Answer:
E) B exceeds that of A by the PV of $P for one year.
Explanation:
A begins in 2 years in the future, while B starts one year into the future:
B:
[tex]\frac{perpetuity}{(1 + rate)^{1}} [/tex]
A:
[tex]\frac{perpetuity}{(1 + rate)^{2}} = [/tex]
The difference is this one year difference which, makes the return on A lower than B today. After the two years, past and both perpetuities begin, their value will be the same.
In the context of marketing mix, localization can be adopted by:
a. selling the same product worldwide.
b. selling entirely new and customized products to the local markets.
c. selling a product that is successful in the home country.
d. selling products that appear to be locally adapted.
Answer:
d. selling products that appear to be locally adapted.
Explanation:
Localization:It refers to products which is locally adapted by the end-users. It is that thing which is easily adapted by the peoples and along with it, it can meet the needs of the people.
It overall impacts the customer buying behavior which includes their taste and preference, bargaining power, affordability, reasonable price, etc
By going throughout the options, the most correct option is D. So, other options are incorrect.
An assembly line can produce 90 units per hour. The line’s hourly cost (total salaries of workers) is $4,283 an hour (the first 8 hours). Workers are guaranteed a minimum of 6 hours (i.e., they will be paid for 6 hours per day, even if they work less than 6 hours). There is a 50% premium for overtime (i.e., salary is increased 50% during overtime hours), however, productivity for overtime drops by 7% (i.e., the number of units produced per hour drops 7%). What is the total costs if 966 units needs to be produced?
To produce 966 units, the total cost would be $56,133.825. This includes regular hours and overtime hours.
Explanation:To calculate the total cost of producing 966 units, we need to consider the regular hours and the overtime hours.
Regular hours: The assembly line can produce 90 units per hour, so it will take 966/90 = 10.73 hours to produce 966 units. Since workers are guaranteed a minimum of 6 hours, we can assume 6 hours of regular hours.
Overtime hours: The remaining 4.73 hours will be considered as overtime. Overtime salary is increased by 50%, so the hourly cost will be $4,283 * 1.5 = $6,424.5. However, productivity drops by 7%, so the assembly line will produce 90 * 0.93 = 83.7 units per hour of overtime.
Total cost: The total cost of regular hours is $4,283 * 6 = $25,698. The total cost of overtime hours is $6,424.5 * 4.73 = $30,435.825. The total cost of producing 966 units is $25,698 + $30,435.825 = $56,133.825.
In the context of market segmentation, unlike global citizens, global dreamers:
a. may not be able to afford, but nevertheless admire, global brands.
b. are skeptical about whether global brands deliver higher-quality goods.
c. are most likely to lead anti-globalization demonstrations.
d. believe that not all global brands are acceptable in the market.
Answer:
a. May not be able to afford, but nevertheless admire, global brands.
Explanation:
Let's analize all the statements for separate.
A.Global dreamers favour the global brands. Unlike global citizens can't afford them, but still admire them.
B. Refers to Antiglobals
C. Refers to global agnostics
D. Is against some global brands, can be seen as soft global agnostic.
Considering the world economic outlook for the coming year and estimates of sales and earning for the pharmaceutical industry, you expect the rate of return for Lauren Labs common stock to range between -20 percent and +40 percent with the following probabilities:Probability Possible Returns.10 -.20.15 -.05.20 .10.25 .15.20 .20.10 .40Compute the expected rate of return E(Ri) for Lauren Labs.
Answer:
The expected rate of return E(Ri) for Lauren Labs is 16.5%
Explanation:
The formula to compute the expected rate of return is shown below:
Expected rate of return = (Probability 1 × Possible Returns 1) + (Probability 2 × Possible Returns 2) + (Probability 3 × Possible Returns 3) + (Probability 4 × Possible Returns 4) + (Probability 5 × Possible Returns 5) + (Probability 6 × Possible Returns 6)
= (0.10 × 0.20) + (0.15 × 0.05) + (0.20 × 0.10) + (0.25 × 0.15) + (0.20 × 0.20) + (0.10 × 0.40)
= 2% + 0.75% + 2% + 3.75% + 4% + 4%
= 16.5%
Final answer:
The expected rate of return for Lauren Labs common stock is calculated by multiplying each possible return by its probability and summing the results, giving an expected rate of return of 11%.
Explanation:
To compute the expected rate of return E(Ri) for Lauren Labs, we multiply each possible return by its corresponding probability and sum up these products. The calculation is as follows:
(0.10 × -0.20) = -0.02
(0.15 × -0.05) = -0.0075
(0.20 × 0.10) = 0.02
(0.25 × 0.15) = 0.0375
(0.20 × 0.20) = 0.04
(0.10 × 0.40) = 0.04
Adding up these products, we get the expected rate of return for Lauren Labs:
-0.02 - 0.0075 + 0.02 + 0.0375 + 0.04 + 0.04 = 0.110 or 11%
Therefore, based on the provided probabilities and returns, the expected rate of return for Lauren Labs common stock is 11%.
Betty, a project manager, sent out agendas before an upcoming meeting to everyone involved. During the meeting, she got a team member to take minutes. After the meeting, Betty followed up with team members to check on their prog- ress. Evaluate Betty’s actions using the PDCA model. What, if anything, could she have done better?
Answer:
Check: Review the test, analyze the results, and identify what you’ve learned.
Explanation:
The four phases are:
Plan: identify and analyze the problem or opportunity, develop hypotheses about what the issues may be, and decide which one to test.
Do: test the potential solution, ideally on a small scale, and measure the results.
Check/Study: study the result, measure effectiveness, and decide whether the hypothesis is supported or not.
Act: if the solution was successful, implement it
Final answer:
Evaluate Betty's actions using the PDCA model and suggest improvements for her meeting management.
Explanation:
Betty's actions can be evaluated using the PDCA model:
Plan: Sending out agendas before the meeting.
Do: Conducting the meeting and assigning a team member to take minutes.
Check: Following up with team members to check progress.
Act: Making improvements based on the meeting outcomes for future meetings.
Improvements Betty could make: Clarifying team member roles, ensuring clear notes and action items, managing group dynamics for participation, and ending meetings on time.
SEO Keywords: PDCA model, team dynamics, meeting management
At night, use _____ on your rearview mirror. A. the hands-free setting B. cleaning solution C. windshield wiper fluid D. night view
Answer:
The correct answer is option D. night view
Explanation:
The first option, the hands-free setting, is a feature of the car which allows you to speak over the phone without using your hands and allowing you to maintain full control of the steering wheel and the gear shift lever, and it does not have anything to do with the rearview mirror.
Option B, cleaning solution, while it may be useful in order to clean your rearview mirror, that is a thing that shouldn't be done at night, because you are not able to clearly see at night if you wiped it down for good, and you might leave some residue that possibly could bother you when looking at the mirror.
Windshield wiper fluid isn't for cleaning your rearview mirror, but for helping removing residue/bugs stuck on your windshield.
Finally, option D, night view, is the correct option. Night view is a setting of rearview mirrors that is quite useful at night, because it reduces the amount of light reflected to the driver, avoiding the glare of high-beam headlights of cars behind to be directly reflected to the driver's eye that would make quite hard to focus in the dark ahead. It works by tilting the mirror out of line with the driver's view. In day mode, the reflection seen by the driver comes from the reflective surface, while in night view, the reflection comes from the glass, which only reflects a fraction of the light that the reflective surface does.
At night, use A. the hands-free setting on your rearview mirror.
At night, it is important to minimize distractions and ensure clear visibility while driving. Using the hands-free setting on your rearview mirror, if available, can help reduce glare from the headlights of trailing vehicles. This setting typically adjusts the angle of the mirror to reflect less light directly into the driver's eyes, which can be particularly helpful during nighttime driving.
The Richards Company manufactures a single product. All raw materials used are traceable to specific units of product. Current information for the Richards Company follows: Beginning raw materials inventory $ 15,000 Ending raw materials inventory 17,000 Raw material purchases 95,000 Beginning work in process inventory 45,000 Ending work in process inventory 30,000 Direct labor 135,000 Total factory overhead 65,000 Beginning finished goods inventory 60,000 Ending finished goods inventory 50,000 The company's cost of raw materials used, cost of goods manufactured and cost of goods sold is:
Answer:
Cost of raw materials=$93,000
Cost of manufactured period=$308,000
COGS= $318,000
Explanation:
A) Cost of raw materials:
We need to use the following formula:
Cost of raw materials= beginning inventory + purchase - ending inventory= 15,000 + 95,000 - 17,000= $93,000
B) We need to calculate the production during the period.
Cost of manufactured period= Beginning work in progress inventory+ direct materials + direct labor + factory overhead - ending work in progress
Cost of manufactured period= 45,000+ 93,000 + 135,000 + 65,000 - 30,000 =$308,000
C) The cost of goods sold refers to the direct costs attributable to the production of the goods sold in a company. This amount includes the cost of the materials used in creating the goods along with the direct labor costs used to produce the goods. It excludes indirect expenses, such as distribution costs and sales force costs.
COGS=Beginning Inventory+Production during period−Ending Inventory
COGS= 60,000 + 308,000 - 50,000 =$318,000
This calculation breaks down the various costs associated with a manufacturing company. The cost of raw materials used is $93,000. The cost of goods manufactured equals $308,000 and the cost of goods is $318,000.
Explanation:First, let's calculate the cost of raw materials used. You start with the beginning raw materials inventory of $15,000, add raw materials purchases of $95,000, then subtract the ending raw materials inventory of $17,000. So the cost of raw materials used is $15,000 + $95,000 - $17,000 = $93,000.
Next, let's calculate the cost of goods manufactured. The cost of goods manufactured consists of the cost of raw materials used ($93,000), direct labor ($135,000), and total factory overhead ($65,000). The sum of these is $293,000. To this, we then add the beginning work in process inventory ($45,000) and subtract the ending work in process inventory ($30,000). So the cost of goods manufactured is $293,000 + $45,000 - $30,000 = $308,000.
Finally, let's calculate the cost of goods sold. The cost of goods sold begins with the cost of goods manufactured ($308,000) and adds the beginning finished goods inventory ($60,000), then it subtracts the ending finished goods inventory ($50,000). So, the cost of goods sold is $308,000 + $60,000 - $50,000 = $318,000.
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If a factory produces 100 TV sets per year, each TV will be quite expensive to make. However, if a factory produces 20,000 TV sets each year, then it can set up an assembly line with huge machines and workers performing specialized tasks, and the average cost of production per TV will be lower. What is this an example of?
(A) specialization
(B) division of labor
(C) productivity
(D) economies of scale
Answer:
The correct answer is D: economies of scale
Explanation:
Economies of scale are the diminished cost by companies when production becomes efficient. Companies can achieve economies of scale by increasing production and lowering costs. This happens because fixed costs are spread over a larger number of goods. There are implications in variable costs as well (for example in obtaining discounts by large purchases from suppliers). In general, the larger the scale, the more cost savings.
The cost per unit depends on how much the company produces. Larger companies can produce more by spreading the cost of production over a larger amount of goods. Specialization of labor and more integrated technology boost production volumes. Lower per-unit costs can come from bulk orders from suppliers, larger advertising buys, or lower cost of capital. Spreading internal function (for ex: accounting, information technology, and marketing) costs across more units produced and sold helps to reduce costs.
Final answer:
The example described is of economies of scale, where increasing production leads to a lower average cost per unit. This occurs because of a more efficient production process and the spreading of fixed costs over a larger number of units. Hence, it is option D.
Explanation:
The concept described in the question is that of economies of scale. This is when the average cost of production per unit decreases as the level of production increases. For instance, producing 20,000 TV sets instead of just 100 allows a factory to invest in an assembly line, resulting in more automation and workers who can perform specialized tasks more efficiently. This specialized setup effectively reduces the average cost per TV set. Economies of scale happen because the fixed costs are spread over a larger number of units, and the factory can optimize production processes and use resources more effectively.
When considering other choices presented in the student's question, specialization and division of labor are closely related concepts and contribute to economies of scale. Specialization means workers focusing on a particular aspect of production, which enhances their expertise and efficiency. Division of labor is the breaking down of production into steps or tasks, where each worker or group performs a specific role. Together, these contribute to greater overall productivity, but the direct answer to what makes the average cost of production per TV set lower in larger amounts is economies of scale.
During the year, credit sales amounted to $ 820 comma 000$820,000. Cash collected on credit sales amounted to $ 760 comma 000$760,000, and $ 18 comma 000$18,000 has been written off. At the end of the year, the company adjusted for bad debts expense using the percentminus−ofminus−sales method and applied a rate, based on past history, of 2.52.5%. The ending balance of Accounts Receivable is ________.
Answer:
Account Receivable 42,000
Allowance (20,500)
Net 21,500
Explanation:
credit sales: 820,000
cash collected (760,000)
write-off (18,000)
Account Receivable 42,000
allowance for bad debt expense
820,000 x 2.5% = 20,500
The accout receivable gross balance will be 42,000
and the net will be 42,000 - 20,500 = 21,500
One reason we need government, even in a market economy, is that a the invisible hand seldom leads to an efficient allocation of resources in any market. b property rights become too entrenched in the absence of government. c the invisible hand, while powerful, is not perfect. d there are insufficient quantities of externalities in the absence of government.
Answer:
The correct answer is option c.
Explanation:
The term 'invisible hand' was coined by the economist Adam Smith in his book "Wealth of nations". It refers to the invisible market force that helps the economy to reach the equilibrium.
This invisible force though powerful is not perfect. In some cases, it fails to achieve efficiency which leads to market failure. In such situations, government intervention is necessary to efficiently allocate resources in the economy. So even in a market economy, we need government.
Creating an endowment Personal Finance Problem On completion of her introductory finance course, Marla Lee was so pleased with the amount of useful and interesting knowledge she gained that she convinced her parents, who were wealthy alumni of the university she was attending, to create an endowment. The endowment will provide for three students from low-income families to take the introductory finance course each year in perpetuity. The cost of taking the finance course this year is $300 per student (or $900 for 3 students), but that cost will grow by 2.2% per year forever. Marla's parents will create the endowment by making a single payment to the university today. The university expects to earn 6% per year on these funds. a. What will it cost 3 students to take the finance class next year? b. How much will Marla's parents have to give the university today to fund the endowment if it starts paying out cash flow next year? c. What amount would be needed to fund the endowment if the university could earn 8% rather than 6% per year on the funds?
Answer:
Course cost netxt year: 919.8
Perpetuity fund at 6% return: 24,205.27
Perpetuity funds at 8% return: 15,858.63
Explanation:
1 student 300
3 student 900
it grows at 2.2% per year
the return on the fund will be of 6%
The cost of the couse for next year will be:
900 x (1+2.2%) = 900 x 1.022 = 919.8
The perpetuity will be calculate as follow:
[tex]\frac{cost}{return-growth} = Perpetuity[/tex]
[tex]\frac{919.8}{0.06-0.022} = Perpetuity[/tex]
Perpetuity fund: 24205.26316
Ifthe return is for 8% per year:
[tex]\frac{919.8}{0.08-0.022} = Perpetuity[/tex]
Perpetuity funds: 15858.62069
The cost for 3 students to take the finance course next year would be $919.8. The initial endowment needed would be $22,995. An 8% fund's rate of return would decrease the necessary endowment to $15,996.55.
Explanation:The main concern of the problem shared involves evaluating a financial endowment created for the purpose of sponsoring students for a finance course. This falls under the field of Financial Mathematics, particularly focusing on the concept of perpetuities.
The cost for 3 students to take the finance class next year would require accounting for a 2.2% increase on the current cost of $900. This would come out to $900 * 1.022 = $919.8. To calculate the endowment amount needs to cover the perpetuity, Marla's parents would need to determine the present value of a growing perpetuity. The equation PV = D / (r - g) could be used, where D is the cost of the class next year, r is the return rate of 6%, and g is the growth rate of 2.2%. Using these values, the endowment needed would be $919.8 / (0.06 - 0.022) = $22,995. If the university could earn 8% rather than 6% per year on the funds, the calculation would change slightly. Utilizing the same growing perpetuity formula would get an endowment amount of $919.8 / (0.08 - 0.022) = $15,996.55. Learn more about Endowment Funding here:
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During 2020, Bramble Company changed from FIFO to weighted-average inventory pricing. Pretax income in 2019 and 2018 (Bramble’s first year of operations) under FIFO was $175,550 and $183,900, respectively. Pretax income using weighted-average pricing in the prior years would have been $147,000 in 2019 and $175,200 in 2018. In 2020, Bramble reported pretax income (using weighted-average pricing) of $201,100. Show comparative income statements for Bramble, beginning with "Income before income tax," as presented on the 2020 income statement. (The tax rate in all years is 30%.)
Answer:
Explanation:
For showing the comparative income statement, first we have to do the calculations which are shown below:
For 2020 = Pretax income using weightage average pricing - tax rate @30%
= $201,100 - $60,330
= $140,770
For 2019 = Pretax income using weightage average pricing- tax rate @30%
= $147,000 - $44,100
= $102,900
For 2018 = Pretax income using weightage average pricing - tax rate @30%
= $175,200 - $52,560
= $122,640
We ignored the computation through FIFO method
The computation of the comparative income is shown in spreadsheet. Kindly find the attachment below:
Allison will graduate from high school next June. She has ranked her three possible post-graduation plans in the following order: (1) work for two years at a consulting job in her hometown paying $20,000 per year, (2) attend a local community college for two years, spending $5,000 per year on tuition and expenses, and (3) travel around the world tutoring a rock star’s child for pay of $5,000 per year. What is the opportunity cost of her choice?
Answer:
tutoring opportunity cost: 20,000 consulting job
consulting job opportunity cost: 5,000 + travel from tutoring
collegue: 20,000 consulting job
Explanation:
opportunity cost: cost of the best rejected project, proposal or income
income from work as a consulting job: 20,000
income from tutoring: 5,000 ( externality of travel around the world)
collegue cost of 5,000
The tutorng has an externality of travel around the world. We can measure how much Allison values that chances but it is something she will consider when picking her plan.
The opportunity cost of Allison's choice is $30,000.
Explanation:The opportunity cost of Allison's choice is the value of the next best alternative that she is giving up. In this case, her opportunity cost is the income she could have earned if she chose to work for two years at the consulting job instead of pursuing her other options.
Here's how we can calculate the opportunity cost:
Option 1: Work for two years at a consulting job = $20,000/year x 2 years = $40,000
Option 2: Attend a local community college for two years = $0 (no income)
Option 3: Travel around the world tutoring a rock star's child for two years = $5,000/year x 2 years = $10,000
Therefore, the opportunity cost of Allison's choice is $40,000 - $10,000 = $30,000.
The Longo Corporation issued $60 million maturity value in notes, carrying a coupon rate of six percent, with interest paid semiannually. At the time of the note issue, equivalent risk-rated debt instruments carried yield rates of eight percent. The notes matured in five years.Calculate the proceeds that Longo Corporation will receive from the sale of the notes. How will the notes be disclosed on Longo’s balance sheet immediately following the sale? Calculate the interest expense for Longo Corporation for the first year that the notes are outstanding. Calculate the balance sheet value of the notes at the end of the first year
Answer:
It will receive: 47,015,745
Balance sheet after issuance of the bonds:
bonds payable: 60,000,000
discount on bond payable: (12,984, 255)
carrying value: 47, 015, 745
Interest expense for the first years outstanding: 3,764,485
Balance sheet after one year:
bonds payable: 60,000,000
discount on bond payable: (12,819,770)
carrying value: 47,180,230
Explanation:
We will calculate the present value of the coupon payment and the maturity at the market value.
Present value of the cuopon using ordinary annuity present value
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
Coupon payment: 60,000,000 x 6%/2 as the payment are semiannually $1,800,000
time: 5 years x 2 payment per year = 10 payment
rate 8% / 2 paymnet per year: 0.04
[tex]1800000 \times \frac{1-(1+0.04)^{-10} }{0.04} = PV\\[/tex]
PV $14,599,612.4028
Maturity present value using lump sum present value
[tex]\frac{Maturity}{(1 + rate)^{time} } = PV[/tex]
Maturity 60,000,000.00
time 8.00
rate 0.08
[tex]\frac{60000000}{(1 + 0.08)^{8} } = PV[/tex]
PV 32,416,133.07
Then we sum both:
PV coupon $14,599,612.4028
PV maturity $32,416,133.0701
Total market $47,015,745
face value: 60,000,000
discount: 12 ,984,255
Interest expense:
first payment:
47,015,745 x 0.08/2 = 1.880.630 interest expense
cash proceeeds 1,800,000
amortization 80,630
second payment:
(47,015,745 + 80,630) = carrying value = 47,096,375
47,096,375 x 0.04 = 1,883,855 interest expense
cash proceeds 1,800,000
amortization 83,855
total interest expense 1,880,630 + 1,883,855 = 3,764,485
discount on bonds: 12 ,984,255 - 80,630 - 83,855 = 12,819,770
The proceeds from the sale of the notes, the interest expense for the first year, and the balance sheet value of the notes at the end of the first year, can all be determined from the details provided. The bond's present value and the interest expenses form crucial parts of these calculations. These notes will be marked as a liability on Longo's balance sheet.
Explanation:To answer this question, we need to understand a few basic concepts related to bonds. A bond is basically an 'I owe you' note from the issuer to the investor, with the face value being the amount the issuer agrees to pay the investor at maturity. The coupon rate or interest rate is defined beforehand and in this case are paid semiannually. The bond's present value is the maximum amount an investor would be willing to pay for it, and depends on market conditions.
Now, the Longo Corporation has issued notes with a maturity value of $60 million, carrying a coupon rate of six percent, with interest paid semiannually. However, the equivalent risk-rated debt instruments carried yield rates of eight percent. Therefore, the present value of the bond would be less than the face value because the coupon rate is less than the market rate.
To calculate the proceeds that Longo Corporation will receive from the sale of the notes, we need to take into account the face value, coupon rate, market rate and maturity. We will also need to calculate the interest expense for the first year which will incorporate the interest rate, face value, and the number of periods.
Finally, the notes will be disclosed on Longo's balance sheet as a liability reflecting the amount that Longo owes to the investors. The balance sheet value of the notes at the end of the first year would reflect the present value of the bond, plus any interest expenses accumulated over the year.
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A friend of yours is considering two cell phone service providers. Provider A charges $120 per month for the service regardless of the number of phone calls made. Provider B does not have a fixed service fee but instead charges $1 per minute for calls. Your friend's monthly demand for minutes of calling is given by the equation QD=150−50P, where P is the price of a minute. Your friend would obtain _________ in consumer surplus with Provider A and _______ in consumer surplus with provider B. Given this information, which provider would you recommend that your friend choose?
Answer:
for provider B the surplus is 100
for provider A te surplus is 125
If my friend is a rational consumer it will pick the Provider A
Explanation:
if P = 1 then:
150 - 50(1) = 100
To know the surplus we calculate the area of the demand above the market price:
(P0 -Pm)Qm/2
(3-1) x (100) / 2 = 2 x 100 / 2 = 100
For provider A then P will be zero so
150 - 50(0) = 150 minutes
the surplus will be the area of the demand curve less the fixed cost
3*150/2 - 100 = 225 - 100 = 125
The consumer surplus with Provider A is $0 because the cost they are willing to pay and what they actually pay is the same. For Provider B, the consumer surplus is $25 because Provider B charges for each individual minute used. Therefore, if the only thing considered is consumer surplus, Provider B is the better option.
Explanation:To analyze the consumer surplus for each provider, we need to understand the demand equation QD=150-50P and apply it to the cost structures of each provider. For provider A, the price is always $120 a month, regardless of the minutes used. As a result, the consumer surplus for provider A is the difference between the maximum the customer is willing to pay and the actual cost they pay, which ends up being $0 as these amounts are the same.
For provider B, the cost of each minute is $1. Insert this value into the demand equation to find QD=150-50(1) = 100 minutes. The consumer surplus with provider B would be 0.5 * (150 - 100) * (1 - 0) = $25.
In conclusion, if consumer surplus is the only factor considered, your friend should choose provider B which provides a >$25< consumer surplus compared to $0 of provider A.
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The super prize in a contest is $10 million. This prize will be paid out in equal yearly payments over the next 20 years. If the prize money is guaranteed by AAA bonds yielding 4% and is placed into an escrow account when the contest is announced 1 year before the first payment, how much do the contest sponsors have to deposit in the escrow account? (Round your answer to the nearest cent.)
Answer:
contest sponsors have to deposit $6795163.17 in the escrow account
Explanation:
given data
amount = $10 million
time = 20 year
rate = 4 %
to find out
how much do the contest sponsors have to deposit in the escrow account
solution
we know Cash flow per period = 10000000/20 = $500000
we will apply here future value formula to find amount
future value = cash flow × [tex]\frac{1-(1+r)^{-t}}{r}[/tex]
here r is rate and t is time
put here value
future value = 500000 × [tex]\frac{1-(1+0.04)^{-20}}{0.04}[/tex]
future value = 6795163.1724
so contest sponsors have to deposit $6795163.17 in the escrow account
The contest sponsors have to deposit $13,589,000 in the escrow account.
Explanation:To calculate how much the contest sponsors have to deposit in the escrow account, we need to find the present value of the $10 million prize that will be paid out over 20 years. Since the prize is guaranteed by AAA bonds yielding 4%, we can use the present value formula for an annuity:
PV = PMT * [(1 - (1 + r)^-n) / r]
PV = $10,000,000 * [(1 - (1 + 0.04)^-20) / 0.04] = $10,000,000 * [(1 - 0.4564) / 0.04] = $10,000,000 * [0.5436 / 0.04] = $13,589,000
Therefore, the contest sponsors have to deposit $13,589,000 in the escrow account.
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Assume that Best Buy made a December 31 adjusting entry to debit Salaries Expense and credit Salaries Payable for $4,200 for one of its departments. On January 2, Best Buy paid the weekly payroll of $7,000. Prepare Best Buy's (a) January 1 reversing entry; (b) January 2 entry (assuming the reversing entry was prepared); and (c) January 2 entry (assuming the reversing entry was not prepared).
Answer:
salaries payable 4,200 debit
salaries expense 4,200 credit
----- reversing entry -----
salaries expense 7,000 debit
cash 7,000 credit
----payment of wages7wtih reserving entry----
salaries payable 4,200 debit
salaries expense 2,800 debit
cash 7,000 credit
---- payment without reversingentry ----
Explanation:
(A) the reversal entry will be like the adjusting entry done backwards.
(B) when the journal entry is made, then we recognize expense for the full amount. leaving a balance for the expense for the current period:
wages expense
debit credit
4,200
7,000
2,800 debit balance
(C) if no reversing entry was made, then we use the payable and recognize expense for the period
7,000 - 4,200 = 2,800 expense
find deri(10 points) A survey gives the value of the following variables for a sample of households in the UK: x1= number of people in the household x2= total household income x3= total household expenditure on food x4= total household expenditure on clothing x5= total household expenditure on alcohol and tobacco x6= total household expenditure on other goods write the functions which give: (a) total household income (b) total household saving (c) income per person (d) expenditure on clothing per person
Answer:
Instructions are listed below
Explanation:
Giving the following information:
x1= number of people in the household
x2= total household income
x3= total household expenditure on food
x4= total household expenditure on clothing
x5= total household expenditure on alcohol and tobacco
x6= total household expenditure on other goods
A) total household income = x2
B) total household saving= x2-x3-x4-x5-x6
C) income per person= x2/x1
D) expenditure on clothing per person= x4/x1
Fernwood Company is preparing the company's statement of cash flows for the fiscal year just ended. The following information is available: Retained earnings balance at the beginning of the year $ 308,000 Cash dividends declared for the year 68,750 Proceeds from the sale of equipment 118,000 Gain on the sale of equipment 6,750 Cash dividends payable at the beginning of the year 30,250 Cash dividends payable at the end of the year 37,500 Net income for the year 151,250 The ending balance in retained earnings is:
Answer:
Ending balance in retained earnings = $397,250.
Explanation:
The opening balance in the Retained Earnings account is 308,000. which will be on the Credit side.
The following items will be credited to the account:
Gain on the sale of equipment - 6,750Net income for the year - 151,250The following item will be debited to the account:
Cash dividend declared for the year - 68,750Total sum of the Credit side will be 466,000. Less the sum of items on the Debit side[68,750] will result to a closing balance of 397,250.
A more visual representation is detailed in the attachment.
Ruff, Inc. makes dog food out of chicken and grain. Chicken has 10 grams of protein and 5 grams of fat per ounce, and grain has 2 grams of protein and 2 grams of fat per ounce. A bag of dog food must contain at least 226 grams of protein and at least 166 grams of fat. If chicken costs 11¢ per ounce and grain costs 1¢ per ounce, how many ounces of each should Ruff use in each bag of dog food to minimize cost? HINT [See Example 4.] (If an answer does not exist, enter DNE.)
Answer: Ruff, Inc., should use 0 oz of chicken and 113 oz grain.
Explanation:
Given that,
Chicken:
10 grams of protein
5 grams of fat per ounce
Grain:
2 grams of protein
2 grams of fat per ounce
Chicken costs = 11¢ per ounce
Grain costs = 1¢ per ounce
Let x be chicken and y be grain
Objective is to minimize 11x +y
subject to
10x +2y ≥ 226
5x + 2y ≥ 166
Solving these two equations, we get,
point (1)- (12, 53) and two corner solution
(2)- (0,113)
(3)- (33.2,0)
Price of 1) = 12 × 11 + 53 × 1 = 185
Price of 2) = 0 ×11 + 113 × 1 = 113
Price of 3) = 33.2 × 11 + 0 × 1 = 365.2
Therefore, Ruff, Inc., should use 0 oz of chicken and 113 oz grain.
To minimize cost, we need to set up a system of equations based on the requirements for protein and fat in the dog food and use a graphing calculator to find the point with the lowest cost.
Explanation:To minimize cost, we need to set up a system of equations based on the requirements for protein and fat in dog food. Let's use x to represent the number of ounces of chicken and y to represent the number of ounces of grain used in each bag of dog food.
The total protein in the dog food can be calculated as 10x + 2y, and the total fat can be calculated as 5x + 2y. We can set up inequalities based on the minimum protein and fat requirements: 10x + 2y ≥ 226 and 5x + 2y ≥ 166.
We also need to consider the cost. The cost of chicken is 11 cents per ounce and the cost of grain is 1 cent per ounce. The total cost can be calculated as 11x + y. To minimize cost, we can use a graphing calculator to find the feasible region and locate the point with the lowest cost.
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Beta coefficients and the capital asset pricing model Personal Finance Problem Katherine Wilson is wondering how much risk she must undertake to generate an acceptable return on her porfolio. The risk-free return currently is 4%. The return on the overall stock market is 14%. Use the CAPM to calculate how high the beta coefficient of Katherine's portfolio would have to be to achieve a portfolio return of 16%.
Answer:
Beta = 1.2
Explanation:
Given:
The risk-free return = 4%
The return on the overall stock market = 14%
The portfolio return to be achieved = 16%
Now,
from capital asset pricing model,
Expected return = Risk-free return + Beta (Market Return - Risk-free return)
on substituting the respective values, we get
16% = 4% + Beta × ( 14% - 4% )
or
12% = Beta × ( 10% )
or
Beta = 1.2
Final answer:
To achieve a portfolio return of 16%, with a risk-free rate of 4% and a market return of 14%, the beta coefficient of Katherine Wilson's portfolio would need to be 1.2.
Explanation:
To calculate the beta coefficient for Katherine Wilson's portfolio using the Capital Asset Pricing Model (CAPM), we need to arrange the CAPM formula to solve for beta:
Expected return = Risk-free return + Beta * (Market return - Risk-free return)
Katherine desires a portfolio return of 16%. Given that the risk-free return is 4% and the return on the overall stock market is 14%, we can plug these values into the formula:
16% = 4% + Beta * (14% - 4%)
To solve for Beta, subtract the risk-free rate from both sides:
12% = Beta * 10%
Now divide by the market premium (10%):
Beta = 1.2
Therefore, the beta coefficient Katherine's portfolio would need to achieve a return of 16% is 1.2.
John works as a quality analyst at a technological firm. He wanted to buy a mobile phone for his wife. Though he was abreast of the latest mobile phone brands that were introduced in the global market, he bought a phone that was produced and marketed locally. He was skeptical about whether global brands deliver high-quality goods. In the context of market segmentation, it is evident that John falls under the segment of _____.
a. global citizens
b. global dreamers
c. antiglobals
d. global agnostics
Answer:
C.
Explanation:
In marketing, when we are analizing the market segmentation we can divide in 4 categories.
Global Citizens and Global Dreamers are both positive toward international brands.
Global Citizens are concerned with corporate responsibility toward local country while Global Dreamers are less concerned.
The global agnostics don’t base decisions on origin of brand.
And the Antiglobals are negative toward international brands. John was skeptical about the quality of the goods because of the origin of the brand.
Inventory 12/31/17 $59,030 Cost of Goods Sold $224,679 Common Stock 76,110 Selling Expenses 16,230 Retained Earnings 45,580 Administrative Expenses 38,719 Dividends 18,337 Income Tax Expense 30,480 Sales Returns and Allowances 11,914 Sales Discounts 15,020 Sales Revenue 417,650 Prepare closing entries for Wildhorse Co. on December 31, 2017.
Answer:
Prepare closing entries for Wildhorse Co. on December 31, 2017
Explanation:
Sales revenue 417.650
Sales discount 15.020
Cost of goods 224.679
Selling expense 16.320
Administrative expense 38.719
Income tax expense 30.480
sales return and allowance 11.914
retained earnings 104.346
Winston Watch's stock price is $70 per share. Winston has $10 billion in total assets. Its balance sheet shows $1 billion in current liabilities, $3 billion in long-term debt, and $6 billion in common equity. It has 400 million shares of common stock outstanding. What is Winston's market/book ratio? Do not round intermediate calculations. Round your answer to two decimal places.
Answer:
The Market/book ratio is 5.67.
Explanation:
Book value per share = (common equity)/(number of shares)
= ($ 6 billion)/($ 400million )
= $ 15 per share
Market/book ratio = (market price per share)/(book value per share
= $75/$15
= 5.00
Therefore, the Market/book ratio is 5.67.
In order to understand how the price of a good is determined in the free market, one must account for the desires of:
A. purchasers exclusively.
B. sellers exclusively.
C. governmental agencies exclusively.
D. purchasers and seller
Answer: Purchasers and sellers
Explanation: Free market refers to a market structure in which the goods and services are priced on the basis of market forces of demand and supply. The intervention of Government in such markets for the purpose of price controlling is very minimal.
The demand force depends on the purchasers and the supply force depends on the sellers.
Thus, from the above we can conclude that the correct option is A.
A company makes greeting cards and their research shows that that price and demand are related linearly: p = m x + b . They know that for every additional card they wish to sell they need to drop the price by $0.10. They also know that in order to sell 260 cards they need to set the price at $7. Find the linear equation relating price to demand.
Answer: p = (-0.10)x + 33
Explanation:
Given that,
p = m x + b .......(1)
Price and demand are related linearly.
m = -0.10, x = 260 and p = 7
Substituting all these in equation (1) for calculating the value of b,
7 = -0.10 × 260 + b
b = 7 + 26
b = 33
Therefore, linear equation relating price to demand is as follows:
p = (-0.10)x + 33
Final answer:
The linear equation relating price to demand for the company's greeting cards, given the decrease in price per additional card and a specific price-quantity example, is p = -0.10x + 33.
Explanation:
The question asks for the linear equation relating price to demand for a company that makes greeting cards. Given that for every additional card sold the price must decrease by $0.10, and to sell 260 cards the price is set at $7, we can use the linear equation p = mx + b. Here, m (slope) represents the change in price per card, which is -$0.10, and x represents the quantity of cards. Knowing one point on the line allows us to solve for b, the y-intercept. Substituting the values, we have 7 = -0.10(260) + b. Solving this equation for b gives us b = $33. Therefore, the linear equation relating price to demand is p = -0.10x + 33.
On May 19, Integrity Repair Service extended an offer of $335,000 for land that had
been priced for sale at $363,000. On June 4, Integrity Repair Service accepted the seller's
counteroffer of $345,000. On October 10, the land was assessed at a value of $290,000
for property tax purposes. On February 5 of the next year, Integrity Repair Service was
offered $380,000 for the land by a national retail chain. At what value should the land
be recorded in Integrity Repair Service's records?
Answer:
$345,000
Explanation:
Counter offer: The counter-offer is the changes made in the existing offer terms and conditions. It is usually made for negotiations, in which both the party can agree at the final price.
According to the accounting principles, the land value should be recorded at the historical cost but in the given case, it is recorded at the counter offer value because, in this offer, both the parties are ready to buy and sell the fixed assets i.e land.
It records only purchase cost of the land ,not any land improvement costs. So, only $345,000 should be recorded in Integrity Repair Service's records
Inventory records for Dunbar Incorporated revealed the following:
Date Transaction Number of Units Unit Cost
Apr. 1 Beginning inventory 410 $2.33
Apr. 20 Purchase 380 2.74
Dunbar sold 640 units of inventory during the month. Ending inventory assuming FIFO would be (Do not round your intermediate calculations. Round your answer to the nearest dollar amount):
A. $349.
B. $955.
C. $411.
D. $1,123.
Answer: The correct answer is "C. $411.".
Explanation: The inventory before the sale is:
Date Transaction Number of Units Unit Cost Total Cost
Apr.1 Beginning Inv. 410 $2,33 $955,30
Apr.20 Purchase 380 $2,74 $1041,20
The sale according to the FIFO (First in - First out) system would be:
Transaction Number of Units Unit Cost Total Cost
Sales 410 $2,33 $955,30
230 $2,74 $630,20
Total: $1585,50
Ending inventory is:
Number of Units Unit Cost Total Cost
150 (380-230) $2,74 $411
To calculate the ending inventory by FIFO, first deduct the no. of sold units from the beginning inventory and then remaining from the purchase inventory. Multiply the remaining units with their purchase unit cost.
Explanation:To determine the ending inventory assuming FIFO (First-In-First-Out), we need to assume the items that Dunbar Incorporated sold first were the ones they acquired first. Given the units sold are 640, these will be 410 units from the beginning inventory plus 230 out of the 380 units purchased on April 20th. To calculate the cost for this, the cost corresponding to these transactions is calculated as follows:
(410 units * $2.33) + (230 units * $2.74).
For the ending inventory, we consider the remaining inventory which is (380 purchase units - 230 sold units) * $2.74 (unit cost). This gives us the value of the ending inventory in the FIFO method.
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You are the manager of a medium-sized farm with 100 acres of workable land. You can farm the land yourself, rent the land to another farmer for $2,000 per acre, or sell the land to a developed for $40,000 per acre. You have an investment opportunity that pays a return of 6 percent a year. If you decide to farm the land yourself, your opportunity cost for a year will be
Answer:
The opportunity cost for a year will be $240,000.
Explanation:
The opportunity cost of any decision is the second-best alternative that is given up or sacrificed.
Here, the manager has a farm of 100 acres of land.
If he sells it to a developer for $40,000 per acre, he will get $4,000,000 for the whole land.
He can invest this amount and get an interest of 6% per year.
The opportunity cost of keeping the farm to the manager himself will be
= 6% of $4,000,000
= [tex]\frac{6}{100}\ \times\ \$ 4,000,000[/tex]
= $240,000
Answer:
other person is right
Explanation:
240,000 is the right answer
Suppose you bought 700 shares of stock at an initial price of $43 per share. The stock paid a dividend of $0.40 per share during the following year, and the share price at the end of the year was $44. Compute your total dollar return on this investment.
Answer:
Total dollar return = $980
Explanation:
Data:
S = Shares of Stock = 700
P0 = Initial Price = $43
D = Dividends = $0.40
P1 = Price at the end of the year = $44
DR = Dollar Return = ?
Equation:
DR = S * (P1 - P0 + D)
Calculation:
DR = 700 * ($44 - $43 + $0.40)
DR = 700 * ($1.40)
DR = $980
The total dollar return on this investment is $980.
Hope this helps!