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Acme is a manufacturer that makes seasonal products and insures its business personal property with a Business and Personal Property Coverage Form (BPP) with a Value Reporting Form. The amount of insurance is $1,000,000 with a $1,000 deductible. Reports are due monthly. Acme suffered a business personal property loss of $500,000 caused by an insured peril, and the prior monthly report made was $400,000. The actual value of business personal property at the time of this report was $400,000. What amount would Acme’s insurer pay for the described loss?
Answer:
$399,000
Explanation:
We need to understand that deductible is a portion of a loss that is covered in the policy but must be paid by the insurance purchaser, these terms stated in the insurance contract.
Here, the actual value of the business personal property at the time of this report was $400,000. (Only the actual value is covered)
Deductible is = $1,000
Acme's insurer will pay an amount of $399,000 ($400,000 - $1,000) for the described loss.
Ann lives in Princeton, New Jersey, and commutes by train each day to her job in New York City (20 round trips per month). When the price of a round trip goes up from $10 to $20, she responds by consuming exactly the same number of trips as before, while spending $200 per month less on restaurant meals. Does the fact that her quantity of train travel is completely unresponsive to the price increase imply that Ann is not a rational consumer
Answer:
Yes
Explanation:
Hull Company reported the following income statement information for the current year: Sales $ 423,000 Cost of goods sold: Beginning inventory $ 151,500 Cost of goods purchased 286,000 Cost of goods available for sale 437,500 Ending inventory 157,000 Cost of goods sold 280,500 Gross profit $ 142,500 The beginning inventory balance is correct. However, the ending inventory figure was overstated by $33,000. Given this information, the correct gross profit would be:
Answer:
$109,500
Explanation:
Calculation to determine the correct gross profit would be:
Sales $ 423,000
Less: Corrected Cost of goods sold:($313,500)
(280,500 + $33,000)
Gross Profit $109,500
Therefore the correct gross profit would be:$109,500
Use the following data to calculate the current ratio.
Skysong, Inc. Balance Sheet December 31, 2017
Cash $65500 Accounts payable $131500
Accounts receivable 93000 Salaries and wages payable 17500
Inventory 148000 Mortgage payable 173000
Prepaid insurance 87500 Total liabilities $322000
Stock Investments 194500 Land 185500
Buildings $219500 Common stock $216500
Less: Accumulated depreciation (72500) 147000 Retained earnings 483500
Trademarks 101000 Total stockholders' equity $700000
Total assets $1022000 Total liabilities and stockholders' equity $1022000
a. 2 : 1
b. 2.64 : 1
c. 2 : 1
d. 3 : 1
Answer:
b. 2.64 : 1
Explanation:
Current ratio = Current assets/Current liabilities
Current assets = Cash + Account Receivables + Inventory + Prepaid insurance
Current assets = $65500 + $93000 + $148000 + $87500
Current assets = $394,000
Current liabilities = Accounts payable + Salaries and wages payable
Current liabilities = $131500 + $17500
Current liabilities = $149,000
Hence, Current ratio = $394,000/$149,000
Current ratio = 2.644295
Current ratio = 2.64 : 1
You are interested in valuing a 2-year semi-annual corporate coupon bond using spot rates but there are no liquid strips available. However, you do find the following 4 comparable semi-annual bonds (below) maturing over the next 2 years. Using the bootstrap approach, calculate the 12-month spot rate.
Time remaining to maturity Coupon Bond price
6 months 0.000% 99.000
1 year 1.250% 98.000
18 months 1.500% 97.000
2 years 1.250% 96.000
a. 1.668%
b. 3.335%
c. 4.167%
d. 4.189%
e. 4.204%
Answer:
Following are the solution to this question:
Explanation:
Assume that [tex]r_1[/tex] will be a 12-month for the spot rate:
[tex]\to 1.25 \% \times \frac{100}{2} \times 0.99 + \frac{(1.25\% \times \frac{100}{2}+100)}{(1+\frac{r_1}{2})^2}=98\\\\\to \frac{1.25}{100} \times \frac{100}{2} \times 0.99 + \frac{(\frac{1.25}{100} \times \frac{100}{2}+100)}{(1+\frac{r_1}{2})^2}=98\\\\\to \frac{1.25}{2} \times 0.99 + \frac{(\frac{1.25}{2} +100)}{(1+\frac{r_1}{2})^2}=98\\\\\to 0.61875 + \frac{( 0.625 +100)}{(\frac{2+r_1}{2})^2}=98\\\\\to 0.61875 + \frac{( 100.625)}{(\frac{2+r_1}{2})^2}=98\\\\\to 0.61875 + \frac{402.5}{(2+r_1)^2}=98\\\\[/tex]
[tex]\to 0.61875 + \frac{402.5}{(2+r_1)^2}=98\\\\\to 0.61875 -98 = \frac{402.5}{(2+r_1)^2}\\\\\to -97.38125= \frac{402.5}{(2+r_1)^2}\\\\\to (2+r_1)^2= \frac{402.5}{ -97.38125}\\\\\to (2+r_1)^2= -4.13\\\\ \to r_1=3.304\%[/tex]
Assume that [tex]r_2[/tex] will be a 18-month for the spot rate:
[tex]\to 1.5\% \times \frac{100}{2} \times 0.99+1.5\% \times \frac{100}{2} \times \frac{1}{(1+ \frac{3.300\%}{2})^2}+\frac{(1.5\% \times \frac{100}{2}+100)}{(1+\frac{r_2}{2})^3}=97\\\\\to \frac{1.5}{100} \times \frac{100}{2} \times 0.99+\frac{1.5}{100} \times \frac{100}{2} \times \frac{1}{(1+ \frac{\frac{3.300}{100}}{2})^2}+\frac{(\frac{1.5}{100} \times \frac{100}{2}+100)}{(1+\frac{r_2}{2})^3}=97\\\\[/tex]
[tex]\to \frac{1.5}{2} \times 0.99+\frac{1.5}{2}\times \frac{1}{(1+ \frac{\frac{3.300}{100}}{2})^2}+\frac{(\frac{1.5}{2} +100)}{(1+\frac{r_2}{2})^3}=97\\\\\to 0.7425+0.75 \times \frac{1}{(1+ \frac{\frac{3.300}{100}}{2})^2}+\frac{(0.75 +100)}{(1+\frac{r_2}{2})^3}=97\\\\\to 1.4925 \times \frac{1}{(1+0.0165)^2}+\frac{(100.75 )}{(1+\frac{r_2}{2})^3}=97\\\\\to 1.4925 \times \frac{1}{(1.033)}+\frac{(100.75 )}{(1+\frac{r_2}{2})^3}=97\\\\[/tex]
[tex]\to 1.4925 \times 0.96+\frac{(100.75 )}{(1+\frac{r_2}{2})^3}=97\\\\\to 1.4328+\frac{(100.75 )}{(1+\frac{r_2}{2})^3}=97\\\\\to 1.4328-97= \frac{(100.75 )}{(1+\frac{r_2}{2})^3}\\\\\to -95.5672= \frac{(100.75 )}{(1+\frac{r_2}{2})^3}\\\\\to (1+\frac{r_2}{2})^3= -1.054\\\\\to r_2=3.577\%[/tex]
Assume that [tex]r_3[/tex] will be a 18-month for the spot rate:
[tex]\to 1.25\% \times \frac{100}{2} \times 0.99+1.25\% \times \frac{100}{2} \times \frac{1}{(1+\frac{3.300\%}{2})^2}+1.25\%\times\frac{100}{2} \times \frac{1}{(1+\frac{3.577\%}{2})^3}+(1.25\% \times \frac{\frac{100}{2}+100}{(1+\frac{r_3}{2})^4})=96\\\\[/tex]
to solve this we get [tex]r_3=3.335\%[/tex]
Jackson has the choice to invest in city of Mitchell bonds or Sundial, Incorporated corporate bonds that pay 5.8 percent interest. Jackson is a single taxpayer who earns $52,500 annually. Assume that the city of Mitchell bonds and the Sundial, Incorporated bonds have similar risk. What interest rate would the city of Mitchell have to pay in order to make Jackson indifferent between investing in the city of Mitchell and the Sundial, Incorporated bonds for 2020
Answer:
4.524%
Explanation:
Jackson's marginal tax rate = 22%
after tax return of Sundial Incorporated bonds = 5.8% x (1 - 22%) = 4.524%
since municipal bonds are not taxed by the federal government, in order to compare the yields we must calculate the after tax return of corporate bonds. On the other hand, federal bonds do not pay state and local taxes.
The corporate charter of Alpaca Co. authorized the issuance of 10 million, $1 par common shares. During 2021, its first year of operations, Alpaca had the following transactions:
January 1 sold 8 million shares at $15 per share
June 3 retired 2 million shares at $18 per share
December 28 sold 2 million shares at $20 per share
What amount should Alpaca report as additional paid-in capital—excess of par, in its December 31, 2021, balance sheet?
A. $104 million
B. $6 million
C. $52 million
D. $208 million
Answer:
Alpaca Co.
The amount that Alpaca should report as additional paid-in capital, in excess of par, in its December 31, 2021 balance sheet is:
= $116 million
Explanation:
a) Data and Calculations:
Authorized share capital = 10 million, $1 par common shares
Transactions during the year:
Date Number of shares issued Price Common Stock Additional
January 1 sold 8 million shares at $15 $8 million $112 million
June 3 retired 2 million shares at $18 (2 million) (34 million)
December 28 sold 2 million shares $20 2 million 38 million
Total $10 million $116 million
b) Additional paid-in capital represents the excess capital that is received above the par value of the shares issued. When the retired shares (treasury stock) are accounted for using the cash method, the additional capital is stated less the treasury stock's excess issue value. When the par value method is used, a treasury stock account is created separately so that the two adjustments to the treasury stock account are reflected differently.
Rinehart Corporation purchased from its stockholders 5,000 shares of its own previously issued stock for $255,000. It later resold 2,000 shares for $54 per share, then 2,000 more shares for $49 per share, and finally 1,000 shares for $43 per share.
Prepare journal entries for the purchase of the treasury stock and the three sales of treasury stock.
Answer:
Dr Treasury Stock $255,000
Cr Cash $255,000
Dr Cash $108,000
Cr Treasury Stock $98,000
Cr Additional paid-in-capital (treasury stock)$10,000
Dr Cash $98,000
Cr Additional paid-in-capital (treasury stock)$10,000
Cr Treasury Stock $88,000
Dr Cash $43,000
Cr Common Stock $43,000
Explanation:
Preparation of the journal entries for the purchase of the treasury stock and the three sales of treasury stock.
Purchase
Dr Treasury Stock $255,000
Cr Cash $255,000
(Being to record purchase from stockholders)
Sale 1
Dr Cash $108,000
(2000*54)
Cr Treasury Stock $98,000
(2000*49)
Cr Additional paid-in-capital (treasury stock)$10,000
($108,000-$98,000
(Being To record sales of shares at $54 per share.)
Sale 2
Dr Cash $98,000
Cr Additional paid-in-capital (treasury stock)$10,000
Cr Treasury Stock $88,000
($98,000-$10,000)
(Being to record sale of shares at 49 per share )
(2000*49)
Sale 3
Dr Cash $43,000
Cr Common Stock $43,000
(1,000 shares for $43 per share)
Fedoras (F)
Very Very Bad-inators (B)
Perry
6/hr
4/hr
Dr. Doofenshmirtz
2/hr
10/hr
Graph the production possibilities frontier per hour for both Perry’s and Dr. Doofenshmirtz’s. (4 points)
Perry’s PPF
Dr. Doofenshmirtz’s PPF
Based on production per hour calculated in b., determine per unit opportunity costs of producing Fedoras and Bad-inators. Show your calculations for both Perry’s and Dr. Doofenshmirtz’s.
Who has comparative advantage in F? (1 point)
Determine a price range that is suitable for trade for both Fedoras and Bad-inators. (4 points)
Price range for Fedoras: 1F = ( , )
Price range for Bad-inators: 1 B = ( , )
If the trade price is 1F = 1B do both Perry and Dr. Doofenshmirtz gain from trade? Why?
(4 points)
Determine the new consumption possibilities frontier (CPF) with trade at the trade price of 1F = 1S for both Perry’s and Dr. Doofenshmirtz’s. Show the area of gains from trade in your graphs if it exists. (6 points)
Some people know how it works but 1+1 is 5
Imagine that two goods are available to you: hamburgers (X) and hot dogs (Y). You like hamburgers and hot dogs equally well. If your fast food budget is $50 per month, the price of hamburgers is $6 per unit, and the price of hot dogs is $4 per unit, what is your optimal consumption of hot dogs
Answer:
5
Explanation:
The budget constraint = 6h + 4hd = 50
h = hamburger
hd = hot dogs
because you like both goods equally, the optimal consumption of hot dogs = 50 / 10 = 5
On January 1, 2019, a city recorded General Fund property tax revenues of $750,000 but made no provision for uncollectible receivables or tax refunds. During the year, it collected property taxes of $720,000, wrote off $4,000 as uncollectible, and made tax refunds of $3,000. At year-end, the city finance director concluded that $10,000 of the delinquent taxes would be collected in January and February of 2020, $12,000 would be collected later in 2020, and $1,000 would need to be written off as uncollectible. How much should the city report as property tax revenue in its General Fund financial statements for the year 2019
Answer:
$730,000
Explanation:
Calculation for How much should the city report as property tax revenue in its General Fund financial statements for the year 2019
Using this formula
Property tax revenue=Collected property taxes +Delinquent taxes
Let plug in the formula
Property tax revenue=$720,000+$10,000
Property tax revenue=$730,000
Therefore How much should the city report as property tax revenue in its General Fund financial statements for the year 2019 is $730,000
g Buyers would pay exactly $175 per acre for the teak today. In one year, however, that wood will be perfectly matured. Buyers will be willing to pay $220 per acre. The trees will be past their peak after that and will start to lose their value. From now until one year from now, theoakwill have the exact same value per acre as the teak. The difference is that the oak will continue to increase in value by $10 per acre per year for the next 30 years. To be clear, an acre of oak is worth $175 today, $220 in a year, $230 in two years, and so on.
Answer:
hello your question is incomplete attached below is the complete question
Answer:
a) $200
b) $285.70
Explanation:
part A
The most Maria is willing to pay per case for an acre of teak
cash flow = $220 per acre
for year 1
considering the discounting factor of 10% = 0.9091
Hence the most Maria is willing to pay per case for an acre of teak = ( 0.9091 * cash flow )
= 0.9091 * 220 = $200
Part B
Th most Maria is willing to pay per case for an acre of Oak
For year 1 :
cash flow = $220 , discounting factor = 0.9091 , present cash flows = 200
For years 2 - 31 :
cash flow = $10 , discounting factor = 8.5699
hence present cash flow = ( 10 * 8.5699 ) = $85.70
Total present cash flow = $200 + $85.7 = $285.70
_____ is a system of ethical behavior in which acceptable behavior is defined by the views and behaviors of other relevant people.
Egoism
Utilitarianism
Universalism
Relativism
What stock should I buy
Mark Brandt, an employee of Mueller Corp., earned 3 weeks of compensated vacation time during the current year, but only took 2 weeks of vacation. His employer permits that 1 week of vacation can be carried forward to the following year. Mark fully intends to remain at his current employer and plans to take his vacation during the following year. His current weekly salary is $2,000. Mueller Corp. expects to grant a general salary increase of 5% effective at the beginning of the next year. What amount should Mueller accrue during the current year relating to Mark Brandt's carried-forward vacation
Answer:
Mark Brandt of Mueller Corporation
The amount that Mueller should accrue during the current year relating to Mark Brandt's carried-forward vacation is:
= $2,100
Explanation:
a) Data and Calculations:
Current weekly salary = $2,000
Expected general salary increase = 5%
The amount that Mueller should accrue during the current year relating to Mark Brandt's carried-forward vacation is:
= $2,000 * 1.05
= $2,100
b) $2,100 is the amount that will be paid in cash for cash settlement of Mark Brandt's carried-forward vacation, assuming he does not take it the following year.
Consider a specific example of the special-interest effect. In 2012, it was estimated that the total value of all corn-production subsidies in the United States was about $3 billion. The population of the United States was approximately 300 million people that year.
A. On average, how much did corn subsidies cost per person in the United States in 2012?
B. If each person in the United States is willing to spend only $0.50 to support efforts to overturn the corn subsidy, and if antisubsidy advocates can only raise funds from 10% of the population, how much money will they be able to raise for their lobbying efforts?
C. If the recipients of corn subsidies donate just 1% of the total amount that they receive in subsidies, how much could they raise to support lobbying efforts to continue the corn subsidy?
D. By how many dollars does the amount raised by the recipients of the corn subsidy exceed the amount raised by the opponents of the corn subsidy?
Answer:
A) $10 per person
B) $15000000
C) $30000000
D) $15000000
Explanation:
A) Cost of corn subsidies per person in the United States in 2012 = 3 billion/300 million = 3000000000/300000000 = $10 per person
B) We are told that 10 percent of 300 million population are those willing to provide funding. Thus;
Number of people providing funding = 10% × 300 million = 30,000,000
Each of these 30,000,000 people are willing to only provide $0.50.
Thus;
total funding raised for their lobbying efforts = $0.50 × 30,000,000
total funding raised for their lobbying efforts = $15000000
C) We are told that the recipients of corn subsidies donated just 1% of the total amount which they received via subsidies. Thus;
Amount raise to support lobbying efforts to continue the corn subsidy =
1% × $3 billion = $30000000
D). the difference between which the amount raised by the recipients of the corn subsidy exceeds that of the amount raised by the opponents of the corn subsidy = $30000000 - $15000000 = $15000000
Seth Erkenbeck, a recent college graduate, has just completed the basic format to be used in preparing the statement of cash flows (indirect method) for ATM Software Developers. All amounts are in thousands (000s).
ATM SOFTWARE DEVELOPERS Statement of Cash Flows For the year ended December 31, 2021
Cash Flows from Operating Activities
Net income
Adjustments to reconcile net income to net cash flows from operating activities:
Net cash flows from operating activities
Cash Flows from Investing Activities
Net cash flows from investing activities
Cash Flows from Financing Activities
Net cash flows from financing activities
Net increase (decrease) in cash $1,725
Cash at the beginning of the period 8,215
Cash at the end of the period $9,940
Listed below in random order are line items to be included in the statement of cash flows.
Cash received from the sale of land $8,590
Issuance of common stock 12,925
Depreciation expense 5,435
Increase in account receivable 4,030
Decrease in account payable 1,730
Issuance of long-term notes payable 16,345
Purchase of equipment 39,715
Decrease in inventory 1,445
Decrease in prepaid rent 875
Payment of divivdends 6,310
Net income 11,800
Purchase of treasury stock 2,585
Required:
Prepare the statement of cash flows for ATM software developers using the indirect method. List cash outflows and any decrease in cash as negative amounts. Enter the answer in thousands.
Answer:
See below
Explanation:
Statement of cash flow for ATM SOFTWARE
• The figures seems to be in thousands already.
Cash flow from operating activities
Net income
$11,800
Increase in Account receivable
($4,030)
Decrease in Account payable
($1,730)
Depreciation expense
$5,435
Decrease in inventory
$1,445
Decrease in prepaid rent
$875
Net cash flow from operating activities
$13,795
Cash flow from investing activities
Sale of land
$8,590
Purchase of equipment
($39,715 )
Net cash flow from financing activities
($31,125)
Cash flow from financing activities
Issuance of stock
$12,925
Long term note payable
$16,345
Purchase of treasury stock
($2,585 )
Payments of dividends
($6,310)
Net cash flow from financing activities
$20,375
Net increase in cash
$1,725
Cash at the beginning
$8,215
Cash at the end
$9,940
these are the choices fill in the blanks.
asset backed security.
bank run
credit default swap.
capital
bond.
credit
common stock.
credit crunch
mortgage-backed securities.
debt
mutual fund.
default
option.
equity
futures contract.
foreclosure
subprime mortgage.
leverage
central bank.
liquidity
commercial bank.
liquidity risk
hedge fund.
moral hazard
investment bank.
mortgage
fannie mae/ freddie mac.
nationalization
federal deposit insurance corporation.
regulation
federal reserve system.
return
private equity fund
risk
securitization
Partners Ana, Beth, and Cathy have capital account balances of $98000 each. The income and loss ratio is 5:2:3, respectively. In the process of liquidating the partnership, noncash assets with a book value of $66700 are sold for $29800. The balance of Beth’s Capital account after the sale is $90620. $106940. $77990. $68034.
Answer:
Balance of Beth’s Capital account after the sale = $90,620
Explanation:
Loss on sale of noncash assets = Assets' book value - Sales amount = $66,700 - $29,800 = $36,900
Beth’s share of loss on sale of noncash assets = $36,900 * (2 / (5 + 2 + 3)) = $36,900 * 0.20 = $7,380
Balance of Beth’s Capital account after the sale = Balance of Beth’s Capital account before the sale - Beth’s share of loss on sale of noncash asset = $98,000 - $7,380 = $90,620
Gato Inc. had the following inventory situations to consider at January 31, its year-end. (a1) Identify which of the following items should be included in inventory.
(a) Goods held on consignment for Steele Corp. since December 12. select including or not
(b) Goods shipped on consignment to Logan Holdings Inc. on January 5. select including or not
(c) Goods shipped to a customer, FOB destination, on January 29 that are still in transit. select including or not
(d) Goods shipped to a customer, FOB shipping point, on January 29 that are still in transit. select including or not
(e) Goods purchased FOB destination from a supplier on January 25 that are still in transit. select including or not
(f) Goods purchased FOB shipping point from a supplier on January 25 that are still in transit. select including or not
(g) Office supplies on hand at January 31.
Instructions:
Identify which of the preceding items should be included in inventory. If the item should not be included in inventory, state in what account, if any, it should have been recorded.
Answer:
A) Should not be included in inventory but included in Steele Corp's inventory
B) Should be included in inventory
C) Should be included in inventory
D) Should not be included in inventory because once they are shipped, they become the buyers property.
E) Should not be included in inventory but suppliers inventory.
F) Should be included in inventory
G) Should not be included in inventory. Should be included in Office Supplies inventory rather than Merchandise Inventory
Explanation:
A) Should not be included in inventory but included in Steele Corp's inventory
B) Should be included in inventory
C) Should be included in inventory
D) Should not be included in inventory because once they are shipped, they become the buyers property.
E) Should not be included in inventory but suppliers inventory.
F) Should be included in inventory
G) Should not be included in inventory. Should be included in Office Supplies inventory rather than Merchandise Inventory
The manager at Jerome Mobility, Inc. reported the following information for 2019: Actual Results Static Budget Units sold 1,700 units 1,500 units Revenues $221,000 $195,000 Variable costs Direct materials 70,000 60,000 Direct manufacturing labor 36,500 31,500 Variable manufacturing overhead 16,000 13,500 Total variable costs 122,500 105,000 Contribution margin 98,500 90,000 Fixed costs 51,000 50,000 Operating income $47,500 $40,000 What is the static-budget variance for operating income for Jerome Mobility Inc. for 2019
Answer:
$7,500 F
Explanation:
Calculation to determine the static-budget variance for operating income for Jerome Mobility Inc. for 2019
Using this formula
2019 Static budgeted variance for operating income = Actual result - Static budget amount
Let plug in the formula
2019 Static budgeted variance for operating income= $47,500 - $40,000
2019 Static budgeted variance for operating income= $7,500 F
Therefore the static-budget variance for operating income for Jerome Mobility Inc. for 2019 will be $7,500 F
Grant Industries, a manufacturer of electronic parts, has recently received an invitation to bid on a special order for 20,500 units of one of its most popular products. Grant currently manufactures 41,000 units of this product in its Loveland, Ohio, plant. The plant is operating at 50% capacity. There will be no marketing costs on the special order. The sales manager of Grant wants to set the bid at $13 because she is sure that Grant will get the business at that price. Others on the executive committee of the firm object, saying that Grant would lose money on the special order at that price.
Units 41,000 61,500
Manufacturing costs:
Direct materials $123,000 $184,500
Direct labor 164,000 246,000
Factory overhead 328,000 430,500
Total manufacturing costs$615,000 $861,000
Unit cost $15 $14
Required:
1. What is the relevant cost per unit and the bid price?
2. What would the total opportunity cost be if by accepting the special order the company lost sales of 6,500 units to its regular customers?
Answer:
Missing word "What would the total opportunity cost be if by accepting the special order the company lost sales of 6,500 units to its regular customers? Assume the above facts plus a normal selling price of $24 per unit."
Variable factory overhead per unit = (430,500 - 328,000) / 20,500 = $5
Direct materials per unit = $123,000 / 41,000 = $3
Direct labor per unit = 164,000 / 41,000 = $4
1. Relevant cost per unit = Direct materials per unit + Direct labor per unit + Variable factory overhead
Relevant cost per unit = $5 + $4 + $3
Relevant cost per unit = $12
So, the bid price should be above $10 per unit
2. Total opportunity cost would be the total contribution margin lost for the lost sales to the regular customer
Total opportunity cost = Loss of regular sales revenue - Total relevant cost for lost sales
Total opportunity cost = (6,500*$24) - (6,500*$12)
Total opportunity cost = $156,000 - $78,000
Total opportunity cost = $78,000
1. The relevant cost per unit for Grant Industries is $7.00 ($123,000 + $164,000)/41,000 or ($184,500 + $246,000)/61,500.
2. The total opportunity cost of accepting the special order when the company lost sales of 6,500 units from its regular customers is $12,500.
What are the relevant costs and opportunity costs?The relevant costs describe the avoidable costs that could be stopped if a decision is taken.
For example, if Grant Industries decides to take the special order, the relevant decision-making cost is $7 per unit and not $14 per unit.
The opportunity costs are costs that are not incurred based on taking an alternative decision. It also describes the lost revenue when some sales are lost for the special order.
For example, the total opportunity costs incurred by Grant Industries for taking the special order instead of attending to the regular customers with 6,500 units demand is $12,500.
Data and Calculations:Special order = 20,500 units
Current production = 41,000 units
Current operational capacity = 50%
Total capacity = 82,000 (41,000/50%)
Bid price = $13 per unit
New production based on special order = 61,500 (41,000 + 20,500)
Production Data Per Unit Per Bid
Units 41,000 61,500
Manufacturing costs:
Direct materials $123,000 $184,500
Direct labor 164,000 246,000
Factory overhead 328,000 430,500
Total manufacturing costs $615,000 $861,000
Unit cost $15 $14
Question 2 Completion:Assume the above facts plus a normal selling price of $24 per unit."
The opportunity cost of lost sales:Lost sales units = 6,500
Contribution per unit = $17 ($24 - $7)
Total contribution margin = $110,500 ($6,500 x $17)
Contribution margin from special order = $123,000 ($13 - $7 x 20,500)
Thus, the opportunity cost of lost sales is $12,500 ($123,000 - $110,500).
Learn more about relevant and opportunity costs at https://brainly.com/question/14184614 and https://brainly.com/question/8846809
At December 31, 2020, the available-for-sale debt portfolio for Blossom, Inc. is as follows.
Security Cost Fair Value Unrealized Gain (Loss)
A $17,900 $15,200 $(2,700)
B 11,000 15,000 4,000
C 24,000 26,500 2,500
Total $52,900 $56,700 3,800
Previous fair value adjustment balance—Dr. 400
Fair value adjustment—Dr. $3,400
On January 20, 2021, Blossom, Inc. sold security A for $15,300. The sale proceeds are net of brokerage fees. Blossom, Inc. reports net income in 2020 of $123,000 and in 2021 of $142,000. Total holding gains (including any realized holding gain or loss) equal $41,000 in 2021.
Prepare a statement of comprehensive income for 2020, starting with net income.
Prepare a statement of comprehensive income for 2021, starting with net income.
Answer:
a. Blossom Inc
Statement of Comprehensive Income
For the Year Ended December 31, 2020
Particulars Amount
Net income $123,000
Other comprehensive income:
Add: Unrealized holding gain $3,400
Comprehensive income $126,400
b. Blossom Inc
Statement of Comprehensive Income
For the Year Ended December 31, 2021
Particulars Amount
Net income $142,000
Other comprehensive income:
Total holding gains in 2021 $41,000
Add: Reclassification adjustment- $2,700
for loss included in net income $38,300
Comprehensive income $180,300
Note:
Particulars Amount
Net amount received from the sale of Security A $17,900
Less: Cost of Security A $15,200
Loss on the sale of Security A ($2,700)
A firm is about to undertake the manufacture of a product, and it is weighing the process configuration options. There are two intermittent processes under consideration, as well as a repetitive focus. The smaller intermittent process has fixed costs of $3,000 per month and variable costs of $10 per unit. The larger intermittent process has fixed costs of $11,000 per month and variable costs of $5 per unit. A repetitive focus plant has fixed costs of $41,000 per month and variable costs of $1 per unit.
Required:
a. At what output does the large intermittent process become cheaper than the small one?
b. At what output does the repetitive process become cheaper than the larger intermittent process?
Answer:
See below
Explanation:
Using this formula
Fixed cost of process B - fixed cost of process A ÷ unit variable cost of process A - unit variable cost of process B
a. Fixed cost = $11,000
Fixed cost = $3,000
Unit variable = $10
Unit variable = $5
Hence:
= ($11,000 - $3,000) / ($10 - $5)
= $7,000 / $5
= $1,400
This means that the larger intermittent process becomes cheaper than the small one by $1,400
b. Fixed cost = $41,000
Fixed cost = $11,000
Unit variable = $5
Unit variable = $1
= ($41,000 - $11,000) / ($5 - $1)
= $30,000 / $4
= $7,500
This means that the repetitive process become cheaper than the larger intermittent process by $7,500
AYO BRAINLY
Effective presentations are tailored to their audience, have a central message, and are influenced by their setting.
T or F
pretty sure its true. but just need some confirmation of some sort
True. I would say they have a central message. Effective presentations are: Colorful and exciting Created for a specific audience Have many messages Have a central message Are influence by a setting
Which of the following best describes a economically promising opportunity that generates value for customers as well as owners?
a) a dynamic venture
b) a economic stability
c) a opportunistic schism
d) a entrepreneurial opportunity
Answer: D. An entrepreneurial opportunity
Explanation:
Entrepreneurial opportunities are the opportunities that the entrepreneur gets such that their products are sold to make a profit in the sense that the prices that the goods are sold is more than the cost that was used during the production process.
It is simply the economically promising opportunity which leads to the generation of value for customers as well as owners.
chager Company purchased a computer system on January 1, 2019, at a cash cost of $25,000. The estimated useful life is 10 years, and the estimated residual value is $3,000. The company will use the double declining-balance depreciation method. What is the accumulated depreciation balance as of December 31, 2020? $9,000. $4,000. $7,920. $8,520.
Answer:
Accumulated depreciation= $7,920
Explanation:
Giving the following information:
Buyng price= $25,000
Salvage value= $3,000
Number of years= 10
To calculate the depreciation expense, we need to use the following formula:
Annual depreciation= 2*[(book value)/estimated life (years)]
2019:
Annual depreciation= [(25,000 - 3,000) / 10]*2
Annual depreciation= $4,400
2020:
Annual depreciation= [(22,000 - 4,400) / 10]*2
Annual depreciation= $3,520
Accumulated depreciation= $7,920
On September 12, Vander Company sold merchandise in the amount of $3,950 to Jepson Company, with credit terms of 2/10, n/30. The cost of the items sold is $2,725. Vander uses the periodic inventory system and the gross method of accounting for sales. On September 14, Jepson returns some of the merchandise. The selling price of the merchandise is $340 and the cost of the merchandise returned is $240. Jepson pays the invoice on September 18, and takes the appropriate discount. The journal entry that Vander makes on September 18 is:
Answer:
Date Account Debit Credit
September 18 Cash $3,537.80
Sales discount $ 72.20
Accounts Receivable $3,610
Explanation:
Net merchandise sold = 3,950 - 340
= $3,610
Sales discount is 2% if paid in 10 days which Jepson did.
= 2% * 3,610
= $72.20
Cash = Net sales - discount
= 3,610 - 72.20
= $3,537.80
Jayden has one hour for his part of customer service training for new employees. Which is the best way to reinforce the learning? Have a quiz at the end of the session. Have a quiz at the end of the session. Use PowerPoint slides for each separate concept. Use PowerPoint slides for each separate concept. Put the sales associates on the floor for one hour. Put the sales associates on the floor for one hour. Set aside some partnered role play time with employees.
Answer:
Have a quiz at the end of the session.
Explanation:
A car repair shop has two hoists where cars can be lifted for repair work. Currently customers come in at the rate of 4 per hour and are processed at a similar rate. On average 8 cars are waiting to be processed, 4 needing routine repairs and 4 needing major repairs. People are served on a first come first serve basis. Now: The repair shop owner feels that he is losing many customers needing routine repair because of the long wait. He dedicates one hoist for routine repair and one for major repairs. A study indicates that routine repairs are processed at the rate of 3 per hour and major repairs at the rate of 1 per hour. There are now 5 people waiting on average for routine repairs and 3 waiting on average for major repairs. With the new system, what is the average waiting time over all customers
Answer:
The Cars wait an average of 1.67 hours before being served at routine repairs.
The Cars wait an average of 3 hours before being served at major repairs.
Explanation:
At the routine repair hoist, 5 people waiting on average hence the Inventory (I) = 5 cars. The cars are processed at a rate of 3 per hour, hence the Throughput (R) = 3 cars per hour.
Therefore the Flow time (T) = I/R = 5/3 = 1.67 hours.
The Cars wait an average of 1.67 hours before being served at routine repairs.
At the major repair hoist, 3 people waiting on average hence the Inventory (I) = 3 cars. The cars are processed at a rate of 1 per hour, hence the Throughput (R) = 1 cars per hour.
Therefore the Flow time (T) = I/R = 3/1 = 3 hours.
The Cars wait an average of 3 hours before being served at major repairs.
The cars will wait an average of 1.67 hours before being served at routine repairs while they'll wait an average of 3 hours before being served at major repairs.
From the information given, at the routine repair hoist, 5 people waiting on average and the cars are processed at a rate of 3 per hour, therefore the flow time (T) will be:
= I/R = 5/3 = 1.67 hours.
Also, at the major repair hoist, 3 people wait on average and the cars are processed at a rate of 1 per hour. Therefore, the Flow time (T) will be:
= I/R = 3/1 = 3 hours.
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