Answer:
The measure of occupational prestige is determined through the process in which a nationwide sample of people is asked to evaluate a series of different jobs.
Explanation:
Occupational prestige is also known as job prestige. It is a way used by sociologists to define the social position or standing of people based on their occupation. Rather than using the personal attributes of individuals, it ranks people according to their profession or occupation. The ranks lie from 0 to 100, with 0 being lowest score and 100 the highest. These ranks are alloted to different professions by conducting nationwide surveys.
Final answer:
The measure of occupational prestige is determined by averaging the ratings from a nationwide sample of people asked to evaluate different jobs, reflecting society's esteem for these positions.
Explanation:
The measure of occupational prestige is determined by a nationwide sample of people who are asked to evaluate a series of different jobs. Since the late 1940s, these national surveys have gathered Americans' perceptions on the prestige of dozens of occupations, averaging these ratings to yield prestige scores for those occupations. Jobs like physicians, college professors, and elementary school teachers tend to score high in these evaluations, reflecting the high esteem society holds for these positions. Conversely, jobs such as garbage collectors and janitors typically score lower, indicating less societal esteem. This method underscores the idea that occupational prestige is a key indicator of social class in high-income nations, alongside income, wealth, and education.
P7-9: Common stock value: Constant growth McCracken Roofing Inc. common stock paid a dividend of $1.20 per share last year. The company expects earnings and dividends to grow at a rate of 5% per year for the foreseeable future. a. What required rate of return for this stock would result in a price per share of $28? b. If McCracken expects both earnings and dividends to grow at an annual rate of 10%, what required rate of return would result in a price per share of $28?
Answer:
a) rate of return = 0.095 = 9.5%
b) rate of return = 0.147143 = 14.7143%
Explanation:
a) using the constant growth model:
[tex]P = \frac{D0 (1+g)}{ke - g)}[/tex]
[tex]28=\frac{1.2(1.05)}{ke-0.05} \\[/tex]
therefore[tex]ke =\frac{1.2(1.05)}{28} +0.05[/tex]
[tex]ke = 0.095 =9.5%[/tex]
b) using the working from above, we showed that
[tex]ke=\frac{Do(1+g)}{P0} + g[/tex]
given g= 10%, P0=28 and D0=1.2
[tex]ke = \frac{1.20(1+0.1)}{28} + 0.1 = 0.147142857 = 14.7143%[/tex]
Final answer:
The required rate of return for McCracken Roofing Inc.'s stock with a dividend growth rate of 5% for a price of $28 is approximately 14.29%. With a growth rate of 10%, it's the same since the stock price is held constant at $28.
Explanation:
The student's questions relate to calculating the required rate of return for a stock given its dividend payout and growth rate to result in a specific stock price. The method for this calculation involves using the Gordon Growth Model, which connects the current dividend payment, the growth rate of dividends, and the required rate of return to derive the stock price.
Part a:
The first part of the question asks what required rate of return would result in a price per share of $28 when the stock paid a dividend of $1.20 last year with a growth rate of 5%.
We use the formula:
Price = Dividend per share / (Required rate of return - Growth rate)
Rearranging for the required rate of return gives us:
Required rate of return = (Dividend per share / Price) + Growth rate
With the given numbers:
Required rate of return = ($1.20 / $28) + 0.05
Required rate of return = 0.092857 + 0.05
Required rate of return = 0.142857 or 14.2857%
Part b:
The second part changes the growth rate to 10%. Using the same method:
Required rate of return = ($1.20 / $28) + 0.10
Required rate of return = 0.142857 or 14.2857%
Note: In practice, required rates of return would also consider the risk premium, which accounts for the uncertainty and risk associated with future dividend payments.
The poverty rate in the United States is defined as the proportion of the population that fails to earn a ____ absolute income standard. Poverty rates in the United States have largely ____ since the year 2000.
Answer:
The correct answer is : minimum; risen.
Explanation:
The poverty rate can be defined as the rate of population in a certain age gap who fail to earn a given minimum absolute income.
The census bureau updates the poverty threshold annually. People below this threshold level are considered poor.
According to the data from US census bureau the poverty rate in 2000 was 11.3%. In 2010, it was 15.1%. Though it fell to 13.5% in 2015 it is still higher than that in 2000.
So, we can conclude that poverty rate has increased largely since the year 2000.
Andy invests in Orelon Corp., a plastic manufacturing company. As a stockholder, he owns a part of the company and he holds the right to vote on company issues. However, he is entitled to dividends only when the company's board of directors decides to. According to the company policies, if Orelon Corp. faces dissolution in the future, Andy will receive his assets only after the company satisfies the claim of the preferred stockholders. Based on the given information, it can be concluded that Andy is a _____ stockholder.
Answer:
Andy is a common stockholder
Explanation:
In case of dissolution, the company must pay his creditors in a specific order.
Based on the given information, we can say that Andy is a common stock holder, because they are the last in line for the company's assets . This means that the corporation must pay all creditors and bondholders first, then preferred shareholders and last, common stockholders
Given the facts, Andy is a common stockholder of Orelon Corp. He has voting rights proportional to his ownership, but his dividends and claim on assets are secondary to those of preferred stockholders.
Explanation:Based on the given information, it can be concluded that Andy is a common stockholder in Orelon Corp. Common stockholders, also known as shareholders, are individuals who own shares of stock in a public company, which gives them a partial ownership claim on the company. However, they have less claim on the company's assets and earnings than preferred stockholders.
Common stockholders have the right to vote for the company's board of directors and their votes are usually proportional to the amount of stock they own. The board of directors then hire top executives to run the company on a daily basis. And as Andy only receives dividends when they are approved by the board, and his assets are only returned after the claims of preferred stockholders are satisfied, his status as a common stockholder is confirmed.
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Irving’s Rib Shack is a regional chain of barbecue restaurants. They have a long-standing policy that the recipe for their signature barbecue sauce is not to be made public. What type of intellectual property protection keeps the recipe secret?
Answer:
The correct answer is trade secret
Explanation:
Trade secret can be considered as any secret or confidential information regarding business that provides a company with a competitive advantage over other company's in the market. Trade secret can be anything like commercial secrets, advertising strategies, recipe formula or manufacturing secrets etc. So therefore by reading the question it is quite clear that the intellectual property protection that keeps the recipe a secret is trade secret.
Irving's Rib Shack's recipe for their signature barbecue sauce is protected as a trade secret. This method of intellectual property protection is the same one utilized to keep the Coca-Cola formula private.
Explanation:The intellectual property protection that keeps Irving's Rib Shack's signature barbecue sauce recipe secret is referred to as trade secrets. This body of law grants protection to commercially valuable pieces of information that provide an enterprise a competitive edge, such as the secret recipe for Coca-Cola. In the case of Irving's Rib Shack, they protect their barbecue sauce recipe by not making it public, not through patent or copyright law, but by simply keeping it confidential, which is the nature of a trade secret.
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Suds's Bottling Company does bottling, labeling, and distribution work for several local microbreweries. The demand rate for Wortman's beer is 600 cases (24 bottles each) per week. Suds's bottling production rate is 2 comma 300 cases per week, and the setup cost is $700. The value of inventory is $11.50 per case, and the annual holding cost is 30 percent of the inventory value. Suds's Bottling Company operates 52 weeks per year. What is the economic production lot size?
Answer:
The economic production lot size will be 3,558 cases
Explanation:
We should use the economic order quantity formula
[tex]Q_{opt} = \sqrt{\frac{2DS}{H}}[/tex]
How to Remember:
Demand per year and order cost goes in the dividend.
Holding cost goes in the divisor.
D= annual demand = 600 x 52 = 31,200
S= setup cost = 700
H = Annua holding cost is 30% of invenotry value:
11.50 x 30% = 3.45
[tex]Q_{opt} = \sqrt{\frac{2\times31,200\times700}{3.45}}[/tex]
EOQ =3558
Final answer:
The question involves calculating the economic production lot size for Suds's Bottling Company for Wortman's beer using the EPQ formula, considering various given costs and rates, such as demand rate, production rate, setup cost, value of inventory, and holding cost rate.
Explanation:
The question asks for the calculation of the economic production lot size for Wortman's beer, being produced and distributed by Suds's Bottling Company. To find this, we use the Economic Production Quantity (EPQ) formula, which is designed to determine the most efficient quantity to order that minimizes the total holding costs and setup costs during production. Given that the demand rate is 600 cases per week, the production rate is 2,300 cases per week, the setup cost is $700, the value of inventory is $11.50 per case, and the annual holding cost rate is 30% of the inventory value, we can proceed with the calculation. The EPQ formula is: EPQ = sqrt((2DS/H) * (P/(P-D))), where D = demand rate (600 cases/week), S = setup cost ($700), H = holding cost per unit per year ($11.50 * 30%), and P = production rate (2,300 cases/week). Plugging in these numbers, we calculate the economic production lot size Suds's should aim for to minimize costs while meeting demand efficiently.
Job 593 was recently completed. The following data have been recorded on its job cost sheet: Direct materials $2,472 Direct labor-hours 74 labor-hours Direct labor wage rate $ 19 per labor-hour Machine-hours 134 machine-hours The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $20 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 593 would be:
Answer:
Total Cost Job 593 6557
Explanation:
Job 593
[tex]cost = materials + labor + overhead[/tex]
DM 2,471
DL 1,406 ( 74 labor hours x $19 labor rate)
FO 2,680 (134 machine hours x 20 FO rate)
Total Cost 6557
Remember, for Direct Labor and machien hours, you needto multiply the amount of hour applied in the job by the rate.
Which of the following would most likely be treated as an activity in an activity-based costing system? direct materials cost sales revenues machine processing direct labor cost
Answer: the correct answer is machine processing
Explanation:
Activity-based costing (ABC) is an accounting method that identifies and assigns costs to overhead activities and then assigns those costs to products. Indirect costs, such as management and office staff salaries, are sometimes difficult to assign to a product.
Compare and contrast the idea of extrinsic and intrinsic rewards with Herzberg’s Two-Factor theory of motivation? Does the idea of intrinsic and extrinsic rewards agree in principle with Herzberg, or not? How effectively have you seen intrinsic and extrinsic rewards used in the workplace?
Answer: EXTRINSIC AND INTRINSIC REWARDS CAN BE EXPLAINED AS FOLLOWS :-
Explanation:
Herzberg explained the reward factor into two types.
The first factors were those motivating the employees and exerting them to enhance their performance continuously these factors were called motivators while the factors keeping employees away from dissatisfaction were called hygiene factors.
The idea of extrinsic and intrinsic factors is vary similar to herzberg theory as this theory states external and internal factor as factors affecting performance of employee. In this theory external factors were reasonable pay and other benefits, similar to the hygiene factors and internal factors were achievement recognition etc which are similar to motivators.
So , we can agree that idea of intrinsic and extrinsic factors agree with principle of herzberg.
.
Since the establishment of corporate culture we can see the that external factors were there at the workplace but in present time organisations are now taking care of intrinsic factors as well for long run benefits.
Intrinsic and extrinsic rewards pertain to internal and external motivating factors respectively. Herzberg’s Two-Factor theory suggests extrinsic rewards prevent dissatisfaction, but only intrinsic rewards motivate people. The role and impact of these rewards have varied effectiveness in the workplace.
Explanation:The concept of intrinsic and extrinsic rewards pertains to the sources of motivation that drive people's actions. Intrinsic motivation refers to the internal drives such as personal fulfillment, growth, and happiness that motivate a person to take certain actions. On the other hand, extrinsic motivation comes from the external stimuli like money, praise, and recognition.
Herzberg’s Two-Factor theory, on the other hand, suggests two distinct groups of factors that influence motivation. Hygiene factors - equivalent to extrinsic rewards - can prevent dissatisfaction, but cannot motivate someone, while motivators - similar to intrinsic rewards - cause job satisfaction and motivate people to perform better.
Therefore, while there is some overlap between the concepts, the idea of intrinsic and extrinsic rewards and Herzberg’s Two-Factor theory differ in that Herzberg doesn’t see extrinsic factors as genuine motivators, but only as factors preventing dissatisfaction. In the workplace, intrinsic rewards have been observed to produce long-lasting effects on performance and job satisfaction. Extrinsic rewards - while also effective at boosting motivation - can sometimes reduce intrinsic motivation if they are expected or overtly used to control behavior.
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Suppose investors can earn a return of 2% per 6 months on a Treasury note with 6 months remaining until maturity. The face value of the T-bill is $10,000. What price would you expect a 6-month maturity Treasury bill to sell for? (Round your answer to 2 decimal places.)
The expected price for the 6-month maturity Treasury bill would be approximately $9,901.47.
The price of a Treasury bill (T-bill) can be calculated using the formula for the present value of future cash flows. In this case, the T-bill will mature in 6 months and pay a face value of $10,000.
The price of a T-bill is calculated by using the present value formula:
[tex]P = FV/ (1+r)^n[/tex]
Where:
P is the price of the T-bill
F is the face value of the T-bill ($10,000 in this case)
r is the interest rate per period (2% or 0.02 in this case, since it's given as a percentage)
n is the number of periods until maturity (0.5 years or 0.5 periods in this case, since the T-bill matures in 6 months)
Plugging in the values:
[tex]PV = 10,000/(1+0.02)^{0.5}[/tex]
= 9,901.47.
Therefore, the expected price for the 6-month maturity Treasury bill would be approximately $9,901.47.
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Final answer:
The price of a 6-month maturity Treasury bill can be calculated using the formula Price = Face Value / (1 + (Discount Rate * Time)). In this case, the T-bill with 6 months remaining sells for $9,803.92.
Explanation:
A Treasury bill (T-bill) is a short-term debt security issued by the US government. Its price is determined by the discount rate, which is the difference between the face value of the bill and the price at which it is sold. To calculate the price of a T-bill, you can use the formula:
Price = Face Value / (1 + (Discount Rate * Time)),
where the time is the number of periods until maturity.
In this case, the T-bill has 6 months remaining until maturity and offers a return of 2% per 6 months. To determine the price, we plug in the values:
Price = $10,000 / (1 + (0.02 * 1)),
Calculating, we get:
Price = $10,000 / (1.02).
Rounding to 2 decimal places, the expected price of the T-bill is $9,803.92.
Database Systems is considering expansion into a new product line. Assets to support expansion will cost $750,000. It is estimated that Database Systems can generate $2,150,000 in annual sales, with an 7 percent profit margin. What would net income and return on assets (investment) be for the year? (Input your return on assets answer as a percent rounded to 2 decimal places.)
Answer:
The net income is $150,500 and the return on assets is 20.06 %
Explanation:
The formula for computing net income and return on assets is shown below and the computation is also made.
Net income = Sales revenue × Profit margin
= $2,150,000 × 7%
= $150,500
Return on assets = Net income ÷ total assets
= $150,500 ÷ $750,000
= 0.2006
= 20.06 %
Thus, the net income is $150,500 and the return on assets is 20.06 %
The net income for the year would be $150,500 and the return on assets would be 20%.
Explanation:First, let's calculate the net income:
Net income = Sales revenue * Profit margin
Net income = $2,150,000 * 0.07
Net income = $150,500
Now, let's calculate the return on assets:
Return on assets (ROA) = Net income / Total assets
ROA = $150,500 / $750,000
ROA = 0.20 or 20%
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Manipulation Manufacturing's (AMM) standards anticipate that there will be 5 pounds of raw material used for every unit of finished goods produced. AMM began the month of MayMay with 8,000 pounds of raw material, purchased 25,500 pounds for $ 15,300 and ended the month with 7,400 pounds on hand. The company produced 4,9004,900 units of finished goods. The company estimates standard costs at $ 1.10 per pound. The materials price and efficiency variances for the month of MayMay were:
Answer:
price variance: 13,050 favorable
quantity variance: -1,760 unfavorable
Explanation:
standard quantity 5
standard price 1.1 per pound
actual quantity for 4900 units
[tex] beginning \: inventory + purchases = ending \: inventory + used[/tex]
8000 + 25,500 -7,400 = 26,100 pounds
standard quantity 4,900*5= 24,500
actual price 15,300/25,500 = 0.60
standard price = 1.10
[tex]price \: var = actual \: pounds(STD \: price - actual \: price)[/tex]
[tex]26100(1.1 - 0.6) = 13050 \: favorable[/tex]
Because actual is lower than STD the company saved money spending. It is favorable.
[tex]quantity \: var = STD \: price(STD \: quantity - actual \: quantity)[/tex]
[tex]1.10(24500 - 26100) = - 1760 \: unfavored[/tex]
Because the company used more pounds than STD the quantity variance is unfavorable
The materials price variance for Manipulation Manufacturing for the month of May was -$13,410 unfavorable, while the materials efficiency variance was -$1,760 unfavorable.
Explanation:To calculate the materials price and efficiency variances, we first need to determine the standard cost for the actual amount of raw materials used. The total amount of materials used during May is the starting inventory (8,000 lbs) plus purchases (25,500 lbs) minus ending inventory (7,400 lbs), which equals 26,100 lbs. The standard cost for this is $1.10 per pound, so the total standard cost is $28,710.
The actual cost of the raw materials purchased in May was $15,300, so the materials price variance is the actual cost minus the standard cost, or $15,300 - $28,710 = -$13,410, which is an unfavorable variance because the actual cost was higher than expected.
Next, we calculate the materials efficiency variance. The standard amount of materials expected for the production of 4,900 units is 5 lbs per unit, or 24,500 lbs. The actual quantity used was 26,100 lbs, so the efficiency variance is (24,500 lbs - 26,100 lbs) * $1.10 = -$1,760, which means the company used worse than expected amounts of raw materials, hence it's also unfavorable.
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A firm’s net cash flow from operating activities includes: A) Cash received from sale of equipment B) Cash received from issuance of common stock C) Cash received from sale of merchandise D) Cash received as payment of loan from a borrower
A firm’s net cash flow from operating activities includes: Cash received from sale of merchandise
Answer: Cash received from sale of merchandise- C)
A firm’s net cash flow from operating activities includes cash received from sale of merchandise.
Maloney, Inc., has an odd dividend policy. The company has just paid a dividend of $2 per share and has announced that it will increase the dividend by $6 per share for each of the next five years, and then never pay another dividend. If you require a return of 12 percent on the company’s stock, how much will you pay for a share today? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
The stock price that an investor should be willing to pay today given Maloney, Inc.'s unique dividend policy can be calculated using the present value of dividends for each year over the next five years and the required rate of return of 12 percent.
Explanation:The subject of this question is related to the field of finance, particularly in the topic of company dividends and stock valuation. Maloney, Inc. has announced a unique dividend policy where it will increase the dividend by $6 per share for the next five years and then cease to pay any dividends thereafter. As an investor who is expecting a 12 percent return on your investments, it is crucial to determine the present value of these expected dividends to decide the maximum price you would pay for a share today.
Using the concept of the present value of a series of cash flows (which in this case are dividends), you can calculate the price of a share. The formula for calculating the present value is: PV = D / (1 + r)n where D is the dividend, r is the required rate of return, and n is the number of periods. Apply this formula for each of the next five years and sum them up to get the current price of the share, as follows:
Year 1: $8 / (1.12)1
Year 2: $14 / (1.12)2
Year 3: $20 / (1.12)3
Year 4: $26 / (1.12)4
Year 5: $32 / (1.12)5
By adding the present value of dividends for each year, you find the price you should be willing to pay for a share today considering your required rate of return.
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The price you would be willing to pay for a share of Maloney, Inc., today, given the required rate of return of 12%, is approximately $60.346.
To determine the current price of Maloney, Inc.'s stock today, we need to calculate the present value of the dividends that will be paid over the next five years, and also consider the price of the stock at the end of the fifth year when no more dividends will be paid.
Given:
- Current dividend: $2 per share
- Dividend growth rate: $6 per share per year for 5 years
- Required return (discount rate): 12%
Step 1: Calculate Dividends for Years 1 to 5
The dividends for each year are as follows:
- Year 1: $2 per share
- Year 2: $8 per share (2 + 6)
- Year 3: $14 per share (8 + 6)
- Year 4: $20 per share (14 + 6)
- Year 5: $26 per share (20 + 6)
Step 2: Calculate Present Value of Dividends
Now, calculate the present value (PV) of the dividends using the formula for the present value of a growing annuity:
[tex]PV = \frac{D_1}{(1 + r)^1} + \frac{D_2}{(1 + r)^2} + \frac{D_3}{(1 + r)^3} + \frac{D_4}{(1 + r)^4} + \frac{D_5}{(1 + r)^5}[/tex]
Where:
[tex]D_1 = $2 \\\\ D_2 = $8 \\\\ D_3 = $14 \\\\ D_4 = $20 \\\\ D_5 = $26 \\\\ r = 12\% or 0.12[/tex]
Let's calculate each term:
[tex]PV = \frac{2}{(1 + 0.12)^1} + \frac{8}{(1 + 0.12)^2} + \frac{14}{(1 + 0.12)^3} + \frac{20}{(1 + 0.12)^4} + \frac{26}{(1 + 0.12)^5} \\\\ PV = \frac{2}{1.12} + \frac{8}{1.12^2} + \frac{14}{1.12^3} + \frac{20}{1.12^4} + \frac{26}{1.12^5} \\\\[/tex]
Calculating each term:
[tex]PV = \frac{2}{1.12} + \frac{8}{(1.12)^2} + \frac{14}{(1.12)^3} + \frac{20}{(1.12)^4} + \frac{26}{(1.12)^5} \\\\ PV \approx 1.79 + 6.38 + 9.96 + 12.71 + 14.75 \\\\ PV \approx 45.59[/tex]
Step 3: Calculate Price of Stock Today
Finally, add the present value of the dividends to the price of the stock at the end of Year 5 (when no more dividends will be paid), discounted back to the present value:
[tex]\text{Price today} = PV + \frac{D_5}{(1 + r)^5} \\\\ \text{Price today} = 45.59 + \frac{26}{(1.12)^5}[/tex]
Calculate [tex]\frac{26}{(1.12)^5}[/tex] :
[tex]\frac{26}{(1.12)^5} \approx \frac{26}{1.762 } \approx 14.756 \\\\ \text{Price today} = 45.59 + 14.756 \\\\ \text{Price today} \approx 60.346[/tex]
Therefore, the price you should pay for a share of Maloney, Inc.'s stock today is approximately 60.346 dollars per share.
Project A has a predicted payback period of 2.5 and Project B has a predicted payback period of 5. Based on this information we can conclude that Select one: A. more information should be gathered before deciding on which project, if either, is desirable. B. Project A is preferred to Project B. C. Project B provides twice the return of Project A. D. Project B is preferred to Project A, but it is not necessarily twice as profitable.
Answer:
A. more information should be gathered before deciding on which project, if either, is desirable.
Explanation:
The lower Payback Period is not sufficient information to decide which project is more profitable. The payback period indicates when in the life of a project the initial investment principal cash flow is achieved.
But to decide about a certain project it is better to know the interest yield, it is also important to get the life of the project and other information.
For example:
a.- 250 investment 100 per year payback in 2.5-year life 3 years
b.- 500 investment 100 per year payback in 5-year life 20 years
While A payback occurs before project B is better
Flynn, Inc. is considering a four- year project that has an initial outlay or cost of $80,000. The future cash inflows from its project are $40,000, $40,000, $30,000, and $30,000 for years 1, 2, 3 and 4, respectively. Flynn uses the internal rate of return method to evaluate projects. What is the approximate IRR for this project?
Answer:
The IRR for this project is 28.88%
Explanation:
The Internal Rate of Return (IRR) is that rate of return in which the Net present value (NPV) of the project is zero.
Where, Net Present value is that value in which the initial investment and cash outflows after applying discount factor is equal.
The Internal rate of return is calculated by using the Excel formula:
= IRR (-initial investment, all cash outflows)
The computation is shown in the attachment sheet.
Thus, the IRR for this project is 28.88%
Paige Company estimates that unit sales will be 10,700 in quarter 1, 13,100 in quarter 2, 14,200 in quarter 3, and 18,300 in quarter 4. Using a sales price of $84 per unit. Prepare the sales budget by quarters for the year ending December 31, 2017. PAIGE COMPANY Sales Budget Quarter 1 2 3 4 Year Expected unit sales Unit selling price $ $ $ $ $ Total sales $ $ $ $ $
To prepare the sales budget, multiply the estimated unit sales for each quarter by the selling price per unit. Total sales for the year is the sum of all the quarters' sales.
Explanation:To prepare the sales budget for Paige Company, you multiply the estimated unit sales for each quarter by the unit selling price.
For Quarter 1, this is 10,700 units * $84/unit = $898,800.
For Quarter 2, this is 13,100 units * $84/unit = $1,100,400.
For Quarter 3, this is 14,200 units * $84/unit = $1,192,800.
For Quarter 4, this is 18,300 units * $84/unit = $1,537,200.
The total sales for the year is the sum of each quarter's sales: $898,800 + $1,100,400 + $1,192,800 + $1,537,200 = $4,729,200.
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The sales budget for Paige Company for the year ending December 31, 2017 can be calculated based on the projected unit sales and the unit price. For each quarter, multiply the projected unit sales by the unit price of $84, and then sum up the total sales for all quarters. The total sales for the year is $4,731,200.
Explanation:The sales budget for Paige Company can be calculated by multiplying the estimated unit sales for each quarter by the sales price per unit which is $84.
For Quarter 1: Unit sales = 10,700, Total Sales = 10,700 * $84 = $898,800.
For Quarter 2: Unit sales = 13,100, Total Sales = 13,100 * $84 = $1,102,400.
For Quarter 3: Unit sales = 14,200, Total Sales = 14,200 * $84 = $1,192,800.
For Quarter 4: Unit sales = 18,300, Total Sales = 18,300 * $84 = $1,537,200.
Adding up the total sales for each quarter will give the total sales for the year, which is $898,800 + $1,102,400 + $1,192,800 + $1,537,200 = $4,731,200. Thus, the total sales budget for Paige Company for the year ending December 31, 2017 is $4,731,200.
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1. On a $375,000 home loan, you can either finance at 5.6% for 20 or 30 years. Find the monthly payment and the total paid over each loan. Which loan do you pay more interest on. How much more interest is paid? Are you shocked at the difference?
Answer:
(20 years) Cuota = 2,600.80
Interest 249,192
(30 years) Cuota 2,152.80
Interest 400,008
Diference: 400,008 - 249,192 = 150,816
30 year loan paid 150,816 more interest expense
Explanation:
(20 years)
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
[tex]PV \div \frac{1-(1+r)^{-time} }{rate} = C\\[/tex]
[tex]375,000 \div \frac{1-(1+0.056/12)^{-240} }{0.056/12} = C\\[/tex]
monthly interest .056/12
time 20 years x 12 month a year = 240
Cuota = 2,600.80
Interest
Cuota x payment - principal = interest
240 x 2600.8 - 375,000 = 249,192
(30 years)
[tex]375,000 \div \frac{1-(1+0.056/12)^{-360} }{0.056/12} = C\\[/tex]
monthly interest .056/12
time 30 years x 12 month a year = 360
Cuota 2,152.80
Interest
Cuota x payment - principal = interest
360 x 2152.8 - 375,000 = 400,008
Used Car Problems. ABC Motors sold a used car to Frank, who wrote a bad check for the car and left town but not before he sold the car to Betty, who paid $1,100 (a fair price for the car) believing that Frank had all rights to sell it. ABC Motors asked Frank to return the car, but he told them that he already sold it to Betty. What kind of title did Frank have?
Answer:
Frank had a voidable title, since he committed fraud by paying for the car with a bad check.
Explanation:
A voidable title is a title that can be voided by the grantee (ABC Motors) but is a valid title until voided. The grantee can void the title if some irregularity occurred during the transaction, e.g. fraud by paying with a bad check.
But the title passed to Betty is a good title, since she was an innocent good faith buyer and when she purchased the car the title had not been voided.
Using the percentage-of-receivables method for recording bad debt expense, estimated uncollectible accounts are $31700. If the balance of the Allowance for Doubtful Accounts is $7560 debit before adjustment, what is the amount of bad debt expense for that period?
Answer:
The bad debt expense would be 39,260 for this period
Explanation:
We need to adjust the allowance to match the estimated uncollectible accounts:
31,700 estimated uncolelctible accounts
Allowance for Doubful Account current balance 7,560 debit
If we do the Allowance t account we would have something like this:
[tex]\left[\begin{array}{cc}Debit&Credit\\7,700&Adjustment\\-&31700\end{array}\right][/tex]
[tex]Balance = credit - Debit[/tex]
So to get the adjustment, which is in the credit we will do:
[tex]Balance + Debit = Credit[/tex]
[tex]31,700 + 7,560 = 39,260[/tex]
Now to balance the entry on which we are crediting the allowance for 39,260 we need to recognize an expense for bad debt with the same ammount.
You are given the following information for Thrice Corp.: Decrease in inventory $ 630 Decrease in accounts payable 265 Increase in notes payable 250 Increase in accounts receivable 280 Did cash go up or down? By how much?
Answer:
The cash balance would increase by $335
Explanation:
The given question shows the operating activities of the cash flow statement which deals in increasing and decrease of current assets and liabilities.
1. Decrease in inventory $ 630 increase the cash balance.
2. Decrease in accounts payable $265 decrease the cash balance. As payment would be made regarding purchase
3. Increase in notes payable $250 increase the cash balance because cash is received.
4. Increase in accounts receivable $280 decrease the cash balance because there is not any surety of cash.
After considering these cash effects, we get to know whether cash would be increased or decreased by applying the equation which is shown below:
Cash balance = Decrease in inventory + Increase in notes payable - Decrease in accounts payable - Increase in accounts receivable
= $ 630 + $250 - $265 - $280
= $335
These effects show the source and use of cash funds.
Thus, the cash balance would increase by $335.
Cash balance refers to the amount of money which is hold by the bank on a specific period of time.
The amount of cash balance would go up by $335 during the year.
What is cash balance?A cash balance shows that a company has cash on hand and can use that cash however it wishes. Cash includes more than just the physical conventional bills and coins.
Computation of cash balance:
[tex]\text{Decrease in Inventory} + \text{Increase in notes payable} - \text{Decrease in AP} - \text{Increase in AR}\\\\\\\text{Cash Balance} = \$ 630 + \$250 - \$265 - \$280\\\\\\\text{Cash Balance} =\$335[/tex]
Where,
AP = Accounts Receivable, and
AR = Accounts Receivable.
In the above case, The increasing and decreasing items, are:
1. Decrease in inventory by $630, increase the cash balance.
2. Decrease in accounts payable by $265 also decrease the cash balance.
3. Increase in notes payable by $250 also increase the cash balance because cash is obtained.
4. Increase in accounts receivable by $280, decrease the cash balance because there is not any sure thing of cash.
Therefore, the amount of cash balance would go up by $335.
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On June 30, 2018, K Co. had outstanding 10%, $19,000,000 face value bonds maturing on June 30, 2023. Interest is payable semiannually every June 30 and December 31. On June 30, 2018, after amortization was recorded for the period, the unamortized bond premium was $69,000. On that date, K acquired all its outstanding bonds on the open market at 99 and retired them. At June 30, 2018, what amount should K Co. recognize as gain on redemption of bonds before income taxes?
Answer:
K Co would recognize $259,000 as gain on redemption of bonds before income taxes.
Explanation:
Given information available to us -
Face value of the bond@10% = $19,000,000 (on June 30,2018)
Unamortized bond premium = $69,000
Interest is payable semi annually on every June 30 and December 31
On June 30 K acquired all outstanding bonds at 99% from the open
market and retired them.
So for calculating the gain the first would be to calculate the face value of the bonds on June 30, 2018, which would be equal to =
Face value of the bond + unamortized bond premium
Book value of the bonds = $19,000,000 + $69,000
= $19,069,000
and now we will subtract the redemption price from the book value to see how much gain will come,
GAIN= Book value of bonds - 99% of the face value of the bonds
= $19,069,000 - $18,810,000
= $259,000
Final answer:
K Co. should recognize a gain of $259,000 on the redemption of the bonds before income taxes, calculated by subtracting the bond repurchase price at 99% of face value from the carrying amount with the unamortized bond premium.
Explanation:
To determine the gain on redemption of bonds before income taxes, we need to consider the carrying amount of the bonds and the price at which they were repurchased. K Co.'s bonds had a face value of $19,000,000 and an unamortized bond premium of $69,000, giving them a carrying amount of $19,069,000 ($19,000,000 + $69,000). On June 30, 2018, K Co. repurchased the bonds at 99% of their face value, which means they paid 99% of $19,000,000, equaling $18,810,000.
To calculate the gain, subtract the repurchase price from the carrying amount: $19,069,000 - $18,810,000 = $259,000. Therefore, K Co. should recognize a gain of $259,000 on the redemption of the bonds before income taxes.
If the discount rate is 10% and the cost of a project is $100 investment today with an expected payoff of $50 at the end of year 1 and an expected payoff $80 in year 2, should the project be undertaken?
Answer:
Yes, the project should be accepted.
Explanation:
We will calculate Net Present Value (NPV) of the project. For that cash inflows will be discounted at the rate given i.e. 10%
Current outflow = $100
Inflow at end of year 1 = $50, discounted value =
[tex]{\frac{1}{1+0.1}^1[/tex] X $50 = $45.45
Inflow at end of year 2 = $80, discounted value =
[tex]{\frac{1}{1+0.1}^2[/tex] X $80 = $66.115
NPV = Net inflow - Net outflow = $45.45 + $66.115 - $100 = $11.565
Since NPV is positive,
The project should be accepted.
Several months after the reorganization, Jim Umpleby checks in with department managers to see how their employees are handling the changes Several managers comment that everything must be okay because they haven't heard anything from their employees about the reorganization. Which of the following are methods that Caterpillar could implement in order to hear what employees throughout the organization are thinking and feeling? Check all that apply. Plan surprise visits to office locations Hold town hall meetings with employees Send a voice message to all employees providing updates on the successes of the reorqanization Write a blog which allows for reader comments
Caterpillar could implement town hall meetings, a blog with reader comments, and surprise office visits to hear what employees think and feel after the reorganization.
Explanation:Caterpillar could implement several methods to hear what employees throughout the organization are thinking and feeling after the reorganization. They can hold town hall meetings with employees to provide a platform for open communication and gather feedback. They can also write a blog that allows for reader comments, giving employees an opportunity to share their thoughts. Moreover, they can plan surprise visits to office locations to interact with employees directly.
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Caterpillar could implement surprise visits to offices, town hall meetings, and a blog which allows for comments to hear employee thoughts after reorganization. Additional method could also include regular internal surveys.
Explanation:There are several methods Caterpillar could implement to understand the thoughts and feelings of employees post-reorganization. Firstly, the idea to plan surprise visits to office locations could be effective. These visits could provide a chance for unfiltered conversation between management and employees, offering insights into the effect of the changes. Secondly, holding town hall meetings with employees is a well-known method for hearing broad concerns and ideas. These meetings could be a platform for open-ended conversation about the reorganization. Thirdly, writing a blog with the ability for reader comments would also provide an outlet for candid feedback.
However, a strategy that was not mentioned in the question but could also be beneficial is distributing regular internal surveys to garner candid feedback about the reorganization. This would accommodate for employees who may not feel comfortable voicing their thoughts in public.
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As of December 31, 2018, Warner Corporation reported the following: Dividends payable $ 32,000 Treasury stock 570,000 Paid-in capital—share repurchase 32,000 Other paid-in capital accounts 5,200,000 Retained earnings 4,200,000 During 2019, half of the treasury stock was resold for $250,000; net income was $570,000; cash dividends declared were $1,380,000; and stock dividends declared were $620,000. What was shareholders' equity as of December 31, 2018?
Answer: $9,182,000
Explanation: This question can be done as follows :-
Total shareholders equity = paid in capitals + other paid in capitals + retained earnings - treasury stock
Putting the values into equation we get :-
Total shareholders = $32,000 + $5,200,000 + $4,200,000 - $250,000
equity
= $9,182,000
Assume that you are considering the purchase of a 15-year bond with an annual coupon rate of 9.5%. The bond has face value of $1,000 and makes semiannual interest payments. If you require an 11.0% nominal yield to maturity on this investment, what is the maximum price you should be willing to pay for the bond?
Answer:
We are going to pay $892.137 or less for the bonds.
Explanation:
We need to calculate the present value of the bond at 11% interet rate
Cashflow from the bond:
Principal x interest = interest service
1,000 x 9.5% = 95
Present value of annuity of 95 during 15 year at 11%
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
[tex]95 * \frac{1-(1+.11)^{-15} }{.11} = PV\\[/tex]
Present value of the interest service 683,1326097
Second we have to calculate the present value of the 1,000 principal in 15 years
[tex]\frac{Amount}{(1+rate)^{time}} ) = PV[/tex]
[tex]\frac{1,000}{(1+0.11)^{15}} ) = PV[/tex]
209.0043467
Finally we add both together for the present value fothe bond at our rate
209.0043467+ 683,1326097 = 892.1369564 = 892.137
Myers Company uses a flexible budget for manufacturing overhead based on direct labor hours. Variable manufacturing overhead costs per direct labor hour are as follows. Indirect labor $1.20 Indirect materials 0.50 Utilities 0.20 Fixed overhead costs per month are Supervision $4,400, Depreciation $1,500, and Property Taxes $500. The company believes it will normally operate in a range of 7,700–10,700 direct labor hours per month. Prepare a monthly manufacturing overhead flexible budget for 2017 for the expected range of activity, using increments of 1,000 direct labor hours.
Answer:
[tex]\left[\begin{array}{cccccc}-&rate&7,700&8,700&9,700&10,700\\IL&1.2&9,240&10,440&11,640&12,840\\IM&0.5&4620&5,220&5,820&6,420&Utilities&0.2&924&10,44&1,164&1,284&Total \: Variable&1.9&14,784&16,704&18,624&20,544&Fixed&6,100&6,100&6,100&6100&6,100&MO&-&20,884&22,804&24724&26,644&\end{array}\right][/tex]
Explanation:
You have to apply the rate to each activity level.
for example
DL rate 1.20 x 7700 = 9240
The fixed cost remains constant.
The following income statement was drawn from the records of Joel Company, a merchandising firm: JOEL COMPANY Income Statement For the Year Ended December 31, 2018 Sales revenue (2,000 units × $125) $ 250,000 Cost of goods sold (2,000 units × $65) (130,000 ) Gross margin 120,000 Sales commissions (10% of sales) (25,000 ) Administrative salaries expense (30,000 ) Advertising expense (20,000 ) Depreciation expense (24,000 ) Shipping and handling expenses (2,000 units × $1.00) (2,000 ) Net income $ 19,000 Required Reconstruct the income statement using the contribution margin format. Calculate the magnitude of operating leverage. Use the measure of operating leverage to determine the amount of net income Joel will earn if sales increase by 10 percent.
Answer:
(I)
[tex]\left[\begin{array}{cc}Sales&250,000\\Variable \: Cost&-157,000\\Contribution \: Margin&93,000\\Admin \: expense&-30,000\\adv \: expense&-20,000\\depreciation \: expense&-24,000\\Net \: Income&19,000\\\end{array}\right][/tex]
(II)
Net income will be of 28,300 if sales increase by 10%
Explanation:
(I)
Variable cost:
65 unit cost
+12.5 sales commision (125 x 10%)
+1 shipping and handling epxneses
78.5 total variable cost
78.5 x 2000 = 157,000 variable cost
(II)
[tex]\frac{ContributionMargin}{Profit} = $Operating Leverage\\[/tex]
[tex]Sales \: Revenue - Variable \: Cost = Contribution \: Margin[/tex]
250,000 - 157,000 = 93,000
93,000/19,000 = 4.894736842 = 4.895
10% increase in revenue will ncrease the net income by 148.95%
19,000 x 148.95% = 28300.05
Joel's revised income statement shows a contribution margin of $93,000 and net income of $19,000. The degree of operating leverage is 4.89, implying an increase in net income by 48.9% to $28,291 if sales grew by 10%.
Explanation:The contribution margin income statement contrasts with traditional income statements as it groups costs into variable and fixed costs rather than into product and period costs. First, let's reconstruct the income statement in the contribution margin format:
Sales revenue (2,000 units x $125) = $250,000 Variable costs = Cost of Goods Sold (2,000 units x $65) + Sales Commissions (10% of sales) + Shipping and Handling Expenses (2,000 units x $1) = $130,000 + $25,000 + $2,000 = $157,000 Contribution margin = Sales Revenue - Variable Costs = $250,000 - $157,000 = $93,000 Fixed costs = Administrative Salaries Expense + Advertising Expense + Depreciation Expense = $30,000 + $20,000 + $24,000 = $74,000 Net Income = Contribution Margin - Fixed Costs = $93,000 - $74,000 = $19,000The operating leverage measures the degree to which a firm uses fixed costs in its operations. The higher the degree of operating leverage, the more the firm's income will change for a given change in volume. The formula for the degree of operating leverage is contribution margin divided by net income. Therefore, the degree of operating leverage = $93,000 / $19,000 = 4.89. If sales increase by 10%, net income will increase by 4.89 times 10%, or 48.9%. Therefore, the new net income would be $19,000 x 1.489 = $28,291.
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On January 1, 2014, Howe Company's Accounts Receivable balance was $11,400 and the balance in the Allowance for Doubtful Accounts was $570. On January 5, 2014, a $340 uncollectible account was written-off as uncollectible. Assuming that no other transactions related to accounts receivable had occurred, the net realizable value of accounts receivable immediately after the write-off was Multiple Choice A) $11,400. B) $10,830. C) $10,490. D) $11,060.
Answer:
B) $10,830.
Explanation:
AR 11400
Allowance 570
net 10830
allowane 340
AR 340
AR 11060
Allowance 230
net 10830
The is no change in the net account receivable
A business student conjectures that the Internet caused companies to become more profitable, since many transactions previously handled “face-to-face” could now be completed online. The student compares earnings from a sample of companies from the 1980s to a sample from the 2000s. Explain why this is an observational study. If indeed profitability increased, can she conclude the Internet was the cause? Why or why not?
The study is observational because it compares profitability between the 1980s and 2000s without altering any variables. Increased profitability cannot be solely attributed to the Internet due to numerous other potential contributing factors, which means causation cannot be established from this correlation.
Explanation:The study conducted by the business student is an observational study because it examines data from existing records of company earnings without manipulating any of the variables such as internet usage or other business practices. The student simply observes the differences in profitability before and after the widespread use of the internet.
If profitability did indeed increase in the time frame that coincides with the adoption of the Internet, the student cannot conclusively attribute the rise in profitability solely to the Internet. This is because observational studies do not establish causation but rather show correlation. There could be other contributing factors such as globalization, changes in consumer behavior, or improvements in business processes that may have influenced the companies' profitability.
Furthermore, the increased competition and the ability to reach a global market, both outcomes of advances in technology and globalization, could have spurred companies to optimize productivity, resulting in higher profits. This observation supports the idea that while the Internet may have been one of the contributing factors to increased profitability, it cannot be declared as the definitive cause without ruling out other variables.
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Elephant, Inc.'s cost of goods sold for the year is $2,000,000, and the average merchandise inventory for the year is $129,000. Calculate the inventory turnover ratio of the company. (Round your answer to two decimal places.)
Answer:
15.50
Explanation:
Stock turnover or inventory turnover can be defined as the ratio of the number of times a company has sold or replaced inventory during a given period , generally a year, .
.
It can be computed as follows -
=[tex]\frac{cost of goods sold}{average stock}[/tex]
therefore,
=[tex]\frac{2,000,000}{129,000}[/tex]
= 15.50