The team members pour in their suggestions and Emily takes the final call on the inputs received by them. In this scenario, Emily is portrayed as a consensus leader
Explanation:
Emily, the product development manager of JuzTel, seeks suggestions from her team members for improvising on the company's existing range of cell phones. The team members pour in their suggestions and Emily takes the final call on the inputs received by them. In this scenario, Emily is portrayed as a consensus leader.In consensus leadership, the decision is based on group.consensus is a generally accepted bill by the Democrats and Republicans.It finds proposal which all the team can accept it and support it, with no member opposing it.Define your goals to the employees efficiently.Retained Earnings at the beginning and ending of the accounting period was $850 and $1,800, respectively. If revenues were $3,300 and dividends paid to stockholders were $750, expenses for the period must have been:
A. $1,650.
B. $1,000.
C. $ 650.
D. $1,450.
Answer:
$1,600 (Not given in the options)
Explanation:
Retained earnings is the accumulated balance of an entity's net income over the years. Change between the opening retained earnings and the closing retained earnings of an entity is due to the net income/loss for the period and amount of dividend declared and paid during the period.
Opening retained earnings + net income - dividend = closing retained earnings
850 + net income - 750 = 1800 (all amounts are in $)
net income = 1800 + 750 - 850
= $1700
Net income is the difference between revenue and expenses.
Hence the expenses for the period
= $3,300 - $1,700
= $1,600
In order to encourage employee ownership of the company’s $1 par common shares, Washington Distribution permits any of its employees to buy shares directly from the company through payroll deduction. There are no brokerage fees and shares can be purchased at a 15% discount. During March, employees purchased 50,000 shares at a time when the market price of the shares on the New York Stock Exchange was $12 per share. Required: Prepare the appropriate journal entry to record the March purchases of shares under the employee share purchase plan.
Answer:
The appropriate journal entry to record the March purchases of shares under the employee share purchase plan are as follows:
Debit: Cash ($12 × 85%) × $50,000 = $510,000
Debit: Compensation Expense ($12 × 8%) × $50,000 = $90,000
Credit: Common Stock = $50,000
Paid in Capital – Excess of Par ($50,000 × $11) = $550,000
The following standards for variable manufacturing overhead have been established for a company that makes only one product: Standard hours per unit of output 9.0 hours Standard variable overhead rate $ 15.40 per hour The following data pertain to operations for the last month: Actual hours 2,975 hours Actual total variable manufacturing overhead cost $ 46,595 Actual output 250 units What is the variable overhead efficiency variance for the month
Answer:
$11.165 unfavorable
Explanation:
The formula to compute the variable overhead efficiency variance is shown below:
= (Actual direct labor hours - standard direct labor hours) × variable overhead per hour
where,
Actual direct labor hours is 2,975
And, the standard direct labor hours equal to
= 250 units × 9
= 2,250
Now put these values to the above formula
So, the value would equal to
= (2,975 - 2,250) × $15.40
= $11.165 unfavorable
Ajax Corp's sales last year were $400,000, its operating costs were $362,500, and its interest charges were $12,500. What was the firm's times-interest-earned (TIE) ratio
Answer:
3 times
Explanation:
Times Interest earned is a financial ratio that shows how many times an entity's net income or earnings before interest and taxes can be used to settle the company's interest expense.
It is given as the ratio of earnings before interest and tax to interest expense.
Earnings before interest and taxes is the difference of sales and operating costs.
= $400,000 - $362,500
= $37,500
Hence, the firm's times-interest-earned (TIE) ratio
= $37,500/$12,500
= 3
In an attempt to improve the product, a company that manufactures screwdrivers discusses the modification of each attribute, such as replacing the wooden handle with plastic, providing torque power, adding different screw heads, and so on. This creativity technique is called ________.
A) attribute listing
B) mind mapping
C) morphological analysis
D) lateral analysis
E) reverse analysis
Answer:
The correct answer is letter "C": morphological analysis.
Explanation:
Morphological analysis is a mathematical approach consisting of solving problems using all variables possible which are to be combined and analyzed. When it comes to business, morphological analysis is helpful to outline several possible outcomes given a product so after combining those variables the best result can be selected. Often, more than one result is chosen to increase the diversity of products from where consumers can select.
In an attempt to improve the product, a company that manufactures screwdrivers discusses the modification of each attribute, such as replacing the wooden handle with plastic, providing torque power, adding different screw heads, and so on. This creativity technique is called attribute listing.
The creativity technique described in the question is called attribute listing. This technique involves brainstorming by listing all the various attributes of a product and then considering how each attribute can be improved or modified.
For example, in the context of manufacturing screwdrivers, the company could list attributes such as the handle material, screw head types, and additional functionalities like torque power.
By evaluating and changing each attribute, they aim to enhance the overall product.
On July 1, Year 1, Danzer Industries Inc. issued $40,000,000 of 10-year, 7% bonds at a market (effective) interest rate of 8%, receiving cash of $37,282,062. Interest on the bonds is payable semiannually on December 31 and June 30. The fiscal year of the company is the calendar year.
Answer:
The question says ; Determine the total interest expense for Year 1, using the interest method.
Explanation:
Total interest expense = Issue price x Market rate x TimeIssue price = $37,282,062market rate = 8%Time = December 31 - June 30 which is approximately 6monthsPlugging the values in the equation ;
= 37282062 x 8% x 6/12 = $1491282.48Total interest expense = $1491282.48
In its income statement for the year ended December 31, 2022, Blossom Company reported the following condensed data.
Salaries and wages expenses $567,300
Loss on disposal of plant assets $101,870
Cost of goods sold 1,204,140
Sales revenue 2,696,200
Interest expense 86,620
Income tax expense 30,500
Interest revenue 79,300
Sales discounts 195,200
Depreciation expense 378,200
Utilities expense 134,200
Prepare a multiple-step income statement. (List other revenues before other expenses.)
Answer:
Explanation:
Sales revenue = 2696200
less: sales discount = (195200)
Net sales 2501,000
Less: Cost of goods sold = (1204,140)
Gross profit 1296860
Less: Operating expense
salaries & wages expense 567300
Utilities expense 134200
Depreciation expense 378200
=(1079700)
Profit before interest and taxes 217160
Less: Interest expense = (86620)
130540
Less: tax expense =(30500)
Profit after interest and taxes 100040
jj
To prepare a multiple-step income statement, categorize revenue and expenses and calculate the gross profit, operating income, and net income.
Explanation:To prepare a multiple-step income statement for Blossom Company, we need to categorize the revenue and expense items into different sections. First, we calculate the gross profit by subtracting the cost of goods sold from the sales revenue. Then, we subtract the operating expenses such as salaries and wages expenses, depreciation expense, and utilities expense from the gross profit. Next, we add the interest revenue and subtract the interest expense to calculate the operating income. Finally, we subtract the income tax expense and any other non-operating expenses, such as the loss on disposal of plant assets, to arrive at the net income.
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Production-constrained decision. (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Contribution margin of product. A. unanswered Interference with other production.B. unanswered Contribution margin per unit of limited resource.C. unanswered Selling price of supplier.D. unanswered Sales revenue at split-off point.
Answer:
D. unanswered Sales revenue at split-off point.
Explanation:
Product contribution margin is the economic term used to describe a situation where a product sold generates revenue large enough to pay for all its production and distribution costs and expenses and still generate a profit for the company. In other words, this term refers to the money that is left over from the revenue generated from the sale of the product, after all of your production expenses have been paid. Sales revenue not being answered at the point of separation.
Answer:
nope
Explanation:
nope
Mitchell's money income is $150, the price of X is $2, and the price of Y is $2. Given these prices and income, Mitchell buys 50 units of X and 25 units of Y. Call this combination of X and Y bundle J. At bundle J, Mitchell's MRS is 2. At bundle J, if Mitchell increases consumption of Y by 1 unit, how many units of X must he give up in order to satisfy his budget constraint
Answer:
1 unit of X must be sacrifised to gain a unit of Y, with satisfying Budget Constraint .
Explanation:
Budget Line shows the product combinations that a consumer can buy with given prices & money income (spending all) . Equation : P1X1 + P2X2 = M
Price ratio slope of the budget line i.e = P1/P2 : shows the amount of a good needed to be sacrifised to gain a unit of the other good , given prices & income.
So, Price Ratio : PX / PY = 2 / 2 = 1 in this case; implies 1 unit of Good X is needed to be sacrifised to gain a unit of good Y with given prices & income.
Final answer:
Mitchell must give up 2 units of X to consume an additional unit of Y, due to the equal prices of goods X and Y ($2 each) and his Marginal Rate of Substitution (MRS) being 2 at bundle J. This satisfies his budget constraint without altering his total spending.
Explanation:
In the context of consumer choice theory, when a consumer like Mitchell faces a budget constraint, he must decide how to allocate his income across different goods to maximize his utility. Given that Mitchell's money income is $150, the price of good X is $2, and the price of good Y is also $2, Mitchell initially chooses to buy 50 units of X and 25 units of Y, forming bundle J.
At bundle J, Mitchell's Marginal Rate of Substitution (MRS) is given as 2. This means that Mitchell is willing to give up 2 units of X for every additional unit of Y he consumes in order to maintain the same level of utility. To satisfy the budget constraint, the consumer must adjust consumption when the price or budget changes. If Mitchell wants to increase his consumption of Y by 1 unit without changing his spending, he must calculate how many units of X to forgo.
Given that the price of X and Y are the same, which is $2, and the MRS is 2, Mitchell must give up 2 units of X to gain 1 additional unit of Y to remain on his budget line. Therefore, the budget constraint and the MRS together determine that Mitchell will consume 2 fewer units of X. This allows Mitchell to reallocate the resources spent on X to purchase an additional unit of Y.
Naomi would like to reorder the worksheets in a workbook. What is the easiest method of doing this?
Answer and Explanation:
In Microsoft Office Excel, changing the order of the worksheets in a workbook only takes to left-click on the page the user wants to move, hold the left click and drag it to the position of the workbook desired. The user can also right-click on the worksheet and select "Move or copy" from the window dialog displayed then select where the worksheet should be placed.
Answer:
A) drag and drop
Explanation:
To rearrange the order of the sheets in a workbook, simply click on the workbook, hold, and drag it to its desired location.
Rose Company had no short-term investments prior to this year. It had the following transactions this year involving short-term stock investments with insignificant influence. Apr. 16 Purchased 6,000 shares of Gem Co. stock at $24.00 per share. July 7 Purchased 3,000 shares of PepsiCo stock at $55.00 per share. 20 Purchased 1,500 shares of Xerox stock at $15.00 per share. Aug. 15 Received a(n) $0.95 per share cash dividend on the Gem Co. stock. 28 Sold 3,000 shares of Gem Co. stock at $30.75 per share. Oct. 1 Received a $1.60 per share cash dividend on the PepsiCo shares. Dec. 15 Received a $1.10 per share cash dividend on the remaining Gem Co. shares. 31 Received a $1.00 per share cash dividend on the PepsiCo shares. Required: 1. Prepare journal entries to record the preceding transactions and events.
Explanation:
April 16: Dr Short-term investment (6000*24) 144000
Cr Cash 144000
(To record purchase of shares of Gem co)
July-7: Dr Short-term investment (3000*55) 165000
Cr Cash 165000
(To record purchase of shares of pepsico)
July-20. Dr Short-term investment (1500*15) 22500
Cr Cash 22500
(To record purchase of shares of Xerox)
Aug-15. Dr Cash (6000*.95) 5700
Cr Dividend income 5700
(To record cash dividend of Gemco)
Aug-28. Dr Cash (3000*30.75 ) 92250
Cr Short-term investment (3000*24) 72000
Cr Gain on sale of investment(3000 * 6.75 N#1) 20250
(To record sale of shares of Gemco ).
Oct-1. Dr Cash (1.60 *3000) 4800
Cr Dividend income 4800
(To record cash dividend of pesico)
Dec-15. Dr Cash ( 6000*1.60) 9600
Cr Dividend income 9600
(To record cash dividend or remaining shares of gemco)
Dec-31. Dr Cash (3000*1.00) 3000
Cr Dividend income 3000
(To record cash dividend )
[N#1: 24-30.75= 6.75 *3000 = 20250]
You hold a diversified portfolio consisting of a $10,000 investment in each of 15 different common stocks (i.e., your total investment is $150,000). The portfolio beta is equal to 1.2 . You have decided to sell one of your stocks which has a beta equal to 1.4 for $10,000. You plan to use the proceeds to purchase another stock which has a beta equal to 1.3 . What will be the beta of the new portfolio? Show your answer to 2 decimal places.
Answer:
1.19
Explanation:
The beta of a portfolio can be simply determined by a weighted average of each individual investment's beta. Thus, the portfolio beta after selling $10,000 of a stock with beta equal to 1.4 is:
[tex]B_1 = \frac{150,000*1.2-10,000*1.4}{140,000}\\B_1 =1.185714[/tex]
The beta of a new portfolio after purchasing $10,000 worth of a new stock with beta equal to 1.3 is:
[tex]B_2 =\frac{1.185714*140,000+1.3*10,000}{150,000}\\B_2=1.1933[/tex]
The beta of the new portfolio is 1.19.
Gugenheim, Inc., has a bond outstanding with a coupon rate of 6.4 percent and annual payments. The yield to maturity is 7.6 percent and the bond matures in 20 years. What is the market price if the bond has a par value of $2,000?
Answer:
Price of the bond is $1,757
Explanation:
Coupon payment = 2000 x 6.4% = $128 annually
Number of periods = n = 20 years
Yield to maturity = 7.6% annually
Price of bond is the present value of future cash flows, to calculate Price of the bond use following formula
Price of the Bond = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F / ( 1 + r )^n ]
Price of the Bond = $128 x [ ( 1 - ( 1 + 7.6% )^-20 ) / 7.6% ] + [ 2,000 / ( 1 + 7.6% )^20 ]
Price of the Bond = $128 x [ ( 1 - ( 1.076 )^-20 ) / 0.076 ] + [ 2,000 / ( 1.076 )^20 ]
Price of the Bond = $1295.03 + $462.15
Price of the Bond = $1,757.18
To calculate bond's market price, plug in the coupon rate, yield to maturity rate, number of periods (years till maturity), and the face value into the bond value formula. The outcome will give you the market price of the bond. The market price of the bond may be different from its face value depending on the prevailing interest rates and the creditworthiness of the issuing company.
Explanation:The subject of this question pertains to the financial topic of bond pricing. Gugenheim, Inc., a fictional company, has a bond with a 6.4 percent annual coupon rate and a yield to maturity rate of 7.6 percent. The bond is set to mature in 20 years and has a par value, also known as face value, of $2,000.
To calculate the current market price of the bond, we have to take into account the bond's face value, coupon rate, maturity rate, and yield to maturity. The coupon payments would be $128 per year (6.4% of $2000) for the next 20 years and the return of the face value at the end of maturity. The yield to maturity, which is the rate of return anticipated on a bond if it is held until maturity, is 7.6%.
Calculations:The formula for the value of a bond is C (1-(1 / (1+ r) ^n) / r) + FV / (1 + r) ^n, where C is coupon payment, r is yield to maturity, n is the number of periods, and FV is face value.
Applying the given numbers:
PV = $128 [1-(1/(1 + 0.076)^20) / 0.076] + $2000 / (1 + 0.076)^20
Therefore, the market price or present value of this bond would be the computed price from the above formula, concluding our explanation on bond pricing.
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4-21 (Algo) Reporting an Income Statement, Statement of Stockholders' Equity, and Balance Sheet LO4-2 Green Valley Company prepared the following trial balance at the end of its first year of operations ending December 31. To simplify the case, the amounts given are in thousands of dollars. UNADJUSTED Account Titles Debit Credit Cash 18 Accounts receivable 15 Prepaid insurance 10 Machinery 77 Accumulated depreciation Accounts payable 11 Wages payable Income taxes payable Common stock (8,000 shares) 8 Additional paid-in capital 57 Retained earnings 9 Revenues (not detailed) 78 Expenses (not detailed) 25 Totals 154 154 Other data not yet recorded at December 31 include
Answer:
Income statement
revenue 78000
expenses (25000 )
insurance (7000 )
depreciation (9000 )
EBIT 37000
TAX (11000)
net income 26000
EPS 3.25
STATEMENT OF STOCKHOLDER'S EQUITY
Common stock retained earnings additional paid in capital
opening 8000 9000 57000
net income 26000
closing 8000 35000 57000
BALANCE SHEET
assets
non current assets 154000
machinery 77000
accum depreciation (20000)
carrying value 57000
current assets 36000
prepaid insurance 3000
cash 18000
accounts receivables 15000
total assets 190000
Equity and liabilities
stockholdr's equity 100000
common stock 8000
Retaine earnings 35000
paid in capital 57000
Liabilities 90000
current liabilities 90000
Accounts payable 11000
wagages payable 4000
income tax payable 75000 balancing figure
Explanation:
missing information;
Other data not yet recorded at December 31 include:
Insurance expired during the current year, $7.
Wages payable, $4.
Depreciation expense for the current year, $9.
Income tax expense, $11.
Required:
1. Using the adjusted balances, prepare an income statement for the current year. (Round "Earnings per share" to 2 decimal places. Enter your answers in thousands.)
2. Using the adjusted balances, prepare statement of stockholders’ equity for the current year. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.)
3. Using the adjusted balances, prepare balance sheet for the current year. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands.)
During the current year, Merkley Company disposed of three different assets. On January 1 of the current year, prior to the disposal of the assets, the accounts reflected the following:Asset Original Cost Residual Value Estimated Life Accumulated Depreciation (straight line)Machine A $21,000 $3,000 8 years $15,750 (7 years)Machine B 50,000 4,000 10 years 36,800 (8years)MachineC 85,000 5,000 15 years 64,000 (12 years)The machines were disposed of during the current year in the following ways:a. Machine A: Sold on January 1 for $5,000 cash.b. Machine B: Sold on December 31 for $10,500; received cash, $2,500, and an $8,000 interest-bearing (12 percent) note receivable due at the end of 12 months.c. Machine C: On January 1, this machine suffered irreparable damage from an accident. On January 10, a salvage company removed the machine at no cost.Prepare journal entries for the above transactions.
Answer:
See attached picture for detailed answer.
Explanation:
See attached picture.
Journal Entries for recording the Merkley Company's transactions are as follows:
January 1:
Debit Sales/Disposal of Assets $5,250
Debit Accumulated Depreciation $15,750
Credit Equipment (Machine A) $21,000
To transfer the assets and accumulated depreciation to Sales/Disposal Account.
Debit Cash $5,000
Credit Sales/Disposal of Assets $5,000
To record the cash receipts from the disposal.
December 31:
Debit Sales/Disposal of Assets $13,200
Debit Accumulated Depreciation $36,800
Credit Equipment (Machine B) $50,000
To transfer the assets and accumulated depreciation to Sales/Disposal Account.
Debit Cash $2,500
Debit Notes Receivable $8,000
Credit Sales/Disposal of Assets $10,500
To record the cash receipts and notes receivable from the disposal.
January 1:
Debit Sales/Disposal of Assets $21,000
Debit Accumulated Depreciation $64,000
Credit Equipment (Machine C) $85,000
To transfer the assets and accumulated depreciation to Sales/Disposal Account.
Data Analysis:
Asset Original Cost Residual Value Estimated Life Accumulated
Depreciation
(straight line)
Machine A $21,000 $3,000 8 years $15,750 (7 years)
Machine B 50,000 4,000 10 years 36,800 (8 years)
Machine C 85,000 5,000 15 years 64,000 (12 years)
Machine A on January 1:
Sales of Assets = $5,000 (cash)
Book value = $5,250 ($21,000 - $15,750)
Loss on sale = $250 ($5,250 - $5,000)
Sales/Disposal of Assets $5,250 Accumulated Depreciation $15,750 Equipment (Machine A) $21,000
Cash $5,000 Sales/Disposal of Assets $5,000
Machine B on December 31:
Sales of Assets = $10,500 (Cash $2,500 Notes Receivable $8,000)
Book value = $13,200 ($50,000 - $36,800)
Loss on sale = $2,700 ($13,200 - $10,500)
Sales/Disposal of Assets $13,200 Accumulated Depreciation $36,800 Equipment (Machine A) $50,000
Cash $2,500 Notes Receivable $8,000 Sales/Disposal of Assets $10,500
Machine C on January 1:
Sales of Assets = $0
Book value = $21,000 ($85,000 - $64,000)
Loss on sale = $21,000 ($21,000 - $0)
Sales/Disposal of Assets $21,000 Accumulated Depreciation $64,000 Equipment (Machine A) $85,000
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A restaurant is considering adding fresh brook trout to itsmenu. Customers would have the choice of catching theirown trout from a simulated mountain stream or simply ask-ing the waiter to net the trout for them. Operating thestream would require $11,925 in fixed costs per year.Variable costs are estimated to be $6.80 per trout. The firmwants to break even if 900 trout dinners are sold per year.
What should be the price of the new item?
Answer:
Selling price = $20.05
Explanation:
The break even point is the level of activity where the total cost of is exactly equal to the total revenue. At this point, the business makes no profit and no loss, because the total contribution is also equal to the total fixed costs.
Contribution is the excess of sales revenue over variable cost
Total contribution = (S.p - VC per unit) × unit sold
So we can determine the selling price per unit by equating the total contribution to the the total fixed cost as follows:
Step 1
Determine the total contribution
= ( S.P - 6.80) × 900
Step 2
Equate the total contribution to the total fixed cost and solve for S.P
(S.P - 6.80) × 900 = 11,925. Lets substitute S.P with x
(X-6.80) × 900 = 11,925
900X -6,120 = 11,925
900X = 11,925 + 6,120
900X = 18045
X = 18,045/900
X = $20.05
Selling price = $20.05
Robert is the sole shareholder and CEO of ABC, Inc., an S corporation that is a qualified trade or business. During the current year, ABC has net income of $303,500 after deducting Robert's $91,050 salary. In addition to his compensation, ABC pays Robert dividends of $212,450. a. What is Robert's qualified business income? $303,500 (This answer is correct) b. Would your answer to part (a) change if you determined that reasonable compensation for someone with Robert's experience and responsibilities is $181,050? $________
Answer: $303,500
No
Explanation: Qualified business income QBI allows sole shareholders of eligible businesses (S corporations, sole proprietorship) such as Robert to lessen their tax burden by up to 20 percent. In this case, 20% of $303,500 can be deducted.
QBI will not change as reasonable compensation is not actual compensation, so this does not apply to QBI.
However, If his salary increases to $181,050, this would make Robert ineligible to qualify for the deduction as his income is more than the $157,500 threshold that makes a single taxpayer eligible for QBI.
This amount is $315,000 for a married couple filing a joint return.
Assume Oliver wants to earn a return of 10.50% and is offered the opportunity to purchase a $1,000 par value bond that pays a 8.75% coupon rate (distributed semiannually) with three years remaining to maturity. The following formula can be used to compute the bond’s intrinsic value:
Intrinsic ValueIntrinsic Value = A/(1+C)^1+A/(1+C)^2+A/(1+C)^3+A/(1+C)^4+A/(1+C)^5+A/(1+C)^6+B/(1+C)^6
Based on this equation and the data, it is _______ (unreasonable/reasonable) to expect that Oliver’s potential bond investment is currently exhibiting an intrinsic value less than $1,000.
Now, consider the situation in which Oliver wants to earn a return of 11.75%, but the bond being considered for purchase offers a coupon rate of 8.75%. Again, assume that the bond pays semiannual interest payments and has three years to maturity. If you round the bond’s intrinsic value to the nearest whole dollar, then its intrinsic value of _______ (rounded to the nearest whole dollar) is _______ (equal to/greater than/less than) its par value, so that the bond is ______ (trading at premium/par/discount).
Answer and Explanation:
1.
A is semi annual coupon=43.75
B is par or face value=1000
C is semi annual required return=5.25%
2.
Reasonable because coupon rate is less than ytm
3.
=(8.75%*1000)/11.75%*(1-1/(1+11.75%/2)^6)+1000/(1+11.75%/2)^6=925.95
4.
Less than
5.
Discount
For variable A
coupon rate = 8.75%
semiannually = [tex]\frac{8.75}{2}[/tex] = 4.375%
Semiannual coupon rate = 4.375% * 1000
= $43.75
For variable B
Bond par value = 1000
For variable C
Coupon rate = 10.5% annually
Semiannually = [tex]\frac{10.5}{2} =5.25[/tex]%
She wants a rate of 11.75% annually
Semiannually = [tex]\frac{11.75}{2} = 5.875%[/tex]
The time to maturity = 3 years
Semi annual period rate to maturity = 5.25
[tex]\frac{43.75}{1.05875} +\frac{43.75}{1.05875^2} +\frac{43.75}{1.05875^3} +\frac{43.75}{1.05875^4} +\frac{43.75}{1.05875^5} +\frac{43.75}{1.05875^6} +\frac{1000}{1.05875^6}[/tex]
= 41.32+39.029+36.8634.82+32.88+31.07+709.9
= 925.948
From the data and the calculation above we can see that the intrinsic value is $925.9 which is less than the par value of $1000.
This is reasonable given that the coupon rate is lower. Rounding up the intrinsic value we see that it is lower than the par value. Therefore this is a discount.
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Voltar Company manufactures and sells a telephone answering machine. The company's contribution format income statement for the most recent year is given below:
Total Per unit Pct. of sales (Ratios)
Sales $1,200,000 $60 100%
Less: variable expenses 900,000 45 ?%
Contribution margin 300,000 15 ?%
Less: fixed expenses 240,000
Net operating income $60,000
(a) What is the Contribution Margin (CM) Ratio (or percent of sales)?
(b) Calculate break-even point both in total units and total sales dollars.
Answer:
A. Contribution Margin Ratio = 25%
B. Break even point (In dollars) = $960,000
Break even point (in units) = 16,000
Explanation:
The computation of Contribution Margin Ratio and break-even point both in total units and total sales dollars is given below:-
A. Contribution Margin Ratio = Contribution ÷ Sales × 100
= $300,000 ÷ 1200,000 × 100
= 25%
B. Break even point (In dollars) = Fixed cost ÷ Contribution margin ratio
= $240,000 ÷ 25%
= $960,000
Break even point (in units) = Break even point ÷ price per unit
= $960,000 ÷ $60
= 16,000 Units
Final answer:
The Contribution Margin (CM) Ratio for Voltar Company is 25%. The break-even point is 16,000 units or $960,000 in sales dollars, essential for understanding financial planning and strategy.
Explanation:
Answering the question provided by the student about Voltar Company's telephone answering machine, we first address part (a) which asks for the Contribution Margin (CM) Ratio. The CM ratio is calculated by dividing the contribution margin by total sales. In this case, the contribution margin is $300,000, and total sales are $1,200,000, making the CM ratio 25% (300,000 / 1,200,000).
For part (b), finding the break-even point involves calculating both the number of units and the total sales dollars needed to cover all expenses. The break-even point in units is found by dividing the total fixed expenses by the contribution margin per unit, which in this case would be $240,000 / $15 = 16,000 units. To find the break-even point in sales dollars, multiply the break-even units by the sale price per unit, resulting in 16,000 units * $60 = $960,000.
These calculations help businesses understand how many units they need to sell to cover their costs and start generating profit, a crucial aspect of financial planning and strategy. The CM ratio and break-even analysis are fundamental concepts in business operations.
Marketing scholars who believe the ________ believe three exposures to an advertisement are needed: one to make consumers aware of the product, a second to show consumers the relevance of the product, and a third to remind them of the product
Answer:
C) three-hit theory
Eleven years ago, you deposited $3,200 into an account. Seven years ago, you added an additional $1,000 to this account. You earned 9.2 percent, compounded annually, for the first 4 years and 5.5 percent, compounded annually, for the last 7 years. How much money do you have in your account today
Answer:
The money which the person have in account today amounts to $8,073.91
Explanation:
The amount of money which the person have in account today is computed as:
Future Value = {Present Value × (1+ Percent) ^ Number of years }+ {Present Value × (1+ Percent) ^ Number of years}
where
Present value is $3,200
Percent is 9.2%
Number of years is 4 years
Present value is $1,000
Percent is 5.5%
Number of years is 7 years
Putting the values above:
Future value = {$3,200 × (1+ 0.092) ^ 4 }+ {$1,000 × (1+ 0.055) ^ 7}
Future value = $8,073.91
Candice is a jewelry shop owner, specializing in beaded necklaces. For each of the following inputs, classify each item as a variable input or a fixed input in the long run.
i. Shipping
ii. Chairs
iii. Upper Managment salary
iv. Beads
v. Hourly Labour
vi. Computers
vii. 2 years Lease on office and rental space
This evaluation categorizes shipping, beads, and hourly labor as variable inputs, while chairs, upper management salary, computers, and 2 year lease on office and rental space are classified as fixed inputs in a jewelry shop's production.
Explanation:In the context of business and economics, variable inputs are those that can be adjusted or changed based on the production needs, while fixed inputs are those that remain constant regardless of the production level. In the long run, all factors of production are variable. However, for the exercise, we consider a certain level of fixedness.
Shipping - Variable Input (as it changes with the number of goods sold)Chairs - Fixed Input (since the number of chairs would likely remain constant regardless of production) Upper Management salary - Fixed Input (Salaries for permanent staff are usually considered fixed unless they work overtime or their salary is performance-based)Beads - Variable Input (as the quantity needed would vary with the number of necklaces being made)Hourly Labour - Variable Input (as it alters based on the hours of work needed)Computers - Fixed Input (as they are a one-time purchase and would not change with production)2 years Lease on office and rental space - Fixed Input (since it's a constant cost over its term, irrespective of production)Learn more about Fixed and Variable Inputs here:https://brainly.com/question/32601953
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Depreciation represents The consumption of capital in the production process. A loss of productive capability as a result of the inefficient use of resources. Wasted capital. Gross investment plus net investment.
Answer:
The consumption of capital in the production process.
Explanation:
Depreciation can be defined as the decrease of the recorded cost of a fixed asset in a systematic way until the value of the asset becomes zero or negligible.
Depreciation is referred to as 'consumption of physical capital'. It is the difference that exists between gross investment and net investment.
Examples of fixed assets include: buildings, furniture, office equipment, machinery. A land is the only oddity. A land cannot be depreciated as the value of land appreciates with time.
Final answer:
Depreciation is the loss of value in capital goods due to wear and tear or obsolescence. It's measured as the cost of production and subtracted from gross investment to determine net investment, impacting the overall capital stock of an economy. Depreciation also represents a significant percentage of Gross Domestic Income.
Explanation:
Depreciation is an important concept in economics and accounting that refers to the wear and tear or obsolescence of capital goods like machinery and buildings during the production process. As capital is utilized, it gradually loses value due to factors such as physical deterioration and technological advancements. This reduction in value is calculated as depreciation and is reported by entities such as the Commerce Department as the "consumption of fixed capital".
The concept of gross and net investment relates directly to depreciation. Gross investment represents the total amount invested in new capital, while net investment is obtained by subtracting depreciation from gross investment. Positive net investment indicates that the capital stock of an economy is growing, while negative net investment signals a decline in the capital stock.
Depreciation is not just a measure of the decline in value; it also represents the cost of production, as it is part of the price for goods and services. Thus, it contributes to the income generated in the production process. In macroeconomic terms, depreciation helps to understand the lifespan of various capital goods, and it accounted for about 13% of Gross Domestic Income (GDI) in 2008.
Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $72,000 each month. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. (Do not round intermediate calculations. Round "CM ratio" to the nearest whole percentage (i.e., 0.234 should be entered as "23") and other answers to the nearest whole number.)
Answer:
1. New CM RATIO = 0.4
2. BEP (unit sales) = 21,000 units
BEP (in dollars) = $630,000
Explanation:
The original data table is attached.
1. CM Ratio:
The contribution margin is what is left after all variable expenses is subtracted from sales.
The CM Ratio is that amount divided by sales. So we can say:
CM Ratio = (Sales - Var Expenses)/Sales
From the table, we see sales as 585,000 and variable expenses as 409,500
This is original data, but we are given that $3 variable expense per unit is LESS. So, we take that into account and find new variable expense.
Since 19,500 units accounts to variable expense of 409,500:
Var Exp Per Unit = 409,500/19,500 = 21
Now, $3 less per unit, so Var Exp Per Unit (NEW) = 21 - 3 = 18
So, total Var Exp (NEW) = 19,500 units * 18 per unit = 351,00
New CM RATIO = (585000 - 351000)/585000 = 0.4
2. BEP (units) and BEP (dollars)
The Break-Even Point has formula:
BEP (units) = Total fixed cost/ CM Per Unit
Fixed Cost previously was 180,000. Now, 72,000 increased because of automation. Hence,
Fixed Cost (NEW) = 180000 + 72000 = 252,000
Also:
CM Per Unit is Sale Price Per Unit - Var Cost Per Unit
We know Sale Price is $30 and NEW VAR COST PER UNIT is 18
So, CM Per Unit = 30 - 18 = 12
BEP (units) = 252,000/12 = 21,000 units
BEP (in dollars) = Total Fixed Cost/CM Ratio = 252000/0.4 = $630,000
You have just leased a car that has monthly payments of $385 for the next 5 years with the first payment due today. If the APR is 7.32 percent compounded monthly, what is the value of the payments today?
Answer:
Total Value =5563.131709
Explanation:
using the annuity formula to find out the present value of lease rentals
p=R*(1-(1+i)^-n)/i
Total rental monthly =5*60 = 60
I=7.32% monthly
R=385$ monthly
Since we have:
Value of the first is same i.e $385
Value of remaining 59 payments as follows
P=385*(1-(1+7.32%)^-59)/7.32%
P=385*(1-0.015482491 )/7.32%
P=385* 0.984517509 /7.32%
P=385*13.44969275
P=5178.131709
Value of 59 rental = 5178.131709
Add: Value of 1st rental = 385
Total Value =5563.131709
In March 2007March 2007, the U.S. unemployment rate was 4.44.4 percent. In August 2008 August 2008, the unemployment rate was 6.16.1 percent. Predict what happened to unemployment between March 2007March 2007 and August 2008 August 2008, if the labor force was constan
Answer:
A Recession happened.
Explanation:
When the market sees a recession we see an increase in the unemployment rate due to cyclical unemployment whenever there in a business cycle even though the labor force was constant but in a recession companies face a lot of costs which become higher than their revenue so for example when there is a recession the cost of producing 1 more unit is actually higher than the revenue a firm gets from producing that 1 unit because marginal cost increases at a decreasing rate so they have to lay off people at a firm on that unit of production to maximize revenues.
Required information Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $ 15,000 $ 15,000 Land* 120,000 440,000 Totals $ 135,000 $ 455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) e. Prepare a tax basis balance sheet for Albee LLC showing the tax capital accounts for the members. What is Kevan’s share of the LLC’s inside basis? (Enter any capital account with a debit balance as a negative amount.)
Answer: A: $0.None of the members recognize gain because their debt relief was not in excess of their bases in their LLC interest prior to any debt relief.
B: $55,000
C: $285,000
D: $625,000 Albee, LLC takes a $135,000 carryover basis in the assets Kevan contributes and a $490,000 basis in the total cash the other two members contributed.
Explanation: check attached file
Massa Machine Tool expects total sales of $60,000. The price per unit is $10. The firm estimates an ordering cost of $25 per order, with an inventory cost of $0.70 per unit. What is the optimum order size?
Answer:
The optimal order size is 654.
Explanation:
As we know that: EOQ = Squareroot (2DS/H)
where :
S= ordering cost = $25 per order
H = Holding cost per unit = 0.70 per unit
D= Annual demand,sales = 60000/10 = 6000 units
Solution:
= Squareroot ( 2 * 6000 * 25 ) / 0.70
= Squareroot (300000/0.70)
= Squareroot (428571)
EOQ = 654
Final answer:
The optimum order size is 6000 units.
Explanation:
To determine the optimum order size, we need to consider the total cost and the quantity of units. The formula for total cost is (ordering cost + inventory cost), and the formula for quantity of units is (total sales / price per unit).
In this case, the ordering cost is given as $25 per order, and the inventory cost is $0.70 per unit. The total sales are $60,000, and the price per unit is $10.
Using the formulas, we can calculate the optimum order size:
Calculate the quantity of units: 60000 / 10 = 6000 unitsCalculate the ordering cost: 25Calculate the inventory cost: 0.7Calculate the total cost: (25 + 0.7) * 6000 = 15300Therefore, the optimum order size is 6000 units.
WesternBioLabs Inc. is in the process of laying off 10% of its shipping and receiving employees. At the same time, it is hiring new hourly staff for night shifts. Which of the following terms best describes this process?
a. Churning.
b. Restructuring.
c. In violation of the WARN Act.
d. Spinning off employees.
Answer:
A. Churning
Explanation:
Employee Churning is also known as employee turn-over which is an act of laying off employees while recruiting new ones. It is a measure always taken to conserve a company's limited resources. The turnover rate is given as the percentage of employees being laid off or leaving workers over a period of time. There are a lot of factors contributing to churning such as downsizing through attrition either due to recession or scarcity of company's resources.
Gregory Trout has just received a memo explaining that because of his department's success with the newly developed Trout, Inc., that his request for three new employees has been approved. Gregory now faces the challenge of working with the areas of human resource management in recruiting, selecting, training and maintaining effective employees.
In recruiting and selecting employees for the new positions, Gregory will apply which human resourcemanagement goal?
a.Implementing strategies
b.Managing talent
c.Maintaining an effective workforce
d.Finding the right people
e.Controlling strategies
Answer:
Right choice: d.
Explanation:
As the George's area of expertise had effectively fulfilled the requirements of the new evolved Trout , Inc. IT may happen that work will be expanded. This will require Goerge to build the workforce those are having ranges of abilities that coordinates the Trout, Inc. needs. Hence, while enlisting and selecting for the new position Georgy will apply HRM objective of finding the correct arrangement of individuals for the necessary undertaking.