Answer:
YTM is 7.43%
Explanation:
The yield to maturity of a bond can be computed using the rate formula in excel,which is given below:
=rate(nper,pmt,-pv,fv)
the nper is the number of coupon interest the bond would pay before it is redeemed at maturity starting from ,which is 15 years multiplied by 2=30
the pmt is the semiannual coupon payable by the bond,which is $1000*9.1%/2=$45.5
the pv is the price of the bond which is 115%*$1000=$1150
the fv is the face value of the bond at $1000
=rate(30,45.5,-1150,1000)=3.715%
The rate of 3.715% is a semi annual rate
annual rate 7.43%(3.715%*2)
How would a catering sales manager handle a mother and daughter making arrangements for the daughter’s wedding differently from a meeting planner from a major corporation wishing to get a quote on a regional sales meeting, which he or she has already done in five other cities?
Answer: By being more Affable
Explanation:
A wedding is a very personal experience that a lot of people look forward to and don't want to be disappointed. In this light, the Catering Sales Manager would probably be very personal with them. Very good natured and affable to ensure that the experience is a good one for the bride to be.
They'll likely pay more attention to detail and make suggestions that they think would work best to ensure a great day. As earlier mentioned, weddings are deeply personal. And so they require a personal touch.
The Sales Manager however will not be as personal with the meeting planner. Not necessarily out of disrespect but because the person already knows what they are looking for and so they will probably engage in a formal tone. There is also the fact that such people might be remarkably busy and would not like to waste time in personal conversation.
Pets Inc. makes 2 products, dog collars and cat collars. Each passes through the cutting machine, which is the binding constraint. Dog collars take 6 minutes on the cutting machine and have a contribution margin per unit of $10. Cat collars take 4 minutes on the cutting machine and have a contribution margin per unit of $8.Assume that there are 2,000 hours available on the cutting machine and that the demand for each product is 15,000 units. How many of each product should be made
Answer:
Dog Collar 10,000 units
Cat Collar 15,000 units
Explanation:
We have only constraint of 2,000 hours on the cutting machine.
First we will calculate the Contribution margin per hour
Contribution margin per hour = Contribution margin per unit / Numbers of hours required per unit
Dog Collar = $10 / (6/60)hours = 10 / 0.1 = $100 per hour
Cat Collar = $8 / (4/60) hours = $120 per hour
Pets Inc. will make Cat collar more than dog
Hours required for 15,000 unit of Cat Collar = 15000 x 4 / 60 = 1,000 hours
Hours for Dog Collars = 2,000 - 1000 = 1000 hour
Unit of Dog Collar = 1000 hours / (6/60) = 10,000 units
Gladstone Corporation is about to launch a new product. Depending on the success of the new product, Gladstone may have one of four values next year: $150 million, $135 million, $95 million, or $80 million. These outcomes are all equally likely, and this risk is diversifiable. Gladstone will not make any payouts to investors during the year. Suppose the risk-free interest rate is 5% and assume perfect capital markets.
a) What is the initial value of Gladstone’s equity without leverage? Now suppose Gladstone has zero-coupon debt with a $100 million face value due next year.
b) What is the initial value of Gladstone’s debt?
c) What is the yield-to-maturity of the debt? What is its expected return?
d) What is the initial value of Gladstone’s equity? What is Gladstone’s total value with leverage? Suppose Gladstone has 10 million shares outstanding and no debt at the start of the year.
e) If Gladstone does not issue debt, what is its share price?
f) If Gladstone issues debt of $100 million due next year and uses the proceeds to repurchase shares, what will its share price be? Why does your answer differ from that in part e)?
Answer: SEE EXPLANATION
Explanation:
Given the following ;
Values depending on Success
$150M, $135M, $95M, $80M
Risk free rate = 5% = 0.05
Pervebtage to be lost in case of bankruptcy = 25% = 0.25
A.) 0.25 × [( 150 + 135 + 95 + 80) ÷ 1.05] = $109.52 million
Assume a zero-coupon debt with a $100million face value
B.) 0.25 × [( 100 + 100 + (95×0.75) + (80×0.75)) ÷ 1.05] = $78.87 million
C.) Yield to maturity (YTM)
(100M÷78.87M) - 1
1.2679 - 1 = 0.2679 = 26.79%
Expected return = 5%
D.) Equity value
0.25 × [( 150 + 135 + (95×0.75) + (80×0.75)) ÷ 1.05] = $99.11 million
E.) share if no debt is issued
109.52 ÷ 10 = 10.95 per share
F.) Share price if debt of $100M is issued
99.11 ÷ 10 = 9.91 per share
The price differs because bankruptcy cost will Lower the share price.
Final answer:
The initial value of Gladstone Corporation's equity without leverage is $109.52 million, and the initial value of its debt with leverage is $95.24 million. With leverage, the initial equity value is $14.28 million, and the total value of the firm with leverage remains unchanged. Share price differs when debt is issued and used to repurchase shares due to the changed equity structure.
Explanation:
Calculating the Value of Gladstone Corporation's Equity and Debt
To calculate the initial value of Gladstone’s equity without leverage, we need to consider the expected value of the corporation next year, which is the average of the four possible values. Since all outcomes are equally likely, we find the average: (150 + 135 + 95 + 80) million / 4 = $115 million. To find the present value, we discount this at the risk-free rate of 5%, giving us an initial equity value of $115 million / (1 + 0.05) = $109.52 million.
With zero-coupon debt of $100 million face value due next year, the value of the debt is the present value of the face value, discounted at the risk-free rate. Hence, the initial value of the debt is $100 million / (1 + 0.05) = $95.24 million. The yield-to-maturity (YTM) of the debt would be the rate at which this present value grows to $100 million in one year, which is 5%. However, because the risk is diversifiable and there is a possibility that the firm value falls below the debt value (in two out of four scenarios), the expected return will also factor in the probability of default, which would be different from the YTM.
The initial value of Gladstone’s equity with the leverage is the total firm value minus the value of debt, so it’s $109.52 million - $95.24 million = $14.28 million. The total value with leverage remains the same because leveraging doesn't change the total value of the firm, just how it is divided between debt and equity. With 10 million shares outstanding, the share price without issuing debt is $109.52 million / 10 million = $10.95 per share.
If debt is issued and proceeds are used to repurchase shares, the shares' price will adjust to reflect the new equity value, which is now $14.28 million. If all $100 million is used to buy back shares, the number of shares will decrease. The new share price will be higher than before because there are fewer shares that now represent the equity value of $14.28 million. The price differs from part e) because of the change in equity structure due to the debt issue and share repurchase.
Whatever, Inc., has a bond outstanding with a coupon rate of 5.73 percent and semiannual payments. The yield to maturity is 6.7 percent and the bond matures in 23 years. What is the market price if the bond has a par value of $1,000?
a)889.56
b)904.76
c)887.02
d)887.80
e)888.39
Answer:
The market price if the bond has a par value of $1,000 is $887.02 . The right answer is c.
Explanation:
In order to calculate the market price if the bond has a par value of $1,000, we need first to make the following calculations according to given data:
Coupon Rate = 5.73/2 = 2.865%
Interest = 1000 * 2.865% = $ 28.65
YTM = 6.7/2 = 3.35%
Time = 23*2 = 46 periods
Therefore, the market price would be calculated using the following formula:
Price of Bond = Interest * PVIFA(3.35%,46) + Par Value * PVIF(3.35%,46)
= $28.65 * 23.2942 + 1000 * 0.2196
= $667.38 + $219.64
Hence, Price of Bond = $887.02
The market price if the bond has a par value of $1,000 is $887.02
A manufacturer contemplates a change in technology that would reduce fixed costs from $800,000 to $600,000, and reduce depreciation expense from $125,000 to $100,000. However, the ratio of variable costs to sales would increase from 68% to 80%. What would be the change in the break-even level of revenues?
Answer:
break-even level of revenues increases from $2,890,625 to $3,500,000
Explanation:
Break even point is the level of sales at which the company makes neither a Profit nor a loss.
Break -even Sales revenue = Fixed Cost / Contribution Margin Ratio
Old Break -even Sales revenue
Break -even Sales revenue = ( $800,000 + $125,000)/(1.00-0.68)
= $925,000/ 0.32
= $2,890,625
Old Break -even Sales revenue
Break -even Sales revenue = ( $600,000 + $100,000)/(1.00-0.80)
= $700,000/ 0.20
= $3,500,000
Sandhill Inc. has the following information related to an item in its ending inventory. Packit (Product # 874) has a cost of $76, a replacement cost of $60, a net realizable value of $68, and a normal profit margin of $4. What is the final lower-of-cost-or-market inventory value for Packit? $60. $68. $64. $76.
Answer:
$64
Explanation:
The computation of final lower-of-cost-or-market inventory value is given below:-
Ceiling LCM = Estimated selling price - Cost to disposal or NRV ($68)
Floor LCM = NRV - Normal profit
= $68 - $4
= $64
Conditions: 1)When the cost of replacement is greater than the LCM ceiling then the LCM ceiling is considered the market cost.
2)If the cost of replacement is greater than floor LCM then floor LCM is considered to be the market cost
So, second condition is satisfied.
The market value is $64, cost is $76.
Lower of cost or market rate is $64
Hancock Medical Supply Co., which had no beginning balance in its Accounts Receivable and Allowance for Doubtful Accounts, earned $88,500 of revenue on account during 2016. During 2016, Hancock collected $70,000 of cash from its receivables accounts. The company estimates that it will be unable to collect 1% of revenue on account. The amount of net realizable value of receivables on the December 31, 2016 balance sheet would be:
Answer:
$17,615
Explanation:
Hancock Medical Supply Co net realizable value of receivables on the December 31, 2016 balance sheet
Beginning accounts receivable $0
Add revenue on account $88,500
Less collected cash $70,000
Ending account receivable $18,500
Beginning allowance balance $0
Add uncollectible account expenses
($88,500×1%) $885
Ending Allowance balance $885
Net Realizable value of Receivables =
$18,500-$885
=$17,615
Therefore Hancock Medical Supply Co net realizable value of receivables on the December 31, 2016 balance sheet will be $17,615
8. An oil price shock (hard): Suppose the economy is hit by an unexpected oil price shock that permanently raises oil prices by $50 per barrel. This is a temporary increase in o in the model: the shock o becomes positive for one period and then goes back to zero. (a) Using the full short-run model, explain what happens to the economy in the absence of any monetary policy action. Be sure to include graphs showing how output and inflation respond over time. (b) Suppose you are in charge of the central bank. What monetary policy action would you take and why
Answer:
An oil cost shock is an exogenous shock and it will in general move the short run total stockpile bend SRAS upwards showing an expanded expense of creation.
a. From introductory balance, value level in the economy for all time rises and this moves the economy to another balance to bring down short-run yield level.
Phillips bend, indicating the impact of swelling, climbs in period one and afterwards moves back. Fisher's condition portrays the reverse connection between genuine loan fee and expansion through ostensible financing cost. On the off chance that the national bank is failing to help controlling swelling, at that point this suggests it needs to keep up the first ostensible financing cost.
This decreases the genuine loan fee when ostensible financing cost is kept unaltered. With LM moving downwards, it animates the economy to an expanding lower level of genuine loan cost as expansion rises for all time.
b. Since an oil value stun upsets the economy through swelling channel, national bank ought to fix the financial arrangement to decrease it for one period. In spite of the fact that this damages the economy all the more however this will last just for one period. As the genuine financing cost ascend in the following time frame, swelling falls and balance in the economy is reestablished.
Joint ventures are often the chosen form of multinational firm alliances because they ________. Grupo de opciones de respuesta provide greater control of proprietary technology enhance the specific skills of the personnel enhance the rewards of the firm increase the level of competition between partner firms
Answer:
provide greater control of proprietary technology
Explanation:
A joint venture is a business made by two or more parties and has a shared ownership along with the risks. Companies make JV as to access new markets and particulate the emerging markets, gain scale differences in operations, share risks for major projects, to access skills and capabilities. Most of them are incorporated as the oil and gas industry. Combining temporary partnership and some examples include the Dow corning, Sony Ericsson. They can contract its own name, acquire rights as the right to buy new companies.Naples Company produced 650,000 units and sold 500,000 units. Their unit selling price is $10. Cost of goods sold is $6 per unit. Fixed selling expenses are $10,000 and variable selling and administrative expenses are $3 per unit. Compute Naple's net income under absorption costing. $4,990,000 $500,000 $1,990,000 $490,000
Answer:
$490,000
Explanation:
The computation of the net income under absorption costing is shown below:
Sales (500,000 units × $10) $5,000,000
Less: Cost of goods sold (500,000 units × $6) -$3,000,000
Gross profit $2,000,000
Less: variable selling and administrative expenses
(500,000 units × $3) -$1,500,000
Less: Fixed selling expenses -$10,000
Net income $490,000
Under absorption costing we considered the fixed and selling expenses
Revenue expenditures
a. Are additional costs of plant assets that do not materially increase the asset's life or its productive capabilities.
b. Are known as balance sheet expenditures because they relate to plant assets.
c. Extend the asset's useful life. Substantially benefit future periods.
d. Are debited to asset accounts when incurred.
Answer:
Answer A
Explanation:
Revenue expenditures are the expenditures during period in which the asset has been put into its usage. They are often discussed in the context of fixed assets. For instance if a company installs new equipment and has monthly costs of its maintenance, these costs are revenue expenditures. Therefore, they only present additional costs that do not necessarily increase asset's life.
Khaling Company sold 26,900 units last year at $16.50 each. Variable cost was $11.60, and total fixed cost was $136,710. Required: 1. Prepare an income statement for Khaling for last year. 2. Calculate the break-even point in units. 3. Calculate the units that Khaling must sell to earn operating income of $15,680 this year.
Answer:
Instructions are below.
Explanation:
Giving the following information:
Khaling Company sold 26,900 units last year at $16.50 each. The variable cost was $11.60, and the total fixed cost was $136,710.
1) Income statement:
Sales= 26,900*16.5= 443,850
Variable costs= 26,900*11.6= (312,040)
Contribution margin= 131,810
Fixed costs= (136,710)
Net operating income= (4,900)
2) To calculate the break-even point in units, we need to use the following formula:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 136,710 / (16.5 - 11.6)
Break-even point in units= 27,900units
3) Now, we need to include the desired profit to the break-even point formula:
Break-even point in units= (136,710 + 15,680) / 4.9
Break-even point in units= 31,100 units
Lockeran Co. has the following projected sales, costs, net investment and free cash flows in millions. The anticipated growth rate in free cash flows after year 6 is 3% per year forever. there are 3 million shares outstanding and investors require a return of 8% on the company's stock. Using the constant growth model to find the terminal value, calculate the price of the company's stock.
Answer:
$278.75 per stock
Explanation:
FCF1 = $31.17 million
FCF2 = $35.54 million
FCF3 = $39.80 million
FCF4 = $43.78 million
FCF5 = $47.27 million
FCF6 = $50.11 million
since the FCF6 will grow at a constant 3% rate forever, then we can use the constant growth model to determine the price of the company at year 6, then we must discount it along with the rest of the cash flows:
company's value = ($50.11 x 1.03) / (8% - 3%) = $1,032.27 million
now we can discount the FCFs:
$31.17/1.08 + $35.54/1.08² + $39.80/1.08³ + $43.78/1.08⁴ + $47.27/1.08⁵ + $50.11/1.08⁶ + $1,032.27/1.08⁶ = $28.86 + $29.37 + $31.59 + $32.18 + $32.17 + $31.58 + $650.51 = $836.26 million
price per stock = $836.26 million / 3 million stocks = $278.75 per stock
What is the present value of $2,025 per year, at a discount rate of 7 percent, if the first payment is received 6 years from now and the last payment is received 23 years from now
Final answer:
The present value of a series of future payments is calculated using the present value of annuity formula, which is then discounted back to the present if the payments start in the future. This approach is analogous to calculating the present value of a bond payment stream, involving discounting future cash flows at a given rate.
Explanation:
The present value of an annuity is calculated to determine the value of a series of future payments in today's dollars, adjusted for interest over time. In this case, we want to find the present value of $2,025 received annually, starting 6 years from the present and continuing to be received for 18 years (from year 6 to year 23).
Firstly, it's important to note that the present value of an annuity (PVA) formula is used which is:
PVA = PMT [ (1 - (1 + r)-n) / r ]
Where PMT is the annual payment, r is the discount rate (expressed as a decimal), and n is the number of payments. However, since the payments begin 6 years from now, we must discount this entire annuity back to the present value by five more years (since the first payment received in year 6 is effectively the 'present' for our calculation of the annuity).
The steps involved are as follows:
Calculate the present value of the annuity of $2,025 received from year 6 to year 23 using the PVA formula at a 7 percent discount rate. Adjust the resultant value to present date by discounting it back an additional 5 years at the same 7 percent rate. Add up the two present values to find the total present value of the annuity.
To calculate the present value of a bond as explained in Table C2, you also apply a similar present value formula by adjusting future cash flows to their present value and summing them up.
The human MN blood group is determined by two codominant alleles, M and N. The following data were obtained from various human populations:
Percentages*
Population
Place
MM
MN
NN
Inuit
East Greenland
83.5
15.6
0.9
Navajo Indians
New Mexico
84.5
14.4
1.1
Finns
Karajala
45.7
43.1
11.2
Russians
Moscow
39.9
44.0
16.1
Aborigines
Queensland
2.4
30.4
67.2
a. Calculate the allele frequencies in these five populations. b. Which populations appear to be in Hardy-Weinberg equilibrium? c. Which populations do you think have had significant intermixing due to migration?
Answer:
Explanation:
Note: The table containing the data is attached as a file to this solution.
Also note that the values are given in percentages in the table, the decimal equivalents of those values are used in this calculation.
a)
i) Allele Frequency in the Inuit population
M allele frequency
= 0.835+(0.156/2) = 0.913
N allele frequency
= 0.009 + (0.156/2) = 0.087
ii) Allele frequency in Navojo Indian population
M allele frequency
= 0.845+0.072 = 0.917
N allele frequency
= 0.011+0.072 = 0.083
iii) Allele frequency In Finn population
M allele frequency
= 0.457+0.2155 = 0.6725
N allele frequency
= 0.112+0.2155 = 0.3275
iv)Allele frequency In Russian population
M allele frequency
= 0.399+0.22 = 0.619
N allele frequency
= 0.161+0.22 = 0.381
v) Allele frequency In Aborigines
M allele frequency
= 0.024+0.152 = 0.176
N allele frequency
= 0.672 + 0.152 = 0.824
b)
We can observe that the sum of the frequencies of M and N alleles in each of the populations above is 1. Therefore, all the populations are in Hardy Weinberg's equilibrium.
c)
It can be again observed that the M and N allele frequencies of the Finn and the Russian population are almost the same, then it is safe to say that the Finn and Russian population have had significant intermixing due to migration.
You were hired as a consultant to restructure operating capital. The recommended goal is for the firm to have a capital structure is 33% debt, 8% preferred, and 59% common equity. The interest rate on new debt is 6.50%, the yield on the preferred is 6.00%, the cost of retained earnings is 11.25%, and the tax rate is 28%. The firm will not be issuing any new stock. The firm's projected WACC is ______%
Answer:
The WACC is 8.66%
Explanation:
The WACC or weighted average cost of capital is the cost to firm of its capital structure which can have 3 components namely debt, preferred stock and common stock. We take the weighted average of these components and their respective costs to calculate WACC. Furthermore, we take the after tax cost of debt for WACC calculation and that is why we multiply the cost of debt by (1-tax rate).
WACC = wD * rD * (1-tax rate) + wP * rP + wE * rE
WACC = 0.33 * 0.065 * (1-0.28) + 0.08 * 0.06 + 0.59 * 0.1125
WACC = 0.086619 or 8.86619% rounded off to 8.66%
The firm's projected Weighted Average Cost of Capital (WACC), calculated based on the given capital structure, costs of debt, preferred equity, retained earnings, and tax rate, is 8.15%.
The question involves calculating the Weighted Average Cost of Capital (WACC) for a firm with a specific capital structure. The firm's goal is to have a structure of 33% debt, 8% preferred equity, and 59% common equity. Given the interest rates and costs associated with each type of capital and the firm's tax rate, we can calculate the WACC. The cost of debt will be adjusted for taxes, as interest is tax-deductible, leading to an after-tax cost of debt.
To compute the WACC, use the formula: WACC = (% of debt * after-tax cost of debt) + (% of preferred equity * cost of preferred equity) + (% of common equity * cost of common equity). Therefore, after-tax cost of debt = 6.50% * (1 - 0.28) = 4.68%. Using the data provided:
Weight of debt = 33%After-tax cost of debt = 4.68%Weight of preferred equity = 8%Cost of preferred equity = 6.00%Weight of common equity = 59%Cost of retained earnings (common equity) = 11.25%WACC = (0.33 * 4.68%) + (0.08 * 6.00%) + (0.59 * 11.25%) = 8.15%.
Therefore, the firm's projected WACC is 8.15%%.
Bob Hanson emphasizes that sending MBSC employees to seminars on a regular basis is highly motivating. It’s possible that for some employees, having to attend seminars is a burden. However, for an employee like Marco, who was excited when he found out he could major in strength and conditioning in college, having the opportunity to further their professional development is a major source of satisfaction and it motivates him to work hard for MBSC. Professional development is described in different ways by different theories of motivation.
If Bob and Mike were analyzing how they motivate their employees in terms of Maslow’s hierarchy of needs, which of the following would be true?
1. Attending seminars could meet an employee’s need for self-actualization, but this would be motivating only if pay, job security, inclusion, and recognition needs were also met.
2. Learning at seminars could meet an employee’s need for growth, and if the employee were not allowed to attend seminars, then he or she might desire greater participation at work or more pay.
3. The recognition and autonomy offered by attending seminars would result in satisfaction, but employees might also be dissatisfied if pay were poor or their ideas were not valued.
4. Employees with a high need for achievement would find the opportunity to learn advanced skills at seminars very motivating, while those with a high need for affiliation or power would be less motivated by seminars.
Marco says he was an economics major in college until he discovered he could major in strength and conditioning. Then he switched majors. Clearly, learning about this field is important to him. Mike and Bob are addressing (effort to performance expectancy, effort, performance to outcome expectancy, or valance)? when they send Marco to seminars instead of, for example, increasing his salary in exchange for his continued high performance at MBSC.
They could maintain Marco’s high level of motivation by?
1. Sending him on an all-expense-paid Caribbean cruise for two weeks
2. Reassuring him that he has a job with MBSC as long as he performs well
3. Reimbursing his tuition as he seeks a master’s degree in fitness management
4. Setting up an employee discount program at a nearby coffee shop, laundromat, and tanning salon
Mike Boyle says he has read that meeting with employees regularly is important to motivation. Despite the fact that he and Bob hold weekly staff meetings with their employees, Mike believes they should meet more often. He knows that employee meetings should have a purpose, and he asks you for advice.
Which of the following purposes for meeting with a staff member could be motivational? Check all that apply.
1. To correct misperceptions around equity
2. To fulfill the need for belongingness
3. To set specific, challenging goals
4. To use extinction on an undesirable behavio
Answer to Question 1:
Option 3 would be TRUE in this case.
Explanation:
According to Abraham Maslow's hierarchy of needs, Self Esteem Needs are directly below the cadre of Self-Actualization Needs. According to this Abraham Maslows theory, one can only think and appreciate offers relating to Self-Actualization such as training if their self- esteem needs are met.
This makes good sense. If Mike and Bob are narcissistic bosses always treating their workers like garbage then sending them off to training as a way to reward their "hard work", that would be very counterproductive.
Please see the attached diagram for a synopsis of Abraham Maslows Hierarchy of Needs.
Answer to Question 2:
The correct option here is 3)
Explanation.
This next question is based on the Expectancy Theory which states that people will always act in a certain way because of the outcome they expect from that behavior.
One way to keep Marco motivated would be to reimburse his tuition as he seeks a Masters Degree in Fitness Management only on the condition that his increased skill and learning in that field are equally beneficial to the company. If it is beneficial to the company, then it means that increasing his ability to solve such problems will also translate to an increase in MBSC's bottom line. If he is helping the company attain its strategic goals then he ought to be rewarded as well. As this kind of cycle continues, the company grows, employees like Mike will grow and everyone is happy, all other things being equal.
Answer to Question 3
The correct choices are:
1, 3 and 4.
Explanation:
Meetings, if constructively planned can be used to resolve misperceptions relating to equity. This can be very demotivating where an employee feels undervalued in relation to others;Meetings can be used to re-evaluate performance and how one has performed in relation to those goals. Challenges to performance and solutions to the same can be discussed. In many cases, the goals only need to be made more specific to ignite performance.Meetings are also good avenues to constructively address undesirable behaviors.Cheers!
Attending seminars could meet an employee’s need for self-actualization, Bob and Mike motivate Marco by sending him to seminars instead of increasing his salary, and meeting with staff members to fulfill the need for belongingness and to set specific, challenging goals can be motivational.
Explanation:If Bob and Mike were analyzing how they motivate their employees in terms of Maslow’s hierarchy of needs, option 1 would be true. Attending seminars could meet an employee’s need for self-actualization, but this would be motivating only if pay, job security, inclusion, and recognition needs were also met. In terms of motivating Marco, Bob and Mike are addressing the valance aspect when they send him to seminars instead of increasing his salary. They could maintain Marco’s high level of motivation by reimbursing his tuition as he seeks a master’s degree in fitness management. In terms of purposes for meeting with a staff member, options 2 and 3 could be motivational. Meeting to fulfill the need for belongingness and setting specific, challenging goals can both have motivational effects.
Learn more about Employee Motivation here:https://brainly.com/question/34546732
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Asonia Co. will pay a dividend of $3.90, $8.05, $10.90, and $12.65 per share for each of the next four years, respectively. The company will then close its doors. If investors require a return of 11 percent on the company's stock, what is the stock price
Answer:
Stock price today $26.34
Explanation:
The stock price today is the sum of the present value of the future cash flows(dividends) payable by the stock to investors using the 11% reuired rate of return as the discount rate:
Years Cash flows Discount factor Present values
1 $3.90 1/(1+11%)^1=0.900900901 $3.51
2 $8.05 1/(1+11%)^2=0.811622433 $6.53
3 $10.90 1/(1+11%)^3=0.731191381 $7.97
4 $12.65 1/(1+11%)^4=0.658730974 $8.33
Total present values =$3.51+$6.53+$7.97+$8.33=$26.34
Answer:
Price of stock = $57.26
Explanation:
According to the dividend valuation model , the current price of a stock is the present value of the expected future dividends discounted at the required rate of return.
So we will discount the steams of dividend using the required rate of 11% as follows:
Year Present Value(PV)
1 $3.90 × 1.11^(-1) = 1.486
2 $8.05× 1.11^(-2) = 1.322
3 $10.90× 1.11^(-3) = 1.2064
Year 4 and beyond
This is annuity of 12.65 for four years. So the steams of constant amount would be discounted as follows:
PV = A × (1- (1+r)^(-n) )/r
A- 12.65, r - 0.11, n - 4
PV = 12.65 × (1- 1.11^(-4))/0.11 = 39.24593797
Total PV= 1.486 + 1.322 + 1.2064 + 39.24= $57.26
Price of stock = $57.26
Melbourne Company uses the perpetual inventory system and LIFO cost flow method. Melbourne purchased 2,300 units of inventory that cost $15.50 each. At a later date, the company purchased an additional 2,400 units of inventory that cost $16.00 each. If the company sells 2,600 units of inventory, what amount of ending inventory will appear on a balance sheet prepared immediately after the sale
Answer:
$32,550
Explanation:
LIFO means last in first out. It means that it is the last purchased inventories are the first to be sold.
Total inventory = 2,300 + 2,400 = 4,700
Ending inventory = 4700 - 2600 = 2,100
The ending inventory would be the first purchased inventory
Ending inventory = 2100 x $15.50 = $32,550
I hope my answer helps you
Final answer:
Using the LIFO cost flow method and the perpetual inventory system, the ending inventory for Melbourne Company after selling 2,600 units would be calculated as the remaining units from the initial purchase multiplied by their cost, resulting in an ending inventory value of $32,550.
Explanation:
The subject of the question is the calculation of ending inventory using the perpetual inventory system and the LIFO cost flow method in the context of accounting for a company's inventory transactions. To calculate the ending inventory after the sale of 2,600 units when Melbourne Company uses the LIFO method, we need to determine the cost of the units remaining.
Firstly, Melbourne purchased 2,300 units at $15.50 each. Then, they bought another 2,400 units at $16.00 each. After selling 2,600 units, and considering that LIFO means 'last in, first out', the most recent purchases are sold first.
Therefore, 2,400 units will be sold from the second purchase and 200 units from the first purchase, leaving the company with 2,100 units remaining from the initial purchase at $15.50 each. The calculation of the ending inventory is 2,100 units times $15.50, which equals $32,550. This will be the amount of the ending inventory appearing on the balance sheet immediately after the sale.
How does the planning and control of variable manufacturing overhead costs differ from the planning and control of fixed manufacturing overhead costs? Planning and control of ▼ manufacturing overhead costs has both a long-run and a short-run focus. The long-run focus involves Revolutions planning to ▼ and for the short-run focus to ▼ manage the cost drivers of value-added overhead activities undertake only value-added overhead activities in the most efficient way. Planning and control of ▼ fixed variable manufacturing overhead costs have primarily a long-run focus. It involves ▼ managing the cost drivers of value-added fixed overhead activities undertaking only value-added fixed-overhead activities for a budgeted level of output. Revolutions makes ▼ none most of the key decisions that determine the level of overhead costs at the start of the accounting period.
Answer and Explanation:
The variable manufacturing overhead costs are indirect manufacturing costs of an organization that change as the level of production or sales change such as factory power. Fixed manufacturing overhead costs differ from the former as they are indirect but do not change with change in production level or sales
Planning and control of variable manufacturing overhead costs encompasses both long-run and short-run focus. It involves solutions planning for overhead activities that add value which takes the long-run view while managing the cost drivers of those activities efficiently is the short run aspect of planning and control of variable manufacturing overhead costs. On the other hand planning and control of fixed manufacturing overhead costs have primarily a long-run focus.
Variable manufacturing overhead costs, which include variable factors like raw materials and energy costs, can be managed in both the short and long run, focusing on production levels and efficiency. Fixed manufacturing overhead costs, such as management salaries and lease payments, are static in the short run but become variable in the long run where all costs can be adjusted with strategic planning. The time horizon is crucial in determining the treatment and control of these costs.
The planning and control of variable manufacturing overhead costs take into account the costs directly tied to production levels, such as raw materials, salaries of production workers, and utility costs. These costs fluctuate with the number of units produced and can be managed in the short run by controlling cost drivers and focusing on efficiency in value-added activities.
Fixed manufacturing overhead costs, on the other hand, include expenses like management salaries and lease payments, which are contractually set for a period and are independent of the production volume. These costs are considered fixed in the short run but can become variable in the long run as contracts can be renegotiated, and operational changes can be implemented. In the long run, the firm can plan for these changes, turning fixed costs into variable as production factors and structure of costs can be altered.
The planning and control of variable and fixed manufacturing overhead costs involve different management practices due to the inherent nature of these costs over different time horizons. While variable costs can be managed both in the short and long run, fixed costs are often primarily a consideration for the long-term planning process as their variability comes into play over extended periods.
Planners for a company that makes several models of skateboards are about to prepare the aggregate plan that will cover six periods. They have assembled the following information:Period 1 2 3 4 5 6 totalForecast 200 200 300 400 500 200 1800CostsOutput Regular Time = $2 per skateboardovertime = $3 per skateboardsubcontract = $6 per skateboardInventory = $3 per skateboardBack orders = $5 per skateboard per periodThey now want to evaluate a plan that calls for a steady rate of regular-time output, mainly using inventory to absorb the uneven demand but allowing some backlog. Overtime and subcontracting are not used because they want steady output. They intend to start with zero inventory on hand in the first period. Assume a level output rate of 300 units (skateboards) per period with regular time (i.e., 1,800/6 = 300). Note that the planned ending inventory is zero. There are 15 workers, and each can produce 20 skateboards per period.The president of the firm has decided to shut down the plant for vacation and installation of new equipment in period 4. After installation, the cost per unit will remain the same, but the output rate for regular time will be 450. Regular output is the same for periods 1, 2, and 3; 0 for period 4; and 450 for each of the remaining periods. Note, though, that the forecast of 400 units in period 4 must be dealt with.Prepare the aggregate plan, and compute its total cost. (Negative amounts should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required. Omit the "$" sign in your response.)
Answer:
Total costs = $4,850.
Please refer to the attached for the answered table.
Steady/fixed Production planning with the objective of saving on overtime and subcontract costs is a form of aggregate planning that organizations pursue in managing its total costs of production.
As a result of this model of planning, we will have inventory on hand in some periods and we will run partially or completely out of stock in others. But because the production unit is aware of their production targets , overtime will be zero and there will be no need for subcontracting.
However delayed order fulfillment will be made up for at additional costs as in the example we are solving. This provisions must be made for such eventualities.
announced today that it will begin paying annual dividends next year. The first dividend will be $0.10 a share. The following dividends will be $0.15, $0.20, $0.50, and $0.60 a share annually for the following 4 years, respectively. After that, dividends are projected to increase by 5 percent per year. How much are you willing to pay to buy one share of this stock today if your desired rate of return is 9.5 percent
Answer:
The maximum that should be paid for the stock today is $9.99
Explanation:
The price of the stock today can be calculated using the dividend discount model or DDM which values a stock based on the present value of the expected future dividends of the stock. The price of the stock today is,
P0 = 0.10 / (1+0.095) + 0.15 / (1+0.095)^2 + 0.20 / (1+0.095)^3 +
0.50 / (1+0.095)^4 + 0.60 / (1+0.095)^5 + [ (0.60 * (1+0.05) / (0.095 - 0.05)) / (1+0.095)^5 ]
P0 = $9.99
Trout Lumber Yard has a current accounts receivable balance of $527,164. Credit sales for the year just ended were $6,787,626. a. What is the receivables turnover? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. What is the days’ sales in receivables? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. How long did it take on average for credit customers to pay off their accounts during the past year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Answer:
a. 12.88 times
b. 28.35 days
c. 28.35 days
Explanation:
a. Receivables turnover
Receivables turnover = Credit sales ÷ Receivables
= $6,787,626 ÷ $527,164
= 12.88 times
b. Days’ sales in receivables
Days' sales in receivables = 365 days ÷ Receivables turnover
= 365 ÷ 12.88
= 28.35 days
c. On average it would take 28.35 days for credit customers to pay off their balances during the last year.
At the end of 2020, Concord Company has accounts receivable of $784,000 and an allowance for doubtful accounts of $39,200. On January 16, 2021, Concord Company determined that its receivable from Ramirez Company of $5,880 will not be collected, and management authorized its write-off.
Prepare the journal entry for Concord Company to write off the Ramirez receivable.
Answer:
Journal Entry
Dr. Allowance for doubtful accounts $5,880
Cr. Account Receivable $5,880
Explanation:
When a receivable of the business is considered to be non-collectible from a customer, it is written off from the accounts. This event will decrease the account receivable balance and allowance for the doubtful accounts too. a Debit entry in the Allowance for doubtful account and a credit entry in accounts receivable is made to incorporate the effect of this transaction.
Surreal Corp. has borrowed to invest in a project. The loan calls for a payment of $17,500 every month for three years. The lender quoted Surreal a rate of 8.40 percent with monthly compounding. At what rate would you discount the payments to find amount borrowed by Surreal Corp.
Answer:
The rate at which to discount the payments to find sum borrowed is 12.68%
Explanation:
The discount rate to be used in computing the sum borrowed can e derived from the effective annual rate formula below:
Effective annual rate = (1 + Quoted interest rate/m)^m - 1
quoted interest rate is 8.40
m is the number of months in a year when compounding is done which is 12
effective annual rate=(1+8.40%/12)^12-1
effective annual rate=(1+0.01)^12-1
effective annual rate=(1.01)^12-1
effective annual rate=1.12682503 -1
effective annual rate=0.12682503=12.68%
Final answer:
The discount rate used to calculate the present value of Surreal Corp's loan payments, based on a quoted interest rate of 8.40 percent with monthly compounding, is the monthly equivalent of this annual rate, which is 0.7%.
Explanation:
The question asks at what rate the payments should be discounted to find the amount borrowed by Surreal Corp. Given that the loan has a quoted rate of 8.40 percent with monthly compounding, the discount rate to find the present value of the loan payments is simply this quoted interest rate. The monthly interest rate is central to computing the present value of an annuity, which in this case, is the series of $17,500 payments made every month for three years. Using the formula for the present value of an annuity, we would use the monthly interest rate derived from the annual rate of 8.40%, which is 0.7% (0.084/12).
On December 31, 2021, Larry's Used Cars had balances in Accounts Receivable and Allowance for Uncollectible Accounts of $54,000 and $1,050, respectively. During 2022, Larry's wrote off $1,625 in accounts receivable and determined that there should be an allowance for uncollectible accounts of $5,700 at December 31, 2022. Bad debt expense for 2022 would be:
Answer:
$6,275
Explanation:
Allowance for Uncollectible-opening ($1,050)
Allowance for Uncollectible-closing $5,700
Allowance provided specially $1,625
Bad Debt Expense $6,275
Javier is retiring from the JKL Partnership. In January of the current year, he has a $100,000 basis in his partnership interest when he receives a $10,000 cash distribution. The partnership plans to distribute $10,000 each month this year, and Javier will cease to be a partner after the December payment. Is the January payment to Javier a current distribution or a liquidating distribution?
Answer:
The payments are all part of a LIQUIDATING DISTRIBUTION
Explanation:
The payments are all part of a LIQUIDATING DISTRIBUTION and not current distribution because a liquidation distribution can said to be a single distribution or one of a planned series of distributions that terminates a partner's entire interest in the partnership while Current distributions can be said to be all other distributions thay include those that reduce or decrease a partner's interest in the partnership.
Therefore in accordance with the liquidation, distribution laws Javier would have to recognize a gain or profit of $20,000 at the end of the year so to the fact that he only had $100,000 basis but is receiving $120,000 (12*10000).
Thus the partnership will not have to recognize a gain or a loss according to the information provided.
Answer: Liquidating distribution
Explanation:
A Liquidating distribution refers to when a company completely terminates the partnership of one of its partners by issuing a distribution that covers the basis of the Partners Capital. In other words, the entire amount of the Shareholders equity is distributed.
Javier was paid the liquidating Distribution knowing that he would leave the company after the last payment.
It is worthy of note that if the Distribution exceeds the amount of the partner's basis which in this case is $100,000, that constitutes a gain on their part. Javier therefore is making a gain.
Both Bond A and Bond B have 9.6 percent coupons and are priced at par value. Bond A has 8 years to maturity, while Bond B has 20 years to maturity. a. If interest rates suddenly rise by 2.2 percent, what is the percentage change in price of Bond A and Bond B? (A negative value should be indicated by a minus sign. Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)
Answer:
Change in Bond A price is -11.01%
Change in Bond B price is -16.64%
Explanation:
The starting to solving this question would be to calculate the initial prices of both bonds at 9.6% and their prices when interest rose by 2.2%
When bonds are issued at par of $1000 both yield to maturity and coupon rate are the same.invariably the bonds were issued at $1000 each
However,when yield to maturity increases by 2.2%,the new yield to maturity is 9.6%+2.2%=11.8%,the new prices can determined as follows:
The bond price can be computed by using the pv formula in excel,which is given below:
=-pv(rate,nper,pmt,fv)
Bond A
rate is now 11.8%
nper is the number of times the bond pays coupon interest over the life of the bond,which is 8
pmt is the annual coupon payable by the bond,which is $1000*9.6%=$96
fv is the face value of $1000 at which the bond would be retired.
=-pv(11.8%,8,96,1000)=$ 889.94
Change in Bond A price=($889.94-$1000)/$1000=-11.01%
Bond B
rate is now 11.8%
nper is the number of times the bond pays coupon interest over the life of the bond,which is 20
pmt is the annual coupon payable by the bond,which is $1000*9.6%=$96
fv is the face value of $1000 at which the bond would be retired.
=-pv(11.8%,20,96,1000)=$833.59
Change in Bond B price=($833.59-$1000)/$1000=-16.64%
Terry Williams sustained physical. injuries in an accident involving, a' vehicle driven by Kellie Meagher. At the time' of the accident, Meagher was allegedly using a cellular phone furnished by Cingular Wireless. Williams later' sued: Meagher and Cingular in an Indiana court. In the portion of the complaint pertaining to Cingular, Williams alleged that Cingular was negligent in furnishing a cellular phone to Meagher when it knew, or should have known, that the phone would be used while the user operated a motor vehicle. Cingular filed a motion to dismiss for failure to state a claim on which relief could be granted. After the trial court granted Cingular's motion, Williams appealed to the Indiana Court of Appeals. Was the trial court correct in granting Cingular's motion to dismiss?
Answer:
Negligent tort is a tort which is submitted by the disappointment so as to go about as a reasonable and levelheaded individual with somebody, to whom s/he may owe an obligation, according to law in specific situations.
Individual T recorded a suit against Company C and individual K as he endured physical wounds while in a mishap with Person K. Around then, individual K was utilizing a phone, which was outfitted by Company C. Individual T asserted that C realized that the telephone could be utilized while riding an engine vehicle and was careless about it. C documented a movement for excusing the case because the offended party had neglected to express the case to which help could be allowed. A preliminary court allowed the movement recorded by C. Be that as it may, individual T claimed against that award.
According to the legitimate rules, so as to demonstrate the tort of carelessness, the offended party must demonstrate that the carelessness was the real and proximate reason for injury endured by the offended party. For this situation, the party in question was just the driver and C had no immediate or backhanded relations with the case, despite the fact that Person K was utilizing a mobile phone. There was no chance to get wherein C could determine if the telephone would wind up in a destroyed vehicle. Additionally, the risk for a mishap like this is just on the individual utilizing the telephone, not on the organization. Hence, it tends to be expressed that the preliminary court was directly in its choice of allowing C's movement to excuse the case.
in Louisiana, it was a crime to sell burial caskets without a funeral director's license. This law was a source of _____ for licensed funeral directors and an example of _____. A. monopoly power; a legal barrier to entry B. product differentiation; economies of scale C. monopoly power; a natural barrier to entry D. competition; decreasing average costs
Answer:
The correct option is A,monopoly power,a legal barrier to entry
Explanation:
Monopoly power is the exclusive right granted to a business or a group of professionals in order to produce a particular good or provide a service.
The fact that no one else can give the go-ahead to purchase casket except the funeral directors is a form of monopoly.
However,this arrangement has a knock-on effect ,which is the legal barrier to entry. It is a legal barrier because it was created by law.
Option C is is wrong because the barrier is legal not natural barrier,natural barriers are usually as a result of exclusive ownership of major input of production