Victor’s Repair Shop has a monthly target operating income of $20,000. Variable expenses are 60% of sales, and monthly fixed expenses are $12,000.

Requirements

1. Compute the monthly margin of safety in dollars if the shop achieves its income goal.

2. Express Victor’s margin of safety as a percentage of target sales.

3. What is Victor’s operating leverage factor at the target level of operating income?

4. Assume that the company reaches its target. By what percentage will the company’s operating income fall if sales volume declines by 12%?

Answer:

r or expected rate of return - market = 0.14 or 14%

r or expected rate of return - stock = 0.2120 or 21.20%

Explanation:

Using the CAPM, we can calculate the required/expected rate of return on a stock. This is the minimum return required by the investors to invest in a stock based on its systematic risk, the market's risk premium and the risk free rate.  

The formula for required rate of return under CAPM is,

r = rRF + Beta * rpM

Where,

Under CAPM, the assumption follows that the beta of the market is always equal to 1.

So, expected return on the stock market will be,

r or expected rate of return - market = 0.06 + 1 * 0.08

r or expected rate of return - market = 0.14 or 14%

The beta of the stock is given. We calculate the required rate of return on the stock to be,

r or expected rate of return - stock = 0.06 + 1.9 * 0.08

r or expected rate of return - stock = 0.2120 or 21.20%

Answer:

If a Dollar is worth $ 0.7809 Euros in New York, and $ 0.7793 Euros in Paris, the way in which foreign exchange traders could obtain an economic profit through this difference would be by buying Euros in Paris, and selling them again in New York. Thus, they would obtain $ 0.016 of profit for each Euro traded in the market, with which, for example, if $ 1,000,000 of Euros were traded, a total profit of $ 16,000 would be obtained. In turn, trading the same amount in both Paris and New York, traders would not make any profit, equating both exchange rates.

Answer:

elect not to write the recommendation.

Explanation:

A job recommendation is a way of vouching for a person's behaviour, honesty, and qualifications to perform a job.

On important step before giving recommendations is to think carefully if you know and trust the person sufficiently to vouch for him.

If a recommendation is written about person and he fails to perform well, the person that wrote the recommendation will lose credibility and his career may be adversely affected.

In this instance since there are serious concerns about the qualifications of a job candidate who has asked you for a written recommendation, elect not to write the recommendation

Answer:

0.5

Explanation:

marginal propensity to consume Can be regarded as the increase in pay that is been consumer experience on the purchasing of products which is just a part at aggregate. Instead of consumer to save

We are told that income rises from $46,000 to $48,000.

The difference= $48,000-$46,000= $2000

✓consumption spending rises from $38,00 to $39,500

The difference= $39,500-$38,00= $1000

Then the marginal propensity to consume can calculated as ratio of the difference in consumption spending to income rise

=1000/2000=0.5

Therefore, the MPC is 0.5

Answer: 22%

Explanation:

Compound interest at 20% per year for 2 years is;

= (1 + 20%)² - 1

= 1.44 - 1

= 44%

The simple interest in 2 years will also be 44% for it to be equivalent.

For the yearly simple interest rate simply divide by 2 because simple interest does not get compounded.

= 44%/2

= 22%

Answer and Explanation:

The computation of the amount that should be reported for the cost of goods sold and the gross profit is shown below;

But before that first determine the following amounts

Adjusted Purchases = Purchases  - Purchase Returns and Allowances  - Purchase Discounts  + Freight-in

= $374,100 - $12,700 - $6,000 + $16,600

= $372,000

Now the cost of goods sold is

= Beginning Inventory + Adjusted Purchases - ending Inventory

= $61,600 + $372,000 - $88,100

= $345,500

And,

Gross Profit = Net Sales - cost of goods sold

= $652,800 - $345,500

= $307,300

Answer:

Break-even point in units= 770

Explanation:

Giving the following information:

Selling price= $500

Unitary variable cost= $260

Fixed costs= $184,800

To calculate the break-even point in units using the mathematical equation, we need to use the following formula:

Net income= unit contribution margin*x - fixed costs

x= number of units

0= (500 - 260)*x - 184,800

184,800/240 = x

770=x

Now, under the unit contribution margin method:

Break-even point in units= fixed costs/ contribution margin per unit

Break-even point in units= 184,800/240

Break-even point in units= 770

Answer:

b. Critical steps

Explanation:

The use of the flow chart is to make identification of the critical points or steps in each and every point for accessing the potential hazards also it became useful for the important points that should be controlled in the process

Therefore in the given case, the option B is correct

And, the same is to be considered

Answer:

C. Demand

Explanation:

Have a nice day

The amount of goods and services that consumers want is called demand.

Demand is an economic concept that refers to a consumer's desire to buy goods and services as well as their willingness to pay a certain price for them. When the price of a good or service rises, the quantity demanded falls. Similarly, lowering the price of a good or service raises the quantity demanded.

Demand is a concept that both consumers and businesses are familiar with because it makes sense and occurs naturally throughout almost any day. For example, shoppers who have their eye on a product will buy more if the price is low. When prices rise, such as when the seasons change, shoppers buy fewer items, or none at all.

Therefore, demand is the amount of goods and services consumers want.

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Answer:

c. 5.91%

Explanation:

The Number of unemployed = Civilian Labor force - No of employed

The Number of unemployed = 364,000 - 338,500

The Number of unemployed = 25,500

Unemployment rate = (No of unemployed/Labor force)*100

Unemployment rate = (25500/364000)*100

Unemployment rate = 7.01%

The New number of unemployed after 4,000 of the people looking for work get discouraged and give up their job searches = 25,500 - 4,000 = 21,500

So, the new unemployment rate = (21500/364000)*100

= 5.91%

Answer:

Bond Price​= $536.38

Explanation:

Giving the following information:

Face value= $1,000

Number of periods= 20

Cupon rate= 0.07

YTM= 0.14

To calculate the price of the bond, we need to use the following formula:

Bond Price​= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]

Bond Price​= 70*{[1 - (1.14^-20)] / 0.14} + [1,000/1.14^20)

Bond Price​= 463.62 + 72.76

Bond Price​= $536.38

Answer: They would be treated equally

Explanation:

States of natures in decision making under ignorance would be treated equally, and as such they would be treated equally.

Answer:

b. coins, currency, checks, money orders, money on hand or on deposit in a bank or similar depository.

Explanation:

Cash consists of coins, currency, checks, money orders, money on hand or on deposit in a bank or similar depository. Cash is distinct from postage stamps, credit, money orders or checks that are not physically being held by the holder.

Cash can be defined as a legal tender such as money in its physical form which can typically be used to purchase goods and services, as well as pay debt.

Answer:

1.)A “digital presence” simply refers to how your business appears online; it's what people find when they search for your business or company on the internet. Digital presence includes content that you control, like your website and social media profiles, but also content that you don't control, such as online reviews.

2.)Job Security:This may seem like it should go without saying, but keeping a professional online presence is very important to keep your job! Your employers need to know that you are not going to hurt the brand and image of the company. ... Then keeping your online presence professional is key.

3.)The Importance of Having an Online Presence is Crucial Now More Than Ever. During this pandemic, it is critical businesses must be online. Having an online presence can help you build an audience, connect with your customers, and keep them updated on your day to day activities, as well as hours of operation.

Answer:

d. variant

Explanation:

A variant signifies a set of attributes that is specific to the firm or location in which the firm operates.

For example, a restaurant chain operating for years that decide to entertain its guest with a live band in its new has just added a new variant to its customer benefit package.

Answer:

Phone and utilities

Explanation:

Hope this helps

Answer: Phone and Utilities

Explanation: Have a good day :)

Answer:

A. not affect the total value of any of the equity accounts.

Explanation:

A balance sheet can be defined as a financial statement of an organization which is typically used to record financial informations liabilities, capital, shareholder's equity, assets, debts at a specific period of time.

In respect to a balance sheet, a stock split will not affect the total value of any of the equity accounts.

A stock split can be defined as a process in which a company divides its existing shares of the stock it owns into multiple new shares to its shareholders in proportion to the amount of their holdings. Thus, a stock split will not affect the total value of any of the equity accounts with respect to a balance sheet.

Answer:

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Answer:

$12,000

Explanation:

The formula for depreciation expense, using straight line method is;

= (Cost - Scrap value) / life time

Give that;

Cost = $70,000

Scrap value = $10,000

Life time = 5 years

= ($70,000 - $10,000) / 5

= $60,000 / 5

= $12,000.

Therefore, book value on December 31, 2011 would be;

= $70,000 - $12,000 × (4 + 10/12)

= $70,000 - $58,000

= $12,000

• Note that we arrived at the value of 10 because March to December is 10 months.

Answer:

800 Recliners

Explanation:

Calculation for the optimal number of recliners the company should make during each production run

Using this formula

Economic Order Quantity (EOQ) =√ [(2 D x S) / C]

Where,

Annual Demand (D) = 6,400 Recliners

Fixed Ordering Cost (S) = $400

Carrying cost per recliner (C) = $8

Let plug in the formula

Economic Order Quantity (EOQ)= √[(2 x 6,400 x $400) / $8]

Economic Order Quantity (EOQ)=√$5,120,000/$8

Economic Order Quantity (EOQ)=√$640,000

Economic Order Quantity (EOQ)= 800 Recliners

Therefore the optimal number of recliners the company should make during each production run will be 800 Recliners

Answer:

Prepare the journal entry to record the bond retirement on January 1, 2016.

total bond premium = $500,000 x 1.06 = $530,000

carrying bond value = $530,000 - $5,000 = $525,000

gain/loss = carrying value - cash paid = $525,000 - $515,000 = $10,000

Keep in mind the carrying value – cash paid to retire bonds = gain or loss on bond retirement

Dr Bonds payable 500,000

Dr Premium on bonds payable 25,000

    Cr Cash 515,000

    Cr Gain on retirement of bonds 10,000

Apr. 8: Issued a $5,000, 60-day, six percent note payable in payment of an account with Bennett Company.

Dr Accounts payable 5,000

    Cr Notes payable 5,000

May 15: Borrowed $40,000 from Lincoln Bank, signing a 60-day note at nine percent.

Dr Cash 40,000

    Cr Notes payable 40,000

Jun 7: Paid Bennett Company the principal and interest due on the April 8 note payable.

Dr Notes payable 5,000

Dr Interest expense 50

    Cr Cash 5,050

Jul. 6: Purchased $12,000 of merchandise from Bolton Company; signed a 90-day note with ten percent interest.

Dr Merchandise inventory 12,000

    Cr Notes payable 12,000

Jul. 14: Paid the May 15 note due Lincoln Bank.

Dr Notes payable 40,000

Dr Interest expense 600

    Cr Cash 40,600

Oct.2: Borrowed $30,000 from Lincoln Bank, signing a 120-day note at 12 percent.

Dr Cash 30,000

    Cr Notes payable 30,000

December 31, adjusting entry

Dr Interest expense 600

    Cr Interest payable 600

Oct. 4: Defaulted the note payable to Bolton Company.

No journal entry required

Answer:

If the price decreases then the supply in demand increases.

Explanation:

The reason behind this is to do with how the law of demand works.

Answer:

Advertising, promotion, pricing, sales and distribution.

Explanation:

Marketing mix refers to the choices about product attributes, distribution strategy, communication strategy, and pricing strategy that a firm offers its targeted markets.

Generally, a marketing mix is made up of the four (4) Ps;

1. Products: this is typically the goods and services that gives satisfaction to the customer's needs and wants. They are either tangible or intangible items.

2. Price: this represents the amount of money a customer buying goods and services are willing to pay for it.

3. Place: this represents the areas of distribution of these goods and services for easier access by the potential customers.

4. Promotions: for a good sales record or in order to increase the number of people buying a product and taking services, it is very important to have a good marketing communication such as advertising, sales promotion, direct marketing etc.

Hence, with an understanding of which consumers buy a firm's new products at each stage of the diffusion of innovation process, the firm can adjust its advertising, promotion, pricing, sales and distribution strategy accordingly.

Answer:

The Work in Process Inventory account.

Explanation:

Process costing can be defined as a cost accounting method used for assigning manufacturing or production costs to the units of goods produced by a business firm over a specific period of time. It is mostly used by firms that produce a large quantity of homogeneous or similar products on a continuous basis. Process costing typically uses more than one Work in Process Inventory account because costing at each stage of production or manufacturing process.

In a process costing system, when manufacturing overhead costs are applied to the cost of production, they are debited to the Work in Process Inventory account.

In the manufacturing process, partially or partly completed goods that are still in the process of being converted into a finish product are defined as work-in-process inventories.

Generally, the work-in-process inventories include the following raw materials cost, direct labor cost and factory overhead cost.

These category of products are only partially completed and as such are waiting for further processing, still undergoing fabrication or kept in a buffer storage.

In conclusion, Process costing typically uses a separate Work in Process Inventory account for each department while job order costing typically uses only one Work in Process Inventory account for each product.

Answer:

Total overhead= $41,500

Explanation:

Giving the following information:

Variable overhead first quarter= $14,500

Variable overhead increases= $3,600

Fixed overhead= $19,800

To calculate the total overhead for a specific quarter, we need to use the following formula:

Total overhead= fixed overhead + variable overhead + variable overhead increase*x

x= number of quarter

Now, for the second quarter:

Total overhead= 19,800 + 14,500 + 3,600*2

Total overhead= $41,500

Answer:

The entry to record this transaction will be,

Accumulated depreciation     16000

Cash                                          23000

Loss on disposal                      1000

    Machine                                      40000

Explanation:

The straight line method of depreciation charges a constant depreciation expense throughout the useful life of the asset. The formula to calculate depreciation expense per year under this method is,

Depreciation expense per year = (Cost - Residual value) / Estimated useful life of the asset

Depreciation expense per year = (40000 - 0) /  5  = $8000 per year

The net book value of the machine on 1 January 2016 = 40000 - (8000 * 2)

NBV =  $24000

As the machine was sold for $23000, the loss on disposal will be,

Loss on disposal = 23000 - 24000 = -1000 or $1000 loss

Answer:

For a given subgroup size, say n=2, notice that the value of d2 changes as the number of subgroups, k, increases. As an example, notice that d2=1.150 for n=2 and k=15. When k is infinite, the value of d2=1.128. Notice the difference in the value of d2 is small.

Explanation:

Answer:

false

Explanation:

Answer: 50400

Explanation:

- Straight-line rate= 100%/ 5 years= 20%

- Double declining Expense= 20% x 2= 40%

From Oct1 to Dec 31 is 9 months/ 12 months a year

- Depreciation Expense year 1= $120000x 0.4x 9/12= $36000

- Book value year 1= beginning year 2= $120000-$36000= $84000

- Book value year 2= $84000- ($84000x0.4)= $50400

The asset is valued at $60,000 at the end of year 2 December by using the asset depreciated on the double-declining-balance method.

Depreciation is allocated to charge a reasonable percentage of the depreciable value throughout each accounting period for the asset's anticipated useful life.

Given,

Purchase Value = $120,000 ( On October 1)

Expected Life = 5 Years

Salvage Value = $15,500

Required to calculate asset value at the End of Year 2  =?

Depreciation Rate = Book Value x 2 divided by Life of Asset

                               = $120,000 x 2/5 = $48,000

Depreciation Rate  = 48,000 x 100/ 120,000 = 40%

Book Value of Year 1 = 120,000 - 120,000 x 40% x 3/12 = $108,000

Book Value for end Year 2 = $108,000 - 120,000 x 40% =  $60,000.

Thus, the Book value of the asset at end of year 2 is $60,000.

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