Answer:
a. equal to 1.
Explanation:
Elasticity of demand measures the responsiveness of quantity demanded to changes in price.
Elasticity of demand = percentage change in quantity demanded / percentage change in price.
1% / 1 % = 1
Demand is unit elastic.
I hope my answer helps you
A firm has borrowed $5,000,000 for 3 years at 10% interest, compounded annually. It makes no payments until the loan is due, and then pays the loan off as a lump sum. What is the payoff amount at the end of year 3?
Answer:
$6,655,000
Explanation:
[tex]A = P(1\ +\ r)^{n}[/tex]
wherein, A= Amount
P= Principal
R= Rate of interest per annum
n = term to maturity
Pay off amount at the end of year 3 = $5,000,000[tex](1\ +\ .10)^{3}[/tex]
Amount = $5,000,000 × 1.331 = $ 6,655,000
Amount due of a borrowing is equal to the money borrowed initially compounded at a rate of interest for a known period.
Above. rate of interest is 10%, since the money has been repaid only upon due date, three year compounding of the said sum at 10% per annum rate of interest yields the payoff amount which is $6,655,000
RST Company produces a product that has a variable cost of $6 per unit. The company's fixed costs are $30,000. The product sells for $10 per unit. RST desires to earn a profit of $20,000. The contribution margin per unit is $
Answer:
$4
Explanation:
Contribution margin is the difference between sales and variable cost. As such, the contribution margin per unit is the difference between the sales per unit and the variable cost per unit.
Given that
variable cost per unit = $6
Selling price per unit = $10
The contribution margin per unit is
= $10 - $67
= $4
Look at Exercise 19.2. Compute the opportunity costs of producing sweaters and wine in both France and Tunisia. Who has the lowest opportunity cost of producing sweaters and who has the lowest opportunity cost of producing wine? Explain what it means to have a lower opportunity cost.
Answer:
Answer Illustration : Opportunity Cost of producing Wine is lesser in France, Opportunity Cost of producing Sweaters is lesser in Tunisia. So, France has comparative advantage in Wine, Tunisia in Sweater.
Explanation:
Opportunity Cost is the cost of next best alternative foregone while choosing an alternative.
Opportunity Cost of producing Sweaters & Wine in France & Tunisia are quantities of other goods (Sweaters or Tunias) sacrifised while choosing either. Sweater Opportunity Cost - Wines sacrifised, Wine Opportunity Cost - Sweaters sacrifised.
The country has a comparative advantage in a good if it can produce it with relatively less opportunity cost (in terms of other good sacrifised) than other country.
Ex : Production Possibilities
Wine Sweater Trade off (Wine :Sweater)
France 10 5 1:0.5 or 2:1
Tunisia 8 24 1:3 or 0.33:1
France produces Wine with lesser opportunity cost (sweater sacrifised) than Tunisia [0.5 sweater < 3 sweaters] ; it has comparative advantage in Wine. Tunisia produces Sweater with less opportunity cost (wine sacrifised) than France [ 0.33 wine < 2 wines] ; it has comparative advantage in TunisiaConsider a used car market with asymmetric information. The owners of used cars know what their vehicles are worth but have no way of credibly demonstrating those values to potential buyers. Thus, potential buyers must always worry that the used car they are being offered may be a low quality "lemon."
a. Suppose that there are equal numbers of good and bad used cars in the market and that good used cars are worth $13,000 while bad used cars are worth $5,000. What is the average value of a used car?
b. By how much does the average value exceed the value of a bad used car? By how much does the value of a good used car exceed the average value?
c. Would a potential seller of a good used car be willing to accept the average value as payment for her vehicle?
d. If a buyer negotiates with a seller to purchase the seller’s used car for a price equal to the average value, is the car more likely to be good or bad?
e. Will the used-car market come to feature mostly—if not exclusively—lemons? How much will used cars end up costing if all the good cars are withdrawn?
Answer:
a. $9,000
b. $4,000 & $4,000
c. The seller is probably not willing to accept the average value as payment for her vehicle.
d. The car is more likely to be bad.
e. The used car market will still have both good and bad cars. Used cars end up costing the same if all the good cars are withdrawn. In the long run, prices of used cars may fall.
Explanation:
a. Because there are equal numbers of good and bad used cars in the market, the probability that a car is a good car is equal to the probability that a car is a bad car (=0.5). So the average value of a used car is calculated by taking the probability that a car is a good car (0.5), multiplying that by the value of a good car ($13,000), and adding to that the probability that a car is a bad car (0.5), multiplying that by the value of a bad car ($5,000). To put in an equation, we have
Average value of used car = Average value of good used car + Average value of bad used car
= (0.5 x $13,000) + (0.5 x $5,000)
= $9,000
b. The average value exceeds the value of a bad used car by:
Average value of used car - Average value of bad used car
= $9,000 - $5,000
= $4,000
The value of a good used car exceeds the average value by:
Average value of good used car - Average value of used car
= $13,000 - $9,000
= $4,000
c. A potential seller of a good used car would know that her car was worth $13,000, more than the average value ($9,000). Therefore, it would not make sense to sell her vehicle for $9,000. The seller would probably not be willing to accept the average value as payment for her vehicle.
d. If a buyer negotiates with a seller to purchase the seller's used car for a price equal to the average value, the car is more likely to be bad. As in c, a seller of a good used car would probably not be willing to accept the average value as payment for her vehicle.
e. The used car market will always have good and bad used cars because the average price does not apply in the market. If buyers know that they are negotiating the price of a car down to a much lower price, it is likely that the car they are buying are lemons. Likewise, buyers who want good cars may be willing to pay a bit more to ensure that they are not getting bad cars.
If all the good cars are withdrawn, the price of used cars will stay unchanged as buyers do not know whether cars are good or bad (asymmetric information). However, in the long run, buyers will know that and get more information than they had before, so prices will probably fall.
Rosalie is organizing a circus performance to raise money for a charity. She is trying to decide how much to charge for tickets. From past experience, she knows that the number of people who will attend is a linear function of the price per ticket. If she charges 5 dollars, 1065 people will attend. If she charges 7 dollars, 805 people will attend. How much should she charge per ticket to make the most money? (Round your answer to the nearest cent.)
To maximize total revenue for a charity circus, Rosalie should charge approximately $8.17 per ticket. This was determined by calculating the demand function's slope from given data points and solving for the price that results in zero derivative of the revenue function.
Explanation:To determine how much to charge per ticket to make the most money for Rosalie's charity circus, we need to find the price that maximizes total revenue. This can be approached by understanding the concept of a downward-sloping demand curve and the relationship between ticket price and number of attendees. Given two price points – 5 dollars with 1065 attendees and 7 dollars with 805 attendees – we can find the slope of the demand function and then determine the revenue-maximizing point. Total revenue is calculated by multiplying the price per ticket by the number of tickets sold.
Calculating the slope, m, of the linear demand function we get:
m = (Change in number of attendees) / (Change in ticket price) = (1065 - 805) / (5 - 7) = 260 / -2 = -130.
This means that for every dollar the price increases, 130 fewer tickets are sold. To represent the demand function, we can use the point-slope form:
y - y₁ = m(x - x₁), where y is the number of attendees, x is the price, y₁ is one number of attendees we know, and x₁ is the price we know. Plugging in the values we get:
Number of attendees = 1065 + (-130)(Price - 5).
Now we calculate revenue (R) by multiplying the price by the number of attendees for that price:
R = Price × Number of attendees = Price × [1065 - 130(Price - 5)].
To maximize revenue, we differentiate R with respect to Price and set the derivative equal to zero, then solve for Price:
R' = 1065 - 260 × Price + 130 × 5,
R' = 0 when Price = $8.17 (rounded to the nearest cent).
Therefore, to maximize total revenue, Rosalie should charge approximately $8.17 per ticket.
Ryan Olson organized a new company, MeToo, Inc. The company provides networking management services on social network sites. You have been hired to record the following transactions. a. May 1: Issued 850 shares of common stock to investors for $20 per share. b. May 15: Borrowed $46,500 from the bank to provide additional funding to begin operations; the note is due in two years. c. May 31: Paid $4,800 for a one-year fire insurance policy with coverage starting June 1. TIP: For convenience, simply record the full amount of the payment as an asset (Prepaid Insurance). At the end of June, this account will be adjusted to its proper balance. d. June 3: Purchased furniture for the store for $22,600 on account. The amount is due within 30 days. e. June 5: Placed advertisements in local college newspapers today for a total of $715 cash. f. June 9: Provided services for $605 cash. g. June 14: Made full payment for the furniture purchased on account on June 3.
Answer:
MeToo, Inc.
Journal Entries
Sr. No Accounts Dr. Cr.
May 1 Cash 17000
Common Stock 17000
Issued 850 shares of common stock to investors for $20 per share
May 15: Cash 46,500
Notes Payable 46,500
Borrowed $46,500 from the bank to provide additional funding to begin operations; the note is due in two years.
May 31: Prepaid Insurance 4800
Cash 4800
Paid $4,800 for a one-year fire insurance policy with coverage starting June 1. TIP: For convenience, simply record the full amount of the payment as an asset (Prepaid Insurance). At the end of June, this account will be adjusted to its proper balance.
June 3: Furniture 22600
Accounts Payable 22600
Purchased furniture for the store for $22,600 on account. The amount is due within 30 days.
June 5: Advertisement 715
Cash 715
Placed advertisements in local college newspapers today for a total of $715 cash.
June 9: Cash 605
Services Revenue 605
Provided services for $605 cash.
June 14: Accounts Payable 22600
Cash 22600
Made full payment for the furniture purchased on account on June 3.
June 30 Insurance Expense 400
Prepaid Insurance 400
$ 4800/12 = $ 400 adjustment of one month insurance expense.
Flint corporation reported net income of 391320 in 2017 and had 206000 shares of common stock outstanding throughout the year. Also oustanding all year were 570000 options to purchase common stock at 12 per share. The average market price of the stock druing the year was 15. Compute diluted earnings per share.
Answer:
$1.23
Explanation:
The computation of the diluted earnings per share is shown below:
Diluted earning per share = Net income ÷ weighted number of common stock outstanding
where,
Net income is $391,320
Weighted average number of outstanding shares equal to
= 206,000 shares + 114,000 shares
= 320,000 shares
The 114,000 shares is
= 570,000 ÷ $15 × $12
= 456,000
Now 570,000 - 456,000 = 114,000 shares
So, the diluted earning per share
= $391,230 ÷ 320,000 shares
= $1.23
An increase in the price of a good will a. increase supply. b. decrease supply. c. increase quantity supplied. d. decrease quantity supplied.
Answer: c. Increase in quantity supplied.
Explanation: an increase in the price of a good would lead to an increase in the quantity of the good supplied. This follows the fundamental economic theory of supply or the law of supply which states that all else being equal, an increase in the price of good and services would lead to a corresponding increase in the quantity of the good or services supplied. This is quite true and the rationale behind it is the potential increase in returns per unit of good sold to the supplier as a result of the increase in price.
An increase in price of a good will increase the quantity supplied. This is because producers find it more profitable to sell the good at higher prices. However, it does not alter the overall supply of the good, which is determined by other factors.
Explanation:The key to understanding this question lies in the difference between the supply and quantity supplied. In simple terms, 'supply' refers to the amount of goods that producers are willing and able to sell at all possible prices, whereas 'quantity supplied' refers to the amount of goods that producers are willing and able to sell at a specific price.
When the price of a good increases, the quantity that producers are willing and able to sell also increases. This is because at higher prices, it becomes more profitable for producers to make and sell the good, hence they would choose to sell more. Therefore, an increase in price of a good will increase quantity supplied. However, it does not change the overall supply of a good; the supply is determined by other factors such as costs of production, technology, and expectations about future prices.
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Which of the following sentences with internal sentence interrupters use correct punctuation? Check all that apply. The VP of finance, not the CFO, works with the departmental managers to develop internal budgets. The management team discussed implementing an intranet system that included a secure chat function. Our graduates, having had two full semesters of workplace communication, always do well in the job market. Consequently they lost control of the situation. Precipice Financial’s hedge fund which produces extremely high returns includes very risky investments.
Answer:
The correct answer is The VP of finance, not the CFO, works with the departmental managers to develop internal budgets. and Our graduates, having had two full semesters of workplace communication, always do well in the job market.
Explanation:
We use the sentence interruoters to indicate information that is not relevant to the sentence. This information, not being important, must be separated by two commas.
What is inside the comma should not interfere with the final meaning of the sentence and its understanding. We could remove that part and the sentence should continue to make sense.
In this case we have the following sentences:
The VP of finance, not the CFO, works with the departmental managers to develop internal budgets.
Our graduates, having had two full semesters of workplace communication, always do well in the job market.
Let's see what happens if we remove what is located between the commas:
The VP of finance works with the departmental managers to develop internal budgets.
Our graduates always do well in the job market.
As we can see, both sentences still make sense, which indicates that this information was not relevant and was well punctuated by being located between two commas.
Final answer:
Two sentences correctly use punctuation with internal sentence interrupters, demonstrating the importance of proper punctuation in conveying clear and precise meaning and they are The VP of finance, not the CFO, works with the departmental managers to develop internal budgets and Our graduates, having had two full semesters of workplace communication, always do well in the job market.
Explanation:
Of the provided sentences, two use correct punctuation with internal sentence interrupters:
The VP of finance, not the CFO, works with the departmental managers to develop internal budgets.Our graduates, having had two full semesters of workplace communication, always do well in the job market.Correct punctuation around internal sentence interrupters is crucial for conveying the intended meaning precisely and clearly. Internal interrupters such as non-essential clauses, appositives, and parenthetical elements should be separated from the main clause by commas or other proper punctuation to avoid confusion or misinterpretation. In the provided examples, these elements are appropriately offset with commas to maintain the clarity of the sentences.
Rahul needs a loan and is speaking to several lending agencies about the interest rates they would charge and the terms they offer. He particularly likes his local bank because he is being offered a nominal rate of 10%. But the bank is compounding bimonthly (every two months). What is the effective interest rate that Rahul would pay for the loan?
a. 10.603% b. 10.426% c. 10.609% d. 10.285%
Answer:
b. 10.426%
Explanation:
Using the attached formula, convert the nominal rate to effective annual rate
m in the formula is the number of compounding periods per year; 12/2 = 6 in this case.
APR is the nominal rate which is 10%.
Next, plug in the numbers to the formula as shown below;
EAR = [tex][1+\frac{0.10}{6}]^{6} -1[/tex]
EAR = 1.10426-1
EAR = 0.10426 or 10.426% as a percentage
Hence choice B is correct.
The effective interest rate for the loan is 10.603% . To calculate the effective interest rate for a loan with a nominal rate of 10% compounded bimonthly, we can use the formula.
Explanation:To calculate the effective interest rate for a loan with a nominal rate of 10% compounded bimonthly, we can use the formula:
Effective Interest Rate = (1 + (Nominal Interest Rate / Number of Compounding Periods))^Number of Compounding Periods - 1
In this case, the nominal interest rate is 10% and the compounding is done bimonthly, which means there are 6 compounding periods in a year. Plugging these values into the formula, the effective interest rate is:
Effective Interest Rate = (1 + (0.10 / 6))^6 - 1 = 0.10603 or 10.603%
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Functional structures are usually found in organizations where there___________.
a. is no vertical integration.
b. is a single or closely related product.
c. exists a strong need to decentralize decision making.
d. are unrelated service offerings.
Answer:
The answer is b. is a single or closely related product.
Explanation:
A functional structure divides the organization into departments based on their function. Each is headed by a functional manager and employees are grouped as per their role. Most small industries with only a few products use this structure. The employees are highly skilled due to repetitive work which means high efficiency and the best performance.
Answer:
The correct answer is letter "B": is a single or closely related product.
Explanation:
Functional structures are those with top-down hierarchy where employees are provided with duties according to their skills and knowledge. These companies are characterized by massive manufacturing, thus, they need each department to specialize in a given task.
Rousey, Inc., had a cash flow to creditors of $16,965 and a cash flow to stockholders of $7,559 over the past year. The company also had net fixed assets of $49,705 at the beginning of the year and $57,130 at the end of the year. Additionally, the company had a depreciation expense of $12,252 and an operating cash flow of $51,136.
What was the change in net working capital during the year?
Answer:
$6,935
Explanation:
Cash flow from assets:
= Cash flow to creditors + Cash flow to shareholders
= $16,965 + $7,559
= $24,524
Cash flow from financial assets = Operating cash flow - Net capital spending - Change in working capital
$24,524 = $51,136 - ($57,130 - $49,705 + $12,252) - Change in working capital
$24,524 = $51,136 - $19,677 - Change in working capital
$24,524 = $31,459 - Change in working capital
Change in working capital = $31,459 - $24,524
= $6,935
Note:
Net capital spending = Net fixed assets at the end - Net fixed assets at the beginning + Depreciation expense
Final answer:
To calculate the change in net working capital for Rousey, Inc., the given financial details were leveraged, revealing a change of $6,935 over the year.
Explanation:
To determine the change in net working capital for Rousey, Inc., during the year, we use the provided financial metrics. First, it's important to understand that net working capital is the difference between a company's current assets and current liabilities. The formula for calculating the change in net working capital is not directly given, but we can infer it through another approach by utilizing the information given on cash flow.
The formula for net investment in fixed assets is:
Net Investment in Fixed Assets = Ending Net Fixed Assets - Beginning Net Fixed Assets + DepreciationApplying the numbers:
Net Investment in Fixed Assets = $57,130 - $49,705 + $12,252 = $19,677Then, using the formula for cash flow from assets, which is:
Cash Flow from Assets = Operating Cash Flow - Net Investment in Fixed Assets - Change in Net Working CapitalWhen rearranged to solve for the change in net working capital, it becomes:
Change in Net Working Capital = Operating Cash Flow - Net Investment in Fixed Assets - Cash Flow to Creditors - Cash Flow to StockholdersPlugging in the values:
Change in Net Working Capital = $51,136 - $19,677 - $16,965 - $7,559 = $6,935Therefore, the change in net working capital for Rousey, Inc., during the past year was $6,935.
Pension plan assets were $200 million at the beginning of the year. The return on plan assets was 5%. At the end of the year, retiree benefits paid by the trustee were $8 million and cash invested in the pension fund was $12 million. What was the amount of the pension plan assets at year-end?
Answer:
Pension plan assets at the year end will be $214
Explanation:
Wee have given pension plan assets = $200 million
Return on plan assets = 5%
So return will be equal to = $200×0.05 = $10 million
Cash contribution is given $12 million
Retiree benefits is $8 million
We have to find the amount of pension plan assets at the year end
Pension plan assets is equal to = Plan assets at beginning of the year + actual return - retiree benefits = $200 + $10 +$12 - $8 = $214
So pension plan assets at the year end will be $214
The best new product ideas are based on _____, which serve as the heart of the concept generation process. channel desires manufacturing efficiencies profit goals customer problems
Answer:
customer problems
Explanation:
Customer problems -
The problems of the consumers are the main aspect by which the idea about any new product can be laid down .
As the likes and dislikes for the particular product , makes the product a hit or miss .
As if the consumers like the goods and service s, the production of the product would increase an msd the profit earned by the company will also increase , and vice versa .
Hence , from the given statement of the question,
The correct option is customer problems.
Bank Management Printers Inc. produces luxury checkbooks with three checks and stubs per page. Each checkbook is designed for an individual customer and is ordered through the customer's bank. The company's operating budget for September 2014 includes this data:
Number of Checkbooks: 15,000
Selling Price per book: $20
Variable cost per book: $8
Fixed costs for the month: $145,000
The actual results for September 2015 were as follows:
Number of Checkbooks: 12,000
Selling Price per book: $21
Variable cost per book: $7
Fixed costs for the month: $150,000
1. Prepare a static-budget based variance analysis of the September performance
2. Prepare a flexible budget based variance analysis of the September performance
3. Why might Bank Management find the flexible budget based variance analysis more informative than the static budget based variance analysis?
The static budget variance analysis for September reveals unfavorable sales, variable, and fixed cost variances because it compares the actual results with the original budget. The flexible budget variance analysis, which adjusts the budget according to the actual volume of output, reveals more favorable variances in sales and variable costs but still an unfavorable fixed cost variance. Flexibility in budget variance analysis is crucial as it isolates management's control from volume fluctuations.
Explanation:1. Static-budget variance analysis compares the actual results with the original budget (September 2014), irrespective of the volume of output:
Sales Variance: (Actual unit sold * Actual price) - (Budgeted unit sold * Budgeted price) = (12,000* $21) - (15,000 * $20) = -$9,000 Variable Cost Variance: (Actual unit sold * Actual variable cost) - (Budgeted unit sold * Budgeted cost) = (12,000* $7) - (15,000 * $8) = +$6,000 Fixed Cost Variance: Actual fixed cost - Budgeted fixed cost = $150,000 - $145,000 = +$5,000
2. A flexible budget adjusts the budget according to the actual volume of output. It would calculate:
Sales Variance: (Actual unit sold * Actual price) - (Actual unit sold * Budgeted price) = (12,000* $21) - (12,000 * $20) = +$12,000 Variable Cost Variance: (Actual unit sold * Actual variable cost) - (Actual unit sold * Budgeted cost) = (12,000* $7) - (12,000 * $8) = +$12,000 Fixed Cost Variance: Actual fixed cost - Budgeted fixed cost = $150,000 - $145,000 = +$5,000
3. The flexible budget variance analysis might be more informative because it adjusts for changes in volume. This flexibility can provide a more accurate assessment of management performance, isolating the effect of volume fluctuations from management's control over costs and revenues.
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You just paid $360,000 for a policy that will pay you and your heirs $13,200 a year forever. What rate of return are you earning on this policy?
Answer:
Rate of return = 3.667%
Explanation:
This is a for of annuity known as perpetuity. Am annuity is an investment that gives yearly returns on the capital
To get the rate of return we use the following formula
Present value= Yearly payments/Rate of return
360,000= 13,200/rate of return
Cross-multiply
Rate of return (360,000)= 13,200
Rate of return= 13,200/360,000
Rate of return= 0.03666666= 3.667%
Answer:
= 3.67%. This means you are to earn at 3.67% on the policy taken
Explanation:
The question is to determine the rate of return of earnings based on the detailed policy.
Rate of Return
This represents a percentage of any investment that can either be a gain or a loss as calculated based on a particular time period. The Rate of Return can simply be called the RoR.
The Rate of Return in the question is calculated as follows:
First, what is the payment for the policy = $360,000
What is the annuity to be paid a year forever = $13,200
Therefore rate of return is simply
= Annuity/ Initial Policy Payment
= $13,200/ $360,000 x 100
= 3.67%. This means you are to earn at 3.67% on the policy taken
The Green Machine Manufacturing Company has the option to make or buy a component part for one of its lawnmowers. The annual requirement is 30,000 units. A supplier is able to supply the parts for $12.00 per piece. Green Machine estimates that it will cost $1,000 to prepare the contract with the supplier. To make the parts in-house, Green Machine must invest $100,000 in capital equipment. They estimate it will cost $8.50 per piece to produce the part in-house.
1. Carry all calculations out to two decimal places.
A. What is the breakeven quantity?
B. What is the total cost at the breakeven point?
C. What is the cost savings from making the correct decision?
Stanford issues bonds dated January 1, 2015, with a par value of $500,000. The bonds' annual contract rate is 9%, and the interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12%, and the bonds are sold for $463,140.
1. What is the amount of the discount on these bonds at issuance?
2. How much total bond interest expense will be recognized over the life of these bonds?
3. Prepare the amortization of the bond discount for the first payment period, using the effective interest method to amortize the discount.
Answer:
Explanation:
Discount on bond = Par value of bond - Issued price of bond = 500,000-463,140=36,860
2)
500,000*0.09 = 45,000
22,500 semiannually
Amount repaid:
Six payments (22500*6) 135,000
Add: Maturity value 500,000
Total amount repaid 635,000
Less: Amount borrowed (463,140)
Total bond interest 171,860
Total bond interest expense recognized 171,860
The discount on the bonds at issuance is $36,860. The total bond interest expense over the life of the bonds is $171,860. The discount amortization for the first period using the effective interest method is $5,288.
Explanation:The subject of this question is on discount amortization on bonds and we'll break it down in three steps:
1. The amount of the discount on these bonds at issuance can be calculated as the difference between the par value of the bond and the sale price, which is $500,000 - $463,140 = $36,860.
2. The total bond interest expense recognized over the life of these bonds can be computed by summing up the semiannual contract rates over three years and the discount amount. The semiannual contract rate is $500,000 * 9% / 2 = $22,500. So, the total bond interest expense is $22,500 * 2 * 3 (three years) + $36,860 (discount) = $171,860.
3. To prepare the amortization of the bond discount for the first payment period with the effective interest method, we need to multiply the beginning book value of the bond ($463,140) by the semiannual market rate (12% / 2 = 6%). The result is $27,788. Subtracting the semiannual interest payment of $22,500 from $27,788 gives us the amortization of the bond discount for the first period: $5,288.
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Insurance agents frequently emphasize "service" in their advertisements. What services should clients legitimately expect from their insurance agents?
Answer and explanation:
Insurance agents are typically brokers who offer individuals different types of coverage according to their needs. The agents are in charge of quoting insureds with policies, adding or removing members from the coverage, and most importantly, providing insureds verbally and written the information on the type of coverage that they are purchasing. Through servicing, sometimes they serve as intermediaries to expedite insureds claims.
Insurance agents provide services such as giving advice about coverage, helping clients understand policies, assisting in claims procedures, providing updated information, and offering ongoing support. They should guide clients based on their individual needs and keep them informed throughout any claim processes. They also periodically review and adapt policies as needed.
Explanation:Clients can expect various services from their insurance agents, who act as liaisons between them and the insurance companies. Primary services include providing professional advice regarding suitable coverage, helping clients to understand complex insurance policies, and assisting in the event of a claim. Providing accurate and relevant information, answering any queries, updating insurance policies based on changing needs, and providing ongoing support are also expected services.
For instance, if a client is not sure what type of insurance best fits their needs, the agent should be able to provide advice based on the client's lifestyle, assets, and risk factors. Similarly, if a client needs to make a claim, the agent should guide them through the process, ensuring all paperwork is correctly submitted and keeping them informed about the progress of the claim. It's also the agent's responsibility to periodically review policies with clients and advise on any updates or adaptations that might be needed, as situations can change over time.
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Following are two income statements for Alexis Co. for the year ended December 31. The left number column is prepared before adjusting entries are recorded, and the right column is prepared after adjusting entries. The company records cash receipts and payments related to unearned and prepaid items in balance sheet accounts.
Unadjusted Adjusted
Revenues
Fees earned $ 24,000 $ 30,600
Commissions earned 42,500 42,500
Total revenues 66,500 73,100
Expenses
Depreciation expense—Computers 0 1,650
Depreciation expense—Office furniture 0 1,925
Salaries expense 12,500 15,195
Insurance expense 0 1,430
Rent expense 4,500 4,500
Office supplies expense 0 528
Advertising expense 3,000 3,000
Utilities expense 1,250 1,327
Total expenses 21,250 29,555
Net income $ 45,250 $ 43,545
Analyze the statements and prepare the eight adjusting entries that likely were recorded.
Answer:
Find in the excel file attached detailed adjusting entries required for all transactions in the question.
Explanation:
Please note the analysis of each transaction done under the heading "particulars".
On February 18, 2021, Union Corporation purchased 600 IBM bonds as a long-term investment at their face value for a total of $600,000. Union will hold the bonds indefinitely, and may sell them if their price increases sufficiently. On December 31, 2021, and December 31, 2022, the market value of the bonds was $580,000 and $610,000, respectively. Required: 2. & 3. Prepare the adjusting entry for December 31, 2021 and 2022.
Answer:
Adjusting Entry for decrease in Fair Value of $20,000 from $600,000 to $580,000 on December 31, 2021
Dr Unrealized Loss on Investment (Other Comprehensive Income) $20,000
Cr Investment (Fair Value Adjustment) $20,000
Adjusting Entry for increase in Fair Value of $30,000 from $580,000 to $610,000 on December 31, 2022
Dr Investment (Fair Value Adjustment) $30,000
Cr Unrealized Gain on Investment (Other Comprehensive Income) $30,000
Explanation:
This investment will be classified as "Available for Sale" as the anticipated sale date is not within the next 12 months. Available for sale long-term investments are recorded at cost when purchased and subsequently adjusted to reflect their fair values at the end of each reporting period. Unrealized holding gains or losses are kept as "other comprehensive income" until the long-term investment has been sold.
It will not be classified as "Held to Maturity Investment" as Union Corporation does not intends to keep this investment until maturity and may sell them if its price increases sufficiently.
Which of the following help departments organize unique access controls for access to folders and data files within a department or group so that only those employees who need access to confidential data are granted access?
Answer:
D) Role Based Access Controls
Explanation:
First, the multiple options to the question are as follows:
A) Title-based access controls
B) Role-based access controls
C) Administrative access controls
D) Privacy-based access controls
The Role Based Access Controls (RBAC) represents a network access restricting method that only allows the right employee in an organisation to access information that are relevant to their roles, jobs and responsibilities.
The goal is also to ensure that they don't have access to sensitive information that they do not need to be concerned with. In a situation where employees want access to restricted data, formal application will be made and top management will review whether the information requested can be released or not.
Hierarchical authority is a system that can organize unique access controls for departments or groups to ensure that only those who need access to confidential data have it. This system is used in various organizations, such as the Department of Justice.
Explanation:In the context of organizing unique access controls to folders and data files, the option that makes the most sense is Hierarchical authority (option a). Hierarchical authority within a system designates who has access to specific information, such as confidential data. In a department or group, it ensures that access to specific resources is restricted to only those who need it.
This kind of access control is often seen in departmental structures within organizations. For instance, in the Department of Justice, different levels of authority, such as the attorney general, associate attorney general, bureau and division heads, each have different levels of access to information. This hierarchical structure extends to numerous levels within the organization, enabling an efficient deployment of resources and information.
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A market that is dominated by a few firms is called a(n) Select one: a. gerontology. b. theocracy. c. biopsy. d. oligopoly.
Answer:
D. Oligopoly
Explanation:
When a market is shared between a few firms, it is said to be highly concentrated. Although only a few firms dominate, it is possible that many small firms may operate in the market.
Answer:
The correct answer is letter "D": oligopoly.
Explanation:
An oligopoly is when a market is controlled by a small group of two or more firms. Businesses in an oligopoly can agree to price collusion and create barriers to entry for new commerce. If the businesses do not, they would likely be forced to lower their prices and open the market for newer smaller firms.
The present value of a stream of cash flows is just the sum of the present values of each individual cash flow. True False
Answer:
True
Explanation:
In order to find the Present value of multiple cash flows, each cash flow must be discounted to a same point in time and then added together.
Present Value
= (Cash flow 1)/(1 + r)^t1 + (Cash flow 2)/(1 + i)^t2 + (cash flow 3)/(1+i)^t3...... + (Cash flow N)/(1+i)^n
Therefore, The statement is True.
The present value of a stream of cash flows is the sum of the present values of each individual cash flow. This is a common principle in financial mathematics often referred to as the principle of value additivity. Each cash flow is discounted to its present value individually, and then these values are added together.
Explanation:The statement that the present value of a stream of cash flows is just the sum of the present values of each individual cash flow is indeed true. In financial mathematics, this principle is often referred to as the principle of value additivity. Essentially, when calculating the present value of multiple cash flows, each cash flow is discounted to its present value, and then these values are added together. This results in the total present value of the stream of cash flows. For instance, if we have a stream of cash flows of $1000 in one year, and another $1000 in two years, and we're discounting at a rate of 5%, we would calculate the present value of each cash flow individually and then sum them up. The present value of the cash flow in one year would be $1000/(1+0.05) = $952.38, and the present value of the cash flow in two years would be $1000/(1+0.05)^2 = $907.03. Summing these up gives a total present value of $952.38 + $907.03 = $1859.41.
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What two factors inhibit the ability of rivals to imitate a firm's most valuable resources and capabilities?
Answer:
I think the most applicable answers are,
*The possession of expertise, knowledge and skills that the competitors do not possess
*Having the access to unique resources and legal protections (such as patent rights)
Explanation:
When you have the intellectual and skill.capacity to harness the maximum out of a Resource and that it is a unique one, then the competition have one way to imitate you.
Moreover, once you have the legal protection and/or the exclusive access to a certain resource or to a technology, then the competitors can't imitate you as well.
Macroeconomics is the study of A. why the U.S. has spent so much money on wars and government surveillance of its own citizens. B. how households and firms make choices, how they interact in markets, and how the government attempts to influence their choices. C. the economy on a state-by-state basis, covering areas affected by the Commerce Clause. D. the economy as a whole, including topics such as inflation, unemployment, and economic growth.
Answer:
D. the economy as a whole, including topics such as inflation, unemployment, and economic growth.
Explanation:
Macro Economics is the study of economy as a whole. It focuses on economic participants - buyers, sellers as a huge aggregate group. It deals with Aggregate factors of Economy like - Aggregate Demand, Aggregate Supply, General Price Level, over all economic growth.
Paul just graduated from college and landed his first "real" job, which pays 37,900 a year. In 13 years, what will he need to earn to maintain the same purchasing power of inflation averages 3 percent?
Answer:
Salary= $55,656.15
Explanation:
Giving the following information:
Paul just graduated from college and landed his first "real" job, which pays 37,900 a year.
n= 13 years
inflation= 3% annually
First, we need to calculate the total inflation of the 13 years:
accumulated inflation= 1.03^13= 1.4685
Now, we can calculate the amount necessary to maintain the purchasing power:
Salary= 37,900*1.4685= $55,656.15
.Balance of Work in Process and Finished Goods, Cost of Goods Sold Derry Company uses job-order costing. At the end of the month, the following information was gathered: Job # Total Cost Complete? Sold? 301 $1,600 Yes No 302 1,240 Yes Yes 303 780 No No 304 2,300 Yes No 305 4,150 Yes No 306 350 No No 307 710 Yes Yes 308 620 No No 309 1,200 No No 310 515 No No The beginning balance of Finished Goods was $300, consisting of Job 300, which was not sold by the end of the month.Required:1. Calculate the balance in Work in Process at the end of the month.$2. Calculate the balance in Finished Goods at the end of the month.$3. Calculate Cost of Goods Sold for the month.$
Answer:
1. $3,465
2. $1,950
3. $8,050
Explanation:
The computation is shown below:
1. The balance in Work in Process at the end of the month is shown below:
= Job 303 + Job 306 + Job 308 + Job 309 + Job 310
= $780 + $350 + $620 + $1,200 + $515
= $3,465
2. The balance in Finished Goods at the end of the month is shown below:
= Job 302 + Job 307
= $1,240 + $710
= $1,950
3. The Cost of Goods Sold for the month is given below:
= Job 301 + Job 304 + Job 305
= $1,600 + $2,300 + $4,150
= $8,050
Final answer:
The balance in Work in Process at the end of the month is $3,465. The balance in Finished Goods at the end of the month is $8,050. The Cost of Goods Sold for the month is $4,050.
Explanation:
To calculate the balance in Work in Process at the end of the month, we need to sum up the costs of all the jobs that are not complete. The cost of each job is given in the table, so we can add up the costs for Job 303, Job 306, Job 308, Job 309, and Job 310. The total cost in Work in Process is the sum of these costs: $780 + $350 + $620 + $1,200 + $515 = $3,465.
To calculate the balance in Finished Goods at the end of the month, we need to sum up the costs of all the jobs that are complete and not sold. The cost of each job is given in the table, so we can add up the costs for Job 301, Job 304, and Job 305. The total cost in Finished Goods is the sum of these costs: $1,600 + $2,300 + $4,150 = $8,050.
To calculate the Cost of Goods Sold for the month, we need to sum up the costs of all the jobs that are complete and sold. The cost of each job is given in the table, so we can add up the costs for Job 302, Job 307, and Job 313. The total Cost of Goods Sold is the sum of these costs: $1,240 + $710 + $2,100 = $4,050.
An accounting entry that is characterized by having multiple debits and/or multiple credits is called a ________ entry. A. compound journal B. chart of accounts C. posted D. balanced
Answer:
A. compound journal entry
Explanation:
Compound journal entry -
It refers to the type of accounting entry , which consists of more than one debit or credit , is referred to as compound journal entry .
It is the combination of various simple journal entries together to form a compound journal entry .
Hence , from the given information of the question,
The correct option is A. compound journal entry .
Classify the given goods according to whether or not they would be included in calculating the GDP for the United States. All goods should be placed. If a country is not specified, you can assume the action is performed in the United States.
Answer:
ITEMS TO BE INCLUDED IN THE GDP
1. Honda;s assembly and sales of cars in the U.S.
2. Old Navy Purchases mannequins to display clothes
ITEMS NOT TO BE INCLUDED IN THE GDP OF THE UNITED STATES
1. GM's Assembly and sales of cars in Mexico
2.Resale of used textbooks to college students
3. Ocean spray purchases plastic to make bottles
4. Sales of wheat to Mrs. Baird's Bakery
Explanation:
Completion of the Question is as follows:
The following should be placed into two groups: Group A represents items to be included in the GDP of the U.S and Group B represents items not be included in the GDP of the U.S.
The Items are as follows:
GM's Assembly and sales of cars in Mexico
Old Navy Purchases mannequins to display clothes
Resale of used textbooks to college students
Ocean spray purchases plastic to make bottles
Honda;s assembly and sales of cars in the U.S.
Sales of wheat to Mrs. Baird's Bakery
Solution
Gross Domestic Product (GDP)
The GDP of a nation is the measure of the market value all finished products, goods and services manufactured or rendered within the borders of a particular country and within a period of time usually one year.
This means that any good produced in another country for instance Germany will not be included in the GDP of the United States. Also, GDP considers only finished goods, hence, intermediate or raw materials for finished goods will also not be included in the GDP calculation.
Based on the explanation, the classification is as follows
ITEMS TO BE INCLUDED IN THE GDP
1. Honda's assembly and sales of cars in the U.S. - The cars were assembled in the United States which is a part of production, hence, they qualify for GDP calculation
2. Old Navy Purchases mannequins to display clothes- The Mannequins were bought as a company's finished products and will not be used to produce any new product. They are already in their finished form
ITEMS NOT TO BE INCLUDED IN THE GDP OF THE UNITED STATES
1. GM's Assembly and sales of cars in Mexico- General Motors assembled the cars in Mexico and this does not qualify as manufactured in the United States.
2.Resale of used textbooks to college students- The textbooks were already calculated for GDP in their year of production, hence, a resale value will not qualify for GDP calculation
3. Ocean spray purchases plastic to make bottles - The plastic purchased represent intermediate goods for further processing of bottles, they are raw materials and not finished goods.
4. Sales of wheat to Mrs. Baird's Bakery - The wheat purchased represent intermediate material for further processing of bread, it is a raw material required to produce a finished product - bread.