Answer:
$467,100
Explanation:
The solution of cumulative mark to market is shown below:-
Total cost for 90,000 bushels = Per bushel × Needed bushels
= $5.19 × 90,000
= $467,100
Therefore for calculating the total cost we simply applied the above formula i.e by multiplying the per bushel with the needed bushels so that the total cost for 90,000 bushels could arrive
Precise Machinery is analyzing a proposed project. The company expects to sell 3,500 units, give or take 5 percent. The expected variable cost per unit is $260 and the expected fixed costs are $589,000. Cost estimates are considered accurate within a plus or minus 4 percent range. The depreciation expense is $129,000. The sales price is estimated at $750 per unit, plus or minus 3 percent. What is the sales revenue under the worst case scenario
Answer:
Sales revenue= $2,418,937.5
Explanation:
Giving the following information:
The company expects to sell 3,500 units, give or take 5 percent.
The sales price is estimated at $750 per unit, plus or minus 3 percent.
The sales revenue worst-case scenario is the one with the lowest units sold and the lowest selling price per unit.
Units sold= 3,500*0.95= 3,325
Selling price= 750*0.97= $727.5
Sales revenue= 3,325*727.5= $2,418,937.5
Judith George makes an offer to sell a plot of land using a normal letter and states no authorized means by which the offeree,Helga Holmes must respond if she accepts.If Helga accepts the offer using a normal letter,which of the following is true?
A) The acceptance is effective upon dispatch.
B) The acceptance is effective when it is received.
C) The offer is invalid because it fails to stipulate the means of acceptance.
D) The acceptance would be effective upon dispatch even if the means of acceptance is unreasonable.
Answer:
A) The acceptance is effective upon dispatch
Explanation:
In the given scenario an offer was made by Judith using normal letter, she did not state the authorised means by which the acceptance should be made.
If Helga accepts the offer and chooses and means to convey the acceptance, it will be acceptable as there is no specific way stated by Judith.
So when Helga responds by using a normal letter, the acceptance is effective when she dispatches the letter.
If however Judith stated an authorised means of acceptance, Helga would have to comply to make sure her acceptance is valid
A consumer values a house at $525,000 and a producer values the same house at $485,000. If the transaction is completed at $510,000, what amount of tax will result in unconsummated transaction? a. A tax of $14,000 b. A tax of $15,000 c. A tax of $9,000 d. A tax of $18,000
Answer:
d. A tax of $18,000
Explanation:
If the price is higher than $525,000 which is his reservation price, the buyer will not buy the good
(1+t) > $525,000 / $510,000
1+t > 1.03
t > 0.03
t > 3%
3% of $510,000 = $15,300. So if the tax is greater than $15,300, the buyer will not buy the good . Hence, the answer is option (D) A tax of $18,000 as this tax is higher than $15,300 while other option are less than $15,300
An account becomes uncollectible Group of answer choices when an account receivable is converted into a note receivable when a discount is availed on notes receivable There is no general rule for when an account becomes uncollectible. at the end of the fiscal year
Answer:
There is no general rule for when an account becomes uncollectible.
Explanation:
An account becomes uncollectible when an account receivable is written-off due to different situations, which means that there is no general rule for when an account becomes uncollectible.
For example, an account can become uncollectible if the debtor becomes unsolvent. It can also become uncollectible if the firm is victim of fraud, or if the firm itself decides to write-off the account due to company policy.
Which of the following is a characteristic of both the sales approach for service-type warranties and the expense approach for assurance-type warranties?
a. Estimated liability under warranties
b. Warranty expense
c. Unearned warranty revenue
d. Warranty revenue
Answer: Unearned warranty revenue
Explanation:
Unearned warranty revenue is usually shown as an unearned revenues in the accrued liabilities during the preparation of the balance sheets.
It should be noted that the unearned warranty revenue is a characteristic of both the sales approach for service-type warranties and the expense approach for assurance-type warranties.
In a "perfect world" capital market, how important is a firm's decision to pay dividends versus repurchase shares? Under what conditions would you have a tax preference for share repurchase rather than dividends? Would managers acting in the interests of long-term shareholders be more likely to repurchase shares if they believed the stock to be either undervalued or overvalued?
Answer and Explanation:
A business may use its extra funds to return it to the shareholders, by either paying cash dividends to the company's existing shareholders or by buying back its own shares. Dividends are a profit-share. Dividends are paid out of an enterprise's net profit (PAT).
Now
On the other way, by way of equity buyback plans, a company can use its money to repurchase its assets. A buyback would decrease a company's a number of shares outstanding and significantly increase the long-term earnings per share ( EPS), and cash flow per share.
The decision of a corporation to pay a dividend and repurchase shares is significant as it can use such actions to manage the investors' interests and the corporation's interest.
Although dividend payment provides greater stability for a company's shareholders, the buy back of shares presents a greater level for the company concerned.
Dividends offer the shareholders flexibility by allowing them to make use of the allocated income in whatever way they see fit. Secondly, the dividend benefit for the shareholders is assured.
The buy back of shares from the other hand is also more desirable for taxation purposes. Dividends are taxable although no taxes are required in case of share repurchases till the moment in time when the securities will finally be sold.
Managers serving the interests of shareholders, particularly long-term shareholders, are more likely to purchase shares if they think the shares are undervalued, i.e. trading at a price below its intrinsic value.
It is due to the number of shares outstanding decreases as the securities are bought back and therefore the earnings per share ( EPS) and cash flows per share increase.
These enhancements help push share prices in the second hand market. This implies that the stock price in the secondary market is no longer at a point below its intrinsic value.
This initiative would mean that securities are no longer underpriced in the long term, thereby protecting the interests of long-term investors.
Mango Company applies overhead based on direct labor costs. For the current year, Mango Company estimated total overhead costs to be $500,000, and direct labor costs to be $250,000. Actual overhead costs for the year totaled $520,000, and actual direct labor costs totaled $280,000. At year-end, the balance in the Factory Overhead account is a:
Answer:
Under/over applied overhead= $40,000 overallocated
Explanation:
Giving the following information:
Estimated overhead= $500,000
Estimated direct labor costs= $250,000
Actual overhead costs for the year totaled $520,000, and actual direct labor costs totaled $280,000.
First, we need to calculate the predetermined overhead rate:
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Predetermined manufacturing overhead rate= 500,000/250,000
Predetermined manufacturing overhead rate= $2 per direct labor cost
Now, we can allocate overhead:
Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH= 2*280,000= $560,000
Finally, we can determine the over/under allocation:
Under/over applied overhead= real overhead - allocated overhead
Under/over applied overhead= 520,000 - 560,000= $40,000 overallocated
A copy machine acquired on July 1 with a cost of $1,450 has an estimated useful life of four years. Assuming that it will have a residual value of $250, determine the depreciation for the first year by the double-declining-balance method.
Answer:
Annual depreciation= $300
Explanation:
Giving the following information:
Purchasing price= $1,450
Salvage value= $250
Useful life= 4 years
First, we need to determine the annual depreciation for the whole year using the following formula:
Annual depreciation= 2*[(book value)/estimated life (years)]
Annual depreciation= 2*[(1,450 - 250) / 4]
Annual depreciation= $600
Now, for 6 months:
Annual depreciation= (600/12)*6= $300
The total payroll of trolley company for the month of october was 960000 of which 180000 represented amounts paid to certain employees in excess of 137000 maximum subject ot social security tax $180,000 of federal income taxes and $18,000 of union dues were withheld. The state unemployment tax is 1%, the federal unemployment tax is .8%, and the current F.I.C.A. tax is 7.65% on an employee's wages to $118,500 and 1.45% in excess of $118,500. What amount should Trolley record as payroll tax expense?
Answer:
$68,760
Explanation:
The computation of the payroll expense is shown below:
FICA taxes ($960,000 - $180,000) × (7.65% - 1.45%) $48,360
Medicare ($960,000 × 1.45%) $13,920
State unemployment tax {($960,000 - $600,000) × 1%} $3,600
Federal unemployment tax {($960,000 - $600,000) × 0.80%} $2,880
Total $68,760
Preferred stock is a form of debt financing because the dividend must be paid before dividends can be paid to the equity owners.
Answer:
False
Explanation:
Preference stock is a type of ownership of equity whereas the bond is the form of debt. The preference stock is the stock in which the dividend is fixed and to be paid before paying the common shareholders.
it includes the features like no voting rights, fixed dividend
Therefore the given statement is false
A sudden fall in the market demand in a competitive industry leads to a. A short run market equilibrium price lower than the original equilibrium b. A market equilibrium price higher than the short run price c. Some firms exiting the market d. All of the above
Answer:
The answer is C. Some firms exiting the market
Explanation:
When there is a sudden fall in the market demand in a competitive industry(e.g perfect competition) some firms would making economic losses and it is best if they shut down operation and production. Once these happen, they exit the market.
Option A is incorrect . Same as option B.
Option D is also incorrect
How can you filter the for review tab to see all the transactions quickbooks online thinks it has found a good match for?
Answer:
Click on the Recognized tab
Explanation:
If you want to filter the for review tab to find the good match all you have to do is:
Step 1: Go at "For Review" Tab
Step 2: Above the transactions their will be Recognized Tab. Click on it which would filter all the transactions that provides a good match.
Your grandparents would like to establish a trust fund that will pay you and your heirs $135,000 per year forever with the first payment one year from today. If the trust fund earns an annual return of 2.6 percent, how much must your grandparents deposit today?
Answer:
PV= $5,192,307.70
Explanation:
Giving the following information:
Cash flow= $135,000 per year forever
Interest rate= 2.6% = 0.026 compounded annually
To calculate the present value of the perpetual annuity, we need to use the following formula:
PV= Cf/i
PV= 135,000/0.026
PV= $5,192,307.70
Determine the incremental rate of return (ROR) value of the two alternatives below. Hint: Convert RoR value to a percentage. If the answer is 10%, enter 10. Do not enter 0.01. A B First Cost, $ 135,000 185,000 Operating Cost, $/year 9,000 5,200 Salvage value, $ 9,000 10,000 Life, n [infinity] [infinity]
Answer:m Incremental rate of return (ROR) = 0.076 ≈7.6%
Explanation:
Given that;
A B
First Cost $ 135,000 185,000
Operating Cost $/year 9,000 5,200
Salvage value $ 9,000 10,000
Life, n [infinity ∞] [infinity ∞]
As alternatives have infinite life, salvage value will have no effect on calculations
Therefore;
Incremental initial cost (B-A) = 185000 - 135000 = 50000
Incremental annual cost (B-A) = 5200 - 9000 = -3800 (Annual savings)
Present worth of infinite annuity = A / i
Incremental rate of return ROR = 3800 / 50000 = 0.076 ≈7.6%
The marketing department of a reputable firm wants to improve strategic decision making, track the actions of other players in the market, and provide early warning of opportunities and threats. Which of the following would help the firm achieve its objectives?
A) Data warehousing
B) strategic planning competitive marketing intelligence
D) customer relationship management
E) ethnographic research
Answer:
The answer is C. competitive marketing intelligence
Explanation:
Competitive marketing intelligence may be a powerful research-based method employed by a company to collect, analyze, and use information collected on competitors, economic conditions, customers etc to a achieve business's competitive advantage.
The information-gathering analysis process can help a corporation develop its strategy or identify competitive gaps. It identifies threats and opportunities within the business
Kant Corporation retires its $100,000 face value bonds at 102 on January 1, following the payment of interest. The carrying value of the bonds at the redemption date is $96,250. The entry to record the redemption will include a
Answer:
Refer to the explanation below
Explanation:
Please see the journal entry below;
Dr Bonds payable $100,000
Dr Loss on retirement of bonds
$5,750
( $102,000 + $3,750 - $100,000)
To Cash $102,00( $100,000 × 1.02)
To Discount on bonds payable
$3,750( $100,000 - $96,250)
(Being redemption that is recorded)
Because bonds payable and loss on retirement of bonds decreases the liability and increased the loss, hence were debited. Cash and discount on bonds payable were credited because it decreases the assets and increased liabilities respectively.
UA Hamburger Hamlet (UAHH) places a daily order for its high-volume items (hamburger patties, buns, milk, and so on). UAHH counts its current inventory on hand once per day and phones in its order for delivery 24 hours later. Determine the number of hamburgers UAHH should order for the following conditions:
Average daily demand 600
Standard deviation of demand 100
Desired service probability 99%
Hamburger inventory 800
Answer:
730 items
Explanation:
The objective of the given information is to determine the number of hamburgers UAHH should order for the following conditions:
Average daily demand 600
Standard deviation of demand 100
Desired service probability 99%
Hamburger inventory 800
The formula for a given order quantity in a fixed period of time can be expressed as :
[tex]q = \overline d(L+T)+ z \sigma_{L+T}-I[/tex]
where;
[tex]q[/tex] = order quantity = ???
[tex]\overline d[/tex] = daily demand average = 600
L = lead time in days = 1
T = time taken = 1
z = no of standard deviation = ???
[tex]\sigma_{L+T}[/tex] = standard deviation of usage in lead time and time taken = ???
I = present inventory level = 800
[tex]\sigma_{L+T}[/tex] = [tex]\sqrt 2[/tex] × standard deviation of daily demand
[tex]\sigma_{L+T}[/tex] = [tex]\sqrt{2} *100[/tex]
[tex]\sigma_{L+T}[/tex] = 1.4142 * 100
[tex]\sigma_{L+T}[/tex] = 141.42 items
From the Desired service probability 99% = 0.99; we can deduce the no of standard deviation by using the excel function (=NORMSINV (0.99))
z = 2.33
From [tex]q = \overline d(L+T)+ z \sigma_{L+T}-I[/tex]
[tex]q =600(1+1)+ 2.33*(141.42)-800[/tex]
[tex]q =600(2)+ 2.33*(141.42)-800[/tex]
[tex]q =1200+329.5086-800[/tex]
q = 729.5086 items
q ≅ 730 items
Therefore; the number of hamburgers UAHH should order from the following given conditions = 730 items
A $10,000 loan is being paid off by annual payments of $2,000 plus a smaller final payment. If the effective annual rate of interest is 15%, and the first payment is made one year after the time of the loan, find the amount of interest, $X, contained in the fifth payment.
Answer:
fifth payment $2,000
interests paid $1,125.50, principal paid $874.50
principal's balance $6,628.81
Explanation:
first payment $2,000
interests paid $1,500, principal paid $500
principal's balance $9,500
second payment $2,000
interests paid $1,425, principal paid $575
principal's balance $8,925
third payment $2,000
interests paid $1,338.75, principal paid $661.25
principal's balance $8,263.75
fourth payment $2,000
interests paid $1,239.56, principal paid $760.44
principal's balance $7,503.31
fifth payment $2,000
interests paid $1,125.50, principal paid $874.50
principal's balance $6,628.81
How do businesses and the society benefit from marketing?
Answer:
Marketing stimulates a competitive economy, promotes products and services, and targets consumers who are most likely to become purchasers. Higher sales for a company that employs effective marketing strategies translate into expansion, job creation, higher government tax revenue, and eventually, overall growth.
HAVE A GOOD DAY!
Jacobsen Corporation prepares its financial statements applying U.S. GAAP. During its 2016 fiscal year, the company reported before-tax income of $621,000. This amount does not include the following two items, both of which are considered to be material in amount: Unusual gain $201,000 Loss on discontinued operations (301,000) The company's income tax rate is 30%. In its 2016 income statement, Jacobsen would report income from continuing operations of:
Answer:
Jacobsen Corporation
Income from continuing operations of $621,000 will be reported.
Explanation:
The income from continuing operations is the same thing as the operating income. It is the pre-tax income that is reported on Jacobsen Corporation's income statement for the year ended December 31, 2016. The tax rate of 30% is applied on this figure to obtain the income tax expense for the year. But, for Jacobsen that has other unusual items, these are taken into consideration before the income tax is imputed to obtain the after-tax income.
If a company wants to predict how much money it can make this coming year, it would benefit from developing a: short-term forecast. consolidated income statement. statement of cash flows. master budget.
Answer: short-term forecast
Explanation:
The Short-term in business refers to a period a year or less. A Short-term forecast therefore allows for a business to predict its needs and potential receipts within a period of a year or less. Short-term forecasts would include the expenses, revenues, and hence income that a company believes it will receive in the next year or less. The company can therefore be able to predict how much it will make in the coming year using a Short-term forecast.
Halverstein Company's outstanding stock consists of 7,000 shares of cumulative 5% preferred stock with a $10 par value and 3,000 shares of common stock with a $1 par value. During the first three years of operation, the corporation declared and paid the following total cash dividends. Dividend Declared Year 1 $ 0 Year 2 $ 6,000 Year 3 $ 32,000 The amount of dividends paid to preferred and common shareholders in Year 2 is:
Answer:
In Year 2 Preferred Stockholders were paid $6,000 , whilst Common Stockholders were paid $0.
Explanation:
The Preference Shareholders have preference over the Common Stockholders when it comes to payments of dividends.
Also when the Preference Stocks are cumulative, it means that any dividends in arrears need to be honored before the next dividend distribution.
Preference Stock Dividend is the same per year and is calculated as follows :
Preference Stock Dividend = 7,000 × $10 × 5%
= $3,500
Summary of Dividends Paid are as follows :
Year 1
Preference Stock Dividend Paid = $0
Common Stock Dividend Paid = $0
Preference Stock Dividend in Arrears = $3,500
Year 2
Preference Stock Dividend in Arrears for year 1 paid = $3,500
Preference Stock Dividend Paid for year 2 = $ 2,500
Preference Stock Dividend in Arrears = $1,000
Common Stock Dividend Paid = $0
Conclusion :
In Year 2 Preferred Stockholders were paid $6,000 whilst Common Stockholders were paid nothing.
Assume a competitive firm faces a market price of $60, a cost curve of C = 0.004q^3 + 30q + 1000, and a marginal cost of curve of: MC = 0.009q^2 + 25.
a. The firm's profit maximizing output level (to the nearest tenth) is ___units, and the profit (to the nearest penny) at this output level is $____.
b. This will cause the market supply to (shift right/shift left). This will continue until the price is equal to the minimum average cost of $____.
Answer:
a) q = $62.36
b) As the profit level is NEGATIVE ( π = - 99.21 ), this will cause the market supply to shift left. This will continue until the price is equal to the minimum average cost of $60.
Explanation:
Given that; the market price P = $60
The cost curve is C = 0.004q³ + 30q + 1000
The marginal cost of curve of MC = 0.009q² + 25
We know that the condition for the profit maximizing level of output is MC=P
∴ 0.009q² + 25 = 60
0.009q² = 35
q² = 35 / 0.009
q² = 3888.88888
q = √3888.88888
q = $62.36
Now we calculate profit at the equilibrium output
π = TR -TC
π = ( P × Q ) - TC
we know TC = 0.004q³ + 30q + 1000
now we substitute
so π = ( 60 × 62.36 ) - { 0.004(62.36)³ + 30(62.36) + 1000
= 3741.6 - ( 970.01 + 1870.8 + 1000
= 3741.6 - 3840.81
π = - 99.21
As the profit level is NEGATIVE, the supply curve shifts left
Average cost is the cost per unit of output.
Average Cost = TC / q
Average Cost = (0.004q³ + 30q + 1000) / q
Average Cost = 0.004q² + 30 + 1000/q
Now equate the derivative of AC with zero
i.e ΔAC/Δq = 0
Δ/Δd{ 0.004q² + 30 + 1000/q } = 0
0.008q - 1000/q² = 0
0.008q = 1000/q²
0.008q³ = 1000
q³ = 125000
q = ∛125000
q = 50
Average cost at this point will be
AC = 0.004q² + 30 + 1000/q
= 0.004 (50)² + 30 + 1000/50
= 10 + 30 + 20
= $60
As the profit level is NEGATIVE ( π = - 99.21 ), this will cause the market supply to shift left. This will continue until the price is equal to the minimum average cost of $60.
If Tamarisk, Inc. realizes a loss of $9400 on a cash sale of office equipment having a book value of $93600, the total amount reported in the cash flows from investing activities section of the statement of cash flows is
Answer:
The total amount reported in the cash flows from investing activities section of the statement of cash flows is $84,200.
Explanation:
Cash flow from Investing Activities involve the Purchase and or sale of Capital Investments in the business.
The only cash item from Investing Activity for Tamarisk, Inc in the sale of office equipment is the Proceeds or Selling Price that it received in the sale transaction.
Calculation of the Sale Proceeds :
Hint : Open an Office Equipment Disposal T - Account
Office Equipment Disposal T - Account
Debit :
Book Value $93,600
Totals $93,600
Credit :
Profit and Loss $9,400
Proceeds (Balancing figure) $84,200
Totals $93,600
Conclusion :
The total amount reported in the cash flows from investing activities section of the statement of cash flows is $84,200.
definition of home trade
Answer:
Domestic trade, also known as internal trade or home trade, is the exchange of domestic goods within the boundaries of a country. This may be sub-divided into two categories, wholesale and retail
Bob Katz is purchasing a new Honda Pilot for $34,000. He is financing $30,000 with a six year, 4% loan with annual payments. Construct an amortization schedule, in the 2nd year row, corresponding to his second annual payment, what is the dollar amount of the principal reduction
Answer:
$ 4,704
Explanation:
The starting point would be to ascertain the yearly payment using the excel pmt function as below:
=pmt(rate,nper,-pv,fv)
rate is the interest rate on the loa which is 4%
nper is the number of annual payments i.e 6
pv is the amount of finance granted which is $30000
fv is the balance after payments have been i.e $0
=pmt(4%,6,-30000,0)=$5,722.86
Find attached amortization schedule
you are planning t save for retirement over the next 30 years. To do this, you will invest $850 per month in a stock account and $350 per month in a bond account. The return of the stock account is expected to be 10 percent, and the bond account will pay 6 percent. When you retire, you will combine your money into an account assuming a 25 year withdrawal period? stock account value retirement
Answer:
$13,287.70
Explanation:
The computation of the amount at withdrawal is to be determined by using the excel spreadsheet in which we applied the formulas like future value, PMT
Given that
Time period = 30 years
Withdrawal period = 25 years
Invested amount in stock account = $850
Invested amount in bond account = $350
Return on stock = 10%
Return on bond = 6%
Based on the above information
The withdrawal amount os $13,287.70
Which of the following is one of the three variables proposed by a basic OB model which refers to actions that individuals, groups, and organizations engage in as a result of inputs?
a. Processes
b. Scrutinization
c. Planning
d. Association
e. Evaluation
Answer:
a. Processes
Explanation:
The variable that is being described as part of the basic OB model is known as Processes. Like mentioned, these are actions that individuals, groups, and organizations all engage in as a result of inputs, and that leads to certain outcomes. When dealing at an individual level, these processes include a wide range of actions including emotions, moods, motivation, perception, and decision making.
The following selected amounts are reported on the year-end unadjusted trial balance report for a company that uses the percent of sales method to determine its bad debts expense. Accounts receivable$441,000Debit Allowance for Doubtful Accounts 1,310Debit Net Sales 2,160,000Credit All sales are made on credit. Based on past experience, the company estimates 1.0% of credit sales to be uncollectible. What adjusting entry should the company make at the end of the current year to record its estimated bad debts expense
Answer:
The Adjusting entry at the end of the current year to record its estimated bad debts expense is:
Journal Entry:
Debit Bad Debts Expense $22,910
Credit Allowance for Doubtful Accounts $22,910
To record the bad debts expense and bring the Allowance for Doubtful Accounts to a credit balance of $21,600.
Explanation:
a) Allowance for Doubtful Accounts
Beginning balance $1,310 Dr.
Ending balance 21,600
Uncollectible Expense = $22,900
b) Uncollectible for the period = 1% of $2,160,000 = $21,600
This should be the ending balance of the Allowance for Doubtful Accounts.
c) The above journal entry will ensure that the balance in the Allowance for Doubtful Accounts is now $21,600 credit.
Suppose that you take $50 in currency out of your pocket and deposit it in your checking account. If the required reserve ratio is 8%, what is the largest amount (in dollars) by which the money supply can increase as a result of your action?
Answer:
The largest amount (in dollars) by which the money supply can increase as a result of the action is $625.
Explanation:
This is an example of money multiplier.
Money multiplier refers to the maximum amount of money that commercial bank can create or generate with each dollar of reserves.
Reserves or required reserves refer to the amount of money or portion of deposit that the central bank such as the Federal Reserve requires banks to hold and not lend.
In order to determine the largest amount (in dollars) by which the money supply can increase as a result of $50 deposit, money multiplier is used to multiply the $50 deposit.
The formula for the money multiplier is given as follows:
Money multiplier = 1/r
Where;
r = required reserve ratio = 8%, or 0.08.
Therefore, we have:
Money multiplier = 1 / 0.08 = 12.50
Largest amount of increase = Amount of deposit * Money multiplier = $50 * 12.50 = $625.
Therefore, the largest amount (in dollars) by which the money supply can increase as a result of the action is $625.