Answer:
The amount invested in M = $8,000
The amount invested in N = $12,000
Explanation:
Data provided in the question:
Total amount invested = $20,000
Expected return on portfolio = 14%
Expected return on M = 20% = 0.20
Expected return on N = 10% = 0.10
Now,
Let the amount invested in M be 'x'
thus,
Amount invested in N will be = $20,000 - x
Thus,
According to the question
0.20(x) + 0.10($20,000 - x) = 0.14($20,000)
or
0.20x + $2,000 - 0.10x = $2,800
or
0.10x = $800
or
x = $8,000
Therefore,
Amount invested in N will be = $20,000 - $8,000
= $12,000
Hence,
The amount invested in M = $8,000
The amount invested in N = $12,000
An investor has an opportunity to purchase an investment that will provide $11,000 at the end of three years, and $50,000 at the end of five years. If the property is expected to be sold at the end of the sixth year for $100,000 and the investor requires a 12% rate of return, what amount should he or she pay for the investment today?a. $161,000 b. $50,663 c. $81,568 d. $86,864
Answer:
Option (d) $86,864
Explanation:
Present value = Cash flow × Discounting factor
Here,
Discounting factor = ( 1 + r )⁻ⁿ
n = the year of cash flow
r = discount rate = 12%
Year (n) Cash flow Discount factor Present Value
3 $11,000 0.71178 $7,830
5 $50,000 0.567427 $28,371
6 $1,00,000 0.506631 $50,663
Therefore,
The amount he or she should pay for the investment today
= ∑(Present value)
= $7,830 + $28,371 + $50,663
= $86,864
Hence,
Option (d) $86,864
Erickson Air is a large airline company that pays a customer relations representative $8,000 per month. The representative, who processed 3,000 customer complaints in January and 2,500 complaints in February, is expected to process 40,000 customer complaints during 2018. Required Determine the total cost of processing customer complaints in January and in February. (Do not round intermediate calculations.)
The cost of processing customer complaints can vary widely depending on various factors. The total cost of processing customer complaints is $2.4 per customer complaint.
These factors include the complexity and severity of the issues raised, the efficiency of the complaint-handling system, the level of customer service required, and the resources needed for resolution.
Costs may encompass human labor, technology, training, and potential compensation or refunds. Additionally, the impact of unresolved complaints on brand reputation and customer loyalty should be considered.
Proactive measures like investing in quality products/services, effective communication, and streamlined complaint management systems can mitigate costs and foster positive customer experiences, benefiting both the company's bottom line and customer satisfaction.
Total cost of Representative for the whole year (Total processing cost) = 12000*8 = $96,000
Total number of customers complaints processed in a year = 40,000
Therefore, the cost of Processing per customer complaint = 96000 / 40000 = $2.4 per customer complaint.
Calculation of total cost of processing customer complaints:
Month Allocated Cost
January (2.4*3000) $7,200
February (2.4*2500) $6,000
Therefore, $2.4 per customer complaint.
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Final answer:
The total cost for processing customer complaints in January and February for Erickson Air is $16,000, based on a monthly salary of $8,000 for the customer relations representative.
Explanation:
To determine the total cost of processing customer complaints in January and February for Erickson Air, we first note that the cost for a customer relations representative is $8,000 per month. Since the representative processed 3,000 complaints in January and 2,500 complaints in February, we calculate the cost for these two months combined without needing to calculate the cost per complaint directly. The total cost is simply the sum of the monthly salaries for January and February.
Therefore, the total cost for processing complaints in January and February is:
$8,000 for January$8,000 for FebruaryThe combined total cost is $16,000.
Fred Company paid $48,000 for a two-year insurance policy, ($2,000 per month), on October 1 and recorded the $48,000 as a debit to Prepaid Insurance and a credit to Cash. What adjusting entry should Fred make on December 31, the end of the accounting period (no previous adjustment has been made)? Select one: a. Debit: Prepaid Insurance 6,000 Credit: Insurance Expense 6,000 b. Debit : Insurance Expense 6,000 Credit: Prepaid Insurance 6,000 c. Debit: Insurance Expense 24,000 Credit: Prepaid Insurance 24,000 d. Debit: Prepaid Insurance 42,000 Credit: Insurance Expense 42,000
Answer:
The adjusting entry Fred should make on December 31, the end of the accounting period:
b. Debit : Insurance Expense 6,000 Credit: Prepaid Insurance 6,000
Explanation:
On October 1, Fred Company paid $48,000 for a two-year insurance policy, ($2,000 per month)
From October 1 to December 31, Fred Company has used the insurance for 3 months.
Insurance Expense = $2,000 x 3 = $6,000
The adjusting entry Fred should make on December 31, the end of the accounting period:
Debit Insurance Expense $6,000
Credit Prepaid Insurance $6,000
The adjusting entry should Fred make on December 31, the end of the accounting period is: Debit Insurance Expense $6,000; Credit Prepaid Insurance $6,000.
Journal entryBased on the information given the appropriate journal entry to record the transaction is:
Fred company adjusting entry
Debit Insurance Expense $6,000
Credit Prepaid Insurance $6,000
( $2,000 x 3 = $6,000)
Inconclusion the adjusting entry should Fred make on December 31, the end of the accounting period is: Debit Insurance Expense $6,000; Credit Prepaid Insurance $6,000.
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What is a specialty good?
Answer:
The specialty goods are one of the type of consumer products an it basically categorized under the category of shopping and the convenience goods.
The specialty products are basically purchased by the consumers or users because of its unique characteristics and high efficient brands. Exotic perfumes, designer clothe and famous printing cloths are some examples of the specialty products.
The main objective of the specialty goods is that the customers group are wiling for purchasing the specific products due to its unique features or high brand and also make special efforts for purchasing the specific products and the services.
Florence is a highly paid fashion consultant who earns $100 per hour. She has 16 hours per day that she can allocate to work or leisure, and she decides to work for 12 hours. Now suppose one of Florence's clients is featured on the front page of Vague, an influential fashion magazine. As a result, Florence's consulting fee now rises to $500 per hour. Florence decides to work only 10 hours per day. Draw Florence's new time allocation budget line, with income on the vertical axis and hours of leisure on the horizontal axis, and illustrate the indifference curve at her optimal choice. Choose the correct statement.
Answer:
Please see attachment
Explanation:
Please see attachment
The budget line represents Florence's possible combinations of income and leisure given her wage rate and available hours. After her wage increase, her budget line shifts upward as she earns more for the same hours worked. Her indifference curve shows the combinations of income and leisure she is indifferent to, and her optimal choice is where it meets her new budget line.
Explanation:To answer your question, let's firstly recall what a budget line and an indifference curve represent. In this context, the budget line represents all possible combinations of income and leisure that Florence can achieve given her hourly wage and total time available. The indifference curve represents all combinations of income and leisure that provide Florence with the same level of satisfaction or utility.
Initially, Florence was earning $100 per hour and decided to work 12 hours each day. Therefore, she had 4 hours of leisure and earned $1,200 (12 hours * $100 per hour) per day. Her initial budget line would be a downward sloping line starting from the point (16, 0) representing no leisure and maximum income (i.e., working all 16 hours), to the point (0, 1,600) representing all leisure and no income. The slope of this line would be negative, representing the trade-off between leisure and income.
However, with Florence's fee increasing to $500 per hour and her deciding to work only 10 hours, her income increases to $5,000 (10 hours * $500 per hour) and her leisure time increases to 6 hours. The new budget line starts from the point (16, 0) and ends at (0, 8,000). As her income has increased, the new budget line shifts upward. On the other hand, her indifference curve, which is steeper to the left and flatter to the right, will be tangent to the new budget line at her optimal point of choice (10, 5,000).
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PA4-3 (Algo) Selecting Cost Drivers, Assigning Costs Using Activity Rates [LO 4-1, 4-3, 4-4, 4-6 ] Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 39 $ 63 Direct labor cost per unit 23 33 Sales price per unit 354 570 Expected production per month 730 units 470 units Harbour has monthly overhead of $184,260, which is divided into the following cost pools: Setup costs $ 72,540 Quality control 58,520 Maintenance 53,200 Total $ 184,260 The company has also compiled the following information about the chosen cost drivers: Home Work Total Number of setups 37 56 93 Number of inspections 300 365 665 Number of machine hours 1,600 1,200 2,800 Required: 1. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount.)
Answer:
Instructions are listed below.
Explanation:
Giving the following information:
Basic production information follows:
Harbour has a monthly overhead of $184,260
The number of machine-hours:
Home: 1,600
Work: 1,200
Total: 2,800
To calculate the allocated overhead, first, we need to calculate the overhead rate:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 184,260/ 2,800= $65.81 per machine hour
Now we can allocate the overhead using the following formula:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Work:
Allocated MOH= 65.81*1,600= $105,296
Home:
Allocated MOH= 65.81*1,200= $78,972
Final answer:
Using a traditional costing system with machine hours as the cost driver, the Home model is assigned $105,280 in overhead and the Work model is assigned $78,960 in overhead.
Explanation:
Determining Overhead Assigned Using Traditional Costing
To calculate the overhead assigned to each product line using a traditional costing system with machine hours as the cost driver, we follow these steps:
Calculate the overhead rate by dividing the total overhead by the total number of machine hours.Assign overhead to each product by multiplying the overhead rate by the number of machine hours for each product.Using the given data:
Total overhead = $184,260
Total machine hours (Home + Work) = 2,800 hours
Overhead rate = Total overhead / Total machine hours = $184,260 / 2,800 hours = $65.80 per machine hour
Now, assign the overhead to each product line:
Therefore, the Home model is assigned $105,280 in overhead, and the Work model is assigned $78,960 in overhead.
All of your teammates are dedicated to the project. They put in the time and effort to complete their individual assignments and to be adequately prepared for team meetings. However, this time and effort does not seem to translate into effectively sharing information. Which of the following actions is most likely to improve your team’s information sharing?
Answer:
Structure team discussions to focus on a smaller set of key issues.
Explanation:
The best way to get outcome from the team is to set structure team discussions so they can focus on key issues and any ambiguity or issues can be resolved with an outcome as a team.
Del Norte Brick Co. is located near the intersection of Texas, New Mexico, and Mexico. Improved access to the company’s property is via a small bridge across the Rio Grande. The cost of the bridge was $780,000. Determine the depreciation and book value for year 3 according to the MACRS (Modified Accelerated Cost Recovery System) method.
Answer:
Depreciation for year 3 = $115518
BV = $57798
Explanation:
The modified accelerated cost recovery method employees a classification-based approach to depreciating certain assets, once classified are assigned respective rates of depreciation. for example, assets classified under automobiles, trucks and machinery are treated under 5-year MACRS and will be depreciated at 20%, 32%, 19.2% and so on.
In this question the bridge across Rio Grande being built by Del Norte Brick co is treated under 3-year MACRS, for which the rates are as follows:
33.33% for the first year
44.45% 2nd year
14.81% 3rd year
7.41% 4th year
We have been asked to determine 3rd years' depreciation and book value, determined as follows:
Depreciation year 1: $780000 33.33% = $259974
Depreciation year 2: $780000 44.45% = $346710
Depreciation year 3: $780000 14.81% = $115518
So the depreciation for year 3 = $115518
The book value is calculated as follows:
Book value = cost - accumulated depreciation
BV = $780000 - $722202
BV = $57798
Final answer:
To calculate year 3 depreciation for Del Norte Brick Co.'s bridge using MACRS, take $780,000 multiplied by 2.564%, resulting in a $19,999.20 expense. Summing up the depreciation from years 1 to 3 and subtracting from the initial cost gives a book value of $720,805.80 at the end of year 3.
Explanation:
To determine the depreciation and book value for year 3 using the Modified Accelerated Cost Recovery System (MACRS) method for the bridge owned by Del Norte Brick Co., it is important first to identify the class life of the asset according to the IRS guidelines. While the exact class life for a bridge is not specified in the question, most nonresidential real property falls under the 39-year MACRS class. For the purpose of this example, assuming the bridge qualifies for this recovery period, you would then consult the MACRS depreciation tables to find the corresponding depreciation percentage for year 3.
Under the MACRS system for a 39-year property class, the year 3 depreciation percentage is typically around 2.564% of the asset's cost. Here's the calculation for the bridge's depreciation expense in year 3:
Depreciation Expense Year 3 = Initial Cost imes Depreciation RateDepreciation Expense Year 3 = $780,000 imes 2.564%Depreciation Expense Year 3 = $19,999.20To find the book value at the end of year 3, you subtract the accumulated depreciation of the first three years from the initial cost.
Assuming there was no salvage value and the same percentage rate is applied in the first two years, the accumulated depreciation would be calculated as follows:
Year 1 Depreciation: $780,000 imes 2.461% = $19,195.80Year 2 Depreciation: $780,000 imes 2.564% = $19,999.20Year 3 Depreciation: $780,000 imes 2.564% = $19,999.20Total Accumulated Depreciation: $19,195.80 + $19,999.20 + $19,999.20 = $59,194.20Then we calculate the book value at the end of year 3:
Book Value End of Year 3 = Initial Cost - Total Accumulated DepreciationBook Value End of Year 3 = $780,000 - $59,194.20Book Value End of Year 3 = $720,805.80Therefore, the depreciation expense for year 3 is $19,999.20, and the book value of the bridge at the end of year 3 is $720,805.80.
What is the effect of the new technology on the production of​ carpet? (Give the number of yards before and after the​ change.)
Complete Question:
Suppose that before the new technology is introduced, the nation produces 15 thousand looms. After the new technology is introduced, the nation produces 27 thousand looms. (Hint: 5 compute your answers using the data in the table above and not the graphs.) What is the effect of the new technology on the production of carpet? Give the number of yards before and after the change.
Yards of carpet (Millions) Carpet looms (Thousands) 0 45 12 42
4 24 36 36 27 48 15 60 0
Answer and Explanation:
The nation was able to produce around 48 million of carpets before the new technology arrived. However, after the new technology arrived, they were able to produce 54 million carpets. (36 x 1.5)
New technology can significantly boost carpet production by automating processes and increasing efficiency. This might potentially double the output, from 100 to 200 yards per day, although actual figures would vary.
Explanation:The impact of new technology on carpet production can be significant. New technology can automate many of the processes, leading to increased efficiency. For instance, if a carpet factory was producing 100 yards of carpet per day with old machinery, introduction of new technology might enable them to manufacture 200 yards a day, doubling the output. It's important to note that the actual numbers would vary depending on the specific advancements in technology and the scale of the operation.
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Jill quits her job, which paid her $40,000 per year, so that she could start her own business. In the first year, she received $100,000 in total revenue and spent $15,000 on employee wages, $10,000 on supplies, $20,000 on rent and $10,000 to the government for taxes. She also used $40,000 from her personal savings to buy equipment for her business, which was earning 5 percent interest each year. At the end of the year, the market price for the equipment was $37,000. What is Jill’s economic profit for her business this year?
Answer:
The economic profit for her business is $45.000 without considering income tax
Explanation:
Since we are only focusing in her business, the profit is exclusively related with the operations detailed in revenues (inflows) and expenses (outflows): 100.000 - 15.000 - 10.000 - 20.000- 10.000 = 45.000. This calculation does not include income tax.
The required return on the stock of Moe's Pizza is 10.6 percent and aftertax required return on the company's debt is 3.34 percent. The company's market value capital structure consists of 67 percent equity. The company is considering a new project that is less risky than current operations and it feels the risk adjustment factor is minus 1.7 percent. The tax rate is 40 percent. What is the required return for the new project?
Answer:
6.5%
Explanation:
Firstly, we need to calculate weighted average cost of capital (WACC) as below
WACC = Weight of equity x Cost of equity + Weight of debt x Cost of debt x (1 - Tax rate)
= 67% x 10.6% + (1 - 67%) x 3.34%
= 8.2%
Then, we will add the risk adjustment factor to this WACC to get the proper WACC of the new project, which is 8.2% - 1.7% = 6.5%
The required return for the new project, adjusted for risk, is calculated to be 6.52 percent.
Explanation:The required return for the new project can be calculated using the existing rates for equity and debt, adjusting for the risk factor. Since the capital structure consists of 67 percent equity, it means the remaining 33 percent must be debt.
So, the required return would be (0.67 × 10.6) + (0.33 × 3.34), which equals 8.22 percent. But the new project is considered to be less risky than the current operations, so the risk adjustment factor of -1.7 must be applied, which results in a required return of 6.52 percent.
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A bank has agreed to lend you $53,000 for a home loan. The loan will be fully amortized over 39 years at 13.50%, with .44 points. The loan payments will be monthly. The closing cost is estimated to be $3,894 and you plan to refinance the mortgage in 8 years. Calculate the book value at the end of the 8th year.
a. $57,222.99
b. $56,749.94
c. $56,613.10
d. $56,556.08
e. None of the answers are correct
Answer
The answer and procedures of the exercise are attached in the following archives.
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
Goods in process inventory account of a manufacturing company that uses an overhead rate based on the direct labor cost has a 4,400 debit balance after all posting is completed. the cost sheet of the one job still in process shows direct materialcost of 2,000 and direct labor cost of 800. Therefore the companys overhead application rate is?
Answer:
Overhead absorption rate
= Overhead absorbed/Actual labour cost x 100
= $4,400/$800 x 100
= 550% of direct labour cost
Explanation:
Since the overhead absorbed is $4,400, there is need to divide the overhead absorbed by actual direct labour cost multiplied by 100. This gives the overhead application rate.
Consumer Compensation. Suppose your college grants Coca-Cola a monopoly in selling soft drinks on campus. Your job is to compute how much each student should be paid to compensate for his or her consumer cost of the monopoly. Suppose Coca-Cola increased the price of soft drinks by $0.30 per can and each student consumed 10 soft drinks before the monopoly was granted.
a. Kate continues to buy 10 soft drinks at the higher price. What is the appropriate compensation? $ nothing (enter your response rounded to the nearest penny).
b. Elise buys only 4 soft drinks at the higher price. Her demand curve is linear. What is the appropriate compensation?
Final answer:
To compensate consumers for the consumer cost of a monopoly, we can calculate the appropriate compensation by determining the consumer surplus. For Kate, who continues to buy 10 soft drinks at the higher price, the appropriate compensation would be $3.00. For Elise, who buys only 4 soft drinks at the higher price, her consumer surplus would be $3.40.
Explanation:
In order to calculate the appropriate compensation for consumers affected by the monopoly, we need to calculate the consumer surplus, which represents the benefit that consumers would have received if the price did not increase.
a. For Kate, who continues to buy 10 soft drinks at the higher price, the appropriate compensation would be $0.30 x 10 = $3.00, as this is the additional amount she has to pay compared to the previous price.
b. For Elise, who buys only 4 soft drinks at the higher price, we need to calculate her consumer surplus. Assuming Elise's demand curve is linear, we can use the formula for the area of a triangle to calculate the surplus. The demand curve represents the willingness to pay, and the new price represents the actual payment. The consumer surplus is the difference between the maximum amount Elise is willing to pay and the actual payment. Let's assume that Elise's maximum willingness to pay for 4 soft drinks is $2.00 per can. The actual payment is $0.30 more per can, so her consumer surplus would be: (0.5 x 4 x ($2.00 - $0.30)) = $3.40.
On January 1, 2020, Indigo signed an agreement to operate as a franchisee of Hsian Copy Service, Inc. for an initial franchise fee of $80,000. Of this amount, $16,000 was paid when the agreement was signed, and the balance is payable in 4 annual payments of $16,000 each, beginning January 1, 2021. The agreement provides that the down payment is not refundable and no future services are required of the franchisor. The present value at January 1, 2020, of the 4 annual payments discounted at 12% (the implicit rate for a loan of this type) is $48,600. The agreement also provides that 8% of the revenue from the franchise must be paid to the franchisor annually. Indigo’s revenue from the franchise for 2020 was $950,000. Indigo estimates the useful life of the franchise to be 10 years. (Hint: You may want to refer to Chapter 18 to determine the proper accounting treatment for the franchise fee and payments.)
Answer:
franchise (intangible) 58,140
franchise fee 82,460
Explanation:
we need to calculate the franchise intangible and franchise fee:
16,000 down payment
48,600 PV of the franchise payment
64,600 franchise(intangible assets)
amortized over 10 years using straight-line:
amortization: 64,600 / 10 = 6,460
year-end intangible:
64,600 - 6,460 = 58,140
fee based on sales: 950,000 x 8% = 76,000
total franchise fee: 76,000 for sales + 6,460 amortization= 82,460
Final Answer:
Indigo will pay the franchisor $76,000 annually based on the 2020 revenue of $950,000.
The annual amortization expense of the initial franchise fee is $6,460.
Explanation:
To solve this scenario, we need to perform two calculations: the annual payment to the franchisor based on revenue and the amortization of the initial franchise fee over the useful life of the franchise.
### Annual Payment to the Franchisor Based on Revenue:
Indigo has to pay 8% of its annual revenue to the franchisor. With an annual revenue of $950,000, the calculation is as follows:
Annual Payment to Franchisor = Annual Revenue * Percentage Paid to Franchisor
Annual Payment to Franchisor = $950,000 * 0.08
Annual Payment to Franchisor = $76,000
So, Indigo must pay $76,000 to the franchisor based on the revenue for the year 2020.
### Amortization of Initial Franchise Fee:
The initial franchise fee of $80,000 is a prepayment for the right to operate the franchise, and as no future services are required of the franchisor, this fee is to be amortized over the useful life of the franchise, which is estimated to be 10 years.
The present value of the 4 annual payments is given as $48,600. This is the present value of the future payments based on a discount rate of 12%. The initial down payment of $16,000 is added to this present value to find the total initial franchise fee cost that should be amortized.
Total Cost of Initial Franchise Fee = Down Payment + Present Value of Future Payments
Total Cost of Initial Franchise Fee = $16,000 + $48,600
Total Cost of Initial Franchise Fee = $64,600
The amortization expense of this initial franchise fee over the useful life of the franchise (10 years) is calculated as follows:
Annual Amortization Expense = Total Cost of Initial Franchise Fee / Useful Life of Franchise
Annual Amortization Expense = $64,600 / 10
Annual Amortization Expense = $6,460
Indigo would record an amortization expense of $6,460 each year for 10 years to allocate the cost of the franchise fee over its useful life.
To summarize:
- Indigo will pay the franchisor $76,000 annually based on the 2020 revenue of $950,000.
- The annual amortization expense of the initial franchise fee is $6,460.
Assume there is a decrease in the market demand for a good sold by price-taking firms that are initially producing the profit-maximizing level of output. For the individual firm, this would result in:
Answer: Fall in revenue
Explanation:
A decrease in demand means a lower level of demand compare to the previous period. A price taking firm means that the firm cannot determine the price in the market. Profit maximising level of output means the output level that gives the highest profit.
A fall in demand without an increase in price at a profit maximising level of output will lead to a fall in revenue and profit all things being equal.
Uber and Lyft customers often complain about the practice of ""surge"" or ""prime-time"" pricing used by these companies during periods of peak demand. This is an example of a __________ pricing policy.
Answer:
The correct word for the blank space is: dynamic.
Explanation:
Dynamic pricing policies are based on certain time frames in which the demand for a service is requested. According to those time frames, the time could be cheaper or more expensive. Businesses are said to establish flexible prices under this scenario.
The strategy where Uber and Lyft adjust prices based on consumer demand is known as dynamic pricing. This is a strategy used when the demand for a product or service is greater than its supply, with the price increase intended to balance the supply and demand.
Explanation:The policy you're referring to, where Uber and Lyft increase prices during periods of peak demand, is known as dynamic pricing policy.
Dynamic pricing, also called demand pricing or time-based pricing, is a strategy where businesses set flexible prices for products or services based on current market demands.
For Uber and Lyft, this means when the demand for rides is higher than the number of available drivers, prices go up. This acts as an incentive for more drivers to work during these busy times, and balances the supply and demand of rides.
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When the "full-cost approach" to marketing cost analysis is used, allocating fixed costs on the basis of sales:A. may make low-volume customers appear more profitable than they are.
B. increases each customer's contribution margin.
C. decreases the profitability of the whole business.
D. makes large-volume customers appear more profitable that they are.
E. increases the profitability of the whole business.
Answer:A. May make low volume customers appear more profitable than they are.
Explanation:
The allocation of fixed cost based on sales volume will increase cost allocated to large volume sales unit which will invariably reduce their profit and will reduce the cost allocated to low volume sales which may increase their profit.
It does not affect the overall firm profitability not customers contribution margin.
USSOCOM is focused on organizing, training, equipping and providing highly capable __________ special operations forces to geographic combatant commanders.
USSOCOM organizes, trains, equips, and provides highly capable Special Operations Forces globally. These forces are tasked with combating threats posed by non-state or non-governmental organizations such as al-Qaeda and ISIS, which have terrorist cells distributed worldwide.
Explanation:The United States Special Operations Command (USSOCOM) is focused on organizing, training, equipping, and providing highly capable Special Operations Forces to geographic combatant commanders. These forces are not confined to any particular region, but they operate in various parts of the world, including the United States, Asia, and Europe. This is primarily to combat non-state or non-governmental organizations that pose a significant threat to global security and peace. Such organizations include al-Qaeda and ISIS, which consist of various terrorist cells located in many different countries across all continents. Their existence and operations have introduced a new type of enemy into the balance of power equation and have necessitated more vigilant and sophisticated approaches to enhancing global security.
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Suppose net exports decreases by $100 million due to a slump in foreign economies. If the value of the multiplier is 2, what happens to the domestic aggregate demand curve?
Answer:
It shifts to the left by $200 million at each price level
Explanation:
Given that,
Multiplier = 2
Net exports decrease by $100 million
Change in aggregate demand is calculated as follows:
Multiplier = Change in Aggregate Income (ΔY) ÷ Change in Exports (ΔX)
2 = ΔY ÷ (-$100)
ΔY = -$200
Therefore, the national income will fall by -$200 and hence the aggregate demand will fall by -$200 . Hence, the aggregate demand curve will shift to the left.
Final answer:
When net exports decrease by $100 million, the aggregate demand curve shifts to the left by a magnitude of 2 times the initial change in net exports.
Explanation:
When net exports decrease by $100 million, it means that there is a slump in foreign economies, causing a decrease in demand for goods and services from the domestic economy. The value of the multiplier determines the impact of this decrease on the domestic aggregate demand curve.
If the value of the multiplier is 2, the aggregate demand curve will shift to the left by a magnitude of 2 times the initial change in net exports. In this case, the aggregate demand curve will shift to the left by $200 million.
This means that the decrease in net exports will lead to a decrease in overall domestic demand, resulting in a lower level of real GDP and potentially lower employment.
Which of the following is NOT one of the major factors that is credited for contributing to the rise of advertising?
Answer:
Trick question. There are no following factors.
Explanation:
10 points eBookPrintReferences Check my work Check My Work button is now disabledItem 9Item 9 10 points A perfectly competitive firm that makes car batteries has a fixed cost of $10,000 per month. The market price at which it can sell its output is $100 per battery. The firm’s minimum AVC is $105 per battery. The firm is currently producing 500 batteries a month (the output level at which MR = MC). This firm is making a _____________ and should _______________ production.
Answer:
loss, shut down
Explanation:
This firm is making a loss and should shut down production.
Shawn puts money into an account. One year later he sees that he has 6 percent more dollars and that his money will buy 5 percent more goods. a. The nominal interest rate was 11 percent and the inflation rate was 5 percent. b. The nominal interest rate was 6 percent and the inflation rate was 5 percent. c. The nominal interest rate was 5 percent and the inflation rate was -1 percent. d. The nominal interest rate was 6 percent and the inflation rate was 1 percent.
Answer:
d. The nominal interest rate was 6 percent and the inflation rate was 1 percent.
Explanation:
Nominal interest rate = real interest rate + inflation rate
Real interest rate is nominal interest rate less inflation rate. The real interest rate represents the real purchasing power of interest paid.
If the interest rate buys 5 percent more goods ,it means that the purchasing power and the real interest rate is 5 percent.
The nominal interest rate is 6 %
Inflation rate = nominal interest rate - real interest rate
= 6% - 5% = 1%
I hope my answer helps you.
You decide to open a retirement account at your local bank that pays 8%/year/month (8% per year compounded monthly). For the next 20 years you will deposit $400 per month into the account, with all deposits and withdrawls occurring at the end of the month. On the day of the last deposit, you will retire. Your expenses during the first year of retirement will be covered by your company's retirement plan. As such, your first withdrawal from your retirement account will occur on the day exactly 12 months after the last deposit.
a) What monthly withdrawal can you make if you want the account to last 15 years?
b) What monthly withdrawal can you make if you want the account to last forever (with infinite withdrawals)?
Answer:
Explanation:
a.)
First, find the Future value of the annuity deposits. Using a financial calculator, input the following;
Number of months; N = 20*12 = 240
Monthly rate; I/Y = 8%/12 = 0.667%
PV =0
Recurring payment; PMT = -400
then compute future value; CPT FV = 235,725.317
Next find FV of at the end of first 12 months after retirement;
235,725.317(1 + 0.00667)^12 = 255,300.546
Next, use $255,300.546 as the PV of withdrawal annuity of 15 years to find annual PMT;
PV = -255,300.546
N = 15*12 = 180
I/Y = 0.667%
FV = 0
then CPT PMT = $2,440.38
b.)
Infinite withdrawals means that they are perpetual hence referred to as Perpetuity.
Since we have the amount you will have saved by the end of 20 years (240 months) as $255,300.546, use that as the Present value (PV) of your perpetuity.
PV = PMT / rate
PMT is the recurring withdrawal
$255,300.546 = PMT / 0.667%
PMT = 0.667% * $255,300.546
PMT = $1,702.85.
Therefore, you will make a monthly withdrawal of $1,702.85.
Perth Mining Company operates two mines for the purpose of extracting gold and silver. The Saddle Mine costs $12,000/day to operate, and it yields 50 oz of gold and 3000 oz of silver each of x day. The Horseshoe Mine costs $17,000/day to operate, and it yields 75 oz of gold and 1000 oz of silver each of y day. Company management has set a target of at least 650 oz of gold and 18,000 oz of silver. How many days should each mine be operated so that the target can be met at a minimum cost?
Answer:
Operate mine 1 four 4 days and mine 2 during 6 days to obtain minimum cost for the desired output of 850 gold and 18,000 silver
Explanation:
We generate the equation system on excel:
(50g + 3000s) Q_1 --> output generated on Mine 1
(75g + 1,000s) Q_2 --> output generated on Mine 2
12,000 Q1 + 17,000 Q2 = cost of the mines
we do solver to minimize the days of each mine considering a desired output of 18,000 silver and 650 gold:
and get the following:
M1 4 days output: (50g + 3000s) 4 = 200 g 12,000s
M2 6 days output: (75g + 1,000s) 6 = 450g 6,000s
Cost: 12,000 x 4 + 17,000 x 6 = 150,000
The student's question involves solving a linear programming problem to minimize the operating costs of two mines while meeting production targets for gold and silver.
Explanation:The student is asking about a mathematical optimization problem involving the operation of two mines with the goal of meeting certain production targets for gold and silver at a minimum cost. We are given the daily operation costs and yield of each mine. To find the minimum number of days to operate each mine (x for Saddle Mine and y for Horseshoe Mine), we need to establish a system of inequalities based on the gold and silver production requirements and then use linear programming to minimize the cost function, C = 12000x + 17000y. The constraints for gold and silver production are 50x + 75y ≥ 650 (for gold) and 3000x + 1000y ≥ 18000 (for silver). Solving this optimization problem will give us the values of x and y that meet the production goals at the lowest possible cost.
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In the United States the degree of individual income mobility (that is, the degree to which people move from higher to lower or lower to higher income groupings) is___________.
a. rigid in both directions.
b. flexible in both directions.
c. flexible upward but rigid downward since high income perpetuates itself from generation to generation.
d. flexible downward but rigid upward since most low-income people never rise significantly above the poverty level.
Answer:
The correct answer is letter "B": flexible in both directions.
Explanation:
The ability that an individual, family or group of people develop to improve or worsen their economic condition is called economic mobility. It is measured in income terms and particularly, in the U.S. is flexible in both directions since, according to studies, Americans have proved to be able to get better living conditions but some of them have gone from good economic situations to poverty.
You work for an organization that is seeking growth and recently has hired new district managers to assist in this growth. In talking to other regional managers, you have heard that some district managers do not have a thorough understanding of commonly used accounting tools including an income statement and balance sheet. You have a new district manager hire, John, and see the need to do some training with him so he has a solid understanding of income statements, balance sheets, and the elements that go into them, including advertising costs, Web development costs, and store opening costs.
In preparing to train your new hire, you have determined that the use of examples (a picture is worth a thousand words) can be a great approach to use. So you have decided to gather some examples from the company’s summary of significant accounting policies from its latest financial statements.
You may apply this scenario to either Option 1 or Option 2, described in Requirements below.
Your Role
You are a regional manager for Urban Outfitters or your selected organization and oversee a number of districts. You have recently brought a new district manager on board and want to ensure he has the knowledge and tools needed to effectively do his job.
Requirements
Option 1:
The organization you work for is Urban Outfitters. Use the U.S. Securities and Exchange Commissionwebsite to find the Urban Outfitter’s 2016–2017 financial statement’s summary of significant accounting policies. Look at the data for 2015, 2016, and 2017 for the following examples of essential elements you need to cover with John and ensure his understanding.
Advertising. Examine the criteria used to expense and capitalize advertising costs and where these costs appear in the financial statement.
Store opening costs. Examine how store opening and organization costs were handled and where these costs appear in the financial statement.
Website development costs. Examine the approaches taken during the application and infrastructure development stage and the planning and operating stage.
Option 2:
Use a firm or scenario of your choosing.
Before choosing a company, read the assessment thoroughly to ensure:
The company fits the assessment requirements.
You have access to the financial statement’s summary of significant accounting policies and the Note disclosures from which you are drawing your materials. Include this information in the appendix for reference.
You can distribute the data without disclosing confidential company information.
Answer:
Option 1:
Option 1 is a better approach
The organization you work for is Urban Outfitters. Use the U.S. Securities and Exchange Commissionwebsite to find the Urban Outfitter’s 2016–2017 financial statement’s summary of significant accounting policies. Look at the data for 2015, 2016, and 2017 for the following examples of essential elements you need to cover with John and ensure his understanding.
Advertising. Examine the criteria used to expense and capitalize advertising costs and where these costs appear in the financial statement.
Store opening costs. Examine how store opening and organization costs were handled and where these costs appear in the financial statement.
Website development costs. Examine the approaches taken during the application and infrastructure development stage and the planning and operating stage.
Explanation:
Option 1:
The organization you work for is Urban Outfitters. Use the U.S. Securities and Exchange Commissionwebsite to find the Urban Outfitter’s 2016–2017 financial statement’s summary of significant accounting policies. Look at the data for 2015, 2016, and 2017 for the following examples of essential elements you need to cover with John and ensure his understanding.
Firstly it is better to show the previous years financial statements because company policies do not change every year. Each company follows some particular accounting policies example it may follow different accounting periods or it may choose accrual basis of accounting. Showing other companies financial statements is of not much use as they have their own accounting policies which result in different values of profit etc.
Advertising. Examine the criteria used to expense and capitalize advertising costs and where these costs appear in the financial statement.
Advertising expenses are listed under the marketing expenses in the income statement and deducted from the gross profit.
Store opening costs. Examine how store opening and organization costs were handled and where these costs appear in the financial statement.
Store opening costs like land or building are capitalized and recorded as an asset anddepreciated or amortized over time. Other costs like running expenses are recorded in the corresponding expense ledgers .
Website development costs. Examine the approaches taken during the application and infrastructure development stage and the planning and operating stage.
Website development costs are recorded under the research and development in the income statement and deducted in the period as they incur. Like the whole years website charges are $3600 . They may be deducted like $300 every month.
On December 31, 2019, Wintergreen, Inc., issued $150,000 of 7 percent, 10-year bonds at a price of 93.25. Wintergreen received $139,875 when it issued the bonds (or $150,000 × .9325). After recording the related entry, Bonds Payable had a balance of $150,000 and Discounts on Bonds Payable had a balance of $10,125. Wintergreen uses the straight-line bond amortization method. The first semiannual interest payment was made on June 30, 2020. Complete the necessary journal entry for June 30, 2020 by selecting the account names from the drop-down menus and entering the dollar amounts in the debit or credit columns. Score answer Visit question mapQuestion 2 linked to 3 of 9 Total2 3 of 9 Prev
Answer:
June 30, 2020 Bond Interest expense Debit $5,756.25
Discount on Bonds payable Credit $506.25
Cash Credit $5,250
Explanation:
We have to calculate the interest expense. The bond interest expense = Cash payment + bond amortization discount
Given,
Bond price = $150,000
Interest = 7%
Number of period, n = 10 years × 2 (As it is a semiannual bond) = 20
Cash payment for semiannual interest = $150,000 × 0.07 × (1÷2)
Cash payment for semiannual interest = $5,250 (Credit)
Amortized bond discount (discount on bonds payable) = $10,125 ÷ 20 (as it is a semiannual payment and $10,125 is for 10 years)
Discount on bonds payable = $506.25 (Credit)
Therefore, bond interest expense = $5,250 + $506.25 = $5,756.25 (Debit)
The interest expenses are the expense acquired by an entity for obtained funds. The interest expenses can be calculated by:
[tex]\text{Bond interest expense} & = \text{Cash payment + Bond amortization discount}[/tex]
The debit amount is $ 5756.25
It can be calculated by:
Price of the bond = $150,000
Interest Rate = 7%
Period Time (n) = [tex]10 \; \text{years} \times 2 \; (\text{Semiannual bond}) & = 20[/tex]
Cash amount for half-yearly interest = [tex]\$150,000 \times 0.07 \times\dfrac{1}{2}[/tex]
Cash amount for half-yearly interest (Credit) = $5,250
Amortized bond reduction (discount on payable bonds):
= [tex]\dfrac{\$\; 10,125}{20}[/tex]
Discount on payable bonds (Credit) = $506.25
See the attached image below for the entry sheet.
Therefore, bond interest expense will be:
[tex]= \$5,250 + \$506.25 = \$5,756.25 \;\text{(Debit)}[/tex]
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Super Carpeting Inc. (SCI) just paid a dividend (D₀) of $2.40 per share, and its annual dividend is expected to grow at a constant rate (g) of 5.00% per year. If the required return (r s ) on SCI’s stock is 12.50%, then the intrinsic value of SCI’s shares is per share. Which of the following statements is true about the constant growth model? The constant growth model can be used if a stock’s expected constant growth rate is more than its required return. The constant growth model can be used if a stock’s expected constant growth rate is less than its required return. Use the constant growth model to calculate the appropriate values to complete the following statements about Super Carpeting Inc.: • If SCI’s stock is in equilibrium, the current expected dividend yield on the stock will be per share. • SCI’s expected stock price one year from today will be per share. • If SCI’s stock is in equilibrium, the current expected capital gains yield on SCI’s stock will be per share.
Answer:
Consider the following calculations.
Explanation:
1)
Intrinsic value = D1 / (Required rate - growth rate)
Intrinsic value = (2.4 * 1.05) / 0.125 - 0.05
Intrinsic value = 2.52 / 0.075
Intrinsic value = $33.60
2)
The constant growth model implies that dividends growth rate remains constant from now to infinity.
3)
Current dividend yield = (D1 / current stock price) * 100
Current dividend yield = (2.52 / 33.6) * 100
Current dividend yield = 7.50%
Stock price 1 year from today = Present value (1 + growth rate)
Stock price 1 year from today = 33.6 * (1 + 0.05)
Stock price 1 year from today = $35.28
Capital gains yield = [(Ending value - beginning value) / beginning value] * 100
Capital gains yield = [(35.28 - 33.6) / 33.6] * 100
Capital gains yield = 5.00%
1. The intrinsic value of SCI’s shares is $33.6 per share.
2. The statement that is true is: The constant growth model can be used if a stock’s expected constant growth rate is less than its required return
3a. The current expected dividend yield on the stock is 7.50%.
3b. The Stock price in 1 year is $35.28 per share.
3c. The Expected Capital Gains Yield is 5.00%.
1) Intrinsic Value is calculated using this formula
Intrinsic Value = [D0 × (1 + g)] / [r - g]
Let plug in the formula
Intrinsic Value = [$2.40 * (1 + 0.05)] / [0.125 - 0.05]
Intrinsic Value = $2.52/ 0.075
Intrinsic Value = $33.6
2) The statement that is true is:
The constant growth model can be used if a stock’s expected constant growth rate is less than its required return.
3-a) Expected Dividend Yield is calculated using this formula
Expected Dividend Yield= D1 / P0
Let plug in the formula
Expected Dividend Yield= $2.52 / $33.6
Expected Dividend Yield= 0.075 or 7.5%
3-b) Stock price in 1 year is calculated using this formula
Stock price= Price now ×(1 + g)
Let plug in the formula
Stock price= $33.6 × (1 + 0.05)
Stock price= $35.28
3-c) Expected Capital Gains Yield is calculated using this formula
Expected Capital Gains Yield= Required Return - Expected Dividend Yield
Let plug in the formula
Expected Capital Gains Yield= 12.50% - 7.5%
Expected Capital Gains Yield= 5.00%
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An attitude of constantly seeking ways to improve company operations, including customer service, product quality, product features, the production process, and employee interactions, is called: Select one: a. Continuous improvement. b. Customer orientation. c. Just-in-time. d. Theory of constraints. e. Total quality measurement.
Answer:
a. continuous improvement
Explanation:
This is the ideal explanation of continuous improvement or (KAIZEN). The ideology of continuous improvement was brought forward by the JAPANEESE philosophy of KAIZEN, which means continuous improvement which is also a momentous aspect of total quality management (TQM). According to this philosophy businesses need not only bring strategic improvements and/or changes but must build a culture of continuous improvement of each and every aspect of a business. And such a culture must come from the top of the management.
Through continuous improvement a business can make significant cost reductions. For example through training the workforce, the efficiency and quality of work can be improved, similarly, through continuous value engineering (identification of valuing adding features and/or activities and eliminating non-value adding features and activities) one can achieve significant cost advantages in the long-run.