:
.
Explanation:
the reason maintenance cost are low is because the airline has just one type of aircraft which is boeing 737.
a. the measurable dependent variable for the study is the fares of the southwast airlines.
b. a factor that might affect the independent variable is the three versions that are being used by the southwest airlines. the independent variable here is the maintenance cost of the airlines. the factor has 3 different levels which are boeing -700, -800, -900ER
thank you!
why is the GDP become the important factors in decision making in the economic policy?
Answer:
see below
Explanation:
GDP is the value of all commodities and services produced within a country's border, in a particular period. Only finished consumer products and services are considered in calculating GDP.
The GDP value is important because
1. GDP reports the state of a country's economy
An increase in GDP indicates growth in the economy. Growth in real GDP value signifies a health economy that creates adequate job opportunities, increasing incomes, and a wealthier nation. A decline in GDP communicates a recession that requires government
intervention.
2. For investment decisions
Investors use GDP as a reference point when making investment decisions. Declining GDP value indicates bad economic conditions, which will result in lower earnings and reduced stock prices. Increasing GDP value is associated with good returns and higher stock prices.
Explain the following statement and answer to corresponding question. It is worth 15 points. "In a competitive model without consideration of space (distance) we would expect competition to lead to identical prices but when we include spatial elements we expect competition to lead to different delivered prices." If individuals have to pay a different price for products because they live a different distance from the factory do you think this is an example of discrimination of prices? Why or why not?
Answer:
In marketing, price discrimination refers to selling the same product to different buyers at different prices depending on each buyer's purchasing power or preferences which result in them being able and willing to pay different prices. E.g. a movie theater that charges different prices depending on the age of the movie goers.
In this case, the fact that a factory is located far away from your house might result in a higher price due to delivery costs, but that doesn't meant that it is using price discrimination. E.g. I just purchased a new refrigerator online and I had to pay a delivery fee that increased its price because the seller is from another state. I purchased the refrigerator from that retailer because it lower prices including delivery costs, but someone that purchased it from the same city will probably pay even less than me. But it is just logistics, since I live far away I have to wait 3 days for delivery and pay for it.
Why should investors know the difference between nominal and real interest rates?
O to know what they are likely to lose
O to understand changes in monetary policy
to guarantee an investment's profitability
O to recognize the effects of inflation
Answer:
to recognize the effects of inflation
Explanation:
The nominal rate of interest is the interest earned before adjusting for inflation. The nominal interest rate is simple to recognize and calculate. It is the rate quoted on loans, deposits, bonds, and mutual funds. The nominal rate communicates to the investor the percentage of returns to expect from their investment. The higher the percentage, the better the returns. However, nominal interest does not take account of inflation.
Inflation erode the purchasing power of money. A high inflation rate will mean that any investment gains may not benefit the investor as the currency will have weakened. The real interest rate considers inflation rates. It tells the investor the actual gain from an investment after adjusting for inflation.
Answer:
To recognize the effects inflation.
Explanation: This is the correct answer on edg 2020 (just took the quiz) ^-^
Rhonda owns 50% of the stock of Peach Corporation. She and the other 50% shareholder, Rachel, have decided that additional contributions of capital are needed if Peach is to remain successful in its competitive industry. The two shareholders have agreed that Rhonda will contribute assets having a value of $200,000 (adjusted basis of $15,000) in exchange for additional shares of stock. After the transaction, Rhonda will hold 75% of Peach Corporation and Rachel's interest will fall to 25%. a. What gain is realized on the transaction
Answer:
$185,000
Explanation:
According to the given situation, the computation of gain is shown below:-
Recognized gain = Amount realized—stock - Adjusted basis of property transferred
= $200,000 - $15,000
= $185,000
Therefore, for computing the recognized gain we simply applied the above formula.
Hence, the gain realized on the transaction is $185,000
Linden, Inc. uses a 6,900 square foot factory space that it rents for $3,500 a month for all its manufacturing activities. Linden has decided to switch to an activity-based costing system, and has identified its activities as follows: Preparation and Setup, Machining, Finishing, and Quality Control. 3,100 square feet of the factory are used for machining, while 1,400 square feet (each) are used for Preparation and Setup and Quality Control. Finishing uses 1,000 square feet. When assigning indirect costs to each activity, how much factory rent should be assigned to the Preparation and Setup cost pool
Answer: $710.14
Explanation:
Out of the total space of 6,900 square foot, Preparation and Setup uses 1,400 out of this.
Rent is $3,500
The total rent to be apportioned to it will therefore be;
= 1,400/6,900 * 3,500
= $710.14
Here are data on two stocks, both of which have discount rates of 18%: Stock A Stock B Return on equity 18 % 15 % Earnings per share $ 4.60 $ 2.90 Dividends per share $ 2.30 $ 2.30 a. What are the dividend payout ratios for each firm? (Enter your answers as a percent rounded to 2 decimal places.) b. What are the expected dividend growth rates for each stock? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) c. What is the proper stock price for each firm? (Do not round intermediate calculations. Round your answers to 2 decimal places.)
Answer:
a. What are the dividend payout ratios for each firm?
payout ratio stock A = $2.30 / $4.60 = 0.5 = 50%payout ratio stock B = $2.30 / $2.90 = 0.7931 = 79.31%b. What are the expected dividend growth rates for each stock?
growth rate stock A = 0.18 x (1 - 50%) = 0.09 = 9%growth rate stock B = 0.15 x (1 - 79.31%) = 0.031035 = 3.10%c. What is the proper stock price for each firm?
stock A's proper price = $2.507 / (0.18 - 0.09) = $27.86stock B's proper price = $2.3713 / (0.18 - 0.031) = $15.91Explanation:
dividend payout ratio = dividend / EPS
growth rate = ROE x (1 - dividend payout ratio)
P₀ = Div₁ / (Re - g)
Use the following data to compute total manufacturing costs for the month:
Sales commissions $ 11,800
Direct labor 40,600
Indirect materials 16,200
Factory manager salaries 8,200
Factory supplies 10,000
Indirect labor 7,300
Depreciation—office equipment 6,000
Direct materials 41,500
Corporate office salaries 43,500
Depreciation—factory equipment 8,500
a) $150,100.
b) $132,300.
c) $50,200.
d) $90,800.
e) $61,300.
Answer:
$132,300
Explanation:
The total manufacturing costs for the month can be calculated as follows
Direct labor + indirect materials + factory manager salary + indirect labour + direct materials + depreciation on factory equipment
= 40,600 + 16,200 + 8,200 + 10,000 + 7,300 + 41,500 + 8,500
= $132,300
Hence the total manufacturing costs if $132,300
The city of Ashkelon, on the eastern end of the Mediterranean Sea, is one of the major cities of the Philistines. A powerful merchant family (known henceforth as The Family) of this city has to decide how to allocate its vast but finite resources to further their own wealth and the glory and influence of their state. Some trade routes use camel caravans and go to the southern deserts, where they may trade in salt and gold with the great inland African nations; others may go north and west, oversea by galley, toward the Greeks; others may push their foul-mouthed, humped mounts east, overland toward Sumeria, to trade in spices and the crafted goods specific to that region. Some of the routes are over more arduous terrain than others, so make take longer to pay off (no revenue is realized by The Family until the caravan returns to Ashkelon). The financial costs and returns of each route are as follows (in Phils, the currency of the Philistines:
Route Costs,Period 0 Revenue, Period1 Revenue, Period 2 Revenue, Period 3
African Route - 75,000 215,000
Greek Route - 50,000 140,000
Sumerian Route -125,000 385,000
Costs are incurred at the end of year zero, and revenues accrue at the end of Periods 1, 2, and 3, for each respective route (for instance, the African caravan returns at the end of period two, at which time its revenue is realized). The discount rate for the shipping company is 5%.
a. Calculate the NPV, B/C ratio, Payback period, and IRR for each route option
b. Rank the route options according to NPV, B/C ratio, Payback period, and IRR
c. If the company had unlimited funds, which trade routes would you recommend the family pursue? Why? Be sure to consider all combinations of routes, including multiple caravans on the same trade route
d. Given that the family can only invest 150,000 Phils, which combination of trade routes would you recommend pursuing? Why?
Answer:
African Route costs = -75,000, period 1 revenues = 215,000
Greek Route costs = -50,000, period 2 revenues = 140,000
Sumerian Route costs = -125,000, period 3 revenues = 385,000
discount rate = 5%
a) African route:
NPV = -75,000 + 215,000/1.05 = 129,762
B/C ratio = 215/75 = 2.87
Payback = 1 period
IRR = 187%
Greek route:
NPV = -50,000 + 140,000/1.05² = 76,984
B/C ratio = 140/50 = 2.8
Payback = 2 periods
IRR = 67%
Sumerian route
NPV = -125,000 + 385,000/1.05³ = 332,577
B/C ratio = 385/125 = 3.08
Payback = 3 periods
IRR = 45%
b) rank according to:
NPV = Sumerian route, African route, Greek route
B/C ratio = Sumerian route, African route, Greek route
Payback = African route, Greek route, Sumerian route
IRR = African route, Greek route, Sumerian route
c) if the family had unlimited resources, they should invest in the 3 routes since all their NPVs are positive.
d) African and Greek routes since they yield the highest gains (IRR).
Peabody, Inc., sells fireworks. The company’s marketing director developed the following cost of goods sold budget for April, May, June, and July. April May June July Budgeted cost of goods sold $79,000 $89,000 $99,000 $105,000 Peabody had a beginning inventory balance of $2,700 on April 1 and a beginning balance in accounts payable of $15,000. The company desires to maintain an ending inventory balance equal to 20 percent of the next period’s cost of goods sold. Peabody makes all purchases on account. The company pays 70 percent of accounts payable in the month of purchase and the remaining 30 percent in the month following purchase. Required a. Prepare an inventory purchases budget for April, May, and June. b. Determine the amount of ending inventory Peabody will report on the end-of-quarter pro forma balance sheet. c. Prepare a schedule of cash payments for inventory for April, May, and June. d. Determine the balance in accounts payable Peabody will report on the end-of-quarter pro forma balance sheet. This is the last question in the assignment. To submit, use Alt + S. To access other questions, proceed to the question map button.Next Visit question mapQuestion 7 of 7 Total7 of 7 Prev
Answer:
Peabody, Inc.
a. Inventory Purchase Budget:
April May June
Budgeted cost of goods sold $79,000 $89,000 $99,000
Add Ending Inventory 17,800 19,800 21,000
Cost of Goods Available 4 Sale $96,800 118,800 120,000
Less Beginning Inventory 2,700 17,800 19,80
Purchases $94,100 $101,000 $100,200
b. The amount of Ending Inventory that Peabody will report on the end-of-quarter proforma balance sheet is:
$21,000
c. A Schedule of Cash Payments for Inventory:
April May June
70% in month of purchase 65,870 70,700 70,140
30% in the month following 15,000 28,230 30,300
Total payment $80,870 $98,930 $100,440
d. Balance of the Accounts Payable is:
$30,060
Explanation:
a) Data and Calculations:
1. Cost of Goods Sold Budget:
April May June July
Budgeted cost of goods sold $79,000 $89,000 $99,000 $105,000
Add Ending Inventory 17,800 19,800 21,000
Cost of Goods Available 4 Sale $96,800 118,800 120,000
Less Beginning Inventory 2,700 17,800 19,800 21,000
Purchases $94,100 $101,000 $100,200
Accounts Payable
Beginning balance $15,000 $28,230 $30,300
Purchases $94,100 $101,000 $100,200
Less payment:
70% in month of purchase 65,870 70,700 70,140
30% in the month following 15,000 28,230 30,300
Ending balance $28,230 $30,300 $30,060
6. Blackberry announces that they are going bankrupt within the next 6 months. What happens to the demand for Blackberry
phones?
When you introduce your product to a focus group or a small geographical location, which activity does it signify?
which adjective best describes you at work? a.unique b.orderly
Answer:
B
Explanation:
being unique can be good at work but making sure you're organized doing your job is vital.
Refer to the following items on the balance sheets of a firm for the years ending December 31, 2018 and 2019.
Item 2018 2019
Accounts Payable $729,500 $917,300
Long Term Debt $1,267,700 $1,093,400
Common Stock ($1 par) $2,184,000 $2,471,300
Retained Earnings $3,227,100 $3,419,800
If the firm's interest expense on its 2019 income statement was $312,920, calculate the net cash flow to the firm's creditors in 2019.
a) $312,920
b) $138,620
c) $425,920
d) $487,220
Answer: d) $487,220
Explanation:
The net cash flow to creditors in 2019 is calculated by the formula;
= Long term debt in 2018 - Long term debt in 2019 + Interest expense in 2019
= 1,267,700 - 1,093,400 + 312,920
= $487,220
For each separate case below, follow the three-step process for adjusting the unearned revenue liability account at December 31
Step 1: Determine what the current account balance equals.
Step 2: Determine what the current account balance should equal
Step 3: Record the December 31 adjusting entry to get from step 1 to step 2.
Assume no other adjusting entries are made during the year a. Tao Co. recelves $10,000 cash in advance for four months of legal services on October 1, 2017, and records it by debiting Cash and crediting Unearned Revenue both for $10,000. It is now December 31, 2017, and Tao has provided legal services as planned. hat adjusting entry should Tao make to account for the work performed from October 1 through December 31, 2017? Unearned revenue
Step 1: Determine what the current account balance equals.
Step 2: Determine what the current account balance should equal
Step 3: Record the December 31 adjusting entry to get from step 1 to step 2 b.
A. Caden started a new publication called Contest News. Its sub subscriber, Caden debits Cash and credits Unearned Subscription Revenue for the amounts received. The company has 100 new subscribers as of July 1, 2017. It sends Contest News to each of these subscribers every month from July through December Assume no changes in subscribers, prepare the journal entry that Caden must make as of December 31, 2017, to adjust the Subscription Revenue account and the Unearned Subscription Revenue account pay $24 to receive 12 monthly issues.
Answer:
1. Assume no other adjusting entries are made during the year a. Tao Co. receives $10,000 cash in advance for four months of legal services on October 1, 2017, and records it by debiting Cash and crediting Unearned Revenue both for $10,000. It is now December 31, 2017, and Tao has provided legal services as planned. hat adjusting entry should Tao make to account for the work performed from October 1 through December 31, 2017?
Step 1: Unearned Revenue has a credit balance of $10,000
Step 2: Unearned Revenue should have a credit balance of $2,500 only.
Step 3: Adjusting Journal Entry:
Debit Unearned Revenue $7,500
Credit Service Revenue $7,500
To record revenue for services performed to December 31, 2017.
2. Caden started a new publication called Contest News. Its sub subscriber, Caden debits Cash and credits Unearned Subscription Revenue for the amounts received. The company has 100 new subscribers as of July 1, 2017. It sends Contest News to each of these subscribers every month from July through December Assume no changes in subscribers, prepare the journal entry that Caden must make as of December 31, 2017, to adjust the Subscription Revenue account and the Unearned Subscription Revenue account pay $24 to receive 12 monthly issues.
Step 1: Unearned Subscription Revenue has a credit balance of $2,400
Step 2: Unearned Subscription Revenue should have a credit balance of only $1,200.
Step 3: Adjusting Journal Entry:
Debit Unearned Subscription Revenue $1,200
Credit Subscription Revenue $1,200
To record subscription revenue for services performed to December 31, 2017.
Explanation:
Tao Co and Caden follow the three-step process of adjusting unearned revenue liability accounts at year-end. The purpose of the steps is to ensure that correct amounts remain as balances in the unearned revenue accounts. The steps also help to adjust the Earned Revenue account to its proper amount in recognition of goods or services provided in accordance with the accrual concept and the matching principle of generally accepted accounting principles.
Crater HVAC Systems is preparing its statement of cash flows (indirect method) for the year ended March 31, 2018. To follow, in no particular order, is a list of items that will be used in preparing the company's statement of cash flows. Identify each item as an operating activity addition to net income; an operating activity subtraction from net income; an investing activity; a financing activity; or an activity that is not used to prepare the cash flows statement. a. Increase in inventory b. Issuance of common stock c. Decrease in accrued liabilities d. Net income e. Decrease in prepaid expense
Answer:
a. Increase in inventory - an operating activity subtraction from net income
This is an operating activity as it has to do with the day to day business of the company and its operations. It is a subtraction from Net income because an increase in inventory means that more cash was spent to buy the inventory.
b. Issuance of common stock - a financing activity
Financing activities are those that have to do with raising capital for the business so when stock is issued and Equity is raised, it is a financing activity.
c. Decrease in accrued liabilities - an operating activity subtraction from net income
Liabilities are also in relation to the firm's operations so they are operating activities. This will be a subtraction from Net income because cash was used to pay off liabilities which is what reduced them.
d. Net income - operating activity addition to net income
Net income is derived from the operations of the business so is an Operating activity. It will increase net income evidently.
e. Decrease in prepaid expense - operating activity addition to net income
Prepaid expense is in relation to expenses which is an operating activity. It will be an addition to net income because as an asset, it reducing means that cash was not paid to acquire it.
motors are packaged for sale in a certain warehouse. The motors sell for $100 each, but a double-your-money-back guarantee is in effect for any defectives the purchaser may receive (i.e. the seller pays buyer $200 for any defective item). Find the expected net gain for the seller if the probability of any one motor being defective is 0.08. (Assume that the quality of any one motor is independent of that of the others.) Show all work by defining the variables of interest and its distributions.
Answer:
$840
Explanation:
the question misses an important detail, number of motors.
I used 10 as the total number of cars. from the solution i believe you would be able to solve any other problem of this sort yourself.
n = 10
p = 1-probability of any 1 motor being defective
= 1-0.08
= 0.92
going further in solving this problem, i will use the binomial distribution
we have expected value as;
Σxp(x)
= $100 x p(of 100) - $100 x p(of losing 100)
= 100(0.92) - 100(0.08)
= 92 - 8
= $84
from here we multiply 84$ by n
remember n = total number of cars = 10
10 x $84
= $840
The following production and average cost data for two levels of monthly production volume have been supplied by a company that produces a single product: Production Volume Component 950 units 750 units Direct materials $17.00 per unit $17.00 per unit Direct labor $39.61 per unit $50.17 per unit Manufacturing overhead $18.08 per unit $20.10 per unit Round your answers to the nearest dollar. Fill in the blank without $ sign or comma or period, e.g., 12345 The approximate total cost to manufacture 850 units is:
Answer:
68204
Explanation:
The computation of total cost is shown below:-
The Total cost of 950 units
= 950 units × (17 + 39.61 + 18.08)
= 950 units × 74.69
= 70955.50
now,
The total cost of 750 units
= 750 units × (17 + 50.17 + 20.10)
= 750 units × 87.27
= 65452.5
So,
Variable cost per unit
= (Total cost at highest activity - Total cost at lowest activity) ÷ (Highest activity - Lowest activity)
= (70955.5 - 65452.50) + (950 units - 750 units)
= 5503 ÷ 200 units
= 27.515 per unit
And
Fixed cost
= Total cost at 750 Units - Variable cost at 750 units
= 65452.5 - (750 × 27.515)
= 65452.5 - 20636.25
= 44816.25
Hence,
Total manufacture cost of 850 units
Total Manufacturing cost = Variable cost + Fixed cost
=(850 × 27.515) + 44816.25
= 23387.75 + 44816.2
= 68204
Which characteristic describes the privatization of Social Security?
A. increases the employer’s contribution to Social Security
B. raises the retirement age to claim full benefits to 70
C. enables Americans to invest their Social Security contributions in the stock market
D. reduces benefits across the board by 13 percent
E. obtains a loan from the Fed
Answer:
the answer is C because it makes sense...
Enables Americans to invest their Social Security contributions in the stock market - describes the privatization of Social Security. Hence option C is correct.
What are the characteristic of the privatization of Social Security?Privatization of Social Security refers to a proposal where individuals are allowed to invest their Social Security contributions into individual retirement accounts (IRAs) or other investments instead of the government-managed Social Security Trust Fund.
Under this system, individuals would have control over their retirement funds and would be able to invest in the stock market, bonds, and other financial instruments. This would also mean that individuals would be responsible for managing their own retirement funds and bearing the associated risks.
Options A and B do not describe privatization but rather refer to potential changes in the current Social Security system. A reduction in benefits, which is not necessarily associated with privatization. Option E is not related to the privatization of Social Security at all, but rather refers to obtaining a loan from the Federal Reserve.
Learn more about privatization here
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Opunui Corporation has two manufacturing departments--Molding and Finishing. The company used the following data at the beginning of the year to calculate predetermined overhead rates:
Molding Finishing Total
Estimated total machine-hours (MHs) 3,250 3,000 6,250
Estimated total fixed manufacturing overhead cost $27,000 $4,700 $31,700
Estimated variable manufacturing overhead cost per MH $ 1.00 $ 2.00
During the most recent month, the company started and completed two jobs--Job A and Job M. There were no beginning inventories. Data concerning those two jobs follow:
Job A Job M
Direct materials $15,900 $ 9,700
Direct labor cost $ 23,000 $ 9,500
Molding machine-hours 1,250 2,000
Finishing machine-hours 1,750 500
Assume that the company uses a plantwide predetermined manufacturing overhead rate based on machine-hours and uses a markup of 30% on manufacturing cost to establish selling prices. The calculated selling price for Job A is closest to: (Round your intermediate calculations to 2 decimal places.)
a) $58,550
b) $99,500
c) $76,115
d) $17,565
Answer:
Results are below.
Explanation:
Giving the following information:
Estimated total machine-hours (MHs)= 6,250
Estimated total fixed manufacturing overhead cost= $31,700
Estimated variable manufacturing overhead cost= (1*3,250 + 2*3,000)= $9,250
Job A
Direct materials $15,900
Direct labor cost $ 23,000
Molding machine-hours 1,250
Finishing machine-hours 1,750
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= (31,700 + 9,250)/6,250
Predetermined manufacturing overhead rate= $6.55 per machine hour
Now, we can calculate the total cost of Job A:
Total cost= 15,900 + 23,000 + 6.55*3,000
Total cost= $58,550
Finally, the selling price for Job A:
Selling price= 58,550*1.3= $76,115
Dewey Corp. is expected to have an EBIT of $2.45 million next year. Depreciation, the increase in net working capital, and capital spending are expected to be $180,000, $85,000, and $185,000, respectively. All are expected to grow at 18 percent per year for four years. The company currently has $13 million in debt and 800,000 shares outstanding. The company’s WACC is 9.1 percent and the tax rate is 21 percent. You decide to calculate the terminal value of the company with the price-sales ratio. You believe that Year 5 sales will be $27.4 million and the appropriate price-sales ratio is 1.9. What is your estimate of the current share price?
Answer:
$41.13
Explanation:
The current share price can be calculated by first deducting the debt from the firm value then divide the equity value by the number of shares outstanding. To calculate the firm value first we need to calculate the free cash flows and after calculating free cashflows we will multiply them with the Compan's WACC to reach the present value of each free cash flow
DATA
EBIT = 2.45m
WACC = 9.1%
Tax rate = 21%
Debt = 13m
Outstanding shares = 800,000
NOTE: Calculations are attached in attachments
Gordon, an employee, is provided group term life insurance coverage equal to twice his annual salary of $125,000 per year. According to the IRS Uniform Premium Table (based on Gordon's age), the amount is $12 per year for $1,000 of protection. The cost of an individual policy would be $15 per year for $1,000 of protection. Since Gordon paid nothing towards the cost of the $250,000 protection, he must include in his 2019 gross income which of the following amounts?
Answer:
1
Explanation:
1+1=2
Hey guys i dont know who to vote for plz give me suggestions and reasons why
Answer:
me ig im just trying to get more points and brainliest
Explanation:
also im nice :) when people are not rude to me
The 2017 Annual Report of Tootsie Roll Industries contains the following information. (in millions) December 31, 2017 December 31, 2016 Total assets $930.9 $920.1 Total liabilities 197.1 208.6 Net sales 515.7 517.4 Net income 80.7 67.2 Compute the following ratios for Tootsie Roll for 2017. (a) Asset turnover (Round answer to 3 decimal places, e.g. 0.851 times.) enter the asset turnover rounded to 4 decimal places times (b) Return on assets (Round answer to 2 decimal places, e.g. 4.87%.) enter the return on assets in percentages rounded to 2 decimal places % (c) Profit margin on sales (Round answer to 2 decimal place
Answer:
a. 0.557 times
b. 8.72%
c. 0.16
Explanation:
a. Asset turnover = Net sales ÷ Average total assets
We will calculate the average total asset first
Average total asset = [Beginning total assets - ending total assets)] / 2
= [(930.9 + 920.1)] / 2
= 925.5
Asset turnover = 515.7/925.5
= 0.557 times
b. Return on assets = Net income/Average total assets
= 80.7/925.5
= 0.087196
= 0.087196 × 100
= 8.72%
c. Profit margin on sales = Net income/Net sales
= 80.7/515.7
= 0.16
Assume that MTA Sandwiches sells sandwiches for $7.20 each. The cost of each sandwich follows. Materials $ 2.70 Labor 0.90 Variable overhead 0.45 Fixed overhead ($10,800 per month, 6,000 units per month) 1.80 Total costs per sandwich $ 5.85 One of MTA’s regular customers asked the company to fill a special order of sandwiches at a selling price of $5.40 each for a fund-raising event sponsored by a social club at the local college. MTA has capacity to fill it without affecting total fixed costs for the month. MTA’s general manager was concerned about selling the sandwiches below the cost of $5.85 and has asked for your advice. Required: a. Prepare a schedule to show the impact on MTA’s profits of providing 400 sandwiches in addition to the regular production and sales of 6,000 sandwiches per month. b. Based solely on the data given, what is the lowest price per sandwich at which the special order can be filled without reducing MTA’s profits?
Answer:
MTA Sandwiches
a. A Schedule:
Special Order Regular Production Total
Total contribution $540 $18,900 $19,440
Fixed overhead 0 10,800 10,800
Profit $540 $8,100 $8,640
Profits increased by $540 with the special order.
b. The lowest price per sandwich at which this special order of 400 sandwiches can be filled without reducing MTA's profits is $4.05. This is equal to the unit variable cost. At this price, neither profit will be generated nor loss incurred from the special order.
Explanation:
a) Data and Calculations:
Cost of each sandwich:
Materials $ 2.70
Labor 0.90
Variable overhead 0.45
Fixed overhead
($10,800 per month,
6,000 units per month) 1.80
Total costs per sandwich $ 5.85
b) Computation of total profit for special order and regular production:
Special Order Regular Production Total
Selling price = $5.40 7.20
Variable (Relevant) cost:
Materials $ 2.70
Labor 0.90
Variable overhead 0.45 $4.05 $4.05
Contribution per unit $1.35 $3.15
Total contribution ($1.35*400) $540 $18,900 ($3.15*6,000) $19,440
Fixed overhead 10,800
Profit $8,640
The following information pertains to Bridgeport Co.:
Preferred stock, cumulative:
Par value per share $100
Dividend rate 6%
Shares outstanding 10,000
Dividends in arrears none
Common stock:
Par value per share $10
Shares issued 140,000
Dividends paid per share $1.80
Market price per share $52
Additional paid-in capital $500,000
Unappropriated retained
earnings (after closing) $280,000
Retained earnings
appropriated for
contingencies $300,000
Common treasury stock:
Number of shares 10,000
Total cost $250,000
Net income $580,000
Compute (assume no changes in balances during the past year):
A) Total amount of stockholders' equity in the balance sheet.
B) Earnings per share of common stock.
C) Book value per share of common stock.
D) Payout ratio of common stock.
E) Return on common stock equity per share per share.
Answer:
A. Total amount of stockholders' equity in the balance sheet.
= Preferred stock + Common Stock + Additional Paid-In Capital + Unappropriated retained earnings + Retained earnings appropriated for contingencies - Treasury stock
= (100 * 10,000) + (10 * 140,000) + 500,000 + 280,000 + 300,000 - 250,000
= $3,230,000
B. Earnings per share of common stock.
= (Net Income - Preferred Dividends ) / (Common stock - treasury stock)
= (580,000 - (10,000 * 6% * 100) ) / (140,000 - 10,000)
= $4
C. Book value per share of common stock.
= (Stockholder's equity - Preferred stock) / ( Common stock - Treasury)
= (3,230,000 - (100 * 10,000) ) / (140,000 - 10,000)
= $17.15
D. Payout ratio of common stock
= Dividend per share/ Earnings per share
= 1.8/4
= 45%
E. Return on common stock equity
= (Net Income - Preferred Dividends ) / (Stockholder's equity - Preferred stock)
= (580,000 - (10,000 * 6% * 100) / (3,230,000 - (100 * 10,000) )
= 0.233
= 23.3%
You receive a credit card application from Shady Banks Savings and Loan offering an introductory rate of .6 percent per year, compounded monthly for the first six months, increasing thereafter to 17.5 percent compounded monthly. Assume you transfer the $6,500 balance from your existing credit card and make no subsequent payments. How much interest will you owe at the end of the first year? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Answer:
Total interest paid = $606.63
Explanation:
First calculate the monthly payment for first six months
Monthly interest for first 6 months =.006/12=.0005
= 6500*(1.0005)^6
=6519.52
Interest rate for next six months
=17.37%/12=1.45%
(1.0145)^6=1.090054
=6519.52*(1+.0145)^6
=7106.63
Total interest paid = 7106.63-6500
Total interest paid = 606.63
A manufacturing company produces products 1, 2, and 3. The three products have the following resource requirements and produce the following profit:
Profit Labor (hr/unit) Material (lb/unit) Profit ($/unit)
1 5 4 $3
2 2 6 5
3 4 3 2
At present, the firm has a daily labor capacity of 240 available hours and a daily supply of 400 pounds of material. Management has developed the following set of goals, arranged in order of their importance to the firm:
1. Because of recent labor relations difficulties, management wants to avoid underutilization of normal production capacity.
2. Management has established a satisfactory profit level of exist500 per day.
3. Overtime is to be minimized as much as possible.
4. Management wants to minimize the purchase of additional materials to avoid handling and storage problems.
Required:
Formulate a goal programming model (multi-criteria model) to determine the number of each product to produce to best satisfy the goals.
di+, di- are the deviation variables for i-th objectives.
Product_1, product_2, product_3 are respectively the products 1,2 and 3 to be produced in a day. Those are the Standard variables
goal: (1/400)*d4+ (2/240)*d3+ (3/500)*d2-+ Min (4/240)*d1-
variables are equal or bigger than zero
400 = 5*product_1 + 6*product_2 + 3*product_3 - d4- + d4+
240 = 5*product_1 + 2*product_2 + 4*product_3 - d3- + d3+
240 = 5*product_1 + 2*product_2 + 4*product_3 + d1- - d1+
500 = 3*product_1 + 5*product_2 + 2*product_3 + d2- - d2+
You sell $4,000 per week in bags of dog food at 30% margin. You sell $3,000 per week in dog toys at 45% margin. Which generates more margin for you?
what do you think are the adverse effects when sustainable economic development practices in country are not implemented?
Answer:
Ignoring the issues of sustainable development has many possible consequences, such as rising sea levels, extreme droughts, erosion and loss of forests, increases in slum populations, species extinctions and collapsing fisheries.
The correct statement is that when the sustainable economic developments in the country are not met, a direct impact is seen in its growth and financial position of the country is weakened.
When there is no sustainable development the people of the country would ultimately suffer due to the bad policies being implemented regarding the allocation of funds.
A country should look after the developments of a country by allocation of required funds in the right fields and achieve such financial goals. Citizens must disclose their earnings and pay taxes on the true and fair amounts of such incomes. This will help in collection of taxes making the country less deficit in funds.A direct effect will be seen in country's GDP whenever there is no development. As a result of this there will be inflation in the country which will reduce the consumer's purchasing power.Hence, a country's GDP is affected when there is no proper sustainable economic development practice and also leads to inflation situations.
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Jim wants to start his own business and needs $10,000 for working capital. He applies for a business loan at FirstBank. The banker tells Jim that the Bank will make the loan if Jim's father will personally guarantee repayment of the loan. Jim assures the banker that his father will do this. The banker calls Jim's father to confirm that he will guarantee Jim's $10,000 loan. Jim's father says: "Sure thing, I'd do anything for that boy." The bank makes the loan to Jim. Jim's new business is not successful and Jim is unable to repay the loan. Jim has no money. Jim's father has buckets of money. The bank sues Jim's father to recover the unpaid amount of the loan plus interest plus attorneys' fees and costs of collecting the debt.
Which of the following is true?
A. Jim's father can make a strong argument that he is not liable to pay his son's debt because the Bank did not have him sign a written guaranty agreement.
B.The oral agreement to guaranty the loan is not enforceable because it is contrary to public policy.
C.Jim’s father is liable to pay his son’s debt because the Bank partially performed under the loan agreement.
D.If it can be proven in a court of law that Jim's father orally agreed to guarantee the loan, Jim's father will be held liable for the repayment of the loanbecause 'a deal is a deal'.
Answer:
D. If it can be proven in a court of law that Jim's father orally agreed to guarantee the loan, Jim's father will be held liable for the repayment of the loan because 'a deal is a deal'.
Explanation:
In this case, an offer was made by the bank to Jim with his father as a third party, of which his father agreed to the terms and conditions of the loan through an oral channel. An oral channel is an acceptable means of communication of agreement. It could be through a phone call or fax. So, a contract has been consented to by Jim's father.
Jim's father is thus liable for the repayment of the loan.
