Answer:
$1,470,132
Explanation:
Expenditures:
March 1, $6,300,000
June 1, $5,270,000
December 31, $8,950,000
the weighted average interest rate:
$6,380,000 x 10% = $638,000
$12,550,000 x 11% = $1,380,500
total debt = $18,930,000
total interest = $2,018,500
weighted average interest rate = $2,018,500 / $18,930,000 = 10.663%
weighted average accumulated expenditures:
March 1, $6,300,000 x 10/12 = $5,250,000
June 1, $5,270,000 x 7/12 = $3,074,167
December 31, $8,950,000 x 0/12 = $0
total = $8,324,167
interests on the specific loan = $3,180,000 x 12% = $381,600
interests on remaining expenditures = ($8,324,167 - $3,180,000) x 10.663% = $548,520
total interest capitalized = $930,120
total interest expensed = total interests on other loans - interests capitalized on remaining expenditures = $2,018,500 - $548,520 = $1,469,980 ≈ $1,470,132 which we can match to the nearest option due since during the procedure we rounded a couple of times.
Geoffrey, Suzanne, Jay, and Emma are college roommates. They're trying to decide where the four of them should go for spring break: Las Vegas or Vail. If they order the tickets by 10:00 PM on February 1, the cost will be just $500 per person. If they miss that deadline, the cost rises to $1,200 per person.
The following table shows the benefit (in dollar terms) that each roommate would get from the two trips.
Roommate Benefit from Las Vegas Benefit from Vail
Geoffrey $600 $1,300
Suzanne $850 $850
Jay $900 $700
Emma $1,100 $650
The roommates tend to put off making decisions. So, when February 1 rolls around and they still haven't made a decision, they schedule a vote for 9:00 PM that night. In case of a tie, they will flip a coin between the two vacation destinations.
The roommates will get the most total benefit if they choose to go to .
Given the individual benefits each roommate receives from the two trips, which trip will each roommate vote for? Fill in the table with each roommate's preferred location, assuming that a given roommate will abstain if he or she has no preference.
Roommate Vote
Emma
Jay
Suzanne
Geoffrey
Under majority rule, the roommates will vote to go to . Therefore, majority rule leads to an economically outcome.
Suppose Emma misses the vote, leaving Geoffrey, Suzanne, and Jay to figure out where they're going to go.
Geoffrey and Jay argue for their preferred destinations, but Suzanne offers to vote with Geoffrey if Geoffrey will vote on her side in an upcoming class election. This is an example of:________.
Answer: Please refer to explanation
Explanation:
1. The roommates will get the most total benefit if they choose to go to ________.
To answer this, you add the total benefit they could all get from going to either Las Vegas or Vail.
Las Vegas
= 600 + 850+ 900 + 1,100
= $3,450
Vail
= 1,300 + 850+ 700 + 650
= $3,500
The room mates in total will get a higher benefit if they choose to go to Vail.
2. Which location will each pick based on their benefits.
Emma gets a higher benefit if they go to Las Vegas so they will pick that.
Jay gets a higher benefit if they go to Las Vegas as well so they will pick that.
Suzanne will abstain as both places give them the same benefit.
Geoffrey gets a higher benefit if they go to Vail so they will pick that.
3. Under majority rule, the roommates will vote to go to ________ .
They will vote to go to Las Vegas because Emma and Jay will vote for it, Suzanne will abstain and Geoffrey will vote for Vail meaning 2 votes out of 3 for Las Vegas.
4. Therefore, majority rule leads to an economically _______ outcome.
Inefficient outcome because in total they will get a smaller benefit going to Las Vegas as opposed to Vail.5. This is an example of:________.
Logrolling
Logrolling is a practice by which people promise to mutually support each other at different times. Simply speaking, one will support the other in exchange for the other supporting the one at some later period in time. This is the deal that Suzanne offer Geoffrey.
The following partially completed process cost summary describes the July production activities of Ashad Company. Its production output is sent to its warehouse for shipping. All direct materials are added to products when processing begins. Beginning work in process inventory is 20% complete with respect to conversion.Equivalent Units of ProductionDirect MaterialsConversion Units transferred out43,000 43,000 Units of ending work in process 4,700 2,820 Equivalent units of production47,700 45,820 Costs per EUPDirect MaterialsConversion Costs of beginning work in process$ 28,450 $3,270 Costs incurred this period 667,970 271,650 Total costs$696,420 $274,920 Units in beginning work in process (all completed during July) 4,200 Units started this period 43,500 Units completed and transferred out 43,000 Units in ending work in process 4,700Prepare its process cost summary using the weighted-average method. (Round "Cost per EUP" to 2 decimal places.)
Answer:
Materials costs =$ 14.6 Per EUP
Conversion Costs= $6 Per EUP
Explanation:
Ashad Company
Process Cost Summary
Weighted Average Method
Equivalent Units of Production
Direct Materials Conversion
Units transferred out 43,000 43,000
Units of ending work in process 4,700 2,820
Equivalent units of production 47,700 45,820
Costs per EUP
Direct Materials Conversion
Costs of beginning work in process$ 28,450 $3,270
Costs incurred this period 667,970 271,650
Total costs $696,420 $274,920
Equivalent units of production 47,700 45,820
Cost Per Equivalent Unit $696,420/ 47,700 $274,920/ 45,820
$ 14.6 Per EUP $6 Per EUP
Karla Tanner opens a web consulting business called Linkworks and recorded the following transactions in its first month of operations.
Apr. 1 Tanner invests $80,000 cash along with office equipment valued at $26,000 in the company in exchange for common stock.
Apr. 2 The company prepaid $9,000 cash for twelve months' rent for office space. The company's policy is record prepaid expenses in balance sheet accounts.
Apr. 3 The company made credit purchases for $8,000 in office equipment and $3,600 in office supplies. Payment is due within 10 days.
Apr. 6 The company completed services for a client and immediately received $4,000 cash.
Apr. 9 The company completed a $6,000 project for a client, who must pay within 30 days.
Apr. 13 The company paid $11,600 cash to settle the account payable created on April 3.
Apr. 19 The company paid $2,400 cash for the premium on a 12-month insurance policy. The company's policy is record prepaid expenses in balance sheet accounts.
Apr. 22 The company received $4,400 cash as partial payment for the work completed on April 9.
Apr. 25 The company completed work for another client for $2,890 on credit.
Apr. 28 The company paid $5,500 cash in dividends.
Apr. 29 The company purchased $600 of additional office supplies on credit.
Apr. 30 The company paid $435 cash for this month's utility bill.
Descriptions of items that require adjusting entries on April 30, 2015, follow.
a) On April 2, the company prepaid $9,000 cash for twelve months' rent for office space.
b) The balance in Prepaid insurance represents the premium paid for a 12-month insurance policy; the policy's coverage began on April 1.
c) Office supplies on hand as of April 30 total $1,200.
d) Straight-line depreciation of office equipment, based on a 5-year life and a $4,000 salvage value, is $500 per month.
e) The company has completed work for a client, but has not yet billed the $1,800 fee.
f) Wages due to employees, but not yet paid, as of April 30 total $2,600.
Use the 3-step adjusting entry process to prepare the adjusting entry necessary to correctly report the revenue earned or the expense incurred:
Step 1: Determine what the current account balance equals (See General Ledger tab)
Step 2: Determine what the current account balance should equal.
Step 3: Prepare an adjusting entry to get from Step 1 to Step 2.
Generally Accepted Accounting Principles (GAAP):
The GAAP is a blend of recommendations from government bodies and widely accepted accounting principles for reporting information. It promotes openness in the exchange of economic data and makes clear and consistent financial reporting possible across organizations.
Answer:
a) On April 2, the company prepaid $9,000 cash for twelve months' rent for office space.
Step 1:
Prepaid rent $9,000
Step 2:
Prepaid rent $9,000 - $750 = $8,250
Step 3:
Dr Rent expense 750
Cr Prepaid rent 750
b) The balance in Prepaid insurance represents the premium paid for a 12-month insurance policy; the policy's coverage began on April 1.
Step 1:
Prepaid insurance $2,400
Step 2:
Prepaid rent $2,400 - $200 = $2,200
Step 3:
Dr Insurance expense 200
Cr Prepaid expenses 200
c) Office supplies on hand as of April 30 total $1,200.
Step 1:
Office supplies $3,600 + $600 = $4,200
Step 2:
Office supplies $4,200 - $3,000 = $1,200
Step 3:
Dr Office supplies expense 3,000
Cr Office supplies 3,000
d) Straight-line depreciation of office equipment, based on a 5-year life and a $4,000 salvage value, is $500 per month.
Step 1:
Office equipment $26,000 + $8,000 = $34,000
Step 2:
Office supplies $34,000 - $500 = $33,500
Step 3:
Dr Depreciation expense 500
Cr Accumulated depreciation - equipment 500
e) The company has completed work for a client, but has not yet billed the $1,800 fee.
Step 1:
Service revenue $4,000 + $6,000 + $2,890 = $12,890
Step 2:
Service revenue $12,890 + $1,800 = $14,690
Step 3:
Dr Accrued receivable 1,800
Cr Service revenue 1,800
f) Wages due to employees, but not yet paid, as of April 30 total $2,600.
Step 1:
Wages expense $0
Step 2:
Wages expense $0 + $2,600 = $2,600
Step 3:
Dr Wages expense 2,600
Cr Wages payable 2,600
Waterway Industries has equipment with a carrying amount of $2510000. The expected future net cash flows from the equipment are $2545000, and its fair value is $2043000. The equipment is expected to be used in operations in the future. What amount (if any) should Waterway report as an impairment to its equipment
Answer:
No impairment
Explanation:
Since the future net cash flows are still recoverable and they are higher than carrying amount, none needs to be reported
The following data have been recorded for recently completed Job 323 on its job cost sheet. Direct materials cost was $2,063. A total of 33 direct labor-hours and 234 machine-hours were worked on the job. The direct labor wage rate is $18 per labor-hour. The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $24 per machine-hour. The total cost for the job on its job cost sheet would be:
Answer:
$8,723
Explanation:
Calculation for total cost for the job on its job cost sheet
Direct materials 2,063
Direct labor (33 hours × $18 per hour) 594
Manufacturing overhead (234 hours × $24 per hour) 5,616
Total manufacturing cost for job 8,273
To make merit increases consistent, administrators of merit pay programs must closely monitor the compa-ratio and the:________.a. average pay of the area where the organization is based. b. number of grades in the pay structure. c. company's stock price in the current financial year. d. number of new hires in the company. individual's performance ratings.
Answer:
idk I'm dumb but try looking it up on the internet
On January 1, a company purchased a five-year insurance policy for $2,200 with coverage starting immediately. If the purchase was recorded in the Prepaid Insurance account, and the company records adjustments only at year-end, the adjusting entry at the end of the first year is:
Answer:
Debit Insurance Expense 440
Credit Prepaid Insurace 440
Explanation:
Since on January 1, the company purchased a five year insurance policy for $2,200 that means we have to divide the insurance policy amount of $2,200 by the numbers of year which is 5 years .
Hence:
$2,200/5 years
=440
Therefore the adjusting entry at the end of the first year is:
Debit Insurance Expense 440
Credit Prepaid Insurace 440
The following list of statements about corporations are given below.
1. A corporation is an entity separate and distinct from its owners.
2. As a legal entity, a corporation has most of the rights and privileges of a person.
3. Most of the largest U.S. corporations are publicly held corporations.
4. Corporations may buy, own, and sell property; borrow money; enter into legally binding contracts; and sue and be sued.
5. The net income of a corporation is taxed as a separate entity.
6. Creditors have no legal claim on the personal assets of the owners of a corporation if the corporation does not pay its debts.
7. The transfer of stock from one owner to another does not require the approval of either the corporation or other stockholders; it is entirely at the discretion of the stockholder.
8. The board of directors of a corporation manages the corporation for the stockholders, who legally own the corporation.
9. The chief accounting officer of a corporation is the controller.
10. Corporations are subject to more state and federal regulations than partnerships or proprietorships. Andrea has studied the information above and has come with more statements about corporations.
Identify whether each statement is true or false.
1. Corporation management is both an advantage and a disadvantage of a corporation compared to a proprietorship or a partnership.
A. True B. False
2. Limited liability of stockholders, government regulations, and additional taxes are the major disadvantages of a corporation.
A. True B. False
3. When a corporation is formed, organization costs are recorded as an asset.
A. True B. False
4. Each share of common stock gives the stockholder the ownership rights to vote at stockholder meetings, share in corporate earnings, keep the same percentage ownership when new shares of stock are issued, and share in assets upon liquidation.
A. True B. False
5. The number of issued shares is always greater than or equal to the number of authorized shares.
A. True B. False
6. A journal entry is required for the authorization of capital stock.
A. True B. False
8. Publicly held corporations usually issue stock directly to investors. The trading of capital stock on a securities exchange involves the transfer of already issued shares from an existing stockholder to another investor.
A. True B. False
9. The market price of common stock is usually the same as its par value.
A. True B. False
10. Retained earnings is the total amount of cash and other assets paid in to the corporation by stockholders in exchange for capital stock.
A. True B. False
Answer:
1. Corporation management is both an advantage and a disadvantage of a corporation compared to a proprietorship or a partnership.
A. True B. False
2. Limited liability of stockholders, government regulations, and additional taxes are the major disadvantages of a corporation.
A. True B. False
3. When a corporation is formed, organization costs are recorded as an asset.
A. True B. False
4. Each share of common stock gives the stockholder the ownership rights to vote at stockholder meetings, share in corporate earnings, keep the same percentage ownership when new shares of stock are issued, and share in assets upon liquidation.
A. True B. False
5. The number of issued shares is always greater than or equal to the number of authorized shares.
A. True B. False
6. A journal entry is required for the authorization of capital stock.
A. True B. False
8. Publicly held corporations usually issue stock directly to investors. The trading of capital stock on a securities exchange involves the transfer of already issued shares from an existing stockholder to another investor.
A. True B. False
9. The market price of common stock is usually the same as its par value.
A. True B. False
10. Retained earnings is the total amount of cash and other assets paid in to the corporation by stockholders in exchange for capital stock.
A. True B. False
Explanation:
1) Corporation management means that experts can be hired as managers. On the other hand, the managers may not act in the best interest of the owners, even though, they are legally required to do so.
2) Limited liability of stockholders, government regulations, and additional taxes are the major disadvantages of a corporation. Limited liability of stockholders may be a disadvantage to non-stockholders, but it is an advantage for stockholders, who will not be required to contribute more money to offset liabilities of the corporation in the event of liquidation. Since corporations are distinct persons in law, they also need to be regulated and taxed as separate persons. So, this is not a disadvantage. It is only a consequence of being separate entity, like all individuals.
3) Organization costs include legal payments, state and federal registration, and incorporation fees, promotions, and charges associated with the underwriting of stocks and bonds. Organization costs can be classified as assets on the company's balance sheet.
4) A share in a company's stock accords some rights on the holder as itemized above.
5) The number of issued shares may be equal to or less than the authorized shares. Some companies do not issue all the shares that they are authorized to issue at the same time.
6) Authorization of capital stock does not require a journal entry. A memorandum record of the authorization is instead maintained to show the number of authorized capital shares and the par value.
7) There is no question 7.
8) Initial public offerings are made directly to investors. The stock exchange market caters for the exchange of shares among investors. The company is not involved and does not take any financial record, except the register of shareholders.
9) The market price of shares may be more or less than the par value. The market price is determined by investors, who exchange shares at arm's length in the stock exchange market. The par value is determined by those authorizing the issue of shares.
10) Retained Earnings are the income generated by the corporation which have not been distributed to shareholders in the form of dividends.
Which conditions would allow Country X to have an absolute advantage over Country Y in the
production of automobiles?
O Country X's workers eam higher wages
O Country X can manufacture cars more cheaply.
O Country Y has a protective tariff on car imports.
O Country Y subsidizes its automobile industry.
Next
Answer:
O Country Y has a protective tariff on car imports.
Explanation:
A protective tariff is "a tariff imposed to protect domestic firms from import competition "
Answer:
Country X can manufacture cars more cheaply.
Explanation:
took test
Wings Co. budgeted $572,000 manufacturing direct wages, 2,500 direct labor hours, and had the following manufacturing overhead: Overhead Cost Pool Budgeted Overhead Cost Budgeted Level for Cost Driver Overhead Cost Driver Materials handling $ 196,000 4,900 pounds Weight of materials Machine setup 19,600 560 setups Number of setups Machine repair 1,600 32,000 machine hours Machine hours Inspections 16,500 330 inspections Number of inspections Requirements for Job #971 which manufactured 4 units of product: Direct labor 20 hours Direct materials 220 pounds Machine setup 30 setups Machine hours 16,700 machine hours Inspections 15 inspections The total overhead of Job #971 under the ABC costing is:
Answer:
Total allocated overhead= $11,435
Explanation:
Giving the following information:
Materials handling $196,000 4,900 pounds
Machine setup $19,600 560 setups
Machine repair $1,600 32,000 machine hours
Inspections $16,500 330 inspections
Job 971
Direct labor 20 hours
Direct materials 220 pounds
Machine setup 30 setups
Machine hours 16,700 machine hours
Inspections 15 inspections
First, we need to calculate the estimated overhead rate for each activity:
Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Materials handling= 196,000/4,900= $40 per pound
Machine setup= 19,600/560= $35 per setup
Machine repair= 1,600/32,000= $0.05 per machine hour
Inspections= 16,500/330= $50 per inspection
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Materials handling= 40*220= 8,800
Machine setup= 35*30= 1,050
Machine repair= 0.05*16,700=835
Inspections= 50*15= 750
Total allocated overhead= $11,435
Andrea Apple opened Apple Photography on January 1 of the current year. During January, the following transactions occurred and were recorded in the company's books:
1. Andrea invested $13,500 cash in the business.
2. Andrea contributed $20,000 of photography equipment to the business.
3. The company paid $2,100 cash for an insurance policy covering the next 24 months.
4. The company received $5,700 cash for services provided during January.
5. The company purchased $6,200 of office equipment on credit.
6. The company provided $2,750 of services to customers on account.
7. The company paid cash of $1,500 for monthly rent.
8. The company paid $3,100 on the office equipment purchased in transaction #5 above.
9. Paid $275 cash for January utilities.
Based on this information, the balance in the A. Apple, Capital account reported on the Statement of Owner's Equity at the end of the month would be:
A. $31,400.
B. $39,200.
C. $31,150.
D. $40,175.
E. $30,875.
Answer: D. $40,175
Explanation:
The balance in the Capital account reported on the Statement of Owner's Equity will include the Capital contributions of Andrea Apple to the business as well as the Net income from operations also known as Retained Earnings.
The Net Income for the month will be revenue less expenses.
Revenue
$5,700 cash and $2,750 on account for services provided in January.
Revenue is therefore,
= 5,700 + 2,750
= $8,450
Expenses
Expenses include the rent paid of $1,500 and the $275 paid for January Utilities.
= 1,500 + 275
= $1,775
Net Income = Revenue - Expenses
Net Income = 8,450 - 1,775
Net Income = $6,675
The Capital that Mr. Apple brought into the business refers to anything he contributed to the business whether in cash or otherwise.
The Capital therefore is,
- The $13,500 cash and the $20,000 worth of equipment.
The Capital Mr. Apple brought into the business is therefore,
= 13,500 + 20,000
= $33,500
The balance on the capital account will therefore be,
= Capital + Net Income
= 33,500 + 6,675
= $40,175
Option D. is correct.
You work for a marketing firm that has just landed a contract with Run-of-the-Mills to help them promote three of their products: guppy gummies raskels, and cannies. All of these products have been on the market for some time, but, to entice better sales, Run-of-the-Mills wants to try a new advertisement that will market two of the products that consumers will likely consume together. As a former economics student, you know that complements are typically consumed together while substitutes can take the place of other goods. Run-of-the-Mills provides your marketing firm with the following data: When the price of guppy gummies increases by 5%, the quantity of raskels sold decreases by 4% and the quantity of cannes sold increases by 5%. Your job is to use the cross-price elasticity between guppy gummies and the other goods to determine which goods your marketing firm should advertise together Complete the first column of the following table by computing the cross-price elasticity between guppy gummies and raskels, and then between guppy gummies and cannies. In the second column, determine if guppy gummies are a complement to or a substitute for each of the goods listed. Finally, complete the final column by indicating which good you should recommend marketing with guppy gummies. Relative to Guppy Gummies Cross-Price Elasticity of Demand Complement or Substitute Recommend Marketing with Guppy Gummies Raskels Cannies
Answer:
See explanation below
Explanation:
Here, when the price of guppy gummies increases by 5%, the quantity of raskels sold decreases by 4% and the quantity of cannes sold increases by 5%.
i.e, % change in price of guppy grummies = 5%
% change in quantity of raskels = -4%
% change in quantity of cannes = 5%
i) Find the Cross price elasticity of demand between guppy grummies and raskels. Use the expression below.
% change in quantity demanded of raskels / % change in price of guppy gummies
= -4% / 5%
= -0.8
Substitute goods have a negative cross price elasticity of demand. Since, the cross price elasticity of demamd here is negative, the goods are substitute.
It is recommended not to advertise raskels with guppy grummies
ii) Find the Cross price elasticity of demand between guppy grummies and cannes. Use the expression below.
% change in quantity demanded of cannes / % change in price of guppy gummies
= 5% / 5%
= 1
Complement goods have a positive cross price elasticity of demand. Since, the cross price elasticity of demamd here is positive, the goods complement each other.
It is recommended to advertise cannes with guppy grummies.
A manufacturer produces 1,000 basketballs each day, which it sells to customers for $30 each. All costs associated with production and sales total $10,000; however, if the manufacturer were to produce one additional basketball per day, total costs would increase to $10,100. From these amounts, we can tell that:________
a. the firm has negative profit.
b. marginal cost equals $100.
c. marginal cost equals $150.
d. marginal cost equals marginal revenue.
Answer:
b. marginal cost equals $100.
Explanation:
Marginal Cost is the cost of one extra unit produced.
Marginal Cost = $10,100 - $10,000 = $100
Marginal revenue is revenue earned per extra j
Unit sold. Marginal revenue equals price. $30
Marginal cost is greater than marginal revenue
Profit = Total revenue - Total cost = (1,000 × $30) - $10,000 = $20,000
Profit is positive
I hope my answer helps you
You are going to sell your house. You are determining what the price should be. To help you, you have collected information of houses that have sold in your neighborhood during the past eighteen months. You checked houses within a four mile radius and here is the information you collected. You are going to base your determination of the price of your house based on the following information. Evaluate and discuss whether the data collected was appropriate and representative of the information that is needed to analyze the problem presented in the problem setting.
House House Age Square Feet Selling Price
1 33 1812 $190,000
2 32 1915 $205,200
3 32 1840 $194,000
4 32 1832 $192,000
5 33 1851 $202,000
6 34 2032 $208,600
7 31 1755 $188,200
8 30 1805 $205,000
9 28 1900 $215,000
10 29 1485 $192,000
11 31 1525 $195,000
12 32 1515 $192,200
13 33 1685 $201,300
14 34 1600 $205,400
15 35 1650 $218,000
ANSWER: The data collected is NOT an appropriate representation that can be used to determine how much you should sell your house.
EXPLANATION: A house is evaluated by the contents which were used to build it. For instance a house built with a bricks can not be of the same value with a wood or block house, even though they have the same pattern.
Because the data does not show the values of the contents of the house, which are: walls, pattern, designs, how many stirs, roof, and interior quality, it cannot be used to determine the price you should sell your house.
Also, looking at the data gotten, you can understand that this houses has been sold according to the contents that made up the building, because some old builder were sold more costlier than some new buildings, and some building with a much bigger square feet were sold in a lower price when compared to some buildings with a smaller square feet
Sean is a baseball player who earns $890,000 per year playing for team X. If he weren't playing baseball for team X, he would be playing baseball for team Y and earning $660,000 per year. If he weren't playing baseball at all, he would be working as an accountant earning $90,000 per year. What is his economic rent as a baseball player?
Answer: The answer is given below
Explanation:
Economic rent is a payment to a factor of production that is in excess of the costs which are needed to bring the factor into production. It is the payment in excess of the opportunity cost.
Economic rent = Present opportunity - opportunity cost.
Sean is a baseball player who earns $890,000 per year playing for team X. If he weren't playing baseball for team X, he would be playing baseball for team Y and earning $660,000 per year. His economic rent in this case will be:
Economic rent = Present opportunity - opportunity cost.
= $890,000 - $660,000
= $230,000
If he weren't playing baseball at all, he would be working as an accountant earning $90,000 per year. His economic rent in this case will be:
Economic rent = Present opportunity - opportunity cost.
= $890,000 - $90,000
= $800,000
Rank the following instruments in terms of credit risk. In your rankings, use 1 for the greatest credit risk and 4 for the smallest credit risk. Assume a 10 year Treasury trades with a YTM of 5%.a. A Ba1 corporate bond ______b. A ten-year BBB- corporate bond with a YTM of 7% ______c. A secured loan from Argosy Gaming, which is a B- rated firm ______d. A senior subordinated bond from Argosy Gaming
Answer:
a. A Ba1 corporate bond 2 (not investment grade)
b. A ten-year BBB- corporate bond with a YTM of 7% 3 (medium risk but still investment grade)
c. A secured loan from Argosy Gaming, which is a B- rated firm 4 (less risky since it is backed by a collateral)
d. A senior subordinated bond from Argosy Gaming 1 (highest risk)
Explanation:
There are two major bond rating agencies in the US: Moody's and Standard & Poor's.
Their rankings are very similar, although the letters vary a little:
AAA: safest
AA: low risk
A: low risk
BBB: medium risk
BB: a little bit more riskier
B: risky
CCC: very high risk
CC: even riskier
C: riskiest
D: junk, in default
Compton Associates is an architectural firm that has been in practice only a few years. Because it is a relatively new firm, the market for the firm's services is very competitive. To compete successfully, Compton must deliver quality services at a low cost. Compton presents the following data for 2016 and 2017.Compton Associates is an architectural firm that has been inArchitect labor-hour costs are variable costs. Architect support costs for each year depend on the Architect support capacity that Compton chooses to maintain each year (that is, the number of jobs it can do each year). Architect support costs do not vary with the actual number of jobs done that year.Required1. Is Compton Associate's strategy one of product differentiation or cost leadership? Explain briefly.2. Describe key measures you would include in Compton's balanced scorecard and your reasons for doing so.
Answer:
AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAA
Explanation:
In January 2017, Crane Company, a newly formed company, issued 9500 shares of its $8 par common stock for $13 per share. On July 1, 2017, Crane Company reacquired 950 shares of its outstanding stock for $10 per share. The acquisition of these treasury sharesa. increased total stockholders' equity.b. decreased the number of issued shares.c. decreased total stockholders' equity.d. did not change total stockholders' equity.
Answer:
The correct option is C, decreased total stockholders' equity
Explanation:
By reacquiring 950 shares out of the issued shares of 9,500 shares ,the company takes possession of the 950 shares and give cash to stockholders in return for the shares repossessed.
As a result the total stockholders' equity would reduce, this is usually accounted for by deducting the cost of such repurchase from total stockholders' equity in the equity section of the balance sheet
Mifflin Co. reported the following for the current year.
Net sales $60,000
Cost of goods sold $38.000
Beginning balance in accounts receivable $14.000
Ending balance in accounts receivable $ 6,000
Compute (a) accounts receivable turnover and (b) days’ sales uncollected. Hint: Recall that accounts receivable turnover uses average accounts receivable, and days’ sales uncollected uses the ending balance in accounts receivable.
Can an object accelerate if it's moving with constant speed? Yup! Many people find this counter-intuitive at first because they forget that changes in the direction of motion of an object—even if the object is maintaining a constant speed—still count as acceleration.Acceleration is a change in velocity, either in its magnitude—i.e., speed—or in its direction, or both. In uniform circular motion, the direction of the velocity changes constantly, so there is always an associated acceleration, even though the speed might be constant. You experience this acceleration yourself when you turn a corner in your car—if you hold the wheel steady during a turn and move at constant speed, you are in uniform circular motion. What you notice is a sideways acceleration because you and the car are changing direction. The sharper the curve and the greater your speed, the more noticeable this acceleration will become. In this section we'll examine the direction and magnitude of that acceleration.The figure below shows an object moving in a circular path at constant speed. The direction of the instantaneous velocity is shown at two points along the path. Acceleration is in the direction of the change in velocity, which points directly toward the center of rotation—the center of the circular path. This direction is shown with the vector diagram in the figure. We call the acceleration of an object moving in uniform circular motion—resulting from a net external force—the centripetal acceleration
Evans Ltd. is now considering the possibility of offering a lifetime membership option to its subscribers. Under this proposal, subscribers could receive the monthly newsletter throughout their lives by paying a flat fee of $480. The one-year subscription rate of $40 would continue to apply to new and existing subscribers who choose to subscribe on an annual basis. Assume that the average age of Evans Ltd.'s current subscribers is 38 and their average life expectancy is 78 years. Evans Ltd.'s average interest rate on long-term debt is 12%.
Using the information given, calculate the present value of a lifetime membership for an average. (Round PV factors to 4 decimal places and final answer to 2 decimal places.)
Answer: $329.75
Explanation:
The one year subscription is $40 per year. It is estimated that the average age of current subscribers is 38 and they will leave on average to 78. This means that they will leave for,
= 78 - 38
= 40 years
Evans Ltd average interest rate on long-term debt is 12% so this means that we can use that 12% as a discount rate for the cash-flow expected.
I have attached a Present Value Interest Factor of an Annuity table to this question. It helps calculate annuities faster.
The above can be treated as an annuity because the $40 is constant every year.
The present value of the $40 over 40 years can be calculated by,
= $40 * present value Interest Factor of an Annuity for 40 years at 12% (look at the table for where 40 years on the y axis intersects with 12% on the x axis)
= $40 * 8.2438 (this is the figure when it is not rounded off to 3 dp)
= $329.752
= $329.75
This shows that the lifetime flat fee of $480 is more profitable for Evans Ltd as opposed to the yearly subscription. They should therefore try to sell more of the lifetime contract with the flat fee.
Ida Sidha Karya Company is a family-owned company located in the village of Gianyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $880. Selected data for the company’s operations last year follow:Units in beginning inventory 0Units produced 280Units sold 240Units in ending inventory 40Variable costs per unit: Direct materials $ 115 Direct labor $ 335 Variable manufacturing overhead $ 35 Variable selling and administrative $ 25 Fixed costs: Fixed manufacturing overhead $ 63,000 Fixed selling and administrative $ 23,000 The absorption costing income statement prepared by the company’s accountant for last year appears below:Sales $ 211,200Cost of goods sold 170,400Gross margin 40,800Selling and administrative expense 29,000Net operating income $ 11,800Required:Determine how much of the ending inventory consists of fixed manufacturing overhead cost deferred in inventory to the next period.
Answer:
Fixed manufacturing cost allocated to inventory= $9,000
Explanation:
Giving the following information:
Units in beginning inventory 0
Units produced 280
Units sold 240
Units in ending inventory 40
Fixed manufacturing overhead $63,000
The absorption costing method includes all costs related to production, both fixed and variable.
First, we need to calculate the unitary fixed manufacturing cost:
unitary fixed manufacturing cost= 63,000/280= $225
Fixed manufacturing cost allocated to inventory= 40*225=$9,000
Walter, a single taxpayer, purchased a limited partnership interest in a tax shelter in 1993. He also acquired a rental house in 2019, which he actively manages. During 2019, Walter's share of the partnership's losses was $30,000, and his rental house generated $20,000 in losses. Walter's modified adjusted gross income before passive losses is $130,000.
A. Calculate the amount of Walter's allowable deduction for rental house activities for 2017.B. Calculate the amount of Walter's allowable deduction for the partnership losses for 2017.C. What may be done with the unused losses, if anything?
1. The unused losses may be carried.
2. tax years to reduce.
3. income in those years.
Answer:
A. $10,000
B. $0
C. The unused losses may be carried forward to future tax years to reduce passive income in those years.
Explanation:
A. Calculate the amount of Walter's allowable deduction for rental house activities for 2017.
Excess of Walter's modified adjusted gross income before passive losses over $100,000 = $130,00 - $100,000 = $30,000
Allowable deductions = $25,000 - ($30,000 * 50%) = $10,000.
It should be noted that 50 cents, used as 50% above, for each dollar the tax payers modified adjusted gross income exceeds $100,000 is deducted from$25,000 to arrive at allowable deductions. However, there will not be allowable deduction in the case that the modified adjusted gross income is greater $150,000.
B. Calculate the amount of Walter's allowable deduction for the partnership losses for 2017.
Walter is eligible for allowable deduction for the partnership losses for 2017. Therefore, Walter's allowable deduction for the partnership losses for 2017 is $0.
C. What may be done with the unused losses, if anything?
1. The unused losses may be carried forward to future
2. tax years to reduce passive
3. income in those years.
Therefore, this can be joined together as follows:
The unused losses may be carried forward to future tax years to reduce passive income in those years.
Bartel Corporation produces bar stools for restaurants.
1. For each of the following, indicate whether the cost would typically be considered direct or indirect cost for the cost object given.
A. Lubricants used on the bar stool manufacturing equipment.
B. The factory supervisor's salary for the bar stool factory.
C. The production labor wages for the bar stool assemblers.
D. Nails and screws used in the production of the bar stools.
E. Manufacturing costs for wood and steel used in the bar stools.
2. For each of the following, indicate whether the cost would typically be considered product or period cost for the cost object given.
A. Electricity costs to run the factory.
B. Accountant salaries.
C. Selling costs for the period.
D. Delivery costs to take the bicycles to stores.
E. Tires for the bicycles.
Answer: The answers are provided below
Explanation:
1. Direct cost are the major part of cost and can be traced to a cost object while indirect cost are typically small cost and difficult to trace to a specific cost object.
A. Lubricants used on the bar stool manufacturing equipment - indirect cost
B. The factory supervisor's salary for the bar stool factory - indirect cost
C. The production labor wages for the bar stool assemblers - direct cost
D. Nails and screws used in the production of the bar stools - direct cost
E. Manufacturing costs for wood and steel used in the bar stools - direct cost.
2. A manufacturer's product costs are direct labor, direct materials, and the manufacturing overhead that are used in making its products while the period costs are written as expenses in an accounting period. Period costs are associated with passage of time and examples include the general and administrative expenses, like rent, office supplies, office depreciation, and utilities
A. Electricity costs to run the factory - product cost
B. Accountant salaries - period cost
C. Selling costs for the period - period cost
D. Delivery costs to take the bicycles to stores - period cost
E. Tires for the bicycle - product cost
On February 18, 2021, Union Corporation purchased 600 IBM bonds as a long-term investment at their face value for a total of $600,000. Union will hold the bonds indefinitely, and may sell them if their price increases sufficiently. On December 31, 2021, and December 31, 2022, the market value of the bonds was $580,000 and $610,000, respectively.Required:2. & 3. Prepare the adjusting entry for December 31, 2021 and 2022. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answer:
Dr unrealized holding gains and losses—OCI $20,000
Cr investment in bonds fair value adjustment $20,000
Dr investment in bonds fair value adjustment $30,000
Cr unrealized holding gains and losses—OCI $30,000
Explanation:
On 31st December 2021 the adjustment required is the difference between the cost of bond investment of $600,000 and the market value of the bonds which was $580,000, in a nutshell a unrealized loss of $20,000 is recorded.
The excess of fair value of market value of $610,000 over the previous year market value would be debited to fair value adjustment while it is also credited to unrealized holding gains and losses-OCI
Unfortunately, Tori doesn't have enough money in her account right now. She needs to make additional contributions at the end of each of the next three years to be able to pay for the repairs. Her account currently has $5,000, which, along with her additional contributions, is expected to continue earning 9% annual interest. If she makes equal contributions each year, how large must each contribution be for Tori to have $9,000 after three years
Answer:
Annual deposit= $770.22
Explanation:
Giving the following information:
PV= 5,000
FV= 9,000
i= 0.09
n= 3
First, we need to calculate the final value of the first $5,000. We will use the following formula:
FV= PV*(1+i)^n
FV= 5,000*1.09^3
FV= 6,475.15
Now, we calculate the annual deposits for the difference:
Investment difference= 9,000 - 6,475.15= 2,524.85
FV= {A*[(1+i)^n-1]}/i
A= annual deposit
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (2,524.85*0.09) / [(1.09^3)-1]
A= $770.22
Victory Company uses weighted-average process costing to account for its production costs.
Conversion costs are added evenly throughout the process.
Direct materials are added at the beginning of the process.
During November, the company transferred 800,000 units of product to finished goods.
At the end of November, the work in process inventory consists of 187,000 units that are 60% complete with respect to conversion.
Beginning inventory had $192,465 of direct materials and $159,635 of conversion cost.
The direct material cost added in November is $1,288,035 and the conversion cost added is $3,033,065.
Beginning work in process consisted of 74,000 units that were 100% complete with respect to direct materials and 80% complete with respect to conversion.
Of the units completed, 74,000 were from beginning work in process and 726,000 units were started and completed during the period.
Required:1. Determine the equivalent units of production with respect to direct labor and direct materials.2. Compute both the direct labor cost and the direct materials cost per equivalent unit. (Round "Cost per EUP" to 2 decimal places.)3. Compute both direct labor cost and direct materials cost assigned to units completed and transferred out and ending goods in process inventory. (Round "Cost per EUP" to 2 decimal places.)
Answer:
1. Direct Materials = 987,000 units , Direct Labor = 912,200 units
2.Direct Materials = $1.50 , Direct Labor = $3.50
3.
Units Completed and Transferred Costs
Direct Materials = $ 1,200,000
Direct Labor = $ 2,800,000
Ending goods in process inventory cost
Direct Materials = $ 280,500
Direct Labor = $ 392,700
Explanation:
First step is to determine the equivalent units of production with respect to direct labor and direct materials
Direct Materials
Note : Materials are added at beginning of the process hence, they are 100 % complete for both units categories
Units Completed and Transferred (800,000 × 100%) = 800,000
Units of Ending Work In Process (187,000 × 100%) = 187,000
Equivalent units of production = 987,000
Direct Labor
Note : Conversion costs are added evenly throughout the process, hence we need to establish units to the extent of work done.
Units Completed and Transferred (800,000 × 100%) = 800,000
Units of Ending Work In Process (187,000 × 60%) = 112,200
Equivalent units of production = 912,200
The next step is to Calculate the Total Cost of Production with respect to direct labor and direct materials incurred during the period.
Direct Materials
Cost in Opening Work In Process = $192,465
Cost added during the period = $1,288,035
Total Costs = $1,480,500
Conversion
Cost in Opening Work In Process = $159,635
Cost added during the period = $3,033,065
Total Costs = $3,192,700
Then use the above data to calculate the cost per equivalent unit for direct labor and direct materials.
Cost per equivalent unit. = Total Cost / Total Equivalent units
Direct Materials = $1,480,500 / 987,000 = $1.50
Direct Labor = $3,192,700 / 912,200 = $3.50
CONCLUSION :
Units Completed and Transferred Costs
Direct Materials = (800,000 × $1.50) = $ 1,200,000
Direct Labor = (800,000 × $3.50) = $ 2,800,000
Ending goods in process inventory cost
Direct Materials = (187,000 × $1.50) = $ 280,500
Direct Labor = (112,200 × $3.50) = $ 392,700
A country produces melons and wheat. 1.) Using the 3-point curved line drawing tool, draw a representative PPC for this country. Label it 'PPC'. 2.) Using the point drawing tool, show a production point that is efficient. Label it 'A'. 3.) Using the point drawing tool, show a production point that is attainable but not efficient. Label it 'BE'. Carefully follow the instructions above, and only draw the required objects.
Answer:
1.) Using the 3-point curved line drawing tool, draw a representative PPC for this country. Label it 'PPC'.
I have attached a picture below. It shows a simple possibilities frontier for a country that can produce up to 16 units of melons and wheat.
2.) Using the point drawing tool, show a production point that is efficient. Label it 'A'
Producition points that are efficient are any points on the curve. Producing 16 melons and 0 wheat is efficient because all economic resources are being used to produce the maximum amount of a good that is possible. Producing 8 melons, and 8 units of wheat is also efficient for the same reason.
3.) Using the point drawing tool, show a production point that is attainable but not efficient.
Any point inside the curve would be inefficient because resouces would be used to produce less than the maximum amount possible. For example, if 15 units of wheat are produced, but less than one unit of melon is produced, then, there is inefficiency, because 1 unit of melon should be produced in that case.
A part of a business's message that distinguishes it from all its competitors
is referred to as what?
Answer: Brand.
Explanation:
A brand usually a logo, name, word or sentence or the comnbination is a company's valuable assets that distinguishes its their product from its competitors. Overtime, A Brand which proves credibility will promote the company's worth and value and endear potential buyers to the benefit its owners and shareholders. A brand becomes a trademark when legal protection is conferred on it.
Answer:
unique selling proposition
Explanation:
The Ramapo Company produces two products, Blinks and Dinks. They are manufactured in two departments, Fabrication and Assembly. Data for the products and departments are listed below. Product Number of units Labor hrs per unit Machine hours per unit Blinks 1,000 4 5 Dinks 2,000 2 8 All of the machine hours take place in the Fabrication department, which has an estimated overhead of $84,000. All of the labor hours take place in the Assembly department, which has an estimated total overhead of $72,000. The Ramapo Company uses a single overhead rate to apply all overhead costs based on labor hours. What is the Single Plantwide Factory Overhead Rate for Blinks? Group of answer choices $19.50 $37.45 $78.00 $56.00
Answer:
Single Overhead Absorption rate = $19.5 per hour
Explanation:
Overhead absorption rate = Estimate overhead /Estimated labor hours
Estimated overhead = $84,000 + $72,000= 156 000
Estimated labour hours= ( 1000×4) + (2000× 2)=8,000 hours
Overhead absorption rate = 156,000/8,000 hours =$19.5 per hour
Single Overhead Absorption rate = $19.5 per hour
Suppose subway ridership in New York City declined by 10 percent after a fare increase of 25 cents to $2.75. Using the midpoint method, an estimate of the price elasticity of demand for subway rides is . True or False: According to your estimate, the Transit Authority's revenue rises when the fare increases. True False
Answer: Elasticity is 1.05
False
Explanation:
The Price Elasticity of Demand which measures how demand for goods change in relation to a change in price is calculated by the following formula,
Elasticity of demand = % change in Quantity ÷ % change in Prices
The Midpoint method is a method of estimating price percentage change by dividing the change in price by the AVERAGE of the new price and the old price.
The average of the changes are,
= (2.75 + (2.75 - 0.25))/2
= (2.75 + 2.5)/2
= 2.625
The Midpoint method gives a chance in price of,
= (2.75 - 2.65 )/ 2.625
= 9.5%
The Elasticity is therefore,
= Elasticity of demand = % change in Quantity ÷ % change in Prices
= 10% / 9.5%
= 1.05
According to this, the Transit Authority's revenue will not rise when Fair increases because the Elasticity is quite close to 1. An elasticity of 1 means that when fares increase, people using trains decrease by almost the same amount so revenue remains the same.