Answer:
= $120,500.00
Explanation:
Flexible budget is that which is that which recognizes the cost behavior and is used for control purpose. It is prepared based on the actual level of activity achieved.
Kindly note that the $59,000 depreciation is a fixed cost which do not vary with the hours of production.
The flexible budget for the department will be
Direct Labour budget = ( 51000/3400) × 4,100
= $61,500.00
Equipment depreciation= $59,000
Total flexible budget = $61,500.00 + $59,000
= $120,500.00
The Silver Center (TSC) produces cups and platters. TSC purchases silver and other metals that are processed into silver alloy that is used to make platters and cups. TSC incurred $40,000 of materials cost and $44,000 of labor cost to produce the silver alloy. Platters are made first and the residual alloy is remixed into a lower grade silver plated material that is used to make the cups. Remixing cost amount to $2,000. The recent batch contained 4,000 platters and 1,000 cups. TSC sold the platters for $100,000 and the cups for $12,000. If number of units is used to allocate the joint cost, what is the income earned for platters?
a. $67,200.
b. $32,800.
c. $12,000.
d $(4,800).
Answer:
Income Earned for platters=$32,800
Option B is Correct ($32,800)
Explanation:
First we will calculate the cost Allocated to both cups and platter:
Allocation rate= [tex]\frac{Total\ Cost\ incurred }{Total\ Units}[/tex]
Allocation rate=[tex]\frac{\$40,000+\$44,000}{4000+1000} \\[/tex]
Allocation rate=$16.8
Amount Allocated for Platters= Units of platter* Allocation rate
Amount Allocated for Platters= 4000*$16.8
Amount Allocated for Platters= $67,200.
Calculating Income for platters:
Sales of platters=$100,000
Remixing Cost for platters= $0
Income Earned for platters=Sales of platters-Amount Allocated for Platters-Remixing Cost for platters
Income Earned for platters=$100,000-$67,200-$0
Income Earned for platters=$32,800
Option B is Correct ($32,800)
Final answer:
After allocating the joint costs based on the number of units produced, we find that the income earned for platters is $31,200. This is not an exact match to the provided options, suggesting a possible typo in the question, but $32,800 is the closest among the given choices.
Explanation:
The student has presented a cost allocation problem involving the production of platters and cups with silver alloy. To calculate the income earned for platters, we must allocate the joint costs on the basis of the number of units produced.
Total joint costs (materials + labor + remixing): $40,000 + $44,000 + $2,000 = $86,000.Total units produced (platters + cups): 4,000 + 1,000 = 5,000 units.Joint cost allocation per unit: $86,000 / 5,000 units = $17.20/unit.Joint cost allocated to platters: $17.20/unit imes 4,000 units = $68,800.Revenue from platters: $100,000.Income for platters: Revenue from platters - Joint cost allocated to platters = $100,000 - $68,800 = $31,200.The correct answer is $31,200, which is not one of the options provided, indicating there may be a typo in the options. However, the closest answer from the given options is b. $32,800.
Production used 2.5 labor hours per finished unit, and the company actually paid $21 per hour, totaling $52.50 per unit of finished product. What amount is the company’s direct labor rate variance for March?
Answer:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual hours
Explanation:
Giving the following information:
The production used 2.5 labor hours per finished unit, and the company paid $21 per hour, totaling $52.50 per unit of finished product.
We weren't provided with enough information to solve the problem. We need estimated production hours and rates. But, I can leave the formula to solve it.
To calculate direct labor rate variance, we need to use the following formula:
Direct labor rate variance= (Standard Rate - Actual Rate)*Actual Hours
You just ended a meeting with Ming (one of your six employees), who gave you some disturbing information. She feels she is being bullied by one of her coworkers and is seeking your advice on how to handle it. Ming said that Mindy has been saying "good morning" to everyone as she walks by their office but doesn’t say it to Ming. Ming also said that Mindy organized a farewell lunch for one of your departing employees last week and didn’t invite Ming. She also told you of nasty things that Mindy tells other colleagues about her. For example, last month when Ming ran into Mindy at the grocery store, Mindy told everyone the next day the medications that Ming had in her cart, which included medication for irritable bowel syndrome. Ming also showed you an e-mail that Mindy had sent blaming Ming for the loss of one of Mindy’s clients. Mindy had copied the entire department on the e-mail. Ming thinks that other employees have been reluctant to involve her in projects as a result of this e-mail. Ming left your office quite upset, and you think you may need to take some action. In your blog, discuss the following:
Do you think Ming is correct in saying Mindy is bullying her?
What are the indications of bullying?
What advice would you give to Ming?
How would you handle this situation with Mindy, without embarrassing Ming?
Answer:Do you think Ming is correct in saying Mindy is bullying her?
Yes , she is right, Mindy is definitely bullying her.
What are the indications of bullying?
Bullying doesn't only occur physically but also psychologically and and emotionally,especially in a place of work it can de identified by mistreatment of the other person,verbal abuse , threatening and humiliating the other person.
The bullied person is outcastes , alienated , excluded and ignored like what Mindy is doing, ignoring Ming while he greet everyone else , excluding her by not inviting her in a farewell lunch , eventhough all other colleagues are invited by Mindy.
Spreading false rumours is also part of bullying .
He also critized her publicly by publicly sharing an email about a loss of a client caused by Ming .
These are all signs of abuse.
What advice would you give to Ming?
She will need to keep record or document everything so that when she decides to take the matter further , she may be able to submit proof of what has been happening to her,this will give evidence.
How would you handle this situation with Mindy, without embarrassing Ming?
I think talking to Mindy in an objective way without including Ming's name will be helpful since Mindy has publicly shared his bullying activities. I can actual point out things that are not allowed at work and how certain things can be harmful and degrading to other employees. Make him see how certain behavior affects other employees and how this can be a serious issue that can affect the company and affects even Mindy himself .
Ming is accurate in her assessment of Mindy's bullying.
Demotivating the victim, generating false expectations with no plans to realize it, purposefully neglecting the victim are all signs of bullying. Removing someone from a community or making him feel emotionally or economically isolated is a form of intentional exclusion.
Making the victim believe that they are the source of the problem, Critiquing someone's work or conduct on a regular basis, frequently for unjustified reasons Withholding knowledge from someone or providing them incorrect information, for example.
Ming has experienced some with the above indications of workplace bullying. And it is well within her rights to advise her supervisor of this.
First and foremost, I would assure Ming that she will not have any such problems in the future, and that I will personally address this matter.
I'll speak with Mindy and try to grasp her perspective on such behavior. And I'll make her informed of the regulations that apply in our office, such as the fact that bullying is not tolerated in the workplace. And it will provide her with an opportunity to modify her conduct.
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Great Cruiseline offers nightly dinner cruises off the coast of Miami, San Francisco, and Seattle. Dinner cruise tickets sell for $ 80 per passenger. Excel Cruiseline's variable cost of providing the dinner is $ 40 per passenger, and the fixed cost of operating the vessels (depreciation, salaries, docking fees, and other expenses) is $ 240, 000 per month. The company's relevant range extends to 18,000 monthly passengers. The breakeven sales are 9000 tickets sold. Use this information to compute the following:
a. Compute the operating leverage factor when Great Cruiseline sells 12000 dinner cruises.
b. If volume increases by 8%, by what percentage will operating income increase?
c. If volume decreases by 5%, by what percentage will operating income decrease?
Answer:see attached file
Explanation:
Red Sun Rising Corp. has just signed a lease for its new manufacturing facility. The lease agreement calls for annual payments of $1,100,000 for 20 years with the first payment due today. If the interest rate is 3.25 percent, what is the value of this liability today?
Answer:
The value of Liability is $15,993,281
Explanation:
Red Sun Rising Corp. is making annuity Payment of $1,100,000 for a period of 20 years. The value of this liability can be calculated by taking net present value of all future cashflows.
Present value of Annuity = P [ 1 - ( ( 1 + r )^-n ) / r ]
Present value of Annuity = $1,100,000 [ 1 - ( ( 1 + 3.25% )^-20 ) / 3.25% ]
Present value of Annuity = $1,100,000 [ 1 - ( ( 1 + 0.0325 )^-20 ) / 0.0325 ]
Present value of Annuity = $1,100,000 [ 1 - ( ( 1.0325 )^-20 ) / 0.0325 ]
Present value of Annuity = $15,993,280.76
The value of the liability today for Red Sun Rising Corp.'s lease is $17,181,350.71.
Explanation:To determine the value of the liability, we need to calculate the present value of the lease payments. The present value of an annuity formula can be used for this calculation. The formula is:
PV = PMT x (1 - (1 + r)^-n) / r
Where PV is the present value, PMT is the annual payment, r is the interest rate, and n is the number of periods.
Substituting the values into the formula, we get:
PV = $1,100,000 x (1 - (1 + 0.0325)^-20) / 0.0325
Calculating this gives us the value of the liability today as $17,181,350.71.
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Using the following information, complete the incomestatement, statement of retained earnings, and balance sheet for
LUV Painting for the month of March 2018. The business began operations on March 1,2018.
Accounts Receivable $1,800
Salaries Expense $1,300
Accounts Payable 1,400
Service Revenue 10,500
Cash 23,500
Office Supplies 1,900
Stock issued during March 40,000
Truck 18,680
Dividends paid during March 4,500
Utilities Expense 220
Answer:
Gross profit = $8980
Retained earning (end) = $4480
Explanation:
LUV
Income Statement
For the m/o march 1,2018
$
Service revenue = 10500
less: Operating expense
Salaries expense 1300
Utilities expense 220
= (1520)
Gross profit 8980
LUV
Balance sheet
as on march 1,2018
ASSETS: $
Current Asset:
Cash = 23500
Account receivable = 1800
Office supplies = 1900
27200(a)
Fixed Asset:
Truck = 18680(b)
Total Assets (a+b) = 45880
LIABILITIES:
Account payable = 1400 (c)
STOCKHOLDERS EQUITY:
Issued stocks = 40000
Add: income = 8980
less: Paid dividend = (4500)
44480(d)
Total Stock holders asset and liabilities (c+d) = 45880.
LUV
Statement of retained Earning
as on march 1,2018
$
Retained earning (open) = 0
Add: Net income = 8980
less: Dividend = (4500)
Retained earning (end) 4480
How would a decrease in the price of the feed grains used to feed cattle affect the market for beef? a. The demand for beef would decrease, decreasing beef prices. b. The supply of beef would decrease, increasing beef prices. c. The demand for beef would increase, increasing beef prices. d. The supply of beef would increase, decreasing beef prices.
Answer: The supply of beef would increase, decreasing beef prices.
Explanation: if there is a decrease in the price of the feed grains used to feed cattle, it would leads to an increase in the supply of beef in the market and consequently decrease the price of beef in the market. It would result to an increase in the supply of beef because the cattle rearers would have enough feeds for the cattle which will make them grow faster.
A decrease in the cost of feed grains would likely increase the supply of beef, which could lead to a decrease in the price of beef. This is because lower production costs would allow farmers to raise more cattle for beef, thus increasing supply.
Explanation:If the price of feed grains that are used to feed cattle falls, it reduces the cost of producing beef. Consequently, this may lead to an increase in the supply of beef as cattle farmers may find it more profitable to raise more cattle for beef production. This, in turn, could potentially lead to a decrease in beef prices because when supply increases relative to demand, prices typically fall. Therefore, the correct option is d. The supply of beef would increase, decreasing beef prices.
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Office Depot has instituted the Office Depot Advantage, a program in which a customer who spends a minimum of $200 up to $299 in a three-month period can receive a $20 reward good for the purchase of additional Office Depot merchandise. Customers who spend between $300 and $499 receive a $30 reward and those who spend more than $500 quarterly receive a $50 reward. The goal of this _____ program is to encourage customers to consolidate their office product purchases at Office Depot.
a. relationship management
b. profit maximization
c. product satisfaction
d. customer maximization
e. a developing strategic alliance
The Office Depot Advantage program is a relationship management program aimed at encouraging customers to consolidate their office product purchases at Office Depot.
Explanation:Subject: BusinessThe subject of this question is Business.
This question is appropriate for High School level students.
The subject of this question is Business.
This program, called Office Depot Advantage, is an example of a relationship management program. It aims to encourage customers to consolidate their office product purchases at Office Depot by offering rewards based on their spending levels. This program helps Office Depot build and maintain strong relationships with their customers.
The program is designed to incentivize customers to spend more at Office Depot in order to receive greater rewards. This aligns with the goal of profit maximization, as the more customers spend, the more revenue Office Depot generates. Additionally, by consolidating their purchases, customers are likely to experience higher product satisfaction and convenience by having all their office product needs met in one place.
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UIC estimates that the in-state student demand for undergraduate education is Q subscript i n minus s t a t e end subscript equals 10 comma 000 space minus space 2 P , and out-of-state student demand is Q subscript o u t minus o f minus s t a t e end subscript equals 30 comma 000 space minus space P . The total market demand facing UIC will be a:
A. Straight line with a slope of -1.5
B. Straight line with a slope of -1.0
C. Kinked line with the kink at Q=5,000
D. Kinked line with the kink at P=5,000
Answer:
C. Kinked line with the kink at Q=5,000
Explanation:
After plotting graph between P and Q there is kink at Q=5000 and P=25,000
The profit and loss statement of Kitsch Ltd., an S corporation, shows $100,000 book income. Kitsch is owned equally by four shareholders. From supplemental data, you obtain the following information about items that are included in book income.
Selling expenses ($21,200)
Tax-exempt interest income 3,000
Dividends received 9,000
§1231 gain 7,000
Depreciation recapture income 11,000
Net income from passive real estate rentals 5,000
Long-term capital loss (6,000)
Salary paid to owners (each) (12,000)
Cost of goods sold (91,000)
a. The entity's nonseparately stated income is $82,000.
b. The portion of nonseparately stated income or loss for James Billings, one of the Kitsch shareholders, is $20,500.
c. What is James Billings’ share of tax-exempt interest income, if any?
$
Is the income taxable to him this year?
not taxable
Answer:
$82000$20500$750Not taxableExplanation:
with the information provided
A) how the entity's non separately stated income is $82000
to calculate the non separately stated income
(Total long term stated income) - (total short term stated income)
long term stated income
book value = $100000
long term capital loss/gain = $6000
book value + long term capital loss = $106000 ( total long term stated income )
short term stated income
tax exempt = $3000
dividends = $9000
1231 gain = $7000
net passive income = $5000
total short term stated income = 3000 + 9000 + 7000 + 5000 = $24000
hence non separately stated income = $106000 - $24000 = $82000
B) To show how one of he kitsch shareholder is bearing $205000 income or loss
Number of shareholder = 4
non separately stated income = $82000
non separately stated income / number of shareholder = 82000 / 4 =$20500
C)
Tax exempt income = $3000
number of share holders = 4
hence Billings' share of tax exempt interest income = tax exempt income / number of share holders
= $3000 / 4 = $750
Billings income is not taxable this year because his taxable income this year is $20500
Answer
82000
$20500
$750
Not taxable
Cruises, Inc., operates two divisions: (1) a management division that owns and manages cruise ships in the Florida Keys and (2) a repair division that operates a dry dock in Marble Sand Florida. The repair division works on company ships, as well as other large-hull ships.The repair division has an estimated variable cost of $28.50 per labor-hour. The repair division has a backlog of work for outside ships. They charge $48.00 per hour for labor, which is standard for this type of work. The management division complained that it could hire its own repair workers for $30.00 per hour, including leasing an adequate work area.
Required:
If the repair division had idle capacity, what is the minimum transfer price that the repair division should obtain?
Answer:
The minimum transfer price shoud be $28.50.
Explanation:
The transfer price is determined by two factors:
(1) The idle capacity of the business;
(2) The price in the market.
In this case, the repair division has idle capacity. This means that the transfer price could be equal to, but not lower than, the variable cost of production.
The estimated variable cost is $28.50 per labor-hour. However, this cost must be compared with the market price first, which is $30 per labor-hour. Hence, hiring labor from outside at $30 per labor-hour shall be relatively expensive and not a good option to exercise.
Since, the variable cost is lower, Cruises, Inc. should provide labor at $28.50 per labor-hour. Because there is idle capacity, this is also the minimum transfer price that should be charged.
Since the Repair Division of Cruise, Inc. has idle capacity, the minimum transfer price that it should obtain is $28.50 per labor-hour.
Without the idle capacity, the minimum charge should be $30 per labor-hour.
The minimum transfer price is the variable cost that the Repair Division incurs for both direct labor, direct material, and direct overhead costs. However, the question did not indiate if direct materials and overhead costs are involved. For simplicity, we assume that they are not required in the Repairs Division.
Thus, the minimum charge that the Repair Division should obtain is $28.50.
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Which of the following is an example of the free-rider problem? a. Both Zoe and Zach receive low-cost dental care at the local dental school, so neither of them pays the full cost of the care. b. Alfred receives a free lunch from the local "Meals on Wheels" program because of his low monthly income. Yet his next door neighbor, Alice, is not eligible for the free lunch. c. Bruce owns Buster, a large dog who barks whenever anyone walks near his house. Betty lives next to Bruce, and Buster's barking can be heard whenever anyone walks near her house, too. Thus, Betty receives free protection from burglars because of Buster's barking. d. Sam purchases a burger at a fast food restaurant and gets a second burger free because the restaurant is having a buy one, get one free sale.
Answer:
c. Bruce owns Buster, a large dog who barks whenever anyone walks near his house. Betty lives next to Bruce, and Buster's barking can be heard whenever anyone walks near her house, too. Thus, Betty receives free protection from burglars because of Buster's barking
Explanation:
Free rider is a form of market inefficiency that occurs when people benefit from a good or service but do not pay or underpay for the product.
Betty is receiving free protection from Bruce's dog.
I hope my answer helps you
Answer:
Which of the following is an example of the free-rider problem? Option C is the most suitable answer - Bruce owns Buster, a large dog who barks whenever anyone walks near his house. Betty lives next to Bruce, and Buster's barking can be heard whenever anyone walks near her house, too. Thus, Betty receives free protection from burglars because of Buster's barking.
Explanation:
In a situation whereby one party benefits without having to pay for the transaction themselves, and rather the other party pays for it, there would be an occurrence of the free-riding problem.
In the scenario described in the question, the neighbor is receiving benefits from burglars without having to pay for the security or dog.
Therefore, option C is the most suitable answer.
A local finance company quotes an interest rate of 18.1 percent on one-year loans. So, if you borrow $39,000, the interest for the year will be $7,059. Because you must repay a total of $46,059 in one year, the finance company requires you to pay $46,059/12, or $3,838.25 per month over the next 12 months.
a.What rate would legally have to be quoted? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
APR________ %
b.What is the effective annual rate? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
EAR______%
Final answer:
To determine the APR and EAR for the finance company's loan, specific financial formulas must be utilized that incorporate the effects of compounding, which are not provided by the simple interest quote.
Explanation:
The local finance company quoting an interest rate of 18.1% on a $39,000 loan results in an annual interest amount of $7,059. Given that the total repayment amount is $46,059 to be paid over 12 months, the monthly payment would be $3,838.25. However, the Annual Percentage Rate (APR) and Effective Annual Rate (EAR) are not immediately evident from these numbers, as they would incorporate the effect of compounding on the interest rate.
To find the APR, which is the nominal interest rate without compounding, we can use the formula provided by financial regulations, which typically involves dividing the total amount of interest paid by the loan amount and then multiplying by 100 to get a percentage. It is important to note that while the APR provides a way to compare different loans, it does not account for the effects of compounding.
To calculate the EAR, which includes the effects of compounding, we use a different formula that takes into account the frequency of compounding within the year. In cases where monthly payments are involved, this would be compounded monthly. The EAR formula reflects the actual yearly rate that borrowers would pay if they account for compounding within the year.
The legally quoted APR for the loan is 18.12%,
and the effective annual rate (EAR) is 19.76%. These rates account for the monthly interest and compounding effects over the year.
Calculating the Required Interest Rates
To determine the legally required quoted interest rate (APR) and the effective annual rate (EAR) for a loan, you can follow these steps:
a. Annual Percentage Rate (APR):
The APR is the nominal interest rate considering the costs associated with the loan. Here, we calculate the monthly interest rate first:
The total interest [tex]APR = 0.09843 * 12 * 100 = 118.12%.[/tex]the year is $7,059.
The principal is $39,000.
The monthly payment is $3,838.25.
The monthly interest rate can be calculated using the formula: R = (payment/principal) - 1.
So, R = $3,838.25 / ($39,000 / 12) - 1 = 0.09843.
Convert the monthly rate to an annual rate: APR = 0.09843 * 12 * 100 = 118.12%.
APR = 18.12%
b. Effective Annual Rate (EAR):
The effective annual rate considers the compounding effect:
The EAR is calculated using the formula:[tex](1 + monthly interest rate)^12 - 1.[/tex]
With the monthly rate R = 0.09843, we get:
[tex](1 + 0.09843)^12 - 1 = 0.19759.[/tex]
EAR = 19.76%
Therefore, the legally quoted APR is 18.12%, and the effective annual rate (EAR) is 19.76%.
The Marigold Inc., a manufacturer of low-sugar, low-sodium, low-cholesterol TV dinners, would like to increase its market share in the Sunbelt. In order to do so, Marigold has decided to locate a new factory in the Panama City area. Marigold will either buy or lease a site depending upon which is more advantageous. The site location committee has narrowed down the available sites to the following three very similar buildings that will meet their needs.
Building A: Purchase for a cash price of $600,000, useful life 25 years.
Building B: Lease for 25 years with annual lease payments of $69,000 being made at the beginning of the year.
Building C: Purchase for $650,000 cash. This building is larger than needed; however, the excess space can be sublet for 25 years at a net annual rental of $7,000. Rental payments will be received at the end of each year.
The Black Knights Inc. has no aversion to being a landlord Instructions In which building would you recommend that The Black Knights Inc. locate, assuming a 12% cost of funds?
Answer:
The solution the given problem is done below.
Explanation:
Building A: Purchase for a cash price of $600,000, useful life 25 years.
—PV = $600,000.
Building B: Lease for 25 years with annual lease payments of $69,000 being made at the beginning of the year.
Rent X (PV of annuity due of 25 periods at 12%)
PV =$69,000 X 8.78432
PV=$606,118.08
Building C: Purchase for $650,000 cash. This building is larger than needed; however, the excess space can be sublet for 25 years at a net annual rental of $7,000. Rental payments will be received at the end of each year.
PV of Building C—
Rent X (PV of ordinary annuity of 25 periods at 12%)
=$7,000 X 7.84314
PV=$54,901.98
Cashpurchasepriceof…………….$650,000.00
PV of rental income,……………..(54,901.98)
Net present value…………………..$595,098.02
In which building would you recommend that The Black Knights Inc. locate, assuming a 12% cost of funds?
Lease Building C since the present value of its net cost is the smallest.
Under what conditions is it ethically defensible to outsource production to the developing world where labor costs are lower when such actions also involve laying off long-term employees in the firm's home country?
Answer and explanation:
Outsourcing refers to the practice by which companies take their operations to a different country in an attempt to reduce costs or surpass stiff governmental regulations. Among the different costs firms reduce by outsourcing, labor hand is one of the most important. For this approach to be ethical, the countries where the company will start operations should be characterized by a high unemployment rate. Any form of investment to increase job positions will be healthy for such an economy.
On the other side, outsourcing will take away job positions in the country where the firm has its headquarters. In the case of long-term employees, it would be ethical to take their opportunities away only if they are approaching retirement age. It would be suitable to provide a job position to a head of a family in a different country paying that person less or at least the necessary to cover his or her basket of goods than paying high salaries to elder people with no children to support and who are about to retire.
Outsourcing production to developing nations where labor costs are lower may be ethically defensible if workers are treated well, paid a fair wage (considering local economic conditions), and if employment opportunities are created for them. However, businesses also need to consider the ethical implications of laying off employees in their home country and navigate the potential pitfalls of exploiting weak labor laws in developing nations.
Explanation:It can be ethically defensible to outsource production to the developing world under certain conditions. The key factor lies in the treatment and compensation of the workers in those countries. If the workers are paid a wage that, while low by Western standards, significantly improves their financial status and provides them with viable employment opportunities, then such outsourcing can be justified. Additionally, if the outsourcing firm adheres to stringent ethical and safety standards, treating their overseas workers with dignity and respect, outsourcing can be seen in a more ethical light.
However, the ethical debate does not end there. The issues of laying off long-term employees in the firm's home country and potentially exploiting developing nations' labor laws or lack thereof add complexity to the situation. It's essential for businesses to find a balance between leveraging global economic opportunities and maintaining ethical labor practices. At the core, the decision comes down to more than just financial considerations; it should also involve an honest evaluation of the societal and human impacts.
High-profile cases such as the Rana Plaza disaster and the controversy over sweatshops linked to major multinational corporations (MNCs) like Nike and Gap underline the importance of adopting ethical labor practices, no matter where operations are located. Restrictions on imports from countries with poor labor conditions and criticisms against companies using sweatshop labor are significant factors that businesses must consider while deciding on outsourcing.
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In the current year, Tanager Corporation (a calendar year C corporation) had operating income of $480,000 and operating expenses of $390,000. In addition, Tanager had a long-term capital gain of $55,000 and a short-term capital loss of $40,000.
(a) Compute Tanager’s taxable income and tax for the year.
(b) Assume the same facts except that Tanager's long-term capital gain was
$15,000. Compute Tanager’s taxable income and tax for the year.
Final answer:
Tanager Corporation's taxable income in scenario (a) is $105,000 with a tax of $22,050. In scenario (b) with a lower long-term capital gain, the taxable income is $90,000 and the tax is $18,900 assuming a corporate tax rate of 21%.
Explanation:
To compute Tanager Corporation’s taxable income for the year, we first determine their net operating income by subtracting operating expenses ($390,000) from operating income ($480,000), which gives us $90,000. Next, we consider the capital gains and losses. Since capital gains and losses are treated differently, we need to net the long-term gains against the short-term losses. For part (a), the long-term capital gain is $55,000 and the short-term capital loss is $40,000, so the corporation has a net long-term capital gain of $15,000 ($55,000 - $40,000). This brings the corporation's taxable income to $105,000 ($90,000 operating income + $15,000 net capital gain).
Assuming a corporate tax rate of 21% (the current U.S. corporate tax rate as of the knowledge cutoff), the tax would be $22,050 (21% of $105,000). For part (b), with a long-term capital gain of $15,000 and the same short-term capital loss of $40,000, the corporation cannot deduct the excess $25,000 loss against its operating income as there are limitations on capital loss deductions. Thus, for part (b), the taxable income is $90,000 (operating income only), and the tax would be $18,900 (21% of $90,000).
Zero-base budgeting: a. means the Congress has ""sunseted"" an agency. b. means that an agency does not automatically receive its previous year’s base budget. c. is unconstitutional. d. none of the above
Answer: b. means that an agency does not automatically receive its previous year’s base budget.
Explanation: By definition, zero-based budgeting (ZBB) implies commencing a budget from a zero base and justifying each segment of the budget rather than merely adding to historical budgets or actual.
Conventionally, budgets are queried when they show variations from previous years but in ZBB, there is a positive attempt to eliminate inefficiencies and slack from current expenditures.
The concept of ZBB was developed by Peter Pyhor in 1969 and identified the following structured systematic approach to budgeting:
* organisations are divided into sections known as decision unit or expense control units
* decision units are clearly defined
* for each unit, a decision package is defined for the minimum level of spending and this sets the tone for the cost, purpose, and performance measurement and consequences
* similar decision package is defined for incremental allocations to activities
* decision package is specified for alternative methods of performing those activities
* decision packages are ranked
Example of ZBB is: if an organization notices a percentage increase on an expenditure line, the organization can compare all available and suitable alternatives before taking that increase as bona fide, the organization can also consider using its outsourced or internal employees to achieve same purpose. Proper scrutiny is required in ZBB unlike the traditional budgeting process.
There are other types of budgets like rolling and flexible budgeting.
The Tangier Company is considering eliminating the following product line: Product AXP Sales $ 44,000 Less variable costs: Raw materials 27,000 Direct labor 6,600 Contribution margin $ 10,400 Less fixed costs: Production costs allocated to products 15,800 Profit (Loss) $ (5,400 ) What amount of cost is avoidable if Tangier outsources production of this product
Answer:
= $33,600.
Explanation:
Avoidable costs are example of relevant costs. These are costs that are incurred as a direct consequence of taking a decision. All direct costs associated with a decision to produce are avoidable costs, which means such costs will not be incurred should Tangire Company decides not to produce.
Kindly note that items of general fixed costs which are usually allocated are not avoidable. Simply because they would be incurred either way whether or not production takes place.
The avoidable cost of Tangier sums:
Raw material cost + Direct labor cost
= 27,000 + 6,600
= $33,600.
Sean works for Cash'n'Carry, a payday loan company. He has been asked to develop an ethical mission statement to reassure customer concerns regarding predatory lending practices. a. Nonterritorial offices b. Flattened management hierarchies c. Emphasis on ethics
Answer:
c. Emphasis on ethics
Explanation:
Sean has been tasked with developing a ethical mission statement with a view of reassuring customers on predatory lending practices.
This is a renewed emphasis on the ethics of the company and by so doing it will reassure the company is aware of the ethical practice in this regard and that they are pledging to act ethically.
Ethics is defined as the process of systemising and recommending concepts of right and wrong. It is also called moral philosophy.
below is the equity section of the balance sheet of bottle inc. as of december 31, 2014: common stock, $12 par value $2,280,000 paid-in capital in excess of par 1,330,000 the company only has one class of common stock and no preferred stock. what was the price of the common stock when it was first issued?
Answer:
The price of the common stock when it was first issued was $19 per share
Explanation:
Price at which the stock is issued is consists of Par value and add-in-capital in excess value. It is recorded in different accounts and reported as separately on the balance sheet.
Common Stock at par value of $12 = $2,280,000
Number of outstanding shares = 2,280,000 / 12 = 190,000 shares
Paid-in-Capital in Excess = $1,330,000 / 190,000 = $7 per share
As we know
Price of share = Par value + Paid in capital in excess
Price of share = $12 + $7 = $19 per share
Benson Company manufactures special metallic materials for luxury homes that require highly skilled labor. Benson uses standard costs to prepare its flexible budget. For the first quarter of the year, direct materials and direct labor standards for one of their popular products were as follows: Direct materials: 2 pounds per unit; $ 4 per pound Direct labor: 4 hours per unit; $ 14 per hour Benson produced 5 comma 000 units during the quarter. At the end of the quarter, an examination of the labor costs records showed that the company used 30 comma 000 direct labor hours and actual total direct labor costs were $ 240 comma 000. What is the direct labor efficiency variance?
Answer:
Direct labor efficiency variance= $140,000 unfavorable
Explanation:
Giving the following information:
Standard requirements:
Direct labor:
4 hours per unit
$ 14 per hour
Benson produced 5,000 units during the quarter.
Actual cost:
Actual direct labor hours= 30,000
direct labor costs= $240,000
First, we need to calculate the standard total direct labor hours required to produce 5,000 units.
Total direct labor hours= 5,000*4= 20,000 hours
Now, we can calculate the direct labor efficiency variance:
Direct labor efficiency variance= (Standard Quantity - Actual Quantity)*standard rate
Direct labor efficiency variance= (20,000 - 30,000)*14= $140,000 unfavorable
It is unfavorable because the company used more direct labor hours than estimated.
The Palmer Acres Inn is trying to determine its break-even point during its off-peak season. The inn has 50 rooms that it rents at exist75 a night. Operating costs are as follows: Salaries exist5, 400 per month Utilities exist1, 100 per month Depreciation exist1, 100 per month Maintenance exist5, 150 per month Maid service exist15 per room Other costs exist30 per room Determine the inn's break-even point in number of rented rooms per month. Break-even point _________ rooms Determine the inn's break-even point in dollars. Break-even point exist __________
Answer:
425 rooms
$31,875
Explanation:
In this question, we are asked to calculate the the break even point per room and the break even point in dollars.
We use a mathematical approach to solve this question.
Firstly, we calculate the total fixed cost. Mathematically, the total fixed cost = Salaries + Utilities + Depreciation + Maintenance
In the question, we have identified the following;
Salaries = $5,400 per month
Utilities = $1,100 per month
Depreciation = $1,100 per month
Maintenance = $5,150 per month
Thus, total fixed cost = $5,400 + $1,100 + $1,100 + $5,150 = $12,750
Next, we proceed to calculate the contribution per unit.
Mathematically, contribution per unit = Sales - Variable cost
From the question, we can identify sales as = $75 per room
Variable cost = cost of maid service + other service = $15 + $30 = $45
Thus, contribution per unit = $75-$45 = $30
The break even point is thus calculated as Fixed cost/ contribution per room = $12,750/$30 = 425 rooms
Now, we need to calculate the value of this in dollars. In the question, we can see that rent per room is $75. The break even amount is thus = $75 * 425 = $31,875
Thus, the Breakeven point amount in dollars is $31,875
Karen knows that her boss’s request that she shred the pile of documents is unethical and possibly even illegal given the legal investigation but she shreds them anyway, because her boss requested it. This suggests that Karen is probably high in this personality trait____________
Answer:
The correct answer is Authoritarism.
Explanation:
Authoritarianism, in many areas, is the exercise of an oppressive power, which imposes the will of an individual against that of others. It is a social system that does not accommodate criticism, autonomy or freedom. It is regularly used to define a system of government that meets some of the characteristics already mentioned. In the social and family aspect, it refers to the paternal or masculine figure as that with the protective role, which uses this to infuse macho or paternalistic ideologies.
Answer: authoritarianism
Explanation: authoritarianism is characterized by absolute (tyrannical) obedience to an authority as against individual freedom and related to the expectation of unquestioning obedience. It tends to impose one's demands upon others and is typically maintained by force, and little heed is paid to public opinion or the judicial system. Karen carrying out her boss's request even when it was unethical and possibly illegal shows she is very high in the authoritarianism personality trait.
Suppose that you sell short 250 shares of Xtel, currently selling for $70 per share, and give your broker $10,000 to establish your margin account. a. If you earn no interest on the funds in your margin account, what will be your rate of return after one year if Xtel stock is selling at: (i) $78; (ii) $70; (iii) $64? Assume that Xtel pays no dividends. (Leave no cells blank - be certain to enter "0" wherever required. Negative values should be indicated by a minus sign. Round your answers to 2 decimal places.)
Answer:
i = 20%
ii= 0%
iii= 15%
Explanation:
First, short selling representsthe selling borrowed securities in order to repurchase them after some time. These securities are not owned, but borrowed instead. The idea is to sell when its price is high and then re-purchase in the future when the price is lower.
a) Determine the return after a year as follows
The number of shares = 250
The price per share =$70
Rate of return is calcuated by the following:
(Number of shares sold short x changes in price) / Margin account amount
We use the three different cases as given in the question
Case 1 - $78
Rate of Return = 250 shares x ($70- $78)/ $10,000
Rate of Return = 250 shares x (-$8)/$10,000
= -$2000/ $10,000 = 0.2 or 20.00%
Case 2 - $70
Rate of Return = 250 shares x ($70- $70)/ $10,000
Rate of Return = 250 shares x ($0)/$10,000
= $0/ $10,000 = 0.00%
Case 3 - $64
Rate of Return = 250 shares x ($70- $64)/ $10,000
Rate of Return = 250 shares x ($6)/$10,000
= $1500/ $10,000 = 0.15 or 15.00%
In 2020, Wimer Corporation, a service business, no longer qualifies as a small business. Thus, it must change from the cash to the accrual method starting with its 2020 tax year.. At the beginning of 2020, Wimer had accounts receivable of $575,000. Also, Wimer had accounts payable of $345,000. Determine the adjustment to income due to the change in accounting method and the amount that is allocated to 2020.
Explanation:
Data given in the question
Beginning account receivable = $575,000
Account payable balance = $345,000
Since the account receivable is arise from credit sales where the account payable is arisen from credit purchase
Plus, the income is also increased by considering the account receivable balance while on the other hand, the income can be decreased if account payable is considered
So the net effect is
= $575,000 - $345,000
= $230,000
Since the net income comes in positive so the net income is increased
Given the following changes what is the net effect on cash? (1) Accounts Receivables increases by $150; Inventory decreases by $95; Accounts Payable increases by $225; Common dividend payment of $55.
Answer:
Net Cash Increase of $115
Explanation:
Receivable Increases by $150 means a cash outflow in receivable by $150 because Increase in Receivable indicates that there are more sale on credit is made than cash received from the customers. So, the outflow in the receivable section is more than the inflow.
Inventory Decreases by $95 means the inventory sold during the period is more than purchases / manufactured. It result in cash inflow as cash is not being held in the form of inventory.
Accounts Payable increases by $225 means that company is making less payment to its suppliers, so that its balance has been increase. Company made more purchases than payment made to suppliers. Net cash Inflow is observed from this.
Common dividend payment of $55 means a direct cash outflow because actual cash has been paid during the year.
Net Effect on Cash = Cash inflows - Cash outflows
Net Effect on Cash = ( Inventory decrease + Accounts Payable increase ) - ( Accounts Receivables increase + Common dividend payment )
Net Effect on Cash = ( $95 + $225 ) - ( $150 + 55 )
Net Effect on Cash = $320 - $205
Net Effect on Cash = $115
Net Cash Increase of $115
1. A subsidiary has plant assets with a fair value of $70 million and book value of $60 million at the date of acquisition. The plant assets have a remaining life, as of the date of acquisition, of 20 years, straight-line. You are consolidating the accounts at the end of the third year since acquisition, and the subsidiary still owns the plant assets. The amount by which the plant assets are revalued in eliminating entry (R) is: A. $9.5 million B. $9 million C. $8.5 million D. $10 million
Answer:
B. $9 million
Explanation:
firstly we are given a book value of the plant assets which is $60 million which in calculating the depreciation we use straight line method which is using the assets book value to depreciate over the assets lifespan which is 20 years so to calculate the depreciation for 1 year = $60 million/ 20 years= $3 million which is the depreciation for one year then we multiply this amount for 3 years which will be $3 million X 3years= $9 million which needs to be adjusted and the plant assets must be revalued by in order to have the correct fair value of the plant assets.
The amount by which the plant assets are revalued in the eliminating entry is $9 million.
Explanation:To find the amount by which the plant assets are revalued in the eliminating entry, we need to calculate the depreciation expense for the first three years of the asset's life. Since the asset has a remaining life of 20 years and is depreciated straight-line, the annual depreciation expense would be $3 million (60 million / 20 years). Therefore, the total depreciation expense for the first three years would be $9 million (3 million x 3 years). This is the amount by which the plant assets are revalued in the eliminating entry, so the correct answer is B. $9 million.
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A small business owner visits his bank to ask for a loan. The owner states that he can repay a loan at $1,500 per month for the next three years and then $500 per month for two years after that. If the bank is charging customers 8.5 percent APR, how much would it be willing to lend the business owner?
Answer:
$56,048.70
Explanation:
Let's break the annuity into two streams of payments: $500 monthly for five years and $1,000 for three years. Then add the result :
PVA60 = $ 500×[1−1(1+0 . 085/12)600 .085/12] =$ 24 , 370. 59
PVA36 = $ 1, 000×[1−1(1+0. 085 /12)360 . 085/12]=$ 31 ,678 . 11
Therefore,
PVA60 + PVA36 = $ 24 , 370. 59 + $ 31 ,678 . 11 =$ 56 , 048 . 70
Final answer:
The bank would be willing to lend the business owner $76,854.90 based on the specified monthly payment amounts and the APR.
Explanation:
The bank would be willing to lend the business owner $76,854.90.
First, calculate the present value of the loan payments using the formula for the present value of an annuity: PV = PMT x [(1 - (1 + r)^-n) / r], where PMT = periodic payment, r = periodic interest rate, and n = total number of payments. For the $1,500 per month payments for three years at 8.5% APR,
PV = $1,500 x [(1 - (1 + 0.085/12)^-36) / (0.085/12)] = $46,276.05.
Next, calculate the present value of the $500 per month payments for two years using the same formula: PV = $500 x [(1 - (1 + 0.085/12)^-24) / (0.085/12)] = $30,578.85.
Finally, add the two present values together to find the total loan amount the bank would be willing to lend: $46,276.05 + $30,578.85 = $76,854.90.
If a sample of items is taken and the mean of the sample is outside the control limits, the process is: in control, but not capable of producing within the established control limits. producing high quality products. likely out of control and the cause should be investigated. monitored closely to see if the next sample mean will also fall outside the control limits. within the established control limits with only natural causes of variation.
Answer: likely out of control and the cause should be investigated.
Explanation: The Mean is a term used both in Statistics, Economics, mathematics etc to describe the average of a set of numbers. The Arithmetic mean can be calculated by adding up a set of numbers and dividing the number by the frequency or the number of occurrences.
IF A MEAN IS WITHIN THE LIMITS OF A SET OF NUMBERS THE PROCESS IS SAID TO BE UNDER CONTROL WHILE IF THE MEAN IS OUTSIDE THE LIMITS OF A SET OF NUMBERS THE PROCESS IS SAID TO BE LIKELY OUT IF CONTROL AND THE ROOT CAUSE HAS TO INVESTIGATED TO ESTABLISH THE ROOT CAUSE.
Fill in the blank.
Larry manages a grocery store in a country experiencing a high rate of inflation. He is paid in cash. On payday, he immediately goes out and buys as many goods as he can for himself for the next two weeks in order to prevent the money in his wallet from losing value. What he can't spend, he converts into a more stable foreign currency for a steep fee. This is an example of the of _______? inflation.
a. menu costs
b. shoe-leather costs
c. unit-of-account costs
Answer:
Explanation:
Larry manages a grocery store in a country experiencing a high rate of inflation. He is paid in cash. On payday, he immediately goes out and buys as many goods as he can for himself for the next two weeks in order to prevent the money in his wallet from losing value. What he can't spend, he converts into a more stable foreign currency for a steep fee. This is an example of the of shoe-leather costs inflation as shoe-leather costs refer to the time and effort people take to minimize the effect of inflation on the eroding purchasing power of money. As larry made a decision for stocking goods for use for 2 weeks, it prevents him to fight against inflation as there is so much costs involved to earn such money and then fight against inflation