Lean Accounting

The annual budgeted conversion costs for a lean cell are $180,000 for 2,000 production hours. Each unit produced by the cell requires 18 minutes of cell process time. During the month, 550 units are manufactured in the cell. The estimated materials costs are $32 per unit. Provide the following journal entries:

a. Materials are purchased to produce 600 units.

b. Conversion costs are applied to 550 units of production.

c. 500 units are completed and placed into finished goods.

a. Raw and In Process Inventory
Accounts Payable
b. Raw and In Process Inventory
Conversion Costs
c. Finished Goods Inventory
Raw and In Process Inventory

Complete Question:

Frito•Lay's Quality•Controlled Potato Chips Frito-Lay, the multi-billion-dollar snack food giant, produces billions of pounds of odic( every year at its downs of US. and Canadian plants. From the fanning of potatoes—I brida, Moral Carolina, and Michigan—b factory and to retail stores, the ingredients and final product of Lay's chips, for example, are respected at least 11 Ines: h the field, before tnbadhg at the plant, after washing and peeling, at the sizing station, at he fryer, after seasoning, when bagged (for weight), at carton filling, h the warehouse, and as they are placed on the store shelf by Frib-Lay personnel. Similar inspections take place for ib other famous products, including Cheetos, Fritz, Ruffles, and Tostibs. In addition to these employee inspections, the firm uses proprietary vision systems to look for defective potato clips. Chips are pulled off the high-speed line and checked twice if he visits system senses them to be to brown. lire company follows the very strict standards of the American Institute of Baling (AIB), standards that are much tougher than those of the US. Food and Drug Administration. Two warnourted AIB site visits per year keep Frito-Lay's plants cn their toes. Scores, consistently in the "excellent' range, are posted, and every employee knows exactly how the plant is doing. There are two key metrics in Frito-Lay's continuous improvement quality program: (1) total customer complaints (measured on acomplabb per million bag basis) and (2) horror daily statistical process control scores (far oil, moisture, seasoning, and salt content, for chip thickness, for fryer temperature, and for weight). In the Florida plant, Angela McCormack, who holds engineering and MBA degrees, oversees a 16-member quality assurance staff. They watch all aspects of quality, including trailing employees on the factory floor, monitoring automated processing eq.ibment, and developing and updating statistical process control (SPC) charts. The upper and lower control limits for one checkpoint, salt content in Lay's chips, are 2.22% and 1.98%, respectively. To see exactly how these limits are created using SPC, watch the vkleco that accompanies this case. Angela is now gonged b evaluate a new salt process delivery system and wants to Prow if the per and bv.er control limits at 3 standard deviations for the new system will meet the upper and lower control specifications noted above. the data (in percents) from the initial trial samples ae:

Sample 1:1.98, 2.11, 2.15, 206

Sample 2: 1.99, 2.0, 208, 1.99

Sample 3: 2.20, 2.10. 220, 205

Sample 4: 2.18, 2.01, 223, 1.98

Sample 5: 2.01, 2.08, 2.14, 216

Provide the report to Angela  

Answer and explanation:

check the attached file for comprehensive step by step solution

The mean of each sample was calculated and then used to determine an overall mean, which was then utilized to compute upper and lower control limits. The standard deviation was incorporated into this calculation. The computed control limits were recommended for comparison with the system's specifications.

To evaluate the new salt process delivery system, we will first calculate the mean of each sample, and then calculate the overall mean. When we have the overall mean, we can compute the upper and lower control limits.

The overall mean is then (2.075 + 2.015 + 2.1375 + 2.10 + 2.0975)/5 = 2.085

Using the formula for control limits, which is mean ± (3 × standard deviation), and given the standard deviation is 0.07, the upper control limit will be 2.085 + (3 × 0.07) = 2.295 and the lower control limit will be 2.085 - (3 × 0.07) = 1.875. Angela should compare these control limits with the system's specifications.

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Answer: Start = $300 million

End = $318.59 million

Explanation:

NAV can be calculated by dividing the funds Assets net of Liabilities by the total number of outstanding shares.

At start of the year NAV is $300 million and NAV per share is therefore,

= 300 million/ 10 million

= $30 per share.

Ending NAV

During the year the fund made Investments and increased by a price of 7%

= 300 million (1 + 0.07)

= $321 million

We still have to subtract the 12b-1 fees that the fund charges though and that would result in,

= 321 million * (1 - 0.0075)

= 318.5925

= $318.59 million.

Dividing this by the total number of outstanding shares we have,

= 318.59 /10

= $31.86

$31.86 is the NAV per share at year end.

Answer:

The answer is D) None of these statement is relevant in the decision to further process the cream into butter.

Explanation:

option A)  the amount paid to the farmers to purchase the unprocessed milk: this information is not relevant to further develop the cream and low fat milk to butter. It was already considered before this stage of production.

Option B) the cost of breaking down the unprocessed milk into cream and low-fat milk: this cost was already accounted for since the processing into cream and low fat milk is completed.

Option C) the portion of corporate fixed expenses that are currently being allocated to cream: This information is not going to help in the decision making for further processing.

Answer: False

Explanation:

This seems to me like a True or False question and the answer would be False.

Payback period is calculated on the basis of the timing of cash flows and since we do not know the useful life of Project B neither do we know the timing of it's cash flows, we cannot say for certain that Project A has a shorter Payback period.

For example, the initial investment could be $5 million for instance but Project A only pays $10 million on its 5th year whereas Project B had a useful life of 4 years and paid $2 million each of those years. Meaning it would have paid back before the end of the 3rd year.

If you need any clarification do react or comment.

Answer:

25%

Explanation:

Given: Sales= $10,000,000

           Cost of goods sold= $5000000.

           Pre-tax earning= $500000.

           Merchandise inventory= $80000.

           Total assets= $2000000.

Now, computing the value of return on assets.

Formula; [tex]Return\ on\ assets= \frac{Net\ income}{Average\ total\ assets} \times 100[/tex]

⇒ [tex]Return\ on\ assets= \frac{500000}{2000000} \times 100[/tex]

⇒ [tex]Return\ on\ assets= 0.25 \times 100[/tex]

∴ Return on assets= [tex]25\%[/tex]

Hence, Flinger´s return on assets is 25%

Answer:

The price of the stock today is $40.39

Explanation:

The price of the stock today can be calculated using the constant growth model of the DDM approach. The constant model is used whenever the expected dividend is expected to grow at a constant rate forever. The formula for price today is,

P0 = D1 / r -g

Where we use D1 that is dividend expected for the next year to calculate price today. As the company will pay dividend in the year 5 that is  D5, we will calculate the price using this model that will be price at Year 4 and dicount it back for 4 years to calculate the price today.

P0 = [4.8 / (0.111 - 0.033)] / (1+0.111)^4

P0 = $40.39

The price of the stock today for New Gadgets, Inc., given the provided parameters and using the Gordon Growth Model for calculation, equates to approximately $18.81 per share.

The subject of your question pertains to the field of finance, and more specifically, the calculation of the inherent value of a company's stock. For the case of New Gadgets, Inc., we should apply the Gordon Growth Model (a variant of the Dividend Discount Model) to determine the current price of the stock. With the specification that the firm starts paying dividends in the 5th year, we discount this future dividend using the formula for the present value of growing perpetuity: P = D / (r - g), where D represents the amount of the dividend ($4.80); r the required return (11.1%), and g the growth rate of dividends (3.3%). However, since the first dividend will only be paid in 5 years, we must discount this derived price for the additional years (in this case, 5 years) at the required return. The formula becomes: P = D / ((1 + r) ^ n * (r - g)) which simplifies to P = $4.80 / ((1 + 0.111) ^ 5 * (0.111 - 0.033)). After doing the math, the computed price of the share today comes out to be around $18.81.

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Answer:

American feel their democracy is the best based on his uniqueness and authenticity with respect to political institution, parties and interest groups.

The house of congress will not be the same if there is only on single chamber for a common ground for discussion and the coming together of legislative in one chamber

In the legislative house, there consist of both the upper and lower houses, who makes laws and institutes the constitutional execution for the benefit of the nation.

Explanation:

American Politics in Comparative Perspective: American have the believe that their democracy is the best in terms of uniqueness and authenticity than other countries of the world. with this they feel they have put a tremendous amount of work for their democracy to be the best in the world. The people of America thinks in regarding the areas of political institution, culture, interest group, political parties it is unique.

In the Legislative house, there are two houses which are, the upper legislative house and the lower legislative house.

The Congress would not be the same if only there is a single chamber that will have a common ground  for discussion and the assembly of the legislative will be put in the single chamber only. the two l houses of legislation have a different methods to meet the compliance of the constitution. If the single chamber is available, then there will be an approach common for all the legislative processes and legislature will be taken away from the single chamber only.

Under an institutional configuration losers will be with the winners in the house and they will implement  the constitutional drives in the house and make sure the nation meets its constitutional implementation  for benefit of the nation

A single-chamber Congress would facilitate faster decision-making, benefiting the political majority. However, it could also lead to unchecked legislation and disadvantage minority interest groups due to a reduced system of checks and balances.

If the Congress only consisted of a single chamber, meaning a unicameral system, the legislative process can become faster and more efficient as the entire institution would operate unilaterally. This configuration might streamline decision-making and eliminate inter-chamber disagreements which can slow down legislation. However, this framework could also reduce the checks and balances principle inherent in a bicameral system, potentially leading to more unchecked or unbalanced legislation.

The 'winners' in this case could be the political majority or the party in control of the legislature, as they would gain the ability to pass laws more quickly with fewer roadblocks. 'Losers,' on the other hand, could be the political minority or smaller interest groups. Such groups would have less opportunity to influence legislation because their ideas would be less likely to be considered with the absence of a second chamber to offer a secondary review or counterargument.  

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Answer:

6.83%

Explanation:

The computation of the accounting rate of return is shown below:

As we know that

Average accounting rate of return = Average annual operating income ÷ Initial Investment

where,

Average annual operating income is

Year 1 net cash inflow           $320,000

Year 2 net cash inflow          $280,000

Years 3-10 ($230,000 × 8)    $1,840,000

Total net cash flows                $2,440,000

Less: Total depreciation      ($1,450,000)

                                              $990,000

Divided it by years of life         ÷ 10  years

Average annual operating income $99,000

So,

Average accounting rate of return is

= $99,000 ÷ $1,450,000

= 6.83%

Answer:

The correct answer is letter "A": advertising.

Explanation:

Advertising has been the most common form of publishing job offerings. Mostly, companies use newspapers to post new job opportunities but other mediums of information such as radio or television are also utilized. Though, nowadays most recruiters are increasing the use of social media platforms like LinkedIn to capture prospective employees.

Final answer:

Advertising in traditional media like newspapers and industry publications is a key method for firms to communicate job opportunities. The rise of the internet and sites like LinkedIn has made job seeking easier, but a mix of active and passive job search strategies is recommended for best results.

Explanation:

The traditional recruitment method that communicates a firm's employment needs to the public through media such as newspapers and industry publications is known as advertising. This method is a key component of what's often called the 'visible job market', wherein employers actively seek to fill positions by making them known to a wide audience. In contrast, the 'invisible' or 'hidden job market' requires a more proactive approach from job-seekers, such as networking, to uncover opportunities that aren't publicly advertised.

With the rise of the internet, many employers have shifted towards online platforms to post job opportunities. Company websites often feature an Employment or Careers section where these opportunities are listed. Furthermore, social media and professional networking sites, like LinkedIn, have revolutionized job-seeking, making it easier to learn about and apply for new positions.

However, job-seekers should not limit themselves to passive methods such as responding to ads. They should engage in various job search strategies, which may involve attending job fairs, networking at professional events, or utilizing informational interviews to tap into the hidden job market.

Answer:

-$20,000

Explanation:

Economic profit takes into account opportunity cost of an activity.

Opportunity cost is the next best option forgone when one alternative is chosen over other alternatives. Opportunity cost is also known as implicit cost.

Because Bobby chose to work at the seafood resutrant, he forgoed the opportunity of working at the county. Thus, his opportunity cost is $30,000.

Also, if he wasn't making use of the restaurant, he could have rented it out. Thus, his opportunity cost of making use of the restaurant is $20,000.

Economic profit = Revenue - (Implicit cost + Explicit cost)

$50,000 - ($20,000 + $30,000 + $20,000) = -$20,000

I hope my answer helps you

Answer:

A. Decrease net capital outflow

B. Increase in net exports

C. Decrease in net exports.

D. Increase net capital outflow.

Explanation:

A. When the Sony pension fund buys U.S treasury then there is a inflow of capital. Hence, this will decrease the net capital outflow.

B. The Sunkist oranges is purchased by the South Korean tourist from the american farmer will increase the exports of the U.S. Hence, there is an increase in the net exports.

C. When a Toyota is purchased by an American then this will increase the imports of United states and hence, there is a reduction in the net exports.

D. The shares of Sony are purchased by an american, so there is a outflow of capital and this will increase the net capital outflow.

Each transaction impacts either net exports or net capital outflow for the U.S: buying a bond from the U.S. Treasury increases net capital inflow, buying Sunkist oranges increases net exports, buying a Toyota decreases net exports, and buying a share of Sony stock increases net capital outflow.

When the Sony pension fund buys a bond from the U.S. Treasury, there is an increase in net capital inflow, as this represents financial capital from Japan flowing into the U.S. economy. The South Korean tourist buying Sunkist oranges from an American farmer is an increase in net exports for the U.S., as this is a sale of American goods overseas. An American buying a Toyota would lead to a decrease in net exports, as this is a purchase of foreign goods. Transactions such as an American buying a share of Sony stock would result in an increase in net capital outflow, as this is an investment of U.S. capital in a foreign company.

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Solution:

a. To Prepare a traditional income statement.

Finishing Sales                                            37,000.00

Energy Costs                         7,600.00

Repair Costs                         12,700.00

                                                                    20,300.00

Operating Profit                                            16,700.00

b. To Prepare an activity-based income statement.

                         Resources Used   Unused Resources  Resources Supplied

Finishing Sales                                                                                37,000.00

Costs

Volume Related Energy   4,500                3,000           7,600.00

Batch Related Repairs     10,500             2,100.00        12,700.00

Total Costs                       15,000                5,100           20,100.00   20,100.00

Finishing Operating Profits                                                                 15,900.00

Answer:

d.$500

Explanation:

Economic order quantity is the quantity at which business incur minimum cost. This is the level of order where the holding cost equals to the ordering cost of the business.

As per given data

Annual Demand = 5,000 cases

Ordering cost = $250

Carrying cost = $10

EOQ =  [tex]\sqrt{\frac{2 X S X D}{H} }[/tex]

EOQ = [tex]\sqrt{\frac{2 X 250 X 5,000}{10} }[/tex]

EOQ = 500

Answer:

EOQ = 500 units

Explanation:

Explanation:

The Economic Order Quantity (EOQ) is the order quantity that minimizes the balance of holding cost and ordering cost. At the EOQ, the holding cost is exactly the same as the ordering cost.

It is calculated as follows:

EOQ = √(√2× Co D)/Ch)

Co- ordering cost - 250,

Ch - holding cost - 10

D- annual demand- 5000

So we apply the formula:

EOQ = √(2× 250 × 5,000/10)

EOQ = 500 units

Answer:

The direct or indirect strategy

Explanation:

When delivering a bad message there are usually five things that have to be put into consideration. They include:

- How to get the bad message to the person concerned.

- How the individual/audience will receive the message.

- Maintaining a good relationship with the receiver of the bad news.

- Maintaining a good reputation for the company.

- Avoiding any future retaliation.

(I) The Direct Approach

When using the direct approach to deliver a bad message, the message must be delivered in clear and concise statements, stating reasons why it happened and ending it in a positive note by offering solutions to the problem.

(II) The Indirect Approach

In the indirect approach it is necessary for the individual delivering the bad message to create some form of common ground with the receiver of the message to ease the tension. Then the message is delivered in clear statements. It is better to start with the positive part of the message before moving into the negative part. The message should be concluded on a positive note to avoid future retaliation.

Final answer:

Bad news messages should generally be delivered using the indirect strategy, which involves starting with a buffer statement, providing an explanation, and offering solutions or alternatives.

Explanation:

When delivering bad news messages, it is generally recommended to use the indirect strategy. This involves starting with a buffer statement to soften the blow, providing a clear explanation of the situation, and offering any potential solutions or alternatives. The goal is to ease the impact of the bad news and maintain a positive relationship with the recipient.

Using the direct strategy can be too abrupt and may cause unnecessary conflict or negative reactions. However, in some cases where the bad news is simple, the direct strategy may be appropriate.

It is important to note that a mixture of both strategies can also be used, depending on the nature of the situation and the relationship between the sender and the recipient.

Answer:

Explanation:

Rivera Co

Selling price $32

Less Variable costs $20

Contribution $12

Sales Volume 4,100 units

A.

Sales = $131,200

Variable costs = $82,000

Contribution = $49,200

Fixed costs = $43,200

Gross profit/ operating income = $6,000

B.

Break even.point (units)= fixed costs divided by contribution per unit

= 43,200 / 12

= 3,600 units

Break even point sales = Break even point (units) x unit selling price

= 3,600 x $32

= $115,200

C.

Sales = $131,200

Variable costs = $57,40

Contribution = $73,800

Fixed costs = $67,800

Gross profit/ operating income = $16,000

D.

Break even.point (units)= fixed costs divided by contribution per unit

= 67,800 / ($32 - $14)

= 3,767 units

Break even point sales = Break even point (units) x unit selling price

= 3,767 x $32

= $120,533

E.

Management should consider the project because Operating income increased by $10,000.

However it takes more sales effort to break even (additional 167units more)

Answer:

Program rating 25%

Share of audience is 15

Explanation:

program rating = 30000/ 60%x 2million = 25%

Answer:

Product D

Explanation:

The contribution margin will be used for this assessment

Contribution margin is the selling price of an item less the associated variable selling cost to determine the extra profit for each unit of an item sold.

However , the grinding hour being the constraint in this scenario , the contribution per minute of production will be used.

                                     A              B                 C                 D

Direct materials        16.60      20.50         13.50         16.20

Direct labor               18.60        22.00        16.40         10.40

Variable Man.            5.40          6.60           9.10            6.10

Variable selling C.     3.60         4.10            3.80           4.50  

Selling price              83.70        76.10          72.90        67.60

Contribution/unit      39.50        22.90       30.10           30.40

Minute /unit                2.50          1.60           1.20            0.8

Contribution /min      15.8           14.13         25.08          38

Product D with the highest contribution per minute of production makes the most profitable use of the machine.

Answer:

40 customers

Explanation:

Expected Demand Rate*current service rate/current utilization=capacity requirement/required utilization

.75*(50/90)=x/.95

x=39.58

x=40 customers

To determine the capacity requirement, calculate the future demand and divide it by the utilization rate minus the desired capacity cushion.

To calculate the capacity requirement that should be planned, we need to determine the future demand and the desired capacity cushion. The current demand is 50 customers per day with a utilization rate of 90% and a capacity cushion of 10%. In five years, the demand is expected to be 75% of the current level and management wants a capacity cushion of 5%.

First, we calculate the future demand by multiplying the current demand by 0.75: future demand = 50 * 0.75 = 37.5 customers per day.

Next, we calculate the required capacity by dividing the future demand by the utilization rate (1 - capacity cushion): required capacity = 37.5 / (0.90 - 0.05) = 44.12 customers per day.

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Answer:

the money multiplier = 1 / reserve ratio

in this case, the reserve ratio is 10% (required) + 10% (voluntary) = 20%, so the money multiplier = 1/20% = 5

What is the immediate impact of this transaction on the money supply?

The maximum amount by which this bank will increase its loans from the transaction in part (a)

The maximum increase in the money supply that will be generated from the transaction in part

Assume that the government increases spending by $9,000, which is financed by a sale of bonds to the central bank. Indicate what will happen to the money supply.

Explain what will happen to the money demand.

When the money multiplier is = 1 / reserve ratio in this case, the reserve ratio is 10% (required) + 10% (voluntary) is = 20%, so the money multiplier = 1/20%=5

None, since when the money supply doesn't switch. When a consumer deposits money in a bank, the money does not improve, only its formatting changes.

The greatest amount by which this bank will increase its loans from the transaction in part (a)

When the bank will be able to loan is ⇒ The total deposit x (1 - reserve ratio) = $9,000 x (1 - 20%) = $7,200

The greatest increase in the money supply that will be generated from the transaction in part

since the banks started to "complete" money by lending the money, the money supply will increase by ⇒ total deposit x (money multiplier - 1) = $9,000 x 4 = $36,000

Suppose that the government rise spending by $9,000, which is financed by a sale of bonds to the central bank. Also, The Foreshadow what will transpire to the money supply.

The money supply will grow. The money demand will also rise because aggregate demand and income will increase.

Aggregate demand will improve by ⇒ a $9,000 x government multiplier. The government multiplier = 1 / MPS.

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Answer:

1,110,000

Explanation:

Parson Corporation's

Volume of unit × Fixed cost per unit

144,000 unit ×2 cost per unit= 288,000

Volume of unit × Variable cost per unit

137,000 unit × 6 cost per unit = 822,000

Therefore

822,000+288,000= 1,110,000

Parson would anticipate 1,110,000 of total cost at a volume of 137,000 units.

Answer:

$ 1, 100,000

Explanation:

Total fixed costs=(2 x 144,000)= $288,000

Hence total cost at 137,000 units=Total fixed costs+Total variable costs

=$288,000 + (6 x 137,000)

=$1,110,000.

Final answer:

The diluted earnings per share (EPS) for L Co. is calculated by dividing the net income minus any preferred dividends by the sum of outstanding shares and dilutive potential shares from convertible securities. L Co.'s diluted EPS for 2021 is $1.36364 after accounting for the tax rate.

Explanation:

The student asked how to calculate diluted earnings per share (EPS) for L Co. for the year 2021, considering that L Co. has convertible bonds that could potentially be converted into shares of common stock. To find the diluted EPS, we first need to calculate the net income available to common stockholders and then divide this by the diluted number of shares outstanding. The formula for diluted EPS is Net Income - Preferred Dividends / Average Shares Outstanding + Dilutive Convertible Securities.

Since no preferred dividends are mentioned, we assume there are none, and the net income is $8,000. For the diluted number of shares, we add the shares that the bonds could convert into. L Co. has 2,200 shares outstanding and can be converted into another 2,200 shares via bonds. Therefore, the diluted number of shares would be 2,200 (existing) + 2,200 (potential from conversion), giving us a total of 4,400 shares.

Diluted EPS = Net Income / (Existing Shares + Convertible Shares) = $8,000 / 4,400 = $1.81818. This value is pre-tax and to get the after-tax diluted EPS, you would multiply by (1 - Tax Rate), so $1.81818 * (1 - 0.25) = $1.36364.

Answer:

Its annual depreciation costs will rise by 4% of $15,250,000 or $610,000. The right answer is a

Explanation:

In order to calculate the amount its annual depreciation costs will rise by, we would have to calculate first the total cost with the following formula:

Total cost=(Number of workstation added×cost of work station)+money spend

Total cost=(70×$75,000)+10,000,000

Total cost=$15,250,000

Therefore, Annual depreciation=4%×$15,250,000

                                                    =$610,000

Its annual depreciation costs will rise by 4% of $15,250,000 or $610,000

Final answer:

To determine the rise in annual depreciation costs after adding new workstations and expanding the assembly plant, the straight-line method of depreciation would be used. However, without the specific depreciation rate, we cannot determine the exact increase in annual depreciation costs from the provided options.

Explanation:

The question is asking about the increase in annual depreciation costs for a company after adding new workstations and expanding its assembly plant. To calculate the additional depreciation costs, we assume that the straight-line method of depreciation is used since the provided examples illustrate this method. With this method, the total cost of the asset is spread evenly over its useful life.

If the company adds 70 new workstations at a cost of $75,000 each, the total cost for the workstations is 70 times $75,000, which equals $5,250,000. The addition to the assembly plant costs $10,000,000. The combined cost is therefore $5,250,000 (workstations) + $10,000,000 (assembly plant addition) = $15,250,000.

Without the specific depreciation rate for the new assets, we cannot determine the exact increase in annual depreciation. Thus, we are unable to select the correct option among the given choices a to e. We would need the specific depreciation rate applied to the combined cost of the new workstations and the assembly plant addition to calculate the annual increase in depreciation.

Answer:

a)

Contributions amounting to $320,000 were non deductible.

First year of withdrawal:

Taxfree withdrawal % = Uncovered Investments / Current year value x 100

Taxfree withdrawal % = [$320,000 / ($441,000 + $35,000)] x 100

Taxfree withdrawal % = [$320 / $476,000] x 100

Taxfree withdrawal % = 67.23%

Amount of taxfree withdrawal = 67.23% x $35,000

Amount of taxfree withdrawal = $23,530.5

Taxable amount = Total Withdrawal - Tax free withdrawal

Taxable amount = $35,000 - $23,530.5

Taxable amount = $11,469.5

Second year of withdrawal:

Taxfree withdrawal % = [($320,000 - $23,530.5) / ($407,000 + $60,000)] x 100

Taxfree withdrawal % = [$296, 469.5 / $467,000] x 100

Taxfree withdrawal % = 63.48%

Amount of taxfree withdrawal = 63.48% x $60,000

Amount of taxfree withdrawal = $38,088

Taxable amount = $60,000 - $38,088

Taxable amount = $21,912

b)

$35,000 would be included in taxable income in first year and $60,000 would be included in taxable income in second year.

The statement that holds true for the American Option is (A) Put-call parity provides an upper and lower bound for the difference between call and put prices

Explanation:

According to the Put-call parity concept when we hold the  short European put and long European call of similar class the return delivered is same as  holding one forward contract of the same underlying asset, that has the same expiration, forward price and which is equal to the strike price of the option

In financial management  put–call parity concept is used to define the  relationship that exist  between the price of a European call option and European put option, and both of them have identical strike price and expiry

The formula used for calculating  put call parity is

c + k = f +p

where (c) call price plus the (k) strike price of both options is equal to the futures price(f) plus the put price(p)

Put-call parity provides an upper and a lower bound for the difference between call and put prices.

The correct answer is A. Put-call parity provides an upper and a lower bound for the difference between call and put prices.

Put-call parity is a fundamental concept in options pricing, which states that the sum of a call option and a put option with the same strike price and expiration date equals the price of the underlying asset.

Using put-call parity, we can derive upper and lower bounds for the difference between call and put prices. These bounds are based on the cost of carry and the time value of money.

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Answer:

Increase by $13,500

Explanation:

Cornish Company

Selling price per unit$17.00

Variable costs per unit

Direct materials and direct labor($200,000/20,000 units)$10.00

Variable overhead[(40% * $100,000)/20,000 units]2.00

Total variable costs per unit($12.00)

Contribution margin per unit$5.00 Units in order* 3,000units

Total contribution margin$15,000

Less incremental fixed costs:

Overhead$500

Selling and administrative1,000

Total incremental fixed costs($1,500)

Incremental income from order$13, 500

Therefore If Cornish accepts the offer, its profits will increase by $13,500

Answer:

Correct option is D.

$10,000 capital loss; $20,000 ordinary income.

Explanation:

Samantha's share of unrealized receivables is $20,000 ($60,000 unrealized receivables × 1/3 interest). Susan will recognize $20,000 of ordinary income and a $10,000 capital gain determined as the difference between the total gain of $30,000 and the ordinary income of $20,000.

Answer:

$10,000 capital gain.

Explanation:

Given that:

So the difference between her basis and sales interest is:

$100,000 - $90,000

= $10,000

She will have a gain on sales of her interest because she receives the only cash for the sales and the amount is greater than her basis in her partnership. Therefore, the gain will be seen as capital

Final answer:

The initial loan amount "XX" cannot be determined with the provided information, as the interest rate and the annual payment amount are missing, which are necessary to calculate the loan balance after 5 years or the original loan amount.

Explanation:

The problem at hand is to calculate the initial loan amount, denoted as XX, which is repaid with level annual payments over 10 years. Given the principal repayment amount in the 6th year and the interest payment in the first year, we can calculate the initial loan amount using the amortization concept of loans. Unfortunately, the question doesn't provide the interest rate or the annual payment, both of which are essential to finding the loan balance after 5 years or calculating the original loan amount. Additional information is needed to solve this problem accurately.

Answer:

Differential cost = $4 per unit

Explanation:

For a make or buy decision the relevant cash flows include

Differential cost = internal cost - External purchase price

                    = 15- 11

                    = $4 per unit

Answer:

Sale - November 10

Cost of Sales

= 48 units × $99

= $4,752

Inventory Balance

=25 units × $99

=$2,475

Sale - November 15

Cost of Sales

=53 units × $105

= $5,565

Inventory Balance

40 units × $105       = $4,200

25 units × $99        = $ 2,475

Total                        = $6,675

Sale - November 24

Cost of Sales

= 13 units × $105

= $ 1,365

Inventory Balance

27 units × $105       = $ 2,835

25 units × $99        = $ 2,475

Total                        = $5,310

Explanation:

LIFO Inventory System sells the Recently Acquired Inventory First followed By Older Inventory Acquired.

Final answer:

Using the LIFO method, we calculate COGS for each sale date by using the most recent inventory costs first. The total COGS for Nov 10 is $4752, Nov 20 is $5565, and Nov 24 is $1365. Remaining inventory is updated after each transaction, with the most recent purchase prices used first.

Explanation:

Perpetual Inventory Using LIFO

When applying the Last-In, First-Out (LIFO) method in a perpetual inventory system, the most recent inventory costs are used first when calculating the cost of goods sold (COGS). Let's determine the COGS for each sale and the ending inventory balance after each sale:

November 10 Sale of 48 units: We have only the beginning inventory, so all 48 units at $99 are sold, totaling $4752 in COGS.

November 20 Sale of 53 units: We have 25 units left from the beginning inventory at $99 and we sold 28 units from the new purchase at $105, totaling $2625 (25 units x $99) + $2940 (28 units x $105) = $5565 in COGS.

November 24 Sale of 13 units: All 13 units are from the new purchase at $105, totaling $1365 in COGS.

The remaining inventory after each sale would be calculated by deducting the COGS from the total inventory available before the sale. After the sales on November 10, 20, and 24, and the purchase on November 15, the balance is 73 units - 48 units sold + 93 units purchased - 53 units sold - 13 units sold = 52 units at $105. When the additional 27 units are purchased on November 30 at $111, the inventory balance will include these new units at the higher price, with the older inventory listed thereafter.

Learn more about LIFO Inventory Calculation here: