Answer:
The correct answer is letter "A": indirect.
Explanation:
An indirect distribution or sales channel uses intermediaries who have stored the products a company manufactures so they are offered to final consumers. In such a way, manufacturers work with retailers, wholesalers, and smaller stores being in charge of the sale of the goods.
Manufacturers provide their products to stores they trust can represent the firm as if they would be offering the products directly. Producers reduce costs bu engaging in this type of distribution channel.
Ralph Lauren uses Indirect Distribution, a channel involving intermediaries such as Nordstrom, to distribute its products. This helps them reach numerous and more diverse customers.
Explanation:Ralph Lauren uses a form of distribution known as Indirect Distribution to sell Polo shirts through Nordstrom. This is a type of distribution channel where a company uses intermediaries, such as retail stores, to sell its products to the final consumer. In this case, Ralph Lauren is the manufacturer of the Polo shirts, Nordstrom is the intermediary, and the customers are the final consumers. This is advantageous for Ralph Lauren as it allows them to reach a numerous and more diverse customer base that they may not have been able to access otherwise, and it allows Nordstrom to carry a popular, high-quality brand that attracts customers.
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Consider the following pre-merger information about a bidding firm (Firm B) and a target firm (Firm T). Assume that both firms have no debt outstanding. Firm B Firm T Shares Outstanding 8,700 3,600 Price per Share $47 $19 Firm B has estimated that the value of the synergistic benefits from acquiring Firm T is $16,700. If Firm T is willing to be acquired for $21 per share in cash, what will be the price per share for the merged firm? $47 $46.29 $48.09 $19
The share price for the merged firm is $48.09. Therefore, the correct option is C
Explanation:
(a)-Net Present Value (NPV)
Net Present Value (NPV) = Market Value of the Target Firm + synergistic benefit – Acquisition Value
= [3600 Shares multiply $19] plus $16700 minus [3600 Shares multiply $21]
= $68400 plus 16700 minus 75600
= $9500
“Net Present Value (NPV) = $9500
(b) Share Price
Share price = [Market Value of the Bidding firm + NPV] / Number of shares of the Bidding firm
= [( 8700Shares multiply $47) plus $9500] / 8700 Shares
= [$408900 + 9500] / 8700 Shares
= $48.09 per share
“Share Price = $48.09 per share”
Rise Against 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 210,000 shares of stock outstanding. Under Plan II, there would be 150,000 shares of stock outstanding and $2.28 million in debt outstanding. The interest rate on the debt is 8%, and there are no taxes.
a. If EBIT is $500,000, which plan will result in the higher EPS?
b. If EBIT is $750,000, which plan will result in the higher EPS?
c.What is the break-even EBIT(the EBIT yo make both plans indifferent from the EPS point of view)?
Answer:
A. Plan 1 offers higher EPS of $2.38 per share
B. Plan 2 offers higher EPS of $3.73 per share
C. Break even EBIT = $666,400 and will result in an EPS of $3.17 in both plans
Explanation:
EPS = Earnings Per Share = Earnings before tax (EBT) divided by outstanding common stock
A.
Plan 1
EBT = $500,000
Outstanding common stock = 210,000
EPS = $2.38 per share
Plan 2
EBT = EBIT minus Interest on debt = $500,000 - ($2,380,000 x 8%)
= $309,600
Outstanding common stock = 150,000
EPS = $2.06 per share
B.
Plan 1
EBT = $750,000
Outstanding common stock = 210,000
EPS = $3.57 per share
Plan 2
EBT = EBIT minus Interest on debt = $750,000 - ($2,380,000 x 8%)
= $309,600
Outstanding common stock = 150,000
EPS = $3.73 per share
C.
Break even EBIT
EPS (plan 1) = EPS (plan 2)
Let's assume EBIT = ?
? Divided by 210,000 = (? - (2,380,000 x 8%)) all divided by 150,000
? = $666,400
EPS = $3.17 in both plans
Alpha Company makes all its sales on account. Accounts receivable payment experience is as follows: Percent paid in the month of sale 35% Percent paid in the month after the sale 54% Percent paid in the second month after the sale 6% Alpha provided information on sales as follows: May $150,000 June $125,000 July $136,000 August (expected) $142,000 What is budgeted cash to be collected on account for the month of August?
Final answer:
The budgeted cash to be collected on account for the month of August is $134,900.
Explanation:
To calculate the budgeted cash to be collected on account for the month of August, we need to multiply the sales for August by the respective collection percentages. The collection percentages for the month of August are 35% for the month of sale, 54% for the month after the sale, and 6% for the second month after the sale.
So, the budgeted cash to be collected on account for August is:
$142,000 x 35% + $142,000 x 54% + $142,000 x 6% = $49,700 + $76,680 + $8,520 = $134,900
Which of the following scenarios makes Tim liable for undue influence? a. He uses a false identity, borrows $10,000 from Kelly, and disappears with the money. b. He threatens to kill Carlos if Carlos does not sign a contract that transfers all his property to Tim. c. He takes advantage of his grandmother's illness and persuades her to sign a will leaving all her property to him. d. He threatens to bring a lawsuit against Carlos if Carlos does not make him a partner in his firm.
Option C , Tim takes advantage of his grandmother's illness and persuades her to sign a will leaving all her property to him.
Explanation:
A individual who demonstrates excessive control may always be someone who has a special connection with the testator who has had the ability to render the testator vulnerable who affected by terms of danger, difficulty, manipulation.
Undue interference occurs mainly in areas of probate, trust and properties, power of attorney and custody.
Indecent influence is not usually a crime in itself, but it can be a means of committing a crime, including exploitation, fraud, domestic abuse and sexual assault.
The promotional mix includes advertising, personal selling, sales promotion, __________, and direct marketing. A. public relations B. infomercials C. merchandising D. word-of-mouth E. publicity
Answer: option "A" is correct
Explanation:
It's an official context for other options.
Parkway Void Co. issued 17-year bonds two years ago at a coupon rate of 10.1 percent. The bonds make semiannual payments. If these bonds currently sell for 97 percent of par value, what is the YTM?
The Yield to Maturity (YTM) of a bond is calculated using its current market price, face value, payment frequency, years until maturity, and coupon rate. Given the data on the Parkway Void Co.'s bonds, we can use these variables to determine the YTM using a financial calculator or online tool.
Explanation:This question is asking for the yield to maturity (YTM) of bonds issued by Parkway Void Co. The YTM is the total expected return if the bond is held until maturity. The factors involved in determining YTM include: the bond's current market price, its face value, the payment frequency, the number of years until maturity, and the coupon rate. To answer accurately, we also need to know the par value.
Now, given that the bonds were issued two years ago and have a life of 17 years means they have 15 years left till maturity. The bonds were sold at 97 percent of the par value, meaning the price is 0.97 times the par value. Each bond pays semi-annually, which we calculate using the coupon rate of 10.1 percent of the par value. We use these data in the YTM formula which uses an iterative process of guessing and checking until we find a yield that makes the present value of the bond's cash flows equal to its price.
Keep in mind that YTM is expressed as an annual rate, despite coupon payments being made semi-annually, so the effective yield is slightly higher than the quoted YTM. Calculating YTM can be complicated, and you might find it easier to use a financial calculator or an online YTM calculator
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M7_IND4. Andre Greipel is the owner of a small company that produces heart rate monitors. The annual demand is for 2,250 heart rate monitors, and Andre produces these devices in batches. On average, Andre can produce 140 monitors per day during the production process. Demand for monitors has been about 35 monitors per day. The cost to set up the production process is $350, and it costs Andre $0.80 to carry 1 monitor in inventory for one year. How many monitors should Andre produce in each batch
Answer :
a) Economic Production Quantity = 1,612 monitors
b) Number of setups = 1.4
c) Total cost = $972.12 per year
Explanation :
As per the data given in the question,
a) Economic Production Quantity = sqrt((2 × annual demand × set up cost) ÷ carrying cost × (1 - daily demand ÷ daily production))
=sqrt((2 × 2,250 × $350) ÷ $0.80 × (1 - 35 ÷ 140))
= 1,620.19
= 1,621 monitors
b) Number of setups = Annual demand ÷ Economic production quantity
= 2,250 ÷ 1,621
= 1.3880
= 1.4
c) Formula of Total cost = Carrying cost + Annual setup cost
Carrying cost=(Economic production quantity ÷ 2) × Carrying cost × (1 - daily demand ÷ daily production)
= (1,612 ÷ 2)× $0.80 × (1 -35 ÷ 140)
= $486.30
Annual setup cost = (Annual demand ÷ Economic production quantity) × setup cost
= (2,250 ÷ 1,621) × $350
= $485.812
So, Total cost = $486.30 + $485.812
= $972.12 each year
We simply applied the above formulas
A company currently pays a dividend of $2.40 per share. The current price of the stock is $18.22. It expects the growth rate of the dividend to be 2.5% (0.025) annually. What is the required return rate for this stock according to the dividend-discount model
Answer:
The required rate of return is 16%
Explanation:
The constant growth model of the DDM is used whenever the dividends are expected to grow at a constant rate in the future forever. The formula for the constant growth model to calculate the price of the share today is,
P0 = D1 / r-g
Where D1 is dividend next year or D0 *(1+g)
r is the required rate of return
g is the growth rate in dividends
Plugging in the available variables, we can calculate the required rate of return (r).
18.22 = 2.4 * (1+0.025) / r - 0.025
18.22 * (r-0.025) = 2.46
18.22r - 0.4555 = 2.46
18.22r = 2.46 + 0.4555
r = 2.9155 / 18.22
r = 0.1600 or 16.00%
Share Issuances for Cash Chase, Inc., issued 10,000 shares of $20 par value preferred stock at $50 per share and 8,000 shares of no-par value common stock at $20 per share. The common stock has no stated value. All issuances were for cash. a. Prepare the journal entries to record the share issuances. b. Prepare the journal entry for the issuance of the common stock assuming that it had a stated value of $10 per share. c. Prepare the journal entry for the issuance of the common stock assuming that it had a par value of $2 per share.
Answer and Explanation:
a. Cash $500,000 (10,000 shares × $50)
To Preferred stock $200,000 (10,000 shares × $20)
To Paid in capital in excess of par- preferred $300,000
(10,000 shares × $30)
(Being the Issuance of the shares of preferred stock is recorded)
Cash $160,000 (8,000 shares × $20)
To Common stock $160,000
(Being the Issued shares of no par value common stock is recorded)
b. Cash $160,000 (8,000 shares × $20)
To Common stock $80,000 (8,000 shares × $10)
To Paid in capital in excess of par stated- common $80,000
(8,000 shares × $20)
(Issued shares of no par value common stock, stated value)
c. Cash $160,000 (8,000 shares × $20)
To Common stock $16,000 (8,000 shares × $2)
To Paid in capital in excess of par - Common $144,000 (8,000 shares × $18)
(Being the Issued shares of common stock is recorded)
Yuri Co. operates a chain of gift shops. The company maintains a defined contribution pension plan for its employees. The plan requires quarterly installments to be paid to the funding agent, Whims Funds, by the fifteenth of the month following the end of each quarter. Assume that the pension cost is $162,600 for the quarter ended December 31.
Required:
a. Journalize the entry to record the accrued pension liability on December 31.
Answer:
On December 31
Pension expense $162,600
To Unfunded pension liability $162,600
Explanation:
The journal entry is shown below:
On December 31
Pension expense $162,600
To Unfunded pension liability $162,600
(Being the accrued pension liability is recorded)
For recording this journal entry we debited the pension expense as it increased the expense and credited the unfunded pension liability as it also increased the liabilities
BE9.1 (LO 1), AN Maris Company uses the following budgets: balance sheet, capital expenditure, cash, direct labor, direct materials, income statement, manufacturing overhead, production, sales, and selling and administrative expense. Prepare a diagram of the interrelationships of the budgets in the master budget. Indicate whether each budget is an operating or a financial budget. Prepare a diagram of a master budget.
Final answer:
A master budget is composed of various interrelated parts such as the sales, production, direct materials, direct labor, manufacturing overhead, selling and administrative expense, and capital expenditure budgets, which culminate in the financial budgets, including the cash budget, and the projected income statement and balance sheet.
Explanation:
When preparing a master budget, various interrelated budgets are involved. The student's inquiry pertains to understanding these interrelationships and categorizing each budget as either an operating or a financial budget. A master budget consists of several components, such as the sales budget, production budget, direct materials budget, direct labor budget, manufacturing overhead budget, selling and administrative expense budget, and capital expenditure budget. These components are then used to prepare the financial budgets, which include the cash budget, the budgeted income statement, and the budgeted balance sheet.
For a clear understanding, we can visualize the budget creation process starting with the sales budget, which leads to the production budget, influencing the direct materials, direct labor, and manufacturing overhead budgets. The ending totals of these budgets are then used to construct the operating budgets, which, together with the selling and administrative expense budget and the capital expenditure budget, give a comprehensive picture of the company's planned operations. Finally, the cash budget is created, integrating all the inflows and outflows from operations and financial activities, yielding the budgeted income statement and the budgeted balance sheet.
The process reflects how operations will be financed, and how resources will be allocated and can show whether the company is likely to realize a budget surplus or face a budget deficit during the fiscal period. The alignment and accuracy of these budgets are crucial for the health of the company's finances, akin to how the state allocates tax revenues for specific purposes such as road maintenance.
For each of the following characteristics, say whether it describes a perfectly competitive firm, a monopolistically competitive firm, both, or neither.
a. sells a product differentiated from that of its competitors
b. has marginal revenue less than price
c. earns economic profit in the long run
d. produces at the minimum of average total cost in the long run
e. equates marginal revenue and marginal cost
f. charges a price above marginal cost
Answer: Please refer to Explanation
Explanation:
In a Perfectly Competitive market, multiple firms are selling the same product and at the same price whereas in a Monopolistic market, firms sell at goods that are differentiated and a s such are sold at different prices.
a. sells a product differentiated from that of its competitors. MONOPOLISTIC COMPETITIVE FIRM.
- This is the definition of the type of products sold in this market so this is a Monopolistic Competitive Firm.
b. has marginal revenue less than price. MONOPOLISTIC COMPETITIVE FIRM.
- As a result of goods being differentiated, firms in a Monopolistic market have to reduce prices to sell more. This leads to a Marginal Revenue curve that is less than the price.
c. earns economic profit in the long run. NEITHER.
- Due to low barriers to entry in both markets, companies cannot make an Economic profit in the long run as competition will increase with companies moving freely in and out of the market.
d. produces at the minimum of average total cost in the long run. PERFECTLY COMPETITIVE FIRM.
- In the long run, Perfectly Competitive firms produce at such a rate that their Average Total cost is at the lowest level as opposed to Monopolistic firms.
e. equates marginal revenue and marginal cost. BOTH.
- For both types of firms to be maximising output, they need to produce at the point where Marginal Revenue is equal to Marginal Cost because this level signifies a point where resources are neither being underutilized or overutilized.
f. charges a price above marginal cost. MONOPOLISTIC COMPETITIVE FIRM.
- As earlier mentioned, the Monopolistic firm produces at a point where Marginal Revenue is equal to marginal cost but at the same time marginal revenue is also beneath price. This means that if marginal cost is equal to marginal revenue then it must be less than Price as well.
Multiple businesses offer the same product at a lower price in a Perfectly Competitive market, but in a Monopoly competition, firms sell commodities that are distinct and hence sold at various prices.
1.MONOPOLISTIC COMPETITIVE FIRM.Sells the product that is distinct from its rivals'.
This is a Monopolistic Competitive Firm since this is the description of the sort of items supplied in this market.
2.MONOPOLISTIC COMPETITIVE FIRM.Has a lower marginal revenue than the cost. Because items are different, companies in a Monopolistic market must lower prices in order to sell more. As a result, the Marginal Revenue curves is lower than the price.
3.NEITHER.
In the big scheme of things, it generates a profit. Firms will not be able to earn an economic earnings in the future due to low barriers to entry in both sectors, since competition will intensify as companies move freely into or out of the marketplace.
4.PERFECTLY COMPETITIVE FIRM.In the long term, produces at the lowest possible average total cost. In the long term, Perfectly Competitive enterprises, as contrasted to Monopolistic firms, produce even at a rate that whose Average Overall Cost is the lowest.
5.BOTH.
the difference between marginal revenue and marginal cost. All types of organizations must produce at the position where Marginal Revenue equals Marginal Cost in order to maximize production since this level denotes a point when resources are neither underused nor overutilized.
6.MONOPOLISTIC COMPETITIVE FIRM.charges a price that is higher than the cost of production. As previously stated, a monopolistic corporation produces at a position where marginal revenue equals marginal cost, but marginal revenue is indeed below price. This implies that if marginal cost equals marginal revenue, it also has to be smaller than Price.
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On January 1, 2017, Streuly Sales issued $34,000 in bonds for $18,700. These are six−year bonds with a stated rate of 9% and pay semiannual interest. Streuly Sales uses the straight−line method to amortize the Bond Discount. Immediately after the issue of thebonds, the ledger balances appeared as follows:
Bonds Payable
34,000
Discount on Bonds Payable
15,300
After the second interest payment on December 31, 2017, what is the balance of Discount on Bonds Payable? (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)
A. debit of $14,025
B. debit of $16,575
C. credit of $15,300
D. debit of $12,750
Answer:
$12,750.
Explanation:
Since Streuly Sales uses the straight−line method to amortize the Bond Discount, the annual discount on bonds payable can be calculated as follows:
Annual discount on bond payable = Discount on Bonds Payable ÷ Bodn duration = 15,300 ÷ 6 = 2,550
Since the interest is paid semiannually, it means the discount on bond will also be paid semiannually as calculated below:
Semiannual discount on bond payable = 2,550 ÷ 2 = $1,275
As two will be paid during 2017, one on June 30 and another on December 31, the the balance of Discount on Bonds Payable after the second interest payment on December 31, 2017 is calculated as follows:
Balance of Discount on Bonds Payable = $15,300 - (1,275 * 2) = $12,750
Therefore, the the balance of Discount on Bonds Payable after the second interest payment on December 31, 2017 is $12,750.
An automated machine fills bottles with a mean of 16 oz. and standard deviation of 0.1 oz. Assuming that Cpk index is 1 for this process, what are the lower and upper specification limits? Multiple Choice 1. lower spec = 14.3 ounces and upper spec = 17.7 ounces 2. There is insufficient information to determine the process specification. 3. lower spec = 15.7 ounces and upper spec = 16.3 ounces 4. lower spec = 12.0 ounces and upper spec = 21.4 ounces 5. lower spec = 0.1 ounces and upper spec = 1 ounce
Answer:
The correct answer is option 2.
There is insufficient information to determine the process specification.
Explanation:
There is insufficient information to determine the process specification
CpK = Min(CpU, CpL)
CpU = (Upper Specification Limit - Mean)/3*Standard Deviation
CpL = (Mean - Lower Specification Limit)/3*Standard Deviation
Hence, as both upper Specification Limit and lower specification limit is not mentioned, it cannot be measured.
The lower specification limit is approximately 15.7 ounces and the upper specification limit is approximately 16.3 ounces.
Explanation:The Cpk index is a measure of how well a process is able to consistently meet the upper and lower specification limits. It is calculated using the formula Cpk = min((USL - mean)/3σ, (mean - LSL)/3σ), where USL is the upper specification limit, LSL is the lower specification limit, mean is the mean value of the process, and σ is the standard deviation. Since the Cpk index is given as 1, we can use the formula to solve for the upper and lower specification limits.
Substituting the given mean and standard deviation into the formula, we get 1 = min((USL - 16)/(3*0.1), (16 - LSL)/(3*0.1)). Solving for USL and LSL, we find that the lower specification limit is approximately 15.7 ounces and the upper specification limit is approximately 16.3 ounces.
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4. Some economists have suggested that someday we will live in a "cashless society" in which all businesses (including stores) and banks will be linked to a centralized accounting system. In this system you will be able to pay for purchases directly from your bank account without using cash. What are the costs of anticipated inflation in a cashless society
Answer:
Anticipated inflation would cause menu costs but not shoe-leather costs.
Explanation:
Final answer:
In a cashless society, anticipated inflation may arise due to potential overexpansion of the money supply without the physical constraints of cash, leading to a decrease in purchasing power.
Explanation:
The concerns about anticipated inflation in a cashless society include the possibility that without the physical constraint of having to print and circulate cash, there might be less restraint in the creation of money, which could lead to inflation. Inflation erodes the purchasing power of money, meaning consumers can buy less with the same amount of money in their bank account. In a cashless society, this could happen more rapidly since the constraint of printing money is removed, potentially allowing for a more quick and less visible expansion of the money supply.
Banks play a crucial role in the economy by facilitating transactions and making it easier for businesses to operate without large stockpiles of cash. However, too much money in circulation, which can occur if money creation is not managed well, can lead to inflation, as seen in extreme conditions like hyperinflation.
In summary, while a cashless society can enhance efficiency and security in economic transactions, it also carries the risk of creating an environment where inflation can rapidly erode the value of money if monetary policy is not managed with great care.
Furnco manufactures desks and chairs. Each desk uses 4 units of wood, and each chair uses 3 units of wood. A desk contributes $40 to profit and a chair contributes $25. Marketing restrictions require that the number of chairs produced be at least twice the number of desks produced. There are 20 units of wood available. Furnco wants to maximize its profit. Formulate a LP model for Furnco in a spreadsheet and solve it to find out how many desks and how many chairs it should produce.
Explanation:
This is an example of a linear programming problem.
THE CONSTRAINTS
Let d, c represents number of desk and chair.
Marketing restrictions
c ≥ 2d; which can be written as
2d - c ≤0
Wood restriction
4d + 3c ≤ 20
OBJECTIVE FUCTION (MAX)
= 40d + 25c
Where d ≥ 0, c ≥ 0
With this details you can then find the solutions either graphically or using any other linear programming solution methods.
The following facts apply to the pension plan of Culver Inc. for the year 2017. Plan assets, January 1, 2017 $495,100 Projected benefit obligation, January 1, 2017 495,100 Settlement rate 8 % Service cost 43,700 Contributions (funding) 26,600 Actual and expected return on plan assets 52,100 Benefits paid to retirees 36,500 Using the preceding data, compute pension expense for the year 2017. As part of your solution, prepare a pension worksheet that shows the journal entry for pension expense for 2017 and the year-end balances in the related pension accounts. (Enter all amounts as positive.)
Answer and Explanation:
The preparation of pension worksheet is shown below:-
General Journal entries
Particulars Annual pension Cash Pension Assets/
expenses Liabilities
Service cost $43,700 Dr.
Interest cost $39,608 Dr.
(495,100 × 8%)
Actual return $52,100 Cr.
Contributions $26,600 Cr.
Journal Entry 31 Dec $31,208 Dr. $26,600 Cr. $4,608 Cr.
Balance 31 Dec 217 $4,608 Cr.
Memo record
Projected benefit obligation Plant assets
Balance Jan 1 2017 $495,100 Cr. $495,100 Dr.
Service cost $43,700 Cr.
Interest cost $39,608 Cr.
(495,100 × 8%)
Actual return $52,100 Dr.
Contributions $26,600 Dr.
Benefits $36,500 Dr. $36,500 Cr.
Balance 31 Dec 217 $541,908 Cr. $537,300 Dr.
A company’s planned activity level for next year is expected to be 100000 machine hours. At this level of activity, the company budgeted the following manufacturing overhead costs: Variable Fixed Indirect materials $140000 Depreciation $50000 Indirect labor 170000 Taxes 10000 Factory supplies 22000 Supervision 40000 A flexible budget prepared at the 90000 machine hours level of activity would show total manufacturing overhead costs of
Answer:
$398,800
Explanation:
The computation of total manufacturing overhead costs is shown below:-
Indirect material = $140,000 ÷ 100,000 × 90,000
= $126,000
Indirect labor = $170,000 ÷ 100,000 × 90,000
= $153,000
Factory supplies = $22,000 ÷ 100,000 × 90,000
= $19,800
Total manufacturing cost = Indirect material + Indirect labor + Factory supplies + Depreciation + Taxes + Supervision
= $126,000 + $153,000 + $19,800 + $50,000 + $10,000 + $40,000
= $398,800
O'Connor Company ordered a machine on January 1 at a purchase price of $120,000. On the date of delivery January 2, the company paid $30,000 on the machine and signed a long term note payable for the balance On January 3, it paid $1,200 for freight on the machine On January 5, O'Connor paid cash fo installation costs relating to the machine amounting to S7,200. On December 31 (the end of the accounting period), O'Connor recorded depreciation on the machine using the straight-line method with an estimated useful life of 10 years and an estimated residual value of $12,800 Required 1. Indicate the ellects (accounts, amounts, and for increase or decrease) of each transaction (on January 1, 2, 3, and 5) on the accounting equation.
Answer:
Explanation:
Date Assets = Liabilities + Stockholders' equity
Jan 1
Jan 2 Cash $ -30,000 Long term note payable 90,000
Machine $ 120,000
Jan 3 Machine $ 1,200
Cash -1,200
Jan 5 Machine $ 7,200
Cash -7,200
Dec. 31 Accumulated $11560
depreciation
O'Connor Company's machine purchase and subsequent costs impact the accounting equation by changing asset, liability and expense accounts. The purchase, freight, and installation costs reduce cash while increasing machinery, a long term asset. The long-term note payable increases liabilities, and annual depreciation is recorded which decreases the value of the machinery asset and is recognized as an expense.
Explanation:The events described in the question above affect O'Connor Company's accounting equation in the following ways:
On January 1, the order for a machine does not impact the accounting equation because no transaction has occurred yet.On January 2, the payment of $30,000 reduces Cash (an asset) and increases Machinery (a long term asset). The long-term note payable will increase Liabilities by the balance of $90,000. This reflects the purchase price of $120,000.On January 3, the $1,200 freight cost is also capitalized into the Machinery (asset) account and reduces Cash.On January 5, the installation cost of $7,200 is capitalized. This would reduce Cash and increase the Machinery (asset) account.On December 31, O'Connor will record depreciation. Using the straight-line method, the annual depreciation would be ($120,000 Purchase Price - $12,800 Residual Value) ÷ 10 Years = $10,720. This reduces the value of the Machinery (asset) and recognized as Expense in the Income Statement.Learn more about Accounting Equations here:https://brainly.com/question/14689492
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Engineers for The All-Terrain Bike Company have determined that a 15% increase in all inputs will cause a 15% increase in output. Assuming that input prices remain constant, you correctly deduce that such a change will cause ________ as output increases.
Answer:
the average cost to reduce
Explanation:
In this situation, when The All-terrain Bike Company increases input (capital and labor) and this causes a proportional increase in output, this scenario The All-terrain Bike Company experiences is called a constant returns to scale which gives rise to decreased average costs.
This happens because buying larger quantity of inputs gives rise to a reduced cost of purchase because these things are being bought in bulk.
Answer:
Average costs to remain constant
Explanation:
In economics, a look at the constant-cost industry reveals that total output can expanded without an increase in the individual firm's average total cost. This is because when input prices remain constant , the long-run supply curve in a constant-cost industry is perfectly elastic.
Also, since 15% increase in all inputs cause a 15% increase in output; such change shows that if input prices remain constant, average costs will remain constant too.
Diaz Company owns a milling machine that cost $126,000 and has accumulated depreciation of $92,200. Prepare the entry to record the disposal of the milling machine on January 3 in each of the following independent situations. The machine needed extensive repairs, and it was not worth repairing. Diaz disposed of the machine, receiving nothing in return. Diaz sold the machine for $17,000 cash. Diaz sold the machine for $33,800 cash. Diaz sold the machine for $40,300 cash.
Answer:
Journal Entry
Explanation:
1 Accumulated Depreciation Dr, $92,200
Loss on Disposal Dr, $34,400
To Machine Equipment $126,600
(Being disposal is recorded)
2. Cash Dr, $17,000
Accumulated Depreciation Dr, $92,200
Loss on sale/disposal Dr, $17,400
To Machine Equipment $126,600
(Being sale is recorded)
3. Cash Dr, $34,400
Accumulated Depreciation Dr, $92,200
Machine Equipment $126,600
(Being sale is recorded)
4. Cash Dr, $40,300
Accumulated Depreciation Dr, $92,200
To Gain on sale/disposal $5,900
To Machine Equipment $126,600
(Being sale is recorded)
On February 1, 2020, Waterway Industries purchased a parcel of land as a factory site for $310000. An old building on the property was demolished, and construction began on a new building which was completed on November 1, 2020. Costs incurred during this period are listed below:
Demolition of old building $ 20700
Architect's fees 34700
Legal fees for title investigation and purchase contract 4500
Construction costs 1378000
(Salvaged materials resulting from demolition were sold for $8600.)
Required:
a) Waterway should record the cost of the land and new building, respectively, as _____________.
Answer:
Waterway should record the cost of the land as $322,100 and new building as $1,412,700
Explanation:
In order to calculate the cost of the land we would have to make the following calculation:
cost of the land= purchased of land+Demolition of old building+Legal fees-Salvaged materials sold
cost of the land=$310,000+$ 20,700+4,500-$8,600
cost of the land=$322,100
In order to calculate the cost of the new building we would have to make the following calculation:
cost of the new building=Architect's fees+Construction costs
cost of the new building=$34,700+$1,378,000
cost of the new building=$1,412,700
The interest rate charged to AAA corporate borrowers is 7.8% for 5 year bonds. The interest rate charged to BBB corporate borrowers is 8.8% for five year bonds. The onferences between these two rates of interest can best be explained by the following factors.
a. Inflation and Maturity Risk
b. Maturity Risk and Default Risk
c. Default Risk and Liquidity Risk
d. Liquidity Risk and Inflation me. Inflation and Default Risk
Answer:
Answer is option c.
Default Risk and Liquidity Risk
Explanation:
Default risk - because AAA and BBB differ in credit quality Liquidity risk - because BBB could potentially have lower liquidity than AAA bond (more stable and could be more traded)A company began the year with Property and Equipment costing $680,000 and accumulated depreciation of $120,000. The only change affecting the long-lived assets account during the year is the $55,000 of depreciation expense that must be recorded for the year. What is the amount of Property and Equipment, net, to be reported on the balance sheet at the end of the year
Answer:
$505,000
Explanation:
Data provided as per the question
Cost = $680,000
Accumulated depreciation =$120,000
Depreciation = $55,000
The computation of amount to be reported at end of year is given below:-
Amounted to be reported at end of year = (Cost - Accumulated depreciation)-Depreciation
= ($680,000 - $120,000) - $55,000
= $560,000 - $55,000
= $505,000
Suppose now that market demand for skiing increases to Qᴅ = 9000 − 60p because of environmental regulations neither Pepall Ridge nor Snow Richards can increase their capacities and serve more skiers beyond their current level of 1,800.
What is the Nash equilibrium price outcome for this case? The constant marginal cost is 10.
Answer:
they both produce the same thing
Explanation:
check the picture attached below for the full explanation.
The Nash equilibrium price when the market demand for skiing is Qᴅ = 9000 - 60p and both Pepall Ridge and Snow Richards have a capacity of 1,800 skiers, with a constant marginal cost of $10, is $90.
Explanation:The question is from the field of economics, specifically the study of market demand, supply, and pricing strategies. We're given a market demand equation Qᴅ = 9000 - 60p and a fixed capacity of 1,800 for each of the two suppliers, Pepall Ridge and Snow Richards. The marginal cost is $10 constant.
To find the Nash equilibrium price, we set the market quantity demanded equal to the total quantity supplied. The total supply in the market is 1,800 skiers from each resort, or 3600 skiers. So, we set 9000 - 60p = 3600, resulting in a value of p = 90.
Thus, the Nash equilibrium price under these conditions is $90, with each resort accommodating 1,800 skiers.
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During the year, Wright Company sells 470 remote-control airplanes for $110 each. The company has the following inventory purchase transactions for the year. Date Transaction Number of Units Unit Cost Total Cost Jan. 1 Beginning inventory 60 $ 82 $ 4,920 May. 5 Purchase 250 85 21,250 Nov. 3 Purchase 200 90 18,000 510 $ 44,170 Calculate ending inventory and cost of goods sold for the year, assuming the company uses weighted-average cost.
Answer:
Units of inventory = 40 units
Value the closing inventory = $ 3,464.31
Cost of goods sold = $40,705.69
Explanation:
To value inventory, The weighted average inventory method uses the value of weighted average price of all the batches purchased till date. The weighted average price is re-computed whenever a new batch of stock is received.
Weighted average cost = Total value of stock/ Total units
Step 1
Calculate the weighted average price
For Wright, we can work out the weighted average price as follows:
Weighted average cost = Total value of stock/ Total units
The total quantity purchased plus opening inventory before sales is 510 units
step 1
Weighted average price
= $44,170/ 510 units
= $86.607
Step 2
Calculate the closing inventory units
Closing inventory = opening inventory + purchases - sales
=510-470
= 40 units
Step 3
Value the closing inventory
= 40 × $86.60784314
= $ 3,464.31
step 4
Cost of goods sold
= 470 × $86.60
= $40,705.69
Units of inventory = 40 units
Value the closing inventory = $ 3,464.31
Cost of goods sold = $40,705.69
The weighted-average cost per unit for the Wight Company is around $86.61. With 40 unsold units, the ending inventory is valued at about $3,464.4. The cost of goods sold for the year is approximately $40,705.7.
Explanation:The Wright Company's financial year includes three inventory purchase transactions dating from January to November. With a total inventory of 510 units and a total cost of $44,170, you can calculate the weighted-average cost per unit by dividing the total cost by the total number of units. This results in a cost of approximately $86.61 per unit.
To determine the ending inventory, multiply the number of unsold units (510 units bought - 470 units sold = 40 units) by the weighted-average cost per unit (40 units * $86.61 = approximately $3,464.4). Hence, the ending inventory is valued at around $3,464.4.
The cost of goods sold (COGS) is then determined by multiplying the number of units sold by the weighted-average cost per unit (470 units * $86.61 = approximately $40,705.7). Hence, for that financial year, the COGS is around $40,705.7.
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On January 22, Zentric Corporation issued for cash 160,000 shares of no-par common stock at $8. On February 14, Zentric issued at par value 45,000 shares of preferred 2% stock, $50 par for cash. On August 30, Zentric issued for cash 10,000 shares of preferred 2% stock, $50 par at $56. Journalize the entries to record the January 22, February 14, and August 30 transactions. If an amount box does not require an entry, leave it blank.
Answer:
Jan 22
Dr Cash 1,280,000
Cr Common stock 1,280,000
Feb 15
Dr Cash 2,250,000
Cr Preferred stock 2,250,000
Aug 30
Dr Cash 560,000
Cr Preferred stock 500,000
Cr Paid in capital in excess of par value-Preferred stock 60,000
Explanation:
Journal entry
Jan 22
Dr Cash 1,280,000
(160,000 shares of no-par common stock × $8.)
Cr Common stock 1,280,000
Feb 15
Dr Cash 2,250,000
(45,000 shares ×$50 par for cash)
Cr Preferred stock 2,250,000
Aug 30
Dr Cash (10000*56) 560000
Cr Preferred stock (10000*50) 500000
Cr Paid in capital in excess of par value-Preferred stock 60000
Rhone-Rohrer Chemicals, a French leader in specialty chemicals used an ethnocentric policy to approach international markets. It followed the same domestic marketing and management practices in foreign markets. Rhone-Rohrer Chemicals' international expansion failed miserably because Rhone-Rohrer Chemicals suffered from:
Answer:
Cultural Myopia
Explanation:
Myopia in general refers to short sightedness.
A Cultural myopia refers to the belief that one's own culture is better suited and apt in all situations and circumstances and applies to all people.
In business context, this conveys the inability of a firm to adopt or modify it's product strategies as per the market conditions of a foreign nation, thereby providing standardized or same products and services as it provides in it's own domestic market.
For instance, Heinz provides different variants of it's ketchups across the globe, incorporating changes and modifications in ingredients as would better suit a market and better cater to it's needs. The company for instance provides ketchup without onion and garlic as ingredients to suit Indian market requirements.
In the given case, the chemical company applied the same French ethnocentric policies in international markets and followed the same domestic marketing policies internationally. Thus, it's expansion move failed miserably since it failed to adapt to the requirements of global markets and could not cater to them effectively.
Final answer:
Rhone-Rohrer Chemicals failed in international markets due to an ethnocentric policy, which resulted in a lack of local responsiveness and the use of ineffective strategies.
Explanation:
Rhone-Rohrer Chemicals, a French leader in specialty chemicals, decided to use an ethnocentric policy for their international expansion. This means that they applied the same domestic marketing and management practices in foreign markets without considering local cultural differences, consumer preferences, or business practices. Rhone-Rohrer Chemicals' international expansion failed because they suffered from a lack of local responsiveness. An ethnocentric approach often results in ineffective marketing strategies and poor management decisions in the international context.
A(n) ____________ new entry is used by entrepreneurs who see products or business concepts that have been successful in one market niche and introduce the same product in another segment of the market.
Answer:
imitative new entry
Explanation:
Imitative new entry strategy is used by entrepreneur to copy any existing successful business model and implement it in the other market. When any resourceful business entity sees that any product or service is successful in one of the markets then they try to imitate the success of same product in by introducing other market segment.
This helps the business to save finances in research and development, marketing and consumer awareness of product. Moreover, this strategy ensures that there is less scope of failure as the success of product is proven in one segment. It also helps them to improve upon the existing product to make it more consumer attractive.
Since in the problem stated one successful business concept is being introduced in other segment of market. It clearly suggest that it is an imitative new entry strategy.
Identify the three criteria you consider to be most important in determining whether or not a system is a quality system. Briefly discuss your rationale for selecting these criteria.
Answer:
Quality Management 3 criterias : Comprehensiveness, Simplicity, Risk Management
Explanation:
Quality Management is very good for fulfilling quality management needs of organisation.
Important criterions of determining quality system ; is that it adds value in under mentioned ways :
Complete, comprehensive solution : The tool should not be in broken parts for various functions. It should have good degree of integration for comprehending various business tasks , for complete development Simple use : The user experience should be very clear & simple, free from any chaos. This will ensure proper process visibilityRisk Management : Businesses have to face many uncertainties, so risk management is very important part, to ensure sustainable developmentA system is said to be quality if its high accuracy in its operations, Compliance with applicable standards of procedures and has high customer satisfaction.
Criteria of a Quality BuisnessIn business, A system is regarded as being Quality if it has these 3 criteria:
high accuracy in its operations Compliance with applicable standards of procedures high customer satisfaction. Accuracy in its operations:When a business is accurate and precise in its operations whether in production or in service, it makes such a business to save time( reduces repetition) , function efficiently and increase profit. Accuracy in business helps a company have good and proper estimations for projections in revenue.For example, any data provided must be accurate, This gives credibility. These data values must be accurate and provided in an unambiguous and consistent form.
Compliance with applicable standards of procedures:A quality business adheres to standards of procedures to operate and does not rigmarole to the end product or service. It follows step by step procedures or guidelines understanding that once there is a meander from the procedures, a problem results causing non-uniformity, a red flag.
High customer satisfaction.:A quality business leads to a growing one are more likely to be prioritize by customers. Customer satisfaction is key for every business cause it leads to more recommendation and therefore improved revenue.
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