Answer:
To find the opportunity cost of capital for a safe investment, managers and investors look at current interest rates on safe debt securities.
Explanation:
Opportunity cost of capital refers to the return that could have been earned by investing in another investment opportunity with comparable risk.
Answer:
Opportunity cost of the capital is usually (if we consider the tax implications on the returns demanded by the lenders) the return required by the investors
Explanation:
So assume that I am appraising a project and I need an investment of round about 1 million dollars. If I fund this investment from loan which costs me 10% and also increases the financial cost then its opportunity cost is 10% interest and additional risk increased. However I also have an offer from one of my friends who is willing to invest in this project and is offering me $0.5 million equity investment and demands 20% return on this investment alongwith lower financial risk. So the opportunity cost of this equity investment is 20% cost of equity along with lower financial risk.
We can find opportunity cost of capital for a safe investment from the yield of government gilts or treasury bond's yield on investment.
On the statement of cash flows prepared by the indirect method, the Cash flows from operating activities section would includea. payments for cash dividendsb. gains or losses on fixed assetsc. receipts from the issuance of capital stockd. receipts from the sale of investments
Answer:
b. gains or losses on fixed assets
Explanation:
Operating activities: It includes those transactions that affect the after-net income working capital. It would deduct the increase in current assets and a decrease in current liabilities, while adding the decrease in current assets and an increase in current liabilities.
It would manage those adjustments in working capital. In addition, the depreciation costs are added to the net income and the loss on the sale of assets is added, while the profit on the sale of assets is deducted
When referring to "marginal" changes, the economic focus is on
large changes on the low end.
changes that affect only a few people or products.
small or incremental changes.
graduated changes on the high end.
Option C
When referring to "marginal" changes, the economic focus is on small or incremental changes.
Explanation:
“Marginal” in economics indicates “added” or “extra”. It is the belief that Organizations may exercise determinations by examining the influence of minute variations from the current state. A marginal change is proportionally quite a little increase or reduction to the entire amount of any variable. Statisticians practice the name marginal change to represent tiny incremental improvements to an actual form of progress.
Statisticians rely massively on the view that firms, purchasers and other business quarters can progress judgments by considering in names of the margin. Basic marginal ideas in economics involve marginal cost, marginal benefit.
g which of the following is one of the goals of the American Marketing Association? A. To promote the use of a utilitarian approach to marketing whenever possible B. To promote ethical relativism C. To create a single open market where goods flow freely between countries D. To promote high standards of ethical norms and values E. To establish free trade zones worldwide
Answer: The correct answer is "D. To promote high standards of ethical norms and values".
Explanation: The American Marketing Association has a complete code of ethics, from which it undertakes to promote the highest level of standards and the application of professional quality ethical values for its different members.
Imagination Museum is holding nominations for its board of directors. It is the first time that over half of the positions are vacant, due to either retirements or term expirations. The new CEO wants to be sure that the board is representative of the community, as well as the patrons who attend most of the events. ,Which of the following considerations are important for a good board?a. racial balance b. financial balance c. religious/cultural balance d. educational attainment balance e. gender balance
Answer:
Gender Balance
Explanation:
Since, it helps in maintaining the culture with exchange of the ideas and views at the same time respecting other set of thoughts for the board development. It is also a sign of neutrality that gives positive impact. Lastly, representation for the community need to be fulfilled with all sets of the individuals in terms of gender for a healthy and amicable atmosphere
If supply is inelastic, then a demand shift will have a ____ effect on _______ than on quantity.
Answer:
Supply Inelastic: Demand shift will have more effect on price than on quantity
Explanation:
Demand and supply reflect buyers & sellers - buying & selling tendencies.
Demand curve & supply curve are downward sloping & upward sloping respectively (∵law of demand , law of supply) & EQUILIBRIUM is where Demand = Supply & Demand, Supply curves intersect.
Elasticity is demand / supply responsiveness to price change. Inelastic Supply doesn't respond to price. It has a vertical curve parallel to y axis (unlike usual upward sloping curve).
Demand change shifts downward sloping demand curve - 1. Rightwards if Increase in Demand, 2. Leftwards if Decrease in Demand. 1st case (↑Dd) with inelastic supply leads to increase in price & no change in quantity, at new equilibrium. 2nd case (↓Dd) with inelastic supply leads to decrease in price & no change in quantity, at new equilibrium.
So, Change in Demand with Inelastic Supply changes only Equilibrium Price & not Equilibrium Quantity.
From the perspective of a general manager in your field, which of the organizational control methods outlined in Chapter 19 of the Management textbook do you think would be the most universal? What does organizational control look like in your sphere of influence?
Answer and Explanation:
Association controls is a sort of deliberate procedure which encourages administrator to manage the hierarchical exercises to make each thing adjusted and desires set up in plans, standard execution and target.
The three significant association control are feed forward, simultaneous and criticism control components.
From a head supervisor point of view the most well-known or all around acknowledged authoritative control is the ' simultaneous control'. This aides in settling issue by versatile condition, absolute quality administration a representative discretion. Simultaneous control intently screen the exercises and propose new arrangements dependent on the adjustment in necessity. This aides in making key execution pointers for all the useful office.
Your friend Sam has been asked to prepare appetizers for a university reception during homecoming weekend. She has an unlimited amount of ingredients but only six hours to prepare them. Sam can make 300 mini-sandwiches or 150 servings of melon slices topped with smoked salmon and a dab of sauce per hour. Draw Sam's production posiibilities frontier.
Answer:
Downward sloping curve with 300 intercept on mini sandwich axis, 150 intercept on melon spices
Explanation:
PPC reflects production combinations (2 goods), which can be produced given same resources & technology. It is downward sloping because of inverse relationship between two goods, one good increase leads to other good decrease - given same resources & technology.
In this case, it is with analogous factors : production possibilities with respect to unlimited ingredients (resources), limited time. Although resources are given to be unlimited, PPC is likely to be downward sloping : because of inverse relationship between goods - based on time constraint (one good increase will withdraw time from other good & reduce it).
The PPC intercept on X & Y axis represents the maximum amount of that axis good, which can be produced. So: it has 300 intercept on mini sandwich axis, 150 intercept on melon spice axis.
The slope & shape of PPC depends on Marginal Opportunity Cost, which depends on relative efficiency of resources in two goods.
Resources equally efficient - Constant Good Sacrifise Ratio i.e MOC - PPC straight line. Resources unequally efficient - Increasing Sacrifise Ratio (from efficient to inefficient good) i.e MOC rising - PPC Concave. Increasing Sacrifise Ratio (from inefficient resources to efficient resources) i.e MOC falling - PPC Convex.
If MOC between mini sandwiches & melon spices is constant, PPC is straight line . If MOC between them is rising, PPC is concave. If MOC between them is falling, PPC is convex.
Sam's Production Possibilities Frontier can be graphed by plotting the amount of mini-sandwiches (300 per hour) and servings of melon slices (150 per hour) she can make in the 6-hour period. The graph will illustrate the various combinations of these two appetizers Sam can make with her limited time.
Explanation:The task involves deriving Sam's Production Possibilities Frontier (PPF), a graphical representation showing the maximum number of different combinations of goods/services that can be produced in a fixed amount of time with a given number of resources, assuming all resources are fully utilized.
In this case, Sam can either prepare mini-sandwiches or melon slices topped with smoked salmon. She has a finite amount of time -6 hours, but the ingredients are unlimited. Sam can make 300 mini-sandwiches or 150 servings of melon slices per hour.
Plotting these on a graph, where the x-axis represents the amount of mini-sandwiches and the y-axis represents the servings of melon slices, will yield Sam's PPF. The points moving from the origin to the upper-right indication a combination of sandwiches and melon servings Sam can produce in 6 hours.
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The United States, Canada, and Switzerland can all be described as ________ systems of government while France can be described as a ________ system of government.
a. unitary; federal
b. totalitarian; federal
c. federal; unitary
d. oligarchic; federal
e. unitary; totalitarian
Answer:
The correct answer is letter "C": federal; unitary.
Explanation:
A federal government is the type of national management where the power is divided between a central body and state governments that work connected. On the other hand, a unitary government does not share power among its territories. Governmental decisions are centralized.
Vault-Tec. has annual fixed costs excluding depreciation of $1,000,000 and variable costs that are 75% of sales. If depreciation was $250,000, what was Vault-Tec's break-even level of sales?
Final answer:
To find Vault-Tec's break-even level of sales, we calculate it as Fixed Costs / (1 - Variable Cost Ratio), with fixed costs of $1,000,000 and a variable cost ratio of 0.75. This results in $4,000,000 in sales needed to break even.
Explanation:
Break-Even Analysis in Business
To calculate Vault-Tec's break-even level of sales, we need to understand that break-even occurs when the total revenue equals the total costs. Here, the total costs include both fixed costs and variable costs. To find the break-even point in terms of sales dollars, we use the formula: Fixed Costs / (1 - Variable Cost Ratio).
Vault-Tec.’s fixed costs are $1,000,000 and the depreciation is $250,000, but since depreciation is a non-cash expense and does not affect the calculation in this context, we will exclude it. The variable costs are 75% of the sales, meaning the Variable Cost Ratio is 0.75. Putting these numbers into the formula gives us:
Break-even level of sales = $1,000,000 / (1 - 0.75) = $1,000,000 / 0.25 = $4,000,000.
Therefore, Vault-Tec would need to achieve $4,000,000 in sales to break even.
This same approach can be applied to any business scenario, like the vacuum cleaner manufacturer mentioned in the provided examples who has to calculate the number of units to sell at a given price to cover her costs. By understanding your costs and setting prices accordingly, a business can plan for the break-even price point and guarantee that its sales cover all expenses.
Why are employee benefits strategically important to employers and what are some key strategic considerations?
Explanation:
Employee benefits are strategically important for employers because this is a strategy for recruiting and retaining good people to work for your company, as qualified employees will be more productive and will more effectively assist in achieving goals and organizational objectives.
However, offering benefits requires a high cost, because the more benefits the company offers, the more expensive the cost of hiring employees, so it is necessary to have a clear communication strategy with employees about the value and cost of benefits received, so that there is a greater understanding of total compensation.
Employee benefits are strategically important to employers for attracting and retaining skilled employees, incentivizing performance, and meeting legal requirements. These benefits may include health insurance, supplemental pay, retirement and savings plans, and continuous training and education.
Explanation:Employee benefits are strategically important to employers for many reasons. Primarily, they assist in attracting and retaining a highly-skilled, productive workforce. Specifically, companies that offer the best benefits package and brand successfully attract younger generations, such as millennials, who value a variety of options, including flexible work schedules and continuous training and education. Health Benefits, Supplemental Pay, and Retirement and Savings are key strategic features of employee benefit packages. Employers with more than 50 employees must legally provide health insurance, reinforcing the strategic importance of health benefits. Additionally, employers often offer defined benefits or defined contribution schemes, such as pensions. In such cases, employers are required to contribute a small fraction to the Pension Benefit Guarantee Corporation to protect employee benefits in case of bankruptcy.
Moreover, employers use benefits strategically to incentivize and reward performance, thus boosting employee morale and productivity. Furthermore, such benefits can serve as potent signals employers use to pre-screen candidates, as well as indicators of attributes such as work ethic and perseverance. Therefore, well-crafted employee benefit packages are instrumental for employers in managing their workforce and achieving organizational objectives.
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John is purchasing a house for $500,000. He plans to make a down payment of $100,000 and take out a 30-year mortgage for $400,000.a.If the interest rate on the house is 5.5 per cent per year, how much will his monthlypayment be for principal and interest?b.If the interest rate is the same, how much would his monthlypayment for principal and interest be if he took out a 15-year mortgage?
Answer:
1) The monthly payments if the mortgage is 30 years will be $2,270
2)The monthly payments if the mortgage is 15 years will be $3,267
Explanation:
The house is worth 500,000, John pays 100,000 down payment which means that 400,000 payment is left. We need to find out that if the present value of the payment is 400,000 then what will the monthly payments be for 30,000 in order to have a present value of 400,000.
The Present value is 400,000, the interest rate is 5.5% but because the payments are monthly we will divide it by 12 (5.5/12=0.458). The Number of compounding periods will be the number of months in 30 years so N = 30*12=360. The future value is 0 as there is no lump sum payment at the end.
We input the following information in a financial calculator in order to find the the payment.
PV= 400,000
FV=0
N=360
I=0.458
Compute PMT=2,270
Now in order to find the payments for a 15 year mortgage we will replace n=360 with n=15*12= 180.
PV= 400,000
FV=0
N=180
I=0.458
Compute PMT=3,267
Final answer:
To calculate the monthly payment for principal and interest, use the formula for a fixed-rate mortgage. For a 30-year mortgage at 5.5% interest, the monthly payment would be approximately $2,264.33. If John took out a 15-year mortgage, the monthly payment would be different with a shorter term.
Explanation:
To calculate the monthly payment for principal and interest, we can use the formula for a fixed-rate mortgage:
Monthly Payment = (P * r * (1+r)^n) / ((1+r)^n - 1)
where:
P represents the principal amount borrowed ($400,000)r is the monthly interest rate (5.5% / 12 = 0.00458)n is the number of monthly payments (30 years = 30 * 12 = 360 months)Using these values, we can calculate the monthly payment:
Monthly Payment = (400000 * 0.00458 * (1+0.00458)^360) / ((1+0.00458)^360 - 1) = $2,264.33 (approximately)
If John took out a 15-year mortgage instead, the formula would remain the same but with a different value for n.
Briefly explain, in your own words, three of the hedge transaction types. Describe in which situations each would be used and why.
Answer:
Explanation:
Transaction types:
1. Fair Value Hedge: the risk being hedged is the change in the fair value of assets and liabilities between the contract date and settlement date. This is used to hedge interest rates, foreign exchange rates etc.
2. Cash Flow Hedge: the risk being hedged is the exposure to variability to cash flows. This is used to hedge equity prices, commodity prices
3. Hedge of net investment in foreign operation: The risk being hedged is currency risk associated with translation of foreign operations.
Do the following activities contribute to US GDP in 2020? Explain why or why not? In which year do these activities contribute to US GDP and to which component of expenditure?
(a) A new Toyota Camry built in Japan and sold in the US in 2019
(b) A new Toyota Camry built in Tennessee in December 2013 and sold in Canada in January 2020
(c) A used Toyota Camry built in Japan in 2007 and sold in the US in December 2020
(d) A new Toyota Camry built in Tennessee in December 2013 and sold in North Carolina in June of 2020
(e) A used Toyota Camry bought by a used car dealership for $5000 and sold for $6000 in 2020
The GDP includes only new goods and services bought and produced within the country in a specific year. Imported cars, used cars, and cars made in an earlier year do not contribute to the GDP of the stated year. Only new cars produced and sold to other countries contribute to the GDP as exports.
Explanation:The Gross Domestic Product (GDP) of a country is the sum of all goods and services produced within a certain period. It is divided into four main components: consumption (C), investment (I), government spending (G), and net exports (X-M).
A new Toyota Camry built in Japan and sold in the US in 2019 would not contribute to US GDP in 2020 as it's counted in the year it was sold (2019) and falls under imports (M) since it was made outside the US. A new Toyota Camry built in Tennessee in December 2013 and sold in Canada in January 2020 would contribute to 2020 US GDP in the net exports (X-M) section because the US made it and sold to another country. A used Toyota Camry built in Japan in 2007 and sold in the US in December 2020 doesn't add to the US 2020 GDP because GDP considers the production of new goods and services only. The car was initially accounted for the year it was first sold. A new Toyota Camry built in Tennessee in December 2013 and sold in North Carolina in June of 2020 wouldn't count towards US GDP in 2020 because it was initially included in the GDP in 2013, the year it was first produced and sold. A used Toyota Camry bought by a used car dealership for $5000 and sold for $6000 in 2020 would not contribute to 2020 US GDP. Only the value-added services associated with the resale of the car could be included in the GDP.Learn more about US GDP Contribution here:
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Suppose the tax multiplier is 2.7. Assuming prices are constant, this means that
Group of answer choices
a $1 rise in government spending will raise both total spending and Real GDP (assuming prices are constant) by $2.70.
a $1 decline in taxes will lower Real GDP by $2.70.
a $1 decline in taxes will raise Real GDP by $2.70.
a $1 rise in taxes will change interest rates by 2.70 percent compared to what they were before the $1 rise in government spending.
none of these options.
Answer:
a $1 rise in government spending will raise both total spending and Real GDP (assuming prices are constant) by $2.70.
Explanation:
The tax multiplier is generally used to show the multiple at which there is either a decrease or an increase in gross domestic product when there is either an increase or decrease in tax. Therefore, if the tax multiplier is equivalent to '$n' and assuming there is no change in price, there will be an increase of '$n' on the GDP and total spending for every dollar increase in the spending of government.
Suppose XYZ stock pays no dividends and has a current price of $50. The forward price for delivery in 1 year is $55. Suppose the 1 year effective annual interest rate is 10%. (a) Graph the payoff and profit diagrams for a forward contract on XYZ stock with a forward price of $55. (b) Is there any advantage to investing in the stock or the forward contract? Why? (c) Suppose XYZ paid a dividend of $2 per year and everything else stayed the same. Now is there any advantage to investing in the stock or the forward contract? Why?
The PMO is used to maintain and provide a cadre of skilled and trained project professionals as needed under the:
A) Control tower model.
B) Cadre model.
C) Weather station model.
D) Resource pool model
Answer:
D) Resource pool model
Explanation:
The Resource Pool is a set available to define project tasks. The resource pool can be assigned to only one project or task, or can be shared by several projects. A resource may be part of a separate resource list for multiple projects, or a single resource can be part of a common resource pool. Automation of project management facilitates the creation and use of resource pools. The project management software allows you to create custom project documentation for resource information that facilitates data and task management. The Resource Pool allows you to schedule sources for multiple projects. Because the information is integrated and accessible to all users, you can quickly identify contradictions between the tasks of an employee in different projects and see how their time is devoted to each project.
Janson Corporation Co.'s trial balance included the following account balances at December 31, 2016: Accounts payable $26,700 Bond payable, due 2025 23,800 Salaries payable 17,800 Note payable, due 2017 21,700 Note payable, due 2021 41,700 What amount should be included in the current liability section of Janson's December 31, 2016, balance sheet?
Answer: $ 66,200
Explanation:
Payables which are due for payment within a one year period from the balance sheet date are considered as current liability. The amounts to be considered in the current liability section of the balance sheet are as follows:
Accounts Payable $ 26,700
Salaries Payable $ 17,800
Note payable Due 2017 $ 21,700
Total Payables in CL $ 66,200
The Bond payable due in 2025 of $ 23,800 and Note Payable due 2021 of $ 41,700 are not considered as they are payable beyond one year from date of balance sheet
__________ can seek investment from social venture capitalists known as impact-investment funds.
Answer:
The correct word for the blank space is: social venture capitalist.
Explanation:
Social venture capitalists are investments entrepreneurs get into to generate profit trough an organization while achieving a social impact at the same time. This is typically done as a way to create social awareness on protecting the environment around businesses since most of them harm the atmosphere without taking care of the consequences in the future.
_________ is the abundance or shortage of critical organizational resources in an organization's external environment. Group of answer choices
Answer:
The correct word for the blank space is: Resource scarcity.
Explanation:
Resource scarcity can be defined as the lack of enough materials needed to perform a company's line of production. This problem typically pushes firms to contact suppliers outside their main area of operations so their output cannot be affected. Because of resource scarcity, various economic decisions must be made so a company can allocate resources efficiently.
Talia lives in Houston, Texas. She has traveled to India several times and is interested in working for a multinational corporation (MNC) with a presence there. She hopes that by working for such a company, she’ll first have an opportunity to transfer to a position in India and live there for an extended time and then be able to parlay that international experience into opportunities in other countries. Her research shows that MNCs with a significant presence in India include Nestlé, headquartered in Switzerland; PepsiCo, headquartered in the United States; Sony, headquartered in Japan; and Sun Pharmaceutical Industries, headquartered in India itself. Talia wants to do a lot more research on how these companies operate in India and on the nature of MNCs in general.
If Talia is hired as a manager at an MNC, what can she can expect? Check all that apply.
A. Strategy will include finding raw materials and locating production wherever it is most profitable to do so.
B. The corporate structure will integrate the activities of foreign affiliates.
C.She and her colleagues will cultivate a global perspective and view the entire world as one market.
D.The headquarters function will be dispersed, and various parts of the company will operate semi-independently.
Answer: The correct answers are "C. She and her colleagues will cultivate a global perspective and view the entire world as one market. ", "B. The corporate structure will integrate the activities of foreign affiliates. " and "A. Strategy will include finding raw materials and locating production wherever it is most profitable to do so.".
Explanation: If Talia is hired as a manager of a multinational, surely she and her colleagues will have a global perspective and will perceive the entire world as a single market, since it is a fundamental characteristic for the development of a multinational, as well as being in several countries, An optimal strategy would be to find and locate production in the country that implies a lower cost of labor and raw materials.
Also the corporate structure must integrate the activities of foreign subsidiaries to have greater power in the global market.
As a manager in a multinational corporation, Talia can expect to be involved in strategies seeking cost-effective production locations, working with an integrated corporate structure which involves foreign affiliates, cultivating a global market perspective, and the potential for semi-independent operation of different regional segments of the company.
Explanation:If Talia is hired as a manager at a multinational corporation (MNC), she can expect a number of experiences.
A. MNCs often follow strategies to find raw materials and locate production where it is most profitable. This is done to minimize costs and maximize profits. B. MNCs usually have a corporate structure that integrates the activities of foreign affiliates. This means that operations across different countries are coordinated and aligned with the overall corporate strategy. C. Talia and her colleagues will likely need to cultivate a global perspective and view the entire world as one market. This is because MNCs operate in multiple countries and need to consider global trends and variations in their decision-making processes. D. In many MNCs, the headquarters function is dispersed, meaning that different parts of the company operate semi-independently in different regions. This allows MNCs to be flexible and adaptive to local market conditions.Learn more about Working for Multinational Corporations here:
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On January 1, 2016, American Corporation purchased 25% of the outstanding voting shares of Short Supplies common stock for $232,500 cash. On that date, Short's book value and fair value were both $930,000. The equity method is deemed appropriate for this investment. Short's net income reported on December 31, 2016, was $89,000. During 2016, Short also paid cash dividends in the amount of $28,500. Required: Compute the amount that would be reported for the investment on American Corporation's financial statements at December 31, 2016.
Answer:
$247,625
Explanation:
Expectation: To compute the amount to be reported in the investment on American Corporation's Financial Statements - December 31st, 2016
Step 1: American Corporation purchases of Short Supplies = $232,500
This represents 25% of the outstanding voting shares of Short Supplies.
Short Supplies net income was $89,000
Therefore, American Corporation's share of net income = 25% x $89,000
= $22,250. This is the reported income as a result of the voting shares bought.
Secondly, since cash dividend was paid (paid before the declaration of the net income), then American Corporation as an investor is also entitled to the 25% of the dividend
Therefore,
The final amount of total investment of American Corporation to be reported in the financial statement is
The value of the initial stock purchased + Share of net Income - Cash dividend due.
= $ 232,500 (original investment) + $22,250 (share of net income) - ($7,125) Cash dividend
= $247,625
A plat is a title to land, similar to an automobile title, that was designed to make land and title more easily transferable. A. TrueB. False
Answer:
The correct answer is letter "B": False.
Explanation:
A plat is a drawn map showing in detail the dimensions of a property in scale. It portraits in paper what the distribution of the property is. Typically a plat survey is carried out at the moment of making a plat. The plat must be validated by a public works agency or an urban planning commission so it can be considered for legal processes.
A plat is not a title itself.
Answer:FALSE
Explanation:A PLAT which can also be referred to as PLAN is drafted to measure the land,the subsections of the land,the boundaries of the land,the connecting streets etc. It can be used for both vegetations or for residential Buildings.
A plat map is required especially when the land is to be subdivided into lots for use in either public Buildings or for public Access or for recreation center such as Parks, gardens, relaxation spots etc.
Mary has a Roth IRA held more than 5 years to which she has contributed $30,000. The IRA has a current value of $62,000. Mary is 55 years old and she takes a distribution of $38,000. How much of the distribution will be taxable to Mary?
Answer:
distribution will taxable to Mary = $8,000
Explanation:
given data
contributed = $30,000
current value = $62,000
distribution = $38,000
age = 55 years old
solution
when requirement is satisfy so withdrawals from a Roth IRA is tax free
so here distribution will be taxable to Mary as
distribution will taxable to Mary = $38,000 - $30,000
distribution will taxable to Mary = $8,000
Lincoln Company purchased merchandise from Grandville Corp. on September 30, 2018. Payment was made in the form of a noninterest-bearing note requiring Lincoln to make six annual payments of $5,400 on each September 30, beginning on September 30, 2021.
(FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.)
Calculate the amount at which Lincoln should record the note payable and corresponding purchases on September 30, 2018, assuming that an interest rate of 9% properly reflects the time value of money in this situation.
Answer:
Merchandise inventory 20,388.82 debit
Note payable 20,388.82 credit
Explanation:
First we calculate the present value of the annuity at 9% discount rate
[tex]C \times \frac{1-(1+r)^{-time} }{rate} = PV\\[/tex]
C 5,400.00
time 6
rate 0.09
[tex]5400 \times \frac{1-(1+0.09)^{-6} }{0.09} = PV\\[/tex]
PV $26,404.1168
Then, we discount this value by the three year grace period between the purchase and the first payment
[tex]\frac{Maturity}{(1 + rate)^{time} } = PV[/tex]
Maturity 26,404.12
time 3.00
rate 0.09000
[tex]\frac{26404.1168220993}{(1 + 0.09)^{3} } = PV[/tex]
PV 20,388.8228
Received contributions of $ 10 comma 000$10,000 in exchange for common stock. a. Increase asset (Cash) ; Increase equity (Common Stock) b. Purchased equipment for $ 5 comma 000$5,000 on account.
Answer:
The answer is stated below:
Explanation:
A. Received or collected $10,000 in exchange of the common stock:
This transaction will have an impact on the Accounting Equation of the Accounts, which is :
Assets = Liabilities + Equity
As the cash is received, there will be an increase in the assets and under the cash account of the current assets. Though the cash is against the common stock, which increases the common stock account upon the side of the equity.
Therefore, it will be:
Increase in assets (Cash) : Increase in equity (Common Stock)
B. Bought the equipment on account worth $5,000.
This transaction will have an impact on the Accounting Equation as:
As the equipment is purchased will in turn lead to increase in the assets side, under the equipment account and it is purchased on account, which means on credit, that leads to increase in the liability under the Accounts Payable account.
Therefore, it will be:
Increase in assets (Equipment) : Increase in Liability (Accounts Payable)
Classify each statement as true or false by dragging it into the corresponding category.
- When two countries choose to partake in international trade, it is a mutually beneficial activity for both countries.
-Through specialization and trade, it is possible for a country to consume a combination of goods that is beyond its original production possibilities frontier.
-Wealthier countries always benefit more from international trade than poorer countries do
- Countries trade for goods in which they do not have a comparative advantage, and therefore, would never trade with nations that have similar resource endowments.
Through specialization and trade, it is possible for a country to consume a combination of goods that is beyond its original production possibilities frontier - is a TRUE statement as import facilities make it possible to have goods from any part of the world.
Wealthier countries always benefit more from international trade than poorer countries do - is a FALSE statement as the benefit depends on the profitability of the trade.
Countries trade for goods in which they do not have a comparative advantage, and therefore, would never trade with nations that have similar resource endowments - is a FALSE statement as countries actually choose to trade in commodities that dispense comparative advantage so as to gain more profits.
Finance professionals make decisions that fall into three distinctive areas: corporate finance, capital markets, and investments.
Below is a set of decisions made by finance professionals. Categorize the decisions according to the area of finance to which they belong.
1. Radford is a small company that manufactures automobile bearings. Managers at the company must make decisions on the kind and the cost of equipment to buy.
2. Chris works for a financial advising firm. he must create a financial plan and come up with a list of securities that his client can invest in. Chris must make decisions regarding the investments that he should recommend to his client to include in his or her portfolio.
3. Brandon works for an investment bank and makes decisions about the sale of new common stock by ABCL Inc.
Answer:
1. Radford is a small company that manufactures automobile bearings. Managers at the company must make decisions on the kind and the cost of equipment to buy - Investments.
2. Chris works for a financial advising firm. he must create a financial plan and come up with a list of securities that his client can invest in. Chris must make decisions regarding the investments that he should recommend to his client to include in his or her portfolio - Corporate Finance.
3. Brandon works for an investment bank and makes decisions about the sale of new common stock by ABCL Inc. - Corporate Finance.
Explanation:
(1) Option no. 1 relates to the decision making with respect to production equipments. This decision making falls into the category of Capital budgeting (fixed assets investing) decisions. These kind of decisions are investing decisions and thereby will fall under investments domain.
(2) Option no. 2 majorly relates to the functioning of important functions by an financial advising firm, which are necessary for its value creation. Hence, the decision will fall under Corporate Finance and not in Capital markets domain, as making a financial plan for portfolio recommendation to clients is the major activity of any Financial Advising firm.
(3) Option no. 3 again relates to the decision making by an investment bank, which is at the heart of its operations i.e. Initial Public Offer or Follow on Public Offer advisory to a firm. Hence, the decision making falls under Corporate Finance.
Custer County is considering raising revenues by imposing a $25 fee on couples who obtain a marriage license within the county.
Does this fee meet the definition of a transaction-based tax?
Answer:
The payment serves as a fee for the service rendered by government. It is slightly different from a transaction-based tax due to the fact that a private party and the jurisdiction are involved in a transaction instead of the normal operation in a market transaction that occurs between two or more private parties. This also gives the payer a certain opportunity which is the right to get married under law.
Explanation:
The payment serves as a fee for the service rendered by the government. It is slightly different from a transaction-based tax due to the fact that a private party and the jurisdiction are involved in a transaction instead of the normal operation in a market transaction that occurs between two or more private parties. This also gives the payer a certain opportunity which is the right to get married under the law.
Which country is a good example of a high present rate of investment and a low present rate of consumer goods consumption?
Mexico is a good example of a high present rate of investment and a low present rate of consumer goods consumption. Thus, option B is the correct option.
Mexico serves as a compelling illustration of a nation experiencing a robust current investment rate juxtaposed against a relatively modest level of consumer goods consumption. The country directs a significant portion of its resources towards expanding industries, infrastructure, and technological advancements, fostering economic growth. This emphasis on investment bolsters its potential for future prosperity.
Simultaneously, Mexico maintains a measured approach to consumer goods consumption, potentially stemming from factors like income distribution and cultural preferences. This unique balance signifies a strategic focus on long-term economic development while managing immediate consumption patterns, offering insights into Mexico's forward-looking economic strategy.
Thus, option B is the correct option.
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Probably the full options are:
A. Germany
B. Mexico
C. United States
D. United Kingdom
China is an example of a country with a high present rate of investment and a low present rate of consumer goods consumption. The government and businesses focus on infrastructure and capital investments instead of consumer goods consumption, resulting in significant economic growth and development.
Explanation:
A good example of a country with a high present rate of investment and a low present rate of consumer goods consumption is China. China is well known for its investment-led growth model, whereby the government and businesses allocate a significant portion of the country's resources to infrastructure, manufacturing, and other forms of capital investment, rather than individual consumer goods consumption. This has resulted in remarkable economic growth and development, albeit with a lower rate of consumption.
The Chinese government encourages this approach to stimulate long-term growth and reduce its dependence on foreign markets. As a result of this focus on investment rather than consumption, citizens may have less purchasing power or consume less, but the overall economy benefits from heightened stability and continuous growth.
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Functional strategy is the set of activities that each _________ will pursue in order to help the firm accomplish its competitive goals.
Answer:
department or functional area
Explanation:
Three types of strategies are identified in the management system: corporate strategy; functional strategy; of agricultural units
strategy.
1) Corporate strategy - defines perspective development of the enterprise as a whole. It focuses on the mission of the enterprise and serves the ultimate goal of the enterprise - maximizing profit. Choosing the type of economic activity at the level of the corporate strategy, maintaining the long-term competitive advantage of the enterprise; The most important issues, such as the allocation of resources across the strategic areas of the mirror, are addressed by senior managers.
2) The functional strategy of the enterprise is formed by the main functional units in each activity area, we can call these units as departments or functional areas too. Functional strategies are used in the following areas: marketing, production, finance, personnel, investment and innovation. Functional strategy of the enterprise is aimed at deeper study of its corporate strategy (realization of the main purpose of the enterprise) and provision of resources of separate economic units. Functional division managers are involved in the development of strategies for key functional units.
3) Business unit strategy - (business strategy usually serves two purposes - competitive advantage of a specific product and increase of its profitability. Business management in the new region, etc. At this level, managers and managers of business units are involved in the development of strategies, advice and assistance of managers in the development of corporate strategy.
A functional strategy marks the set of actions for each department within a company, aiding in achieving its competition goals. This can involve decisions relating to focus on few products, termed as 'core competency', for better success.
Explanation:A functional strategy refers to the set of activities that each department within a firm will pursue in order to help the company achieve its competitive goals.
These strategies are part of a larger business plan, focusing on areas like Finance, Marketing, HR, or Operations to improve the overall functionality and performance of the corporation.
For instance, a production department may involve important decisions that define a firm's behavior, like focusing on one or few products, which is sometimes referred to as its 'core competency.' This can lead to more success than firms that try to manage a wide range of products.
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