Answer:
The correct answer is d) The factor supply curve in an industry will shift to the left as wage rates in that industry rise.
Explanation:
The demand for factors is based in the demand for the goods and services that are produced using these factors and if the demand for the source good decreases, the demand for the production factor will also decrease.
In this case, when the market wages increase, the ability of suppliers to use labor goes down and as a result the demand curve will shift left.
Do It! Review 11-3a Incorrect answer. Your answer is incorrect. Try again. Riverbed Corp has 3,300 shares of 7%, $103 par value preferred stock outstanding at December 31, 2017. At December 31, 2017, the company declared a $123,500 cash dividend. Determine the dividend paid to preferred stockholders and common stockholders under each of the following scenarios. 1. The preferred stock is noncumulative, and the company has not missed any dividends in previous years. The dividend paid to preferred stockholders $Entry field with incorrect answer now contains modified data The dividend paid to common stockholders $Entry field with incorrect answer now contains modified data 2. The preferred stock is noncumulative, and the company did not pay a dividend in each of the two previous years. The dividend paid to preferred stockholders $Entry field with incorrect answer now contains modified data The dividend paid to common stockholders $Entry field with incorrect answer now contains modified data 3. The preferred stock is cumulative, and the company did not pay a dividend in each of the two previous years. The dividend paid to preferred stockholders $Entry field with incorrect answer now contains modified data The dividend paid to common stockholders $Entry field with incorrect answer now contains modified data Click if you would like to Show Work for this question: Open Show Work
Answer and Explanation:
1. The preferred stock is non-cumulative, and in previous years, the company has not skipped any dividends.
Dividend paid to preferred shareholders = Shares × Par value preferred stock × Shares percentage
= 3300 × $103 × 7%
= $23,793
Dividend paid to common shareholders = Cash dividend - Dividend paid to preferred shareholders
= $123,500 - $23,793
= $99,707
2. The preferred stock is non-cumulative, and in both of the two previous years, the company did not pay a dividend.
Dividend paid to preferred shareholders = Shares × Par value preferred stock × Shares percentage
= 3300 × $103 × 7%
= $23,793
Dividend paid to common shareholders = Cash dividend - Dividend paid to preferred shareholders
= $123,500 - $23,793
= $99,707
3. The preferred stock is cumulative, and in both of the two previous years the company did not pay a dividend.
Dividend paid to preferred shareholders = Shares × Par value preferred stock × Shares percentage × Number of years
= 3,300 × $103 × 7% × 3
= $71,379
Dividend paid to common shareholders = Cash dividend - Dividend paid to preferred shareholders
= $123,500 - $71,379
= $52,121
A company plans to issue new Preferred Stock that pays 6% on the Par Value of $25. Similar preferred stocks are current selling in the market for Pp = $28. If the firm expects flotation costs of 8% per share, then what is the cost of newly issued preferred stock to the firm? The firms tax rate = 40%.
Answer:
The cost of newly issued preferred stock to the firm is 5.82%
Explanation:
Annual dividend = $25 * 6% = $1.5
Present price = $28
Flotation costs = 8% = 8/100 = 0.08
Cost of new stock = Annual dividend / [Current price(1 - flotation costs)]
Cost of new stock = 1.5 / [ 28(1 - 0.08)]
Cost of new stock = 1.5 / [ 28(0.92)]
Cost of new stock = 1.5 / 25.76
Cost of new stock = 0.0582
Cost of new stock = 5.82% (Approx).
On July 23 of the current year, Dakota Mining Co. pays $6,492,240 for land estimated to contain 9,144,000 tons of recoverable ore. It installs and pays for machinery costing $1,280,160 on July 25. The company removes and sells 468,250 tons of ore during its first five months of operations ending on December 31. Depreciation of the machinery is in proportion to the mine's depletion as the machinery will be abandoned after the ore is mined.
Prepare entries to record the following:(a)To record the purchase of the land.(b)To record the cost and installation of machinery.
Answer:
a. Debit Land accounts $6,492,240
Credit Cash account $6,492,240
Being entries to record the purchase of land
and for the payment and installation of machinery,
b. Debit Machinery account (fixed asset) $1,280,160
Credit Cash accounts $1,280,160
Being entries to record the purchase and installation of machinery
Explanation:
When an asset is purchased with cash, the entries required are debit asset and credit cash. Such asset includes land, equipment, building, mines, inventory etc.
As such to record the purchase of a land,
Debit Land accounts
Credit Cash account
and for the payment and installation of machinery,
Debit Machinery account (fixed asset)
Credit Cash accounts
1. Nome Co. sponsors a defined benefit plan covering all employees. Benefits are based on years of service and compensation levels at the time of retirement. Nome determined that, as of September 30, year 2, its accumulated benefit obligation was $380,000, and its plan assets had a $290,000 fair value. The projected benefit obligation on September 30, year 2, was $400,000. In its September 30, year 2 balance sheet, what amount should Nome report as pension liability? $380,000 $110,000 $400,000 $ 90,000
Answer:
$110,000
Explanation:
There is pension liability for a corporation when the the projected benefit obligation (PBO) is greater than the fair value of plan assets. Therefore, pension liability is obtained by simply deducting the fair value of plan assets from the PBO as follows:
Pension liability = $400,000 - $290,000 = $110,000
Therefore, Nome should report $110,000 as pension liability in its September 30, year 2 balance sheet.
Exercise 21-14 (Algo) Identifying cash flows from investing activities and financing activities [LO21-5, 21-6][The following information applies to the questions displayed below.]In preparation for developing its statement of cash flows for the year ended December 31, 2021, Millennium Solutions, Inc. collected the following information:($ in millions)Payment for the early extinguishments oflong-term notes (book value: $65.0 million) $ 69.0Sale of common shares 212.0Retirement of common shares 131.0Loss on sale of equipment 2.9Proceeds from sale of equipment 11.6Issuance of short-term note payable for cash 19.0Acquisition of building for cash 11.5Purchase of marketable securities (not a cash equivalent) 14.0Purchase of marketable securities (considered a cash equivalent) 10.0Cash payment for 3-year insurance policy 12.0Collection of note receivable with interest (principal amount, $20) 22.0Declaration of cash dividends 50.0Distribution of cash dividends declared in 2020 47.0Exercise 21-14 (Algo) Part 1Required:1. In Millennium’s statement of cash flows, what were net cash inflows (or outflows) from investing activities for 2021?
Final answer:
In Millennium's statement of cash flows, the net cash inflows (or outflows) from investing activities for 2021 amounted to $8.1 million.
Explanation:
In Millennium's statement of cash flows, the net cash inflows (or outflows) from investing activities for 2021 can be calculated by summing the cash inflows and subtracting the cash outflows related to investing activities.
Based on the information provided, the cash inflows from investing activities include the proceeds from the sale of equipment ($11.6 million) and the collection of note receivable with interest ($22.0 million), totaling $33.6 million.
The cash outflows from investing activities include the acquisition of a building for cash ($11.5 million) and the purchase of marketable securities (not a cash equivalent) ($14.0 million), totaling $25.5 million.
Therefore, the net cash inflows (or outflows) from investing activities for 2021 would be $33.6 million minus $25.5 million, which equals $8.1 million.
A Corporation offers a 5.8 percent bond with a current market price of $823.50. The yield to maturity is 8.18 percent. The face value is $1,000. Interest is paid semiannually. How many years until this bond matures
Answer:
Explanation:
First of all, as the interest is paid semi-annually, we calculate semi-annual interest rate by dividing yield to maturity by the number of periods in a year (2).
Semi-annual interest rate = 0.0818 / 2 = 0.0409
Now using the following formula
[tex]YTM\;=\;\sqrt[n]{\frac{Face\;Value}{Current\;Price}}\;-\;1[/tex]
where,
YTM = 0.0409 (semi-annually)
Face Value = $1000
Current Price = $823.5
n = Number of semi-annual periods
[tex]0.0409\;=\;\sqrt[n]{\frac{1000}{823.5}}\;-\;1\\\\0.0409\;+\;1=\;\sqrt[n]{{1.214}}\\\\1.0409^{n} =\;1.214\\\\[/tex]
Taking natural log on both sides,
[tex]ln(1.0409)^{n} =ln(1.214)\\\\n*ln(1.0409)=ln(1.214)\\\\n=\frac{ln(1.214)}{ln(1.0409)}\\n=4.837[/tex]
Hence, semi-annual periods are 4.837. Therefore, the bond will mature in approximately (4.837/2) 2.4185 years.
Suppose Americans suddenly develop a strong taste for Canadian whiskey. What happens to the demand for Canadian dollars in the foreign exchange market? What happens to the value of Canadian dollars in the foreign exchange market? What about U.S. dollars? What happens to the quantity of net exports in Canada, other than whiskey, as a result of your answer in part b? What about the U.S.?
Answer:
A) If there is a sudden spike in the demand for Canadian Whiskey, the demand for Canadian Dollars will shoot upwards in the FX market.
B) When the demand for Canadian dollars does up in the FX market, the forces of demand and supply will force its price to increase in relation to the dollar.
C) If America is not exporting any commodity, or the number of Canadian goods imported into America is less than what it shipped out to them, then there is a trade deficit. Trade deficits if sustained can lead to a weaker currency.
D) Because the export demand for Canadian Whiskey has taken an upward spiral, the number of net exports in Canada will increase. When this happens, the currency is strengthened and so is the Canadian dollar. When the strength of a currency increases, it automatically gives more purchasing power to those holding that currency.
When compared to the U.S. with a consistently lowered net export, the dollar is likely to depreciate in value, thus eroding the spending or purchasing power of the U.S. dollar.
Cheers!
Select all of the following statements that are true four years from now, in the year 2023.
a. The Thrift segment will demand 7,754 thousand units
b. The Nano segment will demand 5,412 thousand units
c. The Core segment will demand 9,788 thousand units
d. The Elite segment will demand 5,879 thousand units
Answer:
The statements that are true four years from now, in the year 2023 are:
a. The Thrift segment will demand 7,754 thousand units
c. The Core segment will demand 9,788 thousand units
Explanation:
When it comes to the Thrift segment, the products or goods that are situated effectively and efficiently here are known to the market end users and are readily accessible. In this regard, there may perhaps be a possible rise in demand to 7,754 thousand units, continuing with the past trend of the same way.
The options that are true from the table will be:
The Thrift segment will demand 7,754 thousand unitsThe Core segment will demand 9,788 thousand unitsBased on the complete information and tables that are given, it can be inferred that the growth rate for the companies was given.
Growth rate simply means the percentage change of assets or investment for a particular period. From the table, it can be inferred that the thrift segment will demand 7,754 thousand units while the core segment will demand 9,788 thousand units.
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The _____ method of budgeting is being employed when expenditures are allocated by assigning a fixed amount of the unit product cost to promotion and multiplying this amount by the number of units sold.
Answer:
The correct answer is letter "B": percentage of sales.
Explanation:
The Percentage of Sales Method is an approach used at the moment of projecting the total amount of sales a company can process during the course of a year. This method aims to provide the firm with an idea of the sources necessary to produce enough output to meet its sales goal.
To forecast costs, the percentage of sales method allocates a fixed amount for a unit produced and then multiplies it by the number of sales projected.
Michael's, Inc., just paid $2.25 to its shareholders as the annual dividend. Simultaneously, the company announced that future dividends will be increasing by 4.9 percent. If you require a rate of return of 9.1 percent, how much are you willing to pay today to purchase one share of the company's stock?
Final answer:
Using the Gordon Growth Model, an investor who requires a 9.1% rate of return would be willing to pay $53.57 for a share of Michael's, Inc. stock, expecting future dividends to grow at a rate of 4.9 percent.
Explanation:
To determine the value of Michael's, Inc. stock given the dividend payment and growth rate, we will use the Gordon Growth Model. This model is used in financial analysis to determine the present value of a stock based on a future series of dividends that grow at a constant rate. Given that Michael's, Inc. paid an annual dividend of $2.25 and announced that future dividends will be increasing by 4.9%, and the investor requires a 9.1% rate of return, the calculation is as follows:
Present value of stock = Dividend per share / (Required rate of return - Growth rate)
Present value of stock = $2.25 / (0.091 - 0.049)
Present value of stock = $2.25 / 0.042
Present value of stock = $53.57
Therefore, an investor would be willing to pay $53.57 today for one share of Michael's, Inc. stock, expecting the dividends to increase at a constant rate of 4.9 percent.
Use the following selected 2016 balance sheet and income statement information for Home Garden Supply Co. (in millions) to compute the gross profit percentage to the nearest hundredth of a percent. Net income Gross profit on sales Average total assets Sales Tax rate on operating profit $69,960 $700,400 $360,600 $1,356,504 35% Select one: A. 9.99% B. 33.56%
Answer:
C.51.63%
Explanation:
Gross profit percentage = Gross profit/ Net sales ×100
Gross profit $700,400
Net sales $1,356,504
Hence ;
$700,400/$1,356,504 ×100
=51.63%
Therefore the gross profit percentage is
51.63%
The operating profit margin for Green Thumb Garden Center, calculated as operating income divided by sales, is approximately 44.5%, making option A. 44.50% correct.
To compute the operating profit margin, we use the formula:
Operating Profit Margin = (Operating Income / Sales) * 100.
Given:
Operating Income = $554,840 million
Sales = $1,248,552 million
Substitute these values into the formula:
Operating Profit Margin = (554,840 / 1,248,552) * 100.
Calculate the result:
Operating Profit Margin ≈ 44.5%.
Therefore, the operating profit margin for Green Thumb Garden Center is approximately 44.5%. The closest option is A. 44.50%, so the correct answer is A. 44.50%.
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Complete question below:
Use the following selected 2022 balance sheet and income statement information for Green Thumb Garden Center (in millions) to compute the operating profit margin to the nearest hundredth of a percent. Net income Operating income Sales Cost of goods sold Average total assets $50,940 $554,840 $1,248,552 $693,712 $420,300 Select one: A. 44.50% B. 49.21%
Which of the following is an example of frictional unemployment? Elaine is willing to work for less than the minimum wage, but employers cannot hire her. Joan is willing to work at the going wage, but there are no jobs available. Bill is qualified and would like to be an airline pilot, but airlines do not find it profitable to hire him at the wage established by the airline pilot's union.
After losing a large religion discrimination lawsuit, an employer instituted diversity training throughout the organization which was aimed at two purposes: 1) reducing prejudice against minorities; and 2) increasing awareness of EEO legislation prohibiting discrimination. These two purposes reflect which of the following training objective categories?a. 1) attitude; 2) knowledge b. 1) knowledge; 2) knowledge c. 3) attitude; 2) behavior/skill d. 4) behavior/skill; 2) attitude
Answer:
1) attitude; 2) knowledge
Explanation:
The first training is aimed at changing employee attitude and the second one is aimed at increasing knowledge.
Crane Company, organized in 2019, has set up a single account for all intangible assets. The following summary discloses the debit entries that have been recorded during 2020.
1/2/20 Purchased patent (9-year life)
$387,900
4/1/20 Purchase goodwill (indefinite life)
341,000
7/1/20 Purchased franchise with 10-year life; expiration date 7/1/30
421,000
8/1/20 Payment of copyright (5-year life)
145,200
9/1/20 Research and development costs
211,000
$1,506,100
Prepare the necessary entry to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation
Debit
Credit
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
Make the entry as of December 31, 2020, recording any necessary amortization. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
Account Titles and Explanation
Debit
Credit
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
enter an account title
enter a debit amount
enter a credit amount
Reflect all balances accurately as of December 31, 2020.
Use straight-line amortization
select an intangible asset
FranchisesCopyrightsResearch and development costsPatentsGoodwill
$enter a dollar amount
select an intangible asset
Research and development costsGoodwillFranchisesCopyrightsPatents
$enter a dollar amount
select an intangible asset
FranchisesResearch and development costsPatentsCopyrightsGoodwill
$enter a dollar amount
select an intangible asset
CopyrightsFranchisesResearch and development costsPatentsGoodwill
$enter a dollar amount
Answer:
Prepare the necessary entry to clear the Intangible Assets account and to set up separate accounts for distinct types of intangibles.
Dr Patents 387,900 Cr Intangible assets 387,900Dr Goodwill 341,000 Cr Intangible assets 341,000Dr Franchises 421,000 Cr Intangible assets 421,000Dr Copyright 145,200 Cr Intangible assets 145,200Dr Research and development expense 211,000 Cr Intangible assets 211,000
Make the entry as of December 31, 2020, recording any necessary amortization:
Dr Patents 387,900 Cr Intangible assets 387,900Dr Amortization expense 43,100 Cr Accumulated amortization - Patents 43,100Dr Goodwill 341,000 Cr Intangible assets 341,000Dr Franchises 421,000 Cr Intangible assets 421,000Dr Amortization expense 42,100 Cr Accumulated amortization - Franchises 43,100Dr Copyright 145,200 Cr Intangible assets 145,200Dr Amortization expense 29,040 Cr Accumulated amortization - Copyright 29,040
*R&D costs are expenses, they are not amortized.
Reflect all balances accurately as of December 31, 2020. Use straight-line amortization .
Patents $344,800Goodwill $341,000Franchises $378,900Copyright $116,160Giselle, the executive of an American transportation firm, is negotiating a deal with a Japanese corporation. During the meeting, Giselle notices that her negotiation partners frequently break into side conversations using their native language. What is the most likely reason for these side conversations?
Answer:
It could be to explain any confusion caused by differences in language
Explanation:
The official language in Japan is Japanese. Since some of the members of the team of Japanese corporation may not or have limited understanding of English Language, which was being used as a form of communication at the meeting, those who understand English very well among the members of the team of Japanese corporation may have to explain better in Japanese to their colleagues who do not or have limited understanding of English Language.
Research indicates that corporations using cross-national teams, whose members have international experience and communicate frequently with overseas managers, have greater product development capabilities.(a) True(b) False
Answer:
True
Explanation:
It is important you know that the term 'cross national team' implies teams from various countries.
Thus, when a company allows members who have international experience to communicate frequently with overseas managers, it will surely increases the Company's product development capabilities as result of the added wealth of a multinational workforce.Company's product development capabilities as result of the added wealth of a multinational workforce.
True, corporations that utilize multinational teams with international experience tend to have enhanced product development capabilities, enabling more effective global innovation and competitive advantages.
Research has shown that corporations employing cross-national teams, including members with international experience who frequently communicate with overseas managers, do indeed have stronger product development capabilities. Such teams benefit from a variety of perspectives that converge to foster innovation, reduce costs, and mitigate the risk of being preempted by competitors in the marketplace.
Examples of successful global collaboration include Fiat's development of the Palio in Brazil, Texas Instruments' use of Indian and U.S. engineer collaboration for advanced chip design, and Procter & Gamble's cross-border efforts leading to the creation of liquid Tide. These examples highlight the importance of leveraging global talent and knowledge to create competitive advantage through global innovation.
Moreover, hiring and training practices that emphasize a global perspective, such as Microsoft's and P&G's international training programs, support the development of a global mindset crucial for effective multinational operations and innovation. Therefore, the assertion that multinational teams with international communication experience contribute to greater product development capabilities is (a) True.
Cortland Corp. is considering the purchase of a new piece of equipment. The cost savings from the equipment would result in an annual increase in net cash flows of $148,400. The equipment will have an initial cost of $530,000 and have a 5-year life. If the salvage value of the equipment is estimated to be $12,000, what is the annual net income? Ignore income taxes.
Answer:
$44,800
Explanation:
To calculate annual net income we need to deduct depreciation from the annual increase in net cash flows.
Depreciation is calculated on a straight line basis using the following formulae:
Asset cost - Salvage value / useful life
530,000 - 12,000 / 5 = $103,600
Annual Net Income = 148,400 - 103,600 = $44,800
Hence, annual net income is $44,800.
Answer:
Net yearly income= $44,800
Explanation:
Depreciation can be defined as a reduction in the value of an asset over a certain period that is referred to as its useful life.
Depreciation expense reduces yearly income.
The yearly depreciation can be compared to yearly Revenue earned by its use to get net income.
Depreciation = (Value of asset - Salvage value) ÷ Number of useful years
Depreciation= (530,000 - 12,000) ÷ 5
Depreciation= $103,600
The yearly Revenue generated by using the asset is $148,400
Net yearly income= Increased cash flow - Depreciation
Net yearly income = 148,400 - 103,600
Net yearly income= $44,800
On June 1, 2017, Windsor, Inc. was started with an initial investment in the company of $22,420 cash. Here are the assets, liabilities, and common stock of the company at June 30, 2017, and the revenues and expenses for the month of June, its first month of operations:
Cash$ 4,830
Notes payable$12,460
Accounts receivable4,470
Accounts payable970
Service revenue7,730
Supplies expense1,100
Supplies2,300
Maintenance and repairs expense700
Advertising expense400
Utilities expense200
Equipment26,230
Salaries and wages expense1,630
Common stock22,420
In June, the company issued no additional stock but paid dividends of $1,720.
Prepare an income statement for the month of June."
Answer:
The Preparation of an income statement for the month of June is shown below:-
Explanation:
Windsor Inc
Retained Earnings Statement
For the year ending June 30,2017
Revenues
Service revenues $7,730
Expenses
Advertisement Expenses $400
Supplies expenses $1,100
Maintenance and repair expenses $700
Utilities expenses $200
Salaries and Wages expenses $1,630
Total Expenses $4,030
Net Income (Loss) $3,700
Suppose the daily market demand for meat in a small town is given by
Qd = 5/3p^2
where Qd is the quantity demanded (pounds of meat), and p is the price per pound of meat.
Suppose this market is served by a profit-maximizing monopolist (that is, there is only one butcher in this town). Suppose also that the price charged per pound of meat is $0.50. The monopolist's marginal cost must be _______.
In a monopoly market, a profit-maximizing monopolist sets the price equal to the marginal cost. Given that he's charging $0.50 per pound of meat, his marginal cost must therefore be $0.50.
Explanation:The given demand function is Qd = 5/3p^2. Here, Qd represents the quantity of meat demanded at a given price p. The monopolist, being the only butcher in the town, is a profit-maximizer and therefore sets his price equal to his marginal cost (MC). When the price per pound of meat is $0.50, we can substitute p into the demand function to find the quantity of meat demanded at this price. However, for a monopolist, the marginal cost of production remains constant. So, based on the conditions provided in your question, the monopolist's marginal cost must be $0.50 because a profit-maximizing monopolist sets price equal to marginal cost.
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Karma Company has prepared its operating budget for the first quarter of 20x9. The company forecasts sales of $50,000 in February, $60,000 in March, and $70,000 in April. Variable and fixed expenses are as follows:
Variable:
Power cost (40% of Sales)
Miscellaneous expenses (5% of Sales)
Fixed:
Salary expense: $8,000 per month
Rent expense: $5,000 per month
Depreciation expense: $1,200 per month
Power cost/fixed portion: $800 per month
Miscellaneous expenses/fixed portion: $1,000 per month
How much is the total operating expense for January?
A) $38,500 B) $47,500 C) $41,700 D) $43,000
$38,500 is the total operating expense for January
Solution:
Jan Feb Mar
Sales Budget 50,000 60,000 70,000
Operating Expenses Budget Jan Feb Mar
Variable operating expenses:
Power cost (40% of sales) 20,000 24,000 28,000
Misc. expenses (5% of sales) 2,500 3,000 3,500
Fixed operating expenses:Salary expense 8,000 8,000 8,000
Rent expense 5,000 5,000 5,000
Depreciation expense 1,200 1,200 1,200
Power cost (40% of sales) 800 800 800
Misc. expense (fixed portion) 1,000 1,000 1,000
Total operating expenses 38,500 43,000 47,500
The total operating expense for January is $16,000, summing up the fixed expenses as we lack sales data for January to calculate variable expenses. This amount is not available in the provided choices, suggesting a potential mistake in the question or options given.
To calculate total operating expenses for January for Karma Company, we need to sum up all variable and fixed expenses, even though the sales forecasts provided are for February, March, and April. Since we do not have sales data for January, we will only calculate fixed expenses as there would be no variable expenses without sales data.
Salary expense: $8,000Rent expense: $5,000Depreciation expense: $1,200Power cost/fixed portion: $800Miscellaneous expenses/fixed portion: $1,000Adding these together:
$8,000 (Salary) + $5,000 (Rent) + $1,200 (Depreciation) + $800 (Power) + $1,000 (Miscellaneous) = $16,000.
Therefore, the total operating expense for January is $16,000, which is not an option listed in the multiple choices provided (A, B, C, D), indicating that there may have been a mistake in the question or the options presented to the student.
A bond par value is $1,000 and the coupon rate is 6.5 percent. The bond price was $947.00 at the beginning of the year and $985.39 at the end of the year. The inflation rate for the year was 2.2 percent. What was the bond's real return for the year?
Answer:
10.92%
Explanation:
Bond return = ($985.39 - 947.00 + 65) / $947.00
Bond return = .1092, or 10.92%
Eastman Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and web-site construction is estimated to be $170,000. Variable processing costs are estimated to be $5 per book. The publisher plans to sell single-user access to the book for $45. Through a series of web-based experiments, Eastman has created a predictive model that estimates demand as a function of price. The predictive model is demand = 4,000 - 6p, where p is the price of the e-book. (a) Build a spreadsheet model to calculate the profit/loss for a given demand. What is the demand?
Answer:
the demand is 3,730 units
Explanation:
since the predictive model estimates demand as 4,000 - 6p, then at a selling price of $45 per ebook, the total demand = 4,000 - (6 x 45) = 4,000 - 270 = 3,730 units.
the estimated profit when demand = 3,730 is:
total revenue = 3,730 x $45 = $167,850
- variable costs = 3,730 x $5 = ($18,650)
- fixed costs = ($170,000)
net loss = -$20,800
I attached the excel spreadsheet model
Given the provided variable and fixed costs, selling price, and the predictive model of demand, it is possible to predict that Eastman Publishing Company would operate at a loss under these conditions.
Explanation:Eastman Publishing Company's profit or loss can be determined by subtracting the total variable and fixed costs from the total revenue. The total variable cost can be determined by multiplying the variable cost per unit ($5) by the demand. The demand can be calculated using the predictive model given, demand = 4,000 - 6p, plugging in $45 for p (the price of the e-book), gives us a demand of 4,000 - 6*45 = 4,000 - 270 = 3,730 e-books.
Now, calculate the total variable cost: 3,730 (demand) * $5 (variable cost per unit) = $18,650.
The total revenue can be calculated by multiplying the demand by the price: 3,730 * $45 = $167,850.
To calculate the profit or loss, subtract the total costs from the total revenue: profit or loss = total revenue - total costs => P/L = $167,850 - ($170,000 + $18,650) = -$20,800.
So, Eastman Publishing Company would be predicted to operate at a loss under these conditions.
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Autumnâ Services, Inc. acquired 124 comma 000 shares of Springâ Metals, Inc. on Januaryâ 1, 2018. Spring declares a cash dividend of $ 0.75 per share on Februaryâ 15, 2019 and pays the cash dividend on Marchâ 2, 2019. With the currentâ investment, Autumnâ Services, Inc. holds 12â% ofâ Spring's voting stock.
Prepare journal entry for the day when the dividend payment is madeâ (March 2,â 2019).
Answer:
Shareholders for dividends $93,000 (debit)
Cash $93,000 (credit)
Explanation:
Autumnâ Services, Inc holds a 12 % voting stock in Springâ Metals therefore it does not have control in terms of IFRS 10 and no consolidated statements must be produced.
The Acquisition of shares is thus a Financial Asset for Autumnâ Services, Inc.
February 15, 2019
When dividend is declared, recognize an equity item and a Liability in Spring Metals
Dividend $93,000 (debit)
Shareholders for dividends $93,000 (credit)
Dividend = 124,000×$ 0.75 per share
= $93,000
March 2, 2019
De-recognise the liability and de-recognise the cash asset in Spring Metals
Shareholders for dividends $93,000 (debit)
Cash $93,000 (credit)
Blue Dingo uses a standard costing system. The company's standard costs and variances for direct materials, direct labor, and factory overhead for the month of May are as follows. Variances Standard Cost Unfavorable Favorable Direct materials $ 80,000 Price variance $ 4,500 Quantity variance $ 3,000 Direct labor 184,000 Rate variance 2,700 Efficiency variance 6,200 Manufacturing overhead 271,000 Spending variance 4,000 Volume variance 5,000 Determine the actual costs incurred during the month of May for direct materials, direct labor, and manufacturing overhead.
Answer:
Actual Direct material cost = $81,500
Actual Direct labor cost = $187,500
Actual manufacturing overhead = $272,000
Explanation: kindly see attached picture for detailed explanation.
Variances ; Standard Cost Unfavorable Favorable Direct materials $ 80,000 Price variance $ 4,500 Quantity variance $ 3,000 Direct labor 184,000 Rate variance 2,700 Efficiency variance 6,200 Manufacturing overhead 271,000 Spending variance 4,000 Volume variance 5,000 Determine the actual costs incurred during the month of May for direct materials, direct labor, and manufacturing overhead.
Answer:
$81,800, $187,500, $181,000
Explanation:
Direct materials = Standard cost + Unfavorable Price variance - Favorable Quantity Variance
= $80,000 + $4,500 - $3,000
=$81,800
Direct Labor = Standard cost + Unfavorable Efficiency variance - Favorable Rate Variance
= $184,000 + $6,200 - $2,700
= $187,500
Manufacturing overhead = Standard cost - Favorable Spending variance - Favorable Volume Variance
= $271,000 - $4,000 - $5,000
= $181,000
During the current year, Martinez Company disposed of two different assets. On January 1, prior to their disposal, the accounts reflected the following: Asset Original Cost Residual Value Estimated Life Accumulated Depreciation (straight-line) Machine A $ 81,200 $ 7,400 15 years $ 63,960 (13 years) Machine B 25,000 3,000 8 years 16,500 (6 years) The machines were disposed of in the following ways: Machine A: Sold on January 2 for $25,000 cash. Machine B: On January 2, this machine was sold to a salvage company at zero proceeds (and zero cost of removal). Required: 1. & 2. Prepare the journal entries related to the disposal of Machine A and B on the January 2 of the current year. TIP: When no cash is received on disposal, the loss on disposal will equal the book value of the asset at the time of disposal. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
Solution:
S.NO. Accounts title and Explanations Debit Credit
1 Cash $25,000
Accumulated Depreciation- Machine A $63,960
Gain on Dispose: $10,400
Machine A $78,560
Accumulated Depreciation - Machine B $16,500
Loss on Disposal $10,700
Machine B $27,200
Note: -When the net value of the commodity disposed of is smaller than the amount paid, there is a benefit. If the worth of the book is MOT, there is a cost.
Which category (or type) of consumer products are: (1) relatively expensive, (2) infrequently purchased, and (3) buyers are willing to expend considerable effort in planning and making purchases? Examples: a house, car, furniture, or computer system
Answer:
consumer products provided are categorized thus:
(1) relatively expensive: a computer system
(2) infrequently purchased: A car
(3) buyers are willing to expend considerable effort in planning and making purchases: A house
Explanation:
Consumer products are defined as products that satisfy a consumer's wants or needs. There can be convenient, affordable as well as expensive and infrequently purchased.
Consumer goods are final goods sold to consumers for use. It is usually not used as means for further economic production activity.
Some consumer goods are durable and can last for up to three years or more while some are perishable with expiry dates and must be consumed within a short pace of time.
Finally, consumer goods can be grouped into different categories based on consumer behavior depending on how frequently they are used.
Who controls the supply for coffee shops and based on what factors
Answer:
Jeff controls the supply for coffee shops, based on the cost and wages.
Explanation:
Market prices control coffee shop supply, which is also influenced by other factors such as input and production costs, as well as technological advancements.
What is supply?The supply function denotes the amount of a particular good or service that producers are willing to offer in the market at various price levels.
According to the law of supply, there is a direct relationship between price and quantity supplied (ceteris paribus, hence, given that the rest remains equal). When the price of coffee rises, so does the amount that producers are willing to offer. Furthermore, other factors influence the quantity supplied because variations in those factors shift the supply curve:
Input prices: as input prices rise, production costs fall and suppliers are willing to offer more output. The supply curve shifts right.Technology advancements enable more efficient production, and sellers are willing to produce and offer a greater volume of output in the markets. The supply curve shifts to the right.Therefore, market prices, along with other factors controls the supply for coffee shops.
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You want a seat on the board of directors of Four Keys, Inc. The company has 265,000 shares of stock outstanding and the stock sells for $76 per share. There are currently 5 seats up for election. If the company uses cumulative voting, how many shares do you need to guarantee that you will be elected to the board
Answer:
44,167.67 shares
Explanation:
Given that
Number of shares of stock outstanding = 265,000
Sale value per share of stock = $76
Number of seat for election = 5
So by considering the above information, the number of shares needed by using the cumulative voting is
= {shares outstanding ÷ (number of seats + 1) + 1}
= {(265,000 shares ÷ (5 +1) +1}
= 44,167.67 shares
A 12-year bond of a firm in severe financial distress has a coupon rate of 12% and sells for $920. The firm is currently renegotiating the debt, and it appears that the lenders will allow the firm to reduce coupon payments on the bond to one-half the originally contracted amount. The firm can handle these lower payments. What are the stated and expected yields to maturity of the bonds? The bond makes its coupon payments annually.
Answer:
13.37% ; 7.01%
Explanation:
The computation of the stated and expected yields to maturity of the bonds is shown in the attachment below:
For stated yield, we use the RATE formula i.e
Given that,
Present value = $920
Assuming figure - Future value or Face value = $1,000
PMT = 1,000 × 12% = $120
NPER = 12 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after solving this, the stated yield is 13.37%
Now for expected yield, we also use the RATE formula i.e
Given that,
Present value = $920
Assuming figure - Future value or Face value = $1,000
PMT = 1,000 × 12% ÷ 2 = $60
NPER = 12 years
The formula is shown below:
= Rate(NPER;PMT;-PV;FV;type)
The present value come in negative
So, after solving this, the expected yield is 7.01%
Final answer:
The stated yield to maturity (YTM) for the bond was based on the full coupon rate of 12%, but after renegotiating the debt and halving the coupon payments, the expected YTM is calculated to be 6.944%.
Explanation:
We need to calculate the stated and expected yield to maturity (YTM) for a 12-year bond, which has a coupon rate of 12% and currently sells for $920. Post-renegotiation, the coupon payments will be halved. To find the stated YTM, we would typically use the coupon payments, face value, and current price of the bond. However, since the coupon payments are expected to change, we need to recalculate.
Originally, the annual coupon payment was 12% of $1000, which is $120. After renegotiating, the coupon payment will be half of this, so $60 per year. With 12 years to maturity and a current price of $920, we can use the formula for YTM for bonds with annual coupons:
YTM Calculation:
YTM = (C + ((F - P) / n)) / ((F + P) / 2)
C = Annual coupon payment ($60 after renegotiation)F = Face value of the bond ($1000)P = Current price of the bond ($920)n = Number of years to maturity (12)Plugging in the values, we calculate the expected YTM:
YTM = ($60 + (($1000 - $920) / 12)) / (($1000 + $920) / 2)
= ($60 + $6.67) / $960
= $66.67 / $960
= 0.06944 or 6.944%
The expected yield to maturity is 6.944%, whereas the originally stated YTM before renegotiation would have been based on the full coupon amount and the current price.
Hoffman, Inc. adjusts its books each month but closes its books at the end of the year. The trial balance at March 31 before adjustments is as follows: Debit Credit Cash $ 10,940 Accounts Receivable 9,640 Supplies 1,320 Prepaid Insurance 3,200 Equipment 27,000 Accumulated Depreciation: Equipment $ 10,800 Unearned Service Revenue 6,600 Capital Stock 5,300 Retained Earnings 23,500 Dividends 1,580 Service Revenue Earned 17,190 Salaries Expense 7,900 Utilities Expense 410 Rent Expense 1,400 $ 63,390 $ 63,390 According to service contracts, $4,830 of the Unearned Service Revenue has been earned in March. The amount of Service Revenue Earned to be reported in the March income statement is:
Answer:
$22,020
Explanation:
Given, (Before Adjustment)
Unearned Service Revenue $6,600
Service revenue $17,190
The adjusting entry to record the expired unearned revenue is
Debit Unearned Service Revenue $4,830
Credit Service revenue $4,830
Therefore, the amount of Service Revenue Earned to be reported in the March income statement is as follows:
Service revenue before adjustments = $17,190
Unearned Service Revenue earned in March = $4,830
Service revenue after adjustment = $22,020
Final answer:
The total Service Revenue Earned to be reported for Hoffman, Inc. for March is $22,020, which includes the initial $17,190 from the trial balance and an additional $4,830 recognized from the Unearned Service Revenue.
Explanation:
The student asked about the Service Revenue Earned to be reported in the income statement for Hoffman, Inc. at the end of March. Initially, the trial balance shows Service Revenue Earned of $17,190. According to the adjustments needed, $4,830 of the Unearned Service Revenue has been recognized as earned during March. Therefore, we need to add this amount to the initial Service Revenue Earned to determine the total revenue to be reported.
To calculate, we add $17,190 and $4,830:
Service Revenue Earned (initial amount): $17,190Plus: Amount of Unearned Service Revenue earned in March: $4,830Total Service Revenue Earned for March: $22,020The total Service Revenue Earned that should be reported in the income statement for March is $22,020.