Answer:
$8,000
Explanation:
khaki shorts khaki pants
machine minutes per unit 15 24
contribution margin per unit $16 $32
CM per machine minute $1.067 $1.33
minimum demand 3,000 3,000
machine minutes required 45,000 72,000
total machine minutes available 288,000
total machine minutes remaining 171,000
production 0 7,125
total production 3,000 10,125
total contribution margin $48,000 $324,000
if 100 more machines hours are added, then production time increases by 6,000 minutes which can be used to produce 250 more khaki pants. Contribution margin will increase by 250 x $32 = $8,000
I calculated contribution margin per minute, but you could also calculate contribution margin per hour to determine which product is more profitable. Contribution margin per hour for shorts = $64, and for pants = $80. The answer will not change.
Post the entries in the general journal below to the Accounts Receivable account in the general ledger and to the appropriate accounts in the accounts receivable ledger for Calderone Company.
Assume the following account balances at January 1, 2019
Accounts Receivable (control account) $7,880
Accounts Receivable-John Gibrone 4, 780
Accounts Receivable-Jim Garcia 2,090
Accounts Receivable-June Lin. 1,01
General Journal
Date 2019 Description Post Debit Credit
Ref
Jan 8 Cash 470
Accounts Receivable/John Gibrone 470
Received partial payment or account from John Gibrone
20 Sales Returns and Allowances 300
Sales Tax Payabl 24
Accounts Receivable/3im Garcia 324
Accept return of defective merchandis, Credit
Memorandum 121; original sale
made on Sales S1ip 11102 of
December 27, 2018 1.
Prepare a schedule of accounts recelvable for Calderone Company at January 31, 2019. 2. Should the total of your accounts receivable schedule agree with the balance of the Accounts Receivable account in the general ledger at January 31, 2019?
Answer:
1. Prepare a schedule of accounts receivable for Calderone Company at January 31, 2019.
Since there is not enough room here, I prepared an excel spreadsheet. Since we are not told the credit terms of the sales, I assumed all the sales were more not past due.
2. Should the total of your accounts receivable schedule agree with the balance of the Accounts Receivable account in the general ledger at January 31, 2019?
Of course, the balance of the accounts receivable control account should equal the total balance of the accounts receivable schedule. Even if some accounts are written off (bad debt), both the accounts receivable schedule and the general ledger accounts receivable should show that write off.
Explanation:
Cane Company manufactures two products called Alpha and Beta that sell for $185 and $120, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 112,000 units of each product. Its unit costs for each product at this level of activity are given below:
Alpha Beta
Direct materials $ 30 $ 10
Direct labor 22 29
Variable manufacturing overhead 20 13
Traceable fixed manufacturing overhead 24 26
Variable selling expenses 20 16
Common fixed expenses 23 18
Total cost per unit $ 139 $ 112
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars.
Required:
7.
Assume that Cane normally produces and sells 48,000 Betas per year. If Cane discontinues the Beta product line, how much will profits increase or decrease?
8.
Assume that Cane normally produces and sells 68,000 Betas and 88,000 Alphas per year. If Cane discontinues the Beta product line, its sales representatives could increase sales of Alpha by 12,000 units. If Cane discontinues the Beta product line, how much would profits increase or decrease?
9.
Assume that Cane expects to produce and sell 88,000 Alphas during the current year. A supplier has offered to manufacture and deliver 88,000 Alphas to Cane for a price of $112 per unit. If Cane buys 88,000 units from the supplier instead of making those units, how much will profits increase or decrease?
10.
Assume that Cane expects to produce and sell 58,000 Alphas during the current year. A supplier has offered to manufacture and deliver 58,000 Alphas to Cane for a price of $112 per unit. If Cane buys 58,000 units from the supplier instead of making those units, how much will profits increase or decrease?
13.
Assume that Cane’s customers would buy a maximum of 88,000 units of Alpha and 68,000 units of Beta. Also assume that the company’s raw material available for production is limited to 172,000 pounds. How many units of each product should Cane produce to maximize its profits?
14.
Assume that Cane’s customers would buy a maximum of 88,000 units of Alpha and 68,000 units of Beta. Also assume that the company’s raw material available for production is limited to 172,000 pounds. What is the maximum contribution margin Cane Company can earn given the limited quantity of raw materials?
15.
Assume that Cane’s customers would buy a maximum of 88,000 units of Alpha and 68,000 units of Beta. Also assume that the company’s raw material available for production is limited to 172,000 pounds. Up to how much should it be willing to pay per pound for additional raw materials? (Round your answer to 2 decimal places.)
Answer:
7. profits will decrease by:
lost profits = total revenue - total costs = $5,760,000 - $5,376,000 = $384,000unavoidable fixed costs = $18 x 48,000 units = $864,000total decrease in profits ($1,248,000)8. profits will decrease by:
lost profits from Beta product line = $8,160,000 - $7,616,000 = ($544,000)increased profits from Alpha sales = $2,220,000 - $1,668,000 = $552,000unavoidable fixed costs = (68,000 x $18) - (12,000 x $23) = (948,000)total decrease in profits ($940,000)9. profits will increase by:
avoidable costs of producing 88,000 Alphas = 88,000 x $116 = $10,208,000cost of purchasing 88,000 x $112 = ($9,856,000)total increase in profits = $10,208,000 - $9,856,000 = $352,00010. profits will increase by:
avoidable costs of producing 58,000 Alphas = 58,000 x $116 = $6,728,000cost of purchasing 58,000 x $112 = ($6,496,000)total increase in profits = $6,728,000 - $6,496,000 = $232,00013. Since the profit margin per pound of direct materials used for Alphas = $7.67 and Betas = $4, the company should produce Alphas. It should produce 28,666 Alphas and 2 Betas. Total profits = $1,318,636 + $16 = $1,318,652
14. Maximum contribution margin:
Contribution margin Alphas = 28,666 units x $92 = $2,637,272Contribution margin Betas = 2 units x $52 = $104total contribution margin = $2,637,37615. Since the profit margin per pound of materials used Betas is only $4, there is not much room for increasing the materials costs. If you want to produce Betas, you would be willing to pay less than $9 per pound of direct materials.
But since the profit margin per pound of direct materials used on Alphas is much higher ($7.67), as long as you pay less than $12.97 per pound of direct materials you can still make a profit producing Alphas. So you could pay a much higher price if you wanted to produce Alphas and still make a profit.
Explanation:
Alpha Beta
Sales price $185 $120
Direct materials ($5 per pound) $30 $10
pounds of materials used 6 2
profit margin per pound $7.67 $4
Direct labor $22 $29
Variable manufacturing overhead $20 $13
Traceable fixed man. overhead $24 $26
Variable selling expenses $20 $16
Common fixed expenses (unavoidable) $23 $18
Total cost per unit $139 $112
total production capacity 112,000 units per year
contribution margin = sales revenue - variable costs:
contribution margin Alpha = $185 - $93 = $92
contribution margin Beta = $120 - $68 = $52
Gloria Rose works at College of Austin and is paid $ 30 per hour for a 40-hour workweek and time-and-a-half for hours above 40. LOADING...(Click the icon to view payroll tax rate information.) Requirements 1. Compute Rose's gross pay for working 60 hours during the first week of February. 2. Rose is single, and her income tax withholding is 20 % of total pay. Rose's only payroll deductions are payroll taxes. Compute Rose's net (take-home) pay for the week. Assume Rose's earnings to date are less than the OASDI limit. 3. Journalize the accrual of salaries and wages expense and the payments related to the employment of Gloria Rose. Requirement 1. Compute Rose's gross pay for working 60 hours during the first week of February. Gross Pay
Answer and Explanation:
1. The gross pay is
Straight time pay
= 40 hours × $30 per hour
= $1,200
overtime pay
= 40 hours × $30 per hour × 1.5
= $1,800
So, the total gross pay is
= $1,200 + $1,800
= $3,000
2. Now the net take home pay is
Gross pay $3,000
Less: deductions
Income tax withholding (20%) -$600
Employee OASDI tax (6.2%) -$186
Employee medicare tax (1.45%) -$43.50
Net take home pay $2,170.50
3. Now the journal entries are
Wages expense $3,000
To Income tax payable $600
To Employee OASDI tax payable $186
To Employee medicare tax payable $43.50
To wages payable $2,170.50
(Being the wages expense is recorded)
We debited the expenses as it increased the expenses and credited all liabilities it increased the liabilities
Wages payable Dr $2,170.50
To cash $2,170.50
(being cash paid is recorded)
For recording this we debited the wages payable as it reduced the liabilities and credited the cash as it also reduced the current assets
Assume that the full-employment level of output is $5000 billion and the natural unemployment rate is 5%. Suppose the current unemployment rate is 8%. What would be the current level of output according to Okun's law (when the Okun's law coefficient is 2)?
Answer:
$4700 Billion
Explanation:
Solution
Given that:
Assume that full-employment level of output is =$5000 billion
Natural employment rate is =5%
Current unemployment rate = 8%
Now,
We find the current level of output according to Okun's law when the Okun's law coefficient is 2 which is given below:
2 (unemployment rate -natural unemployment) = potential GDP - actual GDP/potential GDP *100% this is known as the Okun's law
Thus
2( 8 - 5 ) = 5000 - actual GDP / 5000 * 100
or (6 * 5000 ) / 100 = 5000 - actual GDP = $4700 Billion
or
300 = 5000 - actual GDP
Hence, the actual GDP or current output = 5000 - 300 = 4700 $ billion
German brothels recently began offering a monthly subscription service for multiple purchasers. If you thought that the brothels' encouragement of prostitution was immoral to begin with, would you consider this pricing plan to be even more immoral? Suppose a particular patron at a German brothel has the following willingness-to-pay schedule for services at the brothel, per session. Session Willingness to Pay 1st $105 2nd $90 3rd $75 4th $60 5th $45 6th $30 Suppose this consumer would not demand any more sessions, even for free. Also assume that the marginal cost to the brothel, per session, is constant at $15. At a price of $82.50 per session, the number of sessions demanded by this consumer would be . At this price and quantity, consumer surplus is
Answer:
The pricing plan of the is even more immoral to buttress that the fact that brothel was encouraged, the fact that subscription packages was introduced will enhance the practice of prostitution which also has a pricing system which is aimed at I creasing the producer surplus.
Explanation:
Given the following :
Session - - - - - Willingness to Pay
1st - - - - - $105
2nd - - - - $90
3rd - - - - -$75
4th - - - - - $60
5th - - - - - $45
6th - - - - - $30
At price of $82.50 per session, the number of sessions demanded by this consumer will be 2.
Consumer surplus = ($105 - $82.50) = $22.50
Producer surplus = ($82.50 - $22.50) = $60
Celine Dion Company issued $600,000 of 10%, 20-year bonds on January 1, 2017, at 102. Interest is payable semiannually on July 1 and January 1. Dion Company uses the straight-line method of amortization for bond premium or discount.
Instructions
Prepare the journal entries to record the following.
A) The issuance of the bonds.
B) The payment of interest and the related amortization on July 1, 2017.
C) The accrual of interest and the related amortization on December 31, 2017.
Answer:
A) The issuance of the bonds.
January 1, 2017, bonds are issued
Dr Cash 612,000
Cr Bonds payable 600,000
Cr premium on bonds payable 12,000
B) The payment of interest and the related amortization on July 1, 2017.
July 1, 2017, first coupon is paid
Dr Interest expense 29,700
Dr Premium on bonds payable 300
Cr Cash 30,000
C) The accrual of interest and the related amortization on December 31, 2017.
December 31, 2017, accrued interest payable
Dr Interest expense 29,700
Cr interest payable 29,700
Explanation:
$600,000 of 10%, 20-year bonds at 102, interest is paid semiannually ($600,000 x 10% x 1/2 = $30,000)
straight line amortization method is used to amortize bond premium
bond premium = $12,000 / 40 coupons = $300 amortized with each coupon payment
Waterway Enterprises reported cost of goods sold for 2020 of $1,385,600 and retained earnings of $5,415,900 at December 31, 2020. Waterway later discovered that its ending inventories at December 31, 2019 and 2020, were overstated by $103,320 and $38,040, respectively. Determine the corrected amounts for 2020 cost of goods sold and December 31, 2020, retained earnings.
Answer:
b. Corrected 2020 cost of goods sold = $ 1,320,320.
b. Corrected retained earnings = $5,377,860.
Explanation:
a. Determine the corrected amounts for 2020 cost of goods sold
An overstatement of the beginning inventory has to be deducted from the reported cost of good sold since the amount of the overstatement was added to the cost of goods sold initially.
On the other hand, an overstatement of the ending inventory has to be added to the reported cost of good sold since the amount of the overstatement was deducted to the cost of goods sold initially.
Therefor, we have:
Corrected 2020 cost of goods sold = $1,385,600 - $103,320 + $38,040 = $ 1,320,320.
b. Determine the corrected amounts for December 31, 2020, retained earnings
In this case, the amount of overstatement of the ending inventory has to be deducted from the reported retained earning since the retained earning was initially overstated by that amount.
Therefore, we have:
Corrected retained earnings = $5,415,900 - $38,040 = $5,377,860
The following table shows a simplified consolidated balance sheet for the entire
banking system (all figures are in billions). The reserve ratio is 25 percent.
Assets Liabilities &Equity
Reserves 96 Checkable Deposits 400
Securities 104
Loans 200
a. 1. What is the amount of excess reserves in this banking system?
2. What is the maximum amount the banking system might lend?
3. Show how the balance sheet would look after this amount has been lent
(construct new balance sheet or add columns).
4. What is the size of the monetary multiplier?
b. 1. Answer the questions in part a assuming the reserve ratio is 15 percent.
2. What is the resulting difference in the amount that the banking system can
lend? How do you explain the difference?
Answer:
Kindly check explanation
Explanation:
Excess reserve = (Actual reserve - required reserve)
Required reserve = reserve ratio × Checkable deposit
Required reserve = 0.25 × $400 billion
Required reserve = $100 billion
Excess reserve = $96 - $100 = - $4billion
B) money multiplier = 1/ required reserve ratio
1/0.25 = 4
Maxumum amount that can be Lent = 4 × 4 = $16 million
If reserve ratio = 15%
Required reserve = 0.15 × $400 billion = $60 billion
Excess reserve = $96 - $60 = $36 billion
Monetary multiplier = 1/ 0.15 = 6.667
Maximum amount of loan = 6.667 × 36 = $240 billion
Mojo Mining has a bond outstanding that sells for $1,061 and matures in 25 years. The bond pays semiannual coupons and has a coupon rate of 6.1 percent. The par value is $1,000. If the company's tax rate is 39 percent, what is the aftertax cost of debt
Answer:
3.44%
Explanation:
For computing the after tax cost of debt we need to apply the RATE formula i.e shown in the attachment below:
Provided that,
Present value = $1,061
Future value or Face value = $1,000
PMT = 1,000 × 6.1% ÷ 2 = $30.5
NPER = 25 years × 2 = 50 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after applying the above formula,
1. The pretax cost of debt is 2.82% × 2 = 5.64%
2. And, the after tax cost of debt would be
= Pretax cost of debt × ( 1 - tax rate)
= 5.64% × ( 1 - 0.39)
= 3.44%
New Keynesian theorists argue that a. price and wage adjustments in response to policy changes often overcompensate and cause further price disruptions. b. unions and big business have considerable power and often choose not to change wages and prices so as to deliberately offset policy changes enacted by the government. c. the Fed and the Congress rarely do what they say they will do, so one should never listen to what they say. d. new classical rational expectations theories about how expectations are formed are completely wrong. e. prices and wages may not be free to adjust in response to policy changes.\
Answer:
The correct answer is (D)
Explanation:
New classical "rational expectations" theories about how expectations are formed, are completely wrong. That is, prices and wages may not be free to adjust in response to policy changes.
This is the basis of New Keynesian economics, which emerged from the Classical Keynesian economics.
New Keynesian theorists argue that wages and prices are sticky (hardly adjust) in the face of short term fluctuations in the economy. This means or explains that short term federal monetary policies do not have such a great influence on wage level and price level in the macroeconomy.
Consider the following data on U.S. GDP: Year Nominal GDP GDP Deflator (Billions of dollars) (Base year 2009) 2016 18,707 105.93 1996 8,073 73.18 The growth rate of nominal GDP between 1996 and 2016 was______, and the growth rate of the GDP deflator between 1996 and 2016 was:_______.
Answer:
Data on U.S. GDP
a) The growth rate of nominal GDP between 1996 and 2016 was 131.72%, calculated as follows:
= (2016 nominal GDP - 2009 nominal GDP) / 2009 nominal GDP x 100
= (18,707 - 8,073)/ 8,073 x 100
= 131.72%
b) The growth rate of the GDP deflator between 1996 and 2016 was 44.75%, calculated as follows:
= (2016 GDP deflator - 1996 GDP deflator)/ 1996 GDP deflator x 100
= (105.93 - 73.18)/73.18 x 100
= 44.75%
Explanation:
1. Data on U.S. GDP
Year Nominal GDP GDP Deflator (Billions of dollars) (Base year 2009)
2016 18,707 105.93
1996 8,073 73.18
2. According to wikipedia.com, "the GDP deflator (implicit price deflator) is a measure of the level of prices of all new, domestically produced, final goods and services in an economy in a year."
3. Nominal GDP is a way of assessing an economy's economic production. It includes the current prices of goods and services. The GDP measures the monetary value of goods and services produced in an economy within a given period.
4. Growth rate refers to the percentage change of a specific variable within a specific time period. It is calculated as the difference between the current year's variable and the base year's variable, divided by the base year's variable, and then multiplied by 100.
Esquire Comic Book Company had income before tax of $1,550,000 in 2021 before considering the following material items: 1. Esquire sold one of its operating divisions, which qualified as a separate component according to generally accepted accounting principles. The before-tax loss on disposal was $395,000. The division generated before-tax income from operations from the beginning of the year through disposal of $610,000. 2. The company incurred restructuring costs of $60,000 during the year. Required: Prepare a 2021 income statement for Esquire beginning with income from continuing operations. Assume an income tax rate of 25%. Ignore EPS disclosures.
Answer:
Esquire Comic Book Company
Income Statement
For the Year Ended December 31, 2021
Operating income $1,550,000
Restructuring costs ($60,000)
Income from continuing operations b/ Taxes $1,490,000
Income tax expense ($372,500)
Income from continuing operations $1,117,500
Discontinued operations:
Operating income $610,000Loss on disposal ($395,000)Income tax on discontinued operations ($53,750)Income from discontinued operations $161,250
Net income $1,278,750
Explanation:
Income from discontinued operations must be reported separately, but any restructuring costs must be included as operational expenses.
nted below is information related to Viel Company at December 31, 2020, the end of its first year of operations. Sales revenue $310,000 Cost of goods sold 140,000 Selling and administrative expenses 50,000 Gain on sale of plant assets 30,000 Unrealized gain on available-for-sale debt investments 10,000 Interest expense 6,000 Loss on discontinued operations 12,000 Dividends declared and paid 5,000 Instructions Compute the following: (a) income from operations, (b) net income, (c) comprehensive income, and (d) retained earnings balance at December 31, 2020. (Ignore income tax effects.)
Answer:
Viel Company
(a) Income from operations:
Sales revenue $310,000
Cost of goods sold 140,000
Selling & admin. expenses 50,000
Income from operations $120,000
(b) Net income:
Sales revenue $310,000
Cost of goods sold -140,000
Selling & admin. expenses -50,000
Income from operations $120,000
Gain on sales of plant assets 30,000
Interest Expense -6,000
Loss on discontinued operations -12,000
Net Income $132,000
(c) Comprehensive Income
Sales revenue $310,000
Cost of goods sold -140,000
Selling & admin. expenses -50,000
Income from operations $120,000
Gain on sales of plant assets 30,000
Interest Expense -6,000
Loss on discontinued operations -12,000
Net Income $132,000
Unrealized Gain on Investments -10,000
Comprehensive Income $122,000
(d) Retained Earnings balance at December 31, 2020:
Comprehensive Income $122,000
less Dividends 5,000
Retained Earnings Balance $117,000
Explanation:
a) Income from operations is the income generated from running the primary business and excludes income from other sources. For example, gains or losses from asset disposal and discontinued operations, and interest expense.
b) Net Income is the income from operations, including other sources of income, after adding or deducting non-operating gains or losses and interests.
c) Comprehensive income equals net income and unrealized income, such as unrealized gains or losses, and other non-operating gains and losses.
An investor enters into a 2-year swap agreement to purchase crude oil at $51.25 per barrel. Soon after the swap is created, forward prices rise and the new 2-year swap price is $61.50. If interest rates are 1% and 2% on 1- and 2-year zero coupon government bonds, respectively, what is the gain or loss to be made from unwrapping the original swap agreement?
Answer:
The present Value of Annual Gain for two years made from unwrapping the original swap agreement is $20.00
Explanation:
From the given information;
The annual gain from swap agreements = $61.50 - $51.25
The annual gain from swap agreements = $10.25
Annual rate for the first year = 1% = 0.01
Annual rate for the second year = 2% = 0.02
However the present gain for the first year will be;
[tex]= \dfrac{Annual \ Gain}{(1+r_1)^1}[/tex]
[tex]= \dfrac{10.25}{(1+0.01)^1}[/tex]
= 10.14851485
The present gain for the second year will be;
[tex]= \dfrac{Annual \ Gain}{(1+r_2)^2}[/tex]
[tex]= \dfrac{10.25}{(1+0.02)^2}[/tex]
= 9.851980008
The present Value of Annual Gain for two years is:
[tex]= \dfrac{Annual \ Gain}{(1+r_1)^1} + \dfrac{Annual \ Gain}{(1+r_2)^2}[/tex]
= 10.14851485 + 9.851980008
= 20.00049486
≅ $ 20.00
The present Value of Annual Gain for two years is $20.00
Harry owns a Cadillac and a Porsche. Ryan has always wanted a Porsche and knows Harry owns one. Harry decides to sell his Cadillac and buy a BMW. A mutual friend of Ryan and Harry tells Ryan, "Harry's selling his car." Thinking Harry is selling the Porsche (he does not know he also has a Cadillac), Ryan calls Harry and says, "I'll give you $9,500 for your car." Harry, thinking Ryan is talking about the Cadillac, says, "You've got a deal." On what grounds is the above agreement open for rescission
Answer:
mutual mistake
Explanation:
A mutual mistake happens when all the parties involved in a contract (two or more) are mistaken or do not know the correct information about some specific material fact that is relevant to the contract. In this case, the contract can be rescinded because Harry believes that Ryan wants to buy his Cadillac, while Ryan believes Harry is selling his Porsche.
Since both of them are mistaken and do not know relevant material facts regarding the contract, the contract can be terminated.
1. Identify each account as asset (A), liability (L), or equity (E).2. Identify whether the account is increased with a debit (DR) or credit (CR).3. Identify whether the normal balance is a debit (DR) or credit (CR).a. Interest Revenueb. Accounts Payablec. Common Stockd. Office Suppliese. Advertising Expensef. Unearned Revenueg. Prepaid Renth. Utilities Expensei. Dividendsj. Service Revenue Requirements
Answer: Please refer to Explanation
Explanation:
.a. Interest Revenue. This is EQUITY. It increase with a CREDIT. Normal Balance is CREDIT.
Interests Revenue is earned like revenue and as such is credited. In the balance sheet it will be with Equity as it increases the Retained Earnings of a firm.
b. Accounts Payable. LIABILITY.
Increases by CREDIT.
Normal Balance is CREDIT.
Accounts Payable are the result of buying goods on account meaning the firm owes the entities in question. It is credited to show an increase.
c. Common Stock. EQUITY.
Increases by CREDIT.
Normal Balance is CREDIT.
As a Capital balance, common stock is credited to show and increase and debited to show a decrease because it signifies that the business owes the holders/owners.
d. Office Supplies. ASSET
Increase by DEBIT.
Normal Balance is CREDIT.
As an asset, Office Supplies is recorded in the debit section and is debited to show increase.
e. Advertising Expense. EQUITY.
Increases by DEBIT.
Normal Balance is DEBIT.
Increases by DEBIT.
Advertising as an expense is taken from the Revenue. This makes it am Equity item. When it is debited, it increases and this normal Balance reflects a debit balance.
f. Unearned Revenue. LIABILITY.
INcrease is CREDITED
Normal Balance is CREDIT.
Unearned Revenue is a liability because the company owes performance to an entity for work that they have already been paid for. As such it's balance is increased by a Credit.
g. Prepaid Rent. ASSET.
Increase by DEBIT.
Normal Balance is DEBIT.
Prepaid rent means that the company paid for rent in advance and so it owed till the rent can be apportioned to a particular period. For this reason it is an asset and increases by DEBIT.
h. Utilities Expense. EQUITY.
Increases by DEBIT.
Nomal Balance is DEBIT.
As an expense that goes from the revenue it is an equity item and increases by debit. Normal Balance is also debit.
i. Dividends. EQUITY.
Increases by DEBIT.
Normal Balance is DEBIT.
Dividends are paid from Retained Earnings and as such belong in the Equity section. Dividends increase by being debited.
j. Service Revenue. EQUITY.
Increase by CREDIT.
Normal Balance is CREDIT.
As Revenue for the business it belongs in the EQUITY section. It is added to retained earnings and as it is revenue, it increases when it is credited.
Real-Balances Effect Household Expectations Interest-Rate Effect Personal Income Tax Rates Profit Expectations National Incomes Abroad Government Spending Answer the question based on the accompanying list of factors that are related to the aggregate demand curve. Changes in which two of the factors would most likely cause a shift in aggregate demand due to a change in consumer spending.
Answer: Household Expectations
Personal Income Tax Rates
Explanation:
The Aggregate Demand curve can shift as a result of Consumer Spending, Government Spending, Investment Spending or Net Export spending.
When the AD shifts due to a change in Consumer Spending, the reasons are usually related to individuals in the economy including Households.
One of the reasons there may be a shift is due to changes in Household Expectations.
If a Household expects an Economic variable such as Inflation to change in the future, it might inspire them to act now to take advantage of it. For example, if a Household expects that car prices will rise in future, they may decide to buy a car now instead so as not to pay a higher amount in future thus increasing demand and shifting the AD curve Right.
Another reason could be the Personal Income Tax rate. Taxes reduce the amount that people have after they are paid. A change in personal income tax rates therefore is a change in people's income. If Personal Tax rates were to reduce for instance, that would mean that people would have more money to spend and they might consume this extra money. This would increase Consumption and therefore shift the AD curve Right.
In the airline industry, frequent flyer programs, ticket kiosks, and e-ticketing are all examples of capabilities that are __________ but no longer __________. a. valuable; rare b. rare; valuable c. valuable; causally ambiguous d. socially complex; rare
Answer:
a. valuable; rare
Explanation:
There are various examples of capabilities like
1. Frequent flyer programs are nothing but while booking an online flight you just need to sign up so that the chances of earning reward points could be high
2. The ticket kiosks refer to the self service in which you can purchase the tickets related to the entertainment
3. E-ticketing is online ticketing which you can store online instead of keeping it with you in a paper form
These are valuable examples but there are no longer rare
Hence, the first option is correct
The annual premium for a $ 15 comma 000 15,000 insurance policy against the theft of a painting is $ 300 300. If the (empirical) probability that the painting will be stolen during the year is 0 . 03 .03, what is your expected return from the insurance company if you take out this insurance?
Answer:
P(x)=0.97
E(x)=$150
Explanation:
The expected return from the insurance company if the I nsurance is taken out will be:
A.Let assume x is the random variable for the amount received from the Insurance company.
Therefore:
x =$300-$0
=$300-$15,000
P(x)=1-0.03=0.97
P(x)=0.03
B.
E(x)=0.97×$300-$14,700×0.03
=$291-$441
=$150
A company reports the following beginning inventory and two purchases for the month of January. On January 26, the company sells 350 units. Ending inventory at January 31 totals 150 units. Units Unit Cost Beginning inventory on January 1 320 $ 3.00 Purchase on January 9 80 3.20 Purchase on January 25 100 3.34 Required: Assume the periodic inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on the FIFO method.
Answer:
494.00
Explanation:
The computation of the cost assigned to ending inventory using the FIFO method is shown below:
Particulars Units Unit Cost Amount
Purchase on January 9 50 3.20 160.00
Purchase on January 25 100 3.34 334.00
Cost of Ending Inventory 150.00 494.00
Since there are 150 units in the ending inventory so we take 50 units at $3.20 and the rest 100 units at 3.34 so that the cost assigned to the ending inventory could come
1. If you and your BSG team decided to explore the possibility of diversification beyond the athletic shoe market, what factors would you consider to be positive factors in selecting a diversification target and why; i.e. what positive elements would you be looking for in making your decision? 2. What factors would discourage you from pursuing a diversification strategy with another firm and why?
Answer: provided in the explanation section
Explanation:
The process of diversification has to do with connecting to new business opportunity with the existing business. This business startegy helps the company to enter a new area of the market in which it is not currently working. The risk associated with it can or may not provide extraordinary benefits.
In these cases, there are positive factors that encourage diversification-
Other companies will handle the losses in the current company.
Unpleasant surprises can be offset by market diversification.
The resources used under these can be used in sports shoe styling in game simulation companies such as background designers, creative team and so on.
The customer base would be more like that, thereby reducing the attempt of the company to shape a whole new customer base.
If the gaming business starts to decline at any time, all its resources can be used in this new business.
There are always, however, factors which prevent such diversifications.
This can restrict business growth opportunities in the gaming sector as new companies can get investment that is needed to be more competitive.
More new skilled employees, equipment and resources will be needed as the production requires a whole new set of know-how and equipment.
A poorly managed diversification will cause existing businesses to suffer.
As this is a broad horizontal diversification, they can not respond with the same speed to market changes.
Cheers I hope this helps !!!
Obtain the linear trend equation for the following data on new checking accounts at Fair Savings Bank and use it to predict expected new checking accounts for periods 16 through 19. (Round your intermediate calculations and final answers to 2 decimal places.)
Period New Accounts Period New Accounts Period New Accounts
1 200 6 239 11 281
2 215 7 241 12 275
3 211 8 250 13 282
4 224 9 254 14 288
5 235 10 267 15 308
Y = + t
Y16 =
Y17 =
Y18 =
Y19 =
Use trend-adjusted smoothing with %u03B1 = .2 and %u03B2 = .1 to smooth the new account data in part a. What is the forecast for period 16? (Use the "Trend" values to 3 decimal places and other values to 2 decimal places for intermediate calculations. Round your final answer to 2 decimal places.)
Answer:
Y16 = 7(16) + 195.33 = 307.33
Y17 = 7(17) + 195.33 = 314.33
Y18 = 7(18) + 195.33 = 321.33
Y19 = 7(19) + 195.33 = 328.33
Explanation:
Period (x)
New accounts (Y)
The regression equation:
Y = mx + t
Y is the dependent variable
X is the independent variable
t point where trend line cuts through the x-axis
M is the gradient or slope
Using the regression calculator, the trend line for the data is :
Y = 7X + 195.33
Using the regression equation obtained :
Y16 = 7(16) + 195.33 = 307.33
Y17 = 7(17) + 195.33 = 314.33
Y18 = 7(18) + 195.33 = 321.33
Y19 = 7(19) + 195.33 = 328.33
Maxwell and Smart are forming a partnership. Maxwell is investing a building that has a market value of $100,000. However, the building carries a $36,000 mortgage that will be assumed by the partnership. Smart is investing $61,000 cash. The balance of Maxwell's Capital account will be:
Answer:
=$64,000
Explanation:
Max and Smart are forming partnership
Market Value of building = 100,000
The building carried mortgage by the partnership= 36,000
Smart is investing= 61,000
Balance of Maxwell capital Account will be Building value - Mortgage on building
=$100,000 - $36,000
=$64,000
Balance of Maxwell capital Account is equals to =$64,000
Capital account is the account that show the net worth of an enterprise or business in accounting.
Wrong Meds, Again! “It was horrible,” said the distraught client. “No matter how many times I provided the information, no one listened to me. And they obviously didn’t listen to each other either, because they used the wrong meds . . . again.” “Okay, calm down. Now tell me what happened from the beginning,” urged Melanie Torrent, the Quality Assurance Manager for Hope Memorial Hospital. “I got a call at work saying my father was being taken to the hospital from the nursing home. The nursing home always sends a list of medications with the ambulance, but when I got to the emergency room, they were asking my dad what medications he was taking. Of course my dad told them he wasn’t taking any medications and they believed him! He’s sent to the emergency room from a nursing home and they decide it’s reasonable for him not to be on any medications . . . so of course I corrected him and told them to find the medication list. I don’t know whether the ambulance driver forgot to bring in the list, or gave it to the wrong person, or what, but they couldn’t find it. My dad must be on 12 different medications so I wasn’t sure I could remember them correctly. I called the nursing home and we went over the list with them, and then I gave the handwritten list to the nursing station. In the meantime, my dad was admitted to the hospital and moved to a hospital room. Again, a nurse came in with a computer and asked me to tell them what meds he was talking. I tried to tell them that the emergency room had the list, but she said it would be the next morning before the list got updated online. Nevertheless, the nurse called down to the emergency room and was faxed up the list of medications. Only the fax was unreadable, so they came back to me. It was a few hours before his next meds were due, so I drove over to the nursing home, had them make several legible copies of the meds list and drove back to the hospital. I gave the nurse the list, kept one for myself and posted the other on the bulletin board in my dad’s room. The nurse thanked me and said she’d take care of it at the end of her shift. After a long night at the hospital, I woke up the next morning to see my dad hallucinating. I knew immediately what had happened—there’s a certain drug that he has this reaction to. I ran down to the nurse’s station and had her look up the medications he had been given. Sure enough, it was there, along with several other medications he should no longer be taking. Turns out, the list was from two years ago when he had last been admitted to the hospital! How could they have made that kind of mistake—using data from two years ago?” “That is something we’ll look into. More importantly, has your father been taken off the drug?” “Yes.” “And has the medication list been corrected?” “Yes.” “And how is he doing today?” “Fine today, but it could have been more serious and I think you should look into changing your procedures so this doesn’t happen again . . .” “I appreciate you bringing this to my attention. I will speak to the persons involved and I assure you this will not happen again. Hope Memorial prides itself on being a caring and responsible health care provider. Now if you’ll excuse me, I have another client to see . . .” 1. Trace the path of the medication list and denote possible failure points. Construct a process flowchart of the existing process and create a new chart of an improved process. 2. Was the medication error a failure of individuals or a failure of the process? Explain. 3. Think about the different settings, the ambulance, the emergency room, the hospital room, and the nurse’s station. How is data handled in each scenario? Can the process of recording information be changed so that every one is using the same data? How can the accuracy of the data be assured? 4. Given Melanie’s reaction, do you think this error will happen again? Why or why not?
Answer:
Explanation:
no it will not happen agian because she learned from her mistake!
Discount-Mart issues $19 million in bonds on January 1, 2021. The bonds have a seven-year term and pay interest semiannually on June 30 and December 31 each year. Below is a partial bond amortization schedule for the bonds: Date Cash Paid Interest Expense Increase in Carrying Value Carrying Value 01/01/2021 $ 17,233,953 06/30/2021 $ 950,000 $ 1,034,037 $ 84,037 17,317,990 12/31/2021 950,000 1,039,079 89,079 17,407,069 06/30/2022 950,000 1,044,424 94,424 17,501,493 12/31/2022 950,000 1,050,090 100,090 17,601,583 What is the market annual rate of interest on the bonds
Answer: 12%
Explanation:
The semi annual market rate of interest on the bonds will be the interest expense divided by the carrying value i.e issue price of bond which is then multiplied by 100%. This will be mathematically expressed as:
= 1,034,037/17,233,953 × 100
= 0.06 × 100
= 6%
This implies that the semi annual market interest rate is 6%.
Since we are told to calculate the market annual rate of interest on the bonds, we multiply the value of 6% by 2 since 12 months make a year and we used 6 months for the calculation above which is semi annual. This will be:
= 6% × 2
= 12%
Therefore, the market annual rate of interest on the bonds is 12%
Find the nominal annual rate of interest compounded monthly if $1200 accumulates to $1618.62 in five years.
Answer:
The nominal annual interest rate is 6%
Explanation:
The future value of a sum of money an be calculated as follows,
FV = PV (1+i)^n
Where,
PV is present value i is the interest raten is the number of compounding periodsAs we already know the FV, the PV and the number of compounding periods, we can calculate the value of i. The value of i here represents the nominal annual interest rate denominated in monthly terms.
Annual interest rate denominated in monthly terms = Annual i / 12
As the total period in years is 5 years, the total period in monthly terms will be 5 * 12 = 60. So n is 60.
Plugging in the available values, we get the following expression which should be solved to get the monthly i.
1618.62 = 1200 * (1+i)^60
1618.62 / 1200 = (1+i)^60
1.34885 = (1+i)^60
Taking the 60th root of both sides.
(1.34885)^1/60 = (1+i)^60/60
1.004999998 = 1 + i
1.00499998 - 1 = i
i = 0.00499998 rounded off to 0.005 or 0.5%
If the annual interest rate denominated in monthly terms is is 0.005 or 0.5%, then the annual interest rate is,
Annual interest rate = 0.005 * 12 = 0.06 or 6%
A store sells 20 ice cream bars per hour for $4 each, but on discount days, it sells 35 ice cream bars per hour for $3. Based on these two data points, what would be the slope for the relationship between the price and the quantity of ice cream sold?
Answer:
The slope for the relationship between the price and the quantity of ice cream sold would be of -1/15
Explanation:
In order to calculate the slope for the relationship between the price and the quantity of ice cream sold we would have to calculate the following formula:
Slope= change in yaxis( vertical)/change in xaxis(horizontal)
Slope= change in price/change in quantity demand
Slope=P2-P1/Q2-Q1
Slope=3-4/35-20
Slope=-1/15
The slope for the relationship between the price and the quantity of ice cream sold would be of -1/15
Cinnamon Buns Co. (CBC) started 2018 with $52,600 of merchandise on hand. During 2018, $297,000 in merchandise was purchased on account with credit terms of 3/10 n/30. All discounts were taken. Purchases were all made f.o.b. shipping point. CBC paid freight charges of $9,400. Merchandise with an invoice amount of $2,100 was returned for credit. Cost of goods sold for the year was $309,000. CBC uses a perpetual inventory system. Assuming CBC uses the gross method to record purchases, ending inventory would be:
Answer:
$39,053
Explanation:
The computation of the ending inventory is shown below:
Beginning inventory $52,600
Add: Inventory purchased $297,000
Add: Freight in $9,400
Less: Merchandise returned -$2,100
Less: Discounts -$8,847 ($297,000 - $2,100) × 3%
Less: Cost of goods sold -$309,000
Ending inventory $39,053
Hence, the ending inventory using the gross method is $39,053
Magpie Corporation uses the total cost method of product pricing. Below is cost information for the production and sale of 60,000 units of its sole product. Magpie desires a profit equal to a 25% return on invested assets of $700,000. Fixed factory overhead cost $38,700 Fixed selling and administrative costs 7,500 Variable direct materials cost per unit 4.60 Variable direct labor cost per unit 1.88 Variable factory overhead cost per unit 1.13 Variable selling and administrative cost per unit 4.50 The markup percentage on total cost for Magpie's product is
Answer:
Mark-up =22.64%
Explanation:
Profit = Return on Investment (%) × assets\
Profit = 25% × 700,000 = 175,000
Total variable cost = (4.60+ 1.88+ 1.13+ 4.50 )× 60,000= 726600
Total cost = Total variable cost + total fixed cost
= 726600 + 38,700+ 7,500= 772800
Mark-up = profit/cost × 100
= 175,000/726,600 × 100 = 22.64%
Mark-up =22.64%
Suppose the government is considering an increase in the toll on a certain stretch of highway from $.40 to $.50. At present, 50,000 cars per week use that highway stretch; after the toll is imposed, it is projected that only 45,000 cars per week will use the highway stretch. Assuming that the marginal cost of highway use is constant (i.e., the supply schedule is horizontal) and equal to $.40 per car, what is the change in social surplus attributable to the increase in the toll
Answer:
$250 is the change in social surplus attributable to the increase in the toll
Explanation:
Suppose the government increase in toll on a certain stretch of highways by this caused a dead-weight loss occur and then resulting full in the number of cars using the highway.
Dead-weight loss = (0.5) (0.50-0.40) (50,000-45,000)
Dead-weight loss = 0.5 * 0.10 * 5000
Dead-weight loss = $250
The increase paid by other remaining drivers (0.50-0.40)(40,000) can be viewed as transfer from drivers to the government.