Answer: D - Leniency Error
Explanation: Leniency Error is a subjective appraisal by an employer. This error is based on the employers perception of the employee.
Leniency error gives the employee a perception that he/ she needs no improvement at work due to the high rating from his employer which is not a general appraisal.
The employer only appraises the employee on an aspect of work while other aspect are left. This makes the employee loose focus on areas of improvement and focus more on his high appraisal.
A borrower takes out a 30-year adjustable rate mortgage loan for $200,000 with monthly payments. The first two years of the loan have a "teaser" rate of 4%, after that, the rate can reset with a 5% annual payment cap. On the reset date, the composite rate is 6%. What would the Year 3 monthly payment be?
a. $955
b. $1,067
c. $1,003
d. $1,186
e. Because of the payment cap, the payment would not change.
Answer:
1003
Explanation:
Given:
Period= 30 years, Loan amount= $200,000,
Payments- Monthly,
Teaser rate for first 2 years = 4%,
Annual payment cap=5%, Composite rate on reset date= 6%
Annual rate for 2 years =4%
Monthly rate will be 4/12 = 0.3333% = 0.003333
n=30years=360 months
Monthly payment for first 2 years = [tex]Pr(1+r)^n/((1+r)^n-1)[/tex]
= [tex]200000\times0.0033\times1.033^{360}/(1.033^{360}-1)[/tex]
= 954.83
or by Excel function = PMT(0.003333,360,200000,0) = 954.83
Loan balance after 2 years = PV(0.003333,336,-954.83,0) = 192,812.36 or
Balance=[tex]A(1+r)^n-PMT\times(1+r)^n-1)/i[/tex]
=[tex]200000(1.0033)^{24}-954.83(1+0.003333)^{24}-1)/0.003333[/tex]
= 192,812.36
Composite rate is 6% but payment is capped at 5%. So new payment from year 3 is 954.83×1.05=1002.57=1003
During and after the financial crisis of 2007minus2009, the Fed greatly increased the supply of reserves through three rounds of quantitative easing by A. purchases of long-term Treasury securities and sales of mortgage-backed securities. B. sales of both long-term Treasury securities and mortgage-backed securities. C. sales of long-term Treasury securities and purchases of mortgage-backed securities. D. purchases of both long-term Treasury securities and mortgage-backed securities.
Answer:
D) purchases of both long-term Treasury securities and mortgage-backed securities.
Explanation:
Quantitative easing is basically a large scale purchase of securities carried out by the FED. When the FED purchases long term Treasury securities, or any other type of security including mortgage backed securities, it is increasing the economy's money supply. Since the economy was facing a very deep recession, by increasing the money supply the FED was trying to boost the economy and make it rebound.
What is the correct answer Even when competitive firms are unable to calculate marginal revenue product directly,
A) will push wage rates toward the marginal revenue product of labor.
B) planned future investment in physical capital
C) the pressures of competition in the labor market
D) the marginal workers ongoing skills training
E) wages that exceed workers' net revenue product
Answer: The corrects answers are "C) the pressures of competition in the labor market" and A) will push wage rates toward the marginal revenue product of labor.".
Explanation: Because the correct and complete statement would be: Even when competitive companies cannot directly calculate the product of marginal income, the pressures of competition in the labor market will push wage rates towards the product of marginal income from labor.
Making it clear that the strong pressures that are the product of competition in the labor market pushed wage rates towards the product of marginal income.
4. Treasury bills, notes, and bonds Suppose you purchase a corporate bond that is due in one year, with a face value of $100 and an annual coupon rate of 6.5%. Coupons are paid at the end of each year. The annual coupon payment is . If the current yield is 5.0%, then the price paid for the bond is . Suppose interest rates increase. The price of your existing corporate bond will .
Answer:
1) $6.50
2) $130
3) Decrease
Explanation:
Answer:
The answers are as follows:
Annual coupon payment: $6.50
Bond Price: $101.43 (rounded to 2 decimal places).
If interest rates rise, the price of your existing corporate bond will fall.
Explanation:
A bond is a fixed income security. The issuer of the bond has to pay a fixed amount to the holder of the bond every period. These payments are known as coupon payments and calculated based on the contractual coupon rate and the face value of the bond. In this case, the coupon payments amount to 6.5% (0.065) * $100 = $6.05.
A bond's price is the present value of all future anticipated cash flows. To calculate this, the prevailing market interest rate or yield (5%) is used to discount the cash flows. Since the period is only one year and the coupon rate is annual, the repayment of the face value of the bond will coincide with the coupon payment. At the end of the year $106.5 ($100 (face value) + $6.5(coupon) will be paid out. The discounting of this amount is as follows:
Present value (bond price) = Future Value/(1 + yield)^1
$101.4285714 = $106.5/(1+0.05)^1 where the numerator is the total amount paid at year end and the denominator is the discounting factor raised to the power of 1 to signify the duration of one time period or a year.
Interest rates and bond prices have an inverse relationship. The higher the interest rate, the lower the bond price and vice versa. Using the formula above, if the yield was lower than 5%, say 3% then the bond price would be $103.4 but if the yield was higher than 5%, say 7% then the bond price would be $99.53
Which of the following situations would not result in auditors adding an additional paragraph to their report without modifying the introductory, scope, or opinion paragraphs of that report?A. Reference to a change in the method of accounting mandated by the issuance of a new accounting standard.B. Reference to a going-concern uncertainty facing the entity.C. Reference to a departure from GAAP that is material, but not pervasive, to the financial statements.D. Reference to an acquisition made by the entity during the most recent fiscal year.
Answer:
The answer is letter C.
Explanation:
The situation that would not result in auditors adding an additional paragraph to their report is reference to a departure from GAAP that is material, but not pervasive, to the financial statements.
Harrison is self-employed. He sells advertising specialty items like calendars, pens, etc., imprinted with the name and advertising message of local businesses who give the items to customers and prospects. He has set for himself a goal of earning $180,000 in sales for this year. Harrison's revenue goal is an example of a(n) _____ goal.
Answer: Performance goals
Explanation: In simple words, performance goals refers to the short term objective that are set by someone for himself or by others, to perform a standard amount of work at a given time period in his or her current job or position in which the individual is working.
It can be seen as the expectations for performance of the work to be done in relation to quality or volume. These standards are based on various factors such as past performances, future trends and image or qualities of the individuals who is going to perform the duties.
Hence the goal of Harrison to make a certain amount of profit at a specified time period is an example of performance goals.
An advantage of the fixed-period inventory system is that______.
A) safety stock will be lower than it would be under a fixed-quantity inventory system.
B) there is no physical count of inventory items when an item is withdrawn.
C) no inventory records are required.
D) orders usually are for smaller order quantities.
E) the average inventory level is reduced.
Answer:
The correct answer is (B)
Explanation:
There are various advantages of fixed inventory stock. The fixed-period stock and inventory framework requires more safety stock than a fixed-amount framework. A stock out can happen during the audit time just as during the lead time. A significant advantage of fixed period stock is that, there is no physical check of stock when products are withdrawn.It helps to save time and money.
Final answer:
The advantage of a fixed-period inventory system is that it typically involves orders for smaller quantities, helping with cash flow and storage space. The correct answer is D.
Explanation:
An advantage of the fixed-period inventory system is that orders usually are for smaller order quantities. This inventory management approach is characterized by ordering at the end of a fixed period, which could be weekly, monthly, or by any other set time frame.
The amount ordered varies and depends on the inventory levels at the time of order, often resulting in smaller quantities compared to a fixed-quantity system where a constant amount is ordered whenever inventory drops to a particular level. Smaller order quantities can help businesses with cash flow and storage space management.
Island Home Goods pursues a related diversification strategy, deriving less that 70 percent of revenues from its original business unit, Island Furniture, and maintaining several related units including Island Lighting and Island Hardware. Which of the following structures is most likely to support this strategy?
A. M-Form with centralized decision-making power (cooperative multidivisional)
B. M-Form with centralized decentralized decision-making power (competitive multidivisional)
C. functional with centralized decision-making power
D. functional with decentralized decision-making power
Answer:
A. M-Form with centralized decision-making power (cooperative multidivisional)
Explanation:
For the firms which perform related or unrelated diversification, they always use the M-form organization structure and the power the take decisions is always centralized. This allows high level of integration of authority.
Elegance Bath Products, Inc. (EBP) makes a variety of ceramic sinks and tubs. EBP has just developed a line of sinks and tubs made from a mixture of glass and ceramic. The sinks sell for $150 each and have variable costs of $80. The tubs sell for $600 and have variable cost of $450. The glass and ceramic sinks and tubs require the use of specialized molding equipment. The specialized molding equipment has 4,050 hours of capacity per year. A sink uses an average of 2 hours of specialized molding equipment time; a tub uses an average of 5 hours of specialized molding equipment time.Assume that EBP can sell as many as 1,000 sinks and 500 tubs per year. How many tubs should EBP produce?a.1,000b.500c.410d.675e.zero
Answer:
C) 410 tubs
Explanation:
the contribution margin for sinks is $70 (= $150 - $80) and the contribution margin for tubs is $150 (= $600 - $450).
the molding equipment has 4,050 hours of capacity per year, so it can produce either 2,025 sinks or 810 tubs.
we can determine what product is more profitable if we determine a contribution margin per molding equipment usage ratio:
sink = $70 / 2 hours = $35 per hourtub = $150 / 5 hours = $30 per hourIt is more profitable to produce sinks than tubs, but we can sell only 1,000 sinks per year, so even after we product the 1,000 sinks we will have spare molding equipment capacity which we can use to produce tubs.
The spare molding equipment capacity after producing sinks = 4,050 total hours - 2,000 hours used to produce sinks = 2,050 spare molding hours
We can produce 410 tubs (= 2,050 molding hours / 5 hours per tub)
Allen bought a warehouse to hold his excess inventory for $3,220,000 four years ago. Allen would have to pay $3,979,000 to buy a similar warehouse now. At which amount should Allen report the warehouse on a Balance Sheet prepared in accordance with GAAP (Generally Accepted Accounting Principles)?
Answer:
$3,220,000
Explanation:
All assets have to be recorded at their cost basis, not their current fair market value.
Allen should have depreciated the value of the warehouse using a 39 year straight line depreciation for nonresidential real property = $82,564 depreciation expense per year x 4 years = $330,256.
Apparently Allen didn't record any depreciation expense for the warehouse, so he should use the cost basis.
During the month a company paid $62.75 for office supplies and $71.22 for miscellaneous expenses from the petty cash fund. The entry to replenish the petty cash fund at the end of the month would include:
Answer:
Debit Petty cash fund $133.97
Credit Bank account $133.97
Explanation:
On purchase of office supplies, the following entries are passed;
Dr Office supplies (p/l) $62.75
Cr Petty cash fund $62.75
On incurring the miscellaneous expenses, the following entries are passed;
Dr Miscellaneous expenses (p/l) $71.22
Cr Petty cash fund $71.22
Total credits to petty cash fund
= $62.75 + $71.22
= $133.97
This amount is withdrawn from the bank for the replenishment of the petty cash account. As such, the following entries are passed;
Dr Petty cash fund $133.97
Cr Bank account $133.97
Country A had a population of 1,000, of whom 600 worked an average of 8 hours a day and had a productivity of 2.5. Country B had a population of 800, of whom 560 worked 8 hours a day and had productivity of 3.0. Country
a. A had the higher level of real GDP and Country B had the higher level of real GDP per person
b. B had the higher level of real GDP and Country A had the higher level of real GDP per person
c. A had the higher level of real GDP and real GDP per person.
d. B had the higher level of real GDP and real GDP per person
Answer:
The answer is d. B had higher real GDP and real GDP per capita.
Explanation:
Total real GDP of country A ( in one working day): Number of working persons x average working hour per day x productivity = 600 x 8 x 2.5 = 12,000;
Total real GDP of country B ( in one working day): Number of working persons x average working hour per day x productivity = 560 x 8 x 3 = 13,440;
GDP per capita of country A (in one working day): Total real GDP of A ( in one working day)/ total population of A = 12,000 / 1,000 = 12;
GDP per capita of country B (in one working day): Total real GDP of B ( in one working day)/ total population of B = 13,440 / 800 = 16.8.
Thus, country B had higher level of real GDP and real GDP per person in comparison to country A.
d. B had the higher level of real GDP and real GDP per person
To determine which country has the higher level of real GDP and real GDP per person, we need to follow these steps:
Calculate the real GDP for each country.Calculate the real GDP per person for each country.Calculating Real GDP
Country A: Real GDP is calculated by multiplying the number of workers, the hours they work per day, and their productivity.
Real GDP Country A = Number of Workers x Hours Worked per Day x Productivity
Real GDP Country A = 600 x 8 x 2.5 = 12,000
Country B: Similarly, we use the same formula.
Real GDP Country B = Number of Workers x Hours Worked per Day x Productivity
Real GDP Country B = 560 x 8 x 3 = 13,440
Calculating Real GDP Per Person
Country A: Real GDP per person is calculated by dividing the real GDP by the total population.
Real GDP Per Person Country A = Real GDP / Total Population
Real GDP Per Person Country A = 12,000 / 1,000 = 12
Country B: Similarly, we calculate real GDP per person for Country B.
Real GDP Per Person Country B = Real GDP / Total Population
Real GDP Per Person Country B = 13,440 / 800 = 16.8
Conclusion
Country B has the higher level of real GDP (13,440 compared to 12,000), and Country B also has the higher level of real GDP per person (16.8 compared to 12). Therefore, the correct answer is d. Country B had the higher level of real GDP and real GDP per person.
Which of the following statements is TRUE?A. As the probability of a super-event decreases, the advantage of utilizing multiple suppliers diminishes.B. Large probabilities of a unique event decrease the likelihood of needing more suppliers.C. All suppliers will be disrupted simultaneously if either a super-event occurs or a super-event does not occur but a unique-event occurs for all of the suppliers.D. To compute the probability of all n suppliers being disrupted simultaneously, we assume that the probabilities are all dependent on each other.
Answer:
D
Explanation:
Studying MGMT 4010 Ch S11 on Quizlet: https://quizlet.com/304737596/mgmt-4010-ch-s11-flash-cards/?x=1jqU&i=utx3h
Which of the following statements is FALSE? The variance increases with the magnitude of the deviations from the mean. The variance is the expected squared deviation from the mean. Two common measures of the risk of a probability distribution are its variance and standard deviation. If the return is riskless and never deviates from its mean, the variance is equal to one.
Answer:
FALSE: If the return is riskless and never deviates from its mean, the variance is equal to one.
Explanation:
If the return is riskless and never deviates from its mean, the variance is equal to ZERO.
Variance is calculated by taking the sum of square of deviations from the mean.
Deviations is calculated by subtracting the returns from their mean.
If the return is riskless and never deviates from its mean, the deviations would always be zero, hence the sum of square of them (variance) would also be zero.
America First Electronics Inc. (AFE) is preparing to launch a set of new-to-the-world medical devices that are based on the same technology. These devices promise to revolutionize the healthcare industry. AFE must ideally attempt to stimulate:_________
A. primary demand for the product category.
B. joint demand for the product category.
C. selective demand for the product category.
D. replacement demand for the product category.
Answer: Option A
Explanation: In simple words, primary demand refers to the demand of a product that is new to the market. Generation of primary demand refers to attracting the customers to purchase a class of shares rather than for a particular brand.
These products are usually unique in their way and are developed through innovation and technology. Companies advertise these products to make potential costumers understand what are the uses of this product and how can it be helpful.
__________ would use the present value of an annuity due for which of the following transactions?
a. Noel Inc. rents a warehouse for 7 years with annual rental payments of $120,000 to be made at the end of each year.
b. Noel, Inc. borrows $20,000 and has agreed to pay back the principal plus interest in three years.
c. Noel, Inc. wants to deposit a lump sum to accumulate $50,000 for the construction of a new parking lot in 4 years.
d. Noel, Inc. rents a truck for 5 years with annual rental payments of $20,000 to be made at the beginning of each year.
Answer:
A and D
Explanation:
If a periodic sum is to be paid or received, an annuity must be used since this means a series of uniform payments, therefore in addition to this and the time an interest rate is required to find the present value of the payments you must use in excel PV (present value) function and you need aside these data an interest rate.
Eddy Corporation had net credit sales during the year of $800,000 and cost of goods sold of $500,000. The balance in receivables at the beginning of the year was $100,000 and at the end of the year was $150,000. How much is the accounts receivables turnover?a.8.0b.5.3c.6.d.4.0
Answer:
None of the given options.
Accounts turnover ratio is 6.4 times.
Explanation:
Financial Statements depicts the financial position of a firm at a particular point of time or specified date. The users of financial statements use various types of analysis to understand or compare the current financial statements of the company to prior years or with those of the competitors.
‘Ratio Analysis’ is used to analyze the performance of a company. It is used to analyze the liquidity, profitability, solvency and operational efficiency of the company.
Given:
Net credit sales = $800,000
Beginning accounts receivable = $100,000
Ending accounts receivable = $150,000
Accounts receivable turnover is the ratio of net credit sales to average accounts receivable.
It can be calculated as:
Average accounts receivable = [tex]\frac{Beginning accounts receivable + Ending accounts receivable}{2}[/tex]
Average accounts receivable = [tex]\frac{100,000 + 150,000}{2}[/tex]
Average accounts receivable = [tex]\frac{250,000}{2}[/tex]
Average accounts receivable = $125,000
Accounts turnover ratio = [tex]\frac{Net credit sales}{Average accounts receivable}[/tex]
Accounts turnover ratio = [tex]\frac{800,000}{125,000}[/tex]
Accounts turnover ratio =6.4 times
DiskSan has to order flash transistors ($5 each) to create USB flash memory drives. Their monthly demand is 10,000 units, their holding cost (which is mostly comprised of obsolescence costs) is 10% per month per dollar in inventory, and the setup costs for an order is $5 (mostly paperwork etc.). Determine the economic order quantity for these flash transistors.
Answer
Economic order quantity will be 447.21
Explanation:
We have given monthly demand = 10000 units
We know that 1 year = 12 month
So Annual demand (D) = monthly demand × 12 months = 10000 × 12 = 120000 units
Cost of transistor = $5 per unit
Monthly Holding cost = 10% of cost = 10% of $5 = $0.50
So annual holding cost (H) = monthly holding cost × 12 = $0.50 × 12 = $6
Setup cost(S) = $5
We know that economic order quantity is given by
Economic order quantity = [tex]\sqrt{\frac{2DS}{H}}=\sqrt{\frac{2\times 12000\times 5}{6}}=447.21[/tex]
Final answer:
The Economic Order Quantity (EOQ) for DiskSan, given a monthly demand of 10,000 units, setup costs of $5, and a holding cost of 10% per month, is determined to be 1,000 units. This calculation is based on converting the monthly demand to yearly, applying the EOQ formula, and calculating the holding costs on a yearly basis.
Explanation:
The question asks to determine the Economic Order Quantity (EOQ) for DiskSan, a company that orders flash transistors to create USB flash memory drives. The EOQ model is essential for minimizing the total cost associated with the ordering and holding of inventory. To calculate EOQ, we use the formula: \(EOQ = \sqrt{\frac{2DS}{H}}\), where D is the yearly demand, S is the setup cost per order, and H is the holding cost per unit per year.
Given that DiskSan's monthly demand is 10,000 units, the calculation must first convert this to a yearly demand (D = 120,000 units/year). The setup costs (S) are $5, and the holding cost (H) is calculated as 10% of the cost per transistor per month, translating to 120% per year of $5, which is $6 per unit per year.
Plugging these values into the formula gives us: \(EOQ = \sqrt{\frac{2 \cdot 120,000 \cdot 5}{6}} = \sqrt{1,000,000} = 1,000 \). Therefore, the Economic Order Quantity for DiskSan is 1,000 units.
After she was promoted to a high-level executive position in the large company for which she worked, Jorana developed more pro-business political attitudes. This best illustrates the impact of ________ on attitudes.
A)deindividuation
B)social facilitation
C)role-playing
D)mirror-image perceptions
E)the bystander effect
Answer: Role playing
Explanation: Role playing is a situation where an individual changes his/her original character to match a certain behavior either intentionally or not.
In the question Jorana is trying to switch from her original behavior to the behavior required of her new official position.
Greensaver Corp. is a company that sells electricity. Greensaver has taken the initiative to generate more power from solar and wind sources and is planting saplings in parks and on roadsides to combat the polluting effects of nonrenewable resources.
Which of the following best describes Greensaver Corp.'s efforts?
a.Sustainability
b.Corporate philanthropy
c.Corporate social responsibility (CSR)
d.Socially responsible investing (SRI)
Answer:
c.Corporate social responsibility (CSR)
Explanation:
Based on the information provided within the question it can be said that Greensaver Corp's efforts are best described as Corporate social responsibility. This refers to the act of a company' charitable nature to contribute to societal goals. Which is exactly what Greensaver Corp is doing by installing saplings in parks and roadsides in order to combat pollution of nonrenewable resources for the good of the planet and society.
Shelby and her sister Isa want to go into business together selling beauty products. They have agreed to share the risks and profits associated with their new business endeavor, what type of business ownership should they set up?
Answer:
They decided to set up a partnership.
Explanation:
Two persons agreeing to share the risks and profits of their business
Answer:
Shelby and Isa should form a general partnership. Some of the advantages of general partnerships are:
partnerships are easy to form and don't require a lot of paperworkpartnerships have simple structures, usually the partners participate in the business activities of the partnershipthe partnership's profits and losses are passed to the partners (no double taxation)partnerships can be easily dissolvedAlthough the largest disadvantage of general partnerships is unlimited liability, every partner is liable for all of the partnership's debts and obligations.
Explanation:
Sarah, a manager at a consulting firm, has been keenly analyzing the performance of a new recruit, Tom, who turns out to be extremely intelligent. Given Tom's performance and intelligence, Sarah concludes that he will be a good manager in the future even though his interpersonal skills are not half as impressive. This conclusion on Sarah's part seems to be the result of ________.
Answer:
the halo effect.
Explanation:
Based on the information provided within the question it can be said that this conclusion on Sarah's part seems to be the result of the halo effect. This effect refers to the situation in which an individuals positive impression on another person or company positively affects that person/company's feelings in other aspects of the individual in question. Which is exactly what happened in this scenario as Sarah was impressed with his performance and intelligence which made up for his lack of interpersonal skills.
Bunyan Heavy Equipment, a U.S. firm, is investigating expanding into Russia using a greenfield venture. The committee researching this project has delivered a negative report. The main concern of the committee is probably
a. loss of intellectual property due to Russian piracy.b. the fluctuation in the value of the ruble.c. the numerous and conflicting legal authorities in Russia.d. Russia's recent actions to gain state control of private firms' assets.
Answer:
All of these are valid concerns and very relevant indeed, but the most problematic situation would be:
D) Russia's recent actions to gain state control of private firms' assets.
Explanation:
Russia is perceived as a very corrupt state, I don't live in Russia so I can't be 100% sure. Russian leaders are famous for being multi-billionaires that used to be communists, sounds weird.
The problem with Russia is that when their leaders want a private company they just take it away from its rightful owner and many times when the rightful owners complain they are sent to prison and beaten up to death. This may sound crazy but it happened several times including Russia's largest private company Yukos in 2003. Its owner whose last name is Jodorkovski was sent to prison for about 10 years, and its CFO was beaten to death while being held in a Siberian prison.
At the end of a company's first year of operations, 2,000 units of inventory are on hand. Variable costs are $100 per unit and fixed manufacturing costs are $30 per unit. The use of absorption costing, rather than variable costing, would result in a higher net income of what amount?
Answer:
absorption income higher by $60000
Explanation:
given data
inventory on hand = 2,000 units
Variable costs = $100 per unit
fixed manufacturing costs = $30 per unit
to find out
higher net income of what amount
solution
we know that Absorption cost and variable cost are different in their treatment of the fixed manufacturing costing
so we use of absorption cost that carry over in fix cost into ending inventory is here
absorption cost that carry over = fixed manufacturing costs × inventory on hand
absorption cost that carry over = $30 × 2000
absorption cost that carry over = $60000
so that here this amount is use for variable costing and absorption income higher by $60000
Gold Coast Health System just paid an annual dividend of $1.50, which is expected to grow at a constant rate of 5 percent per year. If the current required rate of return is 15 percent, what is the value of Gold Coast’s stock?
A) $15.75
B) $15.50
C) $15.25
D) $15.00
E) $14.75
Answer: Po = Do(1+g )/ke-g
Po = $1.50(1+0.05)/0.15-0.05
Po = $1.50(1.05)/0.10
Po = $1.575/0.10
Po = $ 15.75
The correct answer is A
Explanation: In this question, there is need to calculate the value of the company's stock on the ground that dividend has been paid. The value of the stock is a function of current divided paid, growth rate and the required rate of return on the stock.
Howard Co. had the following first-year amounts for a $7,000,000 construction contract: Actual costs $2,000,000 Estimated costs to complete 6,000,000 Progress billings 1,800,000 Cash collected 1,500,000 What amount should Howard recognize as gross profit (loss) using the percentage-of-completion method?
a. ($1,000,000)b. ($200,000)c. $800,000d. $1,750,000
Answer:
estimated loss from the project is $1,000,000
correct option is a. ($1,000,000)
Explanation:
given data
contract price = $7,000,000
Actual costs = $2,000,000
Estimated costs = 6,000,000
Progress billings = 1,800,000
Cash collected = 1,500,000
to find out
What amount should Howard recognize as gross profit (loss)
solution
we get in the amount to complete the project that is
amount to complete = contract price - Actual costs - Estimated costs
amount to complete = $7,000,000 - $2,000,000 - 6,000,000
amount to complete = - $1000000
so estimated loss on project
so that the total $1,000,000 loss must be recognize
so correct option is a. ($1,000,000)
Final answer:
To determine gross profit (loss) when using the percentage-of-completion method, the formula [(Actual costs - Estimated costs to complete) / Total Estimated costs] x Profit Earned so far is applied. By calculating the values provided in the question, the correct answer is $250,000.
Explanation:
Gross profit (loss) = [(Actual costs - Estimated costs to complete) / Total Estimated costs] x Profit Earned so far
Given:
Actual costs = $2,000,000
Estimated costs to complete = $6,000,000
Progress billings = $1,800,000
Cash collected = $1,500,000
Substitute the values into the formula to calculate:
Gross profit (loss) = [($2,000,000 - $6,000,000) / $6,000,000] x $1,500,000 = ($4,000,000 / $6,000,000) x $1,500,000 = $1,000,000 x 0.25 = $250,000
The correct answer is $250,000.
Sunland Company purchases a new delivery truck for $56100. The sales taxes are $4500. The logo of the company is painted on the side of the truck for $1200. The truck license is $180. The truck undergoes safety testing for $280. What does Sunland record as the cost of the new truck?
Answer:
$62,080
Explanation:
The computation of the cost of the new truck is shown below:
Cost of the new truck = Purchase Price of delivery truck + sales taxes + logo painting cost + safety testing costs
= $561,00 + $4,500 + $1,200 + $280
= $62,080
The truck license is a yearly cost so it would not be included while computing the cost of the new truck. Hence, ignored it
A factory uses 625 tons of steel per year to make reinforced rods. Its ordering costs are $40 per order, and its holding costs are $5 per ton. According to the economic order quantity (EOQ) model, approximately how often does the company have to place an order to maintain optimal order quantity?
Answer:
The company has to place an order approximately once every 59 days to maintain optimal order quantity.
Explanation:
Please find below for the explanations and calculations:
EOQ = square root of [(2* Order Cost per one order * annual demand) / Holding Cost per bracket per year ] = square root of [ (2*40*625)/5] = 100 tons.
Orders made annually give EOQ = Annual demand / EOQ = 625 / 100 = 6.25 orders
Assuming a factor working for 365 days per year, the frequency of the orders made is 365/6.25 days or 59 days.
When Kimberly begins working for Pharmco Industries the company tells her that at a future after so many years of employment with the company she can receive retirement pay. Her rights to receive pay upon retirement would be considereda. vested.b. accrued.c. sheltered.d. inferred.
Answer:
The correct answer is a. vested.
Explanation:
Retirement is the administrative act by which an active worker, whether self-employed or employed, goes into a passive or inactive situation, after reaching the maximum age, or due to serious chronic illness or disability. He then obtains a monetary benefit for the rest of his life. The labor legislation of each country stipulates different conditions in this regard.
In order to compensate for the loss of income that derives from the work termination, the beneficiary of the retirement is recognized an economic benefit that usually consists of a monthly income. The benefit is for life and only ends with the death of the interested party. The amount of the benefit can be based on different criteria: for example, with the actuarial criteria, it is established in relation to the amount and amount of the contributions made; with a substitution criterion, it is established from a certain percentage of the amount of income during working life.
In public retirement systems, to access a retirement it is necessary to meet age requirements (generally around 60-65 years) or access an early retirement for reasons of disability. On the other hand, in the case of a contributory system, access usually depends on having fulfilled a minimum of years of social security contributions.
Steve and Grace know that their nephew loves to travel. Steve and Grace find a great deal on a timeshare and tell Mike they are negotiating to buy the timeshare to give to Mike as a wedding gift. Steve and Grace continue to negotiate with Bob, the timeshare owner, for the purchase of the timeshare. If there is any dispute with the negotiations or a resulting contract, does Mike have any rights in that case
Answer:
Explanation:
That depens of the red tape, if there is one, Mike can claim rigths over the good depending on the negotiation, but if there is no a signed deal it is impossible to claim according to the law.
Final answer:
Explaining Mike's potential rights in a timeshare dispute arising from a gift promise.
Explanation:
Mike would have rights in case of a dispute arising from the negotiations or resulting contract if Steve and Grace intended to give the timeshare to Mike as a wedding gift. This intention could create a legal interest or expectation for Mike in the transaction, granting him standing to pursue legal action if necessary.
Additionally, if Mike can demonstrate that he had a legitimate expectation or reliance on receiving the timeshare as a gift, he may have rights under promissory estoppel or constructive trust theories, depending on the jurisdiction and specific circumstances of the case.
In some legal systems, such as the United States, courts may consider the concept of a 'gift promise' in situations like this, where a promise of a gift can be legally enforceable if certain conditions are met.