Answer:
E. below $14.
Explanation:
The decision for a firm is to shut down when price lower than average variable cost.
Since firms maximizes profit when MC is equal to the market price (P), it implies that MC = P.
Since JL Groomers experiences normal cost curves, with the marginal cost (MC) curve crossing average variable cost (AVC) at $14, this implies that MC = P = AVC at this point.
By implication, JL Groomers will always shut down if the market price is below $14.
The government of Sharonville is deep in debt, and consequently enacts a city ordinance that requires citizens to do volunteer work for the city once per week. Such and act would be in accordance with the __________ school of jurisprudential thought.
Legal Realism
Command
Irrational Forces
Sociological
Law and Economics
the correct answer is Sociological.The ordinance requiring volunteer work is aligned with the Sociological school of jurisprudential thought, which emphasizes laws that address societal needs and promote community welfare.
The government of Sharonville enacts a city ordinance requiring citizens to do volunteer work once per week due to its deep debt. This act aligns with the Sociological school of jurisprudential thought. The Sociological perspective emphasizes that law should reflect and serve societal needs, promoting community welfare, and ensuring that individuals contribute to the common good. By mandating volunteer work, the ordinance aims to address the city's economic challenges through collective citizen effort, resonating with the sociological viewpoint on law and society.
When Crossett Corporation was organized in January 2018, it immediately issued 4,000 shares of $50 par, 6 percent, cumulative preferred stock and 50,000 shares of $20 par common stock. Its earnings history is as follows: 2018, net loss of $35,000; 2019, net income of $125,000; 2020, net income of $215,000. The corporation did not pay a dividend in 2018. Required How much is the dividend arrearage as of January 1, 2019
Answer:
The correct answer is $12,000.
Explanation:
According to the scenario, computation of the given data are as follow:-
Issued Shares = 4,000
Shares Per Value = $50
Percentage of Cumulative Preferred Stock = 6%
We can calculate the Required Dividend Arrearage by using following formula:-
As Of January 1,2019 Arrearage Dividend = Issued Share × Value Of Per Share × % Of Cumulative Preferred Stock
By putting the value, we get
= 4000 × $50 × 6%
= $200,000 × 6/100
= $12,000
A company wants to set up operations in a country with the following corporate tax rate structure: Taxable Income Tax Rate <$50,000 15% $50,000 - $75,000 25% $75,000 - $100,000 34% >$100,000 39% Therefore, a taxable income of $60,000 would result in taxes due of $50,000*0.15 + ($60,000-$50,000)*0.25 = $50,000*0.15 + $10,000*0.25 = $10,000 If the compay expects gross revenues of $400,000, $100,000 in total costs, $60,000 in allowable tax deductions and $12,000 in a one-time business start-up credit, how much should the company expect to pay in taxes?
Answer:
Taxable income = $240,000
Amount payable = $64,850
Explanation:
As per the data given in the question,
Taxable income :
Gross revenue = $400,000
Total cost = $100,000
Net profit = $400,000 - $100,000 = $300,000
Allowable tax deduction = $60,000
Taxable income = $300,000 - $60,000
= $240,000
Tax to be paid :
Computation of tax Amount to be taxed Rate Tax
$50,000 $50,000 15% $7,500
$50,000 to $75,000 $25,000 25% $6,250
$75,000 to $100,000 $25,000 34% $8,500
More than $100,000 $140,000 39% $54,600
Total tax $76,850
Amount payable = Total tax - Tax credit
= $76,850 - $12,000
=$64,850
Beth Corbin’s regular hourly wage rate is $16, and she receives an hourly rate of $24 for work in excess of 40 hours. During a January pay period, Beth works 45 hours. Beth’s federal income tax withholding is $95, and she has no voluntary deductions. Use January 15 for the end of the pay period and the payment date.
Beth Corbin earns a regular hourly wage of $16, with a $24 overtime rate for hours exceeding 40. Working 45 hours in January, her gross pay is $760. After a $95 federal income tax withholding, her net pay is $665.
Beth Corbin earns a regular hourly wage of $16, with an overtime rate of $24 for hours exceeding 40. In January, she works 45 hours. To calculate her gross pay, we determine her regular pay for the first 40 hours and add the overtime pay for the additional 5 hours.
Regular Pay = $16/hour * 40 hours = $640
Overtime Pay = $24/hour * 5 hours = $120
Total Gross Pay = Regular Pay + Overtime Pay = $640 + $120 = $760
Subtracting the federal income tax withholding of $95 gives Beth's net pay.
Net Pay = Total Gross Pay - Federal Income Tax = $760 - $95 = $665
Thus, Beth Corbin's net pay for the January pay period is $665.
Susan is a single mother who can earn $8/hour and work up to 1,800 hours per year. If she earns no income, she will receive $16,000/year in government benefits. Creating a table to show her income based on work hours reveals that her total income is always less than the total income she would receive without working, reducing her incentive to work.
Explanation:Susan is a single mother with three children. She earns $8 per hour and can work up to 1,800 hours per year. If she does not earn any income, she will receive government benefits totaling $16,000 per year. For every $1 of income earned, her government support will be reduced by $1. To understand the impact of this assistance program on Susan's incentive to work, we can create a table:
Based on this table, as Susan earns more income from work, her government support decreases. However, even at the maximum of 1,800 work hours, her total income ($14,400) is less than the total income she would receive without working ($16,000). This assistance program might reduce Susan's incentive to work as her additional income from work doesn't match the reduction in government support.
A binding ruling, issued by the U.S. Bureau of Customs and Border Protection, is issued with regard to: A. Penalties imposed for non-payment of duties owed B. Advance determination of the dutiable status of goods C. Seizure of goods not allowed for import to U.S. D. All of the above
Answer:
D. All of the above
Explanation:
Customs rulings are binding administrative decisions issued by U.S. Customs and Border Protection (CBP) pursuant to 19 C.F.R. Part 177. Rulings may address customs-related matters, including the United States tariff classification, marking, and valuation. CBP may issue such rulings to any importer or exporter of merchandise; to any individual or business entity that has a direct and demonstrable interest in the matters or questions presented in the ruling request; or to an agent (such as an attorney) of either of the aforementioned parties. Rulings may only be prospective and in response to a ruling request.
Merone Company allocates materials handling cost to the company's two products using the below data:
Modular Homes Prefab Barns
Total expected units produced 6500 9500
Total expected material moves 650 250
Expected direct labor-hours per unit 850 350
The total materials handling cost for the year is expected to be $265,500.
If the materials handling cost is allocated on the basis of direct labor-hours, the total materials handling cost allocated to the prefab barns is closest to: (Round your intermediate calculations to 2 decimal places.)
Answer:
Material handling cost allocated to Prefab Barns= $99,750
Explanation:
Activity-based costing is a form of absorption costing where overheads are charged to product using cost drivers.
Under this method, overheads are first analyzed and categorized by the activities responsible for them and then charged to product based on the amount of benefits enjoyed using cost drivers.
Activity rate per driver is calculated as:
Activity overhead for the period / Total cost drivers for the period
Using direct labour hours, the material handling cost can allocated as follows:
Total direct labour hours
(850 ×6500) +(9500×350) =8850000
Material handing cost allocated to Prefab =
(9500×350)/8850000 × $265,500 =$99750
Material handling cost allocated to Prefab Barns= $99,750
Final answer:
The total materials handling cost allocated to the prefab barns, when based on direct labor-hours, is approximately $99,713.35.
Explanation:
To allocate the materials handling cost on the basis of direct labor-hours to the prefab barns, we must follow a series of steps:
Calculate the total direct labor-hours for each product.
Determine the proportion of total direct labor-hours attributable to prefab barns.
Allocate the materials handling cost based on that proportion.
For Modular Homes: 6500 units imes 850 labor-hours = 5,525,000 labor-hours
For Prefab Barns: 9500 units imes 350 labor-hours = 3,325,000 labor-hours
Total labor-hours = 5,525,000 + 3,325,000 = 8,850,000 labor-hours
The proportion for Prefab Barns = 3,325,000 / 8,850,000 = 0.3757 (rounded to four decimal places)
Total materials handling cost for Prefab Barns = 0.3757 imes $265,500 ≈ $99,713.35 (rounded to two decimal places)
Supler Corporation produces a part used in the manufacture of one of its products. The unit product cost is $22, computed as follows: Direct materials $ 7 Direct labor 8 Variable manufacturing overhead 3 Fixed manufacturing overhead 4 Unit product cost $ 22 An outside supplier has offered to provide the annual requirement of 4,700 of the parts for only $15 each. The company estimates that 50% of the fixed manufacturing overhead cost above could be eliminated if the parts are purchased from the outside supplier. Assume that direct labor is an avoidable cost in this decision. Based on these data, the financial advantage (disadvantage) of purchasing the parts from the outside supplier would be:
Answer:
It is cheaper to buy the component.
Financial advantage= $23,500
Explanation:
Giving the following information:
Direct materials $7
Direct labor $8
Variable manufacturing overhead $3
Fixed manufacturing overhead $4
An outside supplier has offered to provide the annual requirement of 4,700 of the parts for only $15 each.
First, we need to calculate the total cost of making the product:
Production in-house:
Total cost= (7 + 8 + 3 + 4)*4,700= 103,400
Buy:
Fixed costs= 2*4,700= 9,400
Buy= 4,700*15= 70,500
Total cost= 79,900
It is cheaper to buy the component.
Financial advantage= 103,400 - 79,900= $23,500
Marx Company has a current production capacity level of 200,000 units per month. At this level of production, variable costs are $0.50 per unit and fixed costs are $0.50 per unit. Current monthly sales are 183,000 units. Heaven Company has contacted Marx Company about purchasing 15,000 units at $1.00 each. Current sales would not be affected by the special order and no additional fixed costs would be incurred on the special order. Marx Company's change in profits if the order is accepted will be:
Answer:
Effect on income= 7,500 increase
Explanation:
Giving the following information:
Variable costs are $0.50 per unit.
Current monthly sales are 183,000 units.
Heaven Company has contacted Marx Company about purchasing 15,000 units at $1.00 each.
Because it is a special offer and there is unused capacity, we will not take into account the fixed costs.
Sales= 15,000*1= 15,000
Variable cost= 15,000*0.5= (7,500)
Effect on income= 7,500 increase
Answer:
Increase of $7,500
Explanation:
Consider the Incremental Costs and revenues arising from acceptance of the offer.
Note : Fixed Costs will not increase as the offer is within the capacity of Marx Company and are therefore irrelevant for this decision.
Sales(15,000×$1.00) $15,000
Less variable costs (15,000×$0.50) ($7,500)
Net Income $7,500
Therefore an increase of $7,500 is expected in profits if Marx Company accepts the order
Johnson Enterprises uses a computer to handle its sales invoices. Lately, business has been so good that it takes an extra 3 hours per night, plus every third Saturday, to keep up with the volume of sales invoices. Management is considering updating its computer with a faster model that would eliminate all of the overtime processing. Current Machine New Machine Original purchase cost $14,700 $25,500 Accumulated depreciation $6,500 _ Estimated annual operating costs $24,900 $19,800 Remaining useful life 5 years 5 years If sold now, the current machine would have a salvage value of $10,400. If operated for the remainder of its useful life, the current machine would have zero salvage value. The new machine is expected to have zero salvage value after 5 years. Prepare an incremental analysis to determine whether the current machine should be replaced.
Solution and Explanation:
The following is the incremental analysis :
Particulars Retain machine Replace machine Net income
Increase / (Decrease)
Operating costs $124500 $99000 25500
($124500 - $99000)
New machine costs - 25500 (25500)
Salvage value (Old) 10400 10400
Total $124500 $114100 $10400 Working notes:
Operating cost of retain machine is calculated by multiplying the estimated operating costs of old machine with the number of years. ($24900 multiply with 5 years = $124500).
Operating cost of replace machine is calculated by multiplying with the estimated operating costs of new machine with the number of years ($19800 multiply with 5 years = $99000).
CONCLUSION: using the old machine or the current machine costs higher than the purchasing of the new machine. Therefore, it is advised to replace the old machine with a new machine to save the cost.
The total Net income is $10400 it is recommended to replace the old machine with a new machine to preserve the cost.
Calculation of Net income:The following is incremental analysis are :
Particulars Retain machine Replace machine Net income
Increase / (Decrease)
Operating costs $124500 $99000 25500
($124500 - $99000)
New machine costs - 25500 (25500)
Salvage value (Old) 10400 10400
Total $124500 $114100 $10400
Working notes:
The operating cost of the retaining machine is calculated by reproducing the calculated operating costs of the old machine by the number of years. ($24900 multiply with 5 years = $124500).
The operating cost of substituting the machine is calculated by multiplying the calculated operating costs of the new machine by the number of years ($19800 multiplied by 5 years = $99000).
CONCLUSION: When using the old machine or the current machine costs are higher than the purchase of the new machine. Thus, it is advised to replace the old machine with a new machine to save the cost.
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https://brainly.com/question/26206936
Suppose Stark Ltd. just issued a dividend of $1.73 per share on its common stock. The company paid dividends of $1.40, $1.47, $1.54, and $1.65 per share in the last four years. If the stock currently sells for $60, what is your best estimate of the company’s cost of equity capital using the arithmetic average growth rate in dividends?
Answer:
Cost of equity = 8.44%
Explanation:
The price of a share can be calculated using the dividend valuation model
According to this model the value of share is equal to the sum of the present values of its future cash dividends discounted at the required rate of return.
The model can be modified to determine the cost of equity
Ke =Do (1+g)/P + g
g- growth rate in dividend, P- current price, D- recent dividend
growth rate = (( Recent dividend /oldest dividend)^1/n - 1)× 100
n- no of years of growth
growth rate = (1.73/1.40)^1/4 - 1 × 100 = 5.4%
Cost of equity = 1.73×(1.054)/60 + 0.054 = 8.44%
Complete the statements about the following three theories for the upward slope of the short-run aggregate-supply curve.
According to the sticky-wage theory, the economy is in a recession because the price level has declined so that real wages are too_____ , thus labor demand is too______ .
According to the sticky-price theory, the economy is in a recession because______ .
According to the misperceptions theory, the economy is in a recession when the price level is_______ what was expected. (fill in the blanks).
Answer:
high,high
not all prices adjust quickly
below
Explanation:
According to the sticky-wage theory, the economy is in a recession because the price level has declined so that real wages are too high, thus labor demand is too high.
Real wages decline as nominal wages are adjusted. As a result, the economy returns to full employment
According to the sticky-price theory, the economy is in a recession because not all prices adjust quickly.
As people observe the lower price level, the economy returns to the long-run aggregate supply curve.
According to the misperceptions theory, the economy is in a recession when the price level is below what was expected.
As people observe the lower price level, their expectations adjust.
Byrd Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 155,000 shares of stock outstanding. Under Plan II, there would be 105,000 shares of stock outstanding and $1.33 million in debt outstanding. The interest rate on the debt is 6 percent and there are no taxes.
a. If EBIT is $200,000, what is the EPS for each plan?
b. If EBIT is $450,000, what is the EPS for each plan?
c. What is the break-even EBIT?
a. Plan I: $1.29, Plan II: $1.16
b. Plan I: $2.90, Plan II: $3.54
c. The break-even EBIT, with an interest rate of 6%, is approximately $221.27.
a. EPS Calculation for EBIT of $200,000:
**Plan I:**
[tex]\[ EPS = \frac{EBIT - Interest}{Number of Shares} \][/tex]
[tex]\[ EPS = \frac{200,000}{155,000} = $1.29 \][/tex]
**Plan II:**
[tex]\[ EPS = \frac{EBIT - (Interest \times (1 - Tax Rate))}{Number of Shares} \][/tex]
Since there are no taxes, the equation simplifies to [tex]\[ EPS = \frac{EBIT - Interest}{Number of Shares} \][/tex]
[tex]\[ EPS = \frac{200,000 - (1.3 million \times 0.06)}{105,000} = $1.16 \][/tex]
b. EPS Calculation for EBIT of $450,000:
**Plan I:**
[tex]\[ EPS = \frac{450,000}{155,000} = $2.90 \][/tex]
**Plan II:**
[tex]\[ EPS = \frac{450,000 - (1.3 million \times 0.06)}{105,000} = $3.54 \][/tex]
c. Break-even EBIT Calculation:
For break-even EBIT, the EPS for both plans are equal:
[tex]\[ \frac{EBIT - \text{Interest}}{155,000} = \frac{EBIT - (1.3 \, \text{million} \times 0.06)}{105,000} \][/tex]
To simplify, we can cross-multiply to eliminate the denominators:
[tex]\[ 105,000 \times (EBIT - \text{Interest}) = 155,000 \times (EBIT - 1.3 \, \text{million} \times 0.06) \][/tex]
Next, distribute and collect like terms:
[tex]\[ 105,000 \times EBIT - 105,000 \times \text{Interest} = 155,000 \times EBIT - 155,000 \times 1.3 \, \text{million} \times 0.06 \][/tex]
Now, isolate the terms involving EBIT:
[tex]\[ 105,000 \times EBIT - 155,000 \times EBIT = - 155,000 \times 1.3 \, \text{million} \times 0.06 + 105,000 \times \text{Interest} \][/tex]
Combine like terms:
[tex]\[ -50,000 \times EBIT = - 155,000 \times 1.3 \, \text{million} \times 0.06 + 105,000 \times \text{Interest} \][/tex]
Finally, solve for EBIT:
[tex]\[ EBIT = \frac{- 155,000 \times 1.3 \, \text{million} \times 0.06 + 105,000 \times \text{Interest}}{-50,000} \][/tex]
Now, plug in the given values:
[tex]\[ EBIT = \frac{- (155,000 \times 1,300,000 \times 0.06) + 105,000 \times \text{Interest}}{-50,000} \][/tex]
Calculate the terms:
[tex]\[ EBIT = \frac{- (11,070,000) + 105,000 \times \text{Interest}}{-50,000} \][/tex]
Now, express the equation without the fraction:
[tex]\[ -50,000 \times EBIT = -11,070,000 + 105,000 \times \text{Interest} \][/tex]
Isolate EBIT:
[tex]\[ EBIT = \frac{-11,070,000 + 105,000 \times \text{Interest}}{-50,000} \][/tex]
Substitute the given interest rate of 6% into the equation:
[tex]\[ EBIT = \frac{-11,070,000 + 105,000 \times 0.06}{-50,000} \][/tex]
Simplify the expression:
[tex]\[ EBIT = \frac{-11,070,000 + 6,300}{-50,000} \][/tex]
[tex]\[ EBIT = \frac{-11,063,700}{-50,000} \][/tex]
[tex]\[ EBIT = 221.274 \][/tex]
Therefore, the break-even EBIT, when the interest rate is 6%, is approximately $221.27.
The question probable maybe:
Byrd Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 155,000 shares of stock outstanding. Under Plan II, there would be 105,000 shares of stock outstanding and $1.3 million in debt outstanding. The interest rate on the debt is 6 percent and there are no taxes.
a. If EBIT is $200,000, what is the EPS for each plan? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
b. If EBIT is $450,000, what is the EPS for each plan? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)
c. What is the break-even EBIT? (Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to the nearest whole number, e.g., 1,234,567.)
a. Plan I $1.29
Plan II $1.16
b. Plan I $2.90
Plan II $3.54
c. Break-even EBIT ???
Exercise 20-19 Budgeted cash payments LO P2 Zisk Co. purchases raw materials on account. Budgeted purchase amounts are: April, $80,000; May, $110,000; and June, $120,000. Payments are made as follows: 70% in the month of purchase and 30% in the month after purchase. The March 31 balance of accounts payable is $22,000. Prepare a schedule of budgeted cash payments for April, May, and June.
Answer:
See explanation section.
Explanation:
P2 Zisk Co.
Budgeted cash payments
For the 2nd quarter
April May June
Accounts payable $22,000
70% in the month of purchase $56,000 $77,000 $84,000
30% in the month after purchase $24,000 $33,000
Budgeted cash payments $78,000 $101,000 $117,000
Total budgeted cash for the 2nd quarter = $296,000.
30% in the month after purchase means 30% amount will be given in the following month.
Final answer:
The student's question involves creating a schedule of budgeted cash payments for a company based on monthly purchases and specified payment terms. The company pays 70% of purchases in the same month and 30% in the following month, with an accounts payable balance carried from March.
Explanation:
The student's question involves preparing a schedule of budgeted cash payments for Zisk Co., which has planned purchases for the months of April, May, and June, with specific payment terms: 70% paid in the month of purchase and 30% paid in the following month. To begin with, we need to consider the existing accounts payable balance from March 31, which amounts to $22,000.
Here's how you can calculate the cash payments for each month:
April: Payments for April purchases (70% of $80,000) plus the carryover balance from March (30% of $22,000).
May: Payments for May purchases (70% of $110,000) plus the remaining amount from April's purchases (30% of $80,000).
June: Payments for June purchases (70% of $120,000) plus the remaining balance from May (30% of $110,000).
Using this approach, you can detail the cash outflows for Zisk Co. and accurately prepare the cash budget.
(8 points) Ehlo Company is a multiproduct firm. Presented below is information concerning one of its products, the Hawkeye. Date Transaction Quantity Price/Cost 1/1 Beginning inventory 3,980 $18 2/4 Purchase 4,000 22 2/20 Sale 4,650 4/2 Purchase 5,250 24 7/17 Purchase 3,100 27 11/4 Sale 6,200.Compute cost of goods sold, assuming Ehlo uses:a. Periodic system, FIFO cost flowb. Perpetual system, FIFO cost flowc. Periodic system, LIFO cost flowd. Perpetual system, LIFO cost flowe. Periodic system, weighted=average cost flowf. Perpetual system, moving-average cost flow
Answer:
k
Explanation:
Periodic FIFO is a cost flow tracking system that is used within a periodic inventory system. In a periodic system, the ending inventory balance is only updated when there is a physical inventory count.
Under first-in, first-out method, the ending balance of inventory represents the most recent costs incurred to purchase merchandise or materials.
Please go to attachment for a step by step explaination of the answer.
A sixminusmonth note receivable for $ 7 comma 000 at 12%, dated October 1, 2020, has accrued interest revenue of ________ as of December 31, 2020. (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)
Answer:
The accrued interest revenue is $210
Explanation:
The period of interest is from 1 October,2020 to 31 December ,2020,which translates into 3 months of interest accrued overall.
The interest accrued can be computed using the formula below:
interest accrued=note receivable amount*interest rate*number of applicable months/12
note receivable amount is $7,000
interest rate is 12%
applicable months is 3
interest accrued=$7,000*12%*3/12
=$210
The accrued interest revenue is $210 as shown above.
The timeline of 3 months is the key to unlocking the question.
The accrued interest revenue on a $7,000 note receivable at 12% interest from October 1, 2020, to December 31, 2020, is $210.
To determine the accrued interest revenue on a note receivable, we need to perform a simple interest calculation with the given interest rate, principal amount, and time period. The formula to compute interest is I = PRT, where I is the interest, P is the principal amount, R is the annual interest rate expressed as a decimal, and T is the time period in years.
In this scenario, the principal amount (P) is $7,000, the annual interest rate (R) is 12%, and the time period (T) from October 1, 2020, to December 31, 2020, is 3 months or 0.25 years. Thus, the calculation would be:
P = $7,000R = 12% or 0.12 (as a decimal)T = 3/12 or 0.25 (as a year fraction)I = PRT = $7,000 × 0.12× 0.25 = $210
The accrued interest revenue as of December 31, 2020, would be $210. As the question requests, this amount is rounded to the nearest dollar.
In the video, Mike Boyle says he has read that meeting with employees regularly is important to motivation. Although he and Bob hold weekly staff meetings with their employees, Mike believes they should meet more often. He knows that employee meetings should have a purpose, and he asks you for advice. To make sure meetings are motivational for employees, what should be discussed?
Answer:
A meeting should have a specific time limit. Within that time limit, only a several amount of topics should be discussed as more focused the topics will be, the more effective the meeting will be.
In these meetings, the employers must make a platform for the employees to present the challenges and difficulties they face over the course of their work. This way, many problems can be identified and solved effectively.
Moreover, employees grievances must be discussed as well.
Explanation:
Employee meetings should focus on performance appraisals, career development, and open feedback discussions to be motivational. Building a strong manager-employee relationship and translating meeting outcomes into actionable plans are also key for meeting effectiveness.
Explanation:To ensure that employee meetings are motivational and effective, several key topics should be discussed. First, performance appraisals should be on the agenda, allowing for a structured evaluation of an employee's work performance, which may involve discussing job responsibilities and setting goals for future improvement. This process should be based on original job analysis and relevant objectives.
Another topic is career development, where employees' paths within the company are explored, including skills development and growth opportunities. This could be broken down into specific time frames for milestones and goals, as suggested in their first year on the job. Thirdly, meetings should include open feedback discussions where employees have the chance to communicate their perceptions of the work environment, express concerns, and provide suggestions for improvement in a confidential and trusting setting.
Furthermore, the aspect of the manager-employee relationship cannot be overstated. Managers can enhance this relationship by understanding and addressing what motivates and frustrates their employees, thus promoting a collaborative work atmosphere. Lastly, it is crucial for both parties to translate the outcomes of these meetings into actionable plans, with employees taking initiative to work on identified weaknesses and managers working eficiently to aid their team's development.
Suppose the S&P 500 index is currently 950 and the initial margin is 10%. You wish to enter into 10 S&P 500 futures contracts. a. What is the notional value of your position? What is the margin? b. Suppose you earn a continuously compounded rate of 6% on your margin balance, your position is marked to market weekly, and the maintenance margin is 80% of the initial margin. What is the greatest S&P 500 index futures price 1 week from today at which you will receive a margin call?
Final answer:
The notional value of entering into 10 S&P 500 futures contracts with an index at 950 is $2,375,000, and the initial margin is $237,500. A margin call would occur if the futures price drops significantly in a week, considering a 6% continuously compounded interest rate on the margin balance and an 80% maintenance margin requirement.
Explanation:
The question involves calculating the notional value and initial margin for entering into S&P 500 futures contracts and determining the futures price at which a margin call would occur given certain conditions.
a. Notional Value and Initial Margin
The notional value of a futures contract is the value of the underlying asset represented by the contract. With the S&P 500 index currently at 950 and the intention to enter into 10 contracts, the notional value would be 950 (index value) * 10 (number of contracts) * $250 (standard contract size for S&P 500 futures), totaling $2,375,000. The initial margin, being 10% of this value, equates to $237,500.
b. Margin Call Price
With weekly mark-to-market and a maintenance margin set at 80% of the initial margin, the margin balance would need to be at least $190,000 (80% of $237,500). Assuming a continuously compounded interest rate of 6% on the margin balance, the account value would grow to approximately $240,113.29 in one week. To avoid a margin call, the futures price should not drop to a level where the equity in the account falls below the maintenance margin requirement, considering gains from interest.
Sam agrees to buy and Meranda agrees to sell 1000 lbs of bananas actually worth $5000, but they have not agreed on the price yet. Details are finalized, and part of their agreement is that the exact price of the bananas will be determined in the future. Later, they are unable to agree on a price.
a) Since this transaction is covered by the UCC, is there a contract for the sale and, if so, what would the court say is the price, and on what basis?
b) If the sale were not bananas but involved the agreement to repair several air conditioners in an apartment building, how would a court handle this agreement? Would it enforce it?
a. There is a contract for the sale of the bananas because UCC allows to keep certain terms open while contracting, which includes price. If the parties are not clear on the price or the price is to be set over time, the parties can fill the term later under UCC. Hence the agreement between Sam and Meranda for the sale of bananas constitutes a valid contract. If the parties are unable to determine the price, court will determine a reasonable price based on the fair market value or the intention of the parties while making the contract and by using the most reasonable method as per the business practices. Here 1000 lbs of bananas actually worth $5000. Hence the court may decide the price to be $5000 or determine the price by analyzing the intention of the parties while making the contract.
b. If the agreement was to repair several air conditioners in an apartment building, it does not come under UCC because UCC governs only contracts for sale of goods. Service contracts are governed by common law of contracts and price is necessary to form a valid contract. Hence the court will rule the contract as invalid and would not enforce the contract.
Refer to the HR Reports in the Inquirer. Through past investments in recruiting and training Digby has obtained a productivity index of 109.4%. This means that Digby's labor costs would be increased by 9.4% if it did not have these productivity improvements. This is a competitive advantage that Digby can sustain or even widen further if its competitors have no HR initiatives. Now, refer to the Income Statement in Digby's Annual Report. How much did Digby's productivity improvements save it in direct labor costs (in thousands) last year
Answer:
$ 3,063.
Explanation:
Saving in labor cost last year = Labor cost during current year * Increase in labor cost during current year.
= 32584 * 9.4 %
= $ 3,063
Conclusion :- Option a). $ 3,063. (This amount of $ 3063 increase in labor costs during current year as compared to last year represents to saving in labor costs during the last year i.e., Labor costs were less / short by $ 3063 during the last year).
Kindly note that this solution was arrived at based on the information that is available to me.
The direct labor cost is the cost incurred over the labor or employees for producing the goods or providing the services. There is a direct relationship between the productivity and direct labor cost.
The saving amount of direct labor cost for improving the productivity is $3,063.
Computation:
Given:
Labor cost of current year =$32,584
Percentage increase in labor cost =9.4%
[tex]\begin{aligned}\rm{Saving in labor cost last year}& = \rm{Labor \;cost\; during\; current\; year}\times\\& \rm{Increase \;in \;labor \;cost \;during \;current \;year}\\&= \$32,584 \times9.4 \%\\&= \$ 3,063\end{aligned}[/tex]
Therefore, $3,063 is the in the direct labor cost as compared to the previous year. Thus, last year the labor cost was short by $3,063.
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Videoworld is a discount store that sells color televisions. The monthly demand for color television sets is 100. The cost per order from the manufacturer is $600. The carrying cost is $64 per set each year. Assume a year has 360 working days. Determine the following values rounding to the nearest integer (answer them using only numbers without any sign such as the dollar sign, comma, ...): Q1. The optimal quantity per order: Q2. The minimum total annual inventory costs: Q3. The optimal number of orders per year: Q4. The optimal time between orders (in working days): If the store had an inventory policy that allows shortages with the shortage cost per set estimated at $80, determine the following values:
Complete question:
Videoworld is a discount store that sells color televisions. The monthly demand for color television sets is 100. The cost per order from the manufacturer is $600. The carrying cost is $64 per set each year. Assume a year has 360 working days. Determine the following values rounding to the nearest integer (answer them using only numbers without any sign such as the dollar sign, comma, ...):
Q1. The optimal quantity per order: Q2. The minimum total annual inventory costs:
Q3. The optimal number of orders per year:
Q4. The optimal time between orders (in working days):
If the store had an inventory policy that allows shortages with the shortage cost per set estimated at $80, determine the following values:
5) The optimal quantity per order when the store allows shortages
6) The optimal storage level when the store allows shortages
7) The optimal number of orders when the store allows shortages
8)The optimal time between orders (in working days) when the store allows shortages.
Answer:
1) 150
2) $4,800
3) 8
4) 45 days
5) 201
6) 89
7) 6
8) 60 days
Explanation:
We are given:
Monthly demand, = 100
Cost per order, S= $600
Carrying cost, H = $64 per set/ year
Shortage cost, Cs = $80
Yearly demand will be, D= 100*12 =1200
1) The optimal quantity per order:[tex] (Q*) = \sqrt{\frac{2*D*S}{H}} [/tex]
[tex] = \sqrt{\frac{2*1200*600}{64}} [/tex]
[tex] = \sqrt{22500} = 150 [/tex]
2) The minimum total annual inventory cost:
Average inventory * H
Where average inventory = Q*/2
[tex] = \frac{150}{2} = 75 [/tex]
Therefore,
Average inventory * H
= 75 * 64
= $4,800
3)The optimal number of orders per year:
[tex] = \frac{D}{Q*} = \frac{1200}{150} = 8[/tex]
4) The optimal time between orders:
[tex] = \frac{360}{8} = 45 days [/tex]
5)The optimal quantity per order when the store allows shortages:
[tex] Q= \sqrt{\frac{2*D*S*(H+Cs)}{H * Cs} [/tex]
[tex] = \sqrt{\frac{2*1200*600*(64+80)}{64 * 80} [/tex]
= 201.25 ≈ 201
6) The optimal shortage level when the store allows shortages:
[tex] = \frac{Q* H}{H* Cs} [/tex]
[tex] = \frac{201 * 64}{64* 80} [/tex]
= 89.33 ≈ 89
The optimal shortage level when the store allows shortages = 89
7) The optimal number of orders per year when the store allows shortages:
No. of orders =
[tex] \frac{D}{Q} = \frac{1200}{201} [/tex]
= 5.97 ≈ 6
Optimal number of orders per year = 6
8) The optimal time between orders (in working days) when the store allows shortages:
Time between orders = Number of working days/ Number of orders
[tex] = \frac{360}{6} = 60 [/tex]
The optimal time between orders (in working days) = 60 Days
burnett corp. pays a constant $7.40 dividend on its stock. the company will maintain this dividend for the next 8 years and will then cease paying dividends forever. If the required return on this stock is 12 percent, what is the current share price
Answer:
The correct answer is $36.778.
Explanation:
According to the scenario, the given data are as follows:
Dividend = $7.40
Time period (t) = 8 years
Return required (r) = 12%
So, we can calculate the current share price by using following formula:
Current share price = Dividend × Present value of annuity for 8 years
Where, Present value of Annuity for 8 years = = (1 - (1+r)^-t) ÷ r
= (1 - (1+12%)^-8) ÷ 12%)
= (( 1 - 0.40388322797) ÷ 0.12)
= $4.967639766916667 or $4.97
So, by putting the value, we get
Current share price = $7.40 × $4.97
= $36.778
Suppose that a cafe enjoys a large increase in customers whenever the jazz club next door features a band playing appealing music because it can be easily heard from the cafe. The jazz club owner decides to purchase the cafe so that he can internalize this positive externality. Which of the following types of private solutions to the externality of appealing music has occurred in this case?
a. Contracts
b. Charities
c. Moral codes and social sanctions
d. Integration of different types of businesses through merger or acquisition
Answer:
D. Integration of different types of businesses through merger or acquisition
Explanation:
Externalities occur when the production or consumption of a particular good or service affects a third-party who is not related to the transaction. A positive externality is one that is favorable and beneficial to the third party and a negative externality is one that is unfavorable and creates a cost to the third party. In this case, the third party is the owner of the cafe and it is a positive externality because the music creates an increase in the number of customers to his/her business.
When the jazz club owner purchases/acquires the cafe, the cafe becomes his. Hence, the benefit felt to the cafe by the music from the jazz club is a benefit that his own new business incurs. Thus, the integration of these two businesses into one helps internalize the positive externality since now the main party involved in the transaction is also the one feeling the positive externality and not a third-party as used to be.
The jazz club owner has internalized the positive externality by purchasing the cafe, representing a private solution of integration through merger or acquisition.
Explanation:In the scenario provided, the cafe experiences a positive externality from the jazz club's music, which leads to an increase in customers when appealing music is played. The jazz club owner decides to internalize this positive externality by purchasing the cafe, so that he can benefit directly from the increased customer flow that the music provides to the cafe. This type of private solution to the externality of appealing music is an example of integration of different types of businesses through merger or acquisition. This move ensures that the benefits associated with the music are fully captured by the jazz club owner, now owner of both establishments, and is a textbook example of a business solution to manage externalities.
Gabrielle is the chief marketing officer of Boyd Pharmaceuticals. She is meeting with Trent, the chief financial officer to decide on the company's marketing communications budget. They decide to trust in the prevailing collective wisdom of the industry as a whole, and not wanting to instigate a communications war, settle on spending only as much as their nearest market rival does on marketing communications. What method did Gabrielle and Trent use to arrive at the marketing communications budget
Answer:
The correct answer is letter "C": competitive-parity method.
Explanation:
The competitive-parity method is the marketing approach in which companies simply adopt the same advertisement strategy its competitors incorporate in an attempt of reducing costs. No major research is conducted implementing this practice since entities limit themselves to follow the current marketing trend.
Incorporating similar advertisement approaches in most cases takes companies to allocate for it the same amount of money than rivals.
You deposit $5,000 per year at the end of each of the next 25 years into an account that pays 8% compounded annually. What will be the value of the account in 25 years, rounded to the nearest dollar
Answer:
future value = $365529.69
Explanation:
given data
deposit = $5,000
time period = 25 years
compounded annually = 8%
solution
we get here future value that is express as in excel by formula that is
=FV(rate;NPER; PMT)
here NPER is 25 and PMt is -5000
and rate is 8%
put value and we get
future value = $365529.69
Buker Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year. Data for the upcoming year appear below: Estimated machine-hours 72,500 Estimated variable manufacturing overhead $3.10 per machine-hour Estimated total fixed manufacturing overhead $838,790 The predetermined overhead rate for the recently completed year was closest to:
Answer:
$11.57 per machine hour
Explanation:
Predetermined overhead rate is used to allocate overheads (indirect) to products / jobs or departments.
Predetermined overhead rate = Budgeted Fixed Costs / Budgeted Activity
Note : Buker Corporation bases its predetermined overhead rate on the estimated machine-hours for the upcoming year.
Predetermined overhead rate = $838,790/ 72,500
= $11.57 per machine hour
After combing through the data, you have noticed that firms hiring Fishergraduates earn average abnormal returns of 3% per year over the next few years. You are convinced that this is a genuine profit opportunity and so have decided to trade on it. You have $10,000 to invest and two options: (1) invest all $10,000 in one company that has just hired a Fisher graduate; (2) invest $1,000 in each of ten companies that have just hired Fisher graduates. Which choice is preferable, or does it not matter?
Answer:
option (2)
Explanation:
That's right, but what if all $ 10,000 was invested in a company and it didn't come out much? The probability of earning an extraordinary income increases. It is also dangerous. This is because there is a 50% probability that the company will perform better. Therefore it is advisable to invest 1,000 companies in ten companies. Thereby reducing the risk. Well, diversification not only reduces risk but also increases the chances of profit.
The following information is available for Amos Company for the year ended December 31, 2017. Balance of retained earnings, December 31, 2016, prior to discovery of error, $859,000. Cash dividends declared and paid during 2017, $29,000. It neglected to record 2015 depreciation expense of $37,600, which is net of $6,900 in tax benefits. The company earned $223,000 in 2017 net income. Prepare a 2017 statement of retained earnings for Amos Company. (Amounts to be deducted should be indicated with a minus sign.)
Answer:
Amos Company
Statement of retained earning
as on December 31, 2017
Retained Earning December 31, 2016 $859,000
Add: Net Income for 2018 $223,000
Dividend -$29,000
Prior years error adjustment -$37,600
Retained Earning December 31 $1,015,400
Explanation:
Retained Earning is an equity account and its balance is credit in nature. It is the accumulated balance of all the prior year's income / losses after paying all the dividend. This balance can be used for the dividend payment or reinvestment in the business.
Omission of depreciation expense understated the expenses for the year and overstated the profit of 2015, which ultimately overstated the retained earning value. we need to adjust this error in retained earning balance because it is adjustment of an prior year error, it will not be included in the current years net income calculations. It already netted off so we just simply adjust it in the retained earning with the value of $37,600.
Read the following letter and help Shady Slim with his tax situation. Please assume that his gross income is $172,900 (which consists only of salary) for purposes of this problem.
December 31, 2015
To the friendly student tax preparer:
Hi, it’s Shady Slim again. I just got back from my 55th birthday party, and I’m told that you need some more information from me in order to complete my tax return. I’m an open book! I’ll tell you whatever I think you need to know.
Let me tell you a few more things about my life. As you may recall, I am divorced from my wife, Alice. I know that it's unusual, but I have custody of my son, Shady, Jr. The judge owed me a few favors and I really love the kid. He lives with me full-time and my wife gets him every other weekend. I pay the vast majority of my son's expenses. I think Alice should have to pay some child support, but she doesn't have to pay a dime. The judge didn't owe me that much, I guess.
I had to move this year after getting my job at Roca Cola. We moved on February 3 of this year, and I worked my job at Roca Cola for the rest of the year. I still live in the same state, but I moved 500 miles away from my old house. I left a little bit early to go on a house-hunting trip that cost me a total of $450. I hired a moving company to move our stuff at a cost of $2,300. Junior and I got a hotel room along the way that cost us $45 (I love Super 8!). We spent $35 on meals on the way to our new home. Oh yeah, I took Junior to a movie on the way and that cost $20.
Can you believe I’m still paying off my student loans, even after 15 years? I paid a total of $900 in interest on my old student loans this year.
Remember when I told you about that guy that hit me with his car? I had a bunch of medical expenses that were not reimbursed by the lawsuit or by my insurance. I incurred a total of $20,000 in medical expenses, and I was only reimbursed for $11,000. Good thing I can write off medical expenses, right?
I contributed a lot of money to charity this year. I’m such a nice guy! I gave $1,000 in cash to the March of Dimes. I contributed some of my old furniture to the church. It was some good stuff! I contributed a red velvet couch and my old recliner. The furniture is considered vintage and is worth $5,000 today (the appraiser surprised me!), even though I only paid $1,000 for it back in the day. When I contributed the furniture, the pastor said he didn’t like the fabric and was going to sell the furniture to pay for some more pews in the church. Oh well, some people just have no taste, right? Roca Cola had a charity drive for the United Way this year and I contributed $90. Turns out, I don’t even miss it, because Roca Cola takes it right off my paycheck every month . . . $15 a month starting in July. My pay stub verifies that I contributed the $90 to the United Way. Oh, one other bit of charity from me this year. An old buddy of mine was down on his luck. He lost his job and his house. I gave him $500 to help him out.
I paid a lot of money in interest this year. I paid a total of $950 in personal credit card interest. I also paid $13,000 in interest on my home mortgage. I also paid $2,000 in real estate taxes for my new house.
A few other things I want to tell you about last year. Someone broke into my house and stole my kid's brand new bicycle and my set of golf clubs. The total loss from theft was $900. I paid $100 in union dues this year. I had to pay $1,000 for new suits for my job. Roca Cola requires its managers to wear suits every day on the job. I spent a total of $1,300 to pay for gas to commute to my job this year.
Oh, this is pretty cool. I've always wanted to be a firefighter. I spent $1,000 in tuition to go to the local firefighter's school. I did this because someone told me that I can deduct the tuition as an itemized deduction, so the money would be coming back to me.
That should be all the information you need right now. Please calculate my taxable income and complete pages 1 and 2 of Form 1040 (through taxable income, line 43) and Schedule A. You're still doing this for free, right?
Can you calculate the taxable income?
The taxable income that Shady Slim would have from this tax situation is: $144,210.
What is the taxable income?Taxable income is the amount that should be legally remitted to the government after subtracting expenses. The formula for taxable income is:
Taxable Income = Gross Income - (Moving Expenses + Student Loan Interest + Charitable Contributions + Interest Expenses + Theft Loss + Union Dues + Work-Related Expenses + Tuition)
So, when we account for gross income and the expenses by Shady Slim, we would have the taxable income as:
Taxable Income = $172,900 - ($2,850 + $900 + $6,590 + $13,950 + $900 + $100 + $2,300 + $1,000)
= $172,900 - $28,690
= $144,210
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Shady Slim's taxable income is calculated by subtracting his eligible itemized deductions from his adjusted gross income (AGI). His AGI is $172,900, and the eligible deductions total up to $35,740. Thus, his taxable income is $137,160.
Explanation:Shady Slim's adjusted gross income (**AGI**) is $172,900, his total salary. This is important as it is the starting point for determining his tax situation.
The **itemized deductions** that Shady can claim are:
$1,250 for student loan interest ($900 is the max without considering other factors such as income, with $2,500 the overall limit if all conditions are met) $9,000 medical and dental expenses ( only the portion that exceeds 10% of AGI is deductible which is $20,000 - $11,000 - ($172,900 * 10%) = $9,000) $6,090 charitable contributions (cash to church + fair market value of donated goods + money given to friend + money donated through employer) $15,950 for mortgage interest and real estate taxes $1,000 for theft loss $1,000 for union dues $450 for moving expenses (house-hunting cost)
Total deductions: $35,740.
It's notable that the tuition paid for firefighter’s school and wardrobe expenditure for his job cannot be claimed as Shady's profession is not firefighting and clothing that is suitable for everyday wear even if it’s required for work is not deductible
Shady Slim's taxable income: $172,900 (AGI) - $35,740 (itemized deductions) = $137,160.
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Glenville Company has the following information for April: Cost of direct materials used in production $50,000 Direct labor 56,000 Factory overhead 35,000 Work in process inventory, April 1 39,000 Work in process inventory, April 30 34,000 Finished goods inventory, April 1 25,000 Finished goods inventory, April 30 17,000 a. For April, determine the cost of goods manufactured. Using the data given, prepare a statement of Cost of Goods Manufactured.
Answer and Explanation:
The preparation of Cost of Goods Manufactured is shown below:
Glenville Company
Statement of Cost of Goods Manufactured
Work in progress inventory April, 1 $39,000
Cost of direct materials used in production $50,000
Direct labor $56,000
Factory overhead $35,000
Total manufacturing cost incurred in April $141,000
Total manufacturing cost $180,000
Work in progress inventory April, 30 $34,000
Cost of goods manufactured $146,000
($180,000 - $34,000)
Perez Corporation has 100,000 shares of $1 par value common stock and 20,000 shares of 8% cumulative preferred stock, $100 par value, outstanding. The balance in Retained Earnings at the beginning of the year was $1,600,000, and one year's dividends were in arrears. Net income for the current year was $870,000.
If Perez Corporation paid a dividend of $2 per share on its common stock, what is the balance in Retained Earnings at the end of the year?
a. $2,150,000.
b. $2,270,000.
c. $2,110,000.
d. $1,950,000.
Answer:
Option D is correct,$1,950,000
Explanation:
In order to compute the closing balance of retained earnings, the preferred shares dividends for prior and current years as well as the common stock dividend must be deducted from net income before adding the remnant to the opening retained earnings:
Net income $870,000
Preferred dividend prior year($100*20000*8%) ($160,000)
Preferred dividend current year($100*20000*8%) ($160,000)
Common stock dividend($2*100,000) ($200,000)
net income after dividends $350,000
Closing retained earnings=$1600,000+$350,000
=$1,950,000
Answer:
D. $1,950,000
Explanation: