Answer:
According to Wiki:
Explanation:
Sacred cow is an idiom, a figurative reference to cattle in religion and mythology. A figurative sacred cow is a figure of speech for something considered immune from question or criticism, especially unreasonably so.
Answer:
Sacred cow is an idiom, a figurative reference to cattle in religion and mythology. A figurative sacred cow is a figure of speech for something considered immune from question or criticism, especially unreasonably so.
Explanation:
In the Ford Pinto Case Study, executives at Ford Motor Co. argued that “if the cost to repair the defect means a potential loss of profit, then we do not repair the defect.” In free market theory, this view makes use of
a.
Pareto efficiency.
b.
intrinsic value.
c.
tradeable property rights.
d.
cost-benefit analysis.
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The view of the executives at Ford Motor Co. uses cost-benefit analysis.
What is the cost-benefit analysis?The cost-benefit analysis refers to the process that is used to determine whether the decision or action is beneficial or not. The profit or beneficial effect of the decision is calculated by considering the cost that is associated with the action.
In the given case the executive consider the cost to repair the defect and observed its effect on the profit. They stated that if the cost to repair the defect causes of potential loss of profit to the company they will not choose to repair the same.
Therefore the correct option is D.
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State one risk and one benefit of being a stockholder.
Answer:
risk : Stockholders aren't guaranteed a return on there investment.
benefit: you can make money on the stock market sometimes at huge rates of growth
Nu Things, Inc., is considering investing in a business venture with the following anticipated cash flow results:
EOY Cash Flow
0 -$70,000
1 $20,000
2 $19,000
3 $18,000
4 $17,000
5 $16,000
6 $15,000
7 $14,000
8 $13,000
9 $12,000
10 $11,000
11 $10,000
12 $9,000
13 $8,000
14 $7,000
15 $6,000
16 $5,000
17 $4,000
18 $3,000
19 $2,000
20 $1,000
Assume MARR is 20 percent per year. Based on an internal rate of return analysis:
Determine the investment.
Answer:
22.27%Company should invest in project.Explanation:
Input the numbers given into an Excel worksheet to find the Internal Rate of Return in the manner shown in the attachment.
The investment will have to be in negative.
The IRR will come out as 22.27%
When evaluating a project based on IRR, invest in the project if the project MARR is less than the IRR as is the case here so the company should invest in this project, all else equal.
Gerhan Company's flexible budget for the units manufactured in May shows $15,640 of total factory overhead; this output level represents 70% of available capacity. During May, the company applied overhead to production at the rate of $3.00 per direct labor hour (DLH), based on a denominator volume level of 6,120 DLHs, which represents 90% of available capacity. The company used 5,000 DLHs and incurred $16,500 of total factory overhead cost during May, including $6,800 for fixed factory overhead. What is the factory overhead efficiency variance (to the nearest whole dollar) for Gerhan Company in May, under the assumption that the company uses a two-variance breakdown (decomposition) of the total overhead variance
Answer:
See below
Explanation:
Given the above information,
Budgeted overhead at 90% capacity = 6,120 × 3 = $18,360
Budgeted overhead at 70% capacity = $15,640
DLH at 70% capacity = 6,120/90% × 70% = 4,760 hours
Variable overhead rate = ($18,360 - $15,640) / (6,120 - 4,760) = $2 per DLH
Actual hours in May = 5,000 DLH
Variable overhead efficiency variance =
(4,750 - 5,000) × $2 = $480 unfavorable
Which of the following items is included in U.S. GDP? Group of answer choices final goods and services that are purchased by the U.S. federal government intermediate goods that are produced in the U.S. but that are unsold at the end of the GDP accounting period goods and services produced by foreign citizens working in the U.S. All of the above are included in U.S. GDP.
Answer:
final goods and services that are purchased by the U.S. federal government
goods and services produced by foreign citizens working in the U.S
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
goods and services produced by foreign citizens working in the U.S
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
At the beginning of the period, the Cutting Department budgeted direct labor of $30,000 and supervisor salaries of $20,000 for 3,000 hours of production. The department actually completed 5,000 hours of production. Determine the budget for the department assuming that it uses flexible budgeting
Answer:
Total labor cost= $70,000
Explanation:
The supervisor salary is a fixed labor cost, it is unlikely that would change with production.
First, we need to calculate the unitary variable direct labor hour:
Unitary variable direct labor hour= 30,000 / 3,000
Unitary labor hour= $10
Now, the flexible budget for 5,000 hours:
Fixed cost= 20,000
Variable cost= 10*5,000= 50,000
Total labor cost= $70,000
Pique Corporation wants to purchase a new machine for $300,000.Management predicts that the machine can produce sales of $200,000 each year for the next 5 years.Expenses are expected to include direct materials,direct labor,and factory overhead (excluding depreciation)totaling $80,000 per year.The firm uses straight-line depreciation with no residual value for all depreciable assets.Pique's tax rate is 40%.Management requires a minimum 10% rate of return on all investments.What is the payback period for the new machine (rounded to nearest one-tenth of a year)? (Assume that the cash inflows occur evenly throughout the year. )
A) 2.5 years.
B) 2.7 years.
C) 3.1 years.
D) 3.6 years.
E) 4.2 years.
Answer:
c
Explanation:
Payback calculates the amount of time it takes to recover the amount invested in a project from it cumulative cash flows
Payback period = Amount invested / cash flow
Cash flow = profit after tax + depreciation
Straight line depreciation expense = (Cost of asset - Salvage value) / useful life
(300,000 - 0) / 5 = $60,000
Profit after tax = (1 - tax rate) x (sales - expenses - depreciation)
0.6 x ($200,000 - $80,000 - $60,000) = $36,000
Cash flow = $36,000 + 60,000 = 96,000
Payback period = $300,000 / $96,000 = 3.1 years
Braun Company has one service department and two operating (production) departments. Maintenance Department costs are allocated to the two operating departments based on square feet occupied. Listed below are the operating data for the current period: Department Direct Expenses Square Feet Maintenance $ 25,500 Milling 76,500 10,000 Assembly 105,400 15,000 The total cost of operating the Assembly Department for the current period is: rev: 12_17_2020_QC_CS-243789 Multiple Choice $91,800. $115,600. $105,400. $120,700. $130,900.
Answer:
$120,700
Explanation:
Calculation to determine what The total cost of operating the Assembly Department for the current period is
First step is to Allocate Maintenance costs to Assembly department
Assembly=$25,500 × (15,000/25 000) >= $15,300
Now let calculate the Total Assembly costs
Total Assembly costs= $105,400 + 15,300
Total Assembly costs= $120,700
Therefore The total cost of operating the Assembly Department for the current period is $120,700
Two of the different data categories for an HRIS database are: Group of answer choices information about people and information about the organization, information about the organization and information about the competitive environment information about people and information about market trends information about people and information about the competitive environment
Answer:
information about people and information about the organization.
Explanation:
A database management system (DBMS) can be defined as a collection of software applications that typically enables computer users to create, store, modify, retrieve and manage data or informations in a database. Generally, it allows computer users to efficiently retrieve and manage their data with an appropriate level of security.
A data dictionary can be defined as a centralized collection of information on a specific data such as attributes, names, fields and definitions that are being used in a computer database system.
In a data dictionary, data elements are combined into records, which are meaningful combinations of data elements that are included in data flows or retained in data stores.
This ultimately implies that, a data dictionary found in a computer database system typically contains the records about all the data elements (objects) such as data relationships with other elements, ownership, type, size, primary keys etc. This records are stored and communicated to other data when required or needed.
Human Resources Information System (HRIS) is simply used to gather or collect data (informations) about the employee working in an organization.
Hence, two of the different data categories for an HRIS database are information about people (employees) and information about the organization.
Suppose you have just paid a nonrefundable fee of $1,000 for your meal plan for this academic term. This allows you to eat dinner in the cafeteria every evening.
A. You are offered a part-time job in a restaurant where you can eat for free each evening. Your parents say that you should eat dinner at the cafeteria anyway since you have already paid for those meals. Are your parents right? Explain why or why not.
B. You are offered a part-time job in a different restaurant where, rather than being able to eat for free, you receive only a large discount on your meals. Each meal there will cost you $2; if you eat there each evening this semester, it will add up to $200. Your roommate says that you should eat in the restaurant since it costs less than the $1,000 that you paid for the meal plan. Is your roommate right? Explain why or why not.
Answer:
A. Parents are not right
B. Roommate is not right
Explanation:
A.Based on the information given your Parents are NOT right reason been that since the two or both of the meals are free for you to eat from you should therefore eat at either the restaurant or cafeteria that you think or felt will benefits you the most at that point in time.
B..Base on the information given your roommate is NOT right, reason been that you should eat at either the restaurant or cafeteria that you think will benefits you the most which means that you can decide to eat from either of the restaurant which food is free or the restaurant which meal will cost you $2 meal after you value the $2 meal to be truly $2 meal.
Blossom Leasing Company leases a new machine to Sharrer Corporation. The machine has a cost of $65,000 and fair value of $90,500. Under the 3-year, non-cancelable contract, Sharrer will receive title to the machine at the end of the lease. The machine has a 3-year useful life and no residual value. The lease was signed on January 1, 2020. Blossom expects to earn an 8% return on its investment, and this implicit rate is known by Sharrer. The annual rentals are payable on each December 31, beginning December 31, 2020.
Required:
Prepare an amortization schedule that would be suitable for both the lessor and the lessee and that covers all the years involved
Answer:
Note: See the attached excel file for the amortization schedule.
Explanation:
In the attached excel file,since the annual rentals are payable on each December 31, the annual Receipt/Payment is calculated using 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 fair value of the machine = $90,500
P = Annual Receipt/Payment = ?
r = Expected return rate = 8%, or 0.08
n = number of years = 3
Substitute the values into equation (1) and solve for P, we have:
$90,500 = P * ((1 - (1 / (1 + 0.08))^3) / 0.08)
$90,500 = P * 2.57709698724788
P = $90,500 / 2.57709698724788
P = $35,177.03
The long-run aggregate supply curve is vertical because it incorporates the assumptions of Keynesian theory. the economy will gravitate to the position of full employment when all variables are flexible. wages, prices, and interest rates are not flexible in the long run. many inputs are fixed.
Answer:
the economy will gravitate to the position of full employment when all variables are flexible
Explanation:
In Economics, there are primarily two (2) factors which affect the availability and the price at which goods and services are sold or provided, these are demand and supply.
The law of demand states that, the higher the demand for goods and services, the higher the price it would be sold all things being equal. On the other hand, law of supply states that the higher the price of goods and services, the lower the supply.
In order to understand both short-run economic fluctuations and how the economy move from short to long run, we need the aggregate supply and aggregate demand model.
An aggregate supply curve gives the relationship between the aggregate price level for goods or services and the quantity of aggregate output supplied in an economy at a specific period of time.
The long-run aggregate supply curve is vertical because the economy will gravitate to the position of full employment when all variables are flexible.
This simply means that, whatever makes the factors of production such as, land, labor, entrepreneurship, capital, or efficiency to either go up or down would certainly result in fluctuations in the economy of a particular country.
Additionally, the long-run aggregate supply curve would shift rightward when immigration from foreign countries rises or technology improves.
Listed below are sources of law and legal situations. For each of the situations, indicate the letter corresponding to the law tha applies.
SOURCES OF LAW
1. Common law
2. The Securities Act of 1933
3. The Securities Exchange Act of 1934
Legal Situations
A. Form S-1 includes material misstatements of the audited financial statements.
B. The client files a lawsuit against the CPAs for negligence in the performance of tax services.
C. A stockholder sustains a loss when he purchases 100 shares of stock in a public company (issuer) from another stockholder in reliance upon audited financial statements included in Form 10-K.
D. Compiled financial statements of a nonpublic company are discovered to include material misstatements.
E. A quarterly statement (10-Q) of a client is materially mis-stated.
F. A bank loses money that it loaned to an issuer in reliance upon financial statements filed with the SEC.
G. An initial purchaser of bonds of an issuer sustains a loss.
H. A CPA is criminally prosecuted for willingly allowing misstatements in a client's financial statements contained in a registration statement.
I. The initial purchaser of common stock of an issuer sustains a loss.
J. Accounting related consulting services resulted in a system that misstated income of a nonpublic company.
Answer:
A. The Securities Act of 1933
B. Common Law.
C. The Securities Exchange Act of 1934.
D. Common Law.
E. The Securities Exchange Act of 1934
F. Common Law
G. The Securities Act of 1933
H. The Securities Act of 1933
I. The Securities Act of 1933
J. Common Law
Suppose a consumer moves up and to the left along an indifference curve from point A to point B. If the consumer gives up one unit of X (on the horizontal axis), but only requires a small amount of good Y (on the vertical axis) to compensate, then what can we say about the marginal rate of substitution and the slope of the indifference curve between points A and B
Answer: hello options to your question is missing attached below is the complete question
answer : The marginal rate of substitution is low and the indifference curve is relatively flat
Explanation:
What we can say about the marginal rate of substitution and the slope of the indifference curve between points A and B is that the marginal rate of substitution is low and the indifference curve is relatively flat
Along an indifference curve the Total utility will remain unchanged along the curve hence the movement from point A to point B does not change the value of total utility but if the consumer gives up one unit of X and requires a small amount of good Y then we can say the MRS is low
marginal rate of substitution is calculated as ; Δy / Δx
what does CPI stand for and what is it used to measure?
Answer:
Consumer price index; A consumer price index measures changes in the price level of a weighted average market basket of consumer goods and services purchased by households.
When the Federal reserve uses contractionary monetary policy to reduce inflation, it A. sells treasury securities increasing interest rates, leading to a stronger dollar that lowers net exports in an open economy. B. buys treasury securities increasing interest rates, leading to a weaker dollar that increases net exports in an open economy. C. buys treasury securities decreasing interest rates, leading to a weaker dollar that lowers consumption of durables in a closed economy. D. sells treasury securities decreasing interest rates, leading to a stronger dollar that lowers domestic investment in a closed economy.
Answer:
A. sells treasury securities increasing interest rates, leading to a stronger dollar that lowers net exports in an open economy.
Explanation:
The Federal Reserve System ( popularly referred to as the 'Fed') was created by the Federal Reserve Act, passed by the U.S Congress on the 23rd of December, 1913. The Fed began operations in 1914 and just like all central banks, the Federal Reserve is a United States government agency.
Generally, it comprises of twelve (12) Federal Reserve Bank regionally across the United States of America.
Like all central banks, the Federal Reserve is a government agency that is saddled with the following responsibilities;
I. The Fed controls the issuance of currency in United States of America: it promotes public goals such as economic growth, low inflation, and the smooth operation of financial markets.
II. It provides banking services to all the commercial banks in the country because the Federal Reserve is the "lender of last resort."
III. It regulates banking activities in the United States of America: it has the power to supervise and regulate banks.
Fiscal policy in economics refers to the use of government expenditures (spending) and revenues (taxation) in order to influence macroeconomic conditions such as Aggregate Demand (AD), inflation, and employment within a country. Fiscal policy is in relation to the Keynesian macroeconomic theory by John Maynard Keynes.
A fiscal policy affects combined demand through changes in government policies, spending and taxation which eventually impacts employment and standard of living plus consumer spending and investment.
Generally, the government of a particular country could use a contractionary policy to slow down the economy when inflation is high and gross domestic product (GDP) is growing too.
Hence, when the Federal reserve (government) of the United States of America uses contractionary monetary policy to reduce inflation, it sells treasury securities at an increasing (high) interest rates, which eventually leads to a stronger dollar that lowers net exports (total trade) in an open economy.
In which of the following does the seller of a product or service have the LEAST amount of control over the price?
O A. Natural monopoly
O B. Privatization
OC. Oligopoly
OD. Perfect competition
O E. Monopolistic competition
Answer:
'd' perfect competition
Explanation:
since there is a high competition and has to go according to the market. if the competetor is selling the same product in lower price the seller should decrease there price also . to attract the buyers
In a market having perfect competition, the seller of a product or service has the least amount of control over the price of such product or service. Therefore, the option D holds true.
What is the significance of perfect competition?A market having perfect competition can be referred to or considered as a market where a large number of buyers and sellers come together to trade a similar product or service. There is free entry and exit in a perfectly competitive market.
Moreover, there is no scope for price control or manipulation by the seller in a perfect competition because the seller does not have the pricing power, mainly because there are a large number of sellers dealing in similar products, and thus, the price remains the same in the whole market.
Therefore, the option D holds true regarding the significance of perfect competition.
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The unique way that employees interact with each other and their customers. Also, the personality of the company
Answer:
A
Explanation:
Company Culture. Or Organizational Culture
The unique way that employees interact with each other and their customers. Also, the personality of the company is the Company Culture. Hence, option A is correct.
The beliefs, standards, and behaviors that make up the organization's culture have an impact on and direct the conduct of every team member. Think of it as the range of traits that characterize your company.
A company's "business culture" or "organizational culture" refers to its common ideals, attitudes, and behaviors. Your company's culture greatly affects how content your staff members are on the whole.
Organizational culture is generally defined as all of a company's beliefs, values, and attitudes, as well as how these influence how its employees behave. Culture has an impact on what it's like for a customer to make a purchase from a firm or for a supplier to work with one.
Thus, option A is correct.
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When Teri's outside basis in the TMF Partnership is $80,000, the partnership distributes to her $30,000 cash, an account receivable (fair market value of $60,000, inside basis to the partnership of $0), and a parcel of land (fair market value of $60,000, inside basis to the partnership of $80,000). Teri remains a partner in the partnership, and the distribution is proportionate to the partners.
If an amount is zero, enter "0".
Complete the table below by using the format of Concept Summary 11.1 to calculate the effects of the distribution.
Note: If you use Excel to set up the table, designate the input area for the amounts on lines 1, 2, 5, and 8. Code the formulas shown in the Calculations section of the concept summary to calculate the amounts in the remaining lines. You will use "sum," "min," and "max"
TUTTICO Input Line 1 Partner's outside basis 80,000 Line 2 Step 1. Cash and deemed cash distributed 30,000 Line 5 Step 2. Partnership's basis in distributed hot assets Line 8 Step 3. Partnership's basis in other distributed property Proportionate Liquidating Distribution Calculations Line 1 Partner's outside basis Line 2 Step 1. Cash and deemed cash distributed Line 3 Gain recognized by partner Line 4 Partner's remaining outside basis Line 5 Step 2. Partnership's basis in distributed hot assets $i Line 6 Partner's basis in distributed hot assets Line 7 Partner's remaining outside basis Line 8 Step 3. Partnership's basis in other distributed property $ Line 9 Partner's basis in other distributed property $ Line 10 Partner's remaining outside basis
Answer:
Below
Explanation:
In the picture
The Work in Process Inventory account of a manufacturing company has a $3,550 debit balance. The company applies overhead using direct labor cost. The cost sheet of the only job still in process shows direct material cost of $1,610 and direct labor cost of $870. Therefore, the amount of applied overhead is:
Answer:
$1,070
Explanation:
Calculation to determine the amount of applied overhead is:
Using this formula
Applied overhead = Total cost of WIP - Direct materials - Direct labor
Let plug in the formula
Applied overhead= $3,550 - $1,610 - $870
Applied overhead=$1,070
Therefore the amount of applied overhead is:$1,070
Bates Company issued $1,000,000, 10-year bonds. It agreed to make annual deposits of $78,000 to a fund (called a sinking fund), which will be used to pay off the principal amount of the bond at the end of 10 years. The deposits are made at the end of each year into an account paying 6% annual interest. What amount will be in the sinking fund at the end of 10 years
Answer:
FV= 1,243,119.12
Explanation:
Giving the following information:
Annual deposit= $78,000
Number of periods= 10 years
Interest rate= 0.1
To calculate the future value, we need to use the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
FV= {78,000*[(1.1^10) - 1]} / 0.1
FV= 1,243,119.12
Moonbeam Company manufactures toasters. For the first 8 months of 2020, the company reported the following operating results while operating at 75% of plant capacity:
Sales (358,400 units) $4,377,000
Cost of goods sold 2,590,720
Gross profit 1,786,280
Operating expenses 837,760
Net income $948,520
Cost of goods sold was 70% variable and 30% fixed; operating expenses were 80% variable and 20% fixed. In September, Cullumber receives a special order for 24,500 toasters at $8.38 each from Luna Company of Ciudad Juarez. Acceptance of the order would result in an additional $2,900 of shipping costs but no increase in fixed costs.
Required:
Prepare an incremental analysis for the special order.
Answer:
Net Income will increase by $32,625
Explanation:
The Incremental analysis for the special order is done below:
Reject Order Accept Order Net Income -
Increase/(decrease)
Revenue $0.00 $205,310 $205,310
Cost of goods Sold $0.00 ($123,970) ($123,970)
Operating Expense $0.00 ($48,715) ($48,715)
Net Income $0.00 $32,625 $32,625
Revenue
This is calculated by multiplying the number of units of special order with the price per unit i.e. $8.38. As shown below:
24,500 x $8.38 = $205,310
Cost of Goods Sold
As there is only change in the variable cost due to the manufacturing of additional units. Therefore, we would calculate the additional variable cost by multiplying the number of units with the variable cost per unit.
Variable Cost per unit = (2,590,720 * 70%) / 358,400 units = $5.06 per unit
Cost of Goods Sold = 24,500 x $5.06 = $123,970
Operating expense
As there is only change in the variable cost due to the manufacturing of additional units. Therefore, we would calculate the additional variable cost by multiplying the number of units with the variable cost per unit. Then we would add the additional shipping cost of $2,900/
Operating Expense Variable Cost per unit = (837,760 * 80%) / 358,400 units = $1.87 per unit
Operating Expense = 24,500 x $1.87 = $45,815 + $2900 = $48,715
Byron Corp is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $100,000. The equipment will have an initial cost of $400,000 and have a 5 year life. The salvage value of the equipment is estimated to be $75,000. If the hurdle rate is 10%, what is the approximate net present value
Answer:
$25,647.78
Explanation:
The Net Present Value is the value today of future cashflows discounted by the effective interest rate. In this case the interest rate is the hurdle rate of 10%.
Using a financial calculator, this will be calculated by the CFj function as follows :
($400,000) CF 0
$100,000 CF 1
$100,000 CF 2
$100,000 CF 3
$100,000 CF 4
$175,000 CF 5
i/yr = 10%
then SHIFT NPV
Inputting the data in the calculator above, we get a net present value of $25,647.78
Think back to our discussions of changes in total revenue and price and how the concept of elasticity was used. When a firm decreases price and demand is elastic, the percentage change in quantity demanded will be A) ______________ (greater than / less than) the percentage change in price. Therefore, revenue will B) ______________ (increase / decrease). If the demand is inelastic, total revenue will C) ______________ (increase / decrease) when price decreases.
Answer:
(greater than
increase
decrease
Explanation:
Price elasticity of demand measures the responsiveness of quantity demanded to changes in price of the good.
Price elasticity of demand = percentage change in quantity demanded / percentage change in price
If the absolute value of price elasticity is greater than one, it means demand is elastic. Elastic demand means that quantity demanded is sensitive to price changes.
Demand is inelastic if a small change in price has little or no effect on quantity demanded. The absolute value of elasticity would be less than one
Chapter 14: Applying Excel Data Example E Cost of equipment needed $60,000 Working capital needed $100,000 Overhaul of equipment in four years $5,000 Salvage value of the equipment in five years $10,000 Annual revenues and costs: Sales revenues $200,000 Cost of goods sold $125,000 Out-of-pocket operating costs $35,000 Discount rate 14% Enter a formula into each of the cells marked with a
Answer:
Net present value (NPV) = $31,493
Explanation:
Note: This question is not complete. The complete question is therefore provided before answering the question. See the upper part of Sheet1 of the attached excel file for the complete question.
Also note: See the lower part of Sheet1 of the attached excel file for the answer to this question.
From the the lower part of Sheet1 of the attached excel, we have:
Net present value (NPV) = $31,493
You have been offered an investment that will pay you a lump sum of $30,000 25 years from today, along with a payment of $1,000 per year for 25 years starting one year from today. How much are you willing to invest today to have this investment in your portfolio assuming you wish to earn a rate of 6 percent compounded annually
Answer:
$5,793.40
Explanation:
The amount you invest is called the Principle Value (PV). Therefore the question requires us to determine the Principle Amount that will pay you a lump sum of $30,000 25 years from today.
FV = $30,000
N = 25
PMT = ($1,000)
P/Yr = 1
I = 6 %
PV = ?
Using a Financial Calculator to input the values as shown above, the Principle Value (PV) is calculated as $5,793.40.
Therefore, you will be willing to invest $5,793.40 today to have this investment in your portfolio
On November 30, Petrov Co. has $140,200 of accounts receivable and uses the perpetual inventory system. Dec. 4 Sold $9,430 of merchandise (that had cost $6,035) to customers on credit, terms n/30. 9 Sold $19,628 of accounts receivable to Main Bank. Main charges a 4% factoring fee. 17 Received $5,187 cash from customers in payment on their accounts. 27 Borrowed $11,216 cash from Main Bank, pledging $14,581 of accounts receivable as security for the loan.
Prepare journal entries to record the above selected July transactions. (The company uses the perpetual inventory system.) (If no entry is required for a particular transaction, select "No journal entry required" in the first account field.)
Date General Journal Debit Credit July 2July 04 No Transaction Recorded 3July 09 No Transaction Recorded 4ly 17 No Transaction Recorded 5ly 27 No Transaction Recorded
Answer:
Petrov Co.
Journal
Date Account Titles Debit Credit
Dec. 4 Accounts receivable $9,430
Sales revenue $9,430
To record the sale of goods on account, terms n/30.
Dec. 4 Cost of goods sold $6,035
Inventory $6,035
To record the cost of goods sold.
Dec. 9 Cash (Main Bank) $18,843
Finance charges $785
Accounts Receivable $19,628
To record the factoring of accounts receivable for cash.
Dec. 17 Cash $5,187
Accounts receivable $5,187
To record the receipt of cash from customers on account.
Dec. 27 Cash $11,216
Finance charges $3,365
Bank Loan $14,581
To record the pledge of accounts receivable as security for a loan
Explanation:
a) Data and Transaction Analysis:
Dec. 4 Accounts receivable $9,430 Sales revenue $9,430, terms n/30.
Dec. 4 Cost of goods sold $6,035 Inventory $6,035
Dec. 9 Cash (Main Bank) $18,843 Finance charges $785 Accounts Receivable $19,628
Dec. 17 Cash $5,187 Accounts receivable $5,187
Dec. 27 Cash $11,216 Finance charges $3,365 Bank Loan $14,581
Suppose that business travelers and vacationers have the following demand for airline tickets from New York to Boston:
Price Quantity Demanded by Business Travelers Quantity Demanded by Vacationers (Dollars)
150 2,100 (Tickets) 1,000 (Tickets)
200 2,000 800
250 1,900 600
300 1,800 400
Required:
a. As the price of tickets rises from $200 to $250, what is the price elasticity of demand for (i) business travelers and (ii)vacationers? (Use the midpoint method in your calculations.)
b. Why might vacationers have a different elasticity from business travelers?
Answer and Explanation:
a. The computation of the price elasticity of demand is
i. For business travelers
= {(1900 - 2000) ÷ [(1900 + 2000) ÷2]} ÷ {(250 - 200) ÷ [(200 + 250) ÷ 2]}
= 0.23
ii. For Vacationers
= {(800 - 600) ÷ [(800 + 600) ÷ 2]} ÷ {(250 - 200) ÷ [(200 + 250) ÷ 2]}
= 1.29
b. Since the price would increase from $200 to $250 so the price elastiicy of business travelers & vactationers is 0.23 and 1.29 respectively. So the demand for for airline tickets would be more elastic for vacationers as the business travelers would be less senstitive for price change
Chiptech, Inc., is an established computer chip firm with several profitable existing products as well as some promising new products in development. The company earned $2.1 a share last year, and just paid out a dividend of $0.84 per share. Investors believe the company plans to maintain its dividend payout ratio at 40%. ROE equals 23%. Everyone in the market expects this situation to persist indefinitely.
a. What is the market price of Chiptech stock? The required return for the computer chip industry is 16%, and the company has just gone ex-dividend (i.e., the next dividend will be paid a year from now, at t = 1). (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
Market price of Chiptech stock $
b. Suppose you discover that Chiptech
Answer and Explanation:
The computation is shown below:
a) Growth rate = ROE × retention ratio
= 23% × (1 - .40)
= 13.80%
Value of stock = D1 ÷ (k - g)
= 0.84 × (1 + .1380) ÷ (.16 - .1380)
= $43.45
b) Revised growth rate after year 2 = 16% × .50
= 8%
Value at T2 = D3 ÷ (k - g)
D3 = Earnings × (1 + G1)^2 × (1 + G2) × Payout ratio
= 2.1 × (1+.1380)^2 × (1+.08) × .50
= 1.47
Value at T2 = 1.47 ÷ (.16 - .08)
= $18.38
Value at T0 = Value at T2 ÷ (1 + r)^n
= 18.38 ÷ (1 + .16)^2
= 13.66
Milar Corporation makes a product with the following standard costs: Standard Quantity or Hours Standard Price or Rate Direct materials 4.0 pounds $ 3.50 per pound Direct labor 0.8 hours $ 20.00 per hour Variable overhead 0.8 hours $ 9.00 per hour In January the company produced 3,310 units using 13,240 pounds of the direct material and 2,768 direct labor-hours. During the month, the company purchased 14,000 pounds of the direct material at a cost of $35,100. The actual direct labor cost was $54,960 and the actual variable overhead cost was $23,860. The company applies variable overhead on the basis of direct labor-hours. The direct materials purchases variance is computed when the materials are purchased. The labor rate variance for January is:
Answer:
Direct labor rate variance= $415.2 favorable
Explanation:
Giving the following information:
Direct labor 0.8 hours $ 20.00 per hour
In January the company produced 3,310 units using 2,768 direct labor hours.
The actual direct labor cost was $54,960
To calculate the direct labor rate variance, we need to use the following formula:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Quantity
Actual rate= 54,960 / 2,768= $19.85
Direct labor rate variance= (20 - 19.85)*2,768
Direct labor rate variance= $415.2 favorable