Final answer:
The contribution margin per unit is calculated by subtracting all variable costs from the selling price per unit, resulting in $9.70.
Explanation:
To calculate the contribution margin per unit, we need to subtract the variable costs from the selling price per unit. The selling price provided is $22.30 per unit. Looking at the average costs per unit, we have direct materials at $6.30, direct labor at $3.80, variable manufacturing overhead at $1.50, and sales commissions at $1.00. The total variable cost per unit is the sum of these, which is $6.30 + $3.80 + $1.50 + $1.00 = $12.60. Therefore, the contribution margin per unit is $22.30 - $12.60 = $9.70.
Johnny Appleseed Brewing Company (JABC) has a quick ratio of 2.00; $38,250 in cash; $21,250 in accounts receivable; some inventory; total current assets of $85,000; and total current liabilities of $29,750. In its most recent annual report, JABC reported annual sales of $100,000 and a cost of goods sold equal to 65% of annual sales. How many times is Johnny Appleseed Brewing Company (JABC) selling and replacing its inventory? 0.35x 2.805x 3.92x 2.55x
Final answer:
Henry's accounting profits would be $55,000, while his economic profits would be $38,000 after considering opportunity costs. He should open the microbrewery as the economic profit is positive. The indifference rate of return is 38%, making the microbrewery a favorable investment compared to a 7% return on savings.
Explanation:
Accounting profits are the net income of a business, calculated as total revenues minus explicit costs. In Henry's case, accounting profits can be calculated by subtracting all costs from the total sales revenues. If we consider his salary as part of his costs, the accounting profit would be:
Total Sales Revenue: $55,000 (surplus) + $40,000 (salary) = $95,000
Accounting Profits: $95,000 total revenue - $40,000 salary = $55,000
Calculation of Economic Profits
Economic profits take into account both explicit and implicit costs. Implicit costs include the opportunity cost of the owner's investment and forgone salary. To calculate the economic profits, subtract the opportunity cost of the savings and the forgone salary from Henry's accounting profits.
Opportunity Cost of Savings: 7% of $100,000 = $7,000
Forgone Salary: $50,000 - $40,000 = $10,000
Economic Profits: $55,000 - $7,000 - $10,000 = $38,000
Decision on Opening the Microbrewery
To determine if Henry should open the microbrewery, we compare his economic profit to his current situation. If the economic profit is positive, it indicates that he's better off opening the microbrewery compared to his current job. In this case, Henry's economic profit is $38,000, which is positive, suggesting that it would be beneficial for him to open the microbrewery.
Indifference Rate of Return
To find the rate of return that would make Henry indifferent between opening the microbrewery and not, we need to find the rate at which the opportunity cost of his savings equals the economic profit estimated from the microbrewery.
Indifference Rate of Return: Economic profit / Investment = $38,000 / $100,000 = 38%.
This rate is substantially higher than the current 7%, suggesting that at any rate below 38%, the microbrewery would be the more attractive option.
Some persons are counted as out of the labor force because they have made no serious or recent effort to look for work. However, some of these individuals may want to work even though they are too discouraged to make a serious effort to look for work. If these individuals were counted as unemployed instead of out of the labor force, then
a. both the unemployment rate and labor-force participation rate would be higher.
b. the unemployment rate would be higher ,and the labor-force participation rate would be lower.
c. the unemployment rate would be lower, and the labor-force participation rate would be higher.
d. both the unemployment rate and labor-force participation rate would be lower.
Answer:
The correct answer is A: both the unemployment rate and labor-force participation rate would be higher.
Explanation:
The unemployment rate is the share of the labor force that is jobless, expressed as a percentage. To calculate the unemployment rate, the number of unemployed people is divided by the number of people in the labor force, which consists of all employed and unemployed people. It defines unemployed people as those who are willing and available to work, and who have actively sought work.
By increasing the number of people unemployed, the number of employed people is now divided by a larger base. Meaning that the unemployment rate increases.
The labor force participation rate measures an economy's active labor force and is the sum of all employed workers divided by the working-age population. It refers to the number of people who are either employed or are actively looking for work. The number of people who are no longer actively searching for work would not be included in the participation rate.
By increasing the number of people of unemployed people, they will be considered as people that are actively looking for work. Meaning that labor force participation increases.
All discouraged workers are counted as unemployed, both the unemployment rate and the labor-force participation rate would increase because these individuals are added both to the unemployed count and the total labor force count.
Explanation:The correct answer to this question is (a). If individuals who are too discouraged to make a serious effort to look for work were counted as unemployed instead of out of the labor force, both the unemployment rate and the labor-force participation rate would be higher. This is because the unemployment rate is a ratio that compares the number of unemployed individuals to the total labor force. Meanwhile, the labor-force participation rate measures the total number of individuals who are either employed or actively looking for work, as a percentage of the working-age population. Therefore, counting these discouraged workers as unemployed would add to both the number of people counted as unemployed and those considered as part of the labor force, raising both rates.
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CrochetCo is considering an investment in a project which would require an initial outlay of $350,000 and produce expected cash flows in years 1-5 of $95,450 per year. You have determined that the current after-tax cost of the firm's capital (required rate of return) for each source of financing is as follows:Cost of Long-Term Debt7%Cost of Preferred Stock11%Cost of CommonStock15%Long-term debt currently makes up 25% of the capital structure, preferred stock 15%, and common stock 60%. What is the net present value of this project?A) -$9,306B) $2,149C) $5,983D) $11,568
Answer:
Ans. A) NPV= -$9306
Explanation:
Hi, the first thing we need to do is to find the after-tax cost of the firm's capital, and since all capital sources are expressed in terms of after-tax percentage, we just multiply each proportion of capital by its costs, I mean
Long term Debt (7%) * 25% +Preffered Stock(11%)*15% + Common Stock(15%)*60%
The answer to this is 12.40%.
Now, we can find the net present value of this project by using the following formula.
[tex]NPV=-InitialOutlay+\frac{CashFlow((1+Cost of Capital)^{n} -1)}{Cost of Capital(1+Cost of Capital)^{n}}[/tex]
[tex]NPV=-350,000+\frac{95,450((1+0.124)^{5} -1)}{0.124(1+0.124)^{5}} =-9,306.5[/tex]
Since the expected cash flow takes place 5 times form year 1 to 5, and is equal to $95,450, "n" is equals to 5 and "CashFlow" is equal to $95,450.
Therefore, the NPV of this project is -$9,306, which is answer A)
Best of luck.
Which of the following is NOT one of the strategies incorporated in the Sarbanes-Oxley Act of 2002?
(A) Establish compliance programs
(B) Establish ethics programs
(C) Dictate maximum compensation levels
(D) Attain greater board independence
Answer: Option (C) is correct.
Explanation:
Sarbanes-Oxley Act was ratified under the assumption that it will bring down organization fraud. It is also responsible for creation of PCAOB also known as Public Company Accounting Oversight Board which was created to oversee accounting industry. It also denied organization loans to executive and also gave employment protection to so called whistle-blowers. This Act is thoroughly responsible for strengthening independence and the financial literacy of organizations boards.
The labor force is comprised of those who are working for any number of hours (the employed) and those who are out of work but actively looking for a job (the unemployed). Calculate the size of the labor force. The size of the adult population is 30,000. The number working is 17,700 and the number of unemployed actively looking for work is 1,600. a. Labor Force: people A commonly reported labor statistic is the Labor Force Participation Rate 'LFPR':
Answer:
Labor force 19,300
Labor Force participation Rate: 64.33%
Explanation:
working population 17,700
unemployed actively looking for work 1,600
Total Labor Force 19,300
Labor Force Participation Rate (LFPR):
It is the quotient between the Labor force and the total number of people eligible for a job
19,300/30,000 = 0.6433 = 64.33%
This will be the percentage of the population over 16 year which, are actively looking for a job or are already hired in one.
How should a "gain" from the sale of treasury stock be reflected when using the cost method of recording treasury stock transactions?
a. As ordinary earnings shown on the income statement.
b. As paid-in capital from treasury stock transactions.
c. As an increase in the amount shown for common stock.
d. As an extraordinary item shown on the income statement.
Answer:
b. As paid-in capital from treasury stock transactions.
Explanation:
No gain is recognize when selling stock, as this represent contribution to the company from the stockholders. This is not a gain for the company is just a contribution.
The treasury stock will be write-off, cash will be debited for the amount received and then, any difference will be settle by debiting or crediting the paid-in capital from Treasury Stock.
Bella is 23 years old and wants to invest money for her retirement. She wants to have $2,000,000 saved up when she retires at age 65. a) If she can earn 10% per year in an equity mutual fund, calculate the amount of money she would have to invest in equal annual amounts to achieve her retirement goal. be) Alternatively, how much would she have to invest in equal monthly amounts starting at the end of the current year or month respectively. c) Looking at these numbers, most people would think this is affordable. Why do you think most Americans are not saving for their retirement
Answer:
A) If Bella contributes 3,719.98 per year during 42 years it will get 2,000,000
B) 258.25 if the payment are monthly
C) Because, the retirement is a long-run reward while spending the income in the younger years may be seens as better deal for most americans n my humble opinion.
Explanation:
we will calculate which annuity will equal a future value 2,000,000 at 10% in the period of time from 23 years to 65 years:
[tex]FV \div \frac{(1+r)^{time} -1}{rate} = C\\[/tex]
PV $2,000,000.00
time 42 (65 years - 23 years )
rate 10% = 10/100 = 0.1
[tex]2000000 \times \frac{(1+0.1)^{42} -1}{0.1} = C\\[/tex]
C $ 3,719.98
If Bella contributes 3,719.98 per year during 42 years it will get 2,000,000
IF the payment are monthly, we will increase time and adjust the rate:
[tex]PV \div \frac{1-(1+r)^{-time} }{rate} = C\\[/tex]
PV $2,000,000.00
time 504 (42 years x 12 months per year)
rate 0.008333333 (0.1 / 12 months per year)
[tex]2000000 \times \frac{1-(1+0.008333)^{-504} }{0.008333} = C\\[/tex]
C $ 258.25
Vaughn Manufacturing is a private camping ground near the Mount Miguel Recreation Area. It has compiled the following financial information as of December 31, 2017. Service revenue (from camping fees) $168,960 Dividends $11,520 Sales revenue (from general store) 32,000 Notes payable 64,000 Accounts payable 14,080 Expenses during 2017 161,280 Cash 10,880 Supplies 7,040 Equipment 145,920 Common stock 51,200 Retained earnings (1/1/2017) 6,400 Determine Vaughn Manufacturing’s net income for 2017. Vaughn Manufacturing’s net income for 2017 $enter a net income amount
Answer:
The Vaughn Manufacturing’s net income for 2017 is $39,680
Explanation:
The computation of the net income is shown below:
In simple form, the net income equals to
= Total revenue - total expenditure
= Service revenue (from camping fees) + Sales revenue (from general store) - Expenses during 2017
= $168,960 + $32,000 - $161,280
= $39,680
The other items which are mentioned in the question are irrelevant. Therefore, these are ignored for the computation part
What would be the net annual cost of the following checking accounts? (a) Monthly fee, $3.25; processing fee, $0.35 cents per check; checks written, an average of 20 a month. (Do not round intermediate calculations. Input the answer as a positive value. Round your answer to 2 decimal places.)
Answer:
Total annual cost= $123
Explanation:
Giving the following information we need to calculate the annual cost:
Fixed monthly cost= $3.25
Variable cost= $0.35 per check
Q=20 month
Total annual cost= Fixed monthly cost*12+ (Variable cost*20)*12
Total annual cost= (3,25*12)+(0,35*20)*12= $123
Final answer:
The net annual cost of the checking account with a monthly fee of $3.25 and a processing fee of $0.35 per check, with an average of 20 checks written per month, is $123.00.
Explanation:
To calculate the net annual cost of a checking account with a monthly fee and a per-check processing fee, we need to consider both the fixed monthly cost and the variable cost dependent on the number of checks written. The question specifies a monthly fee of $3.25 and a processing fee of $0.35 per check, with an average of 20 checks written per month.
Calculating the Annual Cost
Monthly Fee: Since the monthly fee is consistent, we multiply it by 12 to find the annual cost from this portion. Monthly fee = $3.25, so Annual fee from monthly charges = $3.25 * 12 months = $39.00.Processing Fee: To find the annual cost from processing fees, we calculate the cost per month and then multiply by 12. The processing fee per check is $0.35, and with 20 checks per month, the monthly cost from processing fees is $0.35 * 20 = $7.00. Therefore, the Annual fee from processing charges = $7.00 * 12 months = $84.00.Total Annual Cost: We sum the annual cost from monthly fees with the annual cost from processing fees to find the net annual cost. Total Annual Cost = $39.00 (from monthly fees) + $84.00 (from processing fees) = $123.00.The net annual cost of the checking account is $123.00.
At the end of its first month of operations, Michael’s Consulting Services reported net income of $25,000. They also had account balances of: Cash, $18,000; Office Supplies, $2,000 and Accounts Receivable $10,000. The sole stockholder’s total investment in exchange for common stock for this first month was $5,000. There were no dividends in the first month. Calculate the amount of total equity to be reported on the balance sheet at the end of the month.
Answer:
30,000
Explanation:
we solve usign the accounting equation
Assets = Liabilities + Equity
Assets:
cash 18,000
account receivable 10,000
supplies 2,000
Total 30,000
As there are no debt, equity will be equal to total assets.
30,000 = 0 + Equity
Equity = 30,000
A track dozer cost $165,500 to purchase. Fuel, oil, grease, and minor maintenance are estimated to cost $35.00 per operating hour. A major engine repair costing $26,000 will probably be required after 7,200 hr of use. The expected resale price (salvage value) is 21% of the original purchase price. The machine is expected to have a useful life of 10,800 hr. How much should the owner of the machine charge per hour of use, if it is expected that the machine will operate 1,800 hr per year? The company's cost- of-capital rate is 7.3%.
Answer:
It will charge 54.22 per hour to obtain a yield of 7.3% on the track dozer.
Explanation:
purchase cost 165,500
repair costing 26,000 at year 4
annual cost: 1,800 x 35 = 63,000
salvage value at end of useful life:
21% of purchase cost :
21% of 165,500 = 34,755
We will calculate the present value of the salvage value and the overhaul, to know how much does the company need to generate per year:
165,000 + pv of overhaul + pv of salvage value = present value of the cash inflow
pv of the overhaul
[tex]\frac{overhaul}{(1 + rate)^{time} } = PV[/tex]
overhaul: 26,000
time 4
rate 0.073
[tex]\frac{26000}{(1 + 0.073)^{4} } = PV[/tex]
PV $19,614.3744
Then, the PV of the salvage value:
[tex]\frac{salvage}{(1 + rate)^{time} } = PV[/tex]
salvage 34,755
time 6
rate 0.073
[tex]\frac{34755}{(1 + 0.073)^{6} } = PV[/tex]
PV $22,772.9326
165,500 + 19,614.3744-22,772.9326 = 163,341.4418
The present value of the contribution per hour at 7.3% discount rate should equal this amount
So we will set up the formula for the cuota of an annuity:
[tex]PV \div \frac{1-(1+r)^{-time} }{rate} = C\\[/tex]
PV $163,341.44
time 6
rate 0.073
[tex]-34586.3538411519 \div \frac{1-(1+0.073)^{-6} }{0.073} = PV\\[/tex]
C 34,586.35
The contribution per year should be 34,586.35
each hour contribution should be: 34,586.35/1,800 = 19.2146
After the operating cost it should net 19.2146
hourly rate - 35 = 19.2146
hourly rate = 19.2146 + 35 = 54.2146 = 54.22
The owner of the track dozer should charge about $49.5 per hour to cover all associated costs and maintain the company's cost of capital rate of 7.3%.
Explanation:First, you need to calculate the total costs associated with the dozer over its expected life. The initial cost is $165,500. The ongoing costs are $35/hour for 10,800 hours, which equals $378,000. Now, the major maintenance cost of $26,000 should be included. So, the total cost at this point is $569,500 ($165,500 + $378,000 + $26,000).
However, at the end of its life, expect to be able to sell (salvage) the dozer for 21% of its original value, which is $34,755. So, subtract the salvage value from the total costs, producing a figure of $534,745. The owner needs to recover this cost over the life of the dozer.
The machine is expected to operate 1,800 hr per year. Then, divide the total cost ($534,745) by the total number of operating hours (10,800 hours). Thus, the owner should charge about $49.5 per hour to cover the total costs and maintain the company's cost of capital rate of 7.3%.
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The year-end financial statements of Calloway Company contained the following elements and corresponding amounts: Assets = $27,000; Liabilities = ?; Common Stock = $5,700; Revenue = $12,400; Dividends = $1,100; Beginning Retained Earnings = $4,100; Ending Retained Earnings = $7,700. The amount of liabilities reported on the end of period balance sheet was ?
Answer:
The amount of liabilities reported on the end of period balance sheet was:
$ 13.600
Explanation:
Retained Earnings Report
Opening retained earnings $ 4.100
Add: Net Income $ 4.700
Subtotal $ 8.800
Less: Dividends -$ 1.100
Total $ 7.700
TOTAL ASSETS $27.000
TOTAL LIABILITIES $13.600
Common Stock $5.700
Retained Earnings $7.700
TOTAL EQUITY $13.400
The amount of liabilities reported on the end-of-period balance sheet can be calculated using the accounting equation. In this case, the liabilities are $17,700.
Explanation:The amount of liabilities reported on the end of period balance sheet can be calculated by using the accounting equation: Assets = Liabilities + Equity. We are given the following information: Assets = $27,000, Common Stock = $5,700, Revenue = $12,400, Dividends = $1,100, Beginning Retained Earnings = $4,100, and Ending Retained Earnings = $7,700. We can calculate the Liabilities as follows:
Calculate the change in Retained Earnings: Ending Retained Earnings - Beginning Retained Earnings = $7,700 - $4,100 = $3,600Calculate the Net Income: Revenue - Expenses - Dividends = $12,400 - Expenses - $1,100. Since we are not given the Expenses, we cannot calculate the Net Income.We know that Assets = Liabilities + Equity, and Equity = Common Stock + Retained Earnings. Therefore, $27,000 = Liabilities + ($5,700 + $3,600). Solving for Liabilities, we get Liabilities = $27,000 - $9,300 = $17,700Therefore, the amount of liabilities reported on the end-of-period balance sheet is $17,700.
B Corporation uses the weighted-average method in its process costing system. The Assembly Department started the month with 4,000 units in its beginning work in process inventory. An additional 66,000 units were transferred in from the prior department during the month to begin processing in the Assembly Department. There were 28,000 units in the ending work in process inventory of the Assembly Department that were 60% complete with respect to conversion costs. What were the equivalent units for conversion costs in the Assembly Department for the month?
Answer:
W-A equivalent units for conversion cost: 58,800
Explanation:
Under weighted average we will calculate equivalent untis as follows:
the complete units + completion in ending WIP
Calculations for complete units:
beginning WIP: 4, 000
transferred-in: 66, 000
Total 70, 000
Ending WIP (28,000)
Complete units 42,000
Calculation for completion of WIP
ending WIP x percentage of completion
28,000 x 60% = 16,800
Equivalent units
42,000 + 16,800 = 58,800
Suppose Powers Ltd., just issued a dividend of $1.20 per share on it common stock. The company paid dividends of $.85, $.92, $.99, and $1.09 per share in the last four years. If the stock currently sells for $53, what is your best estimate of the company's cost of equity capital using arithmetic and geometric growth rates?
Answer: 11.48%; 11.47%
Explanation:
Given that,
Dividend Issued on common stock = $1.20 per share
Dividend paid in last four years:
$.85 per share
$.92 per share
$.99 per share
$1.09 per share
Stock currently sells at = $53
Calculation of growth rates in dividends :
G1 = [tex]\frac{0.92-0.85}{0.85}[/tex]
= 8.24%
G2 = [tex]\frac{0.99-0.92}{0.92}[/tex]
= 7.6%
G3 = [tex]\frac{1.09-0.99}{0.99}[/tex]
= 10.1%
G4 = [tex]\frac{1.20-1.09}{1.09}[/tex]
= 10.09%
(1) Arithmetic growth Rate = [tex]\frac{8.24+7.6+10.1+10.09}{4}[/tex]
= 9.01%
Cost of Equity = [tex]\frac{(1.20)(1.0901)}{53}+0.0901[/tex]
= 11.48%
(2) Geometric growth Rate
[tex]1.20=0.85(1+g)^{4}[/tex]
G = 9%
Cost of Equity = [tex]\frac{(1.20)(1.09)}{53}+0.09[/tex]
= 11.47%
A company hires you to develop a linear regression forecasting model. Based on the company's historical sales informationτ, you determine the intercept value of the model to be 1,200.You also find the slope value is -.50. If after developing the model you are given a value of X = 10, which of the following is the resulting forecast value using this model?A. - 3,800B. 700C. 1,700D. 1,040E. 12,000
Answer:
B. 700
Explanation:
the general linear equation formula is as follow:
[tex]y = mx + h[/tex]
Where h is the value at which the formula intercept the Y axis
And m is the slope value, therefore:
[tex]y = -50x + 1,200[/tex]
if x = 10
[tex]y = -50(10) + 1,200[/tex]
y = -500 + 1,200
y = 700
This will be the value of the formula when x = 10
The Computer Store had the following revenue and expenses during the month ended July 31. Fees for computer repairs $ 41,600 Advertising expense 5,700 Salaries expense 18,500 Telephone expense 850 Fees for printer repairs 5,950 Utilities expense 1,300 Did the firm earn a net income or incur a net loss for the period? What was the amount?
The firm earned a net income of $21,200 for the period.
Explanation:The firm earned a net income for the period. To determine the net income, we need to calculate the total revenue and total expenses. The total revenue is obtained by adding the fees for computer repairs and fees for printer repairs, which gives us -
= $41,600 + $5,950
= $47,550.
The total expenses are obtained by adding the advertising expense, salaries expense, telephone expense, and utility expense, which gives us -
$5,700 + $18,500 + $850 + $1,300 = $26,350.
Net income is calculated by subtracting total expenses from total revenue, so -
= $47,550 - $26,350
= $21,200.
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Which of the following statements is true? Free trade causes contraction of the export-oriented sector. Free trade causes contraction in the import-competing sector. Free trade restricts consumption choices of the domestic consumers. All the domestic producers benefit when a country engages in free trade.
Answer:
The correct answer is: Free trade causes contraction in the import-competing sector.
Explanation:
Free trade implies no or very low restrictions on trade between countries. These restrictions may be tariffs, quotas, permits, licenses, etc.
Free trade means that foreign producers will be able to sell their products in the domestic market easily. So it will increase competition in the sector that is competing with foreign producers. Or in other words, we can say that it will lead to a contraction in the import-competing sector.
This happens because domestic producers have to face competition from foreign producers. We are aware that a country exports the good it specializes in producing. So obviously foreign producers specialize in that product. This will lead to a contraction in the domestic market for the good.
Tamarisk, Inc. sells merchandise on account for $2600 to Morton Company with credit terms of 2/7, n/30. Morton Company returns $1100 of merchandise that was damaged, along with a check to settle the account within the discount period. What entry does Tamarisk, Inc. make upon receipt of the check?
Answer:
cash 1,470
sales discount 30
return goods 1,100
sales revenue 2,600
to record payment received from Morton Company
Explanation:
on sale:
account receivable 2,600
sales revenue 2,600
we analize the commercial terms:
2/7 within the first 7 days, paying the invoice generates a 2% discounts
n/30 after that, until 30 days pays the nominal amount
balance at payment date:
sales for 2,600
returned goods: (1,100)
balance 1,500
discount 1,500 x 2% = 30
journal entry:
cash 1,470 (1,500 nominal - 30 discount)
sales discount 30
return goods 1,100
sales revenue 2,600
Which of the following statements are true with regards to asset accounts? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Assets are on the left-side of the accounting equation. unanswered Assets are on the right-side of the accounting equation. unanswered Assets are increased with debits. unanswered Assets are increased with credits. unanswered Assets are decreased with debits. unanswered Assets are decreased with credits. unanswered
Answer:
True Statements are as follows:
Assets are on the left-side of the accounting equation.
As the accounting equation is as follows:
Assets = Liabilities + Stockholder's Equity.
Assets are increased with debits.
All the assets have debit balance and therefore, it increases with debit balance and decreases with credit balance.
Assets are decreased with credits.
As assets have debit balance, it increases with a debit and decreases with each credit, as for example with depreciation balance of fixed assets are decreased.
The correct statements about Assets are:
Assets are on the left-side of the accounting equation.Assets are increased with debits.Assets are decreased with credits.Therefore, options, A, C, and F are correct.
Assets encompass a diverse spectrum of tangible and intangible resources held by individuals, businesses, or entities, serving as the bedrock of economic value. These encompass physical properties such as cash, real estate, and machinery, along with intangibles like patents and goodwill.
Assets embody economic potential, capable of generating future benefits or yielding financial returns. Their classification as current or non-current aids in gauging liquidity and long-term viability.
In the intricate mosaic of financial analysis, assets represent the building blocks (Assets = Liabilities + Equity) upon which financial health, investment decisions, and economic prosperity are intricately woven.
Therefore, options, A, C, and F are correct.
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Woodcarving Co. incurred the following costs during May: Conversion costs $ 476,500 Prime costs 403,750 Manufacturing overhead 320,500 What was the amount of direct materials and direct labor used in May? Direct materials Direct labor A. $ 111,000 $ 292,750 B. $ 116,000 $ 209,500 C. $ 247,750 $ 156,000 D. $ 81,000 $ 86,000
Answer:
The correct answer is C
Explanation:
With the following information, we need to calculate the direct materials and direct labor:
Woodcarving Co. incurred the following costs during May:
Conversion costs $ 476,500
Prime costs 403,750
Manufacturing overhead 320,500
We know that:
Conversion cost= direct labor + Manufacturing overhead
476500= direct labor + 320500
direct labor= $156000
Prime costs= direct materials + direct labor
403750= direct materials + 156000
direct labor= $247750
Final answer:
The amount of direct materials used by Woodcarving Co. in May was $247,750, and the amount of direct labor was $156,000. These were calculated by using the given prime costs and conversion costs, and deducting the value of manufacturing overhead.
Explanation:
The question asks to find the amount of direct materials and direct labor used by Woodcarving Co. in May, given the costs of conversion, prime, and manufacturing overhead. To find these amounts, we need to understand that prime costs consist of direct materials plus direct labor, and conversion costs consist of direct labor plus manufacturing overhead.
If we denote direct materials as DM, direct labor as DL, and manufacturing overhead as MO, then we have the following relationships:
Prime costs (PC) = DM + DLConversion costs (CC) = DL + MOManufacturing Overhead (MO) is given as $320,500Using the provided numbers:
PC = $403,750CC = $476,500MO = $320,500We can calculate direct labor (DL) by rearranging the conversion costs equation:
DL = CC - MO
DL = $476,500 - $320,500
DL = $156,000
Now plug in the value of DL into the prime costs equation to find DM:
DM = PC - DL
DM = $403,750 - $156,000
DM = $247,750
So, the amount of direct materials used in May was $247,750 and the amount of direct labor was $156,000.
JWS Transport Company’s employees earn vacation time at the rate of 1 hour per 30-hour work period. The vacation pay vests immediately (that is, an employee is entitled to the pay even if employment terminates). During 2018, total wages paid to employees equaled $415,000, including $5,500 for vacations actually taken in 2018 but not including vacations related to 2018 that will be taken in 2019. All vacations earned before 2018 were taken before January 1, 2018. No accrual entries have been made for the vacations. No overtime premium and no bonuses were paid during the period. Required:Prepare the appropriate adjusting entry for vacations earned but not taken in 2018. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
Answer:
Wage Expense ............ $8,150 Dr
Liability ..................................................... $8,150 Cr
Explanation:
If employees earn 1 hour of vacation per 30 hours of work, then vacation earned in 2018 would be 1/30 of wages, that is
($415,000 - $5,500) x 1/30 = $409,500 x 1/30 = $13,650
Of that amount, $5,500 has been paid so
$13,650 - $5,500 = $8,150
The appropriate adjusting entry for vacations earned but not taken in 2018 is
Wage Expense ............ $8,150 Dr
Liability ..................................................... $8,150 Cr
Hope this helps!
To prepare the appropriate adjusting entry for vacations earned but not taken in 2018, calculate the number of vacation hours earned but not taken based on the information provided. Then, prepare the adjusting entry by debiting the Vacation Expense account and crediting the Vacation Pay Liability account.
Explanation:In order to prepare the appropriate adjusting entry for vacations earned but not taken in 2018, you need to calculate the number of vacation hours earned but not taken in 2018 based on the information provided. The employees earn vacation time at the rate of 1 hour per 30-hour work period. Therefore, you need to divide the total wages paid to employees in 2018 ($415,000) by the hourly wage rate ($415,000 / $2.13) to determine the total number of work hours. Then, divide the total work hours by 30 to find the number of vacation hours earned but not taken. Finally, you can prepare the adjusting entry by debiting the Vacation Expense account and crediting the Vacation Pay Liability account for the amount of vacation pay earned but not taken in 2018.
Blossom Company's accounting records show the following for the year ending on December 31, 2017.
Purchase Discounts $ 11000
Freight-in 15300
Purchases 689020
Beginning Inventory 55000
Ending Inventory 45600
Purchase Returns and Allowances 15100
Using the periodic system, the cost of goods purchased is
Answer: $678,220
Explanation:
Given that,
Purchase Discounts = $ 11,000
Freight-in = $15,300
Purchases = $689,020
Beginning Inventory = $55,000
Ending Inventory = $45,600
Purchase Returns and Allowances = $15,100
Cost of goods purchased:
= Purchases + Freight in - Purchase discounts - Purchase returns and allowances
= $689,020 + $15,300 - $ 11,000 - $15,100
= $678,220
The cost of goods purchased can be calculated by adding the beginning inventory to the purchases and then subtracting the ending inventory.
Explanation:In the periodic system, the cost of goods purchased can be calculated by adding the beginning inventory to the purchases and then subtracting the ending inventory. So, the formula to calculate the cost of goods purchased is:
Cost of Goods Purchased = Beginning Inventory + Purchases - Ending Inventory
Using the given information:
Plug in the values into the formula:
Cost of Goods Purchased = $55,000 + $689,020 - $45,600 = $698,420
Therefore, the cost of goods purchased is $698,420.
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President Bigego is running for re-election against Senator Pander. Bigego proclaims that more people are working now than when he took office. Pander says that the unemployment rate is higher now than when Bigego took office. You conclude that....
a. both of them could be telling the truth if the labor force grew slower than employment.
b. both of them could be telling the truth if the labor force grew faster than employment.
c. one of them must be lying.
d. both of them could be telling the truth if the labor force, and employment grew at the exact same rate.
Answer:
The correct answer is option b.
Explanation:
President Bigego is claiming that more people are working after he too office.
Senator Pandor claims that the unemployment rate has increased after Bigego took office.
Both of them can be right. Unemployment and the number of people working both can increase at the same time. If the labor force increased overtime, the number of people working can increase.
Though if the growth of employment is slower than the growth of the labor force, then unemployment will increase as well. This is because with the increase in labor force number of workers will increase but slower employment growth will create fewer jobs. So, unemployment will increase.
Henry Hacker, a professional golfer who was having trouble with his driver, decided to skip the next two tournaments on the PGA to work with his swing coach. He paid his coach $1,000 and used $1,000 worth of golf balls. As a result, his driving must have improved considerably because he now hits his tee shots longer and straighter. What type of cost are the earnings foregone by skipping the two tournaments on the PGA tour
Final answer:
The earnings that Henry Hacker missed by not participating in the PGA tournaments represent an opportunity cost. Opportunity costs are the benefits one foregoes when choosing one option over another, and although they are not direct expenditures, they are significant in economic decision-making.
Explanation:
The earnings that Henry Hacker forewent by skipping the two tournaments on the PGA tour represent an opportunity cost. Opportunity costs refer to the potential benefits an individual, investor, or business misses out on when choosing one alternative over another. In Henry's case, the opportunity cost is the potential earnings from the tournaments he decided not to participate in. Although not a direct expenditure, opportunity costs are very real and must be considered when assessing the economic impact of a decision. In contrast, the $1,000 paid to his swing coach and the $1,000 used for golf balls are direct costs, as they represent clear financial expenses.
Regarding the golf ball industry, it is characterized by monopolistic competition. This market structure features many companies that sell similar, but slightly differentiated products. Large golf ball manufacturers thus have a strong incentive to market their products as unique to justify higher prices, taking advantage of brand recognition and perceived quality - this can sway professional golfers like Henry. However, for the average amateur golfer, who may not appreciate the subtle differences, most golf balls seem indistinguishable despite marketing efforts to suggest significant differentiation.
You want to endow a scholarship that will pay $ 11 comma 000 per year forever, starting one year from now. If the school's endowment discount rate is 9 %, what amount must you donate to endow the scholarship? How would your answer change if you endow it now, but it makes the first award to a student 10 years from today?
Answer:
You must donate $ 123455.5556 to endow the scholarship.
If the endow it now but it makes the first award to a student 10 years from today, then the amount to donate will be $ 56842.36731.
Explanation:
if the scholarship one year from now, the donation amount would be:
present fund amount = (scholarship amount)/(discount rate)
= $11,000/9%
= $ 123455.5556
Therefore, you must donate $ 123455.5556 to endow the scholarship.
if the scholarship start in 10 years from today, the amount is:
scholarship amount in 10 years = (amount of scholarship today)/[(1+9%)^9]
= $ 123455.5556/(1+9%)^9
= $ 56842.36731
Therefore, if the endow it now but it makes the first award to a student 10 years from today, then the amount to donate will be $ 56842.36731.
Inventory records for Dunbar Incorporated revealed the following:
Date Transaction Number of Units Unit Cost
Apr. 1 Beginning inventory 410 $2.33
Apr. 20 Purchase 380 2.74
Dunbar sold 640 units of inventory during the month. Ending inventory assuming FIFO would be (Do not round your intermediate calculations. Round your answer to the nearest dollar amount):
A. $349.
B. $955.
C. $411.
D. $1,123.
Answer:
Ending inventory assuming FIFO would be $411
Explanation:
Date Q U.cost Cost Sold Inventory Cost
april 1 410 2,33 955,3 410 0 0
apri 20 380 2,74 1041,2 230 150 411
640
g You and your wife are making plans for retirement. You plan on living 25 years after you retire and would like to have $90,000 annually on which to live. Your first withdrawal will be made one year after you retire and you anticipate that your retirement account will earn 15% annually. What amount do you need in your retirement account the day you retire? Round your answer to the nearest cent. Do not round intermediate calculations. $ Assume that your first withdrawal will be made the day you retire. Under this assumption, what amount do you now need in your retirement account the day you retire? Round your answer to the nearest cent. Do not round intermediate calculations.
Answer:
(a) The amount you need in your retirement account the day yo retire is $581,773.42.
(b) If you take the first withdrawal the day you retire, the amount needed is $669,039.44.
Explanation:
This problem is a case of annuity (n = 25 years).
They plan to withdraw $ 90,000 annually from the end of the first year of retirement.
The formula that relates capital in the account to annual withdrawals is
[tex]C=A*D=A*\frac{(1+i)^{n}-1}{i*(1+i)^{n}} \\\\C=90,000*\frac{(1+0.15)^{25}-1}{0.15*(1+0.15)^{25}}=90,000*6.46414908527014\\\\C= 581,773.42[/tex]
If your first withdrawal will be made the day you retire, you can calculate the amount of money in your account as the amount calculated before ($581,773.42) and multiplying it by (1+i)=1.15.
This is because all withdrawals are being advanced in one year, so the current value would be C '= C * (1 + i). Then we have:
[tex]C'=C*(1+i)=581,773.42*(1+0.15)=669,039.44[/tex]
Final answer:
To find out how much is needed for retirement, use the present value of an annuity formula. With a 15% annual return rate and $90,000 annual withdrawals over 25 years, compute the present value for withdrawals one year after retirement. If withdrawing starts on retirement day, simply add one year's withdrawal amount to the calculated present value.
Explanation:
Calculating Retirement Savings
When planning for retirement, one must know the amount required to withdraw annually and the expected rate of return on their retirement account. For an expected annual retirement expense of $90,000 and an anticipated account yield of 15% annually, we can calculate the required retirement savings using the formula for the present value of an annuity:
PV = PMT * [(1 - (1 + r)^{-n}) / r]
Where PV is the present value (the amount needed on the retirement day), PMT is the annual withdrawal amount ($90,000), r is the interest rate (0.15), and n is the number of years (25).
If the first withdrawal happens one year after retirement, the present value is calculated as follows:
PV = $90,000 * [(1 - (1 + 0.15)^{-25}) / 0.15]
This calculation will give us the amount needed in the retirement account the day one retires.
However, if the first withdrawal is made on the day of retirement, we need to adjust the calculation by simply adding one year's worth of withdrawal because it won't have the chance to earn interest. Therefore, the adjusted present value is:
New PV = PV + $90,000
This reflects the new amount required in the retirement account on the day of retirement.
For each account, identify whether the changes would be recorded as a debit (DR) or credit (CR). a. Increase to Accounts Receivable b. Decrease to Unearned Revenue c. Decrease to Cash d. Increase to Interest Expense e. Increase to Salaries Payable f. Decrease to Prepaid Rent g. Increase to Proudfoot, Capital h. Increase to Notes Receivable i. Decrease to Accounts Payable j. Increase to Interest Revenue
Answer:
(a) DR ,(b) DR ,(c) CR ,(d) DR, (e) CR, (f) CR, (g) CR, (h) DR ,(i) DR, (j) CR
Explanation:
(a) DR-This is an increase in current asset.
(b) DR-This is a decrease in deferred income i.e currently a liability.
(c) CR -This is an outflow of cash
(d) DR-
(e) CR-This represents increase in current liabilities.
(f) CR-Prepaid rent is a current asset item. This represents decrease in current assets.
(g) CR-
(h) DR-Notes Receivable is a current asset item. Increase represents increase in current asset.
(i) DR-Account payable is a current liability item.This represents decrease in current liability.
(j) CR-Interest revenue is an income item. This represents increase increase in income
In accounting, increases in Accounts Receivable, Unearned Revenue, Interest Expense, Prepaid Rent, Notes Receivable and Accounts Payable are recorded as debits (DR), while decreases in Cash, Salaries Payable, Proudfoot, Capital, and increases in Interest Revenue are recorded as credits (CR).
Explanation:In the field of accounting, certain rules are followed while recording changes in different accounts. These changes are usually recorded in the form of debits (DR) and credits (CR).
a. An increase to Accounts Receivable would be a Debit (DR).
b. A decrease to Unearned Revenue would be a Debit (DR).
c. A decrease to Cash would be a Credit (CR).
d. An increase to Interest Expense would be a Debit (DR).
e. An increase to Salaries Payable would be a Credit (CR).
f. A decrease to Prepaid Rent would be a Debit (DR).
g. An increase to Proudfoot, Capital would be a Credit (CR).
h. An increase to Notes Receivable would be a Debit (DR).
i. A decrease to Accounts Payable would be a Debit (DR).
j. An increase to Interest Revenue would be a Credit (CR).
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Which of the following is TRUE of a partnership and a corporation? A. In a partnership, income is taxed once at the individual level; whereas, in a corporation, income is taxed twice. B. In a corporation, income is taxed at the corporate level; whereas, in a partnership, income is taxed twice. C. Income from both forms of organizations are doubledashtaxed. D. In a partnership, income is exempted from tax up to $10 million; whereas, in a corporation, income is taxed twice.
Answer: A. In a partnership, income is taxed once at the individual level; whereas, in a corporation, income is taxed twice.
Explanation: Hi, a corporation is considered a legal entity for tax purposes, so it pays taxes based on the corporate tax rate for their income. But also the shareholders pay taxes based on the individual tax rate for the dividends payments received. There is a double taxation .
A partnership is a collection of individuals that come together, the partners are personally liable for the business’s obligations. So, each partner pays taxes based on the individual tax rate for the incomes.
At the beginning of last year, you invested $2,500 in 50 shares of the Chang Corporation. During the year, Chang paid dividends of $7 per share. At the end of the year, you sold the 50 shares for $58 a share. Compute your total HPY on these shares and indicate how much was due to the price change and how much was due to the dividend income. Do not round intermediate calculations. Round your answers to one decimal place.
Answer:
The return on investment will be 30%
Explanation:
holding period return (HPY): the return on investment during the time ity hold the share. It considers the return on dividends and also the gains or loss from the variance in the share price
returns:
dividends: 7
increase in share price: 58 - 50 = 8
Total return: 15
Investment
50
HPY: 15/50 = 0.3 = 30%