Answer:
Cost of Direct Material Used $134,900.
Under applied Overhead $36,000
Explanation:
Cost of Direct Material Used
Opening Material $44,000
Add: Opening Work in Process $9,300
Add: Purchases $185,000
Less: Closing Material $49,000
Less: Closing Work in process $19,800
Less: Closing finished goods $34,600
= $134,900
Overhead Rate Application:
Budgeted Overhead 55% of direct labor cost [55% * 250,000] = $137,500
Actual Overhead is $173,500
Under applied Overhead is $36,000
heres a freebe to get more points. whats ur fav disney movie and whos ur fav disney princess. why?
Answer:
fav Disney movie: coco fav Disney princess: Tiana
Explanation:
i dont know why I just like them and they dont have a lot of black princesses so yeah
Answer:
belle and beauty and the beast
Explanation:
because shes not judgmental and can be her own person
Starbucks opened its first store in Seoul, Korea in October 2002. The price of a tall vanilla latte is 3,000 Korean Won. In New York City, the price of a tall vanilla latte is $3.00. The exchange rate between Korean Won and U.S. dollars is Won 1,150/$. According to purchasing power parity, is the Korean Won overvalued or undervalued
Answer:
The Korean Won is undervalued
Explanation:
The Korean Won is undervalued if we determine this measure by comparing the prices of the vanilla latte at a Korean Starbucks and at an American Starbucks.
If purchasing power parity was perfectly equal, the latte at the Seoul Starbucks would be priced at $3,450, because the exchange rate is 1,150/$ and $3 x 1,1150 = 3,450, $3 being the price of the latte in New York City.
We can see that the latte in Seoul only costs 3,000 Won, so, under this comparison, the Won is undervalued by 450 Won.
A rational buyer will: buy a product until the marginal benefit of consuming the product is less than the price of the product. buy the product only when the marginal benefit of consuming the product is twice as much as the price of the product. not consider costs versus benefits when purchasing a product. keep buying a product until marginal benefit equals price.
Answer:
keep buying a product until marginal benefit equals price
Explanation:
A rational consumer would continue to consume a product until the marginal benefit of the last unit consumed equal marginal cost. At this point, utility is maximised.
For example, if the price of a bottle of water is $4. The utility you derive from the first bottle is 6. So you consume one more bottle, the utility you derive from the second bottle is 5. you buy a third bottle. The utility you derive from the 3rd bottle is 4. At this point utility is maximised and you should stop consuming more water
If you consume a 4th bottle, the utility you would derive from it would be 3 utils. This doesn't make sense because you are paying more for the bottle when compared to the utility you would derive from it
Required information Skip to question [The following information applies to the questions displayed below.] Victory Company uses weighted-average process costing to account for its production costs. Conversion cost is added evenly throughout the process. Direct materials are added at the beginning of the first process. During November, the first process transferred 780,000 units of product to the second process. Additional information for the first process follows. At the end of November, work in process inventory consists of 185,000 units that are 50% complete with respect to conversion. Beginning work in process inventory had $188,175 of direct materials and $196,313 of conversion cost. The direct material cost added in November is $1,259,325, and the conversion cost added is $3,729,937. Beginning work in process consisted of 76,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion. Of the units completed, 76,000 were from beginning work in process and 704,000 units were started and completed during the period. Required: For the first process: 1. Determine the equivalent units of production with respect to direct materials and conversion.
Answer:
Direct materials = 965,000 units Conversion = 872,500 units
Explanation:
a. Direct materials
Direct materials are added at the beginning of the process so ending EUP is 100% in respect to EUP.
EUP Direct materials = Finished goods + Closing EUP
= 780,000 + 185,000
= 965,000 units
b. Conversion
= Finished goods + Closing EUP
= 780,000 + (0.50 * 185,000)
= 780,000 + 92,500
= 872,500 units
What is the first step in the standard purchasing process practiced by most companies
Answer:
requisition
Explanation:
its correct :D
The first step in the standard purchasing process practised by most companies is requisition.
What do you understand by requisition?Requisition is a request for goods or services made by an employee to the person or department in a company that is responsible for purchasing. If the request is approved, that entity will submit a purchase order to a supplier for the goods or services. In this context, a requisition is also known as a purchase requisition.
Requisitions are usually submitted in a standardized format on paper form or through e-procurement software that automates some of the tasks involved and reduces duplication of effort. A requisition form, whether physical or digital, typically includes the details about the item requested, the date of the request, the individual and department making the request and the location where the goods should be delivered.
Copies of the requisition, the purchase order, the invoice and the packing slip are usually stored together.
Learn more about requisition, here:
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I have a group of friends. One thing we have in common is that we all want a Tesla Model 3. We can all afford to buy a Tesla Model 3. However, we are all unwilling to pay the current price for a Tesla Model 3. Thus, my group of friends are not this:_______.
a. cool in any sense of the word
b. a market of potential Tesla customers
c. a positioning market group
d. a useful segmenting base
Answer:
b. a market of potential Tesla customers
Explanation:
As given all friend afford to buy a Tesla Model 3 and unwilling to pay the current price so group of friends is a market of potential Tesla customersA potential market is a group of people from the entire population who show some interest in buying a particular product or service. so correct option is b. a market of potential Tesla customersYou have been learning about the accounting equation, debits/credits, and account normal balances. The accounting equation is the foundation of accounting. Understanding debits/credits and the account normal balances are just as important. Sometimes, these concepts are difficult to understand and/or remember. Please research the Internet to find fun and easy ways to remember this information. It could be a song, a mnemonic, phrase, video, etc. It can even be something that you have created. Make sure that the information is college appropriate. Please post your findings and include a link that references the material. Then in a minimum of a paragraph, summarize why you choose this source, how it has helped you remember the material, and why other students would find it helpful.
Answer:
using the word DEALER
since we record our debit accounts on the left hand side of the Ledger and we record credit accounts on the right hand side of the Ledger hence
DEA represents ( Dividends, expenses , Assets ) which are recorded in Debit accounts while
LER represents ( Liabilities ,Equity and revenues ) which are recorded in credit accounts
Explanation:
The fundamentals of accounting is based on the ability to distinguish between a Debit and a credit . ability to do this efficiently will help in the process of balancing the ledger at the end of each accounting period. most times the concepts of Debits and credits are not so easy to memorize hence i will such the Fun way of Memorizing them which is;
using the word DEALER
since we record our debit accounts on the left hand side of the Ledger and we record credit accounts on the right hand side of the Ledger hence
DEA represents ( Dividends, expenses , Assets ) which are recorded in Debit accounts while
LER represents ( Liabilities ,Equity and revenues ) which are recorded in credit accounts
When the company is hosting an event, managers should assign event preparations to a ________. Preparations include trucking in different kinds of equipment and setting it up over several acres; installing sufficient security, first aid, and portable restrooms throughout the course; and having food and drink delivered, as well as marketing the event and enrolling participants. Hiring team members who are diverse in terms of gender and race is likely to_____________ the team's productivity.
Answer:
Cross functional team / will increase
Explanation:
A cross functional team can be defined as a team formed by people with different areas of expertise, as is the case of a team specialized in the organization of business events.
Cross functional teams have the advantages of making work more effective and more productive by the possibility that each person is responsible for a different area and therefore the work takes place in a much more flexible, dynamic and creative way, since there is greater autonomy, greater capacity to communication and lower hierarchy in these teams, and the greater the diversity of professionals, the more the teams will be innovative and productive.
As part of its commitment to quality, the J. J. Borden manufacturing company is proposing to introduce just-in-time (JIT) production methods. Managers of the company have an intuitive feel regarding the financial benefits associated with a change to JIT, but they would like to have some data to inform their decision making in this regard. You are provided with the following data:
Item ExistingSituation AfterAdopting JIT
Manufacturing costs as percentage of sales:
Product-level support 15 % 4 %
Variable manufacturing overhead 28 10
Direct materials 30 20
Direct manufacturing labor 20 13
Other financial data:
Sales revenue $ 1,430,000 $ 1,810,000
Inventory of WIP 260,000 46,000
Other data:
Manufacturing cycle time 60 days 30 days
Inventory financing costs (per annum) 10 % 10 %
Required:
As the management accountant for the company, prepare an estimate the financial benefits associated with the adoption of JIT. Specifically, what is the estimated change in annual operating income attributable to the JIT implementation?
Answer:
A. $74,100 $954,700
B. $880,600
Explanation:
A. Preparation to estimate the financial benefits associated with the adoption of JIT
Current situation After JIT
Sales 1,430,000 1,810,000
Less costs
Production level support 214,500 72,400
(15%*1,430,000=214,500)
(4%*1,810,000=72,400)
Variable manufacturing overhead 400,400 181,000
(28%*1,430,000=400,400)
(10%*1,810,000=181,000)
Direct material 429,000 362,000
(30%*1,430,000=429,000)
(20%*1,810,000=362,000)
Direct manufacturing labor 286,000 235,300
(20%*1,430,000=286,000)
(13%*1,810,000=235,300)
Inventory financing costs 26,000 4,600
(10%*260,000=26,000)
(10%*46,000=4,600)
Total costs 1,355,900 855,300
Operating profits $74,100 $954,700
(1,430,000-1,355,900)
(1,810,000-855,300)
Therefore the the financial benefits associated with the adoption of JIT will be $74,100 $954,700
B. Preparation for the estimated change in annual operating income attributable to the JIT implementation
Current situation After JIT Change
Sales 1,430,000-1,810,000=-380,000
Less costs
Production level support 214,500-72,400 =142,100
Variable manufacturing overhead 400,400 -181,000=219,400
Direct material 429,000-362,000=67,000
Direct manufacturing labor 286,000- 235,300= 50,700
Inventory financing costs 26,000-4,600 =21,400
Total costs 1,355,900-855,300=500,600
Operating profits 74,100-954,700=880,600
Therefore the estimated change in annual operating income attributable to the JIT implementation will be 880,600
Assume for a moment that Sue, the owner of Camp Bow Wow in Colorado, said that she was looking to provide constantly evolving and improving pet care services that no other organization offered. This would be an example of a-----------------------------strategy.
a. specialization by building customer intimacy
b. cost leadership by being operationally excellent
c. differentiation through product innovation
d. expansion and growth to enhance earnings per share by building out new operations
Answer:
c. differentiation through product innovation
Explanation:
This would be an example of a differentiation through product innovation strategy because She is constantly looking for an evolving project and at the same time no other organisation has provided this product, which is an example of differentiations with leadership . so correct option is c. differentiation through product innovationAs per the question the owners of the camp wow is looking to provide a continuously evolving and improving pet care service that has no organization.
This is an example of the product innovation and is a subsequent creation of the product or a good or service. Hence the option C is correct. That is differentiation by the innovationLearn more about the owner of Camp Bow Wow.
brainly.com/question/15593483.
The gross domestic product (GDP) of the United States is defined as the market value of allfinal goods and services produced within the United States in a given period of time. Based on this definition, indicate which of the following transactions will be included in (that is, directly increase) the GDP of the United States in 2018.
a. An accountant starts a client's 2018 tax return on April 14, 2019, finishing it just before midnight on April 15, 2019. Chocolate Express, a Swiss chocolate company, produces a chocolate bar at a plant in Illinois on December 5, 2018.
b. An elementary school student buys the chocolate bar on December 24. Rotato, a U.S. tire company, produces a set of tires at a plant in Michigan on September 13, 2018. It sells the set of tires to Speedmaster for use in the production of a two-door coupe that will be made in the United States in 2018. (Note: Focus exclusively on whether production of the set of tires increases GDP directly, and ignore the effect of production of the two-door coupe on GDP.)
c. Zippycar, a U.S. automobile company, produces a convertible at a manufacturing plant in Minneapolis on January 9, 2018. It sells the car at a dealership in San Diego on February 24, 2018.
d. Athleticus, a U.S. shoe company, produces a pair of sneakers at a plant in Vietnam on March 17, 2018. Athleticus imports the pair of sneakers into the United States on May 21, 2018.
Answer:
Chocolate Express, a Swiss chocolate company, produces a chocolate bar at a plant in Illinois on December 5, 2018.
b. An elementary school student buys the chocolate bar on December 24..
c. Zippycar, a U.S. automobile company, produces a convertible at a manufacturing plant in Minneapolis on January 9, 2018. It sells the car at a dealership in San Diego on February 24, 2018.
d. Athleticus, a U.S. shoe company, produces a pair of sneakers at a plant in Vietnam on March 17, 2018. Athleticus imports the pair of sneakers into the United States on May 21, 2018.
Explanation:
Gross domestic product is the total sum of final goods and services produced in an economy within a given period which is usually a year
GDP calculated using the expenditure approach = Consumption spending by households + Investment spending by businesses + Government spending + Net export
Net export = exports – imports
When exports exceed import there is a trade deficit and when import exceeds import, there is a trade surplus.
Items not included in the calculation off GDP includes:
1. services not rendered to oneself
2. Activities not reported to the government
3. illegal activities
4. sale or purchase of used products
5. sale or purchase of intermediate products
The accountant's work would be included in 2019's GDP
The chocolate purchase would be included in GDP as part of consumption expenditure
Tire is an intermediate good in this question and would not be included in GDP
The purchase of the shoe from Vietnam would have no effect on GDP because it decreases net export
Which part/phrase in the passage hints at a disadvantage that Gary suffers as a franchisee?
Gary entered a franchise contract with a manufacturing company a year back.
He has to sell the company's products under its trademark. He
has been learning the company's management techniques as per the contract.
He cannot pitch new ideas to his franchisor since the contract
restricts his creativity and independence.
He has to pay royalties and a small percentage of his sales revenue to the franchisor every month.
Answer:
I believe it is "He cannot pitch new ideas to his franchisor since the contract
restricts his creativity and independence." because he can't help his business grow when he can't make new ideas.
Answer:
2nd sentence
Explanation:
The following information is available for Barnes Company for the fiscal year ended December 31: Beginning finished goods inventory in units 0 Units produced 7,800 Units sold 5,500 Sales $ 1,100,000 Materials cost $ 156,000 Variable conversion cost used $ 78,000 Fixed manufacturing cost $ 702,000 Indirect operating costs (fixed) $ 110,000 The absorption costing operating income is:
Answer:
See below
Explanation:
Material cost
$156,000
Add:
Variable conversion cost used
$78,000
Add:
Fixed manufacturing cost
$702,000
Total manufacturing cost
$936,000
Unit product cost
= Total manufacturing cost / Units produced
= $936,000/7,800
= $120
Ending inventory in unit produced
= Units produced - Units sold
= 7,800 - 5,500
= 2,300 units
Ending inventory under absorption costing
= 2,300 units × $120
= $276,000
Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget for the year includes $432,000 payroll for 4,800 direct labor-hours. Listed below is cost driver information used in the product-costing system:
Overhead Cost Pool Budgeted Overhead Cost Driver Estimated Cost Driver Level
Machine setups $120,000 # of setups 120 setups
Materials handling 104,400 # of barrels 8,700 barrels
Quality control 264,000 # of inspections 1,100 inspections
Other overhead cost 144,000 # of machine hours 12,000 machine hours
Total overhead $632,400
A current product order has the following requirements:
Machine setups 8 setups
Materials handling 606 barrels
Quality inspections 80 inspections
Machine hours 830 machine hours
Direct labor hour 336 hours
Using ABC, how much other overhead is assigned to the order?
a. $9,960.
b. $8,000.
c. $11,108.
d. $45,992.
e. $19,200.
Answer:
See below
Explanation:
Given the above information
Payroll = $432,000 ÷ 4,800 = $90 per hour
Setup = $120,000 / 120 = $1,000 per setup
Material handling barrel = $104,400 / 8,700 = $11.95 per barrel
Quality control inspection = $264,000 / 1,100 = $240 per inspection
Overhead = $144,000 / 12,000 = $12 per machine hour
Details of the current product requirement
8 setup = 8 × $1,000 = $8,000
606 barrels = 606 × $11.95 = $7,242
80 inspections = 80 × $240 = $19,200
830 machine hours = 830 × $12 = $9,960
336 labor hours = 336 × $90 = $30,240
Total overhead assigned to order = $74,642
Isabel, a calendar-year taxpayer, uses the cash method of accounting for her sole proprietorship. In late December she received a $20,000 bill from her accountant for consulting services related to her small business. Isabel can pay the $20,000 bill anytime before January 30 of next year without penalty. Assume her marginal tax rate is 37 percent this year and next year, and that she can earn an after-tax rate of return of 8 percent on her investments
Required:
a. What is the after-tax cost if Isabel pays the $19,000 bill in December?
b. What is the after-tax cost if Isabel pays the $19,000 bill in January?
c. Based on requirement a and b, should Isabel pay the $19,000 bill in December or January?
Answer:
A. $11,970
B. $11,890
C. January
Explanation:
a. Calculation for the after-tax cost if Isabel pays the $19,000 bill in December
After-tax cost=$19,000 - ($19,000 x 37%)
After-tax cost= $19,000 - $7,030
After-tax cost= $11,970
Therefore the after-tax cost if Isabel pays the $19,000 bill in December will be $11,970
b. Calculation for the after-tax cost if Isabel pays the $19,000 bill in January
First step is to calculate the cost before taxes
Cost before taxes = $19,000 - ($19,000 x 8%/12) Cost before taxes= $19,000 - $127
Cost before taxes= $18,873
Now let calculate the After-tax cost
After-tax cost = $18,873 - ($18,873 x 37%)
After-tax cost= $18,873 - $6,983
After-tax cost = $11,890
Therefore the after-tax cost if Isabel pays the $19,000 bill in January will be $11,890
c. Based on the above calculation for both a and b, Isabel should pay the amount of $19,000 bill in January reason that it has the lowest cost of debt of the amount of $11,890 compare to December which has the cost of debt of the amount of $11,970.
Spicewood Stables, Inc., was established in Dripping Springs, Texas, on April 1. The company provides stables, care for animals, and grounds for riding and showing horses. You have been hired as the new assistant controller. The following transactions for April are provided for your review.
1. Received contributions from investors and issued $230,000 of common stock on April 1.
2. Acquired a barn for $180,000. On April 2, the company paid half the amount in cash and signed a three-year note payable for the balance.
3. Provided $18,000 in animal care services for customers on April 3, all on credit.
4. Rented stables to customers who cared for their own animals; received cash of $14,000 on April 4 for rent earned this month.
5. On April 5, received $3,350 cash from a customer to board her horse in May, June, and July (record as Deferred Revenue).
6. Purchased and received hay and feed supplies on account on April 6 for $3,800.
7. Paid $2,600 on accounts payable on April 7 for previous purchases.
8. Received $2,040 from customers on April 8 on accounts receivable.
9. On April 9, prepaid a two-year insurance policy for $4,800 for coverage starting in May.
10. On April 28, paid $1,140 in cash for water and utilities used this month.
11. Paid $14,800 in wages on April 29 for work done this month.
12. Received an electric utility bill on April 30 for $1,560 for usage in April; the bill will be paid next month.
Required:
1. Prepare the journal entry for each of the above transactions.
2. Post the transaction activity from requirement 1 to the T-Accounts below. All accounts begin with zero balances because this is the first month of operations.
3. Prepare an unadjusted trial balance as of April 30.
4-a. Refer to the revenues and expenses shown on the unadjusted trial balance. Based on this information, calculate preliminary net income and net profit margin.
4-b. Determine whether the net profit margin is better or worse than the 30.0 percent earned by a close competitor.
Answer:
Spicewood Stables, Inc.
1. Journal Entries:
April 1:
Debit Cash $230,000
Credit Common Stock $230,000
To record contributions from investors and issuance of stock.
April 2:
Debit Barn $180,000
Credit Cash $90,000
Credit Notes Payable (Long-term) $90,000
To record the acquisition of a barn.
April 3:
Debit Accounts Receivable $18,000
Credit Service Revenue $18,000
To record the provision of animal care services on credit.
April 4:
Debit Cash $14,000
Credit Rent Revenue $14,000
To record the renting of stables to customers for April.
April 5:
Debit Cash $3,350
Credit Deferred Revenue $3,350
To record the receipt of cash from customer in advance.
April 6:
Debit Supplies $3,800
Credit Accounts Payable $3,800
To record the purchase of hay and feed supplies on account.
April 7:
Debit Accounts Payable $2,600
Credit Cash $2,600
To record the payment on account
April 8:
Debit Cash $2,040
Credit Accounts Receivable $2,040
To record the receipt of cash from customers.
April 9:
Debit Prepaid Insurance $4,800
Credit Cash $4,800
To record the prepayment of insurance for 2 years.
April 10:
Debit Utilities Expense $1,140
Credit Cash $1,140
To record the payment for water and utilities.
April 11:
Debit Wages Expense $14,800
Credit Cash $14,800
To record the payment of wages for the month.
April 12:
Debit Utilities Expense $1,560
Credit Utilities Payable $1,560
To record the accrued electric utility bill.
2. T-Accounts:
Cash
Date Account Title Debit Credit
April 1 Common stock $230,000
April 2 Barn $90,000
April 4 Rent Revenue 14,000
April 5 Deferred Revenue 3,350
April 7 Accounts payable 2,600
April 8 Accounts receivable 2,040
April 9 Prepaid Insurance 4,800
April 10 Utilities Expenses 1,140
April 11 Wages Expense 14,800
April 12 Balance $136,050
Totals $249,390 $249.390
Common Stock
Date Account Title Debit Credit
April 1 Cash $230,000
Barn
Date Account Title Debit Credit
April 2 Cash $90,000
April 2 Notes payable 90,000
April 12 Balance $180,000
Notes Payable
Date Account Title Debit Credit
April 2 Barn $90,000
Accounts Receivable
Date Account Title Debit Credit
April 3 Service Revenue $18,000
April 8 Cash $2,040
April 12 Balance $15,960
Service Revenue
Date Account Title Debit Credit
April 3 Accounts receivable $18,000
Rent Revenue
Date Account Title Debit Credit
April 4 Cash $14,000
Deferred Revenue
Date Account Title Debit Credit
April 5 Cash $3,350
Supplies
Date Account Title Debit Credit
April 6 Accounts Payable $3,800
Accounts Payable
Date Account Title Debit Credit
April 6 Supplies $3,800
April 7 Cash $2,600
April 12 Balance $1,200
Prepaid Insurance
Date Account Title Debit Credit
April 9 Cash $4,800
Utilities Expenses
Date Account Title Debit Credit
April 10 Cash $1,140
Wages Expense
Date Account Title Debit Credit
April 11 Cash $14,800
3. Unadjusted Trial Balance as of April 30:
Account Title Debit Credit
Cash $136,050
Common stock $230,000
Barn 180,000
Notes payable 90,000
Accounts receivable 15,960
Service Revenue 18,000
Rent Revenue 14,000
Deferred Revenue 3,350
Supplies 3,800
Accounts payable 1,200
Prepaid Insurance 4,800
Utilities Expenses 1,140
Wages Expense 14,800
Totals $356,550 $356,550
4a.
Service Revenue 18,000
Rent Revenue 14,000
Total revenues $32,000
Utilities Expenses 1,140
Wages Expense 14,800
Total expenses $15,940
Net Income $16,060
Net profit margin = $16,060/$32,000 * 100 = 50.19%
4b. The net profit margin is better than the 30.0% earned by a close competitor.
Explanation:
The adjustment for Electric Utility does not form part of the adjusted trial balance. If we assume that the payment was eventually made on April 30, the Cash Balance will reduce by $1,560 and the total expenses will increase by the same amount with an equal reduction in the net income to $14,500. This will also reduce the net profit margin to 45.31%.
Avery Corporation's target capital structure is 35% debt, 10% preferred, and 55% common equity. The interest rate on new debt is 6.50%, the yield on the preferred is 6.00%, the cost of common from reinvested earnings is 11.25%, and the tax rate is 25%. The firm will not be issuing any new common stock. What is Avery's WACC
Answer:
8.15%
Explanation:
The computation of the weighted average cost of capital as follows;
= After Cost of debt × weightage of debt + cost of preferred stock × weight of preferred stock + cost of common equity × weight of equity
= 6.50% × (1 - 0.40) × 35 ÷ 100 + 6% × 10 ÷ 100 + 11.25% × 55 ÷ 100
= 1.37% + 0.60% + 6.19%
= 8.15%
what is a down payment of 20 percent on a purchase price of $215,000
Answer:
$43,000
Explanation:
The Best Manufacturing Company is considering a new investment. Financial projections for the investment are tabulated here. The corporate tax rate is 34%. Assume all sales revenue is received in cash, all operating costs and income taxes are paid in cash, and all cash flows occur at the end of the year. All net working capital is recovered at the end of the project.
Year 0 Year 1 Year 2 Year 3 Year 4
Investment $40,000
Sales revenue $20,500 $21,000 $21,500 $18,500
Operating costs 4,300 4,400 4,500 3,700
Depreciation 10,000 10,000 10,000 10,000
Change in NWC 460 510 560 460 ?
Change in NWC in year 4 will be sum of all the NWC needed in year 0-3.
A. Compute the incremental net income of the investment for each year. Do not intermediate calculations.
Year 1 Year 2 Year 3 Year 4
Net income $ $ $ $
B. Compute the incremental cash flows of the investment for each year. Do not round intermediate calculations. Negative amounts should be indicated by a minus sign.
Year 0 Year 1 Year 2 Year 3 Year 4
Cash Flow $ $ $ $ $
C. Suppose the appropriate discount rate is 12%. What is the NPV of the project? Do not Round intermediate calculations and round your final answer to 2 decimal places.
NPV $____
Answer:
The Best Manufacturing Company
A. Incremental Net Income:
Year 0 Year 1 Year 2 Year 3 Year 4
Sales revenue $20,500 $21,000 $21,500 $18,500
Operating costs 4,300 4,400 4,500 3,700
Depreciation 10,000 10,000 10,000 10,000
Net Income 6,200 6,600 7,000 4,800
Incremental NI 6,200 400 300 -3,200
B. Incremental cash flows:
Investment -$40,000
Sales revenue $20,500 $21,000 $21,500 $18,500
Operating costs -4,300 -4,400 -4,500 -3,700
Change in NWC -460 -510 -560 -460 1,990
Net Cash flows -24,260 $16,090 $16,440 $14,340 1,990
Incremental
cash flows -$24,260 $8,170 $350 -$2,100 -$12,440
C. NPV = $14,686.77
Explanation:
a) Data and Calculations:
Corporate tax rate = 34%
Year 0 Year 1 Year 2 Year 3 Year 4
Investment $40,000
Sales revenue $20,500 $21,000 $21,500 $18,500
Operating costs 4,300 4,400 4,500 3,700
Depreciation 10,000 10,000 10,000 10,000
Net Income 6,200 6,600 7,000 4,800
Incremental NI 6,200 400 300 -3,200
Incremental cash flows:
Investment -$40,000
Sales revenue $20,500 $21,000 $21,500 $18,500
Operating costs -4,300 -4,400 -4,500 -3,700
Change in NWC -460 -510 -560 -460 1,990
Net Cash flows -24,260 $16,090 $16,440 $14,340 1,990
Incremental
cash flows -$24,260 $8,170 $350 -$2,100 -$12,440
Net Present Value of the project:
Net Cash flows Discount PV
Factor
Year 0 -24,260 1 -$24,260.00
Year 1 16,090 0.893 14,368.37
Year 2 16,440 0.797 13,102.68
Year 3 14,340 0.712 10,210.08
Year 4 1,990 0.636 1,265.64
NPV $14,686.77
ABC Co. had 600,000 shares of Common Stock, 40,000 shares of Convertible Preferred Stock, and $3,000,000 of 6% Convertible Bonds outstanding during 2021. The Convertible Preferred Stock is convertible into 80,000 shares of Common Stock. During 2021, ABC Co. paid dividends of $4 per share on the Common Stock and $3 per share on the Convertible Preferred Stock. Each $1,000 Convertible Bond is convertible into 80 shares of Common Stock. The Net Income for 2021 was $1,600,000 and the income tax rate was 30%.
Calculate basic earning per year of common stock for the year ended January1 31, 2104.
If company's preferred stock were convertiable into common stock what additional calculation would be required?
Answer:
a. Net income for 2021 $1,600,000
Less: Preferred dividends $120,000 (40000*$3)
Net income for Common Stockholders $1,480,000
Divide by Common Shares outstanding 600,000
Basic Earnings per share for 2021 $2.47
b. If company's preferred stock were convertible into common stock, diluted earnings per shares will also have to be calculated.
Constable Co. reported the following information at December 31, Year 1:
Accounts Payable $4,540
Accounts Receivable 9,390
Cash 23,890
Common Stock 90,400
Equipment 49,900
Inventory 31,600
Notes Payable due December 31, Year 3 2,540
Retained Earnings, December 31, Year 1 14,130
Wages Payable 3,170
What is the amount of current liabilities on the classified balance sheet?
Answer:
The amount of Current liabilities is $7,710
Explanation:
The amount of current liabilities on the classified balance sheet is seen below;
Constable Corp.
Balance sheet as at December 31, year 1.
Current liabilities
Accounts payable $4,540
Wages payable $3,170
Total $7,710
) It can be supposed that an increase in the importance of fitness and wellness in people's lives prompted Apple to include features like the built-in compass and always-on workout apps. That increased importance in fitness is part of the __________________ societal force. a not selected option a economic b not selected option b natural c selected option c cultural d not selected option d demographic e not selected option e political
Answer:
C. Cultural.
Explanation:
Culture can be defined as the general way of life of a group of people living together in a particular location or society.
Basically, culture comprises of beliefs, values, behaviors, language, dressing, cuisine, music, symbols, arts, social habits, knowledge, customs, laws pertaining to a particular group of people living together in a society.
This ultimately implies that, culture are acquired and passed from one generation to another.
A cultural trait can be defined as the smallest characteristics of human activity (actions) that is mainly acquired socially and transmitted from one generation to another through various modes of communication. Thus, these unique behavioral informations or characteristics and beliefs acquired by people socially are transmitted from one individual or group of people to another.
Basically, cultural traits play a significant role in the way of life of a group of people in that it is a unique collection of various cultural elements that are closely related such as behaviors and beliefs.
Hence, it can be supposed that an increase in the importance of fitness and wellness in people's lives prompted Apple to include features like the built-in compass and always-on workout apps. Thus, that increased importance in fitness is part of the cultural societal force because it is a unique assortment of behaviors that distinguish the people.
Milea Inc. experienced the following events in Year 1, its first year of operations:
1. Received $13,500 cash from the issue of common stock
2. Performed services on account for $45,000
3. Pald the utility expense of $1,150.
4. Collected $36,540 of the accounts receivable.
5. Recorded $8,100 of accrued salaries at the end of the year
6. Paid a $1,050 cash dividend to the stockholders.
Required
1. Prepare the income statement
2. Prepare the statement of changes in stockholders' equity
3. Prepare the balance sheet as of December 31.
4. Prepare the statement of cash flows for the Year 1 accounting period.
Answer:
1. Net income = $35,750
2. Stockholders' equity = $48,200
3. Total assets = Total Equity and Liabilities = $56,300
4. Net cash generated = $47,840
Explanation:
1. Prepare the income statement
Milea Inc.
Income Statement
For the Year ended 31 December Year 1
Details Amount ($)
Revenue:
Service income 45,000
Expenses:
Utility expense (1,150)
Accrued salaries (8,100)
Net income 35,750
Dividend paid (1,050)
Retained earnings 34,700
2. Prepare the statement of changes in stockholders' equity
Milea Inc.
Statement of changes in stockholders' equity
For the Year ended 31 December Year 1
Details Amount ($)
Common stock 13,500
Retained earnings 34,700
Stockholders' equity 48,200
3. Prepare the balance sheet as of December 31.
Milea Inc.
Balance Sheet
As of 31 December Year 1
Details $
Assets
Current Assets
Ending cash balance 47,840
Accounts receivable ($45,000 - $36,540) 8,460
Total assets 56,300
Equity and Liabilities
Stockholders' equity 48,200
Liabilities
Current liabilities
Accrued salaries 8,100
Total Equity and Liabilities 56,300
4. Prepare the statement of cash flows for the Year 1 accounting period.
Milea Inc.
Statement of Cash Flows
For the Year ended 31 December Year 1
Details $ $
Net income 35,750
Adjustment to reconcile net income:
(Increase) decrease in current assets:
Accounts receivable ($45,000 - $36,540) (8,460)
Increase (decrease) in current liabilities:
Accrued salaries 8,100
Net cash from operating activities 35,390
Cash flow from financing activities:
Common stock 13,500
Dividend paid (1,050)
Net cash from financing activities 12,450
Net cash generated 47,840
Beginning cash balance 0
Ending cash balance 47,840
Indigo Company exchanged equipment used in its manufacturing operations plus $3,960 in cash for similar equipment used in the operations of Sweet Company. The following information pertains to the exchange.
Indigo Co. Sweet Co.
Equipment (cost) $36,960 $36,960
Accumulated depreciation 25,080 13,200
Fair value of equipment 16,500 20,460
Cash given up 3,960
Required:
a. Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange lacks commercial substance.
b. Prepare the journal entries to record the exchange on the books of both companies. Assume that the exchange has commercial substance.
Answer:
A. Indigo Co
Dr Accumulated depreciation 25,080
Dr Equipment 15,840
Dr Equipment $36,960
Cr Cash 3,960
Sweet Co.
Dr Equipment 16,500
Dr Accumulated depreciation 13,200
Dr Cash 3960
Dr Loss on disposal of equipment 3,300
Cr Equipment $36,960
B. Indigo Complete
Dr Accumulated department 25,080
Dr Equiipment 20,460
Cr Equiipment $36,960
Cr Gain on disposal of equipment 78,540
Cr Cash 3,960
Sweet Co.
Dr Equiipment 16500
Dr Accumulated department 13200
Dr Cash 3960
Dr Loss on disposal of equipment 5660
Cr Equiipment 28,000
Explanation:
a. Preparation of the journal entries to record the exchange on the books of both companies. Assume that the exchange lacks commercial substance.
Indigo Co
Dr Accumulated depreciation 25,080
Dr Equipment 15,840
[$36,960+3,960-25,080]
Dr Equipment $36,960
Cr Cash 3,960
Sweet Co.
Dr Equipment 16,500
Dr Accumulated depreciation 13,200
Dr Cash 3960
Dr Loss on disposal of equipment 3,300
[$36,960-(16,500+13,200+3960)
Cr Equipment $36,960
b. Preparation of the journal entries to record the exchange on the books of both companies. Assume that the exchange has commercial substance.
Indigo Complete
Dr Accumulated department 25,080
Dr Equiipment 20,460
Cr Equiipment $36,960
Cr Gain on disposal of equipment 78,540
[(25,080+20,460+$36,960)-3,960]
Cr Cash 3,960
Sweet Co.
Dr Equiipment 16500
Dr Accumulated department 13200
Dr Cash 3960
Dr Loss on disposal of equipment 5660
(16500+13200+3960-28,000)
Cr Equiipment 28,000
A refrigerator costs $800 on an installment plan that requires a down payment of $140 and monthly payments for 12 months. What are the monthly payments of the plan?
During fiscal 2016, Caleres Inc. (formerly Brown Shoe Company), reported cost of goods sold of $1,517.4 million. Inventory at the start of the year was $546.7 million and at the end of the year was $585.8 million. Which of the following describes the closing entry that the company will make for these accounts?
A. Debit Inventory $39.1 million.
B. Credit Inventory $585.8 million.
C. Credit Cost of goods sold $1,517.4 million.
D. Both A and C.
E. None of the above.
Answer:
Credit Cost of goods sold $1,517.4 million
Explanation:
given data
cost of goods sold = $1,517.4 million
Inventory at the start of the year = $546.7 million
Inventory at the end of the year = $585.8 million
solution
Journal Entry will as
Income Summary DR $1,517.4 million
Cost of goods sold CR $1,517.4 million
so correct option is C. Credit Cost of goods sold $1,517.4 million.
If producing 200 buttons and 200 safety pins
daily is a 50% split of resources, where do we
see the opportunity cost if you decide to
produce 300 buttons and 100 safety pins?
A. The opportunity cost is still at 50%.
B. The opportunity cost is in producing fewer safety pins.
C. The opportunity cost is in the inefficiency of producing to
products.
D. The opportunity cost is in the market share for buttons.
Answer:
The correct option is - B. The opportunity cost is in producing fewer safety pins.
Explanation:
The correct option is - B. The opportunity cost is in producing fewer safety pins.
Reason -
Initially we produce 200 buttons and 200 safety pins and there are 50% split of resources.
Now, If we produce 300 buttons and 100 safety pins and there is no change in the split of resources, then
The opportunity cost of extra 100 buttons is sale amount we would have been getting if we make that 100 safety pins.
In general, a larger R squared tends to suggest that:_______.
a. the estimated sample regression function explains a greater percentage of the total variation in y
b. the estimated sample regression function is more accurate
c. the estimated sample regression function explains a greater percentage of the explained variation in y
d. the estimated slope coefficient is more likely to equal the population slope coefficient
Answer:
c. the estimated sample regression function explains a greater percentage of the explained variation in y
Explanation:
The above is the reason showing the direct correlation between the sample regression and the R Square value.
Problem 4-8 Sales and Growth [LO2] The most recent financial statements for Alexander Co. are shown here: Income Statement Balance Sheet Sales $ 42,950 Current assets $ 17,580 Long-term debt $ 37,070 Costs 35,550 Fixed assets 68,350 Equity 48,860 Taxable income $ 7,400 Total $ 85,930 Total $ 85,930 Taxes (21%) 1,554 Net income $ 5,846 Assets and costs are proportional to sales. The company maintains a constant 35 percent dividend payout ratio and a constant debt-equity ratio. What is the maximum dollar increase in sales that can be sustained assuming no new equity is issued
Answer:
$3,621.96
Explanation:
ROE = Net income/Equity * 100
ROE = 5846/48860*100
ROE = 11.9648%
Dividend payout ratio = 35%
Retention Ratio = 1 - 35% = 65%
Sustainable growth rate = (ROE*b)/(1-ROE*b)
Sustainable growth rate = (11.9648%*0.65)/(1- (11.9648%*0.65%))
Sustainable growth rate = 8.43%
Therefore, Maximum Dollar Increase in sales = Sales * Sustainable growth rate = 42,950 * 8.43% = $3,621.96
PROJECT FOCUS: One day, a sophisticated business man walks into the cafe and asks to speak to the owner. He introduces himself as Brawner Smith and says that he would like to talk to you in private. Brawner has just opened a local record store down the street and would like to purchase your customer lists from music events. Brawner is offering you a rather large sum of money for the e-mail addresses and phone numbers for all of the customers who have attended concerts at the cafe over the past five years. What do you do
Answer:
Explanation:
Solution
At first, we will determine that whether we have communicated to our customers in a past that we will keep their information confidential and never be sold to any other person or business for any future marketing. If we have made such communication, then we should take information confidential and do not give to others.Similarly, if there is no confidentiality communication made in a past, then we can put an offer towards Brawner. We offer him that instead of providing phone numbers and email to him, pay tome, we will email and call the customers and let them know about Brawner and local record store. So in case any customers want something, they will contact directly to you (Brawner) or his shop.
If there is a communication to customers or from customers that the data should be kept private and not shared with anyone, the café owner should not share it.
Decision making based theory:It's crucial to know how the data will be utilised and whether or not it will be shared with the owner of the record store.
Customers should be consulted before the data is shared, and the store owner's details and interest in them should be disclosed.
It makes good commercial sense to provide the data in exchange for money because the café owner has invested a significant amount of time, effort, and money in gathering the information.
An agreement can be reached with the store owner for the sharing of data with other businesses, limiting data usage and avoiding rivalry.
Find out more information about 'Agreement'.
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