Answer:
The correct answer is letter "A": The demand for her haircuts is elastic.
Explanation:
Elasticity is a feature of certain goods and services that affect their quantity demanded after a change in prices. The price elasticity of demand is calculated by dividing the percentage of change in quantity demanded by the percentage of change in price. Results equal to or greater than one (1) imply the demand for that product is elastic while results lower than 1 means the demand is inelastic.
Thus, if a salon owner realizes her revenue increased after decreasing the haircut prices, it implies the demand for haircuts is elastic.
Vivi Corporation had net income of $401,000 in 2015. The company's Common Stock account balance all year long was $267,000 ($10 par stock). The company does not hold any Treasury Stock. The market price per share as of December 31, 2015, was $33.50. Calculate the price-earnings ratio for 2015.
Answer:
2.23 is the price earnings ratio.
Explanation:
Firstly we must find the Earnings per share for this problem as it is needed to calculate the price earnings ratio so earnings per share = (Net income)/(Number of shares outstanding).
we are given net income of $401000 then to obtain number of shares outstanding for 2015 are $267000/$10 as we saw the company's common stock account balance all year long was that value of which each share has a par value of $10, then we get outstanding shares which are 26700 now we calculate the earnings per share (EPS) by using the above formula with substituting the above mentioned values :
Earnings Per Share= $401000/26700
= $15.01872659
now we will use the Price Earnings Ratio formula which is
Price Earnings Ratio = (current share price)/(earnings per share )
we have been given a current share price of $33.50 now we will use the earnings per share which was calculated above.
Price Earnings Ratio = $33.50/$15.01872659
= 2.230548628 then we round off the answer to two decimal places
Price Earnings Ratio = 2.23
Business writers who use words such as interrogate, remuneration, and terminate are using language many readers would consider a. slang.b. conversational.c. jargon.d. unfamiliar.
Answer:
D. Unfamiliar
Explanation:
Business writers use many different words while writing journal articles or doing accounting or finance-related topics. For a non-business individual, it is challenging to perceive those words such as interrogation, termination, and remuneration. It is because of unfamiliarity with the terms. Those are not slanged words or jargon.
Hence, option D is the answer.
Flipco signed a 15-year note payable on January 1, 2018, of $900,000. The note requires annual principal payments each December 31 of 60,000 plus interest at 10%. The entry to record the annual payment on December 31, 2022, includesA. a debit to Interest Expense for $ 36, 000.
B. a debit to Interest Expense for $ 40, 000.
C. a credit to Notes Payable for $ 80, 000.
D. a credit to Cash of $ 120, 000.
Answer:A debit to interest expense for $36,000
Explanation:
interest expense= 800,000-80,000 = 720,000 5% 12/12
Southwest Airlines uses its assets very productively. Its turnaround time, or the time that its airplanes sit on the ground while they are being loaded and unloaded, is the lowest in the airline industry. In terms of the primary financial objectives of a firm, this attribute is a measure of Southwest's ________.
Answer: Efficiency
Explanation:
Efficiency shows the highest performance level that utilizes the smallest amount of inputs to attain the biggest amount of output. Efficiency is the act of reducing unnecessary resources used in the production of a given output.
Efficiency reduces the waste of resources like energy, physical materials, and time albeit achieving the desired output. It is the aim of every organization to get the best results using the least cost. Southwest Airlines is efficient in its production since it uses its assets and time well.
Southwest Airlines' low turnaround time exemplifies its operational efficiency, directly aligning with financial objectives like maximizing shareholder value and improving profitability through enhanced asset utilization and better financial performance.
Explanation:Southwest Airlines' ability to keep its airplanes' turnaround time to a minimum is a measure of the company's strong operational efficiency. This efficiency translates into better utilization of assets, thus directly contributing to the primary financial objectives of a firm: maximizing shareholder value and increasing profitability. Lower turnaround times mean more flights can be operated with the same number of aircraft, leading to higher revenue generation and reduced costs per flight. This approach not only offers competitive pricing but also ensures better customer satisfaction by minimizing delays. Therefore, Southwest's strategy perfectly aligns with enhancing asset utilization and improving financial performance.
Southwest Airlines uses its assets very productively by having the lowest turnaround time in the industry, which is the time its airplanes sit on the ground being loaded and unloaded. This attribute is a measure of Southwest's operational efficiency and how effectively it utilizes its resources to achieve its financial objectives.
Armour, Inc., an advertising agency, applies overhead to jobs on the basis of direct professional labor hours. Overhead was estimated to be $216,000, direct professional labor hours were estimated to be 18,000, and direct professional labor cost was projected to be $270,000. During the year, Armour incurred actual overhead costs of $212,000, actual direct professional labor hours of 17,500, and actual direct labor cost of $317,000. By year-end, the firm's overhead was:
a. $2,000 underapplied.
b. $6,000 underapplied.
c. $4,000 underapplied
d. $2,000 overapplied
e. $4,000 overapplied.
Answer:
a. $2,000 underapplied.
Explanation:
Estimated Overhead = $216,000
Estimated Professional hours = 18,000
Predetermined overhead rate = $216,000 / 18,000 = $12 per hour
Actual Professional hours = 17,500
Overhead applied = $12 x 17,500 hours = $210,000
Actual overhead = $212,000
Under applied overhead = Applied overhead - Actual overhead
Under applied overhead = $210,000 - $212,000
Under applied overhead = $2,000
Macarty Company's Prepaid Insurance account had a balance of $2,700. It was determined that $1,500 of the Prepaid Insurance had expired. The adjusting entry for Insurance Expense for the year would be__________.
Complete question:
At December 31, 2013, before any year-end adjustments, Macarty Company's Prepaid Insurance account had a balance of $2,700. It was determined that $1,500 of the Prepaid Insurance had expired. The adjusted balance for Insurance Expense for the year would be
A.$1,500. B.$1,200. C.$2,700. D.$1,900
Answer:
The adjusted balance for Insurance Expense for the year would be $1,500
Explanation:
The investment of premium costs ends each year with a null investment and rises as the account is debited over the year. The balance in the accrued asset plan will continue by the close of the financial year before the next financial year.
When you purchase an premium, debit an rise in the benefit in your accrued expense account. And the Bank statement is listed to indicate financial deficit. Change the accounts every month to the sum of the scheme.
The adjusting entry would recognise insurance expense of $1,500
Thom owes $7,400 on his credit card. The credit card carries an APR of 18.5 percent compounded monthly. If Thom makes monthly payments of $230 per month, how long will it take for him to pay off the credit card assuming that he makes no additional charges
To determine the duration Thom will need to pay off his credit card debt, we must perform calculations involving the debt's APR and monthly payment amount, considering compound interest over time. An exact answer requires using financial formulas or a payment calculator.
Explanation:The student is asking how long it will take Thom to pay off his credit card debt of $7,400 with an APR of 18.5% compounded monthly, given that he makes monthly payments of $230 and assuming no additional charges are made. To answer this, we can either set up an amortization schedule to determine the amount of time necessary to pay off the debt or use a financial calculator or online payment calculator that applies the compound interest formula. Calculating the exact time to pay off the debt involves understanding the amortization of the loan, which accounts for both principal and interest over time.
However, since solving this requires more complex financial formulas, we can't provide an exact number of months without performing the appropriate calculations. Generally, paying off debt with this APR and monthly payments requires analyzing how much of the payments go towards interest and how much reduces the principal balance.
Gary and Lakesha were married on December 31 last year. They are now preparing their taxes for the April 15 deadline and are unsure of their filing status. a. What filing status options do Gary and Lakesha have for last year?
Answer:Thier status should be either Married filing jointly or Married filing separately.
Explanation:
For Filing status purposes, taxpayers must be married at the end of the year and filing status depend on whether you're considered married or single by the end of that year. One is considered for tax purposes if legally married on the last day of the year and living with his or her spouse.
Gary and Lakesha were married on the last day of the year, 31st December and so for filing purposes, are considered married for the entire year . Gary and Lakesha can either file as married filing jointly, or they may choose to file as married filing separately. Though it is necessary for them to choose the one that allows them to pay the least amount of tax.
Gary and Lakesha can choose to file their taxes as 'Married Filing Jointly' or 'Married Filing Separately' since they were married on December 31. They must consider the marriage bonus and penalty, which depend on their individual incomes and deductions, to decide the best filing status.
Gary and Lakesha, who were married on December 31 last year, are now preparing their taxes and are unsure of their filing status. Since they were married on the last day of the tax year, for tax purposes, they are considered to have been married for the full year. This gives them a few filing status options for last year:
Married Filing Jointly: This option allows them to combine their incomes and deductions into one tax return, which can be beneficial if one spouse has a significantly higher or lower income than the other.Married Filing Separately: This option allows them to file separate tax returns, which may be advantageous in certain situations, such as when one spouse has significant medical expenses or other individual deductions, or when they want to keep their finances separate.It's worth noting that there's a concept known as the "marriage bonus" or the "marriage penalty", which refers to the way that taxes can be affected by marriage. Some couples may pay less tax when filing jointly compared to what they would pay as two single individuals (marriage bonus), while others, especially those with similar incomes, might end up paying more (marriage penalty).
Therefore, Gary and Lakesha should consider their individual incomes, potential deductions and credits, and other tax-related factors when deciding on the best filing status. They must file their Income Tax Return by the April 15 deadline, and it should include both of their last names as they are preparing a joint document.
An important application of regression analysis in accounting is in the estimation of cost. By collecting data on volume and cost and using the least squares method to develop an estimated regression equation relating volume and cost, an accountant can estimate the cost associated with a particular manufacturing volume. Consider the following sample of production volumes and total cost data for a manufacturing operation.Production Volume Total Cost(Units) ($)400 4,000450 5,000550 5,400600 5,900700 6,400750 7,000Use the data to develop an estimated regression equation that could be used to predict the total cost for a given production volume.what is the variable cost per unit produced?
Answer:
a. y = 1246.667 + 7.6x
b $7.6 per unit
Explanation:
a..
Given
n = 6.
Solving the regression equation using
y = a + bx
See attachment for solution
a = 1246.667
b = 7.3
So, y = 1246.667 + 7.3x
b.
The Variable cost per unit is given by the slope of the regression equation i.e. the coefficient of x
Which is 7.6
TyroneCo, an S corporation, reports gross receipts for the year totaling $400,000 (of which $200,000 is passive investment income). Expenditures directly connected to the production of the passive investment income total of $80,000.
Tyrone’s passive investment income tax is ______.
TyroneCo, an S corporation, has a net passive investment income of $120,000 ($200,000 gross passive income minus $80,000 related expenditure). The passive investment income tax, charged at a rate of 35%, is $42,000.
Explanation:The question involves calculating passive investment income tax for an S corporation like TyroneCo. To calculate the tax, we need to figure out the net passive investment income first. In this case, the passive investment income is $200,000 and the expenditure directly associated with generating this income is $80,000. So:
Net Passive Investment Income = Gross Passive Income - Related Expenditure
Net Passive Investment Income = $200,000 - $80,000 = $120,000.
he tax rate for excessive net passive income for S corporations is 35%. Therefore, Tyrone’s passive investment income tax would be 35% of $120,000, which equals $42,000.
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Estimates based on the assumption that historical data can be used as a frame of reference for current estimates are: Ballpark estimates. Feasibility estimates. Comparative estimates. Definitive estimates.
Answer:
The correct answer is letter "C": Comparative estimates.
Explanation:
In project management, comparative estimates are forecasts carried out comparing previous project's information. The purpose of conducting such an analysis is to have an idea of what is the amount of money necessary to conduct a new project. The estimation is what its name describes, just an estimate but help managers to allocate the resources they have and request those who may be necessary for the operations of the new plan.
Lasseter Corporation has provided its contribution format income statement for August. The company produces and sells a single product.
Sales (3,800 units) $ 95,000
Variable expenses 38,000
Contribution margin 57,000
Fixed expenses 43,600
Net operating income $ 13,400
If the company sells 3,900 units, its total contribution margin should be closest to:
a. $13,753
b. $57,000
c. $58,500
d. $59,500
Answer:
The correct answer is C.
Explanation:
Giving the following information:
Sales (3,800 units) $ 95,000
Variable expenses 38,000
First, we need to calculate the unitary selling price and unitary variable cost.
Selling price= 95,000/3,800= $25
Unitary variable cost= 38,000/3,800= $10
Now, we can calculate the total contribution margin for 3,900 units:
Sales= 25*3,900= 97,500
Variable cost= 10*3,900= (39,000)
Contribution margin= 58,500
The Big Buy Supermarket stocks Munchies Cereal. Demand for Munchies is 4,000 boxes per year (365 days). It costs the store $60 per order of Munchies, and it costs $0.80 per box per year to keep the cereal in stock. Once an order for Munchies is placed, it takes 4 days to receive the order from a food distributor. Determine the following:
a. The optimal order size
b. The minimum total annual inventory cost
c. The reorder point
Answer:
a. 775 units
b. $670
c. 44 units
Explanation:
a. The computation of the economic order quantity is shown below:
= [tex]\sqrt{\frac{2\times \text{Annual demand}\times \text{Ordering cost}}{\text{Carrying cost}}}[/tex]
= [tex]\sqrt{\frac{2\times \text{4,000}\times \text{\$60}}{\text{\$0.80}}}[/tex]
= 775 units
b. The minimum total annual inventory cost is
= Ordering cost + carrying cost
where,
Ordering cost =
The number of orders would be equal to
= Annual demand ÷ economic order quantity
= 4,000 ÷ 775 units
= 5.61 orders
Ordering cost = Number of orders × ordering cost per order
= 6 orders × $60
= $360
The carrying cost is
The average inventory would equal to
= Economic order quantity ÷ 2
= 775 units ÷ 2
= 387.5 units
The total cost of ordering cost and carrying cost equals to
Carrying cost = average inventory × carrying cost per unit
= 387.5 units × $0.80
= $310
So, the minimum total annual inventory cost is
= $360 + $310
= $670
The computation of the reorder point is shown below:
= Demand × lead time + safety stock
where, Demand equal to
= Expected demand ÷ total number of days in a year
= 4,000 ÷ 365 days
= 10.95890
So, the reorder point would be
= 10.95890 × 4 + $0
= 44 units
To address the supermarket's inventory management, we apply the Economic Order Quantity (EOQ) model which takes into account demand, order cost and holding cost. The optimal order size is 387 boxes, the minimum total annual inventory cost is $620.36, and the reorder point, when the supermarket should place another order, is approximately 44 boxes.
Explanation:To solve this problem, we can use the formula of the Economic Order Quantity (EOQ) model which is: EOQ = sqrt[(2DS)/H], where D is the annual demand, S is the order cost, and H is the holding cost.
a. The optimal order size
By substituting D = 4000 boxes, S = $60, and H = $0.80 into the EOQ formula, we get: EOQ = sqrt[(2 * 4000 * 60) / 0.80] = 387 boxes. Therefore, the optimal order size is 387 boxes
b. The minimum total annual inventory cost
The total inventory cost is the sum of the order cost and the holding cost, which equals to D/Q * S + Q/2 * H. Substituting the computed EOQ and other given values, we get: Total Cost = (4000 / 387 * 60) + (387 / 2 * 0.80) = $620.36. Therefore, the minimum total annual inventory cost is $620.36.
c. The reorder point
The reorder point is when the inventory level drops to the lead time demand, which is D/L where L is the lead time. With a demand of 4000 boxes and a lead time of 4 days (i.e. 4/365 of a year), the Reorder Point = 4000 * (4 / 365) = 43.84 boxes. Therefore, the reorder point is approximately 44 boxes.
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Antiques R Us is a mature manufacturing firm. The company just paid a dividend of $10.90, but management expects to reduce the payout by 5 percent per year indefinitely. If you require a return of 10 percent on this stock, what will you pay for a share today?
Answer:
$69.033
Explanation:
As per dividend growth model, the current market price of a stock is given by the following equation:
[tex]P_{0} = \frac{D_{0}(1\ +\ g) }{R\ -\ g}[/tex]
wherein, [tex]P_{0}[/tex] = current market price of a stock
R = Required rate of return
g = Annual growth rate in dividends
[tex]D_{0}[/tex] = Dividend just paid
Hence, in the given case, since the dividend is reducing by 5% every year, we have,
[tex]P_{0} =[/tex] [tex]\frac{10.9(1\ -\ .05)}{.10\ -\ (-5)}[/tex]
[tex]P_{0} =[/tex] [tex]\frac{10.355}{.15}[/tex] = $69.033
The given case corresponded to negative growth model wherein dividend paid is consistently falling till perpetuity. Hence, in the formula, g is deducted in the numerator and added in the denominator owing to negative sign.
Exercise 12-04 a-b (Video) McGill and Smyth have capital balances on January 1 of $54,000 and $48,000, respectively. The partnership income-sharing agreement provides for (1) annual salaries of $19,000 for McGill and $14,000 for Smyth, (2) interest at 10% on beginning capital balances, and (3) remaining income or loss to be shared 70% by McGill and 30% by Smyth.
Question Continuation
Complete the schedule showing the distribution of net income, assuming net income is $54,000
Answer:
McGill takes $31,540
Smyth takes $22,460
Total: $54,000
Explanation:
Salary Allowance
McGill: $19,000
Smyth: $14,000
Total Salary Allowance = $33,000
Interest Allowance
McGill: $54,000 x 10% = $5,400
Smyth: $48,000 x 10% = $4,800
Total Interest Allowance = $5400 + $4,800 = $10,200
Total salaries and interest
McGill =$24,400 ($19,000 + $5,400)
Smyth: $18,800 ($14,000 + $4,800)
Sum = $43,200
Remaining income
McGill = $10,200 x 70% = $7,140
Smyth: $10,200 x 30% = $3,060
Total division between McGill and Smyth
McGill takes $31,540
Smyth takes $22,460
Total: $54,000
Accounts receivable at the beginning of the year are $270. The company has a 45-day collection period. Calculate cash collections in each of the four quarters by completing the following: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. A negative answer should be indicated by a minus sign.)
Complete Question
The Litzenberger Company has projected the following quarterly sales amounts for the coming year: Sales
Q1 $800
Q2 $830
Q3 $910
Q4 $990
Accounts receivable at the beginning of the year are $270. The company has a 45-day collection period. Calculate cash collections in each of the four quarters by completing the following: (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16. A negative answer should be indicated by a minus sign.)
Beginning receivables (a)
Sales (b) $800.00 $830.00 $910.00 $990.00
Cash collections (c )
Ending receivables
Answer:
The account receivable at the beginning of the year are $270 ------ Given
We'll use the sales row to calculate the account receivable at the beginning of other quarters.
Q1 = $270
Q2 = $800/2 = $400
Q3 = $830/2 = $415
Q4 = $910/2 = $455
Calculating the cash collections...
This is calculated by -1(Beginning Receivable + ½(Sales))
Q1 = -(270 + ½ * 800) = $670
Q2 = -(400 + ½ * 830) = -$815
Q3 = -(415 + ½ * 910) = -$870
Q4 = -(455 + ½990) = -$950
The 45 days collection period means that all receivable outstanding would be collected in current month plus ½ of sales of current month
The complete table is
Beginning receivables (a) $270 ---- $400 --- $415 --- $455
Sales (b) $800.00 ---- $830.00 --- $910.00 --- $990.00
Cash collections (c ) -$670 --- -$815 --- -$870 --- -$950
Ending receivables (a+b-c) $430.00 $415.00 $455.00 $495.00
Explanation:
Last month when Holiday Creations, Inc., sold 37,000 units, total sales were $283,000, total variable expenses were $215,080, and fixed expenses were $39,600. Required: 1. What is the company’s contribution margin (CM) ratio? 2. What is the estimated change in the company’s net operating income if it can increase total sales by $2,500? (Do not round intermediate calculations.)
Answer:
a. 24%
b. $600
Explanation:
The computation is shown below:
a. The contribution margin ratio is
= (Sales - variable cost) ÷ (Contribution margin) × 100
= ($283,000 - $215,080) ÷ (283,000) × 100
= ($67,920) ÷ (283,000) × 100
= 24%
b. Now the estimate change in the net operating income is
= Increase in total sales × contribution margin ratio
= $2,500 × 24%
= $600
The fixed cost remain unchanged
What is the present value of the following series of payments:
$300 made at the end of every year starting in year 1 and ending in year 30 EXCEPT there will be no payment of any kind at the end of year 15?
Interest is 8% annual rate compounded annually.
Answer:
he made about 300
Explanation:
Lowe Co. manufactures products A and B from a joint process. Sales value at split-off was $700,000 for 10,000 units of A and $300,000 for 15,000 units of B. Using the sales value at split-off approach, joint costs properly allocated to A were $140,000. Total joint costs were
Answer:
$200,000
Explanation:
Using the sales value at split-off approach, the allocated costs are proportional to the percentage of total sales that each product is responsible for generating. The percentage of sales that derive from product A are:
[tex]A = \frac{700,000}{700,000+300,000}= 70\%[/tex]
Therefore, the total joint costs were:
[tex]C = \frac{C_A}{A}\\ C=\frac{140,000}{0.7}\\ C=\$200,000[/tex]
Total joint costs were $200,000.
Blanchard, Inc., is considering introducing a new product and wants to earn a 15% return on sales. If the market price is estimated to be $200, the most the company can spend and still achieve the goal (the target cost) is
Answer:
$170
Explanation:
If the goal is to achieve a 15% return on sales, Blanchard Inc., can afford to spend at most 85% of the estimated price ($200) on the production of the new product. Therefore, the target cost is:
[tex]C = 0.85*\$200\\C=\$170[/tex]
The target cost is $170.
Dessa Cabinetry, Inc., manufactures standard sized modular cabinet units for kitchens and other applications within the home. Its costing system utilizes two cost categories, direct materials and conversion costs. Each product must pass through the rough cut department and the finish department. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production.Data for Finishing Department for March 2017 are:
Work in process, beginning inventory, 20% converted 1,000 units
Units started during February 1,800 units
Work in process, ending inventory 500 units
Costs for Finishing department for March 2017 are:
Work in process, beginning inventory:
Direct materials $200,000
Conversion costs $204,000
Direct materials costs added during February $428,000
Conversion costs added during February $141,000
How many units were completed and transferred out of the Finishing department during March?
Answer:
Units were completed and transferred out of the Finishing department during March were 2,300 units
Explanation:
With Process Costing the Physical units introduced should equal Physical Units of Output in that Process
Units IN:
Opening Work In Progress 1,000
Units Started 1,800
Physical units introduced 2,800
Units OUT:
Closing Work In Progress 500
Units Completed and Transferred (Balancing Figure) 2,800-500 2,300
Physical Units of Output 2,800
Identify whether each of the examples represent a "House of Brands" or a "Branded House" for of brand architecture. Procter & Gamble Toothpaste & Mouthwash Brands Crest, Colgate, Scope, Oral - B Answer 1 Coca Cola Soft Drink Brands Coca Cola Zero, Coca Cola, Coca Cola Life Answer 2 Virgin Brands
Answer: Procter &Gamble: House of Brands
Coca Cola Soft Drink Brands: Branded House
Virgin Brands: Branded House
Explanation:
House of Brands and Branded House are two forms of marketing architecture.
A house of Brands: is an umbrella brand for different products each with its own unique appeal, target audience and marketing designed to appeal to its audience. Procter & Gamble is such an example with products such as Crest, Colgate, Scope, Oral - B. Each of these brands is given a strong brand presence without necessarily drawing on the strength of the Procter & Gamble brand.
A branded house has a single brand presence and its marketing leverages on the brand strength, even when it is geared towards different audiences for different products. Coca Cola and Virgin Brands are examples. Despite having widely varying products, the Virgin brand is used as an overall marketing brand.
Final answer:
Procter & Gamble operates as a House of Brands with independent brands like Crest and Οral-B, whereas Cοca Cοla and Vîrgin Brands function as Branded Houses with sub-brands sharing the master brand's identity.
Explanation:
The concept of brand architecture refers to the structure of brands within an organizational entity. Identifying whether a company operates as a House of Brands or a Branded House is key to understanding their marketing and branding strategy. Procter & Gamble represents a House of Brands because it owns a portfolio of distinct brands such as Crest, Cοlgate, Scοpe, and Oral-B, each with its own identity and marketing strategy. On the other hand, Cοca Cοla operates primarily as a Branded House, with sub-brands like Cοca Cοla Zero and Cοca Cοla Life, all sharing the Cοca Cοla master brand. Lastly, Vîrgin Brands is also a Branded House, leveraging the Vîrgin master brand across diverse industries from entertainment to air travel.
The contract size for platinum futures is 50 troy ounces. Suppose you need 500 troy ounces of platinum and the current futures price is $1,265 per ounce. How many contracts do you need to purchase? How much will you pay for your platinum? What is your dollar profit if platinum sells for $1,290 a troy ounce when the futures contract expires? What if the price is $1,210 at expiration?a. Contracts to purchase b. Purchase price c. Dollar profit at $1,290 d. Dollar profit at $1,210
Answer:
Explanation:
a) Contract to purchase = 500 troy ounces / 50 = 10 contracts
b) Purchase price = 500 ounces × $ 1265 = $ 632500
c) Dollar profit at $ 1290 = 500 ( $ 1290 - $ 1265) = $ 12500
d) Dollar profit at $ 1290 = 500 ( $1210 - $1265) = $- 27500
The given statement is "The contract size for platinum futures is 50 troy ounces. Suppose you need 500 troy ounces of platinum and the current futures price is $1,265 per ounce. How many contracts do you need to purchase? How much will you pay for your platinum? What is your dollar profit if platinum sells for $1,290 a troy ounce when the futures contract expires? What if the price is $1,210 at expiration?" a. Contracts to purchase: 10 contracts b. Purchase price: $12,650 c. Dollar profit at $1,290: $12,500 d. Dollar profit at $1,210: -$27,500
Let's break down the questions one by one:
a. Contracts to purchase:
To purchase 500 troy ounces of platinum using platinum futures with a contract size of 50 troy ounces each, you would need:
Contracts = Total Ounces Needed / Ounces per Contract
Contracts = 500 ounces / 50 ounces per contract
Contracts = 10 contracts
So, you would need 10 platinum futures contracts to purchase 500 troy ounces of platinum.
b. Purchase price:
To calculate the purchase price, you would multiply the number of contracts by the current futures price:
Purchase Price = Contracts x Current Futures Price
Purchase Price = 10 contracts x $1,265 per ounce
Purchase Price = $12,650
You would pay $12,650 for your 500 troy ounces of platinum.
c. Dollar profit at $1,290:
If the platinum price is $1,290 per troy ounce at contract expiration, you can calculate your profit as follows:
Profit = (Selling Price - Purchase Price) x Total Ounces
Profit = ($1,290 - $1,265) x 500 ounces
Profit = $25 x 500 ounces
Profit = $12,500
Your dollar profit would be $12,500 if platinum sells for $1,290 a troy ounce when the futures contract expires.
d. Dollar profit at $1,210:
If the platinum price is $1,210 per troy ounce at contract expiration, your profit would be:
Profit = (Selling Price - Purchase Price) x Total Ounces
Profit = ($1,210 - $1,265) x 500 ounces
Profit = (-$55) x 500 ounces
Profit = -$27,500
Your dollar profit would be -$27,500 (a loss) if platinum sells for $1,210 a troy ounce when the futures contract expires.
Please note that futures trading involves significant risk, and this calculation assumes a simple scenario without considering trading costs, margin requirements, and other factors.
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On May 7, Keenan Company purchased on account 620 units of raw materials at $21 per unit. During May, raw materials were requisitioned for production as follows: 211 units for Job 200 at $19 per unit and 273 units for Job 305 at $21 per unit.
Required:
Journalize the entry on May 7 to record the purchase and on May 31 to record the requisition from the materials storeroom.
Answer:
Dr Material Inventory $13,020
Cr Trade Payables $13,020
Dr Work In Progress $9,742
Cr Material Inventory $9,742
Explanation:
On 7th May the double entry would be to record the inventory purchases on credit which would increase the inventory by $13,020 (620*21) as under:
Dr Material Inventory $13,020
Cr Trade Payables $13,020
The material sent to production or manufacturing team would be recorded as increase in the work in progress by the value of the material issued which is $9,742 (211*$19 + 273*$21).
Dr Work In Progress $9,742
Cr Material Inventory $9,742
On June 1 of the current tax year Elisha and Ezra (who are equal partners) contribute property to form the Double E Partnership. Elisha contributes cash of $456,480. Ezra contributes a building and land with an adjusted basis and fair market value of $760,800, subject to a liability of $304,320. The partnership borrows $47,550 to finance construction of a parking lot in front of the building. At the end of the first year (December 31), the accrual basis partnership owes $19,020 in trade accounts payable to various creditors. The partnership reported net income of $71,325 for the year, which they share equally. Assume that Elisha and Ezra share equally in partnership liabilities. How much is Elisha's basis in the partnership interest on December 31? Ezra's? Round interim and final answers to whole dollars.
Elisha's basis: $ 677588
Ezra's basis: $ 677588
Answer:
Elisha Basis in Partnership is $ 677,588.
Ezra Basis in Partnership is $ 677,588.
Explanation:
Partnership is kind of business where two or more person contributes capital according to agreed ratio and share profit and losses according to agreement of partnership called partnership deed.
Partnership basis can be calculated as follows:
Elisha Basis in Partnership
Description Amount
Contribution in Cash 456,480
+ Contributed Land liability share 152,160 ---- (304320/2)
+ Construction debt share 23,775 ----- (47550/2)
+ Account Payable Share 9,510 ----- (19020/2)
+ Net Income Share 35,663 --- (71325/2)
Elisha basis in Partnership $ 677588
Ezra Basis in Partnership
Description Amount
Building & Land 760,800
- Debt of partnership (304320)
+ Contributed Land liability share 152,160 ---- (304320/2)
+ Construction debt share 23,775 ----- (47550/2)
+ Account Payable Share 9,510 ----- (19020/2)
+ Net Income Share 35,663 --- (71325/2)
Ezra basis in Partnership $ 677588
Flex Co. just paid total dividends of $1,075,000 and reported additions to retained earnings of $3,225,000. The company has 715,000 shares of stock outstanding and a benchmark PE of 17.3 times. What stock price would you consider appropriate?a. $52.80
b. $17.60
c. $70.40
d. $63.36
e. $66.88
Given:
Total dividends = $1,075,000
Retained earnings = $3,225,000
Stock outstanding = 715,000 stocks
Benchmark PE = 17.3 times
To find:
Stock price
Solution:
To calculate the stock price, initially we have to calculate the earnings per share,
[tex]\text{Earnings per share} = \frac{\text{(Dividend + addition to retained earnings)}}{\text{Total number of shares}}[/tex]
[tex]\Rightarrow\frac{(600000 + 1800000)}{525000}=4.571428571[/tex]
Now, to calculate the PE ratio,
[tex]\text{PE ratio} = \frac{\text{Stock price}}{\text{EPS}}\Rightarrow\text{Stock price} = \text{PE ratio}\times\text{EPS}[/tex]
[tex]\text{Stock price}=4.571428571\times15.4=\$70.4[/tex]
Therefore, the the stock price would be $70.40 that is, option c.
Final answer:
The appropriate stock price can be calculated based on the P/E ratio, company's earnings, and dividends.
Explanation:
The appropriate stock price can be calculated using the P/E ratio and the company's earnings and dividends. Given that Flex Co. paid total dividends of $1,075,000, and reported additions to retained earnings of $3,225,000, with 715,000 shares outstanding, we can calculate the stock price as $63.36 (option d).
In 2015, the world’s total output (real GDP) wIn 1960, America’s GDP per capita was approximately $17,000 (measured in today’s dollars). How much higher in percentage terms was America’s GDP per capita in 2015
Answer: GDP per capita Percentage increase = 232.02%
Explanation:
1960 GDP per capita measured in today's dollars (US) ≈ $17000
2015 GDP per capita (US) = $56443.82
Percentage increase = (56443.82 - 17000)/17000 = 2.320224706 =
GDP per capita Percentage increase = 232.02%
Answer:
232.02
Explanation:
Practitioners agree that the purpose of ______ is to "help an organization understand its behavior and its present situation—what’s going on, how it’s going on—so that something can be done about it.
Answer:
The options for answering this question are:
to. feedback
b. data gathering
c. interviews
d. diagnosis
The correct answer is: d. diagnosis
Explanation:
The Business Diagnosis is a simple and very useful tool for the purpose of knowing the current situation of an organization and the problems that prevent its growth, survival or development. It is a process of several studies carried out in the production, services and production companies. Commerce. It allows us to identify and know a series of problems to propose an action plan that guides the future of the organization.
The main objective of the business diagnosis is the location and analysis of existing failures at different levels in the company, and to be able to come up with a range of solution alternatives based on an action plan that is consistent with the comprehensive analysis of the organization.
The diagnosis should be in the shortest possible time and the plan that you prepare for this purpose should show how to obtain good results, preferably in the short term.
What is the empirical relationship between urbanization in 1500 and GDP per capita? How has this relationship changed over time? 1.) Using the line drawing tool, illustrate the relationship between urbanization in 1500 and GDP per capita in 1500. Label your line 'GDP per capita in 1500.' 2.) Using the line drawing tool, show the relationship between urbanization in 1500 and GDP per capita in 2010. Label your line 'GDP per capita in 2010.' Carefully follow the instructions above and only draw the required objects.
The relationship between urbanization and GDP per capita has shifted significantly from 1500 to 2010, with urbanization rates increasing at different levels of income per capita.
The empirical relationship between urbanization in 1500 and GDP per capita has changed over time. In 1500, the relationship between urbanization and GDP per capita was different from that in 2010. The minimum level of urbanization appears to have risen from zero in 1500 to 20% in 2010.
The relationship has evolved, and urbanization rates are 25-30 percentage points higher in 2010 than in 1500 at any given level of income per capita. This indicates that there has been urbanization without growth at every level of development from 1500 to 2010.
The changing relationship between urbanization and GDP per capita over time is evident in the data, with urbanization rates rising across the entire spectrum of development.
Therefore, the relationship between urbanization and GDP per capita has shifted significantly from 1500 to 2010, with urbanization rates increasing at different levels of income per capita.
The ________ proposed that all impediments to the formation of a single market be eliminated by December 31, 1992, resulting in the Single European Act.
Answer:
Explanation:
The Delors Commission proposed that all impediments to the formation of a single market be eliminated by December 31, 1992, resulting in the Single European Act. The result was the Single European Act, which was independently ratified by the parliaments of each member country and became EC law in 1987.