Answer:
A. $20,000
Explanation:
Lynn 60,000
Marty 80,000
Nancy 70,000
Total 210,000
The buyout for nancy consist in:
capital balance + Nancy share of unrecorded goodwill
76,000 = 70,000 + 6,000 nancy goodwill
Nnacy share income ratio is 30% so total goodwill is:
6,000/30% = 6,000 / 0.3 = 20,000
The journal entry will be:
goodwill 20,000
Nancy Account 70,000
Cash 76,000
Lynn 8,000
Marty 6,000
Determine which economic principle is illustrated by each scenario. The owner of a snow cone trailer realizes that the demand for snow cones is low during the winter, and thus, closes shop until the temperature warms back up near summertime. The local river has so much pollution that three-eyed fish are forming. The government responds by regulating the amount of chemicals that can be dumped into the river. At a high-end restaurant, the restaurant owner has one chef at a meat station, one chef at a vegetable station, and one chef, who has an artistic eye, plate the food she is given. The result is increased service speed, and the kitchen is able to serve more customers in an evening. During the summer, a bumper crop of oranges in Florida causes a surplus in the supply of oranges nationwide. As a result, prices fall to compensate for the surplus and consumers enjoy the fruits of the farmers' labor. Answer Bank
Answer:
The correct answer is: market efficiency; government intervention; specialization; equilibrium.
Explanation:
The owner of the snow cones realizes that the demand for snow cones has decreased in winter, and thus, closes shop to open back. This is an example of market efficiency.
The local river is being polluted too much because of the huge quantity of chemicals being dumped in the river. The government, as a result, enforces regulation on the quantity of chemicals being dumped. This is an example of government intervention in the economy.
At a restaurant one chef is placed at the vegetable station, one chef is at meat station, and one is to plate the food. This an example of specialization the management is placing chef that specializes in vegetable, meat and in plating at their respective positions. So they can work in the most efficient manner and the service speed increases.
The favorable weather leads to an increase in the supply of oranges. This causes a rightward shift in the supply curve. The price of oranges fall as a result. This is an example of change in equilibrium.
The described scenarios illustrate the law of demand, government regulation, division of labor, and the law of supply in various economic contexts, demonstrating the responsiveness of markets to changes and external factors.
Explanation:The scenarios provided illustrate different economic principles:
The snow cone trailer owner's decision to close shop during winter demonstrates the law of demand, where he recognizes that demand for snow cones decreases as the temperature drops.The government's intervention to regulate pollution showcases government regulation influencing market outcomes to protect public health and the environment.The high-end restaurant optimizing its staff's skills for efficiency represents the principle of division of labor, which increases productivity and service speed.The drop in orange prices due to a bumper crop exemplifies the law of supply, where an increase in supply, if not matched by an increase in demand, typically leads to lower prices.These scenarios underscore how markets operate under the laws of demand and supply, and how both producers and consumers respond to changes in market conditions, including seasonal variations and government policies.
The Longo Corporation issued $60 million maturity value in notes, carrying a coupon rate of six percent, with interest paid semiannually. At the time of the note issue, equivalent risk-rated debt instruments carried yield rates of eight percent. The notes matured in five years.Calculate the proceeds that Longo Corporation will receive from the sale of the notes. How will the notes be disclosed on Longo’s balance sheet immediately following the sale? Calculate the interest expense for Longo Corporation for the first year that the notes are outstanding. Calculate the balance sheet value of the notes at the end of the first year
Answer:
It will receive: 47,015,745
Balance sheet after issuance of the bonds:
bonds payable: 60,000,000
discount on bond payable: (12,984, 255)
carrying value: 47, 015, 745
Interest expense for the first years outstanding: 3,764,485
Balance sheet after one year:
bonds payable: 60,000,000
discount on bond payable: (12,819,770)
carrying value: 47,180,230
Explanation:
We will calculate the present value of the coupon payment and the maturity at the market value.
Present value of the cuopon using ordinary annuity present value
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
Coupon payment: 60,000,000 x 6%/2 as the payment are semiannually $1,800,000
time: 5 years x 2 payment per year = 10 payment
rate 8% / 2 paymnet per year: 0.04
[tex]1800000 \times \frac{1-(1+0.04)^{-10} }{0.04} = PV\\[/tex]
PV $14,599,612.4028
Maturity present value using lump sum present value
[tex]\frac{Maturity}{(1 + rate)^{time} } = PV[/tex]
Maturity 60,000,000.00
time 8.00
rate 0.08
[tex]\frac{60000000}{(1 + 0.08)^{8} } = PV[/tex]
PV 32,416,133.07
Then we sum both:
PV coupon $14,599,612.4028
PV maturity $32,416,133.0701
Total market $47,015,745
face value: 60,000,000
discount: 12 ,984,255
Interest expense:
first payment:
47,015,745 x 0.08/2 = 1.880.630 interest expense
cash proceeeds 1,800,000
amortization 80,630
second payment:
(47,015,745 + 80,630) = carrying value = 47,096,375
47,096,375 x 0.04 = 1,883,855 interest expense
cash proceeds 1,800,000
amortization 83,855
total interest expense 1,880,630 + 1,883,855 = 3,764,485
discount on bonds: 12 ,984,255 - 80,630 - 83,855 = 12,819,770
The proceeds from the sale of the notes, the interest expense for the first year, and the balance sheet value of the notes at the end of the first year, can all be determined from the details provided. The bond's present value and the interest expenses form crucial parts of these calculations. These notes will be marked as a liability on Longo's balance sheet.
Explanation:To answer this question, we need to understand a few basic concepts related to bonds. A bond is basically an 'I owe you' note from the issuer to the investor, with the face value being the amount the issuer agrees to pay the investor at maturity. The coupon rate or interest rate is defined beforehand and in this case are paid semiannually. The bond's present value is the maximum amount an investor would be willing to pay for it, and depends on market conditions.
Now, the Longo Corporation has issued notes with a maturity value of $60 million, carrying a coupon rate of six percent, with interest paid semiannually. However, the equivalent risk-rated debt instruments carried yield rates of eight percent. Therefore, the present value of the bond would be less than the face value because the coupon rate is less than the market rate.
To calculate the proceeds that Longo Corporation will receive from the sale of the notes, we need to take into account the face value, coupon rate, market rate and maturity. We will also need to calculate the interest expense for the first year which will incorporate the interest rate, face value, and the number of periods.
Finally, the notes will be disclosed on Longo's balance sheet as a liability reflecting the amount that Longo owes to the investors. The balance sheet value of the notes at the end of the first year would reflect the present value of the bond, plus any interest expenses accumulated over the year.
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Despite some problems with equating GDP with economic well-being, real GDP per person does imply greater economic well-being because it tends to be positively associated with:
A. crime, pollution, and economic inequality. B. better education, health and life expectancy.
C. poverty, depletion of nonrenewable resources, and congestion. D. unemployment, availability of goods and services, and better education.
Answer:
B
Explanation:
A positive relationship between two variables or quantities happens when both increase if one increases or both decrease if one decreases. In this case, the problem states that real GDP per person is positively associated with well-being, which means that if GDP increases then well-being increases too. For instance, we should look for variables that if they increase then the well-being increases too. It is not option A,C or D because if there is an increase in crime, poverty or unemployment, people´s well-being will decrease, so those variables are negatively associated with GDP. The answer is B because if there is better education, health and life expectancy, people´s well-being increases.
Considering the world economic outlook for the coming year and estimates of sales and earning for the pharmaceutical industry, you expect the rate of return for Lauren Labs common stock to range between -20 percent and +40 percent with the following probabilities:Probability Possible Returns.10 -.20.15 -.05.20 .10.25 .15.20 .20.10 .40Compute the expected rate of return E(Ri) for Lauren Labs.
Answer:
The expected rate of return E(Ri) for Lauren Labs is 16.5%
Explanation:
The formula to compute the expected rate of return is shown below:
Expected rate of return = (Probability 1 × Possible Returns 1) + (Probability 2 × Possible Returns 2) + (Probability 3 × Possible Returns 3) + (Probability 4 × Possible Returns 4) + (Probability 5 × Possible Returns 5) + (Probability 6 × Possible Returns 6)
= (0.10 × 0.20) + (0.15 × 0.05) + (0.20 × 0.10) + (0.25 × 0.15) + (0.20 × 0.20) + (0.10 × 0.40)
= 2% + 0.75% + 2% + 3.75% + 4% + 4%
= 16.5%
Final answer:
The expected rate of return for Lauren Labs common stock is calculated by multiplying each possible return by its probability and summing the results, giving an expected rate of return of 11%.
Explanation:
To compute the expected rate of return E(Ri) for Lauren Labs, we multiply each possible return by its corresponding probability and sum up these products. The calculation is as follows:
(0.10 × -0.20) = -0.02
(0.15 × -0.05) = -0.0075
(0.20 × 0.10) = 0.02
(0.25 × 0.15) = 0.0375
(0.20 × 0.20) = 0.04
(0.10 × 0.40) = 0.04
Adding up these products, we get the expected rate of return for Lauren Labs:
-0.02 - 0.0075 + 0.02 + 0.0375 + 0.04 + 0.04 = 0.110 or 11%
Therefore, based on the provided probabilities and returns, the expected rate of return for Lauren Labs common stock is 11%.
During the year, credit sales amounted to $ 820 comma 000$820,000. Cash collected on credit sales amounted to $ 760 comma 000$760,000, and $ 18 comma 000$18,000 has been written off. At the end of the year, the company adjusted for bad debts expense using the percentminus−ofminus−sales method and applied a rate, based on past history, of 2.52.5%. The ending balance of Accounts Receivable is ________.
Answer:
Account Receivable 42,000
Allowance (20,500)
Net 21,500
Explanation:
credit sales: 820,000
cash collected (760,000)
write-off (18,000)
Account Receivable 42,000
allowance for bad debt expense
820,000 x 2.5% = 20,500
The accout receivable gross balance will be 42,000
and the net will be 42,000 - 20,500 = 21,500
Winston Watch's stock price is $70 per share. Winston has $10 billion in total assets. Its balance sheet shows $1 billion in current liabilities, $3 billion in long-term debt, and $6 billion in common equity. It has 400 million shares of common stock outstanding. What is Winston's market/book ratio? Do not round intermediate calculations. Round your answer to two decimal places.
Answer:
The Market/book ratio is 5.67.
Explanation:
Book value per share = (common equity)/(number of shares)
= ($ 6 billion)/($ 400million )
= $ 15 per share
Market/book ratio = (market price per share)/(book value per share
= $75/$15
= 5.00
Therefore, the Market/book ratio is 5.67.
How should cumulative preferred dividends in arrears be shown in a corporation's statement of financial position?
a. Note disclosure
b. Increase in stockholders' equity
c. Increase in current liabilities
d. Increase in current liabilities for the amount expected to be declared within the year or
operating cycle, and increase in long-term liabilities for the balance
Answer: Option A
Explanation: The unpaid dividends on cumulative preferred stock are recorded on the notes of the financial statements. These dividends are generally omitted and are not declared by the organisation liable to pay them. Hence they are not recorded on the balance sheet and are shown as footnotes.
From the above we can conclude that the correct option is A.
The correct option is a. Note disclosure. Cumulative preferred dividends in arrears be shown in a corporation's statement of financial position as note disclosure.
Cumulative preferred dividends in arrears are not recorded as liabilities on the balance sheet since they are not actual liabilities until declared. Instead, they are disclosed in the notes to the financial statements to inform stakeholders about the potential obligation that may impact future dividend payments.
Why other options are incorrect:
b. Increase in stockholders equity
Cumulative preferred dividends in arrears do not affect stockholders' equity directly. They are not recognized as part of equity until declared, so they should not be added to the stockholders' equity section of the balance sheet.
c. Increase in current liabilities
These dividends are not considered current liabilities until they are declared. Until declared, they are not recognized as liabilities on the balance sheet. Therefore, they should not be included in current liabilities.
d. Increase in current liabilities for the amount expected to be declared within the year or operating cycle, and increase in long-term liabilities for the balance
This option is incorrect because cumulative preferred dividends in arrears are not recorded as liabilities at all until they are declared. They are only disclosed in the notes to the financial statements, rather than being categorized as current or long-term liabilities.
A friend of yours is considering two cell phone service providers. Provider A charges $120 per month for the service regardless of the number of phone calls made. Provider B does not have a fixed service fee but instead charges $1 per minute for calls. Your friend's monthly demand for minutes of calling is given by the equation QD=150−50P, where P is the price of a minute. Your friend would obtain _________ in consumer surplus with Provider A and _______ in consumer surplus with provider B. Given this information, which provider would you recommend that your friend choose?
Answer:
for provider B the surplus is 100
for provider A te surplus is 125
If my friend is a rational consumer it will pick the Provider A
Explanation:
if P = 1 then:
150 - 50(1) = 100
To know the surplus we calculate the area of the demand above the market price:
(P0 -Pm)Qm/2
(3-1) x (100) / 2 = 2 x 100 / 2 = 100
For provider A then P will be zero so
150 - 50(0) = 150 minutes
the surplus will be the area of the demand curve less the fixed cost
3*150/2 - 100 = 225 - 100 = 125
The consumer surplus with Provider A is $0 because the cost they are willing to pay and what they actually pay is the same. For Provider B, the consumer surplus is $25 because Provider B charges for each individual minute used. Therefore, if the only thing considered is consumer surplus, Provider B is the better option.
Explanation:To analyze the consumer surplus for each provider, we need to understand the demand equation QD=150-50P and apply it to the cost structures of each provider. For provider A, the price is always $120 a month, regardless of the minutes used. As a result, the consumer surplus for provider A is the difference between the maximum the customer is willing to pay and the actual cost they pay, which ends up being $0 as these amounts are the same.
For provider B, the cost of each minute is $1. Insert this value into the demand equation to find QD=150-50(1) = 100 minutes. The consumer surplus with provider B would be 0.5 * (150 - 100) * (1 - 0) = $25.
In conclusion, if consumer surplus is the only factor considered, your friend should choose provider B which provides a >$25< consumer surplus compared to $0 of provider A.
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On May 19, Integrity Repair Service extended an offer of $335,000 for land that had
been priced for sale at $363,000. On June 4, Integrity Repair Service accepted the seller's
counteroffer of $345,000. On October 10, the land was assessed at a value of $290,000
for property tax purposes. On February 5 of the next year, Integrity Repair Service was
offered $380,000 for the land by a national retail chain. At what value should the land
be recorded in Integrity Repair Service's records?
Answer:
$345,000
Explanation:
Counter offer: The counter-offer is the changes made in the existing offer terms and conditions. It is usually made for negotiations, in which both the party can agree at the final price.
According to the accounting principles, the land value should be recorded at the historical cost but in the given case, it is recorded at the counter offer value because, in this offer, both the parties are ready to buy and sell the fixed assets i.e land.
It records only purchase cost of the land ,not any land improvement costs. So, only $345,000 should be recorded in Integrity Repair Service's records
Blossom Company has the following inventory data:
Nov. 1 Inventory 35 units @ $7.10 each
8 Purchase 142 units @ $7.60 each
17 Purchase 71 units @ $7.45 each
25 Purchase 106 units @ $7.80 each
A physical count of merchandise inventory on November 30 reveals that there are 118 units on hand. Ending inventory (rounded) under FIFO is
Answer:
Ending inventory= $916.2
Explanation:
Giving the following information:
Nov. 1 Inventory: 35 units $7.10 each
Nov. 8 Purchase: 142 units $7.60 each
Nov. 17 Purchase: 71 units $7.45 each
Nov. 25 Purchase: 106 units $7.80 each
Nov. 30 ending inventory: 118 units on hand. FIFO (first-in, first-out)
Ending inventory= 106*7.8+12*7.45= $916.2
Nancy Kirkwood runs a small job shop where garments are made. The job shop employs 8 workers. Each worker is paid $10 per hour. During the first week of March, each worker worked 45 hours. Together, they produced a batch of 132 garments. Of these garments, 52 were "seconds" (meaning that they were flawed). The seconds were sold for $90 each at a factory outlet store. The remaining 80 garments were sold to retail outlets at a price of $198 per garment. What was the labor productivity, in dollars per labor-hour, at this job shop during the first week of March?
Answer:
productivity per labor hours: 55.55 dollars
Explanation:
productivity per hour:
total output/total hours
total output:
52 second quality garment x $80 each = 4,160
80 first quality garment x $198 each = 15,840
total output 4,160 + 15,840 = 20,000
hours worked:
8 workers at 45 hours each = 360 hours
Productivity: 20,000/360 = 55.55
each labor hour produced $55.55 dollar per labor hours
[5] According to the FASB’s conceptual framework, which of the following best describes the distinction between expenses and losses? A. Losses are reported net of related tax effect, and expenses are not. B. Losses are decreases in net assets, and expenses are not. C. Losses are material, and expenses are immaterial. D. Losses result from peripheral or incidental transactions, and expenses result from ongoing major or central operations of the entity
Answer:
D. Losses result from peripheral or incidental transactions, and expenses result from ongoing major or central operations of the entity
Explanation:
The expenses represent the cash outlow or liabilities taken to carry out the activities to continue his operations.
While the Gains and Losses are incidental transactions or other events which are not controlled by the entity management. They aren't the outcome of the company's decisions. Thus, they could arise from changes in price of real state, equipment, tecnology breakthrough which means equipment obsolete and so on.
If you deposit $1,000 into a savings account that pays you 5% interest per year, approximately how long will it take to double your money?If you deposit $1,000 into a savings account that pays you 5% interest per year, approximately how long will it take to double your money?"
Answer:
It will take 14 years.
Explanation:
Imagine you are Julie at year cero about to purchase eleven acres of land. The seller tells you that in X amount of years it will value $34686 because it increases 5% each year. He also tells you that according to the Present Value formula, the eleven acres are worth today $15890.
The formula is:
PV=Ct/[(1+r)^n]
Ct= cash flow at t time
r= rate
n= period of time
To calculate how many years it will be worth $34686 you need to isolate n from the PV formula
n=[ln(Ct/PV)]/ln(1+r)
n=ln(34686/15890)/ln(1+0,05)
n=16
Giving the following information, we need to calculate how many years will take to the investment to duplicate:
I= $1000
I=5%
To calculate we are going to use the Present value formula:
PV=Ct/[(1+r)^n]
Ct= cash flow at t time
r= rate
n= period of time
To calculate how many years it will take to duplicate we need to isolate n from the PV formula
n=[ln(Ct/PV)]/ln(1+r)
n=ln(2000/1000)/ln(1+0,05)
n=14
One reason we need government, even in a market economy, is that a the invisible hand seldom leads to an efficient allocation of resources in any market. b property rights become too entrenched in the absence of government. c the invisible hand, while powerful, is not perfect. d there are insufficient quantities of externalities in the absence of government.
Answer:
The correct answer is option c.
Explanation:
The term 'invisible hand' was coined by the economist Adam Smith in his book "Wealth of nations". It refers to the invisible market force that helps the economy to reach the equilibrium.
This invisible force though powerful is not perfect. In some cases, it fails to achieve efficiency which leads to market failure. In such situations, government intervention is necessary to efficiently allocate resources in the economy. So even in a market economy, we need government.
The Richards Company manufactures a single product. All raw materials used are traceable to specific units of product. Current information for the Richards Company follows: Beginning raw materials inventory $ 15,000 Ending raw materials inventory 17,000 Raw material purchases 95,000 Beginning work in process inventory 45,000 Ending work in process inventory 30,000 Direct labor 135,000 Total factory overhead 65,000 Beginning finished goods inventory 60,000 Ending finished goods inventory 50,000 The company's cost of raw materials used, cost of goods manufactured and cost of goods sold is:
Answer:
Cost of raw materials=$93,000
Cost of manufactured period=$308,000
COGS= $318,000
Explanation:
A) Cost of raw materials:
We need to use the following formula:
Cost of raw materials= beginning inventory + purchase - ending inventory= 15,000 + 95,000 - 17,000= $93,000
B) We need to calculate the production during the period.
Cost of manufactured period= Beginning work in progress inventory+ direct materials + direct labor + factory overhead - ending work in progress
Cost of manufactured period= 45,000+ 93,000 + 135,000 + 65,000 - 30,000 =$308,000
C) The cost of goods sold refers to the direct costs attributable to the production of the goods sold in a company. This amount includes the cost of the materials used in creating the goods along with the direct labor costs used to produce the goods. It excludes indirect expenses, such as distribution costs and sales force costs.
COGS=Beginning Inventory+Production during period−Ending Inventory
COGS= 60,000 + 308,000 - 50,000 =$318,000
This calculation breaks down the various costs associated with a manufacturing company. The cost of raw materials used is $93,000. The cost of goods manufactured equals $308,000 and the cost of goods is $318,000.
Explanation:First, let's calculate the cost of raw materials used. You start with the beginning raw materials inventory of $15,000, add raw materials purchases of $95,000, then subtract the ending raw materials inventory of $17,000. So the cost of raw materials used is $15,000 + $95,000 - $17,000 = $93,000.
Next, let's calculate the cost of goods manufactured. The cost of goods manufactured consists of the cost of raw materials used ($93,000), direct labor ($135,000), and total factory overhead ($65,000). The sum of these is $293,000. To this, we then add the beginning work in process inventory ($45,000) and subtract the ending work in process inventory ($30,000). So the cost of goods manufactured is $293,000 + $45,000 - $30,000 = $308,000.
Finally, let's calculate the cost of goods sold. The cost of goods sold begins with the cost of goods manufactured ($308,000) and adds the beginning finished goods inventory ($60,000), then it subtracts the ending finished goods inventory ($50,000). So, the cost of goods sold is $308,000 + $60,000 - $50,000 = $318,000.
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Suppose you bought 700 shares of stock at an initial price of $43 per share. The stock paid a dividend of $0.40 per share during the following year, and the share price at the end of the year was $44. Compute your total dollar return on this investment.
Answer:
Total dollar return = $980
Explanation:
Data:
S = Shares of Stock = 700
P0 = Initial Price = $43
D = Dividends = $0.40
P1 = Price at the end of the year = $44
DR = Dollar Return = ?
Equation:
DR = S * (P1 - P0 + D)
Calculation:
DR = 700 * ($44 - $43 + $0.40)
DR = 700 * ($1.40)
DR = $980
The total dollar return on this investment is $980.
Hope this helps!
You want to have the equivalent of $700,000 (in terms of today's spending power) when you retire in 30 years. Assume a 3% rate of annual inflation. If you can earn 10% annually, how much do you have to invest per year in order to have your full amount of money needed at retirement?(A) 21230.00(B) 85,651.00(C) 7856.00(D) 10,329.00
Answer:
The correct answer is D: $10,329
Explanation:
Giving the following information:
You want to have the equivalent of $700,000 (in terms of today's spending power) when you retire in 30 years. Assume a 3% rate of annual inflation. The interest rate is 10% annual.
First, we need to determine how much is $700,000 in 30 years.
FV= PV*(1+i)^n
FV= 700000*(1.03^30)= $1,699,083.73
Now, we can calculate the annual payment required using the following formula:
FV= {A*[(1+i)^n-1]}/i
A= annual payment
Isolating A:
A= (FV*i)/{[(1+i)^n]-1}
A= (1,699,083.73* 0.10)/[(1.10^30)-1]= $10329
To have the equivalent of $700,000 in terms of today's spending power at retirement, you would need to invest approximately $331,763.82 per year. This calculation takes into account a 3% rate of annual inflation and an annual earning rate of 10%.
Explanation:To calculate the amount you need to invest per year in order to have $700,000 at retirement, we can use the concept of present value. We need to find the present value of $700,000 in terms of today's spending power considering a 3% rate of annual inflation.
Using the present value formula:
PV = FV / (1 + r)ⁿ
Where PV is the present value, FV is the future value, r is the discount rate, and n is the number of years. In this case, FV is $700,000, r is 3%, and n is 30 years.
Plugging in the values:
PV = 700,000 / (1 + 0.03)³⁰ = $329,504.37
Now, we can use the present value formula again to calculate the amount to invest per year:
PV = PMT× [(1 - (1 + r)⁻ⁿ) / r]
Where PMT is the amount to invest per year. Plugging in the values:
329,504.37 = PMT × [(1 - (1 + 0.1)⁻³⁰) / 0.1]
Simplifying the formula:
329,504.37 = PMT× [(1 - 0.007210523) / 0.1]
329,504.37 = PMT×0.99278948
PMT = 329,504.37 / 0.99278948 = $331,763.82
Therefore, you would need to invest approximately $331,763.82 per year to have the full amount of money needed at retirement.
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In order to understand how the price of a good is determined in the free market, one must account for the desires of:
A. purchasers exclusively.
B. sellers exclusively.
C. governmental agencies exclusively.
D. purchasers and seller
Answer: Purchasers and sellers
Explanation: Free market refers to a market structure in which the goods and services are priced on the basis of market forces of demand and supply. The intervention of Government in such markets for the purpose of price controlling is very minimal.
The demand force depends on the purchasers and the supply force depends on the sellers.
Thus, from the above we can conclude that the correct option is A.
The 2013 annual report of Oracle Corporation included the following information relating to their allowance for doubtful accounts: Balance in allowance at the beginning of the year $323 million, accounts written off during the year of $145 million, balance in allowance at the end of the year $296 million. What did Oracle Corporation report as bad debt expense for the year?
(A) $27 million
(B) $178 million
(C) $118 million
(D) $151 million
(E) None of the above
Answer:
Oracle Corporation report as bad debt expense for the year: $118 million
Explanation:
allowance at the end of the year - allowance at the beginning of the year + accounts written off during the year = bad debt expense for the year
$296 million - $323 million + $145 million = $118 million
The accounts written off during the year increase the expense because they are uncollectible so there were removed from a receivable account in the general ledger. The way to do so is:
A credit to Accounts Receivable, and a debit to Allowance for Doubtful Accounts
In the context of market segmentation, unlike global citizens, global dreamers:
a. may not be able to afford, but nevertheless admire, global brands.
b. are skeptical about whether global brands deliver higher-quality goods.
c. are most likely to lead anti-globalization demonstrations.
d. believe that not all global brands are acceptable in the market.
Answer:
a. May not be able to afford, but nevertheless admire, global brands.
Explanation:
Let's analize all the statements for separate.
A.Global dreamers favour the global brands. Unlike global citizens can't afford them, but still admire them.
B. Refers to Antiglobals
C. Refers to global agnostics
D. Is against some global brands, can be seen as soft global agnostic.
Your company is contemplating bidding on an RFP (Request For Proposal) to produce 100,000 units of a specialized part. Suppose, however, that the requesting company really needs only 90,000 units of the part. Also assume that, because the part is specialized, potential suppliers do not yet possess the machines and factories needed to produce it and that overhead expenses involved in production have yet to be incurred. Suppose the average costs of all potential suppliers are as follows: Units Average Total Cost (Dollars Per Unit) 90,000 4 100,000 3 True or False: The requesting company can solicit lower bids by requesting 100,000 units as opposed to 90,000. True False
Answer: True
Explanation:
Average costs of all potential suppliers:
Units = 90,000 at average total cost = $4 per unit
So,
Total cost = No. of units × Average total cost per unit
= 90,000 × $4
= $360,000
Units = 100,000 at average total cost = $3 per unit
So,
Total cost = No. of units × Average total cost per unit
= 100,000 × $3
= $300,000
Hence, the company will save 60,000 dollar if it orders 100,000 units.
Answer:
True
Explanation:
The computation is shown below:
At 90,000 units
The total cost is
= 90,000 units × $4
= 360,000 units
At 100,000 units
The total cost is
= 100,000 units × $3
= $300,000
So as we can see that there is a difference of $60,000 after deducting the total cost at 90,000 units from total cost at 100,000 units
Therefore, in 100,000 units the company could save $60,000
Hence, the given statement is true
Creating an endowment Personal Finance Problem On completion of her introductory finance course, Marla Lee was so pleased with the amount of useful and interesting knowledge she gained that she convinced her parents, who were wealthy alumni of the university she was attending, to create an endowment. The endowment will provide for three students from low-income families to take the introductory finance course each year in perpetuity. The cost of taking the finance course this year is $300 per student (or $900 for 3 students), but that cost will grow by 2.2% per year forever. Marla's parents will create the endowment by making a single payment to the university today. The university expects to earn 6% per year on these funds. a. What will it cost 3 students to take the finance class next year? b. How much will Marla's parents have to give the university today to fund the endowment if it starts paying out cash flow next year? c. What amount would be needed to fund the endowment if the university could earn 8% rather than 6% per year on the funds?
Answer:
Course cost netxt year: 919.8
Perpetuity fund at 6% return: 24,205.27
Perpetuity funds at 8% return: 15,858.63
Explanation:
1 student 300
3 student 900
it grows at 2.2% per year
the return on the fund will be of 6%
The cost of the couse for next year will be:
900 x (1+2.2%) = 900 x 1.022 = 919.8
The perpetuity will be calculate as follow:
[tex]\frac{cost}{return-growth} = Perpetuity[/tex]
[tex]\frac{919.8}{0.06-0.022} = Perpetuity[/tex]
Perpetuity fund: 24205.26316
Ifthe return is for 8% per year:
[tex]\frac{919.8}{0.08-0.022} = Perpetuity[/tex]
Perpetuity funds: 15858.62069
The cost for 3 students to take the finance course next year would be $919.8. The initial endowment needed would be $22,995. An 8% fund's rate of return would decrease the necessary endowment to $15,996.55.
Explanation:The main concern of the problem shared involves evaluating a financial endowment created for the purpose of sponsoring students for a finance course. This falls under the field of Financial Mathematics, particularly focusing on the concept of perpetuities.
The cost for 3 students to take the finance class next year would require accounting for a 2.2% increase on the current cost of $900. This would come out to $900 * 1.022 = $919.8. To calculate the endowment amount needs to cover the perpetuity, Marla's parents would need to determine the present value of a growing perpetuity. The equation PV = D / (r - g) could be used, where D is the cost of the class next year, r is the return rate of 6%, and g is the growth rate of 2.2%. Using these values, the endowment needed would be $919.8 / (0.06 - 0.022) = $22,995. If the university could earn 8% rather than 6% per year on the funds, the calculation would change slightly. Utilizing the same growing perpetuity formula would get an endowment amount of $919.8 / (0.08 - 0.022) = $15,996.55. Learn more about Endowment Funding here:
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During 2020, Bramble Company changed from FIFO to weighted-average inventory pricing. Pretax income in 2019 and 2018 (Bramble’s first year of operations) under FIFO was $175,550 and $183,900, respectively. Pretax income using weighted-average pricing in the prior years would have been $147,000 in 2019 and $175,200 in 2018. In 2020, Bramble reported pretax income (using weighted-average pricing) of $201,100. Show comparative income statements for Bramble, beginning with "Income before income tax," as presented on the 2020 income statement. (The tax rate in all years is 30%.)
Answer:
Explanation:
For showing the comparative income statement, first we have to do the calculations which are shown below:
For 2020 = Pretax income using weightage average pricing - tax rate @30%
= $201,100 - $60,330
= $140,770
For 2019 = Pretax income using weightage average pricing- tax rate @30%
= $147,000 - $44,100
= $102,900
For 2018 = Pretax income using weightage average pricing - tax rate @30%
= $175,200 - $52,560
= $122,640
We ignored the computation through FIFO method
The computation of the comparative income is shown in spreadsheet. Kindly find the attachment below:
At night, use _____ on your rearview mirror. A. the hands-free setting B. cleaning solution C. windshield wiper fluid D. night view
Answer:
The correct answer is option D. night view
Explanation:
The first option, the hands-free setting, is a feature of the car which allows you to speak over the phone without using your hands and allowing you to maintain full control of the steering wheel and the gear shift lever, and it does not have anything to do with the rearview mirror.
Option B, cleaning solution, while it may be useful in order to clean your rearview mirror, that is a thing that shouldn't be done at night, because you are not able to clearly see at night if you wiped it down for good, and you might leave some residue that possibly could bother you when looking at the mirror.
Windshield wiper fluid isn't for cleaning your rearview mirror, but for helping removing residue/bugs stuck on your windshield.
Finally, option D, night view, is the correct option. Night view is a setting of rearview mirrors that is quite useful at night, because it reduces the amount of light reflected to the driver, avoiding the glare of high-beam headlights of cars behind to be directly reflected to the driver's eye that would make quite hard to focus in the dark ahead. It works by tilting the mirror out of line with the driver's view. In day mode, the reflection seen by the driver comes from the reflective surface, while in night view, the reflection comes from the glass, which only reflects a fraction of the light that the reflective surface does.
At night, use A. the hands-free setting on your rearview mirror.
At night, it is important to minimize distractions and ensure clear visibility while driving. Using the hands-free setting on your rearview mirror, if available, can help reduce glare from the headlights of trailing vehicles. This setting typically adjusts the angle of the mirror to reflect less light directly into the driver's eyes, which can be particularly helpful during nighttime driving.
find deri(10 points) A survey gives the value of the following variables for a sample of households in the UK: x1= number of people in the household x2= total household income x3= total household expenditure on food x4= total household expenditure on clothing x5= total household expenditure on alcohol and tobacco x6= total household expenditure on other goods write the functions which give: (a) total household income (b) total household saving (c) income per person (d) expenditure on clothing per person
Answer:
Instructions are listed below
Explanation:
Giving the following information:
x1= number of people in the household
x2= total household income
x3= total household expenditure on food
x4= total household expenditure on clothing
x5= total household expenditure on alcohol and tobacco
x6= total household expenditure on other goods
A) total household income = x2
B) total household saving= x2-x3-x4-x5-x6
C) income per person= x2/x1
D) expenditure on clothing per person= x4/x1
Betty, a project manager, sent out agendas before an upcoming meeting to everyone involved. During the meeting, she got a team member to take minutes. After the meeting, Betty followed up with team members to check on their prog- ress. Evaluate Betty’s actions using the PDCA model. What, if anything, could she have done better?
Answer:
Check: Review the test, analyze the results, and identify what you’ve learned.
Explanation:
The four phases are:
Plan: identify and analyze the problem or opportunity, develop hypotheses about what the issues may be, and decide which one to test.
Do: test the potential solution, ideally on a small scale, and measure the results.
Check/Study: study the result, measure effectiveness, and decide whether the hypothesis is supported or not.
Act: if the solution was successful, implement it
Final answer:
Evaluate Betty's actions using the PDCA model and suggest improvements for her meeting management.
Explanation:
Betty's actions can be evaluated using the PDCA model:
Plan: Sending out agendas before the meeting.
Do: Conducting the meeting and assigning a team member to take minutes.
Check: Following up with team members to check progress.
Act: Making improvements based on the meeting outcomes for future meetings.
Improvements Betty could make: Clarifying team member roles, ensuring clear notes and action items, managing group dynamics for participation, and ending meetings on time.
SEO Keywords: PDCA model, team dynamics, meeting management
If a factory produces 100 TV sets per year, each TV will be quite expensive to make. However, if a factory produces 20,000 TV sets each year, then it can set up an assembly line with huge machines and workers performing specialized tasks, and the average cost of production per TV will be lower. What is this an example of?
(A) specialization
(B) division of labor
(C) productivity
(D) economies of scale
Answer:
The correct answer is D: economies of scale
Explanation:
Economies of scale are the diminished cost by companies when production becomes efficient. Companies can achieve economies of scale by increasing production and lowering costs. This happens because fixed costs are spread over a larger number of goods. There are implications in variable costs as well (for example in obtaining discounts by large purchases from suppliers). In general, the larger the scale, the more cost savings.
The cost per unit depends on how much the company produces. Larger companies can produce more by spreading the cost of production over a larger amount of goods. Specialization of labor and more integrated technology boost production volumes. Lower per-unit costs can come from bulk orders from suppliers, larger advertising buys, or lower cost of capital. Spreading internal function (for ex: accounting, information technology, and marketing) costs across more units produced and sold helps to reduce costs.
Final answer:
The example described is of economies of scale, where increasing production leads to a lower average cost per unit. This occurs because of a more efficient production process and the spreading of fixed costs over a larger number of units. Hence, it is option D.
Explanation:
The concept described in the question is that of economies of scale. This is when the average cost of production per unit decreases as the level of production increases. For instance, producing 20,000 TV sets instead of just 100 allows a factory to invest in an assembly line, resulting in more automation and workers who can perform specialized tasks more efficiently. This specialized setup effectively reduces the average cost per TV set. Economies of scale happen because the fixed costs are spread over a larger number of units, and the factory can optimize production processes and use resources more effectively.
When considering other choices presented in the student's question, specialization and division of labor are closely related concepts and contribute to economies of scale. Specialization means workers focusing on a particular aspect of production, which enhances their expertise and efficiency. Division of labor is the breaking down of production into steps or tasks, where each worker or group performs a specific role. Together, these contribute to greater overall productivity, but the direct answer to what makes the average cost of production per TV set lower in larger amounts is economies of scale.
Beta coefficients and the capital asset pricing model Personal Finance Problem Katherine Wilson is wondering how much risk she must undertake to generate an acceptable return on her porfolio. The risk-free return currently is 4%. The return on the overall stock market is 14%. Use the CAPM to calculate how high the beta coefficient of Katherine's portfolio would have to be to achieve a portfolio return of 16%.
Answer:
Beta = 1.2
Explanation:
Given:
The risk-free return = 4%
The return on the overall stock market = 14%
The portfolio return to be achieved = 16%
Now,
from capital asset pricing model,
Expected return = Risk-free return + Beta (Market Return - Risk-free return)
on substituting the respective values, we get
16% = 4% + Beta × ( 14% - 4% )
or
12% = Beta × ( 10% )
or
Beta = 1.2
Final answer:
To achieve a portfolio return of 16%, with a risk-free rate of 4% and a market return of 14%, the beta coefficient of Katherine Wilson's portfolio would need to be 1.2.
Explanation:
To calculate the beta coefficient for Katherine Wilson's portfolio using the Capital Asset Pricing Model (CAPM), we need to arrange the CAPM formula to solve for beta:
Expected return = Risk-free return + Beta * (Market return - Risk-free return)
Katherine desires a portfolio return of 16%. Given that the risk-free return is 4% and the return on the overall stock market is 14%, we can plug these values into the formula:
16% = 4% + Beta * (14% - 4%)
To solve for Beta, subtract the risk-free rate from both sides:
12% = Beta * 10%
Now divide by the market premium (10%):
Beta = 1.2
Therefore, the beta coefficient Katherine's portfolio would need to achieve a return of 16% is 1.2.
John works as a quality analyst at a technological firm. He wanted to buy a mobile phone for his wife. Though he was abreast of the latest mobile phone brands that were introduced in the global market, he bought a phone that was produced and marketed locally. He was skeptical about whether global brands deliver high-quality goods. In the context of market segmentation, it is evident that John falls under the segment of _____.
a. global citizens
b. global dreamers
c. antiglobals
d. global agnostics
Answer:
C.
Explanation:
In marketing, when we are analizing the market segmentation we can divide in 4 categories.
Global Citizens and Global Dreamers are both positive toward international brands.
Global Citizens are concerned with corporate responsibility toward local country while Global Dreamers are less concerned.
The global agnostics don’t base decisions on origin of brand.
And the Antiglobals are negative toward international brands. John was skeptical about the quality of the goods because of the origin of the brand.
Which of the following is true of corporations that operate in several different countries? a. Uniformity of tax-laws across different nations result in proper coordination and control of subsidiaries. b. Cash flows in various parts of a multinational corporate system are denominated in one currency. c. A nation may expropriate the assets of multinational corporations without compensation. d. Differences in legal systems of host nations make it easy for executives trained in one country to operate effectively in another. e. Multinational corporations have the advantage of uniform attitudes toward risk taking from one country to the next.
Cash flows in various parts of a multinational corporate system are denominated in one currency.
Explanation:Corporations that operate in several different countries, also known as multinational corporations (MNCs), have certain characteristics.
Out of the given options, the most accurate characteristic of MNCs is b. Cash flows in various parts of a multinational corporate system are denominated in one currency.
This means that the financial transactions within the MNC, such as revenues, expenses, and investments, are conducted using a single currency, which helps in simplifying the financial management of the organization.
Final answer:
The statement that 'A nation may expropriate the assets of multinational corporations without compensation' is the most accurate regarding multinational corporations, which face non-uniform tax laws, operate in multiple currencies, and are subject to diverse legal systems and cultural attitudes.
Explanation:
Among the statements provided, the one that most accurately reflects a reality of multinational corporations (MNCs) is option c, 'A nation may expropriate the assets of multinational corporations without compensation.'
While MNCs do operate across multiple countries and are subject to respective local regulations, tax laws are not uniform across nations, which may lead to complexities and potential for tax optimization by shifting profits to lower-tax jurisdictions. As observed in cases like Netflix International using Luxembourg's favorable tax laws, multinational corporations can leverage different tax regimes to their advantage. However, concerns around such practices have led to scrutiny, and there is a movement towards changing these rules in response to public pressure.
Additionally, cash flows within a multinational corporate system are not denominated in a single currency, but rather in many different currencies. This results in the need for managing exchange rate risks and currency conversions. Lastly, the differences in legal systems across various host nations do not necessarily make it easy for executives to operate effectively abroad, and attitudes toward risk-taking are not necessarily uniform from one country to the next, as cultures and business environments can differ significantly.