Answer:
c) In-kind transfers do not add to people's incomes but are counted as income.
Explanation:
In the given scenario the aim of the census is to measure income inequality in the population selected.
If however the amount of income earned by individuals is not estimated accurately the results of the study will be inaccurate.
In kind transfers are usually goods and services that a person gets for free of at a reduced rate. They are not considered to be income.
When in kind transfers are counted as income and do not actually add up to income, we cannot get a true picture of income of participants of the income survey.
People who have low income but high in kind transfers will be considered high income earners which is not true.
On January 1, 20x1, the ABC Corporation purchased 80% of the XYZ Company's voting stock for $3,000,000. The FMV of all of XYZ's stock was $4,025,000, and XYZ's net assets had a book value of $2,850,000; the fair values of XYZ's assets are equal to their book values, with the exception of land, which is $625,000 greater than its book value. Assuming that ABC Corporation used the acquisition method to prepare its consolidated balance sheet, how much goodwill was reported on the January 1, 20X1 consolidated balance sheet assuming that the "full goodwill" method is used?
Answer: $440000
Explanation:
Fair market value = $4025000
Book value of asset = $2,850,000
Land value = $625,000
The value of the goodwill will be
(Fair market value - book of asset - land value) × 80%
= ($4,025,000 - $2,850,000 - $625,000) × 80%
= 550000 × 80%
= 550000 × 0.8
= $440,000
Perdue found that one of its chicken products may have been contaminated with bacteria, so it pulled it off the shelves and instituted a recall. This potential ethical issue was associated with which element of the marketing mix?
1. product
2. price
3. distribution
4. marketing communications promotion
Answer:
1. Product
Explanation:
Perdue finding out that one of its chicken products may have been contaminated with bacteria, pulled it off the shelves and instituted a recall.
Hence, this potential ethical issue is associated with product marketing mix because Perdue was very much concerned about the quality level, safety and reliability of his chicken products. This simply means, Perdue is much more interested in producing and selling highly uncontaminated products to it's customers.
A product marketing mix is focused mainly on the products, reason Perdue pulled the chicken products off the shelves and instituted a recall.
This would help to boost confidence among their customers to use more of their products in the future and by extension their market share.
An asset was acquired on September 30, 2021, for $104,000 with an estimated five-year life and $25,000 residual value. The company uses double-declining-balance depreciation. Calculate the gain or loss if the asset was sold on December 31, 2022, for $54,000. Partial-year depreciation is to be calculated.
Answer:
There is a loss on disposal of $80
Explanation:
The double declining rate method of depreciation is an accelerated form of charging depreciation on an asset. It charges higher depreciation in the earlier years and lower depreciation in the later years of the useful life of the asset. the formula for double declining balance depreciation per year is,
Depreciation expense = 2 * [ (Cost - Accumulated depreciation) / estimated useful life of the asset ]
The depreciation expense per year on this asset is,
Depreciation expense = 2 * [(104000 - 0) / 5]
Depreciation expense for the 1 year(2021) = $41600
As the asset was purchased in September, we will charge a depreciation expense of 4 months.
Depreciation expense for 2021 = 31600 * 4/12 = $13866.67
Accumulated depreciation at the end of 2021 = $13866.67
Depreciation expense for 2nd year (2022) = 2 * [(104000 - 13866.67) / 5]
Depreciation expense for 2nd year (2022) = $36053.33
Accumulated depreciation at the end of 2022 = 13866.67 + 36053.33
Accumulated depreciation at the end of 2022 = $49920
To calculate the gain or loss on disposal, we need to determine the Net Book value of the asset at the end of 2022 and compare it with the cash received from the sale. If the cash received is more than the Net Book Value, there is a gain on disposal and if the cash received is less than the Net Book Value, there is a loss on disposal.
Net Book value at the end of 2022 = 104000 - 49920 = $54080
Loss on disposal = 54000 - 54080 = - $80 (loss on disposal)
The loss on the sale of the asset is $2,160.
There would be a loss on the sale of the asset is the book value of the asset is greater than the selling price of the asset.
Depreciation is a method used to reduce the carrying value of an asset.
Double declining depreciation = (2/ useful life) x cost of the asset
Depreciation expense in 2021 = (2/5) x $104,000 = $41,600
3/12 x $41,600 = $10,400
Book value in 2021 = $104,000 - $10,400 = $93,600
Depreciation expense in 2022 = (2/5) x $93,600 = $37,440
Book value in 2022 = $93,600 - $37,440 = $56,160
Loss = $56,160 - $54,000.= $2,160
To learn more about depreciation, please check: https://brainly.com/question/25887124
Cash Flow Ratios Tracy Company reports the following amounts in its annual financial statements:_________.
Cash flow from operating activities $90,000 Capital expenditures $31,000*
Cash flow from investing activities (70,000) Average current assets 80,000
Cash flow from financing activities (10,000) Average current liabilities 60,000
Net income 44,000 Total assets 180,000
* This amount is a cash outflow.
a. Compute Tracy's free cash flow.
b. Compute Tracy's operating-cash-flow-to-current-liabilities ratio.
c. Compute Tracy's operating-cash-flow-to-capital-expenditures ratio.
Answer: a. $59,000. b. 1.5x. c. 2.9x
Explanation:
a) Tracy's Free cash flow will be calculated as:
= Cashflow from operating activities - Capital expenditures
= $90000 - $31000
=$59000
b) Tracy's operating cash flow to current liabilities ratio will be:
Operating cashflow ÷ Current liabilities
= $90000 ÷ $60000
= 1.5x
c) Tracy's operating cashflow to capital expenditures ratio will be:
= Operating cashflow ÷ capital expenditure
= $90000 ÷ $31000
= 2.90x
Pelzer Printing Inc. has bonds outstanding with 10 years left to maturity. The bonds have a 9% annual coupon rate and were issued 1 year ago at their par value of $1,000. However, due to changes in interest rates, the bond's market price has fallen to $950.70. The capital gains yield last year was -4.93%. What is the yield to maturity
Answer:
The answer is 9.85%
Explanation:
The number of periods N = 9years(10 years minus 1 year ago)
Yield to Maturity (I/Y) = ?
Present value of the bond (PV) = $950.70
Future value of the bond(FV) = $1,000
Annual payment (PMT) = $90 (9% x $1,000)
Using a financial calculator to solve the problem ( BA II plus Texas instruments):
Yield to Maturity (I/Y) = 9.85%
Financial data for Joel de Paris, Inc., for last year follow: Joel de Paris, Inc. Balance Sheet Beginning Balance Ending Balance Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets $ 130,000 $125,000 471,000 484,000 870,000 434,000 250,000 $ 2,562,000 2,634,000 341,000 562,000 877,000 399,000 253,000 Liabilities and Stockholders' Equity Accounts payable Long-term debt Stockholders' equity Total liabilities and stockholders' equity $ 383,000 336,000 1,018,000 1,280,000 $ 2,562,000 2,634,000 1,018,000 1,161,000 Joel de Paris, Inc. Income Statement Sales Operating expenses Net operating income Interest and taxes: $ 5,404,000 4,593,400 810,600 Interest expense Tax expense ş 114,000 209,000 323,000 $ 487,600 Net income The company paid dividends of $368,600 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%
Required:
1. Compute the company's average operating assets for last year
2. Compute the company's margin, turnover, and return on investment (ROl) for last year. (Round "Margin", "Turnover" and "ROI" to 2 decimal places.)
3. What was the company's residual income last year?
Answer:
1. $1,930,000
2. Margin = 15%
Turnover = $2.8
Return on investment = 42%
3. $521,100
Explanation:
1. The computation of average operating assets for last year is shown below:-
Average operating assets = (Beginning operating assets + Ending operating assets) ÷ 2
= ($2,562,000 - $399,000 - $253,000) + ($2,634,000 - $434,000 - $250,000) ÷ 2
= ($1,910,000 + $1,950,000) ÷ 2
= $3,860,000 ÷ 2
= $1,930,000
2. The computation of company's margin, turnover, and return on investment is shown below:-
Margin = Net operating income ÷ Sales
= $810,600 ÷ $5,404,000
= 15%
Turnover = Sales ÷ Average operating assets
= $5,404,000 ÷ $1,930,000
= $2.8
Return on investment = Margin × Turnover
= 15% × $2.8
= 42%
3. The computation of residual income last year is shown below:-
Residual income last year = Net operating income - Minimum required return
= $810,600 - ($1,930,000 × 15%)
= $810,600 - $289,500
= $521,100
So, we have applied the above formula.
According to WSJ article, companies like Apple, Deere, and Walt Disney recently issued new bonds on the market, totaling $27 billion offering on a single day on Sep. 3. What explains such an increased activity in a corporate bond market
Answer: Fall in Benchmark Interest Rates.
Explanation:
This activity was caused by a Refinancing Drive. Refinancing is when entities get a new loan with a lower interest rate and pay off the older loan with a higher interest rate so that they can pay at the lower rate.
Bond interest rates are usually fixed so when interest rates in a country fall, bond holders don't benefit from that. One option they have to take advantage of that is to go on a Refinancing Drive and issue new bonds at those lower rates and then pay off the older ones.
That is what Apple, Deere, and Walt Disney have done.
James is the landlord of an apartment containing 22 houses which are to be maintained by him and Lily is one of the tenants. In which of the following cases would the tenant be liable for an injury occurring on the leased premises?A) James was negligent in repairing the broken step on which Lily tripped and broke her ankle.B) Lily's nephew cut his finger with the knife that was negligently kept in Lily's kitchen.C) A little child at the apartment almost choked himself by consuming the paint that was chipping off the common wall between Lily's apartment and her neighbor's.D) The entire apartment caught fire and the fire extinguisher could not be used since it was installed only in Lily's rented house and she was out shopping.E) Lily's visitor got into the common lift in the apartment that suddenly crashed leading to severe injuries to Lily's visi
Answer: B) Lily's nephew cut his finger with the knife that was negligently kept in Lily's kitchen.
Explanation:
James as the landlord will be responsible for the structural or other defects of the house so long as it is the house that is the problem.
Activities that go on inside a tenants house that are caused by the actions of the tenants will not be a liability on the path of the landlord.
If an elevator is damaged or there weren't enough fire extinguishers or there was a broken step or poor quality paint was used, these are all defects related to the house itself and as such will result in negligence on the part of the landlord.
A child getting injured by a knife that Lily as a tenant left, in her apartment will.be the fault of Lily and the negligence can only be on her because it was due to actions by her as a tenant in her leased property.
David Douglas, an announcer from local WTJM radio, has approached you with an exciting offer. He is planning to interview a popular touring group on his radio show next week, and he would like to conduct the interview in your cafe. David would bring all the equipment and promote the event. He explains, "It would bring a lot of business to the cafe, and you would not have to do anything. I am very experienced in promoting and organizing events and would only charge you $250 to take care of it all! I promise you that your sales will increase at the event. Are you interested
Answer:
Yes interested in the offer of David Douglas
Explanation:
The David Douglas is an announcer on radio. It has viewership and audience listens to him. If the interviews are conducted with popular touring group at our cafe it will boost sales of cafe and good customer service will result in words of mouth marketing of cafe. Projected sales will be nearly $11,298 and after deducting the expenses the profit will be nearly $1200. This is an opportunity to promote cafe sales and should accept the offer.
Degregorio Corporation makes a product that uses a material with the following direct material standards:
Standard quantity 3.7 kilos per unit
Standard price $5 per kilo
The company produced 6,300 units in November using 23,780 kilos of the material. During the month, the company purchased 25,950 kilos of the direct material at a total cost of $124,560. The direct materials purchases variance is computed when the materials are purchased.
The materials quantity variance for November is:
A. $2,350 F
B. $2,256 F
C. $2,350 U
D. $2,256 U
Answer:
Materials quantity variance = $2,350 F
Explanation:
Given:
Standard quantity = 3.7 kilos per unit
Standard price = $5 per kilo
Unit produced = 6,300
Total material = 23,780
Computation:
Materials quantity variance = (Actual quantity × Standard price) - (Standard quantity × Standard price)
Materials quantity variance = (23,780 × $) - (6,300 × 3.7 × $5)
Materials quantity variance = $118,900 - $116,550
Materials quantity variance = $2,350 F
The net income reported on the income statement for the current year was $261000. Depreciation was $39900. Account receivable and inventories decreased by $11800 and $34900, respectively. Prepaid expenses and accounts payable increased, respectively, by $1100 and $8300. How much cash was provided by operating activities?
Answer:
$ 354,800.00
Explanation:
The net cash amount provided by operating activities in the year is determined by adding depreciation to net income as well as the decrease in both accounts receivable and inventories.
There is also the need to to deduct increase in prepaid expenses and add the increase in accounts payable as done below:
net cash provided by operating activities=$261,000+$39,900+$11,800+$34,900-$1,100+$8,300=$354,800.00
2. Which of the following is an example of the globalization of production? a. Pepsico sells the same brand of pringles in multiple markets but with flavors talilored to local tastes. b. The World Trade Organization forces Venezuela to change its gasoline grade to conform to the US Clean Air Act. c. Ford manufactures a car in Michigan, but uses parts sourced from 27 countries. d. All of the above.
Answer: Ford manufactures a car in Michigan, but uses parts sourced from 27 countries
Explanation:
Globalization is the process by which businesses or organizations develop international influence or a situation whereby they start operating on international scale.
Globalization of production has to do with the producers of final finished goods relocating and moving to other parts of the world in order to source for the necessary raw materials or equipments needed to complete a product and assemble all of them at their facility.
Based on this definition, Ford manufactures a car in Michigan, but uses parts sourced from 27 countries is the right answer.
Answer: c. Ford manufactures a car in Michigan, but uses parts sourced from 27 countries
Explanation:
Globalization of production entails when companies source or gather best materials or services from other countries in order to incorporate it to the manufacturing or establishment of the final product in another country so as to get the best reduced cost in production with best materials or services.
Ford manufactures a car in Michigan, but uses parts sourced from 27 countries follows the Globalization of production.
You would like to invest in one of the profitable business units of a multinational corporation. In a meeting with management, you explain that you'll only consider a unit categorized, according to the BCG matrix, as a question mark. Here are your choices:Unit A has revenue of $27 billion and a profit of $6 billion. While its product is based on a new technology that is rapidly increasing in sales, the product currently lags the market share of competitors.Unit B has revenue of $30 billion and a profit of $7 billion. Its market share is strong and growing. While its product is based on an outdated technology, the product has a loyal following for now.Which of the corporation's two profitable units meets your criterion?
Answer:
Unit A has revenue of $27 billion and a profit of $6 billion. While its product is based on a new technology that is rapidly increasing in sales, the product currently lags the market share of competitors.
Explanation:
According to the BCG Matrix, question marks are business units that operate in rapidly growing markets but currently only possess a low market share.
This results in a lot of cash being consumed by the business unit, but also the possibility of high growth. It is called a question mark because it is uncertain if the business unit will be successful or not. This means that they are very risky investments.
Which of the following statements about pricing is true? Small changes in price can have big effects on company profit but not on the number of units sold. Small changes in price can have big effects on the number of units sold but not on company profit. Small changes in price can have big effects on the number of units sold and also on company profit. Compared to the other 4P’s, pricing is important because once an item has been priced, changing its price can be quite difficult.
Answer:
Small changes in price can have big effects on the number of units sold and also on company profit
Explanation:
Small change in price will definitely have an effect on the amount of units sold due to a corresponding change in demand that will follow this change, and also will affect the amount of profit that the company generates. This changes can either be positive or negative to the company. Example is the increase in price of coca-cola might trigger customers into switching to pepsi-cola, resulting in a reduced demanded quantity which means less units are produced. The overall effect of these will leave the company with less profit.
Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.10 (given its target capital structure). Vandell has $8.67 million in debt that trades at par and pays an 7.3% interest rate. Vandell’s free cash flow (FCF0) is $1 million per year and is expected to grow at a constant rate of 6% a year. Both Vandell and Hastings pay a 40% combined federal and state tax rate. The risk-free rate of interest is 6% and the market risk premium is 7%. Hastings Corporation estimates that if it acquires Vandell Corporation, synergies will cause Vandell’s free cash flows to be $2.5 million, $3.2 million, $3.5 million, and $3.57 million at Years 1 through 4, respectively, after which the free cash flows will grow at a constant 6% rate. Hastings plans to assume Vandell’s $8.67 million in debt (which has an 7.3% interest rate) and raise additional debt financing at the time of the acquisition. Hastings estimates that interest payments will be $1.5 million each year for Years 1, 2, and 3. After Year 3, a target capital structure of 30% debt will be maintained. Interest at Year 4 will be $1.465 million, after which the interest and the tax shield will grow at 6%. Indicate the range of possible prices that Hastings could bid for each share of Vandell common stock in an acquisition. Round your answers to the nearest cent. Do not round intermediate calculations.
The bid for each share should range between $ ______ per share and $ _______ per share.
Answer:
$40.79 per share and $52.90 per share
Explanation:
Cost of Debt (Kd) = Wd * Rd (1 - T)
Cost of Debt for Vandell Corporation is $7.30 * (1 - 0.40) = 4.38%
Cost of Equity (Ke) = Rf + [tex]\beta[/tex] * Rp
Cost of Equity for Vandell Corporation is 6 + 1.10 * 7 = 13.70%
Weighted Average Cost of Capital (WACC) = Wd * Kd + We * Ke
Cash Flow of Firm = $2.5m + $3.2m + $3.5m + $3.57m = $12.77
Weight of Equity = $8.94
WACC = 30% * 4.38% + 70% * 13.70% = 10.9%
CashFlows after discounting synergy will be = $40.79
Shawn and Harry signed a contract for Shawn to build a house for Harry according to the specifications provided by Harry. The contract stated that Shawn would be paid $125,000. Shawn unintentionally deviated from the specifications in several minor respects. The house was soundly constructed, and Shawn completed the work within the promised time. Harry refused to pay Shawn any of the $125,000, arguing that the house did not conform to the specifications. In this case,
A) Harry will get a decree of specific performance.
B) Shawn has no right to be paid for any of his work because he breached the contract.
C) if the court finds that Shawn has substantially performed, he will be able to recover the contract price less any damages caused by his failure to perform as promised.
D) if the court finds that Shawn has substantially performed, he will be able to recover the contract price less any damages caused to him because of the delay in payment.
Answer:
C) if the court finds that Shawn has substantially performed, he will be able to recover the contract price less any damages caused by his failure to perform as promised.
Explanation:
From the question Harry signed a contract with Shawn to build a house. Harry made some specification to build the house. But Shawn did not follow the specifications now Harry doesn't want to pay him the contract amount.
Under doctrine of specific performance, Harry can pay less money than the contract price. Because Shawn has performed substantially, he is not entitled to receive the contract price as agreed.
You currently have 80 units of a product on the shelf. The demand for the product has been simulated as follows: Demand_Data.xlsx Sales are made to the extent that you have units in stock (for example, if the demand is for 65 units, then 65 units are sold; however, if the demand is for 135 units, then only 80 units are sold). Using the demand data in the attached file, the expected units sold is [a].
Round your answer to a single decimal point. For example, if your answer is 51.456, then round it to 51.5.
Answer:
Hello the required attached file is missing and attached to the answer is the file and the Excel solution to the problem
answer : The expected units sold is ; 65.9
Explanation:
ATTACHED IS THE SOLUTION OF THE PROBLEM USING EXCEL and also attached is the missing file
Demand_Data.xlsx (Following values correspond with each of the 200 rows)
65.2109419609769
36.3814378436655
12.0877429656684
42.5590896559879
82.2785877465503
63.8527707854519
63.4004335955251
15.8457750733942
71.0140411177417
70.8838469511829
17.5017830263823
55.8463070268044
72.5535427994328
83.9481016958598
77.4359377322253
51.6086528880987
61.2436578597408
41.7028003942687
61.3092779024737
57.1605268708663
63.4424295133795
105.393077268964
42.3098881077021
72.9272996471264
73.4634922485566
92.1699337998871
73.9350879887934
62.634502632427
75.1440792958601
78.2438873505453
132.73330654949
56.5183781366795
83.8099039759254
85.089108273969
79.8164036899107
87.0501152751967
41.0291376686655
63.5085725155659
84.9410880112555
59.0508206590312
56.5433210288757
59.7236421020352
65.8728722049273
73.6344772524899
49.9832039570902
47.852667143452
92.3204551730305
74.595608515956
66.5629058351624
32.4733391101472
97.4920239462517
74.2992041926482
9.96752891689539
85.1971107698046
110.769009501673
69.4912286638282
118.182118916884
80.9065695141908
66.242581801198
74.6631839722977
94.2071109823883
89.928620531573
59.5205746724969
104.95497367112
63.1786987872329
113.474574340507
47.0437170809601
79.1452875494724
82.0594904728932
45.6039869680535
97.7821527561173
65.7133240968687
58.5785200604005
84.1517375595868
41.9052539148834
63.9809640636668
78.9487002696842
85.280966181308
61.2992052486516
49.7980308358092
67.0680619298946
49.0870788274333
60.8445261098677
68.4155920174089
91.2059148907429
54.3580098968232
44.4463366369018
66.7196345096454
59.9047907092609
41.6861111664912
40.0889020459726
58.9671926212031
56.350849212613
65.2880671116873
75.5627424444538
48.9305093145231
35.4057319276035
71.0829808161361
32.9006197210401
86.8856786331162
77.7846607382526
104.655840863707
106.356141208671
48.7940851092571
72.7866462914972
61.3815372565296
95.9817170444876
51.57595655357
87.819729691837
85.2932898345171
27.4374669464305
52.1301571500953
79.2558366304729
82.1587163448567
97.4762896879111
42.4961980973603
78.3406121120788
62.3225004749838
69.8783550836379
69.651913640264
68.1852624841849
63.8094333629124
72.8979229682591
71.9960907593486
78.7327634901158
77.8358425525948
59.3799213168677
102.537536753807
75.808078640257
47.8837263875175
65.2613052300876
66.4013113640249
61.8226876616245
79.575478543411
91.3108705793275
96.5802555077244
32.6323187840171
63.5827418084955
42.1373114880407
76.5624135459075
89.248909666203
76.6884695115732
79.5514678832842
77.5245679909131
69.5065309121856
109.253427530639
61.218396644399
84.3726992973825
79.2933305495535
77.684093361604
9.07986208796501
65.9900151225156
67.2133537085028
97.0921646006173
55.312570061069
74.2412921175128
78.6738964455435
58.1307985560852
70.8149299901561
50.1941612531664
102.560546969762
69.0012838679832
71.4907982404111
107.142126529943
88.3843440026976
68.1837390805595
60.2680883678841
86.1327989189886
80.9313987195492
48.4910414746264
43.4493030700833
72.7449459594209
70.5454921847559
55.8600403968012
92.95628291904
50.2714683028171
56.9870862312382
127.145371101797
69.4912286638282
118.879155656323
80.3445017884951
119.5754648
54.8273546376731
76.6189386416227
57.2600028538727
94.6262061409652
80.7842652141699
88.6095803655917
59.0686012804508
64.1408532322384
53.0245542398188
55.6273007026175
101.024046620587
46.6278051538393
105.879475035472
113.218460632488
77.5130628829356
93.539587346022
89.7584540728712
71.5537125364062
Effect of Omitting Adjustments For the year ending April 30, Mann Medical Services Co. mistakenly omitted adjusting entries for (1) $9,200 of supplies that were used, (2) unearned revenue of $12,000 that was earned, and (3) insurance of $2,500 that expired. Indicate the combined effect of the errors on (a) revenues, (b) expenses, and (c) net income for the year ended April 30. (a) Revenues understated $ (b) Expenses $ (c) Net income $
Answer:
(a) Revenues overstated $12,000
(b) Expenses understated $11,700
(c) Net income overstated $300
Explanation:
First prepare the journal entries pertaining to the omitted adjusting entries as follows;
Entry 1
Supplies Expense $9,200 (debit)
Supplies $9,200 (credit)
Entry 2
Revenue $12,000 (debit)
Unearned Revenue $12,000 (credit)
Entry 3
Insurance Expense $2,500 (debit)
Prepaid Insurance $2,500 (credit)
Then consider the Effects on the named Accounts
Expenses.
Affected by Entry 1 and Entry 3
Expenses are understated by $11,700
Revenues.
Affected by Entry 2.
Revenues are overstated by $12,000
Net Income
Affected by Entries 1, 2, 3 also the net effect of the two items above.
Income is overstated by $300
A company reported total assets at the end of 2017 of $95,000; including cash of $35,000, accounts receivable of $20,000, and inventory of $40,000. It reported total assets at the end of 2018 of $110,000; including cash of $44,000; accounts receivable of $29,000, and inventory of $37,000. Compute the net increase or decrease in cash in 2018. Decrease of $9,000 Increase of $15,000 Increase of $9,000 Decrease of $15,000
Answer:
The correct option is increase of $9,000
Explanation:
The increase or decrease in cash in 2018 could be determined by using the formula below which is coined from the statement of cash flow:
Cash at the end of the year=cash at the beginning plus +increase in cash
cash at the end of 2018 is $44,000 whereas cash at the beginning which is the same at closing balance of 2017 is $35,000
$44,000=$35,000+increase in cash
increase in cash =$44,000-$35,000
increase in cash in 2018=$9,000
Required information The Foundational 15 [LO5-1, LO5-3, LO5-4, LO5-5, LO5-6, LO5-7, LO5-8] [The following information applies to the questions displayed below.] Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 20,000 Variable expenses 12,000 Contribution margin 8,000 Fixed expenses 6,000 Net operating income $ 2,000 Foundational 5-11 11. What is the margin of safety in dollars
Answer:
$5,000
Explanation:
Sales $20,000
Variable expenses $12,000
Contribution margin $8,000
Fixed expenses $6,000
Net operating income $2,000
margin of safety in $ = current sales level - break even point
margin of safety in % = (current sales level - break even point) / current sales level
first we need to calculate the contribution margin per unit = $20 - $12 = $8 per unit
break even point = fixed costs / contribution margin = $6,000 / $8 = 750 units
sales level at break even point = 750 x $20 = $15,000
margin of safety in $ = $20,000 - $15,000 = $5,000
margin of safety = ($20,000 - $15,000) / $20,000 = $5,000 / $20,000 = 25%
Cooperton Mining just announced it will cut its dividend from $4.17 to $2.56 per share and use the extra funds to expand. Prior to the announcement, Cooperton's dividends were expected to grow at a 3.3 % rate, and its share price was $50.47. With the planned expansion, Cooperton's dividends are expected to grow at a 46% rate. What share price would you expect after the announcement? (Assume that the new expansion does not change Cooperton's risk). Is the expansion a good investment?
Answer: New share price= Price = $35.38. No, it's not a good investment
Explanation:
First, we have to calculate the cost of equity.
Price = Dividend/r - g
Dividend = $4.17 × (1 + 3.3%)
= $4.17 × (1 + 0.033)
= $4.17 × 1.033
= $4.30761
Price = Dividend/r - g
50.47 = 4.30761/r - 0.033
r - 0.033 = 4.30761/50.47
r - 0.033 = 0.08535
r = 0.08535 + 0.033
r = 0.11835
Now, we have to calculate the new price with dividend of $2.56 and g= 4.6%.
Price = Dividend/r - g
Price = 2.56/0.11835 - 0.046
Price = 2.56/0.07235
Price = $35.38
The expansion isn't a good investment because the stock price is s reduced from $50.47 to $35.38
The following data have been recorded for recently completed Job 323 on its job cost sheet. Direct materials cost was $2,063. A total of 33 direct labor-hours and 234 machine-hours were worked on the job. The direct labor wage rate is $18 per labor-hour. The Corporation applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $24 per machine-hour. The total cost for the job on its job cost sheet would be:
Answer:
$8,723
Explanation:
Calculation for total cost for the job on its job cost sheet
Direct materials 2,063
Direct labor (33 hours × $18 per hour) 594
Manufacturing overhead (234 hours × $24 per hour) 5,616
Total manufacturing cost for job 8,273
A roofing company collects fees when jobs are complete. The work for one customer, whose job was bid at $3,900, has been completed as of December 31, but the customer has not yet been billed. Assuming adjustments are only made at year-end, what is the adjusting entry the company would need to make on December 31, the calendar year-end?
Answer:
Debit Accounts Receivable, $3,900;
Credit Roofing Fees Revenue, $3,900
Explanation:
Here, no cash transaction was involved. Since the job has been completed but the customer has not been billed yet, this simply means it has to be debited with accounts receivable, which is recognised as current asset and recognised as revenue for the period, hence needs to be credited.
This means that accounts receivable has to be debited with the amount of $3,900 while roofing fees revenue has to be credited with the amount of $3,900
Considering the above, the adjusting entry the company would need to make on December 31, the calendar year-end would be:
Debit Accounts Receivable, $3,900;
Credit Roofing Fees Revenue, $3.900
Data for Sedgwick Company are presented in E12.8. Sedgwick Company now decides to liquidate the partnership. Instructions Prepare the entries to record: (a) The sale of noncash assets. (b) The allocation of the gain or loss on realization to the partners. (c) Payment of creditors. (d) Distribution of cash to the partners.
Complete Question:
Sedgwick Company at December 31 has cash $22,800, noncash assets $108,000, liabilities $57,800, and the following capital balances: Floyd $43,200 and DeWitt $29,800. The firm is liquidated, and $113,000 in cash is received for the noncash assets. Floyd and DeWitt income ratios are 70% and 30%, respectively. Sedgwick Company now decides to liquidate the partnership. Prepare the entries to record: (Credit account titles are automatically indented when amount is entered. Do not indent manually.) (a) The sale of noncash assets. (b) The allocation of the gain or loss on realization to the partners. (c) Payment of creditors. (d) Distribution of cash to the partners.
Answer:
The entries are given below alongwith its explanation:
Explanation:
Part A. As the Non Cash Assets are sold at gain $5000 (113k-108k), the entry would be as under:
Dr Cash 113000
Cr non cash asset 108000
Cr Gain on sale of asset 5000
Part B. The entry to record the allocation of the gain to partners Floyd and Dewitt at 70:30 respectively.
Dr Gain on sale of asset $5000
Cr Floyd capital ($5000 * 70%) $3500
Cr Dewitt capital ($5000 * 30%) $1500
Part C. The payment of the liabilities by cash receipt of selling the capital would be as under:
Dr Liabilities $57800
Cr Cash $57800
Part D. The amount left (capital) after paying off the liabilities would be distributed among the partners at capital ratio.
Dr Floyd capital $46,700 (43200 70% +3500 Gain)
Dr Dewitt capital $31,300 (29800 30% +1500 Gain)
Cr Cash $78,000
g A statement describing how the world is a. is a normative statement. b. is a positive statement. c. would only be made by an economist speaking as a policy adviser. d. would only be made by an economist employed by the government.
Answer:
b. is a positive statement
Explanation:
Positive statements describes what is and not ones personal opinion or value judgements.
An example of a positive statment is when prices increase, demand falls.
A normative statement describes value judgement and it is not based on empirical evidence.
An example of a normative statment is the government ought to increase prices of junk food so people can eat more healthy food.
I hope my answer helps you
Mostert Music Company had the following transaction inMarch:a. Sold instruments to customers for $10,000; received$ 6,000 in cash and the rest on account.The cost of theinstruments was $7,000.
b.Purchased $4,000 of new instruments inventory; paid$1,000 in cash and owed the rest on account.
c. Paid $600 in wages for the month.
d. Received a $200 bill for utilities that will be paidin April.
e. Received $1,000 from customers as deposits on ordersof new instruments to be sold to the customers in April.Complete the following statement:Cash BasisIncomeStatementAccrualBasis Income StatementRevenues:Revenues:CashSales___________Salesto customers_________Customerdeposits___________Expenses:Expenses:Inventorypurchases__________Costof sales__________Wagespaid__________Wagesexpense__________Utilitiesexpense__________CashIncome___________(dbl underline)Netincome_________(dbl underline)
Answer: The answer is given below
Explanation:
It should be noted that for the cash basis income statement, the revenue were cash sales of $6000 and customer deposit of $1000 making a total of $7000. The expenses were the inventory purchased of $1000 and the wages paid of $600 making $1600. Cash income was now:
= $7,000 - $1600
= $5400
For the accrual income statement, the revenue was $10000 and expenses were $7800. The cash Income was now: $10,000 - $7800 = $2,200
Check the attachment for further clarification.
The Eastern District of Adelson Inc. is organized as a cost center. The budget for the Eastern District of Adelson Inc. for the month ended December 31 is as follows:
Sales salaries $819,840
System administration salaries 448,152.00
Customer service salaries 152,600.00
Billing salaries 98,760.00
Maintenance 271,104.00
Depreciation of plant and equipment 92,232.00
Insurance and property taxes 41,280.00
Total $1,923,968.00
During December, the costs incurred in the Eastern District were as follows:
Sales salaries $818,880.00
System administration salaries 447,720.00
Customer service salaries 183,120.00
Billing salaries 98,100.00
Maintenance 273,000.00
Depreciation of plant and equipment 92,232.00
Insurance and property taxes 41,400.00
Total $1,954,452.00
Required:
Prepare a budget performance report for the manager of the Eastern District of Adelson for the month of December.
Answer:
Eastern District: Adelson Inc.
Budget Performance Report
For the Year Ended December 31, XX
Actual Static Variance
results budget
Sales salaries $818,880 $819,840 -$960
System adm. salaries $447,720 $448,152 -$432
Customer service salaries $183,120 $152,600 $30,520
Billing salaries $98,100 $98,760 -$660
Maintenance $273,000 $271,104 $1,896
Depreciation of P & E $92,232 $92,232 $0
Insurance and prop. taxes $41,400 $41,280 $120
Total $1,954,452 $1,923,968 $30,484
Explanation:
A budget performance report shows how the actual costs and/or revenues perform according to the planned budget. A negative sign on the variance column shows a favorable variance (lower costs or higher revenues), while a positive sign shows an unfavorable variance (higher costs or lower revenues).
Lang Warehouses borrowed $287,610 from a bank and signed a note requiring 15 annual payments of $27,709 beginning one year from the date of the agreement. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Required: Determine the interest rate implicit in this agreement
Answer:
The interest rate implicit in this agreement is 5%
Explanation:
A fix periodic payment made for a specific of time is known as annuity.
The 15 annual loan payment of $27,709 is an annuity payment and we will use the following formula to calculate the interest rate.
PV of annuity = P x annuity factor
Where
P = annual payments = $27,709
Placing values in the formula
$287,610 = $27,709 x annuity factor
Annuity factor = $287,610 / $27,709
Annuity factor = 10.37966
The annuity factor of 10.37966 for 15 years is for 5% interest rate.
One person owns a company's bond, and another owns a share of stock. The company makes a profit of $50 during a certain year. The bondholder is owed a coupon payment of $50, and the stockholder is promised a dividend of $50.
Which of the following is the likeliest outcome of this situation?
a) The bondholder is paid $50
b) The stockholder is paid $50
c) Each investor is paid $25
d) The company keeps the $50 as retained earnings
e) None of these outcomes are likely to happen
2) Assume you bought a share of stock a year ago at a certain price, and today you need the money, so are forced to sell it even though the price has decreased.
Which of the following statements is true?
a) The stock's dividend yield is negative.
b) The stock's dividend yield is positive.
c) The stock's capital gains yield is negative.
d) The stock's capital gains yield is positive.
e) The stock's current yield is negative.
Answer:
The correct option for the first question is A,the bondholder is paid $50
The correct option for the second question is C,the stock's capital gains yield is negative
Explanation:
The company has to pay the $50 owed to bondholder as payment of coupon payment takes precedence over payment of dividends.
It would be inappropriate to keep the $50 in retained earnings since there is a covenant in the agreement signed with bondholders that their coupon payment annually is mandatory.
The correct answer to the second question is that the stock's capital gains yield is negative.
Capital gains yield =the price now(which is lower)-original price/original price
Since the numerator would give a negative figure,overall yield is negative
You have been asked by management to explain the variances in costs under your inpatient capitated contract. The following data is provided. Use the following data to calculate the variances.
Budget Actual
Inpatient Costs $12,568,500 $16,618,350
Members 42,000 42,000
Admission Rate 0.070 0.095
Case Mix Index 0.90 0.85
Cost per Case (CMI = 1.0) $4,750 $4,900
Problem 1: What dollar amount of the total variance is attributed to Enrollment Variance?
Problem 2: What dollar effect did the increased admission rate have on cost?
Problem 3: The intensity of care delivered dropped from a budgeted case mix of 0.90 to an actual case mix of 0.85. What dollar effect did this have on actual costs?
Problem 4: Costs per case increased to $4,900 from a budgeted value of $4,750. This increased actual total costs by what amount?
a) $400,000
b) $570,000
c) $970,000
d) $600,000
e) cannot calculate with given information
Find the given attachment
