Answer:
There is no principal in this room.
Explanation:
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Robert Solomon and Fernando Flores argue that trust is a choice to believe the trusted person is telling the truth, without independent verification. If bluffing is an accepted rule of business negotiation, can the Solomon and Flores form of trust exist in business?
Does your answer (whatever it is) imply anything about the morality of bluffing?
Answer:
Yes.
Explanation:
Yes, the Solomon and Flores form of trust exist in business if bluffing is an accepted rule of business negotiation because bluffing is acceptable in the business. If bluffing is an accepted rule of business negotiation then there is no trust formed between Solomon and Flores and the reason for this is that bluffing is a bad act which makes relationship worse between the partners but in this case trust exist in business due to the rule of bluffing.
Convert each of the following estimates of useful life to a straight-line depreciation rate, stated as a percentage, assuming that the residual value of the fixed asset is to be ignored: (a) 4 years, (b) 8 years, (c) 10 years, (d) 16 years, (e) 25 years, (f) 40 years, (g) 50 years. If required, round your answers to two decimal places.
A Mike’s Milk estimates gallon milk sales for the first quarter as 12,000 gallons in January, 15,000 in February and 10,000 in March. Mike sells milk for $3.00 per gallon. Complete the following schedule for the first quarter sales budget.
Forecasted gallons January February March
Price Per gallon
Sales Budget
Answer:
Results are below.
Explanation:
Giving the following information:
A Mike’s Milk estimates gallon milk sales for the first quarter as 12,000 gallons in January, 15,000 in February, and 10,000 in March.
January:
Forecasted gallons= 12,000
Price per gallon= 3
Sales Budget= $36,000
February:
Forecasted gallons= 15,000
Price per gallon= 3
Sales Budget= $45,000
March:
Forecasted gallons= 10,000
Price per gallon= 3
Sales Budget= $30,000
Pet Supply purchased some fixed assets two years ago at a cost of $43,800. It no longer needs these assets so it is going to sell them today for $32,500. The assets are classified as five-year property for MACRS. The MACRS rates are 20%, 32% 19.2%, 11.52%, 11.52%, 5.76%, for years 1 to 6, respectively. What is the net cash flow (A-T Salvage Value) from this sale if the firm's tax rate is 35 percent
Answer:
$28,483.4
Explanation:
The computation of the net cash flow is shown below;
Asset cost $43,800
MACRS Rate 0.2 0.32
8760 14016
So total depreciation is
= $8,760 + $14,016
= $22,776
Now
Book Value of the company is
= oriignal value - depreication
= $43,800 - $22,776
= $21,024
And,
Sale price = 32500
So,
Gain is
= $32,500 - $21,024
= $11,476
So,
Tax = 0.35% of 11476
= $4,016
And, finally
Net cashflows is
= Sale price - tax
= $28,483.4
Answer:
The correct solution is "28483".
Explanation:
According to the question,
Given:
Sales price,
= 32500
MARCS rates,
= [tex]43800\times 0.2[/tex]
= [tex]8760[/tex]
Or,
= [tex]43800\times 0.32[/tex]
= [tex]14016[/tex]
Now,
The total depreciation will be:
= [tex]8760+14016[/tex]
= [tex]22776[/tex]
The company's book value will be:
= [tex]Original \ value-Depreciation[/tex]
= [tex]43800-22776[/tex]
= [tex]21024[/tex]
Gain will be:
= [tex]32500-21024[/tex]
= [tex]11476[/tex]
Tax,
= [tex]35\times 11476[/tex]
= [tex]4016[/tex]
hence,
The net cashflows will be:
= [tex]Sale \ price-Tax[/tex]
= [tex]32500-4016[/tex]
= [tex]28483[/tex]
Even though most corporate bonds in the united states make coupon payments semiannually, bonds issued elsewhere often have annual coupon payments. suppose a german company issues a bond with a par value of 1000 euros, 23 years to maturity, and a coupon rate of 5.8 percent paid annually.
Required:
If the yield to maturity is 7.5 percent, what is the current price of the bond?
Answer:
Bond Price= 816.29
Explanation:
Giving the following information:
YTM= 0.075
Coupon= 0.058*1,000= 58
Years to maturity= 23 years
Face value= 1,000
To calculate the price of the bond, we need to use the following formula:
Bond Price= cupon*{[1 - (1+i)^-n] / i} + [face value/(1+i)^n]
Bond Price= 58*{[1 - (1.075^-23)] / 0.075} + [1,000/(1.075^23)]
Bond Price= 626.79 + 189.5
Bond Price= 816.29
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Total assets were $78,000 and total liabilities were $42,000 at the beginning of the year. Net income for the year was $15,500, and dividends of $5,000 were declared and paid during the year.
Required:
Calculate total stockholders' equity at the end of the year.
Answer:
$46,500
Explanation:
Accounting equation is stated as :
Assets = Equity + Liabilities
therefore,
Equity = Assets - Liabilities
Equity at Beginning of the Period :
Equity = Assets - Liabilities
= $78,000 - $42,000
= $36,000
Equity at end of the Period
Closing Equity Balance = Opening Balance + Net Income - Dividends
= $36,000 + $15,500 - $5,000
= $46,500
A flexible-budget variance is $800 favorable for unit-related costs. This indicates that costs were: _____________
a. $800 more than the master budget
b. $800 less than for the planned level of activity
c. $800 more than standard for the achieved level of activity
d. $800 less than standard for the achieved level of activity
Answer: $800 less than standard for the achieved level of activity
Explanation:
A flexible budget variance refers to the difference that occurs between the results that are gotten by a flexible budget model and the actual results gotten.
Since the flexible-budget variance is $800 favorable for unit-related costs, this indicates that costs were $800 less than standard for the achieved level of activity.
Therefore, the correct option is D.
vThe profit for a product is increasing at a rate of $5600 per week. The demand and cost functions for the product are given by p = 6000 − 25x and C = 2400x + 5200, where x is the number of units produced per week. Find the rate of change of the sales with respect to Larson, Ron. Algebra and Trigonometry (p. 158). Cengage Learning. Kindle Edition.
Answer:
4 units per week
Explanation:
Calculation to Find the rate of change of sales
First step
dP/dt=5600
Second step
Since the revenue is the product of demand and sales
Hence,
R(x)=px
=(6000-25x)x
=6000x-25x²
Third step is to determine the profit which is the difference of revenue and cost.
Hence,
P(x)=R(x)-C(x)
=6000x-25x²-(2400x+ 5200)
=6000x- 25x² -2400x-5200
=3600x-25x²-5200
Fourth step is to Differentiate the profit with respect to time
dP/dt=3600 dx/dt- 50 dx/dt-0
=50(3600/50-x) dx/dt
=50(72-x) dx/dt
Now let Find the rate of change of sales when dP/dt=5600 and x =44
5600=50(72-44) dx/dt
5600=50(28) dx/dt
5600=1400 dx/dt
dx/dt=5600/1400
dx/dt= 4 units per week
Therefore the rate of change of sales is 4 units per week
The Menswear Department of Major's Department Store had sales of $198,000, cost of goods sold of $137,500, indirect expenses of $14,250, and direct expenses of $28,500 for the current period. The Menswear Department's contribution to overhead as a percent of sales is:
Answer:
the contribution to overhead as a percent of sales is 16.16%
Explanation:
The computation of the contribution to overhead as a percent of sales is given below;
Sales $198,000
Less: Cost of goods sold $137,500
Less: Direct Expenses $28,500
Contribution $32,000
Now the percentage should be
= $32,000 ÷ $198,000
= 16.16%
Hence, the contribution to overhead as a percent of sales is 16.16%
The Play It Again Sports chain carries all kinds of sports equipment at much lower prices than the typical sporting goods store. Typically, merchandise sold in the store has little, if any, wear. Being both a place for people to get rid of unwanted equipment and a source for people to buy affordable equipment and a source of new-to-you equipment,what is Play It Again Sports emphasizing? A) geographic lifestyles.B) public relations.C) the family life cycle.D) positioning.
Answer:
D) positioning.
Explanation:From the question we are informed about The Play It Again Sports chain who carries all kinds of sports equipment at much lower prices than the typical sporting goods store. Typically, merchandise sold in the store has little, if any, wear. Being both a place for people to get rid of unwanted equipment and a source for people to buy affordable equipment and a source of new-to-you equipment. In this case, Play It Again Sports is emphasizing positioning.
Positioning can be regarded as concept used by companies which involves association as well as development of a mental position in public consciousness concerning their brand as well as their products and services. minds of are usually been stuffed with different information, therefore it is important to choose a unique position in peoples mind.
Cordell Inc. experienced the following events in Year 1, its first year of operation:
Received $59,000 cash from the issue of common stock.
Performed services on account for $81,000.
Paid a $5,900 cash dividend to the stockholders.
Collected $65,000 of the accounts receivable.
Paid $59,000 cash for other operating expenses.
Performed services for $19,000 cash.
Recognized $2,900 of accrued utilities expense at the end of the year.
Required:
a. Identify the events that result in revenue or expense recognition and those which affect the statement of cash flows.
b. Based on your response to Requirement a, determine the amount of net income reported on the 2018 income statement.
Answer:
Cordell Inc.
a. Events that result in revenue or expense recognition:
Performed services on account for $81,000.
Paid $59,000 cash for other operating expenses.
Performed services for $19,000 cash
Recognized $2,900 of accrued utilities expense at the end of the year.
b. Events that affect the Statement of Cash Flows:
Received $59,000 cash from the issue of common stock.
Paid a $5,900 cash dividend to the stockholders.
Collected $65,000 of the accounts receivable.
Paid $59,000 cash for other operating expenses.
Performed services for $19,000 cash
b. The amount of the net income reported on the 2018 income statement is:
= $38,100.
Explanation:
a) Data and Analysis:
Cash $59,000 Common stock $59,000
Accounts Receivable $81,000 Service Revenue $81,000
Cash Dividend $5,900 Cash $5,900
Cash $65,000 Accounts receivable $65,000
Operating $59,000 Cash $59,000
Cash $19,000 Service Revenue $19,000
Utilities Expense $2,900 Utilities Payable $2,900
Revenue:
Accounts Receivable $81,000
Cash $19,000 $100,000
Expenses:
Operating $59,000
Utilities Expense $2,900 $61,900
Net income $38,100
You purchased a 20-year par value bond with semiannual coupons at a nominal annual rate of 8% convertible semiannually at a price of 1722.25. The bond can be called at par value X on any coupon date starting at the end of year 15 after the coupon is paid. The price guarantees that you will receive a nominal annual rate of interest convertible semiannually of at least 6%. Calculate X.
a. 1400
b. 1420
c. 1440
d. 1400
e. 1480
Answer:
1400
Explanation:
The concept par value bond refers to a bond that may be redeemed for its face value. From the coupon nominal annual rate of 8%, it means the coupon is 4% for half of the year is higher than the effective yield of 3% for 6 month period. As such, the bond sells at a higher premium price.
As a result, the minimum yield rate that contributes to the potential of the bond being called is computed at the initial conceivable call date, which is precisely 15 years after the date of purchase, because it is the most unfavorable period for the bondholder if the call occurs. As a result, the par value X fulfills the following condition:
[tex]1722.25 = 0.04*X*a_{|30|3\%|}+\dfrac{X}{1.03^{30}}[/tex]
Making X the subject:
[tex]X = \dfrac{1722.25}{0.04*a_{|30|3\%|}+1.03^{-30}}[/tex]
Using financial Calculator:
X = 1400.01
X ≅ 1400
A bond with a face value of $1,000 has 10 years until maturity, carries a coupon rate of 7.3%, and sells for $1,170. Interest is paid annually.a. If the bond has a yield to maturity of 10.7% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your anser to nearest whole number.)b. What will be the annual rate of return on the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)c. Now assume that interest is paid semiannually. What will be the annual rate of return on the bond?Slightly greater than your part b answerSlightly less than your part b answerd. If the inflation rate during the year is 3%, what is the annual real rate of return on the bond? (Assume annual interest payments.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)
Answer:
a. Price 1 year later = $810
b. Annual rate of return on the bond = -24.53%
c. Since -24.79% is lower than -24.53% obtained part b, this implies that annual rate of return is slightly less than our part b answer.
d. Annual real rate of return on the bond = -26.73%
Explanation:
a. If the bond has a yield to maturity of 10.7% 1 year from now, what will its price be at that time? (Do not round intermediate calculations. Round your answer to nearest whole number.)
This can be calculated as follows:
Price 1 year later = Coupon rate * Par value / Yield to maturity * (1 - 1 / (100% + Yield to maturity)^Years to maturity) + Par value / (100% + Yield to maturity)^Years to maturity = 7.3% * 1000 / 10.7% * (1 - 1 / (100% + 10.7%)^9) + 1000 / (100% + 10.7%)^9 = $810
b. What will be the annual rate of return on the bond? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)
This can be calculated as follows:
Annual rate of return on the bond = (Price 1 year later + Coupon rate * Par value) / Price now - 1 = (810 + 7.3% * 1000) / 1170 - 1 = -24.53%
c. Now assume that interest is paid semiannually. What will be the annual rate of return on the bond?Slightly greater than your part b answer Slightly less than your part b answer
This can be determined as follows:
Price 1 year later = (Coupon rate / 2) * Par value / (Yield to maturity / 2) * (1 - 1 / (100% + (Yield to maturity / 2))^(Years to maturity * 2)) + Par value / (100% + (Yield to maturity / 2))^(Years to maturity * 2) = (7.3% / 2) * 1000 / (10.7% / 2) * (1 - 1 / (100% + (10.7% / 2))^(9 * 2)) + 1000 / (100% + (10.7% / 2))^(9 * 2) = $807
Annual rate of return on the bond = (Price 1 year later + Coupon rate * Par value) / Price now - 1 = (807 + (7.3% / 2) * 1000) / 1170 - 1 = -24.79%
Since -24.79% is lower than -24.53% obtained part b, this implies that annual rate of return is slightly less than our part b answer.
d. If the inflation rate during the year is 3%, what is the annual real rate of return on the bond? (Assume annual interest payments.) (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Negative amount should be indicated by a minus sign.)
This can be calculated as follows:
Annual real rate of return on the bond = (1 + nominal return) / (1 + inflation)-1 = (1 - 24.53%) / (1 +3 %) - 1 = -26.73%
Lash World Pool Supplies wants its salespeople to call on pool wholesalers five times per year and to spend two hours on each sales call. Every salesperson works a 40-hour week and takes off two weeks for vacation each year. A salesperson must spend half of the time on travel and administration. Approximately how many salespeople does Splash World need to service 1000 accounts?
a)10
b) 20
c) 8
d) 2
e) 24
Answer:
a) 10
Explanation:
Calculation to determine Approximately how many salespeople does Splash World need to service 1000 accounts
First step is to determine the selling time
Using this formula
Selling time=Number of customers *Sales calls per year*Hours per sales call
Let plug in the formula
Selling time=1000 * 5 *2 hours
Selling time= 10,000 hours
Second step is to determine the number of hours they used to sell
Hours to sell= (40 hours per wweek* 50 weeks)*1/2
Hours to sell = 2000 hours per year*1/2
Hours to sell= 1000 hours per year.
Now let determine how many salespeople does Splash World need to service 1000 accounts
Number of salespeople=10,000 hours /1000 hours per year
Number of salespeople=10
Therefore Approximately how many salespeople does Splash World need to service 1000 accounts will be 10 salespeople
Kingston Co. uses the percentage-of-receivables basis to record bad debt expense. It estimates that 1% of accounts receivable will become uncollectible. Accounts receivable are $420,000 at the end of the year, and the allowance for doubtful accounts has a credit balance of $1,500. (a) Prepare the adjusting journal entry to record bad debt expense for the year. (b) If the allowance for doubtful accounts had a debit balance of $800 instead of a credit balance of $1,500, determine the amount to be reported for bad debt expense
Answer:
a. Dr Bad Debts Expense $2,700
Cr Allowance for doubtful accounts $2,700
b. $5000
Explanation:
(a) Prepare the adjusting journal entry to record bad debt expense for the year.
Debit Bad Debts Expense [($420,000 x 1%) – $1,500] $2,700
Credit Allowance for doubtful accounts $2,700
(b) If the allowance for doubtful accounts had a debit balance of $800 instead of a credit balance of $1,500, determine the amount to be reported for bad debt expense
Bad debt expense = $4200 + $800 = $5000
DL variances
Logen Construction builds standard prefabricated wooden frames for walls. Each frame requires five direct labor hours and the standard hourly direct labor rate is $18. During July, the company produced 670 frames and worked 3,310 direct labor hours. Payroll records indicate that workers earned $60,407.50.
a. What were the standard hours for July production?
hours
b. What was the actual hourly wage rate? Round your answer to the nearest cent.
$ per hour
c. Calculate the direct labor variances. Round your answers to the nearest cent.
Labor Rate Variance $
Labor Efficiency Variance $
Total Labor Variance $
Answer:
Logen Construction
a. Standard hours for July Production = 3,350
b. Actual hourly wage rate = $18.25
c. Direct labor variances:
i. Labor Rate Variance = $827.50 U
ii. Labor Efficiency Variance = $720 F
iii. Total Labor Variance = $107.50 U
Explanation:
a) Data and Calculations:
Direct labor hours per frame = 5 hours
Standard hourly labor rate = $18
Standard direct labor cost per frame = $90 ($18 * 5)
Number of frames produced in July = 670
Actual direct labor hours = 3,310
Actual wages earned by workers = $60,407.50
a. Standard hours for July Production = Actual production unit multiplied by standard hours per unit
= 3,350 (670 * 5) hours
b. Actual hourly wage rate = Actual direct labor cost divided by actual direct labor hours
= $18.25 ($60,407.50/3,310)
c. Direct labor variances:
i. Labor Rate Variance = Standard direct labor rate - Actual direct labor rate * Actual direct labor hours
= $827.50 U ($18 - $18.25) * 3,310
ii. Labor Efficiency Variance = Standard direct labor hours - Actual direct labor hours * Standard Direct Labor Rate
= $720 F (3,350 - 3,310) * $18
iii. Total Labor Variance = Standard Direct Labor Cost - Actual Direct Labor Cost
= $107.50 U ($60,300 - $60,407.50)
Consider adopting a cost-reducing technology that lowers annual production costs by $1000 per year (into perpetuity, starting in year 1). If your opportunity cost of time is captured by a discount rate of 5%, what is the present) value of adopting the technology?
Answer:
$20,000
Explanation:
Present Value of Perpetuity = Annuity / ( Interest rate-Growth rate). Where Annuity=1000, Interest rate=5%, Growth rate=0
Present Value of Perpetuity = $1,000/(0.05-0)
Present Value of Perpetuity = $1,000/0.05
Present Value of Perpetuity = $20,000
So, the present) value of adopting the technology is $20,000.
The Financial Accounting Standards Board (FASB) is the body authorized to establish accounting principles for all colleges and universities and health care entities.
a. True
b. False
Answer:
The given statement is "False".
Explanation:
The agency or institution including all businesses, profit-oriented accept or reject, once again to create accountability guidelines, is determined as FASB.These are predicated on the notion that sometimes business, as well as the profession of investment products, function efficiently when there is trustworthy, succinct, as well as straightforward contact reporting.Thus the above is the correct answer.
Lisa Carson has the opportunity to receive $12,000 now or $15,000 in four years. If Lisa can earn 6 percent on her investments, what is the present value of the $15,000 payment?
Answer:
$11881.4
Explanation:
Given :
Future value, FV = $15,000
Interest rate, r = 6%
Period, n = 4 years
Using the Present Value formula :
PV = FV(1 ÷ (1 + r)^n)
15000(1 ÷ (1 + r)^n)
15000(1 ÷ (1 + 0.06)^4)
15000(1 ÷ 1.06^4)
15000(1 ÷ 1.26247696)
15000(0.7920936)
= $11,881.4
Kinds of managers An example of a position that a team leader would hold is: vice president. department manager. group facilitator. divisional manager Using your knowledge of the different levels of management in organizations·indicate whether each statements most middle-level, top-level managers, or team leaders. el, to aaay to ist ere Statement Project managers and others who bring people together from various parts of the organization to perform a task are in this layer of management. Having titles like chief executive officer (CEO), president, chairperson, and director general, these managers report directly to the board of directors. These managers are responsible for guiding and coaching the employees who actually do the work of the organization Level Middle managers Top managers First-line managers
Answer:
a. A Team leader would be a group facilitator.
Team leaders are meant to coordinate the activities of small groups in a company to achieve certain short term targets. They are therefore most suited to be group facilitators.
b.
Project managers and others who bring people together from various parts of the organization to perform a task are in this layer of management. ⇒ MIDDLE MANAGERS
Middle level managers are in charge of departments and divisions and have the goal of achieving the mandate set by the Top management. They do so by bringing together various parts of the organization under a division and work to achieve the set goals.
Having titles like chief executive officer (CEO), president, chairperson, and director general, these managers report directly to the board of directors. ⇒ TOP LEVEL MANAGERS
Top level managers sit on top of the hierarchy of the entire organization and report directly to the Board of Directors. They include positions like the CEO, President, CFO, Director-General, etc. They set the overall strategic goals of the company.
These managers are responsible for guiding and coaching the employees who actually do the work of the organization ⇒ FIRST-LINE MANAGERS.
First-line managers are the closest to the employees and so supervise them to carry out the goals passed onto them by first level managers. They include positions like office managers and plant supervisors.
Shen is concerned that a decline in interest rates might lead to annual income from his investments. If interest rates ______________, the value of earnings from his investments will _________________. If his goal is to save for retirement, which bonds poses the biggest risk?
Answer:
Decline
Increase
Increase
Bond with low interest rate.
Explanation:
A decline in interest rates might lead to a decline of annual income
and if interest rates increase the value of earnings from his investments will Increase
Given that his goal is to save for retirement and not to sell off, The bonds that poses the biggest risk is the bond with a low interest rate
Aziz company sells two types of products, Baste and Deluxe . The company provides technical support for users of its products at an expected cost of $150,000 per year. The company expects to process 10,000 customer service calls per year.
Required:
1. Determine the company's cost of technical support per customer service call.
2. During the month of January Aziz received 520 calls for customer service on its deluxe model and 220 calls for customer service on its basic model. Assign technical support costs to each model using activity based costing (ABC).
Answer:
1.$25
2. Deluxe $13,000
Basic $5,500
Explanation:
1. Calculation to determine the company's cost of technical support per customer service call.
Using this formula
Cost of technical support per customer service call = Expected cost / Expected customer service call
Let plug in the formula
Cost of technical support per customer service call = $150,000 / 10,000
Cost of technical support per customer service call = $25 per customer service call
Therefore the company's cost of technical support per customer service call is $25 per customer service call
2. Calculation to Assign technical support costs to each model using activity based costing
Model Activity Rate (a) Cost driver quantity incurred (b) Allocated Cost (a*b)
Deluxe $25 *520calls = $13,000
Basic $25* 220 calls = $5,500
Therefore the technical support costs assign to each model using activity based costing (ABC) is:
Deluxe $13,000
Basic $5,500
Three times a year previous donors receive donation cards in the mail from the local zoo. This organization also markets to visitors by sponsoring Make-A-Wish visits from the regional hospitals. What type of marketing did the zoo use
Question Completion with Options;
a. business-to-consumer (B2C) emphasis
b. business-to-business (B2B) emphasis
c. dual emphasis
Answer:
The type of marketing the zoo used is called:
dual emphasis marketing.
Explanation:
The dual marketing emphasis that the zoo uses embraces both business-to-consumer (B2C) and business-to-business (B2B) emphasis. While business-to-consumer takes the marketing effort directly to the consumers of the zoo's services, the business-to-business emphasis markets the zoo's services to organizations. Using a dual emphasis means that the local zoo markets her services to donors and visitors, individual and corporate.
On January 2, 20X3, Kean Company purchased a 30 percent interest in Pod Company for $250,000. Pod reported net income of $100,000 for 20X3 and declared and paid a dividend of $10,000. Kean accounts for this investment using the equity method. In its December 31, 20X3, balance sheet, what amount should Kean report as its investment in Pod?a. $160,000.b. $223,000.c. $340,000.d. $277,000.
Answer:
.d. $277,000.
Explanation:
The computation of the amount reported as the investment is shown below:
= The value of the investment + investor share of the net income - dividend share of the net income
= $250,000 + 30% of $100,000 - 30% of $3,000
= $250,000 + $30,000 - $3,000
= $277,000
Hence, the amount reported as the investment is $277,000
If Stephenson wishes to maximize its total market value, would you recommend that it issue debt or equity to finance the land purchase. Explain.
Answer:
The answer is issue debt finance
Explanation:
Should Stephenson wishes to maximize the total market value he should issue debt to finance the land purchase.
Why? - Because the interest payments of debt are tax deductible, A capital structure that has a debt will shrink the company’s taxable income, and will form a tax shield that will ultimately increase the total value of the company.
Suppose that the price of apples increases by 10%. Within a short amount of time, apple producers are able to increase the quantity of apples supplied by 2%. The higher price has made it worthwhile to use extra labor to reduce waste and spoilage. Is this short run adjustment showing elastic or inelastic supply? Explain.
Answer:
inelastic
Price elasticity of supply = 2% / 10% = 0.2
the coefficient of elasticity is less than 1. this means that supply is inelastic. the percentage increase in quantity supplied is less than the percentage increase in price
Explanation:
Price elasticity of supply measures the responsiveness of quantity supplied to changes in price of the good.
Price elasticity of supply = percentage change in quantity supplied / percentage change in price
If the absolute value of price elasticity is greater than one, it means supply is elastic. Elastic supply means that quantity supplied is sensitive to price changes.
Supply is inelastic if a small change in price has little or no effect on quantity supplied. The absolute value of elasticity would be less than one
supply is unit elastic if a small change in price has an equal and proportionate effect on quantity supplied.
A service provided by a business to the final user is known as:
consideration.
investments.
implied warranty.
economic services.
capital goods.
Answer:
economic services.
Explanation:
An economy is a function of how money, means of production and resources (raw materials) are carefully used to facilitate the demands and supply of goods and services to meet the unending needs or requirements of the consumers.
Hence, a region's or country's economy is largely dependent on how resources are being allocated and utilized, how many goods and services are to be produced, what should be produced, for whom they are to be produced for and how much money are to be spent by the consumers to acquire these goods and services.
Basically, there are four (4) main types of economy and these are;
I. Mixed economy.
II. Free market economy.
III. Traditional economy.
IV. Command economy.
A service provided by a business to the final user is known as economic services.
Basically, economic services are considered to be intangible, inconsistent and perishable in nature. Thus, some examples of economic services are banking, hospitality, transportation, telecommunication, marketing, legal, rentals, insurance, security, public relations, etc.
Periwinkle Manufacturing Company has the following budgeted costs for 10,000 units: Variable Costs Fixed CostsManufacturing $200,000 $75,000 Selling & Administrative 100,000 25,000Total $300,000 $100,000What is the initial selling price needed to obtain a target profit of $200,000 using the variable cost markup method?A. $30.B. $55.C. $60.D. $50.
Answer:
C. $60
Explanation:
Calculation to determine the initial selling price needed to obtain a target profit of $200,000 using the variable cost markup method
Using this formula
Contribution margin = (Selling price x Units produced) - Variable costs
Profit = Contribution - Fixed costs
Profit = $200,000
Fixed costs = $100,000
Variable costs = $300,000
$200,000 = Contribution -$100,000
Contribution=$200,000+$100,000
Contribution = $300,000
$300,000 = (Selling price x 10,000 units)-$300,000
Selling price=$300,000+$300,000/10,000 units
Selling price =$600,000 /10,000 units
Selling price = $60
Therefore the initial selling price that is needed to obtain a target profit of $200,000 using the variable cost markup method is $60
If the price of product L increases, then how will the demand curve for the close-substitute product J shift? If X is a normal good, will an increase in money income shift the supply or demand curve and in which direction?
Answer:
demand curve for product J would shift rightwards or outwards
If X is a normal good, an increase in income would shift the demand curve rightwards or outwards
Explanation:
Substitute goods are goods that can be used in place of another good.
If the price of product L increases, the quantity demanded of product L declines. this is line with the law of demand
According to the law of demand, the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded.
Consumers would then shift to the consumption of the close substitute. As a result, there would be an increase in the demand for product J. This would lead to a rightward or outward shift of the demand curve for product J
Normal goods are goods that are goods whose demand increases when income increases and falls when income falls
Since X is a normal good, when income increases, the demand for good X increases. this would shift the demand curve outward