Answer:
Princeton Fabrication, Inc.
1. Variable Manufacturing cost per unit:
$66
2. Full Manufacturing cost per unit:
= $77
3. Variable cost per unit:
$71
4. Full absorption cost per unit:
$100
5. Prime Cost per unit:
$42
6. Conversion Cost per unit:
$69
7. Profit margin per unit:
$37
8. Contribution Margin per unit:
$71
9. Gross margin per unit:
$60
Explanation:
a) Data and Calculations:
Quantity produced and sold in March = 1,400
Sales price (per unit) $137
Manufacturing costs:
Fixed overhead (for the month) 15,400
Direct labor (per unit) 8
Direct materials (per unit) 34
Variable overhead (per unit) 24
Marketing and administrative costs:
Fixed costs (for the month) 25,200
Variable costs (per unit) 5
b) Variable Manufacturing cost per unit:
Direct labor (per unit) 8
Direct materials (per unit) 34
Variable overhead (per unit) 24
Total variable cost per unit $66
c) Full Manufacturing cost per unit:
Variable cost ($66 x 1,400) = $92,400
Fixed overhead (for the month) 15,400
Total manufacturing cost = $107,800
$107,800/ 1,400 = $77
d) Variable cost per unit:
Direct labor (per unit) 8
Direct materials (per unit) 34
Variable overhead (per unit) 24
Variable costs (per unit) 5
Total variable costs per unit $71
e) Full absorption cost per unit:
Total variable costs ($71 * 1,400) = $99,400
Total fixed costs: manufacturing 15,400
Total fixed marketing & admin 25,200
Total absorption costs = $140,000
unit absorption cost = $140,000/1,400 = $100
f) Prime Cost per unit:
Direct labor (per unit) 8
Direct materials (per unit) 34
Prime cost per unit $42
g) Conversion Cost per unit:
Direct materials (per unit) 34
Overhead cost per unit 35 (fixed overhead + variable overhead) per Conversion cost per unit = $69
h) Profit margin per unit:
Selling price $137
Full cost 100
Profit margin $37
i) Contribution Margin per unit:
Selling price $137
Variable manufacturing cost $66
Contribution margin per unit $71
j) Gross margin per unit:
Selling price $137
Manufacturing cost 77
Gross margin $60
Cost of money Four fundamental factors affect the cost of money: (1) the return that borrowers expect to earn on their investments, (2) the preference of savers to spend their income in the current period rather than delay their consumption until some future period, (3) the risks associated with the investment, and (4) expected inflation. Consider the following statements that address these factors, and indicate which you think are true.
Statement 1: All things being equal, rational savers and investors prefer to invest in an asset that provides a 12% return rather than one that provides an 8% return.
Statement 2: All things being equal, savers and investors prefer more risk to less risk and prefer lower risk premiums on projects exhibiting higher levels of risk.
Statement 3: On average and everything else held constant, borrowers will attempt to pay the maximum possible cash flows that will motivate savers and investors to participate in the transaction.
Statement 4: All things being equal, savers and investors expect to receive some amount of maturity premium as compensation for their deferred consumption.
The true statements are:______.
a. 1, 2, and 3.
b. 1 and 3.
c. 2 and 4.
d. 1, 2, 3, and 4.
Answer:
b. 1 and 3.
Explanation:
The investors are of two types either they are risk averse or risk seekers. Risk averse are those who are not willing to take risks for their investments. They accept lower returns but they are not ready to take more risks than their appetite. Risk seekers are those who demand more risk for more returns. The risks level is so high that even their whole investments can go away but they take this risk to achieve high extra ordinary returns.
a.A check for $100 was returned as NSF by the bank. The bank charged a returned check $25 processing fee. b.The March 31st cash receipts of $3,428 were placed in the night drop box after the bank closed. c.A $15 debit memo for checks printed by the bank was included with the canceled checks. d.Outstanding checks amounted to $2,565. e.A customer's note for $1,500 was collected by the bank and a collection fee of $25 was deducted. f.A check for $325 which was drawn on another company was included with the canceled checks.
Answer:
The question is missing the first part and I couldn't find any other question that has the same numbers.
when you are reconcile the bank account:
add deposits in transit $3,428
add the check from another company that was incorrectly canceled $325
subtract outstanding checks ($2,565)
reconciled bank account = X + $1,188
to reconcile the cash account:
add collection of note receivable $1,500
subtract collection fee ($25)
subtract the NSF check ($100)
subtract bank processing fees ($25)
subtract cost of printing checks ($15)
reconciled cash account = Y + $1,335
1. To gain profit and earn a living.
The accounts in the ledger of Ivanhoe Delivery Service contain the following balances on July 31, 2022.
Accounts Receivable $15,000
Prepaid Insurance $ 3,400
Accounts Payable 10,000
Service Revenue 17,300
Cash ?
Dividends 880
Equipment 59,550
Common Stock 40,190
Maintenance and Repairs Expense 3,758
Salaries and Wages Expense 8,628
Insurance Expense 720
Salaries and Wages Payable 990
Notes Payable (due 2025) 29,650
Retained Earnings (July 1, 2022) 6,400
Prepare trial balance
Answer:
Ivanhoe Delivery Service
Trial Balance
For the month ended July 31, 2022
debit credit
Cash $12,594
Accounts Receivable $15,000
Prepaid Insurance $3,400
Equipment $59,550
Accounts Payable $10,000
Salaries and Wages Payable $990
Notes Payable (due 2025) $29,650
Common Stock $40,190
Retained Earnings (July 1, 2022) $6,400
Service Revenue $17,300
Maintenance and Repairs Expense $3,758
Salaries and Wages Expense $8,628
Insurance Expense $720
Dividends $880
Totals $104,530 $104,530
Explanation:
cash = ($40,190 + $6,400 + $29,650 + $990 + $17,300 + $10,000) - ($15,000 + $3,400 + $880 + $59,550 + $3,758 + $8,628 + $720) = $104,530 - $91,936 = $12,594
The following information was drawn from the accounting records of Wyckoff Company as of December 31, Year 2, before the temporary accounts had been closed. The Cash balance was $3,600, and Notes Payable amounted to $4,000. The company had revenues of $7,500 and expenses of $3,400. The company’s Land account had a $8,000 balance. Dividends amounted to $1,000. The balance of the Common Stock account was $2,000.
Required:
A. Identify which accounts would be classified as permanent and which accounts would be classified as temporary.
B. Assuming that Wyckoff's beginning balance (as of January 1, Year 2) in the Retained Earnings account was $2,500, determine its balance after the temporary accounts were closed at the end of Year 2.
C. What amount of net income would Wyckoff Company report on its Year 2 income statement?
D. Explain why the amount of net income differs from the amount of the ending Retained Earmings balance.
E. What are the balances in the revenue, expense, and dividend accounts on January 1, Year 3?
Answer:
Wyckoff Company
A. Identification of permanent and temporary accounts:
Permanent:
Cash $3,600
Notes Payable $4,000
Land $8,000
Common Stock $2,000
Temporary:
Revenue $7,500
Expenses $3,400
Dividends $1,000
B. Retained Earnings balance, December 31, Year 2: $5,600
C. Amount of net income = $4,100
D. The net income of $4,100 does not include the beginning balance of retained earnings of $2,500 and the dividends.
E. The balances in the revenue, expense, and dividend accounts on January 1, Year 3 are $0, $0, and $0. They are not permanent accounts and as temporary accounts were closed to the Income Summary of Year 2.
Explanation:
a) Data and Calculations:
Wyckoff company
Account balances as of December 31, Year 2:
Cash $3,600
Notes Payable $4,000
Revenue $7,500
Expenses $3,400
Land $8,000
Dividends $1,000
Common Stock $2,000
b) Wyckoff Income Statement
Revenue $7,500
Expenses $3,400
Net income $4,100
Retained Earnings Statement
Net Income $4,100
Balance, January 1 2,500
Dividends (1,000)
Balance, Dec. 31 $5,600
On February 1, 2018, Cromley Motor Products issued 6% bonds, dated February 1, with a face amount of $65 million. The bonds mature on January 31, 2022 (4 years). The market yield for bonds of similar risk and maturity was 8%. Interest is paid semiannually on July 31 and January 31. Barnwell Industries acquired $65,000 of the bonds as a long-term investment. The fiscal years of both firms end December 31. (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.)
Required:
1. Determine the price of the bonds issued on February 1, 2018.
2-a. Prepare amortization schedules that indicate Cromley’s effective interest expense for each interest period during the term to maturity.
2-b. Prepare amortization schedules that indicate Barnwell’s effective interest revenue for each interest period during the term to maturity.
3. Prepare the journal entries to record the issuance of the bonds by Cromley and Barnwell’s investment on February 1, 2018.
4. Prepare the journal entries by both firms to record all subsequent events related to the bonds through January 31, 2020.
Answer:
1. Determine the price of the bonds issued on February 1, 2018.
the market value of each bond:
PV of face value = $1,000 / (1 + 4%)⁸ = $730.69PV of coupon payments = $30 x 6.7327 (PV annuity factor, 4%, 8 periods) = $201.98market price per bond = $932.67
2-a. I used an excel spreadsheet since there is not enough room here: Cromley Motors PDF
2-b. Again I used an excel spreadsheet since there is not enough room here:
3. February 1, 2018, bonds issued at a discount
Dr Cash 60,623,550
Dr Discount on bonds payable 4,376,450
Cr Bonds payable 65,000,000
4. Cromley's records:
July 31, 2018, first coupon payment
Dr Interest expense 2,424,942
Cr Cash 1,950,000
Cr Discount on bonds payable 474,942
January 31, 2019, second coupon payment
Dr Interest expense 2,443,940
Cr Cash 1,950,000
Cr Discount on bonds payable 493,940
July 31, 2019, third coupon payment
Dr Interest expense 2,463,697
Cr Cash 1,950,000
Cr Discount on bonds payable 513,697
January 31, 2020, fourth coupon payment
Dr Interest expense 2,484,245
Cr Cash 1,950,000
Cr Discount on bonds payable 534,245
Barnwell's records:
July 31, 2018, first coupon payment
Dr Cash 1,950
Dr Discount on bonds payable 2,425
Cr Interest revenue 475
January 31, 2019, second coupon payment
Dr Cash 1,950
Dr Discount on bonds payable 494
Cr Interest revenue 2,444
July 31, 2019, third coupon payment
Dr Cash 1,950
Dr Discount on bonds payable 514
Cr Interest revenue 2,464
January 31, 2020, fourth coupon payment
Dr Cash 1,950
Dr Discount on bonds payable 556
Cr Interest revenue 2,484
Builder Products, Inc., uses the weighted-average method in its process costing system. It manufactures a caulking compound that goes through three processing stages prior to completion. Information on work in the first department, Cooking, is given below for May:
Production data:
Pounds in process, May 1; materials 100% complete; conversion 80% complete 10,000
Pounds started into production during May 100,000
Pounds completed and transferred out _____
Pounds in process, May 31; materials 70% complete; conversion 30% complete 50,000
Cost data:
Work in process inventory, May 1:
Materials cost $152,300
Conversion cost $63,300
Cost added during May:
Materials cost $791,450
Conversion cost $348,100
Required:
a. Compute the equivalent units of production for materials and conversion for May.
b. Compute the cost per equivalent unit for materials and conversion for May.
c. Compute the cost of ending work in process inventory for materials, conversion, and in total for May.
d. Compute the cost of units transferred out to the next department for materials, conversion, and in total for May.
e. Prepare a cost reconciliation report for May.
Answer:
a. Equivalent units
Materials = Beginning inventory + Units started and completed + Ending Inventory
Units started and completed = Pounds started into production - Pounds in process
= 100,000 - 50,000 = 50,000
= 10,000 + 50,000 + (70% * 50,000)
= 95,000
Conversion
= 10,000 + 50,000 + (30% * 50,000)
= 75,000
b. Material Cost per equivalent unit = Material cost/ Equivalent material units
= (Beginning material cost + Cost during May) / 95,000
= (152,300 + 791,450)/95,000
= $9.93
Conversion cost per Equi unit = Conversion cost/ Equivalent Conversion units
= (63,300 + 348,100)/75,000
= $5.49
c. Cost of Ending WIP Material = Material ending WIP * Cost per equivalent unit
= (70% * 50,000) * 9.93
= $347,550
Cost of Ending WIP Conversion = Conversion ending WIP * Cost per equivalent unit
= (30% * 50,000) * 5.49
= $82,350
Total = 347,550 + 82,350 = $429,900
d. Units completed and transferred out = Beginning WIP inventory + Units started during May - Ending inventory
= 10,000 + 100,000 - 50,000
= 60,000
Materials cost transferred
= 60,000 *9.93
= $595,800
Conversion Cost transferred
= 60,000 * 5.49
= $329,400
Total = 595,800 + 329,400 = $925,200
e.
Beginning WIP inventory(152,300 + 63,300) $215,600
Current costs (791,450 + 348,100) $1,139,550
Total costs $1,355,150
Cost accounted:
Cost of units completed and transferred $925,200
Cost of ending work in process $429,900
Total costs accounted for $1,355,150
During November, the following summary transactions were completed. Journalize the November Transactions.
Nov. 8 Paid $4,189 for salaries due employees, of which $2,183 is for November and $2,006 is for October.
10 Received $2,242 cash from customers in payment of account.
11 Purchased merchandise on account from Dimas Discount Supply for $9,440, terms 2/10, n/30.
12 Sold merchandise on account for $6,490, terms 2/10, n/30. The cost of the merchandise sold was $4,720.
15 Received credit from Dimas Discount Supply for merchandise returned $354.
19 Received collections in full, less discounts, from customers billed on sales of $6,490 on November 12.
20 Paid Dimas Discount Supply in full, less discount.
22 Received $2,714 cash for services performed in November.
25 Purchased equipment on account $5,900.
27 Purchased supplies on account $2,006.
28 Paid creditors $3,540 of accounts payable due.
29 Paid November rent $443.
29 Paid salaries $1,534.
29 Performed services on account and billed customers $826 for those services.
29 Received $797 from customers for services to be performed in the future.
Answer:
Journal Entries:
Nov. 8:
Debit Salaries Expense $2,183
Debit Salaries Payable $2,006
Credit Cash Account $4,189
To record the payment of salaries for October and November.
Nov. 10:
Debit Cash Account $2,242
Credit Accounts Receivable $2,242
To record the receipt of cash on account
Nov. 11:
Debit Inventory $9,440
Credit Accounts Payable (Dimas Discount Supply) $9,440
To record the purchase of goods on account, terms 2/10, n/30.
Nov. 12:
Debit Accounts Receivable $6,490
Credit Sales Revenue $6,490
To record the sale of goods on account, terms, 2/10, n/30.
Debit Cost of goods sold $4,720
Credit Inventory $4,720
To record the cost of goods sold.
Nov. 15:
Debit Accounts Payable (Dimas Discount Supply) $354
Credit Inventory $354
To record the credit received.
Nov. 19:
Debit Cash Account $6,360
Debit Cash Discount $130
Credit Accounts Receivable $6,490
To record the receipt of cash on account.
Nov. 20:
Debit Accounts Payable (Dimas Discount Supply) $9,086
Credit Cash Discount $182
Credit Cash Account $8,904
To record payment on account.
Nov. 22:
Debit Cash Account $2,714
Credit Service Revenue $2,714
To record receipt of cash for services performed.
Nov. 25:
Debit Equipment $5,900
Credit Accounts Payable $5,900
To record the purchase of equipment on account.
Nov. 27:
Debit Supplies $2,006
Credit Accounts Payable $2,006
To record the purchase of supplies on account.
Nov. 28:
Debit Accounts Payable $3,540
Credit Cash Account $3,540
To record payment on accounts.
Nov. 29:
Debit Rent Expense $443
Credit Cash Account $443
To record the payment of November rent.
Debit Salaries Expense $1,534
Credit Cash Account $1,534
To record the payment of salaries.
Debit Accounts Receivable $826
Credit Service Revenue $826
To record services performed on account.
Debit Cash Account $797
Credit Unearned Service Revenue $797
To record receipt of cash for services.
Explanation:
The journal entries record the business transactions as they occur on daily basis. The records show the accounts to be debited and credited in the general ledger.
Your boss suggests that a Cobb-Douglas production function could be a good representation of that country's income. Is your boss right?
a. Yes, you can tell by the way the income shares for each factor move in opposite directions over time.
b. No, if it were a Cobb-Douglas production function, the income shares would be constant over time.
c. The production function cannot be determined without knowing how real GDP changed over time.
d. No, if it were a Cobb-Douglas production function, the income shares would change in the same direction over time.
Answer: b. No, if it were a Cobb-Douglas production function, the income shares would be constant over time.
Explanation:
Cobb–Douglas production function is used to show the technological relationship that takes place between the inputs and output that the inputs on the production process can produce.
In this scenario, we are informed that the boss suggests that a Cobb-Douglas production function could be a good representation of that country's income. In this case, the answer is No. The Boss is wrong because if it was to be a Cobb-Douglas production function , then the income share would be constant over time.
In this case, we can see that there is fluctuation of the factor shares as they're not constant but rather changes with time.
Newton Inc. uses a calendar year for financial reporting. The company is authorized to issue 9,000,000 shares of $10 par common stock. At no time has Newton issued any potentially dilutive securities. Listed below is a summary of Newton's common stock activities. 1. 1Number of common shares issued and outstanding at December 31, 2018 2,000,000 2. 1Shares issued as a result of a 10% stock dividend on September 30, 2019 200,000 3. 1Shares issued for cash on March 31, 2020 2,000,000 1Number of common shares issued and outstanding at December 31, 2020 4,200,000 4. 1A 2-for-1 stock split of Newton's common stock took place on March 31, 2021 Instructions a. Compute the weighted-average number of common shares used in computing earnings per common share for 2019 on the 2020 comparative income statement. b. Compute the weighted-average number of common shares used in computing earnings per common share for 2020 on the 2020 comparative income statement. c. Compute the weighted-average number of common shares to be used in computing earnings per common share for 2020 on the 2021 comparative income statement. d. Compute the weighted-average number of common shares to be used in computing earnings per common share for 2021 on the 2021 comparative income statement.
Answer:
A. $2,200,000
B. $3,700,000
C. $7,400,000
D. $ 8,400,000
Explanation:
a. Computation for the weighted-average number of common shares used in computing earnings per common share for 2019
Jan 1, 2019-Sept. 30, 2019 2,000,000 /12 * 9 =1,500,000
Adjustment for stock dividend 10%
Jan 1, 2019-Sept. 30, 2019 as adjusted (1,500,000 *1. 10) 1,650,000
Add Oct. 1, 2019- Dec. 31, 2019
( 2,200,000 /12 x 3 ) 550,000
Total weighted average Outstanding shares $2,200,000
(1,650,000+550,000)
b. Computation for the weighted-average number of common shares used in computing earnings per common share for 2020
Jan.1, 2020 - Mar. 31,2020
(2,000,000 /12 x 3) 550,000
Add:Apr. 1, 2020 - Dec. 31, 2020
(4,200,000 /12 x 9 )=3,150,000
Total weighted average Outstanding shares $3,700,000
(3,150,000+550,000)
c. Computation for the weighted-average number of common shares to be used in computing earnings per common share for 2020
2020 weighted average number of shares previously computed 3,700,000
×Adjustment for stock split (2 for 1) 2
= Total weighted average Outstanding shares $7,400,000
d. Computation for the weighted-average number of common shares to be used in computing earnings per common share for 2021
Jan. 1, 2021 - Mar. 31, 2021
4,200,000/ 12 x 3 =(1,050,000)
Adjustment for stock split (2 for 1) 2
Jan. 1, 2021- Mar. 31, 2021 adjusted
(1,050,000 x 2) 2,100,000
Add (4,200,0000*2) 8,400,000 1 April,2021 - 31 December,2021
( 8,400,000 * 9 / 12) = 6,300,000 (After split up)
Total weighted average Outstanding shares $ 8,400,000
(6,300,000+2,100,000)
Drag the tiles to the correct boxes to complete the pairs. Match the transactions to their relevant posting in the ledger.
Matching the transactions to their relevant posting in the ledger are;
Business purchases furniture: furniture account debited
Business sells furniture: furniture account credited
Business takes a loan from the bank: loan account debited
Business pays off the loan: loan account credited
The three primary categories of ledgers are;
1) General ledger: This is where accounts are kept that match the income statement and balance sheet they are intended for.
2) Sales ledger or debtor's ledger: This displays the current balance of money owed by clients to you and your business.
3) The purchase ledger, often known as the creditor's ledger, is a list of the goods and services a business has purchased, together with the amounts that have been paid and still need to be paid.
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Hankins, Inc., is considering a project that will result in initial after tax cash savings of $4.3 million at the end of the first year, and these savings will grow at a rate of 1.9 percent per year indefinitely. The firm has a target debt-equity ratio of .40, a cost of equity of 10.8 percent, and an aftertax cost of debt of 3.2 percent. The cost-saving proposal is somewhat riskier than the usual project the firm undertakes; management uses the subjective approach and applies an adjustment factor of +2 percent to the cost of capital for such risky projects.
Required:
a. Calculate the discount rate for the project.
b. What is the maximum cost the company would be willing to pay for this project?
Answer:
9.76%
$54,707,379.13
Explanation:
Given the following :
Debt - Equity ratio = 0.4
Weight of debt(Wd) = 0.4
Weight of equity (We) = 1 - 0.4 = 0.6
Cost of Equity (Ke) =10.8%
Initial cashflow = $4.3 million
After tax cost of debt (Rd) = 3.2%
Adjustment factor (A) = +2%
Growth rate = 1.9%
Weighted average cost of capital:
(Weight of equity * cost of equity) + (after tax cost of debt * weight of debt)
(0.6 * 10.8%) + (3.2% * 0.4) = 0.0776
=0.0776 * 100% = 7.76%
Add the adjustment factor :
WACC + A = 7.76% + 2% = 9.76%
Hence, discount rate = 9.76%
Maximum amount to pay:
Using the relation:
Present value (PV) = Initial cashflow /(discount rate - growth rate)
PV = 4,300,000/ (9.76% - 1.9%)
PV = 4,300,000 / 7.86%
PV = 4,300,000 / 0.0786
PV = $54,707,379.13
PV = maximum company will be willing to pay
Cost of Normal Spoilage
Frieling Company installs granite countertops in customers' homes. First, the customer chooses the particular granite slab, and then Frieling measures the countertop area at the customer's home, cuts the granite to that shape, and installs it. The Tramel job calls for direct materials of $2,300 and direct labor of $500. Overhead is applied at the rate of 130 percent of direct labor cost. Unfortunately, one small countertop breaks during installation and Frieling must cut another piece and install it to properly complete the job. The additional rework required direct materials costing $800 and direct labor costing $500. Assume that the spoilage was due to carelessness by a Frieling worker and it is considered to be normal spoilage.
Required:1. Calculate the cost of the Tramel job.2. Make any needed journal entry to the overhead control account.
3. What if the additional rework required $200 of direct labor? What would be the effect on the cost of the Tramel job?
Answer:
1. Calculation of the Cost of the Tramel Job
Particulars Amount
Direct material cost $2,300
Direct labor cost $500
Overhead applied $650 (500*130)
Total cost of job $3,450
2. Particulars Debit Credit
Overhead Cost $1,300
To materials $800
To Labour $500
3. The Cost of the Tramel Job will not be affected
Suppose a union successfully negotiates an increase in the wages of workers producing computer chips. This would lead to (a decrease, an increase) in the supply of computers, causing the price of computers to (rise, fall) . Because computers and computer software are (substitutes, complements) , this change in price would cause the demand for computer software to (increase, decrease) . However, computers and typewriters are (substitutes, complements) , so the change in the price of computers would (decrease, increase) the demand for typewriters.
Answer:
Decrease
rise
complements
decrease
substitutes
increase
Explanation:
As a result of the increase in wages would lead to an increase in the cost of production and as a result a fall in supply. As a result of the fall in supply, the price of computers would rise.
Complement goods are goods that can be used together. computers and computer software are used together. As a result of the rise in price of the computers, which would lead to fall in demand for computers, there would be less demand for the software. So, the demand for software would fall.
Substitute goods are goods that can be used in place of another good. A rise in price of computers would lead to a rise in demand for typewriters.
Kirk wants to get an FHA loan. Which of the following is Kirk himself not likely to do during the application process?
Answer:
C. Find a lender who is willing to do FHA-loans.
Explanation:
The Federal Housing Administration loan program was instituted by the United States government to make owning homes by the citizens easier. To be qualified, an applicant's minimum credit score should be 500 with a downpayment of 3.5% with a credit score of 580 and 10% for a credit score which is between 500 to 579. He must be willing to do, mortgage insurance, and the house which he wishes to own must meet the FHA's requirements.
However, it does not depend on him to find a lender willing to do FHA loans, rather, the lender must be approved by the Federal Housing Administration. He can only obtain his loan from an FHA-approved lending financial institution.
The Federal Housing Administration loan program was established by the US government to make homeownership more accessible to individuals.
To be considered, an applicant's credit score must be at least 500, with a downpayment of 3.5 percent for a credit score of 580 and 10% for a credit score of 500 to 579.
He must be ready to pay for mortgage insurance, and the home he seeks to purchase must fulfill FHA guidelines.
However, finding a lender ready to offer FHA loans is not his responsibility; rather, the lender must be approved by the Federal Housing Administration. Only an FHA-approved lending financial institution can provide him with a loan.
So, Option C is correct.
The other Options are incorrect as
Option A is incorrect as finding a home for an FHA loan is the most important thing so this is not the correct option.
Option B is incorrect as visiting an FHA office and ordering an appraisal on the home is also one of the important steps for an FHA loan.
Option D is incorrect as paying mortgage insurance lowers the risk to the lender making a loan to you.
Thus Option C is correct as this is the only option that is not necessary for an FHA loan.
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Halliburton and Schlumberger compete in the oil field services sector. Refer to the following 2018 financial data for the two companies to answer the requirements.
$ millions HAL SLB
Total revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $23,995 $32,815
Cost of sales and services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21,009 28,478
Average accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,135 7,983
Average inventory. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,712 4,028
Average accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,786 10,130
Marginal tax rate 22% 19%
Return on equity 18.56% 5.86%
a. Compute return on net operating assets (RNOA) for each company.
b. Disaggregate RNOA into net operating profit margin (NOPM) and net operating asset turnover (NOAT) for each company.
Do not round until your final answer. Round answers to two decimal places (percentage example: 0.12345 = 12.35%).
HAL SLB
RNOA
NOPM
NOAT
Answer:
a. Return of Net Operating Asset for each company
Amount$
Particulars HAL SLB
Net Operating Profits after tax
Net Income (after tax) 1,657 2,177
Marginal Tax Rate 22% 19%
Net Income (before tax) 2,124 2,688
(Net Income (after tax)*100/(100-Tax Rate)
Add : Pre tax net non operating Expense 653 426
Net Operating Income before tax 2,777 3,114
Marginal Tax Rate 22% 19%
Less Tax Expense (Net Operating Income) -611 -592
(before tax*Marginal Tax Rate)
Net Operating Income after tax $2,166 $2,522
Average Net Operating Assets HAL SLB
Average Operating Assets 23,361 67,836
Average Operating Liability 5,888 16,499
Average Net Operating Assets 17,473 51,337
RNOA = Net Operating Income after tax / Average Net Operating Assets (A/B)
HAL = 2,166 / 17,472 = 12.40%
SLB = 2,522 / 51,337 = 4.91%
b. Net Operating Profit Margin = (Net Operating Profits after tax/ Total Revenue *100)
Particulars HAL SLB
Net Operating Income after tax (Refer A) 2,166 2,522
Total Revenue 23,995 32,815
Net Operating Profit Margin 9.03% 7.69%
(Net Operating Profits after tax/ Total Revenue *100)
Net Operating Asset Turnover = (Total Revenue/ Average Net Operating Assets)
Particulars HAL SLB
Total Revenue 23,995 32,815
Average Net Operating Assets (Refer B) 17,473 51,337
Net Operting Asset Turnover 1.37times 0.64times
(Total Revenue/ Average Net Operating Assets)
Use the financial statements of Heifer Sports Inc. to find the information below for Heifer. (Use 365 days a year. Round all answers to 2 decimal places except $ amounts.)
Income Statement 2020
Sales $ 5,760,000
Cost of goods sold 3,045,000
Depreciation 302,500
Selling and administrative expenses 1,620,000
EBIT $ 792,500
Interest expense 174,000
Taxable income $ 618,500
Taxes 281,300
Net income $ 337,200
Balance Sheet, Year-End 2020 2019
Assets
Cash $ 41,100 $ 95,000
Accounts receivable 590,000 1,648,200
Inventory 438,100 1,146,500
Total current assets $ 1,069,200 $ 2,889,700
Fixed assets 2,821,000 6,771,000
Total assets $ 3,890,200 $ 9,660,700
Liabilities and Stockholders' Equity Accounts payable $ 312,400 $ 1,176,000
Short-term debt 505,000 1,445,500
Total current liabilities $ 817,400 $ 2,621,500
Long-term bonds 1,733,800 5,777,400
Total liabilities $ 2,551,200 $ 8,398,900
Common stock $ 313,900 $ 313,900
Retained earnings 1,025,100 947,900
Total stockholders' equity $ 1,339,000 $ 1,261,800
Total liabilities and stockholders' equity $ 3,890,200 $ 9,660,700
a. Inventory turnover ratio
b. Debt/equity ratio in 2020
c. Cash flow from operating activities in 2020
d. Average collection period
e. Asset turnover ratio
f. Interest coverage ratio
g. Operating profit margin
h. Retun on equity
J. Compound leverage ratio
k. Net cash provided by operating activities
Answer:
See calculations below
Explanation:
a. Inventory turn over ratio = 1.92
b. Debt equity ratio = 1.67
c. Cash flow from operating activities in 2020 = $3,269,900
d. Average collection period = 71 days
e. Asset turnover ratio = 1.48
f. Interest coverage ratio = 4.56
g. Operating income = 13.76%
h. Return on equity = 25.18%
j. Compound leverage ratio = 2.27
K. Net cash provided by operating activities = $3,269,900
Please see the whole breakdown in the attached
What taxes in a paycheck will be exempted for a minor?
Answer:
0$
Explanation:
Answer:
Generally, if a minor's income does not exceed the standard deduction he or she will not be required to file a tax return. If the above scenario is true, then the minor can check the box on Form W-4 that classifies he or she as exempt from withholding.
Explanation:
Technology Accessories Inc. is a designer, manufacturer, and distributor of accessories for consumer electronic products. Early in 20Y3, the company began production of a leather cover for tablet computers, called the iLeather. The cover is made of stitched leather with a velvet interior and fits snugly around most tablet computers. In January, $750,000 was spent on developing marketing and advertising materials. For the first six months of 20Y3, the company spent an additional $1,400,000 promoting the iLeather. The product was ready for manufacture on January 21, 20Y3. Technology Accessories Inc. uses a job order cost system to accumulate costs for the iLeather. Direct materials unit costs for the iLeather are as follows:________.Leather $10.00
Velvet 5.00
Packaging 0.40
Total $15.40
The actual production process for the iLeather is fairly straightforward. First, leather is brought to a cutting and stitching machine. The machine cuts the leather and stitches an exterior edge into the product. The machine requires one hour per 125 iLeathers.
After the iLeather is cut and stitched, it is brought to assembly, where assembly personnel affix the velvet interior and pack the iLeather for shipping. The direct labor cost for this work is $0.50 per unit. The completed packages are then sold to retail outlets through a sales force. The sales force is compensated by a 20% commission on the wholesale price for all sales. Total completed production was 500,000 units during the year. Other information is as follows:
Number of iLeather units sold in 20Y3 460,000
Wholesale price per unit $40
Factory overhead cost is applied to jobs at the rate of $1,250 per machine hour. An additional 22,000 cut and stitched iLeathers were waiting to be assembled on December 31, 20Y3.
Instructions
1. Prepare an annual income statement for the iLeather product, including supporting calculations, from the information provided.
2. Determine the balances in the finished goods and work in process inventories for the iLeather product on December 31, 20Y3.
Answer:
1. Net income = $656,000
2. Balance in finished goods inventories is $1,036,000; and balance in work in progress inventories is $558,800.
Explanation:
1. Prepare an annual income statement for the iLeather product, including supporting calculations, from the information provided.
Note: See the attach excel file for the annual income statement.
In the excel file, the following calculations are use:
Workings:
w.1: Units of ending finished goods = Units of finished goods produced - Units of finished goods sold = 500,000 - 460,000 = 40,000
w.2: Sales revenue = Selling price per unit * Unit of finished goods sold = $40 * 460,000 = $18,400,000
w.3: Overhead cost per unit = Cost per machine hour / Number of iLeather per machine hour = $1,250 / 125 = $10
w.4: Cost of goods manufactured per unit = Material cost per unit + Direct labor cost per unit + Overheads per unit = 15.4 + 0.5 + 10 = $25.90
w.5: Cost of goods sold = Cost of goods manufactured per unit * Units of finished goods sold = $25.90 * 460,000 = $11,914,000
w.6: Salespersons commission = Percentage of commission * Sales revenue = 20% * $18,400,000 = $3,680,000
2. Determine the balances in the finished goods and work in process inventories for the iLeather product on December 31, 20Y3.
Balance in finished goods inventories = Unit of ending finished goods * Cost of goods manufactured per unit = 40,000 * $25.90 = $1,036,000
Balance in work in progress inventories = Units of work in progress * (Material cost + Overhead per unit) = 22,000 * (15.4 + $10) = 22,000 * 25.4 = $558,800
Therefore, balance in finished goods inventories is $1,036,000; and balance in work in progress inventories is $558,800.
1. The preparation of the annual income statement for the iLeather product is as follows:
Technology Accessories Inc.
Income Statement for the iLeather Product
For the Year ended December 31, 20Y3
Sales revenue $18,400,000
Cost of goods sold 11,914,000
Gross profit $6,486,000
Expenses:
Marketing and advertising 750,000
Sales promotion 1,400,000
Sales commission 3,680,000
Total expenses $5,830,000
Net operating income $656,000
2. The balances in the finished goods and work in process inventories on December 31, 20Y3 are as follows:
Finished goods inventory = $1,036,000
Work in process inventory = $558,800
Data and Calculations:
Marketing and advertising materials = $750,000
Product promotion costs = $1,400,000
Total direct materials cost per unit = $15.40
Total direct labor cost per unit = $0.50
Production units = 500,000 units
Units sold = 460,000 units
Finished goods inventory = 40,000 units (500,000 - 460,000)
Machine hours used = 4,000 hours (500,000/125)
Factory overhead costs = $5,000,000 ($1,250 x 4,000).
Work in process inventory costs:
Factory overhead costs = $220,000 (22,000/125 x $1,250).
Direct materials = $338,800 ($15.40 x 22,000)
The total work in process inventory costs = $558,800 ($220,000 + $338,800)
Wholesale price per unit = $40
Sales revenue = $18,400,000 ($40 x 460,000)
Sales commission = 20% of wholesale price or $8 per unit ($40 x 20%)
The total sales commission = $3,680,000 ($8 x 460,000).
Production costs:
Direct materials costs = $7,700,000 ($15.40 x 500,000)
Direct labor costs = $250,000 ($0.50 x 500,000)
Factory overhead costs = $5,000,000
Total production costs = $12,950,000
Cost per unit = $25.90 ($12,950,000/500,000)
Finished goods inventory costs = $1,036,000 ($25.90 x 40,000)
Cost of goods sold = $11,914,000 ($25.90 x 460,000)
Learn more about determining the balances in the finished goods and work in process inventories here: https://brainly.com/question/14775648
It is common for supermarkets to carry both generic (store-label) and brand-name (producer-label) varieties of sugar and other products. Many consumers view these products as perfect substitutes, meaning that consumers are always willing to substitute a constant proportion of the store brand for the producer brand. Consider a consumer who is always willing to substitute four pounds of a generic store-brand sugar for two pounds of a brand-name sugar. Do these preferences exhibit a diminishing marginal rate of substitution between store-brand and producer-brand sugar.
Required:
a. Do these preferences exhibit a diminishing marginal rate of substitution? Assume that this consumer has $24 of income to spend on sugar, and the price of store-brand sugar is $1 per pound and the price of producer-brand sugar is $3 per pound.
b. How much of each type of sugar will be purchased?
c. How would your answer change if the price of store-brand sugar was $2 per pound and the price of producer-brand sugar was $3 per pound?
Answer:
a. Do these preferences exhibit a diminishing marginal rate of substitution?
no, because the consumer is actually purchasing a higher amount of goods, the only difference is that they are paying a lower price.Assume that this consumer has $24 of income to spend on sugar, and the price of store-brand sugar is $1 per pound and the price of producer-brand sugar is $3 per pound.
The consumer will purchase 24 pounds of price of store sugar simply because the price is much lower, not because he/she wants to consume less. Actually a lower price might result in an increase of consumption.b. How much of each type of sugar will be purchased?
If the consumer is willing to spend the whole $24 on sugar, he/she will purchase 24 pounds of store brand sugar. The alternative is to buy 8 pounds of producer brand sugar, and that is not a good deal.c. How would your answer change if the price of store-brand sugar was $2 per pound and the price of producer-brand sugar was $3 per pound?
The consumer would purchase 12 pounds of store brand sugar instead of 24, but he/she will still not purchase producer brand sugar since the difference in price is still too high. Remember that consumers view both types of sugar as perfect substitutes, so they will purchase the brand with the lower price.______has an absolute advantage in the production of alfalfa, and_______ has an absolute advantage in the production of barley. Charles's opportunity cost of producing 1 bushel of barley is ________bushels of alfalfa, whereas Dina's opportunity cost of producing 1 bushel of barley is bushels of alfalfa. Because Charles has a opportunity cost of producing barley than Dina, ________has a comparative advantage in the production of barley, and has a comparative advantage in the production of alfalfa
Answer:
The person with Absolute advantage is the one that produces more of a good than the other.
Dina has an absolute advantage in the production of alfalfa, and Charles has an absolute advantage in the production of barley.
The person with Comparative Advantage is the person who produces something at a lower opportunity cost.
Charles Opportunity Costs
Producing Alfalfa gives 12 bushels per acre instead of 6 bushels for Barley.
Producing 1 Alfalfa means 6/12 = 0.5 bushels Barley is given up
Producing 1 bushel of Barley means 12/6 = 2 bushels Alfalfa is given up.
Dina Opportunity Costs
Producing Alfalfa gives 15 bushels per acre instead of 5 bushels for Barley.
Producing 1 Alfalfa means 5/15 = 0.33 bushels of Barley is given up
Producing 1 bushel of Barley means 15/5 = 3 bushels of Alfalfa is given up.
Charles's opportunity cost of producing 1 bushel of barley is 2 bushels of alfalfa, whereas Dina's opportunity cost of producing 1 bushel of barley is 3 bushels of alfalfa. Because Charles has lower a opportunity cost of producing barley than Dina, Charlie has a comparative advantage in the production of barley, and Dina has a comparative advantage in the production of alfalfa.
The person with Absolute advantage is the one that produces more of a good than the other. Dina has an absolute advantage in the production of alfalfa, and Charles has an absolute advantage in the production of barley. The person with Comparative Advantage is the person who produces something at a lower opportunity cost.
7 reasons why marketing must be studied.
hope this help!
Bryant leased equipment that had a retail cash selling price of $690,000 and a useful life of six years with no residual value. The lessor spent $575,000 to manufacture the equipment and used an implicit rate of 8% when calculating annual lease payments of $138,201 beginning January 1, the beginning of the lease. Lease payments will be made January 1 each year of the lease. Incremental costs of consummating the lease transaction incurred by the lessor were $19,500.
Required:
What is the effect of the lease on the lessor's earnings during the first year (ignore taxes)?
Answer:
$139,644
Explanation:
Calculation for the effect of the lease on the lessor's earnings during the first year
Effect on lessor's pretax earnings
Sales revenue 690,000
Less Cost of goods sold(575,000)
Less Selling expense(19,500)
Interest revenue 44,144
Income effect $139,644
Calculation for Interest revenue
Interest revenue=(8%*690,000)-(8%*$138,201)
Interest revenue =55,200-11,056
Interest revenue=44,144
Therefore the effect of the lease on the lessor's earnings during the first year will be $139,644
An Internet company in South Florida is receiving frequent requests from employees who want to telecommute. The company's CTO wants to be flexible and accommodate as many employees as possible. At the same time, the CTO wants to achieve productivity goals and keep to a minimum any legal issues that may arise from this new work alternative. After reading the information presented in this chapter and other sources, answer the following questions and support your answers with references: Provide three guidelines that telecommuters need to follow and why?
Answer with Explanation:
Following are the three guidelines that telecommuters must follow along with its benefits:
Confidentiality must not be breached because the employee is working from home or somewhere he feel comfortable. So the employee must ensure that the he doesn't intentionally and unintentionally breach confidentiality agreement.Ensure Time management which means if they are not giving agreed time to the company affairs then they are not affecting several tasks that will end up in increase in cost and decrease in customer satisfaction.Achieve daily goals because they are accountable for the tasks they are assigned and must remain focused. This will fulfill the purpose of recruiting them which means that the employee is fulfilling his promise of delivering the work agreed. This will help the company gain the benefit for which the company has recruited the employee.ABC systems:_____.
a. highlight the different levels of activities.
b. will limit cost drivers to units of output.
c. will allocate costs based on the overall level of activity.
d. generally will undercost complicated or complex products.
Answer: highlight the different levels of activities.
Explanation:
The activity-based costing (ABC) system is an accounting method that is used by a company to calculate the total cost of activities that'll be utilized when making a product.
In the activity based costing system, costs are being assigned to every that is used during production. Also, the direct cost and the overhead costs are being considered. In ABC system, the different levels of activities are highlighted.
List and describe five potential strategies for conflict resolution in teams. Which methods have been found to be most effective in teams? Which method is likely to be most successful if your manager likes to be involved in every decision?
Explanation:
Some efficient strategies for resolving conflicts in teams can be: assessing the situation, improving communication, providing feedback, redesigning work, collaboration, including employees in the decision.
The most effective methods are usually those that integrate several factors that act directly on the central motivator that is generating the conflicts, so it is necessary to analyze the situation, improve an effective communication about the team's objectives, provide feedback so that team members feel motivated to develop their skills in the best way, redesigning the work so that each employee is exercising the function that best suits their skills and the inclusion of employees in the team's decision-making processes, which creates a sense greater appreciation of work.
In the case of managers who are involved in all decisions, it is more appropriate to use the collaborative method, actively participating in the team's challenges, providing help and assisting subordinates in their demands in favor of the team's success.
Buyers who are aware of Firm’s ___________________ might desire to purchase its products because price no longer remains a limiting factor
1)location
2)prestige
3)competition
whixh one is correct
Answer:
2) prestige.
Explanation:
Buyers who are aware of Firm’s prestige might desire to purchase its products because price no longer remains a limiting factor.
On November 1, 2021, Jamison Inc. adopted a plan to discontinue its barge division, which qualifies as a separate component of the business according to GAAP regarding discontinued operations. The disposal of the division was expected to be concluded by April 30, 2022. On December 31, 2021, the company's year-end, the following information relative to the discontinued division was accumulated:
Operating loss Jan. 1–Dec. 31, 2021 $67 million
Estimated operating losses, Jan. 1 to April 30, 2022 99 million
Excess of fair value, less costs to sell, over book value at Dec. 31, 2021 16 million
In its income statement for the year ended December 31, 2021, Jamison would report a before-tax loss on discontinued operations of:
a. $150 million.
b. $166 million.
c. $51 million.
d. $67 million.
Answer:
d. $67 million.
Explanation:
The asset is not impaired because the fair value is higher than the book value. Therefore, the only operating loss of $67,000,000 can be reported.
Particulars Amount
Operating Loss(Jan 1 to 31 Dec 2021 $67,000,000
Before Tax loss on discontinued operation $67,000,000
Hence, Jamison would report a before-tax loss on discontinued operations of $67,000,000.
Universal Mines Inc. operates three mines in West Virginia. The ore from each mine is separated into two grades before it is shipped. The daily production capacities of the three mines, as well as their daily operating costs, are as follows: c/day Mine High-grade Ore, Low-grade Ore, Operating Cost Tons/day Tons/day in $/day 20,000 22,000 18,000 Mine 11 Mine III Universal has committed itself to deliver 54 tons of high-grade order and 65 tons of low-grade ore by the end of the week. Universal can run its mines seven days a week if required. Determine the number of days each mine should be operated during the upcoming week if Universal Mines is to fulfill its commitment at the minimum total cost. Round the answers to two decimal places.
a. The number of days Mine I should operate = _________days
b. The number of days Mine Il should operate = _________days
c. The number of days Mine III should operate = _________days
d. The total cost of the operation for next week = $ ________
Answer:
this is a cost minimization problem, but it is missing some numbers, so I looked for similar questions (see attached PDF):
minimization equation = 20x₁ + 22x₂ + 18x₃ (costs per ton)
where:
x₁ = mine I
x₂ = mine II
x₃ = mine III
the constraints are:
4x₁ + 6x₂ + x₃ ≥ 54 (high grade ore)
4x₁ + 4x₂ + 6x₃ ≥ 65 (low grade ore)
x₁, x₂, x₃ ≤ 7 (only 7 days per week)
using solver, the optimal solution is
2x₁, 7x₂, and 5x₃
a. The number of days Mine I should operate = 2 days
b. The number of days Mine Il should operate = 7 days
c. The number of days Mine III should operate = 5 days
d. The total cost of the operation for next week = $284,000
The following transactions occurred during the month of August 2019 for the Washington Apple Company:
1 Issued 10,000 shares of stock in exchange for $100,000 in cash.
2 Purchased equipment at a cost of $70,000 and paid cash.
3 Purchased supplies on account for $5000.
4 Made cash sales of $45,000 in the month of August.
5 Paid rent on a warehouse in amount of $7000 for August.
Required: Analyze each transaction and show the effect of each using for increases and for decreases:
Answer:
1. Increase in equity
2. increase in asset
3. increase in liability
4. Increase in revenue
5. Increase in expense
Explanation:
Assets is anything that provides future benefit to a company. Assets are reported in the balance sheet of the company and the company's reliability is measured on the basis of strength of its assets. Liability is the obligation that the company has to pay in future. These asset to liability ratio should be atleast 1 for the organizations.