Answer:
controllable margin = $100,000
Explanation:
given data
Income tax expense = $62000
Contribution margin = 180000
fixed costs = 80000
Interest expense = 68000
Total operating assets = 40000
to find out
How much is controllable margin
solution
we get here controllable margin that is express as
controllable margin = contribution - controllable fixed cost ....................1
put here value we get
controllable margin = 180000 - 80000
controllable margin = $100,000
The controllable margin for Bramble Corp. for the year 2016 is calculated by deducting the controllable fixed costs from the contribution margin. Upon calculation, it comes out to be $100,000, which measures the efficiency of the company.
Explanation:The controllable margin for Bramble Corp. can be calculated using the formula: Controllable Margin = Contribution Margin - Controllable Fixed Costs. The contribution margin is the difference between the company's total sales and its total variable costs. The controllable fixed costs are the overhead expenses that management has control over and can alter.
So, in the case of Bramble Corp., their contribution margin for 2016 was $180,000, and their controllable fixed costs were $80,000. Therefore, we subtract the controllable fixed costs from the contribution margin:
Controllable Margin = $180,000 - $80,000 = $100,000
Therefore, the controllable margin for Bramble Corp. for the year 2016 was $100,000. This depicts the profitability of the company after accounting for both variable and controllable fixed costs and it is one of the vital metrics to measure the efficiency of a company.
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E21-6 (L04) EXCEL (Lessor Entries; Sales-Type Lease) Crosley Company, a machinery dealer, leased a machine to Dexter Corporation on January 1, 2017. The lease is for an 8-year period and requires equal annual payments of $35,013 at the beginning of each year. The first payment is received on January 1, 2017. Crosley had purchased the machine during 2016 for $160,000. Collectibility of lease payments is reasonably predictable, and no important uncertainties surround the amount of costs yet to be incurred by Crosley. Crosley set the annual rental to ensure an 11% rate of return. The machine has an economic life of 10 years with no residual value and reverts to Crosley at the termination of the lease.
Answer:
all transaciton made at the moment the lease begins.
lease receivables 200,001.13 debit
sales revenues 200,001.13 credit
cost of good sold 160,000 debit
inventory 160,000 credit
cash 35,013 debit
lease receivables 35,013 credit
Explanation:
Present value of the lease payments
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
C 35,013.00
time 8
rate 0.11
[tex]35013 \times \frac{1-(1+0.11)^{-8} }{0.11} = PV\\[/tex]
PV $200,001.1278
The company will delcare this interest receivables and recognize the sales reveneue
It will also recognize the cost of good sold and decrease in inventory (it is equipment for the lessee but inventory for the lessor)
Then for each payment will recognzie a portion of interest revenue and decrease the lease receivables As the payment is at the beginning there is not interest revenue
13. Jensen and Associates has a projected balance sheet that includes the following accounts. What is the projected marketable securities balance? Cash $ 225,000 Marketable securities ? Accounts receivable 680,000 Inventory 940,000 Non-current assets, net 1,420,000 Current liabilities 375,000 Total liabilities 1,060,000 Total equity 2,985,000
Answer:
$780,000
Explanation:
In the balance sheet, the assets, liabilities, and stockholder equity is recorded. In this the accounting equation is used which is shown below:
Total assets = Total liabilities + stockholder equity
= $1,060,000 + $2,985,000
= $4,045,000
And, the total assets would equal to
Total assets = Cash + Marketable securities +Accounts receivable + Inventory + Non-current assets, net
$4,045,000 = $3,265,000 + Marketable securities
So, the marketable securities would be
= $4,045,000 - $3,265,000
= $780,000
The informal communication network, or grapevine:
a. is moderately important, depending on what is happening within the organization and leadership.
b. is not important because it is unplanned and may involve rumors, untruths, and trivial topics.
c. is extremely important because it is widespread and carries information very quickly.
Answer: Option A
Explanation: In simple words, informal communication network refers to the line of communication which is not established by the management. This line is established by the employees within and does not work on specified rules and procedures.
They are moderately important as it helps to spread the information quickly and keeps the morale and satisfaction of the individuals high, But management has to keep control on it as it could be a source of rumors affecting the reputation of the business .
The informal communication network, or grapevine, is an essential part of the informal organization within a company, carrying information quickly and influencing organizational culture. It serves both as a source of social exchange and insight into management actions, despite sometimes carrying gossip. Managers and employees alike can leverage and navigate this network for beneficial outcomes in the workplace.
Explanation:The informal communication network, or grapevine, is a crucial aspect of organizational communication. Contrary to being merely a source of rumors and trivial matters, it is an essential channel through which information flows swiftly among members of an organization. The grapevine is part of the informal organization structure, which is characterized by a dynamic set of personal relationships, social networks, and communities of common interest. Through these networks, information about management actions and changes within the company often circulates rapidly, providing insight that may not be available through formal communication channels.
Moreover, the grapevine can serve as a critical source of social exchange and has a significant impact on the morale and camaraderie among employees. While it may at times carry gossip or unverified information, astute managers leverage the grapevine to informally communicate important news, understand employee sentiments, and indirectly gauge the reaction to potential changes. The strength of informal networks often plays a pivotal role in the organizational culture and can impact decision-making processes and outcomes within the company.
However, individuals should strive to share information on a need-to-know basis, get to know their peers, and avoid engaging in negative gossip or spreading rumors that might harm the workplace environment. Ultimately, understanding and navigating the informal networks can be beneficial for career development and fostering a positive workplace culture.
Windhoek Mines, Ltd., of Namibia, is contemplating the purchase of equipment to exploit a mineral deposit on land to which the company has mineral rights. An engineering and cost analysis has been made, and it is expected that the following cash flows would be associated with opening and operating a mine in the area: Cost of new equipment and timbers $ 490,000 Working capital required $ 175,000 Annual net cash receipts $ 190,000 * Cost to construct new roads in year three $ 55,000 Salvage value of equipment in four years $ 80,000 *Receipts from sales of ore, less out-of-pocket costs for salaries, utilities, insurance, and so forth. The mineral deposit would be exhausted after four years of mining. At that point, the working capital would be released for reinvestment elsewhere. The company’s required rate of return is 19%. a. Determine the net present value of the proposed mining project.
Answer:
Windhoek is located at 22 S, 17 E
.........
Explanation:
The net present value (NPV) of the proposed mining project is approximately $15,908.70.
Explanation:To calculate the net present value (NPV) of the mining project, we need to calculate the present value of each cash flow and then subtract the initial investment cost. The formula for NPV is: NPV = (CF1 / (1 + r)1) + (CF2 / (1 + r)2) + ... + (CFn / (1 + r)n) - Initial Investment
In this case, the cash flows are the annual net cash receipts, the cost to construct new roads in year three, and the salvage value of the equipment in four years. The initial investment includes the cost of new equipment and working capital required. The discount rate or required rate of return is 19%.
By plugging in the numbers into the formula and performing the calculations, we find that the NPV of the proposed mining project is approximately $15,908.70.
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On January 1, 2016, Martini, Inc. acquired a machine for $1,030,000. The estimated useful life of the asset is five years. Residual value at the end of five years is estimated to be $87,000. What is the book value of the machine at the end of 2017 if the company uses the straight-line method of depreciation?
Answer: $652,800
Explanation:
Straight Line Depreciation per year = (Cost – Residual Value) / Useful Life
Straight Line Depreciation per year = ($1,030,000 - $87,000) / 5
Straight Line Depreciation per year = $188,600
Accumulated Depreciation at the end of 2017 = Depreciation per year * No. of years used
Accumulated Depreciation at the end of 2017 = $188,600 * 2
Accumulated Depreciation at the end of 2017 = $377,200
Book Value at the end of 2017 = Cost – Accumulated Depreciation at the end of 2017
Book Value at the end of 2017 = $1,030,000 - $377,200
Book Value at the end of 2017 = $652,800
Final answer:
The book value of the machine at the end of 2017, using the straight-line method of depreciation, is calculated to be $652,800 after taking into account the total depreciation over two years.
Explanation:
The question asks for the book value of a machine at the end of 2017 if the company uses the straight-line method of depreciation. The initial cost of the machine is $1,030,000, with an estimated residual value of $87,000 at the end of its five-year useful life. To calculate depreciation using the straight-line method, subtract the residual value from the cost and then divide by the useful life. So, depreciation per year = ($1,030,000 - $87,000) / 5 = $188,600. By the end of 2017, which is two years from the acquisition date, the total depreciation would be $188,600 * 2 = $377,200. The book value of the machine at the end of 2017 is then the cost minus the accumulated depreciation, which equals $1,030,000 - $377,200 = $652,800.
With a plan for Caffè Gustoso's website in place, you turn your attention to online advertising. Although the choices seem endless, Caffè Gustoso's small budget requires that you limit your spending as much as possible. You narrow your list down to your top three online advertising choices: search advertising, online display (banner) ads, and website sponsorship. Which form of online advertising would be most useful for driving traffic to Caffè Gustoso's new locations?
Answer:
Online displays (banner) ads
Explanation:
This has the potential to appear to any website user in an unsolicited manner
Which of the following statements concerning ideal standards is incorrect?
Group of answer choices
A. Ideal standards generally do not provide the best motivation for workers
B. Ideal standards do not make allowances for waste, spoilage, and machine breakdowns
C. Ideal standards are better suited for cash budgeting than practical standards
D. Ideal standards may be better than practical standards when managers seek continual improvement
Answer:
C. Ideal standards are better suited for cash budgeting than practical standards
Explanation:
The standards that basically handles no work interruptions or no machine breakdown is called ideal standards.
A single individual has an adjusted gross income of $15,000, no tax-exempt interest, and Social Security benefits of $14,000. How much of this individual’s Social Security benefits is subject to income tax? $0. $7,500. $11,900. $15,500.
Answer:
$0
Explanation:
The social security Benefits are taxable only if the MAGI and half of the Adjusted Gross Income exceeds $25,000, in case of a single individual.
Modified Adjusted Gross Income (MAGI) includes all the wages, interest or any other taxable income. Also the tax exempt interest income is also included in such income.
Thus, MAGI here = $15,000
Further one half of the Social Security Benefits = $14,000/2 = $7,000
Jointly MAGI + One half of Social Security Benefits = $15,000 + $7,000 = $22,000
Since it is below $25,000, no social security benefit shall be taxable in the hands of individual.
Renata McCarter, an outside sales representative for Alinda Publications, receives 7 percent commission on all new magazine subscriptions she sells in her sales territory. During the week of March 27, she sold $6,500 of new subscriptions and worked 40 hours.
Required:
What is her gross pay?
Is she subject to minimum wage laws?
Answer:
Gross pay - $455
No
Explanation:
The computation of the gross pay is shown below:
= New subscription sold × commission percentage
= $6,500 × 7%
= $455
Since Renata McCarter is an outside sales representative so she is exempt from the minimum wage laws. Hence, not taxable.
For computing the gross pay, we simply multiply the new subscription sold with the commission percentage so that the accurate amount can come.
The Princeville Company placed five (5) orders for Product 12B from Brookston Corporation. Brookston has the following information about Product 12B: Activity Cost Pools Activity Rate Product 12B Activity Machine Setups $ 12.00 per Machine hour 40 MHs Customer Orders $ 10.00 per Order 5 Orders What is the overhead cost assigned to Princeville for their five (5) orders of Product 12B?
A. $480
B. $530
C. $2,650
D. $990
Answer:
B. $530
Explanation:
Please see attachment
Final answer:
The total overhead cost for Princeville's five orders of Product 12B is calculated by adding the costs of Machine Setups and Customer Orders, which amounts to $530. This is found by multiplying activity rates with the respective activities required and then summing them up. The correct option is b.
Explanation:
The overhead cost assigned to Princeville for their five (5) orders of Product 12B from Brookston Corporation can be calculated using the information about activity cost pools and activity rates. We have two types of costs to consider: Machine Setups and Customer Orders.
Machine Setups cost is $12.00 per machine hour, and for Product 12B, 40 machine hours (MHs) are required. Therefore, the total Machine Setups cost is 40 MHs times $12.00/MH, which equals $480.
Customer Orders cost is $10.00 per order, and since there were 5 orders, the total cost for this activity is 5 orders times $10.00/order, which equals $50.
Add the two costs together to get the total overhead cost for Princeville: $480 (Machine Setups) + $50 (Customer Orders) = $530.
Therefore, the correct answer is B. $530.
If the expected proportionate change in the nominal exchange rate, measured in units of domestic currency per unit of foreign currency, is 2 % and the domestic interest rate is 6 %, then according to the uncovered interest parity condition, the foreign interest rate should be equal to:
Select one:
a. 6 % - 2 % = 4 %
b. 6 % + 2 % = 8 %
c. 6 % ÷ 2 % = 3 %
d. 6 % x 2 % = 12 %
Answer:
a. 6 % - 2 % = 4 %
Explanation:
Uncovered interest parity condition is that expected change in nominal interest rate equals difference between the interest rates.
domestic interest rate - foreign interest rate = expected change in nominal interest rate .
6 percent - foreign interest rate = 2 percent
So, foreign interest rate = 6 percent - 2 percent = 4 percent
A firm that has total fixed costs of $20,000 sells its output for $150 per unit and has an average variable cost of $200. If the firm's cost and revenue curves are linear, how much output must the firm produce to break even?
(A) The firm cannot break even.
(B) 300
(C) 500
(D) 400
Answer:
A) the firm cannot breakeven.
Explanation:
Break even point is the point where the company make neither a loss nor profit (i.e. a point where profit is zero).
Break even is computed as Totatl fixed cost/Contribution Margin (ratio).
Contribution margin can be calculated as Sales - Variable Cost (Note that this can be calculated per unit or in total).
In this scenario, the contribution per unit = $150-$200 = -$50 (This means that on every one unit, the company is making a loss contribution margin.
And since the revenue and cost curve is linear (i.e. on a straight line) the loss contribution will continously be made. Hence the company can never break even.
Do It! Review 9-1 Pharoah Company purchased a delivery truck. The total cash payment was $43,222, including the following items. Negotiated purchase price $34,200 Installation of special shelving 2,810 Painting and lettering 830 Motor vehicle license 260 Annual insurance policy 3,070 Sales tax 2,052 Total paid $43,222 Calculate the cost of the delivery truck. The cost of the delivery truck $enter the cost of the delivery truck in dollars.
Answer:
$39,892
Explanation:
The computation of the cost of the truck is shown below:
= Negotiated purchase price of the delivery truck + Installation cost of special shelving + Painting and lettering cost + Sales tax
= $34,200 + $2,810 + $830 + $2,052
= $39,892
The motor vehicle license and the annual insurance policy is an annual cost expense which is not considered for computing the cost of the delivery truck. Hence, ignored it
The Zabel Company uses the periodic inventory system. Kelly Zabel, the CEO, believes that the ending inventory for 12/31/12 is understated by $12,000. Indicate whether the following statement relating to the above error is true or false. Net Income will be overstated in 2013 by $12,000. True or False
Answer:
Yes
Explanation:
A a lower opening inventory leads to a lower cost of sales, hence a higher net income while a lower closing inventory leads to a higher cost of sales and hence a lower net income.
Suppose that a labor economist claims that recipients of economics PhDs gain little in terms of acquired productive skills from their graduate studies but that, instead, the degree simply reflects a high level of inherent mathematical ability. Which one of the following characterizes the labor economist's perspective on the link between education and wages? Compensating differentials Signaling The superstar phenomenon O Human capital A famous rapper has earned enormous sums of money by supplying creative music to millions of fans. Which of the following statements characterize this market in which some earn astronomical incomes, while others (who may have similar talent) earn very little? Check all chat Technology allows for supplying all customers at low cost. Nearly all customers in the market desire the good supplied by the superstar. Because of technology, his music is essentially a public good. The best recording artists earn dramatically more than good or mediocre artists. Customers in this type of market prefer having twice as much of a good from a recording artist half as talented as the superstar.
Answer
The answer and procedures of the exercise are attached in a the following image.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.
This question compares the effects of a tax cut on aggregate demand and aggregate supply. A tax cut of 150 is targeted to business enterprises so that, as their after-tax profits rise, they raise their spending on investment goods by the full 150. When subsequent rounds of increases in income occur, however, there is a normal marginal propensity to consume, and a multiplier of two. Investment has the following effect on aggregate supply: for every $3 of investment goods produced, annual output rises by $1.a) What increase in aggregate demand will result from this tax cut?b) What increase in aggregate supply will occur in the first year?c) Comparing your answers in a) and b), which impact is bigger?d) Assuming the tax reduction is permanent, how many years will it take before the effects on aggregate demand and aggregate supply are equal?e) Suppose the tax cut is not quite as well targeted toward the supply side as the government hoped. Of the cut of 150, initially 60 is spent on investment, 60 is spent on consumption, and 30 is saved. Answer questions a) through d) above under these circumstances.
Answer:
Check the following explanation.
Explanation:
Ans a - Aggregate demand will increase by $150.
Ans b - Aggregate supply will increase by $50 in the first year.
Ans c - The aggregate demand impact is bigger.
Ans d - If the tax reduction is permanent then the aggregate demand and aggregate supply will be equal in 3 years.
Ans e - The aggregate demand increases by 120. The aggregate supply increases by 20. The aggregate demand impact is bigger. If the tax reduction is permanent then the aggregate demand and aggregate supply will be equal in 6 years.
Wilson Co. produces sports equipment and is currently producing 2,000 tennis rackets annually. A supplier has offered to produce the rackets for Wilson Co. for $370 per racket. Wilson incurs unit-level costs of $360 per unit. Wilson also spends $10,000 on product design each year and incurs $100,000 of facility-level costs. Based on your quantitative analysis, should Wilson Co. outsource the rackets? What is the effect on profit?
Answer:
Yes, Wilson Company shall outsource the rackets.
Effect on profit is that the profit will increase by the net cost avoided = $830,000 - $740,000 = $90,000
Explanation:
As for the information provided:
We will do a comparative analysis, of current situation and that of the offer given by supplier.
Total current cost in case of manufacturing:
Cost of production = $360 [tex]\times[/tex] 2,000 = $720,000
Cost of product design = $10,000
Facility level cost = $100,000
These all cost are avoidable in case of buying from supplier. Thus, total avoidable cost = $830,000
Total cost associated in case of buying the sports equipment from supplier shall be: $370 [tex]\times[/tex] 2,000 = $740,000
Since, the cost in case of buying is less, the tennis rackets shall be bought from supplier.
The Buckeye Corporation expects to pay a dividend of $3.15 per share at the end of next year. The firm expects the dividend to continue growing at the rate of 8% per year for the foreseeable future. If you require a return of 13% per year, the most you should pay for this stock is ______?
Answer:
Answer is $63.
Explanation:
Price = D1/(ke- g) = 3.15/(.13 - .08) = $63
Answer is $63.
O’Dell Vegetables purchased a harvesting machine on July 1, 2016, for $984,000. The machine was estimated to have a useful life of 8 years with an estimated salvage value of $140,000. O’Dell uses the straight-line method of depreciation. During 2019, it became apparent that the machine would become uneconomical after December 31, 2023, and that the machine would have no scrap value. What should be the charge for depreciation in 2019 under generally accepted accounting principles?
Answer:
Depreciation expense in 2019 is $144,050
Explanation:
O’Dell Vegetables uses the straight-line method of depreciation, Depreciation Expense each year is calculated by following formula:
Depreciation Expense = (Cost of machine − Salvage Value )/Useful Life
From July 1, 2016 to 2018:
Annual Depreciation Expense = ($984,000 - $140,000)/8 = $105,500
Depreciation Expense in 2016 = $105,500x6/12 = $52,750
Accumulated Depreciation (end 2018) = $52,750 + $105,500 + $105,500 = $263,750
From 2019, the machine would become uneconomical after December 31, 2023:
Salvage Value = 0 and Remaining useful life = 5 year
Depreciation Expense = (Historical Cost - Accumulated Depreciation - Salvage Value) / Remaining Useful Life = ($984,000-$263,750-0)/5 = $144,050
Depreciation in 2019 is $144,050
Vaughn Manufacturing had average operating assets of $5000000 and sales of $2500000 in 2016. If the controllable margin was $450000, the ROI was
50%
41%
9%
18%
Answer:
9%
Explanation:
The Return on Investment (ROI) is used to directly measure the amount of return, relative to the cost of the investment. It can be calculated by dividing the controllable margin by the company's average operating assets.
[tex]ROI = \frac{\$450000}{\$5000000} \\ROI =0.09[/tex]
Therefore, the return on investment for Vaughn Manufacturing was 0.09 or 9%.
A manager receives a forecast for next year. Demand is projected to be 590 units for the first half of the year and 940 units for the second half. The monthly holding cost is $2 per unit, and it costs an estimated $55 to process an order.
a. Assuming that monthly demand will be level during each of the six-month periods covered by the forecast (e.g., 100 per month for each of the first six months), determine an order size that will minimize the sum of ordering and carrying costs for each of the six-month periods. (Round your answers to the nearest whole number.)
Answer:
74 units; 93 units
Explanation:
Given that,
Holding cost, H = $2 per unit
Carrying cost, O = $55
Demand in first half, D1 = 590 units
= 590 ÷ 6
= 98.33 per month
Demand in second half, D2 = 940 units
= 940 ÷ 6
= 156.67 per month
For D1; EOQ:
[tex]EOQ=\sqrt{\frac{2\times D\times O}{H} }[/tex]
[tex]EOQ=\sqrt{\frac{2\times 98.33\times 55}{2} }[/tex]
= 73.54 or 74 units
For D2; EOQ:
[tex]EOQ=\sqrt{\frac{2\times D\times O}{H} }[/tex]
[tex]EOQ=\sqrt{\frac{2\times 156.67\times 55}{2} }[/tex]
= 92.82 or 93 units
Hence, the appropriate order size will be 74 units and 93 units.
Henry Crouch's law office has traditionally ordered ink refills 70 units at a time. The firm estimates that carrying cost is 40% of the $11 unit cost and that annual demand is about 245 units per year. The assumptions of the basic EOQ model are thought to apply. For what value of ordering cost would its action be optimal? a) For what value of ordering cost would its action be optimal? Its action would be optimal given an ordering cost of $ nothing per order (round your response to two decimal places). b) If the true ordering cost turns out to be much less than your answer to part (a), what is the impact on the firm's ordering policy?
The EOQ model is used to find the optimal order quantity that minimizes total inventory costs. By substituting the known values into the EOQ equation, we can find the optimal ordering cost. If the actual ordering cost is less, the firm should order frequently in smaller quantities to lessen total inventory costs.
Explanation:The Economic Order Quantity (EOQ) model can be used to determine the optimal order quantity that minimizes total inventory costs. The EOQ formula is: EOQ = √((2DS)/H) where D is the demand rate, S is the ordering cost (optimal value that we need to find), and H is the annual holding and storage cost per unit.
In your case, D = 245 units, H = $4.4 (40% of the $11 unit cost). Substituting the known values into the equation, we get: 70 = √((2*245*S)/4.4). By solving for S, we find the optimal ordering cost that makes ordering 70 units at a time the best strategy.
If the actual ordering cost is less than this calculated optimal cost, the firm can benefit from ordering more frequently in smaller quantities. It will reduce total inventory costs because lesser capital will be tied up in inventory, reducing holding costs.
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The EOQ model suggests an optimal order size for minimizing inventory costs considering the ordering cost, demand rate and holding costs. If the cost of placing orders is significantly lower than estimated, the firm could adjust its ordering policy to order more frequently in smaller batches to reduce carrying costs.
Explanation:The Economic Order Quantity (EOQ) model can be helpful in determining the volume and frequency of orders a firm should make to minimize its inventory costs. The model dictates that the optimal order size, given the assumptions of constant demand, constant lead time and no stockouts, will result in the lowest total inventory cost.
The EOQ is calculated as Square Root of (2DS/H) where:
D represents demand in units (given as 245 units per year)S is the setup costs or ordering costs (unknown in this scenario)H is the holding costs per unit, per year (calculated as 40% of the $11 unit cost)The firm traditionally orders 70 units. If this is indeed the optimal order size, the ordering cost, S, can be found by rearranging the EOQ formula to solve for S and substituting the provided values into the formula.
If the true ordering cost turns out to be much less than estimated, the firm may find it optimal to order in smaller, more frequent batches to minimize holding costs. The lower ordering costs would mean frequent orders would not be as costly, and thus, the firm might keep less stock on hand at any given time, reducing their carrying costs.
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On January 1, 2018, Purdy Company enters into a contract to transfer Blue and Rain to Georgia Co. for $300,000. The contract specifies that payment for Blue will not occur until Rain is also delivered. In other words, payment will not occur until both Blue and Rain are transferred to Georgia. Purdy determines that standalone prices are $110,000 for Blue and $190,000 for Rain. Purdy delivers Blue to Georgia on February 10, 2018. On March 15, 2018, Purdy delivers Rain to Georgia. Purdy should record...(a)Accounts Receivable of $300,000 on January 1.(b)Accounts Receivable of $110,000 on February 10.(c)Contract Asset of $110,000 on February 10.(d)Contract Asset of $110,000 on January 1.
Purdy recognizes revenue under IFRS 15 upon transferring control of Blue to Georgia, creating a Contract Asset of $110,000 on February 10. Revenue for Rain will be recognized upon delivery. Here option C is correct.
The revenue recognition principle under IFRS 15 requires revenue to be recognized when control of the goods or services is transferred to the customer. In this case, Purdy Company enters into a contract to transfer both Blue and Rain to Georgia Co. for $300,000, but payment for Blue will not occur until Rain is also delivered.
On February 10, 2018, Purdy delivers Blue to Georgia. Since Blue has been transferred, Purdy should recognize revenue for Blue, which has a standalone price of $110,000. However, payment has not yet occurred, and Rain is still pending delivery.
Therefore, Purdy should recognize a Contract Asset of $110,000 on February 10, reflecting the portion of the contract price attributable to the transferred goods (Blue) for which payment is still pending. The remaining portion related to Rain will be recognized when Rain is delivered. Here option C is correct.
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The Absolute Zero Co. just issued a dividend of $3.40 per share on its common stock. The company is expected to maintain a constant 4.5 percent growth rate in its dividends indefinitely.
If the stock sells for $53 a share, what is the company’s cost of equity?
The cost of equity for the Absolute Zero Co., calculated using the Gordon Growth Model and given a constant growth rate of 4.5% in dividends, is 6.4%.
Explanation:The cost of equity for the Absolute Zero Co. can be calculated using the Gordon Growth Model, which is used to determine the value of a stock that pays dividends. The formula for this model is D1 / (k - g), where D1 is the dividend in the next period, k is the cost of equity, and g is the growth rate of dividends.
In this case, the dividend (D1) at the next time period would be $3.40 * 1.045 ($3.55), given that the dividends are expected to grow at a constant rate of 4.5%. The cost of equity (k) can thus be found by rearranging the formula to: k = D1/P0 + g = $3.40/$53 + 0.045 = 0.064 or 6.4%.
So, the cost of equity for the Absolute Zero Co. is 6.4%.
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At a minimum, the sales forecast for the coming year would reflect A. the influence of any anticipated events that might materially affect the sales trend. B. any future trend in sales that is expected to begin in the new year. C. Both of the above are correct. D. Neither of the above is correct.
Answer:
C. Both of "A" and "B" above are correct.
Explanation:
A sales forecast is an estimation of future revenue to be generated from sales that can be obtained by studying past data and trends, and analysing the market. A prediction of what sales will look like within a specified period of time in future, is then made.
In sales forecasting, anticipated events that may affect sales as well as predicted future sales trend in the coming year, are taken into consideration and are reflected in the sales forecast for the coming year.
Changes to the marketing communications model include that consumers are changing and are better informed, that marketing strategies are changing and are moving from mass marketing, and that ________.
A) manufacturing processes are becoming more efficient
B) distribution of products worldwide is more feasible and cost-effective
C) segmenting and targeting of consumers are more detailed than ever before
D) digital technologies are changing the ways companies and customers communicate
E) retailing is more competitive with more sources of products available for consumers
Answer:
The answer to the question would be D
Explanation:
The world of marketing is walking in an accelerated way as I had not imagined, barely and is finishing to internalize in each of the strategies, tactics and tools of digital marketing, but the new social networks, technology and instruments makes everything have You go almost at the speed of light. However, it is a positive aspect that helps us make marketing strategies more effective, creative, different and of course, also measurable and profitable.
As technology has advanced, effective, efficient and economical tools have emerged that companies can use to make processes faster and more quality; one of them is marketing automation
Digital marketing strategies have become an important axis for companies, although some are still afraid to bet on them. However, creating an effective digital marketing strategy is not an easy task, you have to know very well how to plan it, execute it and follow it up to make the corrections along the way and thus improve, to take the company to the top of success .
For businesses, one of the biggest impacts has been the access to information about customers and consumers. While this obvious advantage is available to many, the most successful companies are those that use this information to deliver superior customer value.
Businesses have changed dramatically in the last decade, and the most significant catalyst has been the impact of computer technology on the everyday lives of organizations and individuals. Information and communications technology, has facilitated information processing.
Developments in computer technology have also allowed companies with large customer bases to provide a superior level of individualized service and to customize their product or service offering to suit the customer.
It is estimated that consumers are bombarded with up to 3000 communications and messages every day, and as a result they have become much more discerning as to which ones they listen to, never mind respond to.
Colt Company owns a machine that can produce two specialized products. Production time for Product TLX is three units per hour and for Product MTV is four units per hour. The machine’s capacity is 2,100 hours per year. Both products are sold to a single customer who has agreed to buy all of the company’s output up to a maximum of 3,570 units of Product TLX and 4,000 units of Product MTV. Selling prices and variable costs per unit to produce the products follow. $s per unit Product TLX Product MTV Selling price per unit $ 12.50 $ 7.50 Variable costs per unit 3.75 4.50 Determine the company's most profitable sales mix and the contribution margin that results from that sales mix. (Round cost per unit answers to 2 decimal places.)
The sales mix that the corporation finds to be the most lucrative has a contribution margin of $13,412.5. Understanding profit margin, which is calculated as the product's profit divided by the sale price, is the key to understanding the sales mix. In order to understand your sales mix, you can then compare the profit margins of various goods.
Given
Maximum units of Product TLX = 3,570 units
Maximum units of Product MTV = 4,000 units
Machine capacity = 2,100 hours per year
Production time for Product TLX = 3 units per hour
Production time for Product MTV = 4 units per hour
Required to calculate the most profitable sales mix and the contribution margin that results from that sales mix =?
Product TLX Product MTV
Selling Price $12.50 $7.50
Variable Cost $3.75 $5
Contribution $8.75 $3.00
Unit Per hour 3 4
Max. Unit 3570 4000 Total
Max.Hour Req. 1190 1000 2190
Profitable Sale mix (Units)1190 910 2100
Contribution margin $8.75 $3.00
Total Cont. Margin $10,412.50 $2,730.00 $13,142.50
Therefore, the company's most profitable sales mix and the contribution margin that results from that sales mix is $13,412.5.
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Final answer:
The most profitable sales mix for Colt Company involves prioritizing the production of Product TLX, which has a higher contribution margin ($8.75 per unit) than Product MTV ($3.00 per unit), up to the customer's maximum purchase quantity followed by producing Product MTV with any remaining capacity.
Explanation:
Most Profitable Sales Mix and Contribution Margin Calculation
To determine the most profitable sales mix for Colt Company, we need to compare the contribution margins of Product TLX and Product MTV. The contribution margin per unit is calculated by subtracting the variable cost per unit from the selling price per unit. For Product TLX, the contribution margin is $12.50 - $3.75 = $8.75 per unit. For Product MTV, the contribution margin is $7.50 - $4.50 = $3.00 per unit.
Given that the machine has a capacity of 2,100 hours per year, we can calculate the maximum production for both products while respecting the customer's maximum purchase quantities. For Product TLX: 2,100 hours/year * 3 units/hour = 6,300 units. For Product MTV: 2,100 hours/year * 4 units/hour = 8,400 units.
To maximize profits, Colt Company should prioritize production of the product with the higher contribution margin, which is Product TLX. However, the customer will only buy up to 3,570 units of Product TLX. Once this quantity is reached, the company should use the remaining machine capacity to produce Product MTV. We can calculate the total contribution margin by multiplying the units sold by their respective contribution margins and adding them together. This yields the most profitable sales mix while respecting the customer's limits and machine capacity.
The exact numbers for the most profitable mix and resulted contribution margin will vary based on how many hours are allocated to each product's production, with the guiding principle being to utilize all available hours while respecting the demand ceiling for both products.
A bakery sells 6 different varieties of cupcakes (chocolate, vanilla, red velvet, etc.). How many ways are there to fill a box with 24 cupcakes from the 6 varieties? The order in which the cupcakes are selected is unimportant; all that matters is the number of each variety in the box after they are chosen.
Answer:
118755
Explanation:
Here let x1, x2, x3……, x6 are number of cupcakes from each variety;
Therefore x1+x2+x3+x4+x5+x6 =24
Since the order in which the cupcakes are selected is unimportant we have the following;
Number of non-negative solution of above equation =24+6-1C6-1 =29C5 =118755
Therefore the correct answer is 118755
Finish Co. uses the allowance method to account for bad debts. At the end of 2010, Finish Co.'s unadjusted trial balance shows an accounts receivable balance of $30,000; allowance for doubtful accounts balance of $200 (credit); and sales of $600,000. Based on history, Finish estimates that bad debts will be 1% of sales. The entry to record estimated bad debts will include a debit to Bad Debts Expense in the amount of:
Answer:
$6000
Explanation:
Because you have to debit the Back Debts account. and 1% of 600,000 is 6000.
600,000 is the amount of sales.
A few questions in this problem set are based on the comments made by James Love to Congress regarding antitrust policy and the Petroleum industry. These are found at the end of the module on Antitrust Policy. Try to read the entire article carefully first... and then see if you can answer the questions (rather than fishing out the answer each time). Obviously you will go back and check to make sure you have it correct ... but to absorb the content it is best read it all first before going back. What is it about the petroleum industry that simultaneoulsy prevents entry and fosters joint ventures and other collaberations
Answer:
High fixed (and sunk) costs
Explanation:
Petroleum industry is marked by high fied and sunk cost as exploration of oil is an expensive business. The companies need to spend a lot of money on technology and machinery and even that does not guarantee success. Hence all these fied cost and sunk cost make the entry of new firm difficult.