Answer:
The predetermined manufacturing overhead rate per direct labor hour is $3.75 per direct labor hour
Explanation:
Actual manufacturing overhead costs = $ 212,500
Actual direct labor hours = 54,900 hours
Actual direct labor costs = $ 445,000
Estimated manufacturing overhead costs = $210,000
Estimated direct labor hours = 56,000 hours
Predetermined Overhead Rate = Estimated manufacturing overhead costs ÷ Estimated direct labor hours
Predetermined Overhead Rate = $210,000 ÷ 56,000
Predetermined Overhead Rate = $3.75 per direct labor hour
At around 6 p.m., Joe, who manages the Spaghetti Restaurant, decided that it was a slow night and he sent home two of his waiters. At 6:30 p.m., the restaurant becomes very busy and the other employees are frustrated because orders are behind. However, Joe tells them that sending home the two waiters was the right decision and that the reason orders are behind is because they are distracted. This reflects ______.
a. sticking to what you believe in
b. controlling your decision
c. implementation of a decision
d. escalation of commitment
The journal entry to record the use of utilities in a factory could include which two of the following: (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)
A. Debit to Factory Overhead unanswered
B. Credit to Factory Overhead unanswered
C. Debit to Factory Utilities Payable unanswered
D. Credit to Factory Utilities Payable unanswered
E. Credit to Raw Materials unanswered
F. Credit to Factory Wages Payable unanswered
Answer:
The correct options are:
A. Debit to Factory Overhead
D. Credit to Factory Utilities Payable
Explanation:
The debit entry of the use of utilities in a factory would be recorded in factory overhead since cost of utilities is a not a direct factory cost.
However, the corresponding credit would be in the factory utilities payable as an obligation awaiting payment to be made to the supplier of the service being enjoyed by the factory in order to run on daily basis
Answer:
The correct options are:
A. Debit to Factory Overhead
D. Credit to Factory Utilities Payable
Explanation:
The debit entry of the use of utilities in a factory would be recorded in factory overhead since cost of utilities is a not a direct factory cost.
However, the corresponding credit would be in the factory utilities payable as an obligation awaiting payment to be made to the supplier of the service being enjoyed by the factory in order to run on daily basis
Laurel, Inc., and Hardy Corp. both have 6 percent coupon bonds outstanding, with semiannual interest payments, and both are currently priced at the par value of $1,000. The Laurel, Inc., bond has five years to maturity, whereas the Hardy Corp. bond has 18 years to maturity.
A. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds?
B. If interest rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of these bonds be then?
Answer:
A. If interest rates suddenly rise by 2 percent, what is the percentage change in the price of these bonds?
Laurel, Inc. = -8.11%
Hardy Corp. = -18.91%
B. If interest rates were to suddenly fall by 2 percent instead, what would the percentage change in the price of these bonds be then?
Laurel, Inc. = +8.98%
Hardy Corp. = +25.49%
Explanation:
bonds with 6% semiannual coupons, sold at par $1,000
Laurel, Inc. bond maturity in 5 years
Hardy Corp. bond maturity in 18 years
the current price of a bond is the sum of the present value of its face value and coupons. I will use an annuity table to calculate PV of face value and an ordinary annuity table for the coupons:
Laurel, Inc.
market rate 4% = ($1,000 x 0.8203) + ($30 x 8.9826) = $820.30 + $269.48 = $1,089.78, % change = 89.78/1,000 = 8.98%
market rate 8% = ($1,000 x 0.6756) + ($30 x 8.1109) = $675.60 + $243.33 = $918.93, % change = -81.07/1,000 = -8.11%
Hardy Corp.
market rate 4% = ($1,000 x 0.4902) + ($30 x 25.489) = $490.20 + $764.67 = $1,254.87, % change = 254.87/1,000 = 25.49%
market rate 8% = ($1,000 x 0.2437) + ($30 x 18.908) = $243.70 + $567.24 = $810.94, % change = -189.06/1,000 = -18.91%
If your uncle borrows $69,000 from the bank at 11 percent interest over the nine-year life of the loan. Use Appendix D for an approximate answer but calculate your final answer using the formula and financial calculator methods.
a. What equal annual payments must be made to discharge the loan, plus pay the bank its required rate of interest? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
b. How much of his first payment will be applied to interest? To principal? (Do not round intermediate calculations. Round your final answers to 2 decimal places.)
c. How much of his second payment will be applied to each? (Do not round intermediate calculations Round your final answers to 2 decimal places.)
Answer:
a. The annual payment to be made is $12,461.51
b. On first installment interest portion is $7,590 and principal portion is $4,871.51
c. The Interest portion in the second installemnt is $7,054.13 and Principal portion is $5,407.38.
Explanation:
a. According to the given data we have the following:
Loan Amount (Present Value) = $69,000.
Nper = 9 years
Rate = 11%.
Future value = 0
You would have to Compute annual payment using excel function as follows:
Pmt = Pmt(11%,9,-69000,0)
= $12,461.51.
Therefore, annual payment to be made is $12,461.51.
b. To calculate the amount of his first payment to be applied to interest and To principal we would have to make the following calculation:
Interest = $69,000*11% = 7,590.
Installement amount = 12,461.51.
Principal portion = 12,461.51-7590 = $4,871.51.
Therefore, On first installment interest portion is $7,590 and principal portion is $4,871.51.
c. To calculate How much of his second payment will be applied to each we would have to make the following calculations:
Principal Balance at the beginning of the second is $69,000 -$4871.51 = $64128.49.
Interest portion in the second installemnt = $64,128.49 * 11% = $7,054.13.
Principal portion = $12461.51-$7054.13 = $5,407.38.
Assume that banks do not hold excess reserves and that households do not hold currency, so the only form of money is demand deposits. To simplify the analysis, suppose the banking system has total reserves of $100. Determine the money multiplier and the money supply for each reserve requirement listed in the following table.
Reserve Requirement Simple Money Multiplier Money Supply
(Percent) (Dollars)
25
10
A lower reserve requirement is associated with a money supply.
Suppose the Federal Reserve wants to increase the money supply by $100. Again, you can assume that banks do not hold excess reserves and that households do not hold currency. If the reserve requirement is 10%, the Fed will use open-market operations to worth of U.S. government bonds.
Now, suppose that, rather than immediately lending out all excess reserves, banks begin holding some excess reserves due to uncertain economic conditions. Specifically, banks increase the percentage of deposits held as reserves from 10% to 20%. This increase in the reserve ratio causes the money multiplier to to . Under these conditions, the Fed would need to worth of U.S. government bonds in order to increase the money supply by $100.
Which of the following statements help to explain why, in the real world, the Fed cannot precisely control the money supply? Check all that apply.
The Fed cannot control the amount of money that households choose to hold as currency.
The Fed cannot prevent banks from lending out required reserves.
The Fed cannot control whether and to what extent banks hold excess reserves.
Answer: The answers are provided below
Explanation:
A. Total Reserve = $100
Money supply = Total reserve × multiplier
When the reserve requirement is 25%,
Simple money multiplier = 100/25 = 4
Money supply = 100 × 4 = $400
When the reserve requirement is 10%,
Simple money multiplier = 100/10 = 10
Money supply = 100 × 10 = $1000
B. A lower reserve requirement is associated with a (larger) money supply. This is done when the government wants more money to be in circulation. It is an expansionary policy.
C. Suppose the Federal Reserve wants to increase the money supply by $100. Again, you can assume that banks do not hold excess reserves and that households do not hold currency. If the reserve requirement is 10%, the Fed will use open-market operations to (purchase 100 × 10% = $10) worth of United States government bonds.
D. Now, suppose that, rather than immediately lending out all excess reserves, banks begin holding some excess reserves due to uncertain economic conditions. Specifically, banks increase the percentage of deposits held as reserves from 10% to 20%. This increase in the reserve ratio causes the money multiplier to (fall to 100 ÷ 20=5). Under these conditions, the Fed would need to (purchase 100 × 20% = $20) worth of U.S. government bonds in order to increase the money supply by $100.
E. The statements that help to explain in the real world why the Fed cannot control the money supply are:
• The Fed cannot control the amount of money that households choose to hold as currency.
• The Fed cannot control whether and to what extent banks hold excess reserves
The Money Multiplier denotes how an initial deposit can result in a larger final increase in the total money supply.
What do you mean by money multiplier?The money multiplier is a term in the financial economy that is the act of generating money in the economy through credit creation, based on a fractional banking system.
Money multiplication is also known as cash multiplication.
[tex]\rm\,Total\; Reserve = \$100\\\\Money\; supply = Total \;reserve \; \times \rm\, multiplier\\\\When \;the\; reserve \;requirement \;is \;25\%\\\\Simple\; money \;multiplier\; = \dfrac{1}{25\%} = 4\\\\Money \;supply = 100 \times 4 = \$400\\\\When\; the \;reserve\; requirement\; is \;10\%,\\\\Simple\; money \;multiplier = \dfrac{1}{ 10\%} = 10\\\\Money \;supply = 100 \times 10 = \$1000[/tex]
In the real world why the Fed cannot control the money supply are:
• The Fed cannot control the amount of money that households choose to hold as currency.
• The Fed cannot control whether and to what extent banks hold excess reserves.
Hence, the Fed cannot control the amount of money that households choose to hold as currency and the Fed cannot control whether and to what extent banks hold excess reserves are the correct statements.
To learn more about money multiplier, refer:
https://brainly.com/question/14182201
An expansionary fiscal policy will Question 4 options: always result in a budget deficit. always result in a budget surplus. sometimes result in a budget deficit. never result in a budget surplus. More information is necessary to answer this question.
Answer:
always result in a budget deficit.
Explanation:
Expansionary fiscal policy are policies undertaken by the government to increase the supply of money in the economy.
Tools of Expansionary fiscal policy are :
tax cuts
increased government spending
transfer payments.
A budget deficit occurs when government spending exceeds income.
If taxes are cut, revenue of the government would fall and this can lead to a budget deficit.
Also if the government increases its spending, spending can exceed income and this would lead to a deficit.
I hope my answer helps you
The Stationery Company purchased merchandise on account from a supplier for $9,100, terms 2/10, n/30. The Stationery Company returned merchandise with an invoice amount of $1,100 and received full credit. a. If The Stationery Company pays the invoice within the discount period, what is the amount of cash required for the payment? $
Answer:
$7,840
Explanation:
The terms 2/10, n/30 means that if the amount is paid in maximum 10 days, the client will receive a 2% discount. If he/she doesn't make the payment in this period, the total amount has to be paid within 30 days.
As Stationary Company returned merchandise with an invoice amount of $1,100, you have to subtract this amount from the initial value of the merchandise they purchased:
$9,100-$1,100= $8,000
Then, you have to calculate the 2% discount they will get from the $8,000 for paying the invoice within the discount period:
$8,000*2%= $160
$8,000-$160= $7,840
According to this, the answer is that the amount of cash required for the payment is $7,840.
Akwamba made this statement organization cannot be successful if managers fail to pay attention to the forces in the external environment. Do you agree or not. Justify using practical examples
Answer:
I agree A firm cannot be successful if it does not pay attention to external and force environments
TB MC Qu. 05-112 Eastview Company uses a perpetual... Eastview Company uses a perpetual LIFO inventory system, and has the following purchases and sales: January 1 150 units were purchased at $9 per unit. January 17 120 units were sold. January 20 160 units were purchased at $11 per unit. January 29 150 units were sold. What is the value of cost of goods sold
Answer:
$2,730
Explanation:
The computation of the cost of goods sold using the LIFO perpetual inventory system is shown below:
Since 120 units and 150 units are sold
So, the same is to be considered
Therefore the cost of goods sold is
= 120 units × $9 per unit + 150 units × $11 per unit
= $1,080 + $1,650
= $2,730
We take the 120 units at $9 per unit and 150 units at $11 per unit so that the cost of goods sold is recorded
Exercise 15-7 Adjusting available-for-sale securities to fair value LO P3 On December 31, 2017, Reggit Company held the following short-term investments in its portfolio of available-for-sale securities. Reggit had no short-term investments in its prior accounting periods. Prepare the December 31, 2017, adjusting entry to report these investments at fair value.
Answer:
debit unrealized loss-equity $15,000
credit fair value adjustment- Available-for-sale $15,000
Explanation:
Cost :
Verizano corporation bonds payable - 61,400
Preble corporation notes payable - 53,100
Lucerne company common stock - 88500
Fair value :
Verizano corporation bonds payable - 56,200
Preble corporation notes payable - 44,600
Lucerne company common stock - 85, 200
Total:
Cost = $(61,400 + 53100 + 88500) = $203,000
Fair value = $(56,200 + 44600 + 85200) = $188,000
Unrealized amount = cost - fair value
$203,000 - $188000 = ($15000) loss
debit unrealized loss-equity $15,000
credit fair value adjustment- Available-for-sale (ST) $15,000
On the basis of the details of the following fixed asset account, indicate the items to be reported on the statement of cash flows:
The reporting statement of fixed asset account is shown. The transactions are listed as follows:
Date Item Debit Credit Debit Credit
Jan. 1 Balance 885,000
Mar. 12 Purchased for cash 274,000 1,159,000
Oct. 4 Sold fo $151,000 129,000 1,030,000
Item Section of Statement of Cash Flows Added or Deducted Amount
Mar. 12: Purchase of fixed asset $
Oct. 4: Sale of fixed asset $
Gain on sale of fixed asset (assume the indirect method) $
Answer and Explanation:
The computation of the purchase of fixed assets is shown below:-
March 12 Purchase of fixed assets = $274,000. This same is shown in the investing activities section of the cash flow statement in the negative sign
October 4 Sale of fixed assets = $151,000. This same is shown in the investing activities section of the cash flow statement in the positive sign
Gain on sale of the fixed asset is
= Sales Value - Cost of asset
= $151,000 - $129,000
= $22,000
This amount is shown in the operating activities section of the cash flow statement in the negative sign
Suppose a stock had an initial price of $70 per share, paid a dividend of $2.30 per share during the year, and had an ending share price of $55. Compute the percentage total return, dividend yield, and capital gains yield. (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answers as a percent rounded to 2 decimal places, e.g., 32.16.)
Answer:
Percentage total return is - 18.14 %
Dividend yield is 3.29 %
Capital gains yield is -21.43%
Explanation:
Percentage return = (Dividends paid at end of period + Change in market value over period) ÷ Beginning market value
Percentage total return (R) = [$2.30 + ($55 - $70)] ÷ $70 = - 18.14 %
Dividend yield = Annual Dividend payout ÷ current stock price
Dividend yield = $2.30 ÷ $70 = 3.29 %
Capital gains yield =[tex]\frac{P1 - P0}{P0}[/tex]
P0 = Initial stock price
P1 = Stock price after [tex]1^{st[/tex] period
Capital gains yield = ($55 - 70) ÷ $70 = -21.43%
Claudia feels strongly against a law that was recently passed in her hometown. She proceeds to write letters to the local newspaper criticizing the effect of the law. She also marches up and down the sidewalk in front of city hall loudly publicizing her opinion. Which law or principle of law which is most relevant to this situation?
a. Procedural Due Process
b. First Amendment
c. Equal Protection Laws
d. Substantive Due Process
Answer:
Option(b) is the correct answer to the given question
Explanation:
The main objective of the first amendment says that freedom and rights regarding to the correct to the protest, religious faith, appearance as well as assembly.This law is all about the freedom to all the region of the person .
The first amendment prohibits Congress both from supporting yet another religious belief over the other and prohibiting the religious beliefs of even a person as well.As claudia writing the letters to the news paper supportive of the law's effect. She also protests upwards the sidewalk, noisily promoting her viewpoint in front of town hall it is similar to first Amendment law.All the other option are not related to the given scenario that's why these are incorrect option .You make the following deposits for the next five years into an investment account. All deposits are made at the end of the year and the first deposit occurs one year from now. No more deposits are made after year 5. You will leave all the money in the account until year 30. If you earn 10 percent annual return for the first five years and 8 percent annual return for all subsequent years, how much will you have in the account at the end of year 30?
Answer:
Instructions are below.
Explanation:
Giving the following information:
First investment:
5 deposits for 5 years at an interest rate of 10%.
Second investment:
Lump-sum for 25 years at an interest rate of 8%.
We weren't provided with the value of the deposits, but I can provide the formulas and an example.
First investment:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit= $2,000
FV= {2,000*[(1.10^5)-1]} / 0.10
FV= $12,210.2
Second investment:
FV= PV*(1+i)^n
FV= 12,210.2*(1.08^25)
FV= $83,621.25
Baja Airlines is considering these two alternatives for financing the purchase of a fleet of airplanes. 1. Issue 50,000 shares of common stock at $40 per share. (Cash dividends have not been paid nor is the payment of any contemplated.) 2. Issue 12%, 10-year bonds at face value for $2,000,000. It is estimated that the company will earn $800,000 before interest and taxes as a result of this purchase. The company has an estimated tax rate of 30% and has 90,000 shares of common stock outstanding prior to the new financing. Determine the effect on net income and earnings per share for issuing stock and issuing bonds. Assume the new shares or new bonds will be outstanding for the entire year. (Round earnings per share to 2 decimal places, e.g. $2.66.)
Answer:
Baja Airlines
Financing Alternatives:
Issued Common Stock Issued 12% Bonds
Earnings before interest & taxes $800,000 $800,000
Interest 240,000
Earnings before taxes $800,000 $560,000
Taxes: 30% 240,000 168,000
Net Income $560,000 $392,000
Number of Shares Issued 140,000 90,000
EPS $4 $4.36
Explanation:
a) With the issue of new shares, the net income was $560,000 unlike when bonds were issued, and the net income was $392,000. This shows that bond interest reduced the after-tax net income by $168,000.
b) EPS is earnings per share. It is the net income divided by the number of outstanding shares. With the issue of new shares, the EPS was $4 unlike when bonds were issued, and the EPS recorded was $4.36.
c) Implication: Stockholders benefit more with the issue of bonds than with the issue of new shares which dilute their earnings.
Describe a problem you face in your everyday life or at work. How might you use hypothesis testing to find a solution or improvement to that problem? Would you conduct a one-sample or two-sample test? What would be your null and alternative hypotheses?
Answer:
The common problem i encounter mostly is the statistical modelling problem.
In this scenario we choose best combination of independent variables for the hypothesis testing. the independent variable shows the significant effect on dependent variable so we keep it in modelling.
My null hypothesis would be that there is no significant effect of independent variable on dependent variable. for my alternative hypothesis there exist is significant effect of independent variable on dependent variable.
Explanation:
Solution
The common problem I face daily is the statistical modelling problem which is the selection of relevant independent variable for prediction modelling.
In this example to select the best combination of independent variables we use hypothesis testing. if the independent variable has significant effect on dependent variable then the independent variable shows the significant effect on dependent variable so we keep it in modelling. In this way the model gets improved.
Since there are always two variables or two categories. hence it has a two sample test.
The Hypothesis can be shown below:
Null hypothesis:
H0:There is no significant effect of independent variable on dependent variable.
Alternative hypothesis:
Ha: There is significant effect of independent variable on dependent variable.
Reliable Moving Company reported the following amounts on its balance sheet as of December 31, 2019 and December 31, 2018: 2019 2018 Cash and Receivables $95,000 $155,000 Merchandise Inventory 225,000 250,000 Property, Plant and Equipment, net 750,000 770,000 Total Assets $1,070,000 $1,175,000 Total Liabilities $465,000 $395,000 For the vertical analysis, what is the percentage of total liabilities for December 31, 2018?
Answer:
33.61%
Explanation:
Reliable Moving Company calculation of percentage of total liabilities for December 31, 2018
Using this formula
Vertical analysis % = Specific item / Base amount × 100Vertical analysis %
Where:
Specific item =$395,000
Base amount =$1,175,000
Thus:
= ($395,000 / $1,175,000) × 100Vertical analysis %
=0.33617×100 Vertical analysis %
2018 Percentage of total liabilities= 33.61%
"Raising the interest rate on reserves above the current fed funds rate means that the floor of reserve demand will push the equilibrium fed funds rate up along with the interest rate on reserves. Both borrowed reserves and non-borrowed reserves will remain the same."
a. True
b. False
Answer:
True.
Explanation:
The federal fund rates, commonly referred to as fed funds rates can be defined as the interest rate at which banks in the U.S lend money to other depository financial institutions, such as credit union or banks, mainly without any collateral and on an overnight basis.
Raising the interest rate on reserves above the current fed funds rate means that the floor of reserve demand will push the equilibrium fed funds rate up along with the interest rate on reserves. Both borrowed reserves and non-borrowed reserves will remain the same.
However, when the Fed reduces the interest rate on reserves below the current fed funds rate, it simply means that, there would be a leftward shift in the demand for reserve line, at any given interest rate. Thus, causing the fed funds rate to decrease, while borrowed reserves and non-borrowed reserves remain unchanged.
Balance sheet and income statement data indicate the following: Bonds payable, 11% (due in 15 years) $1,023,237 Preferred 8% stock, $100 par (no change during the year) $200,000 Common stock, $50 par (no change during the year) $1,000,000 Income before income tax for year $383,882 Income tax for year $115,165 Common dividends paid $60,000 Preferred dividends paid $16,000 Based on the data presented above, what is the times interest earned ratio (round to two decimal places)
Answer:
The times interest earned (TIE) ratio = 4.41 times
Explanation:
The times interest earned (TIE) ratio is an accounting ratio that shows the extent to which the income income of an organization can be used to cover its future interest expenses. This can be calculated as follows:
TIE Ratio = Earning before interest and tax (EBIT) / Interest expenses
Since,
Bonds payable, 11% (due in 15 years) = $1,023,237
Interest expenses = 11% * $1,023,237 = $112,556.07
Income before income tax for year = $383,882
EBIT = Interest expenses + Income before income tax for year = $112,556.07 + $383,882 = $496,438.07
Therefore, we have:
The times interest earned (TIE) ratio = $496,438.07 / $112,556.07 = 4.41 times
This shows that the income is 4.41 times greater than its annual interest expense. That is, the income can cover the annual interest 4.41 times.
Franchising is widely used in the casual dining and fast food industry, yet Starbucks is quite successful with a large number of company-owned stores. In 2014 Starbucks had over 7,000 company- owned stores in the United States. How do you explain this difference
Answer with its Explanation:
Their are following differences that enabled Starbucks to grow its business successfully with excellent customer feedback.
The franchising has enabled Starbucks to control the franchises to manage its business in far much better way than other methods of traditional growing businesses. The method helps in amendments of operations, processes and policies at very face pace and implementation is similar to the traditional company owned stores.
The second difference is that the product of Starbucks includes standardized and customer tailored products which makes it choice of every person. The differentiated strategy makes the business offerings a symbol of quality and taste and this standardization of services and products was very easy to implement at very lower cost than traditional company owned stores business.
Consider the following alternatives: i. $ 140 received in one year ii. $ 240 received in five years iii. $ 350 received in 10 years a. Rank the alternatives from most valuable to least valuable if the interest rate is 11 % per year. b. What is your ranking if the interest rate is 1 % per year? c. What is your ranking if the interest rate is 20 % per year?
Answer and Explanation:
The computation is shown below:
The formula is
= Amount ÷ (1 + interest rate)^number of years
a) Rate = 11%
Value of $140 in 1 year = $140 ÷ (1 + 11%) = $126.13
Value of $240 in 5 years = $240 ÷ (1 + 11%)^5 = $142.43
Value of $350 in 10 years = $350 ÷ (1 + 11%)^10 = $123.26
Now Ranking
Opotion 2 > Option 3 > Option 1
b) Rate = 1%
Value of $140 in 1 year = $140 ÷ (1 + 1%) = $138.61
Value of $240 in 5 years = $240 ÷ (1 + 1%)^5 = $228.35
Value of $350 in 10 years = $350 ÷ (1 + 1%)^10 = $316.85
Now Ranking
Option 3 > Option 2 > Option 1
c) Rate = 20%
Value of $140 in 1 year = $140 ÷ (1 + 20%) = $116.67
Value of $240 in 5 years = $240 ÷ (1 + 20%)^5 = $96.45
Value of $350 in 10 years = $350 ÷ (1 + 20%)^10 = $56.53
Now Ranking
Option 1 > Option 2 > Option 3
During its first year of operations, Mack’s Plumbing Supply Co. had sales of $420,000, wrote off $6,700 of accounts as uncollectible using the direct write-off method, and reported net income of $46,200. Determine what the net income would have been if the allowance method had been used, and the company estimated that 1 3/4% of sales would be uncollectible.
Answer:
The net income would have been $45,550
Explanation:
In order to calculate the amount the net income would have been if the allowance method had been used, and the company estimated that 1 3/4% of sales would be uncollectible, we would have make the following calculation:
Net income would have been if the allowance method had been used = $46,200 + $6,700 – ($420,000 × 1 3/4%)
Net income would have been if the allowance method had been used= $45,550
The net income would have been $45,550
Bering Rock acquires a granite quarry at a cost of $590,000, which is estimated to contain 200,000 tons of granite and is expected to take 6 years to remove. Compute the depletion expense for the first year assuming 38,000 tons were removed.
Answer:
$112,100
Explanation:
The depletion expense for the year is the tons of granite removed in the year divided by the total expected granite removable multiplied by the cost of acquiring the granite quarry of $590,000.
Tons of granite removed in the year is 38,000 tons
total granite removable is 200,000 tons
depletion expense=38,000/200,000*$590,000=$ 112,100.00
The depletion expense is $112,100
The appropriate journal entry would to debit depletion expense with $112,100 and credit accumulated depletion
Assume that two investors each hold a portfolio, and that portfolio is their only asset. Investor A's portfolio has a beta of minus 2.0, while Investor B's portfolio has a beta of plus 2.0. Assuming that the unsystematic risks of the stocks in the two portfolios are the same, then the two investors face the same amount of risk. However, the holders of either portfolio could lower their risks, and by exactly the same amount, by adding some "normal" stocks with beta = 1.0.
1. True
2. False
Answer:
1. True
Explanation:
Both investors' portfolios are equally risky (they are both twice as risky as the market). If any of them invests in stocks with a beta = 1 (market beta), then their portfolio's risk would reduce since the total beta would move towards the market risk. For both of them, the more stocks with beta = 1 that they add to their portfolio's, the more the portfolio's risk will reduce.
Below is a list of prices for zero-coupon bonds of various maturities. Maturity (Years) Price of $1,000 Par Bond (Zero-Coupon) 1 $ 943.40 2 873.52 3 816.37 a. An 8.5% coupon $1,000 par bond pays an annual coupon and will mature in 3 years. What should the yield to maturity on the bond be
Answer:
6.997%
Explanation:
To find the answer, we use the Yield to Maturity (YTM) for a Zero Coupon Bond:
YTM = [(F/PV)^1/n] - 1
Where:
F: Face/Par value (the question is telling us that the par value of a 3-year bond is $816.367)
PV: Present Value (which is the same as the price: $1,000)
n: number of periods (in this case 3 years because the coupon is annual)
Now, we plug the amounts into the formula:
YTM = [($1,000/$816.37)^1/3]-1
YTM = 6.997%
Holten Farm sells new tractors and pays each salesperson a commission of $1,000 for each tractor sold. During the month of August, a salesperson, Fred, sold 3 new tractors. Jacob pays Jason on the 10th day of the month following the sale. Fred operates on the cash basis; the tractor dealer operates on the accrual basis. Which of the following statements is true?
A) Fred will recognize commission revenue earned in the amount of $3,000 in August.
B) Jacob will recognize commission expense in the amount of $3,000 in August.
C) Fred will recognize commission expense in the amount of $3,000 in September.
D) Fred will recognize revenue in the same month that the tractor dealer recognizes expense.
Answer:
B.Jacob will recognize commission expense in the amount of $3,000 in August
Explanation:
Jacob will recognize commission expense in the amount of $3,000 in August for the 3 tractors that was sold and Jacob was the salesperson who pays Jason the amount of cash realized on the 10th day of the month following the sale of the tractors.
The Commission expenses can be calculated as:
(commission of $1,000× Number of tractor 3)
=$3,000
Calculating and using Dual Charging Rates
The expected costs for the Maintenance Department of Stazler, Inc., for the coming year include:
Fixed costs (salaries, tools): $65,400 per year
Variable costs (supplies): $1.3 per maintenance hour
The Assembly and Packaging departments expect to use maintenance hours relatively evenly throughout the year. The Fabricating Department typically uses more maintenance hours in the month of November. Estimated usage in hours for the year and for the peak month is as follows:
Yearly Monthly
hours Peak Hours
Assembly Department 4,300 210
Fabricating Department 6,900 1,050
Packaging Department 10,800 840
Total maintenance hours 22,000 2,100
Actual usage for the year by:
Assembly Department 3,500
Fabricating Department 7,000
Packaging Department 10,000
Total maintenance hours 20,500
Required:
1. Calculate a variable rate for the Maintenance Department. Round your answer to the nearest cent. $ per maintenance hour Calculate the allocated fixed cost for each using department based on its budgeted peak month usage in maintenance hours.
Department Peak Number of Hours Allocated Fixed Cost
Assembly
Fabrication
Packaging
Total
2. Use the two rates to assign the costs of the Maintenance Department to the user departments based on actual usage. Calculate the total amount charged for maintenance for the year.
Assembly
Fabricating
Packaging
Total
3. What if the Assembly Department used 3,550 maintenance hours in the year? How much would have been charged out to the three departments?
Assembly
Fabricating
Packaging
Total
Answer:
1. Calculate a variable rate for the Maintenance Department. Round your answer to the nearest cent. $ per maintenance hour Calculate the allocated fixed cost for each using department based on its budgeted peak month usage in maintenance hours.
variable rate = $1.30 per maintenance hour
Department Peak Number Allocated
of hours Fixed cost
Assembly (210/2,100) x $65,400 $6,540
Fabrication (1,050/2,100) x $65,400 $32,700
Packaging (840/2,100) x $65,400 $26,160
Total 2,100/2,100 $65,400
2. Use the two rates to assign the costs of the Maintenance Department to the user departments based on actual usage. Calculate the total amount charged for maintenance for the year.
Department Fixed costs Variable cost Total
Assembly $6,540 3,500 x $1.30 = $4,550 $11,090
Fabricating $32,700 7,000 x $1.30 = $9,100 $41,800
Packaging $26,160 10,000 x $1.30 = $13,000 $39,160
Total $65,400 $26,650 $92,050
3. What if the Assembly Department used 3,550 maintenance hours in the year? How much would have been charged out to the three departments?
Department Fixed costs Variable cost Total
Assembly $6,540 3,550 x $1.30 = $4,615 $11,155
Fabricating $32,700 7,000 x $1.30 = $9,100 $41,800
Packaging $26,160 10,000 x $1.30 = $13,000 $39,160
Total $65,400 $26,715 $92,115
A list of financial statement items for Blue Spruce Corp. includes the following: accounts receivable $28,700; prepaid insurance $5,330; cash $21,320; supplies $7,790; and debt investments (short-term) $16,810. Prepare the current assets section of the balance sheet listing the items in the proper sequence. (List current assets in order of liquidity.
Answer:
BLUE SPRUCE CORPS
PARTIAL BALANCE SHEET
Current Assets $
Cash 21,320
Debt Investment (Short Term) 16,810
Account Receivables 28,700
Supplies 7,790
Prepaid Insurance 5,530
Total Current Assets 79,950
Item 3Item 3 Manufacturing overhead was estimated to be $385,700 for the year along with 20,300 direct labor hours. Actual manufacturing overhead was $423,400, and actual labor hours were 21,600. The amount debited to the Manufacturing Overhead account would be:
Answer:
$423,400
Explanation:
The Overhead applied to Product Costs are Credited in the Overhead Account whilst the Overheads Actually incurred are Debited. The difference between the debit and credit will represent the amount of overheads under-applied or overheads over applied.
Actual Overheads incurred = $423,400
Applied Overheads = $385,700/20,300 × 21,600
= $ 410,400
Answer:
Debit manufacturing overhead with actual overhead incurred-$423,400
Explanation:
Absorbed overhead = Overhead absorption rate (OAR) × actual direct labour hours
OAR = Budgeted overhead / Budgeted labour hours
= $385,700/20,300 hours=
Absorbed overhead = $19 × 21,600 =$410,400
Absorbed overhead = $410,400 .
In accounting for overhead the following entries would be observed
Debit manufacturing overhead with actual overhead incurred-$423,400
And credit manufacturing overhead with absorbed overhead- $410,400
The difference of $13000 is the over absorbed overhead
Outside the United States and the United Kingdom, concentrated ownership of the company is more the exception than the rule. diffused ownership of the company is more the exception than the rule. partnerships are more important than corporations. none of the options 1.25 points Save Answer
Answer:
Diffused ownership of the company is more the exception than the rule.
Explanation:
Outside the United States and the United Kingdom, diffused ownership is more the exception than the rule mostly because the forms of diffuse corporate ownership tend to have an American or British origin, and from the U.S. and the U.K., they expand to other countries with time.
For example, Limited Liability Companies is a type of company with diffused ownership, and has been exported with different names to other countries, becoming more popular with time.