Answer:Pre-planning
Explanation:
Answer:
Explanation:
Implementation and Monitoring are latter phases of a project. Pre-planning goes before Planning so the answer is B.
A company's current assets are $30000 and current liabilities are $19000. Calculate the company's current ratio as a percentage. Does the company have enough assets to pay its liabilities?
Answer:
Current Ratio (in %) = 157.89473684211% rounded off to 157.89%
The current ratio of 157.89% means that the company has 157.89% of current assets to pay off 100% or all of its current liabilities. To understand it better, we can say that to pay off every $1 of current liability, the company has $1.5789 of current assets. Thus, the company has enough current assets to pay off its current liabilities.
Explanation:
The current ratio is a measure of liquidity of a business. It is calculated by dividing the current assets by the current liabilities of the company. To express current ratio in a percentage form, we use the following formula,
Current Ratio (in %) = [Current Assets / Current Liabilities] * 100
Current Ratio (in %) = [30000 / 19000] * 100
Current Ratio (in %) = 157.89473684211% rounded off to 157.89%
Answer:
Part 1
1.58
Part 2
the company does not have enough assets to pay its liabilities.
Explanation:
Current ratio = Current Assets ÷ Current Liabilities
therefore,
Current ratio = $30000 ÷ $19000 = 1.58
conclusion
A current ratio of above 2.0 is usually preferred, therefore the company does not have enough assets to pay its liabilities.
All yearly government spending is broken up into two categories; Mandatory spending which is required by law and Discretionary spending which is spending that must be approved each year by Congress.
Mandatory spending is spending that is required by current law. Most federal mandatory spending is in the form of safety net and entitlement programs, including the Food Stamp program, Social Security, Medicaid, and Medicare. Safety net programs represent “transfer payments” by which the government redistributes the income of the taxpayers by collecting taxes and providing services for those less fortunate and who do not provide any type of good or service in return. Entitlement expenditures include Medicaid and Social Security in which money that has been collected from taxpayers is then given back to those that contributed once they reach a certain age or meet other requirements. Other forms of mandatory spending include veterans benefits. For example, being a veteran means that you have already provided a service for which you were guaranteed, by law, certain benefits and payments (salary once you served your term/retirement, college benefits once you served your term, health insurance after you served your term, etc.). Because the law requires that these benefits be paid once the military personnel has served their term, these expenditures are mandatory and are automatically included in the US budget each year. The amount included for these expenditures is based on the number of citizens who “qualify” for these payments whether safety net, entitlement, or veteran benefits. Many other mandatory expenditures fall under the US budget. Over half of the entire US budget is mandatory which means that it cannot be changed without a change to the law.
About one-third of federal spending is Discretionary. This means that while this spending is for programs that are considered necessary to the operation of the US, they must be re-approved each year by Congress through a vote. The largest category of Discretionary spending is National Defense which must be approved each year. Other categories of Discretionary spending include education assistance, Interstate transportation programs, national parks, the Justice / Court system, and science, space, and technology research programs.
An appropriation is an Act which congress passes to approve discretionary spending. For example, one category of spending on education may be mandatory but congress may want to increase spending through an appropriation (or a special vote) which places the extra spending under the discretionary piece of the budget. One example of an appropriation that increased mandatory spending in the US annual budget is that of the Veteran’s Choice program. Veteran’s health benefits are required by law (they have served and part of their payment for serving is free health care after they retire). However, to receive their health benefits veterans have historically been required to utilize specific Doctors and hospitals. This is the law and therefore part of the mandatory budget. However, an appropriation was passed in 2019 which added extra funding to allow veterans to visit any Doctor they chose and be treated at any hospital of their choosing. The funding for this change is part of the discretionary budget and had to be approved by congress.
Questions:
1) Name and define the two types of spending that are included in the US budget each year.
2) What does it mean that mandatory spending is spending required by law? Give an example.
3) How much of the US yearly budget is required by law?
4) Who must vote to approve additional (Discretionary) spending each year?
5) What is the largest category of spending that must be voted on each year?
6) What is appropriation? Give an example.
Answer:
In the decade leading up to the Great Recession, the government kept federal spending below 20% of GDP. It grew no faster than the economy, around 2% to 3% per year. During the recession, spending grew to a record 24.4% of GDP in FY 2009. This increase was due to economic stimulus and two overseas wars.3
Explanation:
At the same time, growth slowed, which reduced tax receipts. Congress worried about the ballooning U.S. debt. No one could agree on how to reduce it. As a result, Congress enacted across-the-board budget cuts, called "sequestration."4 That finally reduced spending to 20.4% of GDP in FY 2015.5
Since then, spending has crept up again despite the sequester. Congress and the president rely on deficit spending to boost economic growth.6 But deficit spending is out of control. It rises each year, even when the economy is doing well.
You currently own 900 shares of JKL which is an all-equity firm with 250,000 shares of stock outstanding at a market price of $40 a share. The company's earnings before interest and taxes are $120,000. JKL has decided to issue $1 million of debt at 6.5 percent interest and use the proceeds to repurchase shares of stock. How many shares of JKL stock must you sell to unlever your position if you can loan out funds at 6.5 percent interest
Answer:
90 shares
Explanation:
Calculation to determine How many shares of JKL stock must you sell to unlever your position if you can loan out funds at 6.5 percent interest
First step is to calculate Your initial investment
Your initial investment = 900 x $40
Your initial investment = $36,000
Second step is to calculate JKL value of stock
JKL value of stock = [250,000 - ($1M/$40)] x $40 JKL value of stock = $9M
Third step is to calculate JKL Total value
Value of Debt = 1M
JKL Total value = 9M + 1M
JKL Total value = 10M
Fourth Step is to calculate You new stock position
JKL Wight Stock = 9M/10M = 9/10
You new stock position = [9/10($36,000)]/10
You new stock position= $32,400/40
You new stock position=810 shares
Now let calculate the Number shares sold
Number shares sold = 900 Shares - 810 Shares
Number shares sold = 90 shares
Therefore the numbers or shares of JKL stock that must you sell to unlever your position if you can loan out funds at 6.5 percent interest is 90 shares
What time of the year does tax day always occur in the US
Answer:
Around April 15th!
Explanation:
Every year except this year has been April 15th! But since CO VID- 19 hit the IRS pushed it back until May 17th! Hope this helps! Plz mark as brainliest!
Answer:
the date is usually on or around April 15
Please Help answering both questions
1. Think about the business cycle; What are the parts of the business cycle? How does each part of the business cycle impact employment?
2. Think about economic indicators; What is GDP and how does it show if an economy is doing well or poorly? Describe two ways that a GDP shows overall whether an economy is doing well or poorly.
Answer:
Explanation:
An economic cycle, also referred to as a business cycle, has four stages: expansion, peak, contraction, and trough.
Unemployment increases during business cycle recessions and decreases during business cycle expansions (recoveries). If the equilibrium level of output is less than the full employment level as illustrated on the graph above, this indicates that some available resources are unemployed and less is being produced.
GDP is important because it gives information about the size of the economy and how an economy is performing. The growth rate of real GDP is often used as an indicator of the general health of the economy. In broad terms, an increase in real GDP is interpreted as a sign that the economy is doing well.
How can you tell if the economy is doing well or badly? GDP - or economic growth. This is a measure of all the goods and services produced in a country over a period of time, for example, a year. An increase means the economy is growing.
YOU BETTER READ ALL OF THIS1 points eBookPrintReferencesItem 2 On December 29, year 7, Almond Company granted 100,000 stock options to a group of 100 employees, enabling each employee to buy 1,000 shares for $20 per share. On the grant date, the shares had a market value of $16 per share and the options had a market value of $3.00 per option. The options vest over a 3-year period and become exercisable on January 1, year 11. Almond Company expects that, based on historical turnover, they will lose approximately 3 of the employees receiving the options per year during the vesting period. Compensation expense will be recognized uniformly over the vesting period. How much compensation expense will Almond Company recognize in year 8
Explanation:
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Hammes Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During February, the company budgeted for 5,500 units, but its actual level of activity was 5,510 units. The company has provided the following data concerning the formulas to be used in its budgeting: Fixed element per month, Variable element per unit:
Revenue −−−−, $ 43.10
Direct labor $ 0, $ 6.20
Direct materials 0, 15.70
Manufacturing overhead 47,800, 1.40
Selling and administrative expenses 27,300, 0.70
Total expenses $ 75,100, $ 24.00
The activity variance for net operating income in February would be closest to:
A. $191 U
B. $1,651 U
C. $191 F
D. $1,651 F
Answer:
c. $191 Favorable
Explanation:
Flexible budget Planning budget Activity variance
Units produced 5,510 units 5,500 units
Revenue $237,481 $237,050
Total Expenses ($207,340) ($207,100)
Net Operating Income $30,141 $29,950 $191 F
Workings
Flexible budget revenue = 5,510 units*$43.10 = $237,481
Planning budget revenue = 5,500 units*$43.10 = $237,050
Flexible budget expenses = $75,100 + $24*5510 = $207,340
Planning budget expenses = $75,100 + $24*5500 = $207,100
how can gdp per capita and poverty rates indicate standards of living in each system?
Producer surplus in a perfectly competitive industry is the same thing as revenue. the difference between profit at the profit-maximizing output and profit at the profit-minimizing output. the difference between revenue and fixed cost. the difference between revenue and variable cost. the difference between revenue and total cost.
Answer:
the difference between revenue and variable cost
Explanation:
As we know that
Producer surplus is = Total Revenue - Total Variable Cost
So here we can see that the producer surplus would be the difference between the revenue & the variable cost in the industry i.e. perfectly competitive
Hence, the second last option is correct
And, the other options are wrong
Presented below are partial October, November, and December cash budgets for Holidays Events. Loans are obtained in increments of $1,000 at the start of each month to maintain a minimum end-of-month balance of $12,000. Interest is one percent simple interest (no compounding) per month, payable when the loan is repaid. Repayments are made as soon as possible, subject to the minimum end-of-month balance.
Required:
Complete the short-term financing section of the cash budget and all missing figures
October November December Total
Cash balance, beginning $24,0005
Collection on sales 36,000 41,000 81,000
Cash available for operations
Disbursements for operations (51,000) (61,000) (40,000)
Ending cash before borrowings or replacements
Short-term finance:
New loans
Repayments
Interest
Cash balance, ending
Answer:
Holidays EventsCash Budget
October November December Total
Cash balance, beginning $24,000 $12,000 $12,000 $24,000
Collection on sales 36,000 41,000 81,000 158,000
Cash available for operations $60,000 $53,000 $93,000 $182,000
Disbursements for operations (51,000) (61,000) (40,000) (152,000)
Ending cash before borrowings
or repayments $9,000 ($8,000) $53,000 $30,000
Short-term finance:
New loans 3,000 20,000 23,000
Repayments (23,260) (23,260)
Interest 30 230 0
Cash balance, ending $12,000 $12,000 $29,740 $29,740
Explanation:
a) Data and Calculations;
Loans obtained in increments of $1,000
Minimum end-of-month balance = $12,000
Simple Interest rate = 1% per month
Cash Budget
October November December Total
Cash balance, beginning $24,000 $12,000 $12,000 $24,000
Collection on sales 36,000 41,000 81,000 158,000
Cash available for operations $60,000 $53,000 $93,000 $182,000
Disbursements for operations (51,000) (61,000) (40,000) (152,000)
Ending cash before borrowings
or repayments
Short-term finance:
New loans
Repayments
Interest
Cash balance, ending
b) Holidays' Cash Budget is a Schedule that estimates the cash inflows and outflows during a period of its financial cycle. The purpose of preparing one is to determine availability of cash for continuing operational activities. In addition, the Cash Budget shows when Holidays needs to borrow cash to continue operations. Excess cash is also determined from the Cash Budget for investment purposes.
In the U.S. trade deficit during the 1980s was due largely to the rise in the U.S. budget deficit. On the other hand, some in the popular press have claimed that the increased trade deficit resulted from a decline in the quality of U.S. products relative to foreign products. Assume that U.S. products did decline in relative quality during the 1980s. This caused net exports at any given exchange rate to: __________
Answer: Decline
Explanation:
If U.S. goods fall in quality, less people will demand the goods which will lead to a fall in U.S. exports.
As U.S. goods are denominated in dollars, a fall in the demand for US exports is akin to a fall in demand for the US dollar.
The US dollar gets weaker so the exports at every exchange rate will fall.
Net exports is calculated by subtracting imports from exports so net exports will decline as a result of exports falling.
Raphael's Performance Pizza is a small restaurant in San Diego that sells gluten-free pizzas. Raphael's very tiny kitchen has barely enough room for the four ovens in which his workers bake the pizzas. Raphael signed a lease obligating him to pay the rent for the four ovens for the next year. Because of this, and because Raphael's kitchen cannot fit more than four ovens, Raphael cannot change the number of ovens he uses in his production of pizzas in the short run.
However, Raphael's decision regarding how many workers to use can vary from Raphael lets them know how many workers he needs for each day of the week. week to week because his workers tend to be students. Each Monday,
In the short run, these workers are _________ inputs, and the ovens are ________ inputs.
Answer:
In the short run, these workers are VARIABLE inputs, and the ovens are FIXED inputs.
Explanation:
Workers are variable inputs since Raphael can decide to change the number of employees hired every week or every certain period of time. On the other hand, the number of ovens cannot change immediately since Rapheal would need to move to some other place in order to increase the number of ovens.
Rates and taxes
amount to R 14000
per month, and must
be apportioned in
relation to floor space
(the factory takes up
75% of the total floor
space of the entire
premises
Answer:
The Rates and Taxes:
Factory = R 10,500
Office = R 3,500
Explanation:
a) Data and Calculations:
Total amount for Rates and Taxes = R 14,000
Factory space = 75%
Therefore, office space = 25% (100 - 75%)
Apportionment of the Rates and Taxes for the month:
Factory = R 10,500 (R 14,000 * 75%)
Office = R 3,500 ( R 14,000 * 25%)
b) Each function of the business entity is apportioned a part of the Rates and Taxes according to the size of the floor space they take up. This shows that Rates and Taxes are dependent on floor space.
The company is now using only 70% of its normal capacity; it could fully use its normal capacity by processing the assembly further and selling it for $51 per unit. If the company does this, material and labor costs will each increase by $2 per unit and variable overhead will go up by $1 per unit. Fixed costs will increase from the current level of $160,000 to $225,000. Prepare an analysis showing whether Jensen should process the assemblies further.
Use a negative sign with answer to only indicate a loss from processing assemblies further; otherwise do not use negative signs with your answers.
Sell of Process Further Differential Analysis
Differential revenue
Differential costs
Direct material
Direct labor
Variable overhead
Fixed costs
Additional income (loss) from processing further $
Question Completion:
Jensen Manufacturing Company makes a partially completed assembly unit that it sells for $36 per unit. Normally, 42,000 units are sold each year. Variable unit cost data on the assembly are as follows:
Direct material $10
Direct labor 8
Variable manufacturing overhead 4
Answer:
Jensen Manufacturing CompanySell or Process Further Differential AnalysisDifferential revenue $630,000
Differential costs
Direct material -84,000
Direct labor -84,000
Variable overhead -42,000
Fixed costs -65,000
Additional income (loss) from processing further $355,000
Explanation:
a) Data and Calculations:Sell Process Further Difference
Sales price per unit $36 $51 $15
Costs:
Direct material $10 12 2
Direct labor 8 10 2
Variable manufacturing
overhead 4 5 1
Fixed costs $160,000 $225,000 $65,000
Normal annual production and sales = 42,000 units
Differential revenue = $630,000 ($15 * 42,000)
Differential costs:
Differential direct material cost = $84,000 ($2 * 42,000)
Differential direct labor cost = $84,000 ($2 * 42,000)
Differential overhead cost = $42,000 ($1 * 42,000)
Differential fixed cost = $65,000 ($225,000 - $160,000)
Total differential costs = $275,000
b) Jensen Manufacturing should process the assembly units further as it will gain additional $355,000 income by so doing.
Suppose people expect inflation to equal 3 percent but in fact, prices have risen by 5%. Describe how this unexpectedly high inflation would help or hurt these individuals?
a. The US government
b. A homeowner with a fixed-rate mortgage
c. Union Worker in the second year of a fixed raise labor contract.
d. A college that has invested some of it endowment in government bonds.
The major advantage of margin trading is the
Answer:
The appropriate response is "Margin trading can influence a far bigger place".
Explanation:
The given topic Trading on margins offers shareholders not just the possibility of taking more opportunities unlike average, and perhaps moreover versatility for purchasing many more securities.Whilst also investing even from one's dealer, clients can leverage a far bigger role and use only existing leverages.Research question
Technology ,good or bad has a major impact on the way we do things Explain how technology influences the way we make decisions and do business in the logistics and supply chain arena
Answer:
Technology makes work more agile, safer and facilitates the organizational decision-making process.
Explanation:
Technology is essential in the area of logistics and supply chain in a competitive and globalized business environment, due to the fact that technology enables greater reliability in the processes and an aid in the organizational decision-making process.
Supply chain management with the use of technological systems becomes much more effective, due to the amount of data that such systems are able to store, in the speed of processes, in the monitoring of transport, in increasing the security and reliability of information, and other solutions that make work faster, safer, with less waste and improvement of continuous improvement.
choosing to sell your house
is an example of property rights providing the right for you to
enjoy property
control property
exchange property
own property
Answer:
d. own property
Explanation:
it is not a right to enjoy, control or exchange. but it is your right to own
How can life expectancy and literacy rates affect the quality of labor in the economy?
Answer:
Healthier and better educated labor force = more productive and inventive.
A young couple has made a nonrefundable deposit of the first month’s rent (equal to $1,000) on a 6-month apartment lease. The next day they find a different apartment that they like just as well, but its monthly rent is only $900. They plan to be in the apartment only 6 months. Should they switch to the new apartment? What if they plan to stay 1 year? Assume an interest rate of 12%
Answer:
Should they switch to the new apartment? If they plan to stay 6 months.
No, since the difference in rent is too small and it is simply not worth it.
If they were planning to saty in teh new apartment for 1 year, they would need to find the epresent value of the difference between one apartment and the other = $100 x 11.255 (PVIFA, 1%, 12 peridos) = $1,125.50. This amount is higher than the initial deposit, so they should choose the other apartment.
Iona wrote her will. The following year, she wrote another will that expressly revoked the earlier will.Later, while cleaning house, she came across the second will. She mistakenly thought that it was the first will and tore it up because the first will had been revoked. Iona died shortly thereafter.The beneficiaries named in the second will claimed that the second will should be probated.The beneficiaries named in the first will claimed that the second will had been revoked when it was torn up. Had the second will been revoked?
Answer and Explanation:
In the given case, the second will would be destroyed non-intentionally by the testatrix that represent the person who writes the will. Also the second will would have be intended to revoke the first will
In addition to this, Testatrix intends the second will to be value also at the same time she dont want the first will to be probated
So the second will would be upheld because of testamentary motive.
The calculation of WACC involves calculating the weighted average of the required rates of return on debt, preferred stock, and common equity, where the weights equal the percentage of each type of financing in the firm’s overall capital structure. is the symbol that represents the before-tax cost of debt in the weighted average cost of capital (WACC) equation. Mitchell Co. has $2.3 million of debt, $2.5 million of preferred stock, and $1.8 million of common equity. What would be its weight on preferred stock?
Answer:
37.88 %
Explanation:
The weight on preferred stock mean, what percentage out of the Total Market Value of the Sources of Capital pooled together is taken by Preferred Stock.
Weight on preferred stock = Market Value of Preferred Stock / Total Market Value of Sources of Capital x 100
where,
Market Value of Preferred Stock = $2.5 million
and
Total Market Value of Sources of Capital :
Debt $2.3 million
Preferred Stock $2.5 million
Common Equity $1.8 million
Total $6.6 million
therefore,
Weight on preferred stock = $2.5 million / $6.6 million x 100 = 37.88 %
According to the Census Bureau, in October 2016, the average house price in the United States was $27,358. 8 years earlier, the average price was $21,808. What was the annual increase in the price of the average house sold
Answer:
Annual increase in price=3.3%
Explanation:
Using the cumulative average growth formula, we can compute the average annual increase as follows;
Average annual increase =( Recent price/Initial price)^1/(n-1)
Initial price =$27,358. 8
Recent price = $21,808
n=8
Average annual increase= (27,358. 8/21,808)^(1/(8-1))=3.3%
Annual increase in price
In determining Blue Corporation's current earnings and profits (E & P) for 2019, how should taxable income be adjusted as a result of the following transactions?
Select either "Increase", "Decrease" or "Not be affected", whichever is applicable.
a. A capital loss carryover from 2018, fully used in 2019.
b. Nondeductible meal expenses in 2019.
c. Interest on municipal bonds received in 2019.
d. Nondeductible lobbying expenses in 2019.
e. Loss on a sale between related parties in 2019.
f. Federal income tax refund received in 2019.
Answer: See explanation
Explanation:
Taxable income simply refers to the income that the government imposes a tax on. Taxable income should be adjusted on the following transactions as follows:
a. A capital loss carryover from 2018, fully used in 2019.
Based on the above transaction, taxable income should be increased.
b. Nondeductible meal expenses in 2019.
Based on the above transaction, taxable income should be decreased.
c. Interest on municipal bonds received in 2019.
Based on the above transaction, taxable income should be increased.
d. Nondeductible lobbying expenses in 2019.
Based on the above transaction, taxable income should be decreased.
e. Loss on a sale between related parties in 2019.
Based on the above transaction, taxable income should be decreased.
f. Federal income tax refund received in 2019.
Based on the above transaction, taxable income should be increased.
Jake Entertainment Corporation has three segments with revenue, operating income, and depreciation and amortization information (in millions) as follows: Segment Revenue Operating Income Depreciation and Amortization Film $5,000 $1,500 $525 Theme Park 1,000 320 112 Video Game 500 175 53 Totals $6,500 $1,995 $690 The EBITDA for the Theme Park segment is
Answer:
EBITDA = $2,685
Explanation:
EBITDA is the acronym for Earnings before interest taxes depreciation and amortization .
EBITDA is a common financial metric which is used to measure the a company's profitability unlike other profitability it is very useful to gauge how much cashflow a company's has. It is the profit earned by a firm before deducting non-cash items and other obligations. It quantifies how much cash is available to settle interest on debt obligations and taxes.
It is computed ad follows:
EBITDA = operating income + depreciation an amortization
= $1,995 + $690= $2,685
EBITDA = $2,685
Select the examples that best demonstrate likely tasks for Transportation Systems/Infrastructure Planning, Management, and Regulation workers. Check all that apply.
Tanya sells airplane tickets to customers.
Stefan repairs bus engines that aren’t working properly.
Fletcher gathers and analyzes information about traffic accidents at an intersection.
Heidi sells vehicle parts to repair shops.
Jay inspects the cargo being loaded onto a ship.
Edie explains the goals of a transportation project to members of the community.
Answer:
C,E,F
Explanation:
Edge 2021
Answer:
C, E, F
Explanation:
Its correct i did it
interest cost (the increase in pension costs due to the passage of time), the expected return on plan assets (the amount that managers anticipate they will earn on the plan's investments), and other costs were all reflected in operating income. Under the new rules (which are now in effect), service costs will be reported as an operating cost and all the other pension costs and any expected returns will be reported as non-operating items. What will be the change in operating income for GM
Answer:
The change in operating income for GM is that the operating income will increase by the amount of other pension costs less expected returns.
However, this change will not affect the net income, as all the items will still be accounted for, accordingly.
Explanation:
GM's pension service cost is the present value of the amount that the GM is required by law to set aside annually to meet its employees' pension-benefits obligations. The reason for the separation is that the service cost is a compensation cost, whereas other pension costs are financial costs and not compensation costs. By this separation, the operating income of GM will increase.
Help! I dont have much lime left ;-;
Answer:
Anthropologist - researches and analyzes historical human characteristics
Agricultural Technician - gathers and test materials from plants and animals
Archivist - organizes, maintains and protects documents and records
Statistician - analyzes and explains numerical information
Cordner Corporation has two production departments, P1 and P2, and two service departments, S1 and S2. Direct costs for each department and the proportion of service costs used by the various departments for the month of July are as follows: Proportion of Services Used by: DepartmentDirect costsS1 S2 P1 P2 S1$66,000 0.70 0.10 0.20 S2$161,000 0.20 0.30 0.50 P1$166,000 P2$233,000 Under the step method of cost allocation, the amount of S2 costs allocated to S1 would be:
Answer:
$46,200
Explanation:
Calculation to determine the amount of S2 costs allocated to S1
S2 costs allocated to S1 =$66,000*0.70/(0.70 +0.10+ 0.20)
S2 costs allocated to S1 =$46,200/1.00
S2 costs allocated to S1 =$46,200
Therefore Under the step method of cost allocation, the amount of S2 costs allocated to S1 would be:$45,200
Finishing Touches has two classes of stock authorized: 7%, $10 par preferred, and $1 par value common. The following transactions affect stockholders' equity during 2021, its first year of operations: January 2 Issues 100,000 shares of common stock for $24 per share. February 6 Issues 1,900 shares of 7% preferred stock for $13 per share. September 10 Purchases 12,000 shares of its own common stock for $29 per share. December 15 Resells 6,000 shares of treasury stock at $34 per share. In its first year of operations, Finishing Touches has net income of $149,000 and pays dividends at the end of the year of $94,000 ($1 per share) on all common shares outstanding and $1,330 on all preferred shares
Required:
Prepare the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2018. (Amounts to be deducted should be indicated by a minus sign.)
Answer:
Total Stockholders' Equity = $2,334,370
Explanation:
Note: See the attached excel file for the stockholders' equity section of the balance sheet for Finishing Touches as of December 31, 2018 with all the formulae used.
In the attached excel file, the retained earnings is calculated as follows:
Retained earnings = Net income – Common dividends - Preferred dividends = $149,000 - $94,000 - $1,330) = $53,670
From the attached excel file, we have:
Total Stockholders' Equity = $2,334,370