Answer:
Explanation:
Statement of cash flow is a statement of how activities of the income statement and statement of financial position impact the cash and cash equivalent of a company through it operating , financing and investing activities
STATEMENT OF CASH FLOW FOR ATM SOFTWARE
The figures appears to be in "000" already
Cash flow from operating activities
Net Income - 10600
Account receivable (3910)
Account payable (1670)
Depreciation expense 5375
Decrease in inventory 1385
Decease in prepaid rent 815
Net cash flow from operating activities 12595
Cash flow from investing activities
Sales of Land 8470
Purchase of equipment (39415)
Net cash flow from financing activities (30945)
Cash flow from financing activities
Issuance of stock - 12,625
long term note payable 16405
Purchase of treasury stock (2525)
Payments of dividends (6910)
Net cash flow from financing activities 19595
Net increase in cash 1605
Cash at the beginning 8330
Cash at the end 9935
The answer involves categorizing the given items into three main components of a statement of cash flows: Operating, Investing, and Financing activities. After assigning appropriate items under each category, their total sum indicates the net change in cash.
Explanation:To prepare the statement of cash flows using the indirect method, organize the given line items under the three main categories: Cash Flows from Operating Activities, Cash Flows from Investing Activities, and Cash Flows from Financing Activities.
Operating Activities:Start with net income: $10,600Add back depreciation expense (non-cash charge): $5,375Subtract increase in accounts receivable (an investment in working capital): -$3,910Add decrease in inventory (a recovery of working capital): $1,385Subtract decrease in prepaid rent (another use of cash): -$815Add decrease in accounts payable (a source of cash as liabilities are decreased): $1,670.Investing Activities:Subtract cash paid for the purchase of equipment: -$39,415Add cash received from the sale of land: $8,470Financing Activities:Add cash from issuance of common stock: $12,625Add cash from issuance of long-term notes payable: $16,045Subtract cash used for payment of dividends: -$6,190Subtract cash used for purchase of treasury stock: -$2,525After calculating each category, sum them up to find the net increase or decrease in cash.
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Jensen will retire on his 65th birthday. He wants to withdraw $150,000 from his reti account on each birthday from his 66th to his 85th to cover his living expense. need in his retirement account on his 65th birthday? Assume interest rate is 10%.
A. 1,297,304
B. 1,254,738
C. 8,291,250
D. 1,277,034
Answer:
The correct answer is option (d).
Explanation:
According to the scenario, the given data are as follows:
Time period ( Nper) = 20 years
Interest rate (rate) = 10%
Payment (pmt) = $150,000
So, we can calculate the Present value by using financial calculator.
The attachment is attached below.
So, Present Value = $1,277,034.56
The amount that needs to be on 65th birthday is 1,277,034.
The June 30, 2021, year-end trial balance for Askew company contained the following information: Account Debit Credit Inventory, 7/1/2020 33,200 Sales revenue 392,000 Sales returns 13,200 Purchases 252,000 Purchase discounts 7,200 Purchase returns 11,200 Freight-in 19,400 In addition, you determine that the June 30, 2021, inventory balance is $41,200. Required: Calculate the cost of goods sold for the Askew Company for the year ending June 30, 2021.
Answer:
Cost of Goods Sold: $245,000
Explanation:
Cost of Goods Sold refers to the direct costs that are incurred when producing the goods sold by a particular company. It includes many costs such as beginning inventory, purchases, purchase returns, discounts on purchases, freight inwards and ending inventory. COGS is also referred to as cost of sales.
Freight inwards are any transportation costs that are incurred when bringing in purchases, hence this is added to purchases. Purchase returns are deducted since they are being returned and hence not a cost. Purchase discounts are also deducted. Ending inventory is the amount of inventory which is remaining and has not been used, thus, this too is deducted.
The calculation for COGS is provided below step-by-step:
1. Beginning inventory : $33200
2. Purchases : $252000
3. Purchase returns : ($11200)
4. Purchase discounts : ($7200)
5. Freight inwards : $19400
6. Ending inventory : ($41200)
Cost of Goods Sold = $245,000
The cost of goods sold for the Askew Company for the year ending June 30, 2021 is $245,000.
Calculation of the cost of goods sold:
Since
Beginning inventory : $33200
Add: Purchases : $252000
Less: Purchase returns : ($11200)
Less: Purchase discounts : ($7200)
Add: Freight inwards : $19400
Less: Ending inventory : ($41200)
Cost of Goods Sold = $245,000
Hence, The cost of goods sold for the Askew Company for the year ending June 30, 2021 is $245,000.
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The production department in a process manufacturing system completed 80,000 units of product and transferred them to finished goods during a recent period. Of these units, 24,000 were in process at the beginning of the period. The other 56,000 units were started and completed during the period. At period end, 16,000 units were in process.Prepare the department’s equivalent units of production with respect to direct materials under each of three separate assumptions using the Weighted -average method for process costing.
Answer:
See explaination
Explanation:
The detailed step by step solution of the given problem is sent across as an attached file.
please kindly check attachment
Nelson Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in cash flow of $107,000. The equipment will have an initial cost of $214,000 and have a 3 year life. If the salvage value of the equipment is estimated to be $82,000, what is the payback period? Ignore income taxes.
Answer:
2 years
Explanation:
The computation of the payback period is shown below:
Payback period = Initial cost of equipment ÷ Annual increase in cash flow
= $214,000 ÷ $107,000
= 2 years
By dividing the initial cost of equipment from the annual increase in cash flow we can get the payback period and the same is shown above i,e in the computation part. and we ignored the salvage value for the same
You are a consultant to a large manufacturing corporation considering a project with the following net after-tax cash flows (in millions of dollars): Years from Now After-Tax CF 0 –30 1–9 15 10 30 The project's beta is 1.9. Assuming rf = 4% and E(rM) = 14% a. What is the net
To calculate the net present value (NPV) of the project with given after-tax cash flows and beta
Explanation:The net after-tax cash flows for the project are as follows:
Year 0: -30 million dollarsYear 1-9: 15 million dollarsYear 10: 30 million dollarsTo calculate the net present value (NPV) of the project, we need to discount these cash flows by the project's required rate of return, which can be calculated using the Capital Asset Pricing Model (CAPM) formula:
r = rf + beta * (E(rM) - rf)
Given rf = 4%, beta = 1.9, and E(rM) = 14%, we can calculate the required rate of return (r) and then apply it to the cash flows to determine the NPV.
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To calculate the net after-tax cash flows for the project, multiply each cash flow by (1 - tax rate).
Explanation:In order to calculate the net after-tax cash flows for the project, we need to consider the cash flows for each year and apply the tax rate. The given cash flows are: Year 0: -30 million, Year 1-9: 15 million, Year 10: 30 million.
To calculate the after-tax cash flows, we multiply each cash flow by (1 - tax rate). Let's assume the tax rate is 20%. The after-tax cash flows will be: Year 0: -30 million, Year 1-9: 15 million * 0.8 = 12 million, Year 10: 30 million * 0.8 = 24 million.
Therefore, the net after-tax cash flows for the project are: Year 0: -30 million, Year 1-9: 12 million, Year 10: 24 million.
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Franklin Manufacturing provided the following information for the month ended Marchâ 31:
Sales Revenue $ 19,000
Beginning Finished Goods Inventory 15,000
Ending Finished Goods Inventory 12,500
Cost of Goods Manufactured 18,600
Required:
a. Compute cost of goods sold.
Answer:
a. Cost of Goods Sold (COGS) amounts to $21,100
Explanation:
a.
Computing the Cost of Goods Available for Sale as:
Cost of Goods Available for Sale = Beginning Finished Goods Inventory + Cost of Goods Manufactured
where
Cost of Goods Manufactured is $18,600
Beginning Finished Goods Inventory is $15,000
So, putting the values above:
Cost of Goods Available for Sale = $18,600 + $15,000
Cost of Goods Available for Sale = $33,600
Computing the COGS (Cost of Goods Sold) as:
Cost of Goods Sold (COGS) = Cost of Goods Available for Sale - Ending Finished goods Inventory
where
Cost of Goods Available for Sale is $33,600
Ending Finished goods Inventory is $12,500
So, putting the values above:
Cost of Goods Sold (COGS) = $33,600 - $12,500
Cost of Goods Sold (COGS) = $21,100
Bond J has a coupon rate of 5 percent and Bond K has a coupon rate of 11 percent. Both bonds have 14 years to maturity, make semiannual payments, and have a YTM of 8 percent. a. If interest rates suddenly rise by 2 percent, what is the percentage price change of these bonds?
Final answer:
The question asks for the percentage price change of bonds with coupon rates of 5% and 11% when interest rates rise by 2%. Bond prices fall when interest rates rise, with bonds having lower coupon rates being more affected. Exact calculations require more information and complex financial formulas.
Explanation:
The question asks about the percentage price change of two bonds with different coupon rates when the interest rates rise by 2 percent. Both bonds have the same years to maturity and yield to maturity (YTM), but because Bond J has a lower coupon rate of 5% and Bond K a higher coupon rate of 11%, their sensitivity to interest rate changes will differ.
When interest rates increase, the price of existing bonds typically falls. This is because new bonds are issued at the new higher rates, making the existing bonds with lower rates less attractive. Since Bond J has a lower coupon rate, it is more sensitive to interest rate changes, and its price will decrease more significantly than Bond K's, which has a higher coupon rate.
To determine the exact percentage price change, you would need to perform a bond price calculation using the new yield to maturity, which would be the original YTM plus the 2% increase. However, this requires additional information and more complex financial formulas which go beyond the scope of this explanation.
Hiring a Black Hat Hacker. You are a member of the Human Resources Department of a software manufacturer that has several products and annual revenue in excess of $500 million. You're on the phone with the manager of software development who has made a request to hire a notorious white hat hacker to probe your company's software products in an attempt to identify any vulnerabilities. The reasoning is that if anyone can find a vulnerability in your software, she can. This will give your firm a head start on developing patches to fix the problems before anyone can exploit them. You feel uneasy about hiring people with criminal records and connections to unsavory members of the hacker/cracker community and are unsure if you should approve the hire. What is the difference between a black hat hacker and a white hat hackera. A white hat hacker is someone who has been hired by an organization to test the security of information systems while a black hat hacker is someone who seeks to violate computer security for his/her own personal illegal gain.
b. A black hat hacker has learned tricks and techniques for violating computer and Internet security measures that are generally not known by a white hat hacker.
c. A white hat hacker is a reformed former black hat hacker.
d. A black hat hacker is a nonemployee who tries to violate computer and Internet security measures of an organization, while a white hat hacker is a malicious employee or contractor of the organization.
A white hat hacker is hired to test security while a black hat hacker seeks to exploit it.
Explanation:The difference between a black hat hacker and a white hat hacker is that a white hat hacker is someone who has been hired by an organization to test the security of information systems, while a black hat hacker is someone who seeks to violate computer security for their own personal illegal gain. A black hat hacker has learned tricks and techniques for violating computer and internet security measures that are generally not known by a white hat hacker. It is important to note that a white hat hacker is not necessarily a reformed former black hat hacker, and a black hat hacker can be a nonemployee who tries to violate computer and internet security measures of an organization, while a white hat hacker can be a malicious employee or contractor of the organization.
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Magic Milling Company has 9% annual coupon bonds that are callable and have 18 years left until maturity. The bonds have a par value of $1,000, and their current market price is $1,100.35. However, Magic Milling may call the bonds in eight years at a call price of $1,060. What are the YTM and the yield to call (YTC) on Magic Milling’s bonds?
Final answer:
The Yield to Maturity (YTM) and Yield to Call (YTC) on Magic Milling's Bonds are approximately 9.66% and 6.08% respectively.
Explanation:
The Yield to Maturity (YTM) and Yield to Call (YTC) on Magic Milling's Bonds
The yield to maturity (YTM) is the total return expected on a bond if it is held until maturity. To calculate the YTM, we need to use the current market price, the coupon rate, and the time left until maturity. In this case, the YTM would be approximately 9.66%.
The yield to call (YTC) is the total return expected on a bond if the bond is called before maturity. To calculate the YTC, we need to use the current market price, the call price, the coupon rate, and the time left until the call date. In this case, the YTC would be approximately 6.08%.
A firm just paid a dividend of $6 per share. Next year the dividend is expected to grow 8 percent, thereafter 10 percent forever. The present share price is $36. Calculate the required rate of return on the firm's equity. Express the response in decimal format
Answer:
26%
Explanation:
MV=Do(1+g)/(Ke-g)
Where MV is market value=$36
Do is current dividend per share=$6
g is growth rate=8%
Ke=?
By putting above values we get;
36=6(1+.08)/(Ke-.08)
36Ke-2.88=6+.48
36Ke=2.88+6+.48
Ke=9.36/36
Ke=26%
g "Your Company sells goods to customers for $1,200 cash. You also collect sales taxes of $96. The journal entry to record this transaction is: Group of answer choices
DR Sales Tax Payable $96; CR Cash $96.
DR Cash of 1,296 ; CR Revenue $1200 ; CR Sales Tax Payable $96
DR Cash $1,296; CR Revenue $1,296.
DR Cash of $1,296 ; CR Revenue $1,200 ; CR Sales Tax Expense $96."
Answer: DR Cash of 1,296 ; CR Revenue $1200 ; CR Sales Tax Payable $96
Explanation:
When accounting for taxes paid on revenue, you must account for them separately.
You add the tax to the sales and DEBIT it to Cash then you take just the sales figure without the tax and CREDIT Revenue. The tax is sent to the Sales Tax Payable Account as a CREDIT.
A kidnapper takes a hostage and demands that the hostage pay ransom. They then play the following game in extensive form. The hostage may pay the ransom or not. Following that, the kidnapper may kill the hostage or release him. If the hostage is released, he may report the kidnapping to the police or not report it. The kidnapper has utility +5 for getting paid, -2 for having the kidnapping reported, and -1 for killing the hostage. These utilities are additive (for instance, getting paid but also reported is worth 5-2 = 3). Utilities for the hostage are -10 for getting killed, -2 for paying, +1 for reporting, and these are also additive.
Draw the game tree for this game, labeling choosers, choices and payoffs. Find the natural outcome of the game. [It should be the second worst outcome for both players.)
Suppose the hostage could make a convincing threat or promise. What should it be? What is the new outcome? Who benefits?
Suppose that after the hostage makes the convincing threat or promise in c), the kidnapper can make a threat or promise. What should it be? What is the new outcome? Who benefits?
If the hostage is not able to make a convincing threat or promise, but the kidnapper can, what should it be and what is the result?
Suggest some real-life ways that any or all of the above threats and promises might be made credible.
Answer:
Explanation:
we would be answering this question by presenting the data in a spreadsheet file (which is a computer program that is used for accounting purposes as well as recording of data using columns and rows which information can be entered in such a useful way for decision making, data analyzing and for record keeping.)
Microsoft Excel would be the spreadsheet application that would be used in answering this question, kindly check the attached image to see the presented solution to the question above.
Which firm is likely to see its profits reduced the most in a recession: an automobile producer, a manufacturer of boots and shoes, or a janitorial service? Which is likely to see its profits reduced the least? Explain.
Automobile producer would see profit reduced the most and janitorial services would be least affected.
Explanation:
Recession is one of the phases of the trade cycle. In this phase of the trade cycle, there is downfall in the production, consumption, investment and saving in the economy. The growth rate of the economy sees a downfall in this phase.
Among the examples given here, automobile producer is the firm which would be one of the most affected company during the time of recession because it is not something essential but luxury.
An automobile producer is most likely to see reduced profits during a recession, while a manufacturer of boots and shoes is the least likely. The janitorial service may experience a moderate impact. Recessions cause cyclical unemployment, whereas industry changes or relocations lead to structural unemployment.
Explanation:The firm likely to see its profits reduced the most in a recession is the automobile producer, since automobiles are expensive, durable goods that consumers often delay purchasing during economic downturns. On the contrary, a manufacturer of boots and shoes is likely to see the least reduction in profits as these items are essential and need to be replaced periodically irrespective of the economic climate. Lastly, a janitorial service may experience a moderate impact since cleanliness is essential for health and safety, yet businesses might reduce the frequency of services to cut costs.
Recessions lead to job losses, creating cyclical unemployment. For example, landscapers laid off due to a drop in new housing construction during a recession is a classic instance of this type of unemployment. Coal miners laid off due to new EPA regulations represent structural unemployment, as the industry changes in response to new legislation. The financial analyst moving to Arizona is an example of frictional unemployment, arising from normal labor turnover and job-seeking activities. Printers and factory workers who lose their jobs due to changing industry conditions or relocation of production are also examples of structural unemployment.
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Which of these is NOT one of the items that can provide useful assistance to a project team to define the activities of a project? a. the major milestones from the Project Charter b. schedules from similar, previous projects c. issue logs d. templates or checklists for projects of the same type
Option C
issue logs is one of the items that can provide useful assistance to a project team to define the activities of a project
Explanation:Activities in a project are the process to recognize and document the exercises that are available to produce the project deliverables. The essential advantage of this method is that it crumbles work units into program activities that present a source for evaluating, cataloging, completing, monitoring, and managing the project work.
The issue log, seldom also identified as an issue register, is a project document where all issues that are negatively altering the project are documented and tracked. This will not be beneficial compensation in defining activities of the project.
The item that does not provide assistance to a project team in defining the activities of a project is the issue logs. While they are important for risk management, they do not directly aid in outlining project tasks or deliverables.
Explanation:When defining the activities of a project, there are certain items that are useful resources specific to project management. These include things like major milestones from the Project Charter, schedules from similar, previous projects, and templates or checklists for projects of the same type. These provide structured, specific frameworks that can guide the project team in planning and executing the project.
However, issue logs do not necessarily provide assistance to a project team when defining activities. While they provide valuable context and shed light on potential problems that may arise during the course of a project, they do not directly serve the purpose of detailing project tasks or deliverables. Instead, they are a tool for risk management.
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AIE Industries plans to purchase a new delivery truck for $250,000. The company has been quoted an annual rate of 6.5 percent with discount interest and a compensating balance of 2 percent.
a. How much will AIE have to borrow?
b. What is the effective rate on this loan?
c. If AIE can convince the bank to remove the compensating balance requirement, what is the effective rate?
Answer:
a. AIE will have to borrow $25,5102.04
b. The Effective Rate on this Loan is 6.63%
c. If AIE can convince the bank to remove the compensating balance requirement the effective rate is 6.50%
Explanation:
In order to calculate how much will AIE have to borrow we would have to use the following formula:
Amount to be borrowed = Cost of Truck / (1 - Compensating balance)
Amount to be borrowed = $250000 / (1 - 0.02)
a. Amount to be borrowed = $25,5102.04
In order to calculate the effective rate on this loan we calculate the following:
Effective Rate on this Loan = Interest / Amount received
Effective Rate on this Loan = 16581.63 / 250000
b. Effective Rate on this Loan = 6.63%
c. If AIE can convince the bank to remove the compensating balance requirement the Effective rate = annual rate, hence the effective rate is 6.50%
AIE will need to borrow approximately $255,102 at an effective interest rate of 6.63%. If the compensating balance requirement is removed, the effective rate will be 6.5%.
Explanation:a. AIE will need to borrow the amount of the truck ($250,000) divided by 1 minus the compensating balance rate (2%). So, the company will have to borrow $250,000 / (1 - 0.02) = $255,102.
b. The effective interest rate is the discount interest divided by (1 - compensating balance), which is 6.5% / (1 - 0.02). The effective rate is thus approximately 6.63%.
c. If the compensating balance requirement is removed, the effective rate will be the same as the quoted rate, which is 6.5%%.
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Suppose a typical automobile tire cost $50 in the base year and had a useful life of 40,000miles. Ten years later, the typical automobile tire cost $75 and had a useful life of 75,000 miles. If no adjustment is made for mileage, the CPI would *
Answer:
Overestimate inflation between the two years.
Explanation:
If there is an increase in the cost of automobile tire and no adjustment is made in the mileage, and then CPI would be overestimated between the two years. This is because as there is no improvement in mileage and hence it is estimated that there is no increase in variable costs in the process of improving the quality.
Therefore, the correct answer is overestimate inflation between the two years.
The Guitar Shoppe reports the following sales forecast: August, $110,000; September, $190,000. Total sales includes 30% cash sales, 55% credit sales collected in the month following sale, and 15% credit sales written off as uncollectible. Prepare a schedule of cash receipts for September.
Final answer:
To prepare a schedule of cash receipts for September, calculate the cash received from cash sales, credit sales collected in September, and credit sales written off. Cash receipts: $57,000 (cash sales) + $104,500 (credit sales collected) + $28,500 (written off) = $190,000 (total cash receipts).
Explanation:
To prepare a schedule of cash receipts for September, we need to calculate the cash received from different types of sales. According to the sales forecast, the total sales for September are $190,000. Based on the given information, 30% of the sales are cash sales. Therefore, the cash receipts from cash sales would be 30% of $190,000, which is $57,000.
For the credit sales, we know that 55% of them are collected in the month following the sale. So, the cash receipts from credit sales collected in September would be 55% of $190,000, which is $104,500.
Finally, 15% of the credit sales are written off as uncollectible. Therefore, the cash receipts from credit sales written off would be 15% of $190,000, which is $28,500.
Adding up all the cash receipts, the schedule of cash receipts for September would look like:
Cash sales: $57,000
Credit sales collected in September: $104,500
Credit sales written off: $28,500
Total cash receipts: $190,000
Pisa Pizza, a seller of frozen pizza, is considering introducting a healthier version of its pizza that will be low in cholesterol and contain no trans fats. The firm expects that sales of new pizza will be $20 million per year. While many of these sales will be to new customers, Pisa Pizza estimaes that 40% will come from customers who switch to the new, healthier pizzai nstead of buying the original version.
a) Assume cusotmer will spend the same amount on either version. What level of incremental sales is associated with introducing the new pizza?
b) Suppose that 50% of hte cusomters who will switch from Pisa Pizza's orignial pizza to its healthier pizza will switch to another brand if Pisa PIzza does not introduce a healthier pizza. What level of incremental sales is associated with introducing the new pizza in this case?
Answer:
Part 1:
Level of incremental sales is associated with introducing the new pizza= $12 million
Part 2:
Level of incremental sales is associated with introducing the new pizza=$16 million.
Explanation:
Given Data:
Expected sales of new pizza=$20 million per year
Percentage of Loss on buying the original version=40%=0.40
Amount of Loss on buying the original version=0.40*$20 million
Amount of Loss on buying the original version=$8 million.
Required:
What level of incremental sales is associated with introducing the new pizza?What level of incremental sales is associated with introducing the new pizza in this case when 50% of the customers who to its healthier pizza will switch to another brand ?Solution::
Part 1:
Level of incremental sales is associated with introducing the new pizza= Expected sales of new pizza-lost sales of original
Level of incremental sales is associated with introducing the new pizza=$20 million-$8 million
Level of incremental sales is associated with introducing the new pizza= $12 million
Part 2:
Level of incremental sales is associated with introducing the new pizza=Expected sales of new pizza - lost sales from customers who do not Switched
Level of incremental sales is associated with introducing the new pizza=$20 million-0.5*$8 million
Level of incremental sales is associated with introducing the new pizza=$16 million.
Suppose the CPI was 140 last year and is 168 this year. a. What is this year’s rate of inflation? Instructions: Enter your response as a percentage rounded to one decimal place. Use a minus sign if necessary. b. In contrast, suppose that the CPI was 140 last year and is 134 this year. What is this year’s rate of inflation? c. What term do economists use to describe this second outcome?
Answer:
a) Inflation = = 20%
b) Inflation = -4.3
c) Deflation
Explanation:
The rate of change in the consumer price index is used to measure the movement in price level . An increase in the price level is termed inflation and a decrease is termed deflation.
a)
Inflation =( Current CPA/previous CPI) -1 × 100
= (168/140) - 1 × 100
= 20%
b)
Inflation = (134-140)/140 × 1 = -4.3%
c) The second outcome is called deflation
The answer provides calculations for the rates of inflation in two scenarios and explains the term economists use for the second outcome.
a. What is this year’s rate of inflation?
Calculation: Rate of Inflation = ((CPI This Year - CPI Last Year) / CPI Last Year) x 100Rate of Inflation = ((168 - 140) / 140) x 100 = 20%b. What is this year’s rate of inflation?
Calculation: Rate of Inflation = ((CPI This Year - CPI Last Year) / CPI Last Year) x 100Rate of Inflation = ((134 - 140) / 140) x 100 = -4.3%c. What term do economists use to describe this second outcome?
DeflationChamonix Chateau Rentals. You are planning a ski vacation to Mt. Blanc in Chamonix, France, one year from now. You are negotiating the rental of a chateau. The chateau's owner wishes to preserve his real income against both inflation and exchange rate changes, and so the present weekly rent of 9,800 (Christmas season) will be adjusted upward or downward for any change in the French cost of living between now and then. You are basing your budgeting on purchasing power parity (PPP). French inflation is expected to average 3.5% for the coming year, while US. dollar inflation is expected to be-2596.The current spot rate is $1.3620 What should you budget as the U.S. dollar cost of the 1-week rental?
a. Spot exchange rate (S/) $1.3620
b. Expected US inflation for coming year | 2.500%
c. Expected French inflation for coming year | 3.500%
d. Current chateau nominal weekly rent (E) 9,800.00
Answer:
The budgeted $ amount is $13,680.88
Explanation:
The purchasing power parity formula gives us an idea what an exchange spot rate would be in future period using the below formula:
Future spot rate=current spot rate*(1+US inflation)/(1+French inflation)
current spot rate=$1.3620
US inflation rate is 2.50%
French inflation is 3.50%
Future spot rate=$1.3620*(1+2.5%)/(1+3.5%)
future spot rate=$1.3488
The weekly cost of vacation would also be adjusted for inflation rate in France as follows:
Adjusted price=9800*(1+3.5%)=10143
Hence the cost of the one week rental would be 10143 multiplied by the future spot exchange rate of 1.3488 i.e $ 13,680.88 (10143*1.3488)
On November 1, Wright Co. borrowed $20,000 cash from Third Bank by signing a 90-day, 6% interest-bearing note.
On December 31, Wright recorded an adjusting entry to interest expense of $200.
On January 30, the due date of the note, Wright will record the payment with a debit to Interest Expense in the amount of $ _______.
On January 30, the due date of the note, Wright will record the payment with a debit to Interest Expense in the amount of $100.
Explanation:
On November 1, Wright Co. borrowed $20,000 cash from the Third Bank by signing a 90-day, and 6% of interest-bearing note.On December 31, it was recorded an adjusting entry to interest expense of $200.On January 30, which is the due date of the note, Wright will record the payment with a debit to Interest Expense in the amount of $100.Interest expense is an expense which is known as a non-operating expense which is shown on the income statement. It also represents interest payable amount when it is borrowed. For Example, bonds,convertible debt, loans or lines of creditThe main difference between the interest expense and the interest paid is that the discount amount and this difference changes the net amount of bond liability. Interest expense is an amount determined by the interest rate on an account.High Middle Ages agriculture included all of these features EXCEPT Select one: a. increased output by increasing the amount of land used for farming. b. use of slave labor. c. extensive swamp draining and land clearance. d. application of the three-field system. be. improved methods through the use of iron tools.
Answer:
B) use of slave labor.
Explanation:
During the high middle ages most slaves in Europe were due to religious wars. E.g. if Christian crusaders won territory they would take Muslim slaves and when Muslims won territory they would also take Christian slaves.
During the early middle ages slaves were used for agricultural activities but that almost ceased in the high middle ages. The Catholic church promoted the change from being a slave into being a feudal serf. By the late 10th century (end of early middle ages) most slaves were turned into serfs. Even though the life of a serf was very complicated and difficult, it was better than being a slave.
But that didn't apply to religious prisoners until the end of the high middle ages when the Pope prohibited Muslim slaves (but that didn't stop it from happening).
You are considering investing $1,000 in a complete portfolio. The complete portfolio is composed of treasury bills that pay 5% and a risky portfolio, P, constructed with 2 risky securities X and Y. The optimal weights of X and Y in P are 60% and 40% respectively. X has an expected rate of return of 14% and Y has an expected rate of return of 12%. To form a complete portfolio with an expected rate of return of 11%, you should invest __________ of your complete portfolio in treasury bills. 19% 26.8% 36% 50%
Answer:
You should invest 26.8% of your complete portfolio in treasury bills to earn an expected rate of return of 11% on a complete portfolio.
Explanation:
To begin with, first we have to calculate the return of P portfolio consisting of X and Y securities.
Expected Return (ER) = (Weight of X*Return of X) + ( Weight of Y*Return of Y)
ER = (0.6*0.14) + (0.4*0.12)
ER = 0.084 + 0.048
ER = 0.132 or 13.2%
Now, we have to compute the weight of treasury bills in complete portfolio:
ER = (Weight of TB*Return of TB) + (Weight of P*Return of P)
ER = (wTB * rTB) + (wP * rP)
ER= (wTB * rTB) + rP * (1-wTB)
0.11 = (wTB * 0.05) + 0.132*(1-wTB)
0.11= 0.05wTB + 0.132 - 0.132wTB
0.11 = -0.082wTB + 0.132
Let's make the Weight of Treasury Bills subject:
0.082wTB = 0.132 - 0.11
0.082wTB = 0.022
wTB = 0.022/0.082
Weight of Treasury Bills = 0.268 or 26.8%
In 2009, 1 U.S. dollar purchased 1600 Korean won and in 2013 it purchased 800 Korean won. How much did 1000 Korean won cost in U.S. dollars in 2009 and 2013? Group of answer choices 2009: .84 dollars, 2013: 1.09 dollars 2009: .62 dollars, 2013: 1.25 dollar 2009: .83 dollars, 2013: 1.12 dollars 2009: .71 dollars, 2013: 1.11 dollars PreviousNext
Answer: 2009: .62 dollars, 2013: 1.25 dollar
Explanation:
In 2009, the US Dollar Exchanged against the Korean Won was something like,
= $1 : 1,600 Won
That means that to get how much USD that 1,000 Won can buy we,
= 1,000/1,600
= $0.62
In 2013, the US Dollar Exchanged against the Korean Won was something like,
= $1 : 800 Won
This shows that the Won became stronger so we can expect to buy more dollars,
Calculating the amount of USD that 1,000 Won can buy we do the following,
= 1,000/800
= $1.25
So the correct option is $0.62 in 2009 and $1.25 in 2013.
Prepare the journal entries to record the following transactions for Blossom Company, which has a calendar year end and uses the straight-line method of depreciation. On September 30, 2022, the company sold old equipment for $124,200. The equipment was purchased on January 1, 2020, for $259,200 and was estimated to have a $43,200 salvage value at the end of its 5-year life. Depreciation on the equipment has been recorded through December 31, 2021.
Answer:
Dr. Cash $124,200
Dr. Accumulated Depreciation $118,800
Dr. Loss on Disposal $16,200
Cr. Equipment $259,200
Explanation:
Depreciation is the recording of asset expense due to its use. It is due to use of fair value of the asset after use. The expense value reduces the asset value over useful life period.
As per given data
Cost of Asset = $259,200
Useful life= 5 years
Salvage Value = $43,200
Asset is purchased on January 1, 2020 and on September 30, 2022 depreciation of only 2 years and 9 months has charged.
Depreciation per year = (Cost of Asset - Salvage Value) / Useful life = ($259,200 - $43,200) / 5 = $43,200
Accumulated Depreciation as on September 30, 2022 = ($43,200 x 2) + $43,200 x 9/12 = $118,800
Book value of the asset is the net of accumulated depreciation of the asset. The accumulated depreciation on September 30, 2022, is as follow:
Net Book value of Asset = 259,200 - $118,800 = $140,400
Assume that the won is the subsidiary’s functional currency. What balances does a consolidated balance sheet report as of December 31, 2017? a. Marketable equity securities = $16,000 and Inventory = $16,000. b. Marketable equity securities = $17,000 and Inventory = $17,000. c. Marketable equity securities = $19,000 and Inventory = $16,000. d. Marketable equity securities = $19,000 and Inventory = $19,000.
Complete Question :
A Clarke Corporation subsidiary buys marketable equity securities and inventory on April 1, 2017, for 100,000 won each. It pays for both items on June 1, 2017, and they are still on hand at year-end. Inventory is carried at cost under the lower-of-cost-or-net realizable rule. Currency exchange rates for 1 won follow:
January 1, 2017 $0.15 = 1 won
April 1, 2017 0.16 = 1
June 1, 2017 0.17 = 1
December 31, 2015 0.19 = 1
Assume that the won is the subsidiary’s functional currency. What balances does a consolidated balance sheet report as of December 31, 2017?
a. Marketable equity securities = $16,000 and Inventory = $16,000.
b. Marketable equity securities = $17,000 and Inventory = $17,000.
c. Marketable equity securities = $19,000 and Inventory = $16,000.
d. Marketable equity securities = $19,000 and Inventory = $19,000.
Answer:
Step 1 of 4
A business combination is the union of the small business units into one. The new combined unit is known as business combination. This is done for various purposes. A business combination generally increases the efficiency and productivity while reducing the costs.
Consolidated financial statements are those statements in which the financial statements of both the parent and all its subsidiaries are shown as a single entity.
Translated adjustments are those adjustments which are made in the income statement to incorporate the fluctuations in the exchange rates.
Step 2 of 4
The exchange rate is the exchange of the currencies of the two countries. There is a certain fee while changing the currency between two countries.
Translated adjustments are made because of the fluctuations in the different currencies. This generally affects all the aspects in the income statement and the balance sheet like assets, liabilities and equity. If the adjustment is positive then it means that the company is gaining from the currency fluctuations and vice versa.
Step 3 of 4
Since the functional currency is the foreign currency, hence the translation will be done at the current rate method. Hence, all the assets will be translated at the current rate. The current rate in this case is $0.19.
Step 4 of 4
[Find the attachments]
Which most accurately characterizes the method used to calculate inflation? Bureaucrats evaluate changes in the price of a nation's currency in terms of other prominent world currencies. Economists measure change in the prices of three goods (gasoline, gold, and wheat) thought to be important determinants of the health of the economy. Analysts measure the cost of a bundle of goods representative of overall spending at two points in time and compare the difference in cost. Government workers poll households to find out how much change there is in the prices that they are paying. Researchers observe the interest rate at two points in time and infer the rate of inflation from the difference.
Answer:
Analysts measure the cost of a bundle of goods representative of overall spending at two points in time and compare the difference in cost.
Explanation:
Inflation refers to a situation in which there is a rise in the price level of the goods in an economy at a particular point of time.
For determining inflation, we need to compare the cost of buying certain baskets of goods in the current year and the cost of buying same basket of goods in the previous year. So that we are able to find the exact rise in the price level of the goods.
We need to analyse the cost of the same basket of goods for the two different periods. Hence, we will get the most appropriate values of the inflation.
Final answer:
Inflation is typically measured using the Consumer Price Index (CPI), which compares the cost of a representative bundle of goods and services at different points in time. The CPI is considered the standard measure of inflation, although it is important to acknowledge some of its limitations and biases.
Explanation:
Measuring Inflation
The method that most accurately characterizes the calculation of inflation is where analysts measure the cost of a bundle of goods representative of overall spending at two points in time and compare the difference in cost. This approach is embodied in the calculation of the Consumer Price Index (CPI), which is the most commonly cited measure of inflation. The CPI is crafted by statisticians at the U.S. Bureau of Labor Statistics and uses a basket of goods and services that reflects the purchases of an average family. Despite the prominence of the CPI, it's important to consider the distinction between the cost of living and the CPI, as well as addressing biases such as the substitution bias and the quality/new goods bias. Additionally, other measures like the GDP deflator and the Core Inflation Index provide alternative views on price changes in the economy.
Which of the following is the correct formula for measuring an efficiency variance? A. Efficiency Variance = (Actual Quantity times Standard Quantity) / Standard Cost B. Efficiency Variance = (Actual Quantity / Standard Quantity) times Standard Cost C. Efficiency Variance = (Actual Quantity minus Standard Quantity) times Standard Cost D. Efficiency Variance = (Actual Quantity + Standard Quantity) minus Standard Cost
The correct formula for measuring an efficiency variance is (Actual Quantity - Standard Quantity) * Standard Cost. It compares the actual quantity of inputs used with the standard quantity and multiplies the difference by the standard cost.
Explanation:The correct formula for measuring an efficiency variance is:
Efficiency Variance = (Actual Quantity - Standard Quantity) * Standard Cost
The efficiency variance compares the actual quantity of inputs used with the standard quantity of inputs that should have been used, and then multiplies the difference by the standard cost of the inputs.
For example, if the actual quantity of materials used is higher than the standard quantity, the efficiency variance would be negative, indicating that more materials were used than expected.
Learn more about Efficiency variance here:https://brainly.com/question/31605817
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Wall Drugs offered an incentive stock option plan to its employees. On January 1, 2016, options were granted for 60,000 $1 par common shares. The exercise price equals the $5 market price of the common stock on the grant date. The options cannot be exercised before January 1, 2019, and expire December 31, 2020. Each option has a fair value of $1 based on an option pricing model. What is the entry to record the expiration of 10% of the options on December 31, 2020?
Answer:
See the explanation below.
Explanation:
Fair value of expired option = 60,000 * $1 * 10% = $6,000
Journal entries will be as follows:
Details Dr ($) Cr ($)
Paid-in capital - stock options 6,000
Paid-in capital - expiration to stock options 6,000
To record the expiration of stock option
Suppose India has a per capita GDP that is .074 times the United States GDP. It has a capital-per-person ratio that is .035 times that of the United States. Compared to the United States, the implied value of total factor productivity for India is approximately a. .30. b. .07. c. .12.d. .23.
Final answer:
To find the implied value of total factor productivity for India, we can use the formula: Total factor productivity = Per capita GDP / Capital per person ratio. Given the values provided, the implied value of total factor productivity for India is approximately 2.114.
Explanation:
To find the implied value of total factor productivity for India, we can use the formula:
Total factor productivity = Per capita GDP / Capital per person ratio
Given that India's per capita GDP is 0.074 times the United States GDP and its capital-per-person ratio is 0.035 times that of the United States, we can substitute these values into the formula:
Total factor productivity = 0.074 / 0.035 = 2.114
Therefore, the implied value of total factor productivity for India is approximately 2.114.
The correct answer option is D. Compared to the United States, the implied value of total factor productivity for India is approximately 23.
To find the implied value of total factor productivity (TFP) for India compared to the United States, we can use the Solow-Swan growth model, which relates output (GDP) to capital and labor inputs. The equation for GDP in this model is Y = A * (K^α) * (L^(1-α)), where Y is GDP, A is TFP, K is capital, L is labor, and α is the output elasticity of capital.
Given that India's per capita GDP is 0.074 times that of the United States and its capital-per-person ratio is 0.035 times that of the United States, we can set up the ratio:
India's GDP per capita / US GDP per capita = (India's TFP * India's capital per person ^ α * 1) / (US TFP * US capital per person ^ α * 1)
Substituting the given values and solving for A (TFP) yields approximately 0.23. So, the correct answer is d. .23.