Answer:
Markup percentage = 150%
Explanation:
Markup = Selling Price - Cost
Total Cost = Variable + Fixed
Variable Costs = Manufacturing + Selling and Administrative
= $28,000 + $12,000 = $40,000
Fixed Costs = Manufacturing + Selling and Administrative
= $160,000 + $120,000 = $280,000
Total Cost = $40,000 + $280,000 = $320,000
Cost per unit = $320,000/ 5,000 = $64 per unit
Return on Investment = $1,600,000 X 30% = $480,000
Selling Value = Total Cost + Profit or Return = $320,000 + $480,000 = $800,000
Selling Price per unit = $800,000/5,000 = $160
Markup Percentage = [tex]\frac{Selling price - Cost per unit}{Cost per unit} X 100[/tex]
= [tex]\frac{160-64}{64} X 100 = 150[/tex] percent
= 150%
Company J must choose between two alternate business expenditures. Expenditure 1 would require a $30,000 cash outlay and Expenditure 2 requires a $28,500 cash outlay. Determine the marginal tax rate at which the after-tax cash flows from the two expenditures are equal assuming that Expenditure 1 is fully deductible and Expenditure 2 is nondeductible. Determine the marginal tax rate at which the after-tax cash flows from the two expenditures are equal assuming that Expenditure 1 is 50% deductible and Expenditure 2 is nondeductible. Determine the marginal tax rate at which the after-tax cash flows from the two expenditures are equal assuming that Expenditure 1 is fully deductible and Expenditure 2 is 50 percent deductible.
Hey there!:
case 1 :
Above statement means that Expenditure 1 = 30000 shall be reduced by an amount of tax saving ( since fully deductible) but expenditure - 2 = 28500 is final. ( since no tax saved)
Let............ r = tax rate. To convert any expenditure to after tax by reducing tax saving, we will multiply that expenditure with (1 - r)
So .............. 30000(1- r) = 28500
( 1 - r ) = 28500/30000 = 0.95
1 - r = 0.95 => ............r = 0.05
So Marginal tax rate must be 5%
_________________________________________________
case 2 :
30000 ( 1 - 50%(r) ) = 28500
( 1 - 50%(r) ) = 28500/30000 = 0.95
- 50%(r) = 0.95 - 1 = - 0.05
0.50 * r = 0.05 ( negative cancelled on either sides)
r = 0.05 / 0.5 = 0.10 ..............(or) 10%
Thus marginal tax rate must be 10%
__________________________________________________
Case 3 :
30000 ( 1 - r ) = 28500 ( 1 - 50%( r ) )
Expanding .......... 30000 - 30000*r = 28500 - 28500*50%*r
30000 * r - 14250 * r = 30000 - 28500
15750 * r = 1500
r = 1500/15750 = 0.0952 .(or) 9.52%
So Marginal tax rate must be 9.52%
_________________________________________________________
Hope this helps!
To determine the marginal tax rate at which the after-tax cash flows from the two expenditures are equal, we need to compare the after-tax cash flows for each expenditure. We can calculate the cash flows after tax for different scenarios and set them equal to find the marginal tax rate. This can be done for various combinations of deductible and nondeductible expenditures.
Explanation:To determine the marginal tax rate at which the after-tax cash flows from the two expenditures are equal, we first need to calculate the after-tax cash flows for each expenditure.
Case 1: Expenditure 1 is fully deductible and Expenditure 2 is nondeductible:Expenditure 1: $30,000 (fully deductible) -> Cash flow after tax = $30,000
Expenditure 2: $28,500 (nondeductible) -> Cash flow after tax = $28,500 * (1 - marginal tax rate)
To find the marginal tax rate at which the after-tax cash flows are equal, we set the two cash flows equal to each other and solve for the marginal tax rate:
$30,000 = $28,500 * (1 - marginal tax rate)
By solving this equation, we can find the marginal tax rate.
Case 2: Expenditure 1 is 50% deductible and Expenditure 2 is nondeductible:Expenditure 1: $30,000 * 50% (deductible) -> Cash flow after tax = $15,000
Expenditure 2: $28,500 (nondeductible) -> Cash flow after tax = $28,500 * (1 - marginal tax rate)
Again, we set the two cash flows equal to each other and solve for the marginal tax rate to find the point of equality.
Case 3: Expenditure 1 is fully deductible and Expenditure 2 is 50% deductible:Expenditure 1: $30,000 (fully deductible) -> Cash flow after tax = $30,000
Expenditure 2: $28,500 * 50% (deductible) -> Cash flow after tax = $14,250
Again, we set the two cash flows equal to each other and solve for the marginal tax rate to find the point of equality.
Learn more about marginal tax rate here:https://brainly.com/question/34084280
#SPJ2
If you draw a card with a value of three or less from a standard deck of cards, I will pay you $146. If not, you pay me $24. (Aces are considered the highest card in the deck.)Step 1 of 2 :Find the expected value of the proposition. Round your answer to two decimal places. Losses must be expressed as negative values.
Answer: Expected value = $2.034
Explanation:
Total outcome = 52
Favorable Outcome = 8
Probability of drawing a card with a value of three or less = [tex]\frac{Favorable\ outcome}{Total\ outcome}[/tex]
= [tex]\frac{8}{52}[/tex]
= [tex]\frac{2}{13}[/tex]
Probability of drawing a card with a value of more than three = 1 - [tex]\frac{2}{13}[/tex]
= [tex]\frac{11}{13}[/tex]
Hence,
Expected value = [tex]146 \times \frac{2}{13} + (-24) \times \frac{11}{13}[/tex]
= 22.338 - 20.304
= $2.034
The outstanding bonds of The Purple Fiddle are priced at $898 and mature in nine years. These bonds have a 6 percent coupon and pay interest annually. The firm's tax rate is 35 percent. What is the firm's after tax cost of debt?
Answer : 4.34 %
Explanation: The effective interest rate a company pays on its debt obligation is called cost of debt. The cost of debt is denoted by [k]x_{d}[/tex] . As there is a tax shield available on debt interest it is generally calculated by subtracting the marginal tax rate from before tax cost of debt .
.
[tex]k_{d}=\frac{c}{p}\times\left ( 1-t \right ) [/tex]
where,
c= coupon payment = 1000 * 6% = 60
p = current market price = $898
t= marginal tax rate
therefore :-
= [tex]\frac{60}{898}\times \left ( 1-0.35 \right )[/tex]
= 4.34 %
Dim Corporation purchased 1,000 bonds of Witt Corporation in 2015 for $790 per bond and classified the investment as securities available for sale. The value of these holdings was $272 per bond on December 31, 2016, and $404 on December 31, 2017. During 2018, Dim sold all of its Witt bonds at $490 per share. In its 2018 income statement, Dim would report:
Answer:
In the income statemnt for 2018
Gain on Sale of Bonds 86,000
Explanation:
This securities available for sale will be measurement at fair value, through profit and loss
2018 Beginning Valuation
1,000 bonds x 404 = 404,000
Value at sale
1,0000 x 490 = 490,000
Gain on Sale of Bonds 86,000
Green Woods sells specialty equipment for mountain climbers. Its sales for last year included $238,000 of tents and $411,000 of climbing gear. For next year, management has decided to sell specialty sleeping bags also. As a result of this change, sales projections for next year are $264,000 of tents, $426,000 of climbing gear, and $51,000 of sleeping bags. How much of next year's sales are derived from the side effects of adding the new product to its sales offerings?
Answer:
By $41,000 the next year's sales are derived from the side effects of adding the new product to its sales offerings.
Explanation:
For calculating the sale for next year, the tent expense and climbing gear is to be considered. With the help of these, the next year sale from the side effects can be derived. The sleeping bag cost is not to be considered so it would not be taken for calculation. The computation is shown below:
= (Tent Expense Next year + Climbing gear Next year ) - (Tent Expense Previous year + Climbing gear Previous year )
= ( $264,000 + $426,000) - ( $238,000 + $411,000)
= ($690,000 - $649,000)
= $41,000
Thus, by $41,000 the next year's sales are derived from the side effects of adding the new product to its sales offerings.
Which of the following statements are true regarding profit-maximizing firms?A.They will attempt to maximize the difference between total revenues and total costs.B.They will use more of a resource as long as the marginal resource cost (MRC) is greater than the marginal revenue product (MRP).C.They will only produce where MRP is positive and MRC is negative.D.none of the above.
Answer:
For a profit maximizing firm , the statement that will be true is A) they will attempt to maximize the difference between total revenues and total costs.
Explanation:
The basic formula that is used to calculate profit is -
Profit = Total revenue - Total cost
Profit maximization is a concept according to which a firm who is looking for maximizing its profits, should choose that optima level of output where its marginal cost ( cost that is incurred because of producing one additional unit of good ) and marginal revenue ( change in revenue because of change in sales ) are same.
When the marginal revenue is greater than the marginal cost , it means that the revenues generated by producing additional quantity of goods is greater than the cost incurred on producing them, so hence we can say that for maximizing profit , a firm would want that the gap between revenue and cost is higher.
Raymond Financing leases airplanes to airline companies. Raymond has just signed a 20-year lease agreement that requires annual year-end lease payments of $900,000. What is the present value of the lease using a 10% interest rate?
Answer:
7662207.35
Explanation:
We are asked to find the present value of a 20 years annuity at rate equal 10%
[tex]present \: value = annuity \times \frac{1 - {(1 + rate)}^{ - time} }{rate} [/tex]
[tex]900000 \times \frac{1 - {1.1}^{ - 20} }{.1} = 7662207.35[/tex]
Remember:
on present time: power is negative and the 1 comes first
[tex]1 - {(1 + rate)}^{ - time} [/tex]
on future value: the power is positive and comes first then you subtract 1
[tex] {(1 + rate)}^{time} - 1[/tex]
national Mining Corp. purchased a mine, which holds an estimated 031,000 tons of iron ore, on January 1, 2018, for $ 526,000. The mine is expected to have zero residual value. The business extracted and sold 12,500 tons of ore in 2018 and 11,800 tons of ore in 2019. What is the depletion expense for 2018? (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)
The depletion expense for National Mining Corp. for the year 2018, given the mine purchase cost and the amount of iron extracted and sold in that time, is calculated to be approximately $212,125.
Explanation:To find out the depletion expense for 2018, we first need to determine the depletion rate. The depletion rate is the cost of the mine divided by the estimated total extractable amount of iron ore. In this case, it will be $526,000 divided by 31,000 tons, which equals $16.97 per ton (rounded to two decimal places).
Then, we multiply the depletion rate by the amount of iron ore that was extracted and sold in 2018. So, the depletion expense would be $16.97 per ton times 12,500 tons, equaling $212,125 (rounding to the nearest dollar).
Learn more about Depletion Expense here:https://brainly.com/question/36655153
#SPJ12
On March 1, 2015, Landon Company acquired real estate on which it planned to construct a small office building. The company paid $90,000 in cash. An old warehouse on the property was razed at a cost of $7,600; the salvaged materials were sold for $1,700. Additional expenditures before construction began included $1,100 attorney's fee for work concerning the land purchase, $4,000 real estate broker's fee, $7,800 architect's fee, and $14,000 to put in driveways and a parking lot. Determine the amount to be reported as the cost of the land.
Answer:
The amount to be reported as the cost of the land is $101,000
Explanation:
Given information
Paid cash - $90,000
Cost of property $7,600
Salvaged materials - $1,700
Attorney's fee for work concerning the land purchase - $1,100
Real estate broker's fee - $4,000
Architect's fee - $7,800
Put in driveways and a parking lot - $14,000
For computing the amount of the cost of the land, the Architect's fee and Put in driveways and a parking lot is not considered as it is not related to the land expenses. The computation is shown below
= Cash amount + Cost of property - Salvaged materials + Attorney's fee + Real estate broker's fee
= $90,000 + $7,600 - $1,700 + $1,100 + $4,000
= $101,000
Thus, the amount to be reported as the cost of the land is $101,000
Christine is an artist who creates custom cookie jars. Her annual revenue from selling the cookie jars is $90,000. The annual explicit costs of the materials used to make the cookie jars are $54,000. Refer to Scenario 13-13. Christine used $5,000 from her personal savings account to buy pottery tools for her business. The savings account paid 1% annual interest. Christine could earn $6,000 per year as a tax preparer. What is the annual economic profit of her cookie jar business?
Answer: $29,950
Explanation: As we know that,
Economic profit = Total revenues - (explicit cost + implicit cost)
where,
Explicit costs are payments made to others for running operations of business.
Implicit cost or opportunity cost can be defined as the cost of loosing profits for choosing one alternative instead of other.
In the given case the interest of $50 on savings and $6000 salary is the implicit cost.
Economic profit = $90,000 - ($54,000 + $50 + $6,000)
= $29,950
Christine's economic profit, which accounts for both explicit and implicit costs, is $24,950 per year.
Explanation:Calculating the annual economic profit for Christine’s cookie jar business
To calculate Christine's economic profit, we need to consider both explicit and implicit costs. Explicit costs are the actual out-of-pocket costs, such as the cost of materials for the jars ($54,000), and the cost of pottery tools she bought for her business ($5,000). So the total explicit cost is $54,000 + $5,000 = $59,000.
Implicit costs are the opportunity costs that are foregone by not using the resources in their next best alternative. In this scenario, Christine's implicit costs include the foregone interest on her savings ($5,000 x 0.01 = $50) and the income she could have earned as a tax preparer ($6,000). So, the total implicit cost is $50 + $6,000 = $6,050.
The Economic profit is calculated by subtracting both explicit and implicit costs from the total revenue. Therefore, Christine's economic profit is $90,000 (revenue) - $59,000 (explicit cost) - $6,050 (implicit cost) = $24,950.
Learn more about Economic Profit here:https://brainly.com/question/33205053
#SPJ3
If a project's discounted payback period is less than its useful life, _____.
a. the terminal value of its future cash inflows is less than the future value of its initial cost
b. the present value of its future cash inflows is greater that the future value of its initial cost
c. the present value of its future cash flows exceeds its initial cost
d. its future cash inflows are less than its initial cost
e. its cost-recovery time should exceed the maximum cost-recovery time established by the firm
Answer:
e. Its cost-recovery time should exceed the maximum cost-recovery time established by the firm
Explanation:
If a project's discounted payback period is less than its useful life, its cost-recovery time should exceed the maximum cost-recovery time established by the firm.
Mart's Boutique has sales of $820,000 and costs of $540,000. Interest expense is $36,000 and depreciation is $59,000. The tax rate is 21 percent. What is the net income? $146,150 221,200 105,000 139,050
Answer:
$146,150.00
Explanation:
Net income is net of taxes.
Here,
Sales = $820,000.00
Less: Costs = -$540,000.00
Gross profit = $280,000.00
Less: Finance Costs
Interest = -$36,000.00
Depreciation = -$59,000.00
Net profit before Tax = $185,000.00
Less: Tax @ 21% of $185,000.00 = - $38,850.00
Net Income (after tax) = $146,150
Net income is always computed after tax.
$146,150.00
Final answer:
To find Mart's Boutique net income, subtract the costs and depreciation from sales, then subtract interest expense and taxes. The boutique's net income is $146,150.
Explanation:
To calculate the net income for Mart's Boutique, we begin with sales and subtract the costs:
Sales: $820,000Costs: $540,000Depreciation: $59,000Interest Expense: $36,000The operating profit is calculated as Sales minus Costs and Depreciation. Then we subtract the Interest Expense to get the pre-tax income:
Operating Profit = Sales - Costs - DepreciationOperating Profit = $820,000 - $540,000 - $59,000Operating Profit = $221,000Pre-tax Income = Operating Profit - Interest ExpensePre-tax Income = $221,000 - $36,000Pre-tax Income = $185,000Finally, we calculate the net income by subtracting the tax, which is 21% of the pre-tax income:
Tax = Pre-tax Income × Tax RateTax = $185,000 × 0.21Tax = $38,850Net Income = Pre-tax Income - TaxNet Income = $185,000 - $38,850Net Income = $146,150Mart's Boutique has a net income of $146,150.Which of the following is correct? a. U.S. exports as a percentage of GDP have about tripled since 1950. The U.S. currently has a trade deficit. b. U.S. exports as a percentage of GDP have about doubled since 1950. The U.S. currently has a trade deficit. c. U.S. exports as a percentage of GDP have about doubled since 1950. The U.S. currently has a trade surplus. d. U.S. exports as a percentage of GDP have about tripled since 1950. The U.S. currently has a trade surplus.
Answer: Option (b) is correct.
Explanation:
U.S. exports as a percentage of GDP have about doubled since 1950. The U.S. currently has a trade deficit.
The moving of a portion of the manufacturing facilities from US to other minimal effort Asian nations, because of which US has begun import from those nations rather producing at home.
The US individuals don't spare much, yet the economy needs capital for venture purposes because of which US has been net shipper of capital streams. This net import of capital streams makes it to pay for the imports of items and administrations from different nations.
Companies that manufacture identical items through a series of uniform production steps use ________ to determine the cost per unit produced. a) a job order costing system b) a process costing system c) both of these systems d) neither of these systems
Companies that manufacture identical items through a series of uniform production steps use to determine the cost per unit produced a process costing system.- b)
Companies that manufacture identical items through a series of uniform production steps use to determine the cost per unitproduced a process costing system.
Scott's Lawn Care has hired Henry Associates to find out whether home improvement warehouse stores communicate the benefits of various brands of lawn care products differently than smaller stores. Henry Associates needs to know what is communicated to consumers in the actual settings of the stores and wants to ensure that the message isn't filtered. Only behavioral data is required. Which type of data collection method is most appropriate in this situation? A. CommunicationB. ObservationC. SurveysD. ExperimentalE. Causal
Answer:
The correct answer is option B. observation.
Explanation:
Observation is a method of data collection which involves the use of all the senses to study people in their natural setting. The process involve gathering knowledge about a phenomena by making observations. The aim here is to focus on human behavior, human interaction with phenomenon and the use of phenomenon..
In the above example, actual setting and behavioral data is required. So, the most appropriate method for data collection here will be observation.
Before Maria starts her first year of college, Fred promises to give her $5,000 when she graduates. She goes to college, borrowing and spending far more than $5,000. At the beginning of the spring semester of her senior year, she reminds Fred of the promise. Fred sends her a note that says, “I revoke the promise.” Is Fred's promise binding? Explain.
Final answer:
Fred's promise to Maria is likely binding, as Maria's attendance in college constitutes substantial performance. In contract law, once substantial performance is underway, a promisor typically cannot revoke the promise. Therefore, Fred is expected to honor his initial promise to Maria.
Explanation:
The question of whether Fred's promise is binding revolves around the concept of a unilateral contract. In a unilateral contract, one party makes a promise in exchange for a specific action by another party. Fred promised Maria $5,000 upon her graduation, but he attempted to revoke the promise before she fulfilled the condition. Traditionally, once the action that fulfills the conditions of the promise is underway—a concept referred to as substantial performance—the promisor cannot revoke the promise. Maria going through college can be seen as substantial performance, and thus Fred may be expected to honor his promise regardless of his intent to revoke it. This is consistent with principles from contract law, which might be exemplified by texts such as "LibreTexts™", where the importance of fulfilling contract terms and recognizing substantial performance is affirmed.
Pierre left a message on Shayna’s voicemail stating, “Hey Shayna. Regarding that painting we talked about. I changed my mind and I do want to sell it. So I’ll let you have it for a steal at $350. There are lots of people that want it so let me know if you don’t ASAP. I’ll assume you do want it if I don’t hear from you within an hour. Thanks!” This is not a valid contract and Shayna would not be required to purchase painting due to the lack of a(n):
The contract between Pierre and Shayna is not a valid contract due to the lack of acceptance from Shayna.
Further Explanation:
Contract:
A legally enforced agreement is considered a contract. An agreement is a promise between two parties to perform tasks for each other for some consideration. When an agreement becomes legally enforced, then it is considered as a contract. So the contract is a legally enforced promise between two parties for considerations. Both parties should get consideration and have a performance obligation.
Following factors are required for the contract:
Offer: A person should offer some consideration to another person for performing any activity or in the exchange of goods.
Acceptance of offer: The other person should accept the offer made by the first person.
Valuable consideration: There should be valuable consideration for both the parties.
Mutual obligation: Parties should promise to execute their obligated activities.
The performance capacity of the parties: Parties should be capable of performing the contract.
Legally enforcement: The contracts should be legally enforced.
These are the basic elements of a contract. If any contracts lack any of the given factors, then it will not be considered as a valid contract.
The contract between Pierre and Shayna:
In the current case, Pierre makes an offer to sell the painting to Shayna. Pierre leaves a message in the voicemail of Shayna, stating that if Shayna does not contact Pierre within one hour, then Pierre would consider that the Shayna wants to purchase the painting.
It is not a valid contract as it lacks the acceptance of the offer from Shayna.
Pierre enters the contract to sell the painting without considering the acceptance of the offer by Shayna. Pierre puts a condition that if she does not receive any revert from Shayna within one hour, then she would consider that Shayna has accepted the offer. For a valid contract, the promisee should accept the offer but the condition of acceptance (revert within one hour) does not state for the acceptance of Shayna. So, it will not be considered a valid contract.
Thus, the contract between Pierre and Shayna is not a valid contract due to non-acceptence.
Learn more:
1. Learn more about the cash deficiency
https://brainly.com/question/12981857
2. Learn more about the span of control
https://brainly.com/question/12986822
3. Learn more about the sales budget
https://brainly.com/question/12985585
Answer details:
Grade: Senior School
Subject: Business Law
Chapter: Contract Act
Keywords: Pierre, message, Shayna, voicemail, painting, mind, sell, steal, people, ASAP, hear, within an hour, not a valid contract, purchase a painting, lack of a(n), contract act, agreement, law, business law, promise, valid contract.
This problem has been solved!
See the answer
Peroni Company paid wages of $170,900 this year. Of this amount, $114,000 was taxable for net FUTA and SUTA purposes. The state's contribution tax rate is 3.1% for Peroni Company. Due to cash flow problems, the company did not make any SUTA payments until after the Form 940 filing date. Compute the following; round your answers to the nearest cent.
a. Amount of credit the company would receive against the FUTA tax for its SUTA contributions
$
b. Amount that Peroni Company would pay to the federal government for its FUTA tax
$
c. Amount that the company lost because of its late payments
$
a. (Taxable wages x SUTA rate x 90%) + [Taxable wages x (5.4% -SUTA rate)] = Total FUTA tax credit
b. (Taxable wages x FUTA rate) – Total FUTA tax credit (part a above) = Net FUTA tax
c. Net FUTA tax – FUTA tax without penalty = penalty
hey there!:
1)
a) Amount of credit the company would receive against the FUTA tax for its SUTA contributions = 2896.21
(56900*3.1%*90%)+(56900*(5.4%-3.1%)) = 2896.21
b) Amount that Peroni Company would pay to the federal government for its FUTA tax = 517.79
(56900*6%)-2896.21 = 517.79
c) Amount that the company lost because of its late payments = 176.39
=517.79-(3414-1763.9-1308.7) = 176.39
Hope that helps!
To find the total FUTA tax, calculate the credit received for SUTA contributions first, then use that to calculate the net FUTA tax. Then, the penalty can be calculated as the difference between the net FUTA tax and the FUTA tax without penalty.
Explanation:To calculate a), the amount of credit the company would receive against the FUTA tax for its SUTA contributions, we use the formula: (Taxable wages x SUTA rate x 90%) + [Taxable wages x (5.4% -SUTA rate)]. Plugging in the provided numbers gives: ($114,000 x 3.1% x 90%) + [$114,000 x (5.4% - 3.1%)]. For b), the amount that Peroni Company would pay to the federal government for its FUTA tax, we use the formula: (Taxable wages x FUTA rate) - Total FUTA tax credit. Calculate the FUTA rate (generally it is 6.0%), then substitute the FUTA tax credit obtained in a). For c), the amount the company lost due to its late payments, we use the formula: Net FUTA tax – FUTA tax without penalty, which gives the penalty.
Learn more about FUTA and SUTA Tax Calculation here:https://brainly.com/question/33720518
#SPJ3
Estimated manufacturing overhead for the year $ 32,550 Estimated direct labor hours for the year 2,100 Two jobs were worked on during the year: Job A-101 and Job A-102. The number of direct labor-hours spent on Job A-101 and Job A-102 were 1,230 and 1,050, respectively. The actual manufacturing overhead was $39,000. What is the amount of the under- or overapplied manufacturing overhead? Overhead is applied on the basis of direct labor hours. $2,610 overapplied. $3,660 underapplied. $870 underapplied. $6,450 overapplied.
Answer:
Underapplied for 3,660
Explanation:
MO 32,550
DLH 2,100
rate: MO/DLH = 32,550/2,100 = 15.5 MO per DLH
Applied MO:
job 101 : 1,230 hours x 15.5 = 19,065job 102: 1,050 hours x 15.5 = 16,275Total MO 19,065 + 16,275 = 35,340
Actual Overhead 39,000
Underapplied for 3,660
Rolla Company has a choice of two investment alternatives. The present value of cash inflows and outflows for the first alternative is $125,000 and $100,000, respectively. The present value of cash inflows and outflows for the second alternative is $300,000 and $262,500, respectively.
Required
Calculate the net present value of each investment opportunity
Calculate the present value index for each investment opportunity. (Round "PVI" to 2 decimal places.)
Indicate which investment will produce the higher rate of return.
Answer:
Alternative A will produce the best return.
It has a better present value index which means, the investment yield a better rate.
Explanation:
ALTERNATIVE (a)
125,000 - 100,000 = 25,000 NPV
ALTERNATIVE (b)
300,000 - 262,500 = 37,500 NPV
[tex]\frac{CashFlows \: PV}{initial \: investment} = PVI[/tex]
ALTERNATIVE (a)
125.000/100,000 = 1.25
ALTERNATIVE (b)
300,000/262,500 = 1.1429
To calculate the net present value of each investment alternative, subtract the present value of cash outflows from the present value of cash inflows. The present value index is calculated by dividing the present value of cash inflows by the present value of cash outflows. The second investment alternative offers a higher rate of return.
Explanation:The net present value (NPV) of an investment opportunity is the difference between the present value of cash inflows and the present value of cash outflows. To calculate the NPV, subtract the present value of cash outflows from the present value of cash inflows. For the first alternative, the NPV is $125,000 - $100,000 = $25,000. For the second alternative, the NPV is $300,000 - $262,500 = $37,500.
The present value index (PVI) is a measure of investment efficiency. It is calculated by dividing the present value of cash inflows by the present value of cash outflows. For the first alternative, the PVI is $125,000 / $100,000 = 1.25. For the second alternative, the PVI is $300,000 / $262,500 = 1.14.
The investment with the higher rate of return can be determined by comparing the NPVs or PVIs. In this case, the second alternative has a higher NPV and a higher PVI, indicating that it will provide a higher rate of return.
A dozen eggs cost $0.96 in December 2000 and $2.75 in December 2015. The average wage for workers in private industries was $14.28 per hour in December 2000 and $21.26 in December 2015. By what percentage did the price of a dozen eggs rise? 65% 179% 186% By what percentage did the wage rise?
Answer:
By 186% the price of a dozen eggs rise.
Explanation:
Given that,
Cost in December 2000 = $0.96
Cost in December 2015 = $2.75
Average wage for December 2000 = $14.28 per hour
Average wage for December 2015 = $21.26
By considering these information, we are able to calculate the increase price percentage of a dozen eggs. The calculation is shown below:
= (December 2015 price - December 2000 price ) ÷ (December 2000 price) × 100
= ($2.75 - $0.96) ÷ ($0.96) × 100
= ($1.79) ÷ ($0.96) × 100
= 186%
Thus, by 186% the price of a dozen eggs rise.
Final answer:
The price of a dozen eggs increased by approximately 186% from December 2000 to December 2015, while the average wage for workers in private industries rose by approximately 49% over the same period.
Explanation:
To calculate the percentage increase in the price of a dozen eggs from December 2000 to December 2015, first determine the initial and final prices. The price rose from $0.96 to $2.75. Use the formula for percentage increase: Percentage Increase = (New Price - Original Price) / Original Price \ imes 100%.
Plugging in the values gives us: (2.75 - 0.96) / 0.96 \ imes 100% = 1.79 / 0.96 \ imes 100% \\approx 186%.
The average wage increase is similarly calculated: (21.26 - 14.28) / 14.28 \ imes 100% \\\approx 49%.
Nov. 1 Dollar Store purchases merchandise for $1,600 on terms of 2/5, n/30, FOB shipping point, invoice dated November 1. 5 Dollar Store pays cash for the November 1 purchase. 7 Dollar Store discovers and returns $100 of defective merchandise purchased on November 1, and paid for on November 5, for a cash refund. 10 Dollar Store pays $80 cash for transportation costs for the November 1 purchase. 13 Dollar Store sells merchandise for $1,728 with terms n/30. The cost of the merchandise is $864. 16 Merchandise is returned to the Dollar Store from the November 13 transaction. The returned items are priced at $200 and cost $100; the items were not damaged and were returned to inventory. Journalize the above merchandising transactions for the Dollar Store assuming it uses a perpetual inventory system and the gross method.
Answer:
NOV 1
Inventory 1,600
Account Payable 1,600
Nov 5
Account Payable 1,600
Discount received 32
Cash 1,568
Nov 7
Cash 100
Inventory 100
Nov 10
Freight In 80
Cash 80
Nov 13
Account receivable 1,728
Sales Revenues 1,728
Nov 13
COGS 864
Inventory 864
Nov 16
Sales Revenue 200
Account receivable 200
Nov 16
Inventory 100
COGS 100
Explanation:
The changes in inventory valuation must be done imediatly under perpetual inventory system.
Answer:
NOV 1
Inventory 1,600
Account Payable 1,600
Nov 5
Account Payable 1,600
Discount received 32
Cash 1,568
Nov 7
Cash 100
Inventory 100
Nov 10
Freight In 80
Cash 80
Nov 13
Account receivable 1,728
Sales Revenues 1,728
Nov 13
COGS 864
Inventory 864
Nov 16
Sales Revenue 200
Account receivable 200
Nov 16
Inventory 100
COGS 100
Explanation:
Many organizations, such as Google, Zappos, Salesforce, and Yahoo!, are designing the work environment to encourage casual conversations among employees who don't generally work together. They also are "installing playful prompts, like trivia games, to get workers talking in traditional conversational dead zones, such as elevators." It is thought that ________ demonstrate a form of social support for employees, leading them to put more effort into creative behaviors.
Answer:
The correct answer would be, Low stress work environments.
Explanation:
Many big organizations like Google, Yahoo, Salesforce, etc are now a days designing the work environments for employees like something that encourages the casual conversations between employees who don't get in touch with each other generally, for example, employees from different departments. They are also installing playful prompts like trivia games to get workers talking with each other on dead zones. Such type of arrangements will make a low stress environment for employees to work in, and due to low stress work environments, employees would work more efficiently and be progressive for the organization. Employees will have a sense of bond and support from other employees. So it is thought that low stress work environments demonstrate a form of social support for employees, leading them to put more effort into creative behaviors.
It is thought that casual conversations and playful prompts to demonstrate a form of social support for employees, leading them to put more effort into creative behaviors.
Explanation:The blank in the sentence can be filled with 'casual conversations and playful prompts'. Many organizations are nurturing an environment that promotes interactions between employees who wouldn't usually work together. This strategy involves playful interventions like trivia games in typical non-conversational areas. These interventions act as a catalyst for dialogue, which is seen as a form of social support. This support is thought to encourage employees to exert more effort into exhibiting creative behaviors within the workforce.
Learn more about Workplace Interactions here:https://brainly.com/question/37637874
#SPJ2
Which of the following activities are credits? The impact on accounts receivable from a $10 million collection from a customer. The impact on treasury stock from a company repurchasing $32 million in shares. The impact on inventory from a company recognizing $15 million in cost of goods sold expense. The impact on debt from a $15 million principal paydown.
Final answer:
Credits are recorded for the collection from a customer (decreasing Accounts Receivable) and the principal paydown on debt (decreasing liability). Both activities decrease respective accounts, which are naturally debit accounts, so a credit is used to record the decrease.
Explanation:
Among the given activities, the following represent credits: collection from a customer impacting accounts receivable and principal paydown impacting debt. Additionally, the repurchase of shares affects treasury stock but represents a debit rather than a credit. Recognizing cost of goods sold expense affects inventory and also results in a debit instead of a credit.
Explanation:
Collection from a Customer: When a company collects $10 million from a customer, this decreases Accounts Receivable (an asset) and increases Cash (another asset). The decrease in Accounts Receivable is credited because it reduces the asset account.
Principal Paydown: On payment of a $15 million loan principal, the liability account (Debt) decreases. Since liabilities have a credit balance, to reduce them, we debit the account and credit the Cash account to represent the outflow of cash.
A company has a selling price of $2,000 each for its printers. Each printer has a 2 year warranty that covers replacement of defective parts. It is estimated that 3% of all printers sold will be returned under the warranty at an average cost of $154 each. During November, the company sold 34,000 printers, and 440 printers were serviced under the warranty at a total cost of $59,000. The balance in the Estimated Warranty Liability account at November 1 was $31,000. What is the company's warranty expense for the month of November?
Answer:The company's warranty expense for the month of November is $157,080.
Explanation:
When the estimated amount is recognized-
Warranties expense A/c (Dr.) = $157,080
Estimated Warranty Liability (Cr.) = $157,080
When the repairs are actually paid, Estimated Warranty Liability will be Debited and Cash will be credited.so, The company's warranty expense for the month of November is $157,080.
i.e. (34,000 × 3% × $154 = $157,080)
Which of the following entries would record the application of overhead cost correctly? A. Manufacturing Overhead XXX Accounts Payable XXX B. Work in Process XXX Accounts Payable XXX C. Work in Process XXX Manufacturing Overhead XXX D. Manufacturing Overhead XXX Work in Process XXX
The right entry to record the application of overhead cost is 'C. Work in Process XXX Manufacturing Overhead XXX'. Overhead costs are encompassed in the cost of goods in progress, which is reflected in the 'Work in Process' account. The applied overhead cost lessens the balance in the 'Manufacturing Overhead' account and augments the 'Work in Process' account.
Explanation:The correct entry to record the application of overhead cost in accounting would be: C. Work in Process XXX Manufacturing Overhead XXX. This is because overhead costs are absorbed into the cost of goods that are in production, which is monitored under the Work in Process account. The Manufacturing Overhead is an account where indirect costs associated with manufacturing are accumulated. If we apply an overhead cost, it decreases the balance in the Manufacturing Overhead and increases the amount in Work in Process account, reflecting that overhead costs are being utilized in the production process.
Learn more about Overhead cost application here:https://brainly.com/question/32502155
#SPJ2
The correct entry to record the application of overhead cost is D. Manufacturing Overhead XXX to Work in Process XXX, representing the allocation of indirect costs to goods in production within a manufacturing accounting system.
When overhead costs are allocated to production, the Manufacturing Overhead account (which accumulates indirect manufacturing costs) is debited to reflect the actual costs incurred. These costs are then credited to the Work in Process account, increasing the cost of goods being manufactured. This entry does not involve Accounts Payable because the allocation is an internal process rather than an external transaction.
The statement of cash flows explains changes in a firm’s: A) Cash on hand and cash in the bank B) Cash and cash equivalents C) Cash, cash equivalents, and accounts receivable D) Working capital
Answer:
C Cash and cash equivalents
Explanation:
For Cash equivalent, you must understand that is less than 90 days short term-investment which must be readily for convertible to a known amount of cash and practically no risk, again, within 90 days
Source: IFRS IAS 7 Statement of Cash Flows—identification of cash equivalents
The statement of cash flows details changes in a firm's Cash and cash equivalents (B). It lists cash inflows and outflows related to the company's operations and investment activities, but does not directly report on accounts receivable or working capital.
Explanation:The statement of cash flows explains changes in a firm’s B) Cash and cash equivalents. The statement of cash flows is a financial statement that provides aggregate data regarding all cash inflows a company receives from its ongoing operations and external investment sources, as well as all cash outflows that pay for business activities and investments during a given period. Changes in accounts receivable are reflected on the balance sheet and can influence the cash flow statement indirectly, but they are not included in the definition of cash and cash equivalents. The statement does not provide information directly on the firm's working capital, which includes current assets and current liabilities, other than cash and cash equivalents.
Learn more about Statement of Cash Flows here:https://brainly.com/question/32731828
#SPJ6
At a volume of 11,000 units, Pwerson Company incurred $33,000 in factory overhead costs, including $11,000 in fixed costs. If volume increases to 13,000 units and both 11,000 units and 13,000 units are within the relevant range, then the company would expect to incur total factory overhead costs of:
Answer:
$37,000.00
Explanation:
Total fixed overhead costs = $11,000.00
Variable overhead cost at 11,000 units of production
=Total overheads - Fixed overheads
=$33,000 -$11,000 = $22,000
Variable cost per unit = [tex]\frac{22000}{11000}[/tex] = $2 per unit
When production increased to 13,000 units then overheads costs will be
Fixed Costs = $11,000 Remains constant up to certain activity level, here 13,000 units is acceptable level
Variable costs = 13,000 units X $2 per unit = $26,000
Total Overhead costs = Fixed + Variable
= $11,000 + $26,000 = $37,000
Total = $37,000
A basket of goods for a given consumer includes two goods, X and Z. Consumer income is equal to $1,500 and the prices of these two goods are as follows: Px = $50 Pz = $50 This consumer is consuming 10 units of good X. Suppose that over the course of a year, the price of good X changes by -20% and the price of good Z changes by 25%.
How much income would be required for the consumer to afford the same quantity of goods X and Z with the new prices?
What is the rate of inflation?
Given this change in prices, is it possible for our consumer to buy the original bundle of goods?
Answer:
Costumer will need $1650 to afford the same quantity of goods
Rate of inflation=2.5%
Is not possible for our consumer to buy the original bundle of goods
Explanation:
Income = $1,500
First year Px = $50
Pz = $50
10 units of good X is 50x10=500,
Consumer could buy $1000 in product Z (Income-cost of product Z=1500-500)
qz=Product Z is $50 each so customer could buy 20 units(1000/50).
Prices of Second year
Px' = $50*(1-0.20)=40
Pz' = $50*(1+0.25)=62.5
Cost=Px'*qx+Pz'*qz=40*10+62.5*20=400+1250=1650
Costumer will need $1650 to afford the same quantity of goods
Rate of inflation=
RI=(sum price of x and z in second year-sum price of x and z in first year)/100
RI=(40+62.5)-(50+50)/100=102.5-100/100= 2.5/100=0.025=
RI=2.5%
Is not possible for our consumer to buy the original bundle of goods with the same budget
Final answer:
After the price changes, the consumer requires $1,025 to purchase the same quantity of goods X and Z, which is less than the original income of $1,500. Therefore, it is possible for the consumer to afford the original bundle of goods.
Explanation:
The question involves a consumer whose income and the prices of two goods, X and Z, change over a given period. Initially, both goods are priced at $50 each, and the consumer can buy 10 units of good X with a total income of $1,500. Over the course of a year, the price of good X drops by 20%, making its new price $40 ($50 - 20% of $50), and the price of good Z increases by 25%, making its new price $62.50 ($50 + 25% of $50). To calculate the income required for the consumer to afford the same quantity of goods X and Z with the new prices, we multiply the new prices by 10 units (since the original quantity purchased is 10 units for X and assuming the same for Z for simplicity): 10 units * $40 for X = $400 and 10 units * $62.50 for Z = $625, totalling $1,025. Therefore, the consumer now requires an income of $1,025 to afford the same quantity of goods at the new prices. The rate of inflation is a measure of the overall increase in prices over a given period. While this example does not provide sufficient data to calculate a broad rate of inflation, the significant price change in goods X and Z demonstrates individual price inflation and deflation respectively. Given the new prices, it is indeed possible for our consumer to buy the original bundle of goods due to the decreased price of X, despite the increased price of Z, especially since the total new required income ($1,025) is less than the original income ($1,500).
Tom’s Electrical had the following information: Total Assets, December 31, 2016 $160,000 Total Assets, December 31, 2017 170,000 For Year Ended December 31, 2017: Interest Expense 2,000 Net Income 48,000 What is the rate of return on total assets?
Answer:
ROA = 30.3030%
Explanation:
ROA = operating income / average assets
were average assets = ( beginning assets + ending assets ) / 2
operating income = net income + interest expense
= 48,000 + 2,000 = 50,000 income generate by assets
average assets = (160,000 + 170,000) / 2 = 165,000
ROA = 50,000 / 165,000 = 0.303030 = 30.3030%
Remember:
If you are given with the net income value and the list of expenses, look out for interest expenses, because those are generate by the liabilities ofthe company, so to clean up the income we add them to the net income to show the ammount generate by assets
The rate of return on total assets for Tom's Electrical for the year ended December 31, 2017, is calculated by dividing the net income by the average total assets for the period. The rate of return is approximately 29.1%.
Explanation:The rate of return on total assets can be calculated using the formula:
Return on Assets (ROA) = Net Income / Average Total Assets
We calculate the Average Total Assets by adding the Total Assets at the beginning of the period to the Total Assets at the end of the period and dividing by 2:
Average Total Assets = (Total Assets 2016 + Total Assets 2017)/2 = ($160,000 + $170,000)/2 = $165,000
Then we can calculate the ROA:
ROA = Net Income / Average Total Assets = $48,000 / $165,000 = 0.291
Therefore, the rate of return on total assets for Tom's Electrical for the year ended December 31, 2017, is approximately 29.1%.
Learn more about Return on Assets here:https://brainly.com/question/31080458
#SPJ3