Answer:
C) a debit to Merchandise Inventory and a credit to Accounts Payable
Explanation:
The journal entry to record the purchase of inventory on account by using the perpetual inventory system is shown below:
Merchandise Inventory A/c Dr XXXXX
To Accounts Payable A/c XXXXX
(Being merchandise is purchase on credit)
Simply we debited the merchandise inventory account and credited the account payable account so that the correct posting can be done.
One year ago, Norbert Wagner purchased 30 shares of DUX Inc., stock for $20 per share. During the last year, DUX Inc., experienced strong earnings and paid dividends of $0.50 per share. Norbert just sold the stock for $19 per share.Ignoring taxes, Norbert’s return from investing in DUX Inc., was"A. 7.50%B. -2.50%C. -5.00%D. 7.89%
Answer:
option (B) -2.50%
Explanation:
Data provided in the question:
Number is shares purchased = 30
Purchasing price = $20 per share
Dividend paid = $0.50 per share
Selling price of the shares = $19 per share
Now,
Total investment = 30 × $20
= $600
Total sales value = 30 × $19
= $570
Total dividend Received = 30 × $0.50
= $15
Thus,
Rate of Return from Investment
= [ { Sales - Investment + Dividend Received} ÷ Purchase Price] × 100%
= [ { $570 - $600 + $15 } ÷ $600] × 100 %
= [ -$15 ÷ $600 ] × 100 %
= - 2.50%
Hence,
The correct answer is option (B) -2.50%
Which of the following statements is true regarding today's marketing communications?
A) More marketers are shifting away from narrowly defined micromarkets and moving toward
mass marketing.
B) More customers have started relying on marketer-supplied information rather than finding
out information on their own.
C) Network television, magazines, newspapers, and other traditional mass media continue to
increase their dominance.
D) Focused marketing programs, which are designed to build closer relationships with
customers in more narrowly defined micromarkets, are no longer used by marketers.
E) Today's consumers are better informed about products and services.
Answer:
Letter E is correct. Today's consumers are better informed about products and services.
Explanation:
We live in the information age, this means that today's marketing communication is much more direct and accurate. Information is easily disseminated through all easily accessible channels: internet, television, newspapers and magazines, so access to knowledge increases the participation of individuals, who now have much more power to modify their relationship with companies, brands and Marketplace.
The new consumer is much more aware of what they buy, so their demands for quality products and services are growing, they also have the power to actively influence companies, making them act transparently and adopt processes that contribute to the process. development of society in general.
Therefore, business marketing mix should be geared to new consumption patterns and requirements, knowing your actual target audience and anticipating their needs.
Consumers today are better informed about products and services due to the improvement of technology and globalization.
Explanation:The true statement regarding today's marketing communications is: E) Today's consumers are better informed about products and services. In recent decades, with the improvement of technology and globalization, consumers can access information about products and services from all over the world. The development of the internet has allowed consumers to be better informed, as they can compare prices, read reviews, and gather information before making a purchasing decision.
For example, consumers can search for information about a product, read customer reviews on websites, watch demonstration videos on social media platforms, and participate in online forums to learn more about the products and services they are interested in. This access to information empowers consumers and enables them to make informed choices.
McCoy paid a one-time special dividend of $3.40 on October 18, 2010. Suppose you bought
McCoy stock for $47.00 on July 18, 2010, and sold it immediately after the dividend was paid for
$63.52 . What was your realized return from holding McCoy?
A) 4.24%
B) 6.36%
C) 33.91%
D) 42.38%
Answer:
option (D) 42.38%
Explanation:
Data provided in the question:
Dividend paid = $3.40
Purchase price of stock = $47.00
Selling price = $63.52
Now,
Realized Return
= [ Selling price - Purchase Price + dividend ] ÷ Purchase Price
= [ $63.52 - $47.00 + $3.40 ] ÷ $47.00
= [ $16.52 + $3.40 ] ÷ $47.00
= $19.92 ÷ $47
= 0.4238
or
= 0.4238 × 100%
= 42.38%
Hence,
The correct answer is option (D) 42.38%
Suppose that demand for a product is Q = 1200 − 4P and supply is Q = −240 + 2P. Furthermore, suppose that the marginal external damage of this product is $12 per unit. How many more units of this product will the free market produce than is socially optimal? Calculate the deadweight loss associated with the externality.
Answer: 16 units more than social optimum.
DWL = dead weight loss = (1/2)*(Q* - Q°) 12 =96
Explanation:
Q=1200 - 4P and Q=-240 + 2P
In a free market quantity demand =quantity supplied
1200 -4P = -240 +2P
P =240
Sub P
Q* = 240
Socially optimal quantity is
Marginal social benefit (MSC)= marginal social cost(MSC), including external damage =MEC
MPC= marginal private cost =inverse of supply function
MPC = (1/2)*Q + 120
MEC=12
MSC =(MPC +MEC) = (1/2)Q +120 +12
MSC= MPB where MPB is marginal private benefit = inverse of demand functn
MPB = 300 -(1/4)Q
(1/2)Q + 132 =300 - (1/4)Q
Q° = 224
Difference btw Q* & Q° = 16 units more than social optimum.
DWL = dead weight loss = (1/2)*(Q* - Q°) 12 =96
The original market equilibrium occurs at a quantity of 440 and a price of $15. However, when considering an external damage cost of $12 per unit, the supply curve shifts upwards leading to a new equilibrium at a price of $30 and quantity of 410. Thus, the market would produce 30 more units than is socially optimal, creating a deadweight loss.
Explanation:In this case, the demand for a product is represented by Q = 1200 − 4P and the supply by Q = −240 + 2P. The original equilibrium (before considering the external social costs of production) is found where the private supply curve intersects the demand curve. In this example, the original equilibrium occurs at a price of $15 and a quantity of 440.
When the marginal external damage of $12 per unit (possibly due to environmental impacts) is considered, the costs of production go up. Consequently, the supply curve shifts upwards, resulting in a new equilibrium at a higher price ($30) but lower quantity (410). The difference in quantities (440-410 = 30 units) represents the additional units that the free market would produce compared to the socially optimal level.
To calculate the deadweight loss associated with the externality, you would look at the discrepancy between the total costs and benefits to society and the private costs and benefits. Given the information provided, a specific calculation cannot be made, but the deadweight loss would be represented by the triangular area on a supply and demand graph that encompasses the quantity difference between the socially optimal level and the free market level.
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Alpha partnership has 8 partners who have entered into a binding buy/sell agreement that requires any surviving partners to purchase the partnership interest of any partner to die. The partnership uses an entity approach to fund this arrangement. How many policies are required to satisfy this arrangement? (a) 1. (b) 8. (c) 16. (d) 64.
Answer:
total number of policies = 64
so correct option is (d) 64
Explanation:
given data
partnership = 8 partners
to find out
How many policies are required
solution
we know that every partner required a policy for each and every other partner
so here we can say number of policies will be
number of policies = 8 × 7
number of policies = 56 Policies
and
here firm also hold a policy for each partner i.e here 8
so here total number of policies will be
total number of policies = 56 + 8
total number of policies = 64
so correct option is (d) 64
In an entity approach to a buy/sell agreement with 8 partners, the partnership would purchase one life insurance policy for each partner, making a total of 8 policies required.
Explanation:The Alpha partnership, which consists of 8 partners, has a buy/sell agreement that stipulates the surviving partners purchase the partnership interest of any deceased partner. In the context of an entity approach, this would mean the partnership itself purchases life insurance policies on each partner. Since the entity approach means the partnership is the owner and beneficiary of the policies, only one policy per partner is needed. Therefore, for 8 partners, a total of 8 policies are required to be fully funded for the agreement.
Net present value:
1. is the best method of analyzing mutually exclusive projects.2. is less useful than the internal rate of return when comparing different sized projects.3. is the easiest method of evaluation for non-financial managers to use.4. is less useful than the profitability index when comparing mutually exclusive projects.5. is very similar in its methodology to the average accounting return.
Answer:
Explanation:
(A) Correct√
NPV is the best method of analyzing mutually exclusive projects. Mutually exclusive projects are projects from which one - the most valuable/profitable - is chosen. Net present value takes into consideration, the difference between the present and the future value of a current investment plan or project. For projects which can rightly replace one another (mutually exclusive projects), the best method of analyzing their value/return/profitability is the Net Present Value.
(B)
NPV is not less useful than IRR when comparing different sized projects
(C) Correct√
Net Present Value can be said to be the easiest method of project evaluation for nonfinancial managers because it is easy to understand and to calculate. The net present cash inflow and cash outflow, the discount rate, and the time are computed in the net present value.
(D)
NPV is not less useful than Profitability Index when comparing mutually exclusive projects
(E)
Net Present Value is similar but not VERY similar in methodology, to the AAR. The similarity is not deep because Average Accounting Return does not take into consideration, the time value of money!
The average annual return over the period 1926-2009 for small stocks is 21.2%, and the standard
deviation of returns is 21.2%. Based on these numbers, what is a 95% confidence interval for
2010 returns?
A) -10.6%, 31.8%
B) 0%, 42.4%
C) -21.2%, 42.4%
D) -21.2%, 63.6%
Answer:
The 95% confidence interval is between -21.2% and 63.6% (option D).
Explanation:
Hi, the empirical rule dictates that 95% of the data is found within +/- 2 standard deviations from the mean, therefore our interval can be found doing the following calculations.
[tex]L.Limit=Mean-2(S.D)[/tex]
That is:
[tex]L.Limit=0.212-2(0.212)=-0.212[/tex]
Now, the higher limit.
[tex]H.Limit=Mean+2(S.D)[/tex]
[tex]H.Limit=0.212+2*(0.212)=0.636[/tex]
So, the answer is D) -21.2%, 63.6%
Best of luck.
PackMan Corporation has semiannual bonds outstanding with nine years to maturity and the bonds are currently priced at $754.08. If the bonds have a coupon rate of 7.25 percent, what is the after-tax cost of debt for PackMan if its marginal tax rate is 30 percent.
Answer:
8.23%
Explanation:
Since this bond pays semi-annual coupons, it means that the payments occur every 6 months; making it 2 periods per year. Using a Financial calculator; enter the following inputs. If using TI BA II plus, key in the number first, then the function.
Total duration; N = 9*2 = 18
Face Value ; FV = 1,000 (use 1,000 if the value is not given)
Present value or price ; PV = -754.08
Semiannual Coupon Payment; PMT = Semiannual coupon rate *Face value
Semiannual Coupon Payment; PMT = (7.25%/2) *1000 = 36.25
The Yield to maturity;YTM is the annual pretax I/Y which is the Pretax cost of debt in this case
therefore, CPT I/Y = 5.875% (note: semi-annual rate)
Next, convert the semiannual rate to annual rate i.e the YTM;
= 5.875%*2
Pretax cost of debt (YTM) = 11.75%
Aftertax cost of debt = Pretax cost of debt (1-tax)
= 0.1175% (1-0.30)
= 0.08225 or 8.23%
Suppose Alyssa comes into a large sum of money and decides to lend it out to earn interest on it. Because she lacks the expertise to evaluate the credit risks of potential borrowers. she decides to deposit the money in her local bank, a financial intermediary. This is an example of how financial intermediaries can help solve the problem of:
Final answer:
Banks act as financial intermediaries by pooling funds from savers and lending them to creditworthy borrowers, thus solving the problem of credit risk assessment for individual savers.
Explanation:
Banks act as financial intermediaries by accepting deposits from savers and lending those funds to borrowers. In the case of Alyssa, depositing her money in a local bank allows her to earn interest on her savings while avoiding the need to evaluate the credit risks of potential borrowers.
Financial intermediaries like banks help solve the problem of credit risk assessment for individual savers. By pooling funds from multiple savers, banks can diversify their lending portfolios and evaluate the creditworthiness of borrowers on behalf of the savers. This reduces the risks associated with lending money directly to individual borrowers.
By depositing her money in the bank, Alyssa can earn interest on her savings while having the assurance that her funds are being lent to creditworthy borrowers.
If Smart Company issues 1,000 shares of $5 par value common stock for $90,000, the account
a. Cash will be debited for $95,000.
b. Common Stock will be credited for $90,000.
c. Paid-in Capital in Excess of Par Value will be credited for $85,000.
d. Paid-in Capital in Excess of Par Value will be credited for $5,000.
Wave Corporation began the current year with a retained earnings balance of $25,000. During the year, the company corrected an error made in the prior year, which was a failure to record depreciation expense of $5,000 on equipment. Also, during the current year the company earned net income of $15,000 and declared cash dividends of $5,000. Compute the year-end retained earnings balance.
a. $40,000.
b. $30,000.
c. $39,000.
d. $35,000.
Which of the following statements is not true about a 4-for-1 split?
a. A stockholder with ten shares before the split owns forty shares after the split.
b. Par value per share is reduced to one-fourth of what it was before the split.
c. The market price will probably decrease.
d. Total contributed capital increases.
The answer for the first question is b. Common Stock will be credited for $90,000. The answer for the second question is d. $35,000. The answer for the third question is a. A stockholder with ten shares before the split owns forty shares after the split.
The correct answer for the first question is b. Common Stock will be credited for $90,000. When Smart Company issues shares of common stock, the cash received is credited to the Common Stock account at the par value of the shares. In this case, the par value is $5 per share, and the company issued 1,000 shares, resulting in a credit of $90,000 to the Common Stock account.
The correct answer for the second question is d. $35,000. To calculate the year-end retained earnings balance, you start with the beginning balance of $25,000 and add the net income of $15,000. Then, you subtract the dividends of $5,000 and the depreciation expense correction of $5,000. The resulting balance is $35,000.
The correct answer for the third question is a. A stockholder with ten shares before the split owns forty shares after the split. In a 4-for-1 split, each share is split into four shares, resulting in a total of four times the previous number of shares. Therefore, a stockholder with ten shares before the split would own forty shares after the split.
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The correct answers for the multiple choice questions are: a. Cash will be debited for $95,000, c. $39,000, and d. Total contributed capital increases.
Explanation:a. Common Stock will be credited for $90,000.
When Smart Company issues 1,000 shares of $5 par value common stock for $90,000, the common stock account will be credited for the par value of the shares, which is $90,000. The cash account will be debited for the same amount, $90,000, as the company received cash for the stock issuance. The additional amount received above the par value, which is $85,000 ($90,000 - $5,000), will be credited to the Paid-in Capital in Excess of Par Value account.
c. $39,000.
To compute the year-end retained earnings balance, we start with the beginning balance of $25,000. Then we add the net income of $15,000 and the correction for the prior year's error of $5,000. Finally, we subtract the cash dividends declared of $5,000. So, $25,000 + $15,000 + $5,000 - $5,000 = $40,000.
c. The market price will probably decrease.
In a 4-for-1 stock split, the number of shares a stockholder owns increases, but the total value of their shares remains the same. The par value per share decreases, but the market price is expected to adjust accordingly, so the market value of the stock does not change. Total contributed capital remains the same.
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In 2018, Morley, a single taxpayer, had an AGI of $30,000 before considering the following items: Loss from damage to rental property ($6,000) Loss from theft of bonds (3,000) Personal casualty gain 4,000 Personal casualty loss (after $100 floor) (9,000) The personal casualties occurred in a Federally-declared disaster area. Determine the amount of Morley's itemized deduction from the losses.
(A) $2,900
(B) $5,600
(C) $5,120
(D) $0
(E) None of these choices are correct.
Answer:
Option (B) $5,600
Explanation:
AGI before casualties $30,000
rental property loss 6,000
personal casualty gain $4,000
personal casualty loss 4,000
Adjusted gross income $24,000
itemized deductions
casualty loss ($9,000 - $4000) - (10% x $24,000) $2,600
miscellaneous itemized deductions 3,000
Total itemized deductions $5,600
Final answer:
Morley's itemized deduction from the losses, considering only personal casualties, is $5,000 because the personal casualty gain of $4,000 is offset against a personal casualty loss of $9,000, which occurred in a Federally-declared disaster area. Losses on rental properties and theft of personal bonds are treated differently and are not included in this calculation. Thus, none of the provided options match the correct deduction amount. The correct option is e.
Explanation:
To calculate Morley's itemized deduction from the losses, we must look at each loss and gain and apply IRS rules. For personal casualties, we calculate the net loss by first offsetting any gains against the losses. Morley has a personal casualty gain of $4,000 and a personal casualty loss of $9,000 (after applying the $100 floor to the loss).
The net casualty loss is $9,000 (loss) - $4,000 (gain) = $5,000. Since the personal casualties occurred in a Federally-declared disaster area, Morley can deduct the entire net loss of $5,000.
For thefts and casualty losses on property not connected with a trade or business or a transaction entered for profit, such as theft of personal bonds, these are personal losses. Personal losses are not deductible unless they occur in a federally declared disaster area, which is not the case with the stolen bonds.
The loss from damage to rental property, which is an income-producing property, is treated differently, and Morley could potentially deduct this on Schedule E, subject to certain limits and rules, but since this is not specified as part of the personal casualty losses, it may not be included in the personal itemized deduction calculation.
Therefore, based only on the information provided and considering only personal casualty losses, the correct amount of Morley's itemized deduction for the losses is $5,000. Option (E) None of these choices are correct would be the best answer if we are only considering personal casualty itemized deductions.
Waterway Toothpaste Company initiates a defined benefit pension plan for its 50 employees on January 1, 2017. The insurance company which administers the pension plan provided the following selected information for the years 2017, 2018, and 2019.
Col1 Plan Assets (Fair Value $51000 $87300 $183130
Col2 Accumulated benefit obligation 45100 163400 290800
Col3 Projected benefit obligation 61000 203910 323900
Co4 lNet (gain) loss (for purposes of corridor calculation) 0 78700 81518
Col5 Employer’s funding contribution (made at end of year) 51000 61000 105800
There were no balances as of January 1, 2017, when the plan was initiated. The actual and expected return on plan assets was 10% over the 3-year period, but the settlement rate used to discount the company’s pension obligation was 13% in 2017, 11% in 2018, and 8% in 2019. The service cost component of net periodic pension expense amounted to the following: 2017, $61,000; 2018, $87,300; and 2019, $114,700. The average remaining service life per employee is 12 years. No benefits were paid in 2017, $29,800 of benefits were paid in 2018, and $18,700 of benefits were paid in 2019 (all benefits paid at end of year).Calculate the amount of net periodic pension expense that the company would recognize in 2017, 2018, and 2019.Pension Expense for 2017?Pension Expense for 2018?Pension Expense for 2019?Prepare the journal entries to record net periodic pension expense, employer’s funding contribution, and related pension amounts for the years 2017, 2018, and 2019.
Answer
The answer and procedures of the exercise are attached in the following 4 images.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in the following 4 images.
Ben's Border Café is considering a project which will produce sales of $16,000 and increase cash expenses by $10,000. If the project is implemented, taxes will increase from $23,000 to $24,500 and depreciation will increase from $4,000 to $5,500. What is the amount of the operating cash flow using the top-down approach?
Answer:
the amount of the operating cash flow using the top-down approach is $4.500
Explanation:
operating cash flow using the top-down approach
operating cash flow =Sales- increase cash expenses -increase in tax
=16000-10000-(24500-23000)
=$ 4500
Note:increase cash expenses and increase in tax are cash outflow . Depreciation has not been considered as it is a non cash expenditure.
Final answer:
Using the top-down approach, the operating cash flow for Ben's Border Café's project is determined by subtracting cash expenses and the increase in taxes from sales, resulting in an operating cash flow of $4,500. The calculation excludes depreciation, as it does not affect cash.
Explanation:
To calculate the operating cash flow (OCF) using the top-down approach, we start with the sales revenue and then subtract the operating expenses and taxes, but do not consider depreciation since it does not involve a cash outflow. First, we have sales of $16,000. Second, the increase in taxes is from $23,000 to $24,500, thus the increase is $1,500. The calculation is as follows:
Sales: $16,000- Cash expenses: $10,000- Increase in taxes: $1,500Operating cash flow = Sales - Cash expenses - Increase in taxes
Operating cash flow = $16,000 - $10,000 - $1,500 = $4,500.
At the end of 2016, Concord Corporation has accounts receivable of $704,700 and an allowance for doubtful accounts of $26,850. On January 24, 2017, it is learned that the company's receivable from Madonna Inc. is not collectible and therefore management authorizes a write-off of $4,384. 1. Prepare the journal entry to record the write-off. 2. What is the cash realizable value of the accounts receivable before the write off and after the write off?
Answer:
1.
Debit Allowance for doubtful accounts $4,384
Credit Accounts receivable $4,384
2.
The cash realizable value of the accounts receivable:
Before the write off: $677,850
After the write off: $677,850
This is the same value
Explanation:
1. Madonna Inc. authorizes a write-off of uncollectible receivable, the company makes the entry to reduce the balances in the Allowance for Doubtful Account and Acccounts Receivable. The journal entry:
Debit Allowance for doubtful accounts $4,384
Credit Accounts receivable $4,384
2.
Cash realizable = Accounts receivable (balance)- Allowance for doubtful accounts (balance)
Before the write off,
Cash realizable = $704,700 - $26,850 = $677,850
After the write off:
The balance of Accounts receivable = $704,700 - $4,384 = $700,316
The balance of Allowance for doubtful accounts = $26,850 - $4,384=$22,466
Cash realizable = $700,316 - $22,466 = $677,850
Complete the following sentences.
1. establish goals for the company’s sales and production personnel.
2. The is a set of interrelated budgets that constitutes a plan of action for a specified time period.
3. reduces the risk of having unrealistic budgets.
4. include the cash budget and the budgeted balance sheet.
5. The budget is formed within the framework of a .
6. contain considerably less detail than budgets.
Answer
The answer and procedures of the exercise are attached in the following image.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.
The following sentences are completed.
helps align their efforts and focus toward achieving specific targets and objectives.The master budget is a set of interrelated budgets that constitutes a plan of action for a specified time period. The risk of having unrealistic budgets can be decreased through regular reviews of actual performance against the budget and ongoing monitoring.The financial budgets typically include the cash budget, which outlines the expected cash inflows and outflows, and the budgeted balance sheet.The budget is created under the constraints of a budgeting period, which is typically a predetermined time frame like a fiscal year or a particular quarter. Budgets that are extended into future periods and are continuously updated are called rolling budgets or continuous budgets.1. Establishing goals for the company's sales and production personnel helps align their efforts and focus toward achieving specific targets and objectives.
2. The master budget is a set of interrelated budgets that constitutes a plan of action for a specified time period. It typically includes individual budgets for sales, production, operations, marketing, and other relevant departments, all consolidated into a comprehensive plan.
3. The risk of having unrealistic budgets can be decreased through regular reviews of actual performance against the budget and ongoing monitoring. In order to keep the budget realistic and in line with shifting conditions, this enables the required changes and corrective actions to be performed.
4. The financial budgets typically include the cash budget, which outlines the expected cash inflows and outflows, and the budgeted balance sheet, which projects the financial position of the company at a specific point in time based on the budgeted activities and transactions.
5. The budget is created under the constraints of a budgeting period, which is typically a predetermined time frame like a fiscal year or a particular quarter. Planning, carrying out, and assessing the budgeted actions and outcomes have a time frame thanks to the budgeting period.
6. Budgets that are extended into future periods and are continuously updated are called rolling budgets or continuous budgets. The amount of information in these budgets is often far smaller than annual budgets, and they are regularly amended and altered to reflect shifting conditions, providing for greater adaptability and responsiveness in financial planning and control.
Thus, the mentioned above sentences are complete.
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Larry Nelson holds 1,000 shares of General Electric's (GE) common stock. The annual stockholder meeting is being held soon, but as a minor shareholder, Larry doesn't plan to attend. Larry did not sell his shares but gave his voting rights to the management group running General Electric (GE). Larry must have signed a ___________ that gives the management group control over his shares.
A. Poison Pill,
B. Proxy,
C. Preemptive Right,
D. Corporate Charter
Answer:
The correct answer is B that is Proxy.
Explanation:
Proxy voting is the term which is described as the situation where the person holding some shares of the firm, does not sell the shares and gave the voting right to someone on behalf of his or her shareholding.
In this scenario, Larry does not want to sell the shares and gave the voting rights to the management. So, he must signed a proxy which gives the management control over the shares.Answer:
Harriet and Harry Combs (both 37 years old) are married and both want to contribute to a Roth IRA. In 2019, their AGI before any IRA contribution deductions is $50,000. Harriet earned $46,000 and Harry earned $4,000. (Leave no answer blank. Enter zero if applicable.) a. How much can Harriet contribute to her Roth IRA if they file a joint return?
Contribution Roth IRA ?
b. How much can Harriet contribute if she files a separate return?
Contribution Roth IRA ?
c. How much can Harry contribute to his Roth IRA if they file separately?
Contribution Roth IRA ?
Harriet can contribute $6,000 to her Roth IRA if filing jointly, but her contribution may be limited if filing separately. Harry can contribute up to $4,000, his earned income, to his Roth IRA if they file separately and did not live together.
Explanation:The question pertains to the contributions that Harriet and Harry Combs can make to their Roth IRAs under different filing status conditions. Roth IRA contributions are subject to income limits and filing status requirements as determined by the Internal Revenue Service (IRS). For the year 2019, the maximum contribution amount is $6,000 for individuals under 50 years of age.
a. Harriet's Contribution with Joint Return
As Harriet and Harry's combined Adjusted Gross Income (AGI) is $50,000 and they are under the limit for Roth IRA contributions for married couples filing jointly, Harriet can contribute the maximum amount of $6,000 to her Roth IRA.
b. Harriet's Contribution with Separate Return
If Harriet files separately, she may be subject to a lower contribution limit or may not be able to contribute to a Roth IRA at all, as the income threshold for contributing to a Roth IRA is significantly lower for those filing separately. However, specific information for limits in 2019 is necessary to determine the exact contribution amount she is eligible for. When filing separately, if Harriet lives with her spouse at any time during the year and her income is $10,000 or more, she cannot contribute to a Roth IRA.
c. Harry's Contribution with Separate Return
If Harry files separately from Harriet, his contribution limit would also be affected by the same thresholds as Harriet's. Given his income of $4,000, Harry can contribute up to the amount he earned, so he can contribute the full $4,000 to his Roth IRA as long as they did not live together.
If labor productivity growth slows down in a country, this means that the growth rate in ________ has declined.
(A) nominal GDP
(B) the working-age population
(C) the quantity of goods or services that can be produced by one hour of work
(D) labor force participation
Answer:
The answer is letter C
Explanation:
The quantity of goods or services that can be produced by one hour of work
Gonzales Corporation generated free cash flow of $88 million this year. For the next two years,the companyʹs free cash flow is expected to grow at a rate of 10%. After that time, the companyʹsfree cash flow is expected to level off to the industry long-term growth rate of 4% per year. Ifthe weighted average cost of capital is 12% and Gonzales Corporation has cash of $100 million,debt of $300 million, and 100 million shares outstanding, what is Gonzales Corporationʹsexpected terminal enterprise value in year 2?A) $1384.24B) $1245.82C) $1107.39D) $968.97
Answer:
option (A) $1,384.24
Explanation:
Given:
Free Cash Flow in Year 3 = $88 million
Expected growth rate = 10% = 0.1
Constant Growth Rate, gC = 4%
Gonzales Corporationʹsexpected terminal enterprise value in Year 2
= [tex]\frac{\textup{FCF3}}{\textup{(WACC - gC)}}[/tex]
= [tex]\frac{FCF0\times(1+gH)^2\times(1+gC)}{\textup{(WACC - gC)}}[/tex]
Here,
FCF3 is the Free Cash Flow in Year 3
FCF3 is Free Cash Flow Now
= [tex]\frac{\textup{88\times(1 + 0.10)^2\times(1 + 0.04)}}{\textup{(0.12 - 0.04)}}[/tex]
= $1,384.24
Hence,
The correct answer is option (A) $1,384.24
On January 1, Year 3, Boxwood, Inc. issues 1,000 shares of $1 par value common stock for $30 per share. Later that year, the company issues 1,000 shares of $10 par value preferred stock for $80 per share. The company’s balance sheet as of December 31, Year 3, will show total paid-in capital of:
Answer:
total paid-in capital = $110,000
Explanation:
When investors or shareholders pay a lump sum money to a company to get the stock of the that company, it is called paid-in capital.
Here, the par value = $1, therefore, additional capital per stock = $30 - $1 = $29
For preferred stock,
Par value = $10, and additional paid-in capital per stock = $(80 - 10) = $70.
See images to get the explanation:
Suppose an investment will have an initial positive cash flow of $100,000 in year 0, followed by a negative cash flow of $110,000 in period 1. Thus, the IRR of the project is 10%. Should we accept or reject the project if the required return is 15%?
Answer: Reject the Project
Explanation:
If the required return (also known as hurdle rate) is 15% (which is above the Internal Rate of Return of 10%) then the project or investment is less profitable.
The required return is the minimum return that will repay initial investment and other input.
Since the actual or eventual rate of return (IRR) is less than this required minimum, the project should be rejected.
On the other hand, if the investor has no alternative project to invest in or if the investor no time constraints, he or she can wait to see the Internal Rate of Return in succeeding periods or years like Period 2, Period 3, etcetera.
5. To advertise or not to advertise Suppose that Fizzo and Pop Hop are the only two firms that sell orange soda. The following payoff matrix shows the profit (in millions of dollars) each company will earn depending on whether or not it advertises: Pop Hop Advertise Doesn't Advertise Fizzo Advertise 8, 8 12, 4 Doesn't Advertise 4, 12 10, 10 For example, the upper right cell shows that if Fizzo advertises and Pop Hop doesn't advertise, Fizzo will make a profit of $12 million, and Pop Hop will make a profit of $4 million. Assume this is a simultaneous game and that Fizzo and Pop Hop are both profit-maximizing firms. If Fizzo decides to advertise, it will earn a profit ofmillion if Pop Hop advertises and a profit ofmillion if Pop Hop does not advertise. If Fizzo decides not to advertise, it will earn a profit ofmillion if Pop Hop advertises and a profit ofmillion if Pop Hop does not advertise. If Pop Hop advertises, Fizzo makes a higher profit if it chooses . If Pop Hop doesn't advertise, Fizzo makes a higher profit if it chooses . Suppose that both firms start off not advertising. If the firms act independently, what strategies will they end up choosing? Fizzo will choose to advertise and Pop Hop will choose not to advertise. Fizzo will choose not to advertise and Pop Hop will choose to advertise. Both firms will choose not to advertise. Both firms will choose to advertise.
Agawa Corporation is preparing its cash payments budget for next month, May. The following information pertains to the cash payments: Agawa Corporation is preparing its cash payments budget for next month, May. The following information pertains to the cash payments:a. Agawa pays for 55% of its direct materials purchases in the month of purchase and the remainder the following month. April's direct material purchases were $83,500, while the company anticipates $88,000 of direct material purchases in May.b. Direct labor for May is budgeted to be $30,500 and will be paid at the end of that month.c. Manufacturing overhead is estimated to be 140% of direct labor cost each month. All but $11,000 of these costs are paid in the month in which they are incurred.d. Monthly operating expenses for May are expected to be $44,150. All but $3,400 of these operating expenses are paid during the month in which they are incurred.e. Agawa Corporation will be making an estimated tax payment of $7,300 in May.Required:How much cash will be paid out in May?
Answer
The answer and procedures of the exercise are attached in a microsoft excel document.
Explanation
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.
Consider the following information for a fictional firm. The change in profit is MR – MC, the difference one more unit sold makes to total profit.
Quantity produced (units)Change in profit (dollars)
3,000$3
5,000$0
7,000$1
The firm should produce_________ units, because that is the quantity of production where ___________ which maximizes _______________.
Complete the sentence with the following words:
a. 5000
b. 7000
c. 3000
d. market share
e. profit
f. marginal revenue is greater than marginal cost
g. marginal revenue is less than marginal cost
h. marginal revenue is equal marginal cost
Answer:
a. 5000
Explanation:
Please see attachment .
The firm should produce 5000 units to maximize profit, as this is the point where marginal revenue equals marginal cost.
The firm should produce 5000 units, because that is the quantity of production where marginal revenue is equal to marginal cost which maximizes profit. From the given information, producing 3000 units yields a change in profit of 3 (MR > MC), indicating potential for increased production. At 5000 units, the change in profit is 0, indicating MR = MC, the optimal point for maximizing profit. Producing 7000 units results in a change in profit of 1 (MR < MC), suggesting that production beyond 5000 units reduces profit per additional unit. Therefore, producing 5000 units is the optimal strategy for profit maximization, as it achieves the balance between marginal cost and marginal revenue.
Consider the rate of return of stocks ABC and XYZ.Year rABC rXYZ1 20% 30%2 12 123 14 184 3 05 1 −10a. Calculate the arithmetic average return on these stocks over the sample period.b. Which stock has greater dispersion around the mean return?c. Calculate the geometric average returns of each stock. What do you conclude?d. If you were equally likely to earn a return of 20%, 12%, 14%, 3%, or 1% in each year (these are the five annual returns for stock ABC), what would be your expected rate of return?e. What if the five possible outcomes were those of stock XYZ?f. Given your answers to parts (d) and (e), which measure of average return, arithmetic or geometric, appears more useful for predicting future performance?
Answer:
Please see attachment
Explanation:
Please see attachment
Beta Cleaning Equipment Corp. has started the actual design and development of a new floor buffing machine. It has the details of manufacturing, marketing, and operations of the new product as well. According to the stage-gate process, what is the next stage of this project?
(A) Formation of a focus group to make sure the product meets user expectations
(B) Development of a business case to justify the project
(C) Launch of the product by producing it commercially and selling it
(D) Verification and validation of the new product and its marketing and production
Answer:
Letter A is correct. Formation of a focus group to make sure the products meets user expectations.
Explanation:
Using a focus group is an essential tool for an organization developing a new product that needs market research. The focus group is made up of a group of participants who come together for the purpose of analyzing a product or service marketing campaign and providing feedback on it.
There is a moderator responsible for listing questions about what is being reviewed, and ensuring that everyone contributes ideas and opinions. Companies typically use a variety of focus groups in different locations to ensure diversification of demographics, consumer behavior, purchasing history, and other relevant variables.
The biggest benefits seen from the focus group are: digital marketing tactics and rebranding.
Final answer:
After Beta Cleaning Equipment Corp. has designed and developed a new floor buffing machine, the next stage in the stage-gate process is the verification and validation of the product, which includes extensive testing and refinement.
Explanation:
The stage-gate process in product development involves several key steps that lead from the initial concept to the final launch of the product. Once Beta Cleaning Equipment Corp. has completed the actual design and development of a new floor buffing machine, including manufacturing, marketing, and operations details, the next stage in the stage-gate process would typically involve d. verification and validation of the product alongside its marketing and production strategies.
At this point, the new design should undergo thorough testing to identify any weaknesses or potential improvements, and to ensure it meets user expectations and adheres to market standards before proceeding to commercial launch.
You just gave an in-depth presentation on the company’s new marketing programs, intended for the specialists in the marketing department. The marketing manager then asked you to give a shorter version of the presentation to the company’s top executives. Generally speaking, how should you modify the scope of your presentation for this new audience?
When modifying the scope of the presentation for top executives, it's essential to focus on key strategic elements and high-level insights while condensing detailed information. Here are some general guidelines:
1. Executive Summary:
- Provide a concise executive summary upfront, highlighting the main objectives, key strategies, and expected outcomes.
2. Key Metrics and Results:
- Emphasize high-level metrics and results that directly impact the company's bottom line.
- Highlight key performance indicators (KPIs) relevant to overall business goals.
3. Strategic Impact:
- Clearly articulate how the marketing programs align with the company's broader strategic initiatives.
- Emphasize the impact on revenue growth, market share, and long-term business objectives.
4. Simplified Graphics:
- Use visually compelling charts and graphs to present complex data in a simplified manner.
- Focus on visuals that convey the most critical information for executive decision-making.
5. Time Efficiency:
- Keep the presentation concise and respect the executives' time. Aim for brevity while conveying essential information.
6. Risk and Mitigation:
- Address any potential risks associated with the marketing programs and present proactive mitigation strategies.
7. Opportunities and Innovation:
- Highlight innovative aspects of the marketing programs that contribute to the company's competitive edge and market positioning.
8. Question Anticipation:
- Anticipate and be prepared to address high-level questions that executives are likely to ask, demonstrating a thorough understanding of the business impact.
By adapting the presentation to focus on strategic, high-impact elements and presenting information in a streamlined and accessible manner, you can effectively communicate the value of the marketing programs to top executives who may be more concerned with overarching business outcomes.
Focus on key points, strategic impact, financial metrics, summarized data, time efficiency, risks and mitigations, and actionable recommendations.
When modifying the scope of your presentation for the company's top executives, consider the following adjustments:
1. Focus on Key Points: Highlight the main objectives, strategies, and expected outcomes of the new marketing programs. Avoid detailed explanations and technical jargon.
2. Emphasize Strategic Impact: Discuss how the marketing programs align with the company's overall goals and strategy. Show the potential impact on revenue, market share, and competitive positioning.
3. Include Financial Metrics: Provide clear and concise financial projections, such as ROI, cost-benefit analysis, and expected profit margins. Executives are keen on understanding the financial implications.
4. Summarize Data: Use high-level summaries and key takeaways instead of in-depth data analysis. Present charts and graphs that visually convey the most important information.
5. Time Efficiency: Keep the presentation brief and to the point. Executives have limited time and appreciate concise presentations that respect their schedules.
6. Address Risks and Mitigations: Outline potential risks and the measures in place to mitigate them. This demonstrates foresight and preparedness.
7. Actionable Recommendations: Conclude with clear, actionable recommendations or decisions that need to be made by the executives.
By focusing on these elements, you tailor your presentation to address the interests and priorities of the top executives, ensuring it is relevant and impactful.
The materials manager for a billiard ball maker must periodically place orders for resin, one of the raw materials used in producing billiard balls. She knows that manufacturing uses resin at a rate of 50 kilograms each day, and that it costs $.04 per day to carry a kilogram of resin in inventory. She also knows that the order costs for resin are $100 per order, and that the lead time for delivery is four days. If order size was 1,000 kilograms of resin, what would be the length of an order cycle?
A. 0.05 daysB. 4 daysC. 16 daysD. 20 daysE. 50 days
Answer:
D. 20 days
Explanation:
Daily usage rate: 50 kg each day
Order size: 1,000 kg
lead time: 4 days
Since the question just wants to know the length of an order cycle, all of the monetary information can be disregarded.
The company must maintain a stock, at the time of order, big enough to supply production during the lead time. Minimum stock should be:
[tex]Min = 50\frac{kg}{day} * 4\ days\\Min = 200 \ kg[/tex]
Therefore, the company must reorder when stock reaches 200 kg. The length of the order cycle is the number of days for the company to reach minimum stock added to the order lead time:
[tex]C = \frac{1000 - 200}{50} +4\ days\\C= 20\ days[/tex]
You own 400 shares of Western Feed Mills stock valued at $51.20 per share. What is the dividend yield if your annual dividend income is $352? A. 1.68 percent B. 1.72 percent C. 1.83 percent D. 1.13 percent E. 1.21 percent
Answer:
option (B) 1.72%
Explanation:
Data provided in the question:
Number of shares owned = 400
Per share market value = $51.20
Market Value of stocks purchased = 400 × $51.20 = $20,480
Dividend income = $352
Now,
Dividend Yield = [ Dividend ÷ Market Value of share ] × 100%
= [ $352 ÷ $20,480 ] × 100%
= 0.0172 × 100%
= 1.72%
Hence,
The correct answer is option (B) 1.72%
On December 31, Sulfur Corporation has the following data available: Net Income $ 170 comma 000 Interest expense 30 comma 000 Total assets at the beginning of the year 770 comma 000 Total assets at the end of the year 900 comma 000 Total common stockholders' equity at the beginning of the year 410 comma 000 Total common stockholders' equity at the end of the year 290 comma 000
What is return on equity? (Round your final answer to two decimal places, X.XX%.)
Answer:
40%
Explanation:
The computation of the return on equity is shown below:
= (Net income - interest expense) ÷ (weightage average of common stockholders' equity)
where,
Weightage average of common stockholders' equity equals to
= (Total common stockholders' equity at the beginning of the year + Total common stockholders' equity at the end of the year) ÷ 2
= ($410,000 + $290,000) ÷ 2
= $350,000
And, the other items values would remain the same
Now put these values to the above formula
So, the value would be equal to
= ($170,000 - $30,000) ÷ ($350,000)
= 40%