7 billion worth of bonds
2. If the Fed wants instead to use the required reserve ratio to reduce money supply then it should increase the ratio. This way banks will have to keep more money in reserve instead of giving it out as loans. This reduced lending in the economy will lead to less money being created and hence a reduced money supply.
A $200 petty cash fund has cash of $20 and receipts of $177. The journal entry to replenish the account would include a credit to Group of answer choices Cash for $20 Cash Short and Over for $3 Petty Cash for $190 Cash for $180
Answer: Cash for $180
Explanation:
The Petty Cash balance should be at a certain level necessary to cover petty cash expenses of the company. In this case that amount is $200. $20 is already in cash in the account and so will need to be topped up to get to $200.
= 200 - 20
= $180
$180 will take the balance back to $200. The Cash account would be credited of this $200 and the Petty Cash would be debited.
you want to borrow $89000 from your local bank to buy a new sailboat. You can afford to make monthly payments of $1850, but no more. Assuming monthly compounding, what is the highest rate you can afford on a 60 month APR loan?
Answer:
9.06%
Explanation:
Given that :
The amount to be borrowed = $89000
Monthly payment PMT = $1850
Period = 60 month
The highest rate that can be afforded on the 60 month APR loan is determined by using the EXCEL Spreadsheet to compute the solution to this question. The spreadsheet screenshot can be seen below for better understanding.
The city of New Orleans has 200 advertising companies, 199 of which employ designers of normal ability at a salary of $100,000 a year. The companies that employ normal designers each collect $500,000 in revenue a year, which is just enough to ensure that each earns exactly a normal profit. The 200th company, however, employs Janus Jacobs, an unusually talented designer. Because of Jacobs's talent, this company collects $1,000,000 in revenue a year.
Required:
a. How much will Jacobs earn?
b. What proportion of his annual salary will be economic rent?
c. Will the advertising company for which Jacobs works be able to earn an economic profit?
Answer:
a. Jacob should earn= $100,000 + ($1,000,000 - $500,000)
= $100,000 + $500,000
=$600,000
Hence, Jacob earns $600,000
b. The economic rent is the amount by which payment of Jacob(600,000) exceed the reservation price of the supplier(100,000)
Thus, the economic rent = 600,000 - 100,000 = $500,000
Proportion of Economic rent = Economy rent / Salary of jacob
= $500,000 / $600,000
= 5/6
Hence, the proportion of the economic rent of Jacob is salary is 5/6
c. The advertising company will not be able to make an economic profit because if they withhold some additional revenue made because of hiring Jacob, then he will switch to another advertising company at a higher salary and that company keep on making profit. The company should bid for Jacob until firm are indifferent on paying $600,000 or hiring someone else for $100,000 . Thus, the bidding of Jacob will continue until the salary of Jacob has bid up to a level where no company can make economic profits
Peter has opened a retirement investment account and plan to contribute $6,000 at the end of each year to his account for 30 years. He wants to retire when he has $1 million in the account. What expected annual rate of return must earn to have $1 million in his account?
Answer:
1.92
Explanation:
Using the compound interest formula
A= P [ (1-i)^n-1 (where A= 1,000,000, P= 6000, i= ?, n= 30)
1000000 = 6000 [ (1 - i)^30-1
1000000 = 6000 [ (1 - i)^29
1000000 = (6000 - 6000i)^29
1000000/6000 = (6000/6000 -6000i/6000)^29
= 166.66 = i^29
= 29✓166.66 = ✓i^29
= 1.92 = i
a. Galaxy Sales has sales of $746,700, cost of goods sold of $603,200, and inventory of $94,300. How long on average does it take the firm to sell its inventory
Answer:
days of inventory on hand if 360 days is used = 360 / 6.396607 = 56.28 days
days of inventory on hand if 365 days is used = 365 / 6.396607 = 57.06 days
Explanation:
We are to determine the days of inventory on hand
days of inventory on hand = number of days in a period / inventory turnover
inventory turnover = cost of goods sold / inventory - $603,200 / $94,300 = 6.396607
days of inventory on hand if 360 days is used = 360 / 6.396607 = 56.28 days
days of inventory on hand if 365 days is used = 365 / 6.396607 = 57.06 days
The production manager of Rordan Corporation has submitted the following quarterly production forecast for the upcoming fiscal year: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Units to be produced 10,600 8,500 7,000 11,100 Each unit requires 0.35 direct labor-hours, and direct laborers are paid $20.00 per hour. Required: 1. Prepare the company’s direct labor budget for the upcoming fiscal year.
Answer and Explanation:
The preparation of the direct labor budget is presented below:
Particulars Quarter 1 Quarter 2 Quarter 3 Quarter 4 Total
Required
Production 10,600 8,500 7,000 11,100 37,200
Multiply with
Direct labor
hours 0.35 0.35 0.35 0.35
Total
direct labors 3,710 2,975 2,450 3,885 13,020
Multiply with
Direct labor
cost $20 $20 $20 $20 $20
Total
direct labor
cost $74,200 $59,500 $49,000 $77,700 $260,400
Barnes Company uses a job order cost system. The following data summarize the operations related to production for October:
October 1 Materials purchased on account, $315,500.
2 Materials requisitioned, $290,100, of which $8,150 was for general factory use.
31 Factory labor used, $489,500, of which $34,200 was indirect.
31 Other costs incurred on account for factory overhead, $600,000; selling
expenses, $150,000; and administrative expenses, $100,000.
31 Prepaid expenses expired for factory overhead were $18,000; for selling
expenses, $6,000; and for administrative expenses, $5,000.
31 Depreciation of office building was $30,000; of office equipment, $7,500;
and of factory equipment, $60,000.
31 Factory overhead costs applied to jobs, $711,600.
31 Jobs completed, $1,425,000.
31 Cost of goods sold, $1,380,000.
Required:
Journalize the entries to record the summarized operations.
Answer:
October 1
Raw Materials Inventory $315,500 (debit)
Accounts Payable $315,500 (credit)
October 2
Work In Process : Direct Materials $281,950 (debit)
Work In Process : Indirect Materials $8,150 (debit)
Raw Materials $290,100 (credit)
October 31
Work In Process : Direct Labor $455,300 (debit)
Work In Process : Indirect Labor $34,200(debit)
Salaries Payable $489,500 (credit)
October 31
Work In Process : Factory Overhead $600,000 (debit);
Selling expenses $150,000 (debit)
Administrative expenses, $100,000 (debit)
Accounts Payable $850,000 (credit)
October 31
Factory Overhead $18,000 (debit);
Selling Expenses, $6,000 (debit)
Administrative expenses, $5,000 (debit)
Prepaid Factory Overhead were $18,000 (credit);
Prepaid Selling Expenses, $6,000 (credit)
Prepaid Administrative expenses, $5,000 (credit)
October 31
Depreciation : office building $30,000 (debit)
Depreciation : office equipment, $7,500 (debit)
Work In Process - Depreciation : factory equipment, $60,000 (debit)
Accumulated Depreciation : Buildings $30,000 (credit)
Accumulated Depreciation : Equipment $67,500 (credit)
October 31
Work In Process : Factory Overheads $711,600 (debit)
Factory Overheads $711,600 (credit)
October 31
Finished Good $1,425,000 (debit)
Work In Process Account $1,425,000 (credit)
October 31
Cost of Goods Sold $1,380,000 (debit)
Finished Goods $1,380,000 (credit)
Explanation:
Manufacturing Costs are accumulated in the Work In Process Account.
When Jobs are completed, De-recognize the cost of jobs completed from Work In Process Account into the Finished Goods Account.
When Jobs are Sold, De-recognize the cost of jobs sold from the Finished Goods Account into the Trading Account.
On January 1, 20X7, Server Company purchased a machine with an expected economic life of five years. On January 1, 20X9, Server sold the machine to Patron Corporation and recorded the following entry:
Cash 45,000
Accumulated Depreciation 28,000
Machine 70,000
Gain on Sale of Equipment 3,000
Patron Corporation holds 75 percent of Server's voting shares. Server reported net income of $50,000, and Patron reported income from its own operations of $100,000 for 20X9. There is no change in the estimated economic life of the equipment as a result of the intercorporate transfer. Based on the preceding information, in the preparation of the 20X9 consolidated income statement, machine will be what amount and will it be debited or credited in the consolidation entry?
Answer:
Consolidation entry is given below
Explanation:
Consolidated Entry DEBIT CREDIT
Machinery(w) $42,000
Loss on purchase $3,000
Cash $45,000
NOTE: We will record a loss in consolidation entry because the consideration paid is greater than the machinery's carrying value.
Working
Carrying value = Net book value - Accumulated Depreciation
Carrying value = $70,000 - $28,000
Carrying value = $42,000
A company estimates that warranty expense will be 4% of sales. The company's sales for the current period are $185,000. The current period's entry to record the warranty expense is:
The journal entry for recording the warranty expense is
Dr Warranty Expense 7,400
Cr Estimated Warranty Liability 7,400
Journal entry:Dr Warranty Expense 7,400 (185,000 x 0.04)
Cr Estimated Warranty Liability 7,400
(being warranty expense is recorded)
here expense is debited as it increased the expense and liability should be credited as it also increased the liability.
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The entry for the warranty expense would be recorded in the form of the Journal entry by debiting the Warranty Expense and crediting the Estimated Warranty Liability with the amount of $7,400.
What is the Journal entry?Journal entry is defined as the primary books of accounting, it records the financial transactions of the firm as a form of recording the transaction by applying the golden rules of accounting.
This process of recording involves of transactions by giving the debit as well as credit effect of the transaction in such a manner that the transactions are recorded properly.
The Journal entry of the given case is:
Warranty Expense a/c Dr. $7,400
To Estimated Warranty Liability a/c $7,400
(being warranty expense is recorded)
The amount is calculated as:
185,000 × 0.04 = $7,400
Therefore, both the accounts are recorded with the $7,400.
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Tri Fecta, a partnership, had revenues of $373,000 in its first year of operations. The partnership has not collected on $45,200 of its sales and still owes $38,700 on $170,000 of merchandise it purchased. There was no inventory on hand at the end of the year. The partnership paid $27,100 in salaries. The partners invested $41,000 in the business and $25,000 was borrowed on a five-year note. The partnership paid $2,250 in interest that was the amount owed for the year and paid $8,000 for a two-year insurance policy on the first day of business. Ignore income taxes. Compute the cash balance at the end of the first year for Tri Fecta.
Answer:
Cash balance = $225,150
Explanation:
Cash balance can be calculated by calculating the difference of cash inflows and cash outflows
Cash inflow
Investment $41,000
Borrowed $25,000
Cash collection(w) $327,800
Total Collection $393,800
Less:
Cash outflow
Merchandise(w) $131,300
Salaries paid $27,100
Interest paid $2,250
Insurance paid $8,000
Total cash paid $168,650
Cash Balance = Total Collection - Total Cash paid
Cash balance = $393,800 - $168,650
Cash balance = $225,150
Working
Cash collection = The partnership has not collected on $45,200 of its sales
Cash collection = Sales - 45,200
Cash collection = $373,000 - $45,200
Cash collection = $327,800
Merchandise = Tri Fecta still owes $38,700 on $170,000 of merchandise it purchased
Merchandise = $170,000 - $38,700
Merchandise = $131,300
Blossom Company issued 3,000 shares of common stock. Prepare the entry for the issuance under the following assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually. Round answers to 0 decimal places, e.g. 5,675. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.) (a) The stock had a par value of $9.25 per share and was issued for a total of $51,500. (b) The stock had a stated value of $9.25 per share and was issued for a total of $51,500. (c) The stock had no par or stated value and was issued for a total of $51,500. (d) The stock had a par value of $9.25 per share and was issued to attorneys for services during incorporation valued at $51,500. (e) The stock had a par value of $9.25 per share and was issued for land worth $51,500.
Answer:
Blossom Company
Issue of 3,000 Common Stock Shares on the following assumptions:
(a) The stock had a par value of $9.25 per share and was issued for a total of $51,500:
Debit Cash Account $51,500
Credit Common Stock $27,750
Credit Paid-in In Excess of Par $23,750
To record the issue of 3,000 shares of $9.25 par value.
(b) The stock had a stated value of $9.25 per share and was issued for a total of $51,500:
Debit Cash Account $51,500
Credit Common Stock $27,750
Credit Additional Paid-in Capital $23,750
To record the issue of 3,000 shares of $9.25 stated value.
(c) The stock had no par or stated value and was issued for a total of $51,500:
Debit Cash Account $51,500
Credit Common Stock $51,500
To record the issue of 3,000 shares.
(d) The stock had a par value of $9.25 per share and was issued to attorneys for services during incorporation valued at $51,500:
Debit Incorporation Cost (Attorneys Fees) $51,500
Credit Common Stock $51,500
To record the issue of 3,000 shares for attorneys' services
(e) The stock had a par value of $9.25 per share and was issued for land worth $51,500.
Debit Land $51,500
Credit Common Stock $51,500
To record the issue of 3,000 shares for land.
Explanation:
Shares of Blossom Company can be issued to settle debts or expenses or in exchange for other assets than cash. They can also be issued at par value, above par value, or below par value, depending on prevailing circumstances. Some shares have a par value, which is the nominal value of the shares as authorized. Some are issued at a stated value without par. Others have no par or stated values. Their different accounting treatments are indicated above for Blossom Company.
Suppose a ten firm industry has total sales of $35 million per year. The largest firm have sales of $10 million, the third largest firm has sales of $4 million, and the fourth largest firm has sales of $2 million. If fifth through tenth largest firms combined have annual sales of $12 million, the fourfirm concentration ratio for this industry is
Answer:
0.66
Explanation:
the fourfirm concentration ratio is the sum of the concentration ratio of the four largest firms in the industry.
The sales of the second largest firm = $35 million - ( $10 million + $4 million+ $2 million + $12 million ) = $7 million
concentration ratio of firm 1 = $10 million / $35 million = 0.29
concentration ratio of firm 2 = $7 million / $35 million = 0.2
concentration ratio of firm 3 = $4 million / $35 million = 0.11
concentration ratio of firm 4 = $2 million / $35 million = 0.06
Adding the ratios together = 0.66
g If the Fed is concerned about a possible recession, it ________ the federal funds rate and, in response, longterm interest rates ________ by a ________ amount than the change in shortterm rates. A. lowers; increase; smaller B. lowers; decrease; smaller C. raises; decrease; larger D. raises; increase; smaller E. raises; increase; larger
Answer:
The Fed
Concern about possible recession:
E. raises; increase; larger
Explanation:
The federal funds rate is a short-term monetary policy tool that the Federal Reserve deploys to control expansionary or recessionary economic conditions. It is the interest rate that Federal Reserve allows banks with excess to charge other banks that need to borrow to shore up their deficits. This interest rate is a short-term rate when compared to the long-term interest rates that banks charge consumers of its products and services. The long-term interest rates are affected by the inflation rates.
A corporate bond pays 3% of its face value once per year. If this $4 comma 000 10-year bond sells now for $4 comma 450, what yield will be earned on this bond? Assume the bond will be redeemed at the end of 10 years for $4 comma 000.
Answer:
The answer is 1.76%
Explanation:
N(Number of periods) = 10 years
I/Y(Yield to maturity) = ?
PV(present value or market price) = $4,450
PMT( coupon payment) = $120 (7 percent x $4,000)
FV( Future value or par value) = $4,000.
We are using a Financial calculator for this.
N= 10; PV = -4,450; PMT = 120; FV= 4,000;
CPT I/Y= 1.76
Therefore, the Yield-to-maturity of the bond is bond is 1.76%
Don Wyatt is unable to reconcile the bank balance at January 31. Don?s reconciliation is as follows.
Cash balance per bank $3,800.20
Add: NSF check 570.00
Less: Bank service charge 35.00
Adjusted balance per bank $4,335.20
Cash balance per books $4,115.20
Less: Deposits in transit 650.00
Add: Outstanding checks 940.00
Adjusted balance per books $4,405.20
Prepare a correct bank reconciliation.
Answer and Explanation:
The preparation of the correct bank reconciliation is presented below:
Don Wyatt
Bank reconciliation statement
January 31
Particulars Amount Particulars Amount
Bank cash balance $3,800.20 Company cash balance $4,115.20
Deposits in transit $650 Less: NSF check -$570
Less: Outstanding Less: service fee -$35
Check -$940
Bank balance Company balance
After reconciliation $3,510.20 After reconciliation $3,510.20
We adjust the transactions according to the bank balance and book balance so that the both balance could be matched accordingly
Bookmark question for later Cross-training workers does the following for your workers a. creates a sense of achievement and job satisfaction b. workers take pride as they help their companies compete through higher productivity c. helps reduce turnover d. all of the above e. only a and b
Answer:
d. all of the above
Explanation:
Cross-training applies to workers, who are trained for different spectrum other than their job responsibilities.
Cross-training workers are multitasking and do the following tasks:
They helps other employees to appreciate each other’s jobs.They help companies through higher efficiency & productivity and are proud of that. Cross-training forces also helps in reducing the turnover to gain more profit.So, Cross-training workers helps to train other employees to perform new tasks in addition to their usual duties and the correct option is "d".
Pandora pioneered a new way to broadcast music. This kind of breakthrough of creating ________ ways to solve old problems or meeting customer needs in a ___________ new way is referred to as a pioneering new entry.
Answer:new; unique
Explanation:
Pioneering new entry is when a firm brings a new product into the market which in turn, changes the way in which businesses will be conducted.
In situations whereby the product is unique, then the pioneering firm may end up having little direct competition. Pioneering new entry is somehow risky as the product or service may not be accepted.
Which of the following provisions, if included in a mandatory arbitration agreement, would not likely render it unenforceable?
A. A provision that the employee pay the costs of the arbitrator’s services.
B. A provision that gives the employer the right to choose any arbitrator.
C. A provision that requires the employee to prove his case.
D. All of the above.
Answer:
C. a provision that requires the employee to prove his case.
Explanation:
Arbitration is a form of resolving dispute outside of the court system. Here, the parties involved agrees to have their dispute settled through a third party other than a judge. Mandatory arbitration is a provision that is included in a contract , which requires concerned parties to resolve their contract dispute before an arbitrator instead of the normal court system.
In a situation where one of the parties to a contractual agreement feels cheated or the other party has not performed his term of the agreement, such may seek redress through an arbitrator. For a mandatory arbitration to be enforceable, there must be a provision that the employee pay the cost of the arbitrator's service and also a provision that the employer has the right to choose any arbitrator.
Use the information provided below to answer the following question (same for set of 5 questions). Nash began April with accounts receivable of $49,000 and a credit balance in Allowance for Uncollectible Accounts of $1,000. They made $500,000 in credit sales (sales on account) during April. Collections from customers totaled $493,003. One customer, frank Jones, could not pay his $1, 200 account receivable. On April 7, he negotiated to exchange his past-due account for a $1, 200, 4%, 90-day note receivable. Historically, 1% of credit sales have prove uncollectible. During April, 3375 of old accounts receivable were written off as uncollectible.
The necessary adjusting entry at April 30 would include:
a) Debit to Interest Receivable, $11, 84
b) Credit to Interest Payable, $48.00
c) Debit to Note Receivable, $3.02
d) Credit to Interest Revenue, $3.02
e) Both C and D.
Answer:
d) Credit to Interest Revenue, $3.02
Explanation:
beginning balance of accounts receivable $49,000
allowance for doubtful accounts $1,000
net credit sales $500,000
collections on accounts receivable $493,003
$6,997
Frank Jones:
Dr Notes receivable 1,200
Cr Accounts receivable 1,200
Write offs:
Dr Allowance for doubtful accounts 3,375
Cr Accounts receivable 3,375
the adjusting entry in this question refers to the notes payable from frank Jones:
we must determine the interest revenue for the month of April = $1,200 x 0.04 x (23 days/365 days) = $3.02
the journal entry should be:
April 30, accrued interest from notes receivable
Dr Interest receivable 3.02
Cr Interest revenue 3.02 ⇒ OPTION D
direct materials $34, direct labor $27, variable manufacturing overhead $15, fixed manufacturing overhead $43, variable selling and administrative expenses $20, and fixed selling and administrative expenses $28. Its desired ROI per unit is $31. Compute the markup percentage using absorption-cost pricing.
Answer:
Mark- up = 26.05%
Explanation:
Absorption costing is method of costing where overheads are charged to units produced using volume-based bases. e.g machine hours, labour hours e.t.c. Units are valued using full cost per unit
Full cost per unit= Direct material cost + direct labor cost + variable manufacturing overhead + fixed manufacturing overhead
Note that the selling and administrative expenses are period cost which are not to be considered as production cost, hence they are excluded.
Full cost per unit= 34 + 27 +15 +43 = 119
ROI per unit/profit per unit = 31
Mark- up under absorption costing is profit expressed as a percentage of of the full cost.
Mark- up = 31/119 × 100 = 26.05%
Mark- up = 26.05%
Power Manufacturing recorded operating data for its shoe division for the year. Sales $1,500,000 Contribution margin 300,000 Controllable fixed costs 180,000 Average total operating assets 600,000 How much is controllable margin for the year
Answer:
Controllable margin for the year is $120,000.
Explanation:
Controllable margin refers to contribution margin minus controllable fixed costs. Controllable margin is usually employed to assess the performance of managers because all the costs that the profit center manager can control are included in the calculation of controllable margin.
Based on the explanation above, controllable margin for this question can therefore be calculated as follows:
Controllable margin = Contribution margin - Controllable fixed costs = $300,000 - $180,000 = $120,000
Therefore, controllable margin for the year is $120,000.
The Pennington Corporation issued a new series of bonds on January 1, 1985. The bonds were sold at par ($1,000); had a 12% coupon; and mature in 30 years, on December 31, 2014. Coupon payments are made semiannually (on June 30 and December 31). a. What was the YTM on January 1, 1985?
Answer:
The YTM on January 1, 1985 was 6.00%.
Explanation:
The YTM is the interest rate used to determine the Present Value of Coupons and Principle and can be found as follows :
PV = $1,000
Pmt = ($1,000 × 12 %) / 2 = - $60
P/yr = 1
n = 30 × 2 = 60
Fv = - $1,000
YTM = ?
Using a Financial Calculator, the YTM is 6.00%
Therefore, the YTM on January 1, 1985 was 6.00%.
Target ROI is 19% Invested Capital is $569,512 Full Cost per unit $1,124 Expected sales volume is 959 units. If the company prices each unit to earn the target ROI, what amount of profit would be added to the cost of each unit?
Answer:
The amount of profit to be added to the cost of each unit = $112.83
Explanation:
Profit is the difference between the selling price per unit and full cost per unit. To determine the the amount of profit to be added , we will divide the total return on invested capital by the number of units to be produced and sold. This is given below as follows:
Target return = ROI (%) × Invested capital
= 19% × 569,512 = 108,207.28
Profit per unit = Total return/Number of units
= $108,207.28 /959 units
= $112.83 per unit
Selling price per unit = Full cost per unit + profit per unit
= 1,124 + 112.83 = 1,237.66 (this is not required anyway)
The amount of profit to be added to the cost of each unit = $112.83
The amount of profit that would be added to the cost of each unit is $112.83 that should be come after calculating the target return.
Calculation of the amount of profit:Before that the following calculations need to be done
Target return = ROI (%) × Invested capital
= 19% × 569,512
= 108,207.28
Now
Profit per unit = Total return/Number of units
= $108,207.28 /959 units
= $112.83 per unit
hence, The amount of profit that would be added to the cost of each unit is $112.83.
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The Juarez family is looking for a new cable company. After conducting research, they decide on a new cable provider. They call the new cable provider and mention they are going to switch from another provider. The salesperson at the new cable provider congratulates the Juarez family and lets them know that the new provider has been rated the highest in customer satisfaction in the industry. The salesperson tells them that if they sign up today for cable service, he will offer them a great monthly rate plus a free three-month trial of ten premium channels that they can cancel at any time. The Juarez family likes what they hear, and they sign up for the service. The salesperson has used which type of IMC marketing materials to close the sale?
The correct answer to this open question is the following.
Although there are no options provided, we can say the following.
The IMC marketing material to close the sale was the personal selling tool, using persuasion, and highlighting the benefits of the service to close the sale.
We are talking about Integrated Marketing Communications that include different disciplines such as Public Relations, Promotions, Sales, or Advertising. These resources are used by companies to plan and implement programs aimed to offer their products and services and closing the sale, relying on good customer service. Most of the modern campaigns include IMC to support the marketing effort.
Multiple Product Performance Report Storage Products manufactures two models of DVD storage cases: regular and deluxe. Presented is standard cost information for each model:
Cost Components Regular Deluxe
Direct materials
Lumber 2 board feet × $3 = $6.00 3 board feet × $3 = $9.00
Assembly kit = 2.00 = 2.00
Direct labor 1 hour × $4 = 4.00 1.25 hours × $4 = 5.00
Variable overhead 1 labor hr. × $2 = 2.00 1.25 labor hrs. × $2 = 2.50
Total $14.00 $18.50
Budgeted fixed manufacturing overhead is $13,000 per month. During July, the company produced 5,000 regular and 2,000 deluxe storage cases while incurring the following manufacturing costs:
Direct materials $70,000
Direct labor 31,000
Variable overhead 11,500
Fixed overhead 15,500
Total $128,000
Prepare a flexible budget performance report for the July manufacturing activities.
Answer:
Flexible budget performance report for the July manufacturing activities
Direct Materials : $62,000
Lumber :
Regular ($6.00 × 5,000) $30,000
Deluxe ($9.00 × 2,000) $18,000
Assembly kit :
Regular ($2.00 × 5,000) $10,000
Deluxe ($2.00 × 2,000) $4,000
Labor : $30,000
Regular ($4.00 × 5,000) $20,000
Deluxe ($5.00 × 2,000) $10,000
Variable overhead : $15,000
Regular ($2.00 × 5,000) $10,000
Deluxe ($2.50 × 2,000) $5,000
Fixed manufacturing overhead $13,000
Total $120,000
Explanation:
A Flexed Budget is a Master budget that has been adjusted to reflect the Actual Level of Operation.
On July 9, Mifflin Company receives a $10,400, 90-day, 8% note from customer Payton Summers as payment on account. What entry should be made on July 9 to record receipt of the note
Answer: Debit Notes Receivable $10,400; credit Accounts Receivable $10,400.
Explanation:
Mifflin Company is receiving the note back from Payton Summers which means that Payton Summers intends to settle their account. The correct entry to record therefore is one that closes off the Notes Receivable account by debiting it as it was on a credit balance.
The other account would be the Accounts Receivable account which would need to be credited by the amount owed to close off the account as it was on a debit balance as Accounts Receivables are when customers are still owing.
Beverages, Ltd., of Fiji uses the weighted-average method in its process costing system. It makes blended tropical fruit drinks in two stages. Fruit juices are extracted from fresh fruits and then blended in the Blending Department. The blended juices are then bottled and packed for shipping in the Bottling Department. The following information pertains to the operations of the Blending Department for June Percent Completed Units Materials Conversion Work in process, beginning Started into production Completed and transferred out Work in process, ending 58,000 299,000 289,000 68,000 70% 40% 75 % 25% Work in process, beginnin Cost added during June Materials Conversion $ 20,0006,200 $214,600 131,500
Required
1. Calculate the Blending Department's equivalent units of production for materials and conversion in June
2. Calculate the Blending Department's cost per equivalent unit for materials and conversion in June
3. Calculate the Blending Department's cost of ending work in process inventory for materials, conversion, and in total for June
4. Calculate the Blending Department's cost of units transferred out to the Bottling Department for materials, conversion, and in total for June
5. Prepare a cost reconciliation report for the Blending Department for June
Answer:
Explanation:
1
Units %Material
Units completed & Transferred 289,000 100 289,000
Units of ending WIP 68,000 75 51,000
Equivalent units of production 340,000
% Conversion EUP Conversion
Units completed & transferred out 100 289,000
Units of ending WIP 25 17,000
Equivalent units of production 306,000
2
Material Conversion
Beginning WIP 20,000 6,200
Added cost in June 214,600 131,500
Total 234,600 137,700
Equivalent unit of production 340,000 306,000
Cost /equivalent unit 0.69 0.45
3
EUP Cost/ EUP Total
Material 51,000 0.69 35,190
Conversion 17,000 0.45 7,650
Total cost of ending WIP 42,840
for materials ,conversion
4
EUP Cost / EUP Total
Material 289,000 0.69 199,410
Conversion 289,000 0.45 130,050
Total cost of units transferred out 329,460
5
Reconciliation report
Cost of beginning WIP 20,000 6,200 26,200
Cost added in the month 214,600 131,500 346,100
Total 372,300
Cost of units transferred out 329,460
Cost of ending WIP 42,840
Total 372,300
When an individual taxpayer sells depreciable real property at a gain, the lesser of the accumulated depreciation or the recognized gain is taxed at a maximum rate of
Answer:
25%.
Explanation:
When you consider that, Depreciation recapture is a term that describes the actual gain derived from after selling depreciable capital property. It is assessed when the sale price of an asset exceeds the tax basis or adjusted cost basis.
Hence, in this case, the gain due to accumulated depreciation is taxed at a max 25%. However, If the recognized gain is higher than the accumulated depreciation, the remaining gain is taxed at at 0/15/20 %, depending on the taxpayer's income.
Stock Y has a beta of .9 and an expected return of 11.2 percent. Stock Z has a beta of .5 and an expected return of 7.2 percent. What would the risk-free rate have to be for the two stocks to be correctly priced
Answer:
Required risk free rate for two stocks to be correctly priced would be 2.20%.
Explanation:
In order to determine this, the Capital Asset Pricing Model (CAPM) formula is used as follows:
Rs = Rf + (Beta * MR) .................................... (1)
Where;
For Stock Y:
Rs = Expected return on stock = 11.2%, or 0.112
Rf = Risk free return = ?
Beta = 0.9
MR = Market risk premium = ?
Substituting the values into equation (1), we have:
0.112 = Rf + (0.9 * MR) ................................. (2)
For Stock Z:
Rs = Expected return on stock = 7.2%, or 0.072
Rf = Risk free return = ?
Beta = 0.5
MR = Market risk premium = ?
Substituting the values into equation (1), we have:
0.072 = Rf + (0.5 * MR) ................................. (3)
If we deduct equation (3) from equation (2) and solve for MR, we have:
(0.112 - 0.072) = (Rf - Rf) + (0.9MR - 0.5MR)
0.04 = 0 + 0.4MR
MR = 0.04 / 0.4
MR = 0.10, or 10%
Substituting MR = 0.01 into equation (2) and solve for Rf, we have:
0.112 = Rf + (0.9 * 0.10)
0.112 = Rf + 0.09
Rf = 0.112 - 0.09
Rf = 0.022, or 2.20%
Therefore, required risk free rate for two stocks to be correctly priced would be 2.20%.
One of your customers is delinquent on his accounts payable balance. You’ve mutually agreed to a repayment schedule of $500 per month. You will charge 1.2 percent per month interest on the overdue balance.
If the current balance is $11,000, how long will it take for the account to be paid off? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Answer:
It will take approximately 25.70 months for the the account to be paid off.
Explanation:
Assuming the customer pays at the end of every month, the relevant formula to use is therefore the formula for calculating the present value of an ordinary annuity as follows:
PV = P * [{1 - [1 / (1 + r)]^n} / r] …………………………………. (1)
Where;
PV = Present value or current balance = $11,000
P = Monthly repayment = $500
r = interest rate = 1.2%, or 0.012
n = number of months = ?
Substitute the values into equation (1) and solve for n, we have:
11,000 = 500 * [{1 - [1 / (1 + 0.012)]^n} / 0.012]
11,000 / 500 = {1 - [1 / (1 + 0.012)]^n} / 0.012
22 * 0.012 = 1 - 0.988142292490119^n
0.264 = 1 - 0.988142292490119^n
0.988142292490119^n = 1 - 0.264
0.988142292490119^n = 0.736
Loglinearizing both sides, we have:
n * log (0.988142292490119) = log (0.736)
n = log (0.736) / log (0.988142292490119)
n = -0.133122185662501 / -0.00518051250378013
n = 25.70
Therefore, it will take approximately 25.70 months for the the account to be paid off.