Presented below are a number of balance sheet items for Coronado, Inc., for the current year, 2017. Goodwill $ 126,590 Accumulated Depreciation-Equipment $ 292,240 Payroll Taxes Payable 179,181 Inventory 241,390 Bonds payable 301,590 Rent payable (short-term) 46,590 Discount on bonds payable 15,240 Income taxes payable 99,952 Cash 361,590 Rent payable (long-term) 481,590 Land 481,590 Common stock, $1 par value 201,590 Notes receivable 447,290 Preferred stock, $10 par value 151,590 Notes payable (to banks) 266,590 Prepaid expenses 89,510 Accounts payable 491,590 Equipment 1,471,590 Retained earnings ? Debt investments (trading) 122,590 Income taxes receivable 99,220 Accumulated Depreciation-Buildings 270,440 Notes payable (long-term) 1,601,590 Buildings 1,641,590 Prepare a classified balance sheet in good form. Common stock authorized was 400,000 shares, and preferred stock authorized was 20,000 shares. Assume that notes receivable and notes payable are short-term, unless stated otherwise. Cost and fair value of debt investments (trading) are the same. (List Current Assets in the order of liquidity. List Property, Plant and Equipment in order of Land, Building and Equipment.)
Answers
Answer:
A classified balance sheet is a class of balance sheet presentation that carefully displays all account balance listings into subcategories and in order of liquidity.
It is easier for a reader of the Account to follow the narrative and draw conclusions quickly, requiring less assumptions or queries from analysts over the qualification of the items.
Explanation
The balance sheet is contained in the attached document to preserve its form.
Final answer:
Provided is a detailed classified balance sheet for Coronado, Inc. for the year 2017, listing assets, liabilities, and equity items. The summary adheres to the specific order of categories as requested, offering a clear depiction of the company's financial status.
Explanation:
Balance Sheet for Coronado, Inc. as of 2017:
Assets:
Cash: $361,590
Notes Receivable: $447,290
Inventory: $241,390
Land: $481,590
Equipment: $1,471,590
Liabilities:
Accounts Payable: $491,590
Notes Payable (to banks): $266,590
Bonds Payable: $301,590
Equity:
Common Stock: $201,590
Preferred Stock: $151,590
Retained Earnings: Calculated
Related Questions
Shares of common stock of the Samson Co. offer an expected total return of 13.00 percent. The dividend is increasing at a constant 5.40 percent per year. The dividend yield must be: Multiple Choice 2.41% 13.00% 5.40% 7.60% 18.40%
Answers
Answer:
7.6%
Explanation:
The formula for calculating the Required return is:
Required return = Dividend yield + Capital Gain Yield
Hence,
13% = Dividend Yield + 5.40%
Dividend Yield = 7.60%.
Hope this helps.
Goodluck.
The current controllable margin for Henry Division is $138000. Its current operating assets are $300000. The division is considering purchasing equipment for $90000 that will increase annual controllable margin by an estimated $5000. If the equipment is purchased, what will happen to the return on investment for Henry Division
Answers
Answer:
The correct answer is Decrease ROI by 9.33%.
Explanation:
According to the scenario, the computation of the given data are as follows:
First we calculate return on investment before purchase:
Return on investment = (Controllable Margin ÷ Operating assets ) × 100
= ($138,000 ÷ $300,000) × 100
= 46%
Controllable margin (New) = $138,000 + $5,000 = $143,000
Operating assets = $300,000 + $90,000 = $390,000
Return on investment (New) = ($143,000 ÷ $390,000) × 100
= 36.67%
So, change in ROI = 36.67 % - 46%
= - 9.33% ( Negative shows decrease )
Hence, Decrease ROI by 9.33%.
The model of competitive markets relies on these three core assumptions: 1. There must be many buyers and sellers—a few players can't dominate the market. 2. Firms must produce an identical product—buyers must regard all sellers' products as equivalent. 3. Firms and resources must be fully mobile, allowing free entry into and exit from the industry.
Answers
Answer:
A Perfectly competitive market
Explanation:
To answer the question above, the model of competitive market is called A Perfectly competitive market.
A perfectly competitive market is a hypothetical market where competition is at it's greatest possible level. Neo-classical economist argued that perfect competition would produce the best possible outcomes for consumers, and society.
An industry structure in which there are many firms, none large enough to influence the industry, producing homogeneous products. Firms are price takers. There are no barriers to entry . Agriculture comes close to being perfectly competitive.
Mountain Sports, Inc., is a retailer that has engaged you to assist in the preparation of its financial statements at December 31, 2018. Following are the correct adjusted account balances, in alphabetical order, as of that date. Each balance is the "normal" balance for that account. (Hint: The "normal" balance is the same as the debit or credit side that increases the account.) Accounts payable $ 13,450 Accounts receivable 2,700 Accumulated depreciation: office equipment 12,100 Additional paid-in capital (common stock) 7,300 Bonds payable (due December 31, 2021) 23,400 Cash 14,400 Common stock (2,600 shares, $10 par value) 26,000 Cost of goods sold 109,000 Deferred income taxes 6,150 Depreciation expense: office equipment 2,600 Dividends declared 4,400 Income tax expense 7,990 Insurance expense 830 Land 39,200 Merchandise inventory 20,300 Notes payable (due December 31, 2019) 2,600 Office equipment 42,300 Office supplies 840 Office supplies expense 470 Preferred stock (300 shares, $20 par value) 6,000 Premium on bonds payable 2,100 Prepaid rent 1,200 Rent expense 5,800 Retained earnings (January 2018) 21,300 Salaries expense 87,620 Sales 226,500 Sales returns and allowances 1,900 Sales taxes payable 3,200 Treasury stock (400 common shares at cost) 4,500 Utilities expense 4,050 b. Prepare a statement of retained earnings for the year ending December 31, 2018.
Answers
Answer:
The financial statement of an enterprise consists usually of:
An income statement
A statement of retained earnings
A cash flow statement
And a statement of financial position.
This has been fully presented in the attached documents
To prepare a statement of retained earnings, start with the opening balance then adjust it for the net income or loss during the year and any dividends declared. Create the statement in three steps: sum up the revenue and expenses to determine net income, and then subtract any dividends from this.
Explanation:To create a statement of retained earnings for Mountain Sports Inc., we need to consider the opening balance in the retained earnings account, then adjust this for the net income or loss during the year and any dividends paid out.
Start with the retained earnings at the beginning of the year, which is $21,300. Then, determine the net income. The net income is calculated as sales of $226,500 minus expenses (cost of goods sold of $109,000, depreciation expense on office equipment of $2,600, insurance expense of $830, rent expense of $5,800, utilities expense of $4,050, office supplies expense of $470, and salaries expense of $87,620) and the income tax expense of $7,990. Sierra sales returns and allowances of $1,900 will also be subtracted from sales.
The final step is to subtract dividends declared of $4,400 to arrive at the retained earnings at year-end.
Learn more about Statement of Retained Earnings here:https://brainly.com/question/30803919
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Shehata Coffee Shop calculated the NET value of its accounts receivable as of December 31, 2019, to be $179,000, based on an aging schedule of accounts receivable. Shehata has also provided the following information: The gross accounts receivable balance on December 31, 2019 was $191,800. Actual uncollectible accounts receivable written off during 2019 totaled $13,400. The Allowance for Uncollectible Accounts balance on January 1, 2019 was $17,800.
Required: Part 1: What account(s) and for what $ value(s) would appear on the Balance Sheet?
Part 2: How much is Shehata's 2019 Bad Debt Expense? Show your detailed calculation for credit, 6 points:
a. 17,200
b. 12,800
c. 8,400
d. 4,400
e. None of the above
Answers
Answer:
1. The preparation of balance sheet is shown below:-
2. $8,400
Explanation:
1 Balance sheet
December 31, 2019
Assets Amount
Current assets
Accounts receivables $191,800
Allowance for uncollectible accounts ($12,800)
Net accounts receivables $179,000
Working note:-
Net accounts receivables = $179,000
Gross accounts receivables = $191,800
Allowance for uncollectible accounts, December 31, 2019 = Gross accounts receivables - Net accounts receivables
= $191,800 - $179,000
= $12,800
2. Bad debt expense = Allowance for uncollectible accounts, December 31, 2019 - (Allowance for uncollectible accounts, January 1, 2019 - Uncollectible accounts written off during 2019)
= $12,800 - ($17,800 - $13,400)
= $12,800 - $4,400
= $8,400
The next dividend payment by Savitz, Inc., will be $1.72 per share. The dividends are anticipated to maintain a growth rate of 4 percent forever. If the stock currently sells for $33 per share, what is the required return
Answers
Answer:
9.21%
Explanation:
To calculate this, we use the formula for the dividend discount model as follows:
P = D/(r - g) ............................ (1)
Where,
P = current stock price = $33
D = Next dividend = $1.72
r = required return = ?
g = growth rate = 4% = 0.04
Substituting the values into equation (1) and solve for r, we have:
33 = 1.72/(r - 0.04)
33(r - 0.04) = 1.72
33r - 1.32 = 1.72
33r = 1.72 + 1.32
33r = 3.04
r = 3.04/33
r = 0.0921, or 9.21%
At the beginning of the month, the Painting Department of Skye Manufacturing had 30,000 units in inventory, 70% complete as to materials, and 20% complete as to conversion. The cost of the beginning inventory, $38,650, consisted of $32,400 of material costs and $6,250 of conversion costs. During the month the department started 125,000 units and transferred 135,000 units to the next manufacturing department. Costs added in the current month consisted of $282,240 of materials costs and $544,700 of conversion costs. At the end of the month, the department had 20,000 units in inventory, 40% complete as to materials and 15% complete as to conversion. If Skye Manufacturing uses the weighted average method of process costing, compute the costs per equivalent unit of materials and conversion respectively for the Painting Department.
Answers
Answer:
Cost per equivalent unit of material = $2.20 per unit
Cost per equivalent unit of conversion = $4 unit
Explanation:
The computation of Cost per equivalent unit of material, Cost per equivalent unit of conversion is shown below:-
For computing the cost per equivalent first we need to find the equivalent unit of material which is below:-
= Transferred units + ( Department units × Material percentage)
= 135,000 + (20,000 × 40%)
= 135,000 + 8,000
= 143,000
So, the Cost per equivalent unit of material = (Beginning material cost + Current month material cost) ÷ Equivalent unit of material
= ($32,400 + $282,240) ÷ 143,000
= $314,640 ÷ 143,000
= $2.20 per unit
Now, For computing the Cost per equivalent unit of conversion first we need to find the equivalent unit of conversion cost which is below:-
= Transferred units + ( Department units × Conversion percentage)
= 135,000 + (20,000 × 15%)
= 135,000 + 3,000
= 138,000
So, the Cost per equivalent unit of conversion = (Beginning conversion cost + Current month conversion cost) ÷ Equivalent unit of conversion cost
= ($6,250 + $544,700) ÷ 138,000
= $550,950 ÷ 138,000
= 3.99
or $4 unit
A corporate bond that pays interest annually yields a rate of return of 10.00 percent. The inflation rate for the same period is 4 percent. What is the real rate of return on this bond
Answers
Answer:
5.76%
Explanation:
The solution is as follows,
=> (1 + 0.10) = (1 + r) * (1 + 0.04)
=> r = (1.1 / 1.04) - 1
=> r = 5.76%
Hope this clear things up.
Thankyou.
Answer:
The real rate of return on this bond is 5.77%
Explanation:
1. Let's review the information given to us to answer the question correctly:
Nominal rate = 10% = 0.1
Inflation rate = 4% = 0.04
2. What is the real rate of return on this bond?
Let's recall the formula of the Real Rate of Return:
Real Rate of Return = (1 + Nominal rate/1 + Inflation rate) - 1
Replacing with the values we know, we have:
Real Rate of Return = (1 + 0.1/1 + 0.04) - 1
Real Rate of Return = 1.0577 - 1
Real Rate of Return = 0.0577 or 5.77%
The weighted average cost of capital is ________. A. the cost of capital for the firm as a whole B. made up of three financing components: the cost of debt, the cost of preferred stock, and the cost of equity C. the average of the cost of each financing component, weighted by the proportion of each component D. All of the above
Answers
Answer:
The answer is D. All of the above
Explanation:
The Capital structure of most companies comprise equity, debt and/or preference shares. All these that made up capital structure has cost or let's say return. We have cost of capital, cost of debt, cost of preference shares.
Therefore, weighted average cost of capital is average of the cost of each financing component(cost of capital, cost of debt and cost of preference shares), weighted by the proportion of each component
All the options relates to the weighted average cost of capital(WACC).
The weighted average cost of capital (WACC) encompasses the cost of capital for the entire firm, including the cost of debt, equity, and preferred stock, weighted by their proportions in the total capital.
Explanation:The weighted average cost of capital (WACC) is D. All of the above. It is the cost of capital for the firm as a whole, made up of three financing components: the cost of debt, the cost of preferred stock, and the cost of equity. Additionally, it is the average of the cost of each financing component, weighted by the proportion of each component in the overall capital structure. WACC is a crucial metric for firms as it represents the minimum return that a company must earn on its existing asset base to satisfy its creditors, owners, and other providers of capital, or they will invest elsewhere.
Calculator Production Budget and Direct Materials Purchases Budgets Peanut Land Inc. produces all-natural organic peanut butter. The peanut butter is sold in 12-ounce jars. The sales budget for the first four months of the year is as follows: Unit Sales Dollar Sales ($) January 80,000 176,000 February 50,000 110,000 March 40,000 88,000 April 46,000 101,200 Company policy requires that ending inventories for each month be 25% of next month's sales. At the beginning of January, the inventory of peanut butter is 33,000 jars. Each jar of peanut butter needs two raw materials: 24 ounces of peanuts and one jar. Company policy requires that ending inventories of raw materials for each month be 20% of the next month's production needs. That policy was met on January 1. Required: 1. Prepare a production budget for the first quarter of the year. Show the number of jars that should be produced each month as well as for the quarter in total.
Answers
Answer:
Explanation:
Sales budget
$Revenue Unit
January 176,000 80,000
February 110,000 50,000
March 88,000 40,000
April 101,200 46,000
Ending inventory = 25% of next month sales
Ending inventory in December = 25% of next month sales.
Opening inventory in January = 33,000 units
January (80000-33000)+25% *50000 = 59,500 units
February = (50000 -12500) + 25%*40000 = 47,500 units
March = (40,000-10,000) +25%*46,000 = 41,500 units
April =46000-11,500= 34,500 units
Raw materials Peanut Jars
January 59,500 * 24 1,428,000 59,500
February 47,500*24 1,140,000 47,500
March 41,500 *24 996,000 41,500
April 34,500 *24 828,000 34,500
Company policy for production requires that ending inventory is 20% of next month production
Peanut production
January 1428000 + (20%* 1140000) = 1,656,000
February = (1140000-228000) + (20%*996,000) = 1,111,200
March = (996,000-199,200 ) + (20% * 828,000) =962,400
April 828,000- 165,500 = 662,400
Total peanut production = 4,392,000
Jars production
January = 59500 + (20% * 47,500)= 69,000
February = (47,500-9500) + (20% * 41,500) = 46,300
March = (41,500 - 8,300) + (20% * 34,500) 40,100
April = 34,500-6900 =27600
Total = 183,000
The production budget for Peanut Land Inc. for the first quarter requires producing 59,500 jars in January, 47,500 jars in February, and 41,500 jars in March, totaling 148,500 jars for the quarter.
Production Budget Calculation
To prepare a production budget for Peanut Land Inc., we'll need to calculate the required production to meet sales demands while maintaining the company's inventory policy. The policy states that ending inventory should be 25% of the next month's sales. The production budget can be calculated by adding the budgeted sales in units for each month to the desired ending inventory and then subtracting the beginning inventory.
For January, the company has an initial inventory of 33,000 jars and a sales forecast of 80,000 jars. February's sales forecast is 50,000 jars, meaning January's ending inventory must be 25% of this, which is 12,500 jars. Hence, January's required production is 80,000 (sales) + 12,500 (ending inventory) - 33,000 (beginning inventory) = 59,500 jars.
For February, the beginning inventory is January's ending inventory (12,500 jars). With a sales forecast of 50,000 jars and March's sales forecast at 40,000 jars, February's ending inventory should be 25% of March's sales, which is 10,000 jars. Therefore, production for February is 50,000 (sales) + 10,000 (ending inventory) - 12,500 (beginning inventory) = 47,500 jars.
For March, we use February's ending inventory as the starting inventory (10,000 jars). With sales forecasted at 40,000 jars, and April's sales at 46,000 jars, March's ending inventory should be 25% of April's sales, which is 11,500 jars. Thus, March's production is 40,000 (sales) + 11,500 (ending inventory) - 10,000 (beginning inventory) = 41,500 jars.
The total production for the first quarter is the sum of each month's production: 59,500 (January) + 47,500 (February) + 41,500 (March) = 148,500 jars.
Gray is a 50% partner in Fabco Partnership. Gray's tax basis in Fabco on January 1, year 4, was $5,000. Fabco made no distributions to the partners during year 4 and recorded the following: Ordinary income $20,000 Tax-exempt income 8,000 Portfolio income 4,000 What is Gray's tax basis in Fabco on December 31, year 4?
Answers
Answer:
$21000
Explanation:
To determine Gray’s tax basis for a 50% interest in the Fabco Partnership, The interest is increased by the partner’s distributive share of all partnership items of income and decreased by the partner’s distributive share of all loss and deduction items.
Gray’s beginning basis = $5,000
Gray’s 50% distributive share of ordinary income = 50% × $20000 = $10000
Gray’s 50% tax-exempt income= 50% × $8000 = $4,000 and
portfolio income = 50% × $4000 = $2,000
Therefore, the ending basis of Gray’s Fabco partnership interest = $5000 + $10000 + $4000 + $2000 = $21000
Job A3B was ordered by a customer on September 25. During the month of September, Jaycee Corporation requisitioned $3,500 of direct materials and used $5,000 of direct labor. The job was not finished by the end of September, but needed an additional $4,000 of direct materials in October and additional direct labor of $7,500 to finish the job. The company applies overhead at the end of each month at a rate of 100% of the direct labor cost. What is the amount of job costs added to Work in Process Inventory during October?
Answers
Answer:
Total job costs added in October $ 19,000
Explanation:
Computations
Job costs added to Work in Process inventory for October
Direct materials $ 4,000
Direct labor $ 7,500
Overhead at 100 % of Direct Labor costs $ 7,500
Total job costs added in October $ 19,000
Final answer:
In October, job A3B had $4,000 in direct materials, $7,500 in direct labor, and $7,500 in overhead costs added to the Work in Process Inventory, totaling $19,000.
Explanation:
The job costs added to Work in Process Inventory during October for job A3B would include the additional direct materials and direct labor costs incurred in October, as well as the overhead applied based on the direct labor cost.
Since the company applies overhead at a rate of 100% of the direct labor cost, and the direct labor cost in October is $7,500, the overhead for October would also be $7,500.
Therefore, the total job costs added in October would be the sum of the additional direct materials of $4,000, the additional direct labor of $7,500, and the overhead of $7,500, resulting in a total of $19,000 added to the Work in Process Inventory.
John Jones has both a cash account and an IRA account at your firm. Mr. Jones calls and asks that 2,000 shares of DEF stock be purchased at the market in his IRA account. The trade is executed, however the transaction was recorded in Mr. Jones' cash account. The proper procedure to correct this is to:
Answers
Answer:
FINRA requires that whenever there is a change of account name or designation relating to an executed order, this said change has to be put into writing. The process is called a "Cancel-Rebill" record. The branch manager or compliance officer in charge must be made aware of the reasons for the change and must tender an approval for the change in writing. This said record must be developed for any change of account designation - even for something as little as moving a trade from a customer's cash account to the same customer's IRA account.
Obj. 2Waylander Coatings Company purchased waterproofing equipment on January 6 for $320,000. The equipment was expected to have a useful life 3 years or of four years, or 20,000 operating hours, and a residual value of $35,000. The equipment was used for 7,200 hours during Year 1, 6,400 hours in Year 2, 4,400 hours in Year 3, and 2,000 hours in Year 4. Instructions Show Me Now Excel Determine the amount of depreciation expense for the years ended December 31, Year 1, Year 2, Year 3, and Year 4, by (A) the straight-line method, (B) the units-of-activity method, and (C) the double-declining-balance method. Also determine the total depreciation expense for the four years by each method. The following columnar headings are suggested for recording the depreciation expense amounts:
Answers
Answer:
Depreciation expense for Year 1 Year 2 Year 3 Year 4
Method: Straight-line $71,250 $71,250 $71,250 $71,250
unit-of-production $102,600 $91,200 $62,700 $28,500
Double-declining $160,000 $80,000 $40,000 $20,000
Total depreciation for the four years under:
straight-line is $285,000unit-of-production is $285,000double-declining is $300,000Explanation:
(A) Under straight-line method, depreciation expense is (cost - residual value) / Estimated useful life = ($320,000 - $35,000) / 4 years = $71,250 yearly depreciation expense.
Accumulated depreciation for 4 years is $71,250 x 4 years $285,000.
The net book value (NBV) of the asset (cost - accumulated depreciation) is at the end of Year 4: $320,000 - $285,000 = $35,000.
(B) The unit-of-production method is used when the asset value closely relates to the units of output it is able to produce. It is expressed with the formula below:
(Original Cost - Salvage value) / Estimated production capacity x Units/year
At Year 1, depreciation expense (DE) is: ($320,000 - $35,000) / 20,000 operating hours x 7,200 hours = $102,600/year
At Year 2, depreciation expense (DE) is: ($320,000 - $35,000) / 20,000 operating hours x 6,400 hours = $91,200/year
At Year 3, depreciation expense (DE) is: ($320,000 - $35,000) / 20,000 operating hours x 4,400 hours = $62,700/year
At Year 4, depreciation expense (DE) is: ($320,000 - $35,000) / 20,000 operating hours x 2,000 hours = $28,500/year
Accumulated depreciation for 4 years is $102,600 + $91,200 + $62,700 + $28,500 = $285,000.
Note that this depreciation method results in higher depreciation charge when the asset is heavily used, at this time, it was in Year 1.
The NBV under this method is is: $320,000 - $285,000 = $35,000.
(C) The double-declining method is otherwise known as the reducing balance method and is given by the formula below:
Double declining method = 2 X SLDP X BV
SLDP = straight-line depreciation percentage
BV = Book value
SLDP is 100%/4 years = 25%, then 25% multiplied by 2 to give 50%
At Year 1, 50% X $320,000 = $160,000
At Year 2, 50% X $160,000 ($320,000 - $160,000) = $80,000
At Year 3, 50% X $80,000 ($160,000 - $80,000) = $40,000
At Year 4, 50% X $40,000 ($80,000 - $40,000) = $20,000
Accumulated depreciation for 4 years is $160,000 + $80,000 + $40,000 + $20,000 = $300,000.
The NBV under this method is is: $320,000 - $300,000 = $20,000.
The owner of a car wash wants to see if the arrival rate of cars follows a Poisson distribution. In order to test the assumption of a Poisson distribution, a random sample of 150 ten-minute intervals was taken. You are given the following observed frequencies:
Number of Cars Arriving in a 10-Minute Interval Frequency
0 3
1 10
2 15
3 23
4 30
5 24
6 20
7 13
8 8
9 or more 4
150
The calculated value for the test statistic equals:_______
Answers
Answer:
4.832
Explanation:
See attached file
Hypothetical Country has $120 in currency, $280 in reserves, and $900 in deposits. There are no excess reserves. Use this information to answer the questions. Enter your answers in decimal form rounded to two decimal places. Calculate the money multiplier. money multiplier: Calculate the reserve ratio. reserve ratio: Calculate the currency drain ratio. currency drain ratio:
Answers
Answer:
Reserve ratio = 31.11%
Currency drain ratio = 13.33%.
Explanation:
Reserve ratio = Reserves/Deposits = $280/$900 = 0.3111, or 31.11%
Currency drain ratio = Currency/Deposits = $120/$900 = 0.1333, or 13.33%
Therefore, reserve ratio is 31.11%, and currency drain ratio is 13.33%.
The common stock of the C.A.L.L. Corporation has been trading in a narrow range around $50 per share for months, and you believe it is going to stay in that range for the next three months. The price of a 3-month put option with an exercise price of $50 is $4. a. If the risk-free interest rate is 10% per year, what must be the price of a 3-month call option on C.A.L.L. stock at an exercise price of $50 if it is at the money
Answers
Answer:
Price of call option = $5.1772
Explanation:
given data
trading x = $50 per share
Current price So = $95
time = 3 month t = [tex]\frac{1}{4}[/tex] year
exercise price of $50, P = $4
risk-free interest rate r = 10%
solution
we use here formula from put-call parity for price of a 3-month call option on C.A.L.L. stock that is
Price of call option = P + So - \frac{x}{(1+r)^t} .....................1
put here value and we will get
Price of call option = $4 + $50 - \frac{50}{(1+0.10)^{1/4}}
Price of call option = $5.1772
Based on predicted production of 37,000 units, a company anticipates $925,000 of fixed costs and $841,750 of variable costs. The flexible budget amounts of fixed and variable costs for 35,000 units are (Do not round intermediate calculations):
$875,000 fixed and $841,750 variable.
$796,250 fixed and $925,000 variable.
$925,000 fixed and $796,250 variable.
$925,000 fixed and $841,750 variable.
$875,000 fixed and $796,250 variable.
Answers
Answer:
Total variable cost= $796,250
Total fixed costs= $925,000
Explanation:
Giving the following information:
Based on predicted production of 37,000 units, a company anticipates $925,000 of fixed costs and $841,750 of variable costs.
The fixed costs does not vary to production, therefore, they will remain the same in the relevant range.
We need to calculate the unitary variable cost:
Unitary variable cost= 841,750/37,000= $22.75
Now, we can calculate the total variable cost for 35,000 units
Total variable cost= 22.75*35,000= $796,250
Total fixed costs= $925,000
Englert Hospital began using standards to evaluate its Admissions Department. The standard was broken into two types of admissions as follows: Type of Admission Standard Time to Complete Admission Record Unscheduled admission 30 min. Scheduled admission 15 min. The unscheduled admission took longer because name, address, and insurance information needed to be determined and verified at the time of admission. Information was collected on scheduled admissions prior to the admissions, which was less time-consuming. The Admissions Department employs four full-time people (40 productive hours per week, with no overtime) at $15 per hour. For the most recent week, the department handled 140 unscheduled and 350 scheduled admissions. a. How much was actually spent on labor for the week? $ b. What are the standard hours for the actual volume for the week (round to one decimal place)? hours c. Calculate the time variance. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number. In your computation, round the standard direct labor rate to the nearest whole cent. Time variance $
Answers
Labor costs for the week are determined by multiplying the number of admissions by the standard times and the employee hourly wage. The standard hours are calculated by summing the time for all admissions, and the time variance shows how actual performance compares to standards.
Explanation:The question pertains to the evaluation of labor costs and variance for an admissions department in a hospital. To calculate the labor cost for the week, the total number of admissions is multiplied by the respective standard times and then by the hourly wage of the employees. The standard hours are found by adding the total time taken for both unscheduled and scheduled admissions. The time variance is calculated by subtracting the actual labor hours used from the standard hours for the actual volume of work. The variance indicates whether the department performed better (a negative variance) or worse (a positive variance) than the standard.
Portfolio managers pick stocks for their clients’ portfolios based on the investment objective of the portfolio and several other factors. One key consideration is each stock’s contribution to portfolio risk and its statistical relationship with the portfolio’s other stocks.
ased on your understanding of portfolio risk, identify whether each statement is true or false.
1. Because of the effects of diversification, the portfolio's risk is likely to be more than the average of all stocks' standard deviations
2. The unsystematic risk component of the total portfolio risk can be reduced by adding negatively correlated stocks to the portfolio
3. A portfolio's risk is likely to be smaller than the average of all stocks' standard deviations, because diversification lowers the portfolio's risk.
Answers
Answer:
1. Because of the effects of diversification, the portfolio's risk is likely to be more than the average of all stocks' standard deviations FALSE, IT IS EXACTLY THE OPPOSITE, SINCE THE PORTFOLIO'S RISK IS LIKELY TO BE SMALLER DUE TO DIVERSIFICATION.
2. The unsystematic risk component of the total portfolio risk can be reduced by adding negatively correlated stocks to the portfolio TRUE, NEGATIVELY CORRELATED STOCKS ARE USED TO DECREASE A PORTFOLIO'S RISK
3. A portfolio's risk is likely to be smaller than the average of all stocks' standard deviations, because diversification lowers the portfolio's risk. TRUE, THIS STATEMENT IS JUST THE OPPOSITE OF STATEMENT 1 WHICH WAS FALSE.
Diversification helps to reduce the risk of a portfolio by spreading it across different assets.
Explanation:1. False. Due to the effects of diversification, the portfolio's risk is likely to be less than the average of all stocks' standard deviations. Diversification helps to spread the risk across different assets, reducing the overall risk of the portfolio.
2. True. By adding negatively correlated stocks to the portfolio, the unsystematic risk component of the total portfolio risk can be reduced. This is because negatively correlated stocks tend to move in opposite directions, offsetting each other's risks.
3. True. A portfolio's risk is likely to be smaller than the average of all stocks' standard deviations because diversification lowers the portfolio's risk. Diversification helps to reduce the impact of individual stock price movements on the overall portfolio.
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Molteni Motors Inc. recently reported $3.5 million of net income. Its EBIT was $5.25 million, and its tax rate was 30%. What was its interest expense? (Hint: Write out the headings for an income statement and then fill in the known values. Then divide $3.5 million net income by 1 − T = 0.7 to find the pre-tax income. The difference between EBIT and taxable income must be the interest expense.) Round your answer to the nearest dollar. Enter your answer in dollars. For example, an answer of $1.2 million should be entered as 1,200,000.
Answers
Answer:
$250,000
Explanation:
The computation of the interest expense is shown below:
Given that
Net Income = $3,500,000
Tax rate = 30%
EBIT = $5,250,000
As we know that
EBT = EBIT - Interest Expense
So,
Interest expense = EBIT - EBT
where,
EBT = Net Income ÷ (1 -Taxes)
= $3,500,000 ÷ ( 1 - 30%)
= $5,000,000
And, the EBIT is $5,250,000
So, the interest expense is
= $5,250,000 - $5,000,000
= $250,000
We simply applied the above formula
Sam and Sarah, husband and wife, both worked for an aluminum siding firm, doing similar work in production. Their co-worker, Ahmed, who was a Muslim, was systematically harassed by their supervisor, who called him a terrorist, denied him the right to pray, and generally made his life at work very difficult. Sarah spoke up on his behalf, and the supervisor demoted Sam, her husband. Which of the following statements is most correct
a. Ahmed has a cause of action against the employer for retaliation, but Sam does not
b. Sarah has a cause of action against the employer for retaliation, but Sam does not
c. Sam has a cause of action against the employer for retaliation
d. There are no causes of action arising from this set of facts
Answers
Answer:
Answer is C
Explanation:
Sam has a cause of action against the employer for retaliation.
Answer:
give this answer a "thanks " or i wont help
Explanation:
The data given below are from the accounting records of the Kuhn Corporation:
Net Income (accrual basis) $61,000
Depreciation Expense $17,000
Decrease in Accounts Payable $3,300
Decrease in Inventory $3,800
Increase in Bonds Payable $18,000
Sale of Common Stock for cash $31,600
Increase in Accounts Receivable $6,100
Based on this information, the net cash provided by (used in) operating activities using the indirect method would be:________
Answers
Answer:
$72,400
Explanation:
The preparation of the Cash Flows from Operating Activities - Indirect Method is presented below:
Cash flow from Operating activities - Indirect method
Net income $61,000
Adjustment made:
Add : Depreciation expense $17,000
Less: Increase in accounts receivable -$6,100
Add: Decrease in inventory $3,800
Less: Decrease in accounts payable -$3,300
Total of Adjustments $11,400
Net Cash flow provided Operating activities $72,400
The items in minus sign reflects the cash outflow and the items in plus sign shows the cash inflow
Teddy Bower is an outdoor clothing and accessories chain that purchases a line of parkas at $12 each from its Asian supplier, TeddySports. Unfortunately, at the time of the order placement, demand is still uncertain: Teddy Bower forecasts that its demand is normally distributed with a mean of 2,300 and a standard deviation of 1,100. Teddy Bower sells these parkas at $22 each. Unsold parkas have little salvage value; Teddy Bower simply gives them away to a charity (and also doesn’t collect a tax benefit for the donation).
a) How many parkas should Teddy Bower buy from TeddySports to maximize expected profit?
For parts b) through d), assume Teddy Bower orders 3,000 parkas (Q=3,000). b) What is Teddy Bower’s CSL (in-stock probability)?
c) On average, how many customers does Teddy Bower expect to turn away because of shortage? And on average, how many parkas will Teddy Bower liquidate after each season?
d) What is Teddy Bower’s expected profit?
Answers
Answer:
a) 2179 parkas
b) 0.7389
c) 174 customers
d) 10,772
Explanation:
Given:
Bower's selling price =$22
Salvage value: $0
Cost price = $12
Mean distribution= 2300 parkas
S.d = 1100 parkas
a) Number of parkas Teddy Bower should buy from Teddysports to maximize profit:
Let's first calculate overage(Co) and underage (Cu) cost.
•Cu = Selling price - Cost price
= $22 - $12
= $10
Underage cost = $10
•Co = Cost price - Salvage value
= $12 - $0
= $12
Overage cost = $12
Let's now find the critical ratio with the formula:
[tex] \frac{C_u}{C_u+C_o}[/tex]
[tex]= \frac{10}{12+10} [/tex]
= 0.4545
From the Excel function NORMSINV, the corresponding z value is =
NORMSINV(0.4545)
z value = -0.11
For the number of parkas Teddy Brown should order, we have:
Quantity = Mean +(z*s.d)
= 2300+ (-0.11 * 1100)
= 2179 parkas
b) for z value corresponding to expected sales of 3000 parkas, we have:
z value = (expected demand -mean)/s.d
[tex] \frac{3000-2300}{1100}[/tex]
= 0.64
From the Excel function NOEMSDIST, the corresponding probability =
NORMSDIST(0.64)
= 0.7389 = 73.89%
In stock probability = 0.7389
c) For L(0.64) using the standard normal loss function table, L(z) =
L (0.64) = 0.158
For expected lost sales, we have:
S.d * L(z)
= 1100* 0.158
= 173.8
= 174.
On average, there is expected to be a turn away of 174 customers due to shortage.
d)
Lets first calculate expected sales and left over inventory.
•Expected sales = Mean -expected lost sales
= 2,300 - 174
= 2,126
•Left over inventory expected=
Expected demand - Expected lost sales
= 3000 - 2126
= 874
For expected profit, we have:
[tex] (C_u* Expected lost sales)-(C_o* Expected leftover inventory)[/tex]
=($10*2126)-($12*874)
= $10,772
Profit expected = $10,772
Consider two companies that are identical in terms of current operating cash flows and current capital investment. They are also identical in terms of the rate of future growth in operating cash flows. The only difference is that company A has a higher rate of growth in capital expenditures than company B. Which company is more valuable, and why?
Answers
Answer: Most likely Company A
Explanation:
Generally an increase in Capital Expenditure means that a company is investing more which would mean that revenue will increase in future which will give it a higher valuation.
However, sometimes this spending might just be on Maintenance of Capital assets. When this happens the company is given a lower valuation.
Plainly speaking therefore, if Company A has a higher growth rate in Capital Expenditure because they are investing which is likely to be the case, then they would be more valuable than Company B.
A collar is established by buying a share of stock for $50, buying a 6-month put option with exercise price $43, and writing a 6-month call option with exercise price $57. On the basis of the volatility of the stock, you calculate that for a strike price of $43 and expiration of 6 months, N(d1) = 0.8235, whereas for the exercise price of $57, N(d1) = 0.7411. a. What will be the gain or loss on the collar if the stock price increases by $1?
Answers
Answer:
$0.0824
Explanation:
Calculating the gain on the collar, we have:
Gain= (delta of stock)- (delta of call) + (delta of put)
Where,
Delta of call = N(d1) short call=0.7411
Delta of put = (N(d1) long put - 1) =
0.8235 - 1 = -0.1765
Therefore gain will be:
Gain = $1 - 0.7411 - 0.1765
= 0.0824
The gain on the collar by an increase of $1 in stock price is 0.0824
Johanna Pye is a hair stylist at Mamon Salon. The salon's policy states that stylists receive 40 percent of the revenue they generate as their compensation. Johanna grew tired of sharing her income with the salon and decided she wanted to make more money. She continued seeing her existing clients at the salon, but when new clients called for an appointment, Johanna lied and told them the salon was completely booked for the next few months. She then offered to come to their homes and cut their hair for 10 percent less than what the clients would be charged at the salon. She did not report the house call appointments to the salon, and was therefore able to keep all the income she generated from these side clients. This is an example of what type of scheme
Answers
Answer:
Business diversion
Explanation:
The above scenario is an example of business diversion type of scheme whereby Johanna diverted her employer new client in order to generate her personal income, and it happens without the knowledge of her boss
"Advertising": A. is the only form of mass selling. B. is also called "sales promotion." C. is concerned with "promotion" using samples, coupons, and contests. D. involves direct spoken communication between sellers and potential customers. E. is any paid form of nonpersonal presentation of ideas, goods, or services by an identified sponsor.
Answers
Answer:
E. is any paid form of nonpersonal presentation of ideas, goods, or services by an identified sponsor.
Explanation:
Advertising is marketing communication business activity that uses an openly sponsored message to promote and sell a product, service, or idea and are sponsored by the business typically wishing to promote their services. Advertising is communication through various media such as the newspaper, T.V, blogs and other channels the actual presentation of the message is medium that is called ad or an advertisement and includes non-personal messages.Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. Item cost $ 8.00 Standard deviation of weekly demand 20 per week Order cost $ 207.00 Lead time 3 week(s) Annual holding cost (%) 24 % of item cost Service probability 99 % Annual demand 27,400 Average demand 548 per week a. Determine the order quantity and reorder point.
Answers
Answer:
Order quantity = 478units
Reorder point = 420 per week
Explanation:
Given
Item cost =$8
Standard deviation of weekly demand = 20 per week
Order cost(C) = $207
Lead time = 3 weeks
Annual holding cost (H) = 24% of item cost
Service probability = 99%
Annual demand(D) = 27,400
Average demand = 548 per week
Order quantity = sqrt[(2 × D × C) ÷ H]
Order quantity = sqrt[(2 × 27400 × 207) ÷ (0.24 × 207)]
sqrt[ 11343600 ÷ 49.68]
= 477.84
Order quantity = 478 units
Reorder Point = Lead time × daily usage
21 × 20 = 420
The dollar-value LIFO method was adopted by Blue Corp. on January 1, 2020. Its inventory on that date was $390,700. On December 31, 2020, the inventory at prices existing on that date amounted to $369,600. The price level at January 1, 2020, was 100, and the price level at December 31, 2020, was 112.
Answers
Final answer:
The question involves applying the dollar-value LIFO inventory method to adjust the year-end inventory for inflation, ensuring accurate valuation. It requires calculating the adjusted value of inventory considering changes in price levels to determine real changes in inventory quantity. Additionally, accounting profit is mentioned as a basic calculation of revenue minus expenses.
Explanation:
The question asks about the dollar-value LIFO (Last-In, First-Out) method, a technique used in accounting to value inventory and measure changes in the cost of products due to inflation. Under this method, a company measures and reports changes in the value of its inventory considering the price level changes. The inventory value at the beginning is given as $390,700 with a price level index of 100. By the end of the year, the inventory value is reported as $369,600 with a price level index of 112. To adjust the ending inventory to compare it fairly with the beginning inventory, we must account for the inflation using the given price indices. This involves converting the ending inventory value to the base year's price level.
To do this, we calculate the inflation-adjusted inventory value by dividing the December 31, 2020, inventory value by the price level index for that date (112) and then multiplying by the base price level index (100). This calculation adjusts the inventory value to reflect what it would have been in the base year, allowing a fair comparison to determine whether there has been a real increase or decrease in inventory quantity. Using this method ensures that the inventory valuation is not inflated merely due to increased prices, thereby providing a more accurate measure of inventory levels for financial reporting and analysis.
Accounting profit is another important concept in business, often calculated as sales revenue minus expenses. For instance, if a firm had sales revenue of $1 million and spent $600,000 on labor, $150,000 on capital, and $200,000 on materials, the firm's accounting profit would be $50,000, which is the remaining amount after subtracting total expenses from sales revenue.